As
filed with the Securities and Exchange Commission on November 17, 2023
Registration
Statement No. 333-275350
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
Amendment
No. 1 to
FORM
S-1
REGISTRATION
STATEMENT
UNDER
THE
SECURITIES ACT OF 1933
THARIMMUNE,
INC.
(Exact
name of registrant as specified in its charter)
Delaware |
|
2834 |
|
84-2642541 |
(State
or other jurisdiction of
incorporation
or organization) |
|
(Primary
Standard Industrial
Classification
Code Number) |
|
(I.R.S.
Employer
Identification
Number) |
1200
Route 22 East, Suite 2000
Bridgewater,
NJ 08807
(908)
955-3140
(Address,
including zip code and telephone number, including area code of registrant’s principal executive offices)
Randy
Milby
Chief
Executive Officer
Tharimmune,
Inc.
1200
Route 22 East, Suite 2000
Bridgewater,
NJ 08807
(908)
955-3140
(Name,
address, including zip code, and telephone number, including area code, of agent for service)
Copies
to:
Jeffrey
J. Fessler, Esq.
Emily
Mastoloni, Esq.
Sheppard,
Mullin, Richter & Hampton LLP
30
Rockefeller Plaza
New
York, NY 10112-0015
Tel.:
(212) 653-8700 |
|
Rob
Condon, Esq.
Dentons
US LLP
1221
Avenue of the Americas
New
York, NY 10020-1089
Tel.:
(212) 768-6700 |
Approximate
date of commencement of proposed sale to the public:
As
soon as practicable after the date this registration statement becomes effective.
If
any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933 check the following box: ☒
If
this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the
following box and list the Securities Act registration statement number of the earlier effective registration statement for the same
offering. ☐
If
this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If
this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
Indicate
by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting
company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,”
“smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer ☐ |
Accelerated filer ☐ |
Non-accelerated filer ☒ |
Smaller reporting company ☒ |
|
|
|
Emerging growth company ☒ |
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided to Section 7(a)(2)(B) of the Securities Act. ☐
The
registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the
registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective
in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective
on such date as the Commission, acting pursuant to said Section 8(a), may determine.
The
information contained in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration
statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities
and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.
PRELIMINARY
PROSPECTUS |
|
SUBJECT
TO COMPLETION |
|
DATED
NOVEMBER 17, 2023 |
Up to 2,105,263 Shares of Common
Stock
Up to 2,105,263 Pre-Funded Warrants
to purchase up to 2,105,263 Shares of Common Stock
Tharimmune,
Inc.
We
are offering up to 2,105,263 shares of our common stock at an assumed public offering price of $4.75 per share, the
last reported sale price of our common stock as reported on The Nasdaq Capital Market on November 15, 2023 after giving
effect to the Reverse Split (as defined herein). The actual public offering price per share of common stock will be determined
between us and the underwriters at the time of pricing and may be at a discount to this assumed offering price. Therefore, the
assumed public offering price used throughout this prospectus may not be indicative of the final offering price.
We are also offering up to 2,105,263
pre-funded warrants (each a “Pre-funded Warrant”) to purchase up to 2,105,263 shares of our common stock,
exercisable at an exercise price of $0.001 per share, to those purchasers whose purchase of common stock in this offering would
otherwise result in the purchaser, together with its affiliates and certain related parties, beneficially owning more than 4.99%
(or, at the election of the purchaser, 9.99%) of our outstanding common stock immediately following the consummation of this
offering. The purchase price of each Pre-funded Warrant is equal to the price per share of common stock being sold to the public in
this offering, minus $0.001. The Pre-funded Warrants will be immediately exercisable and may be exercised at any time until all of
the Pre-funded Warrants are exercised in full. For each Pre-Funded Warrant we sell, the number of shares of common stock that we are
offering will be decreased on a one-for-one basis.
Except as otherwise indicated, information in
this prospectus, other than as set forth in our financial statements and the notes thereto which are incorporated by reference, reflects
an assumed one for twenty-five (1-for-25) reverse stock split of our common stock, which we refer to as the “Reverse
Split,” to be effective prior to the effective date of the registration statement of which this prospectus forms a part.
Our
common stock is listed on The Nasdaq Capital Market under the symbol “THAR”. There
is no established trading market for the Pre-funded Warrants and we do not intend to list the Pre-funded Warrants on any securities
exchange or nationally recognized trading system.
We
are an “emerging growth company” as that term is used in the Jumpstart Our Business Startups Act of 2012 and, as such, have
elected to comply with certain reduced public company reporting requirements.
You should read this prospectus, together with
the additional information described under the headings “Where You Can Find More Information” and “Incorporation of
Documents by Reference,” carefully before you invest in any of our securities.
Investing
in our common stock is highly speculative and involves a high degree of risk. See “Risk Factors” beginning on page
10 of this prospectus for a discussion of information that should be considered in connection with an investment in our common stock.
Neither
the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined
if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
| |
Per
Share | | |
Per
Pre-funded Warrant | | |
Total | |
Public offering
price | |
$ | | | |
$ | | | |
$ | | |
Underwriting
discounts and commissions (1) | |
$ | | | |
$ | | | |
$ | | |
Proceeds
to us, before expenses | |
$ | | | |
$ | | | |
$ | | |
(1) |
Underwriting
discounts and commissions do not include a non-accountable expense allowance equal to 1.0% of the public offering price payable to the
underwriters. We refer you to “Underwriting” beginning on page 78 of this prospectus for additional information regarding
underwriting compensation. |
We have granted a 45-day option to the representative
of the underwriters to purchase up to 315,789 additional shares of common stock and/or up to 315,789 Pre-funded
Warrants solely to cover over-allotments, if any.
The
underwriters expect to deliver the securities to purchasers on or about ,
2023.
ThinkEquity
The
date of this prospectus is , 2023
TABLE
OF CONTENTS
ABOUT
THIS PROSPECTUS
We
incorporate by reference important information into this prospectus. You may obtain the information incorporated by reference without
charge by following the instructions under “Where You Can Find More Information.” You should carefully read this prospectus
as well as additional information described under “Incorporation of Documents by Reference,” before deciding to invest in
our securities.
Neither
we nor the underwriters have authorized anyone to provide you with additional information or information different from that contained
or incorporated by reference in this prospectus filed with the Securities and Exchange Commission (the “SEC”). We take no
responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. The underwriters
are offering to sell, and seeking offers to buy, our securities only in jurisdictions where offers and sales are permitted. The information
contained in this prospectus, or any document incorporated by reference in this prospectus, is accurate only as of the date of those
respective documents, regardless of the time of delivery of this prospectus or any sale of our securities. Our business, financial condition,
results of operations and prospects may have changed since that date.
The
information incorporated by reference or provided in this prospectus contains estimates and other statistical data made by independent
parties and by us relating to market size and growth and other data about our industry. We obtained the industry and market data in this
prospectus from our own research as well as from industry and general publications, surveys and studies conducted by third parties. This
data involves a number of assumptions and limitations and contains projections and estimates of the future performance of the industry
in which we operate that are subject to a high degree of uncertainty, including those discussed in “Risk Factors.” We caution
you not to give undue weight to such projections, assumptions, and estimates. Further, industry and general publications, studies and
surveys generally state that they have been obtained from sources believed to be reliable, although they do not guarantee the accuracy
or completeness of such information. While we believe that these publications, studies, and surveys are reliable, we have not independently
verified the data contained in them. In addition, while we believe that the results and estimates from our internal research are reliable,
such results and estimates have not been verified by any independent source.
For
investors outside the United States (“U.S.”): We and the underwriters have not done anything that would permit this offering
or the possession or distribution of this prospectus in any jurisdiction where action for those purposes is required, other than in the
U.S. Persons outside the U.S. who come into possession of this prospectus must inform themselves about, and observe any restrictions
relating to, the offering of the securities and the distribution of this prospectus outside of the U.S.
INFORMATION
REGARDING FORWARD-LOOKING STATEMENTS
This
prospectus contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities
Act”) and Section 21E of the Exchange Act of 1934, as amended (the “Exchange Act”) that involve risks and uncertainties.
You should not place undue reliance on these forward-looking statements. All statements other than statements of historical facts contained
in this prospectus are forward-looking statements. The forward-looking statements in this prospectus are only predictions. We have based
these forward-looking statements largely on our current expectations and projections about future events and financial trends that we
believe may affect our business, financial condition, and results of operations. In some cases, you can identify these forward-looking
statements by terms such as “anticipate,” “believe,” “continue,” “could,” “depends,”
“estimate,” “expects,” “intend,” “may,” “ongoing,” “plan,” “potential,”
“predict,” “project,” “should,” “will,” “would” or the negative of those
terms or other similar expressions, although not all forward-looking statements contain those words. We have based these forward-looking
statements on our current expectations and projections about future events and trends that we believe may affect our financial condition,
results of operations, strategy, short- and long-term business operations and objectives, and financial needs. These forward-looking
statements include, but are not limited to, statements concerning the following:
● |
our
projected financial position and estimated cash burn rate; |
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our
estimates regarding expenses, future revenues and capital requirements; |
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our
ability to continue as a going concern; |
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our
need to raise substantial additional capital to fund our operations; |
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the
success, cost and timing of our clinical trials; |
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our
dependence on third parties in the conduct of our clinical trials; |
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our
ability to obtain the necessary regulatory approvals to market and commercialize our product candidates; |
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the
ultimate impact any health epidemic, on our business, our clinical trials, our research programs, healthcare systems or the global
economy as a whole; |
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the
potential that results of pre-clinical and clinical trials indicate our current product candidates or any future product candidates
we may seek to develop are unsafe or ineffective; |
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the
results of market research conducted by us or others; |
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our
ability to obtain and maintain intellectual property protection for our current and future product candidates; |
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our
ability to protect our intellectual property rights and the potential for us to incur substantial costs from lawsuits to enforce
or protect our intellectual property rights; |
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the
possibility that a third party may claim we or our third-party licensors have infringed, misappropriated or otherwise violated their
intellectual property rights and that we may incur substantial costs and be required to devote substantial time defending against
claims against us; |
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● |
our
reliance on third-party suppliers and manufacturers; |
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the
success of competing therapies and products that are or become available; |
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our
ability to expand our organization to accommodate potential growth and our ability to retain and attract key personnel; |
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the
potential for us to incur substantial costs resulting from product liability lawsuits against us and the potential for these product
liability lawsuits to cause us to limit our commercialization of our product candidates; |
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● |
market
acceptance of our product candidates, the size and growth of the potential markets for our current product candidates and any future
product candidates we may seek to develop, and our ability to serve those markets; |
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● |
the
successful development of our commercialization capabilities, including sales and marketing capabilities; and |
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● |
our ability to successfully complete acquisitions. |
These
forward-looking statements are subject to a number of risks, uncertainties and assumptions, including those described in “Risk
Factors.” Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is
not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which
any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements
we may make. In light of these risks, uncertainties and assumptions, the forward-looking events and circumstances discussed in this prospectus
may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements.
You
should not rely upon forward-looking statements as predictions of future events. Although we believe that the expectations reflected
in the forward-looking statements are reasonable, we cannot guarantee that the future results, levels of activity, performance or events
and circumstances reflected in the forward-looking statements will be achieved or occur. Moreover, except as required by law, neither
we nor any other person assumes responsibility for the accuracy and completeness of the forward-looking statements. We undertake no obligation
to update publicly any forward-looking statements for any reason after the date of this prospectus to conform these statements to actual
results or to changes in our expectations.
You
should read this prospectus and the documents that we reference in this prospectus and have filed with the SEC as exhibits to the registration
statement of which this prospectus is a part with the understanding that our actual future results, levels of activity, performance and
events and circumstances may be materially different from what we expect.
PROSPECTUS
SUMMARY
The following summary highlights selected information
contained elsewhere in this prospectus and is qualified in its entirety by the more detailed information and financial statements included
elsewhere in this prospectus and the information incorporated by reference herein. It does not contain all the information that
may be important to you and your investment decision. You should carefully read this entire prospectus, including the matters set forth
under “Risk Factors,” and our financial statements and related notes included elsewhere in this prospectus and incorporated
by reference herein. In this prospectus, unless context requires otherwise, references to “we,” “us,” “our,”
“Tharimmune,” or “the Company” refer to Tharimmune, Inc., a Delaware corporation, and its subsidiaries, unless
the context otherwise requires.
Overview
Tharimmune is
a clinical-stage biotechnology company developing therapeutic candidates in rare, inflammatory and oncologic conditions with high
unmet need. On November 3, 2023, we entered into a patent license agreement (the “Avior Patent License Agreement”)
with Avior Inc. d/b/a Avior Bio, LLC (“Avior”) pursuant to which we received an exclusive sublicensable right and
license to Licensed Patent Rights (as defined
in the Avior Patent License Agreement) and Licensed Technology (as defined in the Avior Patent License Agreement) to, among
other things, Develop (as defined in the Avior Patent License Agreement), have Developed, make, have made, use, sell, import, export
and commercialize AV104 (to be renamed TH104 and hereinafter referred to as TH104) and AV103 (to be renamed TH103 and hereinafter
referred to as TH103) and to practice the Licensed Technology in connection with the foregoing, throughout the world. See “Recent
Developments” below for additional information. In February 2023, the U.S. Food and Drug Administration (“FDA”)
approved an investigational new drug (“IND”) application for TH104. TH104 has a dual
mechanism of action by affecting multiple receptors, known to suppress chronic, debilitating pruritis or “uncontrollable itching”.
With respect to TH104, we intend to first seek approval for the treatment of moderate to severe chronic pruritis in patients with
primary biliary cholangitis (“PBC”), an orphan rare form of liver disease with no known cure in which more than 70% of patients
suffer from debilitating chronic pruritis, and with respect to TH103, we intend to develop the product candidate and potentially file
an IND.
We
are also developing an early-stage pipeline of novel therapeutic candidates targeting validated high value immuno-oncology (“IO”)
targets including human epidermal growth factor (“EGF”) receptor 2 (“HER2”),
human EGF receptor 3 (“HER3”) and programmed cell death protein 1 (“PD-1”).
We are developing antibodies including bispecific antibodies, antibody drug conjugates (“ADCs”) and small molecular weight
bovine- derived Picobodies™ or antibody “knob” domains which have the potential to target and bind more tightly to
“undruggable” epitopes better than full sized antibodies. We are advancing TH3215, a bispecific against both HER2 and HER3
antibody which targets a novel “bridging epitope” encompassing multiple domains of the HER2 extracellular domain (“ECD”)
as well as ligand-dependent and independent blocking of the ECD of HER3 into IND-enabling studies in 2024. In addition, we anticipate
that TH0059, a HER2/HER3 bispecific ADC (“bsADC”), and TH1940, a PD-1 Picobody, will progress to enter IND-enabling studies
in 2024.
We have deprioritized
our previous preclinical candidate, HSB-1216, due to a strategic reprioritization of our vision to focus on therapeutics in high unmet
need cancers focused on novel epitopes of certain antitumor drug targets.
Our
Portfolio
We currently have two bispecific candidates and
a Picobody candidate in pre-clinical development and we recently entered into the Avior Patent License Agreement with respect to an IND-approved transmucosal film product. The
following table summarizes our development candidate pipeline:
Our
Pipeline Candidates
TH104
TH104
is a product which has been developed by embedding drug onto a proprietary transmucosal buccal film which adheres to the inside of the
mouth. TH104 has key features which we believe make it an ideal product candidate for multiple liver-related and other pruritogenic inflammatory
conditions. The active molecule, nalmefene, has a dual mechanism of action by affecting both the µ-opioid receptor and the kappa
opioid receptor as well as inhibiting IL-17 inflammatory cytokine expression. We intend to launch and complete a phase 1 pharmacokinetic
trial for TH104 in early 2024 as well as a phase 2 proof-of-concept in PBC patients over approximately 12 months after aligning with
FDA on trial design. We believe TH104 may also be used for treating chronic pruritogenic conditions associated with cholestatic liver
disease as well as other liver related and non-liver related diseases including fatty and alcoholic liver, non-alcoholic liver disease
and certain types of hepatitis. Chronic pruritis is significant in liver diseases as well as chronic kidney diseases, hemodialysis and
atopic dermatitis.
TH3215
Our pre-clinical, current lead product candidate,
TH3215, is an anti-HER2/HER3 bispecific antibody candidate. The ErbB or HER family of cell
surface proteins are some of the most well-known and validated oncology drug targets including ErbB2 or HER2 and Erb3 or HER3. Our antibodies
against HER2 and HER3 bind to different domains of the extracellular portion of the proteins or epitopes with trastuzumab primarily binding
the extracellular domain (“ECD”) IV of HER2. HER2 is a validated tumor
antigen for antibody drug conjugates to treat HER2 positive cancers with two approved antibodies, Roche/Genentech’s KADCYLA®
and Daiichi Sankyo/AstraZeneca’s ENHERTU®. Areas of interest for the development of TH3215 are as a treatment
of solid tumors in which HER2 is overexpressed includes breast cancer, colorectal cancer, endometrial cancer and gastroesophageal cancer.
On July 5, 2023 (the “ABSI
Effective Date”), we entered into a Research and Development Collaboration and License Agreement (the “ABSI
Agreement”) with Applied Biomedical Science Institute (“ABSI”) pursuant to which ABSI granted us an exclusive
royalty-bearing, sublicensable license to the ABSI Patents (as defined in the ABSI Agreement) and a non-exclusive, royalty-bearing,
sublicensable license to the ABSI Know-How (as defined in the ABSI Agreement) to Exploit (as defined in the ABSI Agreement) the ABSI
Products (as defined in the ABSI Agreement) for the treatment, diagnosis, prediction, detection or prevention of disease in humans
and animals worldwide (the “Territory”). Pursuant to the ABSI Agreement, the parties shall form a committee to manage
the preclinical, investigational new drug enabling studies and such other activities as shall lead to the initiation of a Phase 1
clinical trial of the ABSI Product. The parties will collaborate on a Target-by-Target basis to identify and evaluate ABSI Products
directed against such Target (as defined below) with a view to identifying or generating suitable Products (as defined in the ABSI
Agreement) for our Company to Exploit. “Target” means ErB2 (Her2) and ErbB3. Upon completion of the Discovery Timeline
(as defined in the ABSI Agreement) for a Target, subject to the terms and conditions of ABSI Agreement, we shall exclusively own any
ABSI Products against such Target. In the event the committee determines that the discovery activities are unsuccessful with respect
to a Target, we may propose an additional target, which, upon approval by ABSI, shall replace a failed Target. The antibodies from
ABSI we are licensing are intended to be developed as unique from the currently approved
anti-HER2 antibodies and may be incorporated into proprietary multi-format biologics (bi- and tri-specific antibodies, ADCs, CAR-T
and CAR-NKs) against drug resistant cancers including HER2-positive metastatic breast cancer, gastric cancer, lung cancer and
ovarian cancer.
TH0059
Our
second product candidate, TH0059, is a bispecific anti-HER2/anti-HER3 monoclonal ADC candidate. Research studies elucidating the
biology of HER3 reveal that triggering of HER3 signaling stimulates tumor progression via augmentation of metastatic potential and induces
treatment failure in human tumors. Mounting evidence supports HER3 as an important target and its activation is considered to be required
to overcome therapeutic resistance, enhance efficacy, and increase patient survival. To date, to our knowledge, is no FDA-approved HER3-targeted
therapy for cancer treatment. Targeting both HER2 and HER3 with a blocking antibody is a strategy we intend to explore as we progress
our pipeline.
TH1940
Our third product
candidate, TH1940, is a proprietary IO biologic, in development targeting PD-1. On November 21, 2022, we entered into a research collaboration
and product license agreement with Minotaur Therapeutics, Inc. (“Minotaur”) and a commercial license agreement with Taurus
Biosciences, LLC (“Taurus”) for use of certain technology, including OmniAb antibodies, to advance Picobodies against novel,
unreachable and undruggable epitopes in high-value validated targets starting with PD-1. The research and collaboration agreement and
product license agreement are for the development of proprietary targeted biologics, including TH 1940, against PD-1. It is anticipated
that we will collaborate with Minotaur under the license from Taurus to discover, develop and advance biotherapeutics against high-value
validated IO targets starting with PD-1. We extended this agreement in July of 2023 with an additional target (HER3) and an oncology
target.
Our Other Product Candidates
We intend to further
develop our pipeline with novel bispecific monoclonal antibodies. These bispecific antibodies are planned to simultaneously bind to two
different antigens or to two different epitopes on the same antigen. Whether two different antigens or two epitopes on the same antigen,
the bispecific antibody could bind its targets either on the same cell (cis) or on to different cells (trans). Our strategy
involves targeting PD-1 combined with a known, validated undisclosed antigen or using HER2 instead of PD-1 while naturally occurring
antibodies typically only target one epitope on one antigen.
Our
Strategy
Our
goal is to become a leading biotechnology company developing novel treatments in rare, inflammatory and oncologic diseases with high
unmet needs. Our business strategy comprises the following components:
|
1. |
Develop TH104
as a transmucosal buccal film product for the treatment of chronic pruritis in PBC and other inflammatory diseases. |
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|
2. |
Continue
to advance TH3215 as an anti-HER2/HER3 BspAb for multiple tumor types including high unmet need cancers. |
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3. |
Effectively
create a strategy to develop TH0059 as a bispecific monoclonal ADC specifically targeted to both HER2 and HER3 receptors in high
unmet need standard-of-care resistant tumors with a high capacity to metastasize. |
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|
4. |
Create
a preclinical and clinical path forward for our third product candidate, TH1940, a unique PD-1 Picobody with unique binding differentiation
compared to full length antibodies for IO vulnerable tumors. |
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|
|
5. |
Hasten
the discovery and development of next generation multi-specific (bi- and tri) antibodies with binding capabilities to novel epitopes
of combinations of HER2, HER3, PD-1, PD-L1, TROP2 and other validated targets with and without toxin delivery capacity to multiple
high unmet need rare cancers. |
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|
|
|
6. |
Pursue
strategic collaboration opportunities to maximize the value of our pipeline to bring novel therapies to patients suffering from high
unmet need conditions. |
Recent Developments
On November 3, 2023 (“Avior
Effective Date”), we entered into the Avior Patent License Agreement with Avior pursuant to which we received an exclusive
sublicensable right and license to Licensed Patent Rights
and Licensed Technology to, among other things, Develop, have Developed, make, have made, use, sell, import, export and
commercialize TH104 and TH103 and to practice the Licensed Technology in connection with the foregoing, throughout the world.
Pursuant to the Avior Patent License Agreement, we shall pay Avior a mid six digit up front license fee within ten days of the Avior
Effective Date and an additional mid six digit license fee which shall be paid in four equal installments within ten days of the end
of each fiscal quarter following the Avior Effective Date. In addition, we shall pay Avior a high single digit percentage of any
upfront payments received by us as a result of the grant of any sublicenses with respect to AV104. We shall also pay Avior milestone
payments in the aggregate amount of $24,250,000 upon the occurrence of various development milestones (the “Development
Milestone Payments”). Furthermore, we shall pay Avior certain fees based upon sales milestones. The payments for such sales
milestones range from the low seven digits to the low eight digits with higher sales being subject to higher fees. Finally, we shall
pay Avior royalties based on net sales. Such royalties range from low single digit percentages to mid single digit
percentages with higher sales being subject to lower percentages. The Avior Patent License Agreement shall expire upon the
expiration of the final payment obligation due to Avior as set forth in such agreement. Upon the expiration of the Avior Patent
License Agreement, we shall have a fully paid, irrevocable, freely transferable and sublicensable worldwide license to the
Licensed Patent Rights and Licensed Technology to Develop, have Developed, make, have made, use, have used sell, offer for sale,
have sold, import, have imported, export, have exported, commercialize or have commercialized any and all Licensed Products and to
practice the Licensed Technology worldwide. Pursuant to the Avior Patent License Agreement, we may terminate the agreement at any
time without cause, upon 30 days’ prior written notice to Avior along with payment of the next unpaid Development Milestone
Payment, if any. Furthermore, either we or Avior may terminate the Avior Patent License Agreement (i) on written notice to the other
party if the other party materially breaches any provision of the Avior Patent License Agreement and fails to cure such breach
within 30 days after the breaching party receives written notice thereof or (ii) on written notice in the event that either party
(A) becomes insolvent or admits its inability to pay its debts generally as they become due; (B) becomes subject, voluntarily or
involuntarily, to any proceeding under any domestic or foreign bankruptcy or insolvency law, which is not fully dismissed or vacated
within 60 days; (C) is dissolved or liquidated or takes any corporate action for such purpose; (D) makes a general assignment for
the benefit of creditors; or (E) has a receiver, trustee, custodian or similar agent appointed by order of any court of competent
jurisdiction to take charge of or sell any material portion of its property or business. Upon termination of the Avior Patent
License Agreement, the license granted pursuant to such agreement shall terminate and all rights in the Licensed Patent Rights and
Licensed Products shall revert back Avior.
As of October 31, 2023, our cash balance was
approximately $2.2 million.
Risk
Factor Summary
Our
business is subject to significant risks and uncertainties that make an investment in us speculative and risky. Below we summarize what
we believe are the principal risk factors but these risks are not the only ones we face, and you should carefully review and consider
the full discussion of our risk factors in the section titled “Risk Factors,” together with the other information included
in and incorporated by reference into this prospectus. If any of the following risks actually occurs (or if any of those listed elsewhere
in this prospectus or incorporated by reference here in occur), our business, reputation, financial condition, results of operations,
revenue, and future prospects could be seriously harmed. Additional risks and uncertainties that we are unaware of, or that we currently
believe are not material, may also become important factors that adversely affect our business.
Risks
Related to Our Financial Position and Need for Additional Capital
● |
We
have a limited operating history, and we have no products approved for commercial sale, which may make it difficult for you to evaluate
our current business and likelihood of success and viability. |
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● |
We have incurred significant
losses since inception, we expect to incur losses in the future and we may not be able to generate sufficient revenue to achieve
and maintain profitability. |
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● |
We
will require substantial additional capital to finance our operations in the future. If we are unable to raise such capital when
needed, or on acceptable terms, we may be forced to curtail, delay or discontinue one or more of development programs or future commercialization
efforts. |
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|
● |
Management has performed
an analysis and concluded that there is a substantial doubt about our ability to continue as a going concern. Separately, our independent
registered public accounting firm has also concluded there exists a substantial doubt about our ability to continue as a going concern,
which may hinder our ability to obtain future financing. |
Risks
Related to the Discovery and Development of Our Product Candidates
● |
We are substantially
dependent on the success of our product candidates. If we are unable to complete development of, obtain approval for and commercialize
our product candidates in a timely manner, our business may be harmed. |
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● |
Any delays in the commencement
or completion, or termination or suspension, of our ongoing, planned or future clinical trials could result in increased costs to
us, delay or limit our ability to generate revenue and adversely affect our commercial prospects. |
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● |
The outcome of pre-clinical
testing and early clinical trials may not be predictive of the success of later clinical trials, and the results of our clinical
trials may not satisfy the requirements of the FDA or other comparable foreign regulatory authorities. |
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● |
If we experience delays
or difficulties in enrolling patients in our ongoing or planned clinical trials, our receipt of necessary regulatory approval could
be delayed or prevented. |
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● |
We may be required to perform
additional or unanticipated clinical trials to obtain approval or be subject to post-marketing testing requirements to maintain regulatory
approval. If our candidates prove to be ineffective, unsafe or commercially unviable, our entire pipeline
would have little, if any, value, which would have a material and adverse effect on our business, financial condition, results of
operations and prospects. |
|
|
● |
Adverse side effects or
other safety risks associated with our drug candidates could delay or preclude approval, cause us to suspend or discontinue clinical
trials or abandon further development, limit the commercial profile of an approved label, or result in significant negative consequences
following marketing approval, if any. |
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● |
Our products may never
achieve market acceptance. |
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● |
We face significant
competition, and if our competitors develop and market technologies or products more rapidly than we do or that are more effective,
safer or less expensive than the products we develop, our commercial opportunities will be negatively impacted. |
Risks
Related to Our Reliance on Third Parties
● |
We rely on
third parties to manufacture our product candidates and conduct our pre-clinical studies and clinical trials. If these third parties
do not successfully perform their contractual and regulatory duties or meet expected deadlines, we may not be able to obtain regulatory
approval for or commercialize our drug candidates and our business could be substantially harmed. |
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|
● |
We currently depend on
sole source suppliers and manufacturers for certain ingredients, and the inability to obtain such ingredients as required could harm
our business. |
Risks
Related to Commercialization of Our Drug Candidates
● |
Even if we
are successful in completing all pre-clinical studies and clinical trials, we may not be successful in commercializing one or more
of our drug candidates. |
|
|
● |
The development and commercialization
of pharmaceutical products are subject to extensive regulation, and we may not obtain regulatory approvals for our drug candidates
on a timely basis, or at all. |
Risks
Related to Our Intellectual Property
● |
Our inability
to protect our intellectual property and proprietary rights may have a material adverse effect on our business. |
Risks
Related to Managing Our Business and Operations
● |
We may encounter
difficulties in managing our growth, which could adversely affect our operations. |
● |
Our employees,
independent contractors, consultants, commercial partners, collaborators and vendors may engage in misconduct or other improper activities,
including noncompliance with regulatory standards and requirements. |
Risks
Related to this Offering and our Common Stock
● |
We are currently
listed on The Nasdaq Capital Market. However, if we fail to comply with the continued listing
requirements of The Nasdaq Capital Market, our common stock may be delisted and the price of our common stock and our ability to
access the capital markets could be negatively impacted. |
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|
● |
Our principal stockholders
and management own a significant percentage of our stock and will be able to exert significant control over matters subject to stockholder
approval. |
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● |
We do not intend to pay
dividends on our common stock so any returns will be limited to the value of our stock. |
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|
● |
Our
management will have broad discretion over the use of the net proceeds from this offering, you may not agree with how we use the
proceeds, and the proceeds may not be invested successfully.
|
|
|
● |
You
may experience immediate and substantial dilution in the net tangible book value per share of the common stock you purchase in the
offering.
|
Corporate
Information
Our
principal executive offices are located at 1200 Route 22 East, Suite 2000, Bridgewater, NJ 08807 and our telephone number is (908) 955-3140.
Our website address is www.tharimmune.com. The information contained on our website is not incorporated by reference into
this prospectus, and you should not consider any information contained on, or that can be accessed through, our website as part of this
prospectus or in deciding whether to purchase our securities.
Implications
of Being an Emerging Growth Company
As
a company with less than $1.235 billion in revenues during our last fiscal year, we qualify as an emerging growth company as defined
in the Jumpstart Our Business Startups Act (“JOBS Act”) enacted in 2012. As an emerging growth company, we expect to take
advantage of reduced reporting requirements that are otherwise applicable to public companies. These provisions include, but are not
limited to:
● |
being
permitted to present only two years of audited financial statements, in addition to any required unaudited interim financial statements,
with correspondingly reduced “Management’s Discussion and Analysis of Financial Condition and Results of Operations”
disclosure in this prospectus; |
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● |
not
being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, as amended (“Sarbanes-Oxley
Act”); |
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● |
reduced
disclosure obligations regarding executive compensation in our periodic reports, proxy statements and registration statements; and |
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● |
exemptions
from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute
payments not previously approved. |
We
may use these provisions until the last day of our fiscal year following the fifth anniversary of the completion of our initial public
offering. However, if certain events occur prior to the end of such five-year period, including if we become a “large accelerated
filer,” our annual gross revenues exceed $1.235 billion or we issue more than $1.0 billion of non-convertible debt in any three-year
period, we will cease to be an emerging growth company prior to the end of such five-year period.
The
JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised
accounting standards. As an emerging growth company, we intend to take advantage of an extended transition period for complying with
new or revised accounting standards as permitted by The JOBS Act.
To
the extent that we continue to qualify as a “smaller reporting company,” as such term is defined in Rule 12b-2 under the Exchange Act after we cease to qualify as an emerging growth company, certain of the exemptions available
to us as an emerging growth company may continue to be available to us as a smaller reporting company, including: (i) not being required
to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes Oxley Act; (ii) scaled executive compensation disclosures;
and (iii) the requirement to provide only two years of audited financial statements, instead of three years.
THE
OFFERING
Shares of common stock being offered |
|
Up to 2,105,263
shares of common stock at an assumed public offering price of $4.75 per share, the last reported sale price of our common
stock as reported on The Nasdaq Capital Market on November 15, 2023, after giving effect to the proposed Reverse Split. |
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|
|
Pre-funded Warrants being offered |
|
We are also offering up
to 2,105,263 Pre-funded Warrants to purchase up to 2,105,263 shares of our common stock, exercisable at an exercise price
of $0.001 per share, to those purchasers whose purchase of common stock in this offering would otherwise result in the purchaser,
together with its affiliates and certain related parties, beneficially owning more than 4.99% (or, at the election of the purchaser,
9.99%) of our outstanding common stock immediately following the consummation of this offering. The purchase price of each Pre-funded
Warrant is equal to the price per share of common stock being sold to the public in this offering minus $0.001. The Pre-funded
Warrants will be immediately exercisable and may be exercised at any time until exercised in full.
This prospectus also relates to the offering
of common stock issuable upon exercise of the Pre-funded Warrants.
For each Pre-funded Warrant we sell, the
number of shares of common stock that we are offering will be decreased on a one-for-one basis.
For additional information regarding the terms
of the Pre-funded Warrants, see “Description of Securities We Are Offering.” |
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|
|
Underwriters’ over-allotment option |
|
We have granted the underwriters a 45 day option from the date of this
prospectus, exercisable one or more times in whole or in part, to purchase up to an additional 315,789 shares of common stock
and/or up to an additional 315,789 Pre-funded Warrants (15% of the total number of shares of common stock and/or Pre-funded
Warrants to be offered by us in the offering), solely to cover over-allotments, if any. |
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|
|
Number of shares of common stock to be outstanding after this offering (1) |
|
2,805,737 shares, (or 3,121,526 shares if the underwriters exercise the option to purchase
additional shares in full, assuming no sale of the Pre-funded Warrants). |
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|
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Use of proceeds |
|
We expect to receive net proceeds, after deducting underwriting discounts
and estimated expenses payable by us, of approximately $8.8 million (or approximately $10.2 million if
the underwriters exercise their option to purchase additional shares and/or Pre-Funded Warrants in full), assuming a public offering
price of $4.75 per share, the last reported sale price of our common stock on The Nasdaq Capital Market on November 15,
2023 after giving effect to the proposed Reverse Split, and after deducting commissions and estimated offering expenses payable
by us, and assuming no sale of any Pre-funded Warrants. We intend to use the net proceeds from this offering for the advancement
of TH104’s phase 2 trial expected in 2024, as well as for working capital and other general corporate purposes. We
may also use a portion of the net proceeds to in-license, acquire or invest in complementary businesses, technologies or products,
however, we have no current commitments or obligations to do so. See “Use of Proceeds” for a more complete description
of the intended use of proceeds from this offering. |
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|
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Risk factors |
|
Investing in our common stock involves a high degree of risk. See “Risk
Factors” beginning on page 10 of this prospectus, and the other information included in this prospectus for a discussion
of factors you should consider carefully before deciding to invest in our common stock. |
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Nasdaq Capital Market Symbol |
|
“THAR”.
There is no established trading market for the
Pre-funded Warrants, and we do not expect a trading market to develop. We do not intend to list the Pre-funded Warrants
on any securities exchange or nationally recognized trading system. |
(1)
The number of shares of our common stock to be outstanding after this offering is based on 700,474 shares of our common stock
outstanding as of October 31, 2023, and excludes:
● |
85,758
shares of common stock issuable upon exercise
of outstanding options with a weighted average exercise price of $84.75; |
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|
● |
13,860
shares of common stock issuable upon exercise
of outstanding warrants with a weighted average exercise price of $74.75; |
|
|
● |
63,158 shares
of common stock (or 72,632 shares if the representative exercises its over-allotment option in full) issuable upon exercise
of warrants to be issued to the representative of the underwriters as part of this offering at an exercise price of $5.94
(assuming a public offering price of $4.75 per share, the last reported sale price of our common stock as reported on The
Nasdaq Capital Market on November 15, 2023 after giving effect to the proposed Reverse Split). |
Unless
otherwise indicated, all information in this prospectus assumes:
● |
no
exercise of the warrants or options described above; and |
|
|
● |
no
exercise by the underwriters of their option to purchase an additional 315,789 shares of common stock to cover over-allotments,
if any. |
RISK
FACTORS
An
investment in our securities involves a high degree of risk. Prior to making a decision about investing in our securities, you should
carefully consider the risk factors described below and the risk factors discussed in the sections entitled “Risk Factors”
contained in our most recent Annual Report on Form 10-K, as amended, and Quarterly Report on Form 10-Q, as may be amended, supplemented
or superseded from time to time by other reports we file with the SEC and incorporated by reference in this prospectus, together with
all of the other information contained in this prospectus. Additional risks and uncertainties not presently known to us, or that we currently
view as immaterial, may also impair our business. If any of the risks or uncertainties described in our SEC filings or this prospectus
or any additional risks and uncertainties actually occur, our business, financial condition and results of operations could be materially
and adversely affected. In that case, the trading price of our common stock could decline and you might lose all or part of your investment.
Risks
Related to Our Financial Position and Need for Additional Capital
We
have a limited operating history, which may make it difficult to evaluate our current business and predict our future performance.
We
are a clinical-stage biopharmaceutical company with a limited operating history upon which you can evaluate our business and prospects.
We commenced operations in 2017, have no products approved for commercial sale and have not generated any revenue. Drug development is
a highly uncertain undertaking and involves a substantial degree of risk. Since our inception, we have spent the first three years developing
and refining our technology, and since 2019, we have focused our efforts on advancing the development of our product candidate, HSB-1216,
which we recently deprioritized, as well as TH3215, TH0059 and TH1940 (formerly known as HSB-3215, HSB-0059 and HSB-1940, respectively).
In November 2023, we entered into the Avior Patent License Agreement for a clinical-stage asset, TH104, and TH103, a compound which we intend to potentially
file an IND for.
We
have not yet commenced human clinical trials for any of our product candidates, nor have we demonstrated an ability to initiate or successfully
complete any large-scale or pivotal clinical trials, obtain marketing approvals, manufacture a commercial-scale product or arrange for
a third party to do so on our behalf, or conduct sales and marketing activities necessary for successful product commercialization. As
a result, it may be more difficult for you to accurately predict our likelihood of success and viability than it could be if we had a
longer operating history.
We
intend to commence Phase 1 clinical studies for
TH104 in 2023 and Phase 2 clinical studies in 2024. In addition, we intend to submit INDs to the FDA for our early-stage pre-clinical
programs to gain approval to initiate clinical studies in 2025 for both TH3215 and TH1940; however, no assurance can be provided that
our clinical Phase 1 or Phase 2 studies will be completed or that our INDs will be accepted by the FDA based on our anticipated timeline,
if at all. Our early-stage programs are in pre-clinical discovery and research stages. As a result, we expect that it will take several
years, if ever, before we have a commercialized product and generate revenue from product sales. Even if we succeed in receiving marketing
approval for and commercializing one or more of our product candidates, we expect that we will continue to incur substantial research
and development and other expenses in order to discover, develop and market additional potential products.
Finding
appropriate biomarkers for our potential drug candidates could limit our commercialization prospects and cause our losses to continue.
Any
biomarker discovery or drug development that we are conducting may not be successful in identifying biomarkers that have commercial value
for our products or therapeutic utility. Platforms may initially show promise in identifying potential biomarkers for our drug candidates,
yet fail to stratify patients for clinical development or commercialization for a number of reasons, including, but not limited to:
● |
research programs
to identify new biomarkers will require substantial technical, financial and human resources, and we may be unsuccessful in our efforts
to identify biomarkers. If we are unable to identify suitable biomarkers for pre-clinical and clinical development, our ability to
stratify patients could be compromised, which could result in significant harm to our financial position and adversely impact our
stock price; |
● |
identified
biomarkers may not demonstrate correlation to efficacy, safety or tolerability; |
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● |
available data that seeks
to correlate genomic or biomarker signatures with certain diseases may be influenced by the race of the patient which may limit the
efficacy of our drug candidates; |
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● |
the regulatory pathway
for the biomarkers may be too complex, expensive or otherwise difficult to navigate successfully; and |
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● |
competitors may develop
alternative approaches that render our potential biomarkers non-competitive or less attractive. |
We
expect to continue to incur losses for the foreseeable future, and we expect these losses to increase as we continue our development
of, and seek regulatory approvals for, our product candidates, and begin to commercialize approved drugs, if any. Typically, it takes
many years to develop a new drug from the time it is discovered to when it is available for treating patients. We may encounter unforeseen
expenses, difficulties, complications, delays and other unknown factors that may increase our expenses and adversely affect our ability
to generate revenue. The size of our future net losses will depend, in part, on our ability to manage these aspects of our business.
We
have incurred significant losses since inception, we expect to incur losses in the future and we may not be able to generate sufficient
revenue to achieve and maintain profitability.
We
have never been profitable and have incurred significant losses in each year since inception. For the six months ended June 30, 2023
and the years ended December 31, 2022 and 2021 we reported a net loss of $5.0 million, $8.5 million and $2.2 million, respectively.
As of June 30, 2023 and December 31, 2022, we had an accumulated deficit of $20.4 and $15.4 million, respectively. We have funded our
operations primarily with proceeds from the sale of our equity and debt securities.
We
expect to continue to incur significant expenses and increasing operating losses for the foreseeable future. The net losses we incur
may fluctuate significantly from quarter to quarter such that a period-to-period comparison of our results of operations may not be a
good indication of our future performance. The size of our future net losses will depend, in part, on the rate of future growth of our
expenses and our ability to generate revenue. Our prior losses and expected future losses have had and will continue to have an adverse
effect on our working capital, our ability to achieve and maintain profitability and the performance of our stock.
Our
ability to generate revenue and achieve profitability depends significantly on our ability to achieve several milestones relating to
the discovery, development and commercialization of our product candidates.
Our
financial condition and operating results have varied significantly in the past and are expected to continue to fluctuate significantly
due to a variety of factors, many of which are beyond our control. Factors relating to our business that may contribute to these fluctuations
include:
● |
our ability
to continue our current research and development programs, including conducting laboratory, pre-clinical studies for product candidates; |
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our ability to initiate
clinical trials for product candidates; |
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the success of our clinical
trials through all phases of clinical development; |
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● |
delays in the commencement,
enrollment and timing of clinical trials; |
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● |
our ability to secure and
maintain collaborations, licensing or other arrangements for the future development and/or commercialization of our product candidates,
as well as the terms of those arrangements; |
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● |
our ability to obtain,
as well as the timeliness of obtaining, additional funding to develop our product candidates; |
● |
the
results of clinical trials or marketing applications for product candidates that may compete with our product candidates; |
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competition
from existing products or new products that may receive marketing approval; |
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● |
potential
side effects of our product candidates that could delay or prevent approval or cause an approved drug to be taken off the market; |
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any
delays in regulatory review and approval of our product candidates; |
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● |
our
ability to identify and develop additional product candidates; |
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● |
the
ability of patients or healthcare providers to obtain coverage or sufficient reimbursement for our products; |
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● |
our
ability, and the ability of third parties such as Clinical Research Organizations (“CROs”) to adhere to clinical study
and other regulatory requirements; |
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● |
the
ability of third-party manufacturers to manufacture our product candidates and key ingredients needed to conduct clinical trials
and, if approved, successfully commercialize our products; |
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● |
the
costs to us, and our ability as well as the ability of any third-party collaborators, to obtain, maintain and protect our intellectual
property rights; |
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● |
costs
related to and outcomes of potential intellectual property litigation; |
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● |
our
ability to adequately support future growth; |
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our
ability to attract and retain key personnel to manage our business effectively; and |
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● |
our
ability to build our finance infrastructure and, to the extent required, improve our accounting systems and controls. |
Developing
new products and services is a speculative and risky endeavor. Products or services that initially show promise may fail to achieve the
desired results or may not achieve acceptable levels of analytical accuracy or clinical utility. We may need to alter our products in
development and repeat clinical studies before we identify a potentially successful product or service. Product development is expensive,
may take years to complete and can have uncertain outcomes. Failure can occur at any stage of the development. If, after development,
a product or service appears successful, we may, depending on the nature of the product or service, still need to obtain FDA and other
regulatory clearances, authorizations or approvals before we can market it. The FDA’s clearance, authorization or approval pathways
are likely to involve significant time, as well as additional research, development and clinical study expenditures. The FDA may not
clear, authorize or approve any future product or service we develop. Even if we develop a product or service that receives regulatory
clearance, authorization or approval, we would need to commit substantial resources to commercialize, sell and market it before it could
be profitable, and the product or service may never be commercially successful. Additionally, development of any product or service may
be disrupted or made less viable by the development of competing products or services.
New
potential products and services may fail any stage of development or commercialization and if we determine that any of our current or
future products or services are unlikely to succeed, we may abandon them without any return on our investment. If we are unsuccessful
in developing additional products or services, our potential for growth may be impaired.
In
cases where we are successful in obtaining regulatory approval to market one or more of our drug candidates, our revenue will be dependent,
in part, upon the size of the markets in the territories for which we gain regulatory approval, the accepted price for the product, the
ability to obtain coverage and reimbursement, and whether we own the commercial rights for that territory. If the number of our addressable
patients is not as significant as we estimate, the indication approved by regulatory authorities is narrower than we expect, or the treatment
population is narrowed by competition, physician choice or treatment guidelines, we may not generate significant revenue from sales of
such products, even if approved.
We
expect our research and development expenses to continue to be significant in connection with our continued investment in our ongoing
and planned clinical trials for our current product candidates and any future product candidates we may develop. Furthermore, if we obtain
regulatory approval for our product candidates, we expect to incur increased sales and marketing expenses. As a result, we expect to
continue to incur significant and increasing operating losses and negative cash flows for the foreseeable future. These losses have had
and will continue to have a material adverse effect on our stockholders’ equity, financial position, cash flows and working capital.
We
will require substantial additional funding. If we are unable to raise capital on favorable terms when needed, we could be forced to
curtail, delay or discontinue our research or drug development programs or any future commercialization efforts.
We intend to advance TH104,
a clinical stage asset, as well as our early-stage candidates, TH3215, TH0059 and TH1940, through development. Developing drugs is expensive
and we expect our research and development expenses to increase substantially in connection with our ongoing activities, particularly
as we advance our product candidates through clinical studies.
As
of June 30, 2023 and December 31, 2022, we had cash of $3.9 million and $6.5 million, respectively; however, we will require additional
capital to obtain regulatory approval for, and to commercialize, our product candidates. Raising funds may present challenges. Even if
we believe we have sufficient funds for our current or future operating plans, we may seek additional capital if market conditions are
favorable or if we have specific strategic considerations.
Any
additional fundraising efforts may divert our management from their day-to-day activities, which may adversely affect our ability to
develop and commercialize our product candidates. In addition, we cannot guarantee that future financing will be available in sufficient
amounts or on terms acceptable to us, if at all. Moreover, the terms of any financing may adversely affect the holdings or the rights
of our stockholders and the issuance of additional securities, whether equity or debt, by us, or the possibility of such issuance, may
cause the market price of our shares to decline. The sale of additional equity or convertible securities may dilute our stockholders.
The incurrence of indebtedness would result in increased fixed payment obligations, and we may be required to agree to certain restrictive
covenants, such as limitations on our ability to make certain dividends, incur additional debt, limitations on our ability to acquire,
sell or license intellectual property rights and other operating restrictions that could adversely impact our ability to conduct our
business. We could also be required to seek funds through arrangements with collaborative partners or otherwise at an earlier stage than
otherwise would be desirable, and we may be required to relinquish rights to some of our technologies or product candidates or otherwise
agree to terms unfavorable to us, any of which may have a material adverse effect on our business, operating results and prospects.
If
we are unable to obtain funding on a timely basis, we may be required to significantly curtail, delay or discontinue one or more of our
research or development programs or the commercialization of any product candidates or be unable to expand our operations or otherwise
capitalize on our business opportunities, as desired, which could materially affect our business, financial condition and results of
operations.
Management
has performed an analysis and concluded that there exists a substantial doubt about our ability to continue as a going concern. Separately,
our independent registered public accounting firm has also concluded there exists a substantial doubt about our ability to continue as
a going concern, which may hinder our ability to obtain future financing.
Our
financial statements as of December 31, 2022 have been prepared under the assumption that we will continue as a going concern for the
next twelve months. Management has performed an analysis and concluded that there exists a substantial doubt about our ability to continue
as a going concern. Separately, our independent registered public accounting firm included in its opinion for the year ended December
31, 2022 an explanatory paragraph referring to our recurring losses from operations and expressing substantial doubt in our ability to
continue as a going concern without additional capital becoming available. Our ability to continue as a going concern is dependent upon
our ability to obtain additional equity or debt financing, obtain government grants, reduce expenditures and generate significant revenue.
Our financial statements as of December 31, 2022 did not include any adjustments that might result from the outcome of this uncertainty.
The reaction of investors to the inclusion of a going concern statement by management and our auditors, and our potential inability to
continue as a going concern, in future years could materially adversely affect our share price and our ability to raise new capital or
enter into strategic alliances.
Risks
Related to the Discovery and Development of Our Product Candidates
We
are substantially dependent on the success of our product candidates. If we are unable to complete development of, obtain approval for
and commercialize our product candidates for one or more indications in a timely manner, our business may be harmed.
Our
future success is dependent on our ability to timely and successfully complete clinical trials, obtain marketing approval for and successfully
commercialize our product candidates. We currently have no products approved for sale. The success of our business, including our ability
to finance our Company and generate any revenue in the future, will primarily depend on the successful development, regulatory approval
and commercialization of our product candidates, which may never occur.
In
the future, we may also become dependent on other product candidates that we may develop or acquire; however, no product candidates based
on our technology have been tested in humans and given our early stage of development, it may be many years, if at all, before we may
be able to demonstrate the safety and efficacy of our product candidates to warrant approval for commercialization.
The
clinical and commercial success of our current and any future product candidates will depend on a number of factors, including the following:
● |
our
ability to raise any additional required capital on acceptable terms, or at all; |
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● |
our
ability to complete IND-enabling studies and successfully submit an IND to the FDA; |
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timely
completion of our pre-clinical studies and clinical trials, which may be slower or cost more than we currently anticipate and will
depend substantially upon the performance of third-party contractors; |
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● |
requirements
by the FDA or similar foreign regulatory agencies to conduct additional clinical trials or other studies beyond those planned to
support approval of our product candidates; |
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● |
acceptance
of our proposed indications and primary endpoint assessments relating to the proposed indications of our product candidates by the
FDA and similar foreign regulatory authorities; |
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● |
our
ability to consistently manufacture our product candidates on a timely basis; |
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● |
our
ability, and the ability of any third parties with whom we contract, to remain in good standing with regulatory agencies and develop,
validate and maintain commercially viable manufacturing processes that are compliant with current
good manufacturing practice (“cGMP”); |
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● |
our
ability to demonstrate to the satisfaction of the FDA and similar foreign regulatory authorities the safety, efficacy and acceptable
risk-benefit profile of our product candidates; |
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● |
the
prevalence, duration and severity of potential side effects or other safety issues experienced with our product candidates or future
approved products, if any; |
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● |
the
timely receipt of necessary marketing approvals from the FDA and similar foreign regulatory authorities; |
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achieving
and maintaining, and, where applicable, ensuring that our third-party contractors achieve and maintain, compliance with our contractual
obligations and with all regulatory requirements applicable to our current and future product candidates or approved products, if
any; |
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our
ability to successfully develop a commercial strategy and thereafter commercialize our product candidates in the United States and
internationally, if approved for marketing, sale and distribution in such countries and territories, whether alone or in collaboration
with others; |
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the
availability of coverage and adequate reimbursement from managed care plans, private insurers, government payors (such as Medicare
and Medicaid) and other third-party payors for any of our product candidates that may be approved; |
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the
convenience of our treatment or dosing regimen; |
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acceptance
by physicians, payors and patients of the benefits, safety and efficacy of our product candidates, if approved, including relative
to alternative and competing treatments; |
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the
willingness of physicians, operators of hospitals and clinics and patients to utilize or adopt our therapeutic approaches; |
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patient
demand for our current or future product candidates, if approved; |
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our
ability to establish and enforce intellectual property rights in and to our product candidates; and |
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our
ability to avoid third-party patent interference, intellectual property challenges or intellectual property infringement claims. |
These
factors, many of which are beyond our control, could cause us to experience significant delays or an inability to obtain regulatory approvals
or commercialize our current or future product candidates. Even if regulatory approvals are obtained, we may never be able to successfully
commercialize our product candidates. Accordingly, we cannot provide assurances that we will be able to generate sufficient revenue through
the sale of our product candidates to continue our business or achieve profitability.
Our
pipeline is based on novel ideas and technologies that are unproven and may not result in marketable products, which exposes us
to unforeseen risks and makes it difficult for us to predict the time and cost of product development and potential for regulatory approval.
We
are using our technology to develop product candidates to treat rare diseases, inflammatory disorders and cancer. Our foundational science
and product development approach are based on our ability to deliver our drug candidates to target receptors and specified cells or tissues
at the site of disease to boost efficacy while abating adverse effects on healthy tissue. We believe that this approach may offer an
improved therapeutic effect by delivering drug candidates to areas which may alleviate symptoms and/or treat diseased tissue. However,
this approach to treating these diseases is novel and the clinical research that results in a product candidate has had limited testing
in humans. For our early-stage, preclinical compounds, we are in the process of validating different tumor-specific therapeutic product
candidates. We may spend substantial funds attempting to develop these products with our approach and never succeed in developing a marketable
therapeutic.
As
such, we cannot assure you that even if we are able to develop product candidates to treat the diseases we are targeting, such therapies
would safely and effectively treat such diseases. We may spend substantial funds attempting to develop this approach and never succeed
in developing a marketable therapeutic. We are unable to predict when or if our drug candidates will prove effective or safe in humans
or if we will obtain marketing approval. Before obtaining marketing approval from regulatory authorities for the sale of any drug candidate,
we must complete pre-clinical development and then conduct extensive clinical trials to demonstrate the safety and efficacy of our drug
candidates in humans. Clinical testing is expensive, difficult to design and implement, can take many years to complete and is uncertain
as to the outcome. A failure of one or more clinical trials can occur at any stage of testing. The outcome of pre-clinical testing and
early clinical trials may not be predictive of the success of later clinical trials, and interim or preliminary results of a clinical
trial do not necessarily predict final results. In particular, the small number of patients in our early clinical trials may make the
results of these trials less predictive of the outcome of later clinical trials.
We
may experience numerous unforeseen events during, or as a result of, clinical trials that could delay or prevent our ability to obtain
marketing approval or commercialize our drug candidates, including:
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regulators
or institutional review boards (“IRBs”)/ethics committees (“ECs”) may not authorize us or our investigators
to commence a clinical trial or conduct a clinical trial at a prospective trial site; |
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we
may experience delays in reaching, or fail to reach, agreement on acceptable clinical trial contracts or clinical trial protocols
with prospective trial sites; |
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clinical
trials for our drug candidates may produce negative or inconclusive results, and we may decide, or regulators may require us, to
conduct additional clinical trials, delay clinical trials or abandon product development programs; |
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the
number of patients required for clinical trials for our drug candidates may be larger than we anticipate, enrollment in these clinical
trials may be slower than we anticipate, participants may drop out of these clinical trials at a higher rate than we anticipate or
the duration of these clinical trials may be longer than we anticipate; |
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competition
for clinical trial participants from investigational and approved therapies may make it more difficult to enroll patients in our
clinical trials; |
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we
or third-party collaborators may fail to obtain the clearance or approval of companion diagnostic tests, if required, on a timely
basis, or at all; |
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our
third-party contractors may fail to meet their contractual obligations to us in a timely manner, or at all, or may fail to comply
with regulatory requirements; |
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we
may have to suspend or terminate clinical trials for our drug candidates for various reasons, including a finding that the participants
are being exposed to unacceptable health risks; |
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our
drug candidates may have undesirable or unexpected side effects or other unexpected characteristics, causing us or our investigators,
regulators or IRBs/ECs to suspend or terminate the trials; |
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the
cost of clinical trials for our drug candidates may be greater than we anticipate; |
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the
supply or quality of our drug candidates or other materials necessary to conduct clinical trials for our drug candidates may be insufficient
or inadequate and result in delays or suspension of our clinical trials; and |
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we
or a diagnostic development partner may fail to receive regulatory approval of a companion diagnostic for use with a marketed product. |
Our
product development costs will increase if we experience delays in pre-clinical studies or clinical trials or in obtaining marketing
approvals. We do not know whether any of our planned pre-clinical studies or clinical trials will begin on a timely basis or at all,
will need to be restructured or will be completed on schedule, or at all. For example, the FDA may place a partial or full clinical hold
on any of our clinical trials for a variety of reasons.
Significant
pre-clinical or clinical trial delays also could shorten any periods during which we may have the exclusive right to commercialize our
drug candidates or allow our competitors to bring products to market before we do and impair our ability to successfully commercialize
our drug candidates and may harm our business and results of operations.
Any
delays in the commencement or completion, or termination or suspension, of our ongoing, planned or future clinical trials could result
in increased costs to us, delay or limit our ability to generate revenue and adversely affect our commercial prospects.
Before
we can initiate clinical trials of a drug candidate in any indication, we must submit the results of pre-clinical studies to the FDA
along with other information, including information about the drug candidate’s chemistry, manufacturing and controls and our proposed
clinical trial protocol, as part of an IND or similar regulatory filing.
Before
obtaining marketing approval from the FDA for the sale of our product candidate in any indication, we must conduct extensive clinical
studies to demonstrate safety and efficacy. Clinical testing is expensive, time consuming and uncertain as to outcome. In addition, we
expect to rely in part on pre-clinical, clinical and quality data generated by our CROs and other third parties for regulatory submissions
for our drug candidates. While we have or will have agreements governing these third parties’ services, we have limited influence
over their actual performance. If these third parties do not make data available to us, or, if applicable, make regulatory submissions
in a timely manner, in each case pursuant to our agreements with them, our development programs may be significantly delayed and we may
need to conduct additional studies or collect additional data independently. In either case, our development costs would increase. In addition, we will need to initiate clinical trials for TH104. In addition, we will need to receive FDA clearance
of our IND for TH3215, TH0059 and TH1940 before we can begin clinical trials and would require the same acceptance by the FDA prior to
initiating any clinical trials in the United States for any of our other drug candidates. The FDA may require us to conduct additional
pre-clinical studies for any drug candidate before it allows us to initiate clinical trials under any IND, which may lead to additional
delays and increase the costs of our pre-clinical development programs.
Any
delays in the commencement or completion of our ongoing, planned or future clinical trials could significantly affect our product development
costs. We do not know whether our planned trials will begin on time or at all, or be completed on schedule, if at all. The commencement
and completion of clinical trials can be delayed for a number of reasons, including delays related to:
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the FDA disagreeing
as to the design or implementation of our clinical trials or with our recommended dose for any of our pipeline programs; |
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obtaining FDA
authorization to commence a trial or reaching a consensus with the FDA on trial design; |
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failing to obtain regulatory
clearance or approval of companion diagnostics we may use to identify patients for enrollment in our clinical trials; |
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any failure or delay in
reaching an agreement with CROs and clinical trial sites, the terms of which can be subject to extensive negotiation and may vary
significantly among different CROs and trial sites; |
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obtaining approval from
one or more IRBs/ECs; |
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IRBs/ECs refusing to approve,
suspending or terminating the trial at an investigational site, precluding enrollment of additional subjects, or withdrawing their
approval of the trial; |
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changes to clinical trial
protocol; |
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clinical sites deviating
from trial protocol or dropping out of a trial; |
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failing to manufacture
or obtain sufficient quantities of drug candidate or, if applicable, combination therapies for use in clinical trials; |
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patients failing to enroll
or remain enrolled in our trials at the rates we expect, or failing to return for post-treatment follow-ups; |
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patients choosing an alternative
treatment, or participating in competing clinical trials; |
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lack of adequate funding
to continue clinical trials; |
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patients experiencing severe
or unexpected drug-related adverse effects; |
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occurrence of serious adverse
events in trials of the same class of agents conducted by other companies; |
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selecting or
being required to use clinical end points that require prolonged periods of clinical observation or analysis of the resulting data; |
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a facility manufacturing
our drug candidates or any of their components being ordered by the FDA to temporarily or permanently shut down due to violations
of cGMP regulations or other applicable requirements, or infections or cross-contaminations of drug candidates in the manufacturing
process; |
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any changes to our manufacturing
process that may be necessary or desired; |
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third-party
clinical investigators losing the licenses or permits necessary to perform our clinical trials, not performing our clinical trials
on our anticipated schedule or consistent with the clinical trial protocol Good Clinical Practice
(“GCP”) or other regulatory requirements; |
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us, or our third-party
contractors not performing data collection or analysis in a timely or accurate manner or improperly disclosing data prematurely or
otherwise in violation of a clinical trial protocol; or |
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third-party contractors
becoming debarred or suspended or otherwise penalized by the FDA or other government or regulatory authorities for violations of
regulatory requirements, in which case we may need to find a substitute contractor, and we may not be able to use some or all of
the data produced by such contractors in support of our marketing applications. |
We
could also encounter delays if a clinical trial is suspended or terminated by us, by the IRBs/ECs of the institutions in which such trials
are being conducted, by a Data Safety Monitoring Board for such trial or by the FDA. Such authorities may impose such a suspension or
termination due to a number of factors, including failure to conduct the clinical trial in accordance with regulatory requirements or
our clinical protocols, inspection of the clinical trial operations or trial site by the FDA resulting in the imposition of a clinical
hold, unforeseen safety issues or adverse side effects, failure to demonstrate a benefit from using a pharmaceutical, changes in governmental
regulations or administrative actions or lack of adequate funding to continue the clinical trial. In addition, changes in regulatory
requirements and policies may occur, and we may need to amend clinical trial protocols to comply with these changes. Amendments may require
us to resubmit our clinical trial protocols to IRBs/ECs for reexamination, which may impact the costs, timing or successful completion
of a clinical trial.
Certain
of our scientific advisors or consultants who receive compensation from us are investigators for our clinical trial. Under certain circumstances,
we may be required to report some of these relationships to the FDA. Although we believe our existing relationships are within the FDA’s
guidelines, the FDA may conclude that a financial relationship between us and a principal investigator has created a conflict of interest
or otherwise affected interpretation of the study. The FDA may therefore question the integrity of the data generated at the applicable
clinical trial site and the utility of the clinical trial itself may be jeopardized. This could result in a delay in approval, or rejection,
of our marketing applications by the FDA and may ultimately lead to the denial of marketing approval of our product candidates. If we
experience delays in the completion of, or termination of, any clinical trial of our drug candidates, the commercial prospects of such
drug candidate will be harmed, and our ability to generate product revenues will be delayed. Moreover, any delays in completing our clinical
trials will increase our costs, slow down our development and approval process and jeopardize our ability to commence product sales and
generate revenues which may harm our business, financial condition, results of operations and prospects significantly.
The
outcome of pre-clinical testing and early clinical trials may not be predictive of the success of later clinical trials, and the results
of our clinical trials may not satisfy the requirements of the FDA, European Medicines Agency (“EMA”) or other comparable
foreign regulatory authorities.
We
will be required to demonstrate with substantial evidence through well-controlled clinical trials that our product candidates are safe
and effective for use in a diverse population before we can seek marketing approvals for their commercial sale. Success in pre-clinical
studies and early-stage clinical trials does not mean that future clinical trials will be successful. Product candidates in later-stage
clinical trials may fail to demonstrate sufficient safety and efficacy to the satisfaction of the FDA, EMA and other comparable foreign
regulatory authorities despite having progressed through pre-clinical studies and early-stage clinical trials. Regulatory authorities
may also limit the scope of later-stage trials until we have demonstrated satisfactory safety, which could delay regulatory approval,
limit the size of the patient population to which we may market our product candidates, or prevent regulatory approval.
In
some instances, there can be significant variability in safety and efficacy results between different clinical trials of the same product
candidate due to numerous factors, including changes in trial protocols, differences in size and type of the patient populations, differences
in and adherence to the dose and dosing regimen and other trial protocols and the rate of dropout among clinical trial participants.
Patients treated with our product candidates may also be undergoing surgical, radiation and chemotherapy treatments and may be using
other approved products or investigational new drugs, which can cause side effects or adverse events that are unrelated to our product
candidates. As a result, assessments of efficacy can vary widely for a particular patient and from patient to patient and site to site
within a clinical trial. This subjectivity can increase the uncertainty of, and adversely impact, our clinical trial outcomes.
We
do not know whether any clinical trials we may conduct will demonstrate consistent or adequate efficacy and safety sufficient to obtain
approval to market any of our product candidates.
Interim,
topline and preliminary data from our clinical trials that we announce or publish from time to time may change as more patient data becomes
available, and are subject to audit and verification procedures that could result in material changes in the final data.
From
time to time, we may publicly disclose preliminary, interim or topline data from our clinical trials, such as the interim data from clinical
trials related to TH104, or preclinical data for TH3215, TH0059 or TH1940. These interim updates are based on a preliminary analysis
of then-available data, and the results and related findings and conclusions are subject to change following a more comprehensive review
of the data related to the particular study or trial. For example, we may report responses in certain patients that are unconfirmed at
the time and which do not ultimately result in confirmed responses to treatment after follow-up evaluations. We also make assumptions,
estimations, calculations and conclusions as part of our analyses of data, and we may not have received or had the opportunity to fully
and carefully evaluate all data. As a result, the topline results that we report may differ from future results of the same studies,
or different conclusions or considerations may qualify such results, once additional data have been received and fully evaluated. Topline
data also remain subject to audit and verification procedures that may result in the final data being materially different from the preliminary
data we previously published. As a result, topline data should be viewed with caution until the final data are available. In addition,
we may report interim analyses of only certain endpoints rather than all endpoints. Interim data from clinical trials that we may complete
are subject to the risk that one or more of the clinical outcomes may materially change as patient enrollment continues and more patient
data become available. Adverse changes between interim data and final data could significantly harm our business and prospects. Further,
additional disclosure of interim data by us or by our competitors in the future could result in volatility in the price of our common
stock.
In
addition, the information we choose to publicly disclose regarding a particular study or clinical trial is typically selected from a
more extensive amount of available information. You or others may not agree with what we determine is the material or otherwise appropriate
information to include in our disclosure, and any information we determine not to disclose may ultimately be deemed significant with
respect to future decisions, conclusions, views, activities or otherwise regarding a particular product candidate or our business. If
the preliminary or topline data that we report differs from late, final or actual results, or if others, including regulatory authorities,
disagree with the conclusions reached, our ability to obtain approval for and commercialize our product candidates may be harmed, which
could harm our business, financial condition, results of operations and prospects.
If
we experience delays or difficulties in enrolling patients in our ongoing or planned clinical trials, our receipt of necessary regulatory
approval could be delayed or prevented.
We
may not be able to initiate or continue our ongoing or planned clinical trials for our product candidates if we are unable to identify
and enroll a sufficient number of eligible patients to participate in these trials as required by the FDA. Even once enrolled, we
may be unable to retain a sufficient number of patients to complete any of our trials. Patient enrollment is a significant factor
in the timing of clinical trials. Our ability to enroll eligible patients may be limited or may result in slower enrollment than we anticipate.
Patient
enrollment may be affected if our competitors have ongoing clinical trials for programs that are under development for the same indications
as our product candidates, and patients who would otherwise be eligible for our clinical trials instead enroll in clinical trials of
our competitors’ programs. Patient enrollment for our current or any future clinical trials may be affected by other factors, including:
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size
and nature of the patient population; |
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severity
of the disease under investigation; |
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the design of the trial and the complexity for patients
and clinical sites; |
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availability
and efficacy of approved drugs for the disease under investigation; |
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patient
eligibility criteria for the trial in question as defined in the protocol; |
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perceived
risks and benefits of the product candidate under study; |
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clinicians’
and patients’ perceptions as to the potential advantages of the product candidate being studied in relation to other available
therapies, including any new products that may be approved or other product candidates being investigated for the indications we
are investigating; |
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clinicians’
willingness to screen their patients for biomarkers to indicate which patients may be eligible for enrollment in our clinical trials; |
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the ability to obtain and maintain patient consents; |
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patient
referral practices of physicians; |
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the
ability to monitor patients adequately during and after treatment; |
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proximity
and availability of clinical trial sites for prospective patients; and |
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the
risk that patients enrolled in clinical trials will drop out of the trials before completion or, because they may be late-stage disease
patients and will not survive the full terms of the clinical trials. |
Our
inability to enroll a sufficient number of patients for our clinical trials would result in significant delays or may require us to abandon
one or more clinical trials altogether. Any negative results we may report in clinical trials of our product candidates may make it
difficult or impossible to recruit and retain patients in other clinical trials of that same product candidate. Enrollment delays
in our clinical trials may result in increased development costs for our product candidates and jeopardize our ability to obtain marketing
approval for the sale of our product candidates. Furthermore, even if we are able to enroll a sufficient number of patients for our clinical
trials, we may have difficulty maintaining participation in our clinical trials through the treatment and any follow-up periods.
We
may never receive approval to market and commercialize any product candidate. Even if we obtain regulatory approval, the approval may
be for targets, disease indications, lines of therapy or patient populations that are not as broad as we intended or desired or may require
labeling that includes significant use or distribution restrictions or safety warnings.
We
have not previously submitted an NDA to the FDA or similar regulatory approval filings to comparable foreign authorities, for any product
candidate, and we cannot be certain that our product candidates will be successful in clinical trials or receive regulatory approval.
Further, any future product candidates may not receive regulatory approval even if they are successful in clinical trials. If we do not
receive regulatory approvals for our product candidates, we may not be able to continue our operations. Even if we successfully obtain
regulatory approvals to market a product candidate, our revenue will be dependent, in part, upon the size of the markets in the territories
for which we gain regulatory approval and have commercial rights. If the markets or patient subsets that we are targeting are not as
significant as we estimate, we may not generate significant revenues from sales of such products, if approved.
We
plan to seek regulatory approval to commercialize our product candidates both in the United States and in selected foreign countries.
While the scope of regulatory approval generally is similar in other countries, in order to obtain separate regulatory approval in other
countries we must comply with numerous and varying regulatory requirements of such countries regarding safety and efficacy. Other countries
also have their own regulations governing, among other things, clinical trials and commercial sales, as well as pricing and distribution
of our product candidates, and we may be required to expend significant resources to obtain regulatory approval and to comply with ongoing
regulations in these jurisdictions.
We
may be required to perform additional or unanticipated clinical trials to obtain approval or be subject to post-marketing testing requirements
to maintain regulatory approval. If our candidates prove to be ineffective, unsafe or commercially unviable, our pipeline would have little, if any, value, which would have a material and adverse effect on our business, financial condition, results
of operations and prospects.
TH104,
TH3215, TH0059 and TH1940 are novel product candidates, making it difficult to predict the time, cost and potential success of
these product candidates. We have not yet been able to assess the safety and efficacy of any product candidates in humans. Our success
depends on our ability to develop and commercialize product candidates. The novel nature of some of our technology makes
it difficult to accurately predict the developmental challenges we may face for product candidates as they proceed through research,
pre-clinical or greenhouse studies and clinical or field trials.
Because
our pre-clinical research programs are all research or pre-clinical stages, we have not yet been able to assess the safety or efficacy
of any product candidates in humans. If our product candidates do not achieve projected development milestones or commercialization in
the announced or expected timeframes, the further development or commercialization of such product candidates may be delayed, and our
business may be harmed. Current or future product candidates may not meet safety and efficacy requirements for continued development
or ultimate approval in humans and may cause significant adverse events or toxicities.
Adverse
side effects or other safety risks associated with our drug candidates could delay or preclude approval, cause us to suspend or discontinue
clinical trials or abandon further development, limit the commercial profile of an approved label, or result in significant negative
consequences following marketing approval, if any.
Results
of our planned clinical trials could reveal a high and unacceptable severity and prevalence of side effects or unexpected characteristics.
Undesirable side effects caused by our drug candidates could result in the delay, suspension or termination of clinical trials by us
or the FDA for a number of reasons. If we elect or are required to delay, suspend or terminate any clinical trial, the commercial prospects
of our drug candidates will be harmed and our ability to generate product revenues from this drug candidate will be delayed or eliminated.
Serious adverse events observed in clinical trials could hinder or prevent market acceptance of our drug candidates. Any of these occurrences
may harm our business, prospects, financial condition and results of operations significantly.
Moreover,
if our drug candidates are associated with undesirable side effects in clinical trials or have characteristics that are unexpected, we
may elect to abandon or limit their development to more narrow uses or subpopulations in which the undesirable side effects or other
characteristics are less prevalent, less severe or more acceptable from a risk-benefit perspective, which may limit the commercial expectations
for our drug candidates, if approved. We may also be required to modify our study plans based on findings in our clinical trials. Many
drugs that initially showed promise in early-stage testing have later been found to cause side effects that prevented further
development. In addition, regulatory authorities may draw different conclusions or require additional testing to confirm these determinations.
It
is possible that as we test our drug candidates in larger, longer and more extensive clinical trials, including with different dosing
regimens, or as the use of our drug candidates becomes more widespread following any regulatory approval, illnesses, injuries, discomforts
and other adverse events that were observed in earlier trials, as well as conditions that did not occur or went undetected in previous
trials, will be reported by patients. If such side effects become known later in development or upon approval, if any, such findings
may harm our business, financial condition, results of operations and prospects significantly.
In
addition, if any of our drug candidates receive marketing approval, and we or others later identify undesirable side effects caused by
treatment with such drug, a number of potentially significant negative consequences could result, including:
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regulatory
authorities may withdraw approval of the drug; |
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we
may be required to recall a product, change the dosage of a product, or change the way the drug is administered to patients; |
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regulatory
authorities may require additional warnings on the label, such as a “black box” warning or a contraindication, or issue
safety alerts, Dear Healthcare Provider letters, press releases or other communications containing warnings or other safety information
about the product; |
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we may be required to implement
a REMS or create a medication guide outlining the risks of such side effects for distribution to patients; |
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additional restrictions
may be imposed on the marketing or promotion of the particular product or the manufacturing processes for the product or any component
thereof; |
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we could be sued and held
liable for harm caused to patients; |
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the drug could become less
competitive; and |
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our reputation may suffer. |
Any
of these events could prevent us from achieving or maintaining market acceptance of our drug candidates, if approved, and could significantly
harm our business, financial condition, results of operations and prospects.
We
sometimes estimate, or may in the future estimate, the timing of the accomplishment of various scientific, clinical, manufacturing, regulatory
and other product development objectives. These milestones may include our expectations regarding the commencement or completion of scientific
studies or clinical trials, the submission of regulatory filings, the receipt of marketing approval or the realization of other commercialization
objectives.
The
achievement of milestones such as the timing of the accomplishment of various scientific, clinical, manufacturing, regulatory and other
product development objectives may be outside of our control. All of these milestones are based on a variety of assumptions, including
assumptions regarding capital resources, constraints and priorities, progress of and results from development activities and the receipt
of key regulatory approvals or actions, any of which may cause the timing of achievement of the milestones to vary considerably from
our estimates. If we or our collaborators fail to achieve announced milestones in the expected timeframes, the commercialization of our
product candidates may be delayed, our credibility may be undermined, our business and results of operations may be harmed, and the price
of our common stock may decline.
If
a product liability claim is successfully brought against us for uninsured liabilities, or such claim exceeds our insurance coverage,
we could be forced to pay substantial damage awards that could materially harm our business.
The
use of any of our existing or future product candidates in clinical trials and the sale of any approved pharmaceutical products may expose
us to significant product liability claims. We currently do not have product liability insurance coverage but we intend to obtain such
insurance. Such insurance coverage may not protect us against any or all of the product liability claims that may be brought against
us in the future. We may not be able to acquire or maintain adequate product liability insurance coverage at a commercially reasonable
cost or in sufficient amounts or scope to protect us against potential losses. In the event a product liability claim is brought against
us, we may be required to pay legal and other expenses to defend the claim, as well as uncovered damage awards resulting from a claim
brought successfully against us. In the event our product candidate is approved for sale by the FDA or other regulatory agency and commercialized,
we may need to substantially increase the amount of our product liability coverage. Defending any product liability claim or claims could
require us to expend significant financial and managerial resources, which could have an adverse effect on our business.
Our
current and future products may never achieve significant commercial market acceptance.
Our
success depends on the market’s confidence that we can provide therapeutic products that improve clinical outcomes, lower healthcare
costs and enable better biopharmaceutical development. Failure of our products, or those jointly developed with our collaborators, to
perform as expected could significantly impair our operating results and our reputation. We believe patients, clinicians, academic institutions
and biopharmaceutical companies are likely to be particularly sensitive to defects, errors, inaccuracies, delays and toxicities in or
associated with our products. Furthermore, inadequate performance of these products may result in lower confidence in our pipeline
in general.
We
may not succeed in achieving significant commercial market acceptance for our current or future products due to a number of factors,
including:
● |
our
ability to demonstrate the clinical utility of our pipeline and related products and their potential advantages over existing
drug products to academic institutions, biopharmaceutical companies and the medical community; |
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our ability, and that of
our collaborators, to secure and maintain FDA and other regulatory clearance, authorization or approval for our products; |
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the agreement by third-party
payors to reimburse our products, the scope and extent of which will affect patients’ willingness or ability to pay for our
products and will likely heavily influence physicians’ decisions to recommend our products; |
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the
rate of adoption of our pipeline and related products by academic institutions, clinicians, key opinion leaders, advocacy
groups and biopharmaceutical companies; and |
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the impact of our investments
in product innovation and commercial growth. |
Additionally,
our customers and collaborators may decide to decrease or discontinue their use of our products due to changes in their research and
development plans, failures in their clinical trials, financial constraints, the regulatory environment, negative publicity about our
products, competing products or the reimbursement landscape, all of which are circumstances outside of our control. We may not be successful
in addressing these or other factors that might affect the market acceptance of our products. Failure to achieve widespread market acceptance
of our pipeline and related products would materially harm our business, financial condition and results of operations.
Pandemics,
such as COVID-19, may adversely impact our business, results of operations, financial condition, liquidity and cash flows and that of
our clients.
The
COVID-19 pandemic and efforts to control its spread had an impact on our operations. For
example, as a result of COVID-19, we previously experienced delays from our manufacturers with respect to the shipping of our materials
as well as delays in completion of analytical testing as a result of the shelter-in-place order restrictions. Pandemics, such as COVID-19,
may have a material economic effect on our business because our research and development may be affected as a result of delays in study
monitoring and data analysis; some participants and clinical investigators may not be able to comply with clinical trial protocols; any
quarantines or other travel limitations (whether voluntary or required) may impede participant movement, affect sponsor access to study
sites, or interrupt healthcare services, resulting in our inability to conduct our research activities, including our clinical trials;
and infections and deaths related to a pandemic may disrupt the United States’ healthcare and healthcare regulatory systems which
could divert healthcare resources away from, or materially delay FDA review and/or approval of our product candidates. While the potential
economic impact brought by such pandemics may be difficult to assess or predict, it has caused, and may result in further significant
disruption of global financial markets, which may reduce our ability to access capital either at all or on favorable terms. In addition,
a recession, depression or other sustained adverse market event resulting from a health pandemic could materially and adversely affect
our business and the value of our common stock.
We
may expend our limited resources to pursue a particular drug candidate or indication and fail to capitalize on drug candidates or indications
that may be more profitable or for which there is a greater likelihood of success.
Because
we have limited financial and managerial resources, we focus on research programs and drug candidates that we identify for specific indications.
As a result, we may forego or delay pursuit of opportunities with other drug candidates or for other indications that later prove to
have greater commercial potential. Our resource allocation decisions may cause us to fail to capitalize on viable commercial products
or profitable market opportunities. Our spending on current and future research and development programs and drug candidates for specific
indications may not yield any commercially viable products. If we do not accurately evaluate the commercial potential or target market
for a particular drug candidate, we may relinquish valuable rights to that drug candidate through collaboration, licensing or other royalty
arrangements in cases in which it would have been more advantageous for us to retain sole development and commercialization rights to
such drug candidate.
We
may not be successful in our efforts to design additional potential drug candidates.
The
therapeutic design and development activities that we are conducting may not be successful in developing drug candidates that are useful
in treating rare diseases, inflammatory conditions, cancer or other diseases. Our research programs may initially show promise in identifying
potential drug candidates, yet fail to yield drug candidates for clinical development for a number of reasons, including:
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the research
methodology used may not be successful in identifying potential drug candidates; |
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potential
drug candidates may, on further study, be shown to have harmful side effects or other characteristics that indicate that they are
unlikely to be drugs that will obtain marketing approval or achieve market acceptance; or |
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potential drug candidates
may not be effective in treating their targeted diseases. |
Research
programs to identify and design new drug candidates require substantial technical, financial and human resources. We may choose to focus
our efforts and resources on a potential drug candidate that ultimately proves to be unsuccessful. If we are unable to identify and design
suitable drug candidates for pre-clinical and clinical development, we will not be able to obtain revenues from the sale of products
in future periods, which likely would result in significant harm to our financial position and adversely impact our stock price.
We
face significant competition, and if our competitors develop and market technologies or products more rapidly than we do or that are
more effective, safer or less expensive than the products we develop, our commercial opportunities will be negatively impacted.
The
biotechnology and pharmaceutical industries are characterized by rapidly advancing technologies, intense competition and a strong emphasis
on proprietary and novel products and product candidates. Our competitors have developed, are developing or may develop products, product
candidates and processes competitive with ours. Any product candidates that we successfully develop and commercialize will compete with
existing therapies and new therapies that may become available in the future. We believe that a significant number of products are currently
under development, and may become commercially available in the future, for the treatment of conditions for which we may attempt to develop
product candidates. In addition, our products may need to compete with drugs physicians use off-label to treat the indications for which
we seek approval. This may make it difficult for us to replace existing therapies with our products.
In
particular, there is intense competition in the fields of rare diseases, inflammatory conditions and oncology. We have competitors both
in the United States and internationally, including major multinational pharmaceutical companies, established biotechnology companies,
specialty pharmaceutical companies, emerging and start-up companies, universities and other research institutions. We also compete with
these organizations to recruit management, scientists and clinical development personnel, which could negatively affect our level of
expertise and our ability to execute our business plan. We will also face competition in establishing clinical trial sites, enrolling
subjects for clinical trials and in identifying and in-licensing new product candidates.
Our
commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products that are safer, more effective,
have fewer side effects, are more convenient, have a broader label, are marketed more effectively, are more widely reimbursed or are
less expensive than any products that we may develop. Our competitors also may obtain marketing approval from the FDA, EMA or other comparable
foreign regulatory authorities for their products more rapidly than we may obtain approval for ours, which could result in our competitors
establishing a strong market position before we are able to enter the market. Even if the product candidates we develop achieve marketing
approval, they may be priced at a significant premium over competitive products if any have been approved by then, resulting in reduced
competitiveness. Technological advances or products developed by our competitors may render our technologies or product candidates obsolete,
less competitive or not economical. If we are unable to compete effectively, our opportunity to generate revenue from the sale of our
products we develop may be adversely affected.
We
are subject to healthcare laws and regulations.
Sales
of our product candidates, if approved, or any other future product candidate will be subject to healthcare regulation and enforcement
by the federal government and the states and foreign governments in which we might conduct our business. The healthcare laws and regulations
that may affect our ability to operate include the following:
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The federal
Anti-Kickback Statute makes it illegal for any person or entity to knowingly and willfully, directly or indirectly, solicit, receive,
offer, or pay any remuneration that is in exchange for or to induce the referral of business, including the purchase, order, lease
of any good, facility, item or service for which payment may be made under a federal healthcare program, such as Medicare or Medicaid.
The term “remuneration” has been broadly interpreted to include anything of value. |
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Federal false
claims and false statement laws, including the federal civil False Claims Act and the Civil
Monetary Penalties Law (“CMPL”), prohibits, among other things, any person or entity from knowingly presenting,
or causing to be presented, for payment to, or approval by, federal programs, including Medicare and Medicaid, claims for items or
services, including drugs, that are false or fraudulent. |
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Health Insurance Portability
and Accountability Act of 1996 (“HIPAA”) created additional federal criminal statutes that prohibit among other actions,
knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program, including private
third-party payors or making any false, fictitious or fraudulent statement in connection with the delivery of or payment for healthcare
benefits, items or services. |
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HIPAA, as amended by the
Health Information Technology for Economic and Clinical Health Act of 2009 and their implementing regulations, impose obligations
on certain types of individuals and entities regarding the electronic exchange of information in common healthcare transactions,
as well as standards relating to the privacy and security of individually identifiable health information. |
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The Federal Food, Drug
and Cosmetic Act, which governs the production, sale, distribution, promotion and sampling of drugs, biologics and medical devices
and prohibits, among other things, the adulteration or misbranding of drugs, biologics and medical devices including marketing drug
products for off-label use; |
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The federal Physician Payments
Sunshine Act requires certain manufacturers of drugs, devices, biologics and medical supplies for which payment is available under
Medicare, Medicaid or the Children’s Health Insurance Program, with specific exceptions, to report annually to the Centers
for Medicare & Medicaid Services information related to payments or other transfers of value made to physicians (defined to include
doctors, dentists, optometrists, podiatrists, and chiropractors), certain other healthcare professionals (such as physician assistants
and nurse practitioners), and teaching hospitals, as well as ownership and investment interests held by physicians and their immediate
family members and applicable group purchasing organizations. |
Also,
many states have similar laws and regulations, such as anti-kickback and false claims laws that may be broader in scope and may apply
regardless of payor, in addition to items and services reimbursed under Medicaid and other state programs. Additionally, we may be subject
to state laws that require pharmaceutical companies to comply with the federal government’s and/or pharmaceutical industry’s
voluntary compliance guidelines, state laws that require drug manufacturers to report information related to payments and other transfers
of value to physicians and other healthcare providers or marketing expenditures and state laws requiring the registration of sales representatives,
as well as state and foreign laws governing the privacy and security of health information, many of which differ from each other in significant
ways and often are not preempted by HIPAA.
The
laws and regulations applicable to our business are complex, changing and often subject to varying interpretations. As a result, we may
not be able to adhere to all applicable laws and regulations. Any violation or alleged violation of any of these laws or regulations
by us could have a material adverse effect on our business, financial condition, cash flows and results of operations. We may be a party
to various lawsuits, demands, claims, qui tam suits, third-party complaints to the FDA, government investigations and audits,
of which any could result in, among other things, substantial financial penalties or awards against us, reputational harm, termination
of relationships or contracts related to our business, mandated refunds, substantial payments made by us, required changes to our business
practices, exclusion from future participation in Medicare and other healthcare programs and possible criminal penalties.
If
we are found in violation of applicable laws or regulations, we could suffer severe consequences that would have a material adverse effect
on our business, results of operations, financial condition, cash flows, reputation and stock price, including:
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suspension
or termination of our participation in federal healthcare programs; |
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criminal
or civil liability, fines, damages or monetary penalties for violations of healthcare fraud and abuse laws, including the federal
False Claims Act, CMPL, and Anti-Kickback Statute; |
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enforcement
actions by governmental agencies or claims for monetary damages by patients under federal or state patient privacy laws, including
HIPAA; |
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repayment
of amounts received in violation of law or applicable payment program requirements, and related monetary penalties; |
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mandated
changes to our practices or procedures that materially increase operating expenses; |
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imposition
of corporate integrity agreements that could subject us to ongoing audits and reporting requirements as well as increased scrutiny
of our business practices; |
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termination
of various relationships or contracts related to our business; and |
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harm
to our reputation which could negatively affect our business relationships, decrease our ability to attract or retain patients and
physicians, decrease access to new business opportunities and impact our ability to obtain financing, among other things. |
Responding
to lawsuits and other proceedings as well as defending ourselves in such matters will continue to require management’s attention
and cause us to incur significant legal expense. It is also possible that criminal proceedings may be initiated against us or individuals
in our business in connection with investigations by the federal government.
Furthermore,
to the extent that our product is sold in a foreign country, we may be subject to similar foreign laws.
If
we are unable to effectively adapt to changes in the healthcare industry, including changes to laws and regulations regarding or affecting
the U.S. healthcare reform, our business may be harmed.
Federal,
state and local legislative bodies frequently pass legislation and promulgate regulations relating to healthcare reform or that affect
the healthcare industry. We anticipate that there will continue to be increased government oversight and regulation of the healthcare
industry in the future. We cannot predict the ultimate content, timing or effect of any new healthcare legislation or regulations, nor
is it possible at this time to estimate the impact of potential new legislation or regulations on our business. It is possible that future
legislation enacted by Congress or state legislatures, or regulations promulgated by regulatory authorities at the federal or state level,
could adversely affect our business. We also cannot predict the outcome of any current or future litigation that may affect interpretation
of, or deference to, agency regulations and guidance.
The
FDA and other regulatory agencies actively enforce the laws and regulations prohibiting the promotion of off-label uses, and if we are
found to have improperly promoted off-label uses of our drugs or drug candidates, if approved, we may become subject to significant liability.
If
we are found to have improperly promoted off-label uses of our drugs or drug candidates, we may become subject to significant liability.
The FDA and other regulatory agencies strictly regulate the promotional claims that may be made about prescription drug products, such
as our drug candidates. In particular, a drug may not be promoted for uses that are not approved by the FDA or such other regulatory
agencies as reflected in the drug’s approved labeling, including a different dosage, delivery or patient population than is
contained in the label. If we receive marketing approval for our drug candidates for our proposed indications, physicians may nevertheless
use our drugs for their patients in a manner that is inconsistent with the approved label. However, if we are found to have promoted
our drugs for any off-label uses, the federal government could levy civil, criminal and/or administrative penalties, and seek fines against
us. The FDA or other regulatory authorities could also request that we enter into a consent decree or a corporate integrity agreement,
or seek a permanent injunction against us under which specified promotional conduct is monitored, changed or curtailed. If we cannot
successfully manage the promotion of our drug candidates, we could become subject to significant liability, which would materially adversely
affect our business and financial condition.
We
may not be able to obtain or maintain Fast Track designation or accelerated approval for our drug candidates.
If
a drug is intended for the treatment of a serious condition and nonclinical or clinical data demonstrate the potential to address unmet
medical need for this condition, a drug sponsor may apply for FDA Fast Track designation. If there are therapies already available
for the condition, a fast track drug must show an advantage over the available therapy including superior efficacy, lessening or avoidance
of side effects, improving the diagnosis of a serious condition, decreasing a clinical significant toxicity of an available therapy or
ability to address an emerging or anticipated public health need. If we seek Fast Track designation for a drug candidate, we may
not receive it from the FDA. However, even if we receive Fast Track designation, Fast Track designation does not ensure that we will
receive marketing approval or that approval will be granted within any particular time frame. We may not experience a faster development
or regulatory review or approval process with Fast Track designation compared to conventional FDA procedures. In addition, the FDA may
withdraw Fast Track designation if it believes that the designation is no longer supported by data from our clinical development program.
Fast Track designation alone does not guarantee qualification for the FDA’s priority review procedures.
We
may not be able to obtain or maintain orphan drug designation or exclusivity for our drug candidates.
Regulatory
authorities in some jurisdictions, including the United States, may designate drugs for relatively small patient populations as “orphan
drugs.” Under the Orphan Drug Act, the FDA may designate a drug candidate as an orphan drug if it is intended to treat a rare disease
or condition, which is generally defined as a patient population of fewer than 200,000 individuals in the United States, or if the disease
or condition affects more than 200,000 individuals in the United States and there is no reasonable expectation that the cost of developing
and making a drug product available in the United States for the type of disease or condition will be recovered from sales of the product.
Orphan
drug designation entitles a party to financial incentives, such as opportunities for grant funding towards clinical trial costs, tax
advantages and user-fee waivers. Additionally, if a product that has orphan designation subsequently receives the first FDA approval
for the disease or condition for which it has such designation, the product is entitled to orphan drug exclusivity. This means that the
FDA may not approve any other applications to market the same drug or biological product for the same indication for seven years, except
in certain circumstances, including proving clinical superiority (i.e., another product is safer, more effective or makes a major contribution
to patient care) to the product with orphan exclusivity. Competitors, however, may receive approval of different products for the indication
for which the orphan product has exclusivity, or obtain approval for the same product but for a different indication than that for which
the orphan product has exclusivity. In addition, exclusive marketing rights in the United States may be limited if we seek approval for
an indication broader than the orphan-designated indication or may be lost if the FDA later determines that the request for designation
was materially defective.
A
Breakthrough Therapy designation by the FDA for our drug candidates may not lead to a faster development or regulatory review or approval
process, and it does not increase the likelihood that our drug candidates will receive marketing approval.
Designation
as a breakthrough therapy is within the discretion of the FDA. Accordingly, even if we believe one of our drug candidates meets the criteria
for designation as a breakthrough therapy, the FDA may disagree and instead determine not to make such designation. Even if we receive
Breakthrough Therapy designation, the receipt of such designation for a drug candidate may not result in a faster development process,
review or approval compared to drugs considered for approval under conventional FDA procedures and does not assure ultimate approval
by the FDA. In addition, even if one or more of our drug candidates qualify as breakthrough therapies, the FDA may later decide that
the drugs no longer meet the conditions for qualification or decide that the time period for FDA review or approval will not be shortened.
We may seek a breakthrough therapy designation for some of our drug candidates. A breakthrough therapy is defined as a drug that is intended,
alone or in combination with one or more other drugs, to treat a serious or life-threatening disease or condition, and preliminary clinical
evidence indicates that the drug may demonstrate substantial improvement over existing therapies on one or more clinically significant
endpoints, such as substantial treatment effects observed early in clinical development. For drugs and biologics that have been designated
as breakthrough therapies, interaction and communication between the FDA and the sponsor of the trial can help to identify the most efficient
path for clinical development while minimizing the number of patients placed in ineffective control regimens. Drugs designated as breakthrough
therapies by the FDA are also eligible for accelerated approval.
Risks
Related to Our Reliance on Third Parties
We
rely on third parties to conduct our pre-clinical studies and clinical trials. If these third parties do not successfully perform their
contractual and regulatory duties or meet expected deadlines, we may not be able to obtain regulatory approval for or commercialize our
drug candidates and our business could be substantially harmed.
We
do not have the ability to independently conduct all aspects of our pre-clinical testing or clinical trials. As a result, we have relied
upon and plan to continue to rely upon third-party medical institutions, clinical investigators, contract laboratories and other third
party CROs to monitor and manage data for our ongoing pre-clinical and clinical programs. We rely on these parties for the execution
of our pre-clinical studies and clinical trials, and control only certain aspects of their activities. Nevertheless, we are responsible
for ensuring that each of our studies is conducted in accordance with the applicable protocol, legal, regulatory, and scientific standards,
and our reliance on the CROs does not relieve us of our regulatory responsibilities. We and our CROs are required to comply with current
GCP, which are regulations and guidelines enforced by the FDA, the Competent Authorities of the Member States of the European Economic
Area and comparable foreign regulatory authorities for all of our drugs in clinical development.
Regulatory
authorities enforce these current GCP through periodic inspections of trial sponsors, principal investigators and trial sites. If we
or any of our CROs fail to comply with applicable GCP, the clinical data generated in our clinical trials may be deemed unreliable and
the FDA, the EMA or comparable foreign regulatory authorities may require us to perform additional clinical trials before approving our
marketing applications. We cannot assure you that upon inspection by a given regulatory authority, such regulatory authority will determine
that any of our clinical trials comply with GCP regulations. In addition, our clinical trials must be conducted with products produced
under cGMP. Our failure to comply with these regulations may require us to repeat clinical trials, which would delay the regulatory approval
process.
If
any of our relationships with these third-party CROs terminate, we may not be able to enter into arrangements with alternative CROs or
to do so on commercially reasonable terms. In addition, our CROs are not our employees, and except for remedies available to us under
our agreements with such CROs, we cannot control whether or not they devote sufficient time and resources to our on-going clinical, nonclinical
and pre-clinical or clinical programs. If CROs do not successfully carry out their contractual duties or obligations or meet expected
deadlines, if they need to be replaced or if the quality or accuracy of the clinical data they obtain is compromised due to the failure
to adhere to our clinical protocols, regulatory requirements or for other reasons, our clinical trials may be extended, delayed or terminated
and we may not be able to obtain regulatory approval for or successfully commercialize our drug candidates. As a result, our results
of operations and the commercial prospects for our drug candidates would be harmed, our costs could increase and our ability to generate
revenues could be delayed.
Many
of the third parties with whom we contract may also have relationships with other commercial entities, including our competitors, for
whom they may also be conducting clinical trials or other drug development activities that could harm our competitive position. If the
third parties conducting our pre-clinical studies or our clinical trials do not perform their contractual duties or obligations, experience
work stoppages, do not meet expected deadlines, terminate their agreements with us or need to be replaced, or if the quality or accuracy
of the clinical data they obtain is compromised due to their failure to adhere to our clinical trial protocols or to GCP, or for any
other reason, we may need to enter into new arrangements with alternative third parties. Switching or adding additional CROs involves
additional cost and requires management time and focus. In addition, there is a natural transition period when a new CRO commences work.
As a result, delays occur, which can materially impact our ability to meet our desired clinical development timelines. Though we carefully
manage our relationships with our CROs, there can be no assurance that we will not encounter similar challenges or delays in the future
or that these delays or challenges will not have a material adverse impact on our business, financial condition and prospects.
Manufacturing
pharmaceutical products is complex and subject to product loss for a variety of reasons. We contract with third parties for the manufacture
of our drug candidates for pre-clinical testing and clinical trials and expect to continue to do so for commercialization. This reliance
on third parties increases the risk that we will not have sufficient quantities of our drug candidates or products or such quantities
at an acceptable cost or quality, which could delay, prevent or impair our development or commercialization efforts.
We
do not have any manufacturing facilities. We produce very small quantities of small molecules for evaluation in our research programs
in our laboratory. We rely, and expect to continue to rely, on third parties for the manufacture of our drug candidates for pre-clinical
and clinical testing, as well as for commercial manufacture if any of our drug candidates obtain marketing approval. This reliance on
third parties increases the risk that we will not have sufficient quantities of our drug candidates or products or such quantities at
an acceptable cost or quality, which could delay, prevent or impair our development or commercialization efforts.
We
may be unable to establish any agreements with third-party manufacturers or to do so on favorable terms. Even if we are able to establish
agreements with third-party manufacturers, reliance on third-party manufacturers entails additional risks, including:
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reliance
on the third party for regulatory, compliance and quality assurance; |
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operations
of our third-party manufacturers or suppliers could be disrupted by conditions unrelated to our business or operations, including
the bankruptcy of the manufacturer or supplier or the issuance of an FDA Form 483 notice or warning letter; |
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the
possible breach of the manufacturing agreement by the third party; |
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the
possible misappropriation of our proprietary information, including our trade secrets and know how; |
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the
possible termination or nonrenewal of the agreement by the third party at a time that is costly or inconvenient for us; |
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carrier
disruptions or increased costs that are beyond our control; and |
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failure
to deliver our drugs under specified storage conditions and in a timely manner. |
We
have only limited supply arrangements in place with respect to our drug candidates, and these arrangements do not extend to commercial
supply. We acquire many key materials on a purchase order basis. As a result, we do not have long-term committed arrangements with respect
to our drug candidates and other materials. If we obtain marketing approval for any of our drug candidates, we will need to establish
an agreement for commercial manufacture with a third party; however, no assurance can be provided that we will be able to enter into
a commercial manufacture agreement on reasonable terms, if at all.
Third-party
manufacturers may not be able to comply with cGMP or similar regulatory requirements outside of the United States. Our failure, or the
failure of our third-party manufacturers and suppliers, to comply with applicable regulations could result in sanctions being imposed
on us, including clinical holds, fines, injunctions, civil penalties, delays, suspension or withdrawal of approvals, license revocation,
seizures or recalls of drug candidates or products, operating restrictions and criminal prosecutions, any of which could significantly
and adversely affect supplies of our products. In addition, our third-party manufacturers and suppliers are subject to numerous environmental,
health and safety laws and regulations, including those governing the handling, use, storage, treatment and disposal of waste products,
and failure to comply with such laws and regulations could result in significant costs associated with civil or criminal fines and penalties
for such third parties. Based on the severity of regulatory actions that may be brought against these third parties in the future, our
clinical or commercial supply of drug and packaging and other services could be interrupted or limited, which could harm our business.
Our
drug candidates and any products that we may develop may compete with other drug candidates and products for access to manufacturing
facilities. As a result, we may not obtain access to these facilities on a priority basis or at all. There are a limited number of manufacturers
that operate under cGMP and that may be capable of manufacturing our product candidates.
As
we prepare for later-stage clinical trials and potential commercialization, we will need to take steps to increase the scale of production
of our drug candidates. Even minor deviations from normal manufacturing processes could result in reduced production yields, product
defects and other supply disruptions. If microbial, viral or other contaminations are discovered in our drug candidates or in the manufacturing
facilities in which our drug candidates are made, such manufacturing facilities may need to be closed for an extended period of time
to investigate and remedy the contamination.
Any
performance failure on the part of our existing or future manufacturers could delay clinical development or marketing approval. We do
not currently have arrangements in place for redundant supply or a second source for bulk drug substance. If our current contract manufacturers
for pre-clinical and clinical testing cannot perform as agreed, we may be required to replace such manufacturers. Although we believe
that there are several potential alternative manufacturers who could manufacture our drug candidates, we may incur added costs and delays
in identifying and qualifying any such replacement manufacturer or be able to reach agreement with any alternative manufacturer.
Our
current and anticipated future dependence upon others for the manufacture of our drug candidates or products may adversely affect our
future profit margins and our ability to commercialize any products that obtain marketing approval on a timely and competitive basis.
We
currently depend on a sole source supplier and manufacturer for the active ingredient in our product candidates and the inability to
obtain the active ingredient for our product candidates as required could harm our business.
We
currently source the active ingredient for TH1940, TH3215 and TH0059 from sole suppliers/manufacturers. In addition, we anticipate
that we will also source the active ingredient in TH104 from a sole supplier/manufacturer. Although we believe that we
can obtain the active ingredient for TH1940, TH3215, TH0059 and TH104 from other suppliers, supply shortages for these particular
raw material may delay our clinical trials. If we are unable to procure the active ingredient for our product candidates as needed,
our business may be harmed.
Our
failure to find third party collaborators to assist or share in the costs of drug development could materially harm our business, financial
condition and results of operations.
Our
strategy for the development and commercialization of our proprietary drug candidates may include the execution of collaborative arrangements
with third parties. Existing and future collaborators have significant discretion in determining the efforts and resources they apply
and may not perform their obligations as expected. Potential third-party collaborators include biopharmaceutical, pharmaceutical and
biotechnology companies, academic institutions and other entities. Third-party collaborators may assist us in:
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funding
research, pre-clinical development, clinical trials and manufacturing; |
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seeking
and obtaining regulatory approvals; and |
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successfully
commercializing any future drug candidates. |
If
we are not able to establish further collaboration agreements, we may be required to undertake drug development and commercialization
at our own expense. Such an undertaking may limit the number of drug candidates that we will be able to develop, significantly increase
our capital requirements and place additional strain on our internal resources. Our failure to enter into additional collaborations could
materially harm our business, financial condition and results of operations.
In
addition, our dependence on licensing, collaboration and other agreements with third parties may subject us to a number of risks. These
agreements may not be on terms that prove favorable to us and may require us to relinquish certain rights in our drug candidates. To
the extent we agree to work exclusively with one collaborator in a given area, our opportunities to collaborate with other entities could
be curtailed. Lengthy negotiations with potential new collaborators may lead to delays in the research, development or commercialization
of drug candidates. The decision by our collaborators to pursue alternative technologies or the failure of our collaborators to develop
or commercialize successfully any drug candidate to which they have obtained rights from us could materially harm our business, financial
condition and results of operations.
Risks
Related to Commercialization of Our Drug Candidates
Even
if we are successful in completing all pre-clinical studies and clinical trials, we may not be successful in commercializing one or more
of our drug candidates.
Even
if we complete the necessary pre-clinical studies and clinical trials, the marketing approval process is expensive, time-consuming and
uncertain and may prevent us from obtaining approvals for the commercialization of some or all of our drug candidates. If we are not
able to obtain, or if there are delays in obtaining, required regulatory approvals, we will not be able to commercialize our drug candidates,
and our ability to generate revenue will be materially impaired.
Our
drug candidates and the activities associated with their development and commercialization, including their design, testing, manufacture,
safety, efficacy, recordkeeping, labeling, storage, approval, advertising, promotion, sale and distribution, export and import are subject
to comprehensive regulation by the FDA and other regulatory agencies in the United States and by the EMA and similar regulatory authorities
outside of the United States. Failure to obtain marketing approval for a drug candidate will prevent us from commercializing the drug
candidate. We have not submitted an application for or received marketing approval for any of our drug candidates in the United States
or in any other jurisdiction.
We
have only limited experience in filing and supporting the applications necessary to gain marketing approvals and expect to rely on third-party
clinical research organizations or other third-party consultants or vendors to assist us in this process. Securing marketing approval
requires the submission of extensive pre-clinical and clinical data and supporting information to regulatory authorities for each therapeutic
indication to establish the drug candidate’s safety and efficacy. Securing marketing approval also requires the submission of information
about the drug manufacturing process to, and inspection of manufacturing facilities by, the regulatory authorities. Our drug candidates
may not be effective, may be only moderately effective or may prove to have undesirable or unintended side effects, toxicities or other
characteristics that may preclude our obtaining marketing approval or prevent or limit commercial use. New therapeutics frequently are
indicated only for patient populations that have not responded to an existing therapy or have relapsed. If any of our drug candidates
receives marketing approval, the accompanying label may limit the approved use of our drug in this way, which could limit sales of the
drug.
The
process of obtaining marketing approvals, both in the United States and abroad, is expensive, may take many years, if approval is obtained
at all, and can vary substantially based upon a variety of factors, including the type, complexity and novelty of the drug candidates
involved. Changes in marketing approval policies during the development period, changes in or the enactment of additional statutes or
regulations, or changes in regulatory review for each submitted drug application, may cause delays in the approval or rejection of an
application. Regulatory authorities have substantial discretion in the approval process and may refuse to accept any application or may
decide that our data is insufficient for approval and require additional pre-clinical, clinical or other studies. In addition, varying
interpretations of the data obtained from pre-clinical studies and clinical trials could delay, limit or prevent marketing approval of
a drug candidate. Any marketing approval we ultimately obtain may be limited or subject to restrictions or post-approval commitments
that render the approved drug not commercially viable.
If
we are unable to develop satisfactory sales and marketing capabilities, we may not succeed in commercializing our drug candidates.
We
have no experience in marketing and selling drug products. We have not entered into arrangements for the sale and marketing of any of
our drug candidates.
There
are risks involved with establishing our own sales and marketing capabilities. For example, recruiting and training a sales force is
expensive and time-consuming and could delay any product launch. If the commercial launch of a drug candidate for which we recruit a
sales force and establish marketing capabilities is delayed or does not occur for any reason, we would have prematurely or unnecessarily
incurred these commercialization expenses. These efforts are expected to be costly, and our investment would be lost if we cannot retain
or reposition our sales and marketing personnel.
We
may seek to collaborate with a third party to market our drugs or may seek to market and sell our drugs by ourselves. If we seek to collaborate
with a third party, we cannot be sure that a collaborative agreement can be reached on terms acceptable to us.
We
cannot be sure that we will be able to acquire, or establish third party relationships to provide, any or all of these marketing and
sales capabilities. The establishment of a direct sales force or a contract sales force or a combination direct and contract sales force
to market our drugs will be expensive and time-consuming and could delay any drug launch. Further, we can give no assurances that we
may be able to maintain a direct and/or contract sales force for any period of time or that our sales efforts will be sufficient to generate
or to grow our revenues or that our sales efforts will ever lead to profits.
The
development and commercialization of pharmaceutical products are subject to extensive regulation, and we may not obtain regulatory approvals
for our drug candidates on a timely basis, or at all.
The
time required to obtain approval or other marketing authorizations by the FDA is unpredictable, and it typically takes many years following
the commencement of clinical trials and depends upon numerous factors, including the substantial discretion of the regulatory authorities.
In addition, approval policies, regulations, and the type and amount of clinical data necessary to gain approval may change during the
course of a product candidate’s clinical development and may vary among jurisdictions. We have not obtained regulatory approval
for any product candidate, and it is possible that we may never obtain regulatory approval for any product candidates we may seek to
develop in the future. Neither we nor any current or future collaborator is permitted to market any drug product candidates in the United
States until we receive regulatory approval from the FDA.
Prior
to obtaining approval to commercialize any drug product candidate in the United States, we must demonstrate with substantial evidence
from well-controlled clinical trials, and to the satisfaction of the FDA, that such product candidates are safe, pure and effective for
their intended uses. Results from pre-clinical studies and clinical trials can be interpreted in different ways. Even if we believe the
pre-clinical or clinical data for our product candidates are promising, such data may not be sufficient to support approval by the FDA.
The FDA may also require us to conduct additional pre-clinical studies or clinical trials for our product candidates either prior to
or after approval, or it may object to elements of our clinical development programs.
Our
product candidates could fail to receive regulatory approval for many reasons, including the following:
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the
FDA may disagree with the design or implementation of our clinical trials; |
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we
may be unable to demonstrate to the satisfaction of the FDA that a product candidate is safe and effective for its proposed indication; |
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the
results of clinical trials may not meet the level of statistical significance required by the FDA for approval; |
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we
may be unable to demonstrate that a product candidate’s clinical and other benefits outweigh its safety risks; |
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the
FDA may fail to approve the manufacturing processes or facilities of third-party manufacturers with which we contract for clinical
and commercial supplies; and |
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the
approval policies or regulations of the FDA may significantly change in a manner rendering our clinical data insufficient for approval. |
Of
the large number of products in development, only a small percentage successfully complete the FDA approval processes and are commercialized.
The lengthy approval and marketing authorization process as well as the unpredictability of future clinical trial results may result
in our failing to obtain regulatory approval and marketing authorization to market our product candidates, which would significantly
harm our business, financial condition, results of operations and prospects.
We
have invested a significant portion of our time and financial resources in the development of our pre-clinical product candidates. Our
business is dependent on our ability to successfully complete pre-clinical and clinical development, obtain regulatory approval for,
and, if approved, successfully commercialize our product candidates in a timely manner.
Even
if we eventually complete clinical testing and receive approval for our product candidates, the FDA, may grant approval or other marketing
authorization contingent on the performance of costly additional clinical trials, including post-marketing clinical trials. The FDA,
also may approve or authorize for marketing a product candidate for a more limited indication or patient population than we originally
request, and the FDA may not approve or authorize the labeling that we believe is necessary or desirable for the successful commercialization
of a product candidate. Any delay in obtaining, or inability to obtain, applicable regulatory approval or other marketing authorization
would delay or prevent commercialization of that product candidate and would materially adversely impact our business and prospects.
In
addition, the FDA may change their policies, issue additional regulations or revise existing regulations, or take other actions, which
may prevent or delay approval of our future products under development on a timely basis. Such policy or regulatory changes could impose
additional requirements upon us that could delay our ability to obtain approvals, increase the costs of compliance or restrict our ability
to maintain any marketing authorizations we may have obtained.
Failure
to obtain marketing approval in foreign jurisdictions would prevent our drug candidates from being marketed abroad.
In
order to market and sell our drugs in the European Union and many other foreign jurisdictions, we or our potential third-party collaborators
must obtain separate marketing approvals and comply with numerous and varying regulatory requirements. The approval procedure varies
among countries and can involve additional testing. The time required to obtain approval may differ substantially from that required
to obtain FDA marketing approval. The regulatory approval process outside of the United States generally includes all of the risks associated
with obtaining FDA approval. In addition, in many countries outside of the United States, it is required that the drug be approved for
reimbursement before the drug can be approved for sale in that country. We or our potential third-party collaborators may not obtain
approvals from regulatory authorities outside of the United States on a timely basis, if at all. Approval by the FDA does not ensure
approval by regulatory authorities in other countries or jurisdictions, and approval by one regulatory authority outside of the United
States does not ensure approval by regulatory authorities in other countries or jurisdictions or by the FDA. However, a failure or delay
in obtaining regulatory approval in one country may have a negative effect on the regulatory process in other countries. We may not be
able to file for marketing approvals and may not receive necessary approvals to commercialize our drugs in any market.
Any
drug candidate that we obtain marketing approval for could be subject to post-marketing restrictions or withdrawal from the market and
we may be subject to substantial penalties if we fail to comply with regulatory requirements or if we experience unanticipated problems
with our drugs, when and if any of them are approved.
While
it is possible that one or more of our drug candidates may require a companion diagnostic to select the patients who will likely respond
to a therapy involving one of our drug candidates as a condition of approval, it is too early in our drug candidates development to identify
which drug candidate, if any, would require a companion diagnostic. According to FDA guidance, if the FDA determines that a companion
diagnostic device is essential to the safe and effective use of a novel therapeutic drug or indication, the FDA generally will not approve
the therapeutic drug or new therapeutic drug indication if the companion diagnostic is not also approved or cleared for that indication.
Under the Federal Food, Drug and Cosmetic Act (“FDCA”), companion diagnostics are regulated as medical devices, and the FDA
has generally required companion diagnostics intended to select the patients who will respond to treatment to obtain Premarket Approval
(“PMA”) for the diagnostic. The PMA process, including the gathering of clinical and pre-clinical data and the submission
to and review by the FDA, involves a rigorous premarket review during which the applicant must prepare and provide the FDA with reasonable
assurance of the device’s safety and effectiveness and information about the device and its components regarding, among other things,
device design, manufacturing and labeling. A PMA is not guaranteed and may take considerable time, and the FDA may ultimately respond
to a PMA submission with a “not approvable” determination based on deficiencies in the application and require additional
clinical trial or other data that may be expensive and time-consuming to generate and that can substantially delay approval. As a result,
if we are required by the FDA to obtain approval of a companion diagnostic for a therapeutic drug candidate, and we do not obtain or
there are delays in obtaining FDA approval of a diagnostic device, we may not be able to commercialize the drug candidate on a timely
basis or at all and our ability to generate revenue will be materially impaired.
Any
drug candidate for which we obtain marketing approval, along with the manufacturing processes, post-approval clinical data, labeling,
advertising and promotional activities for such drug, will be subject to continual requirements of and review by the FDA and other regulatory
authorities. These requirements include submissions of safety and other post-marketing information and reports, registration and listing
requirements, cGMP requirements relating to manufacturing, quality control, quality assurance and corresponding maintenance of records
and documents, requirements regarding the distribution of samples to physicians and recordkeeping. Even if marketing approval of a drug
candidate is granted, the approval may be subject to limitations on the indicated uses for which the drug may be marketed or to the conditions
of approval, including the requirement to implement a REMS. New drugs frequently are indicated only for patient populations that have
not responded to an existing therapy or have relapsed. If any of our drug candidates receives marketing approval, the accompanying label
may limit the approved use of our drug in this way, which could limit sales of the drug.
The
FDA may also impose requirements for costly post-marketing studies or clinical trials and surveillance to monitor the safety or efficacy
of the drug, including the adoption and implementation of REMS. The FDA and other agencies, including the Department of Justice (“DOJ”),
closely regulate and monitor the post-approval marketing and promotion of drugs to ensure they are marketed and distributed only for
the approved indications and in accordance with the provisions of the approved labeling. The FDA and DOJ impose stringent restrictions
on manufacturers’ communications regarding off-label use, and if we do not market our drugs for their approved indications, we
may be subject to enforcement action for off-label marketing. Violations of the FDCA and other statutes, including the False Claims Act,
relating to the promotion and advertising of prescription drugs may lead to investigations and enforcement actions alleging violations
of federal and state healthcare fraud and abuse laws, as well as state consumer protection laws. In addition, later discovery of previously
unknown adverse events or other problems with our drugs, manufacturers or manufacturing processes, or failure to comply with regulatory
requirements, may have various consequences, including:
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restrictions
on such drugs, manufacturers or manufacturing processes; |
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restrictions
and warnings on the labeling or marketing of a drug; |
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restrictions
on drug distribution or use; |
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requirements
to conduct post-marketing studies or clinical trials; |
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warning
letters or untitled letters; |
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withdrawal
of the drugs from the market; |
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refusal
to approve pending applications or supplements to approved applications that we submit; |
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recall
of drugs; |
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fines,
restitution or disgorgement of profits or revenues; |
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suspension
or withdrawal of marketing approvals; |
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damage
to relationships with any potential collaborators; |
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unfavorable
press coverage and damage to our reputation; |
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refusal
to permit the import or export of our drugs; |
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drug
seizure; |
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injunctions
or the imposition of civil or criminal penalties; or |
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litigation
involving patients using our drugs. |
Healthcare
reform initiatives in the United States may impact our business and results of operations.
In
the United States, there have been, and continue to be, a number of legislative and regulatory changes and proposed changes to the healthcare
system that could affect the future results of pharmaceutical manufactures’ operations. In particular, there have been and continue
to be a number of initiatives at the federal and state levels that seek to reduce healthcare and prescription drug costs. On the
federal level, the Affordable Care Act (“ACA”) was enacted in March 2010, and
included measures to significantly change the way healthcare is financed by both governmental and private insurers. Among the provisions
of the ACA that have been of greatest importance to the pharmaceutical and biotechnology industry are the following:
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an
annual, nondeductible fee on any entity that manufactures or imports certain branded prescription drugs and biologic agents, apportioned
among these entities according to their market share in certain government healthcare programs; |
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implementation
of the federal physician payment transparency requirements, sometimes referred to as the “Physician Payments Sunshine Act”; |
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a
licensure framework for follow-on biologic products; |
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creation
of Patient-Centered Outcomes Research Institute to oversee, identify priorities in, and conduct comparative clinical effectiveness
research, along with funding for such research; |
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establishment
of a Center for Medicare Innovation at the Centers for Medicare & Medicaid Services to test innovative payment and service delivery
models to lower Medicare and Medicaid spending, potentially including prescription drug spending; |
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an
increase in the statutory minimum rebates a manufacturer must pay under the Medicaid Drug Rebate Program, to 23.1% and 13% of the
average manufacturer price for most branded and generic drugs, respectively, and capped the total rebate amount for innovator drugs
at 100% of the Average Manufacturer Price; |
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adoption
of methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for certain drugs and
biologics, including our product candidates, that are inhaled, infused, instilled, implanted or injected; |
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extension
of manufacturers’ Medicaid rebate liability to covered drugs dispensed to individuals who are enrolled in Medicaid managed
care organizations; |
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expansion
of eligibility criteria for Medicaid programs by, among other things, allowing states to offer Medicaid coverage to additional individuals
and by adding new mandatory eligibility categories for individuals with income at or below 133% of the federal poverty level, thereby
potentially increasing manufacturers’ Medicaid rebate liability; |
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creation
of a Medicare Part D coverage gap discount program, in which manufacturers must agree to offer 50% point-of-sale discounts off negotiated
prices of applicable brand drugs to eligible beneficiaries during their coverage gap period, as a condition for the manufacturer’s
outpatient drugs to be covered under Medicare Part D; and |
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expansion
of the entities eligible for discounts under the Public Health program. |
Although
there have been legal and political challenges to certain aspects of the ACA, the Biden Administration has affirmed support for the law,
entered its own executive orders to enforce and strengthen it, and committed to examining and, where appropriate, reversing contrary
Trump Administration policies. The Tax Cuts and Jobs Act of 2017 includes a provision repealing, effective January 1, 2019, the tax-based
shared responsibility payment imposed by the ACA on certain individuals who fail to maintain qualifying health coverage for all or part
of a year that is commonly referred to as the “individual mandate.”
Because
of the volatility surrounding the implementation and enforcement of the ACA since its passage, the full effect that the ACA would have
on a pharmaceutical manufacturer remains unclear. This uncertainty is heightened by President Biden’s January 28, 2021 Executive
Order on Strengthening Medicaid and the ACA which indicates that the Biden Administration may significantly modify the ACA and further
reform the ACA and other federal programs in manner that may impact our operations. The Biden Administration has indicated that a goal
of its administration is to expand and support Medicaid and the ACA and to make high-quality healthcare accessible and affordable. The
potential increase in patients covered by government funded insurance may impact our pricing. Further, it is possible that the Biden
Administration may further increase scrutiny of drug pricing.
Additionally,
in December 2019, a federal appeals court held that the individual mandate portion of the ACA was unconstitutional and left open the
question whether the remaining provisions of the ACA would be valid without the individual mandate. However, on appeal, the Supreme Court
ruled, in June 2021, that the parties challenging the law lacked standing, leaving the ACA in place. It is unclear how any other potential
litigation challenging the ACA and the healthcare reform measures of the Biden administration will impact the ACA. We cannot predict
the likelihood, nature or extent of government regulation that may arise from future legislation or administrative or executive action,
either in the United States or abroad. We expect that additional state and federal health care reform measures will be adopted in the
future, any of which could limit the amounts that federal and state governments will pay for health care products and services.
Moreover,
prescription drug pricing and transparency has been a recent focus of federal policymaking. The Inflation Reduction Act, signed
into law in August 2022, contained multiple provisions aimed at lowering the cost of prescription drugs. The law allows Medicare
to negotiate the price of certain high-cost drugs with pharmaceutical manufacturers and puts a limit on out-of-pocked costs
for Medicare Part D members. Pharmaceutical manufacturers will also have to pay rebates to Medicare if the prices of their drugs
under Medicare increase fast than the rate of inflation. The Biden Administration also issued an executive order in October 2022
aimed at evaluating new health care payment and delivery models that would lower costs for prescription drugs and promote
access to emerging therapies.
Further,
there is uncertainty surrounding the applicability of the biosimilars provisions under the ACA. The FDA has issued several guidance documents,
but no implementing regulations, on biosimilars. A number of biosimilar applications have been approved over the past few years. The
regulations that are ultimately promulgated and their implementation are likely to have considerable impact on the way pharmaceutical
manufacturers conduct their business and may require changes to current strategies. A biosimilar is a biological product that is highly
similar to an approved drug notwithstanding minor differences in clinically inactive components, and for which there are no clinically
meaningful differences between the biological product and the approved drug in terms of the safety, purity, and potency of the product.
Individual
states have become increasingly aggressive in passing legislation and implementing regulations designed to control pharmaceutical and
biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access,
and marketing cost disclosure and transparency measures, and to encourage importation from other countries and bulk purchasing. Legally
mandated price controls on payment amounts by third-party payors or other restrictions could harm a pharmaceutical manufacturer’s
business, results of operations, financial condition and prospects. In addition, regional healthcare authorities and individual hospitals
are increasingly using bidding procedures to determine what pharmaceutical products and which suppliers will be included in their prescription
drug and other healthcare programs. This could reduce ultimate demand for certain products or put pressure product pricing, which could
negatively affect a pharmaceutical manufacturer’s business, results of operations, financial condition and prospects.
In
addition, given recent federal and state government initiatives directed at lowering the total cost of healthcare, Congress and state
legislatures will likely continue to focus on healthcare reform, the cost of prescription drugs and biologics and the reform of the Medicare
and Medicaid programs. While no one cannot predict the full outcome of any such legislation, it may result in decreased reimbursement
for drugs and biologics, which may further exacerbate industry-wide pressure to reduce prescription drug prices. This could harm a pharmaceutical
manufacturer’s ability to generate revenue. Increases in importation or re-importation of pharmaceutical products from foreign
countries into the United States could put competitive pressure on a pharmaceutical manufacturer’s ability to profitably price
products, which, in turn, could adversely affect business, results of operations, financial condition and prospects. A pharmaceutical
manufacturer might elect not to seek approval for or market products in foreign jurisdictions in order to minimize the risk of re-importation,
which could also reduce the revenue generated from product sales. It is also possible that other legislative proposals having similar
effects will be adopted.
Furthermore,
regulatory authorities’ assessment of the data and results required to demonstrate safety and efficacy can change over time and
can be affected by many factors, such as the emergence of new information, including on other products, changing policies and agency
funding, staffing and leadership. We cannot be sure whether future changes to the regulatory environment will be favorable or unfavorable
to our business prospects. For example, average review times at the FDA for marketing approval applications can be affected by a variety
of factors, including budget and funding levels and statutory, regulatory and policy changes.
If
we fail to comply with environmental, health and safety laws and regulations, we could become subject to fines or penalties or incur
costs that could harm our business.
We
are subject to numerous foreign, federal, state and local environmental, health and safety laws and regulations, including those governing
laboratory procedures and the handling, use, storage, treatment and disposal of hazardous materials and wastes. Our operations involve
the use of hazardous and flammable materials, including chemicals and biological materials. Our operations also produce hazardous waste
products. We generally contract with third parties for the disposal of these materials and wastes. We cannot eliminate the risk of contamination
or injury from these materials. In the event of contamination or injury resulting from our use of hazardous materials, we could be held
liable for any resulting damages, and any liability could exceed our resources, including any available insurance.
In
addition, our leasing and operation of real property may subject us to liability pursuant to certain of these laws or regulations. Under
existing U.S. environmental laws and regulations, current or previous owners or operators of real property and entities that disposed
or arranged for the disposal of hazardous substances may be held strictly, jointly and severally liable for the cost of investigating
or remediating contamination caused by hazardous substance releases, even if they did not know of and were not responsible for the releases.
We
could incur significant costs and liabilities which may adversely affect our financial condition and operating results for failure to
comply with such laws and regulations, including, among other things, civil or criminal fines and penalties, property damage and personal
injury claims, costs associated with upgrades to our facilities or changes to our operating procedures, or injunctions limiting or altering
our operations.
Although
we maintain workers’ compensation insurance to cover us for costs and expenses we may incur due to injuries to our employees resulting
from the use of hazardous materials, this insurance may not provide adequate coverage against potential liabilities. We do not maintain
insurance for environmental liability or toxic tort claims that may be asserted against us in connection with our storage or disposal
of biological, hazardous or radioactive materials.
In
addition, we may incur substantial costs in order to comply with current or future environmental, health and safety laws and regulations.
These current or future laws and regulations, which are becoming increasingly more stringent, may impair our research, development or
production efforts. Our failure to comply with these laws and regulations also may result in substantial fines, penalties or other sanctions.
Risks
Related to Our Intellectual Property
If
we do not obtain patent term extension for any drug candidates we may develop, our business may be materially harmed.
In
the United States, depending upon the timing, duration, and specifics of any FDA marketing approval of a drug candidate, the patent term
of a patent that covers an FDA-approved drug may be eligible for limited patent term extension, which permits patent term restoration
as compensation for the patent term lost during the FDA regulatory review process. The Drug Price Competition and Patent Term Restoration
Act of 1984, also known as the Hatch-Waxman Act, permits a patent term extension of up to five years beyond the expiration of the patent.
The length of the patent term extension is related to the length of time the drug is under regulatory review. Patent term extension cannot
extend the remaining term of a patent beyond a total of 14 years from the date of drug approval, and only one patent applicable to an
approved drug may be extended and only those claims covering the approved drug, a method for using it, or a method for manufacturing
it may be extended. Similar provisions are available in Europe and other non-United States jurisdictions to extend the term of a patent
that covers an approved drug. While, in the future, if and when our drug candidates receive FDA approval, we expect to apply for patent
term extensions on patents covering those drug candidates, there is no guarantee that the applicable authorities will agree with our
assessment of whether such extensions should be granted, and even if granted, the length of such extensions. We may not be granted an
extension because of, for example, failing to exercise due diligence during the testing phase or regulatory review process, failing to
apply within applicable deadlines, failing to apply prior to expiration of the relevant patents, or otherwise failing to satisfy applicable
requirements. If we are unable to obtain any patent term extension or the term of any such extension is less than we request, our competitors
may obtain approval of competing drugs following the expiration of our patent rights, and our business, financial condition, results
of operations, and prospects could be materially harmed.
Changes
to patent laws in the United States and other jurisdictions could diminish the value of patents in general, thereby impairing our ability
to protect our drugs.
As
is the case with other pharmaceutical companies, our success is heavily dependent on intellectual property, particularly patents. Obtaining
and enforcing patents in the pharmaceutical industry involves both technological and legal complexity and is therefore costly, time consuming
and inherently uncertain. Changes in either the patent laws or interpretation of the patent laws in the United States could increase
the uncertainties and costs surrounding the prosecution of patent applications and the enforcement or defense of issued patents. Recent
patent reform legislation in the United States and other countries, including the Leahy-Smith America Invents Act (the Leahy-Smith Act)
signed into law in September 2011, could increase those uncertainties and costs. The Leahy-Smith Act includes a number of significant
changes to U.S. patent law. These include provisions that affect the way patent applications are prosecuted, redefine prior art and provide
more efficient and cost-effective avenues for competitors to challenge the validity of patents. For example, the Leahy-Smith Act allows
third-party submission of prior art to the U.S. Patent and Trademark Office (“USPTO”)
during patent prosecution and additional procedures to attack the validity of a patent by USPTO administered post-grant proceedings,
including post-grant review, inter parties review, and derivation proceedings. In addition, the Leahy-Smith Act has transformed the U.S.
patent system from a “first-to-invent” system to a “first-to-file” system in which, assuming that other requirements
for patentability are met, the first inventor to file a patent application will be entitled to the patent on an invention regardless
of whether a third party was the first to invent the claimed invention.
In
addition, the patent positions of companies in the development and commercialization of biologics and pharmaceuticals are particularly
uncertain. Recent U.S. Supreme Court and Federal Circuit rulings have narrowed the scope of patent protection available in certain circumstances
and weakened the rights of patent owners in certain situations. This combination of events has created uncertainty with respect to the
validity and enforceability of patents once obtained. Depending on future actions by the U.S. Congress, the federal courts, and the USPTO,
the laws and regulations governing patents could change in unpredictable ways that could have a material adverse effect on our patent
rights and our ability to protect, defend and enforce our patent rights in the future.
We
or our future licensors may become involved in lawsuits to protect or enforce our patent or other intellectual property rights, which
could be expensive, time-consuming and unsuccessful.
Competitors
and other third parties may infringe, misappropriate or otherwise violate our or our future licensors’ issued patents or other
intellectual property. As a result, we or our licensors may need to file infringement, misappropriation or other intellectual property
related claims, which can be expensive and time-consuming. Any claims we assert against perceived infringers could provoke such parties
to assert counterclaims against us alleging that we infringe, misappropriate or otherwise violate their intellectual property. In addition,
in a patent infringement proceeding, such parties could counterclaim that the patents we or our licensors have asserted are invalid or
unenforceable. In patent litigation in the United States, defendant counterclaims alleging invalidity or unenforceability are commonplace.
Grounds for a validity challenge could be an alleged failure to meet any of several statutory requirements, including lack of novelty,
obviousness, or non-enablement. Grounds for an unenforceability assertion could be an allegation that someone connected with prosecution
of the patent withheld relevant information from the USPTO, or made a misleading statement, during prosecution. Third parties may institute
such claims before administrative bodies in the United States or abroad, even outside the context of litigation. Such mechanisms include
re-examination, post-grant review, inter parties review, interference proceedings, derivation proceedings, and equivalent proceedings
in foreign jurisdictions (e.g., opposition proceedings).
An
adverse result in any such proceeding could put one or more of our owned or in-licensed patents at risk of being invalidated or interpreted
narrowly, and could put any of our owned or in-licensed patent applications at risk of not yielding an issued patent. A court may also
refuse to stop the third party from using the technology at issue in a proceeding on the grounds that our owned or in-licensed patents
do not cover such technology. Furthermore, because of the substantial amount of discovery required in connection with intellectual property
litigation, there is a risk that some of our confidential information or trade secrets could be compromised by disclosure during this
type of litigation. Any of the foregoing could allow such third parties to develop and commercialize competing technologies and products
and have a material adverse impact on our business, financial condition, results of operations, and prospects.
Third
parties may initiate legal proceedings alleging that we are infringing, misappropriating or otherwise violating their intellectual property
rights, the outcome of which would be uncertain and could have a material adverse effect on the success of our business.
Our
commercial success depends upon our ability, and the ability of our collaborators, to develop, manufacture, market and sell our drug
candidates and use our proprietary technologies without infringing, misappropriating or otherwise violating the intellectual property
and proprietary rights of third parties. There is considerable patent and other intellectual property litigation in the pharmaceutical
and biotechnology industries. We may become party to, or threatened with, adversarial proceedings or litigation regarding intellectual
property rights with respect to our technology and drug candidates, including interference proceedings, post grant review, inter parties
review, and derivation proceedings before the USPTO and similar proceedings in foreign jurisdictions such as oppositions before the European
Patent Office.
The
legal threshold for initiating litigation or contested proceedings is low, so that even lawsuits or proceedings with a low probability
of success might be initiated and require significant resources to defend. Litigation and contested proceedings can also be expensive
and time-consuming, and our adversaries in these proceedings may have the ability to dedicate substantially greater resources to prosecuting
these legal actions than we can. The risks of being involved in such litigation and proceedings may increase if and as our drug candidates
near commercialization and as we gain the greater visibility associated with being a public company. Third parties may assert infringement
claims against us based on existing patents or patents that may be granted in the future, regardless of merit. We may not be aware of
all such intellectual property rights potentially relating to our technology and drug candidates and their uses. Thus, we do not know
with certainty that our technology and drug candidates, or our development and commercialization thereof, do not and will not infringe,
misappropriate or otherwise violate any third party’s intellectual property.
Even
if we believe that third party intellectual property claims are without merit, there is no assurance that a court would find in our favor
on questions of misappropriation, infringement, validity, enforceability, or priority. A court of competent jurisdiction could hold these
third-party patents are valid, enforceable, and infringed, which could materially and adversely affect our ability to commercialize any
technology or drug candidate covered by the asserted third-party patents. In order to successfully challenge the validity of any such
U.S. patent in federal court, we would need to overcome a presumption of validity. As this burden is a high one requiring us to present
clear and convincing evidence as to the invalidity of any such U.S. patent claim, there is no assurance that a court of competent jurisdiction
would invalidate the claims of any such U.S. patent.
If
we are found to infringe, misappropriate or otherwise violate a third party’s intellectual property rights, we could be required
to obtain a license from such third party to continue developing, manufacturing and marketing our drug candidates. However,
we may not be able to obtain any required license on commercially reasonable terms or at all. Even if we were able to obtain a license,
it could be non-exclusive; thereby giving our competitors and other third parties access to the same technologies licensed to us and
could require us to make substantial licensing and royalty payments. We could be forced, including by court order, to cease developing,
manufacturing and commercializing the infringing technology or drug. In addition, we could be found liable for significant monetary damages,
including treble damages and attorneys’ fees, if we are found to have willfully infringed a patent or other intellectual property
right and could be forced to indemnify our collaborators or others. A finding of infringement could prevent us from commercializing our
drug candidates or force us to cease some of our business operations, which could materially harm our business. In addition, we may be
forced to redesign our drug candidates, seek new regulatory approvals and indemnify third parties pursuant to contractual agreements.
Claims that we have misappropriated the confidential information or trade secrets of third parties could have a similar material adverse
effect on our business, financial condition, results of operations, and prospects.
Intellectual
property litigation or other legal proceedings relating to intellectual property could cause us to spend substantial resources and distract
our personnel from their normal responsibilities.
Even
if resolved in our favor, litigation or other legal proceedings relating to intellectual property claims may cause us to incur significant
expenses and could distract our technical and management personnel from their normal responsibilities. In addition, there could be public
announcements of the results of hearings, motions or other interim proceedings or developments and if securities analysts or investors
perceive these results to be negative, it could have a substantial adverse effect on the price of our common stock. Such litigation or
proceedings could substantially increase our operating losses and reduce the resources available for development activities or any future
sales, marketing or distribution activities. We may not have sufficient financial or other resources to conduct such litigation or proceedings
adequately. Some of our competitors may be able to sustain the costs of such litigation or proceedings more effectively than we can because
of their greater financial resources and may also have an advantage in such proceedings due to their more mature and developed intellectual
property portfolios. Uncertainties resulting from the initiation and continuation of intellectual property litigation or other proceedings
could compromise our ability to compete in the marketplace.
If
we fail to comply with our obligations in our future intellectual property licenses and funding arrangements with third parties, we could
lose rights that are important to our business.
We
may be party to license and funding agreements that impose diligence, development and commercialization timelines, milestone payment,
royalty, insurance and other obligations on us. If we fail to comply with such obligations, our counterparties may have the right to
terminate our agreements or require us to grant them certain rights. Such an occurrence could materially adversely affect the value of
any drug candidate being developed under any such agreement. Termination of these agreements or reduction or elimination of our rights
under these agreements may result in our having to negotiate new or reinstated agreements with less favorable terms, or cause us to lose
our rights under these agreements, including our rights to important intellectual property or technology, which would have a material
adverse effect on our business, financial condition, results of operations, and prospects.
Additionally,
these and other license agreements may not provide exclusive rights to use the licensed intellectual property and technology in all relevant
fields of use and in all territories in which we may wish to develop or commercialize our technology and drugs in the future. As a result,
we may not be able to prevent competitors from developing and commercializing competitive products and technology in fields of use and
territories not included in such agreements. In addition, we may not have the right to control the preparation, filing, prosecution,
maintenance, enforcement, and defense of patents and patent applications covering the technology that we may license from third parties.
Therefore, we cannot be certain that these patents and patent applications will be prepared, filed, prosecuted, maintained, and defended
in a manner consistent with the best interests of our business. If our licensors fail to prosecute, maintain, enforce, and defend such
patents, or lose rights to those patents or patent applications, the rights we have licensed may be reduced or eliminated, and our right
to develop and commercialize any of our drugs that are the subject of such licensed rights could be adversely affected.
We
may need to obtain additional licenses from others to advance our research or allow commercialization of our drug candidates. It is possible
that we may be unable to obtain additional licenses at a reasonable cost or on reasonable terms, if at all, or such licenses may be non-exclusive.
The licensing or acquisition of third-party intellectual property rights is a competitive area, and several more established companies
may pursue strategies to license or acquire third-party intellectual property rights that we may consider attractive or necessary. These
established companies may have a competitive advantage over us due to their size, capital resources and greater clinical development
and commercialization capabilities. In addition, companies that perceive us to be a competitor may be unwilling to assign or license
rights to us. We also may be unable to license or acquire third-party intellectual property rights on terms that would allow us to make
an appropriate return on our investment or at all.
If
we are unable to obtain rights to required third-party intellectual property rights or maintain the existing intellectual property rights
we have, we may be required to expend significant time and resources to redesign our technology, drug candidates, or the methods for
manufacturing them or to develop or license replacement technology, all of which may not be feasible on a technical or commercial basis.
If we are unable to do so, we may be unable to develop or commercialize the affected technology and drug candidates, which could harm
our business, financial condition, results of operations, and prospects significantly.
Disputes
may arise regarding intellectual property subject to a licensing agreement, including:
● |
the
scope of rights granted under the license agreement and other interpretation related issues; |
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● |
the
extent to which our technology and processes infringe on intellectual property of the licensor that is not subject to the licensing
agreement; |
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the
sublicensing of patent and other rights under our collaborative development relationships; |
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● |
our
diligence obligations under the license agreement and what activities satisfy those diligence obligations; |
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the
inventorship and ownership of inventions and know-how resulting from the joint creation or use of intellectual property by our licensors
and us and our partners; and |
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the
priority of invention of patented technology. |
In
addition, any agreements under which we license intellectual property or technology from third parties may be complex, and certain provisions
in such agreements may be susceptible to multiple interpretations. The resolution of any contract interpretation disagreement that may
arise could narrow what we believe to be the scope of our rights to the relevant intellectual property or technology or increase what
we believe to be our financial or other obligations under the relevant agreement, either of which could have a material adverse effect
on our business, financial condition, results of operations, and prospects. Moreover, if disputes over intellectual property that we
have licensed prevent or impair our ability to maintain our current licensing arrangements on commercially acceptable terms, we may be
unable to successfully develop and commercialize the affected technology and drug candidates, which could have a material adverse effect
on our business, financial conditions, results of operations, and prospects.
Our
future licensors may rely on third-party consultants or collaborators or on funds from third parties such that our licensors are not
the sole and exclusive owners of the patents and patent applications we in-licensed. If other third parties have ownership rights to
our in-licensed patents, they may be able to license such patents to our competitors, and our competitors could market competing products
and technology. This could have a material adverse effect on our competitive position, business, financial conditions, results of operations,
and prospects.
In
spite of our best efforts, our future licensors might conclude that we have materially breached our license agreements and might therefore
terminate our license agreements, thereby removing our ability to develop and commercialize drug candidates and technology covered by
such agreements. If these in-licenses are terminated, or if the underlying intellectual property fails to provide the intended exclusivity,
competitors would have the freedom to seek regulatory approval of, and to market, products and technologies identical to ours. This could
have a material adverse effect on our competitive position, business, financial conditions, results of operations, and prospects.
We
may not be able to protect our intellectual property and proprietary rights throughout the world.
Filing,
prosecuting, and defending patents on drug candidates in all countries throughout the world would be prohibitively expensive, and the
laws of foreign countries may not protect our rights to the same extent as the laws of the United States. Consequently, we may not be
able to prevent third parties from practicing our inventions in all countries outside the United States, or from selling or importing
products made using our inventions in and into the United States or other jurisdictions. Competitors may use our technologies in jurisdictions
where we have not obtained patent protection to develop their own products and, further, may export otherwise infringing products to
territories where we have patent protection or licenses but enforcement is not as strong as that in the United States. These products
may compete with our products, and our patents or other intellectual property rights may not be effective or sufficient to prevent them
from competing.
Many
companies have encountered significant problems in protecting and defending intellectual property rights in foreign jurisdictions. The
legal systems of certain countries, particularly certain developing countries, do not favor the enforcement of patents, trade secrets,
and other intellectual property protection, particularly those relating to pharmaceutical products, which could make it difficult for
us to stop the infringement of our patents or marketing of competing products in violation of our intellectual property and proprietary
rights generally. Proceedings to enforce our intellectual property and proprietary rights in foreign jurisdictions could result in substantial
costs and divert our efforts and attention from other aspects of our business, could put our patents at risk of being invalidated or
interpreted narrowly, could put our patent applications at risk of not issuing, and could provoke third parties to assert claims against
us. We may not prevail in any lawsuits that we initiate, and the damages or other remedies awarded, if any, may not be commercially meaningful.
Accordingly, our efforts to enforce our intellectual property and proprietary rights around the world may be inadequate to obtain a significant
commercial advantage from the intellectual property that we develop or license.
Many
countries have compulsory licensing laws under which a patent owner may be compelled to grant licenses to third parties. In addition,
many countries limit the enforceability of patents against government agencies or government contractors. In these countries, the patent
owner may have limited remedies, which could materially diminish the value of such patent. If we or any of our licensors is forced to
grant a license to third parties with respect to any patents relevant to our business, our competitive position may be impaired, and
our business, financial condition, results of operations, and prospects may be adversely affected.
Risks
Related to Managing Our Business and Operations
We
may encounter difficulties in managing our growth, which could adversely affect our operations.
As
of September 30, 2023, we had 2 full-time employee and 1 part-time employee. As our clinical development and commercialization
plans and strategies develop, we will need to expand our managerial, clinical, regulatory, sales, marketing, financial, development,
manufacturing and legal capabilities or contract with third parties to provide these capabilities for us. As our operations expand, we
expect that we will need to manage additional relationships with various strategic collaborators, suppliers and other third parties.
Our future growth would impose significant added responsibilities on members of management, including:
● |
identifying,
recruiting, integrating, maintaining and motivating additional employees; |
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● |
managing our development
and commercialization efforts effectively, including the clinical and FDA review process for our product candidates, while complying
with our contractual obligations to contractors and other third parties; and |
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● |
improving our operational,
financial and management controls, reporting systems and procedures. |
Our
ability to continue to develop and, if approved, commercialize our product candidates will depend, in part, on our ability to effectively
manage any future growth. Our management may also have to divert a disproportionate amount of its attention away from day-to-day activities
in order to devote a substantial amount of time to managing these growth activities.
We
currently rely, and for the foreseeable future will continue to rely, in substantial part on certain independent organizations, advisors
and consultants to provide certain services, including contract manufacturers and companies focused on research and development and discovery
activities. There can be no assurance that the services of independent organizations, advisors and consultants will continue to be available
to us on a timely basis when needed, or that we can find qualified replacements. In addition, if we are unable to effectively manage
our outsourced activities or if the quality, accuracy or quantity of the services provided is compromised for any reason, our clinical
trials may be extended, delayed or terminated, and we may not be able to obtain, or may be substantially delayed in obtaining, regulatory
approval of our product candidates or otherwise advance our business. There can be no assurance that we will be able to manage our existing
consultants or find other competent outside contractors and consultants on economically reasonable terms, or at all.
If
we are not able to effectively expand our organization by hiring new employees and expanding our groups of consultants and contractors,
we may not be able to successfully implement the tasks necessary to further develop and commercialize our product candidates and, accordingly,
may not achieve our research, development and commercialization goals.
We
may acquire additional technology and complementary businesses in the future. Acquisitions involve many risks, any of which could materially
harm our business, including the diversion of management’s attention from core business concerns, failure to effectively exploit
acquired technologies, failure to successfully integrate the acquired business or realize expected synergies or the loss of key employees
from either our business or the acquired businesses.
Our
internal computer systems, or those of our collaborators or other contractors or consultants, may fail or suffer security breaches, which
could result in a material disruption of our product development programs.
Our
internal computer systems and those of our current and any future collaborators and other contractors or consultants are vulnerable to
damage from computer viruses, unauthorized access, natural disasters, terrorism, war and telecommunication and electrical failures. While
we have not experienced any such material system failure, accident or security breach to date, if such an event were to occur and cause
interruptions in our operations, it could result in a disruption of our development programs and our business operations, whether due
to a loss of our trade secrets or other proprietary information or other similar disruptions. For example, the loss of clinical trial
data from future clinical trials could result in delays in our regulatory approval efforts and significantly increase our costs to recover
or reproduce the data. To the extent that any disruption or security breach were to result in a loss of, or damage to, our data or applications,
or inappropriate disclosure of confidential or proprietary information, we could incur liability, our competitive position could be harmed
and the further development and commercialization of our product candidates could be delayed.
We
could be subject to risks caused by misappropriation, misuse, leakage, falsification or intentional or accidental release or loss of
information maintained in the information systems and networks of our company and our vendors, including personal information of our
employees and study subjects, and company and vendor confidential data. In addition, outside parties may attempt to penetrate our systems
or those of our vendors or fraudulently induce our personnel or the personnel of our vendors to disclose sensitive information in order
to gain access to our data and/or systems. We may experience threats to our data and systems, including malicious codes and viruses,
phishing and other cyberattack. The number and complexity of these threats continue to increase over time. If a material breach of, or
accidental or intentional loss of data from, our information technology systems or those of our vendors occurs, the market perception
of the effectiveness of our security measures could be harmed and our reputation and credibility could be damaged. We could be required
to expend significant amounts of money and other resources to repair or replace information systems or networks. In addition, we could
be subject to regulatory actions and/or claims made by individuals and groups in private litigation involving privacy issues related
to data collection and use practices and other data privacy laws and regulations, including claims for misuse or inappropriate disclosure
of data, as well as unfair or deceptive practices. Although we develop and maintain systems and controls designed to prevent these events
from occurring, and we have a process to identify and mitigate threats, the development and maintenance of these systems, controls and
processes is costly and requires ongoing monitoring and updating as technologies change and efforts to overcome security measures become
increasingly sophisticated. Moreover, despite our efforts, the possibility of these events occurring cannot be eliminated entirely. As
we outsource more of our information systems to vendors, engage in more electronic transactions with payors and patients, and rely more
on cloud-based information systems, the related security risks will increase and we will need to expend additional resources to protect
our technology and information systems. In addition, there can be no assurance that our internal information technology systems or those
of our third-party contractors, or our consultants’ efforts to implement adequate security and control measures, will be sufficient
to protect us against breakdowns, service disruption, data deterioration or loss in the event of a system malfunction, or prevent data
from being stolen or corrupted in the event of a cyberattack, security breach, industrial espionage attacks or insider threat attacks
which could result in financial, legal, business or reputational harm.
Our
current operations are concentrated in one location, and we or the third parties upon whom we depend may be adversely affected by earthquakes
or other natural disasters and our business continuity and disaster recovery plans may not adequately protect us from a serious disaster,
including earthquakes, outbreak of disease or other natural disasters.
Any
unplanned event, such as flood, fire, explosion, earthquake, extreme weather condition, medical epidemics, power shortage, telecommunication
failure or other natural or manmade accidents or incidents that result in us being unable to fully utilize our facilities, or the manufacturing
facilities of our third-party contract manufacturers, may have a material and adverse effect on our ability to operate our business,
particularly on a daily basis, and have significant negative consequences on our financial and operating conditions. Loss of access to
these facilities may result in increased costs, delays in the development of our product candidates or interruption of our business operations.
Earthquakes or other natural disasters could further disrupt our operations, and have a material and adverse effect on our business,
financial condition, results of operations and prospects. If a natural disaster, power outage or other event occurred that prevented
us from using all or a significant portion of our headquarters, that damaged critical infrastructure, such as our research facilities
or the manufacturing facilities of our third-party contract manufacturers, or that otherwise disrupted operations, it may be difficult
or, in certain cases, impossible, for us to continue our business for a substantial period of time.
The
disaster recovery and business continuity plans we have in place may prove inadequate in the event of a serious disaster or similar event.
We may incur substantial expenses as a result of the limited nature of our disaster recovery and business continuity plans, which, could
have a material adverse effect on our business. As part of our risk management policy, we maintain insurance coverage at levels that
we believe are appropriate for our business. However, in the event of an accident or incident at these facilities, we cannot assure you
that the amounts of insurance will be sufficient to satisfy any damages and losses. If our facilities, or the manufacturing facilities
of our third-party contract manufacturers, are unable to operate because of an accident or incident or for any other reason, even for
a short period of time, any or all of our research and development programs may be harmed.
Unfavorable
global economic conditions could adversely affect our business, financial condition or results of operations.
Our
results of operations could be adversely affected by general conditions in the global economy and in the global financial markets. Portions
of our future clinical trials may be conducted outside of the United States and unfavorable economic conditions resulting in the weakening
of the U.S. dollar would make those clinical trials more costly to operate. Furthermore, the most recent global financial crisis caused
extreme volatility and disruptions in the capital and credit markets. A severe or prolonged economic downturn could result in a variety
of risks to our business, including a reduced ability to raise additional capital when needed on acceptable terms, if at all. A weak
or declining economy or international trade disputes could also strain our suppliers, some of which are located outside of the United
States, possibly resulting in supply disruption. Any of the foregoing could harm our business and we cannot anticipate all of the ways
in which the current economic climate and financial market conditions could adversely impact our business.
The
increasing use of social media platforms presents new risks and challenges.
Social
media is increasingly being used to communicate about our clinical development programs and the diseases our therapeutics are being developed
to treat, and we intend to utilize appropriate social media in connection with our commercialization efforts following approval of our
product candidates, if any. Social media practices in the biopharmaceutical industry continue to evolve and regulations and regulatory
guidance relating to such use are evolving and not always clear. This evolution creates uncertainty and risk of noncompliance with regulations
applicable to our business, resulting in potential regulatory actions against us, along with the potential for litigation related to
off-label marketing or other prohibited activities. For example, patients may use social media channels to comment on their experience
in an ongoing blinded clinical trial or to report an alleged adverse event. When such disclosures occur, there is a risk that trial enrollment
may be adversely impacted, we fail to monitor and comply with applicable adverse event reporting obligations or that we may not be able
to defend our business or the public’s legitimate interests in the face of the political and market pressures generated by social
media due to restrictions on what we may say about our product candidates. There is also a risk of inappropriate disclosure of sensitive
information or negative or inaccurate posts or comments about us on any social networking website. If any of these events were to occur
or we otherwise fail to comply with applicable regulations, we could incur liability, face regulatory actions or incur other harm to
our business.
The
estimates of market opportunity and forecasts of market growth included in this prospectus may prove to be inaccurate, and even if the
markets in which we compete achieve the forecasted growth, our business may not grow at similar rates, or at all.
Market
opportunity estimates and growth forecasts included in this prospectus are subject to significant uncertainty and are based on assumptions
and estimates which may not prove to be accurate. The estimates and forecasts included in this prospectus relating to size and expected
growth of our target market may prove to be inaccurate. Even if the markets in which we compete meet the size estimates and growth forecasts
included in this prospectus, our business may not grow at similar rates, or at all. Our growth is subject to many factors, including
our success in implementing our business strategy, which is subject to many risks and uncertainties.
Our
employees, independent contractors, consultants, commercial partners, collaborators and vendors may engage in misconduct or other improper
activities, including noncompliance with regulatory standards and requirements.
We
are exposed to the risk of employee fraud or other illegal activity by our employees, independent contractors, consultants, commercial
partners, collaborators and vendors. Misconduct by these parties could include intentional, reckless and/or negligent conduct that fails
to comply with the laws of the FDA and other similar foreign regulatory bodies, provide true, complete and accurate information to the
FDA and other similar foreign regulatory bodies, comply with manufacturing standards we have established, comply with healthcare fraud
and abuse laws in the United States and similar foreign fraudulent misconduct laws, or report financial information or data accurately
or to disclose unauthorized activities to us. If we obtain FDA approval of any of our product candidates and begin commercializing those
products in the United States, our potential exposure under such laws will increase significantly, and our costs associated with compliance
with such laws will also increase. These laws may impact, among other things, our current activities with principal investigators and
research patients, as well as proposed and future sales, marketing and education programs. Although we have adopted a code of business
conduct and ethics, it is not always possible to identify and deter misconduct by our employees, independent contractors, consultants,
commercial partners and vendors, and the precautions we take to detect and prevent this activity may not be effective in controlling
unknown or unmanaged risks or losses or in protecting us from governmental investigations or other actions or lawsuits stemming from
a failure to comply with these laws or regulations. If any actions are instituted against us and we are not successful in defending ourselves
or asserting our rights, those actions could result in the imposition of civil, criminal and administrative penalties, damages, monetary
fines, imprisonment, disgorgement, possible exclusion from participation in government healthcare programs, additional reporting obligations
and oversight if we become subject to a corporate integrity agreement or other agreement to resolve allegations of non-compliance with
these laws, contractual damages, reputational harm, diminished profits and future earnings and the curtailment of our operations.
Failure
to comply with health and data protection laws and regulations could lead to government enforcement actions (which could include civil
or criminal penalties), private litigation and/or adverse publicity and could negatively affect our operating results and business.
We
and any potential collaborators may be subject to federal, state and foreign data protection laws and regulations (i.e., laws and regulations
that address privacy and data security). In the United States, numerous federal and state laws and regulations, including federal health
information privacy laws, state data breach notification laws, state health information privacy laws and federal and state consumer protection
laws (e.g., Section 5 of the Federal Trade Commission Act), that govern the collection, use, disclosure and protection of health-related
and other personal information could apply to our operations or the operations of our collaborators. In addition, we may obtain health
information from third parties (including research institutions from which we obtain clinical trial data) that are subject to privacy
and security requirements under HIPAA, as amended by HITECH. Depending on the facts and circumstances, we could be subject to criminal
penalties if we knowingly obtain, use, or disclose individually identifiable health information maintained by a HIPAA-covered entity
in a manner that is not authorized or permitted by HIPAA.
International
data protection laws, including, but not limited to, Regulation 2016/679, known as the General Data Protection Regulation (“GDPR”)
may also apply to health-related and other personal information obtained outside of the United States. The GDPR went into effect on May
25, 2018. The GDPR introduced new data protection requirements in the European Union, as well as potential fines for noncompliant companies.
The regulation imposes numerous new requirements for the collection, use and disclosure of personal information, including more stringent
requirements relating to consent and the information that must be shared with data subjects about how their personal information is used,
the obligation to notify regulators and affected individuals of personal data breaches, extensive new internal privacy governance obligations
and obligations to honor expanded rights of individuals in relation to their personal information (e.g., the right to access, correct
and delete their data). In addition, the GDPR includes restrictions on cross-border data transfer. The GDPR will increase our responsibility
and liability in relation to personal data that we process, and we may be required to put in place additional mechanisms to ensure compliance
with the new EU data protection rules. In addition, as a result of the United Kingdom’s vote in favor of exiting the EU, often
referred to as Brexit, the United Kingdom’s Data Protection Act of 2018, as amended, may apply to health-related and other personal
information obtained outside of the United States.
Compliance
with U.S. and international data protection laws and regulations could require us to take on more onerous obligations in our contracts,
restrict our ability to collect, use and disclose data, or in some cases, impact our ability to operate in certain jurisdictions. Failure
to comply with U.S. and international data protection laws and regulations could result in government enforcement actions (which could
include civil, criminal, and administrative penalties), private litigation and/or adverse publicity and could negatively affect our operating
results and business. Moreover, clinical trial subjects about whom we or our potential collaborators obtain information, as well as the
providers who share this information with us, may contractually limit our ability to use and disclose the information. Claims that we
have violated individuals’ privacy rights, failed to comply with data protection laws, or breached our contractual obligations,
even if we are not found liable, could be expensive and time consuming to defend and could result in adverse publicity that could harm
our business.
Changes
in U.S. tax law could adversely affect our financial condition and results of operations.
The
rules dealing with U.S. federal, state, and local income taxation are constantly under review by persons involved in the legislative
process and by the Internal Revenue Service and the U.S. Treasury Department. Changes to tax laws (which changes may have retroactive
application) could adversely affect us or holders of our common stock. In recent years, many such changes have been made and changes
are likely to continue to occur in the future. Future changes in U.S. tax laws could have a material adverse effect on our business,
cash flow, financial condition or results of operations. We urge investors to consult with their legal and tax advisors regarding the
implications of potential changes in U.S. tax laws on an investment in our common stock.
Risks
Related to this Offering and Our Common Stock
The
price of our stock may be volatile, and you could lose all or part of your investment.
The
trading price of our common stock may be highly volatile and could be subject to wide fluctuations in response to various factors, some
of which are beyond our control, including limited trading volume. In addition to the factors discussed in this “Risk Factors”
section and elsewhere in this prospectus, these factors include:
● |
the
commencement, enrollment or results of clinical trials and pre-clinical studies of our drug candidates or those of our competitors; |
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any
delay in identifying and advancing a clinical candidate for our other development programs; |
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any
delay in our regulatory filings for our drug candidates and any adverse development or perceived adverse development with respect
to the applicable regulatory authority’s review of such filings, including, without limitation, the FDA’s issuance of
a “refusal to file” letter or a request for additional information; |
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adverse
results or delays in future clinical trials;
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our
decision to initiate a clinical trial, not to initiate a clinical trial or to terminate an existing clinical trial; |
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adverse
regulatory decisions, including failure to receive regulatory approval of for our drug candidates; |
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changes
in laws or regulations applicable to our drug candidates, including, but not limited to, clinical trial requirements for approvals; |
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adverse
developments concerning our manufacturers; |
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our
inability to obtain adequate product supply for any approved product or inability to do so at acceptable prices; |
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our
inability to establish collaborations, if needed; |
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our
failure to commercialize our product candidates, if approved; |
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additions
or departures of key scientific or management personnel; |
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unanticipated
serious safety concerns related to the use of our drug candidates; |
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introduction
of new products offered by us or our competitors; |
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announcements
of significant acquisitions, strategic partnerships, joint ventures or capital commitments by us or our competitors; |
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our
ability to effectively manage our growth; |
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actual
or anticipated variations in quarterly operating results; |
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our
cash position; |
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our
failure to meet the estimates and projections of the investment community or that we may
otherwise provide to the public;
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publication
of research reports about us or our industry, or product candidates in particular, or positive or negative recommendations or withdrawal
of research coverage by securities analysts; |
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changes
in the market valuations of similar companies; |
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changes
in the structure of the healthcare payment systems; |
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overall
performance of the equity markets; |
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sales
of our common stock by us or our stockholders in the future; |
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trading
volume of our common stock; |
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changes
in accounting practices; |
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ineffectiveness
of our internal controls; |
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disputes
or other developments relating to proprietary rights, including patents, litigation matters and our ability to obtain patent protection
for our technologies; |
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significant
lawsuits, including patent or stockholder litigation; |
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general
political and economic conditions; and |
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other
events or factors, many of which are beyond our control. |
In
addition, the stock market in general, and the market for biopharmaceutical companies in particular, have experienced extreme price and
volume fluctuations that have often been unrelated or disproportionate to the operating performance of these companies. Broad market
and industry factors may negatively affect the market price of our common stock, regardless of our actual operating performance. In the
past, securities class action litigation has often been instituted against companies following periods of volatility in the market price
of a company’s securities. This type of litigation, if instituted, could result in substantial costs and a diversion of management’s
attention and resources.
We
are currently listed on The Nasdaq Capital Market. However, if we fail to comply with the continued listing requirements of The Nasdaq
Capital Market, our common stock may be delisted and the price of our common stock and our ability to access the capital markets could
be negatively impacted.
On
June 12, 2023, we received written notice from the Nasdaq Stock Market, LLC (“Nasdaq”) that we were not in compliance with
Nasdaq Listing Rule 5550(a)(2), as the minimum bid price of our common stock had been below $1.00 per share for 30 consecutive business
days. In accordance with Nasdaq Listing Rule 5810, we have a period of 180 calendar days, or until December 11, 2023, to regain compliance
with the minimum bid price requirement. To regain compliance, the closing bid price of our common stock must meet or exceed $1.00 per
share for at least 10 consecutive business days during this 180 calendar day period. In the event we do not regain compliance by December
11, 2023, we may be eligible for an additional 180 calendar day grace period if we meet the continued listing standards, with the exception
of bid price, for The Nasdaq Capital Market, and we provide written notice to Nasdaq of our intention to cure the deficiency during the
second compliance period. On November 17, 2023, we announced that we would effect a 1-for-25 reverse stock split of our issued and
outstanding shares of common stock which will become effective at 4:01 pm Eastern time on November 20, 2023. Commencing with the opening
of trading on The Nasdaq Capital Market on November 21, 2023, our common stock will trade on a post-split basis. There can be no
assurance that such reverse stock split will enable us to regain compliance with the Nasdaq minimum bid price requirement.
On
November 10, 2022, we received a letter from Nasdaq notifying us that we are not in compliance with the minimum stockholders’ equity
requirement for continued listing on The Nasdaq Capital Market. Nasdaq Listing Rule 5550(b)(1) requires companies listed on The Nasdaq
Capital Market to maintain stockholders’ equity of at least $2,500,000 (the “Stockholders’ Equity Requirement”). In
our Quarterly Report on Form 10-Q for the quarter ended September 30, 2023, we reported stockholders’ equity of $1,756,923, which
is below the Stockholders’ Equity Requirement for continued listing. Pursuant to the letter, we have 45 calendar days, or
until December 26, 2023, to submit a plan to regain compliance. If the plan is accepted by Nasdaq, an extension of up to 180 calendar
days from November 10, 2023 may be granted for us to evidence compliance.
If
we are unable to maintain our listing on Nasdaq and we are unable to obtain listing on another national securities exchange, a reduction
in some or all of the following may occur, each of which could have a material adverse effect on our stockholders:
● |
the
liquidity of our common stock; |
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the
market price of our common stock; |
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● |
our
ability to obtain financing for the continuation of our operations; |
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|
● |
the
number of investors that will consider investing in our common stock; |
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|
● |
the
number of market makers in our common stock; |
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● |
the
availability of information concerning the trading prices and volume of our common stock; and |
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● |
the
number of broker-dealers willing to execute trades in shares of our common stock. |
The Nasdaq Capital
Market may seek to delist our common stock if it concludes this offering does not qualify as a public offering as defined under Nasdaq’s
stockholder approval rule.
The continued listing
of our common stock on The Nasdaq Capital Market depends on our compliance with the requirements for continued listing under the Nasdaq
Marketplace Rules, including, but not limited to, Market Place Rule 5635, or the stockholder approval rule. The stockholder approval
rule prohibits the issuance of shares of common stock (or derivatives) in excess of 20% of our outstanding shares of common stock without
stockholder approval, unless those shares are sold at a price that equals or exceeds the Minimum Price, as defined in the stockholder
approval rule, or in what Nasdaq deems a “public offering” as defined in the stockholder approval rule (a “Public Offering”).
The securities sold in this offering may be sold at a significant discount to the Minimum Price as defined in the stockholder approval
rule, and we do not intend to obtain the approval of our stockholders for the issuance of the securities in this offering. Accordingly,
we have sought to conduct, and plan to continue to conduct, this offering as a Public Offering as defined in the stockholder approval
rule, which is a qualitative analysis based on several factors as determined by Nasdaq, including by broadly marketing and offering these
securities in a firm commitment underwritten offering registered under the Securities Act. Demand for the securities sold by us in this
offering, and the final offering price for these securities, will be determined following a broad public marketing effort over several
trading days, and final distribution of these securities will ultimately be determined by the underwriter. Nasdaq has also published
guidance that an offering of securities that are “deeply discounted” to the Minimum Price (for example a discount of 50%
or more) will typically preclude a determination that the offering qualifies as Public Offering for purposes of the stockholder approval
rule. We cannot assure you that Nasdaq will determine that this offering will be deemed a Public Offering under the stockholder approval
rule. If Nasdaq determines that this offering was not conducted in compliance with the stockholder approval rule, Nasdaq may cite a deficiency
and move to delist our securities from The Nasdaq Capital Market. Upon a delisting from The Nasdaq Capital Market, our stock would likely
be traded in the over-the-counter inter-dealer quotation system, more commonly known as the OTC. OTC transactions involve risks in addition
to those associated with transactions in securities traded on the securities exchanges, such as The Nasdaq Capital Market, or, together,
Exchange-listed stocks. Many OTC stocks trade less frequently and in smaller volumes than Exchange-listed stocks. Accordingly, our stock
would be less liquid than it would be otherwise. Also, the prices of OTC stocks are often more volatile than Exchange-listed stocks.
Additionally, institutional investors are usually prohibited from investing in OTC stocks, and it might be more challenging to raise
capital when needed.
We
do not intend to pay dividends on our common stock so any returns will be limited to the value of our stock.
We
currently anticipate that we will retain future earnings for the development, operation and expansion of our business and do not anticipate
declaring or paying any cash dividends for the foreseeable future. Furthermore, future debt or other financing arrangements may contain
terms prohibiting or limiting the amount of dividends that may be declared or paid on our common stock. Any return to stockholders will
therefore be limited to the appreciation of their stock.
Our
principal stockholders and management own a significant percentage of our stock and will be able to exert significant control over matters
subject to stockholder approval.
As
of October 31, 2023, our executive officers, directors and their affiliates beneficially hold, in the aggregate, approximately
30.41% of our outstanding voting stock. These stockholders, acting together, would be able to significantly influence all matters requiring
stockholder approval. For example, these stockholders would be able to significantly influence elections of directors, amendments of
our organizational documents, or approval of any merger, sale of assets, or other major corporate transaction. This may prevent or discourage
unsolicited acquisition proposals or offers for our common stock that you may feel are in your best interest as one of our stockholders.
Failure
to maintain effective internal controls could cause our investors to lose confidence in us and adversely affect the market price of our
common stock. If our internal controls are not effective, we may not be able to accurately report our financial results or prevent fraud.
Effective
internal control over financial reporting is necessary for us to provide reliable financial reports in a timely manner. In connection
with the audit of our financial statements for the years ended December 31, 2022 and 2021, our independent registered public accounting
firm identified a material weakness. A material weakness is a significant deficiency, or a combination of significant deficiencies, in
internal controls over financial reporting such that it is reasonably possible that a material misstatement of the annual or interim
financial statements will not be prevented or detected on a timely basis. The material weaknesses that have been identified by our independent
registered public accounting firm relate to (i) the design and implementation of appropriate segregation of duties to separate the roles
of authorizing, initiating, and recording transactions or reviewing transactions for the completeness and accuracy of contracts with
financial reporting implications and (ii) us lacking sufficient appropriate accounting and reporting knowledge to effectively perform
review controls surrounding technical accounting matters. While we have initiated a procedure to remediate the material weakness by reviewing
the material contracts on a quarterly basis with the accounting department and supporting staff and intend to use third party experts
to review the accounting treatment for significant transactions and provide management with guidance on the treatment of the transactions,
we may not be successful in remediating such weaknesses in a timely manner, if at all, which may undermine our ability to provide accurate,
timely and reliable reports on our financial and operating results. Furthermore, if we remediate our current material weakness but identify
new material weaknesses in our internal control over financial reporting in the future, investors may lose confidence in the accuracy
and completeness of our financial reports and the market price of our common stock may be negatively affected. As a result of such failures,
we could also become subject to investigations by Nasdaq, the SEC, or other regulatory authorities, and become subject to litigation
from investors and stockholders, which could harm our reputation, financial condition or divert financial and management resources from
our business.
Our
Certificate of Incorporation, as amended (“Certificate of Incorporation”) provides that the Court of Chancery of the State
of Delaware will be the sole and exclusive forum for substantially all disputes between the Company and its stockholders, which could
limit stockholders’ ability to obtain a favorable judicial forum for disputes with the Company or its directors, officers or employees.
Our
Certificate of Incorporation provides that unless we consent in writing to the selection of an alternative forum, the State of Delaware
is the sole and exclusive forum for: (i) any derivative action or proceeding brought on behalf of us, (ii) any action asserting a claim
of breach of a fiduciary duty owed by any director, officer or other employee of our Company to us or our stockholders, (iii) any action
asserting a claim arising pursuant to any provision of the Delaware General Corporation Law (the “DGCL”) or our Certificate
of Incorporation or Bylaws, or (iv) any action governed by the internal affairs doctrine. This exclusive forum provision would not apply
to suits brought to enforce any liability or duty created by the Securities Act or the Exchange Act or any other claim for which the
federal courts have exclusive jurisdiction. To the extent that any such claims may be based upon federal law claims, Section 27 of the
Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act
or the rules and regulations thereunder.
Section
22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or liability
created by the Securities Act or the rules and regulations thereunder. However, our Certificate of Incorporation contains a federal forum
provision which provides that unless we consent in writing to the selection of an alternative forum, the federal district courts of the
United States of America will be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the
Securities Act.
These
choice of forum provisions may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes
with us or our directors, officers or other employees and may result in increased costs to our stockholders, which may discourage such
lawsuits against us and our directors, officers and other employees. Alternatively, if a court were to find our choice of forum provisions
contained in our Certificate of Incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated
with resolving such action in other jurisdictions, which could harm our business, results of operations, and financial condition.
Our
Certificate of Incorporation, Bylaws and Delaware law may have anti-takeover effects that could discourage, delay or prevent a change
in control, which may cause our stock price to decline.
Our
Certificate of Incorporation, our Bylaws and Delaware law could make it more difficult for a third party to acquire us, even if closing
such a transaction would be beneficial to our stockholders. We are authorized to issue up to 10 million shares of preferred stock. This
preferred stock may be issued in one or more series, the terms of which may be determined at the time of issuance by our board of directors
without further action by stockholders. The terms of any series of preferred stock may include voting rights (including the right to
vote as a series on particular matters), preferences as to dividend, liquidation, conversion and redemption rights and sinking fund provisions.
The issuance of any preferred stock could materially adversely affect the rights of the holders of our common stock, and therefore, reduce
the value of our common stock. In particular, specific rights granted to future holders of preferred stock could be used to restrict
our ability to merge with, or sell our assets to, a third party and thereby preserve control by the present management.
Provisions
of our Certificate of Incorporation, our Bylaws and Delaware law also could have the effect of discouraging potential acquisition proposals
or making a tender offer or delaying or preventing a change in control, including changes a stockholder might consider favorable. Such
provisions may also prevent or frustrate attempts by our stockholders to replace or remove our management. In particular, our Certificate
of Incorporation, our Bylaws and Delaware law, as applicable, among other things:
● |
provide
the board of directors with the ability to alter the Bylaws without stockholder approval; |
● |
establish
advance notice requirements for nominations for election to the board of directors or for proposing matters that can be acted upon
at stockholder meetings; and |
● |
provide
that vacancies on the board of directors may be filled by a majority of directors in office, although less than a quorum. |
Unstable
market and economic conditions and adverse developments with respect to financial institutions and associated liquidity risk may have
serious adverse consequences on our business, financial condition and stock price.
The
global credit and financial markets have recently experienced extreme volatility and disruptions, including severely diminished liquidity
and credit availability, declines in consumer confidence, declines in economic growth, inflationary pressure and interest rate changes,
increases in unemployment rates and uncertainty about economic stability. The financial markets and the global economy may also be adversely
affected by the current or anticipated impact of military conflict, including the conflict between Russia and Ukraine, terrorism or other
geopolitical events. Sanctions imposed by the United States and other countries in response to such conflicts, including the one in Ukraine,
may also adversely impact the financial markets and the global economy, and any economic countermeasures by the affected countries or
others could exacerbate market and economic instability. More recently, the closures of Silicon Valley Bank and Signature Bank and their
placement into receivership with the Federal Deposit Insurance Corporation (“FDIC”) created bank-specific and broader financial
institution liquidity risk and concerns. Although the Department of the Treasury, the Federal Reserve, and the FDIC jointly confirmed
that depositors at SVB and Signature Bank would continue to have access to their funds, even those in excess of the standard FDIC insurance
limits, under a systemic risk exception, future adverse developments with respect to specific financial institutions or the broader financial
services industry may lead to market-wide liquidity shortages, impair the ability of companies to access near-term working capital needs,
and create additional market and economic uncertainty. There can be no assurance that future credit and financial market instability
and a deterioration in confidence in economic conditions will not occur. Our general business strategy may be adversely affected by any
such economic downturn, liquidity shortages, volatile business environment or continued unpredictable and unstable market conditions.
If the equity and credit markets deteriorate, or if adverse developments are experienced by financial institutions, it may cause short-term
liquidity risk and also make any necessary debt or equity financing more difficult, more costly and more dilutive. Failure to secure
any necessary financing in a timely manner and on favorable terms could have a material adverse effect on our growth strategy, financial
performance and stock price and could require us to delay or abandon our business plans. In addition, there is a risk that one or more
of our current clients, financial institutions or other third parties with whom we do business may be adversely affected by the foregoing
risks, which may have an adverse effect on our business.
Our
management will have broad discretion over the use of the net proceeds from this offering, you may not agree with how we use the proceeds,
and the proceeds may not be invested successfully.
Our
management will have broad discretion as to the use of the net proceeds from this offering and could use them for purposes other than
those contemplated at the time of this offering. Accordingly, you will be relying on the judgment of our management with regard to the
use of these net proceeds, and you will not have the opportunity, as part of your investment decision, to assess whether the proceeds
are being used appropriately. It is possible that the proceeds will be invested in a way that does not yield a favorable, or any, return
for us.
You
may experience immediate and substantial dilution in the net tangible book value per share of the common stock you purchase in the offering.
The offering price per share in this
offering may exceed the net tangible book value per share of our common stock outstanding prior to this offering. After giving effect
to the sale by us of 2,105,263 shares of common stock , at an assumed public offering price of $4.75 per share, the last
reported sale price of our common stock as reported on The Nasdaq Capital Market on November 15, 2023 after giving effect to
the proposed Reverse Split, and after deducting commissions and estimated offering expenses payable by us, and assuming no sale
of any Pre-funded Warrants, you will experience immediate dilution of $0.98 per share, representing the difference between
our net tangible book value per share as of September 30, 2023 after giving effect to this offering and the offering price. The
exercise of outstanding warrants and stock options may also result in further dilution of your investment. See the section entitled “Dilution”
on page 54 below for a more detailed illustration of the dilution you may incur if you participate in this offering.
You
may experience future dilution as a result of future equity offerings.
In
order to raise additional capital, we may, in the future, offer additional shares of our common stock or other securities convertible
into or exchangeable for our common stock at prices that may not be the same as the price per share in this offering. We may sell shares
or other securities in any other offering at a price per share that is less than the price per share paid by investors in this offering,
and investors purchasing shares or other securities in the future could have rights superior to existing stockholders. The price per
share at which we sell additional shares of our common stock or securities convertible or exchangeable into common stock in future transactions
may be higher or lower than the price per share paid by investors in this offering.
Sales
of a substantial number of our shares of common stock in the public markets, or the perception that such sales could occur, could cause
our stock price to fall.
We
may issue and sell additional shares of our common stock in the public markets. As a result, a substantial number of our shares of common
stock may be sold in the public market. Sales of a substantial number of our shares of common stock in the public markets or the perception
that such sales could occur, could depress the market price of our common stock and impair our ability to raise capital through the sale
of additional equity securities.
Our
outstanding options and warrants, and the availability for resale of certain of the underlying shares, may adversely affect the trading
price of our common stock.
Our
outstanding options and warrants could adversely affect our ability to obtain future financing or engage in certain mergers or other
transactions, since the holders thereof may exercise them at a time when we may be able to obtain additional capital through a new offering
of securities on terms more favorable to us than the terms of outstanding securities. For the life of the options and warrants, the holders
have the opportunity to profit from a rise in the market price of our common stock without assuming the risk of ownership. The issuance
of shares upon the exercise of outstanding options and warrants would also dilute the ownership interests of our existing stockholders.
General
Risk Factors
Market
and economic conditions may negatively impact our business, financial condition and share price.
Concerns
over inflation, energy costs, geopolitical issues, the U.S. mortgage market and the real estate market, unstable global credit markets
and financial conditions, and volatile oil prices have led to periods of significant economic instability, diminished liquidity and credit
availability, declines in consumer confidence and discretionary spending, diminished expectations for the global economy and expectations
of slower global economic growth going forward, increased unemployment rates, and increased credit defaults in recent years. Our general
business strategy may be adversely affected by any such economic downturns, volatile business environments and continued unstable or
unpredictable economic and market conditions. If these conditions continue to deteriorate or do not improve, it may make any necessary
debt or equity financing more difficult to complete, more costly, and more dilutive. Failure to secure any necessary financing in a timely
manner and on favorable terms could have a material adverse effect on our growth strategy, financial performance, and share price and
could require us to delay or abandon development or commercialization plans.
Future
sales and issuances of our securities could result in additional dilution of the percentage ownership of our stockholders and could cause
our share price to fall.
We
expect that significant additional capital will be needed in the future to continue our planned operations, including research and development,
increased marketing, hiring new personnel, commercializing our products, and continuing activities as an operating public company. To
the extent we raise additional capital by issuing equity securities, our stockholders may experience substantial dilution. We may sell
common stock, convertible securities or other equity securities in one or more transactions at prices and in a manner we determine from
time to time. If we sell common stock, convertible securities or other equity securities in more than one transaction, investors may
be materially diluted by subsequent sales. Such sales may also result in material dilution to our existing stockholders, and new investors
could gain rights superior to our existing stockholders.
We
are an emerging growth company, and we cannot be certain if the reduced reporting requirements applicable to emerging growth companies
will make our common stock less attractive to investors.
We
are an emerging growth company, as defined in the JOBS Act. For as long as we continue to be an emerging growth company, we may take
advantage of exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth
companies, including not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act,
reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and exemptions from the
requirements of holding nonbinding advisory votes on executive compensation and stockholder approval of any golden parachute payments
not previously approved. We could be an emerging growth company for up to five years following the year in which we completed our initial
public offering, although circumstances could cause us to lose that status earlier. We will remain an emerging growth company until the
earlier of (i) the last day of the fiscal year (a) following the fifth anniversary of the completion of our initial public offering,
(b) in which we have total annual gross revenue of at least $1.235 billion or (c) in which we are deemed to be a large accelerated filer,
which requires the market value of our common stock that is held by non-affiliates to exceed $700.0 million as of the prior June 30th
and (ii) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period.
We
may choose to take advantage of some, but not all, of the available exemptions. We cannot predict whether investors will find our common
stock less attractive if we rely on certain or all of these exemptions. If some investors find our common stock less attractive as a
result, there may be a less active trading market for our common stock and our stock price may be more volatile.
Under
the JOBS Act, emerging growth companies can also delay adopting new or revised accounting standards until such time as those standards
apply to private companies, which may make our financial statements less comparable to companies that comply with new or revised accounting
pronouncements as of public company effective dates. We have chosen to take advantage of the extended transition periods available to
emerging growth companies under the JOBS Act for complying with new or revised accounting standards until those standards would otherwise
apply to private companies provided under the JOBS Act. As a result, our financial statements may not be comparable to those of companies
that comply with public company effective dates for complying with new or revised accounting standards.
Financial
reporting obligations of being a public company in the U.S. are expensive and time-consuming, and our management will be required to
devote substantial time to compliance matters.
As
a publicly traded company we incur significant additional legal, accounting and other expenses. The obligations of being a public company
in the U.S. require significant expenditures and place significant demands on our management and other personnel, including costs resulting
from public company reporting obligations under the Exchange Act and the rules and regulations regarding corporate governance practices,
including those under the Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, and The Nasdaq Capital Market.
These rules require the establishment and maintenance of effective disclosure and financial controls and procedures, internal control
over financial reporting and changes in corporate governance practices, among many other complex rules that are often difficult to implement,
monitor and maintain compliance with. Moreover, despite recent reforms made possible by the JOBS Act, the reporting requirements, rules,
and regulations will make some activities more time-consuming and costly, particularly after we are no longer an “emerging growth
company” or a “smaller reporting company.” Our management and other personnel will need to devote a substantial amount
of time to ensure that we comply with all of these requirements and to keep pace with new regulations, otherwise we may fall out of compliance
and risk becoming subject to litigation or being delisted, among other potential problems.
If
securities or industry analysts do not publish research or reports, or publish unfavorable research or reports about our business, our
stock price and trading volume may decline.
The
trading market for our common stock relies in part on the research and reports that industry or financial analysts publish about us,
our business, our markets and our competitors. We do not control these analysts. If securities analysts do not cover our common stock,
the lack of research coverage may adversely affect the market price of our common stock. Furthermore, if one or more of the analysts
who do cover us downgrade our stock or if those analysts issue other unfavorable commentary about us or our business, our stock price
would likely decline. If one or more of these analysts cease coverage of us or fails to regularly publish reports on us, we could lose
visibility in the market and interest in our stock could decrease, which in turn could cause our stock price or trading volume to decline
and may also impair our ability to expand our business with existing customers and attract new customers.
We
could be subject to securities class action litigation.
In
the past, securities class action litigation has often been brought against a company following a decline in the market price of its
securities. This risk is especially relevant for us because pharmaceutical companies have experienced significant stock price volatility
in recent years. If we face such litigation, it could result in substantial costs and a diversion of management’s attention and
resources, which could harm our business.
There is no established public trading market
for the Pre-funded Warrants being offered in this offering, and we do not expect a market to develop for the Pre-funded
Warrants.
There is no established public trading market for
the Pre-funded Warrants being offered in this offering, and we do not expect a market to develop. In addition, we do not intend
to apply to list the Pre-funded Warrants on any national securities exchange or other nationally recognized trading system. Without
an active market, the liquidity of the Pre-funded Warrants will be limited. Further, the existence of the Pre-funded Warrants
may act to reduce both the trading volume and the trading price of our common stock.
The Pre-funded Warrants are speculative
in nature.
Except as otherwise provided in the Pre-funded
Warrants, until holders of Pre-funded Warrants acquire our common stock upon exercise of the Pre-funded Warrants, holders
of Pre-funded Warrants will have no rights with respect to our common stock underlying such Pre-funded Warrants. Upon exercise
of the Pre-funded Warrants, the holders will be entitled to exercise the rights of a stockholder of our common stock only as to
matters for which the record date occurs after the exercise date.
Moreover, following this offering, the market value
of the Pre-funded Warrants is uncertain. There can be no assurance that the market price of our common stock will ever equal or exceed
the price of the Pre-funded Warrants, and, consequently, whether it will ever be profitable for investors to exercise their Pre-funded
Warrants.
USE
OF PROCEEDS
We
estimate that the net proceeds from our issuance and sale of shares of our common stock and Pre-funded Warrants in this offering
will be approximately $8.8 million, or approximately $10.2 million if the underwriters exercise their option to purchase
additional securities in full, based on an assumed public offering price of $4.75 per share, which was the closing price of our
common stock on The Nasdaq Capital Market on November 15, 2023, after deducting estimated underwriting discounts and commissions
and estimated offering expenses payable by us and after giving effect to the proposed Reverse Split, and assuming no sale of the Pre-Funded
Warrants.
We
intend to use the net proceeds from this offering for the advancement of TH104’s phase 2 trial expected in 2024. The balance
of the net proceeds is expected to be used for working capital and other general corporate purposes. We may also use a portion of the
net proceeds to in-license, acquire or invest in complementary businesses, technologies or products, however, we have no current commitments
or obligations to do so.
A
$0.50 increase or decrease in the assumed public offering price of $4.75 per share would increase or decrease the net proceeds
from this offering by approximately $1 million, assuming that the number of shares offered by us, as set forth on the cover page
of this prospectus, remains the same and after deducting the estimated underwriting discounts and commissions. An increase (decrease)
of 500,000 shares in the number of shares offered by us, as set forth on the cover page of this prospectus, would increase (decrease)
the net proceeds from this offering by approximately $2.2 million, assuming no change in the assumed public offering price per
share and after deducting estimated underwriting discounts and commissions.
This
expected use of the net proceeds from this offering and our existing cash represents our intentions based upon our current plans, financial
condition and business conditions. Predicting the cost necessary to develop product candidates can be difficult and the amounts and timing
of our actual expenditures may vary significantly depending on numerous factors, including the progress of our development and commercialization
efforts, any collaborations that we may enter into with third parties for our product candidates and any unforeseen cash needs. As a
result, our management will retain broad discretion over the allocation of the net proceeds from this offering and our existing cash.
The precise amount, use and timing of the application of such proceeds will depend upon our funding requirements and the availability
and cost of other capital.
Pending
our use of the net proceeds from this offering, we intend to invest the net proceeds in a variety of capital preservation investments,
including short-term, investment-grade, interest-bearing instruments, and government securities.
DILUTION
If
you invest in our common stock in this offering, your ownership interest will be diluted to the extent of the difference between the
offering price per share of our common stock and the as adjusted net tangible book value per share of our common stock immediately after
the offering. Historical net tangible book value per share represents the amount of our total tangible assets less total liabilities,
divided by the number of shares of our common stock outstanding.
The
historical net tangible book value of our common stock as of September 30, 2023 was approximately $1.8 million or $2.51
per share based on 700,474 shares of common stock outstanding on such date. Historical net tangible book value per share represents
the amount of our total tangible assets reduced by the amount of our total liabilities, divided by the total number of shares of common
stock outstanding.
After giving effect to the sale of shares
of our common stock and Pre-funded Warrants in this offering at an assumed public offering price of $4.75 per share, which
was the closing price of our common stock on The Nasdaq Capital Market on November 15, 2023, and after deducting the estimated
underwriting discounts and commissions and estimated offering expenses payable by us and after giving effect to the proposed Reverse
Split, and assuming no sale of the Pre-funded Warrants, our as adjusted net tangible book value at September 30, 2023 would
have been $10.6 million, or $3.77 per share of common stock. This represents an immediate increase in as adjusted
net tangible book value of $1.26 per share to existing stockholders and immediate dilution of $0.98 per share to new investors
purchasing shares of our common stock in this offering.
The
following table illustrates this dilution on a per share basis:
Assumed
public offering price per share |
|
|
|
|
|
$ |
4.75 |
|
Net
tangible book value per share as of September 30, 2023 |
|
$ |
2.51 |
|
|
|
|
|
Increase in
net tangible book value per share attributable to new investors in this offering |
|
|
1.26 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As
adjusted net tangible book value per share immediately after this offering |
|
|
|
|
|
|
3.77 |
|
|
|
|
|
|
|
|
|
|
Dilution
per share to new investors in this offering |
|
|
|
|
|
$ |
0.98 |
|
A
$0.50 increase (decrease) in the assumed public offering price of $4.75 per share, which was the closing price of our common
stock on The Nasdaq Capital Market on November 15, 2023, would increase (decrease) our as adjusted net tangible book value after
this offering by $0.34 per share and the dilution to new investors purchasing shares of our common stock in this offering by $0.34
per share, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same
and after deducting estimated underwriting discounts and commissions. An increase (decrease) of 500,000 shares in the number of
shares offered by us, as set forth on the cover page of this prospectus, would increase our as adjusted net tangible book value after
this offering by $0.78 per share and decrease the dilution to new investors purchasing shares of our common stock in this offering
by $0.78 per share, assuming no change in the assumed public offering price per share and after deducting estimated underwriting
discounts and commissions.
If the underwriters exercise their option to purchase
additional shares and/or Pre-funded Warrants in full, the as adjusted net tangible book value per share after giving effect to
the offering would be $3.83 per share. This represents an increase in net tangible book value of $1.32 per share to existing
stockholders and dilution in net tangible book value of $0.92 per share to new investors.
To
the extent that stock options or warrants are exercised, new stock options are issued under our equity incentive plan, or we issue additional
common stock in the future, there will be further dilution to investors participating in this offering. In addition, we may choose to
raise additional capital because of market conditions or strategic considerations, even if we believe that we have sufficient funds for
our current or future operating plans. If we raise additional capital through the sale of equity or convertible debt securities, the
issuance of these securities could result in further dilution to our stockholders.
The number of shares of our common stock to be outstanding
after this offering is based on 700,474 shares of our common stock outstanding as of October 31, 2023, assumes no exercise
by the underwriters of their over-allotment option and excludes:
|
● |
85,758
shares of common stock issuable upon exercise of outstanding options with a weighted average exercise price of $84.75; |
|
● |
13,860
shares of common stock issuable upon exercise of outstanding warrants with a weighted average exercise price of $74.75; |
|
● |
63,158
shares of common stock (or 72,632 shares if the representative exercises its over-allotment option in full) issuable upon
exercise of warrants to be issued to the representative of the underwriters as part of this offering at an exercise price of $5.94
(assuming a public offering price of $4.75 per share, the last reported sale price of our common stock as reported on
The Nasdaq Capital Market on November 15, 2023 after giving effect to the proposed Reverse Split). |
BUSINESS
Overview
Tharimmune is
a clinical-stage biotechnology company developing therapeutic candidates in rare, inflammatory and oncologic conditions with high
unmet need. On November 3, 2023, we entered into the Avior Patent License Agreement with Avior pursuant to which we received
an exclusive sublicensable right and license to Licensed Patent Rights and
Licensed Technology to, among other things, Develop, have Developed, make, have made, use, sell, import, export and commercialize TH104
and TH103 and to practice the Licensed Technology in connection with the foregoing, throughout the world.
See “Recent Developments” below for additional information. In February 2023, the FDA approved an IND application
for TH104. TH104 has a dual mechanism of action by affecting multiple receptors, known to suppress
chronic, debilitating pruritis or “uncontrollable itching”. With respect to TH104, we intend to first seek approval
for the treatment of moderate to severe chronic pruritis in patients with PBC, an orphan rare form of liver disease with no known cure
in which more than 70% of patients suffer from debilitating chronic pruritis, and with respect to TH103, we intend to develop the product candidate and potentially file an IND.
We
are also developing an early-stage pipeline of novel therapeutic candidates targeting validated high value IO targets including EGF HER2,
HER3 and PD-1. We are developing antibodies including bispecific antibodies, ADCs and small molecular weight bovine- derived Picobodies™
or antibody “knob” domains which have the potential to target and bind more tightly to “undruggable” epitopes
better than full sized antibodies. We are advancing TH3215, a bispecific against both HER2 and HER3 antibody which targets a novel “bridging
epitope” encompassing multiple domains of the HER2 ECD as well as ligand-dependent and independent blocking of the ECD of HER3
into IND-enabling studies in 2024. In addition, we anticipate that TH0059, a HER2/HER3 bsADC, and TH1940, a PD-1 Picobody, will progress
to enter IND-enabling studies in 2024.
The
EGF subset known as the epidermal growth factor receptor (“ErbB”) family of receptors are a validated set of targets preferentially
overexpressed on certain solid tumors which can be clinically exploited for the treatment of drug resistant cancers. The ErbB family
is encompassed of four members that belong to the transmembrane tyrosine kinase receptors (“TKR”), including EGFR (“HER1”),
HER2, HER3 and HER4. The most well-known member, HER2, encodes a transmembrane TKR which is comprised of three domains: an ECD, a transmembrane
domain and an intracellular tyrosine kinase domain. Ligand binding results in heterodimerization or homodimerization between the ErbB
receptors leading to excitation of the intracellular tyrosine kinase domain which then activates downstream signaling pathways concerning
cellular proliferation, differentiation, migration and apoptosis.
HER2
is an orphan receptor lacking a unique endogenous ligand and preserves an active conformation, making it continuously available to dimerize
and preferred as a partner for neighboring member receptors. Juxtaposed to this distinct HER2 characterization, HER3 has several ligands
yet it lacks intrinsic tyrosine kinase activity. Furthermore, HER2-HER3 pairing exhibits a favorable and more potent signaling, suggesting
a corresponding action between both receptors.
HER2
is a known oncogene recognized in numerous cancer types and dysregulation of HER2 signaling can be caused by mutation, amplification
and overexpression. Numerous cancers exhibit high levels of HER2 compared to normal tissue, specifically tumors of the breast, colorectal,
bladder, gastric, esophageal, endometrial, and ovarian cancers, signifying that HER2 may be connected to the progression of these tumors.
Additionally, following the discovery of HER2 in breast cancer, antibody drugs targeting HER2 were introduced into the clinic. HERCEPTIN®
(trastuzumab), the first monoclonal antibody developed by Genentech/Roche was approved for the treatment of HER2-positive metastatic
breast cancer in 1998. Subsequently, tyrosine kinase inhibitors (“TKIs”) and ADCs targeting HER2 have been approved. Another
antibody, PERJETA® (pertuzumab) also developed by Genentech/Roche, used in combination with trastuzumab, and docetaxel was approved
in 2012, indicated for the treatment of patients with HER2-positive metastatic breast cancer. The FDA subsequently also approved a third
biologic from Genentech/Roche in 2013, KADCYLA® (trastuzumab emtansine or T-DM1), for the treatment of patients with HER2-positive
metastatic breast cancer in patients previously treated with trastuzumab and a taxane. T-DM1 not only retains the target-selective benefit
of trastuzumab, but also kills tumor cells by delivering a potent toxin which inhibits microtubule function and has become a classic
example of a targeted ADC treatment. Another ADC, ENHERTU® (trastuzumab deruxtecan), developed by Daiichi Sankyo and AstraZeneca
and approved in December 2019 for the treatment of unresectable or metastatic HER2-positive breast cancer has shown anti-tumor activity
in HER2-positive cancers that were resistant or insensitive to T-DM1. We believe this development history of multiple approved drugs
with different modalities and novel epitopes targeting HER2 has paved a de- risked regulatory pathway as well left significant room for
continued innovation in this class of therapies. According to the Fierce Pharma, in 2022, Roche/Genentech had worldwide sales of over
$8 billion with respect to their HER2 targeted therapies (Herceptin and Perjeta) as well as more than $500 million in worldwide sales
of ENHERTU® in the first half of 2023 alone according to AstraZeneca.
The
function of HER3 in tumor biology is multidimensional. Abundant HER3 expression is identified in various solid tumor types, with a proven
role in disease progression. Overexpression of HER3 signaling is thought to be involved in resistance to other targeted therapies used
for treating several cancers, including anti-EGFR therapies gefitinib and cetuximab. One of the many genomic changes known to be implicated
in acquired resistance to anti-EGFR TKIs in patients with EGFR-mutated advanced non-small-cell lung cancer is HER3 up-regulation promulgated
by osimertinib. Therefore, blocking HER3/EGFR dimerization complex is thought to prevent or slow down both acquired and primary resistance
to EGFR inhibitors. We believe combining anti-HER2 with an anti-HER3 strategy as a bispecific multifunctional agent without a toxin (TH3215)
as well as with a toxin (TH0059) could capitalize on some of the findings described in the literature to take advantage of precise tumor-killing
through two important targets with different mechanisms of action.
PD-1
is an immunosuppressive checkpoint and seen in macrophages, B lymphocytes, dendritic cells, monocytes, tumor-specific activated T cells,
myeloid cells and natural killer cells in circumstances of chronic antigen contact. PD-L1 is one of the PD-1 ligands. PD-L1 expression
has been shown to be a valuable biomarker for the prognosis and prediction of the sensitivity of PD-1/PD-L1 inhibitors. The expression
of PD-L1 is mainly expressed in tumor cells, tumor-infiltrating cells and antigen-presenting cells in many cancers. Despite the noteworthy
efficacy of PD-1/PD-L1 immune checkpoint inhibitors (“ICI”) in the treatment of tumors, some problems remain such as drug
resistance and adverse events. Acquired drug resistance may present despite resuming or continuing treatment with anti-PD-1/PD-L1 immunotherapy.
The presence of drug resistance significantly reduces the efficacy of anti-PD-1/PD-L1 immunotherapy. We believe exploring the mechanisms
of PD-1/PD-L1 ICI resistance may assist with the discovery of new immunotherapeutic strategies to control disease progression and provide
a more sustainable survival benefit for patients. As such, we aim to further improve on PD-1 as a breakthrough technology by developing,
TH1940, a proprietary PD-1 Picobody with unique binding affinity different than currently available PD-1 drugs. We believe this unique
binding difference allows for novel therapeutic possibilities both as a stand-alone agent and in combination and that our tumor immunotherapy
based on PD-1 inhibition may become a future strategy for human cancers.
We
have deprioritized our previous preclinical candidate, HSB-1216, due to a strategic reprioritization of our vision to
focus on therapeutics in high unmet need cancers focused on novel epitopes of certain antitumor drug targets.
Our
Portfolio
We
currently have two bispecific candidates and a Picobody candidate in pre-clinical development and we recently entered into the Avior Patent License Agreement with respect to
IND-approved transmucosal film product. The following table summarizes our development candidate pipeline:
Our
Strategy
Our
goal is to become a leading biotechnology company developing novel treatments in rare, inflammatory and oncologic diseases with high
unmet needs. Our business strategy comprises the following components:
| 1. | Develop TH104
as a transmucosal buccal film product for the treatment of chronic pruritis in PBC and other
inflammatory diseases. |
| | |
| 2. | Continue
to advance TH3215 as an anti-HER2/HER3 BspAb for multiple tumor types including high unmet
need cancers. |
| | |
| 3. | Effectively
create a strategy to develop TH0059 as a bispecific monoclonal ADC specifically targeted
to both HER2 and HER3 receptors in high unmet need standard-of-care resistant tumors with
a high capacity to metastasize. |
| | |
| 4. | Create
a preclinical and clinical path forward for our third product candidate, TH1940, a unique
PD-1 Picobody with unique binding differentiation compared to full length antibodies for
IO vulnerable tumors. |
| | |
| 5. | Hasten
the discovery and development of next generation multi-specific (bi- and tri) antibodies
with binding capabilities to novel epitopes of combinations of HER2, HER3, PD-1, PD-L1, TROP2
and other validated targets with and without toxin delivery capacity to multiple high unmet
need rare cancers. |
| | |
| 6. | Pursue
strategic collaboration opportunities to maximize the value of our pipeline to bring novel
therapies to patients suffering from high unmet need conditions. |
Background
on Antibodies
Full-length
human antibodies play a crucial role in drug development as therapeutic agents. Antibodies are large Y-shaped proteins produced by the
immune system to identify and neutralize extraneous elements such as bacteria, viruses, and additional pathogens. Their capability to
target particular molecules with high specificity and affinity are valuable tools in pharmaceutical therapeutics. For drug development,
much research has enabled the generation of full-length human antibodies targeting a variety of pathophysiological agents, anomalous
cells, or malfunctioning proteins associated in different diseases. Using an array of methodologies, these antibodies can be developed
using different approaches, including phage display, hybridoma technology, and techniques involving novel antibody engineering focused
on structural diversity. The realization of numerous therapeutic antibodies has considerably affected the treatment of diverse diseases,
including cancer, autoimmune disorders, infectious, and inflammatory conditions. Their promising therapeutic properties, including decreased
toxicity and augmented specificity compared to small molecules and other modalities with off-target effects, make them appealing candidates
for human therapeutic development.
A
large number of traditional antibodies are composed of immunoglobin G (IgG) format in a Y-shape molecule consisting of two heavy chains
which are identical as well as two light chains also identical. A heavy chain pairs with a light chain to form two variable regions,
or antibody binding fragment (Fab) which binds to antigens of the target. The constant region includes a region referred to as the fragment
crystallizable (Fc) which binds to receptors present on cells in the immune system known as effector cells. In traditional full length
monoclonal antibodies, the variable regions are identical and bind to the same target.
Bispecific
antibodies are a specialized class of therapeutic antibodies designed to concurrently target two dissimilar antigens. Unlike traditional
monoclonal antibodies that bind to a single target, bispecific antibodies can employ multi-specific targeting, offering distinctive benefits
in drug development. By targeting two separate molecules involved in a disease process, bispecific antibodies enhance therapeutic efficacy,
improve target specificity, and potentially overcome certain treatment resistance mechanisms. The development of bispecific antibodies
involves different engineering strategies including quadroma technology, chemical conjugation-based methods and more recent technologies
including Dual Variable Domain Immunoglobulin and two-in-one models can be employed to generate bispecific antibodies. These bispecific
agents can target a diversity of disease-related pathways, creating adaptable molecules for numerous medical ailments, including cancer.
Ongoing research and improvements over the last decade in antibody engineering allow for the design, optimization and scale-up of bispecific
antibodies for human therapeutics development.
Our
Pipeline Candidates
TH104
TH104
is a product which has been developed by embedding drug onto a proprietary transmucosal buccal film which adheres to the inside of the
mouth. TH104 has key features which we believe make it an ideal product candidate for multiple liver-related and other pruritogenic inflammatory
conditions. The active molecule, nalmefene, has a dual mechanism of action by affecting both the µ-opioid receptor and the kappa
opioid receptor as well as inhibiting IL-17 inflammatory cytokine expression. We intend to launch and complete a phase 1 pharmacokinetic
trial for TH104 in early 2024 as well as a phase 2 proof-of-concept trial in PBC patients over approximately 12 months after aligning
with FDA on trial design by November 2024. We believe that it will cost approximately $10 million to complete the phase 2 proof-of-concept
trial in PBC patients. We believe TH104 may also be used for treating chronic pruritogenic conditions associated with cholestatic
liver disease as well as other liver related and non-liver related diseases including fatty and alcoholic liver, non-alcoholic liver
disease and certain types of hepatitis. Chronic pruritis is significant in liver diseases as well as chronic kidney diseases, hemodialysis
and atopic dermatitis.
TH3215
Our
pre-clinical, current lead product candidate, TH3215, is an anti-HER2/HER3 bispecific antibody candidate. The ErbB or HER family of cell
surface proteins are some of the most well-known and validated oncology drug targets including ErbB2 or HER2 and Erb3 or HER3. Our antibodies
against HER2 and HER3 bind to different domains of the extracellular portion of the proteins or epitopes with trastuzumab primarily binding
the ECD IV of HER2. HER2 is a validated tumor antigen for antibody drug conjugates to treat HER2 positive cancers with two approved
antibodies, Roche/Genentech’s KADCYLA® and Daiichi Sankyo/AstraZeneca’s ENHERTU®. Areas of interest for the development
of TH3215 are as a treatment of solid tumors in which HER2 is overexpressed includes breast cancer, colorectal cancer, endometrial cancer
and gastroesophageal cancer.
The
ErbB family of receptor tyrosine kinases, also known as Human Epidermal Growth Factor Receptor (“HER”) family, comprises
four transmembrane receptors: HER1 (EGFR/ErbB1), HER2 (Neu/ErbB2), HER3 (ErbB3), and HER4 (ErbB4). These receptors play crucial roles
in the regulation of cell proliferation, survival, differentiation, and migration. The ErbB family members are activated upon binding
to specific ligands, including EGF, transforming growth factor-alpha (TGF-α), amphiregulin (“AR”), and others, resulting
in receptor dimerization and autophosphorylation of specific tyrosine residues within their intracellular domains.
HER1,
also known as EGFR, is the prototypical member of the ErbB family and is widely expressed in various tissues. Its activation initiates
a downstream signaling cascade that involves the activation of the mitogen-activated protein kinase (“MAPK”) and phosphoinositide
3-kinase (“PI3K”)/AKT pathways, leading to cell proliferation and survival. HER1 dysregulation has been implicated in various
cancers, making it an important therapeutic target.
HER2,
also known as Neu or ErbB2, lacks a ligand-binding domain, and its activation is predominantly through heterodimerization with other
ErbB family members. It is a key partner in heterodimerization with HER3, forming the most potent signaling complex among the ErbB receptors.
This heterodimerization is thought to cause an oncogenic signal into cells overexpressing these receptors and cause tumorigenesis. HER2
is amplified and overexpressed in certain cancers, particularly breast cancer, contributing to aggressive tumor behavior and poor prognosis.
HER3,
or ErbB3, possesses impaired tyrosine kinase activity, but its dimerization with other ErbB receptors, particularly HER2, leads to the
activation of downstream signaling pathways. HER3 is a critical regulator of PI3K signaling, which is crucial for cell survival and proliferation.
HER3 overexpression is associated with resistance to HER2-targeted therapies, making it an attractive target for cancer treatment. Furthermore,
agents that may block both HER2 and HER3 signaling, in both ligand-dependent and independent pathways could be highly attractive strategies
for human therapeutic development.
HER4,
or ErbB4, exists in various isoforms and exhibits diverse functions depending on tissue context. HER4 activation can result in the activation
of both the MAPK and PI3K/AKT pathways, but its signaling outcomes are complex and context-dependent. HER4 plays important roles in heart
development, neural development, and breast tissue differentiation.
The
ErbB family of receptor tyrosine kinases represent a closely synchronized signaling system that controls central cellular activities.
Dysregulation of these receptors, either through mutations, amplifications, or overexpression, provides to the development and evolution
of several cancers. Elucidating the elaborate signaling pathways and communications within the ErbB family is fundamental for developing
targeted therapies to efficiently treat cancer and other diseases associated with aberrant ErbB signaling. Ongoing research continues
to unveil the complexities of ErbB signaling, opening new avenues for innovative therapeutic strategies and personalized medicine approaches.
On the ABSI Effective Date, we entered into the
ABSI Agreement with ABSI pursuant to which ABSI granted us an exclusive royalty-bearing, sublicensable license to the ABSI Patents (as
defined in the ABSI Agreement) and a non-exclusive, royalty-bearing, sublicensable license to the ABSI Know-How (as defined in the ABSI
Agreement) to Exploit (as defined in the ABSI Agreement) the ABSI Products (as defined in the ABSI Agreement) for the treatment, diagnosis,
prediction, detection or prevention of disease in humans and animals worldwide. Pursuant to the ABSI Agreement, the parties shall form
a committee to manage the preclinical, investigational new drug enabling studies and such other activities as shall lead to the initiation
of a Phase 1 clinical trial of the ABSI Product. The parties will collaborate on a Target-by-Target basis to identify and evaluate ABSI
Products directed against such Target with a view to identifying or generating suitable Products (as defined in the ABSI Agreement) for
our Company to Exploit. Upon completion of the Discovery Timeline (as defined in the ABSI Agreement) for a Target, subject to the terms
and conditions of ABSI Agreement, we shall exclusively own any ABSI Products against such Target. In the event the committee determines
that the discovery activities are unsuccessful with respect to a Target, we may propose an additional target, which, upon approval by
ABSI, shall replace a failed Target. The antibodies from ABSI we are licensing are intended to
be developed as unique from the currently approved anti-HER2 antibodies and may be incorporated into proprietary multi-format biologics
(bi- and tri-specific antibodies, ADCs, CAR-T and CAR-NKs) against drug resistant cancers including HER2-positive metastatic breast cancer,
gastric cancer, lung cancer and ovarian cancer.
In
the past decade, cancer therapy has seen significant innovations, and one class of therapeutics gaining significant attention is bispecific
antibodies. These specialized molecules are engineered to target two distinct antigens boosting their specificity and therapeutic potential.
Among the most promising targets in oncology are HER2 and HER3 receptors, which play crucial roles in cell signaling and proliferation.
HER2
and HER3 are members of the ErbB family of receptor tyrosine kinases, and their dysregulation is associated with the development and
progression of various cancers, including breast, ovarian, gastric, and lung cancers. HER2, also known as ErbB2, is overexpressed in
approximately 20-30% of breast cancers and is linked to aggressive tumor behavior and poor prognosis. HER3, on the other hand, lacks
intrinsic kinase activity but forms heterodimers with other ErbB family members, particularly HER2, leading to potent signaling through
the PI3K/AKT pathway.
Traditional
monoclonal antibodies targeting either HER2 or HER3 have shown promising clinical outcomes in some cancer patients; however, cancer cells
often develop resistance mechanisms, leading to treatment failure. To overcome this challenge, researchers have turned to bispecific
antibodies as a more effective approach to disrupt multiple signaling pathways simultaneously and prevent the emergence of resistance.
Bispecific
antibodies that target both HER2 and HER3 receptors offer several advantages over traditional therapies. By simultaneously binding to
both receptors, these antibodies can block the formation of heterodimers between HER2 and HER3, effectively inhibiting downstream signaling
cascades that drive tumor growth and survival. Additionally, bispecific antibodies can also engage immune cells, such as T cells and
natural killer cells, through their Fc region, promoting the destruction of cancer cells via antibody-dependent cell-mediated cytotoxicity
and antibody-dependent cellular phagocytosis.
TH0059
Our second
product candidate, TH0059, is a bispecific anti-HER2/anti-HER3 monoclonal ADC candidate. Research studies elucidating the biology
of HER3 reveal that triggering of HER3 signaling stimulates tumor progression via augmentation of metastatic potential and induces treatment
failure in human tumors. Mounting evidence supports HER3 as an important target and its activation is considered to be required to overcome
therapeutic resistance, enhance efficacy, and increase patient survival. To date, to our knowledge, is no FDA-approved HER3-targeted
therapy for cancer treatment. Targeting both HER2 and HER3 with a blocking antibody is a strategy we intend to explore as we progress
our pipeline.
TH1940
Our third product candidate,
TH1940, is a proprietary IO biologic, in development targeting PD-1. On November 21, 2022, we entered into a research collaboration and
product license agreement with Minotaur and a commercial license agreement with Taurus for use of certain technology, including OmniAb
antibodies, to advance Picobodies against novel, unreachable and undruggable epitopes in high-value validated targets starting with PD-1.
The research and collaboration agreement and product license agreement are for the development of proprietary targeted biologics, including
TH 1940, against PD-1. It is anticipated that we will collaborate with Minotaur under the license from Taurus to discover, develop and
advance biotherapeutics against high-value validated IO targets starting with PD-1. We extended this agreement in July of 2023 with an
additional target (HER3) and an oncology target.
Picobodies
are bovine-derived antibody “knob” domains comprised of cysteine-rich ultralong complementary determining region H3 sequences
of 30-40 amino acids weighing ~3-4 KDa, which have the potential to access challenging undruggable epitopes better than full size antibodies
can. By extending the half-life of knobs to create TH1940, we believe we can more efficiently target novel epitopes with greater binding
affinity than approved anti-PD-1 antibodies. We further believe that the development of TH1940 is a step toward enabling us to enter
the rapidly growing IO market with additional targets thereafter.
Source:
Proceedings of the National Academy of Sciences of the United States of America “The smallest functional antibody fragment: Ultralong
CDR H3 antibody knob regions potently neutralize SARS-CoV-2”
Our
Other Product Candidates
We
intend to further develop our pipeline with novel bispecific monoclonal antibodies. These bispecific antibodies are planned to simultaneously
bind to two different antigens or to two different epitopes on the same antigen. Whether two different antigens or two epitopes on the
same antigen, the bispecific antibody could bind its targets either on the same cell (cis) or on to different cells (trans).
Our strategy involves targeting PD-1 combined with a known, validated undisclosed antigen or using HER2 instead of PD-1 while naturally
occurring antibodies typically only target one epitope on one antigen.
Recent
Developments
On the
Avior Effective Date, we entered into the Avior Patent License Agreement with Avior pursuant to which we received an exclusive
sublicensable right and license to Licensed Patent Rights
and Licensed Technology to, among other things, Develop, have Developed, make, have made, use, sell, import, export and
commercialize TH104 and TH103 and to practice the Licensed Technology in connection with the foregoing, throughout the world.
Pursuant to the Avior Patent License Agreement, we shall pay Avior a mid six digit up front license fee within ten days of the Avior
Effective Date and an additional mid six digit license fee which shall be paid in four equal installments within ten days of the end
of each fiscal quarter following the Avior Effective Date. In addition, we shall pay Avior a high single digit percentage of any
upfront payments received by us as a result of the grant of any sublicenses with respect to AV104. We shall also pay Avior milestone
payments in the aggregate amount of $24,250,000 upon the occurrence of various development milestones. Furthermore, we shall pay
Avior certain fees based upon sales milestones. The payments for such sales milestones range from the low seven digits to the low
eight digits with higher sales being subject to higher fees. Finally, we shall pay Avior royalties based on net sales. Such
royalties range from low single digit percentages to mid single digit percentages with higher sales being subject to lower
percentages. The Avior Patent License Agreement shall expire upon the expiration of the final payment obligation due to Avior as set
forth in such agreement. Upon the expiration of the Avior Patent License Agreement, we shall have a fully paid, irrevocable, freely
transferable and sublicensable worldwide license to the Licensed Patent Rights and Licensed Technology to Develop, have Developed,
make, have made, use, have used sell, offer for sale, have sold, import, have imported, export, have exported, commercialize or have
commercialized any and all Licensed Products and to practice the Licensed Technology worldwide. Pursuant to the Avior Patent License
Agreement, we may terminate the agreement at any time without cause, upon 30 days’ prior written notice to Avior along with
payment of the next unpaid Development Milestone Payment, if any. Furthermore, either we or Avior may terminate the Avior Patent
License Agreement (i) on written notice to the other party if the other party materially breaches any provision of the Avior Patent
License Agreement and fails to cure such breach within 30 days after the breaching party receives written notice thereof or (ii) on
written notice in the event that either party (A) becomes insolvent or admits its inability to pay its debts generally as they
become due; (B) becomes subject, voluntarily or involuntarily, to any proceeding under any domestic or foreign bankruptcy or
insolvency law, which is not fully dismissed or vacated within 60 days; (C) is dissolved or liquidated or takes any corporate action
for such purpose; (D) makes a general assignment for the benefit of creditors; or (E) has a receiver, trustee, custodian or similar
agent appointed by order of any court of competent jurisdiction to take charge of or sell any material portion of its property or
business. Upon termination of the Avior Patent License Agreement, the license granted pursuant to such agreement shall terminate and
all rights in the Licensed Patent Rights and Licensed Products shall revert back Avior.
According
to the National Institute of Diabetes and Digestive and Kidney Diseases (NIDDK), part of the National Institutes of Health, PBC,
is a chronic disease in where the bile ducts in the liver eventually become dysfunctional and cause the buildup of bile which causes
liver damage. The disease, believed to be an autoimmune condition, affects both men and women with a rate higher in women, estimated
at 1 out of every 1,000 women over 40. Pruritus is one of the most common conditions associated with PBC affecting up to 75% of individuals
at some point during their disease course. It has a negative impact on health-related quality of life with limited treatment options.
In an on-line survey focusing on certain features of patients’ itch respondents described their itch as “bugs crawling”
as well as more than 65% of participants reporting that the itch was worse at night, known as nocturnal pruritis.
Treatment
Ladder for Pruritis in Primary Biliary Cholangitis
Source:
Hegade VS, Bolier R, Oude Elferink RPJ, et. al. Frontline Gastroenterology 2016;7:158–166
ENBD,
endobiliary nasal drainage; MARS, molecular adsorbent recirculating system; LT, liver transplantation
The
current treatment ladder in pruritis for PBC shown above is the paradigm of therapy and if there is no response with one category of
drugs, typically patients “move up” the ladder. A patient may need a combination of treatments to achieve and/or maintain
symptom remission.
Endogenous
opioid peptides are commonly believed to play a role in the modulation of cholestatic itch. In the late 1980s, data documented that nalmefene
induced opiate-like withdrawal symptoms in individuals with cholestasis. Following this, research noted heightened levels of Met-enkephalin
in the plasma of cholestatic patients. In animal experiments, the activation of μ-opioid receptors by agonists induced scratching
behavior, while κ-opioid receptor agonists, on the contrary, reduced the sensation of itch.
Source:
Kim BS, Inan S, Ständer S, Sciascia T,Szepietowski JC, Yosipovitch G. Role of kappa-opioid and mu-opioid receptors in pruritus:
Peripheral and central itchcircuits. Exp Dermatol. 2022; 31:1900-1907. doi:10.1111/exd.14669
TH104
is a product which has been developed by embedding drug onto a proprietary transmucosal buccal film which adheres to the inside of the
mouth. TH104 has key features which we believe make it an ideal product candidate for multiple liver-related and other pruritogenic inflammatory
conditions. The active molecule, nalmefene, has a dual mechanism of action by affecting both the µ-opioid receptor and the kappa
opioid receptor as well as inhibiting IL-17 inflammatory cytokine expression, a cytokine known to be overexpressed in PBC patient
liver tissue and serum.
Sources:
Moniaga CS, et. al. Plasma dynorphin A concentration reflects the degree of pruritus in CLD Acta Derm Venereol. 2019 Apr 1;99(4):442-443.
doi: 10.2340/00015555-3139; Bergasa N et. al. Oral nalmefene therapy reduces scratching activity due to the pruritis of cholestasis:
a controlled study J Am Acad Dermatol 1999;41:431-4
Previous
data by Bergasa et. al, reported a study utilizing oral doses of nalmefene ranging from 40 to 240 mg twice-daily for 12 weeks
in PBC patients. Eight patients who received at least 1 course of nalmefene were available for comparison with corresponding control
data (a course of placebo and/or at baseline). Nalmefene therapy was associated with a 75% reduction in hourly scratching activity (P
< .01). The study also achieved a decrease in the mean of a visual analogue score of the perception of pruritus in all 8 patients
(mean decrease 77%, P < .01).
When
the itch circuitry is imbalanced in diseased conditions, pharmacological intervention can help suppress this phenomenon which occurs
in patients suffering from chronic pruritis. Nalmefene crosses into the circulation via a proprietary buccal delivery by adhering the
drug-coated film inside the cheek where the film biodegrades in minutes and the drug is absorbed. The buccal delivery of the drug bypasses
the liver’s first-pass metabolism thus creating high drug concentrations in the skin, an added benefit for treating conditions
in which the liver may be impaired.
TH104
data exists from multiple phase 1 ex-US trials achieved primary objective of predictable pharmacokinetic profiling with favorable safety
and tolerability. The first human phase 1 trial was a single-dose, single-center, open-label, randomized, 2-way crossover study of TH104
transmucosal buccal film compared to a tablet formulation marketed in Europe and not the United States, with a 14-day washout period
involving 12 normal healthy volunteers under fasting conditions. The primary outcome measure was to determine the pharmacokinetics of
a buccal dose of TH104, while secondary objectives included establishing the relative bioavailability of TH104 and evaluating its’
tolerability for potential value in clinical efficacy studies. These data were also consistent with the comprehensive pre-clinical data
package submitted to the FDA as an IND which was approved in February 2023, including pharmacokinetic profiling in beagle dog studies
confirming once-daily dosing, fast or rapid onset and high bioavailability when comparing TH104 to intravenous nalmefene.
In this study, the pharmacokinetic
evaluation of TH104 transmucosal film compared to an oral tablet marketed in Europe but not the United States, given as an equal-labelled
dose in normal healthy volunteers under fasting conditions, was consistent and similar in comparison with results from the literature.
The Cmax and AUC0-∞ of TH104 was observed to be higher than the tablet product because of a possible reduced
presystemic metabolism in the lower GI and liver, which is potentially advantageous for patients with an impaired liver. The half-life
and Tmax was observed to be similar for both products. There were no deaths, other serious adverse events, or other significant
adverse events reported during the entire study with events consistent with the safety profile of the marketed tablet in the literature
including mild dizziness, headache and somnolence, nausea and vomiting.
The second phase 1 study was a single-dose,
single-center, open-label, parallel group design with 2 treatment groups of 2 different formulations of TH104 with variable pH in sixteen
normal healthy volunteers under fasting conditions. The primary outcome measure was to determine the effect of pH in the transmucosal
buccal film on drug absorption profile evaluated from serial blood sample collections.
In this study, the evaluation of TH104
transmucosal film given as an equal-labelled dose in 2 different pH formulations delivered buccally to normal healthy volunteers under
fasting conditions, had an insignificant effect on the performance of the film as measured by drug concentrations in human plasma. The
low impact on pH shows that variations of oral pH due to inter-patient variability in future studies would have a low impact on predictable
drug absorption with regards to speed of delivery and drug action once absorbed into the systemic circulation.
A third study performed with TH104
buccal film compared an oral solution of the active ingredient showed a faster increase in plasma concentration and higher absorption
with TH104 compared to orally ingested drug.
There
were no new adverse events in these studies with events correlated with the previous study 1 and a safety profile consistent with the
literature.
We
intend to launch and complete a phase 1 pharmacokinetic trial for TH104 in early 2024. The clinical data package is strengthened by the
phase 1 clinical trials previously conducted outside of the U.S., which showed reliable bioavailability of the active ingredient in TH104
via transmucosal film technology in healthy volunteers. We intend to provide topline data in 2024 for a phase 1 pharmacokinetic bridging
study in the United States designed as a single-dose, single-center, open-label, randomized 2-way crossover study of TH104 transmucosal
buccal film and an intravenous dose of drug administered under fasting conditions, with a 7 to 11-day washout period between doses. Sixteen
normal healthy volunteers will participate in the study. The primary objective is to evaluate the absolute bioavailability of TH104 as
well as assess safety and tolerability of the formulation.
We intend to
complete a bridging pharmacokinetic phase 1 trial and a phase 2 proof-of-concept in PBC patients over approximately 12 months after aligning
with FDA on trial design. We believe the completed phase 1 data coupled with the ongoing phase 1 pharmacokinetic bridging study in
the United States may complement a phase 2a efficacy study to be launched next year in chronic pruritis in PBC as we begin engaging regulatory
authorities in both the US and the EU. The phase 2a trial is planned as a multiple ascending dose trial to assess the safety and tolerability
of TH104 and will also evaluate the change from baseline in the validated endpoint for pruritis studies, the Worst Itch-Numerical Rating
Scale (WI-NRS). Based on this data package, the Company expects to be able to initiate a registrational trial in 2025 pending an FDA
discussion on phase 2 results.
According
to the Centers for Disease control and Prevention Summary Health Statistics National Health Survey, more than 4 million patients suffer
from liver disease in US and about 1.7 million suffer from pruritis, where PBC has the highest rate of prevalence. We believe TH104
may also be used for treating chronic pruritogenic conditions associated with cholestatic liver disease as well as other liver related
and non-liver related diseases including fatty and alcoholic liver, non-alcoholic liver disease and certain types of hepatitis. Chronic
pruritis is significant in liver diseases (40% chronic pruritis; 1.7 million patients affected) as well as chronic kidney diseases (24%
chronic pruritis; 1.3 million patients affected) , hemodialysis as well as atopic dermatitis (40% pruritis; 2.7 million patients affected).
Furthermore,
we expect TH104 to be manufactured with a high speed of manufacturing with several features including very high content uniformity (95
– 105%), prepared using a single drop-on-a-disk or spray-on-disk method along with rapid solvent evaporation and low cost-of-goods.
We intend to be able to create a highly reproducible product using a small manufacturing footprint with few contract drug manufacturing
organizations in the marketplace which may allow limited entrants.
Competition
The
pharmaceutical and biotechnology industries are characterized by rapidly advancing technologies, intense competition, and a strong emphasis
on proprietary products and intellectual property. We face competition from major multinational pharmaceutical companies, established
biotechnology companies, specialty pharmaceutical companies, emerging and start-up companies, universities and other research institutions
both in the United States and internationally. Any drug candidates that we successfully develop and commercialize will compete with existing
therapies and new therapies that may become available in the future.
Many of our competitors
have significantly greater financial resources and expertise in research and development, manufacturing, pre-clinical testing,
conducting clinical trials, obtaining regulatory approvals and marketing approved products than we do. Mergers and acquisitions in
the pharmaceutical, biotechnology and diagnostic industries may result in even more resources being concentrated among a smaller
number of our competitors. These competitors also compete with us in recruiting and retaining qualified scientific and management
personnel and establishing clinical trial sites and patient registration for clinical trials, as well as in acquiring technologies
complementary to, or necessary for, our programs. Earlier stage companies, such as smaller discovery phase biotechnology companies,
may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies. We
anticipate some of our competitors for TH104 will include Mirum Pharma, Ipsen Pharma, Cara Therapeutics, Moonlake
Therapeutics, Apogee, and Regeneron. In addition, some of our competitors for our early-stage pipeline include Bayer AG, Moderna
Inc., Roche/Genentech, Daiichi Sankyo/Astra Zeneca, Merck, Bristol-Myers Squibb and Takeda Pharmaceutical Company.
Our
commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products that are more effective,
have fewer or less severe side effects, are more convenient or are less expensive than any products that we may develop. Our competitors
also may obtain FDA or other regulatory approval for their products more rapidly than we may obtain approval for ours. In addition, our
ability to compete may be affected in many cases by insurers or other third-party payers seeking to encourage the use of generic products.
Generic products are currently on the market, including the active ingredients which may be used for the indications that we are
pursuing, and additional products are expected to become available on a generic basis over the coming years. If our drug candidates achieve
marketing approval, we expect that they will be priced at a significant premium over competitive generic products.
The
most common methods of treating patients with cancer are surgery, radiation and drug therapy, including chemotherapy and targeted drug
therapy. There are a variety of available drug therapies marketed for solid tumors. In many cases, these drugs are administered in combination
to enhance efficacy. Some of these drugs are branded and subject to patent protection, and others are available on a generic basis, including
drugs in the same therapeutic class as the payloads in product candidates contained in our pipeline.
Many
of these approved drugs are well established therapies and are widely accepted by physicians, patients and third-party payers. In general,
although there has been considerable progress over the past few decades in the treatment of solid tumors and the currently marketed therapies
provide benefits to many patients, these therapies all are limited to some extent in their efficacy and frequency of adverse events,
and none of them are successful in treating all patients. As a result, the level of morbidity and mortality from solid tumor cancers
remains high.
There
are also a number of products in clinical development to treat solid tumors including, but not limited to, Loxo Oncology (LOXO-292),
Bristol-Myers Squibb (BMS-986016 and nivolumab) Mersana / GlaxoSmithKline (XMT-2056), Zymeworks (zenidatamab) and Eli Lilly & Co
(sintilimab) in addition to those products already on the market such as Merck & Co Inc. (Keytruda), Bristol-Myers Squibb Co. (Opdivo),
AbbVie Inc. (Imbruvica), Roche Group (Tecentiq), Regeneron Pharmaceuticals, Inc. (Libtayo). The products in development may provide efficacy,
safety, convenience and other benefits that are not provided by currently marketed therapies. As a result, they may provide significant
competition for our product candidates for which we obtain marketing approval.
Manufacturing
We
do not own or operate any facilities in which we can formulate or manufacture our product candidates. We intend to rely on contract manufacturers
to produce all materials required to conduct pre-clinical studies and clinical trials under cGMP”, with oversight of these activities
by our management team. We have identified alternate sources of supply and other contract manufacturers that can produce materials for
our pre-clinical and clinical trial requirements on a timely basis. However, if an existing or future contract manufacturer fails to
deliver on schedule, or at all, it may delay or interrupt the development process for our product candidates, which may have an
adverse effect on our operating results and estimated timelines.
Intellectual
Property
The
intellectual property that is available to us is important for our business, and we strive to protect it, including by obtaining, maintaining,
defending, and enforcing patent protection in the United States and internationally for our proprietary technology, improvements, platforms,
products and components thereof, novel biological discoveries, new therapeutic approaches and potential indications, and other inventions
that are important to our business. For our product candidates, generally we initially pursue patent protection covering compositions
of matter, methods of production, and methods of use. Throughout the development of our product candidates and technologies, we will
seek to identify additional means of obtaining patent protection.
Our patent portfolio includes 3 patent families with 2 issued U.S. patents and 14 pending applications related
generally to treatment of pruritis. The claims of these patents and applications cover devices and their method of manufacture, as well
as methods of treating. Specifically, our patent portfolio currently includes two issued U.S. patents, as well as a pending application
in the U.S. and 13 pending applications abroad. Patent protection is expected to expire in 2039, absent any applicable patent term adjustments
or extensions. We may file other patent applications in the future.
We also have
issued patents and pending applications related generally
to our polymeric nanoparticle technologies, methods of making our polymeric nanoparticle technologies, and methods of using our polymeric
nanoparticles therapeutically (e.g., for delivery of therapeutic compounds). Patent protection for the earliest-filed family is
expected to expire in 2033, absent any applicable patent term adjustments or extensions, with more recently filed families expiring approximately
between 2033 and 2042. We have collaborations with Minotaur Therapeutics, Inc. and Applied Biomedical Science Institute regarding
applications of this technology with a variety of multispecific binders including binders for HER2 and HER3, as well as an anti-PD-1
binder. These collaborations should lead to filing of additional patent applications in the future.
The
term of individual patents depends upon the legal term for patents in the countries in which they are obtained. In most countries, including
the U.S., the patent term is 20 years from the earliest filing date of a non-provisional patent application. In the U.S., the term of
a patent may be lengthened by patent term adjustment (“PTA”), which compensates a patentee for administrative delays by the
USPTO in examining and granting a patent or the term of a patent may be shortened if a patent is terminally disclaimed over an earlier
filed patent. The term of a patent that covers a drug or biological product may also be eligible for patent term extension (“PTE”)
after FDA approval for a portion of the term effectively lost as a result of the FDA regulatory review period, subject to certain limitations
and provided statutory and regulatory requirements are met. PTE can be for no more than five years, typically only one patent per approved
product can be extended, the extension cannot extend the total patent term beyond 14 years from approval, and only those claims covering
the approved drug, a method for using it or a method for manufacturing it may be extended. In addition, the length of the adjustment
or extension granted could be less than that requested, and we may not receive the full PTA or PTE available if we fail to exercise due
diligence during the testing phase or regulatory review process, fails to apply within applicable deadlines, fails to apply prior to
expiration of relevant patents, or otherwise fails to satisfy applicable requirements.
As
with many biotechnology and pharmaceutical companies, our ability to maintain and solidify our proprietary and intellectual property
position for our products will depend on our success in obtaining effective patent claims and enforcing those patent claims. However,
our owned pending patent applications, and any patent applications that may be filed in the future or licensed from third parties, may
not result in issuance. The breadth of claims that may be allowed or enforced in our patents also cannot be predicted. Any of our issued
patents or patents obtained in the future may be challenged, invalidated, infringed or circumvented. In addition, because of the extensive
time required for clinical development and regulatory review of a therapeutic product that may be developed, it is possible that, before
any of our products can be commercialized, any related patent may expire or remain in force for only a short period following commercialization,
thereby limiting the protection such patent would afford the respective product and any competitive advantage such patent may provide.
Further, the collaborations we have entered into may not result in patentable subject matter or potential licensing agreements may
not be successfully negotiated.
We intend
to file an intent-to-use U.S. trademark application for “THARIMMUNE INC” (for “Pharmaceutical preparations for use
in cancer treatment and therapies”) in International class 5.
Minotaur
Research and Collaboration Agreement and Taurus License Agreement
We
entered into a research collaboration and product license agreement with Minotaur Therapeutics, Inc. (“Minotaur”) and a commercial
license agreement with Taurus Biosciences, LLC (“Taurus”) for use of certain technology, including OmniAb antibodies, to
advance Picobodies against novel, unreachable and undruggable epitopes in high-value validated targets starting with PD-1. The research
and collaboration agreement and product license agreement are for the development of proprietary targeted biologics, including
TH1940, against PD-1.
The
research collaboration between our Company and Minotaur will be executed under the license from Taurus to discover, develop
and advance biotherapeutics against high-value validated IO targets. Picobodies are bovine-derived antibody “knob” domains
comprised of cysteine-rich ultralong complementary determining region H3 sequences of 30-40 amino acids weighing ~3-4KDa, which have
the potential to access challenging epitopes better than full size antibodies can.
By
combining non-proprietary half-life extending methods which are linked to a PD-1 Picobody™ to create TH1940,
we believe we could more efficiently target novel epitopes with greater binding affinity than approved anti-PD-1 antibodies. We further
believe that the development of TH1940 is a step toward enabling us to enter the rapidly growing immune-oncology market with additional
targets thereafter.
Applied
Biomedical Research Institute Option Agreement
On
July 5, 2023 (the “ABSI Effective Date”), we entered into a Research and Development Collaboration and License Agreement
(the “ABSI Agreement”) with Applied Biomedical Science Institute (“ABSI”) pursuant to which ABSI granted us an
exclusive royalty-bearing, sublicensable license to the ABSI Patents (as defined in the ABSI Agreement) and a non-exclusive, royalty-bearing,
sublicensable license to the ABSI Know-How (as defined in the ABSI Agreement) to Exploit (as defined in the ABSI Agreement) the ABSI
Products (as defined in the ABSI Agreement) for the treatment, diagnosis, prediction, detection or prevention of disease in humans and
animals worldwide (the “Territory”). Pursuant to the ABSI Agreement, the parties shall form a committee to manage the preclinical,
investigational new drug enabling studies and such other activities as shall lead to the initiation of a Phase 1 clinical trial of the
ABSI Product. The parties will collaborate on a Target-by-Target basis to identify and evaluate ABSI Products directed against such Target
with a view to identifying or generating suitable Products (as defined in the ABSI Agreement) for our Company to Exploit. “Target”
means ErB2 (Her2) and ErbB3. Upon completion of the Discovery Timeline (as defined in the ABSI Agreement) for a Target, subject to the
terms and conditions of ABSI Agreement, we shall exclusively own any ABSI Products against such Target. In the event the committee determines
that the discovery activities are unsuccessful with respect to a Target, we may propose an additional target, which, upon approval by
ABSI, shall replace a failed Target.
Government
Regulations
Governmental
authorities in the U.S. and other countries extensively regulate the research, development, testing, manufacture, labeling, promotion,
advertising, distribution and marketing of pharmaceutical products such as those being developed by us. In the U.S., the FDA regulates
such products under the FDCA and its implementing regulations. Failure to comply with applicable FDA requirements, both before and after
approval, may subject us to administrative and judicial sanctions, such as a delay in approving or refusal by the FDA to approve pending
applications, warning or untitled letters, product recalls, product seizures, total or partial suspension of production or distribution,
injunctions and/or criminal prosecution.
U.S.
Food and Drug Administration Regulation
United
States Drug Development
In
the United States, the FDA regulates drugs, medical devices and combinations of drugs and devices, or combination products, under the
FDCA and its implementing regulations. Drugs are also subject to other federal, state and local statutes and regulations. The process
of obtaining regulatory approvals and the subsequent compliance with appropriate federal, state, local and foreign statutes and regulations
requires the expenditure of substantial time and financial resources. Failure to comply with the applicable U.S. requirements at any
time during the product development process, approval process or after approval, may subject an applicant to administrative or judicial
sanctions. These sanctions could include, among other actions, the FDA’s refusal to approve pending applications, withdrawal of
an approval, a clinical hold, untitled or warning or untitled letters, requests for voluntary product recalls or withdrawals from the
market, product seizures, total or partial suspension of production or distribution injunctions, fines, refusals of government contracts,
restitution, disgorgement, or civil or criminal penalties. Any agency or judicial enforcement action could have a material adverse effect
on us.
The
process required by the FDA before a drug may be marketed in the United States generally involves the following:
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completion
of extensive pre-clinical laboratory tests, animal studies and formulation studies in accordance with applicable regulations, including
the FDA’s Good Laboratory Practice regulations; |
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submission
to the FDA of an IND, which must become effective before human clinical trials may begin; |
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performance
of adequate and well-controlled human clinical trials in accordance with an applicable IND and clinical study related regulations,
referred to as GCP, to establish the safety and efficacy of the proposed drug for its proposed indication; |
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submission
to the FDA of an NDA; |
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satisfactory
completion of an FDA pre-approval inspection of the manufacturing facility or facilities at which the product, or components thereof,
are produced to assess compliance with the FDA’s cGMP requirements; |
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potential
FDA audit of the clinical trial sites that generated the data in support of the NDA; and |
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FDA
review and approval of the NDA prior to any commercial marketing or sale. |
Once
a pharmaceutical product candidate is identified for development, it enters the pre-clinical testing stage. Pre-clinical tests include
laboratory evaluations of product chemistry, toxicity, formulation and stability, as well as animal studies. An IND sponsor must submit
the results of the pre-clinical tests, together with manufacturing information, analytical data and any available clinical data or literature,
to the FDA as part of the IND. The sponsor must also include a protocol detailing, among other things, the objectives of the initial
clinical trial, the parameters to be used in monitoring safety and the effectiveness criteria to be evaluated if the initial clinical
trial lends itself to an efficacy evaluation. Some pre-clinical testing may continue even after the IND is submitted. The IND automatically
becomes effective 30 days after receipt by the FDA, unless the FDA raises concerns or questions related to a proposed clinical trial
and places the trial on a clinical hold within that 30-day period. In such a case, the IND sponsor and the FDA must resolve any outstanding
concerns before the clinical trial can begin. Clinical holds also may be imposed by the FDA at any time before or during clinical trials
due to safety concerns or non-compliance and may be imposed on all drug products within a certain class of drugs. The FDA also can impose
partial clinical holds, for example, prohibiting the initiation of clinical trials of a certain duration or for a certain dose.
All
clinical trials must be conducted under the supervision of one or more qualified investigators in accordance with GCP regulations. These
regulations include the requirement that all research subjects provide informed consent in writing before their participation in any
clinical trial. Further, an IRB must review and approve the plan for any clinical trial before
it commences at any institution, and the IRB must conduct continuing review and reapprove the study at least annually. An IRB considers,
among other things, whether the risks to individuals participating in the clinical trial are minimized and are reasonable in relation
to anticipated benefits. The IRB also approves the information regarding the clinical trial and the consent form that must be provided
to each clinical trial subject or his or her legal representative and must monitor the clinical trial until completed.
Each
new clinical protocol and any amendments to the protocol must be submitted for FDA review, and to the IRBs for approval. Protocols detail,
among other things, the objectives of the clinical trial, dosing procedures, subject selection and exclusion criteria, and the parameters
to be used to monitor subject safety.
Human
clinical trials are typically conducted in three sequential phases that may overlap or be combined:
● |
Phase
1. The product is initially introduced into a small number of healthy human subjects or patients and tested for safety, dosage tolerance,
absorption, metabolism, distribution and excretion and, if possible, to gain early evidence on effectiveness. In the case of some
products for severe or life-threatening diseases, especially when the product is suspected or known to be unavoidably toxic, the
initial human testing may be conducted in patients. |
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Phase
2. Involves clinical trials in a limited patient population to identify possible adverse effects and safety risks, to preliminarily
evaluate the efficacy of the product for specific targeted diseases and to determine dosage tolerance and optimal dosage and schedule. |
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Phase
3. Clinical trials are undertaken to further evaluate dosage, clinical efficacy and safety in an expanded patient population at geographically
dispersed clinical trial sites. These clinical trials are intended to establish the overall risk/benefit relationship of the product
and provide an adequate basis for product labeling. |
Post-approval
trials, sometimes referred to as Phase 4 clinical trials, may be conducted after initial marketing approval. These studies are used to
gain additional experience from the treatment of patients in the intended therapeutic indication. In certain instances, the FDA may mandate
the performance of Phase 4 trials. Companies that conduct certain clinical trials also are required to register them and post the results
of completed clinical trials on a government-sponsored database, www.clinicaltrials.gov, in the United States, within certain
timeframes. Failure to do so can result in fines, adverse publicity and civil and criminal sanctions.
Progress
reports detailing the results of the clinical trials, among other information, must be submitted at least annually to the FDA, and written
IND safety reports must be submitted to the FDA and the investigators for serious and unexpected adverse events, findings from other
studies that suggest a significant risk to humans exposed to the product, findings from animal or in vitro testing that suggest a significant
risk to human subjects, and any clinically important increase in the rate of a serious suspected adverse reaction over that listed in
the protocol or investigator brochure. Phase 1, Phase 2 and Phase 3 clinical trials may not be completed successfully within any specified
period, if at all. The FDA or the clinical trial sponsor may suspend or terminate a clinical trial at any time on various grounds, including
a finding that the research subjects or patients are being exposed to an unacceptable health risk. Similarly, an IRB can suspend or terminate
approval of a clinical trial at its institution if the clinical trial is not being conducted in accordance with the IRB’s requirements
or if the product has been associated with unexpected serious harm to patients. Additionally, some clinical trials are overseen by an
independent group of qualified experts organized by the clinical trial sponsor, known as a data safety monitoring board or committee.
This group provides authorization for whether a trial may move forward at designated check points based on access to certain data from
the study. The clinical trial sponsor may also suspend or terminate a clinical trial based on evolving business objectives and/or competitive
climate.
Concurrent
with clinical trials, companies usually complete additional animal studies and must also develop additional information about the chemistry
and physical characteristics of the product and finalize a process for manufacturing the product in commercial quantities in accordance
with cGMP requirements. The manufacturing process must be capable of consistently producing quality batches of the product candidate
and, among other things, the manufacturer must develop methods for testing the identity, strength, quality and purity of the final product.
Additionally, appropriate packaging must be selected and tested and stability studies must be conducted to demonstrate that the product
candidate does not undergo unacceptable deterioration over its shelf life.
NDA
and FDA Review Process
The
results of product development, pre-clinical studies and clinical trials, along with descriptions of the manufacturing process, analytical
tests conducted on the drug, proposed labeling and other relevant information, are submitted to the FDA as part of an NDA, which request
approval to market a new drug product. The submission of an NDA is subject to the payment of a substantial user fee, and the sponsor
of an approved NDA is also subject to an annual program user fee; although a waiver of such fee may be obtained under certain limited
circumstances. For example, the agency will waive the application fee for the first human drug application that a small business or its
affiliate submits for review.
The
FDA reviews all NDAs submitted before it accepts them for filing and may request additional information rather than accepting an NDA
for filing. The FDA typically makes a decision on accepting an NDA for filing within 60 days of receipt. The decision to accept the NDA
for filing means that the FDA has made a threshold determination that the application is sufficiently complete to permit a substantive
review. Under the goals and policies agreed to by the FDA under the Prescription Drug User Fee Act (“PDUFA”), the FDA’s
goal to complete its substantive review of a standard NDA and respond to the applicant is ten months from the receipt of the NDA. The
FDA does not always meet its PDUFA goal dates, and the review process is often significantly extended by FDA requests for additional
information or clarification and may go through multiple review cycles.
After
the NDA submission is accepted for filing, the FDA reviews the NDA to determine, among other things, whether the proposed product is
safe and effective for its intended use, and whether the product is being manufactured in accordance with cGMP to assure and preserve
the product’s identity, strength, quality and purity. The FDA may refer applications for novel drug products or drug products that
present difficult questions of safety or efficacy to an advisory committee, typically a panel that includes clinicians and other experts,
for review, evaluation and a recommendation as to whether the application should be approved and under what conditions. The FDA is not
bound by the recommendations of an advisory committee, but it considers such recommendations carefully when making decisions. The FDA
will likely re-analyze the clinical trial data, which could result in extensive discussions between the FDA and us during the review
process. The review and evaluation of an NDA by the FDA is extensive and time consuming and may take longer than originally planned to
complete, and we may not receive a timely approval, if at all.
Before
approving an NDA, the FDA will conduct a pre-approval inspection of the manufacturing facilities for the new product to determine whether
they comply with cGMP. The FDA will not approve the product unless it determines that the manufacturing processes and facilities are
in compliance with cGMP requirements and adequate to assure consistent production of the product within required specifications. In addition,
before approving an NDA, the FDA may also audit data from clinical trials to ensure compliance with GCP requirements. After the FDA evaluates
the application, manufacturing process and manufacturing facilities, it may issue an approval letter or a Complete Response Letter. An
approval letter authorizes commercial marketing of the drug with specific prescribing information for specific indications. A Complete
Response Letter indicates that the review cycle of the application is complete and the application will not be approved in its present
form. A Complete Response Letter describes specific deficiencies in the NDA identified by the FDA. The Complete Response Letter may require
additional clinical data and/or an additional pivotal Phase 3 clinical trial(s), and/or other significant and time-consuming requirements
related to clinical trials, nonclinical studies or manufacturing. If a Complete Response Letter is issued, the applicant may either resubmit
the NDA, addressing all the deficiencies identified in the letter, or withdraw the application. Even if such data and information are
submitted, the FDA may ultimately decide that the NDA does not satisfy the criteria for approval. Data obtained from clinical trials
are not always conclusive, and the FDA may interpret data differently than we interpret the same data.
There
is no assurance that the FDA will ultimately approve a product for marketing in the United States, and we may encounter significant difficulties
or costs during the review process. If a product receives marketing approval, the approval may be significantly limited to specific diseases
and dosages or the indications for use may otherwise be limited, which could restrict the commercial value of the product. Further, the
FDA may require that certain contraindications, warnings or precautions be included in the product labeling or may condition the approval
of the NDA on other changes to the proposed labeling, development of adequate controls and specifications, or a commitment to conduct
post-market testing or clinical trials and surveillance to monitor the effects of approved products. For example, the FDA may require
Phase 4 clinical trials to further assess drug safety and effectiveness and may require testing and surveillance programs to monitor
the safety of approved products that have been commercialized. The FDA may also place other conditions on approvals, including the requirement
for a REMS to assure the safe use of the drug. If the FDA concludes a Risk Evaluation and Mitigation Strategy (“REMS”) is
needed, the sponsor of the NDA must submit a proposed REMS; the FDA will not approve the NDA without an approved REMS, if required. A
REMS could include medication guides, physician communication plans, or elements to assure safe use, such as restricted distribution
methods, patient registries and other risk minimization tools. Any of these limitations on approval or marketing could restrict the commercial
promotion, distribution, prescription or dispensing of products. Product approvals may be withdrawn for non-compliance with regulatory
requirements or if problems occur following initial marketing.
Orange
Book Listing and Paragraph IV Certification
For
NDA submissions, including those under Section 505(b)(2), applicants are required to list with the FDA certain patents with claims that
cover the applicant’s product. Upon approval, each of the patents listed in the application is published in Approved Drug Products
with Therapeutic Equivalence Evaluations, commonly referred to as the Orange Book. Any applicant who subsequently files an abbreviated
new drug application (“ANDA”) or 505(b)(2) NDA that references a drug listed in the Orange Book must certify to the FDA that
(1) no patent information on the drug product that is the subject of the application has been submitted to the FDA; (2) such patent has
expired; (3) the date on which such patent expires; or (4) such patent is invalid or will not be infringed upon by the manufacture, use
or sale of the drug product for which the application is submitted. This last certification is known as a Paragraph IV Certification.
If
an applicant has provided a Paragraph IV Certification to the FDA, the applicant must also send notice of the Paragraph IV Certification
to the holder of the NDA for the approved drug and the patent owner once the application has been accepted for filing by the FDA. The
NDA holder or patent owner may then initiate a patent infringement lawsuit in response to notice of the Paragraph IV Certification. The
filing of a patent infringement lawsuit within 45 days of the receipt of a Paragraph IV Certification prevents the FDA from approving
the ANDA or 505(b)(2) application until the earlier of 30 months from the date of the lawsuit, the applicant’s successful defense
of the suit, or expiration of the patent.
Reimbursement
Potential
sales of any of our product candidates, if approved, will depend, at least in part, on the extent to which such products will be covered
by third-party payors, such as government health care programs, commercial insurance and managed healthcare organizations. These third-party
payors are increasingly limiting coverage and/or reducing reimbursements for medical products and services. A third-party payor’s
decision to provide coverage for a drug product does not imply that an adequate reimbursement rate will be approved. Further, one payor’s
determination to provide coverage for a drug product does not assure that other payors will also provide coverage for the drug product.
In addition, the U.S. government, state legislatures and foreign governments have continued implementing cost-containment programs, including
price controls, restrictions on reimbursement and requirements for substitution of generic products. Adoption of price controls and cost-containment
measures, and adoption of more restrictive policies in jurisdictions with existing controls and measures, could further limit our future
revenues and results of operations. Decreases in third-party reimbursement or a decision by a third-party payor to not cover a product
candidate, if approved, or any future approved products could reduce physician usage of our products, and have a material adverse effect
on our sales, results of operations and financial condition.
In
the United States, the Medicare Part D program provides a voluntary outpatient drug benefit to Medicare beneficiaries for certain products.
We do not know whether our product candidates, if approved, will be eligible for coverage under Medicare Part D, but individual Medicare
Part D plans offer coverage subject to various factors such as those described above. Furthermore, private payors often follow Medicare
coverage policies and payment limitations in setting their own coverage policies.
Healthcare
Laws and Regulations
Sales
of our product candidates, if approved, or any other future product candidate will be subject to healthcare regulation and enforcement
by the federal government and the states and foreign governments in which we might conduct our business. The healthcare industry is highly
regulated under both state and federal laws and regulations. Our operations and relationships with healthcare plans and providers are
subject to extensive and increasing regulation by numerous federal, state, and local government agencies including the FDA, the Office
of Inspector General (“OIG”), the DOJ, the CMS, the Office of Civil Rights, and various state authorities.
The
healthcare laws and regulations that may affect our ability to operate include the following:
False
Claims Acts
We
will be subject to numerous federal and state laws that prohibit the presentation of false information, or the failure to disclose information,
in connection with the submission and payment of medical claims for reimbursement.
The
federal civil and criminal false claims laws and civil monetary penalties laws, such as the federal False Claims Act, 31 U.S.C. §§
3729-3733, impose civil liability on individuals or entities that submit false or fraudulent claims for payment to the federal government.
The False Claims Act provides, in part, that the federal government may bring a lawsuit against any person whom it believes has knowingly
or recklessly: presented, or caused to be presented, a false or fraudulent claim for payment or approval to the federal government; made,
used or caused to be made or used a false statement or a false record to get a claim for payment approved, including a false or fraudulent
claim; concealed, or knowingly and improperly avoided or decreased, an obligation to pay or transmit money or property to the federal
government; or conspired to commit any of the foregoing.
The
federal government has used the False Claims Act to prosecute a wide variety of alleged false claims and fraud allegedly perpetrated
against Medicare and state healthcare programs. The federal government, including as a result of the passage of the ACA, and a number
of courts have taken the position that claims presented in violation of certain other statutes, including the federal Anti-Kickback Statute
(“AKS”) or the federal physician referral law, 42 U.S.C. 1395nn (the “Stark Law”), can also be considered a violation
of the False Claims Act.
A
number of states have enacted laws that are similar to the federal False Claims Act. Under Section 6031 of the Deficit Reduction Act
of 2005, as amended, if a state enacts a false claims act that is at least as stringent as the federal statute and that also meets certain
other requirements, the state will be eligible to receive a greater share of any monetary recovery obtained pursuant to certain actions
brought under the state’s false claims act. As a result, many states have enacted laws that are similar to the federal False Claims
Act and there has been a concomitant increase in state false claims enforcement efforts. Violations of federal and state fraud and abuse
laws may be punishable by criminal and/or civil sanctions, including significant penalties, fines, disgorgement, additional reporting
requirements and oversight under a corporate integrity agreement or similar agreement to resolve allegations of noncompliance with these
laws, and/or exclusion or suspension from federal healthcare programs, such as Medicare, and debarment from contracting with the U.S.
government. Penalties for False Claims Act violations include fines ranging from $13,508 to $27,018 for each false claim adjusted each
year for inflation, plus up to three times the amount of damages sustained by the government. In addition to the provisions of the False
Claims Act, which provide for civil enforcement, the federal government also can use several criminal statutes to prosecute persons who
are alleged to have submitted false or fraudulent claims to the government for payments. Additionally, private parties may initiate qui
tam whistleblower lawsuits against any person or entity under the False Claims Act in the name of the federal government, as well
as under the false claims laws of several states, and may share in the proceeds of a successful suit. Generally, federal and state governments
have made investigating and prosecuting healthcare fraud and abuse a priority.
The
Federal “Stark” Law
The
Federal Stark Law (42 U.S.C. § 1395nn) prohibits referrals or ordering by a physician of “designated health services,”
which include pharmaceuticals and drugs that are payable, in whole or in part, by Medicare or Medicaid, to an entity in which the physician
or the physician’s immediate family member has an investment interest or other financial relationship, subject to several exceptions.
Financial relationships that are implicated by the Stark Law can include arrangements ranging from marketing arrangements and consulting
agreements to medical director agreements with physicians who order our products. The Stark Law also prohibits billing for services rendered
pursuant to a prohibited referral. Several states have enacted laws similar to the Stark Law. These state laws may cover all (not just
Medicare and Medicaid) patients. Many federal healthcare reform proposals in the past few years have attempted to expand the Stark Law
to cover all patients as well. If we violate the Stark Law, our financial results and operations could be adversely affected. Penalties
for violations include denial of payment for the services, significant civil monetary penalties, and exclusion from the Medicare and
Medicaid programs.
Federal
and State Anti-Kickback Statutes
The
AKS, set forth in Section 1128B of the Social Security Act, prohibits the knowing and willful offer, payment, solicitation or receipt
of any form of remuneration in return for, or to induce, (i) the referral of a person for items or services reimbursable under federal
healthcare programs, (ii) the furnishing or arranging for the furnishing of items or services reimbursable under federal healthcare programs
or (iii) the purchase, lease or order or arranging or recommending purchasing, leasing or ordering of any item or service reimbursable
under federal healthcare programs.
The
core of a violation of the AKS is an “inducement” to refer patients for services or items that are reimbursed under a federal
healthcare program, such as Medicare, Medicaid, or Tricare (which covers military personnel). The ACA amended the AKS to make it clear
that a person need not have actual knowledge of the statute, or specific intent to violate the statute, as a predicate for a violation.
Court cases have resulted in the interpretation that a violation may occur where even one purpose of the remuneration is to induce or
reward referrals, and the OIG, which has the authority to impose administrative sanctions for violation of the statute, has adopted a
similar standard.
There
are certain AKS “safe harbors” which, if the respective requirements are met, would afford protection from the AKS. Failure
to meet all requirements of an AKS safe harbor does not necessarily mean the arrangement violates the AKS, but it may be subject to scrutiny
by legal authorities, in light of the parties’ intent and arrangements. In other words, if an arrangement does not fit within a
safe harbor, it does not necessarily mean that the arrangement is per se illegal-only that it is not shielded from regulatory
scrutiny. The federal AKS provides criminal penalties for individuals or entities that knowingly and willfully solicit or receive any
remuneration. A violation of the AKS is punishable by imprisonment of up to ten years, fines of up to $100,000 per offense, or both.
Violation can also give rise to federal healthcare program exclusion, liability under the False Claims Act and civil penalties, which
may include monetary penalties of up to $100,000 per offense, repayments of up to three times the total payments between the parties
to the arrangement and suspension from future participation in Medicare and Medicaid.
Additionally,
some states have enacted statutes and regulations similar to the AKS, but which may be applicable regardless of the payor source for
the patient. These state laws may contain exceptions and safe harbors that are different from and/or more limited than those of federal
law and that may vary from state to state.
Health
Care Fraud Statute
The
Health Care Fraud Statute, 18 U.S.C. § 1347, prohibits any person from knowingly and willfully executing, or attempting to execute,
a scheme to defraud any healthcare benefit program, which can be either a government or private payor plan. Violation of this statute,
even in the absence of actual knowledge of or specific intent to violate the statute, may be charged as a felony offense and may result
in fines, imprisonment or both. The Health Care False Statement Statute, 18 U.S.C. § 1035, prohibits, in any matter involving a
federal healthcare program, anyone from knowingly and willfully falsifying, concealing or covering up, by any trick, scheme or device,
a material fact, or making any materially false, fictitious, or fraudulent statement or representation, or making or using any materially
false writing or document knowing that it contains a materially false or fraudulent statement. A violation of this statute may be charged
as a felony offense and may result in fines, imprisonment, or both.
Civil
Monetary Penalties Statute
The
CMPL, 42 U.S.C. § 1320a-7a, authorizes the imposition of civil monetary penalties, assessments, and exclusions against an individual
or entity based on a variety of prohibited conduct, including, but not limited to: (i) presenting, or causing to be presented, claims
for payment to Medicare, Medicaid, or other third-party payors that the individual or entity knows or should know are for an item or
service that was not provided as claimed or is false or fraudulent; (ii) offering remuneration to a federal healthcare program beneficiary
that the individual or entity knows or should know is likely to influence the beneficiary to order or receive healthcare items or services
from a particular provider; (iii) arranging contracts with an entity or individual excluded from participation in a federal healthcare
program; (iv) violating the federal AKS; (v) making, using, or causing to be made or used, a false record or statement material to a
false or fraudulent claim for payment for items and services furnished under a federal healthcare program; (vi) making, using, or causing
to be made any false statement, omission, or misrepresentation of a material fact in any application, bid, or contract to participate
or enroll as a provider of services or a supplier under a federal healthcare program; and (vii) failing to report and return an overpayment
owed to the federal government. We could be exposed to a wide range of allegations to which the federal CMPL would apply. We cannot foreclose
the possibility that we will face allegations subject to the CMPL with the potential for a material adverse impact on our business, results
of operations and financial condition. Substantial civil monetary penalties may be imposed under the federal Civil Monetary Penalty Statute
and may vary, depending on the underlying violation. In addition, an assessment of not more than three times the total amount claimed
for each item or service may also apply, and a violator may be subject to exclusion from federal and state healthcare programs.
Additionally,
to the extent that our product is sold in a foreign country, we may be subject to similar foreign laws.
Employees
As
of September 30, 2023, we employed 2 full-time employees and 1 part-time employee. We are not a party to any collective
bargaining agreements, and we believe that we maintain good relations with our employees.
Facilities
Our
corporate headquarters are located at 1200 Route 22 East, Suite 2000, Bridgewater, NJ 08807 pursuant to a monthly rental agreement. We
believe this to be sufficient to meet our needs for the foreseeable future and that any additional space we may require will be available
on commercially reasonable terms.
Legal
Proceedings
From
time to time, we may become involved in various lawsuits and legal proceedings, which arise in the ordinary course of business. Litigation
is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business.
We are currently not aware of any such legal proceedings or claims that will have, individually or in the aggregate, a material adverse
effect on our business, financial condition or operating results.
Our
Corporate History
Hillstream
BioPharma Inc. (“HBI”) was incorporated on March 28, 2017, as a Delaware C-corporation. On July 16, 2019, Hillstream BioPharma
Holdings, Inc. (“Holdco”) was formed as a Delaware C-corporation. On July 24, 2019, Holdco entered into a Contribution and
Exchange Agreement with Nanoproteagen LLC (“Nanoproteagen”) whereby the members of Nanoproteagen exchanged 100% of their
membership interests in Nanoproteagen for shares of Holdco common stock. Also on July 24, 2019, the stockholders of HBI exchanged 100%
of their shares of common stock for shares of common stock of Holdco. HBI and Nanoproteagen became wholly-owned subsidiaries of Holdco.
On August 7, 2019, pursuant to a certificate of amendment, Holdco’s name was changed to Hillstream BioPharma, Inc. and HBI’s
name was changed to HB Pharma Corp. On November 12, 2020, Hillstream BioPharma, Inc. entered into a Share Exchange Agreement with Farrington
Therapeutics LLC (“Farrington”), whereby the members of Farrington exchanged their membership interest in Farrington for
shares of common stock of Hillstream BioPharma, Inc., and Farrington became a wholly-owned subsidiary of Hillstream BioPharma, Inc. On
September 21, 2023, the Company filed a Certificate of Amendment to its Certificate of Incorporation with the Secretary of State of the
State of Delaware pursuant to which it changed its name to Tharimmune, Inc. effective as of September 25, 2023. At June 30, 2023, the
Company had one wholly-owned subsidiary, HB Pharma Corp.
DESCRIPTION
OF SECURITIES WE ARE OFFERING
Common
Stock
We
are authorized to issue up to a total of 250,000,000 shares of common stock, par value $0.0001 per share. Holders of our common stock
are entitled to one vote for each share held on all matters submitted to a vote of our stockholders. Holders of our common stock have
no cumulative voting rights. All shares of common stock offered hereby will, when issued, be fully paid and nonassessable, including
shares of common stock issued upon the exercise of common stock warrants or subscription rights, if any.
Further,
holders of our common stock have no preemptive or conversion rights or other subscription rights. Upon our liquidation, dissolution or
winding-up, holders of our common stock are entitled to share in all assets remaining after payment of all liabilities and the liquidation
preferences of any of our outstanding shares of preferred stock. Subject to preferences that may be applicable to any outstanding shares
of preferred stock, holders of our common stock are entitled to receive dividends, if any, as may be declared from time to time by our
Board of Directors out of our assets which are legally available.
The
holders of a majority of the shares of our capital stock, represented in person or by proxy, are necessary to constitute a quorum for
the transaction of business at any meeting. If a quorum is present, an action by stockholders entitled to vote on a matter is approved
if the number of votes cast in favor of the action exceeds the number of votes cast in opposition to the action, with the exception of
the election of directors, which requires a plurality of the votes cast.
Pre-Funded
Warrants
The
following is a brief summary of certain terms and conditions of the Pre-funded Warrants being offered in this offering. The following
description is subject in all respects to the provisions contained in the Pre-funded Warrants, a form of which is an exhibit to this
Registration Statement.
Form
The
Pre-funded Warrants will be issued as individual warrant agreements to the purchasers.
Term
The
Pre-funded Warrants will not expire until they are fully exercised.
Exercisability
The
Pre-funded Warrants are exercisable at any time until they are fully exercised. The Pre-funded Warrants will be exercisable, at the option
of each holder, in whole or in part by delivering to us a duly executed exercise notice and payment of the exercise price. No fractional
shares of common stock will be issued in connection with the exercise of a Pre-funded Warrant. The holder of the Pre-funded Warrant may
also satisfy its obligation to pay the exercise price through a “cashless exercise,” in which the holder receives the net
value of the Pre-funded Warrants in shares of common stock determined according to the formula set forth in the Pre-funded Warrant.
Exercise
Limitations
Under
the terms of the Pre-funded Warrants, we may not effect the exercise of any such warrant, and a holder will not be entitled to exercise
any portion of any such warrant, if, upon giving effect to such exercise, the aggregate number of shares of common stock beneficially
owned by the holder (together with its affiliates, any other persons acting as a group together with the holder or any of the holder’s
affiliates, and any other persons whose beneficial ownership of common stock would or could be aggregated with the holder’s for
purposes of Section 13(d) or Section 16 of the Exchange Act) would exceed 4.99% of the number of shares of common stock outstanding immediately
after giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of such warrant, which percentage
may be increased or decreased at the holder’s election upon 61 days’ notice to us subject to the terms of such warrants,
provided that such percentage may in no event exceed 9.99%.
Exercise
Price
The
exercise price of our shares of common stock purchasable upon the exercise of the Pre-funded Warrants is $0.001 per share. The exercise
price of the Pre-funded Warrants and the number of shares of common stock issuable upon exercise of the Pre-funded Warrants is subject
to appropriate adjustment in the event of certain stock dividends and distributions, stock splits, stock combinations, reclassifications
or similar events affecting our shares of common stock, as well as upon any distribution of assets, including cash, stock or other property,
to our stockholders.
Transferability
Subject
to applicable laws, the Pre-funded Warrants may be offered for sale, sold, transferred or assigned without our consent.
Exchange
Listing
We
do not intend to list the Pre-funded Warrants on The Nasdaq Capital Market, any other national securities exchange or any other nationally
recognized trading system.
Fundamental
Transactions
Upon
the consummation of a fundamental transaction (as described in the Pre-funded Warrants, and generally including any reorganization, recapitalization
or reclassification of our shares of common stock, the sale, transfer or other disposition of all or substantially all of our properties
or assets, our consolidation or merger with or into another person, the acquisition of more than 50% of our outstanding shares of common
stock, or any person or group becoming the beneficial owner of 50% of the voting power of our outstanding shares of common stock), the
holders of the Pre-funded Warrants will be entitled to receive, upon exercise of the Pre-funded Warrants, the kind and amount of securities,
cash or other property that such holders would have received had they exercised the Pre-funded Warrants immediately prior to such fundamental
transaction, without regard to any limitations on exercise contained in the Pre-funded Warrants. Notwithstanding the foregoing, in the
event of a fundamental transaction where the consideration consists solely of cash, solely of marketable securities or a combination
of cash and marketable securities, then each Pre-funded Warrant shall automatically be deemed to be exercised in full in a cashless exercise
effective immediately prior to and contingent upon the consummation of such fundamental transaction.
No
Rights as a Stockholder
Except
by virtue of such holder’s ownership of shares of common stock, the holder of a Pre-funded Warrant does not have the rights or
privileges of a holder of our shares of common stock, including any voting rights, until such holder exercises the Pre-funded Warrant.
Anti-Takeover
Effects of Certain Provisions of our Certificate of Incorporation, Bylaws and the DGCL
We
are governed by the provisions of Section 203 of the Delaware General Corporation Law (the “DGCL”). In general, Section 203
prohibits a publicly traded Delaware corporation from engaging in a business combination with an interested stockholder for a period
of three years after the date of the transaction in which the person became an interested stockholder, unless the business combination
is approved in a prescribed manner. A business combination includes mergers, asset sales or other transactions resulting in a financial
benefit to the stockholder. An interested stockholder is a person who, together with affiliates and associates, owns (or within three
years, did own) 15% or more of the corporation’s voting stock, subject to certain exceptions. The statute could have the effect
of delaying, deferring or preventing a change in control of our Company.
Our
Certificate of Incorporation and Bylaws contain provisions that could have the effect of discouraging potential acquisition proposals
or making a tender offer or delaying or preventing a change in control, including changes a stockholder might consider favorable. In
particular, our Certificate of Incorporation and Bylaws, as applicable, among other things:
|
● |
provide
our Board of Directors with the ability to alter our bylaws without stockholder approval; |
|
● |
provide
that vacancies on our Board of Directors may be filled by a majority of directors in office, although less than a quorum; |
|
● |
provide
that special meetings of our stockholders may be called by our Board of Directors, our Chief Executive Officer, or our President
(in the absence of a Chief Executive Officer), the Chairman of our Board of Directors or stockholders entitled to cast at least one-fifth
of the votes which all stockholders are entitled to cast at the particular meeting; and |
|
● |
provide
advance notice requires for stockholders seeking to bring business before our annual meeting of stockholders, or to nominate candidates
for election as directors at our annual meeting of stockholders. |
Such
provisions may have the effect of discouraging a third-party from acquiring us, even if doing so would be beneficial to our stockholders.
These provisions are intended to enhance the likelihood of continuity and stability in the composition of our Board of Directors and
in the policies formulated by them, and to discourage some types of transactions that may involve an actual or threatened change in control
of our Company. These provisions are designed to reduce our vulnerability to an unsolicited acquisition proposal and to discourage some
tactics that may be used in proxy fights. We believe that the benefits of increased protection of our potential ability to negotiate
with the proponent of an unfriendly or unsolicited proposal to acquire or restructure our Company outweigh the disadvantages of discouraging
such proposals because, among other things, negotiation of such proposals could result in an improvement of their terms.
However,
these provisions could have the effect of discouraging others from making tender offers for our shares that could result from actual
or rumored takeover attempts. These provisions also may have the effect of preventing changes in our management.
Listing
Our
common stock is listed on The Nasdaq Capital Market under the trading symbol “THAR”.
Transfer
Agent and Registrar
The
Transfer Agent and Registrar for our common stock is Pacific Stock Transfer Company, 6725 Via Austi Parkway, Suite 300, Las Vegas, Nevada
89119.
UNDERWRITING
ThinkEquity
LLC is acting as representative of the underwriters of this offering. We have entered into an underwriting agreement dated , 2023 with
the representative. Subject to the terms and conditions of the underwriting agreement, we have agreed to sell to each underwriter named
below, and each underwriter named below has severally agreed to purchase, at the public offering price less the underwriting discounts
set forth on the cover page of this prospectus, the number of securities next to its name in the following table:
Underwriter |
|
Number of
Shares |
|
|
Number of Pre-Funded
Warrants |
|
ThinkEquity LLC |
|
|
|
|
|
|
|
|
Total |
|
|
|
|
|
|
|
|
The underwriting agreement
provides that the obligations of the underwriters to pay for and accept delivery of the shares of common stock and/or Pre-funded
Warrants offered by this prospectus are subject to various conditions and representations and warranties, including the approval of certain
legal matters by their counsel and other conditions specified in the underwriting agreement. The shares of common stock and/or Pre-funded
Warrants are offered by the underwriters, subject to prior sale, when, as and if issued to and accepted by them. The underwriters
reserve the right to withdraw, cancel or modify the offer to the public and to reject orders in whole or in part. The underwriters are
obligated to take and pay for all of the shares of common stock and/or Pre-funded Warrants offered by this prospectus if any such
shares of common stock and/or Pre-Funded Warrants are taken, other than those shares of common stock and/or Pre-funded Warrants
covered by the over-allotment option described below.
We
have agreed to indemnify the underwriters against specified liabilities, including liabilities under the Securities Act, and to contribute
to payments the underwriters may be required to make in respect thereof.
Over-Allotment
Option
We
have granted a 45-day option to the representative of the underwriters to purchase up to additional
shares of our common stock and/or Pre-funded Warrants at a public offering price of $ per share
(or $ per Pre-funded Warrant), solely to cover over-allotments, if any. The underwriters
may exercise this option for 45 days from the closing date of this offering solely to cover sales of shares of common stock and/or Pre-funded
Warrants by the underwriters in excess of the total number of shares of common stock and/or Pre-funded Warrants set forth
in the table above. If any of these additional shares are purchased, the underwriters will offer the additional shares and/or Pre-funded
Warrants on the same terms as those on which the shares are being offered.
Discount
The
underwriters propose initially to offer the shares of common stock and/or Pre-funded Warrants to the public at the public offering
price set forth on the cover page of this prospectus and to dealers at that price less a concession not in excess of $
per share of common stock and $ per Pre-funded Warrant. If all of the shares of common stock
and/or Pre-funded Warrants offered by us are not sold at the public offering price, the underwriters may change the offering price
and other selling terms by means of a supplement to this prospectus.
The
following table shows the offering price, underwriting discounts and proceeds, before expenses, to us. The information assumes either
no exercise or full exercise by the underwriters of their over-allotment option.
|
|
Per Share |
|
|
Per
Pre-funded
Warrant |
|
|
Total Without
Over- Allotment
Option |
|
|
Total With
Over- Allotment
Option |
|
Offering price |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
Underwriting discount and commissions (7%) |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
Proceeds, before expense, to us |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
We
have agreed to pay a non-accountable expense allowance to the underwriters equal to 1% of the gross proceeds received in this offering
(excluding proceeds received from exercise of the underwriters’ over-allotment option).
We
have paid an expense deposit of $25,000 to the representative, which will be applied against the out-of-pocket accountable
expenses that will be paid by us to the underwriters in connection with this offering, and will be reimbursed to us to the extent not
actually incurred in compliance with FINRA Rule 5110(g)(4)(A).
We
have also agreed to pay certain of the representative’s expenses relating to the offering, including: (a) all fees, expenses and
disbursements relating to background checks of our officers, directors and entities in an amount not to exceed $15,000 in the aggregate;
(b) fees and expenses of the underwriter’s legal counsel not to exceed $100,000; (c) a $29,500 cost associated with the underwriters
use of Ipreo’s book-building, prospectus tracking and compliance software for the offering; (d) $10,000 for data services and communications
expenses; (e) up to $30,000 of market making and trading, and clearing firm settlement expenses for the offering; (f) up to $10,000 of
the underwriters’ actual accountable “road show” expenses; and (g) up to $3,000 associated with bound volumes of the
public offering materials as well as commemorative mementos and lucite tombstones.
Our
total estimated expenses of the offering, including registration, filing and listing fees, printing fees and legal and accounting expenses,
but excluding underwriting discounts and commissions and excluding the non-accountable expense allowance, are approximately $ .
Representative’s
Warrants
Upon
closing of this offering, we have agreed to issue the representative warrants (the “Representative’s Warrants”) as
compensation to purchase up to shares of common stock (3% of the aggregate
number of shares of common stock and/or Pre-funded Warrants sold in this offering). The Representative’s Warrants will be
exercisable at a per share exercise price equal to 125% of the public offering price per share in this offering. The Representative’s
Warrants are exercisable at any time and from time to time, in whole or in part, during the four and one half year period commencing
180 days from the commencement of sales of the shares of common stock in this offering.
In
addition, the warrants provide for registration rights upon request, in certain cases. The sole demand registration right provided will
not be greater than five years from the date of the Underwriting Agreement in compliance with FINRA Rule 5110(g)(8)(C). The piggyback
registration rights provided will not be greater than two years from the initial exercise date of the Representative’s Warrants
in compliance with FINRA Rule 5110(g)(8)(D). We will bear all fees and expenses attendant to registering the securities issuable on exercise
of the warrants other than underwriting commissions incurred and payable by the holders. The exercise price and number of shares issuable
upon exercise of the warrants may be adjusted in certain circumstances including in the event of a stock dividend or our recapitalization,
reorganization, merger or consolidation. However, the warrant exercise price or underlying shares will not be adjusted for issuances
of shares of common stock at a price below the warrant exercise price.
Lock-Up
Agreements
Pursuant
to “lock-up” agreements, we, and our executive officers and directors have agreed,
without the prior written consent of the representative, not to, directly or indirectly, offer to sell, sell, pledge or otherwise transfer
or dispose of any of shares of (or enter into any transaction or device that is designed to, or could be expected to, result in the transfer
or disposition by any person at any time in the future of) our common stock, enter into any swap or other derivatives transaction that
transfers to another, in whole or in part, any of the economic benefits or risks of ownership of shares of our common stock, make any
demand for or exercise any right or cause to be filed a registration statement, including any amendments thereto, with respect to the
registration of any shares of common stock or securities convertible into or exercisable or exchangeable for shares of common stock or
any other of our securities or publicly disclose the intention to do any of the foregoing, subject to customary exceptions, for, with
respect to the Company, a period of 90 days from the date of this prospectus, and with respect to our executive
officers and directors, a period of 180 days from the date of this prospectus.
Right
of First Refusal
We
have granted the representative a right of first refusal, for a period of three months from the closing of the offering, to act as sole
investment banker, sole book-runner, and/or sole placement agent, at the representative’s sole and exclusive discretion, for each
and every future public and private equity and debt offering, including all of our equity linked financings (each, a “Subject Transaction”),
or any successor (or any of our subsidiaries), on terms and conditions customary to the representative for such Subject Transactions.
Prior
Relationships
ThinkEquity LLC acted as the representative of
the underwriters for a public offering that closed May 2, 2023. ThinkEquity LLC received a commission equal to 7% of the gross proceeds
of the public offering, a 1% non-accountable expense allowance and warrants to purchase up to 3% of the number of shares of common stock
or pre-funded warrants sold in that offering. In addition, we granted ThinkEquity LLC an irrevocable right of first refusal similar to
that described above for a period of three months from the closing of that offering.
Discretionary
Accounts
The
underwriters do not intend to confirm sales of the shares of common stock and/or Pre-funded Warrants offered hereby to any accounts
over which they have discretionary authority.
Nasdaq
Capital Market Listing
Our
common stock is listed on The Nasdaq Capital Market under the symbol “THAR”. There is no established trading market for the
Pre-funded Warrants and we do not intend to list the Pre-funded Warrants on any securities exchange or nationally recognized
trading system.
Other
From
time to time, certain of the underwriters and/or their affiliates may in the future provide, various investment banking and other financial
services for us for which they may receive customary fees. In the course of their businesses, the underwriters and their affiliates may
actively trade our securities or loans for their own account or for the accounts of customers, and, accordingly, the underwriters and
their affiliates may at any time hold long or short positions in such securities or loans.
Except
for services provided in connection with this offering and the public offering of securities which closed on May 2, 2023 described
above, no underwriter has provided any investment banking or other financial services to us during the 180-day period preceding the
date of this prospectus. See the section titled “Prior Relationships” above.
Price
Stabilization, Short Positions and Penalty Bids
In
connection with this offering, the underwriters may engage in transactions that stabilize, maintain or otherwise affect the price of
our common stock. Specifically, the underwriters may over-allot in connection with this offering by selling more shares than are set
forth on the cover page of this prospectus. This creates a short position in our common stock for its own account. The short position
may be either a covered short position or a naked short position. In a covered short position, the number of shares of common stock over-allotted
by the underwriters is not greater than the number of shares of common stock that they may purchase in the over-allotment option. In
a naked short position, the number of shares of common stock involved is greater than the number of shares common stock in the over-allotment
option. To close out a short position, the underwriters may elect to exercise all or part of the over-allotment option. The underwriters
may also elect to stabilize the price of our common stock or reduce any short position by bidding for, and purchasing, common stock in
the open market.
The
underwriters may also impose a penalty bid. This occurs when a particular underwriter or dealer repays selling concessions allowed to
it for distributing shares of common stock in this offering because the underwriter repurchases the shares of common stock in stabilizing
or short covering transactions.
Finally,
the underwriters may bid for, and purchase, shares of our common stock in market making transactions, including “passive”
market making transactions as described below.
These
activities may stabilize or maintain the market price of our common stock at a price that is higher than the price that might otherwise
exist in the absence of these activities. The underwriters are not required to engage in these activities, and may discontinue any of
these activities at any time without notice. These transactions may be effected on the national securities exchange on which our shares
of common stock are traded, in the over-the-counter market, or otherwise.
Indemnification
We
have agreed to indemnify the underwriters against liabilities relating to this offering arising under the Securities Act and the Exchange
Act, liabilities arising from breaches of some, or all of the representations and warranties contained in the underwriting agreement,
and to contribute to payments that the underwriters may be required to make for these liabilities.
Electronic
Distribution
This
prospectus in electronic format may be made available on websites or through other online services maintained by one or more of the underwriters,
or by their affiliates. Other than this prospectus in electronic format, the information on any underwriter’s website and any information
contained in any other website maintained by an underwriter is not part of this prospectus, has not been approved and/or endorsed by
us or any underwriter in its capacity as underwriter, and should not be relied upon by investors.
Offer
restrictions outside the United States
Other
than in the United States, no action has been taken by us or the underwriters that would permit a public offering of the securities offered
by this prospectus in any jurisdiction where action for that purpose is required. The securities offered by this prospectus may not be
offered or sold, directly or indirectly, nor may this prospectus or any other offering material or advertisements in connection with
the offer and sale of any such securities be distributed or published in any jurisdiction, except under circumstances that will result
in compliance with the applicable rules and regulations of that jurisdiction. Persons into whose possession this prospectus comes are
advised to inform themselves about and to observe any restrictions relating to the offering and the distribution of this prospectus.
This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any securities offered by this prospectus in
any jurisdiction in which such an offer or a solicitation is unlawful.
Australia
This
prospectus is not a disclosure document under Chapter 6D of the Australian Corporations Act, has not been lodged with the Australian
Securities and Investments Commission and does not purport to include the information required of a disclosure document under Chapter
6D of the Australian Corporations Act. Accordingly, (i) the offer of the securities under this prospectus is only made to persons to
whom it is lawful to offer the securities without disclosure under Chapter 6D of the Australian Corporations Act under one or more exemptions
set out in section 708 of the Australian Corporations Act, (ii) this prospectus s made available in Australia only to those persons as
set forth in clause (i) above, and (iii) the offeree must be sent a notice stating in substance that by accepting this offer, the offeree
represents that the offeree is such a person as set forth in clause (i) above, and, unless permitted under the Australian Corporations
Act, agrees not to sell or offer for sale within Australia any of the securities sold to the offeree within 12 months after its transfer
to the offeree under this prospectus.
Canada
The
securities may be sold only to purchasers purchasing, or deemed to be purchasing, as principal that are accredited investors, as defined
in National Instrument 45-106 Prospectus Exemptions or subsection 73.3(1) of the Securities Act (Ontario), and are permitted clients,
as defined in National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations. Any resale of the
securities must be made in accordance with an exemption from, or in a transaction not subject to, the prospectus requirements of applicable
securities laws.
Securities
legislation in certain provinces or territories of Canada may provide a purchaser with remedies for rescission or damages if this prospectus
(including any amendment thereto) contains a misrepresentation, provided that the remedies for rescission or damages are exercised by
the purchaser within the time limit prescribed by the securities legislation of the purchaser’s province or territory. The purchaser
should refer to any applicable provisions of the securities legislation of the purchaser’s province or territory for particulars
of these rights or consult with a legal advisor.
China
The
information in this document does not constitute a public offer of the securities, whether by way of sale or subscription, in the People’s
Republic of China (excluding, for purposes of this paragraph, Hong Kong Special Administrative Region, Macau Special Administrative Region
and Taiwan). The securities may not be offered or sold directly or indirectly in the PRC to legal or natural persons other than directly
to “qualified domestic institutional investors.”
European
Economic Area—Belgium, Germany, Luxembourg and Netherlands
The
information in this document has been prepared on the basis that all offers of securities will be made pursuant to an exemption under
the Directive 2003/71/EC (“Prospectus Directive”), as implemented in Member States of the European Economic Area (each, a
“Relevant Member State”), from the requirement to produce a prospectus for offers of securities.
An
offer to the public of securities has not been made, and may not be made, in a Relevant Member State except pursuant to one of the following
exemptions under the Prospectus Directive as implemented in that Relevant Member State:
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to
legal entities that are authorized or regulated to operate in the financial markets or, if not so authorized or regulated, whose
corporate purpose is solely to invest in securities; |
|
|
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to
any legal entity that has two or more of (i) an average of at least 250 employees during its last fiscal year; (ii) a total balance
sheet of more than €43,000,000 (as shown on its last annual unconsolidated or consolidated financial statements) and (iii) an
annual net turnover of more than €50,000,000 (as shown on its last annual unconsolidated or consolidated financial statements); |
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to
fewer than 100 natural or legal persons (other than qualified investors within the meaning of Article 2(1)(e) of the Prospectus Directive)
subject to obtaining the prior consent of the Company or any underwriter for any such offer; or |
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in
any other circumstances falling within Article 3(2) of the Prospectus Directive, provided that no such offer of securities shall
result in a requirement for the publication by the Company of a prospectus pursuant to Article 3 of the Prospectus Directive. |
France
This
document is not being distributed in the context of a public offering of financial securities (offre au public de titres financiers)
in France within the meaning of Article L.411-1 of the French Monetary and Financial Code (Code Monétaire et Financier) and Articles
211-1 et seq. of the General Regulation of the French Autorité des marchés financiers (“AMF”). The securities
have not been offered or sold and will not be offered or sold, directly or indirectly, to the public in France.
This
document and any other offering material relating to the securities have not been, and will not be, submitted to the AMF for approval
in France and, accordingly, may not be distributed or caused to distributed, directly or indirectly, to the public in France.
Such
offers, sales and distributions have been and shall only be made in France to (i) qualified investors (investisseurs qualifiés)
acting for their own account, as defined in and in accordance with Articles L.411-2-II-2° and D.411-1 to D.411-3, D.744-1, D.754-1
;and D.764-1 of the French Monetary and Financial Code and any implementing regulation and/or (ii) a restricted number of non-qualified
investors (cercle restreint d’investisseurs) acting for their own account, as defined in and in accordance with Articles L.411-2-II-2°
and D.411-4, D.744-1, D.754-1; and D.764-1 of the French Monetary and Financial Code and any implementing regulation.
Pursuant
to Article 211-3 of the General Regulation of the AMF, investors in France are informed that the securities cannot be distributed (directly
or indirectly) to the public by the investors otherwise than in accordance with Articles L.411-1, L.411-2, L.412-1 and L.621-8 to L.621-8-3
of the French Monetary and Financial Code.
Ireland
The
information in this document does not constitute a prospectus under any Irish laws or regulations and this document has not been filed
with or approved by any Irish regulatory authority as the information has not been prepared in the context of a public offering of securities
in Ireland within the meaning of the Irish Prospectus (Directive 2003/71/EC) Regulations 2005 (the “Prospectus Regulations”).
The securities have not been offered or sold, and will not be offered, sold or delivered directly or indirectly in Ireland by way of
a public offering, except to (i) qualified investors as defined in Regulation 2(l) of the Prospectus Regulations and (ii) fewer than
100 natural or legal persons who are not qualified investors.
Israel
The
securities offered by this prospectus have not been approved or disapproved by the Israeli Securities Authority (the “ISA”),
nor have such securities been registered for sale in Israel. The shares may not be offered or sold, directly or indirectly, to the public
in Israel, absent the publication of a prospectus. The ISA has not issued permits, approvals or licenses in connection with the offering
or publishing the prospectus; nor has it authenticated the details included herein, confirmed their reliability or completeness, or rendered
an opinion as to the quality of the securities being offered. Any resale in Israel, directly or indirectly, to the public of the securities
offered by this prospectus is subject to restrictions on transferability and must be effected only in compliance with the Israeli securities
laws and regulations.
Italy
The
offering of the securities in the Republic of Italy has not been authorized by the Italian Securities and Exchange Commission (Commissione
Nazionale per le Società e la Borsa, or “CONSOB”) pursuant to the Italian securities legislation and, accordingly,
no offering material relating to the securities may be distributed in Italy and such securities may not be offered or sold in Italy in
a public offer within the meaning of Article 1.1(t) of Legislative Decree No. 58 of 24 February 1998 (“Decree No. 58”), other
than:
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● |
to
Italian qualified investors, as defined in Article 100 of Decree no.58 by reference to Article 34-ter of CONSOB Regulation no. 11971
of 14 May 1999 (“Regulation no. 1197l”) as amended (“Qualified Investors”); and |
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● |
in
other circumstances that are exempt from the rules on public offer pursuant to Article 100 of Decree No. 58 and Article 34-ter of
Regulation No. 11971 as amended. |
Any
offer, sale or delivery of the securities or distribution of any offer document relating to the securities in Italy (excluding placements
where a Qualified Investor solicits an offer from the issuer) under the paragraphs above must be:
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● |
made
by investment firms, banks or financial intermediaries permitted to conduct such activities in Italy in accordance with Legislative
Decree No. 385 of 1 September 1993 (as amended), Decree No. 58, CONSOB Regulation No. 16190 of 29 October 2007 and any other applicable
laws; and |
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in
compliance with all relevant Italian securities, tax and exchange controls and any other applicable laws. |
Any
subsequent distribution of the securities in Italy must be made in compliance with the public offer and prospectus requirement rules
provided under Decree No. 58 and the Regulation No. 11971 as amended, unless an exception from those rules applies. Failure to comply
with such rules may result in the sale of such securities being declared null and void and in the liability of the entity transferring
the securities for any damages suffered by the investors.
Japan
The
securities have not been and will not be registered under Article 4, paragraph 1 of the Financial Instruments and Exchange Law of Japan
(Law No. 25 of 1948), as amended (the “FIEL”), pursuant to an exemption from the registration requirements applicable to
a private placement of securities to Qualified Institutional Investors (as defined in and in accordance with Article 2, paragraph 3 of
the FIEL and the regulations promulgated thereunder). Accordingly, the securities may not be offered or sold, directly or indirectly,
in Japan or to, or for the benefit of, any resident of Japan other than Qualified Institutional Investors. Any Qualified Institutional
Investor who acquires securities may not resell them to any person in Japan that is not a Qualified Institutional Investor, and acquisition
by any such person of securities is conditional upon the execution of an agreement to that effect.
Portugal
This
document is not being distributed in the context of a public offer of financial securities (oferta pública de valores mobiliários)
in Portugal, within the meaning of Article 109 of the Portuguese Securities Code (Código dos Valores Mobiliários). The
securities have not been offered or sold and will not be offered or sold, directly or indirectly, to the public in Portugal. This document
and any other offering material relating to the securities have not been, and will not be, submitted to the Portuguese Securities Market
Commission (Comissăo do Mercado de Valores Mobiliários) for approval in Portugal and, accordingly, may not be distributed
or caused to distributed, directly or indirectly, to the public in Portugal, other than under circumstances that are deemed not to qualify
as a public offer under the Portuguese Securities Code. Such offers, sales and distributions of securities in Portugal are limited to
persons who are “qualified investors” (as defined in the Portuguese Securities Code). Only such investors may receive this
document and they may not distribute it or the information contained in it to any other person.
Sweden
This
document has not been, and will not be, registered with or approved by Finansinspektionen (the Swedish Financial Supervisory Authority).
Accordingly, this document may not be made available, nor may the securities be offered for sale in Sweden, other than under circumstances
that are deemed not to require a prospectus under the Swedish Financial Instruments Trading Act (1991:980) (Sw. lag (1991:980) om handel
med finansiella instrument). Any offering of securities in Sweden is limited to persons who are “qualified investors” (as
defined in the Financial Instruments Trading Act). Only such investors may receive this document and they may not distribute it or the
information contained in it to any other person.
Switzerland
The
securities may not be publicly offered in Switzerland and will not be listed on the SIX Swiss Exchange (“SIX”) or on any
other stock exchange or regulated trading facility in Switzerland. This document has been prepared without regard to the disclosure standards
for issuance prospectuses under art. 652a or art. 1156 of the Swiss Code of Obligations or the disclosure standards for listing prospectuses
under art. 27 ff. of the SIX Listing Rules or the listing rules of any other stock exchange or regulated trading facility in Switzerland.
Neither this document nor any other offering material relating to the securities may be publicly distributed or otherwise made publicly
available in Switzerland.
Neither
this document nor any other offering material relating to the securities have been or will be filed with or approved by any Swiss regulatory
authority. In particular, this document will not be filed with, and the offer of securities will not be supervised by, the Swiss Financial
Market Supervisory Authority (FINMA).
This
document is personal to the recipient only and not for general circulation in Switzerland.
United
Arab Emirates
Neither
this document nor the securities have been approved, disapproved or passed on in any way by the Central Bank of the United Arab Emirates
or any other governmental authority in the United Arab Emirates, nor has the Company received authorization or licensing from the Central
Bank of the United Arab Emirates or any other governmental authority in the United Arab Emirates to market or sell the securities within
the United Arab Emirates. This document does not constitute and may not be used for the purpose of an offer or invitation. No services
relating to the securities, including the receipt of applications and/or the allotment or redemption of such securities, may be rendered
within the United Arab Emirates by the Company.
No
offer or invitation to subscribe for securities is valid or permitted in the Dubai International Financial Centre.
United
Kingdom
Neither
the information in this document nor any other document relating to the offer has been delivered for approval to the Financial Services
Authority in the United Kingdom and no prospectus (within the meaning of section 85 of the Financial Services and Markets Act 2000, as
amended (“FSMA”) has been published or is intended to be published in respect of the securities. This document is issued
on a confidential basis to “qualified investors” (within the meaning of section 86(7) of FSMA) in the United Kingdom, and
the securities may not be offered or sold in the United Kingdom by means of this document, any accompanying letter or any other document,
except in circumstances which do not require the publication of a prospectus pursuant to section 86(1) FSMA. This document should not
be distributed, published or reproduced, in whole or in part, nor may its contents be disclosed by recipients to any other person in
the United Kingdom.
Any
invitation or inducement to engage in investment activity (within the meaning of section 21 of FSMA) received in connection with the
issue or sale of the securities has only been communicated or caused to be communicated and will only be communicated or caused to be
communicated in the United Kingdom in circumstances in which section 21(1) of FSMA does not apply to the Company.
In
the United Kingdom, this document is being distributed only to, and is directed at, persons (i) who have professional experience in matters
relating to investments falling within Article 19(5) (investment professionals) of the Financial Services and Markets Act 2000 (Financial
Promotions) Order 2005 (“FPO”), (ii) who fall within the categories of persons referred to in Article 49(2)(a) to (d) (high
net worth companies, unincorporated associations, etc.) of the FPO or (iii) to whom it may otherwise be lawfully communicated (together
“relevant persons”). The investments to which this document relates are available only to, and any invitation, offer or agreement
to purchase will be engaged in only with, relevant persons. Any person who is not a relevant person should not act or rely on this document
or any of its contents.
Pursuant
to section 3A.3 of National Instrument 33-105 Underwriting Conflicts, or NI 33-105, the underwriters are not required to comply with
the disclosure requirements of NI 33-105 regarding underwriter conflicts of interest in connection with this offering.
LEGAL
MATTERS
The
validity of the issuance of the shares of common stock offered by us in this offering will be passed upon for us by Sheppard, Mullin,
Richter & Hampton LLP, New York, New York. Dentons US LLP, New York, New York, has acted as counsel for the underwriters in connection
with certain legal matters related to this offering.
EXPERTS
The
consolidated financial statements as of and for the years ended December 31, 2022 and 2021, included in our Annual Report on Form 10-K/A
for the year ended December 31, 2022, have been audited by Mayer Hoffman McCann P.C., independent registered public accounting firm,
as set forth in their report (which report includes an explanatory paragraph regarding the existence of substantial doubt about the Company’s
ability to continue as a going concern), and have been incorporated herein by reference in reliance upon such report, given on the authority
of such firm as experts in auditing and accounting in giving said reports.
WHERE
YOU CAN FIND MORE INFORMATION
This
prospectus is part of a registration statement we filed with the SEC. This prospectus does not contain all of the information set forth
in the registration statement and the exhibits to the registration statement. For further information with respect to us and the securities
we are offering under this prospectus, we refer you to the registration statement and the exhibits and schedules filed as a part of the
registration statement. You should rely only on the information contained in this prospectus or incorporated by reference into this prospectus.
We have not authorized anyone else to provide you with different information. We are not making an offer of these securities in any jurisdiction
where the offer is not permitted. You should assume that the information contained in this prospectus, or any document incorporated by
reference in this prospectus, is accurate only as of the date of those respective documents, regardless of the time of delivery of this
prospectus or any sale of our securities.
We
file annual, quarterly and current reports, proxy statements and other information with the SEC. Our SEC filings are available to the
public from commercial document retrieval services and over the Internet at the SEC’s website at http://www.sec.gov.
We
maintain a website at www.tharimmune.com. You may access our annual reports on Form 10-K, quarterly reports on Form 10-Q, current
reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act with the
SEC free of charge at our website as soon as reasonably practicable after such material is electronically filed with, or furnished to,
the SEC. The information contained in, or that can be accessed through, our website is not incorporated by reference into, and is not
part of, this prospectus.
INCORPORATION
OF DOCUMENTS BY REFERENCE
This
prospectus is part of the registration statement, but the registration statement includes and incorporates by reference additional information
and exhibits. The SEC permits us to “incorporate by reference” the information contained in documents we file with the SEC,
which means that we can disclose important information to you by referring you to those documents rather than by including them in this
prospectus. Information that is incorporated by reference is considered to be part of this prospectus and you should read it with the
same care that you read this prospectus. Information that we file later with the SEC will automatically update and supersede the information
that is either contained, or incorporated by reference, in this prospectus, and will be considered to be a part of this prospectus from
the date those documents are filed.
We
incorporate by reference the documents listed below, all filings filed by us pursuant to the Exchange Act after the date of the registration
statement of which this prospectus form a part, and any future filings we make with the SEC under Sections 13(a), 13(c), 14 or 15(d)
of the Exchange Act prior to the time that all securities covered by this prospectus have been sold; provided, however, that we are not
incorporating any information furnished under either Item 2.02 or Item 7.01 of any Current Report on Form 8-K and exhibits furnished
on such form that relate to such items:
● |
our
Annual Report on Form 10-K/A for the year ended December 31, 2022 filed with the SEC on May 22, 2023; |
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our
Quarterly Reports on Form 10-Q for the quarters ended March
31, 2023, June
30, 2023 and September 30, 2023 filed with the SEC on May 22, 2023, August 11, 2023 and November 7, 2023,
respectively; |
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our
Current Reports on Form 8-K filed with the SEC on February
14, 2023, May
1, 2023, May
15, 2023, May
22, 2023, June
16, 2023, June
20, 2023, July
11, 2023, July
17, 2023, September
25, 2023, October
24, 2023, November
7, 2023, November 16, 2023 and November 17, 2023; and |
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the
description of our common stock contained in our Registration Statement on Form 8-A filed with the Commission on January 10, 2022,
including any amendments or reports filed with the SEC for the purposes of updating such description. |
Any
statements made in a document incorporated by reference in this prospectus are deemed to be modified or superseded for purposes of this
prospectus to the extent that a statement in this prospectus or in any other subsequently filed document, which is also incorporated
by reference, modifies or supersedes the statement. Any statement made in this prospectus is deemed to be modified or superseded to the
extent a statement in any subsequently filed document, which is incorporated by reference in this prospectus, modifies or supersedes
such statement. Any statement so modified or superseded will not be deemed, except as so modified or superseded, to constitute a part
of this prospectus.
The
information relating to us contained in this prospectus should be read together with the information in the documents incorporated by
reference. In addition, certain information, including financial information, contained in this prospectus or incorporated by reference
in this prospectus should be read in conjunction with documents we have filed with the SEC.
We
will provide to each person, including any beneficial holder, to whom a prospectus is delivered, at no cost, upon written or oral request,
a copy of any or all of the information that has been incorporated by reference in the prospectus but not delivered with the prospectus.
Requests for documents should be by writing to or telephoning us at the following address: Tharimmune, Inc., 1200 Route 22 East, Suite
2000, Bridgewater, NJ 08807, (908) 955-3140. Exhibits to these filings will not be sent unless those exhibits have been specifically
incorporated by reference in such filings.
Up
to 2,105,263 Shares of Common Stock
Up
to 2,105,263 Pre-Funded Warrants to Purchase
up to 2,105,263 Shares of Common Stock
PRELIMINARY
PROSPECTUS
ThinkEquity
, 2023
PART
II—INFORMATION NOT REQUIRED IN PROSPECTUS
Item
13. Other Expenses of Issuance and Distribution
The
following table sets forth all expenses, other than the underwriting discounts and commissions, payable by the registrant in connection
with the sale of the securities being registered. All the amounts shown are estimates except the SEC registration fee and the FINRA filing
fee.
|
|
Amount
to be paid |
|
SEC
registration fee |
|
$ |
1,762 |
|
FINRA
filing fee |
|
$ |
1,693 |
|
Accounting
fees and expenses |
|
$ |
50,000 |
|
Legal
fees and expenses |
|
$ |
130,000 |
|
Printing
and engraving expenses |
|
$ |
10,000 |
|
Miscellaneous |
|
$ |
6,545 |
|
|
|
|
|
|
Total |
|
$ |
200,000 |
|
* To be filed by amendment.
Item
14. Indemnification of Directors and Officers
Section
102 of the DGCL permits a corporation to eliminate the personal liability of directors of a corporation to the corporation or its stockholders
for monetary damages for a breach of fiduciary duty as a director, except where the director breached his/her duty of loyalty, failed
to act in good faith, engaged in intentional misconduct or knowingly violated a law, authorized the payment of a dividend or approved
a stock repurchase in violation of Delaware corporate law or obtained an improper personal benefit. Our Certificate of Incorporation
provides that no director of the Company shall be personally liable to it or its stockholders for monetary damages for any breach of
fiduciary duty as a director, notwithstanding any provision of law imposing such liability, except to the extent that the DGCL prohibits
the elimination or limitation of liability of directors for breaches of fiduciary duty.
Section
145 of the DGCL provides that a corporation has the power to indemnify a director, officer, employee, or agent of the corporation, or
a person serving at the request of the corporation for another corporation, partnership, joint venture, trust or other enterprise in
related capacities against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by the person in connection with an action, suit or proceeding to which he/she was or is a party or is threatened to be made
a party to any threatened, pending or completed action, suit or proceeding by reason of such position, if such person acted in good faith
and in a manner he/she reasonably believed to be in or not opposed to the best interests of the corporation, and, in any criminal action
or proceeding, had no reasonable cause to believe his/her conduct was unlawful, except that, in the case of actions brought by or in
the right of the corporation, no indemnification shall be made with respect to any claim, issue or matter as to which such person shall
have been adjudged to be liable to the corporation unless and only to the extent that the Court of Chancery or other adjudicating court
determines that, despite the adjudication of liability but in view of all of the circumstances of the case, such person is fairly and
reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court shall deem proper.
Our Certificate of Incorporation and Bylaws provide indemnification for our directors and officers to the fullest extent permitted by
the DGCL. We will indemnify each person who was or is a party or threatened to be made a party to any threatened, pending or completed
action, suit or proceeding (other than an action by or in the right of us) by reason of the fact that he or she is or was, or has agreed
to become, a director or officer, or is or was serving, or has agreed to serve, at our request as a director, officer, partner, employee
or trustee of, or in a similar capacity with, another corporation, partnership, joint venture, trust or other enterprise (all such persons
being referred to as an “Indemnitee”), or by reason of any action alleged to have been taken or omitted in such capacity,
against all expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred
in connection with such action, suit or proceeding and any appeal therefrom, if such Indemnitee acted in good faith and in a manner he
or she reasonably believed to be in, or not opposed to, our best interests, and, with respect to any criminal action or proceeding, he
or she had no reasonable cause to believe his or her conduct was unlawful. Our Certificate of Incorporation and Bylaws provide that we
will indemnify any Indemnitee who was or is a party to an action or suit by or in the right of us to procure a judgment in our favor
by reason of the fact that the Indemnitee is or was, or has agreed to become, a director or officer, or is or was serving, or has agreed
to serve, at our request as a director or officer of another corporation, partnership, joint venture, trust or other enterprise, or who
was an employee or agent of a predecessor corporation or another enterprise at the request of such predecessor corporation, against all
expenses (including attorneys’ fees) and, to the extent permitted by law, amounts paid in settlement actually and reasonably incurred
in connection with such action, suit or proceeding, except that no indemnification shall be made with respect to any claim, issue or
matter as to which such person shall have been adjudged to be liable to us, unless a court determines that, despite such adjudication
but in view of all of the circumstances, he or she is entitled to indemnification of such expenses. Expenses must be advanced to an Indemnitee
under certain circumstances.
We
have entered into separate indemnification agreements with each of our directors and executive officers. Each indemnification agreement
provides, among other things, for indemnification to the fullest extent permitted by law and our Certificate of Incorporation and Bylaws
against any and all expenses, judgments, fines, penalties and amounts paid in settlement of any claim. The indemnification agreements
provide for the advancement or payment of all expenses to the indemnitee and for the reimbursement to us if it is found that such indemnitee
is not entitled to such indemnification.
We
maintain a general liability insurance policy that covers certain liabilities of directors and officers of our corporation arising out
of claims based on acts or omissions in their capacities as directors or officers.
Item
15. Recent Sales of Unregistered Securities
Set
forth below is information regarding securities issued by us since during the prior three years that were not registered under the Securities
Act.
2023
In August 2023, we issued 2,801
shares of our common stock for services.
In July 2023, we issued 25,107
shares of our common stock pursuant to a license agreement.
2022
Commencing
in May 2017, we issued convertible promissory notes (the “Notes”) to certain investors to help finance our operations. The
principal amount of such Notes ranged from $1,000 to $300,000. On January 14, 2022, all outstanding Notes and accrued interest were converted
into an aggregate of 49,015 shares of our common stock.
From
January 2022 to March 2022, we issued 1,270 shares of common stock with a per share value of $78.75.
On
February 25, 2022, we issued 1,270 shares of common stock for services.
2021
From
January 2021 to December 15, 2021, the Company issued convertible promissory notes in an aggregate principal amount of $1,716,992 to
certain investors.
From
January 2021 to June 15, 2021, the Company granted stock options to purchase an aggregate of 9,109 shares of its common stock
at a weighted-average exercise price of $193.90 per share to employees, directors and non-employee service providers pursuant
to its 2019 Stock Incentive Plan.
2020
From
January 2020 to December 2020, the Company issued convertible promissory notes in an aggregate principal amount of $1,287,068 to certain
investors.
From
January 2020 to December 2020, the Company granted stock options to purchase an aggregate of 8,015 shares of its common stock
at a weighted-average exercise price of $70.07 per share to employees, directors and non-employee service providers pursuant to
its 2019 Stock Incentive Plan.
In
November 2020, the Company issued an aggregate of 3,030 shares of its common stock in connection with the stock exchange agreement
with Farrington pursuant to which Farrington became a wholly-owned subsidiary of the Company.
The
foregoing offers, sales and issuances were exempt from registration under Section 4(a)(2) of the Securities Act or Rule 701 of the Securities
Act.
Item
16. Exhibits and Financial Statement Schedules
EXHIBIT
INDEX
Exhibit
No. |
|
Title
of Document |
1.1* |
|
Form of Underwriting Agreement |
3.1 |
|
Certificate of Incorporation (Incorporated by reference to Exhibit 3.1 to the Company’s Registration Statement on Form S-1 filed with the SEC on September 27, 2021) |
3.2 |
|
Amendment to Certificate of Incorporation dated August 7, 2019 (Incorporated by reference to Exhibit 3.2 to the Company’s Registration Statement on Form S-1 filed with the SEC on September 27, 2021) |
3.3 |
|
Amendment to Certificate of Incorporation dated September 16, 2021 (Incorporated by reference to Exhibit 3.3 to the Company’s Registration Statement on Form S-1 filed with the SEC on September 27, 2021) |
3.4 |
|
Amendment to Certificate of Incorporation dated October 11, 2021 (Incorporated by reference to Exhibit 3.5 to the Company’s Registration Statement on Form S-1/A filed with the SEC on October 15, 2021) |
3.5 |
|
Bylaws (Incorporated by reference to Exhibit 3.4 to the Company’s Registration Statement on Form S-1 filed with the SEC on September 27, 2021) |
3.6 |
|
Certificate of Amendment to Certificate of Incorporation dated September 21, 2023 (Incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the SEC on September 25, 2023) |
4.1 |
|
Specimen Stock Certificate Evidencing the Shares of Common Stock (Incorporated by reference to Exhibit 4.1 to the Company’s Registration Statement on Form S-1 filed with the SEC on September 27, 2021) |
4.2 |
|
Form of Underwriter Warrant (Incorporated by reference to Exhibit 4.2 to the Company’s Registration Statement on Form S-1/A filed with the SEC on December 10, 2021) |
4.3* |
|
Form of Representative’s Warrant |
4.4* |
|
Form of Pre-funded Warrant |
5.1* |
|
Opinion of Sheppard, Mullin, Richter & Hampton LLP |
10.1+ |
|
Hillstream BioPharma, Inc. 2017 Stock Incentive Plan (Incorporated by reference to Exhibit 10.2 to the Company’s Registration Statement on Form S-1 filed with the SEC on September 27, 2021) |
10.2+ |
|
Hillstream BioPharma, Inc. 2019 Stock Incentive Plan (Incorporated by reference to Exhibit 10.1 to the Company’s Registration Statement on Form S-8 filed with the SEC on February 22, 2022) |
10.3# |
|
Research and Development Collaboration and License Agreement by and between the Company and Applied Biomedical Science Institute dated July 5, 2023 (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on July 11, 2023) |
10.4+ |
|
Employment Agreement by and between the Company and Sireesh Appajosyula dated July 11, 2023 (Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed with the SEC on July 11, 2023) |
10.5+ |
|
Amended and Restated Employment Agreement by and between the Company and Randy Milby dated July 6, 2023 (Incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed with the SEC on July 11, 2023) |
10.6+ |
|
Tharimmune, Inc. 2023 Omnibus Equity Incentive Plan (Incorporated by reference to Exhibit 10.1 to the Company’s Registration Statement on Form S-8 filed with the SEC on November 2, 2023) |
10.7#** |
|
Patent License Agreement by and between the Company and Avior Inc. dba Avior Bio dated November 3, 2023 |
16.1 |
|
Letter of Mayer Hoffman McCann P.C. dated June 20, 2023 (Incorporated by reference to Exhibit 16.1 to the Company’s Current Report on Form 8-K filed with the SEC on June 20, 2023) |
21.1 |
|
Subsidiaries (Incorporated by reference to Exhibit 21.1 to the Company’s Annual Report on Form 10-K filed with the SEC on March 16, 2023) |
23.1* |
|
Consent of Mayer Hoffman McCann P.C. |
23.2* |
|
Consent of Sheppard, Mullin, Richter & Hampton LLP (included in Exhibit 5.1) |
24.1** |
|
Power of Attorney (included on signature page hereto) |
107** |
|
Filing Fee Table |
*
Filed herewith.
**
Previously filed.
+
Management contract or compensatory plan or arrangement.
# Pursuant to Item 601(b)(10) of Regulation
S-K, certain confidential portions of this exhibit were omitted by means of marking such portions with an asterisk because such information
is both not material and is the type that the Company treats as private or confidential.
Item
17. Undertakings
The
undersigned registrant hereby undertakes:
|
(1) |
To
file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: |
|
(i) |
To
include any prospectus required by section 10(a)(3) of the Securities Act of 1933; |
|
(ii) |
To
reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set
forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if
the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end
of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b)
if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set
forth in the “Calculation of Registration Fee” table in the effective registration statement. |
|
(iii) |
To
include any material information with respect to the plan of distribution not previously
disclosed in the registration statement or any material change to such information in the
registration statement;
provided,
however, that paragraphs (i), (ii) and (iii) do not apply if the registration statement is on Form S-1 and the information required
to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the Commission
by the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference
in the registration statement, or is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the registration
statement; |
|
(2) |
That,
for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof. |
|
(3) |
To
remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the
termination of the offering. |
|
(4) |
That,
for the purpose of determining liability under the Securities Act of 1933 to any purchaser: each prospectus filed pursuant to Rule
424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other
than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of
the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus
that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration
statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior
to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the
registration statement or made in any such document immediately prior to such date of first use; and |
|
(5) |
That,
for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution
of the securities: the undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant
to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities
are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller
to the purchaser and will be considered to offer or sell such securities to such purchaser: |
|
(i) |
Any
preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule
424; |
|
(ii) |
Any
free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by
the undersigned registrant; |
|
(iii) |
The
portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant
or its securities provided by or on behalf of the undersigned registrant; and |
|
(iv) |
Any
other communication that is an offer in the offering made by the undersigned registrant to the purchaser. |
|
Insofar
as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion
of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act of 1933
and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment
by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense
of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities
being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed
in the Act and will be governed by the final adjudication of such issue. |
SIGNATURES
Pursuant
to the requirements of the Securities Act of 1933, as amended, the registrant has duly caused this Registration Statement on Form S-1
to be signed on its behalf by the undersigned, thereunto duly authorized in the City of Bridgewater, State of New Jersey, on the 17th
day of November 2023.
|
THARIMMUNE,
INC. |
|
|
|
|
By: |
/s/
Randy Milby |
|
|
Randy
Milby |
|
|
Chief
Executive Officer(Principal
Executive
Officer) and Chairman of
the
Board of Directors |
Pursuant
to the requirements of the Securities Act of 1933, as amended, this Registration Statement on Form S-1 has been signed by the following
persons in the capacities and on the dates indicated below.
Signature |
|
Title |
|
Date |
|
|
|
|
|
/s/
Randy Milby |
|
Chief
Executive Officer and Chairman of the Board of Directors |
|
November
17, 2023 |
Randy
Milby |
|
(Principal
Executive Officer) |
|
|
|
|
|
|
|
* |
|
Chief
Financial Officer |
|
November
17, 2023 |
Thomas
Hess |
|
(Principal
Accounting and Financial Officer) |
|
|
|
|
|
|
|
* |
|
|
|
|
Lynne
Bui |
|
Director |
|
November
17, 2023 |
|
|
|
|
|
* |
|
Director |
|
November
17, 2023 |
Leonard
Mazur |
|
|
|
|
|
|
|
|
|
* |
|
Director |
|
November
17, 2023 |
Sireesh
Appajosyula |
|
|
|
|
|
|
|
|
|
* |
|
Director |
|
November
17, 2023 |
Kelly
Anderson |
|
|
|
|
* By: |
/s/ Randy Milby |
|
|
Randy Milby |
|
|
Attorney-in-Fact |
|
Exhibit
1.1
UNDERWRITING
AGREEMENT
between
THARIMMUNE,
INC.
and
THINKEQUITY
LLC
as
Representative of the Several Underwriters
THARIMMUNE,
INC.
UNDERWRITING
AGREEMENT
New
York, New York
[__], 2023
ThinkEquity
LLC
As
Representative of the several Underwriters named on Schedule 1 attached hereto
17 State Street, 41st Floor
New
York, NY 10004
Ladies
and Gentlemen:
The
undersigned, Tharimmune, Inc. (formerly Hillstream BioPharma, Inc.), a corporation formed under the laws of the State of Delaware (collectively
with its subsidiaries and affiliates, including, without limitation, all entities disclosed or described in the Registration Statement
(as hereinafter defined) as being subsidiaries or affiliates of Tharimmune, Inc., the “Company”), hereby confirms its agreement
(this “Agreement”) with ThinkEquity LLC (hereinafter referred to as “you” (including its correlatives) or the
“Representative”) and with the other underwriters named on Schedule 1 hereto for which the Representative is acting
as representative (the Representative and such other underwriters being collectively called the “Underwriters” or, individually,
an “Underwriter”) as follows:
1.
Purchase and Sale of Securities.
1.1
Firm Securities.
1.1.1.
Nature and Purchase of Firm Securities.
(i)
On the basis of the representations and warranties herein contained, but subject to the terms and conditions herein set forth, the Company
agrees to issue and sell to the several Underwriters, an aggregate of [__] shares (each a “Firm Share”, and in the aggregate,
the “Firm Shares”) of the Company’s common stock, par value $0.0001 per share (the “Common Stock”), and
an aggregate of [_] pre-funded warrants (each, a “Pre-Funded Warrant”, and in the aggregate, the “Firm Pre-Funded Warrants”;
and together with the Firm Shares, the “Firm Securities”) to purchase one share of Common Stock at an exercise price of $0.001
until such time as the Pre-Funded Warrant is exercised in full, subject to adjustment as provided in the Pre-Funded Warrant.
(ii)
The Underwriters, severally and not jointly, agree to purchase from the Company the number of Firm Shares and Firm Pre-Funded Warrants
set forth opposite their respective names on Schedule 1 attached hereto and made a part hereof at a purchase price of $[__] per
Firm Share (93% of the per Firm Share offering price) and $[__] per Firm Pre-Funded Warrant (93% of the per Firm Share offering price
minus $0.001). The Firm Securities are to be offered initially to the public at the offering price set forth on the cover page of the
Prospectus (as defined in Section 2.1.1 hereof).
1.1.2.
Shares Payment and Delivery.
(i)
Delivery and payment for the Firm Securities shall be made at 10:00 a.m., Eastern time, on the second (2nd) Business Day following
the effective date (the “Effective Date”) of the Registration Statement (as defined in Section 2.1.1 below) (or the third
(3rd) Business Day following the Effective Date if the Registration Statement is declared effective after 4:01 p.m., Eastern
time) or at such earlier time as shall be agreed upon by the Representative and the Company, at the offices of Dentons US LLP, 1221 Avenue
of the Americas, New York, NY 10020 (“Representative Counsel”), or at such other place (or remotely by facsimile or other
electronic transmission) as shall be agreed upon by the Representative and the Company. The hour and date of delivery and payment for
the Firm Securities is called the “Closing Date.”
(ii)
Payment for the Firm Securities shall be made on the Closing Date by wire transfer in Federal (same day) funds, payable to the order
of the Company upon delivery of the certificates (in form and substance satisfactory to the Underwriters) representing the Firm Securities
(or through the facilities of the Depository Trust Company (“DTC”)) for the account of the Underwriters. The Firm Securities
shall be registered in such name or names and in such authorized denominations as the Representative may request in writing at least
two (2) full Business Days prior to the Closing Date. The Company shall not be obligated to sell or deliver the Firm Securities except
upon tender of payment by the Representative for all of the Firm Securities. The term “Business Day” means any day other
than a Saturday, a Sunday or a legal holiday or a day on which banking institutions are authorized or obligated by law to close in New
York, New York.
1.2
Over-allotment Option.
1.2.1.
Option Securities. For the purposes of covering any over-allotments in connection with the distribution and sale of the Firm Securities,
the Company hereby grants to the Representative an option (the “Over-allotment Option”) to purchase up to [__] additional
shares of Common Stock and/or Pre-Funded Warrants, representing fifteen percent (15%) of the Firm Shares and Firm Pre-Funded Warrants
sold in the offering, from the Company (the “Option Shares” or “Option Pre-Funded Warrants,” as applicable).
The purchase price to be paid per Option Share shall be equal to the price per Firm Share set forth in Section 1.1.1(ii) hereof and the
purchase price to be paid per Option Pre-Funded Warrant shall be equal to the price per Firm Pre-Funded Warrant set forth in Section
1.1.1(ii) hereof. The Over-allotment Option is, at the Underwriters’ sole discretion, for Option Shares and Option Pre-Funded Warrants
together, solely Option Shares or solely Option Pre-Funded Warrants, or any combination thereof (each, an “Option Security”
and collectively, the “Option Securities”). The Firm Securities and the Option Securities are collectively referred to as
the “Securities.” The Securities and the Underlying Shares (as defined below), are collectively referred to as the “Public
Securities.” The Public Securities shall be issued directly by the Company and shall have the rights and privileges described in
the Registration Statement, the Pricing Disclosure Package and the Prospectus. The certificate (the “Pre-Funded Warrant Certificate”)
evidencing the Firm Pre-Funded Warrants and the Option Pre-Funded Warrants, if any, will be in the form attached hereto as Exhibit
A. The offering and sale of the Public Securities is herein referred to as the “Offering.”
1.2.2.
Exercise of Option. The Over-allotment Option granted pursuant to Section 1.2.1 hereof may be exercised by the Representative
as to all (at any time) or any part (from time to time) of the Option Securities within forty five (45) days after the Closing Date.
The Underwriters shall not be under any obligation to purchase any Option Securities prior to the exercise of the Over-allotment Option.
The Over-allotment Option granted hereby may be exercised by the giving of oral notice to the Company from the Representative, which
must be confirmed in writing by overnight mail or facsimile or other electronic transmission setting forth the number of Option Securities
to be purchased and the date and time for delivery of and payment for the Option Securities (the “Option Closing Date”),
which shall not be later than one (1) full Business Day after the date of the notice or such other time as shall be agreed upon by the
Company and the Representative, at the offices of Representative Counsel or at such other place (including remotely by facsimile or other
electronic transmission) as shall be agreed upon by the Company and the Representative. If such delivery and payment for the Option Securities
does not occur on the Closing Date, the Option Closing Date will be as set forth in the notice. Upon exercise of the Over-allotment Option
with respect to all or any portion of the Option Securities, subject to the terms and conditions set forth herein, (i) the Company shall
become obligated to sell to the Underwriters the number of Option Securities specified in such notice and (ii) each of the Underwriters,
acting severally and not jointly, shall purchase that portion of the total number of Option Securities then being purchased as set forth
in Schedule 1 opposite the name of such Underwriter bears to the total number of Firm Securities, subject, in each case, to such
adjustments as the Representative, in its sole discretion, shall determine.
1.2.3.
Payment and Delivery. Payment for the Option Securities shall be made on the Option Closing Date by wire transfer in Federal (same
day) funds, payable to the order of the Company upon delivery to you of certificates (in form and substance satisfactory to the Underwriters)
representing the Option Securities (or through the facilities of DTC) for the account of the Underwriters. The Option Securities shall
be registered in such name or names and in such authorized denominations as the Representative may request in writing at least one (1)
full Business Day prior to the Option Closing Date. The Company shall not be obligated to sell or deliver the Option Securities except
upon tender of payment by the Representative for applicable Option Securities. The Option Closing Date may be simultaneous with, but
not earlier than, the Closing Date; and in the event that such time and date are simultaneous with the Closing Date, the term “Closing
Date” shall refer to the time and date of delivery of the Firm Securities and Option Securities.
1.3
Representative’s Warrants.
1.3.1.
Purchase Warrants. The Company hereby agrees to issue and sell to the Representative (and/or its designees) on the Closing Date
and Option Closing Date, as applicable, a warrant (“Representative’s Warrant”) for the purchase of an aggregate number
of shares of Common Stock representing three percent (3%) of the Public Securities, purchased on such Closing Date or Option Closing
Date, for an aggregate purchase price of $100.00. The Representative’s Warrant agreement, in the form attached hereto as Exhibit
B (the “Representative’s Warrant Agreement”), shall be exercisable, in whole or in part, commencing on a date which
is one hundred eighty (180) days after the Effective Date and expiring on the five-year anniversary of the Effective Date at an initial
exercise price per share of Common Stock of $[__], which is equal to 125% of the public offering price of the Firm Shares. The Representative’s
Warrant Agreement and the shares of Common Stock issuable upon exercise thereof are hereinafter referred to together as the “Representative’s
Securities.” The Representative understands and agrees that there are significant restrictions pursuant to FINRA Rule 5110 against
transferring the Representative’s Warrant Agreement and the underlying shares of Common Stock during the one hundred eighty (180)
days immediately following the date of effectiveness or commencement of sales of the offering and by its acceptance thereof shall agree
that it will not sell, transfer, assign, pledge or hypothecate the Representative’s Warrant Agreement, or any portion thereof,
or be the subject of any hedging, short sale, derivative, put or call transaction that would result in the effective economic disposition
of such securities for a period of one hundred eighty (180) days immediately following the date of effectiveness or commencement of sales
of the offering to anyone other than (i) an Underwriter or a selected dealer in connection with the Offering, or (ii) a bona fide officer
or partner of the Representative or of any such Underwriter or selected dealer; and only if any such transferee agrees to the foregoing
lock-up restrictions.
1.3.2.
Delivery. Delivery of the Representative’s Warrant Agreement shall be made on the Closing Date and any Option Closing Date
and shall be issued in the name or names and in such authorized denominations as the Representative may request.
2.
Representations and Warranties of the Company. The Company represents and warrants to the Underwriters as of the Applicable Time
(as defined below), as of the Closing Date and as of the Option Closing Date, if any, as follows:
2.1
Filing of Registration Statement.
2.1.1.
Pursuant to the Securities Act. The Company has filed with the U.S. Securities and Exchange Commission (the “Commission”)
a registration statement, and an amendment or amendments thereto, on Form S-1 (File No. 333-[__]), including any related prospectus or
prospectuses, for the registration of the Public Securities and the Representative’s Securities under the Securities Act of 1933,
as amended (the “Securities Act”), which registration statement and amendment or amendments have been prepared by the Company
in all material respects in conformity with the requirements of the Securities Act and the rules and regulations of the Commission under
the Securities Act (the “Securities Act Regulations”) and contains and will contain all material statements that are required
to be stated therein in accordance with the Securities Act and the Securities Act Regulations. Except as the context may otherwise require,
such registration statement, as amended, on file with the Commission at the time the registration statement became effective (including
the Preliminary Prospectus included in the registration statement, financial statements, schedules, exhibits and all other documents
filed as a part thereof or incorporated therein and all information deemed to be a part thereof as of the Effective Date pursuant to
paragraph (b) of Rule 430A of the Securities Act Regulations (the “Rule 430A Information”)), is referred to herein as the
“Registration Statement.” If the Company files any registration statement pursuant to Rule 462(b) of the Securities Act Regulations,
then after such filing, the term “Registration Statement” shall include such registration statement filed pursuant to Rule
462(b). The Registration Statement was declared effective by the Commission on [__], 2023.
Each
prospectus used prior to the effectiveness of the Registration Statement, and each prospectus that omitted the Rule 430A Information
that was used after such effectiveness and prior to the execution and delivery of this Agreement, is herein called a “Preliminary
Prospectus.” The Preliminary Prospectus, subject to completion, dated [__], 2023, that was included in the Registration Statement
immediately prior to the Applicable Time is hereinafter called the “Pricing Prospectus.” The final prospectus in the form
first furnished to the Underwriters for use in the Offering is hereinafter called the “Prospectus.” Any reference to the
“most recent Preliminary Prospectus” shall be deemed to refer to the latest Preliminary Prospectus included in the Registration
Statement.
“Applicable
Time” means [__], Eastern time, on the date of this Agreement.
“Issuer
Free Writing Prospectus” means any “issuer free writing prospectus,” as defined in Rule 433 of the Securities Act Regulations
(“Rule 433”), including, without limitation, any “free writing prospectus” (as defined in Rule 405 of the Securities
Act Regulations) relating to the Public Securities that is (i) required to be filed with the Commission by the Company, (ii) a “road
show that is a written communication” within the meaning of Rule 433(d)(8)(i), whether or not required to be filed with the Commission,
or (iii) exempt from filing with the Commission pursuant to Rule 433(d)(5)(i) because it contains a description of the Public Securities
or of the Offering that does not reflect the final terms, in each case in the form filed or required to be filed with the Commission
or, if not required to be filed, in the form retained in the Company’s records pursuant to Rule 433(g).
“Issuer
General Use Free Writing Prospectus” means any Issuer Free Writing Prospectus that is intended for general distribution to prospective
investors (other than a “bona fide electronic road show,” as defined in Rule 433 (the “Bona Fide Electronic
Road Show”)), as evidenced by its being specified in Schedule 2-B hereto.
“Issuer
Limited Use Free Writing Prospectus” means any Issuer Free Writing Prospectus that is not an Issuer General Use Free Writing Prospectus.
“Pricing
Disclosure Package” means any Issuer General Use Free Writing Prospectus issued at or prior to the Applicable Time, the Pricing
Prospectus and the information included on Schedule 2-A hereto, all considered together.
2.1.2.
Pursuant to the Exchange Act. The Company has filed with the Commission a Form 8-A (File Number 001-41210) providing for the registration
pursuant to Section 12(b) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), of the shares of Common
Stock. The registration of the shares of Common Stock under the Exchange Act has been declared effective by the Commission on or prior
to the date hereof. The Company has taken no action designed to, or likely to have the effect of, terminating the registration of the
shares of Common Stock under the Exchange Act, nor has the Company received any notification that the Commission is contemplating terminating
such registration.
2.2
Stock Exchange Listing. The shares of Common Stock are listed on The Nasdaq Capital Market (the “Exchange”) under
the symbol “THAR”, and the Company has taken no action designed to, or likely to have the effect of, delisting the shares
of Common Stock from the Exchange, nor has the Company received any notification that the Exchange is contemplating terminating such
listing except as described in the Registration Statement, the Pricing Disclosure Package and the Prospectus. The Company has submitted
the Listing of Additional Shares Notification Form with the Exchange with respect to the Offering of the Public Securities.
2.3
No Stop Orders, etc. Neither the Commission nor, to the Company’s knowledge, any state regulatory authority has issued any
order preventing or suspending the use of the Registration Statement, any Preliminary Prospectus or the Prospectus or has instituted
or, to the Company’s knowledge, threatened to institute, any proceedings with respect to such an order. The Company has complied
with each request (if any) from the Commission for additional information.
2.4
Disclosures in Registration Statement.
2.4.1.
Compliance with Securities Act and 10b-5 Representation.
(i)
Each of the Registration Statement and any post-effective amendment thereto, at the time it became effective, complied in all material
respects with the requirements of the Securities Act and the Securities Act Regulations. Each Preliminary Prospectus, including the prospectus
filed as part of the Registration Statement as originally filed or as part of any amendment or supplement thereto, and the Prospectus,
at the time each was filed with the Commission, complied in all material respects with the requirements of the Securities Act and the
Securities Act Regulations. Each Preliminary Prospectus delivered to the Underwriters for use in connection with this Offering and the
Prospectus was or will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except
to the extent permitted by Regulation S-T.
(ii)
Neither the Registration Statement nor any amendment thereto, at its effective time, as of the Applicable Time, at the Closing Date or
at any Option Closing Date (if any), contained, contains or will contain an untrue statement of a material fact or omitted, omits or
will omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading.
(iii)
The Pricing Disclosure Package, as of the Applicable Time, at the Closing Date or at any Option Closing Date (if any), did not, does
not and will not include an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not misleading; and each Issuer Limited Use Free Writing Prospectus
hereto does not conflict with the information contained in the Registration Statement, any Preliminary Prospectus, the Pricing Prospectus
or the Prospectus, and each such Issuer Limited Use Free Writing Prospectus, as supplemented by and taken together with the Pricing Prospectus
as of the Applicable Time, did not include an untrue statement of a material fact or omit to state a material fact necessary in order
to make the statements therein, in light of the circumstances under which they were made, not misleading; provided, however, that this
representation and warranty shall not apply to statements made or statements omitted in reliance upon and in conformity with written
information furnished to the Company with respect to the Underwriters by the Representative expressly for use in the Registration Statement,
the Preliminary Prospectus, the Pricing Prospectus or the Prospectus or any amendment thereof or supplement thereto. The parties acknowledge
and agree that such information provided by or on behalf of any Underwriter consists solely of the following disclosure contained in
the “Underwriting” section of the Prospectus: the disclosure under the headings “Discretionary Accounts,” “Price
Stabilization, Short Positions and Penalty Bids,” “Electronic Offer, Sale and Distribution of Securities” and “Offering
Restrictions Outside the United States” (the “Underwriters’ Information”); and
(iv)
Neither the Prospectus nor any amendment or supplement thereto (including any prospectus wrapper), as of its issue date, at the time
of any filing with the Commission pursuant to Rule 424(b), at the Closing Date or at any Option Closing Date, included, includes or will
include an untrue statement of a material fact or omitted, omits or will 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 this representation
and warranty shall not apply to the Underwriters’ Information.
2.4.2.
Disclosure of Agreements. The agreements and documents described in the Registration Statement, the Pricing Disclosure Package
and the Prospectus conform in all material respects to the descriptions thereof contained therein and there are no agreements or other
documents required by the Securities Act and the Securities Act Regulations to be described in the Registration Statement, the Pricing
Disclosure Package and the Prospectus or to be filed with the Commission as exhibits to the Registration Statement, that have not been
so described or filed. Each agreement or other instrument (however characterized or described) to which the Company is a party or by
which it is or may be bound or affected and (i) that is referred to in the Registration Statement, the Pricing Disclosure Package and
the Prospectus, or (ii) is material to the Company’s business, has been duly authorized and validly executed by the Company, is
in full force and effect in all material respects and is enforceable against the Company and, to the Company’s knowledge, the other
parties thereto, in accordance with its terms, except (x) as such enforceability may be limited by bankruptcy, insolvency, reorganization
or similar laws affecting creditors’ rights generally, (y) as enforceability of any indemnification or contribution provision may
be limited under the federal and state securities laws, and (z) that the remedy of specific performance and injunctive and other forms
of equitable relief may be subject to the equitable defenses and to the discretion of the court before which any proceeding therefor
may be brought. None of such agreements or instruments has been assigned by the Company, and neither the Company nor, to the Company’s
knowledge, any other party is in default thereunder and, to the Company’s knowledge, no event has occurred that, with the lapse
of time or the giving of notice, or both, would constitute a default thereunder. To the best of the Company’s knowledge, performance
by the Company of the material provisions of such agreements or instruments will not result in a violation of any existing applicable
law, rule, regulation, judgment, order or decree of any governmental agency or court, domestic or foreign, having jurisdiction over the
Company or any of its assets or businesses (each, a “Governmental Entity”), including, without limitation, those relating
to environmental laws and regulations.
2.4.3.
Prior Securities Transactions. No securities of the Company have been sold by the Company or by or on behalf of, or for the benefit
of, any person or persons controlling, controlled by or under common control with the Company, except as disclosed in the Registration
Statement, the Pricing Disclosure Package and the Preliminary Prospectus.
2.4.4.
Regulations. The disclosures in the Registration Statement, the Pricing Disclosure Package and the Prospectus concerning the effects
of federal, state, local and all foreign regulation on the Offering and the Company’s business as currently contemplated are correct
in all material respects and no other such regulations are required to be disclosed in the Registration Statement, the Pricing Disclosure
Package and the Prospectus which are not so disclosed.
2.5
Changes After Dates in Registration Statement.
2.5.1.
No Material Adverse Change. Since the respective dates as of which information is given in the Registration Statement, the Pricing
Disclosure Package and the Prospectus, except as otherwise specifically stated therein: (i) there has been no material adverse change
in the financial position or results of operations of the Company, nor any change or development that, singularly or in the aggregate,
would involve a material adverse change or a prospective material adverse change, in or affecting the condition (financial or otherwise),
results of operations, business, assets or prospects of the Company (a “Material Adverse Change”); (ii) there have been no
material transactions entered into by the Company, other than as contemplated pursuant to this Agreement; and (iii) no officer or director
of the Company has resigned from any position with the Company.
2.5.2.
Recent Securities Transactions, etc. Subsequent to the respective dates as of which information is given in the Registration Statement,
the Pricing Disclosure Package and the Prospectus, and except as may otherwise be indicated or contemplated herein or disclosed in the
Registration Statement, the Pricing Disclosure Package and the Prospectus, the Company has not: (i) issued any securities or incurred
any liability or obligation, direct or contingent, for borrowed money; or (ii) declared or paid any dividend or made any other distribution
on or in respect to its capital stock.
2.5.3.
Disclosures in Commission Filings. Since May 17, 2021 , (i) none of the Company’s filings with the Commission contained
any untrue statement of a material fact or omitted 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; and (ii) the Company has made all filings with the Commission
required under the Exchange Act and the rules and regulations of the Commission promulgated thereunder (the “Exchange Act Regulations”).
2.6
Independent Accountants. To the knowledge of the Company, Mayer Hoffman McCann P.C. (the “Auditor”), whose report
is filed with the Commission as part of the Registration Statement, the Pricing Disclosure Package and the Prospectus, is an independent
registered public accounting firm as required by the Securities Act and the Securities Act Regulations and the Public Company Accounting
Oversight Board. The Auditor has not, during the periods covered by the financial statements included in the Registration Statement,
the Pricing Disclosure Package and the Prospectus, provided to the Company any non-audit services, as such term is used in Section 10A(g)
of the Exchange Act.
2.7
Financial Statements, etc. The financial statements, including the notes thereto and supporting schedules included or incorporated
by reference in the Registration Statement, the Pricing Disclosure Package and the Prospectus, fairly present the financial position
and the results of operations of the Company at the dates and for the periods to which they apply; and such financial statements have
been prepared in conformity with U.S. generally accepted accounting principles (“GAAP”), consistently applied throughout
the periods involved (provided that unaudited interim financial statements are subject to year-end audit adjustments that are not expected
to be material in the aggregate and do not contain all footnotes required by GAAP); and the supporting schedules included or incorporated
by reference in the Registration Statement present fairly the information required to be stated therein. Except as included therein,
no historical or pro forma financial statements are required to be included in the Registration Statement, the Pricing Disclosure Package
or the Prospectus under the Securities Act or the Securities Act Regulations. The pro forma financial information and the related notes,
if any, included or incorporated by reference in the Registration Statement, the Pricing Disclosure Package and the Prospectus have been
properly compiled and prepared in accordance with the applicable requirements of the Securities Act, the Securities Act Regulations,
the Exchange Act or the Exchange Act Regulations and present fairly the information shown therein, and the assumptions used in the preparation
thereof are reasonable and the adjustments used therein are appropriate to give effect to the transactions and circumstances referred
to therein. All disclosures contained in the Registration Statement, the Pricing Disclosure Package or the Prospectus, or incorporated
or deemed incorporated by reference therein, regarding “non-GAAP financial measures” (as such term is defined by the rules
and regulations of the Commission), if any, comply with Regulation G of the Exchange Act and Item 10 of Regulation S-K of the Securities
Act, to the extent applicable. Each of the Registration Statement, the Pricing Disclosure Package and the Prospectus discloses all material
off-balance sheet transactions, arrangements, obligations (including contingent obligations), and other relationships of the Company
with unconsolidated entities or other persons that may have a material current or future effect on the Company’s financial condition,
changes in financial condition, results of operations, liquidity, capital expenditures, capital resources, or significant components
of revenues or expenses. Except as disclosed in the Registration Statement, the Pricing Disclosure Package and the Prospectus, (a) neither
the Company nor any of its direct and indirect subsidiaries, including each entity disclosed or described in the Registration Statement,
the Pricing Disclosure Package and the Prospectus as being a subsidiary of the Company (each, a “Subsidiary” and, collectively,
the “Subsidiaries”), has incurred any material liabilities or obligations, direct or contingent, or entered into any material
transactions other than in the ordinary course of business, (b) the Company has not declared or paid any dividends or made any distribution
of any kind with respect to its capital stock, (c) there has not been any change in the capital stock of the Company or any of its Subsidiaries,
or, other than in the course of business, any grants under any stock compensation plan, and (d) there has not been any material adverse
change in the Company’s long-term or short-term debt.
2.8
Authorized Capital; Options, etc. The Company had, at the date or dates indicated in the Registration Statement, the Pricing Disclosure
Package and the Prospectus, the duly authorized, issued and outstanding capitalization as set forth therein. Based on the assumptions
stated in the Registration Statement, the Pricing Disclosure Package and the Prospectus, the Company will have on the Closing Date the
adjusted stock capitalization set forth therein. Except as set forth in, or contemplated by, the Registration Statement, the Pricing
Disclosure Package and the Prospectus, on the Effective Date, as of the Applicable Time and on the Closing Date and any Option Closing
Date, there will be no stock options, warrants, or other rights to purchase or otherwise acquire any authorized, but unissued shares
of Common Stock of the Company or any security convertible or exercisable into shares of Common Stock of the Company, or any contracts
or commitments to issue or sell shares of Common Stock or any such options, warrants, rights or convertible securities.
2.9
Valid Issuance of Securities, etc.
2.9.1.
Outstanding Securities. All issued and outstanding securities of the Company issued prior to the transactions contemplated by
this Agreement have been duly authorized and validly issued and are fully paid and non-assessable; the holders thereof have no rights
of rescission with respect thereto, and are not subject to personal liability by reason of being such holders; and none of such securities
were issued in violation of the preemptive rights of any holders of any security of the Company or similar contractual rights granted
by the Company. The authorized shares of Common Stock conform in all material respects to all statements relating thereto contained in
the Registration Statement, the Pricing Disclosure Package and the Prospectus. The offers and sales of the outstanding shares of Common
Stock were at all relevant times either registered under the Securities Act and the applicable state securities or “blue sky”
laws or, based in part on the representations and warranties of the purchasers of such shares, exempt from such registration requirements.
2.9.2.
Securities Sold Pursuant to this Agreement. The Public Securities and Representative’s Securities have been duly authorized
for issuance and sale and, when issued and paid for, will be validly issued, fully paid and non-assessable; the holders thereof are not
and will not be subject to personal liability by reason of being such holders; the Public Securities and Representative’s Securities
are not and will not be subject to the preemptive rights of any holders of any security of the Company or similar contractual rights
granted by the Company; and all corporate action required to be taken for the authorization, issuance and sale of the Public Securities
and Representative’s Securities has been duly and validly taken. The Public Securities and Representative’s Securities conform
in all material respects to all statements with respect thereto contained in the Registration Statement, the Pricing Disclosure Package
and the Prospectus. All corporate action required to be taken for the authorization, issuance and sale of the Representative’s
Warrant Agreement has been duly and validly taken; the shares of Common Stock issuable upon exercise of the Pre-Funded Warrants and the
Representative’s Warrant (the “Underlying Shares”) have been duly authorized and reserved for issuance by all necessary
corporate action on the part of the Company and when paid for and issued in accordance with the Pre-Funded Warrant Certificate and the
Representative’s Warrant Agreement, as the case may be, such Underlying Shares will be validly issued, fully paid and non-assessable;
the holders thereof are not and will not be subject to personal liability by reason of being such holders; and such shares of Common
Stock are not and will not be subject to the preemptive rights of any holders of any security of the Company or similar contractual rights
granted by the Company.
2.10
Registration Rights of Third Parties. Except as set forth in the Registration Statement, the Pricing Disclosure Package and the
Prospectus, no holders of any securities of the Company or any rights exercisable for or convertible or exchangeable into securities
of the Company have the right to require the Company to register any such securities of the Company under the Securities Act or to include
any such securities in a registration statement to be filed by the Company.
2.11
Validity and Binding Effect of Agreements. This Agreement, the Pre-Funded Warrant Certificate and the Representative’s Warrant
Agreement have been duly and validly authorized by the Company, and, when executed and delivered, will constitute, the valid and binding
agreements of the Company, enforceable against the Company in accordance with their respective terms, except: (i) as such enforceability
may be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally; (ii) as enforceability
of any indemnification or contribution provision may be limited under the federal and state securities laws; and (iii) that the remedy
of specific performance and injunctive and other forms of equitable relief may be subject to the equitable defenses and to the discretion
of the court before which any proceeding therefor may be brought.
2.12
No Conflicts, etc. The execution, delivery and performance by the Company of this Agreement, the Pre-Funded Warrant Certificate
and the Representative’s Warrant Agreement and all ancillary documents, the consummation by the Company of the transactions herein
and therein contemplated and the compliance by the Company with the terms hereof and thereof do not and will not, with or without the
giving of notice or the lapse of time or both: (i) result in a breach of, or conflict with any of the terms and provisions of, or constitute
a default under, or result in the creation, modification, termination or imposition of any lien, charge or encumbrance upon any property
or assets of the Company pursuant to the terms of any agreement or instrument to which the Company is a party; (ii) result in any violation
of the provisions of the Company’s Certificate of Incorporation (as the same may be amended or restated from time to time, the
“Charter”) or the by-laws (as the same may be amended or restated from time to time, the “By-laws”) of the Company;
or (iii) violate any existing applicable law, rule, regulation, judgment, order or decree of any Governmental Entity as of the date hereof
(including, without limitation, those promulgated by the Food and Drug Administration of the U.S. Department of Health and Human Services
(the “FDA”) or by any foreign, federal, state or local regulatory authority performing functions similar to those performed
by the FDA), except in the case of clauses (i) and (iii) for any such breach, conflict, violation default, lien, charge or encumbrance
that would not reasonably be expected to result in, individually or in the aggregate, a Material Adverse Change.
2.13
No Defaults; Violations. No material default exists in the due performance and observance of any term, covenant or condition of
any material license, contract, indenture, mortgage, deed of trust, note, loan or credit agreement, or any other agreement or instrument
evidencing an obligation for borrowed money, or any other material agreement or instrument to which the Company is a party or by which
the Company may be bound or to which any of the properties or assets of the Company is subject. The Company is not (i) in violation of
any term or provision of its Charter or By-laws, (ii) in violation of any franchise, license or permit or (iii) any violation of applicable
law, rule, regulation, judgment or decree of any Governmental Entity except in the case of clause (ii) for any such violation that would
not reasonably be expected to result in, individually or in the aggregate, a Material Adverse Change.
2.14
Corporate Power; Licenses; Consents.
2.14.1.
Conduct of Business. Except as described in the Registration Statement, the Pricing Disclosure Package and the Prospectus, the
Company has all requisite corporate power and authority, and has all necessary authorizations, approvals, orders, licenses, certificates
and permits of and from all governmental regulatory officials and bodies that it needs as of the date hereof to conduct its business
purpose as described in the Registration Statement, the Pricing Disclosure Package and the Prospectus.
2.14.2.
Transactions Contemplated Herein. The Company has all corporate power and authority to enter into this Agreement, the Pre-Funded
Warrant Certificate and the Representative’s Warrant Agreement, and to carry out the provisions and conditions hereof, and all
consents, authorizations, approvals and orders required in connection therewith have been obtained. No consent, authorization or order
of, and no filing with, any court, government agency or other body is required for the valid issuance, sale and delivery of the Public
Securities and the consummation of the transactions and agreements contemplated by this Agreement, the Pre-Funded Warrant Certificate
and the Representative’s Warrant Agreement and as contemplated by the Registration Statement, the Pricing Disclosure Package and
the Prospectus, except (i) such consents, approvals, authorizations, orders, filings, registrations or qualifications that have already
been obtained or made and (ii) with respect to applicable federal and state securities laws and the rules and regulations of the Financial
Industry Regulatory Authority, Inc. (“FINRA”).
2.15
D&O Questionnaires. To the Company’s knowledge, all information contained in the questionnaires (the “Questionnaires”)
completed by each of the Company’s directors and officers immediately prior to the Offering (the “Insiders”) as supplemented
by all information concerning the Company’s directors, officers and principal stockholders as described in the Registration Statement,
the Pricing Disclosure Package and the Prospectus, as well as in the Lock-Up Agreement (as defined in Section 2.24 below), provided to
the Underwriters, is true and correct in all material respects and the Company has not become aware of any information which would cause
the information disclosed in the Questionnaires to become materially inaccurate and incorrect.
2.16
Litigation; Governmental Proceedings. There is no action, suit, proceeding, inquiry, arbitration, investigation, litigation or
governmental proceeding pending or, to the Company’s knowledge, threatened against, or involving the Company or, to the Company’s
knowledge, any executive officer or director which has not been disclosed in the Registration Statement, the Pricing Disclosure Package
and the Prospectus or in connection with the Company’s listing application for the listing of the Public Securities on the Exchange.
2.17
Good Standing. The Company has been duly organized and is validly existing as a corporation and is in good standing under the
laws of the State of Delaware as of the date hereof, and is duly qualified to do business and is in good standing in each other jurisdiction
in which its ownership or lease of property or the conduct of business requires such qualification, except where the failure to be in
good standing or to be so qualified, singularly or in the aggregate, would not reasonably be expected to result in a Material Adverse
Change.
2.18
Insurance. The Company carries or is entitled to the benefits of insurance, with reputable insurers, in such amounts and covering
such risks which the Company believes are adequate, including, but not limited to, directors and officers insurance coverage at least
equal to $3,000,000 and the Company has included each Underwriter as an additional insured party to the directors and officers insurance
coverage and all such insurance is in full force and effect. The Company has no reason to believe that it will not be able (i) to renew
its existing insurance coverage as and when such policies expire or (ii) to obtain comparable coverage from similar institutions as may
be necessary or appropriate to conduct its business as now conducted and at a cost that would not result in a Material Adverse Change.
2.19
Transactions Affecting Disclosure to FINRA.
2.19.1.
Finder’s Fees. Except as described in the Registration Statement, the Pricing Disclosure Package and the Prospectus, there
are no claims, payments, arrangements, agreements or understandings relating to the payment of a finder’s, consulting or origination
fee by the Company or any Insider with respect to the sale of the Public Securities hereunder or any other arrangements, agreements or
understandings of the Company or, to the Company’s knowledge, any of its stockholders that may affect the Underwriters’ compensation,
as determined by FINRA.
2.19.2.
Payments Within Twelve (12) Months. Except as described in the Registration Statement, the Pricing Disclosure Package and the
Prospectus, the Company has not made any direct or indirect payments (in cash, securities or otherwise) to: (i) any person, as a finder’s
fee, consulting fee or otherwise, in consideration of such person raising capital for the Company or introducing to the Company persons
who raised or provided capital to the Company; (ii) any FINRA member; or (iii) any person or entity that has any direct or indirect affiliation
or association with any FINRA member, within the twelve (12) months prior to the date of this Agreement, other than the payment to the
Underwriters as provided hereunder in connection with the Offering.
2.19.3.
Use of Proceeds. None of the net proceeds of the Offering will be paid by the Company to any participating FINRA member or its
affiliates, except as specifically authorized herein.
2.19.4.
FINRA Affiliation. There is no (i) officer or director of the Company, (ii) beneficial owner of 5% or more of any class of the
Company’s securities or (iii) beneficial owner of the Company’s unregistered equity securities which were acquired during
the 180-day period immediately preceding the filing of the Registration Statement that is an affiliate or associated person of a FINRA
member participating in the Offering (as determined in accordance with the rules and regulations of FINRA).
2.19.5.
Information. All information provided by the Company in its, and, to the Company’s knowledge, all information provided by
the Company’s officers and directors in their, FINRA questionnaire to Representative Counsel specifically for use by Representative
Counsel in connection with its Public Offering System filings (and related disclosure) with FINRA is true, correct and complete in all
material respects.
2.20
Foreign Corrupt Practices Act. None of the Company and its Subsidiaries or, to the Company’s knowledge, any director, officer,
agent, employee or affiliate of the Company and its Subsidiaries or any other person acting on behalf of the Company and its Subsidiaries,
has, directly or indirectly, given or agreed to give any money, gift or similar benefit (other than legal price concessions to customers
in the ordinary course of business) to any customer, supplier, employee or agent of a customer or supplier, or official or employee of
any governmental agency or instrumentality of any government (domestic or foreign) or any political party or candidate for office (domestic
or foreign) or other person who was, is, or may be in a position to help or hinder the business of the Company (or assist it in connection
with any actual or proposed transaction) that (i) might subject the Company to any damage or penalty in any civil, criminal or governmental
litigation or proceeding, (ii) if not given in the past, might have had a Material Adverse Change or (iii) if not continued in the future,
might adversely affect the assets, business, operations or prospects of the Company. The Company has taken reasonable steps to ensure
that its accounting controls and procedures are sufficient to cause the Company to comply in all material respects with the Foreign Corrupt
Practices Act of 1977, as amended.
2.21
Compliance with OFAC. None of the Company and its Subsidiaries or, to the Company’s knowledge, any director, officer, agent,
employee or affiliate of the Company and its Subsidiaries or any other person acting on behalf of the Company and its Subsidiaries, is
currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury (“OFAC”),
and the Company will not, directly or indirectly, use the proceeds of the Offering hereunder, or lend, contribute or otherwise make available
such proceeds to any subsidiary, joint venture partner or other person or entity, for the purpose of financing the activities of any
person currently subject to any U.S. sanctions administered by OFAC.
2.22
Money Laundering Laws. The operations of the Company and its Subsidiaries are and have been conducted at all times in compliance
with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as
amended, the money laundering statutes of all jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations
or guidelines, issued, administered or enforced by any Governmental Entity (collectively, the “Money Laundering Laws”); and
no action, suit or proceeding by or before any Governmental Entity involving the Company with respect to the Money Laundering Laws is
pending or, to the best knowledge of the Company, threatened.
2.23
Officers’ Certificate. Any certificate signed by any duly authorized officer of the Company and delivered to you or to Representative
Counsel shall be deemed a representation and warranty by the Company to the Underwriters as to the matters covered thereby.
2.24
Lock-Up Agreements. Schedule 3 hereto contains a complete and accurate list of the Company’s officers and directors (collectively,
the “Lock-Up Parties”). The Company has caused each of the Lock-Up Parties to deliver to the Representative an executed Lock-Up
Agreement, in the form attached hereto as Exhibit C (the “Lock-Up Agreement”), prior to the execution of this Agreement.
2.25
Subsidiaries. All direct and indirect Subsidiaries of the Company are duly organized and in good standing under the laws of the
place of organization or incorporation, and each Subsidiary is in good standing in each jurisdiction in which its ownership or lease
of property or the conduct of business requires such qualification, except where the failure to qualify would not result in a Material
Adverse Change. The Company’s ownership and control of each Subsidiary is as described in the Registration Statement, the Pricing
Disclosure Package and the Prospectus.
2.26
Related Party Transactions. There are no business relationships or related party transactions involving the Company or any other
person required to be described in the Registration Statement, the Pricing Disclosure Package and the Prospectus that have not been described
as required.
2.27
Board of Directors. The Board of Directors of the Company is comprised of the persons set forth under the heading of the Pricing
Prospectus and the Prospectus captioned “Management.” The qualifications of the persons serving as board members and the
overall composition of the board comply with the Exchange Act, the Exchange Act Regulations, the Sarbanes-Oxley Act of 2002 and the rules
promulgated thereunder (the “Sarbanes-Oxley Act”) applicable to the Company and the listing rules of the Exchange. At least
one member of the Audit Committee of the Board of Directors of the Company qualifies as an “audit committee financial expert,”
as such term is defined under Regulation S-K and the listing rules of the Exchange. In addition, at least a majority of the persons serving
on the Board of Directors qualify as “independent,” as defined under the listing rules of the Exchange.
2.28
Sarbanes-Oxley Compliance.
2.28.1.
Disclosure Controls. The Company has taken all necessary actions to ensure that, the Company complies with Rule 13a-15 or 15d-15
under the Exchange Act Regulations, and such controls and procedures are effective to ensure that all material information concerning
the Company will be made known on a timely basis to the individuals responsible for the preparation of the Company’s Exchange Act
filings and other public disclosure documents.
2.28.2.
Compliance. The Company is, and on the Closing Date will be, in material compliance with the provisions of the Sarbanes-Oxley
Act applicable to it, and has implemented or will implement such programs and taken reasonable steps to ensure the Company’s future
compliance (not later than the relevant statutory and regulatory deadlines therefor) with all of the material provisions of the Sarbanes-Oxley
Act then applicable to it.
2.29
Accounting Controls. The Company and its Subsidiaries maintain systems of “internal control over financial reporting”
(as defined under Rules 13a-15 and 15d-15 under the Exchange Act Regulations) that comply with the requirements of the Exchange Act and
have been designed by, or under the supervision of, their respective principal executive and principal financial officers, or persons
performing similar functions, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with GAAP, including, but not limited to, internal accounting controls sufficient
to provide reasonable assurance that (i) transactions are executed in accordance with management’s general or specific authorizations;
(ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain asset
accountability; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; and
(iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken
with respect to any differences. Except as disclosed in the Registration Statement, the Pricing Disclosure Package and the Prospectus,
the Company is not aware of any material weaknesses in its internal controls. The Company’s auditors and the Audit Committee of
the Board of Directors of the Company have been advised of: (i) all significant deficiencies and material weaknesses in the design or
operation of internal controls over financial reporting which are known to the Company’s management and that have adversely affected
or are reasonably likely to adversely affect the Company’ ability to record, process, summarize and report financial information;
and (ii) any fraud known to the Company’s management, whether or not material, that involves management or other employees who
have a significant role in the Company’s internal controls over financial reporting.
2.30
No Investment Company Status. The Company is not and, after giving effect to the Offering and the application of the proceeds
thereof as described in the Registration Statement, the Pricing Disclosure Package and the Prospectus, will not be, required to register
as an “investment company,” as defined in the Investment Company Act of 1940, as amended.
2.31
No Labor Disputes. No labor dispute with the employees of the Company or any of its Subsidiaries exists or, to the knowledge of
the Company, is imminent.
2.32
Intellectual Property Rights. The Company and each of its Subsidiaries owns or possesses or has valid rights to use all patents,
patent applications, trademarks, service marks, trade names, trademark registrations, service mark registrations, copyrights, licenses,
inventions, trade secrets and similar rights (“Intellectual Property Rights”) necessary for the conduct of the business of
the Company and its Subsidiaries as currently carried on and as described in the Registration Statement, the Pricing Disclosure Package
and the Prospectus. To the knowledge of the Company, no action or use by the Company or any of its Subsidiaries necessary for the conduct
of its business as currently carried on and as described in the Registration Statement and the Prospectus will involve or give rise to
any infringement of, or license or similar fees for, any Intellectual Property Rights of others. Neither the Company nor any of its Subsidiaries
has received any notice alleging any such infringement, fee or conflict with asserted Intellectual Property Rights of others. Except
as would not reasonably be expected to result, individually or in the aggregate, in a Material Adverse Change (A) to the knowledge of
the Company, there is no infringement, misappropriation or violation by third parties of any of the Intellectual Property Rights owned
by the Company; (B) there is no pending or, to the knowledge of the Company, threatened action, suit, proceeding or claim by others challenging
the rights of the Company in or to any such Intellectual Property Rights, and the Company is unaware of any facts which would form a
reasonable basis for any such claim, that would, individually or in the aggregate, together with any other claims in this Section 2.32,
reasonably be expected to result in a Material Adverse Change; (C) the Intellectual Property Rights owned by the Company and, to the
knowledge of the Company, the Intellectual Property Rights licensed to the Company have not been adjudged by a court of competent jurisdiction
invalid or unenforceable, in whole or in part, and 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 Rights, and the Company is unaware
of any facts which would form a reasonable basis for any such claim that would, individually or in the aggregate, together with any other
claims in this Section 2.32, reasonably be expected to result in a Material Adverse Change; (D) there is no pending or, to the Company’s
knowledge, threatened action, suit, proceeding or claim by others that the Company infringes, misappropriates or otherwise violates any
Intellectual Property Rights or other proprietary rights of others, the Company has not received any written notice of such claim and
the Company is unaware of any other facts which would form a reasonable basis for any such claim that would, individually or in the aggregate,
together with any other claims in this Section 2.32, reasonably be expected to result in a Material Adverse Change; and (E) to the Company’s
knowledge, no employee of the Company is in or has ever been in violation in any material respect of any term of any employment contract,
patent disclosure agreement, invention assignment agreement, non-competition agreement, non-solicitation agreement, nondisclosure agreement
or any restrictive covenant to or with a former employer where the basis of such violation relates to such employee’s employment
with the Company, or actions undertaken by the employee while employed with the Company and could reasonably be expected to result, individually
or in the aggregate, in a Material Adverse Change. To the Company’s knowledge, all material technical information developed by
and belonging to the Company which has not been patented has been kept confidential. The Company is not a party to or bound by any options,
licenses or agreements with respect to the Intellectual Property Rights of any other person or entity that are required to be set forth
in the Registration Statement, the Pricing Disclosure Package and the Prospectus and are not described therein. The Registration Statement,
the Pricing Disclosure Package and the Prospectus contain in all material respects the same description of the matters set forth in the
preceding sentence. None of the technology employed by the Company has been obtained or is being used by the Company in violation of
any contractual obligation binding on the Company or, to the Company’s knowledge, any of its officers, directors or employees,
or otherwise in violation of the rights of any persons.
To
the Company’s knowledge, all licenses for the use of the Intellectual Property described in the Registration Statement, the Pricing
Disclosure Package and the Prospectus are in full force and effect in all material respects and are enforceable by the Company and, to
the Company’s knowledge, the other parties thereto, in accordance with their terms, except (x) as such enforceability may be limited
by bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally, (y) as enforceability of any indemnification
or contribution provision may be limited under the federal and state securities laws, and (z) that the remedy of specific performance
and injunctive and other forms of equitable relief may be subject to the equitable defenses and to the discretion of the court before
which any proceeding therefor may be brought. None of such agreements or instruments has been assigned by the Company, and the Company,
has no knowledge, that any other party is in default thereunder and no event has occurred that, with the lapse of time or the giving
of notice, or both, would constitute a default thereunder.
2.33
Taxes. Each of the Company and its Subsidiaries has (i) filed all returns (as hereinafter defined) required to be filed with taxing
authorities prior to the date hereof or has duly obtained extensions of time for the filing thereof and (ii) has paid all taxes (as hereinafter
defined) shown as due on such returns that were filed and has paid all taxes imposed on or assessed against the Company or such respective
Subsidiary except as currently being contested in good faith and for which reserves required by GAAP have been created in the financial
statements of the Company. The provisions for taxes payable, if any, shown on the financial statements filed with or as part of the Registration
Statement are sufficient for all accrued and unpaid taxes, whether or not disputed, and for all periods to and including the dates of
such consolidated financial statements. Except as disclosed in writing to the Underwriters, (i) no issues have been raised (and are currently
pending) by any taxing authority in connection with any of the returns or taxes asserted as due from the Company or its Subsidiaries,
and (ii) no waivers of statutes of limitation with respect to the returns or collection of taxes have been given by or requested from
the Company or its Subsidiaries. The term “taxes” means all federal, state, local, foreign and other net income, gross income,
gross receipts, sales, use, ad valorem, transfer, franchise, profits, license, lease, service, service use, withholding, payroll, employment,
excise, severance, stamp, occupation, premium, property, windfall profits, customs, duties or other taxes, fees, assessments or charges
of any kind whatever, together with any interest and any penalties, additions to tax or additional amounts with respect thereto. The
term “returns” means all returns, declarations, reports, statements and other documents required to be filed in respect to
taxes.
2.34
ERISA Compliance. The Company and any “employee benefit plan” (as defined under the Employee Retirement Income Security
Act of 1974, as amended, and the regulations and published interpretations thereunder (collectively, “ERISA”)) established
or maintained by the Company or its “ERISA Affiliates” (as defined below) are in compliance in all material respects with
ERISA. “ERISA Affiliate” means, with respect to the Company, any member of any group of organizations described in Sections
414(b),(c),(m) or (o) of the Internal Revenue Code of 1986, as amended, and the regulations and published interpretations thereunder
(the “Code”) of which the Company is a member. No “reportable event” (as defined under ERISA) has occurred or
is reasonably expected to occur with respect to any “employee benefit plan” established or maintained by the Company or any
of its ERISA Affiliates. No “employee benefit plan” established or maintained by the Company or any of its ERISA Affiliates,
if such “employee benefit plan” were terminated, would have any “amount of unfunded benefit liabilities” (as
defined under ERISA). Neither the Company nor any of its ERISA Affiliates has incurred or reasonably expects to incur any material liability
under (i) Title IV of ERISA with respect to termination of, or withdrawal from, any “employee benefit plan” or (ii) Sections
412, 4971, 4975 or 4980B of the Code. Each “employee benefit plan” established or maintained by the Company or any of its
ERISA Affiliates that is intended to be qualified under Section 401(a) of the Code is so qualified and, to the knowledge of the Company,
nothing has occurred, whether by action or failure to act, which would cause the loss of such qualification.
2.35
Compliance with Laws. The Company: (A) is and at all times has been in compliance with all statutes, rules, or regulations applicable
to the ownership, testing, development, manufacture, packaging, processing, use, distribution, marketing, labeling, promotion, sale,
offer for sale, storage, import, export or disposal of any product manufactured or distributed by the Company (“Applicable Laws”),
except as could not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Change; (B) has not received
any warning letter, untitled letter or other correspondence or notice from any other governmental authority alleging or asserting noncompliance
with any Applicable Laws or any licenses, certificates, approvals, clearances, authorizations, permits and supplements or amendments
thereto required by any such Applicable Laws (“Authorizations”); (C) possesses all material Authorizations and such Authorizations
are valid and in full force and effect and are not in material violation of any term of any such Authorizations; (D) has not received
notice of any claim, action, suit, proceeding, hearing, enforcement, investigation, arbitration or other action from any governmental
authority or third party alleging that any product operation or activity is in violation of any Applicable Laws or Authorizations and
has no knowledge that any such governmental authority or third party is considering any such claim, litigation, arbitration, action,
suit, investigation or proceeding; (E) has not received notice that any governmental authority has taken, is taking or intends to take
action to limit, suspend, modify or revoke any Authorizations and has no knowledge that any such governmental authority is considering
such action; (F) has filed, obtained, maintained or submitted all material 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 correct on the date filed
(or were corrected or supplemented by a subsequent submission); and (G) has not, either voluntarily or involuntarily, initiated, conducted,
or issued or caused to be initiated, conducted or issued, any recall, market withdrawal or replacement, safety alert, post-sale warning,
“dear doctor” letter, or other notice or action relating to the alleged lack of safety or efficacy of any product or any
alleged product defect or violation and, to the Company’s knowledge, no third party has initiated, conducted or intends to initiate
any such notice or action.
2.36
Ineligible Issuer. At the time of filing the Registration Statement and any post-effective amendment thereto, at the time of effectiveness
of the Registration Statement and any amendment thereto, at the earliest time thereafter that the Company or another offering participant
made a bona fide offer (within the meaning of Rule 164(h)(2) of the Securities Act Regulations) of the Public Securities and at the date
hereof, 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.
2.37
Real Property. Except as set forth in the Registration Statement, the Pricing Disclosure Package and the Prospectus, the Company
and its Subsidiaries have good and marketable title in fee simple to, or have valid rights to lease or otherwise use, all items of real
or personal property which are material to the business of the Company and its Subsidiaries taken as a whole, in each case free and clear
of all liens, encumbrances, security interests, claims and defects that do not, singly or in the aggregate, materially affect the value
of such property and do not interfere with the use made and proposed to be made of such property by the Company or its Subsidiaries;
and all of the leases and subleases material to the business of the Company and its subsidiaries, considered as one enterprise, and under
which the Company or any of its Subsidiaries holds properties described in the Registration Statement, the Pricing Disclosure Package
and the Prospectus, are in full force and effect, and neither the Company nor any Subsidiary has received any notice of any material
claim of any sort that has been asserted by anyone adverse to the rights of the Company or any Subsidiary under any of the leases or
subleases mentioned above, or affecting or questioning the rights of the Company or such Subsidiary to the continued possession of the
leased or subleased premises under any such lease or sublease.
2.38
Contracts Affecting Capital. There are no transactions, arrangements or other relationships between and/or among the Company,
any of its affiliates (as such term is defined in Rule 405 of the Securities Act Regulations) and any unconsolidated entity, including,
but not limited to, any structured finance, special purpose or limited purpose entity that could reasonably be expected to materially
affect the Company’s or its Subsidiaries’ liquidity or the availability of or requirements for their capital resources required
to be described in the Registration Statement, the Pricing Disclosure Package and the Prospectus which have not been described as required.
2.39
Loans to Directors or Officers. There are no outstanding loans, advances (except normal advances for business expenses in the
ordinary course of business) or guarantees or indebtedness by the Company or its Subsidiaries to or for the benefit of any of the officers
or directors of the Company, its Subsidiaries or any of their respective family members, except as disclosed in the Registration Statement,
the Pricing Disclosure Package and the Prospectus.
2.40
Smaller Reporting Company. As of the time of filing of the Registration Statement, the Company was a “smaller reporting
company,” as defined in Rule 12b-2 of the Exchange Act Regulations.
2.41
Industry Data. The statistical and market-related data included in each of the Registration Statement, the Pricing Disclosure
Package and the Prospectus are based on or derived from sources that the Company reasonably and in good faith believes are reliable and
accurate or represent the Company’s good faith estimates that are made on the basis of data derived from such sources.
2.42
Forward Looking Statements. No forward-looking statement (within the meaning of Section 27A of the Securities Act and Section
21E of the Exchange Act) contained in either the Registration Statement, Pricing Disclosure Package or Prospectus has been made or reaffirmed
without a reasonable basis or has been disclosed other than in good faith.
2.43
Emerging Growth Company. From the time of the initial confidential submission of the Registration Statement to the Commission
(or, if earlier, the first date on which the Company engaged directly in or through any Person authorized to act on its behalf in any
Testing-the Waters Communication) through the date hereof, the Company has been and is an “emerging growth company,” as defined
in Section 2(a) of the Securities Act (an “Emerging Growth Company”). “Testing-the-Waters Communication” means
any oral or written communication with potential investors undertaken in reliance on Section 5(d) of the Securities Act.
2.44
Testing-the-Waters Communications. The Company has not (i) alone engaged in any Testing-the-Waters Communications, other than
Testing-the-Waters Communications with the written consent of the Representative and with entities that are qualified institutional buyers
within the meaning of Rule 144A under the Securities Act or institutions that are accredited investors within the meaning of Rule 501
under the Securities Act and (ii) authorized anyone other than the Representative to engage in Testing-the-Waters Communications. The
Company confirms that the Representative has been authorized to act on its behalf in undertaking Testing-the-Waters Communications. The
Company has not distributed any Written Testing-the-Waters Communications other than those listed on Schedule 2-C hereto. “Written
Testing-the-Waters Communication” means any Testing-the-Waters Communication that is a written communication within the meaning
of Rule 405 under the Securities Act.
2.45
Electronic Road Show. The Company has made available a Bona Fide Electronic Road Show in compliance with Rule 433(d)(8)(ii) of
the Securities Act Regulations such that no filing of any “road show” (as defined in Rule 433(h) of the Securities Act Regulations)
is required in connection with the Offering.
2.46
Margin Securities. The Company owns no “margin securities” as that term is defined in Regulation U of the Board of
Governors of the Federal Reserve System (the “Federal Reserve Board”), and none of the proceeds of Offering will be used,
directly or indirectly, for the purpose of purchasing or carrying any margin security, for the purpose of reducing or retiring any indebtedness
which was originally incurred to purchase or carry any margin security or for any other purpose which might cause any of the shares of
Common Stock to be considered a “purpose credit” within the meanings of Regulation T, U or X of the Federal Reserve Board.
2.47
Health Care Laws. As to each product subject to the jurisdiction of the FDA or any non-U.S. counterpart that is manufactured,
packaged, labeled, tested, distributed, sold, and/or marketed by the Company or any of its Subsidiaries (each such product, a “Product”),
such Product is being manufactured, packaged, labeled, tested, distributed, sold and/or marketed by the Company or its Subsidiaries in
material compliance with all applicable Health Care Laws relating to registration, investigational use, premarket clearance, licensure,
or application approval, good manufacturing practices, good laboratory practices, good clinical practices, product listing, quotas, labeling,
advertising, record keeping and filing of reports. There is no pending, completed or, to the Company’s knowledge, threatened, action
(including any lawsuit, arbitration, or legal or administrative or regulatory proceeding, charge, complaint, or investigation) against
the Company or any of its Subsidiaries, and none of the Company or any of its Subsidiaries has received any notice, warning letter or
other communication from the FDA or any other governmental entity, which (i) contests the premarket clearance, licensure, registration,
or approval of, the uses of, the distribution of, the manufacturing or packaging of, the testing of, the sale of, or the labeling and
promotion of any Product, (ii) withdraws its approval of, requests the recall, suspension, or seizure of, or withdraws or orders the
withdrawal of advertising or sales promotional materials relating to, any Product, (iii) imposes a clinical hold on any clinical investigation
by the Company or any of its Subsidiaries, (iv) enjoins production at any facility of the Company or any of its Subsidiaries, (v) enters
or proposes to enter into a consent decree of permanent injunction with the Company or any of its Subsidiaries, or (vi) otherwise alleges
any violation of any laws, rules or regulations by the Company or any of its Subsidiaries, and which, either individually or in the aggregate,
would reasonably be expected to result in a Material Adverse Change. The properties, business and operations of the Company have been
and are being conducted in all material respects in accordance with all applicable Health Care Laws. The Company has not been informed
by the FDA or any non-U.S. counterpart that the FDA or any non-U.S. counterpart will prohibit the marketing, sale, license or use in
the United States or in any other territory any product proposed to be developed, produced or marketed by the Company or any Subsidiary
nor has the FDA or any non-U.S. counterpart expressed any concern as to approving or clearing for marketing any product being developed
or proposed to be developed by the Company or any Subsidiary. For purposes of this Agreement, “Health Care Laws” means: (i)
the Federal Food, Drug, and Cosmetic Act and the regulations promulgated thereunder; (ii) all applicable federal, state, local and all
applicable foreign health care related fraud and abuse laws, including, without limitation, the U.S. Anti-Kickback Statute (42 U.S.C.
Section 1320a-7b(b)), the U.S. Physician Payments Sunshine Act (42 U.S.C. § 1320a-7h), the U.S. Civil False Claims Act (31 U.S.C.
Section 3729 et seq.), the criminal False Claims Law (42 U.S.C. § 1320a-7b(a)), all criminal laws relating to health care fraud
and abuse, including but not limited to 18 U.S.C. Sections 286 and 287, and the health care fraud criminal provisions under the U.S.
Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) (42 U.S.C. Section 1320d et seq.), the exclusion law
(42 U.S.C. § 1320a-7), the civil monetary penalties law (42 U.S.C. § 1320a-7a), the statutes, regulations and directives of
applicable government funded or sponsored healthcare programs, and the regulations promulgated pursuant to such statutes; (iii) HIPAA,
as amended by the Health Information Technology for Economic and Clinical Health Act (42 U.S.C. Section 17921 et seq.), and the regulations
promulgated thereunder and any state or non-U.S. counterpart thereof or other law or regulation the purpose of which is to protect the
privacy of healthcare information; (iv) Medicare (Title XVIII of the Social Security Act); (v) Medicaid (Title XIX of the Social Security
Act); and (vi) any and all other applicable health care laws and regulations.
2.48
Regulatory Filings. Except as disclosed in the Registration Statement, the Pricing Disclosure Package and the Prospectus, neither
the Company nor any of its Subsidiaries has failed to file with the applicable Governmental Authority (including the FDA or any foreign,
federal, state or local Governmental Authority performing functions similar to those performed by the FDA) any required filing, declaration,
listing, registration, report or submission, except for such failures that, individually or in the aggregate, would not reasonably be
expected to result in a Material Adverse Change; except as disclosed in the Registration Statement, the Pricing Disclosure Package and
the Prospectus, all such filings, declarations, listings, registrations, reports or submissions were in material compliance with applicable
laws when filed and no deficiencies have been asserted by any applicable regulatory authority with respect to any such filings, declarations,
listings, registrations, reports or submissions, except for any deficiencies that, individually or in the aggregate, would not result
in a Material Adverse Change. The Company has operated and currently is, in all material respects, in compliance with all applicable
Health Care Laws. The Company has no knowledge of any studies, tests or trials not described in the Registration Statement, the Pricing
Disclosure Package and the Prospectus the results of which reasonably call into question in any material respect the results of the studies,
tests and trials described in the Registration Statement, the Pricing Disclosure Package and the Prospectus.
2.49
Clinical Studies. The preclinical studies and tests and clinical trials described in the Registration Statement, the Pricing Disclosure
Package and the Prospectus were, and, if still pending, are being conducted in all material respects in accordance with the experimental
protocols, procedures and controls pursuant to, where applicable, accepted professional and scientific standards for products or product
candidates comparable to those being developed by the Company; the descriptions of such studies, tests and trials, and the results thereof,
contained in the Registration Statement, the Pricing Disclosure Package and the Prospectus are accurate and complete in all material
respects; the Company is not aware of any tests, studies or trials not described in the Registration Statement, the Pricing Disclosure
Package and the Prospectus, the results of which reasonably call into question the results of the tests, studies and trials described
in the Registration Statement, the Pricing Disclosure Package and the Prospectus; and the Company has not received any written notice
or correspondence from the FDA or any foreign, state or local Governmental Authority exercising comparable authority or any institutional
review board or comparable authority requiring the termination, suspension, clinical hold or material modification of any tests, studies
or trials.
2.50
Environmental Laws. Except as set forth in the Registration Statement, the Pricing Disclosure Package or the Prospectus, the Company
and its Subsidiaries (i) are in compliance with any and all applicable federal, state, local and foreign laws, rules, regulations, decisions
and orders relating to the protection of human health and safety, the environment or hazardous or toxic substances or wastes, pollutants
or contaminants (collectively, “Environmental Laws “); (ii) have received and are in compliance with all permits, licenses
or other approvals required of them under applicable Environmental Laws to conduct their respective businesses as described in the Registration
Statement, the Pricing Disclosure Package or the Prospectus; and (iii) have not received notice of any actual or potential liability
for the investigation or remediation of any disposal or release of hazardous or toxic substances or wastes, pollutants or contaminants,
except, in the case of any of clauses (i), (ii) or (iii) above, for any such failure to comply or failure to receive required permits,
licenses, other approvals or liability as would not, individually or in the aggregate, reasonably be expected to result in a Material
Adverse Change.
2.51
Cybersecurity. The Company and its Subsidiaries’ information technology assets and equipment, computers, systems, networks,
hardware, software, websites, applications, and databases (collectively, “IT Systems”) are adequate for, and operate and
perform in all material respects as required in connection with the operation of the business of the Company and its Subsidiaries as
currently conducted, and, to the knowledge of the Company, free and clear of all material bugs, errors, defects, Trojan horses, time
bombs, malware and other corruptants. The Company and its Subsidiaries have implemented commercially reasonable physical, technical and
administrative controls, policies, procedures, and safeguards to maintain and protect their material confidential information and the
integrity, continuous operation, redundancy and security of all IT Systems and data, including “Personal Data,” used in connection
with their businesses. “Personal Data” means (i) a natural person’s name, street address, telephone number, e-mail
address, photograph, social security number or tax identification number, driver’s license number, passport number, credit card
number, bank information, or customer or account number; (ii) any information which would qualify as “personally identifying information”
under the Federal Trade Commission Act, as amended; (iii) “personal data” as defined by GDPR; (iv) any information which
would qualify as “protected health information” under the Health Insurance Portability and Accountability Act of 1996, as
amended by the Health Information Technology for Economic and Clinical Health Act (collectively, “HIPAA”); and (v) any other
piece of information that allows the identification of such natural person, or his or her family, or permits the collection or analysis
of any data related to an identified person’s health or sexual orientation. Except as disclosed in the Registration Statement,
the Pricing Disclosure Package or the Prospectus, there have been no breaches, violations, outages or unauthorized uses of or accesses
to same, except for those that have been remedied without material cost or liability or the duty to notify any other person, nor any
incidents under internal review or investigations relating to the same. The Company and its Subsidiaries are presently in material 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 Personal Data and to
the protection of such IT Systems and Personal Data from unauthorized use, access, misappropriation or modification.
2.52
Compliance with Data Privacy Laws. The Company and its Subsidiaries are, and at all prior times were, in material compliance with
all applicable state and federal data privacy and security laws and regulations, including without limitation HIPAA, and the Company
and its Subsidiaries are in compliance with the European Union General Data Protection Regulation (“GDPR”) (EU 2016/679)
(collectively, the “Privacy Laws”). To ensure compliance with the Privacy Laws, the Company and its Subsidiaries have in
place, comply with, and take appropriate steps reasonably designed to ensure compliance in all material respects with their policies
and procedures relating to data privacy and security and the collection, storage, use, disclosure, handling, and analysis of Personal
Data (the “Policies”). The Company and its Subsidiaries have, to the knowledge of the Company, at all times made all disclosures
to users or customers required by applicable laws and regulatory rules or requirements, and none of such disclosures made or contained
in any Policy have, to the knowledge of the Company, been inaccurate or in violation of any applicable laws and regulatory rules or requirements
in any material respect. The Company further certifies that neither it nor any Subsidiary: (i) has received notice of any actual or potential
liability under or relating to, or actual or potential violation of, any of the Privacy Laws, and has no knowledge of any event or condition
that would reasonably be expected to result in any such notice; (ii) is currently conducting or paying for, in whole or in part, any
investigation, remediation, or other corrective action pursuant to any Privacy Law; or (iii) is a party to any order, decree, or agreement
that imposes any obligation or liability under any Privacy Law.
2.53
Exchange Act Reports. The Company has filed in a timely manner all reports required to be filed pursuant to Sections 13(a), 13(e),
14 and 15(d) of the Exchange Act during the preceding 12 months (except to the extent that Section 15(d) requires reports to be filed
pursuant to Sections 13(d) and 13(g) of the Exchange Act, which shall be governed by the next clause of this sentence); and the Company
has filed in a timely manner all reports required to be filed pursuant to Sections 13(d) and 13(g) of the Exchange Act since May 17,
2021, except where the failure to timely file could not reasonably be expected, individually or in the aggregate, to have a Material
Adverse Change.
2.54
No Relationships with Customers and Suppliers. No relationship, direct or indirect, exists between or among the Company on the
one hand, and the directors, officers, 5% or greater stockholders, customers or suppliers of the Company or any of the Company’s
affiliates on the other hand, which is required to be described in the Pricing Disclosure Package and the Prospectus or a document incorporated
by reference therein and which is not so described.
2.55
No Unconsolidated Entities. There are no transactions, arrangements or other relationships between and/or among the Company, any
of its affiliates (as such term is defined in Rule 405 of the Securities Act) and any unconsolidated entity, including, but not limited
to, any structured finance, special purpose or limited purpose entity that could reasonably be expected to materially affect the Company’s
liquidity or the availability of or requirements for its capital resources required to be described in the Pricing Disclosure Package
and the Prospectus or a document incorporated by reference therein which have not been described as required.
2.56
Minute Books. The minute books of the Company have been made available to the Underwriters and counsel for the Underwriters, and
such books (i) contain a complete summary of all meetings and actions of the board of directors (including each board committee) and
stockholders of the Company (or analogous governing bodies and interest holders, as applicable), and each of its Subsidiaries since the
time of its respective incorporation or organization through the date of the latest meeting and action, and (ii) accurately in all material
respects reflect all transactions referred to in such minutes. There are no material transactions, agreements, dispositions or other
actions of the Company that are not properly approved and/or accurately and fairly recorded in the minute books of the Company, as applicable.
2.57
Integration. Neither the Company, nor any of its affiliates, nor any person acting on its or their behalf has, directly or indirectly,
made any offers or sales of any security or solicited any offers to buy any security, under circumstances that would cause the Offering
to be integrated with prior offerings by the Company for purposes of the Securities Act that would require the registration of any such
securities under the Securities Act.
2.58
No Stabilization. Neither the Company nor, to its knowledge, any of its employees, directors or stockholders (without the consent
of the Representative) has taken or shall take, directly or indirectly, any action designed to or that has constituted or that might
reasonably be expected to cause or result in, under Regulation M of 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 Public Securities.
2.59
Confidentiality and Non-Competition. To the Company’s knowledge, no director, officer or key employee of the Company is
subject to any confidentiality, non-disclosure, non-competition agreement or non-solicitation agreement with any employer or prior employer
that could reasonably be expected to materially affect his ability to be and act in his respective capacity of the Company or be expected
to result in a Material Adverse Change.
3.
Covenants of the Company. The Company covenants and agrees as follows:
3.1
Amendments to Registration Statement. The Company shall deliver to the Representative, prior to filing, any amendment or supplement
to the Registration Statement or Prospectus proposed to be filed after the Effective Date and not file any such amendment or supplement
to which the Representative shall reasonably object in writing.
3.2
Federal Securities Laws.
3.2.1.
Compliance. The Company, subject to Section 3.2.2, shall comply with the requirements of Rule 430A of the Securities Act Regulations,
and will notify the Representative promptly, and confirm the notice in writing, (i) when any post-effective amendment to the Registration
Statement shall become effective or any amendment or supplement to the Prospectus shall have been filed and when any post-effective amendment
to the Registration Statement shall become effective; (ii) of the receipt of any comments from the Commission; (iii) of any request by
the Commission for any amendment to the Registration Statement or any amendment or supplement to the Prospectus or Pricing Disclosure
Package or for additional information; (iv) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration
Statement or any post-effective amendment or of any order preventing or suspending the use of any Preliminary Prospectus or the Prospectus,
or of the suspension of the qualification of the Public Securities and Representative’s Securities for offering or sale in any
jurisdiction, or of the initiation or threatening of any proceedings for any of such purposes or of any examination pursuant to Section
8(d) or 8(e) of the Securities Act concerning the Registration Statement and (v) if the Company becomes the subject of a proceeding under
Section 8A of the Securities Act in connection with the Offering of the Public Securities and Representative’s Securities. The
Company shall effect all filings required under Rule 424(b) of the Securities Act Regulations, in the manner and within the time period
required by Rule 424(b) (without reliance on Rule 424(b)(8)), and shall take such steps as it deems necessary to ascertain promptly whether
the form of prospectus transmitted for filing under Rule 424(b) was received for filing by the Commission and, in the event that it was
not, it will promptly file such prospectus. The Company shall use its best efforts to prevent the issuance of any stop order, prevention
or suspension and, if any such order is issued, to obtain the lifting thereof at the earliest possible moment.
3.2.2.
Continued Compliance. The Company shall comply with the Securities Act, the Securities Act Regulations, the Exchange Act and the
Exchange Act Regulations so as to permit the completion of the distribution of the Public Securities as contemplated in this Agreement,
the Pre-Funded Warrant Certificate and in the Registration Statement, the Pricing Disclosure Package and the Prospectus. If at any time
when a prospectus relating to the Public Securities is (or, but for the exception afforded by Rule 172 of the Securities Act Regulations
(“Rule 172”), would be) required by the Securities Act to be delivered in connection with sales of the Public Securities,
any event shall occur or condition shall exist as a result of which it is necessary, in the opinion of counsel for the Underwriters or
for the Company, to (i) amend the Registration Statement in order that the Registration Statement will not include an untrue statement
of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading;
(ii) amend or supplement the Pricing Disclosure Package or the Prospectus in order that the Pricing Disclosure Package or the Prospectus,
as the case may be, 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 not misleading in the light of the circumstances existing at the time it is delivered to a purchaser or (iii)
amend the Registration Statement or amend or supplement the Pricing Disclosure Package or the Prospectus, as the case may be, in order
to comply with the requirements of the Securities Act or the Securities Act Regulations, the Company will promptly (A) give the Representative
notice of such event; (B) prepare any amendment or supplement as may be necessary to correct such statement or omission or to make the
Registration Statement, the Pricing Disclosure Package or the Prospectus comply with such requirements and, a reasonable amount of time
prior to any proposed filing or use, furnish the Representative with copies of any such amendment or supplement and (C) file with the
Commission any such amendment or supplement; provided that the Company shall not file or use any such amendment or supplement to which
the Representative or counsel for the Underwriters shall reasonably object. The Company will furnish to the Underwriters such number
of copies of such amendment or supplement as the Underwriters may reasonably request. The Company has given the Representative notice
of any filings made pursuant to the Exchange Act or the Exchange Act Regulations within 48 hours prior to the Applicable Time. The Company
shall give the Representative notice of its intention to make any such filing from the Applicable Time until the later of the Closing
Date and the exercise in full or expiration of the Over-allotment Option specified in Section 1.2 hereof and will furnish the Representative
with copies of the related document(s) a reasonable amount of time prior to such proposed filing, as the case may be, and will not file
or use any such document to which the Representative or counsel for the Underwriters shall reasonably object.
3.2.3.
Exchange Act Registration. Until the later of (i) three (3) years after the date of this Agreement and (ii) the date that all
of the Pre-Funded Warrants have been exercised, the Company shall use its best efforts to maintain the registration of the shares of
Common Stock under the Exchange Act. The Company shall not deregister the shares of Common Stock under the Exchange Act without the prior
written consent of the Representative.
3.2.4.
Free Writing Prospectuses. The Company agrees that, unless it obtains the prior written consent of the Representative, it shall
not make any offer relating to the Public Securities that would constitute an Issuer Free Writing Prospectus or that would otherwise
constitute a “free writing prospectus,” or a portion thereof, required to be filed by the Company with the Commission or
retained by the Company under Rule 433; provided that the Representative shall be deemed to have consented to each Issuer General Use
Free Writing Prospectus hereto and any “road show that is a written communication” within the meaning of Rule 433(d)(8)(i)
that has been reviewed by the Representative. The Company represents that it has treated or agrees that it will treat each such free
writing prospectus consented to, or deemed consented to, by the Underwriters as an “issuer free writing prospectus,” as defined
in Rule 433, and that it has complied and will comply with the applicable requirements of Rule 433 with respect thereto, including timely
filing with the Commission where required, legending and record keeping. If at any time following issuance of an Issuer Free Writing
Prospectus there occurred or occurs an event or development as a result of which such Issuer Free Writing Prospectus conflicted or would
conflict with the information contained in the Registration Statement or included or would include an untrue statement of a material
fact or omitted or would omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances
existing at that subsequent time, not misleading, the Company will promptly notify the Underwriters and will promptly amend or supplement,
at its own expense, such Issuer Free Writing Prospectus to eliminate or correct such conflict, untrue statement or omission.
3.2.5.
Testing-the-Waters Communications. If at any time following the distribution of any Written Testing-the-Waters Communication there
occurred or occurs an event or development as a result of which such Written Testing-the-Waters Communication included or would include
an untrue statement of a material fact or omitted or would omit to state a material fact necessary in order to make the statements therein,
in the light of the circumstances existing at that subsequent time, not misleading, the Company shall promptly notify the Representative
and shall promptly amend or supplement, at its own expense, such Written Testing-the-Waters Communication to eliminate or correct such
untrue statement or omission.
3.3
Delivery to the Underwriters of Registration Statements. The Company has delivered or made available or shall deliver or make
available to the Representative and counsel for the Representative, without charge, signed copies of the Registration Statement as originally
filed and each amendment thereto (including exhibits filed therewith or incorporated by reference therein and documents incorporated
or deemed incorporated by reference therein) and signed copies of all consents and certificates of experts, and will also deliver to
the Underwriters, without charge, a conformed copy of the Registration Statement as originally filed and each amendment thereto (without
exhibits) for each of the Underwriters. The copies of the Registration Statement and each amendment thereto furnished to the Underwriters
will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent
permitted by Regulation S-T.
3.4
Delivery to the Underwriters of Prospectuses. The Company has delivered or made available or will deliver or make available to
each Underwriter, without charge, as many copies of each Preliminary Prospectus as such Underwriter reasonably requested, and the Company
hereby consents to the use of such copies for purposes permitted by the Securities Act. The Company will furnish to each Underwriter,
without charge, during the period when a prospectus relating to the Public Securities is (or, but for the exception afforded by Rule
172, would be) required to be delivered under the Securities Act, such number of copies of the Prospectus (as amended or supplemented)
as such Underwriter may reasonably request. The Prospectus and any amendments or supplements thereto furnished to the Underwriters will
be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted
by Regulation S-T.
3.5
Effectiveness and Events Requiring Notice to the Representative. The Company shall use its best efforts to cause the Registration
Statement to remain effective with a current prospectus until the date that all of the Pre-Funded Warrants have been exercised, and shall
notify the Representative immediately and confirm the notice in writing: (i) of the effectiveness of the Registration Statement and any
amendment thereto; (ii) of the issuance by the Commission of any stop order or of the initiation, or the threatening, of any proceeding
for that purpose; (iii) of the issuance by any state securities commission of any proceedings for the suspension of the qualification
of the Public Securities for offering or sale in any jurisdiction or of the initiation, or the threatening, of any proceeding for that
purpose; (iv) of the mailing and delivery to the Commission for filing of any amendment or supplement to the Registration Statement or
Prospectus; (v) of the receipt of any comments or request for any additional information from the Commission; and (vi) of the happening
of any event during the period described in this Section 3.5 that, in the judgment of the Company, makes any statement of a material
fact made in the Registration Statement, the Pricing Disclosure Package or the Prospectus untrue or that requires the making of any changes
in (a) the Registration Statement in order to make the statements therein not misleading, or (b) in the Pricing Disclosure Package or
the Prospectus in order to make the statements therein, in light of the circumstances under which they were made, not misleading. If
the Commission or any state securities commission shall enter a stop order or suspend such qualification at any time, the Company shall
make every reasonable effort to obtain promptly the lifting of such order.
3.6
Review of Financial Statements. For a period of five (5) years after the date of this Agreement, the Company, at its expense,
shall cause its regularly engaged independent registered public accounting firm to review (but not audit) the Company’s financial
statements for each of the three fiscal quarters immediately preceding the announcement of any quarterly financial information.
3.7
Listing. The Company shall use its best efforts to maintain the listing of the shares of Common Stock (including the Public Securities)
on the Exchange until the later of (i) three years from the date of this Agreement and (ii) the date that all Pre-Funded Warrants have
been exercised.
3.8
Financial Public Relations Firm. As of the Effective Date, the Company shall have retained a financial public relations firm reasonably
acceptable to the Representative and the Company, which shall initially be Zimmons International Communications, Inc., which firm shall
be experienced in assisting issuers in initial public offerings of securities and in their relations with their security holders, and
shall retain such firm or another firm reasonably acceptable to the Representative for a period of not less than two (2) years after
the Effective Date.
3.9
Reports to the Representative.
3.9.1.
Periodic Reports, etc. For a period of three (3) years after the date of this Agreement, the Company shall furnish or make available
to the Representative copies of such financial statements and other periodic and special reports as the Company from time to time furnishes
generally to holders of any class of its securities and also promptly furnish to the Representative: (i) a copy of each periodic report
the Company shall be required to file with the Commission under the Exchange Act and the Exchange Act Regulations; (ii) a copy of every
press release and every news item and article with respect to the Company or its affairs which was released by the Company; (iii) a copy
of each Form 8-K prepared and filed by the Company; (iv) five copies of each registration statement filed by the Company under the Securities
Act; and (v) such additional documents and information with respect to the Company and the affairs of any future subsidiaries of the
Company as the Representative may from time to time reasonably request; provided the Representative shall sign, if requested by the Company,
a Regulation FD compliant confidentiality agreement which is reasonably acceptable to the Representative and Representative Counsel in
connection with the Representative’s receipt of such information. Documents filed with the Commission pursuant to its EDGAR system
shall be deemed to have been delivered to the Representative pursuant to this Section 3.9.1.
3.9.2.
Transfer Agent; Transfer Sheets. Until the later of (i) three (3) years after the date of this Agreement and (ii) the date that
all Pre-Funded Warrants have been exercised, the Company shall retain a transfer agent and registrar acceptable to the Representative
(the “Transfer Agent”) and shall furnish to the Representative at the Company’s sole cost and expense such transfer
sheets of the Company’s securities as the Representative may reasonably request, including the daily and monthly consolidated transfer
sheets of the Transfer Agent and DTC. Pacific Stock Transfer, Inc. is acceptable to the Representative to act as Transfer Agent for the
shares of Common Stock.
3.9.3.
Trading Reports. During such time as the Public Securities are listed on the Exchange, the Company shall provide to the Representative,
at the Company’s expense, such reports published by the Exchange relating to price trading of the Public Securities, as the Representative
shall reasonably request.
3.10
Payment of Expenses
3.10.1.
General Expenses Related to the Offering. The Company hereby agrees to pay on each of the Closing Date and the Option Closing
Date, if any, to the extent not paid at the Closing Date, all expenses incident to the performance of the obligations of the Company
under this Agreement, including, but not limited to: (a) all filing fees and communication expenses relating to the registration of the
shares of Common Stock to be sold in the Offering (including the Option Shares) with the Commission; (b) all Public Filing System filing
fees associated with the review of the Offering by FINRA; (c) all fees and expenses relating to the listing of such Public Securities
on the Exchange and such other stock exchanges as the Company and the Representative together determine; (d) all fees, expenses and disbursements
relating to background checks of the Company’s officers and directors in an amount not to exceed $15,000 in the aggregate; (e)
all fees, expenses and disbursements relating to the registration or qualification of the Public Securities under the “blue sky”
securities laws of such states and other jurisdictions as the Representative may reasonably designate (including, without limitation,
all filing and registration fees); (f) all fees, expenses and disbursements relating to the registration, qualification or exemption
of the Public Securities under the securities laws of such foreign jurisdictions as the Representative may reasonably designate; (g)
the costs of all mailing and printing of the underwriting documents (including, without limitation, the Underwriting Agreement, any Blue
Sky Surveys and, if appropriate, any Agreement Among Underwriters, Selected Dealers’ Agreement, Underwriters’ Questionnaire
and Power of Attorney), Registration Statements, Prospectuses and all amendments, supplements and exhibits thereto and as many preliminary
and final Prospectuses as the Representative may reasonably deem necessary; (h) the costs and expenses of a public relations firm; (i)
the costs of preparing, printing and delivering certificates representing the Public Securities; (j) fees and expenses of the transfer
agent for the shares of Common Stock; (k) stock transfer and/or stamp taxes, if any, payable upon the transfer of securities from the
Company to the Underwriters; (l) the costs associated with post-Closing advertising the Offering in the national editions of the Wall
Street Journal and New York Times; (m) the costs associated with bound volumes of the public offering materials as well as commemorative
mementos and lucite tombstones, each of which the Company or its designee shall provide within a reasonable time after the Closing Date
in such quantities as the Representative may reasonably request, in an amount not to exceed $3,000; (n) the fees and expenses of the
Company’s accountants; (o) the fees and expenses of the Company’s legal counsel and other agents and representatives; (p)
fees and expenses of the Representative’s legal counsel not to exceed $100,000; (q) the $29,500 cost associated with the Underwriter’s
use of Ipreo’s book-building, prospectus tracking and compliance software for the Offering; (r) $10,000 for data services and communications
expenses, (S) up to $10,000 of the Underwriters’ actual accountable “road show” expenses; and (t) up to $30,000 of
the Representative’s market making and trading, and clearing firm settlement expenses for the Offering. The Representative may
deduct from the net proceeds of the Offering payable to the Company on the Closing Date, or the Option Closing Date, if any, the expenses
set forth herein to be paid by the Company to the Underwriters, provided, however, that in the event that the Offering is terminated,
the Company agrees to reimburse the Representative pursuant to Section 8.3 hereof.
3.10.2.
Non-accountable Expenses. The Company further agrees that, in addition to the expenses payable pursuant to Section 3.10.1, on
the Closing Date it shall pay to the Representative, by deduction from the net proceeds of the Offering contemplated herein, a non-accountable
expense allowance equal to one percent (1%) of the gross proceeds received by the Company from the sale of the Firm Securities, presuming
exercise of any Pre-Funded Warrants issued (excluding the Option Securities), less the Advance (as such term is defined in Section 8.3
hereof), provided, however, that in the event that the Offering is terminated, the Company agrees to reimburse the Underwriters pursuant
to Section 8.3 hereof.
3.11
Application of Net Proceeds. The Company shall apply the net proceeds from the Offering received by it in a manner consistent
with the application thereof described under the caption “Use of Proceeds” in the Registration Statement, the Pricing Disclosure
Package and the Prospectus.
3.12
Delivery of Earnings Statements to Security Holders. The Company shall make generally available to its security holders as soon
as practicable, but not later than the first day of the fifteenth (15th) full calendar month following the date of this Agreement,
an earnings statement (which need not be certified by an independent registered public accounting firm unless required by the Securities
Act or the Securities Act Regulations, but which shall satisfy the provisions of Rule 158(a) under Section 11(a) of the Securities Act)
covering a period of at least twelve (12) consecutive months beginning after the date of this Agreement.
3.13
Stabilization. Neither the Company nor, to its knowledge, any of its employees, directors or shareholders (without the consent
of the Representative) has taken or shall take, directly or indirectly, any action designed to or that has constituted or that might
reasonably be expected to cause or result in, under Regulation M of 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 Public Securities.
3.14
Internal Controls. The Company shall maintain a system of internal accounting controls sufficient to provide reasonable assurances
that: (i) transactions are executed in accordance with management’s general or specific authorization; (ii) transactions are recorded
as necessary in order to permit preparation of financial statements in accordance with GAAP and to maintain accountability for assets;
(iii) access to assets is permitted only in accordance with management’s general or specific authorization; and (iv) the recorded
accountability for assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any
differences.
3.15
Accountants. As of the date of this Agreement, the Company shall retain an independent registered public accounting firm reasonably
acceptable to the Representative, and the Company shall continue to retain a nationally recognized independent registered public accounting
firm for a period of at least three (3) years after the date of this Agreement. The Representative acknowledges that the Auditor is acceptable
to the Representative.
3.16
FINRA. The Company shall advise the Representative (who shall make an appropriate filing with FINRA) if it is or becomes aware
that (i) any officer or director of the Company, (ii) any beneficial owner of 5% or more of any class of the Company’s securities
or (iii) any beneficial owner of the Company’s unregistered equity securities which were acquired during the one hundred eighty
(180) days immediately preceding the filing of the Registration Statement is or becomes an affiliate or associated person of a FINRA
member participating in the Offering (as determined in accordance with the rules and regulations of FINRA).
3.17
No Fiduciary Duties. The Company acknowledges and agrees that the Underwriters’ responsibility to the Company is solely
contractual in nature and that none of the Underwriters or their affiliates or any selling agent shall be deemed to be acting in a fiduciary
capacity, or otherwise owes any fiduciary duty to the Company or any of its affiliates in connection with the Offering and the other
transactions contemplated by this Agreement.
3.18
Company Lock-Up Agreements.
3.18.1.
Restriction on Sales of Capital Stock. The Company, on behalf of itself and any successor entity, agrees that, without the prior
written consent of the Representative, it will not, for a period of ninety (90) days after the date of this Agreement (the “Lock-Up
Period”), (i) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to
sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any shares of
capital stock of the Company or any securities convertible into or exercisable or exchangeable for shares of capital stock of the Company;
(ii) file or caused to be filed any registration statement with the Commission relating to the offering of any shares of capital stock
of the Company or any securities convertible into or exercisable or exchangeable for shares of capital stock of the Company; (iii) complete
any offering of debt securities of the Company, other than entering into a line of credit with a traditional bank or (iv) enter into
any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of capital
stock of the Company, whether any such transaction described in clause (i), (ii), (iii) or (iv) above is to be settled by delivery of
shares of capital stock of the Company or such other securities, in cash or otherwise.
The
restrictions contained in this Section 3.18.1 shall not apply to (i) the shares of Common Stock to be sold hereunder, (ii) the issuance
by the Company of shares of Common Stock upon the exercise of a stock option or warrant or the conversion of a security outstanding on
the date hereof, which is disclosed in the Registration Statement, Pricing Disclosure Package and Prospectus, provided that such options,
warrants, and securities have not been amended since the date of this Agreement to increase the number of such securities or to decrease
the exercise price, exchange price or conversion price of such securities or to extend the term of such securities, or (iii) the issuance
by the Company of stock options or shares of capital stock of the Company under any equity compensation plan of the Company, provided
that in each of (ii) and (iii) above, the underlying shares shall be restricted from sale during the entire Lock-Up Period.
3.18.2.
Restriction on Continuous Offerings. Notwithstanding the restrictions contained in Section 3.18.1, the Company, on behalf of itself
and any successor entity, agrees that, without the prior written consent of the Representative, it will not, for a period of 12 months
after the date of this Agreement, directly or indirectly in any “at-the-market” or continuous equity transaction, offer to
sell, sell, contract to sell, grant any option to sell or otherwise dispose of shares of capital stock of the Company or any securities
convertible into or exercisable or exchangeable for shares of capital stock of the Company.
3.19
Release of D&O Lock-up Period. If the Representative, in its sole discretion, agrees to release or waive the restrictions
set forth in the Lock-Up Agreements described in Section 2.24 hereof for an officer or director of the Company and provide the Company
with notice of the impending release or waiver at least three (3) Business Days before the effective date of the release or waiver, the
Company agrees to announce the impending release or waiver by a press release substantially in the form of Exhibit D hereto through
a major news service at least two (2) Business Days before the effective date of the release or waiver.
3.20
Blue Sky Qualifications. The Company shall use its best efforts, in cooperation with the Underwriters, if necessary, to qualify
the Public Securities for offering and sale under the applicable securities laws of such states and other jurisdictions (domestic or
foreign) as the Representative may designate and to maintain such qualifications in effect so long as required to complete the distribution
of the Public Securities; provided, however, that the Company shall not be obligated to file any general consent to service of process
or to qualify as a foreign corporation or as a dealer in securities in any jurisdiction in which it is not so qualified or to subject
itself to taxation in respect of doing business in any jurisdiction in which it is not otherwise so subject.
3.21
Reporting Requirements. The Company, during the period when a prospectus relating to the Public Securities is (or, but for the
exception afforded by Rule 172, would be) required to be delivered under the Securities Act, 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 Exchange Act Regulations. Additionally,
the Company shall report the use of proceeds from the issuance of the Public Securities as may be required under Rule 463 under the Securities
Act Regulations.
3.22
Emerging Growth Company Status. The Company shall promptly notify the Representative if the Company ceases to be an Emerging Growth
Company at any time prior to the later of (i) completion of the distribution of the Public Securities within the meaning of the Securities
Act and (ii) fifteen (15) days following the completion of the Lock-Up Period.
3.23
Sarbanes Oxley. The Disclosure Package and Prospectus, the Company shall at all times comply with all applicable provisions of
the Sarbanes Oxley Act in effect from time to time.
4.
Conditions of Underwriters’ Obligations. The obligations of the Underwriters to purchase and pay for the Public Securities,
as provided herein, shall be subject to (i) the continuing accuracy of the representations and warranties of the Company as of the date
hereof and as of each of the Closing Date and the Option Closing Date, if any; (ii) the accuracy of the statements of officers of the
Company made pursuant to the provisions hereof; (iii) the performance by the Company of its obligations hereunder; and (iv) the following
conditions:
4.1
Regulatory Matters.
4.1.1.
Effectiveness of Registration Statement; Rule 430A Information. The Registration Statement has become effective not later than
5:00 p.m., Eastern time, on the date of this Agreement or such later date and time as shall be consented to in writing by you, and, at
each of the Closing Date and any Option Closing Date, no stop order suspending the effectiveness of the Registration Statement or any
post-effective amendment thereto has been issued under the Securities Act, no order preventing or suspending the use of any Preliminary
Prospectus or the Prospectus has been issued and no proceedings for any of those purposes have been instituted or are pending or, to
the Company’s knowledge, contemplated by the Commission. The Company has complied with each request (if any) from the Commission
for additional information. The Prospectus containing the Rule 430A Information shall have been filed with the Commission in the manner
and within the time frame required by Rule 424(b) (without reliance on Rule 424(b)(8)) or a post-effective amendment providing such information
shall have been filed with, and declared effective by, the Commission in accordance with the requirements of Rule 430A.
4.1.2.
FINRA Clearance. On or before the date of this Agreement, the Representative shall have received clearance from FINRA as to the
amount of compensation allowable or payable to the Underwriters as described in the Registration Statement.
4.1.3.
Exchange Stock Market Clearance. On the Closing Date, the Company’s shares of Common Stock, including the Firm Shares, Option
Shares and Underlying Shares, shall have been approved for listing on the Exchange, subject only to official notice of issuance. On the
first Option Closing Date (if any), the Company’s shares of Common Stock, including the Option Shares, shall have been approved
for listing on the Exchange, subject only to official notice of issuance.
4.2
Company Counsel Matters.
4.2.1.
Closing Date Opinion of Counsel. On the Closing Date, the Representative shall have received the favorable opinion, and a written
statement providing certain “10b-5” negative assurances, of Sheppard, Mullin, Richter & Hampton LLP, counsel to the Company,
dated the Closing Date and addressed to the Representative, in form and substance reasonably satisfactory to the Representative.
4.2.2.
Opinion of Special Intellectual Property Counsel for the Company. On the Closing Date, the Representative shall have received
the opinion, and a written statement providing certain “10b-5” negative assurances, of Dechert LLP, special intellectual
property counsel for the Company, dated the Closing Date, addressed to the Representative, in form and substance reasonably satisfactory
to the Representative.
4.2.3.
Option Closing Date Opinions of Counsel. On the Option Closing Date, if any, the Representative shall have received the favorable
opinions of each counsel listed in Sections 4.2.1 and 4.2.2, dated the Option Closing Date, addressed to the Representative and in form
and substance reasonably satisfactory to the Representative, confirming as of the Option Closing Date, the statements made by such counsels
in their respective opinions delivered on the Closing Date.
4.2.4.
Reliance. In rendering such opinions, such counsel may rely: (i) as to matters involving the application of laws other than the
laws of the United States and jurisdictions in which they are admitted, to the extent such counsel deems proper and to the extent specified
in such opinion, if at all, upon an opinion or opinions (in form and substance reasonably satisfactory to the Representative) of other
counsel reasonably acceptable to the Representative, familiar with the applicable laws; and (ii) as to matters of fact, to the extent
they deem proper, on certificates or other written statements of officers of the Company and officers of departments of various jurisdictions
having custody of documents respecting the corporate existence or good standing of the Company, provided that copies of any such statements
or certificates shall be delivered to Representative Counsel if requested. The opinion of Sheppard, Mullin, Richter & Hampton LLP
and of Dechert LLP and any opinion relied upon by Sheppard, Mullin, Richter & Hampton LLP and of Dechert LLP shall include a statement
to the effect that it may be relied upon by Representative Counsel in its opinion delivered to the Underwriters.
4.3
Comfort Letters.
4.3.1.
Cold Comfort Letter. At the time this Agreement is executed you shall have received a cold comfort letter from the Auditor containing
statements and information of the type customarily included in accountants’ comfort letters with respect to the financial statements
and certain financial information contained or incorporated or deemed incorporated by reference in the Registration Statement, the Pricing
Disclosure Package and the Prospectus, addressed to the Representative and in form and substance satisfactory in all respects to you
and to the Auditor, dated as of the date of this Agreement.
4.3.2.
Bring-down Comfort Letter. At each of the Closing Date and the Option Closing Date, if any, the Representative shall have received
from the Auditor a letter, dated as of the Closing Date or the Option Closing Date, as applicable, to the effect that the Auditor reaffirms
the statements made in the letter furnished pursuant to Section 4.3.1, except that the specified date referred to shall be a date not
more than three (3) Business Days prior to the Closing Date or the Option Closing Date, as applicable.
4.4
Officers’ Certificates.
4.4.1.
Officers’ Certificate. The Company shall have furnished to the Representative a certificate, dated the Closing Date and
any Option Closing Date (if such date is other than the Closing Date), of its Chief Executive Officer, its President and its Chief Financial
Officer stating that (i) such officers have carefully examined the Registration Statement, the Pricing Disclosure Package, any Issuer
Free Writing Prospectus and the Prospectus and, in their opinion, the Registration Statement and each amendment thereto, as of the Applicable
Time and as of the Closing Date (or any Option Closing Date if such date is other than the Closing Date) did not include any untrue statement
of a material fact and did not omit to state a material fact required to be stated therein or necessary to make the statements therein
not misleading, and the Pricing Disclosure Package, as of the Applicable Time and as of the Closing Date (or any Option Closing Date
if such date is other than the Closing Date), any Issuer Free Writing Prospectus as of its date and as of the Closing Date (or any Option
Closing Date if such date is other than the Closing Date), the Prospectus and each amendment or supplement thereto, as of the respective
date thereof and as of the Closing Date, did not include any untrue statement of a material fact and did not omit to state a material
fact necessary in order to make the statements therein, in the light of the circumstances in which they were made, not misleading, (ii)
since the effective date of the Registration Statement, no event has occurred which should have been set forth in a supplement or amendment
to the Registration Statement, the Pricing Disclosure Package or the Prospectus, (iii) to the best of their knowledge after reasonable
investigation, as of the Closing Date (or any Option Closing Date if such date is other than the Closing Date), the representations and
warranties of the Company in this Agreement are true and correct and the Company has complied with all agreements and satisfied all conditions
on its part to be performed or satisfied hereunder at or prior to the Closing Date (or any Option Closing Date if such date is other
than the Closing Date), and (iv) there has not been, subsequent to the date of the most recent audited financial statements included
or incorporated by reference in the Pricing Disclosure Package, any material adverse change in the financial position or results of operations
of the Company, or any change or development that, singularly or in the aggregate, would involve a material adverse change or a prospective
material adverse change, in or affecting the condition (financial or otherwise), results of operations, business, assets or prospects
of the Company, except as set forth in the Prospectus.
4.4.2.
Secretary’s Certificate. At each of the Closing Date and the Option Closing Date, if any, the Representative shall have
received a certificate of the Company signed by the Secretary of the Company, dated the Closing Date or the Option Date, as the case
may be, respectively, certifying: (i) that each of the Charter and Bylaws is true and complete, has not been modified and is in full
force and effect; (ii) that the resolutions of the Company’s Board of Directors relating to the Offering are in full force and
effect and have not been modified; (iii) as to the accuracy and completeness of all correspondence between the Company or its counsel
and the Commission; and (iv) as to the incumbency of the officers of the Company. The documents referred to in such certificate shall
be attached to such certificate.
4.4.3.
Chief Financial Officer’s Certificate. At each of the Closing Date and the Option Closing Date, if any, the Representative
shall have received a certificate of the Chief Financial Officer of the Company, dated the Closing Date or the Option Date, as the case
may be, respectively, with respect to the accuracy of certain information contained in the Registration Statement, the Pricing Disclosure
Package and the Prospectus, in a form reasonably acceptable to the Representative.
4.5
No Material Changes. Prior to and on each of the Closing Date and each Option Closing Date, if any: (i) there shall have been
no Material Adverse Change or development involving a prospective Material Adverse Change in the condition or prospects or the business
activities, financial or otherwise, of the Company from the latest dates as of which such condition is set forth in the Registration
Statement, the Pricing Disclosure Package and the Prospectus; (ii) no action, suit or proceeding, at law or in equity, shall have been
pending or threatened against the Company or any Insider before or by any court or federal or state commission, board or other administrative
agency wherein an unfavorable decision, ruling or finding may result in a Material Adverse Change, except as set forth in the Registration
Statement, the Pricing Disclosure Package and the Prospectus; (iii) no stop order shall have been issued under the Securities Act and
no proceedings therefor shall have been initiated or threatened by the Commission; and (iv) the Registration Statement, the Pricing Disclosure
Package and the Prospectus and any amendments or supplements thereto shall contain all material statements which are required to be stated
therein in accordance with the Securities Act and the Securities Act Regulations and shall conform in all material respects to the requirements
of the Securities Act and the Securities Act Regulations, and neither the Registration Statement, the Pricing Disclosure Package nor
the Prospectus nor any amendment or supplement thereto shall contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made,
not misleading.
4.6
Corporate Proceedings. All corporate proceedings and other legal matters incident to the authorization, form and validity of each
of this Agreement, the Public Securities, the Registration Statement, the Pricing Disclosure Package and the Prospectus and all other
legal matters relating to this Agreement and the transactions contemplated hereby and thereby shall be reasonably satisfactory in all
material respects to counsel for the Underwriters, and the Company shall have furnished to such counsel all documents and information
that they may reasonably request to enable them to pass upon such matters.
4.7
Delivery of Agreements.
4.7.1.
Lock-Up Agreements. On or before the date of this Agreement, the Company shall have delivered to the Representative executed copies
of the Lock-Up Agreements from each of the persons listed in Schedule 3 hereto.
4.7.2.
Representative’s Warrant Agreement. On the Closing Date, the Company shall have delivered to the Representative executed
copies of the Representative’s Warrant Agreement.
4.7.3.
Pre-Funded Warrant Certificate. On or before each of the Closing Data and any Option Closing Date, the Company shall deliver to
the Representative executed copies of the Pre-Funded Warrant Certificate.
4.8
Additional Documents. At the Closing Date and at each Option Closing Date (if any) Representative Counsel shall have been furnished
with such documents and opinions as they may require for the purpose of enabling Representative Counsel to deliver an opinion to the
Underwriters, or in order to evidence the accuracy of any of the representations or warranties, or the fulfillment of any of the conditions,
herein contained; and all proceedings taken by the Company in connection with the issuance and sale of the Public Securities and the
Representative’s Securities as herein contemplated shall be satisfactory in form and substance to the Representative and Representative
Counsel.
5.
Indemnification.
5.1
Indemnification of the Underwriters.
5.1.1.
General. Subject to the conditions set forth below, the Company agrees to indemnify and hold harmless each Underwriter, its affiliates
and each of its and their respective directors, officers, members, employees, representatives, partners, shareholders, affiliates, counsel,
and agents and each person, if any, who controls any such Underwriter within the meaning of Section 15 of the Securities Act or Section
20 of the Exchange Act (collectively the “Underwriter Indemnified Parties,” and each an “Underwriter Indemnified Party”),
against any and all loss, liability, claim, damage and expense whatsoever (including, but not limited to, any and all legal or other
expenses reasonably incurred in investigating, preparing or defending against any litigation, commenced or threatened, or any claim whatsoever,
whether arising out of any action between any of the Underwriter Indemnified Parties and the Company or between any of the Underwriter
Indemnified Parties and any third party, or otherwise) to which they or any of them may become subject under the Securities Act, the
Exchange Act or any other statute or at common law or otherwise or under the laws of foreign countries (a “Claim”), (i) arising
out of or based upon any untrue statement or alleged untrue statement of a material fact contained in (A) the Registration Statement,
the Pricing Disclosure Package, any Preliminary Prospectus, the Prospectus, or in any Issuer Free Writing Prospectus or in any Written
Testing-the-Waters Communication (as from time to time each may be amended and supplemented); (B) any materials or information provided
to investors by, or with the approval of, the Company in connection with the marketing of the Offering, including any “road show”
or investor presentations made to investors by the Company (whether in person or electronically); or (C) any application or other document
or written communication (in this Section 5, collectively called “application”) executed by the Company or based upon written
information furnished by the Company in any jurisdiction in order to qualify the Public Securities and Representative’s Securities
under the securities laws thereof or filed with the Commission, any state securities commission or agency, the Exchange or any other
national securities exchange; or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary
to make the statements therein, in the light of the circumstances under which they were made, not misleading, unless such statement or
omission was made in reliance upon, and in conformity with, the Underwriters’ Information or (ii) otherwise arising in connection
with or allegedly in connection with the Offering. The Company also agrees that it will reimburse each Underwriter Indemnified Party
for all fees and expenses (including, but not limited to, any and all legal or other expenses reasonably incurred in investigating, preparing
or defending against any litigation, commenced or threatened, or any claim whatsoever, whether arising out of any action between any
of the Underwriter Indemnified Parties and the Company or between any of the Underwriter Indemnified Parties and any third party, or
otherwise) (collectively, the “Expenses”), and further agrees wherever and whenever possible to advance payment of Expenses
as they are incurred by an Underwriter Indemnified Party in investigating, preparing, pursuing or defending any Claim.
5.1.2.
Procedure. If any action is brought against an Underwriter Indemnified Party in respect of which indemnity may be sought against
the Company pursuant to Section 5.1.1, such Underwriter Indemnified Party shall promptly notify the Company in writing of the institution
of such action and the Company shall assume the defense of such action, including the employment and fees of counsel (subject to the
approval of such Underwriter Indemnified Party) and payment of actual expenses if an Underwriter Indemnified Party requests that the
Company do so. Such Underwriter Indemnified Party shall have the right to employ its or their own counsel in any such case, but the fees
and expenses of such counsel shall be at the expense of the Company, and shall be advanced by the Company. The Company shall not be liable
for any settlement of any action effected without its consent (which shall not be unreasonably withheld). In addition, the Company shall
not, without the prior written consent of the Underwriters, settle, compromise or consent to the entry of any judgment in or otherwise
seek to terminate any pending or threatened action in respect of which advancement, reimbursement, indemnification or contribution may
be sought hereunder (whether or not such Underwriter Indemnified Party is a party thereto) unless such settlement, compromise, consent
or termination (i) includes an unconditional release of each Underwriter Indemnified Party, acceptable to such Underwriter Indemnified
Party, from all liabilities, expenses and claims arising out of such action for which indemnification or contribution may be sought 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 Underwriter
Indemnified Party.
5.2
Indemnification of the Company. Each Underwriter, severally and not jointly, agrees to indemnify and hold harmless the Company,
its directors, its officers who signed the Registration Statement and persons who control the Company within the meaning of Section 15
of the Securities Act or Section 20 of the Exchange Act against any and all loss, liability, claim, damage and expense described in the
foregoing indemnity from the Company to the several Underwriters, as incurred, but only with respect to untrue statements or omissions
made in the Registration Statement, any Preliminary Prospectus, the Pricing Disclosure Package or Prospectus or any amendment or supplement
thereto or in any application, in reliance upon, and in strict conformity with, the Underwriters’ Information. In case any action
shall be brought against the Company or any other person so indemnified based on any Preliminary Prospectus, the Registration Statement,
the Pricing Disclosure Package or Prospectus or any amendment or supplement thereto or any application, and in respect of which indemnity
may be sought against any Underwriter, such Underwriter shall have the rights and duties given to the Company, and the Company and each
other person so indemnified shall have the rights and duties given to the several Underwriters by the provisions of Section 5.1.2. The
Company agrees promptly to notify the Representative of the commencement of any litigation or proceedings against the Company or any
of its officers, directors or any person, if any, who controls the Company within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act, in connection with the issuance and sale of the Public Securities or in connection with the Registration
Statement, the Pricing Disclosure Package, the Prospectus, or any Issuer Free Writing Prospectus or any Written Testing-the-Waters Communication.
5.3
Contribution.
5.3.1.
Contribution Rights. If the indemnification provided for in this Section 5 shall for any reason be unavailable to or insufficient
to hold harmless an indemnified party under Section 5.1 or 5.2 in respect of any loss, claim, damage or liability, or any action in respect
thereof, referred to therein, then each indemnifying party shall, in lieu of indemnifying such indemnified party, contribute to the amount
paid or payable by such indemnified party as a result of such loss, claim, damage or liability, or action in respect thereof, (i) in
such proportion as shall be appropriate to reflect the relative benefits received by the Company, on the one hand, and the Underwriters,
on the other, from the Offering of the Public Securities, or (ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also
the relative fault of the Company, on the one hand, and the Underwriters, on the other, with respect to the statements or omissions that
resulted in such loss, claim, damage or liability, or action in respect thereof, as well as any other relevant equitable considerations.
The relative benefits received by the Company, on the one hand, and the Underwriters, on the other, with respect to such Offering shall
be deemed to be in the same proportion as the total net proceeds from the Offering of the Public Securities purchased under this Agreement
(before deducting expenses) received by the Company, as set forth in the table on the cover page of the Prospectus, on the one hand,
and the total underwriting discounts and commissions received by the Underwriters with respect to the shares of the Common Stock purchased
under this Agreement, as set forth in the table on the cover page of the Prospectus, on the other hand. The relative fault shall be determined
by reference to whether the untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material
fact relates to information supplied by the Company or the Underwriters, the intent of the parties and their relative knowledge, access
to information and opportunity to correct or prevent such statement or omission. The Company and the Underwriters agree that it would
not be just and equitable if contributions pursuant to this Section 5.3.1 were to be determined by pro rata allocation (even if the Underwriters
were treated as one entity for such purpose) or by any other method of allocation that does not take into account the equitable considerations
referred to herein. The amount paid or payable by an indemnified party as a result of the loss, claim, damage or liability, or action
in respect thereof, referred to above in this Section 5.3.1 shall be deemed to include, for purposes of this Section 5.3.1, any legal
or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 5.3.1 in no event shall an Underwriter be required to contribute any amount in excess
of the amount by which the total underwriting discounts and commissions received by such Underwriter with respect to the Offering of
the Public Securities exceeds the amount of any damages that such Underwriter has otherwise been required to pay by reason of such untrue
or alleged untrue statement or omission or 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.
5.3.2.
Contribution Procedure. Within fifteen (15) days after receipt by any party to this Agreement (or its representative) of notice
of the commencement of any action, suit or proceeding, such party will, if a claim for contribution in respect thereof is to be made
against another party (“contributing party”), notify the contributing party of the commencement thereof, but the failure
to so notify the contributing party will not relieve it from any liability which it may have to any other party other than for contribution
hereunder. In case any such action, suit or proceeding is brought against any party, and such party notifies a contributing party or
its representative of the commencement thereof within the aforesaid 15 days, the contributing party will be entitled to participate therein
with the notifying party and any other contributing party similarly notified. Any such contributing party shall not be liable to any
party seeking contribution on account of any settlement of any claim, action or proceeding affected by such party seeking contribution
on account of any settlement of any claim, action or proceeding affected by such party seeking contribution without the written consent
of such contributing party. The contribution provisions contained in this Section 5.3.2 are intended to supersede, to the extent permitted
by law, any right to contribution under the Securities Act, the Exchange Act or otherwise available. Each Underwriter’s obligations
to contribute pursuant to this Section 5.3.2 are several and not joint.
6.
Default by an Underwriter.
6.1
Default Not Exceeding 10% of Firm Securities or Option Securities. If any Underwriter or Underwriters shall default in its or
their obligations to purchase the Firm Securities or the Option Securities, if the Over-allotment Option is exercised hereunder, and
if the number of the Firm Securities or Option Securities with respect to which such default relates does not exceed in the aggregate
10% of the number of Firm Securities or Option Securities that all Underwriters have agreed to purchase hereunder, then such Firm Securities
or Option Securities to which the default relates shall be purchased by the non-defaulting Underwriters in proportion to their respective
commitments hereunder.
6.2
Default Exceeding 10% of Firm Securities or Option Securities. In the event that the default addressed in Section 6.1 relates
to more than 10% of the Firm Securities or Option Securities , you may in your discretion arrange for yourself or for another party or
parties to purchase such Firm Securities or Option Securities to which such default relates on the terms contained herein. If, within
one (1) Business Day after such default relating to more than 10% of the Firm Securities or Option Securities, you do not arrange for
the purchase of such Firm Securities or Option Securities, then the Company shall be entitled to a further period of one (1) Business
Day within which to procure another party or parties satisfactory to you to purchase said Firm Securities or Option Securities on such
terms. In the event that neither you nor the Company arrange for the purchase of the Firm Securities or Option Securities to which a
default relates as provided in this Section 6, this Agreement will automatically be terminated by you or the Company without liability
on the part of the Company (except as provided in Sections 3.10 and 5 hereof) or the several Underwriters (except as provided in Section
5 hereof); provided, however, that if such default occurs with respect to the Option Securities, this Agreement will not terminate as
to the Firm Securities; and provided, further, that nothing herein shall relieve a defaulting Underwriter of its liability, if any, to
the other Underwriters and to the Company for damages occasioned by its default hereunder.
6.3
Postponement of Closing Date. In the event that the Firm Securities or Option Securities to which the default relates are to be
purchased by the non-defaulting Underwriters, or are to be purchased by another party or parties as aforesaid, you or the Company shall
have the right to postpone the Closing Date or Option Closing Date for a reasonable period, but not in any event exceeding five (5) Business
Days, in order to effect whatever changes may thereby be made necessary in the Registration Statement, the Pricing Disclosure Package
or the Prospectus or in any other documents and arrangements, and the Company agrees to file promptly any amendment to the Registration
Statement, the Pricing Disclosure Package or the Prospectus that in the opinion Representative’s Counsel may thereby be made necessary.
The term “Underwriter” as used in this Agreement shall include any party substituted under this Section 6 with like effect
as if it had originally been a party to this Agreement with respect to such shares of Common Stock.
7.
Additional Covenants.
7.1
Board Composition and Board Designations. The Company shall ensure that: (i) the qualifications of the persons serving as members
of the Board of Directors and the overall composition of the Board of Directors comply with the Sarbanes-Oxley Act, with the Exchange
Act and with the listing rules of the Exchange or any other national securities exchange, as the case may be, in the event the Company
seeks to have its securities listed on another exchange or quoted on an automated quotation system, and (ii) if applicable, at least
one member of the Audit Committee of the Board of Directors qualifies as an “audit committee financial expert,” as such term
is defined under Regulation S-K and the listing rules of the Exchange.
7.2
Prohibition on Press Releases and Public Announcements. The Company shall not issue press releases or engage in any other publicity,
without the Representative’s prior written consent, for a period ending at 5:00 p.m., Eastern time, on the first (1st)
Business Day following the forty-fifth (45th) day after the Closing Date, other than normal and customary releases issued
in the ordinary course of the Company’s business.
7.3
Right of First Refusal. Provided that the Firm Securities are sold in accordance with the terms of this Agreement, the Representative
shall have an irrevocable right of first refusal (the “Right of First Refusal”), for a period of three (3) months after the
date the Offering is completed, to act as sole and exclusive investment banker, sole book-runner, and/or sole and exclusive placement
agent, at the Representative’s sole and exclusive discretion, for each and every future public and private equity and debt offering,
including all equity linked financings (each, a “Subject Transaction”), during such three (3) month period, of the Company,
or any successor to or subsidiary of the Company, on terms and conditions customary to the Representative for such Subject Transactions.
For the avoidance of any doubt, the Company shall not retain, engage or solicit any additional investment banker, book-runner and/or
placement agent in a Subject Transaction without the express written consent of the Representative.
The
Company shall notify the Representative of its intention to pursue a Subject Transaction, including the material terms thereof, by providing
written notice thereof by registered mail or overnight courier service addressed to the Representative. If the Representative fails to
exercise its Right of First Refusal with respect to any Subject Transaction within ten (10) Business Days after the mailing of such written
notice, then the Representative shall have no further claim or right with respect to the Subject Transaction. The Representative may
elect, in its sole and absolute discretion, not to exercise its Right of First Refusal with respect to any Subject Transaction; provided
that any such election by the Representative shall not adversely affect the Representative’s Right of First Refusal with respect
to any other Subject Transaction during the three (3) month period agreed to above.
8.
Effective Date of this Agreement and Termination Thereof.
8.1
Effective Date. This Agreement shall become effective when both the Company and the Representative have executed the same and
delivered counterparts of such signatures to the other party.
8.2
Termination. The Representative shall have the right to terminate this Agreement at any time prior to any Closing Date, (i) if
any domestic or international event or act or occurrence has materially disrupted, or in your opinion will in the immediate future materially
disrupt, general securities markets in the United States; or (ii) if trading on the New York Stock Exchange or the Nasdaq Stock Market
LLC shall have been suspended or materially limited, or minimum or maximum prices for trading shall have been fixed, or maximum ranges
for prices for securities shall have been required by FINRA or by order of the Commission or any other government authority having jurisdiction;
or (iii) if the United States shall have become involved in a new war or an increase in major hostilities; or (iv) if a banking moratorium
has been declared by a New York State or federal authority; or (v) if a moratorium on foreign exchange trading has been declared which
materially adversely impacts the United States securities markets; or (vi) if the Company shall have sustained a material loss by fire,
flood, accident, hurricane, earthquake, theft, sabotage or other calamity or malicious act which, whether or not such loss shall have
been insured, will, in your opinion, make it inadvisable to proceed with the delivery of the Firm Securities or Option Securities; or
(vii) if the Company is in material breach of any of its representations, warranties or covenants hereunder; or (viii) if the Representative
shall have become aware after the date hereof of such a material adverse change in the conditions or prospects of the Company, or such
adverse material change in general market conditions as in the Representative’s judgment would make it impracticable to proceed
with the offering, sale and/or delivery of the Public Securities or to enforce contracts made by the Underwriters for the sale of the
Public Securities.
8.3
Expenses. Notwithstanding anything to the contrary in this Agreement, except in the case of a default by the Underwriters, pursuant
to Section 6.2 above, in the event that this Agreement shall not be carried out for any reason whatsoever, within the time specified
herein or any extensions thereof pursuant to the terms herein, the Company shall be obligated to pay to the Underwriters their actual
and accountable out-of-pocket expenses related to the transactions contemplated herein then due and payable (including the fees and disbursements
of Representative Counsel) up to $150,000, inclusive of the $25,000 advance for accountable expenses previously paid by the Company to
the Representative (the “Advance”) and upon demand the Company shall pay the full amount thereof to the Representative on
behalf of the Underwriters; provided, however, that such expense cap in no way limits or impairs the indemnification and contribution
provisions of this Agreement. Notwithstanding the foregoing, any advance received by the Representative will be reimbursed to the Company
to the extent not actually incurred in compliance with FINRA Rule 5110(g)(4)(A).
8.4
Indemnification. Notwithstanding any contrary provision contained in this Agreement, any election hereunder or any termination
of this Agreement, and whether or not this Agreement is otherwise carried out, the provisions of Section 5 shall remain in full force
and effect and shall not be in any way affected by, such election or termination or failure to carry out the terms of this Agreement
or any part hereof.
8.5
Representations, Warranties, Agreements to Survive. All representations, warranties and agreements contained in this Agreement
or in certificates of officers of the Company submitted pursuant hereto, shall remain operative and in full force and effect regardless
of (i) any investigation made by or on behalf of any Underwriter or its Affiliates or selling agents, any person controlling any Underwriter,
its officers or directors or any person controlling the Company or (ii) delivery of and payment for the Public Securities.
9.
Miscellaneous.
9.1
Notices. All communications hereunder, except as herein otherwise specifically provided, shall be in writing and shall be mailed
(registered or certified mail, return receipt requested), personally delivered or sent by facsimile transmission and confirmed and shall
be deemed given when so delivered or faxed and confirmed or if mailed, two (2) days after such mailing.
If
to the Representative:
ThinkEquity
LLC
17
State Street, 41st Fl
New
York, NY 10004
Attn: Head of Investment Banking
e-mail:
Notices@think-equity.com
with
a copy (which shall not constitute notice) to:
Dentons US LLP
1221
Avenue of the Americas
New
York, NY 10020
Attn:
Rob Condon, Esq.
Fax:
(212) 768-6800
If
to the Company:
Tharimmune,
Inc.
1200 Route 22 East, Suite 2000
Bridgewater,
NJ 08807
Attention:
Randy Milby, Chief Executive Officer
with
a copy (which shall not constitute notice) to:
Sheppard,
Mullin, Richter & Hampton LLP
30 Rockefeller Plaza
New
York, NY 10112
Attention:
Jeffery J. Fessler, Esq.
Fax:
(917) 438-6133
9.2
Headings. The headings contained herein are for the sole purpose of convenience of reference, and shall not in any way limit or
affect the meaning or interpretation of any of the terms or provisions of this Agreement.
9.3
Amendment. This Agreement may only be amended by a written instrument executed by each of the parties hereto.
9.4
Entire Agreement. This Agreement (together with the other agreements and documents being delivered pursuant to or in connection
with this Agreement) constitutes the entire agreement of the parties hereto with respect to the subject matter hereof and thereof, and
supersedes all prior agreements and understandings of the parties, oral and written, with respect to the subject matter hereof. Notwithstanding
anything to the contrary set forth herein, it is understood and agreed by the parties hereto that all other terms and conditions of that
certain engagement letter between the Company and ThinkEquity LLC dated September 18, 2023, shall remain in full force and effect.
9.5
Binding Effect. This Agreement shall inure solely to the benefit of and shall be binding upon the Representative, the Underwriters,
the Company and the controlling persons, directors and officers referred to in Section 5 hereof, and their respective successors, legal
representatives, heirs and assigns, and no other person shall have or be construed to have any legal or equitable right, remedy or claim
under or in respect of or by virtue of this Agreement or any provisions herein contained. The term “successors and assigns”
shall not include a purchaser, in its capacity as such, of securities from any of the Underwriters.
9.6
Governing Law; Consent to Jurisdiction; Trial by Jury. This Agreement shall be governed by and construed and enforced in accordance
with the laws of the State of New York, without giving effect to conflict of laws principles thereof. The Company hereby agrees that
any action, proceeding or claim against it arising out of, or relating in any way to this Agreement shall be brought and enforced in
the New York Supreme Court, County of New York, or in the United States District Court for the Southern District of New York, and irrevocably
submits to such jurisdiction, which jurisdiction shall be exclusive. The Company hereby waives any objection to such exclusive jurisdiction
and that such courts represent an inconvenient forum. Any such process or summons to be served upon the Company may be served by transmitting
a copy thereof by registered or certified mail, return receipt requested, postage prepaid, addressed to it at the address set forth in
Section 9.1 hereof. Such mailing shall be deemed personal service and shall be legal and binding upon the Company in any action, proceeding
or claim. The Company agrees that the prevailing party(ies) in any such action shall be entitled to recover from the other party(ies)
all of its reasonable attorneys’ fees and expenses relating to such action or proceeding and/or incurred in connection with the
preparation therefor. The Company (on its behalf and, to the extent permitted by applicable law, on behalf of its stockholders and affiliates)
and each of the Underwriters 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 or the transactions contemplated hereby.
9.7
Execution in Counterparts. This Agreement may be executed in one or more counterparts, and by the different parties hereto in
separate counterparts, each of which shall be deemed to be an original, but all of which taken together shall constitute one and the
same agreement, and shall become effective when one or more counterparts has been signed by each of the parties hereto and delivered
to each of the other parties hereto. Delivery of a signed counterpart of this Agreement by facsimile or email/pdf transmission shall
constitute valid and sufficient delivery thereof.
9.8
Waiver, etc. The failure of any of the parties hereto to at any time enforce any of the provisions of this Agreement shall not
be deemed or construed to be a waiver of any such provision, nor to in any way effect the validity of this Agreement or any provision
hereof or the right of any of the parties hereto to thereafter enforce each and every provision of this Agreement. No waiver of any breach,
non-compliance or non-fulfillment of any of the provisions of this Agreement shall be effective unless set forth in a written instrument
executed by the party or parties against whom or which enforcement of such waiver is sought; and no waiver of any such breach, non-compliance
or non-fulfillment shall be construed or deemed to be a waiver of any other or subsequent breach, non-compliance or non-fulfillment.
[Signature
Page Follows]
If
the foregoing correctly sets forth the understanding between the Underwriters and the Company, please so indicate in the space provided
below for that purpose, whereupon this letter shall constitute a binding agreement between us.
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Very truly yours, |
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THARIMMUNE, INC. |
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Confirmed
as of the date first written above mentioned, on behalf of itself and as Representative of the several Underwriters named on Schedule
1 hereto: |
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THINKEQUITY
LLC |
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[Signature
Page]
Tharimmune,
Inc. – Underwriting Agreement
SCHEDULE
1
Underwriter |
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Total
Number of
Firm
Shares to be Purchased |
|
Total
Number of
Pre-Funded
Warrants to be Purchased |
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Number
of Additional Option Shares and/or Option Pre-Funded Warrants to be Purchased if the Over-Allotment Option is Fully Exercised |
ThinkEquity
LLC . |
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TOTAL |
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SCHEDULE
2-A
Pricing
Information
Number
of Firm Shares:
Number
of Firm Pre-Funded Warrants:
Number
of Option Shares:
Number
of Option Pre-Funded Warrants:
Public
Offering Price per Share:
Public
Offering Price per Pre-Funded Warrant:
Underwriting
Discount per Share:
Underwriting
Discount per Pre-Funded Warrant:
Underwriting
Non-accountable expense allowance per Firm Share:
Underwriting
non-accountable expense allowance per Pre-Funded Warrant:
Proceeds
to Company per Firm Share (before expenses and non-accountable expense allowance):
Proceeds
to Company per Pre-Funded Warrant (before expenses and non-accountable expense allowance):
SCHEDULE
2-B
Issuer
General Use Free Writing Prospectuses
[__]
SCHEDULE
2-C
Written
Testing-the-Waters Communications
[__]
SCHEDULE
3
List
of Lock-Up Parties
Randy
Milby
Leonard
Mazur
Sireesh
Appajosyula, PharmD
Lynne
Bui, MD
Thomas
Hess
Kelly
Anderson
Highpoint
Pharmaceuticals LLC
EXHIBIT
A
FORM
OF PRE-FUNDED COMMON STOCK PURCHASE WARRANT
THARIMMUNE,
INC.
Warrant
Shares: _______ |
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Issue
Date: [_], 2023 |
THIS
PRE-FUNDED COMMON STOCK PURCHASE WARRANT (the “Warrant”) certifies that, for value received, _____________ or its
assigns (the “Holder”) is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter
set forth, at any time on or after the Issue Date and until this Warrant is exercised in full (the “Termination Date”)
but not thereafter, to subscribe for and purchase from Tharimmune, Inc. (formerly Hillstream BioPharma, Inc.), a Delaware corporation
(the “Company”), up to ______ shares of Common Stock (as subject to adjustment hereunder, the “Warrant Shares”).
The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price, as defined in Section 2(b).
Section
1. Definitions. In addition to the terms defined elsewhere in this Warrant, the following terms have the meanings indicated
in this Section 1:
“Affiliate”
means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control
with a Person, as such terms are used in and construed under Rule 405 under the Securities Act.
“Commission”
means the United States Securities and Exchange Commission.
“Common
Stock” means the common stock of the Company, par value $0.0001 per share, and any other class of securities into which such
securities may hereafter be reclassified or changed.
“Common
Stock Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to acquire
at any time Common Stock, including, without limitation, any debt, preferred stock, right, option, warrant or other instrument that is
at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Stock.
“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
“Liens”
means a lien, charge pledge, security interest, encumbrance, right of first refusal, preemptive right or other restriction.
“Person”
means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.
“Proceeding”
means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial proceeding,
such as a deposition), whether commenced or threatened.
“Registration
Statement” means the Company’s registration statement on Form S-1 (File No. 333-[__]).
“Rule
144” means Rule 144 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted
from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect
as such Rule.
“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Trading
Day” means a day on which the Common Stock is traded on a Trading Market.
“Trading
Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date
in question: the OTCQB, OTCQX or Pink Open Market operated by OTC Markets Group, the NYSE American, the Nasdaq Capital Market, the Nasdaq
Global Market, the Nasdaq Global Select Market, or the New York Stock Exchange (or any successors to any of the foregoing).
“Transfer
Agent” means Pacific Stock Transfer Company, 6725 Via Austi Parkway, Suite 300, Las Vegas, Nevada 89119, and any successor
transfer agent of the Company.
“Warrants”
means this Warrant and other Pre-Funded Common Stock Purchase Warrants issued by the Company pursuant to the Registration Statement.
Section
2. Exercise.
a)
Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on or after the Issue
Date and on or before the Termination Date by delivery to the Company of a duly executed facsimile copy (or e-mail attachment) of the
Notice of Exercise in the form annexed hereto (the “Notice of Exercise”). Within the earlier of (i) two (2) Trading
Days and (ii) the number of Trading Days comprising the Standard Settlement Period (as defined in Section 2(d)(i) herein) following the
date of exercise as aforesaid, the Holder shall deliver to the Company the aggregate Exercise Price for the Warrant Shares specified
in the applicable Notice of Exercise by wire transfer or cashier’s check drawn on a United States bank unless the cashless exercise
procedure specified in Section 2(c) below is specified in the applicable Notice of Exercise. No ink-original Notice of Exercise shall
be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise form be required.
Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company
until the Holder has purchased all of the Warrant Shares available hereunder and the Warrant has been exercised in full, in which case,
the Holder shall surrender this Warrant to the Company for cancellation within three (3) Trading Days of the date on which the final
Notice of Exercise is delivered to the Company. Partial exercises of this Warrant resulting in purchases of a portion of the total number
of Warrant Shares available hereunder shall have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder
in an amount equal to the applicable number of Warrant Shares purchased in connection with such partial exercise. The Holder and the
Company shall maintain records showing the number of Warrant Shares purchased and the date of such purchases. The Company shall deliver
any objection to any Notice of Exercise within one (1) Trading Day of receipt of such notice. The Holder and any assignee, by acceptance
of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase of a portion of the
Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any given time may be less than the amount
stated on the face hereof.
b)
Exercise Price. The aggregate exercise price of this Warrant, except for a nominal exercise price of $0.001 per Warrant Share,
was pre-funded to the Company on or prior to the Issue Date and, consequently, no additional consideration (other than the nominal exercise
price of $0.001 per Warrant Share) shall be required to be paid by the Holder to any Person to effect any exercise of this Warrant. The
Holder shall not be entitled to the return or refund of all, or any portion, of such pre-paid aggregate exercise price under any circumstance
or for any reason whatsoever, including in the event this Warrant shall not have been exercised prior to the Termination Date. The remaining
unpaid exercise price per share of Common Stock under this Warrant shall be $0.001, subject to adjustment hereunder (the “Exercise
Price”).
c)
Cashless Exercise. This Warrant may also be exercised, in whole or in part, at such time by means of a “cashless exercise”
in which the Holder shall be entitled to receive a number of Warrant Shares for the deemed surrender of the Warrant in whole or in part
equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:
|
(A) |
= |
as
applicable: (i) the Closing Sale Price of the Common Stock on the Trading Day immediately preceding the date of the applicable Notice
of Exercise if such Notice of Exercise is (1) both executed and delivered pursuant to Section 2(a) hereof on a day that is not a
Trading Day or (2) both executed and delivered pursuant to Section 2(a) hereof on a Trading Day prior to the opening of “regular
trading hours” (as defined in Rule 600(b)(68) of Regulation NMS promulgated under the federal securities laws) on such Trading
Day, (ii) at the option of the Holder, either (x) the VWAP on the Trading Day immediately preceding the date of the applicable Notice
of Exercise or (y) the Bid Price of the Common Stock as of the time of the Holder’s execution of the applicable Notice of Exercise
if such Notice of Exercise is executed during “regular trading hours” on a Trading Day and is delivered within two (2)
hours thereafter pursuant to Section 2(a) hereof (including until two (2) hours after the close of “regular trading hours”
on a Trading Day), or (iii) the Closing Sale Price of the Common Stock on the date of the applicable Notice of Exercise if the date
of such Notice of Exercise is a Trading Day and such Notice of Exercise is both executed and delivered pursuant to Section 2(a) hereof
after the close of “regular trading hours” on such Trading Day; |
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(B) |
= |
the
Exercise Price of this Warrant, as adjusted hereunder; and |
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(X) |
= |
the
number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such
exercise were by means of a cash exercise rather than a cashless exercise. |
The
issue price for each such Warrant Share to be issued pursuant to the cashless exercise of a Warrant will be equal to (B), as defined
above, and the total issue price for the aggregate number of Warrant Shares issued pursuant to the cashless exercise of a Warrant will
be deemed paid and satisfied in full by the deemed surrender to the Company of the portion of such Warrant being exercised in accordance
with this Section 1(c). Notwithstanding anything herein to the contrary, the Company shall not be required to make any cash payments
or net cash settlement to the Holder in lieu of delivery of the Warrant Shares. If Warrant Shares are issued in such a cashless exercise,
the parties acknowledge and agree that in accordance with Section 3(a)(9) of the Securities Act, the Warrant Shares shall take on the
registered characteristics of the Warrants being exercised. The Company agrees not to take any position contrary to this Section 2(c).
“Bid
Price” means, for any security as of the particular time of determination, the bid price for such security on the Trading Market
as reported by Bloomberg as of such time of determination, or, if the Trading Market is not the principal securities exchange or trading
market for such security, the bid price of such security on the principal securities exchange or trading market where such security is
listed or traded as reported by Bloomberg as of such time of determination, or if the foregoing does not apply, the bid price of such
security in the over-the-counter market on the electronic bulletin board for such security as reported by Bloomberg as of such time of
determination, or, if no bid price is reported for such security by Bloomberg as of such time of determination, the average of the bid
prices of any market makers for such security as reported on the Pink Open Market as of such time of determination. If the Bid Price
cannot be calculated for a security as of the particular time of determination on any of the foregoing bases, the Bid Price of such security
as of such time of determination shall be the fair market value as mutually determined by the Company and the Holder. If the Company
and the Holder are unable to agree upon the fair market value of such security, then such fair market value shall be determined pursuant
to the provisions set forth in clause (d) of the definition of VWAP. All such determinations to be appropriately adjusted for any stock
dividend, share split, share consolidation, reclassification or other similar transaction during the applicable calculation period.
“Closing
Sale Price” means, for any security as of any date, the last closing trade price for such security on the Trading Market, as
reported by Bloomberg, or, if the Trading Market begins to operate on an extended hours basis and does not designate the closing trade
price, then the last trade price of such security prior to 4:00:00 p.m., New York time, as reported by Bloomberg, or, if the Trading
Market is not the principal securities exchange or trading market for such security, the last trade price of such security on the principal
securities exchange or trading market where such security is listed or traded as reported by Bloomberg, or if the foregoing do not apply,
the last trade price of such security in the over-the-counter market on the electronic bulletin board for such security as reported by
Bloomberg, or, if no last trade price is reported for such security by Bloomberg, the average of the ask prices of any market makers
for such security as reported on the in the OTC Link or on the Pink Open Market. If the Closing Sale Price cannot be calculated for a
security on a particular date on any of the foregoing bases, Closing Sale Price of such security on such date shall be the fair market
value as mutually determined by the Company and the Holder. If the Company and the Holder are unable to agree upon the fair market value
of such security, then such fair market value shall be determined pursuant to the provisions set forth in clause (d) of the definition
of VWAP. All such determinations to be appropriately adjusted for any stock dividend, share split, share consolidation, reclassification
or other similar transaction during the applicable calculation period.
“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed
or quoted for trading on a Trading Market other than the OTCQB, OTCQX or Pink Open Market operated by OTC Markets Group, the daily volume
weighted average price of the Common Stock for such date (or the nearest preceding date) on the Trading Market on which the Common Stock
is then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New
York City time)), (b) if the Common Stock is then quoted for trading on the OTCQB or OTCQX operated by OTC Markets Group, the volume
weighted average price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, or (c) in all
other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good faith by the
holders of a majority in interest of the Warrants then outstanding and reasonably acceptable to the Company, the fees and expenses of
which shall be paid by the Company.
d)
Mechanics of Exercise.
i.
Delivery of Warrant Shares Upon Exercise. The Company shall cause the Warrant Shares purchased hereunder to be transmitted by
the Transfer Agent to the Holder by crediting the account of the Holder’s or its designee’s balance account with The Depository
Trust Company through its Deposit or Withdrawal at Custodian system (the “DWAC”) if the Company is then a participant
in such system and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or resale
of the Warrant Shares by the Holder or (B) this Warrant is being exercised via cashless exercise, and otherwise by physical delivery
of a certificate, registered in the Company’s share register in the name of the Holder or its designee, for the number of Warrant
Shares to which the Holder is entitled pursuant to such exercise to the address specified by the Holder in the Notice of Exercise by
the date that is the earlier of (i) two (2) Trading Days and (ii) the number of Trading Days comprising the Standard Settlement Period
after the delivery to the Company of the Notice of Exercise (such date, the “Warrant Share Delivery Date”). Upon delivery
of the Notice of Exercise, the Holder shall be deemed for all corporate purposes to have become the Holder of record of the Warrant Shares
with respect to which this Warrant has been exercised, irrespective of the date of delivery of the Warrant Shares, provided that payment
of the aggregate Exercise Price (other than in the case of a cashless exercise) is received within the earlier of (i) two (2) Trading
Days after the delivery to the Company of the Notice of Exercise and (ii) the number of Trading Days comprising the Standard Settlement
Period following delivery of the Notice of Exercise. If the Company fails for any reason to deliver to the Holder the Warrant Shares
subject to a Notice of Exercise by the Warrant Share Delivery Date, the Company shall pay to the Holder, in cash, as liquidated damages
and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on the VWAP of the Common Stock on the date of
the applicable Notice of Exercise), $10 per Trading Day (increasing to $20 per Trading Day on the third Trading Day after the Warrant
Share Delivery Date) for each Trading Day after such Warrant Share Delivery Date until such Warrant Shares are delivered to said Holder
or the Holder rescinds such exercise. The Company agrees to maintain a Transfer Agent that is a participant in the Fast Automated Securities
Transfer or FAST program so long as this Warrant remains outstanding and exercisable. As used herein, “Standard Settlement Period”
means the standard settlement period, expressed in a number of Trading Days, on the Company’s primary Trading Market with respect
to the Common Stock as in effect on the date of delivery of the Notice of Exercise. Notwithstanding the foregoing, with respect to any
Notice(s) of Exercise delivered on or prior to 12:00 p.m. (New York City time) on the Issue Date, which may be delivered at any time
after the time of execution of the Underwriting Agreement, dated [__], 2023 between the Company and ThinkEquity LLC, the Company agrees
to deliver the Warrant Shares subject to such notice(s) by 4:00 p.m. (New York City time) on the Issue Date.
ii.
Delivery of New Warrants Upon Exercise. If this Warrant shall have been exercised in part, the Company shall, at the request of
a Holder and upon surrender of this Warrant certificate, at the time of delivery of the Warrant Shares, deliver to the Holder a new Warrant
evidencing the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in
all other respects be identical with this Warrant.
iii.
Rescission Rights. If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to Section
2(d)(i) by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise.
iv.
Compensation for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise. In addition to any other rights available to
the Holder, if the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares in accordance with the provisions
of Section 2(d)(i) above pursuant to an exercise on or before the Warrant Share Delivery Date, and if after such date the Holder is required
by its broker to purchase (in an open market transaction or otherwise) or the Holder’s brokerage firm otherwise purchases, shares
of Common Stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon
such exercise (a “Buy-In”), then the Company shall (A) pay in cash to the Holder the amount, if any, by which (x)
the Holder’s total purchase price (including brokerage commissions, if any) for the shares of Common Stock so purchased exceeds
(y) the amount obtained by multiplying (1) the number of Warrant Shares that the Company was required to deliver to the Holder in connection
with the exercise at issue by (2) the price at which the sell order giving rise to such purchase obligation was executed, and (B) at
the option of the Holder, either reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such exercise
was not honored (in which case such exercise shall be deemed rescinded) or deliver to the Holder the number of shares of Common Stock
that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if the
Holder purchases shares of Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise
of Common Stock with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (A) of the immediately
preceding sentence the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating
the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence of the amount of such loss. 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 shares
of Common Stock upon exercise of the Warrant as required pursuant to the terms hereof.
v.
No Fractional Shares or Scrip. No fractional shares or scrip representing fractional shares shall be issued upon the exercise
of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the Company
shall, at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied
by the Exercise Price or round up to the next whole share.
vi.
Charges, Taxes and Expenses. Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax
or other incidental expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses shall be paid by the Company,
and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; provided,
however, that in the event that Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant when
surrendered for exercise shall be accompanied by the Assignment Form attached hereto duly executed by the Holder and the Company may
require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto. The Company
shall pay all Transfer Agent fees required for same-day processing of any Notice of Exercise and all fees to the Depository Trust Company
(or another established clearing corporation performing similar functions) required for same-day electronic delivery of the Warrant Shares.
vii.
Closing of Books. The Company shall not close its stockholder books or records in any manner which prevents the timely exercise
of this Warrant, pursuant to the terms hereof.
e)
Holder’s Exercise Limitations. The Company shall not effect any exercise of this Warrant, and a Holder shall not have the
right to exercise any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect to such issuance
after exercise as set forth on the applicable Notice of Exercise, the Holder (together with the Holder’s Affiliates, and any other
Persons acting as a group together with the Holder or any of the Holder’s Affiliates (such Persons, “Attribution Parties”)),
would beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence, the
number of shares of Common Stock beneficially owned by the Holder and its Affiliates and Attribution Parties shall include the number
of shares of Common Stock issuable upon exercise of this Warrant with respect to which such determination is being made, but shall exclude
the number of shares of Common Stock which would be issuable upon (i) exercise of the remaining, non-exercised portion of this Warrant
beneficially owned by the Holder or any of its Affiliates or Attribution Parties and (ii) exercise or conversion of the unexercised or
non-converted portion of any other securities of the Company (including, without limitation, any other Common Stock Equivalents) subject
to a limitation on conversion or exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its
Affiliates or Attribution Parties. Except as set forth in the preceding sentence, for purposes of this Section 2(e), beneficial ownership
shall be calculated in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder, it being
acknowledged by the Holder that the Company is not representing to the Holder that such calculation is in compliance with Section 13(d)
of the Exchange Act and the Holder is solely responsible for any schedules required to be filed in accordance therewith. To the extent
that the limitation contained in this Section 2(e) applies, the determination of whether this Warrant is exercisable (in relation to
other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable
shall be in the sole discretion of the Holder, and the submission of a Notice of Exercise shall be deemed to be the Holder’s determination
of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates and Attribution
Parties) and of which portion of this Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Company
shall have no obligation to verify or confirm the accuracy of such determination. In addition, a determination as to any group status
as contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated
thereunder. For purposes of this Section 2(e), in determining the number of outstanding shares of Common Stock, a Holder may rely on
the number of outstanding shares of Common Stock as reflected in (A) the Company’s most recent periodic or annual report filed
with the Commission, as the case may be, (B) a more recent public announcement by the Company or (C) a more recent written notice by
the Company or the Transfer Agent setting forth the number of shares of Common Stock outstanding. Upon the written or oral request of
a Holder, the Company shall within two Trading Days confirm orally and in writing to the Holder the number of shares of Common Stock
then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion
or exercise of securities of the Company, including this Warrant, by the Holder or its Affiliates or Attribution Parties since the date
as of which such number of outstanding shares of Common Stock was reported. The “Beneficial Ownership Limitation”
shall be 4.99% (or, upon election by a Holder prior to the issuance of any Warrants, 9.99%) of the number of shares of Common Stock outstanding
immediately after giving effect to the issuance of Common Stock issuable upon exercise of this Warrant. The Holder, upon notice to the
Company, may increase or decrease the Beneficial Ownership Limitation provisions of this Section 2(e), provided that the Beneficial Ownership
Limitation in no event exceeds 9.99% of the number of shares of Common Stock outstanding immediately after giving effect to the issuance
of Common Stock upon exercise of this Warrant held by the Holder and the provisions of this Section 2(e) shall continue to apply. Any
increase in the Beneficial Ownership Limitation will not be effective until the 61st day after such notice is delivered to
the Company. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with
the terms of this Section 2(e) to correct this paragraph (or any portion hereof) which may be defective or inconsistent with the intended
Beneficial Ownership Limitation herein contained or to make changes or supplements necessary or desirable to properly give effect to
such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Warrant.
Section
3. Certain Adjustments.
a)
Stock Dividends and Splits. If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend or otherwise
makes a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities payable in shares
of Common Stock (which, for avoidance of doubt, shall not include any Common Stock issued by the Company upon exercise of this Warrant),
(ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines (including by way of reverse stock
split or consolidation) outstanding Common Stock into a smaller number of shares, or (iv) issues by reclassification of shares of Common
Stock any shares of the Company, then in each case the Exercise Price shall be multiplied by a fraction of which the numerator shall
be the number of shares of Common Stock (excluding treasury shares, if any) outstanding immediately before such event and of which the
denominator shall be the number of shares of Common Stock outstanding immediately after such event, and the number of shares issuable
upon exercise of this Warrant shall be proportionately adjusted such that the aggregate Exercise Price of this Warrant shall remain unchanged.
Any adjustment made pursuant to this Section 3(a) shall become effective immediately after the record date for the determination of stockholders
entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision,
combination or re-classification.
b)
Subsequent Rights Offerings. In addition to any adjustments pursuant to Section 3(a) above, if at any time the Company grants,
issues or sells any Common Stock Equivalents or rights to purchase stock, warrants, securities or other property pro rata to the record
holders of shares of Common Stock (the “Purchase Rights”), then the Holder will be entitled to acquire, upon the terms
applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had held the number
of shares of Common Stock acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including
without limitation, the Beneficial Ownership Limitation) immediately before the date on which a record is taken for the grant, issuance
or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares of Common Stock are
to be determined for the grant, issue or sale of such Purchase Rights (provided, however, to the extent that the Holder’s right
to participate in any such Purchase Right would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall
not be entitled to participate in such Purchase Right to such extent (or beneficial ownership of such shares of Common Stock as a result
of such Purchase Right to such extent) and such Purchase Right to such extent shall be held in abeyance for the Holder until such time,
if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).
c)
Pro Rata Distributions. During such time as this Warrant is outstanding, if the Company shall declare or make any dividend or
other distribution of its assets (or rights to acquire its assets) to holders of shares of Common Stock, by way of return of capital
or otherwise (including, without limitation, any distribution of cash, stock or other securities, property or options by way of a dividend,
spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a “Distribution”),
at any time after the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution
to the same extent that the Holder would have participated therein if the Holder had held the number of shares of Common Stock acquirable
upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial
Ownership Limitation) immediately before the date of which a record is taken for such Distribution, or, if no such record is taken, the
date as of which the record holders of shares of Common Stock are to be determined for the participation in such Distribution (provided,
however, to the extent that the Holder’s right to participate in any such Distribution would result in the Holder exceeding
the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Distribution to such extent (or in
the beneficial ownership of any shares of Common Stock as a result of such Distribution to such extent) and the portion of such Distribution
shall be held in abeyance for the benefit of the Holder until such time, if ever, as its right thereto would not result in the Holder
exceeding the Beneficial Ownership Limitation).
d)
Fundamental Transaction. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in one or
more related transactions effects any merger or amalgamation or consolidation of the Company with or into another Person, (ii) the Company,
directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially
all of its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange
offer (whether by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell, tender
or exchange their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding
shares of Common Stock or 50% or more of the voting power of the common equity of the Company, (iv) the Company, directly or indirectly,
in one or more related transactions effects any reclassification, reorganization or recapitalization of shares of Common Stock or any
compulsory share exchange pursuant to which shares of Common Stock are effectively converted into or exchanged for other securities,
cash or property, or (v) the Company, directly or indirectly, in one or more related transactions consummates a share purchase agreement
or other business combination (including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement)
with another Person or group of Persons whereby such other Person or group acquires more than 50% of the outstanding shares of Common
Stock or more of the outstanding Common Stock or 50% or more of the voting power of the common equity of the Company (each a “Fundamental
Transaction”), then, upon any subsequent exercise of this Warrant, the Holder shall have the right to receive, for each Warrant
Share that would have been issuable upon such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option
of the Holder (without regard to any limitation in Section 2(e) on the exercise of this Warrant), the number of shares of Common Stock
of the successor or acquiring corporation or of the Company, if it is the surviving corporation or is otherwise the continuing corporation,
and any additional consideration (the “Alternate Consideration”) receivable as a result of such Fundamental Transaction
by a holder of the number of shares of Common Stock for which this Warrant is exercisable immediately prior to such Fundamental Transaction
(without regard to any limitation in Section 2(e) on the exercise of this Warrant). For purposes of any such exercise, the determination
of the Exercise Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration
issuable in respect of shares of Common Stock in such Fundamental Transaction, and the Company shall apportion the Exercise Price among
the Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration.
If holders of Common Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then
the Holder shall be given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following such
Fundamental Transaction. The Company shall cause any successor entity in a Fundamental Transaction in which the Company is not the survivor
(the “Successor Entity”) to assume in writing all of the obligations of the Company under this Warrant in accordance
with the provisions of this Section 3(d) pursuant to written agreements prior to such Fundamental Transaction and shall, at the option
of the Holder, deliver to the Holder in exchange for this Warrant a security of the Successor Entity evidenced by a written instrument
substantially similar in form and substance to this Warrant which is exercisable for a corresponding number of shares or other securities
of such Successor Entity (or its parent entity) equivalent to the shares of Common Stock acquirable and receivable upon exercise of this
Warrant (without regard to any limitations on the exercise of this Warrant) prior to such Fundamental Transaction, and with an exercise
price which applies the exercise price hereunder to such shares of or other securities (but taking into account the relative value of
the shares of Common Stock pursuant to such Fundamental Transaction and the value of such shares or securities, such number of shares
or securities and such exercise price being for the purpose of protecting the economic value of this Warrant immediately prior to the
consummation of such Fundamental Transaction). Upon the occurrence of any such Fundamental Transaction, the Successor Entity shall succeed
to, and be substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this Warrant referring
to the “Company” shall refer instead to the Successor Entity), and may exercise every right and power of the Company and
shall assume all of the obligations of the Company under this Warrant with the same effect as if such Successor Entity had been named
as the Company herein.
e)
Calculations. All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the
case may be. For purposes of this Section 3, the number of shares of Common Stock deemed to be issued and outstanding as of a given date
shall be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.
f)
Notice to Holder.
i.
Adjustment to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company
shall promptly deliver to the Holder by facsimile or email a notice setting forth the Exercise Price after such adjustment and any resulting
adjustment to the number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.
ii.
Notice to Allow Exercise by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on
the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C) the
Company shall authorize the granting to all holders of the shares of Common Stock rights or warrants to subscribe for or purchase any
shares of the Company or of any rights, (D) the approval of any stockholders of the Company shall be required in connection with any
reclassification of the Common Stock, any consolidation or merger, amalgamation or arrangement to which the Company is a party, any sale
or transfer of all or substantially all of the assets of the Company, or any compulsory share exchange whereby the Common Stock is converted
into other securities, cash or property, or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation or
winding up of the affairs of the Company, then, in each case, the Company shall cause to be delivered by facsimile or email to the Holder
at its last facsimile number or email address as it shall appear upon the Warrant Register of the Company, at least 20 calendar days
prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date on which a record is to be taken
for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which
the holders of the Common Stock of record to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined
or (y) the date on which such reclassification, consolidation, merger, amalgamation, arrangement, sale, transfer or share exchange is
expected to become effective or close, and the date as of which it is expected that holders of the Common Stock of record shall be entitled
to exchange their shares of Common Stock for securities, cash or other property deliverable upon such reclassification, consolidation,
merger, amalgamation, arrangement sale, transfer or share exchange; provided that the failure to deliver such notice or any defect therein
or in the delivery thereof shall not affect the validity of the corporate action required to be specified in such notice. To the extent
that any notice provided in this Warrant constitutes, or contains, material, non-public information regarding the Company or any of its
subsidiaries (the “Subsidiaries”), the Company shall simultaneously file such notice with the Commission pursuant
to a Current Report on Form 8-K. The Holder shall remain entitled to exercise this Warrant during the period commencing on the date of
such notice to the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.
Section
4. Transfer of Warrant.
a)
Transferability. This Warrant and all rights hereunder are transferable, in whole or in part, upon surrender of this Warrant at
the principal office of the Company or its designated agent, together with a written assignment of this Warrant substantially in the
form attached hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon
the making of such transfer. Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant
or Warrants in the name of the assignee or assignees, as applicable, and in the denomination or denominations specified in such instrument
of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant
shall promptly be cancelled. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender
this Warrant to the Company unless the Holder has assigned this Warrant in full, in which case, the Holder shall surrender this Warrant
to the Company within three (3) Trading Days of the date on which the Holder delivers an assignment form to the Company assigning this
Warrant in full. This Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for the purchase of Warrant
Shares without having a new Warrant issued.
b)
New Warrants. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of
the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by
the Holder or its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved in such division
or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided
or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the original Issue Date of this
Warrant and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto.
c)
Warrant Register. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the
“Warrant Register”), in the name of the record Holder hereof from time to time. The Company may deem and treat the
registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder,
and for all other purposes, absent actual notice to the contrary.
Section
5. Miscellaneous.
a)
No Rights as Stockholder Until Exercise. This Warrant does not entitle the Holder to any voting rights, dividends or other rights
as a stockholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i), except as expressly set forth in Section
3. Without limiting any rights of a Holder to receive Warrant Shares on a “cashless exercise” pursuant to Section 2(c) or
to receive cash payments pursuant to Section 2(d)(i) and Section 2(d)(iv) herein, in no event, including if the Company is for any reason
unable to issue and deliver Warrant Shares upon exercise of this Warrant as required pursuant to the terms thereof, shall the Company
be required to net cash settle an exercise of this Warrant.
b)
Loss, Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant Shares,
and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which shall in no event include the
posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate, if mutilated, the Company shall make
and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or stock certificate.
c)
Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required
or granted herein shall not be a Trading Day, then, such action may be taken or such right may be exercised on the next succeeding Trading
Day.
d)
Authorized Shares.
The
Company covenants that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued shares of Common
Stock a sufficient number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under
this Warrant. The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are
charged with the duty of issuing the necessary Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company
shall take all such reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided herein without
violation of any applicable law or regulation, or of any requirements of the Trading Market upon which the Common Stock may be listed
or quoted for trading. The Company covenants that all Warrant Shares which may be issued upon the exercise of the purchase rights represented
by this Warrant will, upon exercise of the purchase rights represented by this Warrant and payment for such Warrant Shares in accordance
herewith, be duly authorized, validly issued, fully paid and non-assessable and free from all taxes, liens and charges created by the
Company in respect of the issue thereof (other than taxes in respect of any transfer occurring contemporaneously with such issue).
Except
and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending
its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, amalgamation, arrangement
dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of
the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all
such actions as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without
limiting the generality of the foregoing, the Company shall (i) not increase the par value of any Warrant Shares above the amount payable
therefor upon such exercise immediately prior to such increase in par value, (ii) take all such action as may be necessary or appropriate
in order that the Company may validly and legally issue fully paid and non-assessable Warrant Shares upon the exercise of this Warrant
and (iii) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory body
having jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under this Warrant.
Before
taking any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the
Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from
any public regulatory body or bodies having jurisdiction thereof.
e)
Governing Law. All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be governed
by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflict
of laws thereof. Each party agrees that all legal Proceedings concerning the interpretation, enforcement and defense of this Warrant
shall be commenced in the state and federal courts sitting in the City of New York, Borough of Manhattan (the “New York Courts”).
Each party hereto hereby irrevocably submits to the exclusive jurisdiction of the New York Courts for the adjudication of any dispute
hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein (including with respect to the enforcement
of any provision hereunder), and hereby irrevocably waives, and agrees not to assert in any suit, action or Proceeding, any claim that
it is not personally subject to the jurisdiction of such New York Courts, or such New York Courts are improper or inconvenient venue
for such Proceeding. If any party shall commence an action or Proceeding to enforce any provisions of this Warrant, then the prevailing
party in such action or Proceeding shall be reimbursed by the other party for its attorneys’ fees and other costs and expenses
incurred in the investigation, preparation and prosecution of such action or Proceeding.
f)
Restrictions. The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, and
the Holder does not utilize cashless exercise, will have restrictions upon resale imposed by state and federal securities laws.
g)
Nonwaiver and Expenses. No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall
operate as a waiver of such right or otherwise prejudice the Holder’s rights, powers or remedies. Without limiting any other provision
of this Warrant, if the Company willfully and knowingly fails to comply with any provision of this Warrant, which results in any material
damages to the Holder, the Company shall pay to the Holder such amounts as shall be sufficient to cover any costs and expenses including,
but not limited to, reasonable attorneys’ fees, including those of appellate Proceedings, incurred by the Holder in collecting
any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.
h)
Notices. Any and all notices or other communications or deliveries to be provided by the Holders hereunder including, without
limitation, any Notice of Exercise, shall be in writing and delivered personally, by facsimile or by e-mail, or sent by a nationally
recognized overnight courier service, addressed to the Company, at [ADDRESS], Attention: [NAME], email address: [●] or such other
email address or address as the Company may specify for such purposes by notice to the Holders. Any and all notices or other communications
or deliveries to be provided by the Company hereunder shall be in writing and delivered personally, by facsimile, email or sent by a
nationally recognized overnight courier service addressed to each Holder at the facsimile number, email address or address of such Holder
appearing on the books of the Company. Any notice or other communication or deliveries hereunder shall be deemed given and effective
on the earliest of (i) the time of transmission, if such notice or communication is delivered via facsimile at the facsimile number or
e-mail at the e-mail address set forth in this Section prior to 5:30 p.m. (New York City time) on any date, (ii) the next Trading Day
after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number or e-mail at the e-mail
address set forth in this Section on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day,
(iii) the second Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service, or (iv)
upon actual receipt by the party to whom such notice is required to be given.
i)
Limitation of Liability. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant
to purchase Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of
the Holder for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability is asserted by the Company
or by creditors of the Company.
j)
Remedies. The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will
be entitled to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate
compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to
assert the defense in any action for specific performance that a remedy at law would be adequate.
k)
Successors and Assigns. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall
inure to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns
of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and shall
be enforceable by the Holder or holder of Warrant Shares.
l)
Amendment. This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company, on
the one hand, and the Holder on the other hand.
m)
Severability. Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall
be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining
provisions of this Warrant.
n)
No Expense Reimbursement. The Holder shall in no way be required the pay, or to reimburse the Company for, any fees or expenses
of the Company’s transfer agent in connection with the issuance or holding or sale of the Common Stock, Warrant and/or Warrant
Shares. The Company shall solely be responsible for any and all such fees and expenses.
o)
Headings. The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed
a part of this Warrant.
********************
(Signature
Page Follows)
IN
WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above
indicated.
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THARIMMUNE,
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NOTICE
OF EXERCISE
(1)
The undersigned hereby elects to purchase ________ Warrant Shares of the Company pursuant to the terms of the attached Warrant (only
if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.
(2)
Payment shall take the form of (check applicable box):
☐
in lawful money of the United States; or
☐
the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection 2(c), to exercise
this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure set forth in
subsection 2(c).
(3)
Please issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:
The
Warrant Shares shall be delivered to the following DWAC Account Number:
[SIGNATURE
OF HOLDER]
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of Investing Entity: |
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of Authorized Signatory of Investing Entity: |
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of Authorized Signatory: |
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ASSIGNMENT
FORM
(To
assign the foregoing Warrant, execute this form and supply required information. Do not use this form to purchase shares.)
FOR
VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby assigned to
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Dated:
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Holder’s
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EXHIBIT
B
FORM
OF REPRESENTATIVE’S WARRANT AGREEMENT
Tharimmune,
Inc.
THE
REGISTERED HOLDER OF THIS PURCHASE WARRANT BY ITS ACCEPTANCE HEREOF, AGREES THAT IT WILL NOT SELL, TRANSFER OR ASSIGN THIS PURCHASE WARRANT
EXCEPT AS HEREIN PROVIDED AND THE REGISTERED HOLDER OF THIS PURCHASE WARRANT AGREES THAT IT WILL NOT SELL, TRANSFER, ASSIGN, PLEDGE OR
HYPOTHECATE THIS PURCHASE WARRANT FOR A PERIOD OF ONE HUNDRED EIGHTY (180) DAYS FOLLOWING THE EFFECTIVE DATE (DEFINED BELOW) TO ANYONE
OTHER THAN (I) THINKEQUITY LLC, OR AN UNDERWRITER OR A SELECTED DEALER IN CONNECTION WITH THE OFFERING, OR (II) A BONA FIDE OFFICER OR
PARTNER OF THINKEQUITY LLC OR OF ANY SUCH UNDERWRITER OR SELECTED DEALER.
THIS
PURCHASE WARRANT IS NOT EXERCISABLE PRIOR TO [__], 2023. VOID AFTER 5:00 P.M., EASTERN TIME, [__], 2028.
WARRANT
TO PURCHASE COMMON STOCK
THARIMMUNE,
INC.
Warrant
Shares: _______
Initial
Exercise Date: [__], 2023
THIS
WARRANT TO PURCHASE COMMON STOCK (the “Warrant”) certifies that, for value received, _____________ or its assigns
(the “Holder”) is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter
set forth, at any time on or after [__], 2023 (the “Initial Exercise Date”) and, in accordance with FINRA Rule 5110(g)(8)(A),
prior to at 5:00 p.m. (New York time) on the date that is five (5) years following the Effective Date (the “Termination Date”)
but not thereafter, to subscribe for and purchase from Tharimmune, Inc. (formerly Hillstream BioPharma, Inc.), a Delaware corporation
(the “Company”), up to ______ shares of common stock, par value $0.0001 per share (the “Common Stock”),
of the Company (the “Warrant Shares”), as subject to adjustment hereunder. The purchase price of one share of Common
Stock under this Warrant shall be equal to the Exercise Price, as defined in Section 2(b).
Section
1. Definitions. In addition to the terms defined elsewhere in this Agreement, the following terms have the meanings indicated
in this Section 1:
“Affiliate”
means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control
with a Person, as such terms are used in and construed under Rule 405 under the Securities Act.
“Business
Day” means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or any day
on which banking institutions in the State of New York are authorized or required by law or other governmental action to close.
“Commission”
means the United States Securities and Exchange Commission.
“Effective
Date” means the effective date of the registration statement on Form S-1 (File No. 333-259821), including any related prospectus
or prospectuses, for the registration of the Company’s Common Stock and the Warrant Shares under the Securities Act, that the Company
has filed with the Commission.
“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
“Person”
means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.
“Rule
144” means Rule 144 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted
from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect
as such Rule.
“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Trading
Day” means a day on which the Trading Market is open for trading.
“Trading
Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date
in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, or the New York
Stock Exchange (or any successors to any of the foregoing).
“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock then listed or
quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding date)
on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30
a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the volume weighted average
price of a share of Common Stock for such date (or the nearest preceding date) on the OTCQB or OTCQX as applicable, (c) if Common Stock
is not then listed or quoted for trading on the OTCQB or OTCQX and if prices for Common Stock are then reported in the “Pink Sheets”
published by OTC Markets Group, Inc. (or a similar organization or agency succeeding to its functions of reporting prices), the most
recent bid price per share of Common Stock so reported, or (d) in all other cases, the fair market value of the Common Stock as determined
by an independent appraiser selected in good faith by the Holder and reasonably acceptable to the Company, the fees and expenses of which
shall be paid by the Company.
Section
2. Exercise.
a)
Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on or after the Initial
Exercise Date and on or before the Termination Date by delivery to the Company (or such other office or agency of the Company as it may
designate by notice in writing to the registered Holder at the address of the Holder appearing on the books of the Company) of a duly
executed facsimile copy (or e-mail attachment) of the Notice of Exercise Form annexed hereto. Within two (2) Trading Days following the
date of exercise as aforesaid, the Holder shall deliver the aggregate Exercise Price for the Warrant Shares specified in the applicable
Notice of Exercise by wire transfer or cashier’s check drawn on a United States bank unless the cashless exercise procedure specified
in Section 2(c) below is specified in the applicable Notice of Exercise. No ink-original Notice of Exercise shall be required, nor shall
any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise form be required. Notwithstanding anything
herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company until the Holder has purchased
all of the Warrant Shares available hereunder and the Warrant has been exercised in full, in which case, the Holder shall surrender this
Warrant to the Company for cancellation within five (5) Trading Days of the date the final Notice of Exercise is delivered to the Company.
Partial exercises of this Warrant resulting in purchases of a portion of the total number of Warrant Shares available hereunder shall
have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder in an amount equal to the applicable number
of Warrant Shares purchased. The Holder and the Company shall maintain records showing the number of Warrant Shares purchased and the
date of such purchases. The Company shall deliver any objection to any Notice of Exercise Form within two (2) Business Days of receipt
of such notice. The Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions
of this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase
hereunder at any given time may be less than the amount stated on the face hereof.
b)
Exercise Price. The exercise price per share of the Common Stock under this Warrant shall be $[__], subject to adjustment hereunder
(the “Exercise Price”).
c)
Cashless Exercise. If there is not an effective registration statement registering the Warrant Shares, then in lieu of exercising
this Warrant by delivering the aggregate Exercise Price by wire transfer or cashier’s check, at the election of the Holder, this
Warrant may also be exercised, in whole or in part, at such time by means of a “cashless exercise” in which the Holder shall
be entitled to receive the number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:
| (A) |
= | as applicable: (i) the VWAP on the Trading Day immediately preceding the date of the
applicable Notice of Exercise if such Notice of Exercise is (1) both executed and delivered
pursuant to Section 2(a) hereof on a day that is not a Trading Day or (2) both executed and
delivered pursuant to Section 2(a) hereof on a Trading Day prior to the opening of “regular
trading hours” (as defined in Rule 600(b)(64) of Regulation NMS promulgated under the
federal securities laws) on such Trading Day, (ii) the VWAP on the Trading Day immediately
preceding the date of the applicable Notice of Exercise if such Notice of Exercise is executed
during “regular trading hours” on a Trading Day and is delivered within two (2)
hours thereafter (including until two (2) hours after the close of “regular trading
hours” on a Trading Day) pursuant to Section 2(a) hereof or (iii) the VWAP on the date
of the applicable Notice of Exercise if the date of such Notice of Exercise is a Trading
Day and such Notice of Exercise is both executed and delivered pursuant to Section 2(a) hereof
after the close of “regular trading hours” on such Trading Day; |
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| (B) |
= | the
Exercise Price of this Warrant, as adjusted hereunder; and |
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| (X) |
= | the
number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such exercise
were by means of a cash exercise rather than a cashless exercise. |
If
Warrant Shares are issued in such a “cashless exercise,” the parties acknowledge and agree that in accordance with Section
3(a)(9) of the Securities Act, the Warrant Shares shall take on the registered characteristics of the Warrants being exercised, and the
holding period of the Warrants being exercised may be tacked on to the holding period of the Warrant Shares. The Company agrees not to
take any position contrary to this Section 2(c).
Notwithstanding
anything herein to the contrary, on the Termination Date, this Warrant shall be automatically exercised via cashless exercise pursuant
to this Section 2(c).
d)
Mechanics of Exercise.
i.
Delivery of Warrant Shares Upon Exercise. The Company shall cause the Warrant Shares purchased hereunder to be transmitted by
its transfer agent to the Holder by crediting the account of the Holder’s or its designee’s balance account with The Depository
Trust Company through its Deposit or Withdrawal at Custodian system (“DWAC”) if the Company is then a participant
in such system and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or resale
of the Warrant Shares by Holder, or (B) the Warrant Shares are eligible for resale by the Holder without volume or manner-of-sale limitations
pursuant to Rule 144 and, in either case, the Warrant Shares have been sold by the Holder prior to the Warrant Share Delivery Date (as
defined below), and otherwise by physical delivery of a certificate, registered in the Company’s share register in the name of
the Holder or its designee, for the number of Warrant Shares to which the Holder is entitled pursuant to such exercise to the address
specified by the Holder in the Notice of Exercise by the date that is two (2) Trading Days after the delivery to the Company of the Notice
of Exercise (such date, the “Warrant Share Delivery Date”). If the Warrant Shares can be delivered via DWAC, the transfer
agent shall have received from the Company, at the expense of the Company, any legal opinions or other documentation required by it to
deliver such Warrant Shares without legend (subject to receipt by the Company of reasonable back up documentation from the Holder, including
with respect to affiliate status) and, if applicable and requested by the Company prior to the Warrant Share Delivery Date, the transfer
agent shall have received from the Holder a confirmation of sale of the Warrant Shares (provided the requirement of the Holder to provide
a confirmation as to the sale of Warrant Shares shall not be applicable to the issuance of unlegended Warrant Shares upon a cashless
exercise of this Warrant if the Warrant Shares are then eligible for resale pursuant to Rule 144(b)(1)). The Warrant Shares shall be
deemed to have been issued, and Holder or any other person so designated to be named therein shall be deemed to have become a holder
of record of such shares for all purposes, as of the date the Warrant has been exercised, with payment to the Company of the Exercise
Price (or by cashless exercise, if permitted) and all taxes required to be paid by the Holder, if any, pursuant to Section 2(d)(vi) prior
to the issuance of such shares, having been paid. If the Company fails for any reason to deliver to the Holder the Warrant Shares subject
to a Notice of Exercise by the second (2nd) Trading Day following the Warrant Share Delivery Date, the Company shall pay to
the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on
the VWAP of the Common Stock on the date of the applicable Notice of Exercise), $10 per Trading Day (increasing to $20 per Trading Day
on the fifth (5th) Trading Day after such liquidated damages begin to accrue) for each Trading Day after the second (2nd)
Trading Day following such Warrant Share Delivery Date until such Warrant Shares are delivered or Holder rescinds such exercise.
ii.
Delivery of New Warrants Upon Exercise. If this Warrant shall have been exercised in part, the Company shall, at the request of
a Holder and upon surrender of this Warrant certificate, at the time of delivery of the Warrant Shares, deliver to the Holder a new Warrant
evidencing the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in
all other respects be identical with this Warrant.
iii.
Rescission Rights. If the Company fails to cause its transfer agent to deliver to the Holder the Warrant Shares pursuant to Section
2(d)(i) by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise; provided, however,
that the Holder shall be required to return any Warrant Shares or Common Stock subject to any such rescinded exercise notice concurrently
with the return to Holder of the aggregate Exercise Price paid to the Company for such Warrant Shares and the restoration of Holder’s
right to acquire such Warrant Shares pursuant to this Warrant (including, issuance of a replacement warrant certificate evidencing such
restored right).
iv.
Compensation for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise. In addition to any other rights available to
the Holder, if the Company fails to cause its transfer agent to transmit to the Holder the Warrant Shares pursuant to an exercise on
or before the Warrant Share Delivery Date, and if after such date the Holder is required by its broker to purchase (in an open market
transaction or otherwise) or the Holder’s brokerage firm otherwise purchases, shares of Common Stock to deliver in satisfaction
of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon such exercise (a “Buy-In”),
then the Company shall (A) pay in cash to the Holder the amount, if any, by which (x) the Holder’s total purchase price (including
brokerage commissions, if any) for the shares of Common Stock so purchased exceeds (y) the amount obtained by multiplying (1) the number
of Warrant Shares that the Company was required to deliver to the Holder in connection with the exercise at issue times (2) the price
at which the sell order giving rise to such purchase obligation was executed, and (B) at the option of the Holder, either reinstate the
portion of the Warrant and equivalent number of Warrant Shares for which such exercise was not honored (in which case such exercise shall
be deemed rescinded) or deliver to the Holder the number of shares of Common Stock that would have been issued had the Company timely
complied with its exercise and delivery obligations hereunder. For example, if the Holder purchases Common Stock having a total purchase
price of $11,000 to cover a Buy-In with respect to an attempted exercise of shares of Common Stock with an aggregate sale price giving
rise to such purchase obligation of $10,000, under clause (A) of the immediately preceding sentence the Company shall be required to
pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of
the Buy-In and, upon request of the Company, evidence of the amount of such loss. 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 shares of Common Stock upon exercise of the Warrant
as required pursuant to the terms hereof.
v.
No Fractional Shares or Scrip. No fractional shares or scrip representing fractional shares shall be issued upon the exercise
of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the Company
shall, at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied
by the Exercise Price or round up to the next whole share.
vi.
Charges, Taxes and Expenses. Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax
or other incidental expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses shall be paid by the Company,
and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; provided,
however, that in the event that Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant when
surrendered for exercise shall be accompanied by the Assignment Form attached hereto duly executed by the Holder and the Company may
require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto. The Company
shall pay all transfer agent fees required for same-day processing of any Notice of Exercise and all fees to the Depository Trust Company
(or another established clearing corporation performing similar functions) required for same-day electronic delivery of the Warrant Shares.
vii.
Closing of Books. The Company will not close its stockholder books or records in any manner which prevents the timely exercise
of this Warrant, pursuant to the terms hereof.
viii.
Signature. This Section 2 and the exercise form attached hereto set forth the totality of the procedures required of the Holder
in order to exercise this Warrant. Without limiting the preceding sentences, no ink-original exercise form shall be required, nor shall
any medallion guarantee (or other type of guarantee or notarization) of any exercise form be required in order to exercise this Warrant.
No additional legal opinion, other information or instructions shall be required of the Holder to exercise this Warrant. The Company
shall honor exercises of this Warrant and shall deliver Warrant Shares underlying this Warrant in accordance with the terms, conditions
and time periods set forth herein.
e)
Holder’s Exercise Limitations. The Company shall not effect any exercise of this Warrant, and a Holder shall not have the
right to exercise any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect to such issuance
after exercise as set forth on the applicable Notice of Exercise, the Holder (together with the Holder’s Affiliates, and any other
Persons acting as a group together with the Holder or any of the Holder’s Affiliates), would beneficially own in excess of the
Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence, the number of shares of Common Stock beneficially
owned by the Holder and its Affiliates shall include the number of shares of Common Stock issuable upon exercise of this Warrant with
respect to which such determination is being made, but shall exclude the number of shares of Common Stock which would be issuable upon
(i) exercise of the remaining, nonexercised portion of this Warrant beneficially owned by the Holder or any of its Affiliates and (ii)
exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including, without limitation,
any other Common Stock equivalents) subject to a limitation on conversion or exercise analogous to the limitation contained herein beneficially
owned by the Holder or any of its Affiliates. Except as set forth in the preceding sentence, for purposes of this Section 2(e), beneficial
ownership shall be calculated in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder,
it being acknowledged by the Holder that the Company is not representing to the Holder that such calculation is in compliance with Section
13(d) of the Exchange Act and the Holder is solely responsible for any schedules required to be filed in accordance therewith. To the
extent that the limitation contained in this Section 2(e) applies, the determination of whether this Warrant is exercisable (in relation
to other securities owned by the Holder together with any Affiliates) and of which portion of this Warrant is exercisable shall be in
the sole discretion of the Holder, and the submission of a Notice of Exercise shall be deemed to be the Holder’s determination
of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates) and of which
portion of this Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Company shall have no obligation
to verify or confirm the accuracy of such determination. In addition, a determination as to any group status as contemplated above shall
be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes
of this Section 2(e), in determining the number of outstanding shares of Common Stock, a Holder may rely on the number of outstanding
shares of Common Stock as reflected in (A) the Company’s most recent periodic or annual report filed with the Commission, as the
case may be, (B) a more recent public announcement by the Company or (C) a more recent written notice by the Company or the Company’s
transfer agent setting forth the number of shares of Common Stock outstanding. Upon the written or oral request of a Holder, the Company
shall within two (2) Trading Days confirm orally and in writing to the Holder the number of shares of Common Stock then outstanding.
In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of
securities of the Company, including this Warrant, by the Holder or its Affiliates since the date as of which such number of outstanding
shares of Common Stock was reported. The “Beneficial Ownership Limitation” shall be 9.99% of the number of shares
of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock issuable upon exercise of this
Warrant. The Holder, upon notice to the Company, may increase or decrease the Beneficial Ownership Limitation provisions of this Section
2(e), provided that the Beneficial Ownership Limitation in no event exceeds 9.99% of the number of shares of the Common Stock outstanding
immediately after giving effect to the issuance of shares of Common Stock upon exercise of this Warrant held by the Holder and the provisions
of this Section 2(e) shall continue to apply. Any increase in the Beneficial Ownership Limitation will not be effective until the 61st
day after such notice is delivered to the Company. The provisions of this paragraph shall be construed and implemented in a manner
otherwise than in strict conformity with the terms of this Section 2(e) to correct this paragraph (or any portion hereof) which may be
defective or inconsistent with the intended Beneficial Ownership Limitation herein contained or to make changes or supplements necessary
or desirable to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder
of this Warrant.
Section
3. Certain Adjustments.
a)
Stock Dividends and Splits. If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend or otherwise
makes a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities payable in shares
of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company upon exercise of this
Warrant), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines (including by way of reverse
stock split) outstanding shares of Common Stock into a smaller number of shares, or (iv) issues by reclassification of shares of the
Common Stock any shares of capital stock of the Company, then in each case the Exercise Price shall be multiplied by a fraction of which
the numerator shall be the number of shares of Common Stock (excluding treasury shares, if any) outstanding immediately before such event
and of which the denominator shall be the number of shares of Common Stock outstanding immediately after such event, and the number of
shares issuable upon exercise of this Warrant shall be proportionately adjusted such that the aggregate Exercise Price of this Warrant
shall remain unchanged. Any adjustment made pursuant to this Section 3(a) shall become effective immediately after the record date for
the determination of stockholders entitled to receive such dividend or distribution and shall become effective immediately after the
effective date in the case of a subdivision, combination or re-classification. For the purposes of clarification, the Exercise Price
of this Warrant will not be adjusted in the event that the Company or any subsidiary thereof, as applicable, sells or grants any option
to purchase, or sell or grant any right to reprice, or otherwise dispose of or issue (or announce any offer, sale, grant or any option
to purchase or other disposition) any Common Stock or Common Stock equivalents, at an effective price per share less than the Exercise
Price then in effect.
b)
[RESERVED]
c)
Subsequent Rights Offerings. In addition to any adjustments pursuant to Section 3(a) above, if at any time the Company grants,
issues or sells any Common Stock equivalents or rights to purchase stock, warrants, securities or other property pro rata to the record
holders of any class of shares of Common Stock (the “Purchase Rights”), then the Holder will be entitled to acquire,
upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had
held the number of shares of Common Stock acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise
hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date on which a record is taken for
the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares
of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights (provided, however, to the extent that the
Holder’s right to participate in any such Purchase Right would result in the Holder exceeding the Beneficial Ownership Limitation,
then the Holder shall not be entitled to participate in such Purchase Right to such extent (or beneficial ownership of such shares of
Common Stock as a result of such Purchase Right to such extent) and such Purchase Right to such extent shall be held in abeyance for
the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).
d)
Pro Rata Distributions. During such time as this Warrant is outstanding, if the Company shall declare or make any dividend (other
than cash dividends) or other distribution of its assets (or rights to acquire its assets) to holders of shares of Common Stock, by way
of return of capital or otherwise (including, without limitation, any distribution of shares or other securities, property or options
by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a “Distribution”),
at any time after the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution
to the same extent that the Holder would have participated therein if the Holder had held the number of shares of Common Stock acquirable
upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial
Ownership Limitation) immediately before the date of which a record is taken for such Distribution, or, if no such record is taken, the
date as of which the record holders of shares of Common Stock are to be determined for the participation in such Distribution (provided,
however, to the extent that the Holder’s right to participate in any such Distribution would result in the Holder exceeding
the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Distribution to such extent (or in
the beneficial ownership of any shares of Common Stock as a result of such Distribution to such extent) and the portion of such Distribution
shall be held in abeyance for the benefit of the Holder until such time, if ever, as its right thereto would not result in the Holder
exceeding the Beneficial Ownership Limitation). To the extent that this Warrant has not been partially or completely exercised at the
time of such Distribution, such portion of the Distribution shall be held in abeyance for the benefit of the Holder until the Holder
has exercised this Warrant.
e)
Fundamental Transaction. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in one or
more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company, directly
or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of
its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer
(whether by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell, tender or exchange
their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding Common Stock,
(iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization or recapitalization
of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted into or exchanged for
other securities, cash or property, or (v) the Company, directly or indirectly, in one or more related transactions consummates a stock
or share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off
or scheme of arrangement) with another Person or group of Persons whereby such other Person or group acquires more than 50% of the outstanding
shares of Common Stock (not including any shares of Common Stock held by the other Person or other Persons making or party to, or associated
or affiliated with the other Persons making or party to, such stock or share purchase agreement or other business combination) (each
a “Fundamental Transaction”), then, upon any subsequent exercise of this Warrant, the Holder shall have the right
to receive, for each Warrant Share that would have been issuable upon such exercise immediately prior to the occurrence of such Fundamental
Transaction, at the option of the Holder (without regard to any limitation in Section 2(e) on the exercise of this Warrant), the number
of shares of Common Stock of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and any additional
consideration (the “Alternate Consideration”) receivable by holders of Common Stock as a result of such Fundamental
Transaction for each share of Common Stock for which this Warrant is exercisable immediately prior to such Fundamental Transaction (without
regard to any limitation in Section 2(e) on the exercise of this Warrant). For purposes of any such exercise, the determination of the
Exercise Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration
issuable in respect of one share of Common Stock in such Fundamental Transaction, and the Company shall apportion the Exercise Price
among the Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration.
If holders of Common Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then
the Holder shall be given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following such
Fundamental Transaction. The Company shall cause any successor entity in a Fundamental Transaction in which the Company is not the survivor
(the “Successor Entity”) to assume in writing all of the obligations of the Company under this Warrant in accordance
with the provisions of this Section 3(e) pursuant to written agreements in form and substance reasonably satisfactory to the Holder and
approved by the Holder (without unreasonable delay) prior to such Fundamental Transaction and shall, at the option of the Holder, deliver
to the Holder in exchange for this Warrant a security of the Successor Entity evidenced by a written instrument substantially similar
in form and substance to this Warrant which is exercisable for a corresponding number of shares of capital stock of such Successor Entity
(or its parent entity) equivalent to the shares of Common Stock acquirable and receivable upon exercise of this Warrant (without regard
to any limitations on the exercise of this Warrant) prior to such Fundamental Transaction, and with an exercise price which applies the
exercise price hereunder to such shares of capital stock (but taking into account the relative value of the shares of Common Stock pursuant
to such Fundamental Transaction and the value of such shares of capital stock, such number of shares of capital stock and such exercise
price being for the purpose of protecting the economic value of this Warrant immediately prior to the consummation of such Fundamental
Transaction), and which is reasonably satisfactory in form and substance to the Holder. Upon the occurrence of any such Fundamental Transaction,
the Successor Entity shall succeed to, and be substituted for (so that from and after the date of such Fundamental Transaction, the provisions
of this Warrant referring to the “Company” shall refer instead to the Successor Entity), and may exercise every right and
power of the Company and shall assume all of the obligations of the Company under this Warrant with the same effect as if such Successor
Entity had been named as the Company herein.
f)
Calculations. All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the
case may be. For purposes of this Section 3, the number of shares of Common Stock deemed to be issued and outstanding as of a given date
shall be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.
g)
Notice to Holder.
i.
Adjustment to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company
shall promptly mail to the Holder a notice setting forth the Exercise Price after such adjustment and any resulting adjustment to the
number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.
ii.
Notice to Allow Exercise by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on
the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C) the
Company shall authorize the granting to all holders of the Common Stock rights or warrants to subscribe for or purchase any shares of
capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall be required in connection with
any reclassification of the Common Stock, any consolidation or merger to which the Company is a party, any sale or transfer of all or
substantially all of the assets of the Company, or any compulsory share exchange whereby the Common Stock is converted into other securities,
cash or property, or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs
of the Company, then, in each case, the Company shall cause to be mailed a notice to the Holder at its last address as it shall appear
upon the Warrant Register of the Company, at least 20 calendar days prior to the applicable record or effective date hereinafter specified,
stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants,
or if a record is not to be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend, distributions,
redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale, transfer
or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the Common Stock
of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable upon such
reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to provide such notice or any defect
therein shall not affect the validity of the corporate action required to be specified in such notice. To the extent that any notice
provided hereunder constitutes, or contains, material, non-public information regarding the Company or any of the subsidiaries, the Company
shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K. The Holder shall remain entitled
to exercise this Warrant during the period commencing on the date of such notice to the effective date of the event triggering such notice
except as may otherwise be expressly set forth herein.
Section
4. Transfer of Warrant.
a)
Transferability. Pursuant to FINRA Rule 5110(e)(1), neither this Warrant nor any Warrant Shares issued upon exercise of this Warrant
shall be sold, transferred, assigned, pledged, or hypothecated, or be the subject of any hedging, short sale, derivative, put, or call
transaction that would result in the effective economic disposition of the securities by any person for a period of 180 days immediately
following the date of effectiveness or commencement of sales of the offering pursuant to which this Warrant is being issued, except the
transfer of any security:
i.
by operation of law or by reason of reorganization of the Company;
ii.
to any FINRA member firm participating in the offering and the officers or partners thereof, if all securities so transferred remain
subject to the lock-up restriction in this Section 4(a) for the remainder of the time period;
iii.
if the aggregate amount of securities of the Company held by the Holder or related person do not exceed 1% of the securities being offered;
iv.
that is beneficially owned on a pro-rata basis by all equity owners of an investment fund, provided that no participating member manages
or otherwise directs investments by the fund, and participating members in the aggregate do not own more than 10% of the equity in the
fund; or
v.
the exercise or conversion of any security, if all securities received remain subject to the lock-up restriction in this Section 4(a)
for the remainder of the time period.
Subject
to the foregoing restriction, any applicable securities laws and the conditions set forth in Section 4(d), this Warrant and all rights
hereunder (including, without limitation, any registration rights) are transferable, in whole or in part, upon surrender of this Warrant
at the principal office of the Company or its designated agent, together with a written assignment of this Warrant substantially in the
form attached hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon
the making of such transfer. Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant
or Warrants in the name of the assignee or assignees, as applicable, and in the denomination or denominations specified in such instrument
of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant
shall promptly be cancelled. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender
this Warrant to the Company unless the Holder has assigned this Warrant in full, in which case, the Holder shall surrender this Warrant
to the Company within three (3) Trading Days of the date the Holder delivers an assignment form to the Company assigning this Warrant
full. The Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for the purchase of Warrant Shares without
having a new Warrant issued.
b)
New Warrants. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of
the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by
the Holder or its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved in such division
or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided
or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the initial issuance date of
this Warrant and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto.
c)
Warrant Register. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the
“Warrant Register”), in the name of the record Holder hereof from time to time. The Company may deem and treat the
registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder,
and for all other purposes, absent actual notice to the contrary.
d)
Representation by the Holder. The Holder, by the acceptance hereof, represents and warrants that it is acquiring this Warrant
and, upon any exercise hereof, will acquire the Warrant Shares issuable upon such exercise, for its own account and not with a view to
or for distributing or reselling such Warrant Shares or any part thereof in violation of the Securities Act or any applicable state securities
law, except pursuant to sales registered or exempted under the Securities Act.
Section
5. Registration Rights.
5.1.
Demand Registration.
5.1.1
Grant of Right. The Company, upon written demand (a “Demand Notice”) of the Holder(s) of at least 51% of the Warrants and/or
the underlying Warrant Shares, agrees to register, on one (1) occasion, all or any portion of the Warrant Shares underlying the Warrants
(collectively, the “Registrable Securities”). On such occasion, the Company will file a registration statement with the Commission
covering the Registrable Securities within sixty (60) days after receipt of a Demand Notice and use its reasonable best efforts to have
the registration statement declared effective promptly thereafter, subject to compliance with review by the Commission; provided, however,
that the Company shall not be required to comply with a Demand Notice if the Company has filed a registration statement with respect
to which the Holder is entitled to piggyback registration rights pursuant to Section 5.2 hereof and either: (i) the Holder has elected
to participate in the offering covered by such registration statement or (ii) if such registration statement relates to an underwritten
primary offering of securities of the Company, until the offering covered by such registration statement has been withdrawn or until
thirty (30) days after such offering is consummated. The demand for registration may be made at any time beginning on the Initial Exercise
Date and expiring on the fifth anniversary of the date of the Underwriting Agreement (as defined below) in accordance with FINRA Rule
5110(g)(8)(C). The Company covenants and agrees to give written notice of its receipt of any Demand Notice by any Holder(s) to all other
registered Holders of the Warrants and/or the Registrable Securities within ten (10) days after the date of the receipt of any such Demand
Notice.
5.1.2
Terms. The Company shall bear all fees and expenses attendant to the registration of the Registrable Securities pursuant to Section 5.1.1,
but the Holders shall pay any and all underwriting commissions and the expenses of any legal counsel selected by the Holders to represent
them in connection with the sale of the Registrable Securities. The Company agrees to use its reasonable best efforts to cause the filing
required herein to become effective promptly and to qualify or register the Registrable Securities in such States as are reasonably requested
by the Holder(s); provided, however, that in no event shall the Company be required to register the Registrable Securities in a State
in which such registration would cause: (i) the Company to be obligated to register or license to do business in such State or submit
to general service of process in such State, or (ii) the principal shareholders of the Company to be obligated to escrow their shares
of capital stock of the Company. The Company shall cause any registration statement filed pursuant to the demand right granted under
Section 5.1.1 to remain effective for a period of at least twelve (12) consecutive months after the date that the Holders of the Registrable
Securities covered by such registration statement are first given the opportunity to sell all of such securities. The Holders shall only
use the prospectuses provided by the Company to sell the Warrant Shares covered by such registration statement, and will immediately
cease to use any prospectus furnished by the Company if the Company advises the Holder that such prospectus may no longer be used due
to a material misstatement or omission. Notwithstanding the provisions of this Section 5.1.2, the Holder shall be entitled to a demand
registration under Section 5.1.1 on only one (1) occasion and such demand registration right shall terminate on the fifth anniversary
of the date of the Underwriting Agreement (as defined below) in accordance with FINRA Rule 5110(g)(8)(C).
5.2
“Piggy-Back” Registration.
5.2.1
Grant of Right. In addition to the demand right of registration described in Section 5.1 hereof, the Holder shall have the right, for
a period of no more than two (2) years from the Initial Exercise Date in accordance with FINRA Rule 5110(g)(8)(D), to include the Registrable
Securities as part of any other registration of securities filed by the Company (other than in connection with a transaction contemplated
by Rule 145(a) promulgated under the Securities Act or pursuant to Form S-8 or Form S-4 or any equivalent form); provided, however, that
if, solely in connection with any primary underwritten public offering for the account of the Company, the managing underwriter(s) thereof
shall, in its reasonable discretion, impose a limitation on the number of Warrant Shares which may be included in the Registration Statement
because, in such underwriter(s)’ judgment, marketing or other factors dictate such limitation is necessary to facilitate public
distribution, then the Company shall be obligated to include in such Registration Statement only such limited portion of the Registrable
Securities with respect to which the Holder requested inclusion hereunder as the underwriter shall reasonably permit. Any exclusion of
Registrable Securities shall be made pro rata among the Holders seeking to include Registrable Securities in proportion to the number
of Registrable Securities sought to be included by such Holders; provided, however, that the Company shall not exclude any Registrable
Securities unless the Company has first excluded all outstanding securities, the holders of which are not entitled to inclusion of such
securities in such Registration Statement or are not entitled to pro rata inclusion with the Registrable Securities.
5.2.2
Terms. The Company shall bear all fees and expenses attendant to registering the Registrable Securities pursuant to Section 5.2.1 hereof,
but the Holders shall pay any and all underwriting commissions and the expenses of any legal counsel selected by the Holders to represent
them in connection with the sale of the Registrable Securities. In the event of such a proposed registration, the Company shall furnish
the then Holders of outstanding Registrable Securities with not less than thirty (30) days written notice prior to the proposed date
of filing of such registration statement. Such notice to the Holders shall continue to be given for each registration statement filed
by the Company during the two (2) year period following the Initial Exercise Date until such time as all of the Registrable Securities
have been sold by the Holder. The holders of the Registrable Securities shall exercise the “piggy-back” rights provided for
herein by giving written notice within ten (10) days of the receipt of the Company’s notice of its intention to file a registration
statement. Except as otherwise provided in this Warrant, there shall be no limit on the number of times the Holder may request registration
under this Section 5.2.1; provided, however, that such registration rights shall terminate on the second (2nd) anniversary
of the Initial Exercise Date.
5.3
General Terms
5.3.1
Indemnification. The Company shall indemnify the Holder(s) of the Registrable Securities to be sold pursuant to any registration statement
hereunder and each person, if any, who controls such Holders within the meaning of Section 15 of the Securities Act or Section 20(a)
of the Exchange Act against all loss, claim, damage, expense or liability (including all reasonable attorneys’ fees and other expenses
reasonably incurred in investigating, preparing or defending against any claim whatsoever) to which any of them may become subject under
the Securities Act, the Exchange Act or otherwise, arising from such registration statement but only to the same extent and with the
same effect as the provisions pursuant to which the Company has agreed to indemnify the Underwriters contained in Section 5.1 of the
Underwriting Agreement, dated [__], 2023, by and between the Company and ThinkEquity LLC as representatives of the underwriters set forth
therein (the “Underwriting Agreement”). The Holder(s) of the Registrable Securities to be sold pursuant to such registration
statement, and their successors and assigns, shall severally, and not jointly, indemnify the Company, against all loss, claim, damage,
expense or liability (including all reasonable attorneys’ fees and other expenses reasonably incurred in investigating, preparing
or defending against any claim whatsoever) to which they may become subject under the Securities Act, the Exchange Act or otherwise,
arising from information furnished by or on behalf of such Holders, or their successors or assigns, in writing, for specific inclusion
in such registration statement to the same extent and with the same effect as the provisions contained in Section 5.2 of the Underwriting
Agreement pursuant to which the Underwriters have agreed to indemnify the Company.
5.3.2
Exercise of Warrants. Nothing contained in this Warrant shall be construed as requiring the Holder(s) to exercise their Warrants prior
to or after the initial filing of any registration statement or the effectiveness thereof.
5.3.3
Documents Delivered to Holders. The Company shall furnish to each Holder participating in any of the foregoing offerings and to each
underwriter of any such offering, if any, a signed counterpart, addressed to such Holder or underwriter, of: (i) an opinion of counsel
to the Company, dated the effective date of such registration statement (and, if such registration includes an underwritten public offering,
an opinion dated the date of the closing under any underwriting agreement related thereto), and (ii) a “cold comfort” letter
dated the effective date of such registration statement (and, if such registration includes an underwritten public offering, a letter
dated the date of the closing under the underwriting agreement) signed by the independent registered public accounting firm which has
issued a report on the Company’s financial statements included in such registration statement, in each case covering substantially
the same matters with respect to such registration statement (and the prospectus included therein) and, in the case of such accountants’
letter, with respect to events subsequent to the date of such financial statements, as are customarily covered in opinions of issuer’s
counsel and in accountants’ letters delivered to underwriters in underwritten public offerings of securities. The Company shall
also deliver promptly to each Holder participating in the offering requesting the correspondence and memoranda described below and to
the managing underwriter, if any, copies of all correspondence between the Commission and the Company, its counsel or auditors and all
memoranda relating to discussions with the Commission or its staff with respect to the registration statement and permit each Holder
and underwriter to do such investigation, upon reasonable advance notice, with respect to information contained in or omitted from the
registration statement as it deems reasonably necessary to comply with applicable securities laws or rules of FINRA. Such investigation
shall include access to books, records and properties and opportunities to discuss the business of the Company with its officers and
independent auditors, all to such reasonable extent and at such reasonable times as any such Holder shall reasonably request.
5.3.4
Underwriting Agreement. The Company shall enter into an underwriting agreement with the managing underwriter(s), if any, selected by
any Holders whose Registrable Securities are being registered pursuant to this Section 5, which managing underwriter shall be reasonably
satisfactory to the Company. Such agreement shall be reasonably satisfactory in form and substance to the Company, each Holder and such
managing underwriters, and shall contain such representations, warranties and covenants by the Company and such other terms as are customarily
contained in agreements of that type used by the managing underwriter. The Holders shall be parties to any underwriting agreement relating
to an underwritten sale of their Registrable Securities and may, at their option, require that any or all the representations, warranties
and covenants of the Company to or for the benefit of such underwriters shall also be made to and for the benefit of such Holders. Such
Holders shall not be required to make any representations or warranties to or agreements with the Company or the underwriters except
as they may relate to such Holders, their Warrant Shares and their intended methods of distribution.
5.3.5
Documents to be Delivered by Holder(s). Each of the Holder(s) participating in any of the foregoing offerings shall furnish to the Company
a completed and executed questionnaire provided by the Company requesting information customarily sought of selling security holders.
5.3.6
Damages. Should the registration or the effectiveness thereof required by Sections 5.1 and 5.2 hereof be delayed by the Company or the
Company otherwise fails to comply with such provisions, the Holder(s) shall, in addition to any other legal or other relief available
to the Holder(s), be entitled to obtain specific performance or other equitable (including injunctive) relief against the threatened
breach of such provisions or the continuation of any such breach, without the necessity of proving actual damages and without the necessity
of posting bond or other security.
Section
6. Miscellaneous.
a)
No Rights as Stockholder Until Exercise. This Warrant does not entitle the Holder to any voting rights, dividends or other rights
as a stockholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i).
b)
Loss, Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any certificate relating to the Warrant Shares, and
in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant, shall
not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate, if mutilated, the Company
will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or
stock certificate.
c)
Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required
or granted herein shall not be a Trading Day, then, such action may be taken or such right may be exercised on the next succeeding Trading
Day.
d)
Authorized Shares.
The
Company covenants that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued Common Stock a
sufficient number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant.
The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are charged with
the duty of issuing the necessary Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company will take all
such reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided herein without violation of any
applicable law or regulation, or of any requirements of the Trading Market upon which the Common Stock may be listed. The Company covenants
that all Warrant Shares which may be issued upon the exercise of the purchase rights represented by this Warrant will, upon exercise
of the purchase rights represented by this Warrant and payment for such Warrant Shares in accordance herewith, be duly authorized, validly
issued, fully paid and nonassessable and free from all taxes, liens and charges created by the Company in respect of the issue thereof
(other than taxes in respect of any transfer occurring contemporaneously with such issue).
Except
and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending
its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale
of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant,
but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary
or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without limiting the generality of the
foregoing, the Company will (i) not increase the par value of any Warrant Shares above the amount payable therefor upon such exercise
immediately prior to such increase in par value, (ii) take all such action as may be necessary or appropriate in order that the Company
may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant and (iii) use commercially
reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof,
as may be, necessary to enable the Company to perform its obligations under this Warrant.
Before
taking any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the
Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from
any public regulatory body or bodies having jurisdiction thereof.
e)
Jurisdiction. All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be determined
in accordance with the provisions of the Underwriting Agreement.
f)
Restrictions. The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, and
the Holder does not utilize cashless exercise, will have restrictions upon resale imposed by state and federal securities laws.
g)
Nonwaiver and Expenses. No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall
operate as a waiver of such right or otherwise prejudice the Holder’s rights, powers or remedies. Without limiting any other provision
of this Warrant or the Underwriting Agreement, if the Company willfully and knowingly fails to comply with any provision of this Warrant,
which results in any material damages to the Holder, the Company shall pay to the Holder such amounts as shall be sufficient to cover
any costs and expenses including, but not limited to, reasonable attorneys’ fees, including those of appellate proceedings, incurred
by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.
h)
Notices. Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company shall
be delivered in accordance with the notice provisions of the Underwriting Agreement.
i)
Limitation of Liability. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant
to purchase Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of
the Holder for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability is asserted by the Company
or by creditors of the Company.
j)
Remedies. The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will
be entitled to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate
compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to
assert the defense in any action for specific performance that a remedy at law would be adequate.
k)
Successors and Assigns. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall
inure to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns
of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and shall
be enforceable by the Holder or holder of Warrant Shares.
l)
Amendment. This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and
the Holder.
m)
Severability. Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall
be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining
provisions of this Warrant.
n)
Headings. The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed
a part of this Warrant.
********************
(Signature
Page Follows)
IN
WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above
indicated.
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NOTICE
OF EXERCISE
_________________________
(1)
The undersigned hereby elects to purchase ________ Warrant Shares of the Company pursuant to the terms of the attached Warrant (only
if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.
(2)
Payment shall take the form of (check applicable box):
[
] in lawful money of the United States; or
[
] if permitted the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection
2(c), to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure
set forth in subsection 2(c).
(3)
Please register and issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:
_______________________________
The
Warrant Shares shall be delivered to the following DWAC Account Number or by physical delivery of a certificate to:
_______________________________
_______________________________
_______________________________
(4)
Accredited Investor. The undersigned is an “accredited investor” as defined in Regulation D promulgated under the
Securities Act of 1933, as amended
[SIGNATURE
OF HOLDER]
Name
of Investing Entity: _______________________________________________________________
Signature
of Authorized Signatory of Investing Entity: _________________________________________
Name
of Authorized Signatory: ___________________________________________________________
Title
of Authorized Signatory: ____________________________________________________________
Date:
________________________________________________________________________________
ASSIGNMENT
FORM
(To
assign the foregoing warrant, execute
this form and supply required information.
Do not use this form to exercise the warrant.)
FOR
VALUE RECEIVED, [____] all of or [_______] shares of the foregoing Warrant and all rights evidenced thereby are hereby assigned to
_______________________________________________
whose address is
_______________________________________________________________.
_______________________________________________________________
Dated:
______________, _______
Holder’s
Signature: _____________________________
Holder’s
Address: _____________________________
_____________________________
NOTE:
The signature to this Assignment Form must correspond with the name as it appears on the face of the Warrant, without alteration or enlargement
or any change whatsoever. Officers of corporations and those acting in a fiduciary or other representative capacity should file proper
evidence of authority to assign the foregoing Warrant.
EXHIBIT
C
Lock-Up
Agreement
[●],
2023
ThinkEquity,
LLC
17
State Street, 41st Floor
New
York, NY 10004
As
Representative of the several Underwriters named on Schedule 1 to the Underwriting Agreement referenced below.
Ladies
and Gentlemen:
The
undersigned understands that ThinkEquity, LLC (the “Representative”), proposes to enter into an Underwriting Agreement
(the “Underwriting Agreement”) with Tharimmune, Inc. (formerly Hillstream BioPharma, Inc.), a corporation organized
under the laws of Delaware (collectively with its subsidiaries and affiliates the “Company”), providing for the public
offering (the “Public Offering”) of common stock, $0.0001 par value per share, of the Company (the “Common
Stock”) and pre-funded warrants to purchase shares of Common Stock.
To
induce the Representative to continue its efforts in connection with the Public Offering, the undersigned hereby agrees that, without
the prior written consent of the Representative, the undersigned will not, during the period commencing on the date hereof and ending
on the date which is 180 days after the date of the Underwriting Agreement relating to the Public Offering (the “Lock-Up Period”),
(1) offer, pledge, sell, contract to sell, grant, lend, or otherwise transfer or dispose of, directly or indirectly, any Common Stock
or any securities convertible into or exercisable or exchangeable for Common Stock, whether now owned or hereafter acquired by the undersigned
or with respect to which the undersigned has or hereafter acquires the power of disposition (collectively, the “Lock-Up Securities”);
(2) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership
of the Lock-Up Securities, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of Lock-Up
Securities, in cash or otherwise; (3) make any demand for or exercise any right with respect to the registration of any Lock-Up Securities;
or (4) publicly disclose the intention to make any offer, sale, pledge or disposition, or to enter into any transaction, swap, hedge
or other arrangement relating to any Lock-Up Securities. Notwithstanding the foregoing, and subject to the conditions below, the undersigned
may transfer Lock-Up Securities without the prior written consent of the Representative in connection with (a) transactions relating
to Lock-Up Securities acquired in open market transactions after the completion of the Public Offering; provided that no filing
under Section 13 or Section 16(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or other
public announcement shall be required or shall be voluntarily made in connection with subsequent sales of Lock-Up Securities acquired
in such open market transactions; (b) transfers of Lock-Up Securities as a bona fide gift, by will or intestacy or to a family
member or trust for the benefit of the undersigned or a family member (for purposes of this lock-up agreement, “family member”
means any relationship by blood, marriage or adoption, not more remote than first cousin); (c) transfers of Lock-Up Securities to a charity
or educational institution; (d) if the undersigned is a corporation, partnership, limited liability company or other business entity,
(i) any transfers of Lock-Up Securities to another corporation, partnership or other business entity that controls, is controlled by
or is under common control with the undersigned or (ii) distributions of Lock-Up Securities to members, partners, stockholders, subsidiaries
or affiliates (as defined in Rule 405 promulgated under the Securities Act of 1933, as amended) of the undersigned; (e) if the undersigned
is a trust, to a trustee or beneficiary of the trust; provided that in the case of any transfer pursuant to the foregoing clauses
(b), (c) (d) or (e), (i) any such transfer shall not involve a disposition for value, (ii) each transferee shall sign and deliver to
the Representative a lock-up agreement substantially in the form of this lock-up agreement and (iii) no filing under Section 13 or Section
16(a) of the Exchange Act or other public announcement shall be required or shall be voluntarily made; (f) the receipt by the undersigned
from the Company of Common Stock upon the vesting of restricted stock awards or stock units or upon the exercise of options to purchase
the Company’s Common Stock issued under an equity incentive plan of the Company or an employment arrangement described in the Pricing
Prospectus (as defined in the Underwriting Agreement) (the “Plan Shares”) or the transfer of Common Stock or any securities
convertible into Common Stock to the Company upon a vesting event of the Company’s securities or upon the exercise of options to
purchase the Company’s securities, in each case on a “cashless” or “net exercise” basis or to cover tax
obligations of the undersigned in connection with such vesting or exercise, but only to the extent such right expires during the Lock-up
Period, provided that no filing under Section 13 or Section 16(a) of the Exchange Act or other public announcement shall be required
or shall be voluntarily made within 180 days after the date of the Underwriting Agreement, and after such 180 days, if the undersigned
is required to file a report under Section 13 or Section 16(a) of the Exchange Act reporting a reduction in beneficial ownership of Common
Stock during the Lock-Up Period, the undersigned shall include a statement in such schedule or report to the effect that the purpose
of such transfer was to cover tax withholding obligations of the undersigned in connection with such vesting or exercise and, provided
further, that the Plan Shares shall be subject to the terms of this lock-up agreement; (g) the transfer of Lock-Up Securities pursuant
to agreements described in the Pricing Prospectus under which the Company has the option to repurchase such securities or a right of
first refusal with respect to the transfer of such securities, provided that if the undersigned is required to file a report under
Section 13 or Section 16(a) of the Exchange Act reporting a reduction in beneficial ownership of Common Stock during the Lock-Up Period,
the undersigned shall include a statement in such schedule or report describing the purpose of the transaction; (h) the establishment
of a trading plan pursuant to Rule 10b5-1 under the Exchange Act for the transfer of Lock-Up Securities, provided that (1) such
plan does not provide for the transfer of Lock-Up Securities during the Lock-Up Period and (2) to the extent a public announcement or
filing under the Exchange Act, if any, is required of or voluntarily made by or on behalf of the undersigned or the Company regarding
the establishment of such plan, such public announcement or filing shall include a statement to the effect that no transfer of Lock-Up
Securities may be made under such plan during the Lock-Up Period; (i) the conversion of the outstanding preferred stock of the Company
into Common Stock, provided that such Common Stock remain subject to the terms of this agreement; (j) the transfer of Lock-Up Securities
that occurs by operation of law, such as pursuant to a qualified domestic order or in connection with a divorce settlement, provided
that the transferee agrees to sign and deliver a lock-up agreement substantially in the form of this lock-up agreement for the balance
of the Lock-Up Period, and provided further, that any filing under Section 13 or Section 16(a) of the Exchange Act that is required
to be made during the Lock-Up Period as a result of such transfer shall include a statement that such transfer has occurred by operation
of law; and (k) the transfer of Lock-Up Securities pursuant to a bona fide third party tender offer, merger, consolidation or other similar
transaction made to all holders of the Common Stock involving a change of control (as defined below) of the Company after the closing
of the Public Offering and approved by the Company’s board of directors; provided that in the event that the tender offer,
merger, consolidation or other such transaction is not completed, the Lock-Up Securities owned by the undersigned shall remain subject
to the restrictions contained in this lock-up agreement. For purposes of clause (k) above, “change of control” shall mean
the consummation of any bona fide third party tender offer, merger, amalgamation, consolidation or other similar transaction the result
of which is that any “person” (as defined in Section 13(d)(3) of the Exchange Act), or group of persons, becomes the beneficial
owner (as defined in Rules 13d-3 and 13d-5 of the Exchange Act) of a majority of total voting power of the voting stock of the Company.
The undersigned also agrees and consents to the entry of stop transfer instructions with the Company’s transfer agent and registrar
against the transfer of the undersigned’s Lock-Up Securities except in compliance with this lock-up agreement.
The
undersigned agrees that, prior to engaging in any transaction or taking any other action that is subject to the terms of this lock-up
agreement during the period from the date hereof to and including the 34th day following the expiration of the Lock-Up Period, the undersigned
will give notice thereof to the Company and will not consummate any such transaction or take any such action unless it has received written
confirmation from the Company that the Lock-Up Period has expired.
If
the undersigned is an officer or director of the Company, (i) the undersigned agrees that the foregoing restrictions shall be equally
applicable to any issuer-directed or “friends and family” Securities that the undersigned may purchase in the Public Offering;
(ii) the Representative agrees that, at least three (3) business days before the effective date of any release or waiver of the foregoing
restrictions in connection with a transfer of Lock-Up Securities, the Representative will notify the Company of the impending release
or waiver; and (iii) the Company has agreed in the Underwriting Agreement to announce the impending release or waiver by press release
through a major news service at least two (2) business days before the effective date of the release or waiver. Any release or waiver
granted by the Representative hereunder to any such officer or director shall only be effective two (2) business days after the publication
date of such press release. The provisions of this paragraph will not apply if (a) the release or waiver is effected solely to permit
a transfer of Lock-Up Securities not for consideration and (b) the transferee has agreed in writing to be bound by the same terms described
in this lock-up agreement to the extent and for the duration that such terms remain in effect at the time of such transfer.
The
undersigned understands that the Company and the Representative are relying upon this lock-up agreement in proceeding toward consummation
of the Public Offering. The undersigned further understands that this lock-up agreement is irrevocable and shall be binding upon the
undersigned’s heirs, legal representatives, successors and assigns.
The
undersigned understands that, if the Underwriting Agreement is not executed by March 16, 2024, or if the Underwriting Agreement (other
than the provisions thereof which survive termination) shall terminate or be terminated prior to payment for and delivery of the Common
Stock to be sold thereunder, then this lock-up agreement shall be void and of no further force or effect.
[SIGNATURE
PAGE FOLLOWS]
Whether
or not the Public Offering actually occurs depends on a number of factors, including market conditions. Any Public Offering will only
be made pursuant to an Underwriting Agreement, the terms of which are subject to negotiation between the Company and the Representative.
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[SIGNATURE
PAGE TO THARIMMUNE, INC. LOCK-UP AGREEMENT]
EXHIBIT
D
Form
of Press Release
THARIMMUNE,
INC.
[Date]
Tharimmune,
Inc. (the “Company”) announced today that ThinkEquity LLC, acting as representative for the underwriters in the Company’s
recent public offering of _______ shares of the Company’s common stock, is [waiving] [releasing] a lock-up restriction with respect
to _________ shares of the Company’s common stock held by [certain officers or directors] [an officer or director] of the Company.
The [waiver] [release] will take effect on _________, 20___, and the shares may be sold on or after such date.
This
press release is not an offer or sale of the securities in the United States or in any other jurisdiction where such offer or sale is
prohibited, and such securities may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act of 1933, as amended.
Exhibit
4.3
FORM
OF REPRESENTATIVE’S WARRANT AGREEMENT
Tharimmune,
Inc.
THE
REGISTERED HOLDER OF THIS PURCHASE WARRANT BY ITS ACCEPTANCE HEREOF, AGREES THAT IT WILL NOT SELL, TRANSFER OR ASSIGN THIS PURCHASE WARRANT
EXCEPT AS HEREIN PROVIDED AND THE REGISTERED HOLDER OF THIS PURCHASE WARRANT AGREES THAT IT WILL NOT SELL, TRANSFER, ASSIGN, PLEDGE OR
HYPOTHECATE THIS PURCHASE WARRANT FOR A PERIOD OF ONE HUNDRED EIGHTY (180) DAYS FOLLOWING THE EFFECTIVE DATE (DEFINED BELOW) TO ANYONE
OTHER THAN (I) THINKEQUITY LLC, OR AN UNDERWRITER OR A SELECTED DEALER IN CONNECTION WITH THE OFFERING, OR (II) A BONA FIDE OFFICER OR
PARTNER OF THINKEQUITY LLC OR OF ANY SUCH UNDERWRITER OR SELECTED DEALER.
THIS
PURCHASE WARRANT IS NOT EXERCISABLE PRIOR TO [__], 2023. VOID AFTER 5:00 P.M., EASTERN TIME, [__], 2028.
WARRANT
TO PURCHASE COMMON STOCK
THARIMMUNE,
INC.
Warrant
Shares: _______
Initial
Exercise Date: [__], 2023
THIS
WARRANT TO PURCHASE COMMON STOCK (the “Warrant”) certifies that, for value received, _____________ or its assigns
(the “Holder”) is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter
set forth, at any time on or after [__], 2023 (the “Initial Exercise Date”) and, in accordance with FINRA Rule 5110(g)(8)(A),
prior to at 5:00 p.m. (New York time) on the date that is five (5) years following the Effective Date (the “Termination Date”)
but not thereafter, to subscribe for and purchase from Tharimmune, Inc. (formerly Hillstream BioPharma, Inc.), a Delaware corporation
(the “Company”), up to ______ shares of common stock, par value $0.0001 per share (the “Common Stock”),
of the Company (the “Warrant Shares”), as subject to adjustment hereunder. The purchase price of one share of Common
Stock under this Warrant shall be equal to the Exercise Price, as defined in Section 2(b).
Section
1. Definitions. In addition to the terms defined elsewhere in this Agreement, the following terms have the meanings indicated
in this Section 1:
“Affiliate”
means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control
with a Person, as such terms are used in and construed under Rule 405 under the Securities Act.
“Business
Day” means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or any day
on which banking institutions in the State of New York are authorized or required by law or other governmental action to close.
“Commission”
means the United States Securities and Exchange Commission.
“Effective
Date” means the effective date of the registration statement on Form S-1 (File No. 333-259821), including any related prospectus
or prospectuses, for the registration of the Company’s Common Stock and the Warrant Shares under the Securities Act, that the Company
has filed with the Commission.
“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
“Person”
means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.
“Rule
144” means Rule 144 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted
from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect
as such Rule.
“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Trading
Day” means a day on which the Trading Market is open for trading.
“Trading
Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date
in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, or the New York
Stock Exchange (or any successors to any of the foregoing).
“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock then listed or
quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding date)
on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30
a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the volume weighted average
price of a share of Common Stock for such date (or the nearest preceding date) on the OTCQB or OTCQX as applicable, (c) if Common Stock
is not then listed or quoted for trading on the OTCQB or OTCQX and if prices for Common Stock are then reported in the “Pink Sheets”
published by OTC Markets Group, Inc. (or a similar organization or agency succeeding to its functions of reporting prices), the most
recent bid price per share of Common Stock so reported, or (d) in all other cases, the fair market value of the Common Stock as determined
by an independent appraiser selected in good faith by the Holder and reasonably acceptable to the Company, the fees and expenses of which
shall be paid by the Company.
Section
2. Exercise.
a)
Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on or after the Initial
Exercise Date and on or before the Termination Date by delivery to the Company (or such other office or agency of the Company as it may
designate by notice in writing to the registered Holder at the address of the Holder appearing on the books of the Company) of a duly
executed facsimile copy (or e-mail attachment) of the Notice of Exercise Form annexed hereto. Within two (2) Trading Days following the
date of exercise as aforesaid, the Holder shall deliver the aggregate Exercise Price for the Warrant Shares specified in the applicable
Notice of Exercise by wire transfer or cashier’s check drawn on a United States bank unless the cashless exercise procedure specified
in Section 2(c) below is specified in the applicable Notice of Exercise. No ink-original Notice of Exercise shall be required, nor shall
any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise form be required. Notwithstanding anything
herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company until the Holder has purchased
all of the Warrant Shares available hereunder and the Warrant has been exercised in full, in which case, the Holder shall surrender this
Warrant to the Company for cancellation within five (5) Trading Days of the date the final Notice of Exercise is delivered to the Company.
Partial exercises of this Warrant resulting in purchases of a portion of the total number of Warrant Shares available hereunder shall
have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder in an amount equal to the applicable number
of Warrant Shares purchased. The Holder and the Company shall maintain records showing the number of Warrant Shares purchased and the
date of such purchases. The Company shall deliver any objection to any Notice of Exercise Form within two (2) Business Days of receipt
of such notice. The Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions
of this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase
hereunder at any given time may be less than the amount stated on the face hereof.
b)
Exercise Price. The exercise price per share of the Common Stock under this Warrant shall be $[__], subject to adjustment hereunder
(the “Exercise Price”).
c)
Cashless Exercise. If there is not an effective registration statement registering the Warrant Shares, then in lieu of exercising
this Warrant by delivering the aggregate Exercise Price by wire transfer or cashier’s check, at the election of the Holder, this
Warrant may also be exercised, in whole or in part, at such time by means of a “cashless exercise” in which the Holder shall
be entitled to receive the number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:
(A)
= as applicable: (i) the VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise if such Notice of
Exercise is (1) both executed and delivered pursuant to Section 2(a) hereof on a day that is not a Trading Day or (2) both executed and
delivered pursuant to Section 2(a) hereof on a Trading Day prior to the opening of “regular trading hours” (as defined in
Rule 600(b)(64) of Regulation NMS promulgated under the federal securities laws) on such Trading Day, (ii) the VWAP on the Trading Day
immediately preceding the date of the applicable Notice of Exercise if such Notice of Exercise is executed during “regular trading
hours” on a Trading Day and is delivered within two (2) hours thereafter (including until two (2) hours after the close of “regular
trading hours” on a Trading Day) pursuant to Section 2(a) hereof or (iii) the VWAP on the date of the applicable Notice of Exercise
if the date of such Notice of Exercise is a Trading Day and such Notice of Exercise is both executed and delivered pursuant to Section
2(a) hereof after the close of “regular trading hours” on such Trading Day;
(B)
= the Exercise Price of this Warrant, as adjusted hereunder; and
(X)
= the number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such
exercise were by means of a cash exercise rather than a cashless exercise.
If
Warrant Shares are issued in such a “cashless exercise,” the parties acknowledge and agree that in accordance with Section
3(a)(9) of the Securities Act, the Warrant Shares shall take on the registered characteristics of the Warrants being exercised, and the
holding period of the Warrants being exercised may be tacked on to the holding period of the Warrant Shares. The Company agrees not to
take any position contrary to this Section 2(c).
Notwithstanding
anything herein to the contrary, on the Termination Date, this Warrant shall be automatically exercised via cashless exercise pursuant
to this Section 2(c).
d)
Mechanics of Exercise.
i.
Delivery of Warrant Shares Upon Exercise. The Company shall cause the Warrant Shares purchased hereunder to be transmitted by
its transfer agent to the Holder by crediting the account of the Holder’s or its designee’s balance account with The Depository
Trust Company through its Deposit or Withdrawal at Custodian system (“DWAC”) if the Company is then a participant
in such system and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or resale
of the Warrant Shares by Holder, or (B) the Warrant Shares are eligible for resale by the Holder without volume or manner-of-sale limitations
pursuant to Rule 144 and, in either case, the Warrant Shares have been sold by the Holder prior to the Warrant Share Delivery Date (as
defined below), and otherwise by physical delivery of a certificate, registered in the Company’s share register in the name of
the Holder or its designee, for the number of Warrant Shares to which the Holder is entitled pursuant to such exercise to the address
specified by the Holder in the Notice of Exercise by the date that is two (2) Trading Days after the delivery to the Company of the Notice
of Exercise (such date, the “Warrant Share Delivery Date”). If the Warrant Shares can be delivered via DWAC, the transfer
agent shall have received from the Company, at the expense of the Company, any legal opinions or other documentation required by it to
deliver such Warrant Shares without legend (subject to receipt by the Company of reasonable back up documentation from the Holder, including
with respect to affiliate status) and, if applicable and requested by the Company prior to the Warrant Share Delivery Date, the transfer
agent shall have received from the Holder a confirmation of sale of the Warrant Shares (provided the requirement of the Holder to provide
a confirmation as to the sale of Warrant Shares shall not be applicable to the issuance of unlegended Warrant Shares upon a cashless
exercise of this Warrant if the Warrant Shares are then eligible for resale pursuant to Rule 144(b)(1)). The Warrant Shares shall be
deemed to have been issued, and Holder or any other person so designated to be named therein shall be deemed to have become a holder
of record of such shares for all purposes, as of the date the Warrant has been exercised, with payment to the Company of the Exercise
Price (or by cashless exercise, if permitted) and all taxes required to be paid by the Holder, if any, pursuant to Section 2(d)(vi) prior
to the issuance of such shares, having been paid. If the Company fails for any reason to deliver to the Holder the Warrant Shares subject
to a Notice of Exercise by the second (2nd) Trading Day following the Warrant Share Delivery Date, the Company shall pay to
the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on
the VWAP of the Common Stock on the date of the applicable Notice of Exercise), $10 per Trading Day (increasing to $20 per Trading Day
on the fifth (5th) Trading Day after such liquidated damages begin to accrue) for each Trading Day after the second (2nd)
Trading Day following such Warrant Share Delivery Date until such Warrant Shares are delivered or Holder rescinds such exercise.
ii.
Delivery of New Warrants Upon Exercise. If this Warrant shall have been exercised in part, the Company shall, at the request of
a Holder and upon surrender of this Warrant certificate, at the time of delivery of the Warrant Shares, deliver to the Holder a new Warrant
evidencing the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in
all other respects be identical with this Warrant.
iii.
Rescission Rights. If the Company fails to cause its transfer agent to deliver to the Holder the Warrant Shares pursuant to Section
2(d)(i) by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise; provided, however,
that the Holder shall be required to return any Warrant Shares or Common Stock subject to any such rescinded exercise notice concurrently
with the return to Holder of the aggregate Exercise Price paid to the Company for such Warrant Shares and the restoration of Holder’s
right to acquire such Warrant Shares pursuant to this Warrant (including, issuance of a replacement warrant certificate evidencing such
restored right).
iv.
Compensation for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise. In addition to any other rights available to
the Holder, if the Company fails to cause its transfer agent to transmit to the Holder the Warrant Shares pursuant to an exercise on
or before the Warrant Share Delivery Date, and if after such date the Holder is required by its broker to purchase (in an open market
transaction or otherwise) or the Holder’s brokerage firm otherwise purchases, shares of Common Stock to deliver in satisfaction
of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon such exercise (a “Buy-In”),
then the Company shall (A) pay in cash to the Holder the amount, if any, by which (x) the Holder’s total purchase price (including
brokerage commissions, if any) for the shares of Common Stock so purchased exceeds (y) the amount obtained by multiplying (1) the number
of Warrant Shares that the Company was required to deliver to the Holder in connection with the exercise at issue times (2) the price
at which the sell order giving rise to such purchase obligation was executed, and (B) at the option of the Holder, either reinstate the
portion of the Warrant and equivalent number of Warrant Shares for which such exercise was not honored (in which case such exercise shall
be deemed rescinded) or deliver to the Holder the number of shares of Common Stock that would have been issued had the Company timely
complied with its exercise and delivery obligations hereunder. For example, if the Holder purchases Common Stock having a total purchase
price of $11,000 to cover a Buy-In with respect to an attempted exercise of shares of Common Stock with an aggregate sale price giving
rise to such purchase obligation of $10,000, under clause (A) of the immediately preceding sentence the Company shall be required to
pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of
the Buy-In and, upon request of the Company, evidence of the amount of such loss. 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 shares of Common Stock upon exercise of the Warrant
as required pursuant to the terms hereof.
v.
No Fractional Shares or Scrip. No fractional shares or scrip representing fractional shares shall be issued upon the exercise
of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the Company
shall, at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied
by the Exercise Price or round up to the next whole share.
vi.
Charges, Taxes and Expenses. Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax
or other incidental expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses shall be paid by the Company,
and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; provided,
however, that in the event that Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant when
surrendered for exercise shall be accompanied by the Assignment Form attached hereto duly executed by the Holder and the Company may
require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto. The Company
shall pay all transfer agent fees required for same-day processing of any Notice of Exercise and all fees to the Depository Trust Company
(or another established clearing corporation performing similar functions) required for same-day electronic delivery of the Warrant Shares.
vii.
Closing of Books. The Company will not close its stockholder books or records in any manner which prevents the timely exercise
of this Warrant, pursuant to the terms hereof.
viii.
Signature. This Section 2 and the exercise form attached hereto set forth the totality of the procedures required of the Holder
in order to exercise this Warrant. Without limiting the preceding sentences, no ink-original exercise form shall be required, nor shall
any medallion guarantee (or other type of guarantee or notarization) of any exercise form be required in order to exercise this Warrant.
No additional legal opinion, other information or instructions shall be required of the Holder to exercise this Warrant. The Company
shall honor exercises of this Warrant and shall deliver Warrant Shares underlying this Warrant in accordance with the terms, conditions
and time periods set forth herein.
e)
Holder’s Exercise Limitations. The Company shall not effect any exercise of this Warrant, and a Holder shall not have the
right to exercise any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect to such issuance
after exercise as set forth on the applicable Notice of Exercise, the Holder (together with the Holder’s Affiliates, and any other
Persons acting as a group together with the Holder or any of the Holder’s Affiliates), would beneficially own in excess of the
Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence, the number of shares of Common Stock beneficially
owned by the Holder and its Affiliates shall include the number of shares of Common Stock issuable upon exercise of this Warrant with
respect to which such determination is being made, but shall exclude the number of shares of Common Stock which would be issuable upon
(i) exercise of the remaining, nonexercised portion of this Warrant beneficially owned by the Holder or any of its Affiliates and (ii)
exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including, without limitation,
any other Common Stock equivalents) subject to a limitation on conversion or exercise analogous to the limitation contained herein beneficially
owned by the Holder or any of its Affiliates. Except as set forth in the preceding sentence, for purposes of this Section 2(e), beneficial
ownership shall be calculated in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder,
it being acknowledged by the Holder that the Company is not representing to the Holder that such calculation is in compliance with Section
13(d) of the Exchange Act and the Holder is solely responsible for any schedules required to be filed in accordance therewith. To the
extent that the limitation contained in this Section 2(e) applies, the determination of whether this Warrant is exercisable (in relation
to other securities owned by the Holder together with any Affiliates) and of which portion of this Warrant is exercisable shall be in
the sole discretion of the Holder, and the submission of a Notice of Exercise shall be deemed to be the Holder’s determination
of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates) and of which
portion of this Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Company shall have no obligation
to verify or confirm the accuracy of such determination. In addition, a determination as to any group status as contemplated above shall
be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes
of this Section 2(e), in determining the number of outstanding shares of Common Stock, a Holder may rely on the number of outstanding
shares of Common Stock as reflected in (A) the Company’s most recent periodic or annual report filed with the Commission, as the
case may be, (B) a more recent public announcement by the Company or (C) a more recent written notice by the Company or the Company’s
transfer agent setting forth the number of shares of Common Stock outstanding. Upon the written or oral request of a Holder, the Company
shall within two (2) Trading Days confirm orally and in writing to the Holder the number of shares of Common Stock then outstanding.
In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of
securities of the Company, including this Warrant, by the Holder or its Affiliates since the date as of which such number of outstanding
shares of Common Stock was reported. The “Beneficial Ownership Limitation” shall be 9.99% of the number of shares
of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock issuable upon exercise of this
Warrant. The Holder, upon notice to the Company, may increase or decrease the Beneficial Ownership Limitation provisions of this Section
2(e), provided that the Beneficial Ownership Limitation in no event exceeds 9.99% of the number of shares of the Common Stock outstanding
immediately after giving effect to the issuance of shares of Common Stock upon exercise of this Warrant held by the Holder and the provisions
of this Section 2(e) shall continue to apply. Any increase in the Beneficial Ownership Limitation will not be effective until the 61st
day after such notice is delivered to the Company. The provisions of this paragraph shall be construed and implemented in a manner
otherwise than in strict conformity with the terms of this Section 2(e) to correct this paragraph (or any portion hereof) which may be
defective or inconsistent with the intended Beneficial Ownership Limitation herein contained or to make changes or supplements necessary
or desirable to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder
of this Warrant.
Section
3. Certain Adjustments.
a)
Stock Dividends and Splits. If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend or otherwise
makes a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities payable in shares
of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company upon exercise of this
Warrant), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines (including by way of reverse
stock split) outstanding shares of Common Stock into a smaller number of shares, or (iv) issues by reclassification of shares of the
Common Stock any shares of capital stock of the Company, then in each case the Exercise Price shall be multiplied by a fraction of which
the numerator shall be the number of shares of Common Stock (excluding treasury shares, if any) outstanding immediately before such event
and of which the denominator shall be the number of shares of Common Stock outstanding immediately after such event, and the number of
shares issuable upon exercise of this Warrant shall be proportionately adjusted such that the aggregate Exercise Price of this Warrant
shall remain unchanged. Any adjustment made pursuant to this Section 3(a) shall become effective immediately after the record date for
the determination of stockholders entitled to receive such dividend or distribution and shall become effective immediately after the
effective date in the case of a subdivision, combination or re-classification. For the purposes of clarification, the Exercise Price
of this Warrant will not be adjusted in the event that the Company or any subsidiary thereof, as applicable, sells or grants any option
to purchase, or sell or grant any right to reprice, or otherwise dispose of or issue (or announce any offer, sale, grant or any option
to purchase or other disposition) any Common Stock or Common Stock equivalents, at an effective price per share less than the Exercise
Price then in effect.
b)
[RESERVED]
c)
Subsequent Rights Offerings. In addition to any adjustments pursuant to Section 3(a) above, if at any time the Company grants,
issues or sells any Common Stock equivalents or rights to purchase stock, warrants, securities or other property pro rata to the record
holders of any class of shares of Common Stock (the “Purchase Rights”), then the Holder will be entitled to acquire,
upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had
held the number of shares of Common Stock acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise
hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date on which a record is taken for
the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares
of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights (provided, however, to the extent that the
Holder’s right to participate in any such Purchase Right would result in the Holder exceeding the Beneficial Ownership Limitation,
then the Holder shall not be entitled to participate in such Purchase Right to such extent (or beneficial ownership of such shares of
Common Stock as a result of such Purchase Right to such extent) and such Purchase Right to such extent shall be held in abeyance for
the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).
d)
Pro Rata Distributions. During such time as this Warrant is outstanding, if the Company shall declare or make any dividend (other
than cash dividends) or other distribution of its assets (or rights to acquire its assets) to holders of shares of Common Stock, by way
of return of capital or otherwise (including, without limitation, any distribution of shares or other securities, property or options
by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a “Distribution”),
at any time after the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution
to the same extent that the Holder would have participated therein if the Holder had held the number of shares of Common Stock acquirable
upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial
Ownership Limitation) immediately before the date of which a record is taken for such Distribution, or, if no such record is taken, the
date as of which the record holders of shares of Common Stock are to be determined for the participation in such Distribution (provided,
however, to the extent that the Holder’s right to participate in any such Distribution would result in the Holder exceeding
the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Distribution to such extent (or in
the beneficial ownership of any shares of Common Stock as a result of such Distribution to such extent) and the portion of such Distribution
shall be held in abeyance for the benefit of the Holder until such time, if ever, as its right thereto would not result in the Holder
exceeding the Beneficial Ownership Limitation). To the extent that this Warrant has not been partially or completely exercised at the
time of such Distribution, such portion of the Distribution shall be held in abeyance for the benefit of the Holder until the Holder
has exercised this Warrant.
e)
Fundamental Transaction. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in one or
more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company, directly
or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of
its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer
(whether by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell, tender or exchange
their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding Common Stock,
(iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization or recapitalization
of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted into or exchanged for
other securities, cash or property, or (v) the Company, directly or indirectly, in one or more related transactions consummates a stock
or share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off
or scheme of arrangement) with another Person or group of Persons whereby such other Person or group acquires more than 50% of the outstanding
shares of Common Stock (not including any shares of Common Stock held by the other Person or other Persons making or party to, or associated
or affiliated with the other Persons making or party to, such stock or share purchase agreement or other business combination) (each
a “Fundamental Transaction”), then, upon any subsequent exercise of this Warrant, the Holder shall have the right
to receive, for each Warrant Share that would have been issuable upon such exercise immediately prior to the occurrence of such Fundamental
Transaction, at the option of the Holder (without regard to any limitation in Section 2(e) on the exercise of this Warrant), the number
of shares of Common Stock of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and any additional
consideration (the “Alternate Consideration”) receivable by holders of Common Stock as a result of such Fundamental
Transaction for each share of Common Stock for which this Warrant is exercisable immediately prior to such Fundamental Transaction (without
regard to any limitation in Section 2(e) on the exercise of this Warrant). For purposes of any such exercise, the determination of the
Exercise Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration
issuable in respect of one share of Common Stock in such Fundamental Transaction, and the Company shall apportion the Exercise Price
among the Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration.
If holders of Common Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then
the Holder shall be given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following such
Fundamental Transaction. The Company shall cause any successor entity in a Fundamental Transaction in which the Company is not the survivor
(the “Successor Entity”) to assume in writing all of the obligations of the Company under this Warrant in accordance
with the provisions of this Section 3(e) pursuant to written agreements in form and substance reasonably satisfactory to the Holder and
approved by the Holder (without unreasonable delay) prior to such Fundamental Transaction and shall, at the option of the Holder, deliver
to the Holder in exchange for this Warrant a security of the Successor Entity evidenced by a written instrument substantially similar
in form and substance to this Warrant which is exercisable for a corresponding number of shares of capital stock of such Successor Entity
(or its parent entity) equivalent to the shares of Common Stock acquirable and receivable upon exercise of this Warrant (without regard
to any limitations on the exercise of this Warrant) prior to such Fundamental Transaction, and with an exercise price which applies the
exercise price hereunder to such shares of capital stock (but taking into account the relative value of the shares of Common Stock pursuant
to such Fundamental Transaction and the value of such shares of capital stock, such number of shares of capital stock and such exercise
price being for the purpose of protecting the economic value of this Warrant immediately prior to the consummation of such Fundamental
Transaction), and which is reasonably satisfactory in form and substance to the Holder. Upon the occurrence of any such Fundamental Transaction,
the Successor Entity shall succeed to, and be substituted for (so that from and after the date of such Fundamental Transaction, the provisions
of this Warrant referring to the “Company” shall refer instead to the Successor Entity), and may exercise every right and
power of the Company and shall assume all of the obligations of the Company under this Warrant with the same effect as if such Successor
Entity had been named as the Company herein.
f)
Calculations. All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the
case may be. For purposes of this Section 3, the number of shares of Common Stock deemed to be issued and outstanding as of a given date
shall be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.
g)
Notice to Holder.
i.
Adjustment to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company
shall promptly mail to the Holder a notice setting forth the Exercise Price after such adjustment and any resulting adjustment to the
number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.
ii.
Notice to Allow Exercise by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on
the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C) the
Company shall authorize the granting to all holders of the Common Stock rights or warrants to subscribe for or purchase any shares of
capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall be required in connection with
any reclassification of the Common Stock, any consolidation or merger to which the Company is a party, any sale or transfer of all or
substantially all of the assets of the Company, or any compulsory share exchange whereby the Common Stock is converted into other securities,
cash or property, or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs
of the Company, then, in each case, the Company shall cause to be mailed a notice to the Holder at its last address as it shall appear
upon the Warrant Register of the Company, at least 20 calendar days prior to the applicable record or effective date hereinafter specified,
stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants,
or if a record is not to be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend, distributions,
redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale, transfer
or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the Common Stock
of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable upon such
reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to provide such notice or any defect
therein shall not affect the validity of the corporate action required to be specified in such notice. To the extent that any notice
provided hereunder constitutes, or contains, material, non-public information regarding the Company or any of the subsidiaries, the Company
shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K. The Holder shall remain entitled
to exercise this Warrant during the period commencing on the date of such notice to the effective date of the event triggering such notice
except as may otherwise be expressly set forth herein.
Section
4. Transfer of Warrant.
a)
Transferability. Pursuant to FINRA Rule 5110(e)(1), neither this Warrant nor any Warrant Shares issued upon exercise of this Warrant
shall be sold, transferred, assigned, pledged, or hypothecated, or be the subject of any hedging, short sale, derivative, put, or call
transaction that would result in the effective economic disposition of the securities by any person for a period of 180 days immediately
following the date of effectiveness or commencement of sales of the offering pursuant to which this Warrant is being issued, except the
transfer of any security:
i.
by operation of law or by reason of reorganization of the Company;
ii.
to any FINRA member firm participating in the offering and the officers or partners thereof, if all securities so transferred remain
subject to the lock-up restriction in this Section 4(a) for the remainder of the time period;
iii.
if the aggregate amount of securities of the Company held by the Holder or related person do not exceed 1% of the securities being offered;
iv.
that is beneficially owned on a pro-rata basis by all equity owners of an investment fund, provided that no participating member manages
or otherwise directs investments by the fund, and participating members in the aggregate do not own more than 10% of the equity in the
fund; or
v.
the exercise or conversion of any security, if all securities received remain subject to the lock-up restriction in this Section 4(a)
for the remainder of the time period.
Subject
to the foregoing restriction, any applicable securities laws and the conditions set forth in Section 4(d), this Warrant and all rights
hereunder (including, without limitation, any registration rights) are transferable, in whole or in part, upon surrender of this Warrant
at the principal office of the Company or its designated agent, together with a written assignment of this Warrant substantially in the
form attached hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon
the making of such transfer. Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant
or Warrants in the name of the assignee or assignees, as applicable, and in the denomination or denominations specified in such instrument
of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant
shall promptly be cancelled. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender
this Warrant to the Company unless the Holder has assigned this Warrant in full, in which case, the Holder shall surrender this Warrant
to the Company within three (3) Trading Days of the date the Holder delivers an assignment form to the Company assigning this Warrant
full. The Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for the purchase of Warrant Shares without
having a new Warrant issued.
b)
New Warrants. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of
the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by
the Holder or its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved in such division
or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided
or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the initial issuance date of
this Warrant and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto.
c)
Warrant Register. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the
“Warrant Register”), in the name of the record Holder hereof from time to time. The Company may deem and treat the
registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder,
and for all other purposes, absent actual notice to the contrary.
d)
Representation by the Holder. The Holder, by the acceptance hereof, represents and warrants that it is acquiring this Warrant
and, upon any exercise hereof, will acquire the Warrant Shares issuable upon such exercise, for its own account and not with a view to
or for distributing or reselling such Warrant Shares or any part thereof in violation of the Securities Act or any applicable state securities
law, except pursuant to sales registered or exempted under the Securities Act.
Section
5. Registration Rights.
5.1. Demand
Registration.
5.1.1
Grant of Right. The Company, upon written demand (a “Demand Notice”) of the Holder(s) of at least 51% of the Warrants and/or
the underlying Warrant Shares, agrees to register, on one (1) occasion, all or any portion of the Warrant Shares underlying the Warrants
(collectively, the “Registrable Securities”). On such occasion, the Company will file a registration statement with the Commission
covering the Registrable Securities within sixty (60) days after receipt of a Demand Notice and use its reasonable best efforts to have
the registration statement declared effective promptly thereafter, subject to compliance with review by the Commission; provided, however,
that the Company shall not be required to comply with a Demand Notice if the Company has filed a registration statement with respect
to which the Holder is entitled to piggyback registration rights pursuant to Section 5.2 hereof and either: (i) the Holder has elected
to participate in the offering covered by such registration statement or (ii) if such registration statement relates to an underwritten
primary offering of securities of the Company, until the offering covered by such registration statement has been withdrawn or until
thirty (30) days after such offering is consummated. The demand for registration may be made at any time beginning on the Initial Exercise
Date and expiring on the fifth anniversary of the date of the Underwriting Agreement (as defined below) in accordance with FINRA Rule
5110(g)(8)(C). The Company covenants and agrees to give written notice of its receipt of any Demand Notice by any Holder(s) to all other
registered Holders of the Warrants and/or the Registrable Securities within ten (10) days after the date of the receipt of any such Demand
Notice.
5.1.2
Terms. The Company shall bear all fees and expenses attendant to the registration of the Registrable Securities pursuant to Section 5.1.1,
but the Holders shall pay any and all underwriting commissions and the expenses of any legal counsel selected by the Holders to represent
them in connection with the sale of the Registrable Securities. The Company agrees to use its reasonable best efforts to cause the filing
required herein to become effective promptly and to qualify or register the Registrable Securities in such States as are reasonably requested
by the Holder(s); provided, however, that in no event shall the Company be required to register the Registrable Securities in a State
in which such registration would cause: (i) the Company to be obligated to register or license to do business in such State or submit
to general service of process in such State, or (ii) the principal shareholders of the Company to be obligated to escrow their shares
of capital stock of the Company. The Company shall cause any registration statement filed pursuant to the demand right granted under
Section 5.1.1 to remain effective for a period of at least twelve (12) consecutive months after the date that the Holders of the Registrable
Securities covered by such registration statement are first given the opportunity to sell all of such securities. The Holders shall only
use the prospectuses provided by the Company to sell the Warrant Shares covered by such registration statement, and will immediately
cease to use any prospectus furnished by the Company if the Company advises the Holder that such prospectus may no longer be used due
to a material misstatement or omission. Notwithstanding the provisions of this Section 5.1.2, the Holder shall be entitled to a demand
registration under Section 5.1.1 on only one (1) occasion and such demand registration right shall terminate on the fifth anniversary
of the date of the Underwriting Agreement (as defined below) in accordance with FINRA Rule 5110(g)(8)(C).
5.2
“Piggy-Back” Registration.
5.2.1
Grant of Right. In addition to the demand right of registration described in Section 5.1 hereof, the Holder shall have the right, for
a period of no more than two (2) years from the Initial Exercise Date in accordance with FINRA Rule 5110(g)(8)(D), to include the Registrable
Securities as part of any other registration of securities filed by the Company (other than in connection with a transaction contemplated
by Rule 145(a) promulgated under the Securities Act or pursuant to Form S-8 or Form S-4 or any equivalent form); provided, however, that
if, solely in connection with any primary underwritten public offering for the account of the Company, the managing underwriter(s) thereof
shall, in its reasonable discretion, impose a limitation on the number of Warrant Shares which may be included in the Registration Statement
because, in such underwriter(s)’ judgment, marketing or other factors dictate such limitation is necessary to facilitate public
distribution, then the Company shall be obligated to include in such Registration Statement only such limited portion of the Registrable
Securities with respect to which the Holder requested inclusion hereunder as the underwriter shall reasonably permit. Any exclusion of
Registrable Securities shall be made pro rata among the Holders seeking to include Registrable Securities in proportion to the number
of Registrable Securities sought to be included by such Holders; provided, however, that the Company shall not exclude any Registrable
Securities unless the Company has first excluded all outstanding securities, the holders of which are not entitled to inclusion of such
securities in such Registration Statement or are not entitled to pro rata inclusion with the Registrable Securities.
5.2.2
Terms. The Company shall bear all fees and expenses attendant to registering the Registrable Securities pursuant to Section 5.2.1 hereof,
but the Holders shall pay any and all underwriting commissions and the expenses of any legal counsel selected by the Holders to represent
them in connection with the sale of the Registrable Securities. In the event of such a proposed registration, the Company shall furnish
the then Holders of outstanding Registrable Securities with not less than thirty (30) days written notice prior to the proposed date
of filing of such registration statement. Such notice to the Holders shall continue to be given for each registration statement filed
by the Company during the two (2) year period following the Initial Exercise Date until such time as all of the Registrable Securities
have been sold by the Holder. The holders of the Registrable Securities shall exercise the “piggy-back” rights provided for
herein by giving written notice within ten (10) days of the receipt of the Company’s notice of its intention to file a registration
statement. Except as otherwise provided in this Warrant, there shall be no limit on the number of times the Holder may request registration
under this Section 5.2.1; provided, however, that such registration rights shall terminate on the second (2nd) anniversary
of the Initial Exercise Date.
5.3 General Terms
5.3.1
Indemnification. The Company shall indemnify the Holder(s) of the Registrable Securities to be sold pursuant to any registration statement
hereunder and each person, if any, who controls such Holders within the meaning of Section 15 of the Securities Act or Section 20(a)
of the Exchange Act against all loss, claim, damage, expense or liability (including all reasonable attorneys’ fees and other expenses
reasonably incurred in investigating, preparing or defending against any claim whatsoever) to which any of them may become subject under
the Securities Act, the Exchange Act or otherwise, arising from such registration statement but only to the same extent and with the
same effect as the provisions pursuant to which the Company has agreed to indemnify the Underwriters contained in Section 5.1 of the
Underwriting Agreement, dated [__], 2023, by and between the Company and ThinkEquity LLC as representatives of the underwriters set forth
therein (the “Underwriting Agreement”). The Holder(s) of the Registrable Securities to be sold pursuant to such registration
statement, and their successors and assigns, shall severally, and not jointly, indemnify the Company, against all loss, claim, damage,
expense or liability (including all reasonable attorneys’ fees and other expenses reasonably incurred in investigating, preparing
or defending against any claim whatsoever) to which they may become subject under the Securities Act, the Exchange Act or otherwise,
arising from information furnished by or on behalf of such Holders, or their successors or assigns, in writing, for specific inclusion
in such registration statement to the same extent and with the same effect as the provisions contained in Section 5.2 of the Underwriting
Agreement pursuant to which the Underwriters have agreed to indemnify the Company.
5.3.2
Exercise of Warrants. Nothing contained in this Warrant shall be construed as requiring the Holder(s) to exercise their Warrants prior
to or after the initial filing of any registration statement or the effectiveness thereof.
5.3.3
Documents Delivered to Holders. The Company shall furnish to each Holder participating in any of the foregoing offerings and to each
underwriter of any such offering, if any, a signed counterpart, addressed to such Holder or underwriter, of: (i) an opinion of counsel
to the Company, dated the effective date of such registration statement (and, if such registration includes an underwritten public offering,
an opinion dated the date of the closing under any underwriting agreement related thereto), and (ii) a “cold comfort” letter
dated the effective date of such registration statement (and, if such registration includes an underwritten public offering, a letter
dated the date of the closing under the underwriting agreement) signed by the independent registered public accounting firm which has
issued a report on the Company’s financial statements included in such registration statement, in each case covering substantially
the same matters with respect to such registration statement (and the prospectus included therein) and, in the case of such accountants’
letter, with respect to events subsequent to the date of such financial statements, as are customarily covered in opinions of issuer’s
counsel and in accountants’ letters delivered to underwriters in underwritten public offerings of securities. The Company shall
also deliver promptly to each Holder participating in the offering requesting the correspondence and memoranda described below and to
the managing underwriter, if any, copies of all correspondence between the Commission and the Company, its counsel or auditors and all
memoranda relating to discussions with the Commission or its staff with respect to the registration statement and permit each Holder
and underwriter to do such investigation, upon reasonable advance notice, with respect to information contained in or omitted from the
registration statement as it deems reasonably necessary to comply with applicable securities laws or rules of FINRA. Such investigation
shall include access to books, records and properties and opportunities to discuss the business of the Company with its officers and
independent auditors, all to such reasonable extent and at such reasonable times as any such Holder shall reasonably request.
5.3.4
Underwriting Agreement. The Company shall enter into an underwriting agreement with the managing underwriter(s), if any, selected by
any Holders whose Registrable Securities are being registered pursuant to this Section 5, which managing underwriter shall be reasonably
satisfactory to the Company. Such agreement shall be reasonably satisfactory in form and substance to the Company, each Holder and such
managing underwriters, and shall contain such representations, warranties and covenants by the Company and such other terms as are customarily
contained in agreements of that type used by the managing underwriter. The Holders shall be parties to any underwriting agreement relating
to an underwritten sale of their Registrable Securities and may, at their option, require that any or all the representations, warranties
and covenants of the Company to or for the benefit of such underwriters shall also be made to and for the benefit of such Holders. Such
Holders shall not be required to make any representations or warranties to or agreements with the Company or the underwriters except
as they may relate to such Holders, their Warrant Shares and their intended methods of distribution.
5.3.5
Documents to be Delivered by Holder(s). Each of the Holder(s) participating in any of the foregoing offerings shall furnish to the Company
a completed and executed questionnaire provided by the Company requesting information customarily sought of selling security holders.
5.3.6
Damages. Should the registration or the effectiveness thereof required by Sections 5.1 and 5.2 hereof be delayed by the Company or the
Company otherwise fails to comply with such provisions, the Holder(s) shall, in addition to any other legal or other relief available
to the Holder(s), be entitled to obtain specific performance or other equitable (including injunctive) relief against the threatened
breach of such provisions or the continuation of any such breach, without the necessity of proving actual damages and without the necessity
of posting bond or other security.
Section
6. Miscellaneous.
a)
No Rights as Stockholder Until Exercise. This Warrant does not entitle the Holder to any voting rights, dividends or other rights
as a stockholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i).
b)
Loss, Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any certificate relating to the Warrant Shares, and
in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant, shall
not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate, if mutilated, the Company
will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or
stock certificate.
c)
Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required
or granted herein shall not be a Trading Day, then, such action may be taken or such right may be exercised on the next succeeding Trading
Day.
d)
Authorized Shares.
The
Company covenants that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued Common Stock a
sufficient number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant.
The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are charged with
the duty of issuing the necessary Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company will take all
such reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided herein without violation of any
applicable law or regulation, or of any requirements of the Trading Market upon which the Common Stock may be listed. The Company covenants
that all Warrant Shares which may be issued upon the exercise of the purchase rights represented by this Warrant will, upon exercise
of the purchase rights represented by this Warrant and payment for such Warrant Shares in accordance herewith, be duly authorized, validly
issued, fully paid and nonassessable and free from all taxes, liens and charges created by the Company in respect of the issue thereof
(other than taxes in respect of any transfer occurring contemporaneously with such issue).
Except
and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending
its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale
of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant,
but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary
or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without limiting the generality of the
foregoing, the Company will (i) not increase the par value of any Warrant Shares above the amount payable therefor upon such exercise
immediately prior to such increase in par value, (ii) take all such action as may be necessary or appropriate in order that the Company
may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant and (iii) use commercially
reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof,
as may be, necessary to enable the Company to perform its obligations under this Warrant.
Before
taking any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the
Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from
any public regulatory body or bodies having jurisdiction thereof.
e)
Jurisdiction. All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be determined
in accordance with the provisions of the Underwriting Agreement.
f)
Restrictions. The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, and
the Holder does not utilize cashless exercise, will have restrictions upon resale imposed by state and federal securities laws.
g)
Nonwaiver and Expenses. No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall
operate as a waiver of such right or otherwise prejudice the Holder’s rights, powers or remedies. Without limiting any other provision
of this Warrant or the Underwriting Agreement, if the Company willfully and knowingly fails to comply with any provision of this Warrant,
which results in any material damages to the Holder, the Company shall pay to the Holder such amounts as shall be sufficient to cover
any costs and expenses including, but not limited to, reasonable attorneys’ fees, including those of appellate proceedings, incurred
by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.
h)
Notices. Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company shall
be delivered in accordance with the notice provisions of the Underwriting Agreement.
i)
Limitation of Liability. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant
to purchase Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of
the Holder for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability is asserted by the Company
or by creditors of the Company.
j)
Remedies. The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will
be entitled to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate
compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to
assert the defense in any action for specific performance that a remedy at law would be adequate.
k)
Successors and Assigns. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall
inure to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns
of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and shall
be enforceable by the Holder or holder of Warrant Shares.
l)
Amendment. This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and
the Holder.
m)
Severability. Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall
be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining
provisions of this Warrant.
n)
Headings. The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed
a part of this Warrant.
********************
(Signature
Page Follows)
IN
WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above
indicated.
|
Tharimmune, Inc. |
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By: |
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Name: |
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Title: |
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NOTICE
OF EXERCISE
TO: Tharimmune,
Inc.
_________________________
(1)
The undersigned hereby elects to purchase ________ Warrant Shares of the Company pursuant to the terms of the attached Warrant (only
if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.
(2)
Payment shall take the form of (check applicable box):
☐
in lawful money of the United States; or
☐
if permitted the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in
subsection 2(c), to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless
exercise procedure set forth in subsection 2(c).
(3)
Please register and issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:
_______________________________
The
Warrant Shares shall be delivered to the following DWAC Account Number or by physical delivery of a certificate to:
_______________________________
_______________________________
_______________________________
(4)
Accredited Investor. The undersigned is an “accredited investor” as defined in Regulation D promulgated under the
Securities Act of 1933, as amended
[SIGNATURE
OF HOLDER]
Name
of Investing Entity: _______________________________________________________________
Signature
of Authorized Signatory of Investing Entity: _________________________________________
Name
of Authorized Signatory: ___________________________________________________________
Title
of Authorized Signatory: ____________________________________________________________
Date:
________________________________________________________________________________
ASSIGNMENT
FORM
(To
assign the foregoing warrant, execute
this form and supply required information.
Do not use this form to exercise the warrant.)
FOR
VALUE RECEIVED, [____] all of or [_______] shares of the foregoing Warrant and all rights evidenced thereby are hereby assigned to
_______________________________________________
whose address is
_______________________________________________________________.
_______________________________________________________________
Dated:
______________, _______
Holder’s
Signature: _____________________________
Holder’s
Address: _____________________________
_____________________________
NOTE:
The signature to this Assignment Form must correspond with the name as it appears on the face of the Warrant, without alteration or enlargement
or any change whatsoever. Officers of corporations and those acting in a fiduciary or other representative capacity should file proper
evidence of authority to assign the foregoing Warrant.
Exhibit
4.4
FORM
OF PRE-FUNDED COMMON STOCK PURCHASE WARRANT
THARIMMUNE,
INC.
Warrant
Shares: _______ |
|
|
Issue
Date: [_], 2023 |
THIS
PRE-FUNDED COMMON STOCK PURCHASE WARRANT (the “Warrant”) certifies that, for value received, _____________ or its
assigns (the “Holder”) is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter
set forth, at any time on or after the Issue Date and until this Warrant is exercised in full (the “Termination Date”)
but not thereafter, to subscribe for and purchase from Tharimmune, Inc. (formerly Hillstream BioPharma, Inc.), a Delaware corporation
(the “Company”), up to ______ shares of Common Stock (as subject to adjustment hereunder, the “Warrant Shares”).
The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price, as defined in Section 2(b).
Section
1. Definitions. In addition to the terms defined elsewhere in this Warrant, the following terms have the meanings indicated
in this Section 1:
“Affiliate”
means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control
with a Person, as such terms are used in and construed under Rule 405 under the Securities Act.
“Commission”
means the United States Securities and Exchange Commission.
“Common
Stock” means the common stock of the Company, par value $0.0001 per share, and any other class of securities into which such
securities may hereafter be reclassified or changed.
“Common
Stock Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to acquire
at any time Common Stock, including, without limitation, any debt, preferred stock, right, option, warrant or other instrument that is
at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Stock.
“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
“Liens”
means a lien, charge pledge, security interest, encumbrance, right of first refusal, preemptive right or other restriction.
“Person”
means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.
“Proceeding”
means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial proceeding,
such as a deposition), whether commenced or threatened.
“Registration
Statement” means the Company’s registration statement on Form S-1 (File No. 333-[__]).
“Rule
144” means Rule 144 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted
from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect
as such Rule.
“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Trading
Day” means a day on which the Common Stock is traded on a Trading Market.
“Trading
Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date
in question: the OTCQB, OTCQX or Pink Open Market operated by OTC Markets Group, the NYSE American, the Nasdaq Capital Market, the Nasdaq
Global Market, the Nasdaq Global Select Market, or the New York Stock Exchange (or any successors to any of the foregoing).
“Transfer
Agent” means Pacific Stock Transfer Company, 6725 Via Austi Parkway, Suite 300, Las Vegas, Nevada 89119, and any successor
transfer agent of the Company.
“Warrants”
means this Warrant and other Pre-Funded Common Stock Purchase Warrants issued by the Company pursuant to the Registration Statement.
Section
2. Exercise.
a)
Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on or after the Issue
Date and on or before the Termination Date by delivery to the Company of a duly executed facsimile copy (or e-mail attachment) of the
Notice of Exercise in the form annexed hereto (the “Notice of Exercise”). Within the earlier of (i) two (2) Trading
Days and (ii) the number of Trading Days comprising the Standard Settlement Period (as defined in Section 2(d)(i) herein) following the
date of exercise as aforesaid, the Holder shall deliver to the Company the aggregate Exercise Price for the Warrant Shares specified
in the applicable Notice of Exercise by wire transfer or cashier’s check drawn on a United States bank unless the cashless exercise
procedure specified in Section 2(c) below is specified in the applicable Notice of Exercise. No ink-original Notice of Exercise shall
be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise form be required.
Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company
until the Holder has purchased all of the Warrant Shares available hereunder and the Warrant has been exercised in full, in which case,
the Holder shall surrender this Warrant to the Company for cancellation within three (3) Trading Days of the date on which the final
Notice of Exercise is delivered to the Company. Partial exercises of this Warrant resulting in purchases of a portion of the total number
of Warrant Shares available hereunder shall have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder
in an amount equal to the applicable number of Warrant Shares purchased in connection with such partial exercise. The Holder and the
Company shall maintain records showing the number of Warrant Shares purchased and the date of such purchases. The Company shall deliver
any objection to any Notice of Exercise within one (1) Trading Day of receipt of such notice. The Holder and any assignee, by acceptance
of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase of a portion of the
Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any given time may be less than the amount
stated on the face hereof.
b)
Exercise Price. The aggregate exercise price of this Warrant, except for a nominal exercise price of $0.001 per Warrant Share,
was pre-funded to the Company on or prior to the Issue Date and, consequently, no additional consideration (other than the nominal exercise
price of $0.001 per Warrant Share) shall be required to be paid by the Holder to any Person to effect any exercise of this Warrant. The
Holder shall not be entitled to the return or refund of all, or any portion, of such pre-paid aggregate exercise price under any circumstance
or for any reason whatsoever, including in the event this Warrant shall not have been exercised prior to the Termination Date. The remaining
unpaid exercise price per share of Common Stock under this Warrant shall be $0.001, subject to adjustment hereunder (the “Exercise
Price”).
c)
Cashless Exercise. This Warrant may also be exercised, in whole or in part, at such time by means of a “cashless exercise”
in which the Holder shall be entitled to receive a number of Warrant Shares for the deemed surrender of the Warrant in whole or in part
equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:
|
(A)
= |
as
applicable: (i) the Closing Sale Price of the Common Stock on the Trading Day immediately preceding the date of the applicable Notice
of Exercise if such Notice of Exercise is (1) both executed and delivered pursuant to Section 2(a) hereof on a day that is not a
Trading Day or (2) both executed and delivered pursuant to Section 2(a) hereof on a Trading Day prior to the opening of “regular
trading hours” (as defined in Rule 600(b)(68) of Regulation NMS promulgated under the federal securities laws) on such Trading
Day, (ii) at the option of the Holder, either (x) the VWAP on the Trading Day immediately preceding the date of the applicable Notice
of Exercise or (y) the Bid Price of the Common Stock as of the time of the Holder’s execution of the applicable Notice of Exercise
if such Notice of Exercise is executed during “regular trading hours” on a Trading Day and is delivered within two (2)
hours thereafter pursuant to Section 2(a) hereof (including until two (2) hours after the close of “regular trading hours”
on a Trading Day), or (iii) the Closing Sale Price of the Common Stock on the date of the applicable Notice of Exercise if the date
of such Notice of Exercise is a Trading Day and such Notice of Exercise is both executed and delivered pursuant to Section 2(a) hereof
after the close of “regular trading hours” on such Trading Day; |
|
(B)
= |
the
Exercise Price of this Warrant, as adjusted hereunder; and |
|
|
|
|
(X)
= |
the
number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such
exercise were by means of a cash exercise rather than a cashless exercise. |
The
issue price for each such Warrant Share to be issued pursuant to the cashless exercise of a Warrant will be equal to (B), as defined
above, and the total issue price for the aggregate number of Warrant Shares issued pursuant to the cashless exercise of a Warrant will
be deemed paid and satisfied in full by the deemed surrender to the Company of the portion of such Warrant being exercised in accordance
with this Section 1(c). Notwithstanding anything herein to the contrary, the Company shall not be required to make any cash payments
or net cash settlement to the Holder in lieu of delivery of the Warrant Shares. If Warrant Shares are issued in such a cashless exercise,
the parties acknowledge and agree that in accordance with Section 3(a)(9) of the Securities Act, the Warrant Shares shall take on the
registered characteristics of the Warrants being exercised. The Company agrees not to take any position contrary to this Section 2(c).
“Bid
Price” means, for any security as of the particular time of determination, the bid price for such security on the Trading Market
as reported by Bloomberg as of such time of determination, or, if the Trading Market is not the principal securities exchange or trading
market for such security, the bid price of such security on the principal securities exchange or trading market where such security is
listed or traded as reported by Bloomberg as of such time of determination, or if the foregoing does not apply, the bid price of such
security in the over-the-counter market on the electronic bulletin board for such security as reported by Bloomberg as of such time of
determination, or, if no bid price is reported for such security by Bloomberg as of such time of determination, the average of the bid
prices of any market makers for such security as reported on the Pink Open Market as of such time of determination. If the Bid Price
cannot be calculated for a security as of the particular time of determination on any of the foregoing bases, the Bid Price of such security
as of such time of determination shall be the fair market value as mutually determined by the Company and the Holder. If the Company
and the Holder are unable to agree upon the fair market value of such security, then such fair market value shall be determined pursuant
to the provisions set forth in clause (d) of the definition of VWAP. All such determinations to be appropriately adjusted for any stock
dividend, share split, share consolidation, reclassification or other similar transaction during the applicable calculation period.
“Closing
Sale Price” means, for any security as of any date, the last closing trade price for such security on the Trading Market, as
reported by Bloomberg, or, if the Trading Market begins to operate on an extended hours basis and does not designate the closing trade
price, then the last trade price of such security prior to 4:00:00 p.m., New York time, as reported by Bloomberg, or, if the Trading
Market is not the principal securities exchange or trading market for such security, the last trade price of such security on the principal
securities exchange or trading market where such security is listed or traded as reported by Bloomberg, or if the foregoing do not apply,
the last trade price of such security in the over-the-counter market on the electronic bulletin board for such security as reported by
Bloomberg, or, if no last trade price is reported for such security by Bloomberg, the average of the ask prices of any market makers
for such security as reported on the in the OTC Link or on the Pink Open Market. If the Closing Sale Price cannot be calculated for a
security on a particular date on any of the foregoing bases, Closing Sale Price of such security on such date shall be the fair market
value as mutually determined by the Company and the Holder. If the Company and the Holder are unable to agree upon the fair market value
of such security, then such fair market value shall be determined pursuant to the provisions set forth in clause (d) of the definition
of VWAP. All such determinations to be appropriately adjusted for any stock dividend, share split, share consolidation, reclassification
or other similar transaction during the applicable calculation period.
“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed
or quoted for trading on a Trading Market other than the OTCQB, OTCQX or Pink Open Market operated by OTC Markets Group, the daily volume
weighted average price of the Common Stock for such date (or the nearest preceding date) on the Trading Market on which the Common Stock
is then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New
York City time)), (b) if the Common Stock is then quoted for trading on the OTCQB or OTCQX operated by OTC Markets Group, the volume
weighted average price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, or (c) in all
other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good faith by the
holders of a majority in interest of the Warrants then outstanding and reasonably acceptable to the Company, the fees and expenses of
which shall be paid by the Company.
d)
Mechanics of Exercise.
i.
Delivery of Warrant Shares Upon Exercise. The Company shall cause the Warrant Shares purchased hereunder to be transmitted by
the Transfer Agent to the Holder by crediting the account of the Holder’s or its designee’s balance account with The Depository
Trust Company through its Deposit or Withdrawal at Custodian system (the “DWAC”) if the Company is then a participant
in such system and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or resale
of the Warrant Shares by the Holder or (B) this Warrant is being exercised via cashless exercise, and otherwise by physical delivery
of a certificate, registered in the Company’s share register in the name of the Holder or its designee, for the number of Warrant
Shares to which the Holder is entitled pursuant to such exercise to the address specified by the Holder in the Notice of Exercise by
the date that is the earlier of (i) two (2) Trading Days and (ii) the number of Trading Days comprising the Standard Settlement Period
after the delivery to the Company of the Notice of Exercise (such date, the “Warrant Share Delivery Date”). Upon delivery
of the Notice of Exercise, the Holder shall be deemed for all corporate purposes to have become the Holder of record of the Warrant Shares
with respect to which this Warrant has been exercised, irrespective of the date of delivery of the Warrant Shares, provided that payment
of the aggregate Exercise Price (other than in the case of a cashless exercise) is received within the earlier of (i) two (2) Trading
Days after the delivery to the Company of the Notice of Exercise and (ii) the number of Trading Days comprising the Standard Settlement
Period following delivery of the Notice of Exercise. If the Company fails for any reason to deliver to the Holder the Warrant Shares
subject to a Notice of Exercise by the Warrant Share Delivery Date, the Company shall pay to the Holder, in cash, as liquidated damages
and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on the VWAP of the Common Stock on the date of
the applicable Notice of Exercise), $10 per Trading Day (increasing to $20 per Trading Day on the third Trading Day after the Warrant
Share Delivery Date) for each Trading Day after such Warrant Share Delivery Date until such Warrant Shares are delivered to said Holder
or the Holder rescinds such exercise. The Company agrees to maintain a Transfer Agent that is a participant in the Fast Automated Securities
Transfer or FAST program so long as this Warrant remains outstanding and exercisable. As used herein, “Standard Settlement Period”
means the standard settlement period, expressed in a number of Trading Days, on the Company’s primary Trading Market with respect
to the Common Stock as in effect on the date of delivery of the Notice of Exercise. Notwithstanding the foregoing, with respect to any
Notice(s) of Exercise delivered on or prior to 12:00 p.m. (New York City time) on the Issue Date, which may be delivered at any time
after the time of execution of the Underwriting Agreement, dated [__], 2023 between the Company and ThinkEquity LLC, the Company agrees
to deliver the Warrant Shares subject to such notice(s) by 4:00 p.m. (New York City time) on the Issue Date.
ii.
Delivery of New Warrants Upon Exercise. If this Warrant shall have been exercised in part, the Company shall, at the request of
a Holder and upon surrender of this Warrant certificate, at the time of delivery of the Warrant Shares, deliver to the Holder a new Warrant
evidencing the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in
all other respects be identical with this Warrant.
iii.
Rescission Rights. If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to Section
2(d)(i) by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise.
iv.
Compensation for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise. In addition to any other rights available to
the Holder, if the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares in accordance with the provisions
of Section 2(d)(i) above pursuant to an exercise on or before the Warrant Share Delivery Date, and if after such date the Holder is required
by its broker to purchase (in an open market transaction or otherwise) or the Holder’s brokerage firm otherwise purchases, shares
of Common Stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon
such exercise (a “Buy-In”), then the Company shall (A) pay in cash to the Holder the amount, if any, by which (x)
the Holder’s total purchase price (including brokerage commissions, if any) for the shares of Common Stock so purchased exceeds
(y) the amount obtained by multiplying (1) the number of Warrant Shares that the Company was required to deliver to the Holder in connection
with the exercise at issue by (2) the price at which the sell order giving rise to such purchase obligation was executed, and (B) at
the option of the Holder, either reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such exercise
was not honored (in which case such exercise shall be deemed rescinded) or deliver to the Holder the number of shares of Common Stock
that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if the
Holder purchases shares of Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise
of Common Stock with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (A) of the immediately
preceding sentence the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating
the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence of the amount of such loss. 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 shares
of Common Stock upon exercise of the Warrant as required pursuant to the terms hereof.
v.
No Fractional Shares or Scrip. No fractional shares or scrip representing fractional shares shall be issued upon the exercise
of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the Company
shall, at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied
by the Exercise Price or round up to the next whole share.
vi.
Charges, Taxes and Expenses. Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax
or other incidental expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses shall be paid by the Company,
and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; provided,
however, that in the event that Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant when
surrendered for exercise shall be accompanied by the Assignment Form attached hereto duly executed by the Holder and the Company may
require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto. The Company
shall pay all Transfer Agent fees required for same-day processing of any Notice of Exercise and all fees to the Depository Trust Company
(or another established clearing corporation performing similar functions) required for same-day electronic delivery of the Warrant Shares.
vii.
Closing of Books. The Company shall not close its stockholder books or records in any manner which prevents the timely exercise
of this Warrant, pursuant to the terms hereof.
e)
Holder’s Exercise Limitations. The Company shall not effect any exercise of this Warrant, and a Holder shall not have the
right to exercise any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect to such issuance
after exercise as set forth on the applicable Notice of Exercise, the Holder (together with the Holder’s Affiliates, and any other
Persons acting as a group together with the Holder or any of the Holder’s Affiliates (such Persons, “Attribution Parties”)),
would beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence, the
number of shares of Common Stock beneficially owned by the Holder and its Affiliates and Attribution Parties shall include the number
of shares of Common Stock issuable upon exercise of this Warrant with respect to which such determination is being made, but shall exclude
the number of shares of Common Stock which would be issuable upon (i) exercise of the remaining, non-exercised portion of this Warrant
beneficially owned by the Holder or any of its Affiliates or Attribution Parties and (ii) exercise or conversion of the unexercised or
non-converted portion of any other securities of the Company (including, without limitation, any other Common Stock Equivalents) subject
to a limitation on conversion or exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its
Affiliates or Attribution Parties. Except as set forth in the preceding sentence, for purposes of this Section 2(e), beneficial ownership
shall be calculated in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder, it being
acknowledged by the Holder that the Company is not representing to the Holder that such calculation is in compliance with Section 13(d)
of the Exchange Act and the Holder is solely responsible for any schedules required to be filed in accordance therewith. To the extent
that the limitation contained in this Section 2(e) applies, the determination of whether this Warrant is exercisable (in relation to
other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable
shall be in the sole discretion of the Holder, and the submission of a Notice of Exercise shall be deemed to be the Holder’s determination
of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates and Attribution
Parties) and of which portion of this Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Company
shall have no obligation to verify or confirm the accuracy of such determination. In addition, a determination as to any group status
as contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated
thereunder. For purposes of this Section 2(e), in determining the number of outstanding shares of Common Stock, a Holder may rely on
the number of outstanding shares of Common Stock as reflected in (A) the Company’s most recent periodic or annual report filed
with the Commission, as the case may be, (B) a more recent public announcement by the Company or (C) a more recent written notice by
the Company or the Transfer Agent setting forth the number of shares of Common Stock outstanding. Upon the written or oral request of
a Holder, the Company shall within two Trading Days confirm orally and in writing to the Holder the number of shares of Common Stock
then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion
or exercise of securities of the Company, including this Warrant, by the Holder or its Affiliates or Attribution Parties since the date
as of which such number of outstanding shares of Common Stock was reported. The “Beneficial Ownership Limitation”
shall be 4.99% (or, upon election by a Holder prior to the issuance of any Warrants, 9.99%) of the number of shares of Common Stock outstanding
immediately after giving effect to the issuance of Common Stock issuable upon exercise of this Warrant. The Holder, upon notice to the
Company, may increase or decrease the Beneficial Ownership Limitation provisions of this Section 2(e), provided that the Beneficial Ownership
Limitation in no event exceeds 9.99% of the number of shares of Common Stock outstanding immediately after giving effect to the issuance
of Common Stock upon exercise of this Warrant held by the Holder and the provisions of this Section 2(e) shall continue to apply. Any
increase in the Beneficial Ownership Limitation will not be effective until the 61st day after such notice is delivered to
the Company. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with
the terms of this Section 2(e) to correct this paragraph (or any portion hereof) which may be defective or inconsistent with the intended
Beneficial Ownership Limitation herein contained or to make changes or supplements necessary or desirable to properly give effect to
such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Warrant.
Section
3. Certain Adjustments.
a)
Stock Dividends and Splits. If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend or otherwise
makes a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities payable in shares
of Common Stock (which, for avoidance of doubt, shall not include any Common Stock issued by the Company upon exercise of this Warrant),
(ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines (including by way of reverse stock
split or consolidation) outstanding Common Stock into a smaller number of shares, or (iv) issues by reclassification of shares of Common
Stock any shares of the Company, then in each case the Exercise Price shall be multiplied by a fraction of which the numerator shall
be the number of shares of Common Stock (excluding treasury shares, if any) outstanding immediately before such event and of which the
denominator shall be the number of shares of Common Stock outstanding immediately after such event, and the number of shares issuable
upon exercise of this Warrant shall be proportionately adjusted such that the aggregate Exercise Price of this Warrant shall remain unchanged.
Any adjustment made pursuant to this Section 3(a) shall become effective immediately after the record date for the determination of stockholders
entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision,
combination or re-classification.
b)
Subsequent Rights Offerings. In addition to any adjustments pursuant to Section 3(a) above, if at any time the Company grants,
issues or sells any Common Stock Equivalents or rights to purchase stock, warrants, securities or other property pro rata to the record
holders of shares of Common Stock (the “Purchase Rights”), then the Holder will be entitled to acquire, upon the terms
applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had held the number
of shares of Common Stock acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including
without limitation, the Beneficial Ownership Limitation) immediately before the date on which a record is taken for the grant, issuance
or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares of Common Stock are
to be determined for the grant, issue or sale of such Purchase Rights (provided, however, to the extent that the Holder’s right
to participate in any such Purchase Right would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall
not be entitled to participate in such Purchase Right to such extent (or beneficial ownership of such shares of Common Stock as a result
of such Purchase Right to such extent) and such Purchase Right to such extent shall be held in abeyance for the Holder until such time,
if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).
c)
Pro Rata Distributions. During such time as this Warrant is outstanding, if the Company shall declare or make any dividend or
other distribution of its assets (or rights to acquire its assets) to holders of shares of Common Stock, by way of return of capital
or otherwise (including, without limitation, any distribution of cash, stock or other securities, property or options by way of a dividend,
spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a “Distribution”),
at any time after the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution
to the same extent that the Holder would have participated therein if the Holder had held the number of shares of Common Stock acquirable
upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial
Ownership Limitation) immediately before the date of which a record is taken for such Distribution, or, if no such record is taken, the
date as of which the record holders of shares of Common Stock are to be determined for the participation in such Distribution (provided,
however, to the extent that the Holder’s right to participate in any such Distribution would result in the Holder exceeding
the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Distribution to such extent (or in
the beneficial ownership of any shares of Common Stock as a result of such Distribution to such extent) and the portion of such Distribution
shall be held in abeyance for the benefit of the Holder until such time, if ever, as its right thereto would not result in the Holder
exceeding the Beneficial Ownership Limitation).
d)
Fundamental Transaction. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in one or
more related transactions effects any merger or amalgamation or consolidation of the Company with or into another Person, (ii) the Company,
directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially
all of its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange
offer (whether by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell, tender
or exchange their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding
shares of Common Stock or 50% or more of the voting power of the common equity of the Company, (iv) the Company, directly or indirectly,
in one or more related transactions effects any reclassification, reorganization or recapitalization of shares of Common Stock or any
compulsory share exchange pursuant to which shares of Common Stock are effectively converted into or exchanged for other securities,
cash or property, or (v) the Company, directly or indirectly, in one or more related transactions consummates a share purchase agreement
or other business combination (including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement)
with another Person or group of Persons whereby such other Person or group acquires more than 50% of the outstanding shares of Common
Stock or more of the outstanding Common Stock or 50% or more of the voting power of the common equity of the Company (each a “Fundamental
Transaction”), then, upon any subsequent exercise of this Warrant, the Holder shall have the right to receive, for each Warrant
Share that would have been issuable upon such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option
of the Holder (without regard to any limitation in Section 2(e) on the exercise of this Warrant), the number of shares of Common Stock
of the successor or acquiring corporation or of the Company, if it is the surviving corporation or is otherwise the continuing corporation,
and any additional consideration (the “Alternate Consideration”) receivable as a result of such Fundamental Transaction
by a holder of the number of shares of Common Stock for which this Warrant is exercisable immediately prior to such Fundamental Transaction
(without regard to any limitation in Section 2(e) on the exercise of this Warrant). For purposes of any such exercise, the determination
of the Exercise Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration
issuable in respect of shares of Common Stock in such Fundamental Transaction, and the Company shall apportion the Exercise Price among
the Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration.
If holders of Common Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then
the Holder shall be given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following such
Fundamental Transaction. The Company shall cause any successor entity in a Fundamental Transaction in which the Company is not the survivor
(the “Successor Entity”) to assume in writing all of the obligations of the Company under this Warrant in accordance
with the provisions of this Section 3(d) pursuant to written agreements prior to such Fundamental Transaction and shall, at the option
of the Holder, deliver to the Holder in exchange for this Warrant a security of the Successor Entity evidenced by a written instrument
substantially similar in form and substance to this Warrant which is exercisable for a corresponding number of shares or other securities
of such Successor Entity (or its parent entity) equivalent to the shares of Common Stock acquirable and receivable upon exercise of this
Warrant (without regard to any limitations on the exercise of this Warrant) prior to such Fundamental Transaction, and with an exercise
price which applies the exercise price hereunder to such shares of or other securities (but taking into account the relative value of
the shares of Common Stock pursuant to such Fundamental Transaction and the value of such shares or securities, such number of shares
or securities and such exercise price being for the purpose of protecting the economic value of this Warrant immediately prior to the
consummation of such Fundamental Transaction). Upon the occurrence of any such Fundamental Transaction, the Successor Entity shall succeed
to, and be substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this Warrant referring
to the “Company” shall refer instead to the Successor Entity), and may exercise every right and power of the Company and
shall assume all of the obligations of the Company under this Warrant with the same effect as if such Successor Entity had been named
as the Company herein.
e)
Calculations. All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the
case may be. For purposes of this Section 3, the number of shares of Common Stock deemed to be issued and outstanding as of a given date
shall be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.
f)
Notice to Holder.
i.
Adjustment to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company
shall promptly deliver to the Holder by facsimile or email a notice setting forth the Exercise Price after such adjustment and any resulting
adjustment to the number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.
ii.
Notice to Allow Exercise by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on
the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C) the
Company shall authorize the granting to all holders of the shares of Common Stock rights or warrants to subscribe for or purchase any
shares of the Company or of any rights, (D) the approval of any stockholders of the Company shall be required in connection with any
reclassification of the Common Stock, any consolidation or merger, amalgamation or arrangement to which the Company is a party, any sale
or transfer of all or substantially all of the assets of the Company, or any compulsory share exchange whereby the Common Stock is converted
into other securities, cash or property, or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation or
winding up of the affairs of the Company, then, in each case, the Company shall cause to be delivered by facsimile or email to the Holder
at its last facsimile number or email address as it shall appear upon the Warrant Register of the Company, at least 20 calendar days
prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date on which a record is to be taken
for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which
the holders of the Common Stock of record to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined
or (y) the date on which such reclassification, consolidation, merger, amalgamation, arrangement, sale, transfer or share exchange is
expected to become effective or close, and the date as of which it is expected that holders of the Common Stock of record shall be entitled
to exchange their shares of Common Stock for securities, cash or other property deliverable upon such reclassification, consolidation,
merger, amalgamation, arrangement sale, transfer or share exchange; provided that the failure to deliver such notice or any defect therein
or in the delivery thereof shall not affect the validity of the corporate action required to be specified in such notice. To the extent
that any notice provided in this Warrant constitutes, or contains, material, non-public information regarding the Company or any of its
subsidiaries (the “Subsidiaries”), the Company shall simultaneously file such notice with the Commission pursuant
to a Current Report on Form 8-K. The Holder shall remain entitled to exercise this Warrant during the period commencing on the date of
such notice to the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.
Section
4. Transfer of Warrant.
a)
Transferability. This Warrant and all rights hereunder are transferable, in whole or in part, upon surrender of this Warrant at
the principal office of the Company or its designated agent, together with a written assignment of this Warrant substantially in the
form attached hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon
the making of such transfer. Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant
or Warrants in the name of the assignee or assignees, as applicable, and in the denomination or denominations specified in such instrument
of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant
shall promptly be cancelled. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender
this Warrant to the Company unless the Holder has assigned this Warrant in full, in which case, the Holder shall surrender this Warrant
to the Company within three (3) Trading Days of the date on which the Holder delivers an assignment form to the Company assigning this
Warrant in full. This Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for the purchase of Warrant
Shares without having a new Warrant issued.
b)
New Warrants. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of
the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by
the Holder or its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved in such division
or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided
or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the original Issue Date of this
Warrant and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto.
c)
Warrant Register. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the
“Warrant Register”), in the name of the record Holder hereof from time to time. The Company may deem and treat the
registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder,
and for all other purposes, absent actual notice to the contrary.
Section
5. Miscellaneous.
a)
No Rights as Stockholder Until Exercise. This Warrant does not entitle the Holder to any voting rights, dividends or other rights
as a stockholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i), except as expressly set forth in Section
3. Without limiting any rights of a Holder to receive Warrant Shares on a “cashless exercise”
pursuant to Section 2(c) or to receive cash payments pursuant to Section 2(d)(i) and Section 2(d)(iv) herein, in no event, including
if the Company is for any reason unable to issue and deliver Warrant Shares upon exercise of this Warrant as required pursuant to the
terms thereof, shall the Company be required to net cash settle an exercise of this Warrant.
b)
Loss, Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant Shares,
and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which shall in no event include the
posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate, if mutilated, the Company shall make
and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or stock certificate.
c)
Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required
or granted herein shall not be a Trading Day, then, such action may be taken or such right may be exercised on the next succeeding Trading
Day.
d)
Authorized Shares.
The
Company covenants that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued shares of Common
Stock a sufficient number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under
this Warrant. The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are
charged with the duty of issuing the necessary Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company
shall take all such reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided herein without
violation of any applicable law or regulation, or of any requirements of the Trading Market upon which the Common Stock may be listed
or quoted for trading. The Company covenants that all Warrant Shares which may be issued upon the exercise of the purchase rights represented
by this Warrant will, upon exercise of the purchase rights represented by this Warrant and payment for such Warrant Shares in accordance
herewith, be duly authorized, validly issued, fully paid and non-assessable and free from all taxes, liens and charges created by the
Company in respect of the issue thereof (other than taxes in respect of any transfer occurring contemporaneously with such issue).
Except
and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending
its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, amalgamation, arrangement
dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of
the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all
such actions as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without
limiting the generality of the foregoing, the Company shall (i) not increase the par value of any Warrant Shares above the amount payable
therefor upon such exercise immediately prior to such increase in par value, (ii) take all such action as may be necessary or appropriate
in order that the Company may validly and legally issue fully paid and non-assessable Warrant Shares upon the exercise of this Warrant
and (iii) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory body
having jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under this Warrant.
Before
taking any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the
Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from
any public regulatory body or bodies having jurisdiction thereof.
e)
Governing Law. All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be governed
by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflict
of laws thereof. Each party agrees that all legal Proceedings concerning the interpretation, enforcement and defense of this Warrant
shall be commenced in the state and federal courts sitting in the City of New York, Borough of Manhattan (the “New York Courts”).
Each party hereto hereby irrevocably submits to the exclusive jurisdiction of the New York Courts for the adjudication of any dispute
hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein (including with respect to the enforcement
of any provision hereunder), and hereby irrevocably waives, and agrees not to assert in any suit, action or Proceeding, any claim that
it is not personally subject to the jurisdiction of such New York Courts, or such New York Courts are improper or inconvenient venue
for such Proceeding. If any party shall commence an action or Proceeding to enforce any provisions of this Warrant, then the prevailing
party in such action or Proceeding shall be reimbursed by the other party for its attorneys’ fees and other costs and expenses
incurred in the investigation, preparation and prosecution of such action or Proceeding.
f)
Restrictions. The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, and
the Holder does not utilize cashless exercise, will have restrictions upon resale imposed by state and federal securities laws.
g)
Nonwaiver and Expenses. No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall
operate as a waiver of such right or otherwise prejudice the Holder’s rights, powers or remedies. Without limiting any other provision
of this Warrant, if the Company willfully and knowingly fails to comply with any provision of this Warrant, which results in any material
damages to the Holder, the Company shall pay to the Holder such amounts as shall be sufficient to cover any costs and expenses including,
but not limited to, reasonable attorneys’ fees, including those of appellate Proceedings, incurred by the Holder in collecting
any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.
h)
Notices. Any and all notices or other communications or deliveries to be provided by the Holders hereunder including, without
limitation, any Notice of Exercise, shall be in writing and delivered personally, by facsimile or by e-mail, or sent by a nationally
recognized overnight courier service, addressed to the Company, at [ADDRESS], Attention: [NAME], email address: [●] or such other
email address or address as the Company may specify for such purposes by notice to the Holders. Any and all notices or other communications
or deliveries to be provided by the Company hereunder shall be in writing and delivered personally, by facsimile, email or sent by a
nationally recognized overnight courier service addressed to each Holder at the facsimile number, email address or address of such Holder
appearing on the books of the Company. Any notice or other communication or deliveries hereunder shall be deemed given and effective
on the earliest of (i) the time of transmission, if such notice or communication is delivered via facsimile at the facsimile number or
e-mail at the e-mail address set forth in this Section prior to 5:30 p.m. (New York City time) on any date, (ii) the next Trading Day
after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number or e-mail at the e-mail
address set forth in this Section on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day,
(iii) the second Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service, or (iv)
upon actual receipt by the party to whom such notice is required to be given.
i)
Limitation of Liability. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant
to purchase Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of
the Holder for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability is asserted by the Company
or by creditors of the Company.
j)
Remedies. The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will
be entitled to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate
compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to
assert the defense in any action for specific performance that a remedy at law would be adequate.
k)
Successors and Assigns. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall
inure to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns
of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and shall
be enforceable by the Holder or holder of Warrant Shares.
l)
Amendment. This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company, on
the one hand, and the Holder on the other hand.
m)
Severability. Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall
be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining
provisions of this Warrant.
n)
No Expense Reimbursement. The Holder shall in no way be required the pay, or to reimburse the Company for, any fees or expenses
of the Company’s transfer agent in connection with the issuance or holding or sale of the Common Stock, Warrant and/or Warrant
Shares. The Company shall solely be responsible for any and all such fees and expenses.
o)
Headings. The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed
a part of this Warrant.
********************
(Signature
Page Follows)
IN
WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above
indicated.
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THARIMMUNE,
INC. |
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By: |
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Name: |
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Title: |
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NOTICE
OF EXERCISE
(1)
The undersigned hereby elects to purchase ________ Warrant Shares of the Company pursuant to the terms of the attached Warrant (only
if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.
(2)
Payment shall take the form of (check applicable box):
☐
in lawful money of the United States; or
☐
the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection 2(c), to exercise
this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure set forth in
subsection 2(c).
(3)
Please issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:
The
Warrant Shares shall be delivered to the following DWAC Account Number:
[SIGNATURE
OF HOLDER]
Name
of Investing Entity: |
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Signature
of Authorized Signatory of Investing Entity: |
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Name
of Authorized Signatory: |
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Title
of Authorized Signatory: |
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ASSIGNMENT
FORM
(To
assign the foregoing Warrant, execute this form and supply required information. Do not use this form to purchase shares.)
FOR
VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby assigned to
Name: |
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(Please
Print) |
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Address: |
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(Please
Print) |
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Phone
Number: |
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Email
Address: |
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Dated:
_____________________ __, ______ |
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Holder’s
Signature: |
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Holder’s
Address: |
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Exhibit
5.1
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Sheppard, Mullin, Richter & Hampton LLP
30 Rockefeller Plaza
New York, New York 10112-0015
212.653.8700 main
212.653.8701 fax
www.sheppardmullin.com |
November
17, 2023
VIA
ELECTRONIC MAIL
Tharimmune,
Inc.
1200
Route 22 East, Suite 2000
Bridgewater,
NJ 08807
Re: |
Registration
Statement on Form S-1 |
Ladies
and Gentlemen:
We
are acting as counsel to Tharimmune, Inc. (the “Company”) in connection with its registration statement on Form S-1 (the
“Registration, Statement”) filed with the Securities and Exchange Commission (the “Commission”) under the Securities
Act of 1933, as amended (the “Act”), relating to the proposed public offering of (a) $11,500,000 of shares (the “Shares”)
of common stock of the Company, par value $0.0001 per share (the “Common Stock”); (b) to each purchaser whose purchase of
shares of Common Stock in such offering would otherwise result in the purchaser, together with its affiliates and certain related parties,
beneficially owning more than 4.99% (or, at the election of the holder, 9.99%) of the Company’s outstanding Common Stock immediately
following the consummation of such offering, the opportunity to purchase, if the purchaser so chooses, pre-funded warrants (the “Pre-Funded
Warrants”), in lieu of shares of Common Stock and (c) warrants to be issued by the Company to the underwriters of the Company named
in the Registration Statement to purchase up to 3% of the number of shares of Common Stock sold in the offering (the “Representative’s
Warrants”) upon the closing of the public offering pursuant to which the Registration Statement relate. The Shares will be sold
by the Company pursuant to an underwriting agreement to be entered into by and between the Company and ThinkEquity LLC as the representative
of the several underwriters to be named therein. This opinion letter is furnished to you at your
request to enable you to fulfill the requirements of Item 601(b)(5) of Regulation S-K in connection with the Registration Statement.
In
connection with this opinion, we have reviewed and relied upon the following:
| ● | the
Registration Statement and the related prospectus included therein; |
| ● | The
Certificate of Incorporation of the Company, as amended and in effect
on the date hereof; |
| ● | The
Bylaws of the Company in effect on the date hereof; |
| ● | The
form of Agreement; |
| ● | The
form of the Representative’s Warrants; |
| ● | the
resolutions of the Board of Directors of the Company authorizing/ratifying the issuance and
sale of the Shares, the preparation and filing of the Registration Statement, and other actions
with regard thereto; and |
| ● | such
other documents, records, certificates, memoranda and other instruments as we deem necessary
as a basis for this opinion. |
In
our examination, we have assumed the genuineness of all signatures, including endorsements, the legal capacity and competency of all
natural persons, the authenticity of all documents submitted to us as originals, the conformity to original documents of all documents
submitted to us as facsimile, electronic, certified or photocopy, and the authenticity of the originals of such copies. As to any facts
relevant to the opinions stated herein that we did not independently establish or verify, we have relied upon statements and representations
of officers and other representatives of the Company and others and of public officials.
Based
upon, subject to and limited by the foregoing, we are of the opinion that:
| 1. | Following
(i) execution and delivery by the Company of the Agreement, (ii) effectiveness of the Registration
Statement, (iii) issuance of the Shares pursuant to the terms of the Agreement, and (iv)
receipt by the Company of the consideration for the Shares specified in the resolutions,
the Shares will be duly authorized for issuance and, when issued, delivered and paid for
in accordance with the terms of the Agreement, will be validly issued, fully paid and non-assessable. |
|
|
Sheppard, Mullin, Richter & Hampton LLP
30 Rockefeller Plaza
New York, New York 10112-0015
212.653.8700 main
212.653.8701 fax
www.sheppardmullin.com |
| 2. | The
Representative’s Warrants have been duly authorized by all requisite corporate action
on the part of the Company under the DGCL and, provided that the Representative’s Warrants
have been duly executed and delivered by the Company and duly delivered to the purchasers
thereof against payment therefor, the Representative’s Warrants, when issued and sold
as contemplated in the Registration Statement will be valid and legally binding obligations
of the Company, enforceable against the Company in accordance with their terms, except as
enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium
or other similar laws relating to or affecting creditors’ rights generally and by general
equitable principles (regardless of whether such enforceability is considered in a proceeding
at law or in equity). |
| 3. | The
shares of Common Stock issuable upon exercise of the Representative’s Warrants (the
“Warrant Shares” and together with the Representative’s Warrants, and the
Shares, the “Securities”) have been duly authorized by all requisite corporate
action on the part of the Company under the DGCL and, when the Warrant Shares are delivered
to and paid for in accordance with the terms of the Representative’s Warrants and when
evidence of the issuance thereof is duly recorded in the Company’s books and records,
the Warrant Shares will be validly issued, fully paid and non-assessable. |
We
also hereby consent to the reference to our firm under the caption “Legal Matters” in the prospectus which forms part of
the Registration Statement. In giving this consent, we do not admit that we are within the category of persons whose consent is required
under Section 7 of the Act, the rules and regulations of the Commission promulgated thereunder or Item 509 of Regulation S-K.
We
express no opinion as to matters governed by any laws other than the DGCL. No opinion is expressed herein with respect to the qualification
of the Securities under the securities or blue sky laws of any state or any foreign jurisdiction.
This
opinion letter is rendered as of the date first written above and we disclaim any obligation to advise you of facts, circumstances, events
or developments which hereafter may be brought to our attention and which may alter, affect or modify the opinion expressed herein. Our
opinion is expressly limited to the matters set forth above and we render no opinion, whether by implication or otherwise, as to any
other matters relating to the Company or the Securities, or any other agreements or transactions that may be related thereto or contemplated
thereby. We are expressing no opinion as to any obligations that parties other than the Company may have under or in respect of the Securities
or as to the effect that their performance of such obligations may have upon any of the matters referred to above. No opinion may be
implied or inferred beyond the opinion expressly stated above.
Very
truly yours, |
|
|
|
/s/
Sheppard, Mullin, Richter & Hampton LLP |
|
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SHEPPARD, MULLIN, RICHTER & HAMPTON LLP |
|
Exhibit
23.1
CONSENT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We
consent to the incorporation by reference in this Amendment No. 1 to the Registration Statement on Form S-1 and related Prospectus,
of our report dated May 19, 2023, with respect to the consolidated financial statements of Tharimmune, Inc. (formerly Hillstream Biopharma,
Inc.) (Company) as of December 31, 2022 and 2021 and for the years then ended (which report includes an explanatory paragraph relating
to the existence of substantial doubt about the Company’s ability to continue as a going concern), included in the Company’s
Annual Report on Form 10-K/A for the year ended December 31, 2022, and to the reference to us under the heading “Experts”
in the related Prospectus which is part of this Registration Statement.
/s/
Mayer Hoffman McCann P.C.
Los
Angeles, California
November
17, 2023
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