tbuff_8k.htm

AGENCY AGREEMENT

June 16, 2015

Tribute Pharmaceuticals Canada Inc.

151 Steeles Avenue East

Milton, Ontario

L9T 1Y1

Attention: Rob Harris, President and Chief Executive Officer

Dear Mr. Harris:

The undersigned,

KES 7 Capital Inc. (the “Lead Agent”), Bloom Burton & Co. Ltd., Mackie Research Capital Corporation, Laurentian Bank Securities Inc. and Dundee Securities Inc. (collectively with the Lead Agent, the “Agents” and each individually an “Agent”) understand that Tribute Pharmaceuticals Canada Inc. (the “Corporation”) proposes to issue and sell up to $15,000,000 of 6%, secured and subordinated debentures of the Corporation (the “Debentures”) at a price of $1,000,000 per Debenture (the “Offering Price”) for aggregate gross proceeds of up to $15,000,000. The offering of the Debentures by the Corporation is referred to in this Agreement as the “Offering”. The terms and conditions of the Debentures will be outlined in a secured subordinated debenture agreement and a general security agreement (the “Debenture Documentation”).

In consideration of the Agents’ services to be rendered in connection with the Offering, the Corporation shall pay to the Agents a cash fee (the “Agents’ Fee”) equal to 6.0% of the gross proceeds of the Offering.

Based on the foregoing, and subject to the terms and conditions contained in this Agreement, the Agents severally and not jointly agree to act as, and the Corporation appoints the Agents as, the exclusive agents of the Corporation to offer the Debentures for sale on the Closing Date (as defined herein) in the Selling Jurisdictions (as defined herein) on a private placement basis at the Offering Price. It is understood and agreed by the Corporation and the Agents that the Agents shall act as agents only and are under no obligation to purchase any of the Debentures.

In connection with the offering and sale of the Debentures, the Agents shall be entitled, with the written consent of the Corporation, not to be unreasonably withheld or delayed, to retain as sub-agents other securities dealers or financial institutions to solicit subscriptions for Debentures. Any fee payable to such sub-agents shall be for the account of the Agents and not the Corporation.

The Agents shall be entitled to the fee provided for above and in Section 5 (a) herein. That fee shall be payable at the Closing Time upon the closing of the sale of the Debentures, and may be deducted by the Agents from the gross proceeds of the Offering.

1.	Definitions

In this Agreement:

(a)	“Agent” and “Agents” have the respective meanings given to them above;

(b)	“Agents’ Counsel” means Dentons Canada LLP;

(c)	“Agents’ Fee” has the meaning given to it above;

(d)	“Agreement” means the agreement resulting from the acceptance by the Corporation of the offer made by the Agents by this letter;

(e)	“Applicable Securities Laws” means all applicable securities laws, rules, regulations, notices and published policies of the Selling Jurisdictions in Canada and the United States;

(f)	“Business Day” means any day other than a Saturday, Sunday or statutory or civic holiday in Toronto, Ontario;

(g)	“Closing” means the completion of the Offering;

(h)	“Closing Date” means June 16, 2015 or such other date as the Corporation and the Agents may agree upon in writing, or as may be changed pursuant to this Agreement;

(i)	“Closing Time” means 8:00 a.m. (Toronto time) on the Closing Date;

(j)	“Corporation” has the meaning given to it above;

(k)	“Corporation’s Auditors” means such firm of chartered accountants as the Corporation may have appointed or may from time to time appoint as auditors of the Corporation, including prior auditors of the Corporation, as applicable;

(l)	“Corporation’s Counsel” means Fogler Rubinoff LLP;

(m)	“Debenture Documentation” has the meaning given to it above.

(n)	“Debt Instrument” means any loan, bond, debenture, promissory note or other instrument evidencing indebtedness (demand or otherwise) for borrowed money or other liability;

(o)	“Due Diligence Session” means the due diligence question and answer session held with management of the Corporation on July 14, 2014, May 21, 2015 and June 15, 2015;

(p)

“Environmental Laws” means any federal, state, provincial, territorial or local law, statute, ordinance, rule, regulation, order, decree, judgment, injunction, permit, license, authorization or other binding requirement, or common law, relating to health, safety or the regulation, protection, cleanup or restoration of the environment or natural resources, including those relating to the distribution, processing, generation, treatment, control, storage, disposal, transportation, other handling or release or threatened release of Hazardous Materials or Conditions, and “Hazardous Materials or Conditions” means any material, substance (including, without limitation, pollutants, contaminants, hazardous or toxic substances or wastes) or condition that is regulated by or may give rise to liability under any Environmental Laws;

(q)	“Financial Statements” means the audited consolidated financial statements of the Corporation as at and for the years ended December 31, 2013 and 2014 and for the unaudited interim financial statements for the period ended March 31, 2015 together with the notes thereto;

(r)

“Governmental Authority (ies)” means governments, regulatory authorities, governmental departments, agencies, commissions, bureaus, officials, ministers, Crown corporations, courts, bodies, boards, tribunals or dispute settlement panels or other law, rule or regulation-making organizations or entities:

(i)	having or purporting to have jurisdiction over the Corporation on behalf of any nation, province, territory or state or any other geographic or political subdivision of any of them; or

(ii)	exercising, or entitled or purporting to exercise any administrative, executive, judicial, legislative, policy, regulatory or taxing authority or power over the Corporation;

(s)	“Indemnified Party” has the meaning given to it in Section 11(b);

(t)	“Lead Agent” has the meaning given to it above;

(u)

“Material Adverse Effect” or “Material Adverse Change” means any effect, change, event or occurrence that is, or is reasonably likely to be, materially adverse to the results of operations, condition (financial or otherwise), assets, properties, capital, liabilities (contingent or otherwise), cash flow, income or business operations of the Corporation and its subsidiaries taken as a whole;

(v)	“Material Agreement” means any note, indenture, mortgage or other form of indebtedness and any contract, commitment, agreement (written or oral), joint venture instrument, lease or other document to which the Corporation is a party and which is material to the Corporation on a consolidated basis;

(w)	“notice” has the meaning given to it in Section 21;

(x)	“Offering” has the meaning given to it above;

(y)	“Offering Price” has the meaning given to it above;

(z)	“Person” means any individual, sole proprietorship, partnership, firm, entity, unincorporated association, unincorporated syndicate, unincorporated organization, trust, body corporate, limited liability company and unlimited liability company;

(aa)	“Public Record” means the public disclosure of the Corporation filed on SEDAR;

(bb)	“SEC” means the United States Securities and Exchange Commission;

(cc)	“SEDAR” means the System for Electronic Document Analysis and Retrieval;

(dd)	“Securities Commissions” means the securities commissions or similar regulatory authorities in the Selling Jurisdictions;

(ee)	“Selling Jurisdictions” means all of the provinces of Canada, the United States and such other jurisdictions as the Agents and the Corporation may agree;

(ff)	“Subscriber” means, for the purposes of this Agreement, the person who executes a Subscription Agreement or, if such person executes a Subscription Agreement as a duly authorized agent of one or more principals, the principal or principals of such person;

(gg)	“Subscription Agreements” means the agreements entered into by each Subscriber and the Corporation in respect of the Subscriber’s subscription for Debentures in the form and on terms and conditions satisfactory to each of the Corporation and the Agents, each acting reasonably;

(hh)	“TSX-V” means the TSX Venture Exchange;

(ii)	“United States” means the United States of America, its territories and possessions, any state of the United States, and the District of Columbia; and

(jj)	“U.S. Securities Act” means the United States Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

In this Agreement, “affiliated”, “misrepresentation”, “material change”, “material fact” and “subsidiary” have the meanings ascribed thereto under the Applicable Securities Laws of the Selling Jurisdictions in Canada, and “distribution” means “distribution” or “distribution to the public”, as the case may be, as defined under the Applicable Securities Laws of the Selling Jurisdictions in Canada, and “distribute” has a corresponding meaning.

In this Agreement, unless there is something in the subject matter or context inconsistent therewith:

(a)

words used herein importing the singular number include the plural and vice versa, words importing the use of any gender include all genders, and words importing persons include individuals, partnerships, associations, trusts, unincorporated organizations and corporations, and the rest of the sentence is construed as if the necessary grammatical and terminological changes had been made;

(b)

references herein to any agreement or instrument, including this Agreement, are deemed to be references to the agreement or instrument as varied, amended, modified, supplemented or replaced from time to time, and any specific references herein to any legislation or enactment are deemed to be references to such legislation or enactment as the same may be amended or replaced from time to time; and

(c)	all dollar amounts in this Agreement are expressed in Canadian dollars except where expressly indicated otherwise.

The division of this Agreement into sections, subsections, paragraphs, subparagraphs and clauses and the insertion of headings are for convenience of reference only and do not affect the construction or interpretation of this Agreement. The terms “this Agreement”, “hereof’, “herein”, “hereunder” and similar expressions refer to this Agreement and the schedules hereto and not to any particular section, paragraph, subparagraph, clause or other portion hereof and include any agreement or instrument supplementary or ancillary hereto.

2.	Restrictions on Sale

Each of the Agents severally and not jointly covenants and agrees with the Corporation that it will:

(a)	not solicit subscriptions for Debentures, trade in Debentures or otherwise do any act in furtherance of a trade of Debentures outside of the Selling Jurisdictions;

(b)	in connection with the offer and sale of the Debentures in Canada, the Agents will only offer and sell the Debentures to persons resident in Canada who are:

(i)	“accredited investors” (as defined in National Instrument 45-106 – Prospectus Exemptions or, in Ontario, Section 73.3 of the Securities Act (Ontario)), and

(ii)	purchasing as principals; and

(c)

not advertise the proposed sale of the Debentures in printed media of general and regular paid circulation, radio, television or the internet nor provide or make available to prospective purchasers of Debentures any document or material which would constitute an offering memorandum as defined in Applicable Securities Laws in Canada.

Any agreement between an Agent and the members of any sub-agent group or selling group formed in connection with the Offering shall contain the restrictions in Schedule A hereto.

3.	Delivery of Subscription Agreements

The Agents agree to obtain from each Subscriber executed Subscription Agreements (including the execution of applicable Schedules to such Subscription Agreements) and deliver such Subscription Agreements (including applicable Schedules) to the Corporation at or prior to the Closing Time. In addition, the Agents agree to obtain from each Subscriber such forms and other documents as may be required by the Securities Commissions and by the Corporation’s registrar and provided by the Corporation to the Agents for delivery under this Agreement.

The Corporation and the Agents shall agree on the allocation of the Debentures amongst the Subscribers.

4.	Representations and Warranties of the Corporation

The Corporation represents, warrants and covenants to the Agents, and acknowledges that the Agents are relying upon such representations, warranties and covenants, that:

(a)

the Corporation (i) is duly amalgamated under the Business Corporations Act (Ontario) (the “Act”) and is up-to-date in respect of all material corporate filings and is in good standing under such Act; (ii) has all requisite corporate power, authority and capacity to carry on its business as now conducted and to own, lease and operate its properties and assets (including as described in the Public Disclosure); and (iii) has all requisite corporate power, authority and capacity to create, issue and sell the Debentures, to enter into this Agency Agreement and to carry out the provisions contained in hereunder and thereunder;

(b)	the Corporation does not have any material subsidiaries with the exception of Tribute Pharmaceuticals International Inc.;

(c)	no proceedings have been taken, instituted or, to the knowledge of the Corporation, are pending for the dissolution or liquidation of the Corporation;

(d)

the Corporation has conducted its business in compliance, in all material respects, with all applicable laws, rules and regulations (including all applicable federal, national, provincial, municipal, and local environmental anti-pollution and licensing laws, regulations and other lawful requirements of any governmental or regulatory body, of each jurisdiction in which its business is carried on and is licensed, registered or qualified in all jurisdictions in which it owns, leases or operates its property or carries on business to enable its business to be carried on as now conducted and its property and assets to be owned, leased and operated and all such licences, registrations and qualifications are valid, subsisting and in good standing and it has not received a notice of non-compliance, nor knows of, nor has reasonable grounds to know of, any facts that could give rise to a notice of non-compliance with any such laws, regulations or permits which could reasonably be expected to have a Material Adverse Effect and all such licences, registrations and qualifications are valid, subsisting and in good standing;

(e)	all necessary corporate action has been taken or will have been taken prior to the Closing Time by the Corporation so as to validly issue and sell the Debentures;

(f)	except for the approval of the TSXV and any post-closing notice filings required under Applicable Securities Laws, all consents, approvals, authorizations and corporate action have been taken and all necessary documents have been delivered and executed with respect to the Offering;

(g)

the execution and delivery of this Agency Agreement, the Debenture Documentation and the performance of the transactions contemplated hereby and thereby, including the issuance and sale of the Debentures, have been duly authorized by all necessary corporate action of the Corporation and this Agency Agreement and the Debenture Documentation has been executed and delivered by the Corporation and constitutes a valid and binding obligation of the Corporation, enforceable against the Corporation in accordance with its terms, provided that enforcement thereof may be limited by laws affecting creditors’ rights generally, that specific performance and other equitable remedies may only be granted in the discretion of a court of competent jurisdiction, that the provisions thereof relating to indemnity, contribution and waiver of contribution may be unenforceable under applicable law and that enforceability is subject to the provisions of the Limitations Act, 2002 (Ontario);

(h)

except for any post-closing notice filings required under Applicable Securities Laws, the execution and delivery of this Agency Agreement and the Debenture Documentation, and the fulfilment of the terms hereof and thereof by the Corporation, including the issuance and sale of the Debentures, do not and will not require the consent, approval, authorization, registration or qualification of or with any Governmental Authority, stock exchange, Securities Commission or other third party, except such as have been obtained or such as may be required (and shall be obtained prior to the Closing Time) under Applicable Securities Laws or stock exchange regulations;

(i)	the Debentures have been, or prior to the Closing Time will be, duly and validly authorized for issuance and, upon receipt by the Corporation of the purchase price for the Debentures, will be validly issued;

(j)	the authorized capital of the Corporation consists of an unlimited number of Common Shares and an unlimited number of preference shares, of which, as of June 15, 2015, 119,541,156 Common Shares and no preference shares were outstanding as fully paid and non-assessable Common Shares;

(k)

the Corporation is not aware of any legislation, or proposed legislation published by a legislative body, which it anticipates will materially and adversely affect the business, affairs, operations, assets, liabilities (contingent or otherwise) or prospects of the Corporation on a consolidated basis;

(l)

no order ceasing or suspending trading in any securities of the Corporation or prohibiting the sale of the Debentures or the trading of any of the Corporation’s issued securities has been issued and no proceedings for such purpose are threatened or, to the best of the Corporation’s knowledge, pending;

(m)

except as disclosed to the Agents, no person now has any agreement or option or right or privilege (whether at law, pre-emptive or contractual) capable of becoming an agreement for the purchase, subscription or issuance of, or conversion into, any unissued shares, securities, warrants or convertible obligations of any nature of the Corporation;

(n)	since December 31, 2014, except as disclosed in the Public Record:

(i)	there has not been any material change in the assets, liabilities, obligations (absolute, accrued, contingent or otherwise), business, condition (financial or otherwise) or results of operations of the Corporation on a consolidated basis;

(ii)	there has not been any material change in the capital stock or long-term debt of the Corporation on a consolidated basis; and

(iii)

the Corporation has carried on its business in the ordinary course;

(o)	the Financial Statements of the Corporation present fairly, in all material respects, the financial condition of the Corporation on a consolidated basis for the periods then ended;

(p)	the Corporation does not have any liabilities, direct or indirect, contingent or otherwise, not disclosed in the Public Record which could reasonably be expected to have a Material Adverse Effect;

(q)

except as disclosed in the Public Record (and certain other matters disclosed in writing to the Agents that the Corporation believes are without merit and/or would not have a Material Adverse Effect), there are no threats of actions, proceedings or investigations (whether or not purportedly by or on behalf of the Corporation) that have been made to the Corporation or, to the knowledge of the Corporation, that are pending or affecting the Corporation at law or in equity (whether in any court, arbitration or similar tribunal) or before or by any federal, provincial, state, municipal or other governmental department, commission, board or agency, domestic or foreign, which could reasonably be expected to have a Material Adverse Effect;

(r)

the execution and delivery of this Agency Agreement and the Debenture Documentation, and the fulfilment of the terms hereof and thereof by the Corporation, including the issuance and sale of the Debentures, do not and will not (as the case may be) conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, whether after notice or lapse of time or both, (A) any statute, rule or regulation applicable to the Corporation, including Applicable Securities Laws; (B) the constating documents, by-laws or resolutions of the Corporation; (C) the terms of any Debt Instrument, Material Agreement, mortgage, note, indenture, instrument, lease or any other material agreement to which the Corporation is a party or by which they are bound; or (D) any judgment, decree or order binding the Corporation or the respective property or assets of the Corporation;

(s)	except as disclosed in the Public Record, to the knowledge of the Corporation, no agreement is in force or effect which in any manner affects the voting or control of any of the securities of the Corporation;

(t)

the Corporation is not included in a list of defaulting reporting issuers maintained by the Securities Commissions in the Qualifying Jurisdictions and in particular, without limiting the foregoing, the Corporation has at all relevant times complied with its obligations to make timely disclosure of all material changes relating to it, no such disclosure has been made on a confidential basis that is still maintained on a confidential basis, and there is no material change relating to the Corporation which has occurred and with respect to which the requisite material change report has not been filed with the Securities Commissions and the Corporation is in all material respects in compliance with the rules and regulations of the TSXV;

(u)

the Corporation has complied in all material respects with requirements to file all reports, schedules, forms, statements and other documents that it is required to file under the U.S. Exchange Act, including pursuant to Section 13(a) or 15(d) of the U.S. Exchange Act, including the exhibits thereto and documents incorporated by reference therein, being collectively referred to herein as the “SEC Reports”) on a timely basis or has received a valid extension of such time of filing and has filed any such SEC Reports prior to the expiration of any such extension. As of their respective dates, the SEC Reports complied in all material respects with the respective requirements of the U.S. Exchange Act and the rules and regulations of the SEC promulgated thereunder. The financial statements of the Corporation included in the SEC Reports comply in all material respects with applicable accounting requirements and the rules and regulations of the Commission with respect thereto as in effect at the time of filing. Such financial statements have been prepared in accordance with U.S. generally accepted accounting principles applied on a consistent basis during the periods involved (“GAAP”), except as may be otherwise specified in such financial statements or the notes thereto and except that unaudited financial statements may not contain all footnotes required by GAAP, and fairly present in all material respects the financial position of the Corporation as of and for the dates thereof and the results of operations and cash flows for the periods then ended, subject, in the case of unaudited statements, to normal, immaterial, year-end audit adjustments;

(v)

neither the Corporation nor, to the knowledge of the Corporation, any director, officer, agent, employee, affiliate or other person acting on behalf of the Corporation is aware of or has taken any action, directly or indirectly, that has resulted or would result in a violation of the Foreign Corrupt Practices Act of 1977 (United States), as amended, and the rules and regulations thereunder (the “FCPA”), and the Corruption of Foreign Public Officials Act (Canada) (the “CFPOA”) including, without limitation, making use of the mails or any means or instrumentality of interstate commerce corruptly in furtherance of an offer, payment, promise to pay or authorization of the payment of any money, or other property, gift, promise to give, or authorization of the giving of anything of value to any “foreign official” (as such term is defined in the FCPA) or any “foreign public official” (as such term is defined in the CFPOA) or any foreign political party or official thereof or any candidate for foreign political office, in contravention of the FCPA and the CFPOA; and the Corporation will monitor its respective businesses to ensure compliance with the FCPA and the CFPOA, as applicable, and, if violations of the FCPA or the CFPOA are found, will take remedial action to remedy such violations;

(w)

the operations of the Corporation are, and have been conducted at all times, in compliance with all material applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970 (United States), as amended, the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada), the money laundering statutes of all applicable jurisdictions, the rules and regulations thereunder and any related or similar applicable rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the “Money Laundering Laws”) and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Corporation with respect to the Money Laundering Laws is pending or, to the knowledge of the Corporation, threatened;

(x)

neither the Corporation nor, to the knowledge of the Corporation, any director, officer, agent, employee, affiliate or person acting on behalf of the Corporation is currently subject to any United States sanctions administered by the Office of Foreign Assets Control of the United States Treasury Department (“OFAC”); and the Corporation will not directly or indirectly use the proceeds of this Offering, 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 United States sanctions administered by OFAC;

(y)	all filings and fees required to be made and paid by the Corporation pursuant to Applicable Securities Laws have been paid or will be promptly paid by the Corporation following the Closing Time;

(z)	the Corporation’s Auditors who audited the consolidated financial statements of the Corporation for the year ended December 31, 2014 and delivered their auditors’ report thereto are independent public accountants as required by the Canadian Securities Laws;

(aa)	there has not been any “reportable event” (within the meaning of National Instrument 51- 102 – Continuous Disclosure Obligations) with the Corporation’s Auditors;

(bb)

all taxes (including income tax, capital tax, payroll taxes, employer health tax, workers’ compensation payments, property taxes, custom and land transfer taxes), duties, royalties, levies, imposts, assessments, deductions, charges or withholdings and all liabilities with respect thereto including any penalty and interest payable with respect thereto (collectively, “Taxes”) due and payable by the Corporation have been paid, except for where the failure to pay such taxes would not constitute an adverse material fact of the Corporation or result in a Material Adverse Effect. All tax returns, declarations, remittances and filings required to be filed by the Corporation have been filed with all appropriate Governmental Authorities and all such returns, declarations, remittances and filings are complete and materially accurate and no material fact or facts have been omitted therefrom which would make any of them misleading except where the inaccuracy or failure to file such documents would not constitute an adverse material fact of the Corporation or result in a Material Adverse Effect. No examination of any tax return of the Corporation is currently in progress and there are no issues or disputes outstanding with any Governmental Authority respecting any taxes that have been paid, or may be payable, by the Corporation, in any case, except where such examinations, issues or disputes would not constitute an adverse material fact of the Corporation or result in a Material Adverse Effect;

(cc)

neither the Corporation or to the knowledge of the Corporation any other person, is in default in the observance or performance of any term, covenant or obligation to be performed by the Corporation or such other person under any Debt Instrument, Material Agreement, agreement, or arrangement to which the Corporation is a party or otherwise bound which could reasonably be expected to have a Material Adverse Effect, and all such contracts, agreements or arrangements are in good standing, and to the knowledge of the Corporation no event has occurred which with notice or lapse of time or both would constitute such a default by the Corporation or any other party;

(dd)	Equity Financial Trust Company at its principal transfer office in the City of Toronto, Ontario has been duly appointed as the registrar and transfer agent for the Common Shares;

(ee)

except as disclosed in the Public Record, none of the directors or officers of the Corporation, any known holder of more than 10% of any class of shares of the Corporation, or any known associate or affiliate of any of the foregoing persons, has had any material interest, direct or indirect, in any transaction during the three most recently completed financial years or during the current financial year, or any proposed material transaction which, as the case may be, materially affected, is material to or will materially affect the Corporation on a consolidated basis;

(ff)

each Debt Instrument to which the Corporation is a party is in good standing and the Corporation is not in default of any obligation or covenant under such Debt Instruments and, except for intercompany debt, the Corporation is not party to any material Debt Instrument or has any material loans or other indebtedness outstanding which has been made to any of its shareholders, officers, directors or employees, past or present, or any person not dealing at arm’s length with them;

(gg)

the Corporation is in compliance, in all material respects, with all applicable federal, provincial, state, municipal and local laws, statutes, ordinances, by laws and regulations and orders, directives and decisions rendered by any ministry, department or administrative or regulatory agency, domestic or foreign (the “Environmental Laws”) relating to the protection of the environment, occupational health and safety or the processing, use, treatment, storage, disposal, discharge, transport or handling of any pollutants, contaminants, chemicals or industrial, toxic or hazardous wastes or substance (“Hazardous Substances”);

(hh)

the Corporation has collectively, obtained all material licences, permits, approvals, consents, certificates, registrations and other authorizations under all applicable Environmental Laws (the “Environmental Permits”) necessary as at the date hereof for the operation of the business carried by the Corporation;

(ii)

the Corporation has not used, except in compliance in all material respects with all Environmental Laws and Environmental Permits, any property or facility which it owns or leases or previously owned or leased, to generate, manufacture, process, distribute, use, treat, store, dispose of, transport or handle any Hazardous Substance;

(jj)

the Corporation has not received any notice of, or been prosecuted for an offence alleging, non-compliance with any Environmental Law. There are no orders or directions relating to environmental matters requiring any material work, repairs, construction or capital expenditures to be made with respect to any of the assets of the Corporation which are material to the Corporation, nor has the Corporation received notice of any of the same;

(kk)

the Corporation has not received any notice wherein it is alleged or stated that it is potentially responsible for a federal, provincial, state, municipal or local clean-up site or corrective action under any Environmental Laws and the Corporation has not received any request for information in connection with any federal, state, provincial, municipal or local inquiries as to disposal sites;

(ll)

except as disclosed in the Public Record, the Corporation is the sole and exclusive owner of all right, title and interest in and to, or has a valid and enforceable right to use pursuant to a written license, all trademarks, trade names, service marks, patents, patent applications, other patent rights, copyrights, domain names, software, inventions, processes, databases, know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures) and other similar intellectual property rights, whether registered or unregistered and in any jurisdiction (collectively, “Intellectual Property Rights”) reasonably necessary to conduct its business as now conducted or proposed to be conducted. To the knowledge of the Corporation, the Corporation’s business as now conducted or proposed to be conducted as described in the Public Record, does not infringe, conflict with or otherwise violate any Intellectual Property Rights of others, and the Corporation has not received, and has no reason to believe that it will receive, any notice of infringement or conflict with asserted Intellectual Property Rights of others, or any facts or circumstances which would render any Intellectual Property Rights invalid or inadequate to protect the interest of the Corporation therein. Except as disclosed to the Agent, to the knowledge of the Corporation, there is no infringement by third parties of any Intellectual Property Rights owned by the Corporation. Except as disclosed in the Public Record, there is no pending or, to the knowledge of the Corporation, threatened action, suit, proceeding or claim relating to Intellectual Property Rights owned by the Corporation. Except as disclosed in the Public Record, the Corporation 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. All licenses for Intellectual Property Rights owned or used by the Corporation are valid, binding upon and enforceable by or against the Corporation and, to the Corporation’s knowledge, against the parties thereto in accordance with their terms. To the knowledge of the Corporation, none of the technology employed by the Corporation has been obtained or is being used by the Corporation in violation of any contractual obligation binding on the Corporation or, to the Corporation’s knowledge, any of its officers, directors or employees or otherwise in violation of the rights of any third party. All assignments from inventors to the Corporation have been obtained and filed with the appropriate patent offices for all of the Corporation’s patent applications. Except as disclosed in the Public Record the Corporation does not have knowledge of any claims of third parties to any ownership interest or lien with respect to the Corporation’s or its licensors’ patents and patent applications. The Corporation does not know of any facts which would form a basis for a finding of unenforceability or invalidity of any of the patents, trademarks or service marks of the Corporation. The Corporation does not know of any material defects of form in the preparation or filing of the patent applications of the Corporation. To the knowledge of the Corporation, the Corporation has complied with the U.S. Patents and Trademark Office duties and Canadian equivalent duties of candor and disclosure for each patent and patent application of the Corporation. The Corporation does not know of any fact with respect to the patent applications of the Corporation presently on file that (i) would preclude the issuance of patents with respect to such applications, (ii) would lead the Corporation to conclude that such patents, when issued, would not be valid and enforceable in accordance with applicable regulations or (iii) would result in a third party having any rights in any patents issuing from such patent applications. The Corporation has taken all commercially reasonable steps to protect, maintain and safeguard its rights in all material Intellectual Property Rights, including the execution of appropriate nondisclosure and confidentiality agreements;

(mm)

except as disclosed in the Public Record, the Corporation (or parties under contractual obligation to the Corporation) holds all licenses, certificates, approvals and permits from all provincial, federal, state, United States, foreign and other regulatory authorities, including but not limited to the United States Food and Drug Administration (the “FDA”), Health Canada (“HC”), the European Medicines Agency (the “EMA”) and any foreign regulatory authorities performing functions similar to those performed by the FDA, HC and the EMA, that are material to the conduct of the business of the Corporation as such business is now conducted or proposed to be conducted as described in the Public Record, all of which are valid and in full force and effect and there is no proceeding pending or, to the knowledge of the Corporation, threatened which may cause any such license, certificate, approval or permit to be withdrawn, cancelled, suspended or not renewed. Nothing has come to the attention of the Corporation that has caused the Corporation to believe that the completed studies, tests, preclinical studies and clinical trials conducted by or on behalf of the Corporation that are described in the Public Record were not conducted, in all material respects, in accordance with 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 Corporation; or that the drug substances used in the clinical trials have not been manufactured, under “current good manufacturing practices”, when required, in the United States, Canada and other jurisdictions in which such clinical trials have been and are being conducted. No filing or submission to the FDA, HC, the EMA or any other regulatory body, that was or is intended to be the basis for any approval of the Corporation’s products or product candidates, to the knowledge of the Corporation, contains any material omission or material false information. The Corporation is not in violation of any material law, order, rule, regulation, writ, injunction or decree of any court or governmental agency or body, applicable to the investigation of new drugs in humans and animals, including, but not limited to, those promulgated by the FDA, HC or the EMA;

(nn)

the descriptions in the Public Record of the results of the clinical trials referred to therein are consistent in all material respects with such results and no other studies or other clinical trials whose results are known to the Corporation are materially inconsistent with or otherwise materially call into question the results described or referred to in the Public Record. To the Corporation’s knowledge, the studies, tests and preclinical and clinical trials conducted by or on behalf of the Corporation were and, if still pending, are, in all material respects, being conducted in accordance with experimental protocols, procedures and controls pursuant to accepted professional scientific standards and all applicable laws and authorizations;

(oo)

the Corporation possesses such valid and current certificates, authorizations or permits issued by the appropriate federal, provincial, state, local or foreign regulatory agencies or bodies necessary to conduct its business, except where the failure to possess such certificates, authorizations or permits would not, individually or in the aggregate, result in a Material Adverse Change, and the Corporation has not received, nor has any reason to believe that it will receive, any notice of proceedings relating to the revocation or modification of, or non—compliance with, any such certificate, authorization or permit which, singly or in the aggregate, if the subject of an unfavourable decision, ruling or finding, could result in a Material Adverse Change;

(pp)

neither the Corporation or, to the best of its knowledge, any employee or agent thereof, has made any unlawful contribution or other payment to any official of, or candidate for, any federal, state, provincial or foreign office, or failed to disclose fully any contribution, in violation of any law, or made any payment to any foreign, Canadian, governmental officer or official, or other Person charged with similar public or quasi-public duties, other than payments required or permitted by applicable laws;

(qq)	there are no environmental audits, evaluations, assessments, studies or tests relating to the Corporation except for ongoing assessments conducted by or on behalf of the Corporation in the ordinary course;

(rr)

each material plan for retirement, bonus, stock purchase, profit sharing, stock option, deferred compensation, severance or termination pay, insurance, medical, hospital, dental, vision care, drug, sick leave, disability, salary continuation, legal benefits, unemployment benefits, vacation, incentive or otherwise contributed to or required to be contributed to, by the Corporation for the benefit of any current or former director, officer, employee or consultant of the Corporation (the “Employee Plans”) has been maintained in compliance with its terms and with the requirements prescribed by any and all statutes, orders, rules and regulations that are applicable to such Employee Plans, in each case in all material respects and has been publicly disclosed to the extent required by Applicable Securities Laws;

(ss)	all material accruals for unpaid vacation pay, premiums for employment insurance, health premiums, federal or state pension plan premiums, accrued wages, salaries and commissions and employee benefit plan payments have been reflected in the books and records of the Corporation;

(tt)	there has never been, there is not currently and the Corporation does not anticipate any labour disruption with respect to the employees or consultants of the Corporation which is adversely affecting or could adversely affect the carrying on of the business of the Corporation;

(uu)	the minute books of the Corporation made available to the Agents contain copies of all constating documents and all proceedings of security holders and directors (and committees thereof) and are complete in all material respects;

(vv)

the Corporation is not aware of any circumstances presently existing under which liability is or could reasonably be expected to be incurred under Part XXIII.1 – Civil Liability for Secondary Market Disclosure of the Securities Act (Ontario) or analogous securities laws in the other Qualifying Jurisdictions;

(ww)	other than the Agents, there is no person acting or purporting to act at the request or on behalf of the Corporation that is entitled to any brokerage or finder’s fee in connection with the transactions contemplated by this Agency Agreement; and

(xx)	the Corporation will use the proceeds from the Offering for acquisitions and working capital.

5.	Agents’ Fee

In consideration for the Agents’ services hereunder, the Corporation will pay to the Agents the Agents’ Fee. The Agents’ Fee shall be apportioned among the Agents as follows:

Kes 7 Capital Inc.	30	%
Bloom Burton & Co. Ltd.	25	%
Mackie Research Capital Corporation	25	%
Laurentian Bank Securities Inc.	10	%
Dundee Securities Ltd.	10	%
	100	%

Closing

The sale of the Debentures shall be completed at the Closing Time at the offices of Corporation’s Counsel in Toronto, Ontario or at such other place as the Corporation and the Agents may agree. At the Closing Time, the Corporation shall deliver to the Agents:

(a)	the opinions, certificates and agreements referred to in Section 9 and all other documents required to be provided by the Corporation to the Agents pursuant to this Agreement, the Debenture Documentation and the Subscription Agreements;

(b)	definitive certificates evidencing the Debentures duly registered as the Lead Agent may direct the Corporation;

(c)	the Corporation’s receipt for payment by the Agents of an amount equal to the aggregate purchase price for the Debentures sold pursuant to the Offering; and

(d)	such further documentation as may be contemplated by this Agreement, the Debenture Documentation, or as Agents’ Counsel or the applicable regulatory authorities may reasonably require;

against delivery by the Agents of:

(e)	all duly completed Subscription Agreements tendered by the Subscribers for the Debentures being issued and sold and, where applicable, all completed forms, schedules and certificates contemplated by such Subscription Agreements;

(f)	a wire transfer of immediately available funds in an amount equal to the aggregate purchase price for the Debentures sold pursuant to the Offering, less an amount equal to the Agents’ Fee and the costs and expenses of the Agent provided for in Section 14; and

(g)	the Agents’ receipt for the Agents’ Fee and the definitive certificates delivered to the Agents in accordance with Section 6(b).

7.	Delivery of Debentures

The Corporation shall, prior to the Closing Date, make all necessary arrangements for the preparation and delivery (and, in the case of definitive certificates, execution of such definitive certificate(s) representing the Debentures) of the Debentures and Debenture Documentation on the Closing Date in the City of Toronto.

8.	Agency Basis

The Corporation agrees that the Agents are acting as agents of the Corporation in seeking purchasers of Debentures without underwriter liability, and nothing in this Agreement or any other agreement shall require the Agents to purchase any of the Debentures in connection with the Offering.

9.	Conditions to Closing

The sale of the Debentures shall be subject to the representations, warranties and covenants of the Corporation contained in this Agreement and the Debenture Documentation being accurate as of the date of this Agreement and as of the Closing Date, to the Corporation having performed all of its obligations under this Agreement and the Debenture Documentation and to the following additional conditions, and the Agents shall have the right on the Closing Date on behalf of Subscribers for Debentures to withdraw, all Subscription Agreements delivered and not previously withdrawn by Subscribers unless such conditions have been satisfied:

(a)	Delivery of Opinions

(i)

The Agents shall have received at the Closing Time a legal opinion dated the Closing Date, in form and substance satisfactory to the Agents, acting reasonably, addressed to the Agents (and, if required for opinion purposes, counsel to the Agents) from Corporation’s Counsel as to the laws of Canada and the Selling Jurisdictions in Canada, which counsel in turn may rely upon the opinions of local counsel where it deems such reliance proper as to the laws other than those of Canada and such provinces in Canada where Corporation’s Counsel is licensed to practice law (or alternatively make arrangements to have such opinions directly addressed to the Agents) and as to matters of fact, on certificates of Governmental Authorities and officers of the Corporation and letters from stock exchange representatives and transfer agents, with respect to customary corporate, securities law and other matters requested by the Agents.

(ii)

The Agents having received at the Closing Time such further opinions, certificates and other documentation from the Corporation as may be contemplated herein or as the Agents may reasonably require, provided, however, that the Agents shall request any such opinion, certificate or document within a reasonable period prior to the Closing Time that is sufficient for the Corporation to obtain and deliver such certificate or document.

(b)	Delivery of Certificates

(i)

The Agents shall have received at the Closing Time a certificate dated the Closing Date, addressed to the Agents (and, if necessary for opinion purposes, counsel to the Agents) and signed by officers of the Corporation acceptable to the Agents, acting reasonably, with respect to the constating documents of the Corporation, no proceedings to voluntarily wind-up or dissolve, all resolutions of the board of directors of the Corporation relating to this Agreement, the Debenture Documentation and the transactions contemplated by this Agreement and the Debenture Documentation and the incumbency and specimen signatures of signing officers of the Corporation and such other matters as the Agents may reasonably request.

(ii)	The Agents shall have received at the Closing Time a certificate of good standing of the Corporation.

(iii)

The Agents shall have received at the Closing Time a certificate dated the Closing Date, addressed to the Agents and counsel to the Agents and signed on behalf of the Corporation by the Chief Executive Officer and the Chief Financial Officer or other officers of the Corporation acceptable to the Agents, certifying for and on behalf of the Corporation and without personal liability, after having made due enquiry:

(A)	the Corporation has complied with and satisfied all terms and conditions of this Agreement, the Debenture Documentation and the Subscription Agreements on its part to be complied with or satisfied at or prior to the Closing Time;

(B)

the representations and warranties of the Corporation contained in this Agreement, the Debenture Documentation and the Subscription Agreements are true and correct at the Closing Time with the same force and effect as if made at and as of the Closing Time after giving effect to the transactions contemplated by this Agreement and the Debenture Documentation;

(C)	the responses provided by the Corporation at the Due Diligence Session are true and correct and would not be different in any material respect if the Due Diligence Session were held immediately prior to the Closing Time;

(D)

the Corporation has made and/or obtained, on or prior to the Closing Time, all necessary filings, approvals, consents and acceptances of applicable regulatory authorities and under any applicable agreement or document to which the Corporation is a party or by which it is bound, required for the execution and delivery of this Agreement and the Debenture Documentation, the offering and sale of the Debentures in the Selling Jurisdictions in Canada and the consummation of the other transactions contemplated hereby (subject to completion of filings with certain regulatory authorities following the Closing Date);

(E)

no order, ruling or determination having the effect of suspending the sale of or cease trading the Debentures or any other securities of the Corporation has been issued by any regulatory authority and is continuing in effect and no proceedings for that purpose have been instituted or are pending or, to the knowledge of such officer of the Corporation, contemplated or threatened under any Applicable Securities Laws or by any other regulatory authority; and

(F)	such other matters as may be reasonably requested by the Agents or the Agents’ Counsel.

(c)	Exchange Approval

The Corporation shall have obtained the conditional approval of the TSX-V and any other applicable exchange in respect of the issuance and sale of the Debentures and all other necessary regulatory approvals prior to the Closing, including but not limited to the purchase of Medical Futures Inc.

(d)

Consents

All required third party consents and waivers necessary for the Corporation to enter into this Agreement and the Debenture Documentation and to consummate the transactions contemplated by this Agreement shall have been received at or prior to the Closing Time.

The foregoing conditions contained in this Section 9 are for the sole benefit of the Agents and may be waived in whole or in part by the Agents at any time and without limitation. If any of the foregoing conditions have not been met at the Closing Time, the Agents may terminate their obligations under this Agreement without prejudice to any other remedies they may have and the Agents shall have the right on behalf of the Subscribers to withdraw all Subscription Agreements delivered and not previously withdrawn by Subscribers.

10.	Rights of Termination

(a)	Regulatory Proceedings Out

If, after the date hereof and prior to the Closing Time, any enquiry, action, suit, investigation or other proceeding, whether formal or informal, is instituted or announced or any order is made by any federal, provincial or other Governmental Authority in relation to the Corporation which, in the opinion of any of the Agents, operates to prevent or restrict the distribution or trading of the Debentures, then such Agent shall be entitled, at its option and in accordance with Section 10(e), to terminate its obligations under this Agreement and the Debenture Documentation by notice to that effect given to the Corporation any time at or prior to the Closing Time.

(b)	Disaster Out

If prior to the Closing Time there should develop, occur or come into effect or existence any event, action, state, condition or major financial occurrence of national or international consequence or any law or regulation which, in the opinion of any of the Agents, seriously adversely affects, or involves, or will seriously adversely affect, or involve, the financial markets or the business, operations or affairs of the Corporation and its subsidiaries taken as a whole, then such Agent shall be entitled, at its option and in accordance with Section 10(e), to terminate its obligations under this Agreement and the Debenture Documentation by written notice to that effect given to the Corporation at any time at or prior to the Closing Time.

(c)	Material Change or Change in Material Fact Out

If, after the date hereof and prior to the Closing Time, there shall occur any material change or change in a material fact which, in the reasonable opinion of any of the Agents, would be expected to have a significant adverse effect on the business, affairs, prospects or financial condition of the Corporation and its subsidiaries taken as a whole or the market price or value of the securities of the Corporation, then such Agent shall be entitled, at its option, in accordance with Section 10(e), to terminate its obligations under this Agreement and the Debenture Documentation by written notice to that effect given to the Corporation any time at or prior to the Closing Time.

(d)	Non-Compliance with Conditions

The Corporation agrees that all terms and conditions in Section 9 shall be construed as conditions and complied with so far as they relate to acts to be performed or caused to be performed by it, that it will use its best efforts to cause such conditions to be complied with, and that any breach or failure by the Corporation to comply with any such conditions shall entitle any of the Agents, in accordance with Section 10(e), to terminate its obligations under this Agreement and the Debenture Documentation by written notice to that effect given to the Corporation at any time at or prior to the Closing Time, unless otherwise expressly provided in this Agreement or the Debenture Documentation. Each Agent may waive, in whole or in part, or extend the time for compliance with, any terms and conditions without prejudice to its rights in respect of any other terms and conditions or any other or subsequent breach or non-compliance, provided that any such waiver or extension shall be binding upon an Agent only if such waiver or extension is in writing and signed by the Agent.

(e)	Exercise of Termination Rights

The rights of termination contained in Sections 10(a), (b), (c) and (d) may be exercised by any of the Agents and are in addition to any other rights or remedies any of the Agents may have in respect of any default, act or failure to act or non-compliance by the Corporation in respect of any of the matters contemplated by this Agreement, the Debenture Documentation or otherwise. In the event of any such termination, there shall be no further liability on the part of the Agents to the Corporation or on the part of the Corporation to the Agents except in respect of any liability which may have arisen prior to or arise after such termination under Sections 11, 12 and 14. A notice of termination given by an Agent under Section 10(a), (b), (c) or (d) shall not be binding upon any other Agent who has not also executed such notice.

11.

Indemnity

(a)	Rights of Indemnity

(1) The Corporation covenants and agrees to protect, indemnify, and save harmless, each of the Agents and their respective affiliates, and each and every one of the directors, officers, employees, partners and agents of the Agents (individually, an “Indemnified Party” and collectively, the “Indemnified Parties”) harmless from and against any and all expenses, losses (excluding loss of profits), claims, actions, damages (other than consequential or punitive damages) or liabilities, joint or several (including the aggregate amount paid in settlement of any actions, suits, proceedings or claims and the reasonable fees and expenses of their counsel that may be incurred in advising with respect to and/or defending any claim that may be made against the Indemnified Parties) to which any Indemnified Party may become subject or otherwise involved in any capacity under any statute or common law or otherwise insofar as such expenses, losses, claims, damages, liabilities or actions arise out of or are based, directly or indirectly, upon the performance of professional services rendered to the Corporation by the Indemnified Parties (or any of them), whether directly or indirectly, including by reason of:

(a)

any information or statement contained in this Agreement, the Debenture Documentation, the Corporation’s publicly available disclosed documents filed on SEDAR or elsewhere, or in any other material prepared by the Corporation used for marketing the Offering or any certificate of the Corporation delivered hereunder or pursuant hereto, which at the time and in the light of the circumstances under which it was made contains or is alleged to contain a misrepresentation or any misstatement of a material fact;

(b)

the omission or alleged omission to state in in this Agreement, the Debenture Documentation, the Corporation’s publicly available disclosed documents filed on SEDAR or elsewhere, or in any other material prepared by the Corporation used for marketing the Offering or any certificate of the Corporation delivered hereunder or pursuant hereto, any material fact required to be stated therein or necessary to make any statement therein not misleading in light of the circumstances in which it was made;

(c)

any order made, or inquiry, investigation or proceeding commenced by any securities regulatory authority or other competent authority based upon any misrepresentation, untrue statement or omission or alleged untrue statement or omission in this Agreement, the Debenture Documentation, the Corporation’s publicly available disclosed documents filed on SEDAR or elsewhere, or in any other material prepared by the Corporation used for marketing the Offering or any certificate of the Corporation delivered hereunder or pursuant hereto that prevents or restricts the trading in any of the Corporation’s securities or the distribution or distribution to the public, as the case may be, of any of the Debentures in any of the Qualifying Jurisdictions;

(d)

the Corporation not complying with any requirement of Applicable Securities Laws or stock exchange requirements in connection with the transactions contemplated herein, including the Corporation’s non-compliance with any statutory requirement to make any document available for inspection; or

(e)

any breach of a representation or warranty of the Corporation contained in this Agreement or the Debenture Documentation or the failure of the Corporation to comply with any of its obligations hereunder.

(2) Notwithstanding Subsection 11(a) (1), the indemnification in Subsection 11(a)(1) does not and shall not apply to the extent that a court of competent jurisdiction in a final judgment that has become non- appealable shall determine that (a) the Agents and their respective affiliates have been negligent or have committed any fraudulent or illegal act in the course of the professional services rendered to the Corporation, and (b) such expenses, losses, claims, damages, liabilities or actions were caused or incurred by the gross negligence, fraud or wilful misconduct of the Agents.

(3) If any matter or thing contemplated by this Section 11 shall be asserted against any Indemnified Party in respect of which indemnification is or might reasonably be considered to be provided, such Indemnified Party will notify the Corporation in writing as soon as possible of the nature of such claim (provided that omission to so notify the Corporation will not relieve the Corporation of any liability that it may otherwise have to the Indemnified Party hereunder, except to the extent the Corporation is materially prejudiced by such omission) and the Corporation shall be entitled (but not required) to assume the defence of any suit brought to enforce such claim; provided, however, that the defence shall be through legal counsel reasonably acceptable to such Indemnified Party and that no settlement may be made by the Corporation or such Indemnified Party without the prior written consent of the other, such consent not to be unreasonably withheld.

(4) In any such claim, such Indemnified Party shall have the right to retain other legal counsel to act on such Indemnified Party’s behalf, provided that the fees and disbursements of such other legal counsel shall be paid by such Indemnified Party, unless: (a) the employment of such counsel has been authorized by the Corporation; or (b) the Corporation has not assumed the defence and employed counsel thereof promptly after receiving notice of such claim; or (c) the named parties to any such claim include both the Indemnified Party and the Corporation, and the Indemnified Party has been advised by legal counsel thereto that representation of both the Corporation and the Indemnified Party by the same legal counsel would be inappropriate due to actual or potential differing interests between them; or (d) there are one or more defences available to the Indemnified Party which are different from and in addition to those available to the Corporation, provided that the Corporation shall not be responsible for the fees or expenses of more than one legal firm in any single jurisdiction for all of the Indemnified Parties.

(5) To the extent that any Indemnified Party is not a party to this Agency Agreement, the Agents shall obtain and hold the right and benefit of this Section 11 in trust for and on behalf of such Indemnified Party.

(6) The Corporation hereby consents to personal jurisdiction in any court in which any claim that is subject to indemnification hereunder is brought against the Agents or any Indemnified Party and to the assignment of the benefit of this Section 11 to any Indemnified Party for the purpose of enforcement provided that nothing herein shall limit the Corporation’s right or ability to contest the appropriate jurisdiction or forum for the determination of any such claims.

(7) The rights of the Corporation contained in this Section 11 shall not enure to the benefit of any Indemnified Party if the Agents were provided with a copy of any amendment or supplement to this Agreement or Debenture Documentation which corrects any untrue statement or omission or alleged omission that is the basis of a claim by a party against such Indemnified Party and that is required, under the Applicable Securities Laws, to be delivered to such party by the Agents.

(8) The Corporation shall not be liable under this Section 11 for any settlement of any claim or action effected without its prior written consent.

(b)	Notification of Claims

If any matter or thing contemplated by Section 11(a) (any such matter or thing being referred to as a “Claim”) is asserted against any person or company in respect of which indemnification is or might reasonably be considered to be provided, such person or company (the “Indemnified Party”) will notify the Corporation as soon as possible of the nature of such Claim (but the omission so to notify the Corporation of any potential Claim shall not relieve the Corporation from any liability which they may have to any Indemnified Party and any omission so to notify the Corporation of any actual Claim shall affect the Corporation’s liability only to the extent that the Corporation is materially prejudiced by that failure). The Corporation shall assume the defence of any suit brought to enforce such Claim, provided, however, that

(i)	the defence shall be conducted through legal counsel acceptable to the Indemnified Party, acting reasonably, and

(ii)

no settlement of any such Claim or admission of liability may be made by the Corporation without the prior written consent of the Indemnified Party, acting reasonably, unless such settlement includes an unconditional release of the Indemnified Party from all liability arising out of such action or claim and does not include a statement as to or an admission of fault, culpability or failure to act, by or on behalf of any Indemnified Party.

(c)	Right of Indemnity in Favour of Others

With respect to any Indemnified Party who is not a party to this Agreement, the Agents shall obtain and hold the rights and benefits of this Section 11 in trust for and on behalf of such Indemnified Party.

(d)	Retaining Counsel

In any such Claim, the Indemnified Party shall have the right to retain one separate counsel to act on his or its behalf, provided that the fees and disbursements of such counsel shall be paid by the Indemnified Party unless: (i) the Corporation and the Indemnified Party shall have mutually agreed in writing to the retention of the other counsel; (ii) the named parties to any such Claim (including any added third or impleaded party) include both the Indemnified Party and the Corporation and the Indemnified Party shall have been advised in writing by counsel to the Indemnified Party that the representation of both parties by the same counsel would be inappropriate due to an actual or potential conflict of interest between the Corporation and the Indemnified Party; or (iii) the Corporation shall not have retained counsel within seven Business Days following receipt by the Corporation of notice of any such Claim from the Indemnified Party; provided that the Corporation shall not be responsible for the fees or expenses of more than one legal firm in any single jurisdiction for all of the Indemnified Parties.

12.	Contribution

(a)	Rights of Contribution

In order to provide for a just and equitable contribution in circumstances in which the indemnity provided in Section 11 would otherwise be available in accordance with its terms but is, for any reason, held to be unavailable to or unenforceable by the Agents or enforceable otherwise than in accordance with its terms, the Corporation and the Agents shall contribute to the aggregate of all claims, expenses, costs and liabilities and all losses (other than loss of profits) of a nature contemplated by Section 11 in such proportions so that the Agents shall be responsible for the portion represented by the percentage that the aggregate Agents’ Fee hereunder bears to the aggregate offering price of the Debentures being sold by the Corporation and the Corporation shall be responsible for the balance, whether or not they have been sued together or sued separately, provided, however, that (i) the Agents shall not in any event be liable to contribute, in the aggregate, any amounts in excess of the aggregate Agents’ Fee actually received by the Agents from the Corporation under this Agreement; (ii) each Agent shall not in any event be liable to contribute, individually, any amount in excess of such Agents’ portion of the aggregate Agents’ Fee actually received from the Corporation under this Agreement; and (iii) no party who has engaged in any fraud, fraudulent misrepresentation, wilful misconduct or negligence shall be entitled to claim contribution from any person who has not engaged in such fraud, fraudulent misrepresentation, wilful misconduct or negligence.

(b)	Rights of Contribution in Addition to Other Rights

The rights to contribution provided in this Section 12 shall be in addition to and not in derogation of any other right to contribution which the Agents may have by statute or otherwise at law.

(c)	Right of Contribution in Favour of Others

With respect to this Section 12, the Corporation acknowledges and agrees that the Agents are contracting on their own behalf and as agents for their affiliates, directors, officers, employees and agents.

For purposes of this Section 12, each person, if any, who controls an Agent within the meaning of Section 15 of the U.S. Securities Act or Section 20 of the U.S. Exchange Act and each Agents’ affiliates and selling agents shall have the same rights to contribution as such Agent and each person, if any, who controls the Corporation within the meaning of Section 15 of the U.S. Securities Act or Section 20 of the U.S. Exchange Act shall have the same rights to contribution as the Corporation. The Agents’ respective obligations to contribute pursuant to this Section 12 are several in proportion to the percentages of Agents’ Fee set forth opposite their respective names in Section 5(a) hereof and not joint.

(d)	Remedy Not Exclusive

The remedies provided for in this Section 12 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any party at law or in equity.

13.	Severability

If any provision of this Agreement is determined to be void or unenforceable in whole or in part, it shall be deemed not to affect or impair the validity of any other provision of this Agreement and such void or unenforceable provision shall be severable from this Agreement.

14.

Expenses

(a)

Whether or not the transactions contemplated by this Agreement shall be completed, all expenses of or incidental to the issue, sale and delivery of the Debentures and all expenses of or incidental to all other matters in connection with the offering of the Debentures shall be borne by the Corporation including, without limitation, all fees and disbursements of all legal counsel to the Corporation (including U.S., foreign and local counsel), all fees and disbursements of the Corporation’s accountants and auditors, all expenses related to road shows and marketing activities, all printing costs incurred in connection with the offering of the Debentures, including certificates, if any, representing the Debentures, all filing fees, all fees and expenses relating to listing the Debentures on any exchanges, all transfer agent fees and expenses, and all reasonable out-of-pocket expenses of the Agents incurred in connection with the offering of the Debentures, including without limitation the fees of Canadian counsel to the Agents which shall not exceed $75,000 (not including applicable taxes and disbursements), and any advertising, printing, courier, telecommunications, data search, presentation, travel and other expenses incurred by the Agents together with all related taxes (including, without limitation, provincial sales taxes and HST).

(b)	All expenses payable by the Corporation to the Agent in accordance with this Agreement shall be payable whether or not the Offering is completed.

15.	Survival of Representations and Warranties

The representations, warranties, obligations and agreements of the Corporation contained in this Agreement and in any certificate delivered pursuant to this Agreement or in connection with the purchase and sale of the Debentures, including but not limited to the Debenture Documentation, shall survive the payment by the Agents for the Debentures, if any, and the distribution of the Debentures, and shall continue in full force and effect unaffected by the termination of the Agents’ obligations and shall not be limited or prejudiced by any investigation made by or on behalf of the Agents in connection with the distribution of the Debentures.

16.	Entire Agreement

This Agreement, including any schedules hereto, represents the entire agreement of the parties hereto relating to the subject matter hereof and there are no representations, warranties, covenants or other agreements relating to the subject matter hereof except as stated or referred to herein. This Agreement shall not be amended or varied in its terms by oral agreement or by representations or otherwise except by instrument in writing executed by the duly authorized representatives of the parties hereto or their respective successors or assigns. It is understood that the terms and conditions of this Agreement supersede any previous verbal or written agreement between the Agents and the Corporation relating to the subject matter hereof.

17.

Amendment

No modification or amendment to this Agreement may be made unless agreed upon by the Corporation and the Agents in writing.

18.	Assignment and Enurement

No party may transfer or assign its rights or obligations under this Agreement without the prior written consent of the other parties and any transfer or assignment or purported transfer or assignment in contravention of this Section 18 shall be void and without force or effect. This Agreement shall be binding upon and shall enure to the benefit of the parties hereto and their respective successors and permitted assigns.

19.

Time

Time is of the essence in the performance of the parties’ respective obligations under this Agreement.

20.	Governing Law

This Agreement shall be governed by and construed in accordance with the laws of the Province of Ontario and the federal laws of Canada applicable in the Province of Ontario.

21.

Notice

Unless otherwise expressly provided in this Agreement, any notice or other communication to be given under this Agreement (a “notice”) shall be in writing addressed as follows:

If to the Corporation, addressed and sent to:

Tribute Pharmaceuticals Canada Inc.

151 Steeles Avenue East

Milton, Ontario

L9T 1Y1

Attention:

Facsimile No.:

e-mail:

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

Fogler, Rubinoff LLP

77 King Street West

Suite 3000, P.O. Box 95

TD Centre North Tower

Toronto, Ontario M5K 1G8

Attention:

Facsimile No.:

e-mail:

to the Lead Agent on behalf of the Agents:

Kes 7 Capital Inc.

2 Bloor Street East, Suite 2102

Toronto, Ontario

M4W 1A8

Attention:

e-mail:

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

Dentons Canada LLP

77 King Street West, Suite 400, TD Centre

Toronto, Ontario M5K 0A1

Attention:

Facsimile No.:

email:

or to such other address as any of the parties may designate by giving notice to the others in accordance with this Section 21. Each notice shall be personally delivered to the addressee or sent by fax or e-mail to the addressee. A notice which is personally delivered or delivered by fax or e-mail shall, if delivered prior to 5:00 p.m. (Toronto time) on a Business Day, be deemed to be given and received on that day and, in any other case, be deemed to be given and received on the first Business Day following the day on which it is delivered.

22.	Authority of the Lead Agent

The Lead Agent is hereby authorized by each of the other Agents to act on its behalf, except in respect of any consent to a settlement pursuant to Section 11(b) which consent shall be given by the Indemnified Party, a notice of termination pursuant to Section 10 which notice may be given by any of the Agents, or any waiver pursuant to Section 10(d), which waiver must be signed by all of the Agents.

23.	Agents as Trustee

The Corporation acknowledges and agrees that it is the intention of the parties to this Agreement and the Corporation hereby constitutes the Agents as trustees for each of the Subscribers in respect of each of the representations and warranties of the Corporation contained in this Agreement and the Agents shall be entitled, as trustees, in addition to any rights of the Subscribers, to enforce such representations and warranties on behalf of the Subscribers.

24.	Counterparts

This Agreement may be executed by the parties to this Agreement in counterpart and may be executed and delivered by facsimile and all such counterparts and facsimiles shall together constitute one and the same agreement.

[The remainder of this page has been left blank intentionally.]

If the foregoing is in accordance with your understanding and is agreed to by you, please signify your acceptance by executing the enclosed copies of this letter where indicated below and returning the same to the Lead Agent upon which this letter as so accepted shall constitute an Agreement among us.

	Yours very truly,

	KES 7 CAPITAL INC.

	By:	/s/ "Mark Christensen"
		Mark Christensen
		President & CEO

	BLOOM BURTON & CO. LTD.

	By:	/s/ "Jolyon Burton"
		Jolyon Burton
		CEO

	MACKIE RESEARCH CAPITAL CORPORATION

	By:	/s/ "Paul Rajchgod"
		Paul Rajchgod
		Managing Director, Investment Banking

	LAURENTIAN BANK SECURITIES INC.

	By:	/s/ "Nicolas Rimbert"
		Nicolas Rimbert
		Director, Investment Banking

	DUNDEE SECURITIES LTD.

	By:	/s/ "Aaron Unger"
		Aaron Unger
		Managing Director

The foregoing offer is accepted and agreed to as of the date first above written.

	TRIBUTE PHARMACEUTICALS INC.

	By:	/s/ "Scott Langille"
		Scott Langille
		Chief Financial Officer

UNLESS PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THIS SECURITY MUST NOT TRADE THE SECURITY BEFORE OCTOBER 17, 2015.

SERIES A SECURED DEBENTURE

TRIBUTE PHARMACEUTICALS CANADA INC.

(a company existing under the laws of Ontario)

SERIES A SECURED DEBENTURE DUE JUNE 16, 2016

WHEREAS the Holder has agreed to subscribe for the Debenture issued by the Corporation;

NOW THEREFORE it is hereby covenanted, agreed and declared as follows:

ARTICLE 1

INTERPRETATION

1.1 Definitions

In this Debenture, unless something in the subject matter or context is inconsistent therewith:

"Business Day" means any day other than a Saturday, Sunday, legal holiday or a day on which banking institutions are closed in Toronto, Ontario;

"Change of Control" shall have the meaning given thereto in the Corporate Finance Manual of the TSX Venture Exchange;

"Corporation" means Tribute Pharmaceuticals Canada Inc., a corporation existing under the laws of Ontario and its successors and assigns;

"Date of Issue" means the date as of which this Debenture is issued;

"Debenture," the "Debenture," "herein," "hereby," "hereof," "hereto," "hereunder" and similar expressions mean or refer to this interest bearing, secured series A debenture and any debenture, deed or instrument supplemental or ancillary thereto and any schedules hereto or thereto and not to any particular article, section, subsection, clause, subclause or other portion hereof;

"Director" means a director of the Corporation, and reference to “action by the Directors” means action by the Directors as a board or, whenever duly empowered, by the executive committee of the board;

"Event of Default" means any of the events specified in Article 5 hereof;

"Holder" or "Debentureholder" has the meaning set out in Section 2.1;

"Interest Rate" has the meaning set out in Section 2.2;

"Lead Agent" means KES 7 Capital Inc.;

"Lien" means any security interest, mortgage, deed of trust, pledge, lien, charge, encumbrance, title retention agreement or analogous instrument or device, including the interest of each lessor under any capitalized lease and the interest of any bondsman under any payment or performance bond, in, of or on any assets or properties of a Person, whether now owned or hereafter acquired and whether arising by agreement or operation of law;

"Maturity Date" has the meaning set out in Section 2.1;

"Person" means an individual, corporation, partnership, unincorporated syndicate, unincorporated organization, trust, trustee, executor, administrator, or other legal representative, or any group or combination thereof;

"Redemption Fee" has the meaning set out in Section 2.7;

"Principal Sum" has the meaning set out in Section 2.1;

"Property" means, with respect to any Person, all or any portion of that Person's undertaking, property and assets, both real and personal, including, for greater certainty, any share in the capital of a corporation or ownership interest in any other Person;

"Secured Assets" shall have the meaning ascribed to such term in Section 3.1; and

"Security" means all security held from time to time by or on behalf of the Holder, securing or intended to secure directly or indirectly the indebtedness, liability and obligations of this Debenture and includes all security described in Section 3.1.

“Subscription Agreement” means the Subscription Agreement dated as of June 16, 2015 between the Corporation and the Holder.

1.2 Meaning of Outstanding

This Debenture shall be deemed to be outstanding until it is indefeasibly re-paid in accordance with its terms and cancelled or delivered to the Corporation for cancellation, provided that where a new Debenture has been issued in substitution for a Debenture that has been mutilated, lost, stolen or destroyed, only one of such Debentures shall be counted for the purpose of determining the aggregate principal amount of Debentures outstanding.

1.3 Non-Business Days

Whenever any payment to be made hereunder shall be stated to be due, any period of time would begin or end, any calculation is to be made or any other action to be taken hereunder shall be stated to be required to be taken on a day other than a Business Day, such payment, period of time, or other action shall be taken on the next succeeding Business Day and an extension of time shall be included for the purposes of computation of interest thereon. Any payment made after 3:00 p.m. (Toronto time) on a Business Day shall be deemed to be made on the following Business Day.

1.4 Currency

All references to currency herein are to lawful money of Canada and all payments towards the Principal Sum shall be made in such currency.

1.5 Headings

The headings of all the Articles and Sections hereof and the table of contents are inserted for convenience of reference only and shall not affect the construction or interpretation of this Debenture.

1.6 Governing Law

This Debenture shall be governed by and construed in accordance with the laws of the Province of Ontario and the federal laws of Canada applicable therein and shall be treated in all respects as an Ontario contract.

1.7 Singular, Gender, Legislation, Etc.

Words importing the singular number only include the plural and vice versa, words importing any gender include any other gender and words importing persons include individuals, partnerships, associations, trusts, unincorporated organizations and corporations and any reference to any statute or other legislation shall be deemed to be a reference to such legislation as now enacted or as the same may from time to time be amended, re-enacted or replaced.

1.8 Severability

If any one or more of the provisions or parts thereof contained in this Debenture should be or become invalid, illegal or unenforceable, the remaining provisions or parts thereof contained herein shall be and shall be conclusively deemed to be, severable therefrom and the validity, legality or enforceability of such remaining provisions or parts thereof shall not in any way be affected or impaired by the severance of the provisions or parts thereof severed.

1.9 Binding Effect

This Debenture and all of its provisions shall enure to the benefit of the Holder, its successors and assigns, and shall be binding upon the Corporation and its successors and assigns. The expression the "Holder" as used herein shall include the Holder's assigns whether immediate or derivative

1.10 Time

Time shall be of the essence of this Debenture.

ARTICLE 2

THE DEBENTURE

2.1 Indebtedness.

The Corporation, for value received, and in consideration of the premises hereby acknowledges itself indebted and promises and covenants to pay to ____________, the registered holder hereof (the "Holder"):

(1)	the principal sum of $_______________ (the "Principal Sum") on June 16, 2016 (the "Maturity Date") or sooner upon the occurrence of an Event of Default or upon such other date as specified herein at the principal office of the Holder _________________________________;

(2)	interest on any monies owing by the Corporation to the Holder hereunder and under the Security, all as specifically calculated hereunder and thereunder; and

(3)	all other monies which may be owing by the Corporation to the Holder pursuant to this Debenture and under the Security.

2.2 Application of Payments.

The Holder shall, and the Corporation hereby authorizes the Holder to apply all payments made by the Corporation against the Principal Amount and interest thereon and other monies which are payable by the Corporation under this Debenture in the following order: (i) all expenses and other monies from time to time payable hereunder (other than the Principal Amount and interest thereon), (ii) interest payable hereunder, and (iii) the Principal Amount.

2.3 Calculation and Payment of Interest, etc.

(1)

The Corporation shall pay interest on that portion of the Principal Sum outstanding from time to time from the date hereof up to and including the date of payment of the Principal Sum at the rate of 6% per annum (simple interest not compounded) (the "Interest Rate"), in like money at the said place, calculated on a calendar year basis and payable quarterly in arrears (less any tax required by law to be deducted), with the first payment being made on July 31, 2015. The quarterly interest due on the Principal Sum shall be computed for the actual number of days elapsed during the period in question on the basis of a year consisting of three hundred sixty five (365) days and shall be calculated by determining the average daily principal balance outstanding for each day of the period in question. The daily rate shall be equal to 1/365th times the Interest Rate.

(2)	All interest payable hereunder on becoming overdue shall bear interest at the rate of ten percent (10%) per annum until such overdue interest is paid in full. Overdue interest shall be payable forthwith without demand by the Holder.

(3)

The covenant of the Corporation to pay interest at the rate provided herein shall not merge in any judgement in respect of any obligation of the Corporation hereunder and such judgement shall bear interest in the manner set out in this Section 2.2 and be payable on the same days when interest (whether hereunder or otherwise) is payable hereunder.

(4)

For purposes of disclosure pursuant to the Interest Act (Canada), the annual rates of interest or fees to which the rates of interest or fees provided in this Debenture (and stated herein or therein, as applicable, to be computed on the basis of a three hundred sixty-five (365) day year or any other period of time less than a calendar year) are equivalent to the rates so determined multiplied by the actual number of days in the applicable calendar year and divided by three hundred sixty-five or (365) or such other period of time, respectively

2.4 Designation and Terms of Debenture

(1)

This Debenture is one of a series of like debentures, except as to principal amount, of the Corporation issued and to be issued for evidencing a principal sum not exceeding in the aggregate of $15,000,000 (the “ Series A 2015 Debentures”) all bearing interest at the rate and in the manner provided in Article 2 hereof. All Series A 2015 Debentures of the said series are to rank pari passu without any preference or priority one over another.

(2)	This Debenture shall be issued and fully registered as a Series A 2015 Debenture in the denomination of $1,000,000, shall be dated as of the Date of Issue and shall mature on the Maturity Date.

2.5 Registration and Transfer

(1)

The Corporation shall cause to be kept at a central register at the principal office of the Corporation in the city of Milton, Ontario, in which shall be entered the name and address of the Holder of the Debenture and particulars of the Debenture held by the Holder. Such registration shall be noted on the Debenture by the Corporation or other registrar designated by the Corporation.

(2)	The Holder shall be entitled to have the Debenture transferred upon compliance with applicable securities laws, rules and regulations.

(3)

A transferee of a Debenture shall, upon compliance with any and all requirements prescribed under this Debenture or by law and after a duly completed transfer form substantially in the form of Schedule "B" hereto is lodged with the Corporation, be entitled to be entered on a register as the owner of such Debenture.

(4)	For the purposes of this Section 2.5, a "transfer" shall include a transfer or pledge to a lender, pledgee, mortgagee or other encumbrancer for the purpose of giving collateral for a debt.

(5)

Neither the Corporation nor any other registrar shall be bound to take notice of or see to the execution of any trust, whether express, implied or constructive, in respect of this Debenture, and this Debenture may be transferred on the direction of the Holder thereof, whether named as trustee or otherwise, as though that person were also the beneficial owner thereof.

(6)	The Holder shall be entitled to inspect the register of Debentureholders at any time during normal business hours of the Corporation or other registrar and to make extracts therefrom.

(7)	The rights contained in any replacement Debenture resulting from a transfer shall rank in all respects pari passu with the rights contained in the Debenture which it replaces and such replacement Debenture shall for all purposes be taken and deemed to be the Debenture as originally issued.

(8)	The Holder of this certificate shall have the benefit of all representations, warranties and covenants contained in the Subscription Agreement whether such Holder was a party to such Agreement.

2.6 Ownership and Payment

(1)

Subject to any applicable law, the person in whose name any Debenture is registered shall for all the purposes hereof be and be deemed to be the owner thereof and payment of or on account of the Principal Sum and accrued interest, shall be made only to or upon the order in writing of such person and such payment shall be a good and sufficient discharge to the Corporation and any other registrar for the amount so paid.

(2)

The registered holder for the time being of any Debenture shall be entitled to the Principal Sum and all accrued interest, free from all equities or rights of set off or counterclaim between the Corporation and the original or any intermediate holder thereof (except any equities of which the Corporation is required to take notice by statute or by order of a court of competent jurisdiction) and all persons may act accordingly, and the payment to any such holder of any such Principal Sum and all accrued interest shall be a good discharge to the Corporation for the same, and neither the Corporation nor any registrar shall be bound to enquire into the title of any such holder.

2.7 Redemption

The Series A 2015 Debentures may be redeemed at any time by the Corporation subject to the payment to the Holder of the Principal Sum plus any accrued and unpaid interest and a redemption fee equal to 4.0% of the Principal Sum (the "Redemption Fee"). On any redemption the Principal Sum plus any accrued and unpaid interest and the Redemption Fee will be payable forthwith by the Corporation to the Lead Agent, on behalf of the Holder or as otherwise determined by the Lead Agent, acting in its sole discretion.

2.8 Change of Control

In the event of a Change of Control of the Corporation the Series A 2015 Debentures shall be deemed to be automatically redeemed and the Principal Sum plus any accrued and unpaid interest, the Redemption Fee and all other amounts due hereunder or under the Security will become immediately due and payable to the Lead Agent, on behalf of the Holder or as otherwise determined by the Lead Agent, acting in its sole discretion immediately following such Change of Control.

2.9 Termination Fee

At the Maturity Date or upon the acceleration of the obligations under Section 5.1 hereof the Corporation will pay a termination fee to the Holder in an amount equal to 2.0% of the Principal Sum.

2.10 Mutilation, Loss or Destruction of Debenture

In case this Debenture shall become mutilated or be lost, destroyed or stolen, the Corporation, in its discretion, may issue a new Debenture of like date and tenor in substantially the same form upon surrender and cancellation of the mutilated Debenture or, in the case of a lost, destroyed or stolen Debenture, in lieu of and in substitution for the same. In the case of loss or destruction or theft, the applicant for a substituted Debenture shall furnish to the Corporation such evidence of such loss or destruction or theft as shall be satisfactory to the Corporation in its discretion and shall also furnish an indemnity or letter of credit of a Canadian chartered bank or such other indemnity as is satisfactory to the Corporation in its discretion. The applicant for a new or substituted Debenture shall pay all expenses incidental to the issuance of such new or substituted Debenture.

ARTICLE 3

SECURITY INTEREST

3.1 Security Interest

As general and continuing security for the due payment of the Debenture by the Corporation to the Holder, the Holder shall be granted a general security agreement from the Corporation in favour of the Holder, constituting a Lien on all of the present and future Property of the Corporation (the "Secured Assets") pari passu with all other Holders of Debentures but subordinated to the security granted from time to time by the Corporation pursuant to the credit agreement dated as of August 8, 2013, as amended, (the “Senior Credit Agreement”) entered into by and between the Corporation and each of the financial institutions from time to time party thereto (individually each a "Lender" and collectively "Lenders") and SWK Funding LLC, a Delaware limited liability company, in its capacity as administrative agent for the other Lenders (the "Senior Debt").

3.2 Further Assurances

The Corporation shall, subject as herein provided, forthwith and from time to time, execute and do or cause to be executed and done all deeds, documents and things which, in the opinion of the Holder or its solicitor, are necessary or advisable for giving the Holder (so far as may be possible under the local laws of the places where the Secured Assets are situated) a valid security interest of the nature herein specified upon any undertaking, property, rights and assets, whether now owned or hereafter acquired, intended to be included therein and a valid cession and transfer thereof for and to secure the payment of the indebtedness, liabilities and obligations of the Corporation under this Debenture and the Security.

3.3 Registration

The Corporation shall record, file or register this Debenture, and all other instruments of further assurance (including financial statements), without delay, wherever and whenever in the opinion of the Lead Agent or its solicitor it would be necessary or advisable to perfect, preserve and protect the Lien hereof, the rights of the Holder hereunder for such action to be taken, under the provisions of any and all statutes providing for or permitting the registration of the Security in the Province of Ontario and shall renew such recordings, filings, enterings or registrations from time to time as and when required to keep them in full force and effect.

ARTICLE 4

COVENANTS OF THE CORPORATION

4.1 General Covenants

The Corporation hereby represents and warrants that, so long as this Debenture is in force and except as otherwise permitted with the Holder's prior written consent:

(1)	it will duly and punctually pay to the Holder the Principal Sum, the interest thereon and all other sums payable hereunder on the dates and at the places, and in the manner provided for herein;

(2)	it will at all times maintain its corporate existence; will carry on and conduct, and will cause to be carried on and conducted, its business in a proper, efficient and businesslike manner and in accordance with good business practice;

(3)	other than in respect of the Senior Debt, it will not grant or permit to exist any Liens over any of its property or assets except Permitted Liens (as defined in the Security);

(4)	it will fully and effectually maintain and keep maintained the security granted to the Holder as a valid and effective security at all times;

(5)

it will do, observe and perform all of its obligations and all matters and things necessary or expedient to be done, observed or performed under or by virtue of any lease agreement, joint venture agreement, license, or other contract, so long as the same is, in the opinion of the Directors, acting reasonably, of commercial value, in order to preserve, protect and maintain the rights of the Corporation and will not suffer or permit any default for which any such lease, agreement, joint venture agreement, license, or contract might be terminated or for which any other party thereto might be relieved of any of its obligations thereunder or for which any obligations of any such party might be reduced;

(6)	it will not sell or otherwise dispose of by conveyance, transfer, lease or otherwise any of its assets or undertaking other than in the ordinary course of business;

(7)	it will keep and maintain proper books of account and records accurately covering all aspects of the business affairs of the Corporation;

(8)

it will at all times promptly observe, perform, execute and comply with all applicable laws, rules, requirements, orders, directions, by-laws, ordinances, work orders and regulations of every governmental authority and agency whether federal, provincial, state, municipal or otherwise, except where any such non-compliance would not have a material adverse effect on the Corporation and its subsidiaries, taken as a whole; and

(9)	it will give the Holder prompt written notice of the occurrence of any Event of Default, or any event or circumstance that, with the giving of notice or lapse of time or both, would constitute an Event of Default.

4.2 Audit

The Corporation shall furnish to the Debentureholder a copy of the consolidated audited annual and quarterly financial statements of the Corporation and of the report, if any, of the Corporation's Auditors thereon at the same time as they are furnished to the shareholders of the Corporation.

ARTICLE 5

DEFAULT AND ENFORCEMENT

5.1 Acceleration of Maturity on Default

Each of the following shall constitute an event of default (hereinafter referred to as an "Event of Default"):

(1)	if the Corporation does not pay when due any amount of the Principal Sum or interest or other amount payable by it under the Debenture at the place and in the currency in which such amount is expressed to be payable;

(2)

any default shall occur under the terms applicable to any indebtedness (other than this Debenture) in an aggregate principal amount (for all such indebtedness so affected and including undrawn committed or available amounts and amounts owing to all creditors under any combined or syndicated credit arrangement) exceeding $250,000 and such default shall (a) consist of the failure to pay such indebtedness when due (after giving effect to applicable grace periods), whether by acceleration or otherwise, or (b) accelerate the maturity of such indebtedness or permit the holder or holders thereof, or any trustee or agent for such holder or holders, to cause such indebtedness to become due and payable prior to its expressed maturity;

(3)

if the Corporation makes a general assignment for the benefit of creditors; or any proceeding is instituted by it seeking relief as debtor, or to adjudicate it a bankrupt or insolvent, or seeking liquidation, winding-up, reorganization, arrangement, adjustment or composition of it or its debts or for an order for similar relief under any law relating to bankruptcy, insolvency, reorganization or relief of debtors (including under any statutes relating to the incorporation of companies) or seeking appointment of a receiver or trustee, or other similar official for it or for any substantial part of its properties or assets; or any corporate or partnership action is taken to authorize any of the actions referred to in this Section 5.1(3);

(4)

if any proceedings are instituted against the Corporation seeking to adjudicate it a bankrupt or insolvent, or seeking liquidation, winding-up, reorganization, arrangement, adjustment or composition of it or its debts or an order for similar relief under any law relating to bankruptcy, insolvency, reorganization or relief of debtors (including under any statutes relating to the incorporation of companies) or seeking appointment of a receiver, trustee or other similar official for it or for any substantial part of its properties or assets;

(5)	if any proceedings with respect to the Corporation are commenced under the Companies' Creditors Arrangement Act (Canada);

(6)

if the Corporation takes any corporate proceedings for its dissolution, liquidation or if the corporate existence of the Corporation shall be terminated by expiration, forfeiture, order or otherwise, or if the Corporation ceases or threatens to cease, to carry on all or a substantial part of its business;

(7)	if a petition is filed for the winding up of the Corporation;

(8)	if an Event of Default (as such term is defined in the Senior Credit Agreement) occurs which is not waived by the Lenders;

(9)

if any execution, sequestration, extent or any other process of any court becomes enforceable against the Corporation or if a distress or analogous process is levied upon the property of the Corporation or any part thereof, provided that such execution, sequestration, extent or other process is not in good faith being contested by the Corporation;

(10)	if the Corporation ceases or threatens to cease to carry on its business or if the Corporation commits or threatens to commit any act of bankruptcy;

(11)	if the Corporation defaults in the performance or observance of any term, condition, covenant, representation or warranty contained in this Debenture or in any of the Security documents; or

(12)	if the Security, or any part thereof, ceases at any time after its execution and delivery to constitute a second lien against the assets of the Corporation.

Should an Event of Default occur and be continuing, the Holder may in its sole discretion declare the Principal Sum, any accrued interest thereon of this Debenture, the Termination Fee and all other sums due hereunder and under the Security to be due and payable on demand, and the same shall forthwith become immediately due and payable provided that, upon the occurrence of any Event of Default described in Sections 5.1(3), (4) or (5) hereof no notice or declaration shall be required and all such amounts shall become immediately due and payable.

5.2 Waiver of Default

The Holder shall have the power to waive any default or to cancel any declaration made by the Holder upon such terms and conditions as the Debentureholder shall prescribe provided always that no waiver, act or omission of the Holder shall extend to or be taken in any manner whatsoever to affect any subsequent breach or default of the same or any other provision of this Debenture.

5.3 Costs.

The Corporation agrees to pay to the Holder forthwith upon demand all costs, charges and expenses, including reasonable legal fees on a full indemnity basis, of or incurred by the Holder in recovering or enforcing payment of any of the monies owing hereunder, together with interest thereon at the rate as herein set forth in this Debenture from the date of incurring such costs, charges and expenses until paid.

5.4 Remedies Cumulative

No remedy herein conferred upon or to the Debentureholder is intended to be exclusive of any other remedy, but each and every other remedy shall be cumulative and shall be in addition to every other remedy given hereunder or now existing or hereafter to exist by law or by statute.

ARTICLE 6

CONSOLIDATION AND AMALGAMATION

6.1 Successor Corporation

The Corporation shall not enter into any transaction whereby all or substantially all of its undertaking, property and assets would become the property of any other corporation (herein called a "successor corporation") whether by way of reorganization, reconstruction, consolidation, amalgamation, merger, transfer, sale or otherwise, unless (i) such transaction constitutes a Change of Control and the Corporation complies with Section 2.8 or (ii) prior to or contemporaneously with the consummation of such transaction, the Holder's written consent has been obtained and, the Corporation and the successor corporation shall have executed such instruments and done such things as, in the opinion of the Holder's solicitor, are necessary or advisable to establish that upon the consummation of such transaction:

(1)	the successor corporation will have assumed all the covenants and obligations of the Corporation under this Debenture; and

(2)	this Debenture will be a valid and binding obligation of the successor corporation entitling the Holder, as against the successor corporation, to all the rights of the Debentureholder under this Debenture.

6.2 Successor to Possess Powers of the Corporation

Whenever the conditions of Section 6.1 hereof shall have been duly observed and performed, the successor corporation shall possess and from time to time may exercise each and every right and power of the Corporation under this Debenture in the name of the Corporation or otherwise and any act or proceeding by any provision hereof required to be done or performed by any Director or officer of the Corporation may be done and performed with like force and effect by the like directors or officers of the successor corporation.

ARTICLE 7

NOTICES

7.1 Notice

Any notice by one party to the other party under the provisions hereof shall be valid and effective if delivered, sent by e-mail, facsimile or mailed by prepaid registered mail to the other party at:

In the case of the Corporation:

Tribute Pharmaceuticals Canada Inc.

151 Steeles Avenue East

Milton, Ontario

L9T 1Y1

Attention:

Fax Number:

e-mail:

In the case of the Holder:

at the address set forth on the register of holders required to be maintained pursuant to Section 2.4 hereof.

and, subject as provided in this Section 7.1, shall be deemed to have been given at the time of delivery or sending by facsimile or electronic transmission or on the fifth Business Day after mailing. Any delivery made or facsimile or electronic transmission sent on a day other than a Business Day or after 4:00 p.m. (Toronto time) on a Business Day, shall be deemed to be received on the next following Business Day. In the case of disruption in postal services, any notice shall be delivered or sent by facsimile or electronic transmission. Either party may from time to time notify the other party of a change in address or facsimile number which thereafter, until changed by like notice, shall be the address or facsimile number of such party giving notice for all purposes of this Debenture.

ARTICLE 8

SUPPLEMENT TO DEBENTURE

8.1 Supplement to Debenture

From time to time the Corporation shall, when so directed by the Holder, execute, acknowledge and deliver by their proper officers deeds or instruments supplemental hereto, which thereafter shall form part hereof, for any one or more of the following purposes:

(1)

making such provisions not inconsistent with this Debenture as may be necessary or desirable with respect to matters or questions arising hereunder, including the making of any modifications in the form of the Debenture which do not affect the substance thereof and which provisions and modifications will not, in the opinion of the Holder's solicitor, be prejudicial to the interests of the Holder;

(2)	evidencing the succession or the successive successions of other corporations to the Corporation and the covenants of and obligations assumed by any such successor in accordance with the provisions of this Debenture; and

(3)	for any other purpose not inconsistent with the terms of this Debenture.

The Corporation may correct any typographical or other manifest errors in this Debenture, provided that in the opinion of the Holder such corrections will not prejudice the rights of the Holder hereunder and may execute all such documents as may be necessary to correct such errors.

ARTICLE 9

SATISFACTION AND DISCHARGE

9.1 Discharge

Upon the Principal Sum and interest (including interest on amounts in default, if any) on this Debenture and all other money payable hereunder having been paid or satisfied, the Debentureholder shall forthwith, at the request of the Corporation, release and discharge this Debenture. Upon such request, the Debentureholder shall execute and deliver such instruments as it shall be advised by the Corporation's counsel are requisite to release the Corporation from its covenants herein contained.

ARTICLE 10

MISCELLANEOUS PROVISIONS

10.1 Debenture Duly Authorized, Executed and Binding

The Corporation represents and warrants to and in favour of the Holder that this Debenture has been issued in accordance with resolutions of the directors of the Corporation, and all other matters and things have been done and performed so as to authorize and make the creating and issue of the Debenture and its execution and delivery legal, valid and binding in accordance with the constitutional documents of the Corporation and all other statutes and laws in that behalf, and this Debenture is given as security for unconditional and absolute payment of the Principal Amount and all other monies entitled to the benefit of the security hereby created, with interest thereon at the rate aforesaid, payable in the manner and at the times and places hereinbefore set forth and also as security for the due performance of all obligations of the Corporation hereunder and for the purposes and subject to the conditions, provisions, covenants and stipulations herein expressed.

The Debenture shall be signed by a duly authorized representative of the Corporation. Notwithstanding any change in any of the persons holding office between the time of the actual signing of the Debenture and the certification and delivery of such Debenture, any Debenture signed as aforesaid shall be valid and binding upon the Corporation.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

IN WITNESS WHEREOF the Corporation has caused this Debenture to be signed by its Chief Financial Officer as of the Date of Issue, being June 16, 2015.

	TRIBUTE PHARMACEUTICALS CANADA INC.

	Per:
		Name: Steven Goldman
		Title: Director

	I have authority to bind the Corporation

SCHEDULE "A"

TRANSFER FORM

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers to (name of transferee) $ (indicate principal amount of debentures being transferred) principal amount Secured Series A Debenture of Tribute Pharmaceuticals Canada Inc. (the "Corporation") represented by certificate(s) no. (indicate number(s) of certificate(s) being transferred) and irrevocably constitutes and appoints (indicate name of transferee) attorney to transfer such debenture(s) on the securities register of the Corporation, with full power of substitution.

DATED:

	IF TRANSFEROR IS A CORPORATION:



	By:

	Name:

	Title:

Signature guaranteed:

The signature must be guaranteed by a Canadian chartered bank or a member of a recognized stock exchange or other entity acceptable to the Corporation.

Ontario, Canada		001-31198		Not Applicable
(State or Incorporation)		(Commission File Number)		(I.R.S. Employer Identification Number)

Exhibit No.		Description
1.1*		Share Purchase Agreement, dated as of June 16, 2015, by and among Tribute Pharmaceuticals Canada Inc. and the shareholders of Medical Futures Inc.
1.2		Agency Agreement, dated as of June 16, 2015, by and among Tribute Pharmaceuticals Canada Inc., and KES 7 Capital Inc., Bloom Burton & Co. Ltd, Mackie Research Capital Corporation, Laurentian Bank Securities Inc. and Dundee Capital Markets Ltd.
4.1*		Promissory Note issued in connection with the Acquisition on June 16, 2015
4.2		Form of Debenture for the Debenture Offering that closed on June 16, 2015
99.1		Press Release dated June 17, 2015

Exhibit No.		Description
1.1*		Share Purchase Agreement, dated as of June 16, 2015, by and among Tribute Pharmaceuticals Canada Inc. and the shareholders of Medical Futures Inc.
1.2		Agency Agreement, dated as of June 16, 2015, by and among Tribute Pharmaceuticals Canada Inc., and KES 7 Capital Inc., Bloom Burton & Co. Ltd, Mackie Research Capital Corporation, Laurentian Bank Securities Inc. and Dundee Capital Markets Ltd.
4.1*		Promissory Note issued in connection with the Acquisition on June 16, 2015
4.2		Form of Debenture for the Debenture Offering that closed on June 16, 2015
99.1		Press Release dated June 17, 2015

Article 1 INTERPRETATION		1
1.1	Definitions	1
1.2	Knowledge	7
1.3	Currency	7
1.4	Governing Law	7
1.5	Interpretation Not Affected by Headings	7
1.6	Number and Gender	7
1.7	Time of Essence	7
1.8	Severability	7
1.9	Accounting Terms	7
1.10	Calculation of Time Periods	8
1.11	Statutory Instruments	8
1.12	Incorporation of Schedules and Exhibits	8
Article 2 PURCHASE AND SALE		9
2.1	Purchased Shares	9
2.2	Payment of Consideration	9
2.3	Milestones, Contingent Payments and Other Payments	10
2.4	Deposit	11
2.5	Retention Payments	12
Article 3 REPRESENTATIONS AND WARRANTIES		12
3.1	Representations and Warranties of the Vendors	12
3.2	Representations and Warranties of the Purchaser	25
3.3	Survival of Representations and Warranties of the Vendors	27
3.4	Survival of Representations and Warranties of the Purchaser	28
Article 4 COVENANTS		28
4.1	Conduct During Interim Period	28
4.2	Access to Information	30
4.3	Satisfaction of Closing Conditions	30
4.4	Transition Period	30
4.5	Board Representation	30
4.6	Delivery of Records	30
Article 5 CONDITIONS OF CLOSING		31
5.1	Conditions for the Benefit of the Purchaser	31
5.2	Waiver or Termination by the Purchaser	32

5.3	Conditions for the Benefit of the Vendors	33
5.4	Waiver or Termination by the Vendors	34
5.5	Survival following Termination	34
Article 6 CLOSING ARRANGEMENTS		34
6.1	Place of Closing	34
6.2	Deliveries at the Closing	34
Article 7 INDEMNIFICATION		34
7.1	Indemnification by the Vendors	35
7.2	Indemnification by the Purchaser	35
7.3	Notice of Claim	35
7.4	Procedure for Indemnification	36
7.5	General Indemnification Rules	36
Article 8 GENERAL		38
8.1	Notices	38
8.2	Public Announcements and Disclosure	39
8.3	No Assignment	39
8.4	Best Efforts	39
8.5	Expenses	40
8.6	Further Assurances	40
8.7	Entire Agreement	40
8.8	Waiver or Amendment	40
8.9	Rights Cumulative	40
8.10	Successors	40
8.11	Set Off	41
8.12	Counterparts	41

	Tribute Pharmaceuticals Canada Inc.

June 22, 2015	By:	/ s/ Scott Langille
		Scott Langille
		Chief Financial Officer

SCHEDULE 1.1(W) EXCLUDED EMPLOYEES		43
SCHEDULE 1.1(PP) PERMITTED ENCUMBRANCES		44
SCHEDULE 1.1(RR) PRODUCTS		45
SCHEDULE 1.1(FFF) TERRITORIES		46
SCHEDULE 2.3(3) [**]1		47
SCHEDULE 2.3(4) [**]2		48
SCHEDULE 2.5 LISTED EMPLOYEES		49
SCHEDULE 3.1(18) REGULATORY AND CONTRACTUAL CONSENTS		50
SCHEDULE 3.1(23) CONSENTS NECESSARY TO CARRY ON LAWFUL OPERATIONS		51
SCHEDULE 3.1(29) LITIGATION		52
SCHEDULE 3.1(33) LIST OF MATERIAL CONTRACTS		53
SCHEDULE 3.1(34) INSURANCE		54
SCHEDULE 3.1(35) LIST OF BANK, TRUST AND OTHER ACCOUNTS AND POWERS OF ATTORNEY		55
SCHEDULE 3.1(37) LIST OF MAJOR CUSTOMERS, WHOLESALERS AND DISTRIBUTORS		56
SCHEDULE 3.1(38) SUMMARY OF CANADIAN FEDERAL AND PROVINCIAL INCOME TAX ASSESSMENTS		57
SCHEDULE 3.1(40) ENVIRONMENTAL MATTERS		58
SCHEDULE 3.1(40) LABOUR AND EMPLOYEE MATTERS		59
SCHEDULE 3.1(42) LIST OF PRODUCT WARRANTIES		60
SCHEDULE 3.1(43) INTELLECTUAL PROPERTY		61
SCHEDULE 3.1(44) REGULATORY APPROVALS		62
EXHIBIT A NON-COMPETITION AGREEMENT		63
EXHIBIT B PROMISSORY NOTE		64
EXHIBIT C TRANSITION SERVICES AGREEMENT		72
EXHIBIT D NEW LEASE		73

1 [**] – Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portion.
2 [**] – Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portion.

Schedule Number:	Title:
Schedule 1.1(w)	Excluded Employees
Schedule 1.1(pp)	Permitted Encumbrances
Schedule 1.1(rr)	Products
Schedule 1.1(fff)	Territories
Schedule 2.3(3)	[**]4
Schedule 2.3(4)	[**]5
Schedule 2.5	Listed Employees
Schedule 3.1(18)	Regulatory and Contractual Consents
Schedule 3.1(23)	Consents necessary to carry on lawful operations
Schedule 3.1(29)	Litigation
Schedule 3.1(33)	List of material Contracts
Schedule 3.1(34)	List of insurance policies
Schedule 3.1(35)	List of bank, trust and other accounts and powers of attorney
Schedule 3.1(37)	List of major customers, wholesalers and distributors
Schedule 3.1(38)	Summary of Canadian federal and provincial income tax assessments
Schedule 3.1(40)	Environmental Matters
Schedule 3.1(40)	Labour and employee matters
Schedule 3.1(42)	List of Product Warranties
Schedule 3.1(43)	Intellectual property matters
Schedule 3.1(44)	Regulatory Approvals
Exhibit A	Non-Competition Agreement
Exhibit B	Promissory Note
Exhibit C	Transition Services Agreement
Exhibit D	New Lease

TRIBUTE PHARMACEUTICALS CANADA INC.


Per:	/s/ Robert Harris
	Robert Harris
	President and CEO
	Tribute Pharmaceuticals Canada Inc.


	Certificate No. 2015-___. SECURED SUBORDINATE DEBENTURE OF TRIBUTE PHARMACEUTICALS CANADA INC.

Article 1 INTERPRETATION			3
	1.1	Definitions	3
	1.2	Meaning of Outstanding	4
	1.3	Non-Business Days	4
	1.4	Currency	5
	1.5	Headings	5
	1.6	Governing Law	5
	1.7	Singular, Gender, Legislation, Etc.	5
	1.8	Severability	5
	1.9	Binding Effect	5
	1.1	Time	5
Article 2 The debenture			6
	2.1	Indebtedness.	6
	2.2	Application of Payments.	6
	2.3	Calculation and Payment of Interest, etc.	6
	2.4	Designation and Terms of Debenture	7
	2.5	Registration and Transfer	7
	2.6	Ownership and Payment	8
	2.7	Redemption	9
	2.8	Change of Control	9
	2.9	Termination Fee	9
	2.1	Mutilation, Loss or Destruction of Debenture	9
Article 3 Security interest			9
	3.1	Security Interest	9
	3.2	Further Assurances	10
	3.3	Registration	10
Article 4 Covenants of the Corporation			10
	4.1	General Covenants	10
	4.2	Audit	12
Article 5 Default and Enforcement			12
	5.1	Acceleration of Maturity on Default	12
	5.2	Waiver of Default	13
	5.3	Costs.	14
	5.4	Remedies Cumulative	14
Article 6 Consolidation and Amalgamation			14
	6.1	Successor Corporation	14
	6.2	Successor to Possess Powers of the Corporation	14
Article 7 Notices			15
	7.1	Notice	15
Article 8 Supplement to Debenture			15
	8.1	Supplement to Debenture	15
Article 9 Satisfaction and Discharge			16
	9.1	Discharge	16
Article 10 MISCELLANEOUS PROVISIONS			16
	10.1	Debenture Duly Authorized, Executed and Binding	16
SCHEDULE "A" TRANSFER FORM			18