<SEC-DOCUMENT>0001171843-17-001289.txt : 20170303
<SEC-HEADER>0001171843-17-001289.hdr.sgml : 20170303
<ACCEPTANCE-DATETIME>20170303153807
ACCESSION NUMBER:		0001171843-17-001289
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		6
CONFORMED PERIOD OF REPORT:	20170303
ITEM INFORMATION:		Entry into a Material Definitive Agreement
ITEM INFORMATION:		Regulation FD Disclosure
ITEM INFORMATION:		Financial Statements and Exhibits
FILED AS OF DATE:		20170303
DATE AS OF CHANGE:		20170303

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			XBiotech Inc.
		CENTRAL INDEX KEY:			0001626878
		STANDARD INDUSTRIAL CLASSIFICATION:	PHARMACEUTICAL PREPARATIONS [2834]
		IRS NUMBER:				000000000
		STATE OF INCORPORATION:			A1
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-37347
		FILM NUMBER:		17663276

	BUSINESS ADDRESS:	
		STREET 1:		8201 E. RIVERSIDE DRIVE
		STREET 2:		BUILDING 4, SUITE 100
		CITY:			AUSTIN
		STATE:			TX
		ZIP:			78744
		BUSINESS PHONE:		512-386-2930

	MAIL ADDRESS:	
		STREET 1:		8201 E. RIVERSIDE DRIVE
		STREET 2:		BUILDING 4, SUITE 100
		CITY:			AUSTIN
		STATE:			TX
		ZIP:			78744
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>f8k_030317.htm
<DESCRIPTION>FORM 8-K
<TEXT>
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<P STYLE="font-size: 18pt; text-align: center; margin: 0pt 0"><B>UNITED STATES</B></P>

<P STYLE="font-size: 18pt; text-align: center; margin: 0pt 0"><B>SECURITIES AND EXCHANGE COMMISSION</B></P>

<P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0"><B>Washington, D.C. 20549</B></P>

<P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 18pt; text-align: center; margin: 0pt 0"><B>FORM 8-K</B></P>

<P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0"><FONT STYLE="font-size: 11pt"><B>CURRENT REPORT</B></FONT></P>

<P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0"><FONT STYLE="font-size: 11pt"><B>Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934</B></FONT></P>

<P STYLE="font-size: 10pt; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0"><B>Date of Report (Date of earliest event reported): March 3, 2017</B></P>

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<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; font-size: 10pt; text-align: center"><FONT STYLE="font-size: 18pt"><B>XBIOTECH INC.</B></FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Exact name of Registrant as specified in its charter)</B></FONT></TD></TR>
</TABLE>

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    <TD COLSPAN="2" STYLE="font-size: 10pt; text-align: center"><FONT STYLE="font-size: 11pt"><B>British Columbia, Canada</B></FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD COLSPAN="2" STYLE="font-size: 10pt; text-align: center"><FONT STYLE="font-size: 10pt">(State of Incorporation)</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 50%; font-size: 10pt; text-align: center">&nbsp;</TD>
    <TD STYLE="width: 50%; font-size: 10pt; text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD COLSPAN="2" STYLE="font-size: 10pt; text-align: center"><FONT STYLE="font-size: 11pt"><B>001-37347</B></FONT></TD></TR>
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<P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0">(Commission File Number)</P>

<P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0">&nbsp;</P>

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    <TD STYLE="width: 100%; font-size: 10pt; text-align: center"><FONT STYLE="font-size: 11pt"><B>N/A</B></FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt; text-align: center"><FONT STYLE="font-size: 10pt">(I.R.S. Employer Identification No.)</FONT></TD></TR>
</TABLE>
<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font-size: 10pt; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="width: 50%">
        <P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0"><FONT STYLE="font-size: 11pt"><B>8201 E Riverside Dr. Bldg
        4, Ste 100</B></FONT></P>
        <P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0"><FONT STYLE="font-size: 11pt"><B>Austin, Texas</B></FONT></P>
        <P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0">(Address of principal executive offices)</P></TD>
    <TD STYLE="width: 50%">
        <P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0"><FONT STYLE="font-size: 11pt"><B>78744</B></FONT></P>
        <P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0">(Zip Code)</P></TD></TR>
</TABLE>
<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0"><FONT STYLE="font-size: 11pt"><B>(512) 386-2900</B></FONT></P>

<P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0">(Registrant&rsquo;s telephone number, including area code)</P>

<P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0">(Former Name or Former Address, if Changed Since Last Report)</P>

<P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; margin: 0pt 0">Check the appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following provisions:</P>

<P STYLE="font-size: 10pt; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; margin: 0pt 0"><FONT STYLE="font-family: Wingdings">o</FONT> Written communications pursuant to Rule&nbsp;425
under the Securities Act (17 CFR 230.425)</P>

<P STYLE="font-size: 10pt; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; margin: 0pt 0"><FONT STYLE="font-family: Wingdings">o</FONT> Soliciting material pursuant to Rule&nbsp;14a-12
under the Exchange Act (17 CFR 240.14a-12)</P>

<P STYLE="font-size: 10pt; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; margin: 0pt 0"><FONT STYLE="font-family: Wingdings">o</FONT> Pre-commencement communications pursuant
to Rule&nbsp;14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))</P>

<P STYLE="font-size: 10pt; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; margin: 0pt 0"><FONT STYLE="font-family: Wingdings">o</FONT> Pre-commencement communications pursuant
to Rule&nbsp;13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))</P>

<P STYLE="font-size: 10pt; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; margin: 0pt 0"></P>

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<P STYLE="font-size: 10pt; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1in"><B>Item 1.01</B></TD><TD><B>Entry into a Material Definitive Agreement.</B></TD></TR></TABLE>

<P STYLE="font-size: 10pt; text-indent: 0.5in; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">On March 3, 2017, XBiotech Inc. (the &ldquo;Company&rdquo;) entered
into subscription agreements with accredited investors (the &ldquo;Subscription Agreements&rdquo;) providing for the issuance and
sale by the Company of approximately $31 million of common shares in a registered direct offering. The transaction was completed
from the Company&rsquo;s shelf registration at $13 per share. The closing of the offering is expected to take place on or about
March 8, 2017, subject to the satisfaction of customary closing conditions.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">The Company is offering the shares pursuant to a prospectus supplement
dated March 3, 2017, and a prospectus dated September 1, 2016, which is part of a registration statement on Form S-3 (Registration
No. 333-213218) that was declared effective by the Securities and Exchange Commission on September 1, 2016. The opinion of Stikeman
Elliott LLP relating to the legality of the shares is filed as Exhibit 5.1 to this Current Report on Form 8-K.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; margin: 0pt 0">The foregoing summary of the Subscription Agreements does not purport to be complete
and is qualified in its entirety by reference to the Subscription Agreement, a form of which is included as Exhibit 10.1 to this
Current Report on Form 8-K and incorporated by reference herein.</P>

<P STYLE="font-size: 10pt; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font-size: 10pt; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font-size: 10pt; margin: 0pt 0"><B>Item 7.01 Regulation FD Disclosure.</B></P>

<P STYLE="font-size: 10pt; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">On March 3, 2017, XBiotech Inc. (the &ldquo;Company&rdquo;) issued
a press release announcing the offering. A copy of the press release issued in connection with the announcement is furnished as
Exhibit 99.1 to this Current Report on Form 8-K.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">This Current Report on Form 8-K shall not constitute an offer to
sell or the solicitation of an offer to buy any shares under the Offering, nor shall there be any sale of such shares in any state
in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of
any such state.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0"><I>This Form 8-K and the related press release contain forward-looking
statements, including declarations regarding management's beliefs and expectations, that involve substantial risks and uncertainties.
In some cases, you can identify forward-looking statements by terminology such as &ldquo;may,&rdquo; &ldquo;will,&rdquo; &ldquo;should,&rdquo;
&ldquo;would,&rdquo; &ldquo;could,&rdquo; &ldquo;expects,&rdquo; &ldquo;plans,&rdquo; &ldquo;contemplate,&rdquo; &ldquo;anticipates,&rdquo;
&ldquo;believes,&rdquo; &ldquo;estimates,&rdquo; &ldquo;predicts,&rdquo; &ldquo;projects,&rdquo; &ldquo;intend&rdquo; or &ldquo;continue&rdquo;
or the negative of such terms or other comparable terminology, although not all forward-looking statements contain these identifying
words. Forward-looking statements are subject to inherent risks and uncertainties in predicting future results and conditions that
could cause the actual results to differ materially from those projected in these forward-looking statements. These risks and uncertainties
are subject to the disclosures set forth in &quot;Risk Factors&quot; in our SEC filings.</I></P>

<P STYLE="font-size: 10pt; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1in"><B>Item 9.01</B></TD><TD STYLE="text-align: justify"><B>Financial Statements and Exhibits.</B></TD></TR></TABLE>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">(d) Exhibits</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0"></P>

<TABLE BORDER="0" CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR>
    <TD STYLE="vertical-align: middle; text-align: center; width: 8%">Exhibit</TD>
    <TD STYLE="vertical-align: middle; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 91%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: middle">
    <TD STYLE="text-decoration: underline; text-align: center">Number</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-decoration: underline">Description</TD></TR>
<TR STYLE="vertical-align: middle">
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: middle">
    <TD STYLE="text-align: center">5.1</TD>
    <TD>&nbsp;</TD>
    <TD>Opinion of Stikeman Elliott LLP.</TD></TR>
<TR STYLE="vertical-align: middle">
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: middle">
    <TD STYLE="text-align: center">10.1</TD>
    <TD>&nbsp;</TD>
    <TD>Form of XBiotech Inc. Subscription Agreement</TD></TR>
<TR STYLE="vertical-align: middle">
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: middle">
    <TD STYLE="text-align: center">99.1</TD>
    <TD>&nbsp;</TD>
    <TD>Press Release of XBiotech Inc., Issued March 3, 2017.</TD></TR>
</TABLE>


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<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; margin: 0pt 0"></P>

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<P STYLE="font-size: 10pt; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; text-align: center"> <B>SIGNATURES</B></P>



<P STYLE="font-size: 10pt; text-align: justify; text-indent: -247.5pt; margin: 0pt 0 0pt 3.5in">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">Pursuant to the requirements of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0"></P>

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<TR>
    <TD STYLE="vertical-align: middle; text-align: justify">Date:&nbsp;&nbsp;March 3, 2017</TD>
    <TD COLSPAN="2" STYLE="vertical-align: middle; text-align: left">XBIOTECH INC.</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR>
    <TD STYLE="vertical-align: middle; text-align: justify; width: 50%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 3%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 27%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 20%">&nbsp;</TD></TR>
<TR>
    <TD STYLE="vertical-align: middle; text-align: justify">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">By:&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: justify; border-bottom: Black 1.1pt solid">&nbsp;/s/ John Simard</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: justify">John Simard</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="vertical-align: middle; text-align: justify">Chief Executive Officer and President</TD></TR>
</TABLE>


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<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: right; text-indent: -0.5in; margin: 0pt 0 0pt 0.5in"><B>&nbsp;</B></P>



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<TYPE>EX-5.1
<SEQUENCE>2
<FILENAME>exh_51.htm
<DESCRIPTION>EXHIBIT 5.1
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<P STYLE="margin: 0; text-align: right"><B>Exhibit 5.1</B></P>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin-top: 0; text-align: center; margin-bottom: 0"><img src="se_logo.jpg"></P>

<P STYLE="margin: 0"></P>

<P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif">Stikeman
Elliott LLP &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Barristers &amp; Solicitors</FONT></P>

<P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif">&nbsp;</FONT></P>

<P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif"><BR>
Suite 1700, Park Place, 666 Burrard Street, Vancouver, B.C., Canada &nbsp;&nbsp;&nbsp;V6C 2X8</FONT></P>

<P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif">Tel: (604)
631-1300 &nbsp;&nbsp;&nbsp;Fax: (604) 681-1825 &nbsp;&nbsp;&nbsp;www.stikeman.com</FONT></P>



<P STYLE="margin: 0"></P>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top; text-align: left">
    <TD STYLE="width: 80%">&nbsp;</TD>
    <TD STYLE="width: 20%">March 3, 2017</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD NOWRAP>File No.: 131346.1001</TD></TR>
</TABLE>

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<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0"></P>

<P STYLE="font-size: 10pt; text-align: left; margin: 0pt 0">XBiotech Inc.<BR>
8201 E. Riverside Drive</P>

<P STYLE="font-size: 10pt; text-align: left; margin: 0pt 0">Building 4, Suite 100</P>

<P STYLE="font-size: 10pt; text-align: left; margin: 0pt 0">Austin, Texas</P>

<P STYLE="font-size: 10pt; text-align: left; margin: 0pt 0">USA 78744</P>

<P STYLE="font-size: 10pt; text-align: left; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: left; margin: 0pt 0">Dear Sirs/Mesdames:</P>

<P STYLE="font-size: 10pt; text-align: left; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0"><B>Re:&#9;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Registered Direct Offering of Common Shares of XBiotech
Inc.</B></P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; text-indent: 0.5in; margin: 0pt 0">We have acted as Canadian counsel to XBiotech
Inc. (the &quot;<B>Company</B>&quot;), a British Columbia company, in connection with those certain subscription agreements dated
March 3, 2017 (the &quot;<B>Subscription Agreements</B>&quot;) by and between the Company and the investors identified in the Subscription
Agreements (the &quot;<B>Subscribers</B>&quot;), providing for the issuance and sale (the &quot;<B>Offering</B>&quot;) by the Company
of up to an aggregate of 6,768,248 common shares in the capital of the Company (the &quot;<B>Shares</B>&quot;), no par value per
Share, to the Subscribers. Capitalized terms used herein and not defined shall have the meanings ascribed to such terms in the
Subscription Agreements.</P>

<P STYLE="font-size: 10pt; text-align: justify; text-indent: 0.5in; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; text-indent: 0.5in; margin: 0pt 0">For the purposes of this opinion, we have also
examined and relied upon originals or copies of the following documents (collectively, the &quot;<B>Corporate Documents</B>&quot;):</P>

<P STYLE="font-size: 10pt; text-align: justify; text-indent: 0.5in; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(a)</FONT></TD><TD STYLE="text-align: justify">certificate of good standing provided by the Registrar of Companies of British Columbia with respect
to the Company (the &quot;<B>Certificate of Good Standing</B>&quot;);</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font-size: 10pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(b)</FONT></TD><TD STYLE="text-align: justify">certificate of an officer of the Company (the &quot;<B>Officer's Certificate</B>&quot;);</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font-size: 10pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(c)</FONT></TD><TD STYLE="text-align: justify">the certificate of continuance (the &quot;<B>Certificate of Continuance</B>&quot;), notice of articles
and articles of the Company attached to the Officer's Certificate; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font-size: 10pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(d)</FONT></TD><TD STYLE="text-align: justify">certain resolutions of the Company's directors attached to the Officer's Certificate.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font-size: 10pt">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; text-indent: 0.5in; margin: 0pt 0">We have relied on the Corporate Documents as
to the matters provided for in them, without independent investigation, for purposes of providing our opinions expressed below.
In the case of our opinion in paragraph 1, we have relied exclusively on the Certificate of Continuance and the Certificate of
Good Standing.</P>

<P STYLE="font-size: 10pt; text-align: justify; text-indent: 0.5in; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; text-indent: 0.5in; margin: 0pt 0"></P>

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<P STYLE="font-size: 10pt; text-align: center; margin-top: 0pt; margin-bottom: 0pt"><img src="se_logosm.jpg"></P>

<P STYLE="font-size: 10pt; text-align: justify; text-indent: 0.5in; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; text-indent: 0.5in; margin: 0pt 0">In examining all documents and in providing
our opinions below we have assumed that:</P>

<P STYLE="font-size: 10pt; text-align: justify; text-indent: 0.5in; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(a)</FONT></TD><TD STYLE="text-align: justify">all individuals had the requisite legal capacity;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font-size: 10pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(b)</FONT></TD><TD STYLE="text-align: justify">all signatures are genuine;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font-size: 10pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(c)</FONT></TD><TD STYLE="text-align: justify">all documents submitted to us as originals are complete and authentic and all photostatic, certified,
telecopied, notarial or other copies conform to the originals;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font-size: 10pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(d)</FONT></TD><TD STYLE="text-align: justify">all facts set forth in the official public records, certificates and documents supplied by public
officials or otherwise conveyed to us by public officials are complete, true and accurate as of the date hereof;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font-size: 10pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(e)</FONT></TD><TD STYLE="text-align: justify">all facts set forth in the certificates supplied by the respective officers and directors of the
Company including, without limitation, the Officer's Certificates, are complete, true and accurate as of the date hereof; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font-size: 10pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(f)</FONT></TD><TD STYLE="text-align: justify">prior to the issuance and delivery of the Shares, the Company will receive the full consideration
in respect of such Shares.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font-size: 10pt">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; text-indent: 0.5in; margin: 0pt 0">Our <FONT STYLE="font-weight: normal">opinion</FONT>
below is expressed only with respect to the laws of the province of British Columbia and of the laws of Canada applicable therein
in effect on the date of this opinion (the &quot;<B>Applicable Law</B>&quot;). We have no responsibility or obligation to: (i)
update this opinion, (ii) take into account or inform the addressee, any Subscriber or any other person of any changes in law,
facts or other developments subsequent to this date that do or may affect the opinions we express, or (iii) advise the addressee,
any Subscriber or any other person of any other change in any matter addressed in this opinion. Nor do we have any responsibility
or obligation to consider the applicability or correctness of this opinion to any person other than the addressee.</P>

<P STYLE="font-size: 10pt; text-align: justify; text-indent: 0.5in; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; text-indent: 0.5in; margin: 0pt 0">Based on the above, and subject to the qualifications
below, we are of the opinion that:</P>

<P STYLE="font-size: 10pt; text-align: justify; text-indent: 0.5in; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">1.</FONT></TD><TD STYLE="text-align: justify">The Company is a corporation continued and validly existing under the laws of British Columbia
and is in good standing with respect to the filing of annual reports.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font-size: 10pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">2.</FONT></TD><TD STYLE="text-align: justify">The Company has all corporate power and authority necessary to own, lease, operate or hold its
properties and conduct the businesses in which it is engaged.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font-size: 10pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">3.</FONT></TD><TD STYLE="text-align: justify">The execution and delivery (to the extent delivery is a matter of Applicable Law) by the Company
of, and the performance by the Company of its obligations under, the Subscription Agreements have been duly authorized by all necessary
corporate action on the part of the Company.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font-size: 10pt">&nbsp;</P>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font-size: 10pt"></P>

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<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font-size: 10pt; text-align: center"><img src="se_logosm.jpg"></P>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font-size: 10pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">4.</FONT></TD><TD STYLE="text-align: justify">The Shares, when issued and delivered by the Company in accordance with the terms of the Subscription
Agreements against payment of the consideration set forth therein, will be validly issued, fully paid and non-assessable.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font-size: 10pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">5.</FONT></TD><TD STYLE="text-align: justify">The issuance and sale of the Shares by the Company is not subject to preemptive or other similar
rights arising under the articles of the Company or Applicable Law.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font-size: 10pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">6.</FONT></TD><TD STYLE="text-align: justify">The execution, delivery (to the extent delivery is a matter of Applicable Law) and performance
of the Subscription Agreements by the Company and the transactions contemplated thereby do not conflict with, or result in any
breach of, or constitute a default under (nor constitute an event that with notice, lapse of time or both would constitute a breach
of or default under): (i) the articles of the Company; or (ii) any Applicable Law.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font-size: 10pt">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; text-indent: 0.5in; margin: 0pt 0">This opinion is solely for the benefit of the
addressee and not for the benefit of any other person. It is rendered solely in connection with the transaction to which it relates.
It may not be quoted, in whole or in part, or otherwise referred to or used for any purpose without our prior written consent.</P>

<P STYLE="font-size: 10pt; text-align: justify; text-indent: 0.5in; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; text-indent: 0.5in; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top; text-align: left">
    <TD STYLE="width: 50%">&nbsp;</TD>
    <TD STYLE="width: 50%">Yours truly,</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD><I>&quot;Stikeman Elliott LLP&quot;</I></TD></TR>
</TABLE>

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<P STYLE="font-size: 10pt; text-align: justify; text-indent: 0.5in; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; text-indent: 0.5in; margin: 0pt 0">&nbsp;</P>



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</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.1
<SEQUENCE>3
<FILENAME>exh_101.htm
<DESCRIPTION>EXHIBIT 10.1
<TEXT>
<HTML>
<HEAD>
     <TITLE></TITLE>
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<BODY STYLE="font: 10pt Times New Roman, Times, Serif">

<P STYLE="margin: 0; text-align: right"><B>Exhibit 10.1</B></P>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0"></P>

<P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0"><B>SUBSCRIPTION AGREEMENT</B></P>

<P STYLE="font-size: 10pt; text-align: left; text-indent: 24.5pt; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; text-indent: 0.5in; margin: 0pt 0">This subscription agreement (this &ldquo;<B><I>Subscription
Agreement</I></B>&rdquo;) is made as of March ___, 2017, by and between the investor identified on the signature pages hereto (&ldquo;<B><I>Investor</I></B>&rdquo;)
and XBiotech, Inc., a British Columbia corporation (the &ldquo;<B><I>Company</I></B>&rdquo;), and the parties hereto agree as follows:</P>

<P STYLE="font-size: 10pt; text-align: justify; text-indent: 0.5in; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0"><B>1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Subscription</U></B></P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company has authorized the sale and issuance to the Investor and certain other investors (the &ldquo;<B><I>Other Investors</I></B>&rdquo;)
of up to an aggregate of ____________ common shares (each, a &ldquo;<B><I>Share</I></B>&rdquo; and collectively, the &ldquo;<B><I>Shares</I></B>&rdquo;),
no par value, for a purchase price of $____ per Share (the &ldquo;<B><I>Purchase Price</I></B>&rdquo;).</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
offering and sale of the Shares (the &ldquo;<B><I>Offering</I></B>&rdquo;) are being made pursuant to (i) an effective Registration
Statement on Form S-3 (File No. 333-213218), as such Registration Statement may be amended and supplemented from time to time (including
pursuant to Rule 462(b) of the Securities Act (as defined in Section 2(b) below) (the &ldquo;<B><I>Registration Statement</I></B>&rdquo;),
filed by the Company with the Securities and Exchange Commission (the &ldquo;<B><I>Commission</I></B>&rdquo;), including the prospectus
contained therein dated September 1, 2016 (the &ldquo;<B><I>Base Prospectus</I></B>&rdquo;); (ii) if applicable, certain &ldquo;free
writing prospectuses&rdquo; (as that term is defined in Rule 405 under the Securities Act (as defined below)) that have been or
will be filed, if required, with the Commission and delivered to the Investor on or before the date hereof, containing certain
supplemental information regarding the terms of the Offering and the Company; and (iii) a Prospectus Supplement (the &ldquo;<B><I>Prospectus
Supplement</I></B>&rdquo; and together with the Base Prospectus, the &ldquo;<B><I>Prospectus</I></B>&rdquo;) containing certain
supplemental information regarding the Shares and the terms of the Offering and information that may be material to the Company
and its securities that was delivered to the Investor and will be filed with the Commission. The Prospectus, together with the
documents incorporated by reference therein, are collectively referred to herein as the &ldquo;<B><I>Disclosure Package</I></B>.&rdquo;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Investor agrees to purchase from the Company the number of Shares set forth on the signature pages hereto for the aggregate Purchase
Price set forth below on the signature pages hereto on or before 6 p.m. Central Time on Friday, March 3<SUP>rd</SUP>, 2017 (the
&ldquo;<B><I>Commitment Date</I></B>&rdquo;), otherwise the Company shall have the option to terminate this Subscription Agreement.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At
the Closing (as defined in Section 2(a) below), the Company and the Investor agree that the Investor will purchase from the Company
and the Company will issue and sell to the Investor, upon the terms and conditions set forth herein, the number of Shares set forth
on the signature pages hereto for the aggregate Purchase Price set forth below on the signature pages hereto. The Investor acknowledges
that the Offering is not being underwritten and that there is no minimum offering amount.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company proposes to enter into substantially this same form of Agreement with the Other Investors and expects to complete the sale
of Shares to the Other Investors simultaneously with the Closing (as defined below). The Investor and the Other Investors are hereinafter
sometimes collectively referred to as the &ldquo;Investors,&rdquo; and this Subscription Agreement and the Subscription Agreements
executed by the Other Investors are hereinafter sometimes collectively referred to as the &ldquo;<B><I>Agreements</I></B>.&rdquo;
The Company represents and warrants that this Subscription Agreement is and will be the same in all material respects as other
subscription agreements entered into pursuant to or in connection with the Offering.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(f)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
Subscription Agreement will involve no obligation or commitment of any kind until this Subscription Agreement is accepted and countersigned
by or on behalf of the Company.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0"></P>

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<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0"><B>2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Closing and Delivery
of the Shares and Funds</U>.</B></P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
completion of the purchase and sale of the Shares (the &ldquo;<B><I>Closing</I></B>&rdquo;) shall take place at 6:00 p.m. Central
Time on Wednesday, March 8, 2017, or at such other time as the Company and the Investor shall agree (the &ldquo;<B><I>Closing Date</I></B>&rdquo;),
at the offices of Bryan Cave LLP, 120 Broadway, Suite 300, Santa Monica, CA 90401. At the Closing, (a) the Company shall cause
the Company&rsquo;s transfer agent to deliver to the Investor, via electronic book-entry in accordance with the instructions provided
by the Investor on the signature pages hereto, the number of Shares set forth on the signature pages hereto, registered in the
name of the Investor (such Shares, the &ldquo;<B><I>Investor Shares</I></B>&rdquo;), and (b) the aggregate Purchase Price for the
Investor Shares as set forth on the signature pages hereto will be delivered by or on behalf of the Investor to the Company.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company&rsquo;s obligation to issue and sell the Investor Shares to the Investor and the Investor&rsquo;s obligation to purchase
the Investor Shares from the Company shall be subject to: (x) no objection shall have been raised by The NASDAQ Stock Market, LLC
with respect to the consummation of the transactions contemplated by the Agreements in the absence of approval by the Company&rsquo;s
shareholders of such transactions and (y) no stop order suspending the effectiveness of the Registration Statement or any part
thereof, or preventing or suspending the use of the Base Prospectus or the Prospectus or any part thereof, shall have been issued
and no proceedings for that purpose or pursuant to Section 8A under the Securities Act of 1933, as amended (the &ldquo;<B><I>Securities
Act</I></B>&rdquo;), shall have been initiated or threatened by the Commission.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0"><B>3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Representations,
Warranties and Covenants of the Company</U>.</B> The Company acknowledges, represents and warrants to, and agrees with, the Investor
that:</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company has the requisite right, power and authority to enter into the Agreements, to authorize, issue and sell the Shares as contemplated
by the Agreements and to perform and to discharge its obligations hereunder; and the Agreements have been duly authorized, executed
and delivered by the Company, and constitute valid and binding obligations of the Company enforceable in accordance with their
respective terms, except (i) as may be limited by bankruptcy, insolvency, reorganization or other similar laws relating to enforcement
of creditors&rsquo; rights generally and by general principles of equity and (ii) to the extent any indemnification or contribution
provisions contained therein may further be limited by applicable laws and principles of public policy.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Shares to be issued and sold by the Company to the Investor and the Other Investors under the Agreements have been duly authorized
and the Shares, when issued and delivered against payment therefor as provided in the Agreements, will be validly issued, fully
paid and non-assessable and free of any preemptive or similar rights. The Registration Statement is effective under the Securities
Act and no stop order preventing or suspending the effectiveness of the Registration Statement or suspending or preventing the
use of the Prospectus has been issued by the Commission and no proceedings for that purpose have been instituted or, to the knowledge
of the Company, are threatened by the Commission. The Company, if required by the rules and regulations of the Commission, proposes
to file the Prospectus, with the Commission pursuant to Rule 424(b) in relation to the sale of the Shares.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(c) The execution and delivery of the Agreements
and the consummation of the transactions contemplated hereby and thereby will not (i) result in a breach or violation of any of
the terms and provisions of, or constitute a default under, any law, rule or regulation to which the Company or any subsidiary
is subject, or by which any property or asset of the Company or any subsidiary is bound or affected, (ii) conflict with, result
in any violation or breach of, or constitute a default (or an event that with notice or lapse of time or both would become a default)
under, or give to others any right of termination, amendment, acceleration or cancellation (with or without notice, lapse of time
or both) of, any agreement, lease, credit facility, debt, note, bond, mortgage, indenture or other instrument or obligation or
other understanding to which the Company or any subsidiary is a party of by which any property or asset of the Company or any subsidiary
is bound or affected, or (iii) result in a breach or violation of any of the terms and provisions of, or constitute a default under,
the Company&rsquo;s Articles, except in the case of clauses (i) and (ii) such breaches, violations, defaults, or conflicts which
are not, individually or in the aggregate, reasonably likely to result in a material adverse effect upon the business, properties,
operations, condition (financial or otherwise) or results of operations of the Company and its subsidiaries, taken as a whole,
or in its ability to perform its obligations under the Subscription Agreement.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0"></P>

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<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company shall, by 8:00 a.m. (Central time) on the trading day immediately following the date of pricing of the Offering, issue
a press release disclosing the material terms of the Offering, and issue a Current Report on Form 8-K including the form of subscription
agreement as an exhibit thereto. The Company agrees that neither the press release nor the Current Report on Form 8-K will contain
the identity of the Investor or the Other Investors, unless otherwise required by law or any regulatory agency that regulates the
Company.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0"><B>4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Representations,
Warranties and Covenants of the Investor</U>.</B> The Investor acknowledges, represents and warrants to, and agrees with, the Company
that:</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Investor (i) is knowledgeable, sophisticated and experienced in making, and is qualified to make decisions with respect to, investments
in securities presenting an investment decision like that involved in the purchase of the Investor Shares, including investments
in securities issued by the Company and investments in comparable companies, (ii) has answered all questions on the signature pages
hereto and the answers thereto are true and correct as of the date hereof and will be true and correct as of the Closing Date and
(iii) in connection with its decision to purchase the Investor Shares, has received (or otherwise had made available to it by the
filing by the Company of an electronic version thereof with the Commission) prior to or in connection with the receipt of this
Subscription Agreement, and is relying only upon the Disclosure Package (including the documents incorporated by reference therein)
in making its decision to purchase the Investor Shares.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)
If the Investor is outside the United States, it will comply with all applicable laws and regulations in each foreign jurisdiction
in which it purchases, offers, sells or delivers Investor Shares or has in its possession or distributes any offering material,
in all cases at its own expense and (ii) no agent of the Company has been authorized to make and no such agent has made any representation,
disclosure or use of any information in connection with the issue, placement, purchase and sale of the Investor Shares, except
as set forth in or incorporated by reference in the Base Prospectus or the Prospectus Supplement or as otherwise contemplated by
this Subscription Agreement.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)
The Investor has full right, power, authority and capacity to enter into this Subscription Agreement and to consummate the transactions
contemplated hereby and has taken all necessary action to authorize the execution, delivery and performance of this Subscription
Agreement, and (ii) this Subscription Agreement constitutes a valid and binding obligation of the Investor enforceable against
the Investor in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting creditors&rsquo; and contracting parties&rsquo; rights generally and except as enforceability
may be subject to general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity
or at law) and except as to the enforceability of any rights to indemnification or contribution that may be violative of the public
policy underlying any law, rule or regulation (including any federal or state securities law, rule or regulation).</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0"></P>

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<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Investor Shares to be purchased by the Investor hereunder will be acquired for the Investor&rsquo;s own account, not as nominee
or agent, and not with a view to the resale or distribution of any part thereof in violation of the Securities Act, and the Investor
has no present intention of selling, granting any participation in, or otherwise distributing the same in violation of the Securities
Act without prejudice, however, to the Investor&rsquo;s right at all times to sell or otherwise dispose of all or any part of such
Investor Shares in compliance with applicable federal and state securities laws. If the Investor is an affiliate of the Company
(within the meaning of Rule 144 promulgated under the Securities Act), the Investor acknowledges and understands that the Investor
Shares may not be resold by the Investor unless such resale is registered under the Securities Act or such resale is effected pursuant
to a valid exemption from the registration requirements of the Securities Act.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Investor understands that nothing in this Subscription Agreement, the Prospectus, the Disclosure Package or any other materials
presented to the Investor in connection with the purchase and sale of the Investor Shares constitutes legal, tax or investment
advice. The Investor has consulted such legal, tax and investment advisors as it, in its sole discretion, has deemed necessary
or appropriate in connection with its purchase of Investor Shares.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(f)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Since
the date on which the Company or its agents first contacted such Investor about the Offering, the Investor has not directly or
indirectly, nor has any person acting on behalf of or pursuant to any understanding with the Investor, disclosed any information
regarding the Offering to any third parties (other than its legal, accounting and other advisors) or engaged in any transactions
in the securities of the Company (including, without limitations, any short sales (as defined in Rule 200(a) of Regulation SHO)
involving the Company&rsquo;s securities). The Investor covenants that neither it nor any person acting on its behalf or pursuant
to any understanding with it will engage in any transactions in the securities of the Company (including short sales) prior to
the time that the transactions contemplated by this Subscription Agreement are publicly disclosed.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(g)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
or before the Closing Date, the Investor will deliver to the Company an executed lock-up agreement in form and substance acceptable
to the Company. The Investor understands that in connection with the Offering, the Other Investors will execute lock-up agreements
that are the same in all material respects as the lock-up agreement executed by the Investor.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0"><B>5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Miscellaneous</U>.</B></P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Entire
Agreement; Modifications</U>. Except as otherwise provided herein, this Subscription Agreement constitutes the entire understanding
and agreement between the parties with respect to its subject matter and there are no agreements or understandings with respect
to the subject matter hereof which are not contained in this Subscription Agreement. This Subscription Agreement may be modified
only in writing signed by the signed by the Company and the Investor.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Survival</U>.
All representations, warranties, and agreements of the Company and the Investor herein shall survive delivery of, and payment for,
the Investor Shares purchased hereunder.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Counterparts</U>.
This Subscription Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and
the same instrument and shall become effective when counterparts have been signed by each party and delivered to the other parties
hereto, it being understood that all parties need not sign the same counterpart. Execution may be made by delivery of a facsimile
or PDF.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Severability</U>.
The provisions of this Subscription Agreement are severable and, in the event that any court or officials of any regulatory agency
of competent jurisdiction shall determine that any one or more of the provisions or part of the provisions contained in this Subscription
Agreement shall, for any reason, be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision or part of a provision of this Subscription Agreement and this Subscription
Agreement shall be reformed and construed as if such invalid or illegal or unenforceable provision, or part of such provision,
had never been contained herein, so that such provisions would be valid, legal and enforceable to the maximum extent possible,
so long as such construction does not materially adversely affect the economic rights of either party hereto.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0"></P>

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<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Notices</U>.
All notices or other communications required or permitted to be provided hereunder shall be in writing and shall be deemed effectively
given (i) upon personal delivery to the party to be notified, (ii) when sent by confirmed e-mail, telex or facsimile if sent during
normal business hours of the recipient, if not, then on the next business day, (iii) five days after having been sent by registered
or certified mail, return receipt requested, postage prepaid, or (iv) one day after deposit with a nationally recognized overnight
courier, specifying next day delivery, with written verification of receipt. All communications shall be sent to the Company or
the Investor, as applicable, at the address for such recipient listed on the signature pages hereto or at such other address as
such recipient has designated by two days advance written notice to the other parties hereto.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(f)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Governing
Law</U>. This Subscription Agreement shall be governed by, and construed in accordance with, the internal laws of the Province
of British Columbia without regard to the choice of law principles thereof.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(f)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Headings</U>.
The headings of the various sections of this Subscription Agreement have been inserted for convenience of reference only and will
not be deemed to be part of this Subscription Agreement.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(g)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Confirmation
of Sale</U>. The Investor acknowledges and agrees that such Investor&rsquo;s receipt of the Company&rsquo;s counterpart to this
Subscription Agreement shall constitute written confirmation of the Company&rsquo;s acceptance and agreement to sell the Investor
Shares to the Investor.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0; text-indent: 0.5in">(h)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Termination</U>.
In the event that the Company shall not have received this Agreement executed by the Investor on or before the Commitment Date,
the Company shall have the option to terminate this Subscription Agreement.</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: center; margin: 0pt 0">[S<I>ignature pages follow</I>]</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0"></P>

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<P STYLE="font-size: 10pt; text-align: justify; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: left; text-indent: 24.5pt; margin: 0pt 0">IN WITNESS WHEREOF, the parties hereto have executed
this Subscription Agreement effective as of the date first written above.</P>

<P STYLE="font-size: 10pt; text-align: left; text-indent: 24.5pt; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: left; text-indent: 24.5pt; margin: 0pt 0"></P>

<TABLE BORDER="0" CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; vertical-align: middle; text-align: left">XBIOTECH INC.</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="width: 50%">&nbsp;</TD>
    <TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 30%">&nbsp;</TD>
    <TD STYLE="width: 15%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: left">By:</TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1.1pt solid">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: left">Name:</TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1.1pt solid">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: left">Title:</TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1.1pt solid">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
</TABLE>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0"></P>

<TABLE BORDER="0" CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR>
    <TD STYLE="vertical-align: bottom; width: 50%">&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: left; width: 50%">Address for notice:</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: left">XBiotech Inc.</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: left">8201 E. Riverside Drive, Bldg. 4, Suite 100</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: left">Austin, TX 78744</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: left">Attention: Queena Han</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: left">Email: qhan@xbiotech.com</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: left">Facsimile: (512) 389-9877</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: left">With copies to:</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: left">Bryan Cave LLP</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: left">120 Broadway, Suite 300</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: left">Santa Monica, CA 90401</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: left">Attention: David G. Andersen</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: left">E-mail: dgandersen@bryancave.com</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: left">Facsimile: (310) 576-2200</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: left">&nbsp;</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: left">Stikeman Elliott LLP</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: left">666 Burrard Street, Suite 1700</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: left">Vancouver, BC Canada V6C 2X8</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: left">Attention: John F. Anderson</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: left">E-mail: janderson@stikeman.com</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: left">Facsimile: (604) 681-1825</TD></TR>
</TABLE>


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<P STYLE="font-size: 10pt; text-align: center; margin-top: 0pt; margin-bottom: 0pt">[Signature Page to Subscription Agreement]</P>

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    <TD STYLE="vertical-align: bottom; width: 15%">&nbsp;</TD></TR>
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    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: middle; text-align: left">Title:&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1.1pt solid">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR>
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<TR>
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<P STYLE="font-size: 10pt; text-align: left; margin: 0pt 0">Aggregate Purchase Price: _____________________________________</P>

<P STYLE="font-size: 10pt; text-align: left; margin: 0pt 0">&nbsp;</P>

<P STYLE="font-size: 10pt; text-align: left; margin: 0pt 0">Employer Identification or Social Security Number: _______________________</P>

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<TR>
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<TR>
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<TR>
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<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>4
<FILENAME>exh_991.htm
<DESCRIPTION>EXHIBIT 99.1
<TEXT>
<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN"><html lang="en-US"><head><title>EdgarFiling</title><meta content="text/html; charset=windows-1252"><meta name="GENERATOR" content="MSHTML 8.00.7601.18094"></head><body bgcolor="#ffffff"><p style="text-align: right;"><strong>EXHIBIT 99.1</strong></p><p style="text-align: center;"><strong>XBiotech Announces Registered Direct Offering of Common Shares</strong></p><p style="text-align: center;"><p> <p align="left">AUSTIN, Texas, March  03, 2017  (GLOBE NEWSWIRE) -- XBiotech Inc. (NASDAQ:XBIT) today announced that it has entered into definitive agreements to sell an aggregate of approximately US$31,000,000 of common shares in a registered direct offering. The transaction was completed from the Company&#8217;s shelf registration at $13 per share.</p>  <p align="justify">The closing of this offering is expected to take place on or about&#160;March 8, 2017, subject to the satisfaction of customary closing conditions. XBiotech&#8217;s president &amp; CEO, John Simard, stated, &#8220;I am very pleased to complete this strategic offering, giving us secure runway while we await outcomes of key near-term milestones. Our ability at this time to execute this substantial direct offering is testament to the strength, commitment and confidence of our shareholder base.&#8221;</p>  <p align="justify">Net proceeds of the offering will be used primarily for continued development of XBiotech&#8217;s clinical programs, commercialization expenses upon possible EMA/FDA approval(s), manufacturing operations and general corporate purposes. &#160;</p>  <p align="justify">The common shares are being offered pursuant to an effective shelf registration statement on Form S-3 previously filed with and declared effective by the Securities and Exchange Commission. &#160;The prospectus supplement and accompanying prospectus relating to the offering contain important information relating to the XBiotech common shares. The prospectus supplement will be filed with the SEC and will be available on the SEC's website at&#160;http://www.sec.gov, or may be obtained, when available, by contacting XBiotech Inc.., Attn: Investor Relations, 8201 E. Riverside Drive Bldg. 4, Ste. 100 Austin, TX 78744, or by telephone at: (512) 386-2900.</p>  <p align="justify">This press release shall not constitute an offer to sell nor the solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.&#160; This offering may only be made by means of a prospectus supplement and related base prospectus.</p>  <p align="justify"><strong>About&#160;XBiotech</strong><strong><br> </strong>XBiotech is a fully integrated global biosciences company dedicated to pioneering the discovery, development and commercialization of therapeutic antibodies based on its True Human&#153; proprietary technology. XBiotech currently is advancing a robust pipeline of antibody therapies to redefine the standards of care in oncology, inflammatory conditions and infectious diseases. Headquartered in Austin, Texas, XBiotech also is leading the development of innovative biotech manufacturing technologies designed to more rapidly, cost-effectively and flexibly produce new therapies urgently needed by patients worldwide.</p>  <p><strong>Cautionary Note on Forward-Looking Statements</strong><br>This press release contains forward-looking statements, including with respect to the proposed offering of common shares, declarations regarding management's beliefs and expectations that involve substantial risks and uncertainties. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "would," "could," "expects," "plans," "contemplate," "anticipates," "believes," "estimates," "predicts," "projects," "intend" or "continue" or the negative of such terms or other comparable terminology, although not all forward-looking statements contain these identifying words. Forward-looking statements are subject to inherent risks and uncertainties in predicting future results and conditions that could cause the actual results to differ materially from those projected in these forward-looking statements. These risks and uncertainties are subject to the disclosures set forth in the "Risk Factors" section of certain of our SEC filings. Forward-looking statements are not guarantees of future performance, and our actual results of operations, financial condition and liquidity, and the development of the industry in which we operate, may differ materially from the forward-looking statements contained in this press release. Any forward-looking statements that we make in this press release speak only as of the date of this press release. We assume no obligation to update our forward-looking statements whether as a result of new information, future events or otherwise, after the date of this press release.</p></p><p>Contact<br>Ashley Otero<br>aotero@xbiotech.com<br>512-386-2930</p></body></html>
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</DOCUMENT>
<DOCUMENT>
<TYPE>GRAPHIC
<SEQUENCE>6
<FILENAME>se_logosm.jpg
<DESCRIPTION>GRAPHIC
<TEXT>
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end
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
