Attached files
| file | filename |
|---|---|
| 8-K - CURRENT REPORT - Adamis Pharmaceuticals Corp | adamis-8k_0114.htm |
| EX-10.5 - SUBSIDIARY GUARANTEE AGREEMENT - Adamis Pharmaceuticals Corp | ex-10_5.htm |
| EX-10.3 - SECURITY AGREEMENT - Adamis Pharmaceuticals Corp | ex-10_3.htm |
| EX-10.4 - FORM OF LOCK-UP AGREEMENT - Adamis Pharmaceuticals Corp | ex-10_4.htm |
| EX-10.2 - 10% SENIOR SECURED CONVERTIBLE NOTE - Adamis Pharmaceuticals Corp | ex-10_2.htm |
Exhibit
10.1
SECURITIES PURCHASE
AGREEMENT
This
Securities Purchase Agreement (“Agreement”) is entered into as
of January 11, 2010 by and between ADAMIS PHARMACEUTICALS CORPORATION, a
corporation organized under the laws of the State of Delaware (the “Company”), on the one hand,
and each Person set forth on the signature page hereto as a “Purchaser”
hereunder (each a “Purchaser” and collectively
the “Purchasers”), on
the other hand.
WHEREAS,
subject to the terms and conditions set forth in this Agreement, the Company
desires to issue and sell to each Purchaser, and each Purchaser, severally and
not jointly, desires to purchase from the Company, Notes of the Company in a
PIPE Transaction as set forth herein; and
WHEREAS,
pursuant to that certain Agreement and Plan of Reorganization (“Merger Agreement”) dated as of
December 4, 2009 by and among La Jolla Pharmaceutical Company, a Delaware
corporation (“La
Jolla”), Jewel Merger Sub, Inc., a Delaware corporation and wholly-owned
subsidiary of La Jolla (“Merger
Sub”), and the Company, the Company has agreed to enter into a business
combination transaction with La Jolla pursuant to which Merger Sub will merge
with and into the Company (“Merger”) with (a) La Jolla
effecting a reverse stock split of its common stock, $0.01 par value per share
(“La Jolla Common
Stock”), immediately prior to the Merger, (b) the Company continuing
after the Merger as the surviving corporation and wholly-owned subsidiary of La
Jolla, and (c) each outstanding share of Company Common Stock being converted
into the number of shares of La Jolla Common Stock equal to the Exchange Ratio
(as defined in the Merger Agreement), each of (a) through (c) occurring in
accordance with the provisions of the Merger Agreement;
NOW
THEREFORE, in consideration of the foregoing premises and the covenants
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and each Purchaser
agree as follows:
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1.
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Incorporation by
Reference; Definitions.
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(a)
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Incorporation. This
Agreement incorporates by reference, as if set forth herein in its
entirety and including without limitation all terms, conditions and
provisions set forth therein, the PipeFund Services Organization Standard
Transaction Document labeled GTC 10-09 (General Terms and Conditions)
available and accessible at www.pipefund.com
(“PST Document
GTC”); provided,
however, that to the extent any of the terms, conditions or
provisions of PST Document GTC contradict or conflict with the terms,
conditions or provisions of this Agreement, this Agreement shall
control.
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(b)
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Defined
Terms. Each initially capitalized term used but not
defined in this Agreement (including PST Document GTC as incorporated
herein pursuant to the preceding Section), and each initially capitalized
term used but not defined in any other Transaction Document, shall have
the meaning ascribed thereto in the PipeFund Services Organization
Standard Transaction Document labeled 10-09 DEF (Definitions) available
and accessible at www.pipefund.com.
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1
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(c)
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Post
Merger. After the closing of the Merger, as used in the
Transaction Documents (i) the term “Company” shall refer to the Company
and La Jolla collectively, (ii) the term “Subsidiaries” shall refer to the
Company’s and La Jolla’s Subsidiaries collectively, (iii) the term “Notes”
shall include the Notes (as may be amended and/or restated) and any
promissory notes, debentures, bonds or other debt instruments issued by La
Jolla to the holders of Notes in substitution for the Notes being issued
hereunder, (iv) the term “Common Stock” shall refer to La Jolla Common
Stock, and (v) the term “Collateral” shall include all assets of La Jolla
and its subsidiaries in addition to all the assets of the Company
immediately preceding the Merger. Any other terms which by
their context are intended to relate to La Jolla in lieu of the Company
following the Merger shall be so construed as
appropriate.
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(d)
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PipeFund Transaction
Code. This Securities Purchase Agreement shall be known
as “Securities Purchase Agreement
#ADMP-09-A”.
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2. Securities. The
Company agrees to issue and sell, and each Purchaser agrees to purchase,
severally and not jointly, in consideration for payment by such Purchaser of its
Subscription Amount indicated on such Purchaser’s signature page hereto, upon
the terms and conditions contained in this Securities Purchase Agreement, the
following Securities:
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(a)
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Notes. 10%
Senior Secured Convertible Notes of the Company, in the form attached
hereto as Exhibit A
(“Notes”), with an
aggregate original principal amount equal to such Purchaser’s Subscription
Amount, which Notes shall (i) bear interest at 10% per annum, (ii) be
convertible into shares of Common Stock at a Conversion Price of $0.20 per
share, (iii) be secured by a first priority perfected security interest on
all the assets of the Company and its Subsidiaries (including the
“Collateral” as defined in the Security Agreement) (except to the extent
set certain security interests are not perfected as set forth in the
Security Agreement), and (iv) mature on the date which is nine (9) months
following the Closing Date; and
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(b)
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Common
Stock. A number of Shares of the Company’s Common Stock
equal to such Purchaser’s Subscription Amount divided by $1.00.
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3. Specific
Terms.
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(a)
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The
Minimum Aggregate Investment Amount shall be $1,000,000, and the Maximum
Aggregate Investment Amount shall be
$1,500,000.
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(b)
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The
Bulletin Board shall constitute an additional Eligible
Market.
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(c)
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“Exempt
Issuance” shall also include any issuance of securities pursuant to
acquisitions, in-licensing of the Company’s Intellectual Property,
products or services, or other strategic transactions, in each case
approved by a majority of the members of the Board of Directors, provided
in each case any such issuance shall only be to a Person (or to the
shareholders or other equity owners of such Person) which is, itself or
through its subsidiaries, an operating company engaged in significant
business activities synergistic with the business of the Company and in
which the Company receives benefits in addition to the investment of funds
(if any), but shall not include (i) a transaction in which the Company is
issuing securities primarily for the purpose of raising capital or to an
entity whose primary business is investing in securities or (ii) any
issuances in connection with the Merger or acquisition, purchase or
licensing of assets (including any equity interests) from La Jolla or its
affiliates.
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2
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(d)
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Requisite
Purchasers means 67%-in-Interest of the Purchasers (with such
67%-in-Interest determined solely based on the outstanding principal
amount of Notes held by the Purchasers so long as any Notes are
outstanding, and thereafter based on the number of Shares purchased
hereunder and held by the
Purchasers).
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(e)
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The
Placement Agent is Shoreline
Pacific.
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4. Closing
Procedure.
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(a)
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Documents
Delivery. There shall not be any Escrow Agreement or
Documents Escrow Agreement. On or prior to the Closing Date,
the Company shall deliver original executed copies of each Note to Company
counsel with a copy to Peter J. Weisman, P.C. Issuer’s counsel
shall (a) hold each such Note in trust on behalf of the Purchasers and the
Company, and (b) deliver each such Note to the applicable Purchaser named
therein promptly following the Company’s acknowledgment that it has
received the Subscription Amount from the Purchaser of such
Note. All other Company Closing Documents shall be delivered to
Peter J. Weisman, P.C. on or prior to the Closing Date to hold in trust on
behalf of the Purchasers and the Company. A stock certificate
or other reasonably acceptable evidence of ownership of the Shares being
issued to each Purchaser hereunder shall be delivered to each such
Purchaser, in the name of such Purchaser, within five (5) Trading Days
following the Closing Date.
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(b)
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Condition
Subsequent. As a condition subsequent to the Closing,
within five (5) Trading Days following the Closing Date, the Company shall
cause to be delivered to the Purchasers evidence (reasonably satisfactory
to the Requisite Purchasers) that the outstanding amounts under the
accounts receivable line of credit provided by United Capital Funding
Corp. (“United”)
to Adamis Laboratories, Inc. (“Adamis Labs”) pursuant
to the Factoring and Security Agreement dated as of January 22, 2009 (the
“Agreement”),
by and between United and Adamis Labs (“A/R Loan”) have been
fully repaid and terminated and that the security interests on the assets
of Adamis Labs in connection therewith have been terminated, including
without limitation a copy of the executed satisfaction and release and
filed UCC-3 termination statement.
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(c)
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A/R Loan
Payoff. To the extent not previously paid, the Company
hereby authorizes and directs Gemini to pay on the Closing Date the amount
of outstanding balance on the A/R Loan as instructed by the Company in
order to payoff such A/R Loan on behalf of Adamis Labs, which amount paid
will be deducted from the amount otherwise deliverable by Gemini for its
Subscription Amount hereunder and shall constitute partial payment of its
Subscription Amount in an
amount equal to such payment.
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3
5. Expenses. The
Company shall pay a non-refundable, non-accountable sum equal to $30,000 as and
for the Purchasers’ legal fees incurred in connection with the preparation of
the Transaction Documents and consummation of the Transactions, $20,000 of which
amount has already been paid and the balance of which will be offset by Gemini
from its Subscription Amount payment. In addition, the Company shall
reimburse Gemini and the Purchasers an amount not to exceed a total of $2,500
for estimated UCC searches and filing fees and for estimated fees and expenses
incurred in connection the filing of documents with the United States Patent and
Trademark Office, which will be payable on the Closing Date out of funds
otherwise deliverable by Gemini for its Subscription Amount
hereunder.
6. Company
Address for Notices:
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Adamis
Pharmaceuticals Corporation
2658
Del Mar Heights Rd., #555
Del
Mar, CA 92014
Facsimile:
866.893.3622
Email:
adcarlo@aol.com
Contact
person: Dennis J. Carlo
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with a copy to:
Weintraub
Genshlea Chediak
400
Capitol Mall, 11th floor
Sacramento,
CA 95814
Facsimile:
(916) 446-1611
Email:
kkelso@weintraub.com
Contact
person: Kevin Kelso, Esq.
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7. Modifications
and Additional Terms.
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(a)
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Additional
Documents. In addition to the those items set forth in
Section 2.3(a)(viii) of PST Document GTC, on the Closing Date the Company
shall deliver or cause to be delivered to each Purchaser the
following:
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(i)
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a
Security Agreement, in substantially the form of Exhibit B
attached hereto, duly executed by the Company and its Subsidiaries (other
than Biosyn, Inc. (“Biosyn));
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(ii)
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a
Guarantee, in substantially the form of Exhibit C
attached hereto, duly executed by each of the Company’s Subsidiaries
(other than Biosyn);
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(iii)
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other
Security Documents in form and substance reasonably satisfactory to the
Requisite Purchasers, including without limitation any collateral
assignment of the CA License Agreement requested by the Purchasers (which
collateral assignment may be delivered by the Company at Closing with the
consent of the licensor thereof provided within ten days following the
Closing, which shall be a condition subsequent to the
Closing);
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(iv)
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irrevocable
Lock Up Agreement(s), in substantially the form of Exhibit D
attached hereto, duly executed and delivered by each of the Persons listed
on Schedule 7(a)(iv) attached hereto;
and
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(v)
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subordination
agreements, in form and substance reasonably satisfactory to the Requisite
Purchasers, executed by Dennis J. Carlo (“Carlo”) in favor of the
Purchasers, pursuant to which Carlo subordinates any and all
Indebtedness of the Company owed to him to the Indebtedness of the Company
owed to Purchasers under the
Notes.
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4
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(b)
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Modifications to PST Documents
GTC and DEF.
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(i)
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No Registration
Rights. Sections 6.1 through 6.3 of PST Document GTC are
hereby deleted such that the Purchasers shall not have any registration
rights except for the piggyback registration rights set forth in Section
6.4 thereof. Without the prior written consent of the Requisite
Purchasers, the Company shall not file any registration statement under
the Securities Act, or grant any registration rights to any Person, until
after the date which is six (6) months following the Closing Date (other
than a registration statement on Form S-4 in connection with the Merger as
contemplated in the Merger Agreement or on Form S-8 in connection with
securities issued to employees or directors pursuant to duly adopted
equity incentive plans). Notwithstanding the definition of
“Registrable Securities” contained in PST Document DEF, Registrable
Securities shall not include any Shares or Underlying Shares to the extent
such securities may be sold pursuant to Rule 144 after one (1)
year. To the extent any Registrable Securities are registered
under the Securities Act pursuant to Section 6.4 of PST Document GTC, the
Purchasers shall have the same rights and obligations as the other selling
stockholders in the Registration Statement except to the extent otherwise
provided in PST Document GTC and except that the Purchasers shall not be
entitled to the liquidated damages, if any, granted to such other selling
stockholders unless otherwise agreed by the Company. The Shares
will be treated in a manner similar to other outstanding shares of the
Company pursuant to the S-4 registration statement filed in connection
with the Merger (and will be exchanged for La Jolla Common Stock in the
same manner as such other shares) such that the shares of La Jolla Common
Stock to be issued to stockholders of the Company in connection with the
Merger and pursuant to the registration statement in exchange for shares
of Common Stock, including the Shares, shall be registered and freely
tradable upon completion of the
Merger.
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(ii)
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GTC
Sections. The following provisions of PST Document GTC
are hereby amended as follows:
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·
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In
Section 3.1(b) (Execution and
Validity), in the first sentence, between “further” and “action”
insert “corporate, partnership or
similar”.
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·
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In
Section 3.1(c) (No
Conflicts), in clause (ii) replace “the Company or any Subsidiary”
with “such Party or any of its
subsidiaries”.
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·
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In
Section 3.2(g) (Short
Sales and Confidentiality), in the phrase “provided that if the
Transactions have been publicly disclosed” insert “material terms of the”
before “Transactions”.
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·
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Sections
3.3(d) and (e) are deleted in their
entirety.
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·
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In
Section 3.4(g) (Public
Filings), in the last full line add “, in light of the totality of
the circumstances and public disclosures made,” before the words “not
misleading”.
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·
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In
Section 3.4(i) (Financial Statements),
the first sentence shall be replaced with “Since the date of the most
recent balance sheet contained in the Most Recent Fiscal Report, the
Company and its Subsidiaries have not incurred any Liabilities other than
those Liabilities incurred in the ordinary course of the Company's or its
Subsidiaries' respective businesses which Liabilities, individually or in
the aggregate, do not have, and could not reasonably be expected to result
in, a Material Adverse Effect.”
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·
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In
Section 3.4(j) (Material
Changes), in the first sentence delete “audited” and replace “most
Recent Annual Report” with “Most Recent Fiscal
Report”.
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5
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·
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In
Section 3.4(p) (Regulatory Permits),
after the word “All” at the beginning of the second sentence add
“material” before the word
“Permits”.
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·
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In
Section 3.4(r) (Intellectual Property)
(A) in the fourth sentence add “materially” before “interfered” and add
“material” before “Intellectual Property”, (B) at the end of the fifth
sentence add “except for instances that would not reasonably be expected
to cause a Material Adverse Effect”, and (C) in the penultimate sentence
add “imminent” before “new products” and after “developed” add “and ready
to be commercialized”.
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·
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In
Section 3.4(s) (Insurance), in clause
(ii) add “material” before
“breach”.
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·
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In
Section 3.4(t) (Tax
Matters), in clause (ii) add “material” before “tax
deficiency”.
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·
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In
Section 3.4(x) (Sarbanes-Oxley), after
“negative conclusions” add “required to be disclosed” in each
instance.
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·
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In
Section 3.4(y) (Internal
Accounting Controls), in clause (iii) after “authorizations” add
“and policies”.
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·
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In
Section 3.4(z) (Corporate Records),
replace the first sentence with “The minute books of the Company and each
Subsidiary contain all existing records of all meetings and actions of the
Board of Directors (and its committees) and the stockholders of the
Company and such Subsidiary, respectively, and all such records are
complete and accurate in all material
respects”.
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·
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In
Section 3.4(ii) (Disclosure), replace
“Form S-1 or From F-1” with “Form
S-3”.
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·
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In
Section 4.7 (Reporting), at the end
add “, to the extent not available on
EDGAR”.
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·
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In
Section 4.8 (Securities
Laws Disclosure), in clause (a) replace “Closing Date” with
“execution and delivery of the Securities Purchase
Agreement”.
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·
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In
Section 4.13 (No
Inconsistent Agreement), at the end add “in any material
respect”.
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·
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For
clarification, Section 4.15 (Stockholder Approval)
is not applicable for this Transaction since the Common Stock is traded on
the Bulletin Board which does not have a 20%
Rule.
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·
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In
Section 5.1 (Transfer
Restrictions), the second sentence shall be replaced with “In
connection with any transfer of Securities or Underlying Shares other than
(a) pursuant to an effective Registration Statement or Rule 144(b)(1), (b)
to the Company or to an affiliate of a Purchaser (that does not constitute
a change in beneficial ownership), or (c) in connection with a pledge as
contemplated in Section 5.3 below, the Company may require the transferor
thereof to provide the Company with a legal opinion, in form and substance
reasonably acceptable to the Company from counsel reasonably acceptable to
the Company, or other evidence reasonably satisfactory to the Company, to
the effect that such transfer does not require registration of such
transferred securities under the Securities
Act.”
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·
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In
Section 5.2(a) (Legends), “Rule 144”
shall be replaced with “Rule 144(b)(1)”, and in Section 5.2(b) (Removal of Legends),
legend removal is subject to the Holder not being an Affiliate, and any
opinion of counsel required before completion of the one year holding
period under Rule 144 may require the Holder to represent to the Company
in writing that it will sell such shares only in compliance with Rule 144
or Section 4(1) of the Securities Act if such shares are not registered
for resale under the Securities
Act.
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·
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For
clarification, to the extent the terms of the Notes are inconsistent with
Section 5.2(d) (Failure
to Deliver Shares), the terms of the Notes shall
control.
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·
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In
Section 5.4 (Rule 144
Information), in the first sentence after “As long as any Purchaser
owns Securities and/or Underlying Shares”, add “(but not more than three
years after the Closing Date)”.
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·
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For
clarification, in Section 5.5 (Reservation of
Securities), monthly Liquidated Damages shall cease to accrue upon
the Company’s redemption of Underlying Shares pursuant to the last
sentence thereof.
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·
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In
Section 7.5 (Survival), at the end
add “for four years following the Closing
Date”.
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·
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In
Section 7.12 (Notices), replace “6:00
p.m.” with “4:30 p.m.” in each
instance.
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(iii)
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DEF
Sections. The following definitions contained in PST
Document DEF are hereby amended as
follows:
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·
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“Bankruptcy Event” is
hereby amended to delete clause (f)
therefrom.
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·
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“Covenant Expiration
Date” is hereby amended to replace clause (b) thereof with “the
first anniversary of the Closing
Date”.
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·
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“Legend Removal Date” is
hereby amended to add at the end thereof “and such Purchaser is not an
Affiliate of the Company.”
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·
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“Liens” is hereby
amended to add at the end thereof “, and (f) liens created by the
Transaction Documents”.
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·
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“Material Adverse
Effect” is hereby amended to add “current” before “prospects” and
to add at the end thereof “, other than to the extent such effects are due
to (A) any change in the stock price or trading volume of the Company
Common Stock (it being understood that the facts and circumstances giving
rise to such change may be deemed to constitute, and may be taken into
account in determining whether there has been, a Material Adverse Effect),
or (B) any act or threat of terrorism or war anywhere in the world, any
armed hostilities or terrorist activities anywhere in the world, any
threat or escalation or armed hostilities or terrorist activities anywhere
in the world or any governmental or other response or reaction to any of
the foregoing.”
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·
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“Organization Documents”
is hereby amended to replace “conduct” with “internal
governance”.
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·
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“Recent
Report” is hereby amended to add at the end thereof, “, and the Form S-4
registration statement filed by La Jolla in connection with the proposed
Merger, as in effect before the Closing Date, to the extent such
registration statement includes information relating to the
Company.
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(c)
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Additional Representations and
Warranties. The
Company hereby represents and warrants to each Purchaser that, except as
disclosed in a Recent Report, as of the date hereof and as of the Closing
Date:
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(i)
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FDA. As
to each product subject to the jurisdiction of the U.S. Food and Drug
Administration (“FDA”) under the Federal
Food, Drug and Cosmetic Act, as amended, and the regulations thereunder
(“FDCA”) that is
manufactured, packaged, labeled, tested, distributed, sold, and/or
marketed by the Company or any of its Subsidiaries (each such product, a
“Pharmaceutical
Product”), such Pharmaceutical Product is being manufactured,
packaged, labeled, tested, distributed, sold and/or marketed by the
Company in compliance with all applicable requirements under FDCA and
similar laws, rules and regulations relating to registration,
investigational use, premarket clearance, licensure, or application
approval, good manufacturing practices, good laboratory practices, good
clinical practices, product listing, quotas, labeling, advertising, record
keeping and filing of reports, except where the failure to be in
compliance would not reasonably result in a Material Adverse
Effect.
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(ii)
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Indebtedness. Set
forth on Schedule 3.4(f) of the Disclosure Schedule is a list of all
Indebtedness of the Company, including the amounts outstanding with
respect to each item of Indebtedness and each Person owed such
Indebtedness. Upon the request of any Purchaser, the Company
shall furnish such Purchaser with any and all agreements and documents
related to such Indebtedness.
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(iii)
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Biosyn. The
value of each of Biosyn’s assets and Cellegy Holdings, Inc.’s (“Cellegy”) assets are not
material and are insignificant relative to the value of the Company as a
whole. So long as any Notes are outstanding, the Company shall
not transfer, or permit any Affiliate of the Company to transfer, any
significant dollar amount of assets to Biosyn or Cellegy, and the Company
shall ensure that neither Biosyn nor Cellegy engages in any operations
other than operations that are immaterial relative to the value of the
Company as a whole. So long as any Notes are outstanding, in
the event that at any time the value of Biosyn’s or Cellegy’s assets
becomes material or not insignificant relative to the value of the Company
as a whole, the Company shall promptly cause Biosyn and/or Cellegy, as the
case may be, to execute and deliver to the Purchasers (A) a Security
Agreement insubstantially the form of Exhibit B
attached hereto and (B) a Guarantee in substantially the form of Exhibit C
attached hereto.
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(iv)
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Nevagen
License. That certain license agreement (“AC License Agreement”)
dated as of July 28, 2006 between the Company’s wholly-owned Subsidiary,
Adamis Corporation (f/k/a Adamis Pharmaceuticals Corporation), as licensee
(“AC”), and
Nevagen, LLC, a Nevada corporation (“Nevagen”), as licensor,
pursuant to which AC licensed certain intellectual property from Nevagen
as set forth therein, (A) is legal, valid, binding and enforceable and in
full force and effect, and (B) has not been amended since its
execution. Neither AC nor, to the Company’s and AC’s knowledge
Nevagen, is in breach or default under the AC License Agreement and, to
the Company’s and AC’s knowledge, no event has occurred which with notice
or lapse of time or both would constitute a breach or default or permit
termination or modification of the AC License Agreement, and Adamis does
not anticipate that it will breach or become in default under the AC
License Agreement. Notwithstanding anything contained in the
Company’s Recent Reports, except as set forth on Schedule F to the
Security Agreement, the Company and its Subsidiaries do not own or have an
interest in (as licensee or otherwise) any patents, patent applications,
trademarks or trademark applications that are material to the business of
the Company and its Subsidiaries or have, or can be reasonably expected to
have, any material value. Nevagen currently owns all patents
and patent applications set forth in Schedule F to the Security Agreement
(including any patents issued for the patent applications set forth
therein).
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(d)
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Additional
Covenants.
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(i)
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Lock-Up
Agreements. The Company shall enforce the provisions of
the Lock-Up Agreements and shall place or cause to be placed “stop orders”
on its books to prevent transfer of shares of Common Stock or other
securities of the Company in violation of the Lock-Up
Agreements. The Company agrees not to take any action or allow
any act to be taken which would be inconsistent with the Lock-Up
Agreements nor amend or terminate any Lock-Up Agreement without the
consent of the Requisite
Purchasers.
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(ii)
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Subsequent Equity
Sales.
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(A)
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“Subsequent Financing”
shall mean any issuance of shares of Common Stock, Convertible Securities
or Options by the Company or any Subsidiary, other than an Exempt
Issuance.
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(B)
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From
the date hereof until such time as no Purchaser holds any of the Notes,
the Company shall be prohibited from effecting or entering into an
agreement to effect any Subsequent Financing involving a Variable Rate
Transaction, provided that this
prohibition shall not apply to the extent that the effective conversion
price, exercise price, exchange price or per share sale price (either
initially or resulting from any adjustment other than proportional
adjustments such as stock splits) is at least $0.20 and is not subject to
reduction below $0.20 (such $0.20 figure to be appropriately and equitably
adjusted for stock splits, combinations, stock dividends,
recapitalizations and the like) and shall not apply to the extent the
transaction is a Variable Rate Transaction solely because it contains
standard price-based anti-dilution
protection.
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8
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(C)
|
Without
limiting the foregoing, from the date hereof until such time as no
Purchaser holds any of the Notes, in the event the Company issues or sells
any shares of Common Stock, Convertible Securities or Options or amends
the transaction documents relating to any sale or issuance of Common
Stock, Convertible Securities or Options, other than Exempt Issuances, if
a Purchaser reasonably believes that the terms and conditions thereunder
are more favorable to such investors than the terms and conditions granted
under the Transaction Documents, upon notice to the Company by such
Purchaser the Company shall amend the terms of this Transaction and the
Transaction Documents so as to give the Purchasers the benefit of such
more favorable terms or conditions.
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|
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(D)
|
Without
limiting the foregoing, if at any time prior to the Maturity Date (as
defined in the Notes) the Company raises capital in a Subsequent
Financing, other than from a sale solely of Common Stock at an effective
per share sale price greater than the Conversion Price under the Notes
(which Common Stock sale may include up to 50% warrant coverage, provided
such warrants have (i) an exercise price greater than the Conversion
Price, (ii) a term not more than five (5) years, (iii) no cashless
exercise provision, and (iv) no price-based anti-dilution adjustment which
can cause the exercise price to fall below such Conversion Price), then
five (5) Trading Days following the closing of such Subsequent Financing
at least 50% of the gross proceeds therefrom shall be paid to the
Purchasers to redeem a portion of the Notes at a redemption price equal to
110% of the principal amount being redeemed plus all accrued but unpaid
interest thereon. Any such redemption of Notes shall be
effected on a pro rata basis based upon the then outstanding principal
amount of Notes. On or prior to any such closing the Company
shall give written notice to each Purchaser specifying the intended
closing date and the principal amount of such Purchaser’s Notes to be
redeemed. Notwithstanding anything contained herein, any
Purchaser may reject any such redemption in whole or in
part. To the extent the Company is obligated to redeem any
portion of the Notes pursuant to this Section but fails to do so, such
default shall constitute an Event of Default under the
Notes. Notwithstanding anything contained in this paragraph,
none of the La Jolla Net Cash (as defined in the Merger Agreement)
obtained in the Merger shall be required to be paid to the Purchasers to
redeem any portion of the Notes as a result of the
Merger.
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|
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(iii)
|
G-Max
Note. The Company represents, acknowledges and agrees
that (A) each holder of Notes is a third party beneficiary of the
subordination provisions under the G-Max Note (as defined in the Notes)
and the Company agrees to enforce such subordination provisions for the
benefit of the Note holders, and (B) the Indebtedness represented by the
Notes constitutes “Senior Indebtedness” under and as defined in the G-Max
Note.
|
9
|
(e)
|
Additional Closing
Conditions. The obligation of each Purchaser to purchase
the Notes from the Company at the Closing shall be subject to the
satisfaction, at or prior to the Closing, of each of the following
conditions (in addition to those provided in PST Document GTC), provided
that these conditions are for such Purchaser’s sole benefit and may be
waived by such Purchaser (as to itself only) at any time in its sole
discretion by providing the Company with prior written notice
thereof:
|
|
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(i)
|
On
or prior to the Closing Date the Company shall deliver or cause to be
delivered to each Purchaser each of the documents set forth in Section
7(a) above.
|
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(f)
|
Other Terms and
Provisions.
|
|
|
(i)
|
La Jolla
Merger. The Purchasers hereby consent to the Merger in
accordance with the terms of the Merger Agreement disclosed as an Exhibit
to the Form 8-K filed on December 7, 2009, and no further consent of the
Purchasers shall be required to effect the Merger so long as there are no
material changes to the Merger
Agreement.
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(ii)
|
Attorneys. For
reasons of administrative convenience only, the Purchasers and their
respective counsel have chosen to communicate with the Company through
Peter J. Weisman, P.C. Peter J. Weisman, P.C. does not
represent any of the Purchasers except Gemini Master Fund, Ltd., and
Weinstein Smith LLP does not represent any of the Purchasers except
Kingsbrook Opportunities Master Fund
LP.
|
[Signature Page
Follows]
10
IN
WITNESS WHEREOF, as of the date first written above, the Parties hereto have
duly executed, or caused their authorized officers to duly execute, this
Securities Purchase Agreement #ADMP-09-A with file name “SPA -- ADMP
v.6”.
COMPANY:
|
ADAMIS
PHARMACEUTICALS CORPORATION
|
||
|
By:
|
/s/
Dennis J. Carlo
|
|
|
Name:
|
Dennis
J. Carlo
|
|
|
Title:
|
CEO
|
|
PURCHASER:
1. Signature:
|
PARTNERSHIP,
CORPORATION, LIMITED LIABILITY COMPANY OR TRUST:
|
INDIVIDUAL:
|
|
|
(Print
Name of Purchaser Entity)
|
(Print
Name(s))
|
|
By:
|
|||
|
(Print
name of authorized, executing entity, if any; if none, leave
blank)
|
(Signature)
|
|
By:
|
|||
|
(Signature
of Authorized Person)
|
(Joint-Owner
Signature, if any)
|
|
(Print
Name and Title of Authorized Person)
|
2. Subscription
Amount: $______________
3. Maximum Ownership
Percentage:
The
Maximum Ownership Percentage shall be 9.9% if no box is checked
below.
|
□ 4.9%
|
□ 9.9%
|
□ Other:
______%
|
□
None
|
[Purchaser
Signature Page to Securities Purchase Agreement #ADMP-09-A P. 2/2]
Schedule
7(a)(iv)
Dennis J.
Carlo
David J.
Marguglio
Richard
L. Aloi
Robert O.
Hopkins (provided that up to an aggregate of 250,000 shares held by
Mr. Hopkins may be sold within 30 days following the Closing Date so long as no
shares are sold at a price less than $0.22 per share)
Exhibit
A
FORM OF 10% SENIOR SECURED
CONVERTIBLE NOTE
A-1
Exhibit
B
FORM OF SECURITY
AGREEMENT
B-1
Exhibit
C
FORM OF
GUARANTEE
C-1
Exhibit
D
FORM OF LOCK-UP
AGREEMENT
D-1