Amendment to Initial Agreement. Upon the occurrence of the Amendment Effective Date (as defined below), the following amendments are hereby made to the Initial Agreement, with full force and effect as of the Amendment Effective Date:
Amendment to Initial Agreement a. Clause 1a will be deleted and replaced with: “Conversion of the Principal Amount. Subject to the terms and conditions hereof, at the Closing (as defined below), Lender hereby elects to convert the Principal Amount into (i) that number of shares of Common Stock equal to dividing the Principal Amount by an amount equal to the offering price of the Common Stock in the IPO discounted by 15% (the “Conversion Common Shares”), rounding up for fractional shares, in a number of Conversion Shares up to 19.9% of the Company’s outstanding Common Stock after giving effect of the IPO; (ii) the Company will make a milestone payment of $10 million to Knight if, after the date of a Qualifying IPO, the Company sells ARAKODA or if a Change of Control (as per the definition included in the original loan agreement dated on December 10th, 2015) occurs, provided that the purchaser of ARAKODA or individual or entity gaining control of the Borrower is not the Lender or an affiliate of the Lender; (iii) following the License and Supply agreement dated on December 10th, 2015 and subsequently amended on January 21st, 2019, an expansion of existing distribution rights to Tafenoquine/Arakoda to include COVID-19 indications as well as malaria prevention across the Territory as defined in said documents, subject to US Army approval; and (iv) Company will retain Lender or an affiliate to provide financial consulting services, management, strategic and/or regulatory advice of value $30,000 per month for five years (the parties will negotiate the terms of that consulting agreement separately in good faith).
Amendment to Initial Agreement a. Clause 1b will be deleted and replaced with” “Conversion of the Accrued Interest. Subject to the terms and conditions hereof, at the Closing (as defined below), Lender hereby elects to convert the Accrued Interest into that number of shares (the “Conversion Preferred Shares” and, together with the Conversion Common Shares, the “Conversion Shares”) of a new class of preferred stock (the “Preferred Stock”) by dividing the Accrued Interest by [$100.00], then rounding up. The Preferred Stock shall have the following rights, preferences, and designations: (i) have a 6% [cumulative] dividend accumulated annually on March 31, (ii) shall be nonvoting stock; and (iii) be convertible in shares of Common Stock at a price equal to the lower of (1) the price paid for the shares of Common Stock in the IPO and (2) the 10 day volume weighted average share price immediately preceding the Company’s election to convert the Preferred Stock. Notwithstanding the foregoing, the Company shall not convert the Preferred Stock into shares of Common Stock if as a result of such conversion Lender will own 19.9% or more of the Company’s outstanding Common Stock.”
Amendment to Initial Agreement. Section 2(c) to the Initial Agreement is hereby amended by deleting such section in its entirety and inserting in its place the following:
Amendment to Initial Agreement. Section 2(a) of the Initial Agreement is hereby amended by deleting the reference to “April 15, 2011” and inserting “June 30, 2011” in its place.
