Exhibit 10.37
CONVERSION AGREEMENT
Agreement Dated May 23, 1996 ("Agreement") between Titan
Pharmaceuticals, Inc. ("Titan") and Ingenex, Inc. ("Ingenex")
WHEREAS, at Xxxxx 00, 0000, Xxxxxxx had a total of $3,904,619 of
outstanding indebtedness owed to Titan which amount has increased to date; and
WHEREAS, it is the intention of the parties that Titan will continue to
provide loans to Ingenex in the ensuing months in order to enable Ingenex to
meet its operating requirements; and
WHEREAS, Ingenex and Titan believe it is their mutual best interests to
provide for the conversion to equity of Ingenex, debt to Titan.
WHEREAS, pursuant to a Conversion Agreement dated December 4, 1995,
Ingenex has agreed to a 9% per annum interest rate on all indebtedness, and
has granted Titan the right to convert up to an aggregate of $1,400,000 of
indebtedness, inclusive of accrued interest, into shares of common stock of
Ingenex.
NOW THEREFORE, in consideration of the foregoing and the mutual promises
and covenants herein contained, and in addition to the terms of the Conversion
Agreement dated December 4, 1995, it is hereby agreed as follows:
1. CONVERSION OF DEBT
(A) At any time from and after the date hereof until 5:00 p.m.
Pacific time on July 3, 1996 (the "Expiration Date"), Titan shall have the
right, but not the obligation, to convert up to an aggregate of $4,000,000 of
indebtedness, inclusive of accrued interest (the "Titan Debt"), into shares of
common stock, $.001 par value, of Ingenex ("Ingenex Common Stock") at a
conversion rate of $5.50 per share. The date of such conversion shall be
referred to as the "Conversion Date - 2".
(B) In the event that Ingenex consummated on or prior to the
Expiration Date an initial public offering of its securities which includes
the sale of warrants to purchase Ingenex Common Stock, for each $5.50 of
indebtedness actually converted, Titan shall have the right to purchase for
$0.10, a five-year warrant to purchase one share of Ingenex Common Stock at
$6.60 per share.
(C) From and after the Conversion Date - 2, Ingenex shall have no
further obligation with respect to the Titan Debt; provided, however, that the
foregoing will no way
affect Ingenex' obligation to repay indebtedness to Titan incurred above and
beyond the Titan Debt
IN WITNESS WHEREOF, the parties have executed this Agreement to be
effective as of the date above written.
INGENEX, INC.
By:/s/ Xxxx Xxxxx
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Xxxx Xxxxx, President
TITAN PHARMACEUTICALS, INC.
By:/s/ Xxxxx X. Xxxxxx
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Xxxxx X. Xxxxxx, President
