Exhibit 10.28
THIS NOTE AND THE COMMON SHARES ISSUABLE UPON CONVERSION OF THIS NOTE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE
SECURITIES LAWS. THIS NOTE AND THE COMMON SHARES ISSUABLE UPON CONVERSION OF
THIS NOTE MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THIS NOTE UNDER SAID ACT
AND ANY APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO INYX, INC. THAT SUCH REGISTRATION IS NOT REQUIRED.
AMENDED AND RESTATED CONVERTIBLE TERM NOTE
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FOR VALUE RECEIVED, each of INYX, INC., a Nevada corporation and INYX
PHARMA, LTD., a corporation formed under the law of England and Wales (each
collectively referred to herein as the "Borrower"), hereby jointly and severally
promise to pay to LAURUS MASTER FUND, LTD., c/o Ironshore Corporate Services
Ltd., P.O. Box 1234 G.T., Queensgate House, South Church Street, Grand Cayman,
Cayman Islands, Fax: 000-000-0000 (the "Holder") or its registered assigns or
successors in interest, on order, the sum of FIVE MILLION UNITED STATES DOLLARS
(US$5,000,000), together with any accrued and unpaid interest hereon, on October
29, 2006 (the "Maturity Date") if not sooner paid. Of such amount, $4,500,000
was advanced on October 29, 2003, and $500,000 was advanced on May 27, 2004,
when this Note was amended and restated. The prior outstanding Note is hereby
consolidated herewith, without duplication, and shall form a part of the
Borrower's obligation to Holder under this Convertible Note. The Borrower's
obligations to Holder under the that certain Secured Revolving Note dated
October 29, 2003 Note issued by the Borrower to the Holder are hereby
simultaneously with the execution and delivery of this Note by the Borrower to
the Holder irrevocably extinguished. This Amended and Restated Note amends and
restates in its entirety that certain Convertible Note of the Borrower to the
Holder dated as of October 29, 2003 in the original principal amount of Four
Million Five Hundred Thousand Dollars ($4,500,000).
Capitalized terms used herein without definition shall have the meanings
ascribed to such terms in that certain Securities Purchase Agreement dated as of
the date hereof between the Borrower and the Holder (the "Purchase Agreement").
The following terms shall apply to this Note:
ARTICLE I
INTEREST & AMORTIZATION
1.1 Interest Rate and Payment. Subject to Sections 4.10 and 5.6 hereof,
interest payable on this Note shall accrue at a rate of seven percent (7%) per
annum (the "Contract Rate"), subject to adjustment. On the last business day of
each month hereafter (each a "Determination Date"), the Contract Rate shall be
determined as follows: if (i) the Company shall have registered the shares of
the Company's common stock underlying the conversion of the Note and that
certain warrant issued to Laurus on a registration statement declared effective
by the SEC, and (ii) the volume weighted average price of the Common Stock as
reported by Bloomberg, L.P. on the principal market for the 10 trading days
immediately preceding a Determination Date exceeds the then applicable Fixed
Conversion Price in such percentages as outlined in the table below, the
Contract Rate for the succeeding calendar month shall automatically be adjusted
as follows:
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100% or less of Applicable Fixed Conversion Price Contract Rate
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125% of the applicable Fixed Conversion Price Contract Rate minus 0.25%
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150% of the applicable Fixed Conversion Price Contract Rate minus 0.50%
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175% of the applicable Fixed Conversion Price Contract Rate minus 0.75%
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Interest shall be payable monthly in arrears commencing on December 1,
2003 on the first day of each consecutive calendar month thereafter (each, a
"Repayment Date"), and on the Maturity Date, whether by acceleration or
otherwise.
1.2 Monthly Principal Payments. Amortizing payments of the aggregate
principal amount outstanding under this Note at any time (the "Principal
Amount") shall begin on March 1, 2004 and shall recur on the first calendar day
of each succeeding month thereafter until the Maturity Date (each, an
"Amortization Date"). Subject to Section 2.1 below, beginning on the first
Amortization Date, the Borrower shall make monthly payments to the Holder on
each Repayment Date, each in the sum of $140,625, plus the new amended amount of
$16,667 together with any accrued and unpaid interest to date on such portion of
the Principal Amount plus any and all other amounts which are then owing under
this Note but have not been paid (collectively, the "Monthly Amount").
ARTICLE II
BORROWER PAYMENT OPTIONS
2.1 Payment of Monthly Amount in Cash or Common Stock. (a) Subject to
the terms hereof, the Borrower shall have the sole option to determine whether
to satisfy payment of the Monthly Amount on each Repayment Date either in cash
or in shares of Common Stock (as defined in the Purchase Agreement), or a
combination of both. Each month by the tenth (10th) day of such month, the
Borrower shall deliver to the Holder a written irrevocable notice in the form of
Exhibit B attached hereto electing to pay the Monthly Amount payable on the next
Repayment Date in either cash or Common Stock, or a combination of both (each, a
"Repayment Election Notice") (the date by which such notice is required to be
given being hereinafter referred to as the "Notice Date"). If a Repayment
Election Notice is not delivered to the Holder by the applicable Notice Date for
such Repayment Date, then the Monthly Amount due on such Repayment Date shall be
paid in cash. Any portion of the Monthly Amount paid in cash on a Repayment
Date, shall be paid to the Holder an amount equal to (x) 105% of the principal
portion of the Monthly Amount plus (y) any accrued and unpaid interest in
satisfaction of such obligation If the Borrower repays all or a portion of the
Monthly Amount in shares of Common Stock, the number of such shares to be issued
for such Repayment Date shall be the number determined by dividing (x) the
portion of the Monthly Amount to be paid in shares of Common Stock, by (y) the
Fixed Conversion Price. For purposes hereof, the "Fixed Conversion Price" means
$0.80 as to $500,000 of the principal amount hereof, and $1.00 with respect to
the balance hereof.
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(b) Monthly Amount Common Stock Payment Guidelines. Subject to Sections
2.1 and 2.2 hereof, if the Borrower has elected to pay all or a portion of the
Monthly Amount due on such Repayment Date in shares of Common Stock and the
closing price of the Common Stock as reported by Bloomberg, L.P. on the
Principal Market (as defined in Section 4.7 hereof) for any of the ten (10)
trading days preceding a Repayment Date was less than 115% of the Fixed
Conversion Price, then the Borrower shall pay in cash instead. Any part of the
Monthly Amount due on such Repayment Date that the Borrower did not elect to pay
in shares of Common Stock shall be paid by the Borrower in cash on such
Repayment Date. Any part of the Monthly Amount due on such Repayment Date which
the Borrower elected to pay in shares of Common Stock but which must be paid in
cash (because the closing price of the Common Stock on one or more of the ten
(10) trading days preceding the applicable Repayment Date was less than 115% of
the Fixed Conversion Price) shall be paid within three (3) business days of the
applicable Repayment Date.
2.2 No Effective Registration. Notwithstanding anything to the contrary
herein, the Borrower shall not repay any part of its obligations to the Holder
hereunder if (i) there fails to exist an effective current Registration
Statement (as defined in the Registration Rights Agreement) covering the shares
of Common Stock to be issued in connection with such payment, or (ii) an Event
of Default hereunder exists and is continuing, unless such Event of Default is
cured within any applicable cure period or is otherwise waived in writing by the
Holder in whole or in part at the Holder's option.
2.3 Optional Prepayments in Common Stock. Subject to Section 2.2
hereof, if the average closing price of the Common Stock on the Principal Market
is greater than 115% of the Fixed Conversion Price for a period of at least five
(5) consecutive trading days, then the Borrower may, at its sole option, provide
the Holder written notice (a "Prepayment Call Notice") requiring the conversion
at the then applicable Fixed Conversion Price of all or a portion of the
outstanding principal, interest and fees outstanding under this Note (subject to
compliance with Section 2.3 and 3.2), together with accrued interest on the
amount being prepaid, as of the date set forth in such Prepayment Call Notice
(the "Prepayment Call Date"). The Prepayment Call Date shall be at least ten
(10) trading days following the date of the Prepayment Call Notice On the
Prepayment Call Date, the Borrower shall deliver to the Holder certificates
evidencing the shares of Common Stock issued in satisfaction of the principal
and interest being prepaid. Notwithstanding the foregoing, the Borrower's right
to issue shares of Common Stock in satisfaction of its obligations under this
Note shall be subject to the limitation that the number of shares of Common
Stock issued in connection with any Prepayment Call Notice shall not exceed 25%
of the aggregate dollar trading volume of the Common Stock for the ten (10)
trading days immediately preceding the Prepayment Call Date (as such volume is
reported by Bloomberg L.P.). If the price of the Common Stock falls below 115%
of the then applicable Fixed Conversion Price during the ten (10) trading day
period immediately preceding the Prepayment Call Date, then the Holder will then
be required to convert only such amount of the Note as shall equal twenty five
percent (25%) of the aggregate dollar trading volume (as such volume is reported
by Bloomberg L.P.) for each day that the Common Stock has exceeded 115% of the
then applicable Fixed Conversion Price.
The Borrower shall not be permitted to give the Holder more than one
Prepayment Call Notice under this Note during any 22-day period.
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Any principal amount of this Note which is prepaid pursuant to this
Section 2.4 shall be deemed to constitute payments of outstanding principal
applying to Monthly Amounts for the remaining Repayment Dates in chronological
order.
2.4 Optional Redemption in Cash. The Borrower will have the option of
prepaying all amounts outstanding under this Note in full ("Optional
Redemption") by paying to the Holder a sum of money equal to one hundred twenty
percent (120%) of the principal amount of this Note together with accrued but
unpaid interest thereon and any and all other sums due, accrued or payable to
the Holder arising under this Note or the Purchase Agreement or any Related
Document (as defined in the Purchase Agreement) (the "Redemption Amount")
outstanding on the day written notice of redemption (the "Notice of Redemption")
is given to the Holder, which Notice of Redemption shall specify the date for
such Optional Redemption (the "Redemption Payment Date"). A Notice of Redemption
shall not be effective with respect to any portion of this Note for which the
Holder has a pending election to convert pursuant to Section 3.1 and the
Redemption Amount shall be determined as if such election to convert had been
completed immediately prior to the date of the Notice of Redemption. The
Redemption Payment Date shall be not earlier than the day after the date of the
Notice of Redemption and not later than seven (7) days after the date of the
Notice of Redemption. On the Redemption Payment Date, the Redemption Amount must
be paid in good funds to the Holder. In the event the Borrower fails to pay the
Redemption Amount by the Redemption Payment Date, then such Redemption Notice
will be null and void.
ARTICLE III
CONVERSION RIGHTS
3.1 Holder's Conversion Rights. The Holder shall have the right, but
not the obligation, to convert all or any portion of the then aggregate
outstanding principal amount of this Note, together with interest and fees due
hereon, into shares of Common Stock subject to the terms and conditions set
forth in this Article III. The Holder may exercise such right by delivery to the
Borrower of a written notice of conversion not less than one (1) day prior to
the date upon which such conversion shall occur. The date upon which such
conversion shall occur is (the "Conversion Date").
3.2 Conversion Limitation. Notwithstanding anything contained herein to
the contrary, the Holder shall not be entitled to convert pursuant to the terms
of this Note an amount that would be convertible into that number of Conversion
Shares which would exceed the difference between the number of shares of Common
Stock beneficially owned by such Holder or issuable upon exercise of warrants
held by such Holder and 4.99% of the outstanding shares of Common Stock of the
Borrower. For the purposes of the immediately preceding sentence, beneficial
ownership shall be determined in accordance with Section 13(d) of the Exchange
Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share
limitation described in this Section 3.2 upon 75 days prior notice to the
Borrower or without any notice requirement upon an Event of Default.
3.3 Mechanics of Xxxxxx's Conversion. (a) In the event that the Holder
elects to convert this Note into Common Stock, the Holder shall give notice of
such election by delivering an executed and completed notice of conversion
("Notice of Conversion") to the Borrower and such Notice of Conversion shall
provide a breakdown in reasonable detail of the Principal Amount, accrued
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interest and fees being converted. On each Conversion Date (as hereinafter
defined) and in accordance with its Notice of Conversion, the Holder shall make
the appropriate reduction to the Principal Amount, accrued interest and fees as
entered in its records and shall provide written notice thereof to the Borrower
within two (2) business days after the Conversion Date. Each date on which a
Notice of Conversion is delivered or telecopied to the Borrower in accordance
with the provisions hereof shall be deemed a Conversion Date (the "Conversion
Date"). A form of Notice of Conversion to be employed by the Holder is annexed
hereto as Exhibit A.
(b) Pursuant to the terms of the Notice of Conversion, the Borrower
will issue instructions to the transfer agent accompanied by an opinion of
counsel within one (1) business day of the date of the delivery to Borrower of
the Notice of Conversion and shall cause the transfer agent to transmit the
certificates representing the Conversion Shares to the Holder by crediting the
account of the Holder's designated broker with the Depository Trust Corporation
("DTC") through its Deposit Withdrawal Agent Commission ("DWAC") system within
three (3) business days after receipt by the Borrower of the Notice of
Conversion (the "Delivery Date"). In the case of the exercise of the conversion
rights set forth herein the conversion privilege shall be deemed to have been
exercised and the Conversion Shares issuable upon such conversion shall be
deemed to have been issued upon the date of receipt by the Borrower of the
Notice of Conversion. The Holder shall be treated for all purposes as the record
holder of such Common Stock, unless the Holder provides the Borrower written
instructions to the contrary.
3.4 Conversion Mechanics.
(a) The number of shares of Common Stock to be issued upon each
conversion of this Note shall be determined by dividing that portion of the
principal and interest and fees to be converted, if any, by the Fixed Conversion
Price. In the event of any conversions of outstanding principal amount under
this Note in part pursuant to this Article III, such conversions shall be deemed
to constitute conversions of outstanding principal amount applying to Monthly
Amounts for the remaining Repayment Dates in chronological order. By way of
example, if the original principal amount of this Note is $4,500,000 and the
Holder converted $150,000 of such original principal amount prior to the first
Repayment Date, then (1) the principal amount of the Monthly Amount due on the
first Repayment Date would equal $0, (2) the principal amount of the Monthly
Amount due on the second Repayment Date would equal $131,250 and (3) the
principal amount of the Monthly Amount due on the third Repayment Dates would be
$140,625.
(b) The Fixed Conversion Price and number and kind of shares or other
securities to be issued upon conversion is subject to adjustment from time to
time upon the occurrence of certain events, as follows:
A. Stock Splits, Combinations and Dividends. If the shares of Common
Stock are subdivided or combined into a greater or smaller number of shares of
Common Stock, or if a dividend is paid on the Common Stock in shares of Common
Stock, the Fixed Conversion Price or the Conversion Price, as the case may be,
shall be proportionately reduced in case of subdivision of shares or stock
dividend or proportionately increased in the case of combination of shares, in
each such case by the ratio which the total number of shares of Common Stock
outstanding immediately after such event bears to the total number of shares of
Common Stock outstanding immediately prior to such event.
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B. During the period the conversion right exists, the Borrower will
reserve from its authorized and unissued Common Stock a sufficient number of
shares to provide for the issuance of Common Stock upon the full conversion of
this Note. The Borrower represents that upon issuance, such shares will be duly
and validly issued, fully paid and non-assessable. The Borrower agrees that its
issuance of this Note shall constitute full authority to its officers, agents,
and transfer agents who are charged with the duty of executing and issuing stock
certificates to execute and issue the necessary certificates for shares of
Common Stock upon the conversion of this Note.
C. Share Issuances. Subject to the provisions of this Section 3.4, if
the Borrower shall at any time prior to the conversion or repayment in full of
the Principal Amount issue any shares of Common Stock to a person other than the
Holder (except (i) pursuant to Subsections A or B above; (ii) pursuant to
options, warrants, or other obligations to issue shares outstanding on the date
hereof as disclosed to Holder in writing; or (iii) pursuant to options that may
be issued under any employee incentive stock option and/or any qualified stock
option plan adopted by the Borrower) for a consideration per share (the "Offer
Price") less than the Fixed Conversion Price in effect at the time of such
issuance, then the Fixed Conversion Price shall be immediately reset pursuant to
the formula below. For purposes hereof, the issuance of any security of the
Borrower convertible into or exercisable or exchangeable for Common Stock shall
result in an adjustment to the Fixed Conversion Price at the time of issuance of
such securities.
If the Corporation issues any additional shares pursuant to Section 3.4
above then, and thereafter successively upon each such issue, the Fixed
Conversion Price shall be adjusted by multiplying the then applicable Fixed
Conversion Price by the following fraction:
-----------------------------------
A + B
-----------------------------------
(A + B) + [((C - D) x B) / C]
-----------------------------------
A = Actual shares outstanding prior to such offering
B = Actual shares sold in the offering
C = Fixed Conversion Price
D = Offering price
3.5 Issuance of New Note. Upon any partial conversion of this Note, a
new Note containing the same date and provisions of this Note shall, at the
request of the Holder, be issued by the Borrower to the Holder for the principal
balance of this Note and interest which shall not have been converted or paid.
The Borrower will pay no costs, fees or any other consideration to the Holder
for the production and issuance of a new Note.
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ARTICLE IV
EVENTS OF DEFAULT
If an Event of Default (as defined below) occurs and is continuing, the
Borrower's rights under Sections 2.1, 2.3 and 2.4 shall immediately cease and be
of no further effect until such time as the Event of Default has been cured, or
has been waived by the Holder. Upon the occurrence and continuance of an Event
of Default beyond any applicable grace period, the Holder may make all sums of
principal, interest and other fees then remaining unpaid hereon and all other
amounts payable hereunder due and payable within five (5) days after written
notice from Holder to Borrower (each occurrence being a "Default Notice
Period"). In the event of such acceleration, the amount due and owing to the
Holder shall be 125% of the outstanding principal amount of the Note (plus
accrued and unpaid interest and fees, if any). If, with respect to any Event of
Default other than a payment default described in Section 4.1 below, within the
Default Notice Period the Borrower cures the Event of Default, the Event of
Default will be deemed to no longer exist and any rights and remedies of Holder
pertaining to such Event of Default will be of no further force or effect.
The occurrence of any of the following events is an "Event of Default":
4.1 Failure to Pay Principal, Interest or other Fees. The Borrower
fails to pay when due any installment of principal, interest or other fees
hereon in accordance herewith, or the Borrower fails to pay when due any amount
due under any other promissory note issued by Borrower.
4.2 Breach of Covenant. The Borrower breaches any material covenant or
other term or condition of this Note or the Purchase Agreement in any material
respect and such breach, if subject to cure, continues for a period of thirty
(30) days after the occurrence thereof.
4.3 Breach of Representations and Warranties. Any material
representation or warranty of the Borrower made herein, in the Purchase
Agreement, or in any Related Document (as defined in the Purchase Agreement)
shall be materially false or misleading and shall not be cured for a period of
thirty (30) days after the occurrence thereof .
4.4 Receiver or Trustee. The Borrower shall make an assignment for the
benefit of creditors, or apply for or consent to the appointment of a receiver
or trustee for it or for a substantial part of its property or business; or such
a receiver or trustee shall otherwise be appointed.
4.5 Judgments. Any money judgment, writ or similar final process shall
be entered or filed against the Borrower or any of its property or other assets
for more than $250,000, and shall remain unvacated, unbonded or unstayed for a
period of ninety (90) days.
4.6 Bankruptcy. Bankruptcy, insolvency, reorganization or liquidation
proceedings or other proceedings or relief under any bankruptcy law or any law
for the relief of debtors shall be instituted by or against the Borrower and not
dismissed within forty five (45) days.
4.7 Stop Trade. An SEC stop trade order or Principal Market trading
suspension of the Common Stock shall be in effect for 5 consecutive trading days
or 5 days during a period of 10 consecutive days, excluding in all cases a
suspension of all trading on a Principal Market, provided that the Borrower
shall not have been able to cure such trading suspension within 30 days of the
notice thereof or list the Common Stock on another Principal Market within 60
days of such notice. The "Principal Market" for the Common Stock shall include
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the NASD OTC Bulletin Board, NASDAQ SmallCap Market, NASDAQ National Market
System, American Stock Exchange, or New York Stock Exchange (whichever of the
foregoing is at the time the principal trading exchange or market for the Common
Stock, or any securities exchange or other securities market on which the Common
Stock is then being listed or traded.
4.8 Failure to Deliver Common Stock or Replacement Note. The Borrower's
failure to timely deliver Common Stock to the Holder pursuant to and in the form
required by this Note, and Section 9 of the Securities Purchase Agreement, or if
required, a replacement Note if such failure to timely deliver Common Stock
shall not be cured within two (2) days or such failure to deliver a replacement
Note is not cured within seven (7) Business Days.
4.9 Default under the Related Agreements. If any material Event of
Default shall have occurred and be continuing under the Related Agreements, and
such Event of Default shall not be cured within three (3) business days.
DEFAULT RELATED PROVISIONS
4.10 Payment Grace Period. Notwithstanding that the Borrower shall have
a five (5) business day grace period to pay any monetary amounts due under this
Note or the Purchase Agreement or any Related Document, a default interest rate
of five percent (5%) per annum above the then applicable Contract Rate shall
apply to the monetary amounts due which such additional interest shall accrue
from the actual date such payments were due and payable.
4.11 Conversion Privileges. The conversion privileges set forth in Article III
shall remain in full force and effect immediately from the date hereof and until
this Note is paid in full.
ARTICLE V
MISCELLANEOUS
5.1 Failure or Indulgence Not Waiver. No failure or delay on the part
of the Holder hereof in the exercise of any power, right or privilege hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such power, right or privilege preclude other or further exercise thereof or
of any other right, power or privilege. All rights and remedies existing
hereunder are cumulative to, and not exclusive of, any rights or remedies
otherwise available.
5.2 Tax. Gross Up. The Borrower shall make all payments to be made by
it under this Note without any Tax Deduction unless a Tax Deduction is required
by law. The Borrower shall promptly upon becoming aware that it must make a Tax
Deduction (or that there is any change in the rate or the basis of a Tax
Deduction) notify the Holder accordingly. If a Tax Deduction is required by law
to be made by the Borrower the amount of the payment due from the Borrower under
this Note shall be increased to an amount which (after making any Tax Deduction)
leaves an amount equal to the payment which would have been due under this Note
if no Tax Deduction had been required. If the Borrower is required to make a Tax
Deduction, it shall make that Tax Deduction and any payment required in
connection with that Tax Deduction within the time allowed and in the minimum
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amount required by law. Within thirty days of making either a Tax Deduction or
any payment required in connection with that Tax Deduction, the Borrower shall
deliver to the Holder evidence reasonably satisfactory to Holder that the Tax
Deduction has been made or (as applicable) any appropriate payment paid to the
relevant taxing authority.
5.3 Tax Indemnity. The Borrower shall (within three business days of
demand by the Holder) pay to the Borrower an amount equal to the loss, liability
or cost which the Holder determines will be or has been (directly or indirectly)
suffered for or on account of any Tax by the Holder in respect of this Note,
except:
(i) for any Tax assessed on the Holder under the law of (a) the
jurisdiction in which it is incorporated or, (b) the
jurisdiction (or jurisdictions) in which the Holder is treated
as resident for tax purposes; or (c) (in respect of amounts
received or receivable in this jurisdiction) the jurisdiction
in which any branch office of the Holder is located; if that
Tax is imposed on or calculated by reference to the net income
received or receivable (but not any sum deemed to be received
or receivable) by the Holder; and
(ii) to the extent a loss, liability or cost is compensated for by
an increased payment under Section 5.2; and
(iii) if the Borrower makes any Tax Payment and the Holder
determines that: (X) a Tax Credit is attributable either to an
increased payment of which that Tax Payment forms part, or to
that Tax Payment; and (Y) the Holder has obtained, utilized
and retained that Tax Credit, and (Z) the Holder shall pay an
amount to the Borrower which the Holder determines will leave
it (after that payment) in the same after-Tax position as it
would have been in had the Tax Payment not been required to be
made by the Borrower.
For the purposes of Sections 5.2 and 5.3: "Tax" means any tax, levy,
impost, duty or other charge or withholding of a similar nature (including any
penalty or interest payable in connection with any failure to pay or any delay
in paying any of the same); (ii) "Tax Deduction" means any deduction or
withholding for or on account of any Tax; (iii) "Tax Payment" means an increase
in a payment made by the Borrower in accordance with Section 5.2 and/or Section
5.3 hereof; and (iv) "Tax Credit" means a credit against, relief or remission
for, or payment of, any Tax.
5.4 Notices. Any notice herein required or permitted to be given shall
be in writing and shall be deemed effectively given: (a) upon personal delivery
to the party notified, (b) when sent by confirmed telex or facsimile if sent
during normal business hours of the recipient, if not, then on the next business
day, (c) five days after having been sent by registered or certified mail,
return receipt requested, postage prepaid, or (d) one day after deposit with a
internationally recognized overnight courier, specifying next day delivery, with
written verification of receipt. All communications shall be sent to the
Borrower at the address provided in the Purchase Agreement executed in
connection herewith, and to the Holder at the address provided in the Purchase
Agreement for such Holder, with a copy to Xxxx X. Xxxxxx, Esq., 000 Xxxxx
Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, facsimile number (000) 000-0000,
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or at such other address as the Borrower or the Holder may designate by ten days
advance written notice to the other parties hereto. A Notice of Conversion shall
be deemed given when made to the Borrower pursuant to the Purchase Agreement.
5.5 Amendment Provision. The term "Note" and all reference thereto, as
used throughout this instrument, shall mean this instrument as originally
executed, or if later amended or supplemented, then as so amended or
supplemented, and any successor instrument issued pursuant to Section 3.3
hereof, as it may be amended or supplemented.
5.6 Assignability. This Note shall be binding upon the Borrower and its
successors and assigns, and shall inure to the benefit of the Holder and its
successors and assigns, and may be assigned by the Holder in accordance with the
requirements of the Purchase Agreement.
5.7 Governing Law. This Note shall be governed by and construed in
accordance with the laws of the State of New York, without regard to principles
of conflicts of laws. Any action brought by either party against the other
concerning the transactions contemplated by this Agreement shall be brought only
in the state courts of New York or in the federal courts located in the state of
New York. Both parties and the individual signing this Note on behalf of the
Borrower agree to submit to the jurisdiction of such courts. The prevailing
party shall be entitled to recover from the other party its reasonable
attorney's fees and costs. In the event that any provision of this Note is
invalid or unenforceable under any applicable statute or rule of law, then such
provision shall be deemed inoperative to the extent that it may conflict
therewith and shall be deemed modified to conform with such statute or rule of
law. Any such provision which may prove invalid or unenforceable under any law
shall not affect the validity or unenforceability of any other provision of this
Note.
5.8 Maximum Payments. Nothing contained herein shall be deemed to
establish or require the payment of a rate of interest or other charges in
excess of the maximum permitted by applicable law. In the event that the rate of
interest required to be paid or other charges hereunder exceed the maximum
permitted by such law, any payments in excess of such maximum shall be credited
against amounts owed by the Borrower to the Holder and thus refunded to the
Borrower.
5.9 Security Interest. The holder of this Note has been granted a
security interest in certain assets of the Borrower more fully described in a
set of security documents governed by the law of England and Wales, each dated
as of October 29, 2003 and forms of which are attached hereto as Exhibit C.
5.10 Construction. Each party acknowledges that its legal counsel
participated in the preparation of this Note and, therefore, stipulates that the
rule of construction that ambiguities are to be resolved against the drafting
party shall not be applied in the interpretation of this Note to favor any party
against the other.
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IN WITNESS WHEREOF, each Borrower has caused this Convertible Term Note
to be signed in its name effective as of this 27th of May, 2004.
INYX, INC.
By:________________________________
Name:______________________________
Title:_____________________________
INYX PHARMA, LTD.
By:________________________________
Name:______________________________
Title:_____________________________
WITNESS:
____________________________
11
EXHIBIT A
NOTICE OF CONVERSION
(To be executed by the Holder in order to convert all or part of the Note into
Common Stock
[Name and Address of Holder]
The Undersigned hereby elects to convert $_________ of the principal due on
[specify applicable Repayment Date] under the Amended and Restated Convertible
Term Note issued by INYX, INC. dated May 27, 2004 by delivery of Shares of
Common Stock of INYX, INC. on and subject to the conditions set forth in Article
II of such Note.
1. Date of Conversion _______________________
2. Shares To Be Delivered: _______________________
Date:____________
By:_______________________________
Name:_____________________________
Title:____________________________
EXHIBIT B
REPAYMENT ELECTION NOTICE
(To be executed by the Borrower in order to pay all or part of a Monthly Amount
with Common Stock)
[Name and Address of Holder]
INYX, INC. hereby elects to pay $_________ of the Monthly Amount due on [specify
applicable Repayment Date] under the Amended and Restated Convertible Term Note
issued by INYX, INC. dated May 27, 2004 by delivery of Shares of Common Stock of
INYX, INC. on and subject to the conditions set forth in Article II of such
Note.
1. Fixed Conversion Price: $_______________________
2. Amount to be paid: $_______________________
3. Shares To Be Delivered (2 divided by 1): __________________
Date: ____________ INYX, INC.
By:_______________________________
Name:_____________________________
Title:____________________________
