EXCHANGE AGREEMENT
This
Exchange
Agreement (the “Agreement”) is dated as of
January 21, 2011, by and between Radient Pharmaceuticals Corporation, a Delaware
corporation (the “Company”), and Xxxxxx Bay
Master Fund Ltd. (formerly Xxxxxx
Bay Overseas Fund, Ltd.) (the “Holder”).
Whereas,
the Holder holds a Convertible Promissory Note (the “Note”) in the original
principal amount of $108,947.00 that was purchased and issued on April 8, 2010,
pursuant to that certain Note and Warrant Purchase Agreement, dated as of April
8, 2010, by and among the Company, the Holder and the other parties
thereto;
Whereas,
the Note is convertible into shares of the Company’s common stock, $0.001 par
value per share (the “Common
Stock”), pursuant to the terms thereof; and
Whereas,
the Company desires that the Holder exchange its Note on the terms set forth
herein.
Now,
Therefore, In Consideration of the mutual covenants contained in this
Agreement, the Company and the Holder agree as follows:
1. Exchange. Simultaneously
with the execution and delivery of this Agreement, the Holder shall exchange its
Note with the Company for, and in exchange therefor the Company shall issue to
the Holder, 718,490 unlegended and freely tradable shares of Common Stock (such
718,490 shares of Common Stock are referred to herein as the “Shares”). It is expressly
understood and agreed that the exchange of the Note for the Shares to be issued
by the Company simultaneously therewith is being undertaken pursuant to Section
3(a)(9) of the Securities Act of 1933, as amended. The Company shall not issue
any stop-transfer order, instruction or other restriction with respect to any of
the Shares.
(a) Delivery of Note. The Holder
shall, within two (2) business days after the date hereof, deliver the Note to
the address specified by the Company.
(b) Delivery of Shares. The
Company shall, within one (1) business day of the date first written above,
credit the number of Shares to the balance account with The Depository Trust
Company specified by the Holder through its Deposit/Withdrawal at Custodian
system.
2. Representations
and Warranties. The Company represents and warrants to the
Holder that:
(a) The
offer and issuance of the Shares is and will be exempt from registration under
the Securities Act of 1933, as amended, pursuant to the exemption provided by
Section 3(a)(9) thereof. As a result of the foregoing, the Shares shall be
immediately freely tradable by the Holder.
(b) The
Company has the requisite power and authority to enter into and perform its
obligations under this Agreement and to issue the Shares in accordance with the
terms hereof. The execution and delivery of this Agreement by the Company, and
the consummation by the Company of the transactions contemplated hereby
(including, without limitation, the issuance of the Shares), have been duly
authorized by the Company’s board of directors, and no further filing, consent
or authorization is required by the Company, its board of directors or any of
its shareholders. This Agreement has been duly executed and delivered by the
Company, and constitutes the legal, valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms, except as such
enforceability may be limited by general principles of equity or applicable
bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws
relating to, or affecting generally, the enforcement of applicable creditors’
rights and remedies. The execution, delivery and performance by the Company of
this Agreement and the offer and issuance of the Shares requires no consent of,
action by or in respect of, or filing with, any person or entity, governmental
body, agency, or official.
(c) The
issuance of the Shares is duly authorized and, upon issuance in accordance with
the terms hereof, the Shares will be validly issued, fully paid and
non-assessable and free from all preemptive or similar rights, taxes, liens,
charges and other encumbrances with respect to the issue thereof.
(d) The
execution, delivery and performance of this Agreement by the Company and the
consummation by the Company of the transactions contemplated hereby will not (i)
result in a violation of the certificate of incorporation or other
organizational documents of the Company or any of its subsidiaries, any capital
stock of the Company, or bylaws of the Company, (ii) conflict with, or
constitute a default (or an event which with notice or lapse of time or both
would become a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any agreement, indenture or
instrument to which the Company or any of its Subsidiaries is a party, or (iii)
result in a violation of any law, rule, regulation, order, judgment or decree
(including, without limitation, federal and state securities laws and
regulations and the rules and regulations of the NYSE Amex) applicable to the
Company or any of its subsidiaries or by which any property or asset of the
Company or any of its subsidiaries is bound or affected except, in the case of
clause (ii) or (iii) above, to the extent such violations could not reasonably
be expected to have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
(e) The
Company and its board of directors have taken all necessary action, if any, in
order to render inapplicable any control share acquisition, interested
stockholder, business combination, poison pill (including any distribution under
a rights agreement) or other similar anti-takeover provision under its
certificate of incorporation, bylaws or other organizational documents or the
laws of the jurisdiction of its incorporation or otherwise which is or could
become applicable to the Holder as a result of the transactions contemplated by
this Agreement (including, without limitation, the Company’s issuance of the
Shares and the Holder’s ownership of the Shares).
3. Entire Agreement;
Construction.
This Agreement supersedes all other prior oral or written agreements between the
Holder, the Company, their affiliates and persons and entities acting on their
behalf solely with respect to the matters contained herein, and this Agreement
contains the entire understanding of the parties solely with respect to the
matters covered herein. The language used in this Agreement will be deemed to be
the language chosen by the parties to express their mutual intent, and no rules
of strict construction will be applied against any party.
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4. Governing
Law. All
questions concerning the construction, validity, enforcement and interpretation
of this Agreement shall be governed by the internal laws of the State of
Illinois, without giving effect to any choice of law or conflict of law
provision or rule (whether of the State of Illinois or any other jurisdictions)
that would cause the application of the laws of any jurisdictions other than the
State of Illinois. Each party hereby irrevocably submits to the exclusive
jurisdiction of the state and federal courts sitting in Chicago, Illinois, for
the adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that
such suit, action or proceeding is brought in an inconvenient forum or that the
venue of such suit, action or proceeding is improper. Each party hereby
irrevocably waives personal service of process and consents to process being
served in any such suit, action or proceeding by mailing a copy thereof to such
party at the address for such notices to it under this Agreement and agrees that
such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law. EACH PARTY HEREBY IRREVOCABLY WAIVES
ANY RIGHT IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE
ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF
THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.
5. Counterparts. This Agreement may be
executed in two or more identical counterparts, all of which shall be considered
one and the same agreement and shall become effective when counterparts have
been signed by each party and delivered to the other party. In the event that
any signature is delivered by facsimile transmission or by an e-mail which
contains a portable document format (.pdf) file of an executed signature page,
such signature page shall create a valid and binding obligation of the party
executing (or on whose behalf such signature is executed) with the same force
and effect as if such signature page were an original thereof.
6. Disclosure. The Company shall, on or
before 8:30 a.m., New York time, on the first (1st)
business day after the date hereof file a Current Report on Form 8-K describing
all the material terms of the transactions contemplated by this Agreement in the
form required by the Securities Exchange Act of 1934, as amended. The Company
shall promptly secure the listing of all of the Shares upon each national
securities exchange upon which the Common Stock is listed as of the date hereof
if not already so listed.
7. Dismissal.
Each of the Company and the Holder shall cause their respective attorneys to
execute and file, within two (2) business days after the date hereof, an order
dismissing with prejudice that certain litigation in the Circuit Court of Xxxx
County, Illinois, County Department, Law Division, captioned Xxxxxx Bay Fund, LP
and Xxxxxx Bay Overseas Fund, Ltd. v. Radient Pharmaceuticals Corporation, Case
No. 10-L-007108.
[signature page
follows]
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In Witness
Whereof, the parties hereto have caused this Agreement to be duly
executed by their respective authorized signatories as of the date first
indicated above.
RADIENT PHARMACEUTICALS
CORPORATION
By:_________________________
Its:_________________________
XXXXXX
BAY MASTER FUND LTD.
(Formerly
Xxxxxx Bay Overseas Fund, Ltd.)
By:_________________________
Its:_________________________
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