AMENDMENT TO SECURITIES PURCHASE AGREEMENT
Exhibit
10.1
AMENDMENT
TO SECURITIES PURCHASE AGREEMENT
This
Amendment to Securities Purchase Agreement (hereinafter referred to as this
“Amendment”)
dated
as of November 30, 2006, is entered into by
and
among NEOPROBE CORPORATION (the “Company”),
a
Delaware corporation,
BIOMEDICAL
VALUE FUND, L.P.
(“BVF”),
a
Delaware limited partnership, BIOMEDICAL
OFFSHORE VALUE FUND, LTD.
(“BOVF”
and
together with “BVF,”
the
“BV
Funds”),
an
exempted company incorporated under the provisions of the Companies Law of
the
Cayman Islands, and XXXXX X. XXXX (“Xxxx”
and
together with the BV Funds, each a “Purchaser”
and
collectively, the “Purchasers”).
W
I T N E
S S E T H :
WHEREAS,
the Company and the Purchasers are parties to that certain Securities Purchase
Agreement dated as of December 13, 2004 (hereinafter referred to as the
“Purchase
Agreement”);
and
WHEREAS,
the Purchasers and the Company desire to amend the Purchase Agreement in
accordance with the terms and conditions of this Amendment.
NOW,
THEREFORE, in consideration of the premises, the mutual covenants hereinafter
contained, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as
follows:
Section
1.
Definitions.
Terms
defined in the Purchase Agreement which are used herein shall have the same
meaning as set forth in the Purchase Agreement unless otherwise specified
herein.
Section
2.
Effect
of this Amendment.
This
Amendment shall not change, modify, amend or revise the terms, conditions and
provisions of the Purchase Agreement or the Security Agreement, the terms and
provisions of which are incorporated herein by reference, except as expressly
provided herein or in the replacement Notes and Warrants executed in connection
herewith and agreed upon by the parties hereto. This Amendment is not intended
to be nor shall it constitute a novation or accord and satisfaction of the
outstanding Obligations. The Company and the Purchasers agree that, except
as
expressly provided herein or in other documents executed in connection herewith,
all terms and conditions of the Purchase Agreement and Security Agreement shall
remain and continue in full force and effect. The Company acknowledges and
agrees that the indebtedness under the Purchase Agreement and Notes remains
outstanding and is not extinguished, paid, or retired by this Amendment, or
any
other agreements between the parties hereto prior to the date hereof, and that
the Company is and continues to be fully liable for all Obligations contemplated
by or arising out of the Purchase Agreement, Security Agreement, Notes and
Warrants, as amended or replaced pursuant to this Amendment.
Section
3.
Amendment
of Purchase Agreement.
3.1 The
following definitions appearing in Section 1 of the Purchase Agreement are
amended and replaced (except as to the definition of “Asset Disposition”, for
which only the first sentence thereof is amended and replaced) to read as
follows:
“Asset
Disposition”
shall
mean the disposition, whether by sale, lease, transfer, loss, damage,
destruction, condemnation or otherwise, of any or all of the assets of the
Company or any of its Subsidiaries other than sales of inventory in the ordinary
course of business.
“BOVF
Note”
shall
mean the replacement senior secured convertible promissory note issued to BOVF
pursuant to the Amendment in the principal amount of $3,600,000, substantially
in the form attached to the Amendment as Exhibit
A.
“BOVF
Warrant” shall
mean the replacement warrant issued to BOVF pursuant to the Amendment,
substantially in the form attached to the Amendment as Exhibit
B.
“Xxxx
Note”
shall
mean the replacement senior secured convertible promissory note issued to Xxxx
pursuant to the Amendment in the principal amount of $100,000, substantially
in
the form attached to the Amendment as Exhibit
A.
“XXXX
Warrant”
shall
mean the replacement warrant issued to Xxxx pursuant to the Amendment,
substantially in the form attached to the Amendment as Exhibit
B.
“BVF
Note”
shall
mean the replacement senior secured convertible promissory note in the principal
amount of $4,400,000 substantially in the form attached to the Amendment as
Exhibit
A.
“BVF
Warrant” shall
mean the replacement warrant issued to BVF pursuant to the Amendment,
substantially in the form attached to the Amendment as Exhibit
B.
3.2 The
following Section 8.8 is hereby added to the Purchase Agreement:
8.8 Sale
of Additional Equity Securities.
The
Company agrees (i) to use its reasonable best efforts to commence on or before
April 31, 2007, and continue during the balance of the term of the Notes, the
offering and sale of its equity securities with aggregate gross proceeds during
such period of up to $10,000,000 (an “Equity
Sale”),
and
(ii) to apply not less than 50% of the Equity Proceeds to repayment of the
principal balance of the Notes. For this purpose, “Equity
Proceeds”
means
the actual cash proceeds received by the Company from any Equity Sale, net
of
all costs incurred by the Company in connection with the offering and sale
of
the securities, including without limitation all commissions and placement
agent
fees and expense reimbursements, registration, listing and qualifications fees,
printers and accounting fees, and fees and disbursements of Company
counsel.
3.3 Section
9.6 of the Purchase Agreement is amended and replaced to read as follows:
9.6 Dispositions
of Assets.
Except
as provided in Section 9.6(a), (b), (c), or (d) the Company will not, and will
not permit any of its Subsidiaries, directly or indirectly, to (i) convey,
sell
(pursuant to a sale/leaseback or otherwise), lease, sublease, transfer or
otherwise dispose of, or grant any Person an option to acquire, in one
transaction or a series of transactions, any material amount of its property,
business or assets, or the capital stock of or other equity interests in any
of
its Subsidiaries, whether now owned or hereafter acquired, or (ii) enter into
any license, assignment, sharing or other transfer of Intellectual Property
of
the Company or Subsidiaries, or rights therein, whether through cooperative
research and development agreements, strategic alliances, agreements providing
for the manufacturing, distribution or sale of products or services of the
Company or Subsidiaries, or otherwise (a “Partnering
Transaction”):
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(a) Bona
fide
sales of inventory, including, without limitation, real estate acquired in
the
ordinary course of business, to customers for fair value in the ordinary course
of business and dispositions of obsolete equipment not used or useful in the
business;
(b) Asset
Dispositions if all of the following conditions are met:
(i) the
market value of assets sold or otherwise disposed of (by the Company and its
Subsidiaries taken as a whole) in any fiscal year do not exceed $500,000;
(ii) the
Net
Proceeds received is at least equal to the fair market value of such assets;
(iii) at
least
75% of the consideration received is cash;
(iv) not
less
than 50% of the Net Proceeds are applied to repayment of the principal balance
of the Notes;
(v) the
assets disposed of in the Asset Disposition are not subject to a security
interest pursuant to the Security Agreement; and
(vi) no
Event
of Default then exists or shall result from such sale or other
disposition.
(c) Partnering
Transactions if all of the following conditions are met:
(i) at
least
50% of the consideration received is cash;
(ii) not
less
than 50% of the Partnering Proceeds are applied to repayment of the principal
balance of the Notes. For this purpose, “Partnering
Proceeds”
means
the proceeds thereof to the Company (inclusive of cash and the fair market
value
of any property received as consideration for such Partnering Transaction),
net
of all costs incurred by the Company in connection with or pursuant to the
Partnering Transaction, including without limitation all transaction fees and
expenses of the Company, license fees or royalty payments required to be paid
to
third parties from proceeds, recording and transfer fees, accounting fees,
and
fees and disbursements of Company counsel; and
(iii) the
assets subject to the Partnering Transaction are not subject to a security
interest pursuant to the Security Agreement; and
(iv) no
Event
of Default then exists or shall result from such Partnering
Transaction.
(d)
Partnering Transactions with contract manufacturers to effect the outsourcing
of
formulation or manufacturing of products of the Company or Subsidiaries, where
any associated license of Intellectual Property to the contract manufacturer
is
limited to those rights necessary to the formulation or manufacture of products
for the sole benefit of the Company.
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3.4 Section
9.8 of the Purchase Agreement is hereby deleted.
Section
4.
Representations
and Warranties of the Company.
The
Company hereby represents and warrants, in addition to any other representations
and warranties contained in the Purchase Agreement, as follows:
(a) This
Amendment constitutes a legal, valid and binding obligation of the Company
enforceable in accordance with its terms, except as enforceability may be
limited by applicable bankruptcy, insolvency, or similar laws affecting the
enforcement of creditors’ rights generally or by equitable principles relating
to enforceability;
(b) The
Company has taken all necessary and appropriate corporate action for the
approval of this Amendment and the authorization of the execution, delivery
and
performance hereof, and the execution and delivery of the BOVF Note, the BOVF
Warrant, the Xxxx Note, the Xxxx Warrant, the BVF Note and the BVF Warrant;
and
(c) As
of the
date hereof and after giving effect to the amendments to the Purchase Agreement
contained herein, there is no Event of Default under the Purchase Agreement
or
the Notes.
Section
5.
Representations
and Warranties of the Purchasers.
Each
Purchaser, severally but not jointly, hereby represents and warrants, in
addition to any other representations and warranties contained in the Purchase
Agreement, as follows:
(a) This
Amendment constitutes a legal, valid and binding obligation of the Purchaser
enforceable in accordance with its terms, except as enforceability may be
limited by applicable bankruptcy, insolvency, or similar laws affecting the
enforcement of creditors’ rights generally or by equitable principles relating
to enforceability;
(b) The
Purchaser has taken all necessary and appropriate corporate action for the
approval of this Amendment and the authorization of the execution, delivery
and
performance hereof, and the exchange of the replacement Notes and Warrants
for
the Notes and Warrants currently outstanding.
Section
6.
Closing.
The
closing of the transactions contemplated by this Amendment, including the
exchange of the replacement Notes and Warrants for the currently outstanding
Notes and Warrants, shall occur promptly following the execution and delivery
of
this Amendment by the parties, which may be effected as provided in Section
11.5
of the Agreement. Notwithstanding Section 11.5 of the Agreement, the Company
shall deliver by overnight delivery to each of the Purchasers the replacement
Notes and Warrants to the Purchasers, against surrender by the Purchasers to
the
Company by overnight delivery of the outstanding Notes and Warrants, and the
closing shall be deemed complete upon completion of all such
deliveries.
Section
7.
Governing
Law.
This
Amendment has been executed and delivered and is intended to be performed in
the
State of New York and shall be governed, construed and enforced in all respects
in accordance with the substantive laws of the State of New York, except to
the
extent that the General Corporation Law of Delaware shall apply.
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Section
8.
Headings.
The
section headings used in this Amendment are for convenience only and shall
not
be read or construed as limiting the substance or generality of this
Amendment.
Section
9.
Amendment
Expenses.
The
Company shall pay or reimburse, promptly on demand, all costs and expenses
incurred by the Purchasers in connection with this Amendment, including without
limitation attorneys’ fees and disbursements.
[REMAINDER
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IN
WITNESS WHEREOF, the
parties hereto have caused this Amendment to be executed by their respective
duly authorized representatives as of the date and year first written
above.
| NEOPROBE CORPORATION | ||
| |
|
|
| By: | /s/ Xxxxx X. Xxxxxx | |
|
Name: Xxxxx X. Xxxxxx |
||
|
Title:
VP Finance/ CFO
|
||
| BIOMEDICAL VALUE FUND, L.P. | ||
| |
By: |
GREAT
POINT GP, LLC,
its general partner |
| By: | /s/ Xxxxx Xxxxx | |
|
Name: Xxxxx Xxxxx |
||
|
Title:
Managing Director
|
||
| BIOMEDICAL OFFSHORE VALUE FUND, LTD. | ||
| |
By: |
GREAT POINT PARTNERS, LLC, its investment manager |
| By: | /s/ Xxxxx Xxxxx | |
|
Name: Xxxxx Xxxxx |
||
| Title: Managing Director | ||
| XXXXX X. XXXX | ||
| |
|
|
| By: | /s/ Xxxxx X. Xxxx | |
|
|
||
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