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CUSIP No. 28226B 302
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SCHEDULE 13D
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Page
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Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer.
Iroko Properties acquired the Shares and Iroko Warrant pursuant to the terms of the Asset Purchase Agreement. The description of the
Asset Purchase Agreement in Item 3 is incorporated by reference in this Section 6. The description of the Asset Purchase Agreement does not purport to be a complete description and is qualified in its entirety by reference to the full text
of such agreement, which is filed as part of this Schedule 13D and incorporated by reference herein. LSH acquired the Shares and the Iroko Warrant in connection with the Foreclosure Sale.
In connection with the acquisition of the Shares, the Issuer issued the Warrant to Iroko Properties, which was assigned to LSH on
June 28, 2019. Pursuant to the terms of the Warrant, LSH has the right to acquire up to 2,436,459 additional shares of Common Stock, provided however that, for a period of eighteen (18) months following the date of the issuance of the
Warrant, LSHs right to exercise the Warrant is restricted so that it does not hold more than 49% of the issued and outstanding shares of Common Stock. The description of the Warrant does not purport to be a complete description and is
qualified in its entirety by reference to the full text of such agreement, which is filed as part of this Schedule 13D and incorporated by reference herein.
The Issuer and Iroko Properties entered into the Stockholders Agreement dated as of January 31, 2019 with respect to the Shares (the
Stockholders Agreement
). Pursuant to the terms of the Stockholders Agreement, Iroko Properties has the right to appoint two (2) directors to the board of directors of the Issuer and to consult in the appointment of a third
director of the Issuer. In addition, Iroko Properties and its affiliates are not permitted to acquire additional shares of the Common Stock (other than via the exercise of the Iroko Warrant if permitted) for a period of eighteen (18) months
following the closing of the Asset Purchase Agreement and are restricted from selling more than fifty percent (50%) of each of the Shares and the Iroko Warrant for a period of ninety (90) days following the closing of the Asset Purchase
Agreement. The description of the Stockholders Agreement does not purport to be a complete description and is qualified in its entirety by reference to the full text of such agreement, which is filed as part of this Schedule 13D and incorporated by
reference herein. The Issuer and Iroko Properties entered into the Registration Rights Agreement dated as of January 31, 2019 (the
Registration Rights Agreement
). Pursuant to the terms of the Registration Rights Agreement,
Iroko Properties may demand that the Issuer register the Shares and the shares of Common Stock underlying the Iroko Warrant in certain circumstances. The description of the Registration Rights Agreement does not purport to be a complete description
and is qualified in its entirety by reference to the full text of such agreement, which is filed as part of this Schedule 13D and incorporated by reference herein.
Prior to the Foreclosure Sale, the CRG Entities and the Agent had a first priority lien on all of the assets of Iroko Pharmaceuticals and its
subsidiaries pursuant to the Term Loan Agreement. As a result of the Foreclosure Sale, LSH acquired all right, title and interest of Iroko Properties in, to and under the Stockholders Agreement, the Registration Rights Agreement and the other
consideration paid to Iroko Pharmaceuticals and its subsidiaries pursuant to the Asset Purchase Agreement.
Except as described herein,
the Reporting Persons have no contracts, arrangements, understandings or relationships (legal or otherwise) with respect to any securities of the Issuer.
Item 7. Material to Be Filed as Exhibits.
Exhibit AJoint Filing Agreement, dated as of July 2, 2019, by and among Iroko Properties, Iroko Pharmaceuticals, Nathan D. Hukill, CRG Parallel Fund
B, CRG Lev AIV, CRG Unlev AIV, CRG Partners III, CR Group L.P., CRG Parallel Fund A and Loan Security Holdings I LLC.
Exhibit BAsset Purchase
Agreement (incorporated by reference to Exhibit 2.1 to the Issuers Current Report on Form 8-K as filed with the Securities and Exchange Commission (the
Commission
) on October 31, 2018.)
Exhibit CWarrant (incorporated by reference to Exhibit 4.3 to the Issuers Current Report on Form 8-K as filed with the Commission on
February 1, 2019.)