Item 1.01. Entry into a Material Definitive Agreement.
As previously reported, on October 10, 2019, Cerecor Inc. (the “Company”) entered into an Asset Purchase Agreement (the “Purchase Agreement”) with Aytu Bioscience, Inc. (“Aytu”) to sell the Company’s rights, title and interest in, assets relating to its pediatric portfolio, namely Aciphex® Sprinkle™ , Cefaclor for Oral Suspension, Karbinal™ ER, Flexichamber™ , Poly-Vi-Flor® and Tri-Vi-Flor™ (the “Acquired Assets”). On November 1, 2019, the Company and Aytu entered into the First Amendment to Asset Purchase Agreement (the “First Amendment”). The First Amendment, among other things, made certain technical changes to the Purchase Agreement, including changes to the mechanics surrounding the conversion of the shares of convertible preferred stock of Aytu the Company received under the Purchase Agreement.
On November 1, 2019, in conjunction with the closing of the Acquisition (as defined below), the Company entered into a Guarantee (the “Guarantee”) in favor of Deerfield CSF, LLC, Peter Steelman and James Flynn (the “Creditors”). As previously disclosed in the Prior 8-K (as defined below), in conjunction with the Acquisition, Aytu assumed all of the Company’s liabilities under a Membership Interest Purchase Agreement, dated February 5, 2016, between the Company and the Creditors (the “MIPA”), including payments of royalty and debt obligations totaling approximately $26 million to the Creditors. The Guarantee guarantees the payment by Aytu of the assumed liabilities to the Creditors under the MIPA.
On November 1, 2019, the Company also entered into a contribution agreement (the “Contribution Agreement”) with Armistice Capital Master Fund, Ltd. (“Armistice”) and Avadel US Holdings Inc. (“Avadel”), which governs contribution rights and obligations of the Company, Armistice and Avadel with respect to amounts that are paid by Armistice and Avadel to the Creditors under certain guarantees made by Armistice and Avadel to the Creditors. Armistice, an affiliate of the Company, is the Company’s largest stockholder and Armistice’s Chief Investment Officer, Steven Boyd, currently sits on the Company’s Board of Directors. In compliance with its policies on related party transactions, the Contribution Agreement was reviewed and approved by the Audit Committee of the Board of Directors of the Company.
The foregoing descriptions of the First Amendment, the Guarantee and the Contribution Agreement do not purport to be complete and are qualified in their entirety by reference to the First Amendment, the Guarantee and the Contribution Agreement. Copies of the First Amendment, the Guarantee and the Contribution Agreement are incorporated by reference as Exhibits 2.1, 10.1 and 10.2, respectively.