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UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of
The
Securities Exchange Act of 1934
Date
of Report (Date of earliest event reported): July 5,
2024
Qualigen
Therapeutics, Inc.
(Exact
name of registrant as specified in its charter)
Delaware |
|
001-37428 |
|
26-3474527 |
(State
or other jurisdiction
of incorporation) |
|
(Commission
File Number) |
|
(I.R.S.
Employer
Identification No.) |
5857
Owens Avenue, Suite
300, Carlsbad,
California 92008
(Address
of principal executive offices) (Zip Code)
(760)
452-8111
(Registrant’s
telephone number, including area code)
n/a
(Former
name or former address, if changed since last report)
Check
the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under
any of the following provisions:
☐ |
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|
|
☐ |
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
|
|
☐ |
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
|
|
☐ |
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities
registered pursuant to Section 12(b) of the Act:
Title
of each class |
|
Trading
Symbol |
|
Name
of each exchange on which registered |
Common
Stock, par value $.001 per share |
|
QLGN |
|
The
Nasdaq Capital
Market of The Nasdaq Stock Market LLC |
Indicate
by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act (§230.405 of this
chapter) or Rule 12b-2 of the Exchange Act (§240.12b-2 of this chapter).
Emerging
growth company ☐
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐
Item
1.01. Entry into a Material Definitive Agreement.
Qualigen
Therapeutics, Inc. (the “Company”) and an institutional investor entered into a Securities Purchase Agreement dated July
5, 2024 (the “Agreement”), providing for the Company to issue to the investor at par a Senior Note with the following characteristics
and terms, against the investor’s loan of $2,000,000 in cash: (a) an original principal amount of $2,000,000, (b) unsecured, (c)
nonconvertible, (d) scheduled maturity date of July 8, 2025, (e) interest at the rate of 18% per annum, (f) requirement for partial prepayments
from a percentage of any future Company financings, and (g) otherwise, principal and interest on the Senior Note not payable until maturity.
The
Agreement also required the Company Board of Directors resignations and appointments as set forth in Item 5.02 below.
The
foregoing descriptions of the Agreement and the Senior Note do not purport to be complete and are qualified in their entirety by reference
to the full text as set forth in Exhibit 10.1, which is incorporated herein by reference.
Item
5.01 Changes in Control of Registrant.
The
information set forth under Item 1.01 and Item 5.02 of this Current Report on Form 8-K is incorporated into this Item 5.01 by reference.
Item
5.02. Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers.
On
July 5, 2024, Richard David, Sidney Emery, Kurt Kruger and Ira Ritter each resigned from his respective position as a member of the Company’s
Board of Directors effective upon the Company’s receipt of the $2,000,000 pursuant to the Agreement.
On
July 5, 2024, the Company’s Board of Directors appointed Campbell Becher, Robert Lim and Cody Price to serve as directors on the
Board effective upon the Company’s receipt of the $2,000,000 pursuant to the Agreement. Board Committee assignments for these three
persons have not yet been determined.
Item
8.01 Other Events.
On
July 5, 2024, the holder of the Company’s 8% Senior Convertible Debenture due December 22, 2025 completed its series of voluntary
conversions of the entire principal amount of the debenture (which had an original principal balance of $3,300,000) into Company common
stock; as a result (and also taking into account recent exercises of warrants) the Company currently has 11,382,830 shares of common
stock outstanding.
Item
9.01 Financial Statements and Exhibits.
(d)
Exhibits.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
|
QUALIGEN
THERAPEUTICS, INC. |
|
|
|
Date:
July 11, 2024 |
By: |
/s/
Michael S. Poirier |
|
|
Michael
S. Poirier, Chief Executive Officer |
Exhibit
10.1
SECURITIES
PURCHASE AGREEMENT
This
Securities Purchase Agreement (this “Agreement”) is dated as of July 5, 2024 between Qualigen Therapeutics, Inc.,
a Delaware corporation (the “Company”), and the purchaser identified on the Annex A hereto (including
its successors and assigns, the “Investor”.
WHEREAS,
the Investor wishes to purchase from the Company, and the Company wishes to issue and sell to the Investor, senior notes in the form
of Appendix A hereto (each, a “Note” and collectively, the “Notes”) in an aggregate
principal amount of $2,000,000; and
WHEREAS,
the Company and Investor are executing and delivering this Agreement in reliance upon an exemption from securities registration requirements
of the Securities Act of 1933, as amended, afforded by the provisions of Section 4(a)(2) and/or Rule 506(b) of Regulation D promulgated
thereunder by the U.S. Securities and Exchange Commission.
NOW,
THEREFORE, in consideration of the mutual covenants contained in this Agreement, and for other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, the Company and Investor agree as follows:
ARTICLE
I
DEFINITIONS
Section
1.01. Definitions. In addition to the terms defined elsewhere in this Agreement: (a) capitalized terms that are not
otherwise defined herein have the meanings given to such terms in the Notes (as defined herein), and (b) the following terms have
the meanings set forth in this Agreement.
“$”
means United States Dollars.
“Action”
shall have the meaning ascribed to such term in Section 3.01(k).
“Affiliate”
means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control
with a Person, as such terms are used in and construed under Rule 405 under the Securities Act.
“Board
of Directors” means the board of directors of the Company.
“Business
Day” means any day except Saturday, Sunday, any day which is a federal legal holiday in the United States or any day on which
banking institutions in the State of New York are authorized or required by law or other governmental action to close. If the last or
appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a Business Day, then
such action may be taken or such right may be exercised on the next succeeding Business Day.
“Closing”
means the closing of the purchase and sale of the Notes pursuant to Section 2.01.
“Closing
Date” means the Business Day when all of the Transaction Documents for such Notes have been executed and delivered by the applicable
parties thereto, and conditions precedent to (x) the Investor’s obligations to pay the Subscription Amount to the Company and (y)
the Company’s obligations to issue and deliver the Notes to the Company shall have been satisfied or waived.
“Commission”
means the United States Securities and Exchange Commission.
“Common
Stock” means the common stock of the Company, par value $0.001 per share, and any other class of securities into which such
securities may hereafter be reclassified or changed.
“Common
Stock Equivalent” means any convertible security or warrant, option or other right to subscribe for or purchase any additional
shares of Common Stock or any other Common Stock Equivalent.
“Exempt
Issuance” means the issuance by the Company of any Common Stock or standard options to purchase Common Stock to directors,
officers, employees or consultants of the Company or its Subsidiaries in their capacity as such pursuant to an employee benefit plan
which has been approved by the board of directors of the Company prior to or subsequent to the date hereof pursuant to which Common Stock
and standard options to purchase Common Stock may be issued to any employee, officer, director or consultant for services provided to
the Company or its subsidiaries in their capacity as such.
“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
“FINRA”
means the Financial Industry Regulatory Authority.
“Intellectual
Property Rights” shall have the meaning ascribed to such term in Section 3.01(p).
“Investor
Board Member Nominees” shall mean Robert Lim, Campbell Becher and Cody Price.
“Legend
Removal Date” shall have the meaning ascribed to such term in Section 4.01(c).
“Liens”
shall mean a lien, charge, security interest, encumbrance, right of first refusal, preemptive right or other restriction or adverse claim
of a third party.
“Material
Adverse Effect” shall have the meaning ascribed to such term in Section 3.01(b).
“Notes”
means the senior notes issued by the Company to the Investor hereunder, in the form of Appendix A attached hereto.
“Person”
means an individual or corporation, partnership, trust, incorporated or un-incorporated association, joint-venture, limited liability
company, joint-stock company, government (or an agency or subdivision thereof) or other entity of any kind.
“Proceeding”
means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial proceeding,
such as a deposition), whether commenced or threatened.
“Required
Approvals” shall have the meaning ascribed to such term in Section 3.01(e).
“SEC
Reports” has the meaning ascribed to such term in Section 3.01(h).
“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“State
Securities Laws” means the securities (or “blue sky”) rules, regulations, or other similar laws of a particular
state.
“Subscription
Amount” means the amount identified as such on Annex A hereto.
“Subsidiary”
means any subsidiary of the Company and shall, where applicable, include any direct or indirect subsidiary of the Company formed or acquired
after the date hereof.
“Termination
Date” means a date determined by the Company on which the offering of the Notes shall terminate.
“Transaction
Documents” means this Agreement, the Notes and all appendices, exhibits and schedules hereto and thereto and any other documents
or agreements executed in connection with the transactions contemplated hereunder.
ARTICLE
II
PURCHASE
AND SALE
Section
2.01 Closing. On the Closing Date, upon the terms and subject to the conditions set forth herein, substantially concurrent
with the execution and delivery of this Agreement by the parties hereto, the Company agrees to sell, and the Investor agrees to purchase,
an aggregate principal amount of Notes equal to the Subscription Amount. At the Closing, the Investor shall deliver, via wire transfer,
immediately available funds equal to such principal amount against which the Company shall deliver to Investor its Notes. The
Company and Investor shall deliver the other items set forth in Section 2.02 deliverable at the Closing. Upon satisfaction of the conditions
set forth in Sections 2.02 and 2.03, the Closing shall occur at the offices of the Investor’s counsel, or such other location as
the parties shall mutually agree or may be closed remotely by electronic delivery of documents. The Closing Date shall be the date indicated
on the Investor’s signature page attached hereto.
Section
2.02 Closing Deliverables.
(a) By
Investor. On or prior to the Closing Date, Investor shall deliver or cause to be delivered to the Company the following:
| (i) | this
Agreement duly executed by Investor; and |
| (ii) | Investor’s
Subscription Amount, by wire transfer to the Company pursuant to the wiring instructions
set forth in Section 2.03(c). |
(b) By
the Company. On or prior to the Closing Date, the Company shall deliver or cause to be delivered to Investor:
| (i) | this
Agreement, duly executed by an authorized officer of behalf of the Company; |
| (ii) | a
Note, the form of which is attached hereto as Appendix A, registered in the
name of Investor (or its nominee) and with a principal amount equal to the Investor’s
Subscription Amount, duly executed by an authorized officer of behalf of the Company; |
| (iii) | resignation
letters presented to the Board of Directors from members Richard David, Sidney Emery, Kurt
Kruger and Ira Ritter, each stating their resignation therefrom effective immediately upon
(but only upon and contingent upon) the Company’s actual receipt as provided herein
of the entire Subscription Amount; and |
| (iv) | an
officer’s certificate of the Company certifying the Company’s: (A) certified
charter (or similar formation document); (C) good standing certificate in its state of incorporation;
(D) bylaws (or similar governing document); and (D) resolutions of its Board of Directors
(or similar governing body) approving and authorizing the execution, delivery and performance
of the Transaction Documents and the transactions contemplated thereby (including, without
limitation, the matters contemplated by Section 2.02(b)(iii) above and Section 2.03(b)(v)
below). |
Section
2.03 Closing Conditions.
(a) The
obligations of the Company hereunder in connection with the Closing are subject to the following conditions being met:
| (i) | the
accuracy in all material respects on the Closing Date of Investor’s representations
and warranties contained herein; |
| (ii) | all
obligations, covenants and agreements of Investor required to be performed at or prior to
the Closing Date shall have been performed; and |
| (iii) | the
delivery by Investor of the items set forth in Section 2.02(a) of this Agreement. |
(b) The
obligations of Investor hereunder in connection with the Closing are subject to the following conditions being met (it being understood
that the Company may waive any of the conditions for any Closing hereafter):
| (i) | the
accuracy in all material respects (or, to the extent representations or warranties are qualified
by materiality or Material Adverse Effect, in all respects) when made and on the Closing
Date of the representations and warranties of the Company contained herein (unless as of
a specific date therein in which case they shall be accurate as of such date); |
| (ii) | all
obligations, covenants and agreements of the Company required to be performed at or prior
to the Closing Date shall have been performed; |
| (iii) | the
delivery by the Company of the items set forth in Section 2.02(b) of this Agreement; |
| (iv) | there
shall have been no Material Adverse Effect with respect to the Company since the date hereof;
and |
| (v) | each
of the three Investor Board Member Nominees shall have been elected or appointed and seated
as members of the Board of Directors effective immediately upon (but only upon and contingent
upon) the Company’s actual receipt as provided herein of the entire Subscription Amount. |
(c) The wiring instructions for the Company are as follows:
Beneficiary
Bank ABA: 122244029
Beneficiary’s
Bank: CalPrivate Bank
Beneficiary
Bank Address: 9404 Genesee Ave, Suite 100, La Jolla, CA
92037
Beneficiary’s
Account Number: 283592
Beneficiary’s
Name: Qualigen Therapeutics, Inc.
Beneficiary’s
Address: 5857 Owens Avenue, Suite 300, Carlsbad CA
92008
ARTICLE
III
REPRESENTATIONS AND WARRANTIES
Section
3.01 Representations and Warranties of the Company. The Company hereby represents and warrants to Investor that, except as
set forth in extant SEC Reports, the following representations are true and complete as of the date of the date hereof.
(a) Subsidiaries.
The Company does not have any Subsidiaries not disclosed in the SEC Reports.
(b) Organization
and Qualification. The Company is an entity duly incorporated or otherwise organized, validly existing and in good standing under
the laws of the State of Delaware, with the requisite power and authority to own and use its properties and assets and to carry on its
business as currently conducted. The Company is not in violation or default of any of the provisions of its articles of incorporation
or bylaws, each, as amended and in effect. A complete and correct copy of the Company’s certificate or articles of incorporation
and bylaws, each as amended and in effect on the date of this Agreement and as they will be in effect on the Closing Date, is attached
to the officer’s certificate referenced in Section 2.02(b)(iv). There are no other organizational or charter documents of the Company.
The Company is duly qualified to conduct business and is in good standing as a foreign corporation or other entity in each jurisdiction
in which the nature of the business conducted or property owned by it makes such qualification necessary, except where the failure to
be so qualified or in good standing, as the case may be, could not have or reasonably be expected to result in: (i) a material adverse
effect on the legality, validity or enforceability of any Transaction Document; (ii) a material adverse effect on the results of operations,
assets, business, prospects or condition (financial or otherwise) of the Company or any of its material assets or lines of business,
individually; or (iii) a material adverse effect on the Company’s ability to perform in any material respect on a timely basis
its obligations under any Transaction Document (any of (i), (ii) or (iii), a “Material Adverse Effect”) and no Proceeding
has been instituted in any such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail such power and authority
or qualification; provided, however, that “Material Adverse Effect” shall not include any event, occurrence, fact,
condition or change, directly or indirectly, arising out of or attributable to: (i) general economic or political conditions, (ii) conditions
generally affecting the industry in which the Company or any Subsidiary operates, (iii) any changes in financial or securities markets
in general, (iv) acts of war (whether or not declared), armed hostilities or terrorism, or the escalation or worsening thereof, (v) any
pandemic, epidemics or human health crises (including COVID-19), (vi) any changes in applicable laws or accounting rules, (vii) the announcement,
pendency or completion of the transactions contemplated by the Transaction Documents, or (viii) any action required or permitted by the
Transaction Documents or any action taken (or omitted to be taken) with the written consent of or at the written request of the Investor.
(c) Authorization;
Enforcement. The Company has the requisite corporate power and authority to enter into and to consummate the transactions contemplated
by each of the Transaction Documents and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery
of each of the Transaction Documents by the Company and the consummation by it of the transactions contemplated hereby and thereby have
been duly authorized by all necessary action on the part of the Company and no further action is required by the Company, the Board of
Directors or the Company’s stockholders in connection therewith other than in connection with the Required Approvals. Each Transaction
Document to which it is a party has been (or upon delivery will have been) duly executed by the Company and, when delivered in accordance
with the terms hereof and thereof, will constitute the valid and binding obligation of the Company enforceable against the Company in
accordance with its terms, except: (i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting enforcement of creditors’ rights generally; (ii) as limited by laws
relating to the availability of specific performance, injunctive relief or other equitable remedies; and (iii) insofar as indemnification
and contribution provisions may be limited by applicable law.
(d) No
Conflicts. The execution, delivery and performance by the Company of the Transaction Documents to which it is a party, the issuance
and sale of the Notes and the consummation by the Company of the other transactions contemplated hereby and thereby do not and will not:
(i) conflict with or violate any provision of the Company’s certificate of incorporation, bylaws or other organizational or charter
documents; (ii) conflict with, or constitute a default (or an event that with notice or lapse of time or both would become a default)
under, result in the creation of any Lien upon any of the properties or assets of the Company, or give to others any rights of termination,
amendment, acceleration or cancellation (with or without notice, lapse of time or both) of, any agreement, credit facility, debt or other
instrument (evidencing a Company debt or otherwise) or other understanding to which the Company is a party or by which any property or
asset of the Company is bound or affected; or (iii) subject to the Required Approvals, conflict with or result in a violation of any
law, rule, regulation, order, judgment, injunction, decree or other restriction of any court or governmental authority to which the Company
is subject (including federal and State Securities Laws and regulations), or by which any property or asset of the Company is bound or
affected; except in the case of each of clauses (ii) and (iii), such as could not have or reasonably be expected to result in a Material
Adverse Effect.
(e) Filings,
Consents and Approvals. The Company is not required to obtain any consent, waiver, authorization or order of, give any notice to,
or make any filing or registration with, any court or other federal, state, local or other governmental authority or other Person in
connection with the execution, delivery and performance by the Company of the Transaction Documents, other than: (i) such consents, waivers,
or authorizations as have been obtained before the Closing; and (ii) the filing of Form D with the Commission and such filings as are
required to be made under applicable State Securities Laws (collectively, the “Required Approvals”).
(f) Issuance
of the Notes. The Notes are duly authorized and, when issued and/or paid for in accordance with the applicable Transaction Documents,
will be duly and validly issued, fully paid and nonassessable, free and clear of all Liens other than restrictions on transfer provided
for in the Transaction Documents.
(g) Capitalization.
The capitalization of the Company is as set forth in the SEC Reports, except that the number of shares of common stock outstanding as
of the date of this Agreement is 11,382,830 and the entire remaining principal amount of the 8% Convertible Senior Debenture due December
22, 2025 has been converted into common stock. Except in instances where valid waivers have been obtained, no Person has any right of
first refusal, preemptive right, right of participation, or any similar right to participate in the transactions contemplated by the
Transaction Documents. Except as set forth in the SEC Reports, there are no Common Stock Equivalents of any character whatsoever relating
to, or securities, rights or obligations convertible into or exercisable or exchangeable for, or giving any Person any right to subscribe
for or acquire, any Common Stock or the capital stock of any Subsidiary, or contracts, commitments, understandings or arrangements by
which the Company or any Subsidiary is or may become bound to issue additional Common Stock or Common Stock Equivalents or capital stock
of any Subsidiary. The issuance and sale of the Notes will not obligate the Company or any Subsidiary to issue Common Stock or other
securities to any Person and will not result in a right of any holder of Company securities to adjust the exercise, conversion, exchange
or reset price under any of such securities. All of the outstanding shares of capital stock of the Company are duly authorized, validly
issued, fully paid and nonassessable, have been issued in compliance with all federal and state securities laws, and none of such outstanding
shares was issued in violation of any preemptive rights or similar rights to subscribe for or purchase securities. Except for the Required
Approvals and waivers that have heretofore been obtained, no further approval or authorization of any stockholder, the Board of Directors
or others is required for the issuance and sale of the Notes. There are no stockholder agreements, voting agreements or other similar
agreements with respect to the Company’s capital stock to which the Company is a party or, to the knowledge of the Company, between
or among any of the Company’s stockholders.
(h) SEC
Reports; Financial Statements. The Company has filed all reports, schedules, forms, statements and other documents required to be
filed by the Company under the Securities Act and the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for the two
years preceding the date hereof (or such shorter period as the Company was required by law or regulation to file such material) (the
foregoing materials, including the exhibits thereto and documents incorporated by reference therein, being collectively referred to herein
as the “SEC Reports”). As of their respective dates, the SEC Reports complied in all material respects with the requirements
of the Securities Act and the Exchange Act, as applicable, and none of the SEC Reports, when filed, contained any untrue statement of
a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading. The financial statements of the Company included in the
SEC Reports comply in all material respects with applicable accounting requirements and the rules and regulations of the SEC with respect
thereto as in effect at the time of filing. Such financial statements have been prepared in accordance with United States generally accepted
accounting principles applied on a consistent basis during the periods involved (“GAAP”), except as may be otherwise
specified in such financial statements or the notes thereto and except that unaudited financial statements may not contain all footnotes
required by GAAP, and fairly present in all material respects the financial position of the Company and its consolidated Subsidiaries
as of and for the dates thereof and the results of operations and cash flows for the periods then ended, subject, in the case of unaudited
statements, to normal year-end audit adjustments.
(i) Undisclosed
Liabilities. The Company has no liability, indebtedness, obligation, expense, claim, deficiency or guaranty of any type, whether
accrued, absolute, contingent, matured, unmatured or otherwise, required to be reflected in financial statements in accordance with GAAP,
which individually or in the aggregate: (A) has not been reflected in the latest balance sheet included in the financial statements referenced
hereinabove; or (B) has not arisen: (i) in the ordinary course of business, consistent with past practices, since the date of the latest
balance sheet included in such financial statements in an amount that does not exceed $25,000 in any one case or $50,000 in the aggregate,
(ii) pursuant to or in connection with this Agreement or other Transaction Document, or (c) are executory performance obligations to
be performed after the date hereof in the ordinary course of business pursuant to agreement(s) entered into in the ordinary course of
business, consistent with past practices. The Company is not in default with respect to any Indebtedness.
(j) Material
Changes. Since the date of the latest financial statements included in the SEC Reports: (A) there has been no event, occurrence or
development that has had or that could reasonably be expected to result in a Material Adverse Effect; (B) the Company has not incurred
any liabilities (contingent or otherwise) other than (i) trade payables and accrued expenses incurred in the ordinary course of business
consistent with past practice, and (ii) liabilities not required to be reflected in the Company’s financial statements pursuant
to GAAP; (C) the Company has not altered their method of accounting; (D) the Company has not declared or made any dividend or distribution
of cash or other property to its stockholders or purchased, redeemed or made any agreements to purchase or redeem any shares of its capital
stock except; and (E) the Company has not issued any equity securities except in favor of an officer, director or consultant pursuant
to an existing Company equity incentive plans.
(k) Litigation.
There is no action, suit, inquiry, notice of violation, proceeding or investigation pending or, to the knowledge of the Company, threatened
against or affecting the Company, or any of its properties, before or by any court, arbitrator, governmental or administrative agency
or regulatory authority (federal, state, county, local or foreign) (collectively, an “Action”) which: (A) adversely
affects or challenges the legality, validity or enforceability of any of the Transaction Documents or the Notes; or (ii) could, if there
were an unfavorable decision, have or reasonably be expected to result in a Material Adverse Effect. None of the Company or any director
or officer thereof, is or has been the subject of any Action involving: (x) a claim of violation of or liability under the Securities
Act, the Exchange Act, FINRA rules or any State Securities Laws; (y) breach of fiduciary duty; or (z) fraud (statutory or common law),
embezzlement, misappropriation or conversion of property or rights, or any other crime involving deceit.
(l) Labor
Relations. No labor dispute exists or, to the knowledge of the Company, is imminent with respect to any of the employees of the Company
which could reasonably be expected to result in a Material Adverse Effect. None of the Company’s employees is a member of a union
that relates to such employee’s relationship with the Company, and the Company is not a party to any collective bargaining agreement.
The Company believes that its relationships with its employees are good. No executive officer, to the knowledge of the Company, is, or
is now expected to be, in violation of any material term of any employment contract, confidentiality, disclosure or proprietary information
agreement or non- competition agreement, or any other contract or agreement or any restrictive covenant in favor of any third party,
and the continued employment of each such executive officer does not subject the Company to any liability with respect to any of the
foregoing matters. To the best of the Company’s knowledge, it is in compliance with all U.S. federal, state, local and foreign
laws and regulations relating to employment and employment practices, terms and conditions of employment and wages and hours, except
where the failure to be in compliance could not, individually or in the aggregate, reasonably be expected to have a Material Adverse
Effect.
(m) Compliance.
Except as disclosed set forth in the SEC Reports, the Company: (i) is neither in default under nor in violation of (and no event has
occurred that has not been waived that, with notice or lapse of time or both, would result in a default by the Company under), nor has
the Company received notice of a claim that it is in default under or that it is in violation of, any indenture, loan or credit agreement
or any other agreement or instrument to which it is a party or by which it or any of its properties is bound (whether or not such default
or violation has been waived); (ii) is not in violation of any order of any court, arbitrator or governmental body; and (iii) is not
and has not been in material violation of any statute, law, rule or regulation of any governmental authority, including without limitation
all foreign, federal, state and local laws applicable to its business and all such laws that affect the environment.
(n) Regulatory
Permits. The Company possesses all certificates, authorizations and permits issued by the appropriate federal, state, local or foreign
regulatory authorities necessary to conduct its business, except where the failure to possess such permits could not reasonably be expected
to result in a Material Adverse Effect, and the Company has not received any notice of proceedings relating to the revocation or modification
of any of the foregoing.
(o) Title
to Assets. The Company and its Subsidiaries have good and marketable title in fee simple to all real property and good and marketable
title in all personal property owned by it that, in each case, is material to the business of the Company and its Subsidiaries, in each
case free and clear of all Liens, except for Liens that do not materially and adversely (x) affect the value of such property or (y)
interfere with the use made and proposed to be made of such property by the Company and its Subsidiaries. Any real property and facilities
held under lease by the Company or a Subsidiary is held by it under valid, subsisting and enforceable leases with which the Company or
such Subsidiary (as applicable) are in compliance.
(p) Patents
and Trademarks. (i) The Company has, or has rights to use, all patents, patent applications, trademarks, trademark applications,
service marks, trade names, trade secrets, inventions, copyrights, licenses and other intellectual property rights and similar
rights as necessary or material for use in connection with its business and which the failure to so have could reasonably be expected
to have a Material Adverse Effect (collectively, the “Intellectual Property Rights”); (ii) the Company has not received
a notice (written or otherwise) that any of the Intellectual Property Rights violates or infringes upon the intellectual property rights
of any other Person; (iii) all Intellectual Property Rights are enforceable by the Company, and there is no existing infringement by
any other Person of any of the Intellectual Property Rights, except where the failure to be so enforceable or for such infringements
as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect; and (iv) the Company has taken
reasonable security measures to protect the secrecy, confidentiality and value of all of its Intellectual Property Rights, except where
failure to do so could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(q) Transactions
with Officers, Directors and Employees. None of the officers or directors of the Company and, to the knowledge of the Company, none
of the employees of the Company, is presently a party to any transaction with the Company (other than for services as employees, officers
and directors), including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for
rental of real or personal property to or from, or otherwise requiring payments to or from, any such officer, director or employee or,
to the knowledge of the Company, any entity in which any such officer, director or employee has a substantial interest or is an officer,
director, trustee, member or partner, in each case other than for: (x) payment of salary or fees for services rendered; (y) reimbursement
for expenses incurred on behalf of the Company; and (z) other employee benefits, including stock option agreements under any stock option
plan of the Company.
(r) [Intentionally
Omitted].
(q) Private
Placement. Assuming the accuracy of the Investor’s representations and warranties set forth in Section 3.02, no registration
under the Securities Act is required for the offer and sale of the Notes by the Company to the Investor as contemplated hereby.
(r) Investment
Company. The Company is not, and is not an Affiliate of, and immediately after receipt of payment for the Notes will not be or be
an Affiliate of, an ‘investment company’ within the meaning of the Investment Company Act of 1940, as amended. The Company
shall conduct its business in a manner so that it will not be an “investment company” subject to registration under the Investment
Company Act of 1940, as amended.
(s) Registration
Rights. Other than pursuant to the Transaction Documents, no Person has any right to demand the Company to file a registration statement
under the Securities Act covering the sale of any securities of the Company.
(t) Disclosure.
Except with respect to: (i) the material terms and conditions of the transactions contemplated by the Transaction Documents; and (ii)
information given to the Investor, if any, which the Company hereby confirms will not constitute material non-public information, the
Company confirms that neither it nor any other Person acting on its behalf has provided any of the Investor or their agents or counsel
with any information that it believes constitutes or might constitute material, nonpublic information. The Company understands and confirms
that the Investor will rely on the foregoing representation in effecting transactions in securities of the Company. All disclosure furnished
by or on behalf of the Company to the Investor regarding the Company, its business and the transactions contemplated hereby, is true
and correct and does not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make
the statements made therein, in light of the circumstances under which they were made, not misleading.
(u) No
Integrated Offering. Assuming the accuracy of the Investor’s representations and warranties set forth in Section 3.02, neither
the Company, nor any of its Affiliates, nor any Person acting on its or their behalf has, directly or indirectly, made any offers or
sales of any security or solicited any offers to buy any security, under circumstances that would cause this offering of the Notes to
be integrated with prior offerings by the Company for purposes of the Securities Act which would require the registration of any such
securities under the Securities Act.
(v) Solvency.
Based on the consolidated financial condition of the Company as of the Closing Date after giving effect to the receipt by the Company
of the proceeds from the sale of the Notes hereunder: (i) the fair saleable value of the Company’s assets exceeds the amount that
will be required to be paid on or in respect of the Company’s existing debts and other liabilities (including known contingent
liabilities) as they mature; (ii) the Company’s assets do not constitute unreasonably small capital to carry on its business as
now conducted and as proposed to be conducted including its capital needs taking into account the particular capital requirements of
the business conducted by the Company, and projected capital requirements and capital availability thereof; and (iii) the current cash
flow of the Company, together with the proceeds the Company would receive, were it to liquidate all of its assets, after taking into
account all anticipated uses of the cash, would be sufficient to pay all amounts on or in respect of its liabilities when such amounts
are required to be paid. The Company will not, after the Closing Date, incur debts beyond its ability to pay such debts as they mature
(taking into account the timing and amounts of cash to be payable on or in respect of its debt). Except as disclosed in the SEC Reports,
the Company has no knowledge of any facts or circumstances which lead it to believe that it will file for reorganization or liquidation
under the bankruptcy or reorganization laws of any jurisdiction within one year from the Closing Date.
(w) Tax
Status. Except for matters that would not, individually or in the aggregate, have or reasonably be expected to result in a Material
Adverse Effect, the Company has filed all federal, state and foreign income and franchise tax returns and have paid or accrued all taxes
shown as due thereon, and the Company has no knowledge of a tax deficiency which has been asserted or threatened against the Company.
(x) No
General Solicitation. Neither the Company nor any Person acting on behalf of the Company has offered or sold any of the Notes by
any form of general solicitation or general advertising. The Company has offered the Notes for sale only to the Investor.
(y) Insurance.
The Company is insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as management
of the Company reasonably believes to be prudent and customary in the businesses in which the Company is engaged. The Company has never
been refused any insurance coverage sought or applied for, and the Company has no reason to believe that it will not be able to renew
all existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers.
(z) Acknowledgment
Regarding Investor’s Purchase of Notes. The Company acknowledges and agrees that the Investor is acting solely in the capacity
of an arm’s length purchaser with respect to the Transaction Documents and the transactions contemplated thereby. The Company further
acknowledges that the Investor is not acting as a financial advisor or fiduciary of the Company (or in any similar capacity) with respect
to the Transaction Documents and the transactions contemplated thereby and any advice given by Investor or any of their respective representatives
or agents in connection with the Transaction Documents and the transactions contemplated thereby is merely incidental to the Investor’s
purchase of the Notes. The Company further represents to the Investor that the Company’s decision to enter into this Agreement
and the other Transaction Documents has been based solely on the independent evaluation of the transactions contemplated hereby by the
Company and its representatives.
(aa) No
Disqualification Events. With respect to Notes to be offered and sold hereunder in reliance on Rule 506(b) under the Securities Act
(“Regulation D Securities”), none of the Company, any of its predecessors, any affiliated issuer, any director, executive
officer, other officer of the Company participating in the offering hereunder, any beneficial owner of twenty percent (20%) or more of
the Company’s outstanding voting equity securities, calculated on the basis of voting power, nor any promoter (as that term is
defined in Rule 405 under the Securities Act) connected with the Company in any capacity at the time of sale (each, an “Issuer
Covered Person” and, together, “Issuer Covered Persons”) is subject to any of the ‘Bad Actor’ disqualifications
described in Rule 506(d)(1)(i) to (viii) under the Securities Act (a “Disqualification Event”), except for a Disqualification
Event covered by Rule 506(d)(2) or (d)(3). The Company has exercised reasonable care to determine whether any Issuer Covered Person is
subject to a Disqualification Event. The Company has complied, to the extent applicable, with its disclosure obligations under Rule 506(e),
and has furnished to the Investor a copy of any disclosures provided thereunder.
(bb) Other
Covered Persons. The Company is not aware of any person (other than any Issuer Covered Person) that has been or will be paid (directly
or indirectly) remuneration for solicitation of purchasers in connection with the sale of any Regulation D Securities.
(cc) Notice
of Disqualification Events. The Company will notify the Investor in writing, prior to the Closing Date of: (i) any Disqualification
Event relating to any Issuer Covered Person; and (ii) any event that would, with the passage of time, become a Disqualification Event
relating to any Issuer Covered Person.
(dd) Foreign
Corrupt Practices. Neither the Company nor, to the knowledge of the Company, no agent or other person acting on behalf of the Company,
has: (i) directly or indirectly, used any funds for unlawful contributions, gifts, entertainment or other unlawful expenses related to
foreign or domestic political activity; (ii) made any unlawful payment to foreign or domestic government officials or employees or to
any foreign or domestic political parties or campaigns from corporate funds; (iii) failed to disclose fully any contribution made by
the Company (or made by any person acting on its behalf of which the Company is aware) which is in violation of law; or (iv) violated
in any material respect any provision of the Foreign Corrupt Practices Act.
(ee) Office
of Foreign Assets Control. Neither the Company nor, to the Company’s knowledge, any director, officer, agent, employee or Affiliate
of the Company, is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury
Department (“OFAC”).
(ff) U.S.
Real Property Holding Corporation. The Company is not and has never been a U.S. real property holding corporation within the meaning
of Section 897 of the Internal Revenue Code of 1986, as amended, and the Company shall so certify upon Investor’s request.
(gg) Bank
Holding Company Act. Neither the Company nor any of its Affiliates is subject to the Bank Holding Company Act of 1956, as amended
(“BHCA”) and to regulation by the Board of Governors of the Federal Reserve System (“Federal Reserve”). Neither
the Company nor any of its Affiliates owns or controls, directly or indirectly, five percent (5%) or more of the outstanding shares of
any class of voting securities or twenty-five percent (25%) or more of the total equity of a bank or any entity that is subject to the
BHCA and to regulation by the Federal Reserve. Neither the Company nor any of its Affiliates exercises a controlling influence over the
management or policies of a bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve.
(hh) Money
Laundering. The operations of the Company are and have been conducted at all times in compliance with applicable financial record-keeping
and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, applicable money laundering statutes
and applicable rules and regulations thereunder (collectively, the “Money Laundering Laws”), and no Action or Proceeding
by or before any court or governmental agency, authority or body or any arbitrator involving the Company with respect to the Money Laundering
Laws is pending or, to the knowledge of the Company, threatened.
(ii) Representations.
The representations and warranties of the Company contained in this Agreement, and the certificate(s) furnished or to be furnished to
the Investor at the Closing, when taken as a whole, do not contain any untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements contained herein or therein not misleading in light of the circumstances under which they
were made. The Company acknowledges and agrees that the representations contained in section 3.02 shall not modify, amend or affect the
Investor’s right to rely on the Company’s representations and warranties contained in this section 3.01 or elsewhere in this
Agreement or any representations and warranties contained in any other Transaction Document, or any other document or instrument executed
and/or delivered in connection with this Agreement or the consummation of the transactions contemplated hereby.
Section
3.02 Representations and Warranties of the Investor.
The
Investor hereby represents and warrants as of the date hereof and as of the Closing Date to the Company as follows (unless as of a specific
date therein, in which case they shall be accurate as of such date):
(a) Authority;
Organization. The Investor has full power and authority to enter into this Agreement and to perform all obligations required to
be performed by it hereunder. If an entity, The Investor is an entity duly organized, validly existing and in good standing under
the laws of the jurisdiction of its organization with full right, corporate or partnership power and authority to enter into and to
consummate the transactions contemplated by the Transaction Documents and otherwise to carry out its obligations hereunder and
thereunder. The execution and delivery of the Transaction Documents and performance by the Investor of the transactions contemplated
by the Transaction Documents have been duly authorized by all necessary corporate or similar action on the part of the Investor.
Each Transaction Document to which it is a party has been duly executed by the Investor, and when delivered by the Investor in
accordance with the terms hereof, will constitute the valid and legally binding obligation of the Investor, enforceable against it
in accordance with its terms, except: (i) as limited by general equitable principles and applicable bankruptcy, insolvency,
reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as
limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies, and (iii)
insofar as indemnification and contribution provisions may be limited by applicable law.
(b) Own
Account. The Investor understands that the Notes are “restricted securities” and have not been registered under the Securities
Act or any applicable State Securities Law and is acquiring the Notes as principal for its own account and not with a view to or for
distributing or reselling such Notes or any part thereof in violation of the Securities Act or any applicable State Securities Law, has
no present intention of distributing any of such Notes in violation of the Securities Act or any applicable State Securities Law and
has no direct or indirect arrangement or understandings with any other persons to distribute or regarding the distribution of such Notes
(this representation and warranty not limiting the Investor’s right to sell the Notes in compliance with applicable federal and
State Securities Laws) in violation of the Securities Act or any applicable State Securities Law. The Investor is acquiring the Notes
hereunder in the ordinary course of its business.
(c) Non-Transferrable.
The Investor agrees: (i) that the Investor will not sell, assign, pledge, give, transfer or otherwise dispose of the Notes or any interest
therein, or make any offer or attempt to do any of the foregoing, except pursuant to a registration of the Notes under the Securities
Act and all applicable State Securities Laws, or in a transaction which is exempt from the registration provisions of the Securities
Act and all applicable State Securities Laws, (ii) that the certificates representing the Notes will bear a legend making reference to
the foregoing restrictions, and (iii) that the Company and its Affiliates shall not be required to give effect to any purported transfer
of such Notes except upon compliance with the foregoing restrictions.
(d) Investor
Status. The Investor is an “accredited investor” as defined in Rule 501(a) under Regulation D of the Securities Act.
The undersigned agrees to furnish any additional information requested by the Company or any of its Affiliates to assure compliance with
applicable U.S. federal and state securities laws in connection with the purchase and sale of the Notes. Any information that has been
furnished or that will be furnished by the undersigned to evidence its status as an accredited investor is accurate and complete, and
does not contain any misrepresentation or material omission.
(e) Experience
of The Investor. The Investor, either alone or together with its representatives, has such knowledge, sophistication, and experience
in business and financial matters so as to be capable of evaluating the merits and risks of the prospective investment in the Notes,
and has so evaluated the merits and risks of such investment. The Investor is able to bear the economic risk of an investment in the
Notes and, at the present time, is able to afford a complete loss of such investment.
(f) No
Trading Market. The Investor acknowledges that there is currently no trading market for the Notes and that none is expected to develop
for the Notes.
(g) General
Solicitation. The Investor acknowledges that neither the Company nor any other person offered to sell the Notes to it by means of
any form of general solicitation or advertising, including, but not limited to: (i) any advertisement, article, notice, or other communication
published in any newspaper, magazine or similar media or broadcast over television or radio, or (ii) any seminar or meeting whose attendees
were invited by any general solicitation or general advertising.
(h) Confidentiality.
Other than to other Persons party to this Agreement and its advisors who have agreed to keep information confidential or have a fiduciary
obligation to keep such information confidential, the Investor has maintained the confidentiality of all disclosures made to it in connection
with the transaction (including the existence and terms of this transaction).
(i) Foreign
Investor. If the Investor is not a United States person, the Investor represents that it has satisfied itself as to the full observance
of the laws of its jurisdiction in connection with any invitation to subscribe for the Notes or any use of this Agreement, including:
(i) the legal requirements within its jurisdiction for the purchase of the Notes, (ii) any foreign exchange restrictions applicable to
such purchase, (iii) any governmental or other consents that may need to be obtained, and (iv) the income tax and other tax consequences,
if any, that may be relevant to the purchase, holding, redemption, sale or transfer of the Notes. The Investor further represents that
its payment for, and its continued beneficial ownership of the Notes, will not violate any applicable securities or other laws of its
jurisdiction.
(j) Information
from Company. The Investor and its investment managers, if any, have been afforded the opportunity to obtain any information necessary
to verify the accuracy of any representations or information presented by the Company in this Agreement and have had all inquiries to
the Company answered, and have been furnished all requested materials, relating to the Company and the offering and sale of the Notes
and anything set forth in the Transaction Documents. Neither the Investor nor the Investor’s investment managers, if any, have
been furnished any offering literature by the Company or any of its Affiliates, associates, or agents other than the Transaction Documents,
and the agreements referenced therein.
(k) [Intentionally
Omitted]
(l) Speculative
Nature of Investment; Risk Factors. THE INVESTOR UNDERSTANDS THAT AN INVESTMENT IN THE NOTES INVOLVES A HIGH DEGREE OF RISK.
The Investor acknowledges that: (i) any projections, forecasts or estimates as may have been provided to the Investor are purely speculative
and cannot be relied upon to indicate actual results that may be obtained through this investment; any such projections, forecasts and
estimates are based upon assumptions which are subject to change and which are beyond the control of the Company or its management, (ii)
the tax effects which may be expected by this investment are not susceptible to absolute prediction, and new developments and rules of
the Internal Revenue Service, audit adjustment, court decisions or legislative changes may have an adverse effect on one or more of the
tax consequences of this investment, and (iii) the Investor has been advised to consult with his own advisor regarding legal matters
and tax consequences involving this investment. The Investor represents that the Investor’s investment objective is speculative
in that the Investor seeks the maximum total return through an investment in a broad spectrum of securities, which involves a higher
degree of risk than other investment styles and therefore the Investor’s risk exposure is also speculative. The Notes offered hereby
are highly speculative and involve a high degree of risk and Investor should only purchase these securities if Investor can afford to
lose their entire investment.
(m) [Intentionally
Omitted]
(n) Money
Laundering. The operations of the Investor are and have been conducted at all times in compliance with applicable financial record-keeping
and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, applicable money laundering statutes
and applicable rules and regulations thereunder (collectively, the “Money Laundering Laws”), and no Action or Proceeding
by or before any court or governmental agency, authority or body or any arbitrator involving the Company with respect to the Money Laundering
Laws is pending or, to the knowledge of the Company or any Subsidiary, threatened.
The
Company acknowledges and agrees that the representations contained in Section 3.02 shall not modify, amend or affect the Investor’s
right to rely on the Company’s representations and warranties contained in this Agreement or any representations and warranties
contained in any other Transaction Document or any other document or instrument executed and/or delivered in connection with this Agreement
or the consummation of the transaction contemplated hereby.
ARTICLE
IV
OTHER AGREEMENTS OF THE PARTIES
Section
4.01 Transfer Restrictions.
(a) The
Notes may only be disposed of in compliance with state and federal securities laws. In connection with any transfer of Notes other than
pursuant to an effective registration statement, the Company may require the transferor thereof to provide to the Company an opinion
of counsel selected by the transferor and reasonably acceptable to the Company, the form and substance of which opinion shall be reasonably
satisfactory to the Company, to the effect that such transfer does not require registration of such transferred Notes under the Securities
Act. The Notes may not be sold or transferred by the Investor without the written consent of the Company, which shall not be unreasonably
withheld. As a condition of such sale or transfer, any such transferee shall agree in writing to be bound by the terms of this Agreement
and shall have the rights of the Investor under this Agreement.
(b) The
Investor agrees to the imprinting, so long as is required by this Section 4.01, of a legend on any of the Notes in the following form:
THIS
SECURITY HAS NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON
AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY
NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION
FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE
SECURITIES LAWS. THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.
(c) The
Investor will sell Notes only pursuant to the Securities Act, including any applicable prospectus delivery requirements, or an exemption
therefrom, and that if Notes are sold pursuant to a registration statement, they will be sold in compliance with the plan of distribution
set forth therein, and acknowledges that the removal of the restrictive legend from certificates representing Notes as set forth in this
Section 4.01 is predicated upon the Company’s reliance upon this understanding.
Section
4.02 Subsequent Financings.
(a) Public
Equity Financing. The Investor and Company shall cooperate with each other and use commercially reasonable efforts to consummate
a “best efforts” or underwritten public offering/equity financing of the Company registered under the Securities Act as soon
as practicable after the date hereof.
(b) Mandatory
Pay-Down of Notes. Notwithstanding anything to the contrary set forth herein or the Notes, not less than twenty percent (20%) of
the net cash proceeds of any debt or equity financing (including any public offering/equity financing but excluding an Exempt Issuance
or pursuant to the Transaction Documents) agreement or arrangement of the Company and/or any Subsidiary occurring after the Closing Date
shall be used to pay or prepay outstanding Notes (pro rata among holders thereof) in accordance with the terms thereof.
Section
4.03 Integration. The Company shall not sell, offer for sale, or solicit offers to buy or otherwise negotiate in respect of
any security (as defined in Section 2 of the Securities Act) that would be integrated with the offer or sale of the Notes to the Investor
in a manner that would require the registration under the Securities Act of the sale of the Notes to the Investor.
Section
4.04 Publicity. The Company and the Investor shall consult with each other in issuing any other press releases with respect
to the transactions contemplated hereby, and neither the Company nor the Investor shall issue any such press release nor otherwise make
any such public statement without the prior consent of the Company with respect to any press release of the Investor, or without the
prior consent of the Investor with respect to any press release of the Company mentioning the Investor, which consent shall not unreasonably
be withheld or delayed, except if such disclosure is required by law, in which case the disclosing party shall promptly provide the other
party with prior notice of such public statement or communication.
Section
4.05 Indemnification of Investor. The Company shall indemnify, reimburse and hold harmless the Investor and its partners, members,
shareholders, officers, directors, employees and agents (and any other persons with other titles that have similar functions) (collectively,
“Indemnitees”) from and against any and all losses, claims, liabilities, damages, penalties, suits, costs and expenses,
of any kind or nature, (including fees relating to the cost of investigating and defending any of the foregoing) imposed on, incurred
by or asserted against such Indemnitee in any way related to or arising from or alleged to arise from: (i) any breach of any of the representations,
warranties, covenants or agreements made by the Company in this Agreement or in the other Transaction Documents and (ii) any action instituted
against such Indemnitee in any capacity, or any of them or their respective Affiliates, by any stockholder of the Company who is not
an Affiliate of such Indemnitee, with respect to any of the transactions contemplated by the Transaction Documents (unless such action
is based upon a breach of such Indemnitee’s representations, warranties or covenants under the Transaction Documents or any agreements
or understandings such Indemnitee may have with any such stockholder or any violations by such Indemnitee of state or federal securities
laws or any conduct by such Indemnitee which results from the gross negligence or willful misconduct of the Indemnitee as determined
by a final, nonappealable decision of a court of competent jurisdiction).
ARTICLE
V
MISCELLANEOUS
Section
5.01 Fees and Expenses. The Company shall bear its own expenses incurred in connection with its negotiation, preparation, execution,
delivery and performance of the Transaction Documents, including, without limitation, reasonable attorneys’ and consultants’
fees and expenses, transfer agent fees, fees for stock quotation services, fees relating to any amendments or modifications of the Transaction
Documents or any consents or waivers of provisions in the Transaction Documents, fees for the preparation of opinions of counsel, escrow
fees, and costs of restructuring the transactions contemplated by the Transaction Documents. When possible, the Company must pay these
fees directly, including, but not limited to, any and all wire fees; otherwise the Company must make immediate payment for reimbursement
to the Investor for all fees and expenses immediately upon written notice by the Investor or the submission of an invoice by the Investor.
Section
5.02 Entire Agreement. The Transaction Documents, together with the exhibits and schedules thereto, contain the entire understanding
of the parties with respect to the subject matter hereof and supersede all prior agreements and understandings, oral or written, with
respect to such matters, which the parties acknowledge have been merged into such documents, exhibits and schedules.
Section
5.03 Notices. Any notice, request, instruction or other document to be given hereunder by any party to the others shall be
in writing and delivered personally or sent by registered or certified mail, postage prepaid, or by or email:
if
to Investor:
Corbo
Capital Inc.
131
Bloor St W.
Toronto
ON M5S 1S3
Canada
Attn:
Adam V. Chambers
Email:
achambers@corbocapital.com
with
a copy to:
Sichenzia
Ross Ference Carmel LLP
1185
Avenue of the Americas, 31st Floor
New
York, NY 10036
Attn:
Ross Carmel, Esq.
Email:
rcarmel@srfc.law
if
to the Company:
Qualigen
Therapeutics, Inc.
5857
Owens Avenue, Suite 300
Carlsbad,
CA 92008
Attention:
Michael Poirier, CEO
Email:
mpoirier@qlgntx.com
or
to such other persons or addresses as may be designated in writing by the party to receive such notice as provided above.
Section
5.04 Amendments; Waivers. No provision of this Agreement may be waived, modified, supplemented, or amended except in a written
instrument signed, in the case of an amendment, by the Company and the Investor or, in the case of a waiver, by the party against whom
enforcement of any such waived provision is sought. No waiver of any default with respect to any provision, condition or requirement
of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other
provision, condition or requirement hereof, nor shall any delay or omission of any party to exercise any right hereunder in any manner
impair the exercise of any such right.
Section
5.05 Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors
and permitted assigns. The Company may not assign this Agreement or any rights or obligations hereunder without the prior written consent
of the Investor (other than by merger). The Investor may assign any or all of its rights under this Agreement to any Person to whom the
Investor assigns or transfers any Notes, provided that such transfer complies with all applicable federal and State Securities Laws and
that such transferee agrees in writing with the Company to be bound, with respect to the transferred Notes, by the provisions of the
Transaction Documents that apply to the “Investor.”
Section
5.06 No Third-Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective successors
and permitted assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other Person.
Section
5.07 Governing Law. All questions concerning the construction, validity, enforcement and interpretation of the Transaction
Documents shall be governed by and construed and enforced in accordance with the internal laws of the State of Florida, without regard
to the principles of conflict of laws thereof. Each party agrees that all legal proceedings concerning the interpretation, enforcement
and defense of the transactions contemplated by any of the Transaction Documents (whether brought against a party hereto or its Affiliates,
directors, officers, shareholders, employees or agents) shall be commenced exclusively in the federal and state courts sitting in the
County of New York, New York (the “New York Courts”). Each party hereto hereby irrevocably submits to the exclusive
jurisdiction of the New York Courts for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated
hereby or discussed herein (including with respect to the enforcement of any of the Transaction Documents), 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 such New
York Courts, or such New York Courts are improper or inconvenient venue for such proceeding. 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 via registered
or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for 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 other manner permitted by applicable law. Each party hereto
hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding
arising out of or relating to the Transaction Documents or the transactions contemplated hereby. If any party shall commence an action
or proceeding to enforce any provisions of the Transaction Documents, then the prevailing party in such action or proceeding shall be
reimbursed by the other party for its attorney’s fees and other costs and expenses incurred in the investigation, preparation and
prosecution of such action or proceeding.
Section
5.08 Survival. The representations and warranties contained herein shall survive the Closing and the delivery of the Notes.
Section
5.09 Execution. This Agreement may be executed in two or more counterparts, all of which when taken together 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,
it being understood that both parties need not sign the same counterpart. In the event that any signature is delivered by facsimile transmission
or by e-mail delivery of a “.pdf” format data file, such signature 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 facsimile or “.pdf” signature
page was an original thereof.
Section
5.10 Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction
to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall
remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their commercially
reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated
by such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that they would
have executed the remaining terms, provisions, covenants and restrictions without including any of such that may be hereafter declared
invalid, illegal, void or unenforceable.
Section
5.11 Rescission and Withdrawal Right. Notwithstanding anything to the contrary contained in (and without limiting any similar
provisions of) any of the other Transaction Documents, whenever the Investor exercises a right, election, demand or option under a Transaction
Document and the Company does not timely perform its related obligations within the periods therein provided, then the Investor may rescind
or withdraw, in its sole discretion from time to time upon written notice to the Company, any relevant notice, demand or election in
whole or in part without prejudice to its future actions and rights.
Section
5.12 Replacement of Notes. If any certificate or instrument evidencing any Notes is mutilated, lost, stolen or destroyed, the
Company shall issue or cause to be issued in exchange and substitution for and upon cancellation thereof (in the case of mutilation),
or in lieu of and substitution therefor, a new certificate or instrument, but only upon receipt of evidence reasonably satisfactory to
the Company of such loss, theft or destruction. The applicant for a new certificate or instrument under such circumstances shall also
pay any reasonable third-party costs (including customary indemnity) associated with the issuance of such replacement Notes.
Section
5.13 Remedies. In addition to being entitled to exercise all rights provided herein or granted by law, including recovery of
damages, each of the Investor and the Company will be entitled to seek specific performance under the Transaction Documents. The parties
agree that monetary damages may not be adequate compensation for any loss incurred by reason of any breach of obligations contained in
the Transaction Documents and hereby agree to waive and not to assert in any action for specific performance of any such obligation the
defense that a remedy at law would be adequate.
Section
5.14 Payment Set Aside. To the extent that the Company makes a payment or payments to the Investor pursuant to any Transaction
Document or the Investor enforces or exercises its rights thereunder, and such payment or payments or the proceeds of such enforcement
or exercise or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside, recovered from, disgorged
by or are required to be refunded, repaid or otherwise restored to the Company, a trustee, receiver or any other person under any law
(including, without limitation, any bankruptcy law, state or federal law, common law or equitable cause of action), then to the extent
of any such restoration the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force
and effect as if such payment had not been made or such enforcement or setoff had not occurred.
Section
5.15 Construction. The parties agree that each of them and/or their respective counsel has reviewed and had an opportunity
to revise the Transaction Documents and, therefore, the normal rule of construction to the effect that any ambiguities are to be resolved
against the drafting party shall not be employed in the interpretation of the Transaction Documents or any amendments hereto. In addition,
each and every reference to share prices and shares of Common Stock in any Transaction Document shall be subject to adjustment for reverse
and forward stock splits, stock dividends, stock combinations and other similar transactions of the Common Stock that occur after the
date of this Agreement.
Section
5.16 Headings. The headings herein are for convenience only, do not constitute a part of this Agreement and shall not be deemed
to limit or affect any of the provisions hereof.
Section
5.17 WAIVER OF JURY TRIAL. IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY,
THE PARTIES EACH KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY,
IRREVOCABLY AND EXPRESSLY WAIVES FOREVER TRIAL BY JURY.
[SIGNATURE
PAGES FOLLOW]
IN
WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be duly executed by their respective authorized
signatories as of the date below.
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QUALIGEN
THERAPEUTICS, INC. |
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By: |
/s/
Michael Poirier |
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Name:
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Michael
Poirier |
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Title:
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Chief
Executive Officer |
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INVESTOR: |
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The
Investor executing the Signature Page in the form attached hereto as Annex A and delivering the same to the
Company or its agents shall be deemed to have executed this Agreement and agreed to the terms hereof. |
Annex
A
Securities
Purchase Agreement Investor Counterpart Signature Page
The
undersigned, desiring to: (i) enter into this Securities Purchase Agreement dated as of July 5, 2024 (the “Agreement”),
with the undersigned, Qualigen Therapeutics, Inc., a Delaware corporation (the “Company”), in or substantially in
the form furnished to the undersigned and (ii) purchase the Notes as set forth below, hereby agrees to purchase such Notes from the Company
as of the Closing and further agrees to join the Agreement as a party thereto, with all the rights and privileges appertaining thereto,
and to be bound in all respects by the terms and conditions thereof. The undersigned specifically acknowledges having read the representations
in this Agreement’s section entitled “Representations Warranties of the Investor”, and hereby represents that the statements
contained therein are complete and accurate with respect to the undersigned as the Investor.
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INVESTOR: |
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CORBO
CAPITAL INC. |
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By |
/s/
Adam Chambers |
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Name: |
Adam
Chambers |
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Title: |
President |
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Date: |
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Subscription Amount: |
$2,000,000 |
APPENDIX
A
FORM
OF SENIOR NOTE
THIS
SECURITY HAS NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON
AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY
NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION
FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE
SECURITIES LAWS. THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.
Original
Issue Date: July 8, 2024 |
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Original
Principal Amount: |
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$2,000,000 |
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Final
Maturity Date: July 8, 2025 |
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Interest
Rate: |
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18% |
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QUALIGEN
THERAPEUTICS, INC.
SENIOR
NOTE
THIS
SENIOR NOTE is one of a series of duly authorized and validly issued promissory notes of Qualigen Therapeutics, Inc., a Delaware corporation
(the “Company”), designated as its Senior Notes (this note, this “Note” and, collectively with
the other notes of such series, the “Notes”).
FOR
VALUE RECEIVED, the Company promises to pay to CORBO CAPITAL INC. or its registered assigns (“Holder”), the Original
Principal Amount of this Note as set forth hereinabove (the “Original Principal Amount”) on the Final Maturity Date
set forth hereinabove (the “Final Maturity Date”), or such earlier date as this Note is required or permitted to be
repaid as provided hereunder (as the case may be, the “Maturity Date”), and to pay interest to the Holder in accordance
with the provisions hereof. This Note is subject to the following additional provisions:
Section
1. Definitions. For the purposes hereof, in addition to the terms defined elsewhere in this Note: (a) capitalized terms not otherwise
defined herein shall have the meanings set forth in the Purchase Agreement, and (b) the following terms shall have the following meanings:
“Bankruptcy
Event” means any of the following events: (a) the Company or any Significant Subsidiary (as such term is defined in Rule 1-02(w)
of Regulation S-X) thereof commences a case or other proceeding under any bankruptcy, reorganization, arrangement, adjustment of debt,
relief of debtors, dissolution, insolvency or liquidation or similar law of any jurisdiction relating to the Company or any Significant
Subsidiary thereof, (b) there is commenced against the Company or any Significant Subsidiary thereof any such case or proceeding that
is not dismissed within 60 days after commencement, (c) the Company or any Significant Subsidiary thereof is adjudicated insolvent or
bankrupt or any order of relief or other order approving any such case or proceeding is entered, (d) the Company or any Significant Subsidiary
thereof suffers any appointment of any custodian or the like for it or any substantial part of its property that is not discharged or
stayed within 60 calendar days after such appointment, (e) the Company or any Significant Subsidiary thereof makes a general assignment
for the benefit of creditors, (f) the Company or any Significant Subsidiary thereof calls a meeting of its creditors with a view to arranging
a composition, adjustment or restructuring of its debts, (g) the Company or any Significant Subsidiary thereof admits in writing that
it is generally unable to pay its debts as they become due, (h) the Company or any Significant Subsidiary thereof, by any act or failure
to act, expressly indicates its consent to, approval of or acquiescence in any of the foregoing or takes any corporate or other action
for the purpose of effecting any of the foregoing.
“Business
Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized
or required by law to remain closed; provided, however, for clarification, commercial banks shall not be deemed to be authorized or required
by law to remain closed due to “stay at home”, “shelter-in-place”, “non-essential employee” or any
other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority so
long as the electronic funds transfer systems (including for wire transfers) of commercial banks in The City of New York are generally
are open for use by customers on such day.
“Event
of Default” shall have the meaning set forth in Section 5(a).
“Fundamental
Transaction” shall mean and include any of the following: (i) the merger or consolidation of the Company with or into another
Person; (ii) any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of the Company’s
assets in one or a series of related transactions(including any asset or group of assets, regardless whether then so classified by the
Company, which would constitute a Significant Subsidiary, as such term is defined in Rule 1-02(w) of Regulation S-X), (iii) any, direct
or indirect, purchase offer, tender offer or exchange offer (whether by the Company or another Person) is completed pursuant to which
holders of Common Stock are permitted to sell, tender or exchange their shares for other securities, cash or property and has been accepted
by the holders of 50% or more of the outstanding Common Stock, (iv) the Company, directly or indirectly, in one or more related transactions
effects any reclassification, reorganization or recapitalization of the Common Stock or any compulsory share exchange pursuant to which
the Common Stock is effectively converted into or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly,
in one or more related transactions consummates a stock or share purchase agreement or other business combination (including, without
limitation, a reorganization, recapitalization, spin-off, merger or scheme of arrangement) with another Person or group of Persons whereby
such other Person or group acquires more than 50% of the outstanding shares of Common Stock (not including any shares of Common Stock
held by the other Person or other Persons making or party to, or associated or affiliated with the other Persons making or party to,
such stock or share purchase agreement or other business combination).
“Indebtedness”
means any liabilities of the Company for borrowed money or amounts owed and all guaranties made by the Company of borrowed money or amounts
owed by others.
“New
York Courts” shall have the meaning set forth in Section 6(d).
“Original
Issue Date” means the date of the first issuance of the Notes, regardless of any transfers of any Note and regardless of the
number of instruments which may be issued to evidence such Notes.
“Payment
Amount” means, with respect to any Investor’s Note(s) at any time, the sum of: (1) the outstanding balance of
the Original Principal Amount of this Note at such time, plus (2) all accrued and unpaid interest hereunder, plus (3) all
liquidated damages and other amounts, costs, expenses and/or liquidated damages due under or in respect of this Note, if any.
“Purchase
Agreement” means the Securities Purchase Agreement, dated as of July 5, 2024 by and among the Company and the original holders
of Notes, as amended, modified, or supplemented from time to time in accordance with its terms.
“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
Section
2. Interest and Payment.
(a) The
Original Principal Amount of this Note shall bear interest accruing at eighteen percent (18%) per annum, calculated on the basis of a
360-day year, consisting of twelve 30 calendar day periods, and shall accrue daily commencing on the Original Issue Date until payment
in full of this Note. Accrued interest shall be due and payable on, but not before, the Maturity Date.
(b) On
the Maturity Date, the entire Payment Amount shall become due and payable. The Company may prepay this Note in full at any time after
the Original Issue Date in an amount equal to the Payment Amount.
Section
3. Registration of Transfers and Exchanges.
(a) Different
Denominations. This Note is exchangeable for an equal aggregate Original Principal Amount of Notes of different authorized denominations,
as requested by the Holder surrendering the same. No service charge will be payable for such registration of transfer or exchange.
(b) Investment
Representations. This Note has been issued subject to certain investment representations of the original Holder set forth in the
Purchase Agreement and may be transferred or exchanged only in compliance with the Purchase Agreement and applicable federal and state
securities laws and regulations.
(c) Reliance
on Note Register. Prior to due presentment for transfer to the Company of this Note, the Company and any agent of the Company may
treat the Person in whose name this Note is duly registered on its official registry of Notes as the owner hereof for the purpose of
receiving payment as herein provided and for all other purposes, whether or not this Note is overdue, and neither the Company nor any
such agent shall be affected by notice to the contrary.
Section
4. Negative Covenants. As long as any portion of this Note remains outstanding, unless the holders of a majority in Original
Principal Amount of the then outstanding Notes shall have otherwise given prior written consent, the Company shall not, and shall not
permit any of its Subsidiaries (if any) to, directly or indirectly:
(a) amend
its organization documents, including, without limitation, its certificate of incorporation and bylaws, in any manner that materially
and adversely affects any rights of holders of Notes;
(b) repay,
repurchase or offer to repay, repurchase or otherwise acquire more than a de minimis number of shares of its Common Stock or Common Stock
Equivalents other than (i) as required under the Transaction Documents, (ii) repurchases of Common Stock or Common Stock Equivalents
of departing officers and directors of the Company, provided that such repurchases shall not exceed an aggregate of $25,000 for all officers
and directors during the term of this Note, (iii) repurchases of Common Stock or Common Stock Equivalents, pursuant to existing repurchase
agreements, provided that such repurchases shall not exceed an aggregate of $25,000 during the term of this Note, or (iv) shares of Common
Stock and Common Stock Equivalents which do not vest or are otherwise forfeited, provided (in case of forfeiture) that such Common Stock
and Common Stock Equivalents are not acquired for cash;
(c) repay,
repurchase or offer to repay, repurchase or otherwise acquire any Indebtedness, other than the Notes if on a pro-rata basis, other than
regularly scheduled principal and interest payments as such terms are in effect as of the Original Issue Date; provided that no
Event of Default shall then exist or occur or exist by reason thereof;
(d) pay
cash dividends or distributions on any equity securities of the Company;
(e) enter
into any material transaction with any Affiliate of the Company, unless such transaction is made on an arm’s-length basis and expressly
approved by a majority of the disinterested directors of the Company (even if less than a quorum otherwise required for board approval);
or
(f) enter
into any agreement with respect to any of the foregoing.
Section
5. Events of Default.
(a) “Event
of Default” means, wherever used herein, any of the following events (whatever the reason for such event and whether such event
shall be voluntary or involuntary or effected by operation of law or pursuant to any judgment, decree or order of any court, or any order,
rule or regulation of any administrative or governmental body):
(i) any
default in the payment or prepayment of the Payment Amount as and when the same shall become due and payable (whether on the Maturity
Date, by mandatory prepayment, acceleration or otherwise) which default is not cured within five (5) Business Day;
(ii) any
of the Investor Board Member Nominees shall have been removed from the Board of Directors without the prior written consent of the Holder;
(iii) the
Company shall fail to observe or perform any other covenant or agreement contained in the Notes, which failure is not cured, if possible
to cure, within the earlier to occur of (A) two (2) Business Days after notice of such failure sent by the Holder or by any other Holder
to the Company and (B) five (5) Business Days after the Company has become or should have become aware of such failure;
(iv) (A)
a default or event of default (subject to any grace or cure period provided in the applicable agreement, document or instrument) shall
occur under any of the Transaction Documents, or (B) a default or event of default is declared under any other material agreement, lease,
document or instrument to which the Company or any Subsidiary is obligated (and not covered by clause (vii) below);
(v) any
material representation or warranty made in this Note, any other Transaction Documents, any written statement pursuant hereto or thereto
or any other report, financial statement or certificate made or delivered to the Holder or any other Holder shall be untrue or incorrect
in any material respect as of the date when made;
(vi) the
Company or any Significant Subsidiary (as such term is defined in Rule 1-02(w) of Regulation S-X) shall be subject to a Bankruptcy Event;
(vii) the
Company shall default on any of its obligations under any mortgage, credit agreement or other facility, indenture agreement, capital
lease, factoring agreement or other instrument under which there may be issued, or by which there may be secured or evidenced, any Indebtedness
for borrowed money or money due under any long term leasing or factoring arrangement that (a) involves an obligation greater than $25,000,
whether such Indebtedness now exists or shall hereafter be created, and (b) results in such Indebtedness becoming or being declared due
and payable prior to the date on which it would otherwise become due and payable;
(viii) the
Company shall be a party to any change of control transaction or Fundamental Transaction or shall agree to sell or dispose of all or
in excess of 33% of its assets in one transaction or a series of related transactions (whether or not such sale would constitute a change
of control transaction); or
(ix) a
final non-appealable judgment by any competent court in Canada or the United States for the payment of money in an amount of at least
$25,000 is rendered against the Company, and the same remains undischarged and unpaid for a period of 45 days during which execution
of such judgment is not effectively stayed.
(b) Remedies
Upon Event of Default. If any Event of Default occurs, the Payment Amount of this Note shall become, at the Holder’s election,
immediately due and payable in cash. Upon the payment in full of the Payment Amount in accordance with the terms of this Note, the Holder
shall promptly surrender this Note to or as directed by the Company. In connection with such acceleration described herein, the Holder
need not provide, and the Company hereby waives, any presentment, demand, protest or other notice of any kind, and the Holder may immediately
and without expiration of any grace period enforce any and all of its rights and remedies hereunder and all other remedies available
to it under applicable law. Such acceleration may be rescinded and annulled by Holder at any time prior to payment hereunder and the
Holder shall have all rights as a holder of the Note until such time, if any, as the Holder receives full payment pursuant to this Section
5(b). No such rescission or annulment shall affect any subsequent Event of Default or impair any right consequent thereon.
Section
6. Miscellaneous.
(a) Notices.
Any and all notices or other communications or deliveries to be provided by the Holder hereunder shall be in writing and delivered personally,
by email attachment, or sent by a nationally recognized overnight courier service, addressed to the Company, at the address set forth
on in the Purchase Agreement, or such other, email address, or address as the Company may specify for such purposes by notice to the
Holder delivered in accordance with this Section 6(a). Any and all notices or other communications or deliveries to be provided by the
Company hereunder shall be in writing and delivered personally, by facsimile, by email attachment, or sent by a nationally recognized
overnight courier service addressed to each Holder at the facsimile number, email address or address of the Holder appearing on the books
of the Company, or if no such facsimile number or email attachment or address appears on the books of the Company, at the principal place
of business of such Holder, as set forth in the Purchase Agreement. Any notice or other communication or deliveries hereunder shall be
deemed given and effective on the earliest of: (i) the date of transmission, if such notice or communication is delivered via facsimile
at the facsimile number or email attachment to the email address set forth on the signature pages attached hereto prior to 5:30 p.m.
(Eastern time) on any date, (ii) the next Business Day after the date of transmission, if such notice or communication is delivered via
facsimile at the facsimile number or email attachment to the email address set forth on the signature pages attached hereto on a day
that is not a Business Day or later than 5:30 p.m. (Eastern time) on any Business Day, (iii) the second Business Day following the date
of mailing, if sent by U.S. nationally recognized overnight courier service, or (iv) upon actual receipt by the party to whom such notice
is required to be given.
(b) Absolute
Obligation; Ranking. Except as expressly provided herein, no provision of this Note shall alter or impair the obligation of the Company,
which is absolute and unconditional, to pay the principal of, liquidated damages and accrued interest, as applicable, on this Note at
the time, place, and rate, and in the coin or currency, herein prescribed. This Note is a direct debt obligation of the Company. This
Note is a senior direct debt obligation of the Company that ranks (x) pari passu with all other Notes now or hereafter issued
under the terms of the Purchase Agreement, (y) subordinated to any senior secured bank debt permitted under this Note, and (z) senior
or pari passu with all other Indebtedness of the Company.
(c) Lost
or Mutilated Note. If this Note shall be mutilated, lost, stolen or destroyed, the Company shall execute and deliver, in exchange
and substitution for and upon cancellation of a mutilated Note, or in lieu of or in substitution for a lost, stolen or destroyed Note,
a new Note for the Original Principal Amount of this Note so mutilated, lost, stolen or destroyed, but only upon receipt of evidence
of such loss, theft or destruction of such Note, and of the ownership hereof, reasonably satisfactory to the Company.
(d) Governing
Law. All questions concerning the construction, validity, enforcement and interpretation of this Note shall be governed by and construed
and enforced in accordance with the internal laws of the State of Florida, without regard to the principles of conflict of laws thereof.
Each party agrees that all legal proceedings concerning the interpretation, enforcement and defense of the transactions contemplated
by any of the Transaction Documents (whether brought against a party hereto or its respective Affiliates, directors, officers, shareholders,
employees or agents) shall be commenced exclusively in the state and federal courts sitting in the County of New York, New York (the
“New York Courts”). Each party hereto hereby irrevocably submits to the exclusive jurisdiction of the New York Courts
for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein
(including with respect to the enforcement of any of the Transaction Documents), 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 such New York Courts, or such New
York Courts are improper or inconvenient venue for such proceeding. 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 via registered or certified mail
or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Note 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 other manner permitted by applicable law. Each party hereto hereby irrevocably
waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of
or relating to this Note or the transactions contemplated hereby. If any party shall commence an Action or Proceeding to enforce any
provisions of this Note, then the prevailing party in such Action or Proceeding shall be reimbursed by the other party for its attorney’s
fees and other costs and expenses incurred in the investigation, preparation and prosecution of such Action or Proceeding.
(e) Waiver.
Any waiver by the Company or the Holder of a breach of any provision of this Note shall not operate as or be construed to be a waiver
of any other breach of such provision or of any breach of any other provision of this Note. The failure of the Company or the Holder
to insist upon strict adherence to any term of this Note on one or more occasions shall not be considered a waiver or deprive that party
of the right thereafter to insist upon strict adherence to that term or any other term of this Note on any other occasion. Any waiver
by the Company or the Holder must be in writing.
(f) Severability.
If any provision of this Note is invalid, illegal or unenforceable, the balance of this Note shall remain in effect, and if any provision
is inapplicable to any Person or circumstance, it shall nevertheless remain applicable to all other Persons and circumstances. If it
shall be found that any interest or other amount deemed interest due hereunder violates the applicable law governing usury, the applicable
rate of interest due hereunder shall automatically be lowered to equal the maximum rate of interest permitted under applicable law. The
Company covenants (to the extent that it may lawfully do so) that it shall not at any time insist upon, plead, or in any manner whatsoever
claim or take the benefit or advantage of, any stay, extension or usury law or other law which would prohibit or forgive the Company
from paying all or any portion of the principal of or interest on this Note as contemplated herein, wherever enacted, now or at any time
hereafter in force, or which may affect the covenants or the performance of this Note, and the Company (to the extent it may lawfully
do so) hereby expressly waives all benefits or advantage of any such law, and covenants that it will not, by resort to any such law,
hinder, delay or impede the execution of any power herein granted to the Holder, but will suffer and permit the execution of every such
as though no such law has been enacted.
(g) Remedies,
Characterizations, Other Obligations, Breaches and Injunctive Relief. The remedies provided in this Note shall be cumulative and
in addition to all other remedies available under this Note and any of the other Transaction Documents at law or in equity (including
a decree of specific performance and/or other injunctive relief), and nothing herein shall limit the Holder’s right to pursue actual
and consequential damages for any failure by the Company to comply with the terms of this Note. The Company covenants to the Holder that
there shall be no characterization concerning this instrument other than as expressly provided herein. Amounts set forth or provided
for herein with respect to payments and the like (and the computation thereof) shall be the amounts to be received by the Holder and
shall not, except as expressly provided herein, be subject to any other obligation of the Company (or the performance thereof). The Company
acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Holder and that the remedy at law for
any such breach may be inadequate. The Company therefore agrees that, in the event of any such breach or threatened breach, the Holder
shall be entitled, in addition to all other available remedies, to an injunction restraining any such breach or any such threatened breach,
without the necessity of showing economic loss and without any bond or other security being required. The Company shall provide all information
and documentation to the Holder that is reasonably requested by the Holder to enable the Holder to confirm the Company’s compliance
with the terms and conditions of this Note.
(h) Next
Business Day. Whenever any payment or other obligation hereunder shall be due on a day other than a Business Day, such payment shall
be made on the next succeeding Business Day.
(i) Headings.
The headings contained herein are for convenience only, do not constitute a part of this Note and shall not be deemed to limit or affect
any of the provisions hereof.
Section
7. Amendments; Waivers. Any modifications, amendments or waivers of the provisions hereof shall be subject to Section 5.04
of the Purchase Agreement.
Section
8. Usury. To the extent it may lawfully do so, the Company hereby agrees not to insist upon or plead or in any manner whatsoever
claim and will resist any and all efforts to be compelled to take the benefit or advantage of, usury laws wherever enacted, now
or at any time hereafter in force, in connection with any action or proceeding that may be brought by any Holder in order to enforce
any right or remedy under any Transaction Document. Notwithstanding any provision to the contrary contained in any Transaction Document,
it is expressly agreed and provided that the total liability of the Company under the Transaction Documents for payments in the nature
of interest shall not exceed the maximum lawful rate authorized under applicable law (the “Maximum Rate”), and, without limiting
the foregoing, in no event shall any rate of interest or default interest, or both of them, when aggregated with any other sums in the
nature of interest that the Company may be obligated to pay under the Transaction Documents exceed such Maximum Rate. It is agreed that
if the maximum contract rate of interest allowed by law and applicable to the Transaction Documents is increased or decreased by statute
or any official governmental action subsequent to the date hereof, the new maximum contract rate of interest allowed by law will be the
Maximum Rate applicable to the Transaction Documents from the effective date thereof forward, unless such application is precluded by
applicable law. If under any circumstances whatsoever, interest in excess of the Maximum Rate is paid by the Company to any Holder with
respect to indebtedness evidenced by the Transaction Documents, such excess shall be applied by such Holder to the unpaid principal amount
of any such indebtedness or be refunded to the Company, the manner of handling such excess to be at such Holder’s election.
IN
WITNESS WHEREOF, the Company has caused this Senior Note to be duly executed by a duly authorized officer as of the date first above
indicated.
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QUALIGEN
THERAPEUTICS, INC. |
|
|
|
|
By: |
|
|
Name:
|
Michael
Poirier |
|
Title:
|
Chief
Executive Officer |
v3.24.2
Cover
|
Jul. 05, 2024 |
Cover [Abstract] |
|
Document Type |
8-K
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Amendment Flag |
false
|
Document Period End Date |
Jul. 05, 2024
|
Entity File Number |
001-37428
|
Entity Registrant Name |
Qualigen
Therapeutics, Inc.
|
Entity Central Index Key |
0001460702
|
Entity Tax Identification Number |
26-3474527
|
Entity Incorporation, State or Country Code |
DE
|
Entity Address, Address Line One |
5857
Owens Avenue
|
Entity Address, Address Line Two |
Suite
300
|
Entity Address, City or Town |
Carlsbad
|
Entity Address, State or Province |
CA
|
Entity Address, Postal Zip Code |
92008
|
City Area Code |
(760)
|
Local Phone Number |
452-8111
|
Written Communications |
false
|
Soliciting Material |
false
|
Pre-commencement Tender Offer |
false
|
Pre-commencement Issuer Tender Offer |
false
|
Title of 12(b) Security |
Common
Stock, par value $.001 per share
|
Trading Symbol |
QLGN
|
Security Exchange Name |
NASDAQ
|
Entity Emerging Growth Company |
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