Exhibit 4.1
THIS CONVERTIBLE PROMISSORY NOTE
AND THE UNDERLYING SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”). NO SALE
OR DISPOSITION THEREOF MAY BE EFFECTED EXCEPT IN COMPLIANCE WITH
RULE 144 UNDER SUCH ACT OR AN EFFECTIVE REGISTRATION STATEMENT
RELATED THERETO OR AN OPINION OF COUNSEL FOR THE HOLDER
SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED
UNDER THE ACT OR RECEIPT OF A NO-ACTION LETTER FROM THE U.S.
SECURITIES AND EXCHANGE COMMISSION.
AKESIS PHARMACEUTICALS,
INC.
CONVERTIBLE PROMISSORY
NOTE
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$[
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San Diego, California
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F OR V ALUE R ECEIVED , A KESIS P HARMACEUTICALS , I NC . , a
Nevada corporation (the “Company” ),
hereby unconditionally promises to pay to the order of Avalon
Ventures VII, L.P. (the “Lender” ), in
lawful money of the United States and in immediately available
funds, the principal amount of $ [ —
] (the “Principal
Amount” ), together with accrued and unpaid interest
thereon calculated as set forth in Section 4 hereof
(collectively, the “Loan Balance” ),
which shall be due and payable on the dates and in the manner set
forth in this Convertible Promissory Note (this
“Note” ).
This Note has been issued pursuant
to the terms of that certain Note and Warrant Purchase Agreement,
dated as of September 29, 2008 (the
“Agreement” ), by and between the Company
and Lender.
1. D EFINITIONS . Capitalized terms used and not otherwise defined
herein are intended to have the meanings given to them in the
Agreement. In addition, the following capitalized terms used herein
shall have the following respective meanings:
1.1 “Qualifying
Financing” shall mean the Company’s first preferred
stock financing for capital-raising purposes occurring prior to the
Maturity Date (as defined below) that involves the receipt by the
Company of at least $2,000,000.00 (including any amounts received
in connection with the conversion of any and all Notes issued
pursuant to the Agreement).
1.2 “Qualifying
Financing Shares” shall mean the shares of the Company’s
preferred stock sold and issued to investors in connection with a
Qualifying Financing.
1.3 “Senior
Indebtedness” shall mean the principal of (and premium, if
any) and unpaid interest on, or other payment obligation with
respect to, all indebtedness of the Company pursuant to that
certain Loan and Security Agreement, dated as of December 15,
2006, by and between the Company and Square 1 Bank, whether or not
secured and whether incurred previously or incurred after the date
hereof.
2. M ATURITY D ATE . U nless converted in full pursuant to
Section 5 prior thereto, the Loan Balance shall be due and
payable on February 1, 2009 (the “Maturity
Date” ).
3. P AYMENTS . Payments under this Note shall be made in lawful
money of the United States by wire transfer or other form of
immediately available funds acceptable to Lender at the address of
Lender set forth on the signature page hereto or at such other
place as Lender shall have designated in writing. The Company may
without penalty repay all or any portion of the Loan Balance at any
time prior to the Maturity Date.
4. I NTEREST R ATE . The
Company shall pay interest on the Principal Amount from the date
hereof until payment in full, which interest shall be payable at
the rate of eight percent (8%) per annum or the maximum rate
permissible by law (which under the laws of the State of California
shall be deemed to be the laws relating to permissible rates of
interest on commercial
