<PAGE>
Exhibit 10.1
NEITHER THIS NOTE PURCHASE, THE NOTES ISSUED HEREUNDER NOR THEE
SECURITIES
ISSUABLE UPON CONVERSION OF THE NOTES HAVE BEEN REGISTERED UNDER
THE SECURITIES
ACT OF 1933, AS AMENDED (THE "ACT"), NOR UNDER ANY STATE SECURITIES
LAWS AND
NONE OF THE FOREGOING MAY BE PLEDGED, SOLD, ASSIGNED OR OTHERWISE
TRANSFERRED
UNTIL A (1) REGISTRATION STATEMENT UNDER THE ACT AND ANY APPLICABLE
STATE
SECURITIES LAW HAS BECOME EFFECTIVE WITH RESPECT THERETO, OR (2)
RECEIPT BY THE
COMPANY OF AN OPINION OF COUNSEL TO THE COMPANY TO THE EFFECT THAT
REGISTRATION
UNDER THE ACT OR APPLICABLE STATE SECURITIES LAW IS NOT REQUIRED IN
CONNECTION
WITH THE PROPOSED TRANSFER
AMENDED
AND RESTATED CONVERTIBLE PROMISSORY NOTE PURCHASE AGREEMENT
This AMENDED AND RESTATED CONVERTIBLE PROMISSORY NOTE PURCHASE
AGREEMENT, dated as of May 1, 2007 is made between the purchasers
listed on the
signature pages hereto (each a "PURCHASER" and collectively, the
"Purchasers"),
and BOSTON LIFE SCIENCES, INC., a Delaware corporation (the
"COMPANY").
RECITALS
WHEREAS, the Company entered into that certain Convertible
Promissory
Note Purchase Agreement, dated as of March 22, 2007 (the "ORIGINAL
AGREEMENT")
by and among the Company and certain of the Purchasers (the
"ORIGINAL
CONVERTIBLE NOTE PURCHASERS") pursuant to which the Company issued
to each of
the Original Convertible Note Purchasers a convertible promissory
note
(collectively, the "ORIGINAL NOTES") which notes are in the form
attached hereto
as Exhibit A, and the Company obtained the right to borrow up to
$15,000,000
(the "TOTAL ADVANCE AMOUNT") from the Original Convertible Note
Purchasers;
WHEREAS, as of the date hereof, the Company has borrowed $9,000,000
of
the Total Advance Amount from the Original Convertible Note
Purchasers (the
"CURRENT AMOUNT ADVANCED");
WHEREAS, the the Company has agreed not to request, and the
Original
Convertible Note Purchasers have agreed not to make, any further
Advances (as
defined in the Original Agreement);
WHEREAS, Highbridge International LLC ("HIGHBRIDGE"), a
Purchaser,
wishes to purchase from the Company and the Company wishes to sell
to
Highbridge, a convertible promissory note in the form attached
hereto as Exhibit
A, in the aggregate principal amount of $6,000,000 (the "HIGHBRIDGE
NOTE");
WHEREAS, the Company requires certain funds for the operation of
its
business; and
WHEREAS, the Highbridge is willing to provide the Company with
such
funds through the purchase of the Highbridge Note on the terms and
conditions
hereafter provided;
NOW, THEREFORE, in order to induce Highbridge to purchase the
Convertible Notes and for other good and valuable consideration,
the receipt and
adequacy of which are hereby acknowledged, and intending to be
legally bound,
the Purchasers and the Company hereby agree as follows:
<PAGE>
1.
DEFINED TERMS. When used in this Agreement the following terms
shall have the following meanings (such meanings being equally
applicable to
both the singular and plural forms of the terms defined):
"AFFILIATES" shall mean any corporation, company, partnership,
joint
venture and/or firm that controls, is controlled by, or is under
common control
with the Company. For purposes of this definition, "control" shall
mean (a) in
the case of corporate entities, direct or indirect ownership of at
least fifty
percent (50%) of the stock or shares having the right to vote for
the election
of directors and (b) in the case of non-corporate entities, direct
or indirect
ownership of at least fifty percent (50%) of the equity interest
with the power
to direct the management and policies of such non-corporate
entities.
"AGREEMENT" means this Amended and Restated Convertible Promissory
Note
Purchase Agreement, as it may be amended or modified and in effect
from time to
time.
"BUSINESS DAY" means any day other than a Saturday, Sunday, or
other
day on which commercial banks in the Commonwealth of Massachusetts
are
authorized or required to close.
"COMMON STOCK" means the common stock, $0.01 par value per share,
of
the Company.
"CONVERTIBLE NOTES" shall mean, collectively, the Original Notes
and
the Highbridge Notes.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
"EVENT OF DEFAULT" shall have the meaning assigned to such term
in
Article IX hereof.
"FIRST COMMERCIAL SALE" shall mean, with respect to each
Molecular
Imaging Product, the first commercial sale in a country as part of
a nationwide
introduction by the Company, its Affiliates or its or its
Affiliates' licensees
or sublicensees.
"HIGHEST LAWFUL RATE" means the maximum lawful interest rate, if
any,
that at any time or from time to time may be contracted for,
charged, or
received under the laws applicable to the Purchasers which are
presently in
effect or, to the extent allowed by law, under such applicable laws
which allow
a higher maximum nonusurious interest rate than applicable laws now
allow.
"LOAN DOCUMENTS" means collectively, this Agreement and the
Convertible
Notes.
"MATURITY DATE" means the earliest to occur of (a) December 31,
2010
and (b) the date on which a Purchaser declares a Default (as
defined in Section
9 below) to have occurred.
"MOLECULAR IMAGING PRODUCTS" shall mean products approved for sale
by
the appropriate U.S. and/or foreign regulatory body containing as
the active
ingredient the Company's radio-labeled molecular imaging agents,
currently in
development or developed by the Company in the future, including,
without
limitation, the ALTROPANE(R) and FLUORATEC molecular imaging
agents, for the
diagnosis and monitoring of Parkinson's Disease and Attention
Deficit
Hyperactivity Disorder using SPECT or PET camera imaging
techniques.
"NET SALES" shall mean the gross amount received by the Company,
its
Affiliates and/or its or its Affiliates' licensees or sublicensees
on sales or
other dispositions of Molecular Imaging Products to Third
-2-
<PAGE>
Parties (other than licensees or sublicensees) in bona fide,
arm's-length
transactions, less the following deductions:
(a) Trade,
cash and/or quantity discounts actually allowed and
taken directly with respect to such sales, as reflected in the
amount invoiced;
(b) Tariffs,
duties, excises, sales taxes or other taxes imposed
upon and paid directly by the Company with respect to the
production, sale,
delivery or use of the Molecular Imaging Product (excluding
national, state or
local taxes based on income), as reflected in the amount
invoiced;
(c) Amounts
repaid or credited by reason of rejections, defects,
recalls or returns, or because of chargebacks, refunds, rebates,
retroactive
price reductions or delayed ship orders;
(d) Amounts
credited for uncollectible amounts on previously sold
products;
(e) Freight,
insurance and other transportation charges incurred
in shipping a Molecular Imaging Product to Third Parties, as
reflected in the
amount invoiced;
(f) Deduction
of one percent (1%) for distribution and warehousing
expenses; and
(g) Any other
reduction or specifically identifiable amounts
included in the gross invoice that are creditable for reasons
substantially
equivalent to those listed above.
Notwithstanding anything in this Agreement to the contrary, "NET
SALES"
shall exclude any sales or other disposition of Molecular Imaging
Products for
test marketing, clinical trial purposes or compassionate or similar
use.
Net Sales amounts shall be determined from the books and records of
the
Company, its Affiliates and/or its or its Affiliates' licensees or
sublicensees,
maintained in accordance with generally accepted accounting
principles,
consistently applied.
Sales between or among the Company, its Affiliates or their
respective
licensees and sublicensees shall be disregarded for purposes of
calculating Net
Sales. In the case of any sale or other disposal of a Molecular
Imaging Product
between or among the Company and its Affiliates, licensees and
sublicensees, for
resale, Net Sales shall be calculated as above only on the value
charged or
invoiced on the first arm's-length sale thereafter to a Third
Party.
In the case of any sale or other disposal for value, such as barter
or
counter-trade, of any Molecular Imaging Product, or part thereof,
other than in
an arm's-length transaction exclusively for money, Net Sales shall
be calculated
as above on the value of the non-cash consideration received or the
fair market
price (if higher) of the Molecular Imaging Product in the country
of sale or
disposal.
In the event the Molecular Imaging Product is sold in a finished
dosage
form in combination with one or more other active ingredients (a
"COMBINATION
PRODUCT"), the Net Sales of the Molecular Imaging Product, for the
purposes of
determining royalty payments, shall be determined by multiplying
the Net Sales
(as defined above) of the Combination Product by the fraction,
'A/(A+B)' where
'A' is the weighted (by sales volume) average sale price in the
relevant country
of the Molecular Imaging Product when sold separately in finished
form and 'B'
is the weighted average sale price in that country of the other
product(s) sold
separately in finished form. In the event that such average sale
price cannot be
-3-
<PAGE>
determined for both the Molecular Imaging Product and the other
product(s) in
the Combination Product, Net Sales for purposes of determining
royalty payments
shall be agreed by the Parties based on the relative value
contributed by each
component, such agreement not to be unreasonably withheld.
"OBLIGATIONS" means all unpaid principal of and accrued and
unpaid
interest on the Convertible Notes, and all other obligations,
interest, fees,
charges and expenses of the Company to the Purchasers arising under
the Loan
Documents.
"PRE-COMMERCIAL INCOME" shall mean, with respect to each
Molecular
Imaging Product, all license fees, milestone payments and other
amounts received
by the Company and/or its Affiliates from Third Parties in
connection with or
related to the licensing or sublicensing to such Third Parties of
the Company's
and/or its Affiliate's rights under the intellectual property
covering the
Molecular Imaging Product. Notwithstanding anything in the
foregoing to the
contrary, "Pre-Commercial Income" shall exclude (a) any royalty
payments or
milestone payments based upon commercial sales levels, (b) amounts
received for
research and development activities undertaken for, or in
collaboration with,
such Third Parties, (c) amounts received for debt or equity
securities of the
Company and/or its Affiliates, provided that any amounts received
in excess of
the then current fair market value of such debt or equity
securities shall, to
the extent of such excess, be deemed to be Pre-Commercial Income,
and (d)
transfer pricing amounts paid in respect of Molecular Imaging
Products supplied
to such Third Parties.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"THIRD PARTY" shall mean any person or entity other than the
Company or
any of its Affiliates.
"VALID CLAIM" means a claim of any issued, unexpired United States
or
foreign patent, which shall not be disclaimed, nor held invalid or
unenforceable
by a court of competent jurisdiction in an unappealed or
unappealable decision.
2.
CONVERTIBLE NOTE FACILITY.
2.1 PURCHASE
AND SALE OF CONVERTIBLE NOTES. At the
Closing (as defined below), Highbridge agrees on the terms of and
subject to the
conditions specified in this Agreement, to purchase from the
Company, and the
Company agrees to sell to Highbridge, the Highbridge Note.
2.2 ADVANCES.
The Original Convertible Purchasers agree
that they will make no further Advances to the Company and the
Company agrees
that it shall make no further requests for Advances from the
Original
Convertible Note Purchasers.
2.3 CLOSING.
The closing of the issuance and sale of the
Highbridge Note issued hereunder shall be held at the offices of
counsel to the
Company at 5:00 p.m. on the date and time as is mutually agreed to
by the
Company and the Purchasers (such date, the "CLOSING").
2.4 PAYMENT OF
CONVERTIBLE NOTE PURCHASE PRICE. At the
Closing, (i) the Company shall deliver to Highbridge the Highbridge
Note, and
(ii) as payment in full for the Highbridge Note being purchased by
Highbridge at
the Closing, Highbridge shall pay its purchase amount (which amount
shall be
$6,000,000 less the amounts withheld pursuant to Section 11.2) to
the Company by
wire transfer of immediately available funds to an account
designated by the
Company.
-4-
<PAGE>
2.5 INTEREST.
Interest shall accrue on each Convertible
Note from the date of issuance until such Convertible Note is paid
in full or
otherwise converted pursuant to Section 4 hereof. The Company
promises to pay
interest on the outstanding principal amount of each Convertible
Note (i) until
the Maturity Date, or if earlier, conversion pursuant to Section 4
hereof, at a
per annum interest rate equal to five percent (5%), (ii) from and
after the
Maturity Date, or during the continuance of an Event of Default, at
a per annum
rate equal to ten percent (10%) or (iii) if less than the rates
applicable under
both clauses (i) and (ii), the Highest Lawful Rate. Interest shall
be calculated
on the basis of a 360-day year for the actual number of days
elapsed. Interest
shall accrue until paid in full and all unpaid interest shall be
due and payable
on the Maturity Date, unless otherwise converted pursuant to
Section 4 hereof.
2.6 METHOD OF
PAYMENT. All payments of principal,
interest, and fees hereunder shall be made on the date when due in
immediately
available funds in United States Dollars to the Purchasers at the
Purchaser's
address specified on the signature page hereof, or at such other
address as
shall be directed by the applicable Purchaser in a writing received
by the
Company.
2.7
PREPAYMENTS. The Company may not prepay any amounts
under any Convertible Notes whether principal or interest.
2.8 USURY
SAVINGS CLAUSE. Notwithstanding any other
provision herein, the aggregate interest rate charged with respect
to any of the
Obligations, shall not exceed the Highest Lawful Rate. If the rate
of interest
(determined without regard to the preceding sentence) under this
Agreement at
any time exceeds the Highest Lawful Rate, the outstanding amount
under the
Convertible Notes issued hereunder shall bear interest at the
Highest Lawful
Rate until the total amount of interest due hereunder equals the
amount of
interest which would have been due hereunder if the stated rates of
interest set
forth in this Agreement had at all times been in effect. In
addition, if when
the Convertible Notes issued hereunder are repaid in full the total
interest due
hereunder is less than the total amount of interest which would
have been due
hereunder if the stated rates of interest set forth in this
Agreement had at all
times been in effect, then to the extent permitted by law, the
Company shall pay
to Purchasers an amount equal to the difference between the amount
of interest
paid and the amount of interest which would have been paid if the
Highest Lawful
Rate had at all times been in effect. Notwithstanding the
foregoing, it is the
intention of Purchasers and the Company to conform strictly to any
applicable
usury laws. Accordingly, if the Purchasers contract for, charge, or
receive any
consideration which constitutes interest in excess of the Highest
Lawful Rate,
then any such excess shall be cancelled automatically and, if
previously paid,
shall be applied to the outstanding principal amount of the
Convertible Notes
issued hereunder or be refunded to the Company.
3.
CONDITIONS PRECEDENT. The obligations of Highbridge to
purchase the Highbridge Note shall be subject to the following
conditions
precedent that on the date of the Closing:
3.1 Each of
the representations and warranties of the
Company contained in this Agreement and the Loan Documents shall be
true and
correct in all material respects; and
3.2 At the
time of, and immediately after giving effect
to, the issuance of such Highbridge Note, no Event of Default shall
have
occurred and be continuing.
4.
OPTIONAL CONVERSION.
4.1 CONVERSION
TO EQUITY.
-5-
<PAGE>
(a) After
December 31, 2007, at any time during which
Convertible Notes remain outstanding, up to all of the outstanding
principal and
accrued interest under any particular Convertible Note then
outstanding may be
converted, at the sole option of the holder thereof and by written
notice to the
Company, into shares of Common Stock of the Company at a conversion
price equal
to $2.50 per share.
(b)
Notwithstanding anything to the contrary contained
herein, each Purchaser shall be prohibited from effecting a
conversion pursuant
to this Section 4.1 if at the time of such conversion (i) the
Common Stock
issuable to such Purchaser pursuant to such conversion or as a
result of such
conversion, when taken together with all shares of Common Stock
then held or
otherwise beneficially owned by such Purchaser exceeds 19.9% of the
total number
of issued and outstanding shares of Common Stock of the Company
immediately
prior to such conversion, (ii) the Common Stock issuable to such
Purchaser
pursuant to such conversion or as a result of such conversion,
exceeds 19.9% of
the total number of issued and outstanding shares of Common Stock
of the Company
immediately prior to such conversion, in each case unless and until
the
stockholders of the Company approve the conversion of all of the
shares of
Common Stock issuable hereunder and the transactions contemplated
hereby
pursuant to Nasdaq Marketplace Rule 4350(i)(1)(D)(ii) and any other
applicable
rules and regulations ("STOCKHOLDER APPROVAL"). The forgoing
provision however
shall not restrict the number of shares of Common Stock which the
Purchaser may
receive or beneficially own in order to determine the amount of
securities or
other consideration that such Purchaser may receive in the event of
a merger,
sale or other business combination involving the Company.
(c) The
Company hereby covenants and agrees that (i) in
the event a Purchaser is prohibited from effecting a conversion of
Convertible
Notes pursuant to this Section 4.1, then upon receipt of written
notice of such
event from such Purchaser, the Company shall use its best efforts
to seek
Stockholder Approval and (ii) upon any conversion pursuant to this
Section 4.1,
the Company shall use its best efforts to effect an amendment to
that certain
Amended and Restated Registration Rights Agreement, dated March 9,
2005, as
amended (the "REGISTRATION AGREEMENT"), to cause any shares of
Common Stock
issuable in connection with such conversion to be included as
Registrable
Securities in the Registration Agreement.
(d)
Notwithstanding anything to the contrary contained
herein, the Company shall not effect any conversion of this Note,
and Highbridge
and any of its affiliates shall not have the right to effect any
conversion
pursuant to this Section 4.1, to the extent that after giving
effect to such
conversion, Highbridge (together with its affiliates and any other
person or
entity acting as a group together with Highbridge), would
beneficially own in
excess of 9.99% of the number of shares of the Common Stock
outstanding
immediately after giving effect to the issuance of shares of Common
Stock
issuable upon any such conversion. For purpos
