Exhibit 10.1

 

NOTE PURCHASE AGREEMENT

 

This Note Purchase Agreement, dated as of February 6, 2017 (this “Agreement”),
is entered into by and between Bone Biologics Corporation, a Delaware
corporation, (the “Company”) and Hankey Capital, LLC (“HIC”) and The
Musculoskeletal Transplant Foundation (“MTF”) (each an “Investor” and
collectively the “Investors”).

 

RECITALS

 

A. The Company is offering an aggregate of $2,000,000 principal amount of its
secured convertible promissory notes (each, a “Note” and collectively, the
“Notes”).

 

B. On the terms and subject to the conditions set forth herein, each Investor is
willing to purchase from the Company, and the Company is willing to sell to
Investor, a Note in the principal amount of $1,000,000 (the “Purchase Price”).

 

C. Capitalized terms not otherwise defined herein shall have the meaning set
forth in the Note.

 

AGREEMENT

 

NOW THEREFORE, in consideration of the foregoing, and the representations,
warranties, and conditions set forth below, the parties hereto, intending to be
legally bound, hereby agree as follows:

 

1. The Notes.

 

(a) Issuance of Notes. Subject to all of the terms and conditions hereof, the
Company agrees to issue and sell to each Investor, and each Investor agrees to
purchase, a Note in the principal amount of the Purchase Price.

 

(b) Delivery. The sale and purchase of the Note shall take place at a closing
(the “Closing”) to be held at such place and time as the Company and the
Investors may determine following satisfaction or waiver of the conditions set
forth herein (the “Closing Date”). At the Closing, the Company will deliver to
each Investor a Note against receipt by the Company of the Purchase Price in
immediately available funds.

 

(c) Use of Proceeds. The proceeds of the sale and issuance of the Notes shall be
used to focus on prioritizing operations on essential research and development
activities. For avoidance of doubt, no cash payments may be made pursuant to
those certain Professional Service Agreements between the Company and each of
Chia Soo, Kang Ting and Ben Wu (the “Founders”).

 

(d) Payments. The Company will make all cash payments due under the Notes in
immediately available funds by 1:00 p.m. eastern time on the date such payments
are due.

 

2. Representations and Warranties of the Company. The Company represents and
warrants to each Investor that:

 

(a) Due Incorporation, Qualification, etc. The Company (i) is a corporation duly
incorporated, and is validly existing under, the laws of the state of Delaware;
(ii) has the power and authority to own, lease and operate its properties and
carry on its business as now conducted; and (iii) is duly qualified, licensed to
do business and in good standing as a foreign entity in each jurisdiction where
the failure to be so qualified or licensed could reasonably be expected to have
a material adverse effect on the Company.

 

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(b) Authority. The execution, delivery and performance by the Company of this
Agreement and the Notes (collectively, the “Loan Documents”) and the
consummation of the transactions contemplated thereby (i) are within the power
of the Company and (ii) have been duly authorized by all necessary actions on
the part of the Company.

 

(c) Enforceability. The Loan Documents have been duly executed and delivered by
the Company and constitute, or will constitute, a legal, valid and binding
obligation of the Company, enforceable against the Company in accordance with
their terms, except as limited by bankruptcy, insolvency or other laws of
general application relating to or affecting the enforcement of creditors’
rights generally and general principles of equity.

 

(d) Non-Contravention. The execution and delivery by the Company of the Loan
Documents and the performance and consummation of the transactions contemplated
thereby do not and will not (i) violate the Company’s Certificate of
Incorporation or By-Laws (as amended, the “Charter Documents”) or any material
judgment, order, writ, decree, statute, rule or regulation applicable to the
Company; (ii) violate any provision of, or result in the breach or the
acceleration of, or entitle any other Person to accelerate (whether after the
giving of notice or lapse of time or both), any material mortgage, indenture,
agreement, instrument or contract to which the Company is a party or by which it
is bound; or (iii) other than the security interest created upon issuance of the
Notes, result in the creation or imposition of any lien upon any property, asset
or revenue of the Company or the suspension, revocation, impairment, forfeiture,
or nonrenewal of any material permit, license, authorization or approval
applicable to the Company, its business or operations, or any of its assets or
properties.

 

(e) Approvals. No consent, approval, order or authorization of, or registration,
declaration or filing with, any governmental authority or other Person is
required in connection with the execution and delivery of this Agreement or the
Notes and the performance and consummation of the transactions contemplated
thereby, other than such as have been obtained and remain in full force and
effect and other than such qualifications or filings under applicable securities
laws as may be required in connection with the transactions contemplated by this
Agreement.

 

(f) No Violation or Default. To the knowledge of the Company, it is not in
violation of or in default with respect to (i) its Charter Documents or any
material judgment, order, writ, decree, statute, rule or regulation applicable
to it; or (ii) any material mortgage, indenture, agreement, instrument or
contract to which the Company is a party or by which it is bound (nor is there
any waiver in effect which, if not in effect, would result in such a violation
or default), where, in each case, such violation or default, individually, or
together with all such violations or defaults, could reasonably be expected to
have a material adverse effect on the Company.

 

(g) Intellectual Property. To its knowledge, the Company owns or possesses (or
can obtain on commercially reasonable terms) sufficient legal rights to all
patents, trademarks, service marks, trade names, copyrights, trade secrets,
licenses, information, processes and other intellectual property rights
necessary for its business as now conducted and as proposed to be conducted,
without any conflict with, or infringement of the rights of, others.

 

(h) Accuracy of Information Furnished. The Company has given Investor access to
the corporate records and accounts of the Company and to all information in its
possession relating to the Company, has made its officers and representatives
available for interview by the Investor, and has furnished such Investor with
all documents and other information required for the Investor to make an
informed decision with respect to the purchase of the Notes. Neither the Loan
Documents nor any of the other certificates, statements or information furnished
to Investors by or on behalf of the Company in connection with the transactions
contemplated thereby contains or will contain any untrue statement of a material
fact or omits or will omit to state a material fact necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading.

 

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3. Representations and Warranties of Each Investor. Each Investor represents and
warrants to the Company upon the acquisition of a Note as follows:

 

(a) Binding Obligation. Investor has full legal capacity, power and authority to
execute and deliver this Agreement and to perform its obligations hereunder. The
Loan Documents constitute valid and binding obligations of Investor, enforceable
in accordance with their terms, except as limited by bankruptcy, insolvency or
other laws of general application relating to or affecting the enforcement of
creditors’ rights generally and general principles of equity.

 

(b) Securities Law Compliance. Investor has been advised that the Notes and the
underlying securities have not been registered under the Securities Act of 1933,
as amended (the “Securities Act”), or any state securities laws and, therefore,
cannot be resold unless they are registered under the Securities Act and
applicable state securities laws or unless an exemption from such registration
requirements is available. Investor is aware that the Company is under no
obligation to effect any such registration with respect to the Notes or the
underlying securities or to file for or comply with any exemption from
registration. Investor has not been formed solely for the purpose of making this
investment and is purchasing the Notes for its own account for investment, not
as a nominee or agent, and not with a view to, or for resale in connection with,
the distribution thereof, and Investor has no present intention of selling,
granting any participation in, or otherwise distributing the same. Investor has
such knowledge and experience in financial and business matters that Investor is
capable of evaluating the merits and risks of such investment, is able to incur
a complete loss of such investment without impairing Investor’s financial
condition and is able to bear the economic risk of such investment for an
indefinite period of time. Investor is an accredited investor as such term is
defined in Rule 501 of Regulation D under the Securities Act and shall submit to
the Company such further assurances of such status as may be reasonably
requested by the Company.

 

4. Conditions to Closing of the Investors. Each Investor’s obligations at the
Closing are subject to the fulfillment, on or prior to the Closing Date, of all
of the following conditions, any of which may be waived in whole or in part by
all of such Investor:

 

(a) Representations and Warranties. The representations and warranties made by
the Company in Section 2 hereof shall have been true and correct when made, and
shall be true and correct on the Closing Date.

 

(b) Governmental Approvals and Filings. Except for any notices required or
permitted to be filed after the Closing Date with certain federal and state
securities commissions, the Company shall have obtained all governmental
approvals required in connection with the lawful sale and issuance of the Note.

 

(c) Transaction Documents. The Company shall have duly executed and delivered to
the Investor the Loan Documents.

 

(d) Funding. The Company shall have received an aggregate amount of $2,000,000
from the Investors.

 

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5. Conditions to Obligations of the Company. The Company’s obligation to issue
and sell the Notes at the Closing is subject to the fulfillment, on or prior to
the Closing Date, of the following conditions, any of which may be waived in
whole or in part by the Company:

 

(a) Representations and Warranties. The representations and warranties made by
the Investors in Section 3 hereof shall be true and correct when made, and shall
be true and correct on the Closing Date.

 

(b) Governmental Approvals and Filings. Except for any notices required or
permitted to be filed after the Closing Date with certain federal and state
securities commissions, the Company shall have obtained all governmental
approvals required in connection with the lawful sale and issuance of the Notes.

 

(c) Purchase Price. Each Investor shall have delivered to the Company the
Purchase Price in respect of the Note being purchased by such Investor
referenced in Section 1(b) hereof.

 

6. Covenants of the Company. From the date of Closing through the earliest to
occur of the Maturity Date or the Mandatory Conversion of the Notes, the Company
agrees as follows:

 

(a) The Company shall take all necessary steps to (i) focus on prioritizing
operations on essential research and development activities, (ii) complete any
existing ongoing studies, (iii) continue to seek outside funding and (iv) file
all required documents with the Securities and Exchange Commission.

 

(b) Within ninety days of the Closing, the Company will investigate and report
to its board of directors the potential benefits and disadvantages of taking the
Company private.

 

(c) The Company shall not enter into any new agreements with any Founder which
requires the Company to make cash payments or provide cash compensation to any
Founder until such time as the Company has received at least $10,000,000 in
gross proceeds from funding from non-current stockholders.

 

7. Miscellaneous.

 

(a) Waivers and Amendments. Any provision of this Agreement and the Notes may be
amended, waived or modified only upon the written consent of the Company and the
Investors.

 

(b) Governing Law. This Agreement and all actions arising out of or in
connection with this Agreement shall be governed by and construed in accordance
with the laws of the State of California, without regard to the conflicts of law
provisions of the State of California or of any other state.

 

(c) Survival. The representations, warranties, covenants and agreements made
herein shall survive the execution and delivery of this Agreement.

 

(d) Successors and Assigns. Subject to the restrictions on transfer described in
Sections 7(e) below, the rights and obligations of the Company and the Investor
shall be binding upon and benefit the successors, assigns, heirs, administrators
and transferees of the parties.

 

(e) Assignment by the Company. The rights, interests or obligations hereunder
may not be assigned, by operation of law or otherwise, in whole or in part, by
the Company without the prior written consent of the Investors. Any such
impermissible assignment shall be void.

 

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(f) Entire Agreement. This Agreement together with the other Loan Documents
constitute and contain the entire agreement among the Company and Investor and
supersede any and all prior agreements, negotiations, correspondence,
understandings and communications among the parties, whether written or oral,
respecting the subject matter hereof.

 

(g) Notices. All notices, requests, demands, consents, instructions or other
communications required or permitted hereunder shall in writing and faxed,
mailed or delivered to each party as follows: (i) if to an Investor, at such
Investor’s address or facsimile number set forth in Schedule I, or at such other
address as such Investor shall have furnished the Company in writing, or (ii) if
to the Company, at the Company’s address or facsimile number set forth on the
signature page to this Agreement, or at such other address or facsimile number
as the Company shall have furnished to the Investor in writing. All such notices
and communications will be deemed effectively given the earlier of (i) when
received, (ii) when delivered personally, (iii) one business day after being
delivered by facsimile (with receipt of appropriate confirmation), (iv) one
business day after being deposited with an overnight courier service of
recognized standing or (v) four days after being deposited in the U.S. mail,
first class with postage prepaid.

 

(h) Counterparts. This Agreement may be executed in one or more counterparts,
each of which will be deemed an original, but all of which together will
constitute one and the same agreement. Facsimile copies of signed signature
pages will be deemed binding originals.

 

(Signature Page Follows)

 

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The parties have caused this Agreement to be duly executed and delivered by
their proper and duly authorized officers as of the date first written above.

 

  INVESTORS:         The Musculoskeletal Transplant Foundation   Name of
Investor         By:     Name:     Title:           Hankey Capital, LLC   Name
of Investor         By:     Name:     Title:           COMPANY:         Bone
Biologics Corporation         By:     Name:       Authorized Signatory   Title:
 

 

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