Exhibit 10.1

 

FIRST AMENDMENT TO
 NOTE PURCHASE AGREEMENT AND NOTES

 

This FIRST AMENDMENT TO NOTE PURCHASE AGREEMENT AND NOTES (this “Amendment”),
dated as of December 29, 2017, by and among Napo Pharmaceuticals, Inc., a
Delaware Corporation (“Napo” or the “Company”) and each party identified on the
signature pages hereto as a purchaser of the Notes (as defined below) pursuant
to the Note Purchase Agreement (as defined below) (collectively, the
“Purchasers” and each, a “Purchaser”).

 

W I T N E S S E T H :

 

WHEREAS, the Company and the Purchasers are parties to that certain Note
Purchase Agreement dated as of March 1, 2017 (the “Note Purchase Agreement”),
pursuant to which the Company issued $1,312,500 in aggregate principal amount of
Original Issue Discount Exchangeable Promissory Notes to the Purchasers at a
purchase price of $1,050,000 (collectively, the “Original Notes”).

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants,
representations, warranties and agreements contained herein, and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

 

1.             Definitions.  Capitalized terms used and not otherwise defined
herein shall have the same meanings as set forth in the Note Purchase Agreement.

 

2.             Amendments to Note Purchase Agreement.

 

a.  Section 1.1 of the Note Purchase Agreement is hereby amended by deleting the
definitions of “Initial Exchange Shares” and “Subsequent Exchange Shares” in
their entirety and substituting with the following:

 

“Conversion Price” means $0.20 per share, to be appropriately adjusted for any
share dividend, share split, share combination, reclassification or similar
transaction that proportionately decreases or increases the Jaguar Common Stock.

 

“Initial Exchange Shares” means the shares of Jaguar Common Stock issuable upon
exchange of the Notes issued at the Initial Closing, which shall be determined
by dividing (x) the outstanding principal amount of Notes issued at the Initial
Closing plus accrued and unpaid interest thereon by (y) the Conversion Price.

 

“Redemption Shares” means 2,492,084 shares of Jaguar Common Stock issued on
December 29, 2017 as partial redemption of the Notes issued at the Initial
Closing.

 

“Subsequent Exchange Shares” means the shares of Jaguar Common Stock issuable
upon exchange of the Notes issued at the Subsequent Closing, which shall be
determined by dividing (x) the outstanding principal amount of Notes issued at
the Subsequent Closing plus accrued and unpaid interest thereon by (y) the
Conversion Price; provided,

 

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however, that such term means 866,071 shares of Jaguar Common Stock on an
as-exchanged basis (to be appropriately adjusted for any share dividend, share
split, share combination, reclassification or similar transaction that
proportionately decreases or increases the Jaguar Common Stock) upon the
occurrence of the Merger Termination Date.

 

b.  Section 2.2 of the Note Purchase Agreement is hereby amended by deleting
Section 2.2 in its entirety and replacing with the following:

 

“2.2  Initial Closing. Subject to the terms and conditions set forth herein, at
the Initial Closing (as defined below), Napo shall sell to the Purchasers, and
the Purchasers shall (severally, and not jointly) purchase from Napo, Notes
having an aggregate original principal amount of Four Hundred Thirty Five
Thousand Nine Hundred Forty Nine Dollars and Ninety Two Cents ($435,949.92) to
be allocated as set forth on Exhibit B attached hereto for an aggregate purchase
price of Five Hundred Twenty Five Thousand Dollars ($525,000), which shall be
payable by wire transfer of immediately available funds. The initial closing of
the transactions contemplated hereunder (the “Initial Closing”) shall take place
simultaneously with the execution and delivery hereof at the offices of Reed
Smith LLP, 101 Second Street, Suite 1800, San Francisco, CA 94105 or such other
date and place as may be mutually agreed to in writing by the parties. At the
Initial Closing, the applicable parties thereto will enter into the other
Transaction Documents.

 

c.  Section 2.3 of the Note Purchase Agreement is hereby amended by deleting
Section 4.13 in its entirety and replacing with the following:

 

“2.3 Subsequent Closing. Following the Initial Closing, each Purchaser shall
(severally, and not jointly) purchase its Pro Rata Portion of additional Notes
with an aggregate original principal amount of Seven Hundred Thirty Five
Thousand Dollars ($735,000) for an aggregate purchase price of Five Hundred
Twenty Five Thousand Dollars ($525,000) subject to the terms and conditions of
such purchase being mutually satisfactory to the Company and the Purchasers and
that in no event shall, after giving effect to any such sale, the aggregate
outstanding original principal amount of all Notes exceed the Maximum Principal
Amount (the “Subsequent Closing”), and provided further that each Purchaser
shall be offered terms in respect of its participation in Subsequent
Closing(s) which are at least as favorable as the terms applicable to any other
purchaser (a “Subsequent Purchaser”) in the Subsequent Closing. Following such
Subsequent Closing, Exhibit B hereto shall be amended to include the Notes
purchased by the applicable Purchasers at such Subsequent Closing. The
Subsequent Closing shall be on a date mutually satisfactory to the Company and
the Purchasers; provided, however, such date shall take place no later than the
earlier of the Merger Effective Date or the Merger Termination Date.”

 

d.  Section 4.13 of the Note Purchase Agreement is hereby amended by deleting
Section 4.13 in its entirety and replacing with the following:

 

“4.13. Registration of Exchange Shares. Consistent with the terms set forth in
Annex II to this Agreement, Napo shall cause Jaguar to register the maximum
number of Initial Exchange Shares and Subsequent Exchange Shares with the SEC.”

 

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e.  Section 5 of the Note Purchase Agreement is hereby amended as follows:

 

i.  Deleting Section 5.5 in its entirety and replacing with the following:

 

“5.5.  [Reserved].”

 

ii.  Adding the following as Section 5.6 of the Note Purchase Agreement:

 

“5.6  Compliance with Nasdaq Rules.  Notwithstanding anything in this Agreement
to the contrary, the total number of shares of Jaguar Common Stock that may be
issued under this Agreement shall be limited to 13,533,360 shares (the “Exchange
Cap”), which equals 19.99% of the Company’s outstanding shares of Jaguar Common
Stock as of July 31, 2017, unless stockholder approval is obtained to issue more
than such 19.99%. The Exchange Cap shall be appropriately adjusted for any stock
dividend, stock split, reverse stock split or similar transaction. The foregoing
limitation shall not apply if stockholder approval has not been obtained and at
any time the Exchange Cap is reached and at all times thereafter the average
price paid for all shares of Jaguar Common Stock issued under this Agreement is
equal to or greater than $0.56 (the “Minimum Price”), a price equal to the last
closing trade price for Jaguar Common Stock on Nasdaq on July 31, 2017 (in such
circumstance, for purposes of Nasdaq, the transaction contemplated hereby would
not be “below market” and the Exchange Cap would not apply). Notwithstanding the
foregoing, the Company shall not be required or permitted to issue, and the
Purchasers will not be permitted to exchange the Notes for, any shares of Jaguar
Common Stock under this Agreement if such issuance would violate the rules or
regulations of Nasdaq.”

 

f. Section 7.5 of the Note Purchase Agreement is hereby amended by deleting the
third sentence thereto and replacing with the following:

 

“Any waiver, permit, consent or approval of any kind or character on the part of
the Purchasers of any breach or default under this Agreement or any such waiver
of any provision or condition of this Agreement must be in writing by the
Required Purchasers, Napo and, prior to the Merger, Nantucket and shall be
effective only to the extent in such writing specifically set forth.”

 

g.  Exhibit B of the Note Purchase Agreement is hereby amended by deleting
Exhibit B in its entirety and substituting with the following:

 

EXHIBIT B

 

ALLOCATION OF NOTES

 

Purchaser

 

Notes

 

Aggregate Purchase Price

 

Initial Closing

 

 

 

 

 

MEF I, LP

 

$

217,974.96

 

$

262,500

 

Riverside Merchant Partners LLC

 

$

217,974.96

 

$

262,500

 

Subsequent Closing

 

 

 

 

 

 

Riverside Merchant Partners LLC

 

$

367,500.00

 

$

262,500

 

MEF I, LP

 

$

367,500.00

 

$

262,500

 

 

 

 

 

 

 

TOTAL

 

$

1,170,949.92

 

$

1,050,000

 

 

h.  Section 1.1 of ANNEX II of the Note Purchase Agreement is hereby amended by
deleting Section 1.1 in its entirety and substituting with the following:

 

“1.1        No later than January 31, 2018 (the “Filing Date”), the Company
shall prepare and submit to the Securities and Exchange Commission (the
“Commission”), a

 

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Registration Statement on Form S-3 (or such other form available) covering the
public resale of the Registrable Securities and shall cause such Registration
Statement to be filed by the Filing Date for such Registration Statement and use
reasonable best efforts to have the Registration Statement declared effective
under the Act as soon as possible thereafter (the “Effectiveness Date”). The
Company shall use its reasonable best efforts to keep such Registration
Statement continuously effective under the Act during the entire Effectiveness
Period.”

 

i.  Section 1.6 of ANNEX II of the Note Purchase Agreement is hereby amended by
deleting the definition of “Registrable Securities” in its entirety and
substituting with the following:

 

““Registrable Securities” means: (i) the shares issuable upon exchange of the
Notes, (ii) the Redemption Shares, and (iii) any securities issued or issuable
upon any stock split, dividend or other distribution, recapitalization or
similar event, or any price adjustment as a result of such stock splits, reverse
stock splits or similar events with respect to any of the securities referenced
in (i) or (ii).”

 

3.             Amendments to the Original Notes.

 

a.  The Original Notes are hereby amended such that they shall be in the forms
attached hereto as Exhibits A-1, A-2, A-3 and A-4 (such Original Notes as
amended, the “Amended Notes”).

 

b.  The Purchasers shall exchange the Original Notes in consideration for the
Amended Notes. Upon the execution of this Amendment by the Company and the
Purchasers, the Purchasers shall send (i) the Original Notes to the Company’s
principal address set forth in Section 7.2 of the Note Purchase Agreement.
Promptly upon receipt thereof, the Company shall deliver the Amended Notes to
the Purchasers at the addresses set forth on the signature pages of the Note
Purchase Agreement.

 

4.             Conditions to Effectiveness.  This Amendment shall become
effective when executed and delivered by each of the parties hereto.

 

5.             Ratifications.  Except as expressly modified and superseded by
this Amendment as set forth in Section 2 hereof, the terms and provisions of the
Note Purchase Agreement are ratified and confirmed and shall continue in full
force and effect.

 

6.             Severability.  Any provision of this Amendment held by a court of
competent jurisdiction to be invalid or unenforceable shall not impair or
invalidate the remainder of this Amendment and the effect thereof shall be
confined to the provision so held to be invalid or unenforceable.

 

7.             APPLICABLE LAW.  THIS AMENDMENT AND ALL OTHER DOCUMENTS EXECUTED
PURSUANT HERETO SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
INTERNAL LAWS OF THE STATE OF DELAWARE.

 

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8.             Counterparts.  This Amendment may be executed and delivered in
any number of counterparts, and by different parties hereto on separate
counterparts, each of which when so executed and delivered shall be deemed to be
an original and all of which counterparts taken together shall constitute one
and the same instrument.  Execution of this Amendment via facsimile or other
electronic transmission (e.g., .pdf) shall be effective, and signatures received
via facsimile or other electronic transmission shall be binding upon the parties
hereto and shall be effective as originals.

 

9.             Headings.  The headings, captions, and arrangements used in this
Amendment are for convenience only and shall not affect the interpretation of
this Amendment.

 

[Remainder of Page Intentionally Left Blank; Signature Pages Follow]

 

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IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Amendment as of the day and year first above written.

 

 

COMPANY:

 

 

 

NAPO PHARMACEUTICALS, INC.

 

 

 

 

 

By:

/s/ Lisa A. Conte

 

Name:

Lisa A. Conte

 

Title:

Chief Executive Officer

 

 

 

PURCHASERS:

 

 

 

MEF I, LP

 

 

 

 

 

By:

Magna GP LLC, in its capacity as General Partner

 

 

 

 

 

By:

/s/ Joshua Sason

 

Name:

Joshua Sason

 

Title:

Managing Member

 

 

 

Address:

 

 

 

40 Wall Street

 

58th Floor

 

New York,New York 10005

 

 

 

RIVERSIDE MERCHANT PARTNERS

 

 

 

 

By:

/s/ Matthew Kern

 

Name:

Matthew Kern

 

Title:

Chief Financial Officer

 

 

 

Address:

 

 

 

125 Jericho Turnpike, Suite 504

 

Jericho, New York 11753

 

[Signature Page to Third Amendment to Note Purchase Agreement]

 

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