EXHIBIT 10.4

 

CERTIFICATE OF AMENDMENT

OF

AMENDED AND RESTATED

CERTIFICATE OF INCORPORATION

OF

LIPIMETIX DEVELOPMENT, INC.

 

LIPIMETIX DEVELOPMENT, INC., a corporation organized and existing under and by
virtue of the General Corporation Law of the State of Delaware (the
“Corporation”), hereby certifies as follows:

 

First: The name of the Corporation is LipimetiX Development, Inc.

 

Second:       The Amended and Restated Certificate of Incorporation of the
Corporation is hereby amended by adding a new Section 7 of Part B of Article
Fourth to read in its entirety as set forth below, and renumbering each of
current Sections 7 and 8 to be Sections 8 and 9 respectively:

 

7.       Optional Conversion of Series A Preferred. The holders of the Series A
Preferred Stock shall have conversion rights as set forth below (the “Conversion
Rights”). For purposes of this Section 7, references herein to “Common Stock”
shall refer to “Class A-1 Common Stock”.

 

7.1       Right to Convert.

 

7.1.1       Conversion Ratio. Each share of Series A Preferred Stock shall be
convertible, at the option of the holder thereof, at any time and from time to
time, and without the payment of additional consideration by the holder thereof,
into such number of fully paid and non-assessable shares of Common Stock as is
determined by dividing the Series A Issue Value (as defined below) by the Series
A Conversion Price (as defined below) in effect at the time of conversion. The
Series A Issue Value shall be the Series A Original Issue Price less the
aggregate dividends paid with respect to each share of Series A Preferred Stock.
The Series A Conversion Price will be equal to the lesser of the Series B-1
Conversion Price or the price per share of the shares issued in the next equity
financing of the Corporation with proceeds of at least One Million Dollars
($1,000,000), as determined by the Board of Directors of the Corporation and
identified as such in the minutes or resolutions of the Board of Directors of
the Corporation approving the issuance of such equity.

 

7.1.2       Termination of Conversion Rights. In the event of a liquidation,
dissolution or winding up of the Corporation or a Deemed Liquidation Event, the
Conversion Rights shall terminate at the close of business on the last full day
preceding the date fixed for the payment of any such amounts distributable on
such event to the holders of Series A Preferred Stock.

 

 

 

7.2       Fractional Shares. No fractional shares of Common Stock shall be
issued upon conversion of the Series A Preferred Stock. In lieu of any
fractional shares to which the holder would otherwise be entitled, the
Corporation shall pay cash equal to such fraction multiplied by the fair market
value of a share of Common Stock as determined in good faith by the Board of
Directors of the Corporation. Whether or not fractional shares would be issuable
upon such conversion shall be determined on the basis of the total number of
shares of Series A Preferred Stock the holder is at the time converting into
Common Stock and the aggregate number of shares of Common Stock issuable upon
such conversion.

 

7.3       Mechanics of Conversion.

 

7.3.1       Notice of Conversion. In order for a holder of Series A Preferred
Stock to voluntarily convert shares of Series A Preferred Stock into shares of
Common Stock, such holder shall (a) provide written notice to the Corporation’s
transfer agent at the office of the transfer agent for the Series A Preferred
Stock (or at the principal office of the Corporation if the Corporation serves
as its own transfer agent) that such holder elects to convert all or any number
of such holder’s shares of Series A Preferred Stock and, if applicable, any
event on which such conversion is contingent and (b), if such holder’s shares
are certificated, surrender the certificate or certificates for such shares of
Series A Preferred Stock (or, if such registered holder alleges that such
certificate has been lost, stolen or destroyed, a lost certificate affidavit and
agreement reasonably acceptable to the Corporation to indemnify the Corporation
against any claim that may be made against the Corporation on account of the
alleged loss, theft or destruction of such certificate), at the office of the
transfer agent for the Series A Preferred Stock (or at the principal office of
the Corporation if the Corporation serves as its own transfer agent). Such
notice shall state such holder’s name or the names of the nominees in which such
holder wishes the shares of Common Stock to be issued. If required by the
Corporation, any certificates surrendered for conversion shall be endorsed or
accompanied by a written instrument or instruments of transfer, in form
satisfactory to the Corporation, duly executed by the registered holder or his,
her or its attorney duly authorized in writing. The close of business on the
date of receipt by the transfer agent (or by the Corporation if the Corporation
serves as its own transfer agent) of such notice and, if applicable,
certificates (or lost certificate affidavit and agreement) shall be the time of
conversion (the “Conversion Time”), and the shares of Common Stock issuable upon
conversion of the specified shares shall be deemed to be outstanding of record
as of such date. The Corporation shall, as soon as practicable after the
Conversion Time (i) issue and deliver to such holder of Series A Preferred
Stock, or to his, her or its nominees, a certificate or certificates for the
number of full shares of Common Stock issuable upon such conversion in
accordance with the provisions hereof and a certificate for the number (if any)
of the shares of Series A Preferred Stock represented by the surrendered
certificate that were not converted into Common Stock, (ii) pay in cash such
amount as provided in Subsection 7.2 in lieu of any fraction of a share of
Common Stock otherwise issuable upon such conversion and (iii) pay all declared
but unpaid dividends on the shares of Series A Preferred Stock converted.

 

 -2- 

 

7.3.2       Reservation of Shares. The Corporation shall at all times when the
Series A Preferred Stock shall be outstanding, reserve and keep available out of
its authorized but unissued capital stock, for the purpose of effecting the
conversion of the Series A Preferred Stock, such number of its duly authorized
shares of Common Stock as shall from time to time be sufficient to effect the
conversion of all outstanding Series A Preferred Stock; and if at any time the
number of authorized but unissued shares of Common Stock shall not be sufficient
to effect the conversion of all then outstanding shares of the Series A
Preferred Stock, the Corporation shall take such corporate action as may be
necessary to increase its authorized but unissued shares of Common Stock to such
number of shares as shall be sufficient for such purposes, including, without
limitation, engaging in best efforts to obtain the requisite stockholder
approval of any necessary amendment to the Certificate of Incorporation. Before
taking any action which would cause an adjustment reducing the Series A
Conversion Price below the then par value of the shares of Common Stock issuable
upon conversion of the Series A Preferred Stock, the Corporation will take any
corporate action which may, in the opinion of its counsel, be necessary in order
that the Corporation may validly and legally issue fully paid and non-assessable
shares of Common Stock at such adjusted Series A Conversion Price.

 

7.3.3       Effect of Conversion. All shares of Series A Preferred Stock which
shall have been surrendered for conversion as herein provided shall no longer be
deemed to be outstanding and all rights with respect to such shares shall
immediately cease and terminate at the Conversion Time, except only the right of
the holders thereof to receive shares of Common Stock in exchange therefor, to
receive payment in lieu of any fraction of a share otherwise issuable upon such
conversion as provided in Subsection 7.2. Any shares of Series A Preferred Stock
so converted shall be retired and cancelled and may not be reissued as shares of
such series, and the Corporation may thereafter take such appropriate action
(without the need for stockholder action) as may be necessary to reduce the
authorized number of shares of Series A Preferred Stock accordingly.

 

7.3.4       No Further Adjustment. Upon any such conversion, no adjustment to
the Series A Conversion Price shall be made for any declared but unpaid
dividends on the Series A Preferred Stock surrendered for conversion or on the
Common Stock delivered upon conversion.

 

7.3.5       Taxes. The Corporation shall pay any and all issue and other similar
taxes that may be payable in respect of any issuance or delivery of shares of
Common Stock upon conversion of shares of Series A Preferred Stock pursuant to
this Section 7. The Corporation shall not, however, be required to pay any tax
which may be payable in respect of any transfer involved in the issuance and
delivery of shares of Common Stock in a name other than that in which the shares
of Series A Preferred Stock so converted were registered, and no such issuance
or delivery shall be made unless and until the person or entity requesting such
issuance has paid to the Corporation the amount of any such tax or has
established, to the satisfaction of the Corporation, that such tax has been
paid.

 

 -3- 

 

7.4       Adjustment for Merger or Reorganization, etc. Subject to the
provisions of Subsection 7.3, if there shall occur any reorganization,
recapitalization, reclassification, consolidation or merger involving the
Corporation in which the Common Stock (but not the Series A Preferred Stock) is
converted into or exchanged for securities, cash or other property (other than a
transaction resulting in an adjustment of the Series A Conversion Price), then,
following any such reorganization, recapitalization, reclassification,
consolidation or merger, each share of Series A Preferred Stock shall thereafter
be convertible in lieu of the Common Stock into which it was convertible prior
to such event into the kind and amount of securities, cash or other property
which a holder of the number of shares of Common Stock of the Corporation
issuable upon conversion of one share of Series A Preferred Stock immediately
prior to such reorganization, recapitalization, reclassification, consolidation
or merger would have been entitled to receive pursuant to such transaction; and,
in such case, appropriate adjustment (as determined in good faith by the Board
of Directors of the Corporation) shall be made in the application of the
provisions in this Section 7 with respect to the rights and interests thereafter
of the holders of the Series A Preferred Stock, to the end that the provisions
set forth in this Section 7 shall thereafter be applicable, as nearly as
reasonably may be, in relation to any securities or other property thereafter
deliverable upon the conversion of the Series A Preferred Stock.

 

7.5       Certificate as to Adjustments. Upon the occurrence of each adjustment
or readjustment of the Series A Conversion Price, the Corporation at its expense
shall, as promptly as reasonably practicable but in any event not later than ten
(10) days thereafter, compute such adjustment or readjustment in accordance with
the terms hereof and furnish to each holder of Series A Preferred Stock a
certificate setting forth such adjustment or readjustment (including the kind
and amount of securities, cash or other property into which the Series A
Preferred Stock is convertible) and showing in detail the facts upon which such
adjustment or readjustment is based. The Corporation shall, as promptly as
reasonably practicable after the written request at any time of any holder of
Series A Preferred Stock (but in any event not later than ten (10) days
thereafter), furnish or cause to be furnished to such holder a certificate
setting forth (i) the Series A Conversion Price then in effect, and (ii) the
number of shares of Common Stock and the amount, if any, of other securities,
cash or property which then would be received upon the conversion of Series A
Preferred Stock.

 

 -4- 

 

7.6       Notice of Record Date. In the event:

 

(a)       the Corporation shall take a record of the holders of its Common Stock
(or other capital stock or securities at the time issuable upon conversion of
the Series A Preferred Stock) for the purpose of entitling or enabling them to
receive any dividend or other distribution, or to receive any right to subscribe
for or purchase any shares of capital stock of any class or any other
securities, or to receive any other security; or

 

(b)       of any capital reorganization of the Corporation, any reclassification
of the Common Stock of the Corporation, or any Deemed Liquidation Event; or

 

(c)       of the voluntary or involuntary dissolution, liquidation or winding-up
of the Corporation,

 

then, and in each such case, the Corporation will send or cause to be sent to
the holders of the Series A Preferred Stock a notice specifying, as the case may
be, (i) the record date for such dividend, distribution or right, and the amount
and character of such dividend, distribution or right, or (ii) the effective
date on which such reorganization, reclassification, consolidation, merger,
transfer, dissolution, liquidation or winding-up is proposed to take place, and
the time, if any is to be fixed, as of which the holders of record of Common
Stock (or such other capital stock or securities at the time issuable upon the
conversion of the Series A Preferred Stock) shall be entitled to exchange their
shares of Common Stock (or such other capital stock or securities) for
securities or other property deliverable upon such reorganization,
reclassification, consolidation, merger, transfer, dissolution, liquidation or
winding-up, and the amount per share and character of such exchange applicable
to the Series A Preferred Stock and the Common Stock. Such notice shall be sent
at least fifteen (15) days prior to the record date or effective date for the
event specified in such notice.

 

Third:       The foregoing amendment of the Certificate of Incorporation of the
Corporation, as amended, herein certified has been duly adopted in accordance
with the provisions of Sections 228 and 242 of the General Corporation Law of
the State of Delaware.

 

 -5- 

 

In Witness Whereof, the undersigned authorized officer of LipimetiX Development,
Inc. has caused this Certificate of Amendment of Certificate of Incorporation to
be signed this _11th____ day of ___August___, 2017.

 

LIPIMETIX DEVELOPMENT, INC.

 

 

 

By: /s/ Dennis I. Goldberg, Ph.D.         

 

Name: Dennis I. Goldberg, Ph.D.          

Title: President & CEO                           

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

-6-