Exhibit 10.24

 

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF
1933, AS AMENDED, OR UNDER THE SECURITIES LAWS OF ANY STATE OR OTHER
JURISDICTION, AND MAY NOT BE SOLD, ASSIGNED, TRANSFERRED, PLEDGED OR OTHERWISE
DISPOSED OF EXCEPT IN COMPLIANCE WITH, OR PURSUANT TO AN EXEMPTION FROM, THE
REQUIREMENTS OF SUCH ACT OR SUCH LAWS.

 

_______________________________

 

BIONIK LABORATORIES CORP.

 

CONVERTIBLE PROMISSORY NOTE

 

Principal Amount: US$150,000.00 Issue Date: May 23, 2017

 

BIONIK LABORATORIES CORP., a Delaware corporation (the “Company”), for value
received, hereby promises to pay to Bluestone International Capital LLC or its
permitted assigns or successors (the “Holder”), the principal amount of One
Hundred Fifty Thousand Dollars (US$150,000.00) (the “Principal Amount”), without
demand, on the Maturity Date (as hereinafter defined), together with any accrued
and unpaid interest due thereon. This Note shall bear interest at a fixed rate
of 8% per annum, beginning on the Issue Date. Interest shall be computed based
on a 360-day year of twelve 30-day months and shall be payable, along with the
Principal Amount, on the Maturity Date. Except as set forth in Section 3.1, (a)
payment of all principal due shall be in such coin or currency of the United
States of America as shall be legal tender for the payment of public and private
debts at the time of payment and (b) payment of all interest due shall be in
Common Stock based on the average three (3) trading day VWAP for the ten (10)
days preceding the Maturity Date.

 

This Note is a convertible promissory note referred to in that certain
Subscription Agreement dated as of the date hereof (the “Subscription
Agreement”), or series of like subscription agreements, among the Company and
the subscriber(s) named therein, pursuant to which the Company is seeking to
raise an aggregate of up to $2,000,000.

 

ARTICLE 1

 

DEFINITIONS

 

SECTION 1.1.  Definitions. The terms defined in this Article whenever used in
this Note shall have the respective meanings hereinafter specified.

 

“Applicable Laws” means any and all applicable foreign, federal, state and local
statutes, laws, regulations, ordinances, policies, and rules or common law
(whether now existing or hereafter enacted or promulgated), of any and all
governmental authorities, agencies, departments, commissions, boards, courts, or
instrumentalities of the United States, any state of the United States, any
other nation, or any political subdivision of the United States, any state of
the United States or any other nation, and all applicable judicial and
administrative, regulatory or judicial decrees, judgments and orders, including
common law rules and determinations.

 

 1 

 

 

“Common Stock” means the common stock, common shares or equivalent equity of the
Company.

 

“Conversion Shares” means the New Round Stock issued or issuable to the Holder
upon a Conversion Date pursuant to Article 3.

 

“Conversion Date” shall have the meaning set forth in Section 3.1.

 

“Event of Default” shall have the meaning set forth in Section 6.1.

 

“Holder” or “Holders” means the person named above or any Person who shall
thereafter become a recordholder of this Note in accordance with the terms
hereof.

 

“Issue Date” means the issue date stated above.

 

“Maturity Date” shall mean the earlier of: (a) May 23, 2018 or (b) the
consummation of a Qualified Financing.

 

“New Round Stock” means, in the event of a Qualified Financing, the securities
(or units of securities if more than one security are sold as a unit) issued by
the Company in the Qualified Financing.

 

“Note” means this Convertible Note, as amended, modified or restated.

 

“Person” means an individual, corporation, partnership, limited liability
company, association, trust, joint venture, unincorporated organization or any
government, governmental department or agency or political subdivision thereof.

 

“Qualified Financing” means the next equity round of financing of the Company in
whatever form or type, that raises in excess of $3,000,000 gross proceeds.

 

“Securities Act” means the United States Securities Act of 1933, as amended.

 

“Trading Market” means any of the following markets or exchanges on which the
Common Stock is listed or quoted for trading on the date in question: the NYSE
MKT, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global
Select Market or the New York Stock Exchange (or any successors to any of the
foregoing).

 

 2 

 

 

“VWAP” means, for any date, the price determined by the first of the following
clauses that applies: (a) if the Common Stock is then listed or quoted on a
Trading Market, the daily volume weighted average price of the Common Stock for
such date (or the nearest preceding date) on the Trading Market on which the
Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a
Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City
time)), (b) if the Common Stock is not then listed or quoted for trading on a
Trading Market and if prices for the Common Stock are then reported on the OTC
Markets, Inc. (or a similar organization or agency succeeding to its functions
of reporting prices), the most recent bid price per share of the Common Stock so
reported, or (c) in all other cases, the fair market value of a share of Common
Stock as determined by the Board of Directors of the Company in good faith.

 

“Warrants” means the warrants to purchase Common Stock pursuant to Section
3.1(b), which shall be evidenced by the warrant agreement, the form of which is
attached to the Subscription Agreement as Exhibit C.

 

ARTICLE 2

 

GENERAL PROVISIONS

 

SECTION 2.1. Loss, Theft. Destruction of Note. Upon receipt of evidence
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Note and, in the case of any such loss, theft or destruction, upon receipt
of indemnity or security reasonably satisfactory to the Company, or, in the case
of any such mutilation, upon surrender and cancellation of this Note, the
Company will make and deliver, in lieu of such lost, stolen, destroyed or
mutilated Note, a new Note of like tenor and unpaid principal amount dated as of
the date hereof. This Note shall be held and owned upon the express condition
that the provisions of this Section 2.1 are exclusive with respect to the
replacement of a mutilated, destroyed, lost or stolen Note and shall preclude
any and all other rights and remedies notwithstanding any law or statute
existing or hereafter enacted to the contrary with respect to the replacement of
negotiable instruments or other securities without their surrender.

 

SECTION 2.2. Prepayment; Redemption. This Note may not be prepaid by the Company
in whole or in part, except with the prior written consent of the Holder. This
Note may not be redeemed by the Company in whole or in part, except with the
prior written consent of the Holder.

 

ARTICLE 3

 

CONVERSION OF NOTE

 

SECTION 3.1. Conversion.

 

(a)            Conversion Upon Qualified Financing. Without any action on the
part of the Holder, all of the outstanding principal and accrued interest (the
“Outstanding Balance”) shall convert into New Round Stock upon the consummation
of a Qualified Financing (the “Conversion Date”), based upon the lesser of: (i)
$0.50 per New Round Stock and (ii) the quotient obtained by dividing (x) the
Outstanding Balance on the Conversion Date multiplied by 1.10 by (y) the actual
price per New Round Stock in the Qualified Financing.

 

(b)            Upon the Maturity Date, the Holder shall further be issued
Warrants exercisable into a number of shares of Common Stock equal to (i) in the
case of a Maturity Date that is a Conversion Date, 25% of the number of
Conversion Shares (but, in the case of units of securities, the primary equity
security or the number of shares of Common Stock underlying the primary security
if the primary security is not Common Stock) and (ii) in the case of a Maturity
Date that is not a Conversion Date (a “Warrant Issue Date”), the number of
shares of Common Stock equal to the quotient obtained by dividing the
Outstanding Balance by [__].

 

 3 

 

 

(c)            Upon and as of the Conversion Date, this Note will be cancelled
on the books and records of the Company and shall represent the right to receive
the Conversion Shares.

 

SECTION 3.2. Delivery of Securities Upon Conversion.

 

(a)            As soon as is practicable after the Conversion Date, the Company
shall deliver to the Holder (i) a certificate or certificates evidencing the
Conversion Shares issuable to the Holder and (ii) the Warrants issuable to the
Holder. As soon as is practicable after the Warrant Issue Date, the Company
shall deliver to the Holder the Warrants issuable to the Holder.

 

(b)            The issuance of certificates for Conversion Shares and Warrants
upon conversion or maturity of this Note shall be made without charge to the
Holder for any issuance tax in respect thereof or other cost incurred by the
Company in connection with such conversion and the related issuance of
securities. Upon conversion of this Note, the Company shall take all such
actions as are necessary in order to ensure that the Conversion Shares so issued
upon such conversion shall be validly issued, fully paid and nonassessable.

 

SECTION 3.3. Fractional Shares. No fractional shares or scrip representing
fractional shares shall be issued upon conversion of this Note. If any
conversion of this Note would create a fractional share or a right to acquire a
fractional share, the Company shall round to the nearest whole number.

 

ARTICLE 4

 

STATUS; RESTRICTIONS ON TRANSFER

 

SECTION 4.1. Status of Note. This Note is a direct, general and unconditional
obligation of the Company, and constitutes a valid and legally binding
obligation of the Company, enforceable in accordance with its terms subject, as
to enforcement, to bankruptcy, insolvency, reorganization and other similar laws
of general applicability relating to or affecting creditors’ rights and to
general principles of equity.

 

SECTION 4.2. Restrictions on Transferability. This Note and any Conversion
Shares issued with respect to this Note, have not been registered under the
Securities Act, or under any state securities or so-called “blue sky laws,” and
may not be offered, sold, transferred, hypothecated or otherwise assigned except
(a) pursuant to a registration statement with respect to such securities which
is effective under the Act or (b) upon receipt from counsel satisfactory to the
Company of an opinion, which opinion is satisfactory in form and substance to
the Company, to the effect that such securities may be offered, sold,
transferred, hypothecated or otherwise assigned (i) pursuant to an available
exemption from registration under the Act and (ii) in accordance with all
applicable state securities and so-called “blue sky laws.” The Holder agrees to
be bound by such restrictions on transfer. The Holder further consents that the
certificates representing the Conversion Shares that may be issued with respect
to this Note may bear a restrictive legend to such effect.

 

 4 

 

 

ARTICLE 5

 

COVENANTS

 

In addition to the other covenants and agreements of the Company set forth in
this Note, the Company covenants and agrees that so long as this Note shall be
outstanding:

 

SECTION 5.1. Payment of Note. The Company will punctually, according to the
terms hereof, (a) pay or cause to be paid all amounts due under this Note, (b)
reasonably promptly issue the Conversion Shares and the Warrants upon the
Conversion Date and (c) reasonably promptly issue the Warrants after the Warrant
Issue Date.

 

SECTION 5.2. Notice of Default. If any one or more events occur which constitute
or which, with the giving of notice or the lapse of time or both, would
constitute an Event of Default or if the Holder shall demand payment or take any
other action permitted upon the occurrence of any such Event of Default, the
Company will forthwith give notice to the Holder, specifying the nature and
status of the Event of Default or other event or of such demand or action, as
the case may be.

 

SECTION 5.3. Compliance with Laws. The Company will comply in all material
respects with all Applicable Laws, except where the necessity of compliance
therewith is contested in good faith by appropriate proceedings.

 

SECTION 5.4. Use of Proceeds. The Company shall use the proceeds of this Note
for general working capital.

 

ARTICLE 6

 

REMEDIES

 

SECTION 6.1. Events of Default. “Event of Default” wherever used herein means
any one of the following events:

 

(a)            The Company shall fail to issue and deliver the Conversion Shares
or Warrants in accordance with Article 3;

 

(b)            Default in the due and punctual payment of the principal of, or
any other amount owing in respect of (including Interest), this Note when and as
the same shall become due and payable;

 

(c)            Default in the performance or observance of any covenant or
agreement of the Company in this Note (other than a covenant or agreement a
default in the performance of which is specifically provided for elsewhere in
this Section 6.1), and the continuance of such default for a period of ten (10)
days after there has been given to the Company by the Holder a written notice
specifying such default and requiring it to be remedied;

 

 5 

 

 

(d)            The entry of a decree or order by a court having jurisdiction
adjudging the Company as bankrupt or insolvent; or approving as properly filed a
petition seeking reorganization, arrangement, adjustment or composition of or in
respect of the Company under the Federal Bankruptcy Code or any other applicable
federal or state law, or appointing a receiver, liquidator, assignee, trustee or
sequestrator (or other similar official) of the Company or of any substantial
part of its property, or ordering the winding-up or liquidation of its affairs,
and the continuance of any such decree or order unstayed and in effect for a
period of sixty (60) calendar days;

 

(e)            The institution by the Company of proceedings to be adjudicated
as bankrupt or insolvent, or the consent by it to the institution of bankruptcy
or insolvency proceedings against it, or the filing by it of a petition or
answer or consent seeking reorganization or relief under the Federal Bankruptcy
Code or any other applicable federal or state law, or the consent by it to the
filing of any such petition or to the appointment of a receiver, liquidator,
assignee, trustee or sequestrator (or other similar official) of the Company or
of any substantial part of its property, or the making by it of an assignment
for the benefit of creditors;

 

(f)            The Company seeks the appointment of a statutory manager or
proposes in writing or makes a general assignment or an arrangement or
composition with or for the benefit of its creditors or any group or class
thereof or files a petition for suspension of payments or other relief of
debtors or a moratorium or statutory management is agreed or declared in respect
of or affecting all or any material part of the indebtedness of the Company; or

 

(g)            It becomes unlawful for the Company to perform or comply with its
obligations under this Note.

 

SECTION 6.2. Effects of Default. If an Event of Default occurs and is
continuing, then and in every such case the Holder may declare this Note to be
due and payable immediately, by a notice in writing to the Company, and upon any
such declaration, the Company shall pay to the Holder the outstanding principal
amount of this Note plus all accrued and unpaid interest through the date the
Note is paid in full.

 

SECTION 6.3. Remedies Not Waived. No course of dealing between the Company and
the Holder or any delay in exercising any rights hereunder shall operate as a
waiver by the Holder. No failure or delay by the Holder in exercising any right,
power or privilege under this Note shall operate as a waiver thereof nor shall
any single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or privilege. The rights and
remedies herein provided shall be cumulative and not exclusive of any rights or
remedies provided by Applicable Law.

 

ARTICLE 7

 

MISCELLANEOUS

 

SECTION 7.1. Severability. If any provision of this Note shall be held to be
invalid or unenforceable, in whole or in part, neither the validity nor the
enforceability of the remainder hereof shall in any way be affected.

 

 6 

 

 

SECTION 7.2. Notice. Where this Note provides for notice of any event, such
notice shall be given (unless otherwise herein expressly provided) in writing
and either (i) delivered personally, (ii) sent by certified, registered or
express mail, postage prepaid or (iii) sent by facsimile or other electronic
transmission, and shall be deemed given when so delivered personally, sent by
facsimile or other electronic transmission (confirmed in writing) or mailed.
Notices shall be addressed, if to Holder, to its address as provided in the
Subscription Agreement or, if to the Company, to its principal office.

 

SECTION 7.3. Governing Law. This Note shall be governed by, and construed in
accordance with, the laws of the State of New York (without giving effect to any
conflicts or choice of law provisions that would cause the application of the
domestic substantive laws of any other jurisdiction).

 

SECTION 7.4. Forum. The Holder and the Company hereby agree that any dispute
which may arise out of or in connection with this Note shall be adjudicated
before a court of competent jurisdiction in the State of New York and they
hereby submit to the exclusive jurisdiction of the courts of the County and
State of New York, as well as to the jurisdiction of all courts to which an
appeal may be taken from such courts, with respect to any action or legal
proceeding commenced by either of them and hereby irrevocably waive any
objection they now or hereafter may have respecting the venue of any such action
or proceeding brought in such a court or respecting the fact that such court is
an inconvenient forum.

 

SECTION 7.5. Headings. The headings of the Articles and Sections of this Note
are inserted for convenience only and do not constitute a part of this Note.

 

SECTION 7.6. Amendments. Any provision of this Note may be amended, modified or
waived if and only if the Holder of this Note and the Company has consented in
writing to such amendment, modification or waiver of any such provision of this
Note.

 

SECTION 7.7. No Recourse Against Others. The obligations of the Company under
this Note are solely obligations of the Company and no officer, employee or
stockholder shall be liable for any failure by the Company to pay amounts on
this Note when due or perform any other obligation.

 

SECTION 7.9. Assignment; Binding Effect. This Note may not be assigned by the
Company without the prior written consent of the Holder. This Note shall be
binding upon and inure to the benefit of both parties hereto and their
respective permitted successors and assigns.

 

IN WITNESS WHEREOF, the Company has caused this Note to be signed by its duly
authorized officer on the date hereinabove written.

 

  BIONIK LABORATORIES CORP.         By: /s/ Peter Bloch     Name: Peter Bloch  
  Title: CEO

 

 7