aethlon_10q-ex1004.htm


    
      
        

      

    

    EXHIBIT 10.4

     

    SECURITIES PURCHASE
AGREEMENT

    


    This
Securities Purchase Agreement (“Agreement”) is entered into as
of February 12, 2010 by and between AETHLON MEDICAL, INC., a corporation
organized under the laws of the State of Nevada (the “Company”), and the Person set
forth on the signature page hereto as the “Purchaser” hereunder (“Purchaser”).

     

    WHEREAS,
subject to the terms and conditions set forth in this Agreement, the Company
desires to issue and sell to the Purchaser, and the Purchaser desires to
purchase from the Company, securities of the Company in a PIPE Transaction as
set forth herein;

     

    NOW
THEREFORE, in consideration of the foregoing premise and the covenants contained
herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Purchaser
agree as follows:

    


    1.   Incorporation
by Reference; Definitions.

    


    
      	
              (a)

            	
              Incorporation.  This
      Agreement incorporates by reference, as if set forth herein in its
      entirety and including without limitation all terms, conditions and
      provisions set forth therein, the PipeFund Services Organization Standard
      Transaction Document labeled GTC 1-10 (General Terms and Conditions)
      available and accessible at www.pipefund.com
      (“PST Document
      GTC”); provided,
      however, that to the extent any of the terms, conditions or
      provisions of this Agreement (without such incorporation) contradict or
      conflict with the terms, conditions or provisions of PST Document GTC,
      this Agreement shall control.

            


    

    


    
      	
              (b)

            	
              Defined
      Terms.  Each initially capitalized term used but not
      defined in this Agreement (including PST Document GTC as incorporated
      herein pursuant to the preceding Section), and each initially capitalized
      term used but not defined in any other Transaction Document, shall have
      the meaning ascribed thereto in the PipeFund Services Organization
      Standard Transaction Document labeled 1-10 DEF (Definitions) available and
      accessible at www.pipefund.com.

            


    

    


    
      	
              (c)

            	
              PipeFund Transaction
      Code.  This Securities Purchase Agreement shall be known
      as “Securities Purchase Agreement
#AEMD-10-A”.

            


    

    


    2.   Securities.  The
Company agrees to issue and sell, and the Purchaser agrees to purchase, in
consideration for payment by the Purchaser of its Subscription Amount indicated
below and on the Purchaser’s signature page hereto, upon the terms and
conditions contained in this Securities Purchase Agreement, the following
Securities:

     

    
      	
              (a)

            	
              Note.  Convertible
      Promissory Note of the Company, in the form attached hereto as Exhibit A
      (“Note”), with an
      aggregate original principal amount equal to $660,000;
  and

            


    

     

    
      	
              (b)

            	
              Warrant.  3-year
      Warrant, in the form attached hereto as Exhibit B, to
      purchase 660,000 Warrant Shares, having an initial exercise price equal to
      $0.50.

            


    

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    3.   Purchase Price; Form of Payment;
Closing.  The Subscription Amount for the Note and Warrant to
be purchased by the Purchaser hereunder shall be $600,000.  At
Closing, the Purchaser shall pay the Subscription Amount (a) by wire transfer of
$300,000 in immediately available funds to the Company, and (b) by delivering to
the Company a Secured Promissory Note in the principal amount of $300,000 in the
form attached hereto as Exhibit C (the “Promissory
Note”).  There shall be no Funds Escrow Agent or Documents
Escrow Agent for the Closing, provided that the original Note, Warrant and
Promissory Note shall be delivered to the Company’s counsel to be held in escrow
pending the Company’s receipt of the Purchaser’s wire
transfer.  Notwithstanding anything to the contrary contained in
Section 2.3(a)(viii) of PST Document GTC, the Company shall not be required to
deliver a Legal Opinion, Officer’s Certificate or Secretary’s Certificate under
subsections (B), (C) and (D) thereof, provided that the Company shall furnish to
the Purchaser copies of the Company’s current Certificate of Incorporation and
Bylaws and Board resolutions authorizing the Transactions.

     

    4.   Expenses.  On or
prior to the Closing, the Company shall pay the Purchaser a non-refundable,
non-accountable sum equal to $10,000 as and for the fees, costs and expenses
(including without limitation legal fees and disbursements expenses but
excluding the Origination Fee below) incurred by the Purchaser in connection
with the Purchaser’s negotiation, preparation and execution of the Transaction
Documents (“Expense
Amount”).  In addition, the Company shall pay the Purchaser,
for making the loans evidenced by the Note, an origination fee equal to 3% of
the Purchaser’s Subscription Amount hereunder, payable as
follows:  $9,000 upon the Closing (“Initial Origination Fee”) and 3% of
the amount of each cash principal payment made under the Promissory Note by the
Purchaser, which fee may be withheld and offset from such cash principal
payment.  The Purchaser may withhold and offset the Expense Amount,
the Initial Origination Fee and the PipeFund expenses from the payment of the
Purchaser’s Subscription Amount otherwise payable hereunder at Closing, which
offset shall constitute partial payment of such Subscription Amount in an amount
equal to such offset.

     

    5.   Company
Address for Notices:

    


    
      	
              Aethlon
      Medical, Inc.

              8910
      University Center Lane, Suite 660

              San
      Diego, CA 92122

              Attn:
      James A. Joyce, CEO

              Facsimile:
      (858) 272-2738

               

            	
              With a copy
      to:

              Law
      Office of Jennifer A. Post

              340
      North Camden Drive, Suite 302

              Beverly
      Hills, California 90210

              Attn:
      Jennifer A. Post, Esq.

              Facsimile:
      (800) 783–2983

            


    

     

    6.   Modifications
and Additional Terms.

    


    
      	
              (a)

            	
              No Registration
      Rights; Rule 144.  Sections 6.1 through 6.5 of PST
      Document GTC are hereby deleted such that the Purchaser shall not have any
      registration rights.  The Company acknowledges and agrees that,
      for purposes of Rule 144, the holding period for the shares of Common
      Stock issuable upon conversion or otherwise pursuant to the Note issued to
      the Purchaser shall have commenced on the date of original issuance of the
      Note.  After six months following the Closing Date, any and all
      shares of Common Stock issued upon conversion of the Note issued to the
      Purchaser shall be issued free and clear of any and all legends and
      restrictions thereon, provided that the Purchaser is not an Affiliate of
      the Company at such time.

            


    

    


    
      	
              (b)

            	
              The
      Bulletin Board shall be an Eligible
Market.

            


    

    


    
      	
              (c)

            	
              Negative
      Covenants. So long as the Note is outstanding, without the consent
      of the Purchaser, the Company will not, and will not permit any of its
      Subsidiaries to, directly or
indirectly:

            


    

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    
      	
              (i)  

            	
              amend
      its Certificate of Incorporation or Bylaws so as to materially and
      adversely affect any rights of the Purchaser (an increase in the amount of
      authorized shares and an increase in the number of directors will not be
      deemed adverse to the rights of the Purchaser);
  or

            


    

     

    
      	
              (ii)  

            	
              repay,
      repurchase or offer to repay, repurchase or otherwise acquire or make any
      dividend or distribution in respect of any of its Common Stock, preferred
      stock, or other equity securities other than to the extent permitted or
      required under the Transaction
Documents.

            


    

     

    [Signature Page
Follows]

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    IN WITNESS WHEREOF,
as of the
date first written above, the Parties hereto have duly executed, or caused their
authorized officers to duly execute, this Securities Purchase Agreement
#AEMD-10-A with file name “SPA -- AEMD v.2”.

    


    COMPANY:

    


    AETHLON
MEDICAL, INC.

    


    


    By: /s/ James B
Frakes                                   

    Name: James
B Frakes

    Title: Authorized
Signatory

    


    


    PURCHASER:

     

    
      1.   Signature:


      GEMINI
MASTER FUND, LTD.

      By:
GEMINI STRATEGIES, LLC

       

      
        By: /s/ Steven W.
Winters                            _

        Name:
Steven W. Winters

        Title:
President

         

        2.   Subscription
Amount:  $600,000.00

         

        
          3.   Maximum Ownership
Percentage:

          The Maximum
Ownership Percentage shall be 9.9% if no box is checked
below.

          
             

            
              	x 4.9%	o 9.9%	o Other:
      ______%	o None


            

             

             

             

             

            [Purchaser Signature Page to Securities Purchase
Agreement # AEMD-10-A P. 1/2]

             

            
              
                
                

              

              
                
                

                
                  

                

              

              
                
                

              

            

          

           

        

      

    

    PURCHASER:
_____________________________

    (Print
Name)

    


    
      	
              4.   Address for
      Notices:

            	
              With
      a copy to, if any:

            
	
               

              ______________________________________________

              (Name
      or c/o Name)

              ______________________________________________

              (Address)

              ______________________________________________

               

              ______________________________________________

              (Contact
      Name)

               

              ______________________________________________

              (Facsimile)

               

              ______________________________________________

              (Telephone)

              ______________________________________________

              (Email
      Address)

               

            	
               

              ______________________________________________

              (Name)

              ______________________________________________

              (Address)

              ______________________________________________

               

              ______________________________________________

              (Contact
      Name)

               

              ______________________________________________

              (Facsimile)

               

              ______________________________________________

              (Telephone)

               

              ______________________________________________

              (Email
      Address)

               

            
	
              5.   Residence/Organization
      and TIN:

               

            
	
              ______________________________________________

              (State/Jurisdiction
      of Primary Residence (for individuals)

              or
      Organization (for entities))

            	
              ______________________________________________

              (Social
      Security or Employer/Tax Identification Number,

              if
      applicable)

            
	
               

              6.   Special Instructions
      Where Securities to Be Delivered:

               

            
	
              For
      Common Stock:

               

            	
              For
      Other Securities:

               

            


    

     

     

    
       

       

      [Purchaser Signature Page to Securities Purchase Agreement
# AEMD-10-A P. 2/2]

      [Page 2 not intended to be publicly
disclosed]

       

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Exhibit
A

    


    FORM OF CONVERTIBLE
NOTE

     

     

     

     

     

    
 

    
      
        
        

      

      
        A-1

        
          

        

      

      
        
        

      

    

    


    Exhibit
B

    


    FORM OF
WARRANT

     

     

     

     

     

    
 

    
      
        
        

      

      
        B-1

        
          

        

      

      
        
        

      

    

     

    Exhibit
C

    


    FORM OF PROMISSORY
NOTE

    


    
 

     

     

     

     

    
      
        
        

      

      
        C-1