fs1ex4xii_iaso.htm


    Exhibit
4.12

    


    THIS NOTE
HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),
APPLICABLE STATE SECURITIES LAWS, OR APPLICABLE LAWS OF ANY FOREIGN
JURISDICTION.  THIS NOTE HAS BEEN ACQUIRED FOR INVESTMENT AND NOT WITH
A VIEW TO DISTRIBUTION OR RESALE, AND MAY NOT BE OFFERED, SOLD, PLEDGED,
HYPOTHECATED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND ANY APPLICABLE STATE
SECURITIES LAWS AND IN THE ABSENCE OF COMPLIANCE WITH APPLICABLE LAWS OF ANY
FOREIGN JURISDICTION, OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT
SUCH REGISTRATION IS NOT REQUIRED OR SUCH FOREIGN JURISDICTION LAWS HAVE BEEN
SATISFIED.

     

    PACIFIC
BEACH BIOSCIENCES, INC.

    10%
SENIOR PROMISSORY NOTE

     

     

    
      	 	 San Diego,
      California
	 $125,000	  June 24,
      2009


    

     

     

    1.           Principal and
Interest.

    


    PACIFIC BEACH BIOSCIENCES,
INC. (the “Company”), a Delaware
corporation, for value received, hereby promises to pay to the order of PARAMOUNT CREDIT PARTNERS,
LLC, or his, her or its assigns (“Holder”), in lawful
money of the United States of America at the address for notices to Holder set
forth in the applicable Purchase Agreement (as defined below) (or such other
address as Holder shall provide to the Company in writing pursuant hereto), the
principal amount of One Hundred Twenty Five Thousand Dollars ($125,000),
together with interest as set forth below.

    


    The Company promises to pay interest on
the unpaid principal amount from the date hereof until such principal amount is
paid in full at the rate of ten percent (10%), or such lesser rate as shall be
the maximum rate allowable under applicable law; provided however, that upon an
Event of Default (as defined herein) during the Term (as defined herein) of this
Note, the interest rate on this Note shall be increased to twelve percent (12%)
per annum during the term of the default.  Interest from the date
hereof shall be computed on the basis of a 360-day year of twelve 30-day months,
and shall accrue and be payable quarterly in arrears.  All unpaid
principal on this Note shall be due and payable on the earlier of (i) December
31, 2013; (ii) consummation by the Company of an equity financing (or series of
related equity financings), including without limitation a firm commitment
underwritten initial public offering pursuant to an effective registration
statement under the Securities Act of 1933, as amended, involving the sale of
equity securities in which the Company receives at least $10,000,000 in
aggregate gross cash proceeds (before brokers’ fees or other transaction related
expenses) (a “Qualified
Financing”); and (iii) consummation of a merger, share exchange or other
transaction (or series of related transactions), other than in connection with a
Qualified Financing, in which (A) the Company merges into or otherwise becomes a
wholly owned subsidiary of a company subject to the public company reporting
requirements of the Securities Exchange Act of 1934, as amended, and (B) the
aggregate consideration payable to the Company or its stockholders in such
transaction(s) is greater than or equal to $10,000,000 (such period of time from
the date of issuance hereof, the “Term”).  For
purposes of this Note, an “Event of Default”
shall occur if (i) the Company shall default in the payment on the Note, when
and as the same shall become due and payable and any such failure to make
payment continues for five (5) business days; or (ii) the Company shall default
in the due observance or performance of any material covenant, condition or
agreement on the part of the Company contained in this Note or the Purchase
Agreement (as defined below) (other than the failure to make payment when due),
and any such default shall continue for a period of sixty (60) days after the
date on which the Company receives written notice thereof from the
Holder.

    


    
      
         


      

      
         


        
          

        

      

      
         


      

       

    

    This Note is being issued pursuant to
that certain Note Purchase Agreement between the Company and the Holder, dated
as of the date hereof (the “Purchase Agreement”),
and is subject to its terms.  Capitalized terms used herein but not
defined shall have the meanings given to such terms in the Purchase
Agreement.  The Note shall rank pari passu with all other senior
existing indebtedness of the Company and, pursuant to Section 2.8 of the
Purchase Agreement, no new indebtedness which is secured or senior in right of
payment to the Notes may be issued by the Company without the consent of the
Holder.  No consent of the Holder will be required for issuances by
the Company of unsecured indebtedness that ranks pari passu with, or junior to,
the Notes.

    


    2.           Prepayment.  The
Notes may be prepaid at any time, in whole or in part, without penalty prior to
the end of the Term.

    


    3.           Attorneys’
Fees.  If the indebtedness represented by this Note or any part
thereof is collected in bankruptcy, receivership or other judicial proceedings
or if this Note is placed in the hands of attorneys for collection after
default, the Company agrees to pay, in addition to the principal and interest
payable hereunder, reasonable attorneys’ fees and costs incurred by
Holder.

    


    4.           Notices.  Any
notice, other communication or payment required or permitted hereunder shall be
in writing and shall be deemed to have been given upon delivery to the address
provided pursuant to the Purchase Agreement.

    


    5.           Notice of Proposed
Transfers.  This Note shall not be transferable by the Holder
without the prior written consent of the Company, which shall not be
unreasonably withheld.  Notwithstanding the foregoing, the Holder may
transfer this Note to one or more of its members, if the transferee agrees in
writing to be subject to the terms hereof to the same extent as if such
transferee were the original Holder hereunder.  Each certificate
evidencing the Note transferred as above provided shall bear an appropriate
restrictive legend, except that the Note shall not bear such restrictive legend
if, in the opinion of counsel for the Company, such legend is not required in
order to establish compliance with any provisions of the Securities
Act.

    


    6.           Acceleration.  This
Note shall become immediately due and payable if (i) the Company commences any
proceeding in bankruptcy or for dissolution, liquidation, winding-up,
composition or other relief under state or federal bankruptcy laws; or (ii)
there is any material breach of any material covenant, warranty, representation
or other term or condition of this Note or the Purchase Agreement at any time
which is not cured within the time periods permitted therein, or if no cure
period is provided therein, within sixty (60) days after the date on which the
Company receives written notice thereof from the Holder.

    


    
      
         


      

      
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    7.           No Dilution or
Impairment.  The Company will not, by amendment of its
Certificate of Incorporation or Bylaws or through any reorganization, transfer
of assets, consolidation, merger, dissolution, issue or sale of securities or
any other voluntary action, avoid or seek to avoid the observance or performance
of any of the terms of this Note, but will at all times in good faith assist in
the carrying out of all such terms and in the taking of all such action as may
be necessary or appropriate in order to protect the rights of the Holder of this
Note against dilution or other impairment.

    


    8.           Waivers.  The
Company hereby waives presentment, demand for performance, notice of
non-performance, protest, notice of protest and notice of
dishonor.  No delay on the part of the Holder in exercising any right
hereunder shall operate as a waiver of such right or any other right. This Note
is being delivered in and shall be construed in accordance with the laws of the
State of New York, without regard to the conflicts of laws provisions
thereof.

    


    9.           No Stockholder
Rights.  Nothing contained in this Note shall be construed as
conferring upon the Holder or any other person the right to vote or to consent
or to receive notice as a stockholder of the Company.

    


    10.        
Amendment.  Any
term of this Note may be amended only with the written consent of the Company
and the Holder.

    


    *  *  *  *  *

     

    
      
         


      

      
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    ISSUED as of the date first
above written.

    


     

    


    
      	 
      	PACIFIC BEACH BIOSCIENCES,
      INC.
	 
      	 
      
	 
      	
              By:

            	
              
                /s/
      J. Jay
      Lobell

              

            
	 
      	 
      	
              Name:

            	
              J.
      Jay Lobell

            
	 
      	 
      	
              Title:

            	 
      


    

    
 

     

     

     

     

     

     

      
        

      

    

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