Exhibit 10.8


 


THIS INSTRUMENT AND ANY SECURITIES
ISSUABLE PURSUANT HERETO HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),
OR UNDER THE SECURITIES LAWS OF CERTAIN STATES. THESE SECURITIES MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED
EXCEPT AS PERMITTED IN THIS SAFE AND UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
OR AN EXEMPTION THEREFROM.


 


PaxMedica, Inc.


 


SAFE 


(Simple Agreement for Future
Equity)


 


THIS CERTIFIES THAT in exchange
for the payment by Amar Foundation (the “Investor”) of $5,000,000 (the “Purchase Amount”) on or
about March 19, 2021, PaxMedica, Inc., a Delaware corporation (the “Company”), issues to the Investor the right to
certain shares of the Company’s Capital Stock, subject to the terms described below.


 


The “Post-Money
Valuation Cap” is $150,000,000.00.


 


The “Discount Rate”
is 50%.


 


See Section 2 for
certain additional defined terms.


 


1.       Events


 


(a)    Equity
Financing. If there is an Equity Financing before the termination of this Safe, on the initial closing of such Equity Financing,
this Safe will automatically convert into the number of shares of Safe Capital Stock equal to the Purchase Amount divided by the Conversion
Price.


 


In connection with the
automatic conversion of this Safe into shares of Safe Capital Stock, the Investor will execute and deliver to the Company all of the
transaction documents related to the Equity Financing; provided, that such documents (i) are the same documents to be entered
into with the purchasers of Standard Capital Stock, with appropriate variations for the Safe Capital Stock if applicable, and (ii) have
customary exceptions to any drag-along applicable to the Investor, including (without limitation) limited representations, warranties,
liability and indemnification obligations for the Investor.


 


(b)    Liquidity
Event. If there is a Liquidity Event before the termination of this Safe, the Investor will automatically be entitled (subject
to the liquidation priority set forth in Section 1(d) below) to receive a portion of Proceeds, due and payable to the Investor immediately
prior to, or concurrent with, the consummation of such Liquidity Event, equal to the greater of (i) the Purchase Amount (the “Cash-Out
Amount”) or (ii) the amount payable on the number of shares of Common Stock equal to the Purchase Amount divided by the Liquidity
Price (the “Conversion Amount”). If any of the Company’s securityholders are given a choice as to the form and
amount of Proceeds to be received in a Liquidity Event, the Investor will be given the same choice, provided that the Investor
may not choose to receive a form of consideration that the Investor would be ineligible to receive as a result of the Investor’s
failure to satisfy any requirement or limitation generally applicable to the Company’s securityholders, or under any applicable
laws.


 


Notwithstanding the foregoing,
in connection with a Change of Control intended to qualify as a tax-free reorganization, the Company may reduce the cash portion of Proceeds
payable to the Investor by the amount determined by its board of directors in good faith for such Change of Control to qualify as a tax-free
reorganization for U.S. federal income tax purposes, provided that such reduction (A) does not reduce the total Proceeds payable to such
Investor and (B) is applied in the same manner and on a pro rata basis to all securityholders who have equal priority to the Investor
under Section 1(d).


 


(c)    Dissolution
Event. If there is a Dissolution Event before the termination of this Safe, the Investor will automatically be entitled (subject
to the liquidation priority set forth in Section 1(d) below) to receive a portion of Proceeds equal to the Cash-Out Amount, due and payable
to the Investor immediately prior to the consummation of the Dissolution Event.


 






     


     


    

 


(d)    Liquidation
Priority. In a Liquidity Event or Dissolution Event, this Safe is intended to operate like standard non-participating Preferred
Stock. The Investor’s right to receive its Cash-Out Amount is:


 


(i)       Junior
to payment of outstanding indebtedness and creditor claims, including contractual claims for payment and convertible promissory notes
(to the extent such convertible promissory notes are not actually or notionally converted into Capital Stock);


 


(ii)       On
par with payments for other Safes and/or Preferred Stock, and if the applicable Proceeds are insufficient to permit full payments to
the Investor and such other Safes and/or Preferred Stock, the applicable Proceeds will be distributed pro rata to the Investor and such
other Safes and/or Preferred Stock in proportion to the full payments that would otherwise be due; and


 


(iii)       Senior
to payments for Common Stock.


 


The Investor’s right
to receive its Conversion Amount is (A) on par with payments for Common Stock and other Safes and/or Preferred Stock who are also receiving
Conversion Amounts or Proceeds on a similar as-converted to Common Stock basis, and (B) junior to payments described in clauses (i) and
(ii) above (in the latter case, to the extent such payments are Cash-Out Amounts or similar liquidation preferences).


 


(e)    Termination.
This Safe will automatically terminate (without relieving the Company of any obligations arising from a prior breach of or non-compliance
with this Safe) immediately following the earliest to occur of: (i) the issuance of Capital Stock to the Investor pursuant to the automatic
conversion of this Safe under Section 1(a); or (ii) the payment, or setting aside for payment, of amounts due to the Investor pursuant
to Section 1(b) or Section 1(c).


 


2.       Definitions


 


“Capital Stock”
means the capital stock of the Company, including, without limitation, the “Common Stock” and the “Preferred
Stock.”


 


“Change of Control”
means (i) a transaction or series of related transactions in which any “person” or “group” (within the meaning
of Section 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended), becomes the “beneficial owner” (as defined
in Rule 13d-3 under the Securities Exchange Act of 1934, as amended), directly or indirectly, of more than 50% of the outstanding voting
securities of the Company having the right to vote for the election of members of the Company’s board of directors, (ii) any
reorganization, merger or consolidation of the Company, other than a transaction or series of related transactions in which the holders
of the voting securities of the Company outstanding immediately prior to such transaction or series of related transactions retain, immediately
after such transaction or series of related transactions, at least a majority of the total voting power represented by the outstanding
voting securities of the Company or such other surviving or resulting entity or (iii) a sale, lease or other disposition of all
or substantially all of the assets of the Company.


 


“Company Capitalization”
is calculated as of immediately prior to the Equity Financing and (without double-counting, in each case calculated on an as-converted
to Common Stock basis):


 


·        
Includes all shares of Capital Stock issued and outstanding;


·        
Includes all Converting Securities;


·        
Includes all (i) issued and outstanding Options and (ii) Promised Options; and


·        
Includes the Unissued Option Pool.


 


“Conversion Price”
means the either: (1) the Safe Price or (2) the Discount Price, whichever calculation results in a greater number of shares of Safe Capital
Stock.


 


“Converting Securities”
includes this Safe and other convertible securities issued by the Company, including but not limited to: (i) other Safes; (ii) convertible
promissory notes and other convertible debt instruments; and (iii) convertible securities that have the right to convert into shares
of Capital Stock.


 






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“Discount Price”
means the price per share of the Standard Capital Stock sold in the Equity Financing multiplied by the Discount Rate.


 


“Dissolution
Event” means (i) a voluntary termination of operations, (ii) a general assignment for the benefit of the Company’s creditors
or (iii) any other liquidation, dissolution or winding up of the Company (excluding a Liquidity Event), whether voluntary
or involuntary.


 


“Dividend Amount”
means, with respect to any date on which the Company pays a dividend on its outstanding Common Stock, the amount of such dividend that
is paid per share of Common Stock multiplied by (x) the Purchase Amount divided by (y) the Liquidity Price (treating the dividend date
as a Liquidity Event solely for purposes of calculating such Liquidity Price).


 


“Equity Financing”
means a bona fide transaction or series of transactions with the principal purpose of raising capital, pursuant to which the Company
issues and sells (i) Common Stock in a Qualifying IPO or (ii) Preferred Stock, in each case at a fixed valuation, including but not limited
to, a pre-money or post-money valuation.


 


“Liquidity Capitalization”
is calculated as of immediately prior to the Liquidity Event, and (without double- counting, in each case calculated on an as-converted
to Common Stock basis):


 


		·	Includes
                                            all shares of Capital Stock issued and outstanding;



		·	Includes
                                            all (i) issued and outstanding Options and (ii) to the extent receiving Proceeds, Promised
                                            Options;



		·	Includes
                                            all Converting Securities, other than any Safes and other convertible securities
                                            (including without limitation shares of Preferred Stock) where the holders of such securities
                                            are receiving Cash-Out Amounts or similar liquidation preference payments in lieu of Conversion
                                            Amounts or similar “as-converted” payments; and



		·	Excludes
                                            the Unissued Option Pool.



 


“Liquidity Event”
means a Change of Control.


 


“Liquidity Price”
means the price per share equal to the Post-Money Valuation Cap divided by the Liquidity Capitalization.


 


“Options”
includes options, restricted stock awards or purchases, RSUs, SARs, warrants or similar securities, vested or unvested.


 


“Proceeds”
means cash and other assets (including without limitation stock consideration) that are proceeds from the Liquidity Event or the Dissolution
Event, as applicable, and legally available for distribution.


 


“Promised Options”
means promised but ungranted Options that are the greater of those (i) promised pursuant to agreements or understandings made prior to
the execution of, or in connection with, the term sheet or letter of intent for the Equity Financing or Liquidity Event, as applicable
(or the initial closing of the Equity Financing or consummation of the Liquidity Event, if there is no term sheet or letter of intent),
(ii) in the case of an Equity Financing, treated as outstanding Options in the calculation of the Standard Capital Stock’s price
per share, or (iii) in the case of a Liquidity Event, treated as outstanding Options in the calculation of the distribution of the Proceeds.


 


“Qualifying
IPO” means (i) the Company’s firm commitment underwritten initial public offering pursuant to a registration statement
filed under the Securities Act that results in gross proceeds to the Company of at least $40.0 million and (ii) the related listing of
the Common Stock on a U.S. national securities exchange.


 


“Safe”
means an instrument containing a future right to shares of Capital Stock, similar in form and content to this instrument, purchased by
investors for the purpose of funding the Company’s business operations. References to “this Safe” mean this specific
instrument.


 


“Safe Capital
Stock” means the shares of the series of Capital Stock issued to the Investor in an Equity Financing, having the identical
rights, privileges, preferences and restrictions as the shares of Standard Capital Stock, other than with respect to: (i) if any,
the per share liquidation preference and the initial conversion price for purposes of price-based anti-dilution protection, which
will equal the Conversion Price; and (ii) the basis for any dividend rights, if any, which will be based on the Conversion
Price.


 






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“Safe Price”
means the price per share equal to the Post-Money Valuation Cap divided by the Company Capitalization.


 


“Standard Capital
Stock” means the shares of the series of Capital Stock issued to the investors investing new money in the Company in connection
with the initial closing of the Equity Financing.


 


“Unissued Option
Pool” means all shares of Capital Stock that are reserved, available for future grant and not subject to any outstanding Options
or Promised Options (but in the case of a Liquidity Event, only to the extent Proceeds are payable on such Promised Options) under any
equity incentive or similar Company plan.


 


3.       Company
Representations


 


(a)    The Company is
a corporation duly organized, validly existing and in good standing under the laws of its state of incorporation, and has the power and
authority to own, lease and operate its properties and carry on its business as now conducted.


 


(b)    The execution,
delivery and performance by the Company of this Safe is within the power of the Company and has been duly authorized by all necessary
actions on the part of the Company (subject to section 3(d)). This Safe constitutes a legal, valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms, except as limited by bankruptcy, insolvency or other laws of general application
relating to or affecting the enforcement of creditors’ rights generally and general principles of equity. To its knowledge, the
Company is not in violation of (i) its current certificate of incorporation or bylaws, (ii) any material statute, rule or regulation
applicable to the Company or (iii) any material debt or contract to which the Company is a party or by which it is bound, where, in each
case, such violation or default, individually, or together with all such violations or defaults, could reasonably be expected to have
a material adverse effect on the Company.


 


(c)    The performance
and consummation of the transactions contemplated by this Safe do not and will not: (i) violate any material judgment, statute,
rule or regulation applicable to the Company; (ii) result in the acceleration of any material debt or contract to which the Company
is a party or by which it is bound; or (iii) result in the creation or imposition of any lien on any property, asset or revenue
of the Company or the suspension, forfeiture, or nonrenewal of any material permit, license or authorization applicable to the Company,
its business or operations.


 


(d)    No consents or
approvals are required in connection with the performance of this Safe, other than: (i) the Company’s corporate approvals; (ii)
any qualifications or filings under applicable securities laws; and (iii) necessary corporate approvals for the authorization of Capital
Stock issuable pursuant to Section 1.


 


(e)    To its knowledge,
the Company owns or possesses (or can obtain on commercially reasonable terms) sufficient legal rights to all patents, trademarks, service
marks, trade names, copyrights, trade secrets, licenses, information, processes and other intellectual property rights necessary for
its business as now conducted and as currently proposed to be conducted, without any conflict with, or infringement of the rights of,
others.


 


4.       Investor
Representations


 


(a)    The Investor has
full legal capacity, power and authority to execute and deliver this Safe and to perform its obligations hereunder. This Safe constitutes
valid and binding obligation of the Investor, enforceable in accordance with its terms, except as limited by bankruptcy, insolvency or
other laws of general application relating to or affecting the enforcement of creditors’ rights generally and general principles
of equity.


 






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(b)    The
Investor is an accredited investor as such term is defined in Rule 501 of Regulation D under the Securities Act, and
acknowledges and agrees that if not an accredited investor at the time of an Equity Financing, the Company may void this Safe and
return the Purchase Amount. The Investor has been advised that this Safe and the underlying securities have not been registered
under the Securities Act, or any state securities laws and, therefore, cannot be resold unless they are registered under the
Securities Act and applicable state securities laws or unless an exemption from such registration requirements is available. The
Investor is purchasing this Safe and the securities to be acquired by the Investor hereunder for its own account for investment, not
as a nominee or agent, and not with a view to, or for resale in connection with, the distribution thereof, and the Investor has no
present intention of selling, granting any participation in, or otherwise distributing the same. The Investor has such knowledge and
experience in financial and business matters that the Investor is capable of evaluating the merits and risks of such investment, is
able to incur a complete loss of such investment without impairing the Investor’s financial condition and is able to bear the
economic risk of such investment for an indefinite period of time.


 


5.       Miscellaneous


 


(a)    Any
provision of this Safe may be amended, waived or modified by written consent of the Company and either (i) the Investor or (ii) the majority-in-interest
of all then-outstanding Safes with the same “Post-Money Valuation Cap” and “Discount Rate” as this Safe (and
Safes lacking one or both of such terms will be considered to be the same with respect to such term(s)), provided that with respect
to clause (ii): (A) the Purchase Amount may not be amended, waived or modified in this manner, (B) the consent of the Investor and each
holder of such Safes must be solicited (even if not obtained), and (C) such amendment, waiver or modification treats all such holders
in the same manner. “Majority-in-interest” refers to the holders of the applicable group of Safes whose Safes have a total
Purchase Amount greater than 50% of the total Purchase Amount of all of such applicable group of Safes.


 


(b)    Any notice required
or permitted by this Safe will be deemed sufficient when delivered personally or by overnight courier or sent by email to the relevant
address listed on the signature page, or 48 hours after being deposited in the U.S. mail as certified or registered mail with postage
prepaid, addressed to the party to be notified at such party’s address listed on the signature page, as subsequently modified by
written notice.


 


(c)    The Investor is
not entitled, as a holder of this Safe, to vote or be deemed a holder of Capital Stock for any purpose other than tax purposes, nor will
anything in this Safe be construed to confer on the Investor, as such, any rights of a Company stockholder or rights to vote for the
election of directors or on any matter submitted to Company stockholders, or to give or withhold consent to any corporate action or to
receive notice of meetings, until shares have been issued on the terms described in Section 1. However, if the Company pays a dividend
on outstanding shares of Common Stock (that is not payable in shares of Common Stock) while this Safe is outstanding, the Company will
pay the Dividend Amount to the Investor at the same time.


 


(d)    Neither this Safe
nor the rights in this Safe are transferable or assignable, by operation of law or otherwise, by either party without the prior written
consent of the other; provided, however, that this Safe and/or its rights may be assigned without the Company’s consent
by the Investor (i) to the Investor’s estate, heirs, executors, administrators, guardians
and/or successors in the event of Investor’s death or disability, or (ii) to any other entity who directly or indirectly,
controls, is controlled by or is under common control with the Investor, including, without limitation, any general partner, managing
member, officer or director of the Investor, or any venture capital fund now or hereafter existing which is controlled by one or more
general partners or managing members of, or shares the same management company with, the Investor; and provided, further, that
the Company may assign this Safe in whole, without the consent of the Investor, in connection with a reincorporation to change the Company’s
domicile.


 


(e)    In the event any
one or more of the provisions of this Safe is for any reason held to be invalid, illegal or unenforceable, in whole or in part or in
any respect, or in the event that any one or more of the provisions of this Safe operate or would prospectively operate to invalidate
this Safe, then and in any such event, such provision(s) only will be deemed null and void and will not affect any other provision of
this Safe and the remaining provisions of this Safe will remain operative and in full force and effect and will not be affected, prejudiced,
or disturbed thereby.


 


(f)    All rights and
obligations hereunder will be governed by the laws of the State of Delaware, without regard to the conflicts of law provisions of such
jurisdiction.


 


(g)    The parties acknowledge
and agree that for United States federal and state income tax purposes this Safe is, and at all times has been, intended to be characterized
as stock, and more particularly as common stock for purposes of Sections 304, 305, 306, 354, 368, 1036 and 1202 of the Internal Revenue
Code of 1986, as amended. Accordingly, the parties agree to treat this Safe consistent with the foregoing intent for all United States
federal and state income tax purposes (including, without limitation, on their respective tax returns or other informational statements).


 


(Signature page follows)


 






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IN WITNESS WHEREOF, the undersigned have caused
this Safe to be duly executed and delivered.


 


	 	PaxMedica, Inc.
	 	 
	 	By: 	/s/ Howard J. Weisman
	 	 	Howard J. Weisman
	 	 	Chief Executive Officer



 


	 	Address: PaxMedica, Inc.
	 	50 Tice Boulevard, Suite A26
	 	Woodcliff Lake, NJ 07677
	 	 
	 	Email: HWeisman@paxmedica.com


 


	 	INVESTOR:
	 	 
	 	Amar Foundation
	 	 	 
	 	By:	/s/ Vinod Khosla
	 	Name: 	Vinod Khosla
	 	Title: 	Secretary
	 	 	 
	 	Address: Amar Foundation
	 	1760 The Alameda, Suite 300
	 	San Jose, CA 95126
	 	 
	 	Email:	kim@mccabetotah.com