Exhibit 10.10
STOCK PLEDGE AGREEMENT
THIS STOCK PLEDGE AGREEMENT (this
“Agreement”),
dated as of August 2, 2018, by the parties identified on Schedule A
(each a “Pledgor” and
collectively the “Pledgors”) for
the benefit of Grushko & Mittman, P.C. (“Pledgee”), as
Pledgee acting on behalf of the Holders (as defined
below);
WITNESSETH:
WHEREAS, GT Biopharma, Inc., a Delaware
corporation (the “Company”)
issued Convertible Notes on or about the date of this agreement, in
the original aggregate principal amount of $6,982,358.62 (the
“Notes”) to
various holders of the Notes (the “Holders”) as
set forth on Schedule B in consideration of loans made to the
Company by the Holders (“Loans”), and
the Pledgors have agreed to secure the Company’s obligations
under the Notes by granting to the Holders a security interest in
the shares of the Company (the “Shares”) as
set forth on Schedule A;
WHEREAS, the
Holders and Pledgee agree and acknowledge that Pledgee shall accept
the Pledged Securities (as defined in Paragraph 3(a) of this
Agreement) on behalf of the Holders to facilitate delivery and
shall also act as Collateral Agent for the Holders, and Pledgee
acknowledges that it is accepting the Pledged Securities on behalf
of the Holders;
WHEREAS, Pledgors are affiliates of the
Company and will have significant benefit from the
Loans;
NOW, THEREFORE, in consideration of the
Loans made and to be made by Holders and the promises and the
mutual covenants herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:
1. Definitions.
The
following terms shall have the following meanings wherever used in
this Agreement:
a) “Event of Default” shall
have the meaning given thereto in the Notes.
b) “Common Stock” means the
common stock of the Company, $0.001 par value per share, and any
other class of securities into which such securities may hereafter
be reclassified or changed.
c) “Conversion Price” shall
have the meaning set forth in the Notes.
d) “Conversion Shares” shall
mean shares of Common Stock acquired upon conversion of the
Notes.
e) “Holder
Majority” shall mean Holders holding a majority of the
then outstanding principal amount of the Notes.
f) “Maturity Date” shall have
the meaning given thereto in the Notes.
g) “Obligations” shall mean
an amount equal to (i) 150% of all principal and interest and other
payments which may be due and payable under this Agreement or the
Notes on the Maturity Date; and (ii) 125% of the aggregate
Conversion Price at which Conversion Shares are acquired prior to
the Maturity Date less the proceeds of any sales of such Conversion
Shares prior to the Maturity Date, calculated separately for each
Conversion Share (e.g. if a Holder acquires 1,000 shares with a per
share Conversion Price of $2.00, the Obligations on such shares
shall be $2,500. If such Holder sells such shares for $1,900 the
remaining Obligation would be $600. If such Holder sells such
shares for $2,500, or more, the Obligation on such Shares would be
satisfied.). For the purposes of calculating the Obligations
pursuant to part (ii) of the previous sentence, any Conversion
Shares held on the Maturity Date will be valued as if sold at the
VWAP on the Maturity Date.
h) “Satisfaction Date” shall
mean that date on which all the Obligations have been paid or
otherwise satisfied in full.
i) “Trading Market” means any
of the following markets, quotation services, or exchanges: the
NYSE MKT LLC, the Nasdaq Capital Market, the Nasdaq Global Market,
the Nasdaq Global Select Market, the New York Stock Exchange, the
OTC Bulletin Board, OTCQB, or the OTCQX (or any successors to any
of the foregoing).
j) “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 any of the NASDAQ markets or exchanges is not a Trading Market,
the volume weighted average price of the Common Stock for such date
(or the nearest preceding date) on the OTC Bulletin Board, (c) if
the Common Stock is not then listed or quoted for trading on the
OTC Bulletin Board and if prices for the Common Stock are then
reported on the OTCQX, OTCQB or OTC Pink Marketplace maintained by
the OTC Markets Group, Inc. (or a similar organization or agency
succeeding to its functions of reporting prices), the volume
weighted average price of the Common Stock on the first such
facility (or a similar organization or agency succeeding to its
functions of reporting prices), or (d) in all other cases, the fair
market value of a share of Common Stock as determined by an
independent appraiser selected in good faith by the
Pledgee.
2. [Reserved].
3. Pledge of the Pledged
Securities/Additional Deposits.
(a) As security for the
due and timely payment of the Obligations, each Pledgor hereby,
pledges to the Pledgee, and grants to the Pledgee a first priority
lien and security interest in its portion of the Shares (as same
are constituted from time to time), together with all cash
dividends, stock dividends, interest, profits, premiums,
redemptions, warrants, subscription rights, options, substitutions,
exchanges and other distributions now or hereafter made on the
Shares and all cash and non-cash proceeds thereof(collectively, the
“Distributions”), until the Satisfaction Date. The
Shares and all property at any time pledged to the Pledgee
hereunder or in which the Pledgee is granted a security interest
(whether described herein or not) and all income therefrom and
proceeds thereof are herein collectively called the
“Pledged
Securities”. Pledgee’s receipt of, or
entitlement to, the Distributions shall not increase the amount of
the Obligations due to the Holders.
(b) In furtherance of
the pledge hereunder, within 30 days after the Closing Date (as
defined in the Notes), each Pledgor will deliver to the Pledgee the
certificates representing all of the Pledged Securities, each of
which now remains in the name of the Pledgors and is accompanied by
appropriate undated medallion guaranteed stock powers duly endorsed
in blank by the Pledgors.
(c) If,
while this Agreement is in effect, a Pledgor becomes entitled to
receive or receives any stock certificate (including, without
limitation, any certificate representing a stock dividend or a
distribution in connection with any reclassification, increase or
reduction of capital or issued in connection with any
reorganization), option or rights, whether as an addition to, in
substitution of, or in exchange for, any Pledged Securities or
otherwise, the Pledgor agrees to accept the same as agent for the
Pledgee, to hold the same in trust on behalf of and for the benefit
of the Pledgee, and upon request from Pledgee, deliver the same
promptly upon receipt to the Pledgee in the exact form received,
with the endorsement of the Pledgor when necessary and/or
appropriate undated stock powers duly executed in blank, to be held
by the Pledgee, subject to the terms hereof, as additional
collateral security for the Obligations. Any sums paid on or in
respect of the Pledged Securities on the liquidation or dissolution
of the Company shall be paid over to the Pledgee, to be held by the
Pledgee, subject to the terms and conditions hereof, as additional
collateral security for the Obligations.
4. Retention of the Pledged
Securities.
(a) Except as otherwise
provided herein, the Pledgee shall have no obligation with respect
to the Pledged Securities, except to use reasonable care in the
custody and preservation thereof, to the extent required by
law.
(b) The Pledgee shall
hold the Pledged Securities in the form in which same are delivered
herewith, unless and until there shall occur an Event of
Default.
5. Rights of the Pledgors.
Throughout the term of this Agreement, so long as no Event of
Default has occurred and is continuing, the Pledgors shall have the
right to vote the Pledged Securities in all matters presented to
the stockholders of the Company for vote thereon and to receive the
Distributions, except in a manner inconsistent with the terms of
this Agreement.
6. Event of Default; Power of
Attorney.
(a) Upon the occurrence
and during the continuance of any Event of Default, the Pledgee
shall have the right, subject to the Beneficial Ownership
Limitation, to: (i) exercise all voting and corporate rights of,
and all rights of conversion, exchange, subscription or any other
rights, privileges or options pertaining to, any Pledged Securities
as if the Pledgee was the absolute owner thereof, including
(without limitation) the right to exchange, at its discretion, any
and all of the Pledged Securities upon the merger, consolidation,
reorganization, recapitalization or other readjustment of the
Company or upon the exercise by the Holders or the Pledgee of any
right, privilege or option pertaining to any of the Pledged
Securities and, in connection therewith, to deposit and deliver any
and all of the Pledged Securities with any committee, depository,
transfer agent, registrar or other designated agency on such terms
and conditions as the Pledgee may determine, all without liability
except to account for property actually received by it; (ii) apply
any funds or other property received in respect of the Pledged
Securities to the Obligations, and receive in its own name any and
all further distributions which may be paid in respect of the
Pledged Securities, all of which shall, upon receipt by the
Pledgee, be applied to the Obligations; (iii) transfer all or any
portion of the Pledged Securities (as determined by the Pledgee in
its discretion) on the books of the Company to and in the name of
the Pledgee or such other person or persons as the Pledgee may
designate; (iv) effect any sale, transfer or disposition of all or
any portion of the Pledged Securities and in furtherance thereof,
take possession of and endorse any and all checks, drafts, bills of
exchange, money orders or other documents and instruments received
on account of the Pledged Securities; (v) collect, sue for and give
acquittance for any money due on account of any of the foregoing;
and (vi) take any and all other action contemplated by this
Agreement, or as otherwise permitted by law, or as the Pledgee may
reasonably deem necessary or appropriate, in order to accomplish
the purposes of this Agreement. Nothing in this Agreement, and
notwithstanding any remedy described herein, shall entitle the
Pledgees to receipt of any amount which exceeds the total amount
due for the Obligations. To the extent Pledgees, in liquidating the
Pledged Securities receive any amount in excess of that owed
pursuant to the Obligations, it shall be paid to and returned to
the Pledgors pro rata with respect to the shares which have been
taken by the Pledgees.
(b) In furtherance of
the foregoing powers of the Pledgee, the Pledgors hereby authorizes
and appoints the Pledgee, with full powers of substitution, as the
true and lawful attorney-in-fact of the Pledgors, in his name,
place and stead, to take any and all such action as the Pledgee, in
its sole discretion, may deem necessary or appropriate in
furtherance of the exercise of the aforesaid powers. Such power of
attorney shall be coupled with an interest and shall be irrevocable
until the Satisfaction Date. Without limitation of the foregoing,
such power of attorney shall not in any manner be affected or
impaired by reason of any act of the Pledgors or by operation of
law. Nothing herein contained, however, shall be deemed to require
or impose any duty upon the Pledgee to exercise any of the rights
or powers granted herein.
(c) The foregoing
rights and powers granted to the Pledgee, and the foregoing power
of attorney, shall be fully binding upon any person who may acquire
any beneficial interest in any of the Pledged Securities or any
other property held or received by the Pledgee
hereunder.
7. Foreclosure; Sale of Pledged
Securities.
(a) Without
limitation of Section 6 above, in the event that the Pledgee shall
make any sale or other disposition of any or all of the Pledged
Securities following an Event of Default, the Pledgee may, subject
to Beneficial Ownership Limitation, also:
(i) assign
all or any portion of the Pledged Securities to the Holders pro
rata to the then outstanding principle amount of the Notes. The
Pledged Securities will be valued based on the VWAP of the Shares
on the Maturity Date.
(ii) offer
and sell all or any portion of the Pledged Securities publicly
through a registered broker-dealer, or by means of a private
placement restricting the offer or sale to a limited number of
prospective purchasers who meet such suitability standards as the
Pledgee and its counsel may deem appropriate, and who may be
required to represent that they are purchasing Pledged Securities
for investment and not with a view to distribution;
(iii) sell
any or all of the Pledged Securities upon credit or for future
delivery, without being in any way liable for failure of the
purchaser to pay for the subject Pledged Securities;
and
(iv)
receive and collect the net proceeds of any sale or other
disposition of any Pledged Securities and apply same in such order
and to such of the Obligations (including the customary costs and
expenses of the sale or disposition of the Pledged Securities) as
the Pledgee may, in its absolute discretion, deem appropriate, with
the excess of any amount received which is over the amount owed
pursuant to the Obligations paid to the Pledgors in the same
proportion as Pledgees have received their Pledged
Securities.
(b) Upon
any sale of any of the Pledged Securities in accordance with this
Agreement, the Pledgee shall have the right to assign, transfer and
deliver the subject Pledged Securities to the purchaser(s) thereof,
and each such purchaser shall be entitled to hold such Pledged
Securities absolutely free from any right or claim of the Pledgors
and/or any other person claiming any beneficial interest in the
Pledged Securities, including any equity of redemption (which right
and all other such rights are hereby waived by the Pledgors to the
fullest extent permitted by law).
(c) Following
the occurrence and during the existence of an Event of Default,
Pledgors will cooperate and provide such certificate, resolutions,
representations, legal opinions and all other matters necessary to
facilitate a transfer or sale of any part of the Pledged
Securities.
(d) Nothing
herein contained shall be deemed to require the Pledgee to affect
any sale or disposition of any Pledged Securities at any time, or
to consummate any proposed public or private sale at the time and
place at which same was initially called. It is the intention of
the parties hereto that the Pledgee shall, subject to any further
conditions imposed by this Agreement, at all times following the
occurrence of an Event of Default, have the right to use or deal
with the Pledged Securities as if the Pledgee were the outright
owner thereof, and to exercise any and all rights and remedies, as
a secured party in possession of collateral or otherwise, under any
and all provisions of law. Provided, however, that all sale
proceeds of the Pledged Securities shall be credited against the
Obligations, and if Pledgees do not sell or dispose of the Pledged
Securities within three (3) months of foreclosing on
Pledgees’ lien, then Pledgors shall be credited with an
amount equal to the greater of the VWAP on the (i) date of Pledgees
foreclose on the Pledged Securities, (ii) on the date of an Event
of Default or (iii) the Maturity Date. Each Pledgor shall receive
its pro rata share of the credit.
(e) The
Pledgee may take action and exercise rights in connection with any
portion of the Pledged Securities regardless of the proportion in
which any Pledgor has provided Pledged Securities.
8. Covenants, Representations and
Warranties. In connection with the transactions contemplated
by this Agreement, and knowing that the Pledgee is and shall be
relying hereon, each Pledgor hereby covenants, represents and
warrants that:
(a) Such
pledgor’s portion of the Pledged Securities has been and will
be duly and validly issued, is and will be fully paid and
non-assessable, and is and will be owned by such Pledgor free and
clear of any and all restrictions, pledges, liens, encumbrances or
other security interests of any kind, save and except for the
pledge to the Pledgee pursuant to this Agreement;
(b) there are and will
be no options, warrants or other rights in respect of the sale,
transfer or other disposition of any of such Pledgor’s
portion of the Pledged Securities by such Pledgor, and such Pledgor
has the absolute right to pledge its portion of the Pledged
Securities hereunder without the necessity of any consent of any
Person;
(c) neither the
execution or delivery of this Agreement, nor the consummation of
the transactions contemplated hereby, nor the compliance with or
performance of this Agreement by such Pledgor, conflicts with or
will result in the breach or violation of or a default under the
terms, conditions or provisions of (i) any mortgage, security
agreement, indenture, evidence of indebtedness, loan or financing
agreement, or other agreement or instrument to which such Pledgor
is a party or by which such Pledgor is bound, or (ii) any provision
of law, any order of any court or administrative agency, or any
rule or regulation applicable to such Pledgor;
(d) this Agreement has
been duly executed and delivered by such Pledgor, and constitutes
the legal, valid and binding obligation of such Pledgor,
enforceable against such Pledgor in accordance with its
terms;
(e) there are no
actions, suits or proceedings pending or threatened against or
affecting such Pledgor that involve or relate to the Pledged
Securities; and
(f) upon
execution of this Agreement by such Pledgor, the Pledgee shall have
the senior security interest in such Pledgor’s portion of the
Pledged Securities.
9. UCC Filings. Pledgors hereby
grant to Pledgee the right and authority to file an UCC Financing
Statement any state to memorialize the security interest herein
granted.
10. Return of the Pledged
Securities. To the extent that the Pledgee shall not
previously have taken, acquired, sold, transferred, disposed of or
otherwise realized value on the Pledged Securities in accordance
with this Agreement, at the Satisfaction Date, any security
interest in the Pledged Securities shall automatically terminate,
cease to exist and be released, and the Pledgee shall forthwith
return the Pledged Securities to the relevant Pledgor and Pledgors
may file any releases of Pledgee’s security interest in the
Pledged Securities as required. In addition, Pledgees agree they
will take, acquire, sell, transfer and dispose of only so many of
the Pledged Securities which are necessary to fully pay the
Obligations, with the security interest granted by this Agreement
immediately, and with no further action required to be taken by
either party, being released, cancelled and satisfied.
11. Expenses of the Pledgee. All
expenses incurred by the Pledgee (including but not limited to
reasonable attorneys’ fees) in connection with any actual or
attempted sale or other disposition of Pledged Securities hereunder
shall be reimbursed to the Pledgee by the Pledgors on demand, or,
at the Pledgee’s option, such expenses may be added to the
Obligations and shall be payable on demand.
12. Further Assurances. From time
to time hereafter, each party shall take any and all such further
action and shall execute and deliver any and all such further
documents and/or instruments, as any other party may request in
order to accomplish the purposes of and fulfill the parties’
obligations under this Agreement, in order to enable the Pledgee to
exercise any of its rights hereunder, and/or in order to secure
more fully the Pledgee’s interest in the Pledged
Securities.
13. Collateral
Agent. The Holders hereby
appoint Pledgee to act as their agent (“Collateral
Agent”) for purposes of
exercising any and all rights and remedies of the Pledgee or
Holders hereunder. Such appointment shall continue until revoked in
writing by a Holder Majority, at which time a Holder Majority shall
appoint a new Collateral Agent. The Collateral Agent shall have the
rights, responsibilities and immunities set forth in
Annex
C hereto.
14. Company Undertaking. The
Company consents to the transactions contemplated by this
Agreement. The Company hereby undertakes to take all steps
necessary or convenient to allow the Pledgee and Holders to
exercise their rights under this Agreement including providing any
opinions necessary to transfer any portion of the Pledged
Securities including, if permissible under the securities laws,
acknowledging any tacking of the Pledgors’ holding periods of
the Pledged Securities to the holding periods of the Pledgee and
Holders.
15. Transfer Limitations. The
Company shall not affect any transfer of the Shares, and the
Pledgee and Holders shall not have the right to acquire any portion
of the Shares, to the extent that after giving effect to such
transfer, the Pledgee or Holder (together with such Party’s
affiliates, and any persons acting as a group together with such
Party or any of such Party’s affiliates) would beneficially
own in excess of the Beneficial Ownership Limitation (as defined
below). For purposes of the foregoing sentence, the number of
shares of Common Stock beneficially owned by a Party and its
affiliates shall include the number of shares of Common Stock
issuable upon transfer of the Shares with respect to which such
determination is being made, but shall exclude the number of shares
of Common Stock which are transferable upon (i) transfer of the
remaining, untransferred Shares and (ii) exercise or sale of the
unexercised or unconverted portion of any other securities of the
Company subject to a limitation on sale or exercise analogous to
the limitation contained herein (including, without limitation, any
other Common Stock, notes, warrants, or other convertible security)
beneficially owned by such Party or any of its affiliates. Except
as set forth in the preceding sentence, for purposes of this
Paragraph, beneficial ownership shall be calculated in accordance
with Section 13(d) of the Exchange Act and the rules and
regulations promulgated thereunder. To the extent that the
limitation contained in this paragraph applies, the determination
of whether the Shares are transferable (in relation to other
securities owned by a Holder together with any affiliates) shall be
in the sole discretion of each Holder, and the submission of a
notice to transfer or accept any portion of the Shares shall be
deemed to be such Party’s determination of whether such
Shares may be transferred (in relation to other securities owned by
such Party together with any affiliates), in each case subject to
the Beneficial Ownership Limitation. To ensure compliance with this
restriction, the Pledgee will be deemed to represent to the Company
each time it delivers a notice to transfer any of the Shares that
such notice has not violated the restrictions set forth in this
paragraph and the Pledgors and Company shall have no obligation to
verify or confirm the accuracy of such determination. In addition,
a determination as to any group status as contemplated above shall
be determined in accordance with Section 13(d) of the Exchange Act
and the rules and regulations promulgated thereunder. For purposes
of this section, in determining the number of outstanding shares of
Common Stock, the Parties may rely on the number of outstanding
shares of Common Stock as stated in the most recent of the
following: (i)
Company’s most recent periodic or annual
report filed with the Commission, as the case may be, (ii) a more
recent public announcement by Company, or (iii) a more recent
written notice by Company or Company’s transfer agent setting
forth the number of shares of Common Stock outstanding. The
“Beneficial
Ownership Limitation” shall be 9.99% of the number of
shares of the Common Stock outstanding immediately after giving
effect to the transfer of shares of Common Stock pursuant to this
Agreement. The Pledgee or any Holder may decrease the Beneficial
Ownership Limitation, as to such Party, at any time and the Pledgee
or any Holder, upon not less than 61 days’ prior notice to
Pledgors and the Company, and, if the Beneficial Ownership
Limitation was previously decreased, Pledgee or Holder may increase
the Beneficial Ownership Limitation provided that the Beneficial
Ownership Limitation in no event exceeds 9.99% of the number of
shares of the Common Stock outstanding immediately after giving
effect to the transfer of shares of Common Stock upon transfer of
any Shares held by the Pledgors and the Beneficial Ownership
Limitation provisions of this section shall continue to apply. Any
such increase will not be effective until the 61st day after such
notice is delivered to the Pledgors and Company. The Beneficial
Ownership Limitation provisions of this paragraph shall be
construed and implemented in a manner otherwise than in strict
conformity with the terms of this section to correct this paragraph
(or any portion hereof) which may be defective or inconsistent with
the intended Beneficial Ownership Limitation contained herein or to
make changes or supplements necessary or desirable to properly give
effect to such limitation.
16.
Miscellaneous
(a) All
notices, demands, requests, consents, approvals, and other
communications required or permitted hereunder shall be in writing
and, unless otherwise specified herein, shall be (i) personally
served, (ii) deposited in the mail, registered or certified, return
receipt requested, postage prepaid, (iii) delivered by reputable
air courier service with charges prepaid, or (iv) transmitted by
hand delivery, telegram, or facsimile, addressed as set forth below
or to such other address as such party shall have specified most
recently by written notice. Any notice or other communication
required or permitted to be given hereunder shall be deemed
effective (a) upon hand delivery or delivery by facsimile, with
accurate confirmation generated by the transmitting facsimile
machine, at the address or number designated below (if delivered on
a business day during normal business hours where such notice is to
be received), or the first business day following such delivery (if
delivered other than on a business day during normal business hours
where such notice is to be received) or (b) on the second business
day following the date of mailing by express courier service, fully
prepaid, addressed to such address, or upon actual receipt of such
mailing, whichever shall first occur. The addresses for such
communications shall be:
(i)
if
to Pledgors to the address set forth on Schedule A, with a copy
which shall not constitute notice to:
DLA
Piper LLP
401
Congress Avenue, Suite 2500
Austin,
Texas 78701-3799
Attn: Jenifer Renzenbrink Smith, Esq.
Email: jenifer.smith@dlapiper.com
(ii) if
to Pledgee to:
Grushko
& Mittman, P.C.
515
Rockaway Avenue
Valley
Stream, New York 11581
Attn:
Eliezer Drew, Esq.
Email:
eli@grushkomittman.com
With
a copy which shall not constitute notice to:
Grushko
& Mittman, P.C.
515
Rockaway Avenue
Valley
Stream, New York 11581
Attn:
Edward M. Grushko, Esq.
Email: ed@grushkomittman.com
(iii) if
the Company to:
GT
Biopharma, Inc.
1825 K
Street, Suite 510
Washington, D.C.
20006
Attn:
Steven Weldon, CFO
Email:
sww@gtbiopharma.com
With
a copy which shall not constitute notice to:
DLA
Piper LLP
401
Congress Avenue, Suite 2500
Austin,
Texas 78701-3799
Attn: Jenifer Renzenbrink Smith, Esq.
Email: jenifer.smith@dlapiper.com
(iv)
if to the Holders
to the address set forth on Schedule
B, with a copy which shall not constitute notice
to:
Grushko
& Mittman, P.C.
515
Rockaway Avenue
Valley
Stream, New York 11581
Attn:
Edward M. Grushko, Esq.
Email: ed@grushkomittman.com
(b) If
any notice to Pledgors of the sale or other disposition of Pledged
Securities is required by then applicable law, five (5) business
days prior written notice (which Pledgors agree is reasonable
notice within the meaning of Section 9-504(3) of the Uniform
Commercial Code) to Pledgors of the time and place of any sale or
transfer of Pledged Securities which Pledgors agree may be by
private sale. The rights granted in this section are in addition to
any and all rights available to Pledgee under the Uniform
Commercial Code.
(c) The
laws of the State of New York including but not limited to Article
9 of the Uniform Commercial Code as in effect from time to time,
shall govern the construction and enforcement of this Agreement and
the rights and remedies of the parties hereto. The parties hereby
consent to the exclusive jurisdiction of all courts sitting in the
State and County of New York, in connection with any action or
proceeding under or relating to this Agreement and waive trial by
jury in any such action or proceeding.
(d) This
Agreement shall be binding upon and shall inure to the benefit of
the parties hereto and their respective heirs, executors,
administrators, personal representatives, successors and permitted
assigns. The Pledgors shall not, however, assign any of his rights
or obligations hereunder without the prior written consent of the
Pledgee, and the Pledgee shall not assign its rights hereunder
without simultaneously assigning its obligations hereunder to the
subject assignee. Except as otherwise referred to herein, this
Agreement, and the documents executed and delivered pursuant
hereto, constitute the entire agreement between the parties
relating to the specific subject matter hereof.
(e) Neither
any course of dealing between the Pledgors and the Pledgee nor any
failure to exercise, or any delay in exercising, on the part of the
Pledgee, any right, power or privilege hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any
right, power or privilege operate as a waiver of any other exercise
of such right, power or privilege or any other right, power or
privilege.
(f) The
Pledgee’s rights and remedies, whether hereunder or pursuant
to any other agreements or by law or in equity, shall be cumulative
and may be exercised singly or concurrently.
(g) No
change, amendment, modification, waiver, assignment of rights or
obligations, cancellation or discharge hereof, or of any part
hereof, shall be valid unless the Pledgee shall have consented
thereto in writing.
(h) The
captions and section headings in this Agreement are for convenience
of reference only, and shall not in any way define, limit or
describe the construction, terms or provisions of this
Agreement.
(i) This
Agreement may be executed in two or more counterparts, all of which
when taken together shall be considered one and the same agreement
and shall become effective when counterparts have been signed by
each party and delivered to the other party, it being understood
that both parties need not sign the same counterpart. In the event
that any signature is delivered by facsimile or PDF email
transmission, such signature shall create a valid and binding
obligation of the party executing (or on whose behalf such
signature is executed) the same with the same force and effect as
if such facsimile signature page were an original
thereof.
(j) If
any provision of this Agreement is held invalid or unenforceable,
either in its entirety or by virtue of its scope or application to
given circumstances, such provision shall thereupon be deemed
modified only to the extent necessary to render same valid, or not
applicable to given circumstances, or excised from this Agreement,
as the situation may require, and this Agreement shall be construed
and enforced as if such provision had been included herein as so
modified in scope or application, or had not been included herein,
as the case may be.
[REST
OF THIS PAGE LEFT INTENTIONALLY BLANK]
IN WITNESS WHEREOF, the parties hereto
have executed this Stock Pledge Agreement on and as of the date
first set forth above.
PLEDGORS
Steven
Weldon
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Anthony
Cataldo
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Pledgor
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Pledgor
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Dr. Raymond
Urbanski
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Dr. Kathleen
Clarence-Smith
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Pledgor
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Pledgor
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Mark
Silverman
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Pledgor
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PLEDGEE
COMPANY
GT Biopharma,
Inc.
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By: Steven
Weldo
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Its:
CFO
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[Holders
signature page follows]
IN WITNESS WHEREOF, the parties hereto
have executed this Stock Pledge Agreement on and as of the date
first set forth above.
HOLDER
Name of Holder:
_______________________________________________________________________
Signature of Authorized Signatory of Holder:
________________________________________________
Name of Authorized Signatory:
__________________________________________________________
Title of Authorized Signatory:
___________________________________________________________
SCHEDULE A
Pledgor
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Steven
Weldon
100
South Ashley Drive, Suite 600
Tampa,
FL 33602
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2,566,835
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Anthony
Cataldo
100
South Ashley Drive, Suite 600
Tampa,
FL 33602
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5,143,036
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Dr.
Raymond Urbanski
100
South Ashley Drive, Suite 600
Tampa,
FL 33602
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1,528,898
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Dr.
Kathleen Clarence-Smith
100
South Ashley Drive, Suite 600
Tampa,
FL 33602
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8,505,633
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Mark
Silverman
100
South Ashley Drive, Suite 600
Tampa,
FL 33602
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8,172,079
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Total
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25,916,481
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ANNEX C to STOCK PLEDGE AGREEMENT
THE COLLATERAL AGENT
1. Appointment.
The Holders (all capitalized terms used herein and not otherwise
defined shall have the respective meanings provided in the Stock
Pledge to which this Annex C is attached (the
“Agreement”),
by their acceptance of the benefits of the Agreement, hereby
designate Grushko & Mittman, P.C. (“Collateral
Agent”) as the Collateral
Agent to act as specified herein and in the Agreement. Each Holder
shall be deemed irrevocably to authorize the Collateral Agent to
take such action on its behalf under the provisions of the
Agreement and to exercise such powers and to perform such duties
hereunder and thereunder as are specifically delegated to or
required of the Collateral Agent by the terms hereof and thereof
and such other powers as are reasonably incidental thereto. The
Collateral Agent may perform any of its duties hereunder by or
through its agents or employees.
2. Nature
of Duties. The Collateral Agent
shall have no duties or responsibilities except those expressly set
forth in the Agreement. Neither the Collateral Agent nor any of its
partners, members, shareholders, officers, directors, employees or
agents shall be liable for any action taken or omitted by it as
such under the Agreement or hereunder or in connection herewith or
therewith, be responsible for the consequence of any oversight or
error of judgment or answerable for any loss, unless caused solely
by its or their gross negligence or willful misconduct as
determined by a final judgment (not subject to further appeal) of a
court of competent jurisdiction. The duties of the Collateral Agent
shall be mechanical and administrative in nature; the Collateral
Agent shall not have by reason of the Agreement or any other
document a fiduciary relationship in respect of any Pledgor or any
Holder; and nothing in the Agreement or any other document,
expressed or implied, is intended to or shall be so construed as to
impose upon the Collateral Agent any obligations in respect of the
Agreement or any other document except as expressly set forth
herein and therein.
3. Lack
of Reliance on the Collateral Agent. Independently and without reliance upon the
Collateral Agent, each Holder, to the extent it deems appropriate,
has made and shall continue to make (i) its own independent
investigation of the financial condition and affairs of the Company
and its subsidiaries in connection with such Holder’s
investment in the Company, the creation and continuance of the
Obligations, the transactions contemplated by the Notes, and the
taking or not taking of any action in connection therewith, and
(ii) its own appraisal of the creditworthiness of the Company and
its subsidiaries, and of the value of the Pledged Securities from
time to time, and the Collateral Agent shall have no duty or
responsibility, either initially or on a continuing basis, to
provide any Holder with any credit, market or other information
with respect thereto, whether coming into its possession before any
Obligations are incurred or at any time or times thereafter. The
Collateral Agent shall not be responsible to the Company, any
Pledgor or any Holder for any recitals, statements, information,
representations or warranties herein or in any document,
certificate or other writing delivered in connection herewith, or
for the execution, effectiveness, genuineness, validity,
enforceability, perfection, collectability, priority or sufficiency
of the Agreement or any other document, or for the financial
condition of the Company or Pledgors or the value of any of the
Pledged Securities, or be required to make any inquiry concerning
either the performance or observance of any of the terms,
provisions or conditions of the Agreement or any other document, or
the financial condition of the Pledgors, or the value of any of the
Pledged Securities, or the existence or possible existence of any
default or Event of Default under the Agreement, the Notes or any
of the other documents.
4. Certain
Rights of the Collateral Agent.
The Collateral Agent shall have the right to take any action with
respect to the Pledged Securities, on behalf of all of the Holders.
To the extent practical, the Collateral Agent shall request
instructions from the Holders with respect to any material act or
action (including failure to act) in connection with the Agreement
or any other document, and shall be entitled to act or refrain from
acting in accordance with the instructions of Holders holding a
Holder Majority; if such instructions are not provided despite the
Collateral Agent’s request therefor, the Collateral Agent
shall be entitled to refrain from such act or taking such action,
and if such action is taken, shall be entitled to appropriate
indemnification from the Holders in respect of actions to be taken
by the Collateral Agent; and the Collateral Agent shall not incur
liability to any person or entity by reason of so refraining.
Without limiting the foregoing, (a) no Holder shall have any right
of action whatsoever against the Collateral Agent as a result of
the Collateral Agent acting or refraining from acting hereunder in
accordance with the terms of the Agreement or any other document,
and the Pledgors shall have no right to question or challenge the
authority of, or the instructions given to, the Collateral Agent
pursuant to the foregoing and (b) the Collateral Agent shall not be
required to take any action which the Collateral Agent believes (i)
could reasonably be expected to expose it to personal liability or
(ii) is contrary to this Agreement, the Notes or applicable
law.
5. Reliance.
The Collateral Agent shall be entitled to rely, and shall be fully
protected in relying, upon any writing, resolution, notice,
statement, certificate, telex, teletype or telecopier message,
cablegram, radiogram, order or other document or telephone message
signed, sent or made by the proper person or entity, and, with
respect to all legal matters pertaining to the Agreement and any
other documents and its duties thereunder, upon advice of counsel
selected by it and upon all other matters pertaining to this
Agreement and any other documents and its duties thereunder, upon
advice of other experts selected by it. Anything to the contrary
notwithstanding, the Collateral Agent shall have no obligation
whatsoever to any Holder to assure that the Pledged Securities
exists or are owned by the Pledgors or is cared for, protected or
insured or that the liens granted pursuant to the Agreement have
been properly or sufficiently or lawfully created, perfected, or
enforced or are entitled to any particular
priority.
6. Indemnification.
To the extent that the Collateral Agent is not reimbursed and
indemnified by the Pledgors, the Holders will jointly and severally
reimburse and indemnify the Collateral Agent, in proportion to
their initially purchased respective principal amounts of Notes,
from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever which may be imposed
on, incurred by or asserted against the Collateral Agent in
performing its duties hereunder or under the Agreement or any other
document, or in any way relating to or arising out of the Agreement
or any other document except for those determined by a final
judgment (not subject to further appeal) of a court of competent
jurisdiction to have resulted solely from the Collateral
Agent’s own gross negligence or willful misconduct. Prior to
taking any action hereunder as Collateral Agent, the Collateral
Agent may require each Holder to deposit with it sufficient sums as
it determines in good faith is necessary to protect the Collateral
Agent for costs and expenses associated with taking such
action.
7. Resignation
by the Collateral Agent.
(a) The
Collateral Agent may resign from the performance of all its
functions and duties under the Agreement and any other documents at
any time by giving 5 days’ prior written notice (as provided
in the Agreement) to the Pledgors and the Holders. Such resignation
shall take effect upon the appointment of a successor Collateral
Agent pursuant to clauses (b) and (c) below.
(b) Upon
any such notice of resignation, the Holders, acting by Holder
Majority, shall appoint a successor Collateral Agent
hereunder.
(c) If
a successor Collateral Agent shall not have been so appointed
within said 5-day period, the Collateral Agent shall then appoint a
successor Collateral Agent who shall serve as Collateral Agent
until such time, if any, as the Holders appoint a successor
Collateral Agent as provided above. If a successor Collateral Agent
has not been appointed within such 5-day period, the Collateral
Agent may petition any court of competent jurisdiction or may
interplead the Company, Pledgors and the Holders in a proceeding
for the appointment of a successor Collateral Agent, and all fees,
including, but not limited to, extraordinary fees associated with
the filing of interpleader and expenses associated therewith, shall
be payable by the Pledgors on demand.
Rights with respect to Pledged Securities. Each Holder agrees with all other Holders and
the Collateral Agent (i) that it shall not, and shall not attempt
to, exercise any rights with respect to its security interest in
the Pledged Securities, whether pursuant to any other agreement or
otherwise (other than pursuant to this Agreement), or take or
institute any action against the Collateral Agent or any of the
other Holders in respect of the Pledged Securities or its rights
hereunder (other than any such action arising from the breach of
this Agreement) and (ii) that such Holder has no other rights with
respect to the Pledged Securities other than as set forth in this
Agreement and any other documents. Upon the acceptance of any
appointment as Collateral Agent hereunder by a successor Collateral
Agent, such successor Collateral Agent shall thereupon succeed to
and become vested with all the rights, powers, privileges and
duties of the retiring Collateral Agent and the retiring Collateral
Agent shall be discharged from its duties and obligations under the
Agreement. After any retiring Collateral Agent’s resignation
or removal hereunder as Collateral Agent, the provisions of the
Agreement including this Annex C shall inure to its benefit as to
any actions taken or omitted to be taken by it while it was
Collateral Agent.