SEC Filings

PERNIX THERAPEUTICS HOLDINGS, INC. filed this Form 8-K on 02/27/2019
Entire Document

outstanding; (e) arising with respect to customary indemnification obligations in favor of purchasers in connection with dispositions of personal property assets that are Permitted Dispositions; (f) existing or arising under any Hedge Contract, so long as there exists no Event of Default both immediately before and immediately after giving effect to any such transaction, and provided, that such obligations are (or were) entered into by a Loan Party in the Ordinary Course of Business for the purpose of mitigating risks associated with interest rates, commodity prices, currency, liabilities, commitments, investments, assets, or property held or reasonably anticipated by such Person and not for purposes of speculation; (g) that are Permitted Investments; (h) that constitute Permitted Indebtedness or are with respect to indebtedness that constitutes Permitted Indebtedness; (i) pursuant to the Zogenix Purchase Agreement as in effect on the Petition Date; and (j) not permitted by clauses (a) through (i) above, not to exceed $1,000,000 in the aggregate at any time outstanding.


Permitted Dispositions” means:


(a)       sales, abandonment, or other dispositions of Equipment that is substantially worn, damaged, or obsolete or no longer used or useful in the Ordinary Course of Business and leases or subleases of Real Property not useful in the conduct of the business of Borrower and its Subsidiaries,


(b)       sales of Inventory to buyers (including without limitation, sales of inventory to Affiliates to the extent permitted pursuant to Section ‎6.10 of the Agreement) in the Ordinary Course of Business,


(c)       the disposition of Cash Equivalents in the Ordinary Course of Business in a manner that is not prohibited by the terms of the Agreement,


(d)       the entry into Non-Exclusive Licenses; provided that the Borrower will not, and will not permit its Subsidiaries to, enter into any Non-Exclusive License unless the following conditions are met:


(i)        the relevant Loan Party receives consideration at the time of the Non-Exclusive License at least equal to fair market value (determined by Borrower, or, in the case of any Non-Exclusive License valued in excess of $2,500,000, by the Board of Directors of Borrower) of such Non-Exclusive License,


(ii)        100% of the consideration consists of cash or Cash Equivalents (it being understood that any deferred payment, milestone payment, royalty payment or other contingent payment in connection with any sale or licensing of Intellectual Property, in each case, to be paid in cash or Cash Equivalents, shall constitute cash consideration for purposes of this clause (ii)), and


(iii)        the Borrower shall comply with Section 2.4(d)(ii) of the Agreement in connection with such Non-Exclusive License,


(e)       the granting of Permitted Liens,


(f)       the sale or discount, in each case without recourse, of accounts receivable arising in the Ordinary Course of Business, but only in connection with the compromise or collection thereof,


(g)       any involuntary loss, damage or destruction of property of Borrower or any Subsidiary,


(h)       any involuntary condemnation, seizure or taking, by exercise of the power of


Schedule 1.1

Page - 22