On
May 12, 2020, Jaguar Health, Inc. (the “Company”) and Napo Pharmaceuticals, Inc. (“Napo”), a wholly-owned
subsidiary of the Company, entered into an accounts receivable purchase agreement (the “Purchase Agreement”) with Oasis
Capital, LLC (“Purchaser”), pursuant to which Purchaser may from time to time in its discretion purchase accounts receivable
of the Company or Napo on a recourse basis at a purchase price equal to 37.5% of the face amount of each of the purchased accounts
(“Purchase Price”). With respect to a purchased account, in the event Purchaser receives more than an amount equal
to the sum of (i) the face amount of such purchased account multiplied by 0.0545 and (ii) the Purchase Price (such amount, the
“Threshold Price”) from collection on such purchased account, then Purchaser will return any such excess overage amount
(the “Overage”) to Company or Napo, as applicable, within five days after Purchaser’s receipt thereof. The
Company and Napo will service and administer the purchased accounts receivable for Purchaser.
In the event Purchaser does not receive
at least the Threshold Price for a purchased account on or before such account becomes due and payable, Company and Napo will,
at Purchaser’s election, be obligated to either (i) pay the difference between the Threshold Price and the amount received
by Purchaser for such account (the “Shortfall”) within 30 days thereof, (ii) assign or transfer to Purchaser additional
accounts receivable with a Purchase Price equal to (A) the Shortfall plus (B) an amount equal to 25% of the Shortfall (the “Additional
Amount”).
Under the terms of the Purchase Agreement,
Purchaser initially agreed to purchase certain accounts receivable with a face amount of $2,753,639 from Napo for a Purchase Price
of $1,032,000 and a Threshold Price of $1,182,000, which purchase was effectuated pursuant to an assignment agreement, dated May
12, 2020, between Napo and Purchaser (the “Assignment Agreement”).
The initial term of the Purchase Agreement
is one year, which will automatically renew for successive one-year periods unless notice of non-renewal is provided by the Company
at least 30 days prior to the expiration of a term. Notwithstanding the foregoing, either Purchaser or the Company may terminate
the Purchase Agreement on 60 days’ prior written notice. Under the Purchase Agreement, Purchaser is entitled to a transaction
fee of $25,000 and may be entitled to additional transaction fees to the extent Purchaser acquires additional accounts receivable
under the Purchase Agreement, which fees will not exceed $5,000 per transaction.
Pursuant
to the Purchase Agreement, the prior written consent of Purchaser is required for (i) any material change in the beneficial ownership
of the Company or Napo resulting in a change of control thereof and (ii) any sale, lease, transfer or other disposition of all
or substantially all of the Company or Napo’s property or assets or the consolidation or merger of the Company or Napo with
any corporation or other entity. Purchaser also has a right of first offer with respect to any sale, financing
or factoring arrangement involving the accounts of the Company or Napo. The Company and Napo have also agreed to indemnify Purchaser
for certain losses incurred by Purchaser by reason of the Purchase Agreement or pertaining to any purchased accounts receivable.
The foregoing descriptions of the Purchase
Agreement and the Assignment Agreement are not complete and are qualified in their entirety by reference to the full text of the
Purchase Agreement and the Assignment Agreement, respectively, which are filed as Exhibits 10.1 and 10.2, respectively, to this
report and are incorporated by reference herein.
On May 13, 2020, the Company issued a press release announcing
the effectuation of the transactions contemplated under the Purchase Agreement and the Assignment Agreement. A copy of the
press release is furnished as Exhibit 99.1 of this report.