Exhibit 10.37
[*]
indicates that a confidential portion of the text of this agreement has been
omitted.
EXECUTION
COPY
U.S.
$55,000,000
AMENDED
AND RESTATED LOAN AGREEMENT
Dated as
of May 9, 2008
between
GOLDMAN
SACHS SPECIALTY LENDING HOLDINGS, INC.
as
Lender,
XOMA
LTD.
as
Guarantor,
and
XOMA (US)
LLC
as
Borrower
TABLE
OF CONTENTS
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Page |
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| ARTICLE I CERTAIN
DEFINITIONS |
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SECTION 1.01. Definitions
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2
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SECTION 1.02. Interpretation;
Headings
|
11
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ARTICLE II COMMITMENT;
DISBURSEMENT; FEES
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SECTION 2.01. Commitment to
Lend
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11
|
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SECTION 2.02. Notice of
Borrowing
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11
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SECTION 2.03. Disbursement
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12
|
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SECTION 2.04. Commitment Not
Revolving
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12
|
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SECTION 2.06. Upfront Underwriting
Fee
|
12
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ARTICLE III
REPAYMENT
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SECTION 3.01. Amortization
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12
|
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SECTION 3.02. Optional Prepayment; Prepayment
Premium
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13
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SECTION 3.03. Illegality
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13
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ARTICLE IV INTEREST;
EXPENSES
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SECTION 4.01. Interest Rate
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13
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SECTION 4.02. Payment
Account
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14
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SECTION 4.03. Interest Reserve
Account
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14
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SECTION 4.04. Interest on Late
Payments
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14
|
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SECTION 4.05. Initial
Expenses
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14
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SECTION 4.06. Administration and Enforcement
Expenses
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14
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ARTICLE V
TAXES
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SECTION 5.01. Taxes
|
15
|
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SECTION 5.02. Receipt of
Payment
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16
|
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SECTION 5.03. Other Taxes
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16
|
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SECTION 5.04.
Indemnification
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16
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ARTICLE VI PAYMENTS;
COMPUTATIONS
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SECTION 6.01. Making of
Payments
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16
|
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SECTION 6.02. Computations
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16
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SECTION 6.03. Setoff or
Counterclaim
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17
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ARTICLE VII CONDITIONS
PRECEDENT
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SECTION 7.01. Conditions Precedent to the
Loan
|
17
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ARTICLE VIII REPRESENTATIONS
AND WARRANTIES
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SECTION 8.01. Representations and Warranties of
the Borrower
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19
|
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SECTION 8.02. Survival of Representations and
Warranties
|
24
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ARTICLE IX AFFIRMATIVE
COVENANTS
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SECTION 9.01. Maintenance of
Existence
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24
|
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SECTION 9.02. Maintenance of Single Owner and
Status as Disregarded Entity for Tax Purposes
|
24
|
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SECTION 9.03. Treatment of U.S. Domestic Source
Income
|
24
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SECTION 9.04. Use of
Proceeds
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25
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SECTION 9.05. Financial Statements and
Information
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25
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SECTION 9.06. Books and
Records
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26
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SECTION 9.07. Inspection Rights;
Access
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26
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SECTION 9.08. Payment
Account
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26
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SECTION 9.09. Maintenance of Insurance and
Properties
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26
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SECTION 9.10. Governmental
Authorizations
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26
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SECTION 9.11. Compliance with Laws and
Contracts
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26
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SECTION 9.12. Plan Assets
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27
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SECTION 9.13. Notices
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27
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SECTION 9.14. Payment of
Taxes
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27
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SECTION 9.15. Waiver of Stay, Extension or Usury
Laws
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27
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SECTION 9.16. Further
Assurances
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27
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ARTICLE X NEGATIVE
COVENANTS
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SECTION 10.01. Activities of the
Borrower
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28
|
|
SECTION 10.02. Merger; Sale of
Assets
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28
|
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SECTION 10.03. Liens
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29
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SECTION 10.04. No
Subsidiaries
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30
|
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SECTION 10.05. Investment Company
Act
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30
|
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SECTION 10.06. Limitation on Additional
Indebtedness
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30
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SECTION 10.07. Limitation on Transactions with
Affiliates
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30
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SECTION 10.08. Interest Coverage
Ratio
|
31
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SECTION 10.09. ERISA
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31
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ARTICLE XI EVENTS OF
DEFAULT
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SECTION 11.01. Events of
Default
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31
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SECTION 11.02. Default
Remedies
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33
|
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SECTION 11.03. Right of
Set-off
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34
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SECTION 11.04. Rights Not
Exclusive
|
34
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ARTICLE XII
GUARANTEE
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SECTION 12.01. Guarantee
|
34
|
|
SECTION 12.02. Guarantee
Absolute
|
34
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SECTION 12.03. Waivers and
Acknowledgments
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35
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SECTION 12.04. Subrogation
|
36
|
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SECTION 12.05. Continuing
Guarantee
|
36
|
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SECTION 12.06. Representations and Warranties of
XOMA
|
37
|
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SECTION 12.07. Covenants of
XOMA
|
37
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ARTICLE XIII
INDEMNIFICATION
|
SECTION 13.01. Funding
Losses
|
38
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SECTION 13.02. Increased
Costs
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38
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SECTION 13.03. Other Losses
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38
|
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SECTION 13.04. Assumption of Defense;
Settlements
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39
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ARTICLE XIV
MISCELLANEOUS
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SECTION 14.01. Assignments
|
39
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SECTION 14.02.
Participations
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40
|
|
SECTION 14.03. Successors and
Assigns
|
41
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|
SECTION 14.04. Notices
|
41
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SECTION 14.05. Entire
Agreement
|
42
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SECTION 14.06. Modification
|
42
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|
SECTION 14.07. No Delay; Waivers;
etc
|
43
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SECTION 14.08. Severability
|
43
|
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SECTION 14.09.
Determinations
|
43
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SECTION 14.10. Replacement of
Note
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43
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SECTION 14.11. Governing
Law
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43
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SECTION 14.12. Jurisdiction
|
43
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SECTION 14.13. Waiver of Jury
Trial
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44
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SECTION 14.14. Waiver of
Immunity
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44
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SECTION 14.15. Counterparts
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44
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SECTION 14.16. Limitation on Rights of
Others
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44
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SECTION 14.17. No
Partnership
|
44
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SECTION 14.18. Survival
|
44
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SECTION 14.19. Patriot Act
Notification
|
44
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Exhibit
A.
|
Form
of Promissory Note
|
|
Exhibit
B.
|
Form
of Notice of Borrowing
|
|
Exhibit
C.
|
Form
of Security Agreement Amendment
|
|
Exhibit
D-1.
|
Form
of Certificate of the Borrower
|
|
Exhibit
D-2.
|
Form
of Certificate of XOMA
|
|
Exhibit
E.
|
Existing
Liens and Related Indebtedness
|
|
Exhibit
F.
|
Revenue
Milestones
|
|
Exhibit
G.
|
Form
of Assignment and Acceptance
|
|
Exhibit
H-1.
|
[*]
|
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Exhibit
H-2.
|
[*]
|
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Exhibit
I.
|
XOMA
Bermuda Representation Letter
|
|
Exhibit
J.
|
XOMA
BCE/HE Intellectual Property
|
|
Exhibit
K.
|
Existing
Collaboration or Development Agreements and Related
Indebtedness
|
This
AMENDED AND RESTATED LOAN AGREEMENT dated as of May 9, 2008, by
and between Goldman Sachs Specialty Lending Holdings, Inc., a
Delaware corporation (the “Lender”), as Lender,
XOMA (US) LLC, a Delaware limited liability company (the “Borrower”), as
Borrower, and XOMA Ltd., a Bermuda company (“XOMA”), as guarantor,
amends and restates in its entirety the Loan Agreement by and between the
Lender, the Borrower and XOMA dated as of November 9, 2006 (the “Original Loan
Agreement”). This Agreement is effective and supersedes the
Original Loan Agreement as of the date hereof. The Lender, the
Borrower and XOMA are hereinafter referred to collectively as the “Parties” or
individually as a “Party”.
W I T N E S S E T
H:
WHEREAS,
the Borrower is a Delaware limited liability company that was formed on
May 31, 1999 and having its principal place of business at 2910 Seventh
Street, Berkeley, California 94710;
WHEREAS,
the Payment Rights (as defined below) were assigned to the Borrower by XOMA
(Bermuda) Ltd. (“XOMA
Bermuda”) pursuant to the Acquisition Agreement, dated November 9, 2006
(the “Acquisition
Agreement”);
WHEREAS,
the Borrower entered into the Second Amended and Restated Collaboration
Agreement (the “Collaboration
Agreement”), effective as of January 1, 2005, with Genentech, Inc., a
Delaware corporation, with respect to certain payment rights in relation to
RAPTIVA® (the
“Raptiva
Rights”);
WHEREAS,
the Parties desire to amend and restate the Original Loan Agreement to modify,
inter alia, the amount
of the Commitment thereunder;
WHEREAS,
in order to induce the Lender to enter into the Original Loan Agreement and to
extend credit thereunder, the Borrower granted the Lender a security interest in
the Payment Rights and all of the Borrower’s rights under the Acquisition
Agreement and the Raptiva Rights as collateral for the Borrower’s obligations
thereunder;
WHEREAS,
the Parties intend that (a) the Obligations under and as defined in the Original
Loan Agreement that remain unpaid and outstanding as of the Closing Date shall
continue to exist under this Agreement on the terms set forth herein, (b) the
amount constituting a Loan under and as defined in the Original Loan Agreement
outstanding as of the date hereof shall constitute a Loan under and as defined
in this Agreement on the terms set forth herein, and (c) the Collateral and the
Loan Documents (as amended pursuant hereto) shall continue to secure, guarantee,
support and otherwise benefit the Obligations under and as defined in the
Original Loan Agreement as well as the Obligations under and as defined in this
Agreement (including, without limitation, Obligations in respect of the Loan and
the Commitment) and the other Loan Documents;
WHEREAS,
the execution of this Agreement by the Lender is conditioned upon the Borrower’s
entering into an amendment to the Security Agreement; and
WHEREAS,
XOMA has agreed to guarantee the Borrower’s obligations hereunder;
NOW,
THEREFORE, in consideration of the mutual promises of the Parties, and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, it is mutually agreed by the Parties as follows:
ARTICLE
I
CERTAIN
DEFINITIONS
SECTION
1.01. Definitions. As
used herein:
“Account Bank” means
The Northern Trust Company.
“Acquisition
Agreement” has the meaning specified in the second recital
hereof.
“Act of Insolvency”
shall mean, with respect to any Person, such Person shall generally not pay its
debts as such debts become due, or shall admit in writing its inability to pay
its debts generally, or shall make a general assignment for the benefit of
creditors (or the equivalent); or any proceeding shall be instituted by or
against such Person seeking to adjudicate it a bankrupt or insolvent (or the
equivalent), or seeking liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief, moratorium or composition of it or its debts
under any law relating to bankruptcy, insolvency or reorganization or relief of
debtors or the like, or seeking the entry of an order for relief or the
appointment of a receiver, trustee, or other similar official for it or for any
substantial part of its property, or such Person shall take any corporate action
to authorize any of the actions set forth above in this definition.
“Affiliate” with
respect to any Person means any Person directly or indirectly controlling,
controlled by or under common control with, such Person. For the
purposes of this Agreement, “control” (including,
with correlative meaning, the terms “controlling” and
“controlled”)
shall mean the possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of such Person, whether
through the ownership of voting securities, by contract or
otherwise.
“Agreement” means this
Amended and Restated Loan Agreement.
“Assignee” has the
meaning specified in Section 14.01(b).
“Assignment and
Acceptance” has the meaning specified in Section 14.01(c).
“Banking Day” means
any day, except a Saturday, Sunday or other day on which commercial banks in New
York are required or authorized by law to close, which is also a day on which
commercial banks are open for international business (including dealing in
Dollar deposits) in London.
“BCE Program” has the
meaning specified in Section 8.01(gg).
“Borrower” has the
meaning specified in the first paragraph hereof.
“Borrower Change of
Control” means any change of control of the Borrower that results in the
Borrower not being directly controlled by XOMA.
“Borrower Documents”
means the Borrower’s Limited Liability Company Agreement, dated May 31, 1999,
and the certificate of formation of the Borrower.
“Capital Stock” of any
Person means any and all shares, interests, ownership interest units, rights to
purchase, warrants, options, participations or other equivalents of or interests
in (however designated) equity of such Person, including any preferred stock,
but excluding any debt securities convertible into such equity.
“Chiron Loan” has the
meaning specified in Section 8.01(m).
“CIMZIA License
Agreement” has the meaning specified in the definition of “License
Agreements”.
“Closing Date” means
the date upon which the conditions precedent under Article VII have been
satisfied to the satisfaction of the Lender.
“Code” means the
Internal Revenue Code of 1986 and applicable U.S. Department of Treasury
regulations issued pursuant thereto in temporary or final form.
“Collaboration
Agreement” has the meaning specified in the third recital
hereof.
“Collateral” has the
meaning given it in the Security Agreement.
“Collaboration Intellectual
Property” means any intellectual property jointly made or jointly owned
by a XOMA Party and a third-party collaboration partner in the course of
conducting research and development activities pursuant to a collaboration
agreement.
“Commitment” means
$55,000,000.
“Contract” has the
meaning specified in Section 8.01(e).
“Default” means any
condition or event which constitutes an Event of Default or which, with the
giving of notice or the lapse of time or both would, unless cured or waived,
become an Event of Default.
“Default Rate” means,
for any period for which an amount is overdue, a rate per annum equal for each
day in such period to the sum of (i) the applicable Margin, (ii) 3.00% and (iii)
the greater of 3.00% and LIBOR determined by the Lender for such period as the
Lender determines to be reasonable in the circumstances.
“Designated Excess”
has the meaning specified in Section 3.01(a).
“Dispute” means any
dispute, deduction, claim, offset, defense or counterclaim of any kind between
XOMA Bermuda or the Borrower on the one hand and any Obligor (or any of its
Affiliates) on the other hand relating to any Payment Right, Raptiva Right or
any License
Agreement,
as applicable; provided, however, that “Dispute” shall
not mean (a) any such dispute, deduction, claim, offset, defense or counterclaim
(i) [*], (ii) that is not reasonably expected to have an adverse effect on
either the Raptiva Rights or the Payments Rights or (iii) where the amount in
dispute does not exceed $100,000; or (b) an Act of Insolvency on the part of any
Obligor or any Affiliate of any Obligor.
“Dollars” or “$” means lawful money
of the United States of America.
“ERISA” means the
Employee Retirement Income Security Act of 1974, as amended, and the regulations
promulgated thereunder.
“ERISA Affiliate” at
any time means each trade or business (whether or not incorporated) that would,
at any time, be treated, together with XOMA, the Borrower or any of their
respective Subsidiaries, as a single employer under Title IV or Section 302 of
ERISA or Section 412 of the Code or any similar provision under non-U.S.
law.
“Event of Default” has
the meaning specified in Section 11.01.
“Exchange Act” means
the Securities Exchange Act of 1934 and the regulations promulgated
thereunder.
“Excluded Taxes” means
(i) any Taxes imposed on (or measured by) net income (including branch profits
Taxes) of the Lender, or any franchise or similar Taxes imposed in lieu thereof,
by any Governmental Authority or taxing authority by the jurisdiction under the
laws of which the Lender is organized or any jurisdiction in which the Lender is
a resident, has an office, conducts business or has another connection (other
than a business or connection resulting from the Lender being a party to,
performing its obligations or receiving payments under, or enforcing, this
Agreement, or otherwise arising out of the transactions contemplated by this
Agreement) and (ii) in the case of a Foreign Lender, any withholding tax that is
imposed on amounts payable to such Foreign Lender (a) under law in effect at the
time such Foreign Lender becomes a party to this Agreement (or designates a new
Lending Office), except to the extent that such Foreign Lender (or its assignor,
if any) was entitled, at the time of designation of a new Lending Office (or
assignment), to receive additional amounts from the Borrower with respect to
such withholding tax pursuant to Section 5.01(a) or (b) that is attributable to
such Foreign Lender’s failure to comply with Section 5.01(b).
“Existing Disputes”
has the meaning specified in the definition of “Dispute”.
“Foreign Lender” has
the meaning specified in Section 5.01(b).
“GAAP” means the
generally accepted accounting principles in the United States of America in
effect from time to time.
“Genentech” means
Genentech, Inc., a Delaware corporation.
[*]
“Governmental
Authority” means any nation or government, any state or other political
subdivision thereof, and any entity exercising executive, legislative, judicial,
regulatory or administrative functions of, or pertaining to,
government.
“Guaranteed
Obligations” has the meaning specified in Section 12.01.
“Indebtedness” with
respect to any Person means any amount (absolute or contingent) payable by such
Person as debtor, borrower, issuer, guarantor or otherwise (i) pursuant to
an agreement or instrument involving or evidencing money borrowed, the advance
of credit, a conditional sale or a transfer with recourse or with an obligation
to repurchase, (ii) pursuant to a lease with substantially the same
economic effect as any such agreement or instrument, (iii) pursuant to any
equity interest with a mandatory obligation to repurchase, (iv) pursuant to
indebtedness of a third party secured by (or for which the holder of such
indebtedness has an existing right, contingent or otherwise, to be secured by)
any Lien on assets owned or acquired by such Person, whether or not the
indebtedness secured thereby has been assumed, (v) pursuant to an interest
rate protection agreement, foreign currency exchange agreement or other hedging
arrangement or (vi) pursuant to a letter of credit issued for the account
of such Person. For the avoidance of doubt, the Indebtedness of any
Person shall include the Indebtedness of any other entity to the extent such
Person is directly liable therefor as a result of such Person’s ownership
interest in or other relationship with such entity, except to the extent the
terms of such Indebtedness provide that such Person is not liable
therefor.
“Indemnified
Liabilities” means, collectively, any and all liabilities, obligations,
losses, damages, penalties, claims, costs, expenses and disbursements of any
kind or nature whatsoever (including the reasonable fees and disbursements of
counsel for Indemnitees in connection with any investigative, administrative or
judicial proceeding commenced or threatened by any Person, whether or not any
such Indemnitee shall be designated as a party or a potential party thereto, and
any fees or expenses incurred by Indemnitees in enforcing the indemnity provided
herein), whether direct, indirect or consequential and whether based on any
federal, state or foreign laws, statutes, rules or regulations (including
securities and commercial laws, statutes, rules or regulations), on common law
or equitable cause or on contract or otherwise, that may be imposed on, incurred
by, or asserted against any such Indemnitee, in any manner relating to or
arising out of this Agreement or the other Loan Documents or the transactions
contemplated hereby or thereby (including any enforcement of any of the Loan
Documents (including any sale of, collection from, or other realization upon any
of the Collateral (as defined in the Security Agreement)).
“Indemnified Taxes”
has the meaning specified in Section 5.01.
“Indemnitee” has the
meaning specified in Section 13.03.
“Interest Coverage
Ratio” means, with respect to any Interest Payment Date, the ratio of (i)
all payments received (net of any withholding taxes) with respect to the Payment
Rights and the Raptiva Rights during the two fiscal quarters immediately
preceding such Interest Payment Date to (ii) the amount of interest due and
payable on the Loan on such Interest Payment Date.
“Interest Payment
Date” means the last day of each Interest Period.
“Interest Period”
means the period beginning on the Closing Date (in the case of the initial
Interest Period) or on the last day of the next preceding Interest Period (in
the case of any subsequent Interest Period) and ending on the day numerically
corresponding to the first day of that Interest Period in the sixth month
thereafter; provided, that the
initial Interest Period shall end on October 1, 2008 and any Interest Period
which would otherwise end after the Maturity Date shall end on the Maturity
Date.
“Interest Rate” means
with respect to any day during any Interest Period the sum of (i) the Margin and
(ii) the greater of 3.00% and LIBOR for such day.
“Interest Reserve
Account” means the interest reserve account, which may be a sub-account
of the Payment Account, established in the name of the Lender and for the
benefit, and under the control, of the Lender with account no. 1885042193
maintained with the Account Bank or such other interest reserve account as the
Borrower and Lender may agree to in writing.
“Law” means any
federal, state, local or foreign law, including common law, and any regulation,
rule, requirement, policy, judgment, order, writ, decree, ruling, award,
approval, authorization, consent, license, waiver, variance, guideline or permit
of, or any agreement with, any Governmental Authority.
“Lender” means the
Lender (as defined in the first paragraph hereof) and any assignee under Section
14.01(b).
“Lending Office”
means, with respect to the Lender, its New York office, and with respect to any
other Lender, the office of such Lender designated as its “Lending Office” in an
Assignment and Acceptance, or such other office as may be otherwise designated
in writing from time to time by such Lender to the Borrower.
“Letter of Credit” has
the meaning specified in Section 8.01(m).
“LIBOR” with respect
to any Interest Period (or other period determined by the Lender with respect to
any overdue amount) means the per annum rate for deposits in Dollars for a term
coextensive with such Interest Period (or other period) which appears on Reuters
Screen LIBOR01 Page as of 11:00 a.m., London time, on the day that is two
Banking Days preceding the first day of such Interest Period (or other
period). (For purposes of the preceding sentence, LIBOR for any
Interest Period (or other period) of a length for which rates do not appear on
Reuters Screen LIBOR01 Page shall be determined through the use of straight line
interpolation by reference to two LIBOR rates appearing on Reuters Screen
LIBOR01 Page, one of which shall be the rate for the period of time next shorter
than the length of the Interest Period (or other period) and the other of which
shall be the rate for the period of time next longer than the length of the
Interest Period (or other period).) If no such rate appears on
Reuters Screen LIBOR01 Page, LIBOR shall mean the per annum rate, determined on
the basis of the rates at which deposits in Dollars for a term coextensive with
such Interest Period (or other period) and in an amount approximately equal to
the principal amount of the Loan or overdue amount are offered by four major
banks in the London interbank market, selected by the Lender, at approximately
11:00 a.m., London time, on the day that is two Banking Days preceding the first
day of such Interest
Period
(or other period). If at least two such quotations are provided,
LIBOR for such Interest Period (or other period) shall be the arithmetic mean of
the quotations. If fewer than two quotations are provided as
requested, LIBOR for such Interest Period (or other period) shall be the
arithmetic mean of the per annum rates quoted by major banks in New York City,
selected by the Lender, at approximately 11:00 a.m., New York City time, on such
day for loans in Dollars to leading European banks for a term coextensive with
such Interest Period (or other period) and in an amount approximately equal to
the principal amount of the Loan or overdue amount.
“License Agreements”
means:
(i) the
Collaboration Agreement;
(ii) the
Non-Exclusive Genentech License Agreement, effective as of December 30, 1998,
between XOMA Bermuda (as successor in interest to XOMA Corporation) and
Genentech, Inc. (the “LUCENTIS License
Agreement); and
(iii) the
Non-Exclusive License Agreement, effective as of December 23, 1998, between XOMA
Bermuda (as successor in interest to XOMA Corporation) and UCB (as successor in
interest to Celltech Therapeutics Ltd.) (the “CIMZIA License
Agreement”).
“Lien” means any
mortgage or deed of trust, pledge, hypothecation, lien, charge, attachment,
set-off, encumbrance or other security interest in the nature thereof (including
any conditional sale agreement, equipment trust agreement or other title
retention agreement, a lease with substantially the same economic effect as any
such agreement or a transfer or other restriction) or other encumbrance of any
nature whatsoever.
“Loan” at any time
means the aggregate principal amount advanced to the Borrower hereunder then
outstanding.
“Loan Documents” means
this Agreement, the Note and the Security Agreement.
“LUCENTIS License
Agreement” has the meaning specified in the definition of “License
Agreements”.
“Margin” means, with
respect to any day during an Interest Period, 8.50%.
“Material Adverse
Effect” means (i) a material adverse effect on the business, results
of operations, assets or financial condition of the Borrower, (ii) a reduction
or other impairment of the value of the Payment Rights, the Raptiva Rights, the
Payment Rights-Related Intellectual Property, the Raptiva Rights-Related
Intellectual Property or the XOMA US Intellectual Property or (iii) an
impairment of the ability of the Borrower to perform its obligations under, or
affect the validity or enforceability of, any Transaction Document to which it
is party.
“Maturity Date” means
the earlier of (i) the fifth anniversary of the Closing Date and (ii) the date
of any prepayment in full of the Loan.
“Note” means a
promissory note, substantially in the form set forth in Exhibit A, in the
amount of the Loan, evidencing such Loan.
“Notice of Borrowing”
has the meaning specified in Section 2.02.
“Notices” has the
meaning specified in Section 14.04.
“Obligations” means,
without duplication, the Loan and all present and future Indebtedness, taxes,
liabilities, obligations, covenants, duties, and debts, owing by the Borrower to
the Lender, arising under or pursuant to the Loan Documents, including all
principal, interest, charges, expenses, fees and any other sums chargeable to
the Borrower hereunder and under the other Loan Documents (and including any
interest, fees and other charges that would accrue but for the filing of a
bankruptcy action with respect to the Borrower, whether or not such claim is
allowed in such bankruptcy action).
“Obligors” means,
together, Genentech and UCB.
“Original Loan
Agreement” has the meaning specified in the first paragraph
hereof.
“Participant” has the
meaning specified in Section 14.02.
“Party” and “Parties” have the
meanings specified in the first paragraph hereof.
“Payment Account”
means the lock-box account established in the name of the Lender and for the
benefit, and under the control, of the Lender with account no. 1885042193
maintained with the Account Bank or such other account as the Borrower and
Lender may agree to in writing.
“Payment Rights” has
the meaning specified in the Acquisition Agreement as in effect on the Closing
Date.
“Payment Rights-Related
Intellectual Property” means all intangible legal rights owned or
controlled by XOMA Bermuda in relation to the Payment Rights pursuant to the
License Agreements, whether or not filed, perfected, registered or recorded and
whether now or hereafter existing, filed, issued or acquired and any rights in
or to any applications for any of the foregoing.
“Permitted Convertible
Securities” means debt securities that (i) are by their terms
convertible, without the payment of additional consideration, into common shares
of XOMA; (ii) are not required to be repaid prior to the date that is five years
and ninety-five days following the Closing Date; and (iii) have an effective
conversion premium (within the meaning of Rule 144A under the Securities Act of
1933) at issuance of not greater than 30%.
“Permitted Liens” has
the meaning specified in Section 10.03.
“Person” means an
individual, corporation, association, limited liability company, limited
liability partnership, partnership, estate, trust, unincorporated organization
or a government or any agency or political subdivision thereof.
“Plan” has the meaning
specified in Section 10.09(a).
“Plan Assets” means
assets of any (i) employee benefit plan (as defined in Section 3(3) of ERISA)
subject to Title I of ERISA, (ii) plan (as defined in Section 4975(e)(1) of
the Code) subject to Section 4975 of the Code or (iii) entity whose underlying
assets include assets of any such employee benefit plan or plan by reason of the
investment by an employee benefit plan or other plan in such
entity.
“Prepayment Premium”
with respect to any prepayment of principal of the Loan made on any day means an
amount equal to (i) [*]% of the amount of the Loan to be prepaid, if such
prepayment occurs prior to the first anniversary of the Closing Date; (ii) [*]%
of the amount of the Loan to be prepaid, if such prepayment occurs on or after
the first anniversary of the Closing Date but prior to the second anniversary of
the Closing Date; (iii) [*]% of the amount of the Loan to be repaid, if such
prepayment occurs on or after the second anniversary of the Closing Date but
prior to the third anniversary of the Closing Date; (iv) [*]% of the amount of
the Loan to be repaid, if such prepayment occurs on or after the third
anniversary but prior to the fourth anniversary of the Closing Date; (v) zero,
if such payment occurs on or after the fourth anniversary of the Closing
Date.
“Proceeding” has the
meaning specified in Section 14.12.
“Raptiva Rights” has
the meaning specified in the third recital hereof.
“Raptiva Rights-Related
Intellectual Property” means all intangible legal rights owned or
controlled by the Borrower in relation to the Raptiva Rights and the
Collaboration Agreement, whether or not filed, perfected, registered or recorded
and whether now or hereafter existing, filed, issued or acquired and any rights
in or to any applications for any of the foregoing.
“Required Consents”
means, [*].
“Required Lenders”
means, at any time, Lenders that in the aggregate hold more than 50% of the
outstanding principal amount of the Loan.
“Reuter Screen LIBOR01
Page” means the display page so designated on Reuters reporting service
(or such other page as may replace that page on that service, or such other
service as may be designated by the Lender as the information vendor for the
purpose of displaying rates comparable to LIBOR).
“Security Agreement”
means the Security Agreement, dated November 9, 2006, between the Lender
and the Borrower, as amended as of the date hereof, securing the Obligations of
the Borrower hereunder.
“Subsidiary” means,
with respect to any Person, at any time, any entity of which more than fifty
percent (50%) of the outstanding voting stock or other equity interest entitled
ordinarily to vote in the election of the directors or other governing body
(however designated) is at the time beneficially owned or controlled directly or
indirectly by such Person, by one or more such entities or by such Person and
one or more such entities.
“Subsidiary Guarantee”
has the meaning specified in Section 12.07(b).
“Taxes” has the
meaning specified in Section 5.01.
“Third Party Intellectual
Property Rights” shall mean any intellectual property owned by a third
party.
“Transaction
Documents” means the Loan Documents, the Acquisition Agreement, the XOMA
Bermuda Representation Letter, the License Agreements, the Required Consents and
the Borrower Documents.
[*].
“UCB” means UCB
Celltech, a branch of UCB S.A., a Belgian company, registered in the United
Kingdom.
“U.S.” means the
United States of America.
“Voting Stock” means
Capital Stock issued by a company, or equivalent interests in any other Person,
the holders of which are ordinarily, in the absence of contingencies, entitled
to vote for the election of directors (or persons performing similar functions)
of such Person, even if the right so to vote has been suspended by the happening
of such contingency.
“XOMA” means has the
meaning set forth in the first paragraph hereof.
“XOMA BCE/HE Intellectual
Property” means the patents and patent applications listed in Exhibit
J.
“XOMA Bermuda” has the
meaning set forth in the second recital hereof.
“XOMA Bermuda Change of
Control” means any change of control of XOMA Bermuda that results in XOMA
Bermuda not being directly controlled by XOMA.
“XOMA Bermuda Representation
Letter” has the meaning set forth in Section 7.01(e).
“XOMA Change of
Control” means that (i) any Person or two or more Persons acting in
concert shall have acquired beneficial ownership (within the meaning of Rule
13d-3 of the Securities and Exchange Commission under the Exchange Act),
directly or indirectly, of Voting Stock of XOMA (or other securities convertible
into such Voting Stock) representing 30% or more of the combined voting power of
all Voting Stock of XOMA; or (ii) during any period of up to 24 consecutive
months, commencing after the Closing Date, individuals who at the
begin-
ning of
such period were directors of XOMA shall cease for any reason to constitute a
majority of the board of directors of XOMA unless the election or nomination for
election by XOMA’s shareholders of each new director was approved by the vote of
at least two-thirds of the directors then still in office who were directors at
the beginning of such period.
“XOMA Ireland” has the
meaning specified in Section 8.01(gg).
“XOMA Party” means
each of XOMA, XOMA Bermuda and the Borrower.
“XOMA US Intellectual
Property” means all of the following worldwide intangible legal rights
owned or controlled by the Borrower (other than with respect to Raptiva® brand
anti-CD11a), whether or not filed, perfected, registered or recorded and whether
now or hereafter existing, filed, issued or acquired: (i) patents,
patent disclosures, patent rights, including any and all continuations,
continuations-in-part, divisionals, reissues, reexaminations, utility, model and
design patents or any extensions of these items; (ii) trademarks, service marks,
trade names and copyrights; (iii) trade secrets and rights in know-how; and (iv)
any rights in or to any applications for any of the foregoing.
SECTION
1.02. Interpretation;
Headings. Each
term used in any Exhibit to this Agreement and defined in this Agreement but not
defined therein shall have the meaning set forth in this
Agreement. Unless the context otherwise requires,
(a) “including” means “including, without limitation” and (b) words in
the singular include the plural and words in the plural include the
singular. A reference to any party to this Agreement, any other
Transaction Document or any other agreement or document shall include such
party’s successors and permitted assigns. Unless otherwise expressly
provided herein, a reference to any agreement or order shall include any
amendment of such agreement or order from time to time in accordance with the
terms herewith and therewith. A reference to any legislation, to any
provision of any legislation or to any regulation issued thereunder shall
include any amendment thereto, any modification or re-enactment thereof,
any legislative provision or regulation substituted therefore and all
regulations and statutory instruments issued thereunder or pursuant
thereto. The headings contained in this Agreement are for convenience
and reference only and do not form a part of this Agreement. Section,
Article and Exhibit references in this Agreement refer to sections or articles
of, or exhibits to, this Agreement unless otherwise specified.
ARTICLE
II
COMMITMENT;
DISBURSEMENT; FEES
SECTION
2.01. Commitment to
Lend. On
the terms and subject to the conditions set forth herein, the Lender shall, on
the Closing Date, make a loan hereunder to the Borrower in a principal amount
equal to the Commitment.
SECTION
2.02. Notice of
Borrowing. Subject
to Section 2.01, the Borrower shall, on or before the Banking Day prior to the
Closing Date, give the Lender notice, substantially in the form set forth in
Exhibit B (the
“Notice of
Borrowing”) of the date the Borrower wishes to borrow hereunder and the
amount of the Commitment the Borrower wishes to borrow on such Closing
Date.
SECTION
2.03. Disbursement. Subject
to the conditions set forth herein, the Lender shall, on the Closing Date,
credit, in same day funds, an amount equal to (i) the amount specified in the
Notice of Borrowing to the account of the Borrower which the Borrower shall have
designated for such purpose in the Notice of Borrowing less (ii) the sum of the
upfront underwriting fee referred to in Section 2.05 and the initial expenses
referred to in Section 4.05 for which invoices have been received by the
Borrower less (iii) the initial deposit in to the Interest Reserve Account
pursuant to Section 4.03(a) less (iv) all amounts, including principal and
interest, owing or accrued under the Original Loan Agreement; provided, however, that no
Prepayment Premium (under and as defined in the Original Loan Agreement) shall
be due in connection with the repayment of the loan under the Original Loan
Agreement on the Closing Date.
SECTION
2.04. Commitment Not
Revolving
SECTION
2.05. . The
Lender’s commitment to lend hereunder is not revolving in nature, and any amount
of the Loan repaid or prepaid may not be reborrowed.
SECTION
2.06. Upfront Underwriting
Fee. The
Borrower shall pay the Lender an upfront underwriting fee equal to [*]% of the
Commitment. This fee shall be payable on the Closing Date as provided
in Section 2.03.
ARTICLE
III
REPAYMENT
SECTION
3.01. Amortization.
(a) On each
Interest Payment Date, any cash received or held in the Payment Account in
excess of (i) the interest payable on such Interest Payment Date pursuant to
Section 4.01 and (ii) the amount to be transferred into the Interest Reserve
Account on such Interest Payment Date pursuant to Section 4.03 shall be applied
by the Lender to pay down the outstanding principal amount of the Loan at par
unless the Lender notifies the Borrower otherwise in writing. The
Lender shall have the right to specify in such notice that all or a portion of
such excess amount held in the Payment Account need not be used for the
repayment of principal (the “Designated
Excess”). Upon notice by the Borrower, the Designated Excess
shall be transferred on the related Interest Payment Date to an account of the
Borrower specified in such notice.
(b) Except as
otherwise expressly provided herein, the Borrower shall repay the outstanding
principal amount of the Loan, together with any accrued and unpaid interest
thereon, on the Maturity Date. Any amounts on deposit in the Payment
Account on the Maturity Date after full repayment of the outstanding principal
amount of, and the accrued unpaid interest on, the Loan together with all other
amounts then payable hereunder shall be transferred to an account of the
Borrower.
(c) Notwithstanding
anything to the contrary herein, if amounts on deposit in the Payment Account
and the Interest Reserve Account are insufficient to pay any amounts due under
the Loan Documents to the Lender, the Borrower shall remain fully liable for any
deficiency.
SECTION
3.02. Optional Prepayment;
Prepayment Premium.
(a) The
Borrower may, subject to Section 13.01 hereof, prepay the Loan in whole or in
part, together with accrued and unpaid interest on the amount prepaid plus, if
applicable, the Prepayment Premium plus, if the prepayment date is on any day
other than the last day of an Interest Period, any amounts payable under Section
13.01, at any time; provided, that any
prepayment in part be made in a minimum amount of $1,000,000. If the
Borrower wishes to make such a prepayment, it shall give the Lender Notice to
that effect not later than the 30th day before the date of the prepayment,
specifying the date on which the prepayment is to be made and the amount to be
prepaid. Such Notice shall constitute the Borrower’s irrevocable
commitment to prepay that amount on that date, together with interest accrued on
the amount prepaid to but excluding the prepayment date plus, if applicable, the
Prepayment Premium, plus, if the prepayment date is on any day other than the
last day of an Interest Period, any amounts payable under Section
13.01.
(b) If an
Event of Default occurs prior to the fourth anniversary of the Closing Date,
then the applicable Prepayment Premium specified for optional redemptions by the
Borrower pursuant to Section 3.02(a) shall be due and payable hereunder, to the
extent permitted by law, and shall be deemed part of the amounts due and payable
hereunder subject to acceleration (either declared or immediate as provided in
Section 11.02).
SECTION
3.03. Illegality. If
the Lender determines at any time that any Law or treaty or any change therein
or in the interpretation or application thereof makes or will make it unlawful
for the Lender to fulfill its commitment in accordance with Section 2.01,
to maintain the Loan or to claim or receive any amount payable to it hereunder,
the Lender shall give Notice of that determination to the Borrower, whereupon
the obligations of the Lender hereunder shall terminate. If any such
Notice is given after the disbursement of the Loan, the Borrower shall prepay
the Loan in full on the Interest Payment Date following the date the Notice is
given; provided, however, that, if the
Lender certifies to the Borrower that earlier prepayment is necessary in order
to enable the Lender to comply with the relevant Law, treaty or change and
specifies an earlier date for the prepayment, the Borrower shall make the
prepayment on the date so specified. Prepayment pursuant to this
Section 3.03 shall be made together with interest accrued and unpaid on the
Loan to the date of prepayment and all other amounts then payable to the Lender
hereunder. Each Notice delivered pursuant to this Section 3.03 shall
be effective when sent.
ARTICLE
IV
INTEREST;
EXPENSES
SECTION
4.01. Interest
Rate.
(a) Except as
otherwise expressly provided in Section 4.04, interest shall accrue on the
unpaid principal amount of the Loan for each day during each Interest Period,
from and including the first day of that Interest Period to but excluding the
last day thereof, at a rate per annum equal to the Interest Rate for each such
day.
(b) The
Lender shall give Notice to the Borrower of LIBOR for each Interest Period after
each determination thereof.
(c) Except as
otherwise expressly provided herein, accrued interest on the Loan shall be
payable on each Interest Payment Date.
SECTION
4.02. Payment
Account. Amounts
deposited in the Payment Account shall be available solely for (i) payment of
any interest on and the amortization of the Loan pursuant to Sections 3.01, 4.01
and 4.03, (ii) withdrawal and deposit into the Interest Reserve Account and
(iii) reimbursement to the Lender of all other costs and expenses hereunder,
including reimbursements pursuant to Sections 4.05 and 4.06.
SECTION
4.03. Interest Reserve
Account.
(a) On the
Closing Date, the Lender shall transfer pursuant to Section 2.03(iii) into
the Interest Reserve Account an amount out of the Loan proceeds equal to the
amount of interest due and payable on the Loan on the first Interest Payment
Date.
(b) Thereafter,
on each Interest Payment Date, amounts on deposit in the Payment Account shall
first be transferred into the Interest Reserve Account such that the amount on
deposit therein shall equal the amount of interest payable on the Loan on the
immediately following Interest Payment Date (calculated on the assumption that
there shall not be any intervening prepayments and after giving effect to any
amortization payment being made in accordance with Section 3.01 on the Interest
Payment Date on which such transfer occurs).
(c) Amounts
on deposit in the Interest Reserve Account shall be withdrawn solely for the
payment of interest on the Loan on any Interest Payment Date to the extent that
amounts on deposit in the Payment Account are insufficient
therefor.
SECTION
4.04. Interest on Late
Payments. If
any amount payable by the Borrower to the Lender hereunder is not paid when due
(whether at stated maturity, by acceleration or otherwise), interest shall
accrue on any such unpaid amounts, both before and after judgment, to the
fullest extent permitted by applicable Law, during the period from and including
the applicable due date, to but excluding the day the overdue amount is paid in
full, at a rate per annum equal to the Default Rate. Interest
accruing under this Section 4.04 shall be payable from time to time on demand of
the Lender.
SECTION
4.05. Initial
Expenses. The
Borrower shall reimburse the Lender, on the Closing Date as provided in
Section 2.03, for all (a) reasonable costs and expenses incurred by the
Lender (including all reasonable fees and expenses of outside counsel to the
Lender), supported by reasonable documentation, in connection with the
negotiation, preparation, execution and delivery of this Agreement and the other
Transaction Documents including any amendment or waiver with respect thereto and
(b) reasonable costs and expenses, supported by reasonable documentation, of due
diligence conducted by the Lender or other parties (including outside counsel to
the Lender) at the request of the Lender.
SECTION
4.06. Administration and
Enforcement Expenses. The
Borrower shall promptly reimburse the Lender on demand for all reasonable costs
and expenses incurred by the Lender (including the reasonable fees and expenses
of outside counsel to the Lender) as a consequence of or in connection with (i)
the negotiation, preparation or execution of any amendment to this Agreement
and/or the other Transaction Documents, (ii) the administration of the
Loan,
(iii) any
Default or Event of Default or (iv) the preservation or enforcement of any right
or remedy of the Lender under the Transaction Documents.
ARTICLE
V
TAXES
SECTION
5.01. Taxes.
(a) Except as
otherwise required by law, any and all payments by the Borrower under this
Agreement or the Note (including payments with respect to the Loan) shall be
made free and clear of and without deduction for any and all present and future
taxes, levies, duties, imposts, deductions, charges, fees or withholdings, and
all interest, penalties and other liabilities with respect thereto
(collectively, “Taxes”) imposed by
any Governmental Authority or taxing authority in any
jurisdiction. If any Taxes other than Excluded Taxes (“Indemnified Taxes”)
shall be required by Law to be deducted from or in respect of any sum payable
under this Agreement or the Note to a Lender, (i) the sum payable by the
Borrower shall be increased as may be necessary so that after making all
required deductions of Indemnified Taxes the Lender shall receive an amount
equal to the sum it would have received had no such deductions been made, (ii)
the Borrower shall make such deductions and (iii) the Borrower shall pay the
full amount deducted to the relevant Governmental Authority or taxing authority
in accordance with applicable Law.
(b) If a
Lender is not a “United States person” within the meaning of Section 7701(a)(30)
of the Code (a “Foreign Lender”),
then such Foreign Lender shall provide to the Borrower (i) in the case of a
Foreign Lender claiming exemption from U.S. federal withholding tax under
Section 871(h) or 881(c) of the Code with respect to payments of “portfolio
interest,” (x) two accurate and complete original signed copies of IRS Form
W-8BEN (or successor form) properly completed and duly executed by such Foreign
Lender and (y) a certificate to the effect that such Foreign Lender is not (A) a
“bank” within the meaning of Section 881(c)(3)(A) of the Code, (B) a “10 percent
shareholder” of the Borrower within the meaning of Section 881(c)(3)(B) of the
Code or (C) a “controlled foreign corporation” described in Section 881(c)(3)(C)
of the Code, (ii) if the payments receivable by the Foreign Lender are
effectively connected with the conduct of a trade or business in the United
States, two accurate and complete original signed copies of IRS Form W-8ECI (or
successor form), (iii) in the case of a Foreign Lender that is entitled to
benefits under an income tax treaty to which the United States is a party that
reduces the rate of withholding tax on payments of interest, two accurate and
complete original signed copies of IRS Form W-8BEN (or successor form)
indicating that such Foreign Lender is entitled to receive payments under this
Agreement and the Note with reduced or no deduction of any United States federal
income withholding tax or (iv) in the case of a Foreign Lender acting as an
intermediary, two accurate and complete original signed copies of IRS Form
W-8IMY (or successor form). Such forms shall be delivered by such
Foreign Lender on or prior to the date that it becomes a Lender under this
Agreement, at any time thereafter when a change in the Foreign Lender’s
circumstances renders an existing form obsolete or invalid or requires a new
form to be provided, and within fifteen Banking Days after a reasonable written
request of the Borrower from time to time thereafter. Notwithstanding
any other provision of this Section 5.01(b), no Foreign Lender shall be required
to deliver any form pursuant to this Section 5.01(b) that such Foreign Lender is
not legally able to deliver.
(c) Each
Lender that is not a Foreign Lender shall provide two properly completed and
duly executed copies of Form W-9 (or successor form) at the times specified for
delivery of forms under Section 5.01(b).
SECTION
5.02. Receipt of
Payment. Within
thirty days after the date of any payment of Taxes withheld by the Borrower in
respect of any payment to the Lender, the Borrower shall furnish to the Lender
the original or a certified copy of a receipt evidencing payment thereof or
other evidence reasonably satisfactory to the Lender.
SECTION
5.03. Other
Taxes. The
Borrower shall promptly pay any registration or transfer taxes, stamp duties or
similar levies, and any penalties or interest that may be due with respect
thereto, that may be imposed in connection with the execution, delivery,
registration or enforcement of this Agreement, the Note issued hereunder or any
other Transaction Document or the filing, registration, recording or perfecting
of any security interest contemplated by this Agreement.
SECTION
5.04. Indemnification. If
the Lender pays any Taxes that the Borrower is required to pay pursuant to this
Article V, the Borrower shall indemnify it on demand in full in the currency in
which such Taxes are paid, whether or not such Taxes were correctly or legally
asserted, together with interest thereon from and including the date of payment
to, but excluding, the date of reimbursement at the Default Rate; provided that if the
Borrower believes that any Taxes for which the Borrower has indemnified the
Lender were not correctly or legally asserted, the Lender will cooperate with
the Borrower (at the Borrower’s cost and expense) in pursuing a refund of such
Taxes. The Lender shall promptly notify the Borrower if any claim is
made against the Lender for any Taxes for which the Borrower would be
responsible to indemnify the Lender pursuant to this Section 5.04.
ARTICLE
VI
PAYMENTS;
COMPUTATIONS
SECTION
6.01. Making of
Payments.
(a) Each
payment required to be made by the Borrower under this Agreement or under the
Note shall be made in Dollars, by deposit in same day funds by 3:00 p.m. New
York time on the date the payment is due, to the Payment Account, for the
account of the Lending Office, or to any other account designated by the Lender
by Notice to the Borrower.
(b) Notwithstanding
anything to the contrary contained herein, any payment stated to be due
hereunder or under the Note on a given day in a specified month and any Interest
Period stated to end on a day numerically corresponding to a given day in a
specified month thereafter shall be made or shall end (as the case may be), (i)
if there is no such given day or corresponding day, on the last Banking Day of
such month or (ii) if such given day or corresponding day is not a Banking Day,
on the next succeeding Banking Day, unless such next succeeding Banking Day
falls in a different calendar month, in which case such payment shall be made or
such Interest Period shall end (as the case may be) on the next preceding
Banking Day.
SECTION
6.02. Computations. Interest
shall be computed on the basis of a 360-day year and actual days
elapsed.
SECTION
6.03. Setoff or
Counterclaim. Each
payment by the Borrower under this Agreement or under the Note shall be made
without setoff or counterclaim. Lender shall have the right to charge
to the Payment Account and setoff any and all amounts owed by the Borrower under
this Agreement.
ARTICLE
VII
CONDITIONS
PRECEDENT
SECTION
7.01. Conditions Precedent to the
Loan. The
obligation of the Lender to make the Loan on the Closing Date is subject to the
fulfillment, to the satisfaction of the Lender, of all of the following
conditions precedent in addition to the conditions specified in Article
II:
(a) The
Borrower shall have executed and delivered to the Lender the Note, dated the
Closing Date.
(b) The
Lender shall have received on or before the Closing Date an executed copy
of:
(i) a
certificate of the Borrower, dated the Closing Date, substantially in the form
set forth in Exhibit
D-1 hereto together with the attachments specified therein;
(ii) a
certificate of XOMA, dated the Closing Date, substantially in the form set forth
in Exhibit D-2
hereto together with the attachments specified therein;
(iii) an
opinion of Conyers Dill & Pearman, special Bermuda counsel to XOMA and XOMA
Bermuda, dated the Closing Date, in form and substance satisfactory to the
Lender;
(iv) an
opinion of Cahill Gordon & Reindel LLP, U.S. counsel to the XOMA Parties,
dated the Closing Date, in form and substance satisfactory to the
Lender;
(v) an
opinion of Christopher J. Margolin, Vice President, General Counsel and
Secretary of XOMA, dated the Closing Date, in form and substance satisfactory to
the Lender; and
(vi) an
opinion of Anne Dollard, Senior Director of Intellectual Property of XOMA, dated
the Closing Date, in form and substance satisfactory to the Lender.
(c) The
Borrower shall have delivered to the Lender certified true copies of the
Borrower Documents.
(d) The
Borrower shall have executed and delivered to the Lender the Loan Documents
(including the amendment to the Security Agreement the form of which is
at-
tached
hereto as Exhibit
C) and such other documents as the Lender may reasonably request, in each
case, in form and substance satisfactory to the Lender.
(e) XOMA
Bermuda shall have executed and delivered to the Lender the representation
letter in the form set forth in Exhibit I (the “XOMA Bermuda Representation
Letter”).
(f) The
Transaction Documents shall be in full force and effect.
(g) The
Lender shall have received the upfront underwriting fee set forth in Section
2.05 and all other fees and expenses due and payable to the Lender on the
Closing Date under this Agreement and the other Transaction
Documents.
(h) The
organizational structure and capital structure of the Borrower shall be to the
satisfaction of the Lender.
(i) No event
shall have occurred and be continuing that constitutes a Default or an Event of
Default under this Agreement or a similar event under the other Transaction
Documents and no such event will occur or will have occurred by reason of the
Loan.
(j) The
representations and warranties made by the Borrower in Article VIII hlereof and
in the other Transaction Documents shall be true and correct as of the Closing
Date, before and after giving effect to the Loan.
(k) The
Borrower shall have delivered to the Lender certified true copies of the License
Agreements, including all amendments, supplements or other modifications
thereto, and each License Agreement and amendment, supplement or other
modification thereto shall be in full force and effect.
(l) All
filings, recordings and other actions that are necessary or reasonalbly
requested by the Lender in order to establish, protect, preserve and perfect the
security interest in the assets of the Borrower as provided in the Security
Agreement as a valid and perfected first priority security interest with respect
to such assets shall have been duly effected.
(m) All
necessary governmental and third-party approvals, consents and filings,
including in connection with the Loan and the acquisition of the Payment Rights
by the Borrower pursuant to the Acquisition Agreement shall have been obtained
or made and be in full force and effect.
(n) No
provision of the Acquisition Agreement shall have been waived, amended,
supplemented or otherwise modified without the written consent of the
Lender.
(o) The
Required Consents shall not have been rescinded, amended or
modified.
ARTICLE
VIII
REPRESENTATIONS
AND WARRANTIES
SECTION
8.01. Representations and
Warranties of the Borrower. The
Borrower makes the representations and warranties set forth below to the
Lender. Except as otherwise noted, the Borrower makes the
representations and warranties set forth below as of the Closing
Date:
(a) The
Borrower is a limited liability company duly organized, validly existing and in
good standing under the laws of Delaware, with its chief executive office at
2910 Seventh Street, Berkeley, California 94710, and has the power and authority
(including any required license, permit or other approval from any Governmental
Authority) to own its assets, to carry on its business as currently conducted
and to consummate the transactions contemplated in, and to perform its
obligations under, this Agreement and the other Transaction Documents to which
it is party or by which it is bound.
(b) The
Borrower has taken all necessary action to authorize its execution and delivery
of this Agreement and the other Transaction Documents to which it is party, the
performance of its obligations under this Agreement and the other Transaction
Documents to which it is party or by which it is bound and the consummation of
the transactions contemplated hereby and thereby.
(c) This
Agreement and each other Transaction Document to which the Borrower is party has
been duly executed and delivered by the Borrower, and each constitutes a valid
and binding obligation of the Borrower, enforceable against the Borrower in
accordance with its terms, subject to applicable bankruptcy, insolvency,
moratorium and similar laws affecting creditors’ rights generally, and subject
to general principles of equity (regardless of whether enforcement is sought in
a proceeding in equity or at law).
(d) No
authorization or action of any kind by any Governmental Authority is necessary
to authorize the transactions contemplated by this Agreement and each other
Transaction Document or required for the validity or enforceability against the
Borrower of this Agreement and each other Transaction Document, except any
filings with a Governmental Authority required to perfect the Lender’s security
interest under the Security Agreement.
(e) Except
for the Required Consents, no consent or approval of, or notice to, any Person
is required by the terms of any agreement, contract, lease, commitment, license
and other arrangement (each, a “Contract”) for the
execution or delivery of, or the performance of the obligations of the Borrower
under, this Agreement and the other Transaction Documents to which the Borrower
is party or the consummation of the transactions contemplated hereby or thereby,
and such execution, delivery, performance and consummation will not result in
any breach or violation of, or constitute a default under the Borrower Documents
or any material Contract, instrument or Law applicable to the Borrower or any of
its assets.
(f) There are
no actions, proceedings or claims pending or, to the knowledge of the Borrower,
threatened the adverse determination of which could reasonably be expected to
have a Material Adverse Effect.
(g) Since the
acquisition of the Payment Rights and the Raptiva Rights by the Borrower there
have been no events that could reasonably be expected to reduce or otherwise
impair the value of such rights.
(h) No
Default or Event of Default has occurred and is continuing, and no such event
will occur upon the making of the Loan.
(i) The
Borrower has good title to its assets free and clear of all Liens, other than
Liens created hereby and by the Security Agreement and the Permitted
Liens.
(j) With
respect to each Contract that is material to the business of the Borrower, (i)
each such Contract is a valid and binding agreement and each such Contract is in
full force and effect, and (ii) the Borrower is in compliance with each such
Contract and has no knowledge of any default under any such Contract which
default has not been cured or waived.
(k) All
written information heretofore, herein or hereafter supplied to the Lender by or
on behalf of the Borrower or any other XOMA Party in connection with the Loan
and the other transactions contemplated hereby has been, is and will be accurate
and complete. All representations and warranties made by the Borrower
or any other XOMA Party in any of the other Transaction Documents to which it is
party are true and correct.
(l) The
consolidated balance sheet of XOMA and its consolidated Subsidiaries as of
December 31, 2007 and the related consolidated statement of operations and cash
flows for the fiscal year then ended, accompanied by an opinion of Ernst &
Young LLP, independent registered public accountants, set forth in XOMA’s 2007
Form 10-K, and unaudited consolidated balance sheet of XOMA and its consolidated
Subsidiaries as of March 31, 2008 and the related consolidated statement of
operations and cash flows for the fiscal quarter then ended duly certified by
the chief financial officer of XOMA, copies of which have been furnished to the
Lender, fairly present the consolidated financial condition of XOMA and its
consolidated Subsidiaries for the periods ended on such dates, all in accordance
with GAAP consistently applied. Since the consolidated balance sheet
of XOMA and its consolidated Subsidiaries as at December 31, 2007, there has
been no material adverse change in the business, financial position or results
of operations of the XOMA and its consolidated Subsidiaries.
(m) The
Borrower has no Indebtedness other than (1) the Loan; (2) the loans of up to
$50,000,000 pursuant to the secured note agreement, dated May 26, 2005, between
the Borrower and Chiron Corporation (the “Chiron Loan”)
and (3) the Irrevocable Letter of Credit dated April 28, 2008 issued
by Wells Fargo Bank, N.A. in favor of Washington International Insurance Company
in the amount of $942,000 (the “Letter of
Credit”).
(n) As of the
date hereof and after giving effect to the Loan:
(i) The
aggregate value of the assets of the Borrower, at fair value and present fair
salable value, exceeds (i) its total liabilities and (ii) the amount required to
pay such liabilities as they become absolute and matured in the normal course of
business;
(ii) The
Borrower has the ability to pay its debts and liabilities as they become
absolute and matured in the normal course of business; and
(iii) The
Borrower does not have an unreasonably small amount of capital with which to
conduct its business.
(o) The
Borrower has no Subsidiaries.
(p) The
Borrower is in material compliance with all applicable Laws.
(q) None of
the transactions contemplated in this Agreement (including, without limitation,
the borrowing hereunder and the use of proceeds thereof) will violate or result
in a violation of Section 7 of the Exchange Act, including, without limitation,
Regulations T, U and X of the Board of
Governors of the Federal Reserve System, 12 C.F.R., Chapter II.
(r) The
Borrower is not an investment company subject to regulation under the Investment
Company Act of 1940.
(s) The
Borrower has timely filed all tax returns required to be filed by it and has
paid all taxes due reported on such returns or pursuant to any assessment
received by the Borrower, except for failures to file tax returns or pay taxes
that, individually, and in the aggregate, are not reasonably expected to result
in a Material Adverse Effect. Any charges, accruals or reserves on
the books of the Borrower in respect of taxes are adequate except for
inadequacies that, individually, and in the aggregate, are not reasonably
expected to result in a Material Adverse Effect. The Borrower has had
no material liability for any taxes imposed on or with respect to its net income
(except for state or local income or franchise taxes). The fact that
the income of the Borrower has been subject to taxes in the hands of XOMA is not
a breach of this representation provided the Borrower has had, and will have, no
liability for those taxes. The Borrower has fulfilled all of its
obligations with respect to withholding taxes except for failures that,
individually, and in the aggregate, are not reasonably expected to result in a
Material Adverse Effect.
(t) XOMA has
timely filed all tax returns required to be filed by it and has paid all taxes
due reported on such returns or pursuant to any assessment received by XOMA
except for failures to file tax returns or pay taxes that, individually, and in
the aggregate, are not reasonably expected to result in a Material Adverse
Effect. Any charges, accruals or reserves on the books of XOMA in
respect of taxes are adequate except for inadequacies that, individually, and in
the aggregate, are not reasonably expected to result in a Material Adverse
Effect. XOMA has treated all its U.S. domestic source income
at-
tributable
to income of the Borrower and XOMA Bermuda, as effectively connected with its
conduct of a U.S. trade or business within the meaning of Section 864 of the
Code.
(u) The
transfer of the Payment Rights from XOMA Bermuda to the Borrower pursuant to the
Acquisition Agreement does not result in any tax under Section 884 of the
Code.
(v) At the
end of its taxable year ending December 31, 2007, XOMA had net operating losses
for U.S. federal income tax purposes of at least $80,000,000 of which at least
$40,000,000 will not be subject to limitation under Section 382 of the Code and
will be available to offset income effectively connected with a trade or
business engaged in by XOMA in the United States for taxable years beginning on
or after January 1, 2008 and on or prior to the Maturity Date.
(w) The
Borrower shall have no liability for net income taxes (except for state or local
income or franchise Taxes, or foreign income Taxes not related to the Payment
Rights or Raptiva Rights). Absent a change in Law after the date of
this Agreement, payments with respect to the Payment Rights or Raptiva Rights
shall not be subject to any Taxes imposed on or with respect to gross or net
income (except state or local income or franchise Taxes) or withheld or deducted
from such payments and the Borrower will have no liability as a withholding
agent with respect to such payments, provided, however, that
payments with respect to Payment Rights from UCB are subject to withholding of
United Kingdom Tax. The foregoing representations (x) shall not be
violated solely by the fact that the income of the Borrower is subject to Taxes
in the hands of XOMA provided the Borrower
has no liability for those Taxes and (y) shall survive the Closing Date and be
made on a continuous basis until the Loan is repaid in full.
(x) The terms
(not including economic terms) of the Collaboration Agreement, dated November 1,
2006, between the Borrower and Takeda Pharmaceutical Company Limited, are
substantially similar to the terms (not including economic terms) of the
Schering Collaboration Agreement, dated May 22, 2006, between the Borrower and
Schering Corporation, acting through its Schering-Plough Research Institute
division.
(y) Neither
XOMA, the Borrower nor any ERISA Affiliate has ever incurred or expects to incur
any liability under Title IV or Section 302 of ERISA or Section 412 of the Code
or any similar non-U.S. law or maintains or contributes to, or is or has been
required to maintain or contribute to, any employee benefit plan (as defined in
Section 3(3) of ERISA) subject to Title IV or Section 302 of ERISA or Section
412 of the Code or any non-U.S. law. The consummation of the
transactions contemplated by this Agreement will not constitute or result in any
non-exempt prohibited transaction under Section 406 of ERISA, Section 4975 of
the Code or substantially similar provisions under any foreign or U.S. federal,
state or local laws, rules or regulations. Neither XOMA, the Borrower
nor any ERISA Affiliate has incurred any liability with respect to any
obligation to provide benefits, including death or medical benefits, with
respect to any person beyond their retirement or the termination of service
other than coverage mandated by law.
(z) XOMA
Technology Ltd. (a) owns and has good and exclusive title to, free and clear of
any Lien, and has independently developed or acquired all XOMA BCE/HE
Intellectual Property, or (b) has the valid right or license, free and clear of
any Lien, to all BCE/HE Intellectual Property.
(aa) Neither
the execution and delivery or effectiveness of this Agreement nor the
performance of the Borrower’s obligations hereunder will cause the forfeiture or
termination of, or give rise to a right of forfeiture or termination of, any
XOMA US Intellectual Property (other than Collaboration Intellectual Property),
or impair the right of the Borrower or any licensee (including any Obligor) to
use, possess, sell or license any XOMA US Intellectual Property (other than
Collaboration Intellectual Property) or portion thereof, or require payment of
any kind to any third party.
(bb) Each item
of XOMA BCE/HE Intellectual Property is valid and subsisting (or in the case of
applications, applied for), all registration, maintenance and renewal fees
currently due in connection with such XOMA BCE/HE Intellectual Property have
been paid, and all documents, recordations and certificates in connection with
such XOMA BCE/HE Intellectual Property required to be filed have been filed with
the relevant patent authorities in the United States or foreign jurisdictions,
as the case may be, for the purposes of prosecuting, maintaining and perfecting
such XOMA BCE/HE Intellectual Property.
(cc) There are
no legal actions, suits or proceedings pending (or, to the knowledge of the
Borrower, threatened) against the Borrower, XOMA or any of its Subsidiaries
alleging that it or they have infringed or are currently infringing any Third
Party Intellectual Property or alleging that the XOMA BCE/HE Intellectual
Property is not valid or unenforceable.
(dd) The
Borrower has not received any written opinion of counsel that CIMZIA™,
RAPTIVA® or
LUCENTIS™
infringes or misappropriates any Third Party Intellectual Property
Rights.
(ee) To the
knowledge of the Borrower, no current or former employee, consultant or
independent contractor of the Borrower has any right, license, claim or interest
whatsoever in or with respect to any BCE/HE Intellectual Property.
(ff) The
Borrower, by ownership, license or covenant not to sue, has the right to use all
XOMA US Intellectual Property (other than Collaboration Intellectual Property)
which is necessary for use in connection with its business as presently
conducted and as proposed to be conducted.
(gg) To the
knowledge of Borrower, there is no existing infringement by any third party of
any of the XOMA US Intellectual Property (other than Collaboration Intellectual
Property) that is necessary for use in connection with the Borrower’s business
as presently conducted, other than infringement by third parties of the patent
rights listed in Exhibit J under the
heading “XOMA Patent Rights — Bacterial Expression” of which the Borrower is
aware as a result of the efforts of its Affiliate, XOMA Ireland Ltd. (“XOMA
Ireland”), in
connection with XOMA Ireland’s on-going bacterial cell expression technology
out-licensing program (the “BCE Program”), which
third parties XOMA Ireland has approached, or intends to approach, as part of
the BCE Program to determine whether such third parties will take a license to
such patent rights, pay for a release from past infringement thereof
and/
or reach some other appropriate form of
accommodation.
(hh) There are
no legal actions, suits or proceedings pending (or, to the knowledge of the
Borrower, threatened) against the Borrower, XOMA or any of its Subsidiaries
challenging their rights in or to, or the validity or enforceability of, the
XOMA US Intellectual Property (other than Collaboration Intellectual
Property).
(ii) There are
no legal actions, suits or proceedings pending (or, to the knowledge of the
Borrower, threatened) against the Borrower, XOMA or any of its Subsidiaries
alleging that the business of the Borrower infringes or otherwise violates, or
that the commercialization of any of the products under development by the
Borrower would infringe or otherwise violate, any patent, trademark, copyright,
trade secret or other proprietary rights of others.
(jj) All of
the XOMA US Intellectual Property (other than Collaboration Intellectual
Property) was filed and is being maintained or prosecuted in accordance with the
applicable rules and regulations relating thereto.
SECTION
8.02. Survival of Representations
and Warranties. All
representations and warranties of the Borrower contained in this Agreement shall
survive the execution, delivery and acceptance thereof by the Parties and the
closing of the transactions described in this Agreement.
ARTICLE
IX
AFFIRMATIVE
COVENANTS
SECTION
9.01. Maintenance of
Existence. The
Borrower shall at all times (a) preserve, renew and maintain in full force and
effect its legal existence and good standing as a limited liability company
under the Laws of the jurisdiction of its organization; (b) not change its name
or its chief executive office as set forth herein without having given the
Lender not less than 30 days’ prior notice thereof; (c) take all reasonable
action to maintain all rights, privileges, permits, licenses and franchises
necessary or desirable in the normal conduct of its business, except to the
extent that failure to do so could not reasonably be expected to have a Material
Adverse Effect; and (d) preserve or renew all XOMA US Intellectual Property, the
non-preservation of which could reasonably be expected to have a Material
Adverse Effect.
SECTION
9.02. Maintenance of Single Owner
and Status as Disregarded Entity for Tax Purposes. The
Borrower shall at all times be a “disregarded entity” for U.S. federal income
tax purposes owned by XOMA.
SECTION
9.03. Treatment of U.S. Domestic
Source Income. XOMA
will treat all payments with respect to the Payment Rights and the Raptiva
Rights as effectively connected with its conduct of a U.S. trade or business
within the meaning of Section 864 of the Code.
SECTION
9.04. Use of
Proceeds. The
Borrower shall use the net proceeds of the Loan received by it (i) to refinance
the loan under the Original Loan Agreement (which was used to fund the
acquisition of the Payment Rights pursuant to the Acquisition Agreement), (ii)
for general corporate purposes and (iii) to pay all fees and expenses payable by
the Borrower pursuant to the Transaction Documents.
SECTION
9.05. Financial Statements and
Information.
(a) In the
event that any such information need not to be filed with the Securities and
Exchange Commission pursuant to Section 13 or 15(d) of the Exchange Act, the
Borrower shall furnish to the Lender, on or before the thirtieth day after the
close of each quarter of each fiscal year, the unaudited consolidated balance
sheet of XOMA as at the close of such quarter and unaudited consolidated
statement of operations and cash flows of XOMA for such quarter, duly certified
by the chief financial officer of XOMA as having been prepared in accordance
with GAAP. Concurrently with the delivery or filing of the documents
described in the preceding sentence, the Borrower shall furnish to the Lender a
certificate of the chief financial officer, chief accounting officer or
treasurer of XOMA, which certificate shall (A) include a statement that
such officer has no knowledge, except as specifically stated, of any condition,
event or act which constitutes a Default or Event of Default and (B) set
forth in reasonable detail the calculations necessary to demonstrate compliance
with Section 10.08 on the date of such balance sheet. In the event
that generally accepted accounting principles used in the preparation of such
financial statements described in the first sentence above shall differ from
GAAP, XOMA shall also provide, if necessary for the determination of compliance
with Section 10.08, a statement of reconciliation conforming such financial
statements to GAAP.
(b) In the
event that any such information need not be filed with the Securities and
Exchange Commission pursuant to Section 13 or 15(d) of the Exchange Act,
the Borrower shall furnish to the Lender, on or before the forty-fifth day after
the close of each fiscal year, XOMA’s audited financial statements as at the
close of such fiscal year, including the consolidated balance sheet as at the
end of such fiscal year and consolidated statement of operations and cash flows
of XOMA for such fiscal year, in each case accompanied by the report thereon of
independent registered public accountant of nationally recognized
standing. Concurrently with the delivery or filing of the documents
described in the preceding sentence, the Borrower shall furnish to the Lender a
certificate of the chief financial officer, chief accounting officer or
treasurer of XOMA, which certificate shall (A) include a statement that
such officer has no knowledge, except as specifically stated, of any condition,
event or act which constitutes a Default or Event of Default and (B) set
forth in reasonable detail the calculations necessary to demonstrate compliance
with Section 10.08 on the date of such financial statements. In the
event that generally accepted accounting principles used in the preparation of
such financial statements described in the first sentence above shall differ
from GAAP, XOMA shall also provide, if necessary for the determination of
compliance with Section 10.08, a statement of reconciliation conforming such
financial statements to GAAP.
(c) The
Borrower shall, promptly upon receipt thereof, forward or cause to be forwarded
to the Lender copies of all notices, reports, updates and other information
regarding the License Agreements, the Payment Rights and the Raptiva Rights
received from the Obligors.
(d) The
Borrower shall furnish or cause to be furnished to the Lender from time to time
such other information regarding the financial position, assets or business of
the Borrower or any other XOMA Party or its compliance with any Transaction
Document to which it is a party as the Lender may from time to time reasonably
request.
SECTION
9.06. Books and
Records. The
Borrower shall keep proper books, records and accounts in which entries in
conformity with sound business practices and all requirements of Law applicable
to it shall be made of all dealings and transactions in relation to its
business, assets and activities and as shall permit the preparation of the
consolidated financial statements of XOMA in accordance with GAAP.
SECTION
9.07. Inspection Rights;
Access. The
Borrower shall, one occasion per year, or, if a Default or Event of Default
shall have occurred and be continuing, at all times permit representatives of
the Lender to examine its assets, books and records upon reasonable Notice
during normal business hours. The Borrower shall allow the Lender
reasonable access to its managers and/or officers.
SECTION
9.08. Payment
Account. Borrower
shall use commercially reasonable efforts to ensure that at all times the
Obligors shall make all payments with respect to the Payment Rights and the
Raptiva Rights directly into the Payment Account. In the event that
payments with respect to the Payment Rights or Raptiva Rights are directed to
the Borrower, the Borrower shall promptly transfer all such payments to the
Payment Account.
SECTION
9.09. Maintenance of Insurance and
Properties. The
Borrower shall maintain and preserve all of its properties that are used and
useful in the conduct of its business in good working order and condition,
ordinary wear and tear excepted. The Borrower shall maintain and
preserve the value as of the Closing Date, without any reduction or impairment,
of the Payment Rights and the Raptiva Rights. The Borrower shall
maintain with financially sound and reputable insurance companies, insurance on
all of its assets in at least such amounts and against at least such risks as
are usually insured against in the same general area by companies engaged in the
same or a similar business. The Borrower shall furnish to the Lender
from time to time upon written request full information as to the insurance
carried.
SECTION
9.10. Governmental
Authorizations. The
Borrower shall obtain, make and keep in full force and effect all authorizations
from and registrations with Governmental Authorities that may be required for
the validity or enforceability against the Borrower of this Agreement and the
other Transaction Documents to which it is a party.
SECTION
9.11. Compliance with Laws and
Contracts.
(a) The
Borrower shall comply with all applicable Laws and perform its obligations under
all Contracts relative to the conduct of its business, including the Transaction
Documents to which it is party.
(b) The
Borrower shall at all times comply with the margin requirements set forth in
Section 7 of the Exchange Act and any regulations issued pursuant thereto,
including, without limitation, Regulations T, U and X of the Board of Governors
of the Federal Reserve System, 12 C.F.R., Chapter II.
(c) The
Borrower shall use commercially reasonable efforts to enforce the obligations of
the Obligors in respect of the Payment Rights and the Raptiva Rights and shall,
upon receipt of reasonable instruction from the Lender, exercise all rights and
remedies available to it against the Obligors in respect of the Payment Rights,
the Raptiva Rights and the Collaboration Agreement.
SECTION
9.12. Plan
Assets. Neither
XOMA, Borrower nor any ERISA Affiliate shall take any action that causes it to
be deemed to be or hold Plan Assets at any time.
SECTION
9.13. Notices.
(a) The
Borrower shall promptly give written Notice to the Lender of each Default or
Event of Default and each other event that has or could reasonably be expected
to have a Material Adverse Effect or that could reduce or otherwise impair the
value of the Payment Rights or the Raptiva Rights.
(b) The
Borrower shall promptly give written Notice to the Lender upon receiving notice,
or otherwise becoming aware, of any default or event of default under the
License Agreements or the Acquisition Agreement.
(c) The
Borrower shall, promptly after becoming aware thereof, give written Notice to
the Lender of any litigation or proceedings to which the Borrower is a party or
which could reasonably be expected to have a Material Adverse Effect or that
could reduce or otherwise impair the value of the Payment Rights or the Raptiva
Rights.
(d) The
Borrower shall, promptly after becoming aware thereof, give written Notice to
the Lender of any litigation or proceedings challenging the validity of the
Payment Rights, the Raptiva Rights, the License Agreements, the Acquisition
Agreement, the Payment Rights-Related Intellectual Property or the Raptiva
Rights-Related Intellectual Property or any of the transactions contemplated
therein.
SECTION
9.14. Payment of
Taxes. The
Borrower shall pay all material taxes of any kind imposed on or in respect of
its income or assets before any penalty or interest accrues on the amount
payable and before any Lien on any of its assets exists as a result of
nonpayment.
SECTION
9.15. Waiver of Stay, Extension or
Usury Laws. The
Borrower will not at any time, to the extent that it may lawfully not do so,
insist upon, or plead, or in any manner whatsoever claim or take the benefit or
advantage of, any stay or extension law or any usury law or other law that would
prohibit or forgive the Borrower from paying all or any portion of the principal
of or premium, if any, or interest on the Loan as contemplated herein, wherever
enacted, now or at any time hereafter in force, or that may affect the covenants
or the performance of this Agreement; and, to the extent that it may lawfully do
so, the Borrower hereby expressly waives all benefit or advantage of any such
law and expressly agrees that it will not hinder, delay or impede the execution
of any power herein granted to the Lender, but will suffer and permit the
execution of every such power as though no such law had been
enacted.
SECTION
9.16. Further
Assurances. The
Borrower shall promptly, at its sole cost and expense, execute and deliver to
the Lender such further instruments and documents, and
take such
further action, as the Lender may, at any time and from time to time, reasonably
request in order to carry out the intent and purpose of this Agreement and the
other Transaction Documents to which it is a party and to establish and protect
the rights, interests and remedies created, or intended to be created, in favor
of the Lender hereby and thereby. The Borrower shall pay, or
reimburse the Lender for, any and all reasonable fees, costs and expenses of
whatever kind or nature incurred in connection with the creation, preservation
and protection of the Lender’s Lien on the assets of the Borrower under the
Security Agreement, including reasonable legal and other fees in connection with
the recording or filing of instruments and documents in public offices, payment
or discharge of any Liens upon or in respect of such assets of the Borrower,
other fees, costs and expenses in connection with protecting, maintaining or
preserving such assets of the Borrower and the Lender’s interest therein,
whether through judicial proceedings or otherwise, or in defending or
prosecuting any actions, suits or proceedings arising out of or related to such
assets of the Borrower; and all such amounts that are paid by the Lender shall,
until reimbursed by the Borrower, constitute Obligations secured by such assets
of the Borrower.
ARTICLE
X
NEGATIVE
COVENANTS
SECTION
10.01. Activities of the
Borrower.
(a) The
Borrower shall not enter into any business either directly or through any
Subsidiary except for businesses in which the Borrower is engaged on the date of
this Agreement.
(b) The
Borrower shall not amend, modify or waive or terminate any provision of, or
permit or agree to the amendment, modification, waiver or termination of any
provision of, any of the Loan Documents, License Agreements or the Acquisition
Agreement without the prior written consent of the Lender (it being understood
that the Lender shall be entitled to withhold its consent if such amendment,
modification or waiver is or would be adverse in any respect to the Lender, as
determined by the Lender in its sole discretion).
SECTION
10.02. Merger; Sale of
Assets.
(a) The
Borrower shall not merge or consolidate with or into any other
Person.
(b) The
Borrower shall not directly or indirectly sell, lease, license, transfer or
otherwise dispose of all or any part of its assets, except (i) for the sale of
or licensing of rights to one or more of the Borrower’s or its Affiliates’
existing or future products and related assets to one or more third parties for
fair value in an arm’s-length transaction in the ordinary course of business;
(ii) in connection with additional product development, collaboration or
commercialization agreements (other than with respect to the Raptiva
Rights-Related Intellectual Property or the Payment Rights-Related Intellectual
Property) for research, development or commercialization activities with one or
more third parties for fair value in an arm’s-length transaction in the ordinary
course of business; (iii) licenses of intellectual property rights of the
Borrower in connection with services provided by the Borrower for fair value in
an arm’s-length transaction in the ordinary course of its business; (iv) sales
of equipment not needed for the Borrower’s busi-
ness to
one or more third parties for fair value in an arm’s-length transaction; (v)
sales of equipment to one or more third parties for fair value in an
arm’s-length transaction, the proceeds of which are used to purchase replacement
or other assets useful in the Borrower’s business within twelve months of such
sale and (vi) other sales, leases, licenses, transfers or other dispositions in
an aggregate amount not to exceed $1,000,000 during the term of the
agreement.
SECTION
10.03. Liens. The
Borrower shall not create or suffer to exist any Lien on or with respect to any
of its assets, whether now owned or hereafter acquired, other than the following
(collectively, “Permitted
Liens”):
(a) Liens
created pursuant to this Agreement and the Security Agreement;
(b) Liens
existing on the date hereof set forth in Exhibit E to the extent and in the
manner such Liens are in effect on the date hereof;
(c) any Lien
granted to collaboration or development partners of the Borrower or its
Affiliates in connection with funded research, development and commercialization
activities (other than on or with respect to the Raptiva Rights, the Payment
Rights, the Raptiva Rights-Related Intellectual Property or the Paymentl
Rights-Related Intellectual Property); provided, that any
such Lien is limited to the Borrower’s interest in products developed in such
collaboration;
(d) any Lien
on any asset securing Indebtedness incurred or assumed for the purpose of
financing all or any part of the cost of acquiring such asset; provided that such
Lien attaches to such asset concurrently with or within 90 days after the
acquisition thereof;
(e) any Lien
existing on any asset prior to the acquisition thereof by the Borrower and not
created in contemplation of such acquisition;
(f) any Lien
created after the Closing Date in connection with capitalized lease obligations,
but only to the extent that such Lien encumbers property financed by such
capital lease obligation and the principal component of such capitalized lease
obligation is not increased; provided that capital
lease obligations secured by Liens pursuant to this clause (f) shall not
exceed in the aggregate $2,000,000;
(g) Liens
arising in the ordinary course of its business which (i) do not secure
Indebtedness and (ii) do not in the aggregate materially impair the operation of
the business of the Borrower or impair the value of the Payment Rights and the
Raptiva Rights; provided that the
assets secured by Liens pursuant to this clause (g) shall not exceed in the
aggregate $2,000,000;
(h) easements,
rights-of-way, zoning restrictions and other similar charges or encumbrances in
respect of real property not interfering with the ordinary conduct of the
business of the Borrower;
(i) any Lien
arising out of the refinancing, extension, renewal or refunding of any
Indebtedness secured by any Lien permitted by any of the foregoing clauses of
this
Section
10.03; provided
that such Indebtedness is not increased and is not secured by any additional
assets; and
(j) Liens
securing taxes, assessments, fees or other governmental charges or levies, Liens
securing the claims of materialmen, mechanics, carriers’ landlords, warehousemen
and similar Persons, Liens in the ordinary course of business in connection with
workmen’s compensation, unemployment insurance and other similar Laws, Liens to
secure surety, appeal and performance bonds and other similar obligations not
incurred in connection with the borrowing of money, and attachment, judgment and
other similar Liens arising in connection with court proceedings so long as the
enforcement of such Liens is effectively stayed and the claims secured thereby
are being contested in good faith by appropriate proceedings.
SECTION
10.04. No
Subsidiaries. The
Borrower shall not form any Subsidiaries or conduct any business or hold any
assets through any Subsidiary.
SECTION
10.05. Investment Company
Act. The
Borrower shall not be or become an investment company subject to registration
under the Investment Company Act of 1940.
SECTION
10.06. Limitation on Additional
Indebtedness. The
Borrower shall not, directly or indirectly, incur or suffer to exist any
Indebtedness; provided that the
Borrower may incur:
(a) Indebtedness
under this Agreement;
(b) Indebtedness
secured by Liens permitted under Section 10.03 other than Section 10.03(c) (but,
in the case of Liens permitted under Section 10.03(b), only to the extent of the
Indebtedness related thereto); or
(c) any
Indebtedness relating to a collaboration or development agreement of the type
contemplated in Section 10.03(c), which by its terms (or by the terms of any
agreement governing such Indebtedness) is fully subordinated (including in right
of payment and exercise of remedies) to the Obligations except with respect to
the rights of the relevant collaboration or development partner in respect of
its Lien, if any, permitted under the proviso of Section 10.03(c); provided that no such
subordination shall be required for Indebtedness relating to any such
collaboration or development agreement providing for Indebtedness and existing
on the date hereof as set forth on Exhibit K.
Notwithstanding
anything to the contrary herein, the Borrower shall not incur any Indebtedness
in favor of Wells Fargo Bank, N.A. or its Affiliates other than the Letter of
Credit.
SECTION
10.07. Limitation on Transactions
with Affiliates. The
Borrower shall not, directly or indirectly, enter into any transaction or series
of related transactions or participate in any arrangement (including any
purchase, sale, lease or exchange of assets or the rendering of any service)
with, or for the benefit of, any Affiliate other than the Transaction Documents
or in the ordinary course of business of the Borrower upon fair and reasonable
terms no less favorable to the Borrower than it would obtain in a comparable
arm’s-length transaction with a non-Affiliate.
SECTION
10.08. Interest Coverage
Ratio. For
each Interest Payment Date following the Closing Date, the Borrower shall not
permit the Interest Coverage Ratio in respect of such Interest Payment Date to
be less than 3.0.
SECTION
10.09. ERISA.
(a) Neither
XOMA nor the Borrower shall maintain or contribute to, or agree to maintain or
contribute to or otherwise incur any liability with respect to, any employee
benefit plan (as defined in Section 3(3) of ERISA) subject to Title IV or
Section 302 of ERISA or Section 412 of the Code or any similar plan under
non-U.S. law (a “Plan”). Neither
XOMA nor the Borrower shall incur any liability under Title IV or Section 302 of
ERISA or Section 412 of the Code or any similar non-U.S. law in respect of any
Plan that is maintained by an ERISA Affiliate.
(b) Neither
XOMA, the Borrower nor any ERISA Affiliate shall engage in a non-exempt
prohibited transaction under Section 406 of ERISA, Section 4975 of the Code, or
substantially similar provisions under foreign or U.S. federal, state or local
laws, rules or regulations or in any transaction that would cause any obligation
or action taken or to be taken hereunder (or the exercise by the Lender of any
of its rights under the Note, this Agreement or the Security Agreement) to be a
non-exempt prohibited transaction under such provisions.
(c) Neither
XOMA, the Borrower nor any ERISA Affiliate will incur any liability with respect
to any obligation to provide benefits, including death or medical benefits, with
respect to any person beyond their retirement or other termination of service
other than coverage mandated by law.
ARTICLE
XI
EVENTS OF
DEFAULT
SECTION
11.01. Events of
Default. If
one or more of the following events of default (each, an “Event of Default”)
occurs and is continuing, the Lender shall be entitled to the remedies set forth
in Section 11.02:
(a) The
Borrower fails to pay any principal of the Loan when due, whether at the
Maturity Date or otherwise.
(b) The
Borrower fails to pay any interest on the Loan or make payment of any other
amounts payable under this Agreement within three Banking Days after the same
becomes due and payable.
(c) Any
representation or warranty of the Borrower or XOMA in this Agreement or any
other Transaction Document to which it is party or in any certificate, financial
statement or other document delivered by the Borrower or XOMA in connection with
this Agreement proves to have been incorrect, incomplete or misleading in any
material respect at the time it was made or repeated.
(d) The
Borrower or XOMA, as applicable, fails to perform or observe any covenant or
agreement contained in Section 9.01, Section 9.04, Section 9.11(b),
Section
9.11(c),
Section 9.12, Section 9.13, Article X or Section 12.07 of this Agreement or
Section 4.08 or Section 4.12 of the Security Agreement.
(e) The
Borrower fails to perform or observe any other covenant or agreement contained
in this Agreement, the Note or the Security Agreement (other than those referred
to in the preceding clauses of this Section 11.01) if such failure is not
remedied on or before the thirtieth day after Notice thereof from the
Lender.
(f) The
Borrower (i) fails to pay any of its Indebtedness as and when that Indebtedness
becomes payable (whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise) or (ii) fails to perform or observe any
covenant or agreement to be performed or observed by it contained in any other
agreement or in any instrument evidencing any of its Indebtedness and, as a
result of such failure, any other party to that agreement or instrument is
entitled to exercise the right to accelerate the maturity of any amount owing
thereunder or any such amount is accelerated; provided, however, that a
failure to pay Indebtedness shall not constitute an Event of Default under this
clause (f) if (x) the overdue amounts in the aggregate do not exceed $3,000,000
(or the equivalent in another currency or currencies), (y) the obligation to pay
the overdue amounts has not resulted from acceleration and (z) the failure is
remedied on or before the thirtieth day after it occurs.
(g) XOMA
Bermuda shall sell, assign, lease, license, transfer or otherwise dispose of the
Payment Rights-Related Intellectual Property with respect to the Payment Rights,
the LUCENTIS License Agreement and/or the CIMZIA License Agreement or any XOMA
Party takes any action, directly or indirectly, which could reasonably be
expected to impair the value of or Lender’s access to the Collateral (as defined
in the Security Agreement).
(h) Any
judgment, decree or order shall be rendered against the Borrower and either (i)
enforcement proceedings shall have been commenced upon such judgment, decree or
order or (ii) such judgment, decree or order shall not have been vacated or
discharged within thirty days from entry.
(i) Any XOMA
Party or any Obligor (i) is dissolved or commences proceedings for
dissolution, (ii) fails or is unable to pay its debts generally as they
become due, (iii) commences a voluntary case in bankruptcy or any other action
or proceeding for any other relief under any law affecting creditors’ rights
that is similar to a bankruptcy law or (iv) consents by answer or otherwise to
the commencement against it of an involuntary case in bankruptcy or any other
such action or proceeding; or a court enters an order for relief or a decree in
an involuntary case in bankruptcy or any other such action or proceeding in
respect of any such Person or any of the assets of any such Person if such order
or decree is not dismissed or withdrawn on or before the sixtieth day after the
entry thereof or if any such dismissal or withdrawal ceases to remain in
effect.
(j) Any of
the Transaction Documents shall cease to be in full force and effect or its
validity or enforceability is disaffirmed or challenged in writing by any Person
other than the Lender or the Security Agreement shall cease to give the Lender
the rights
purported
to be created thereby (including a first priority perfected Lien on the assets
of the Borrower).
(k) Any of a
Borrower Change of Control, a XOMA Bermuda Change of Control or a XOMA Change of
Control occurs.
(l) (i) Any
representation or warranty of the Borrower or XOMA Bermuda in the Acquisition
Agreement or the XOMA Bermuda Representation Letter proves to have been
incorrect, incomplete or misleading in any respect at the time it was made; (ii)
the Borrower or XOMA Bermuda fails to perform or observe any covenant or
agreement contained in the Acquisition Agreement, the XOMA Bermuda
Representation Letter, any License Agreement or the Borrower Documents, as
applicable, and such failure is not cured or waived within any applicable grace
period or (iii) any Obligor fails to perform or observe any covenant or
agreement contained in any License Agreement and such failure is not cured or
waived within any applicable grace period or asserts a Dispute with respect to
the Payment Rights, the Raptiva Rights or the Collaboration
Agreement.
(m) In
connection with a challenge to the validity of the Payment Rights, the Raptiva
Rights or any Payment Rights-Related Intellectual Property or Raptiva
Rights-Related Intellectual Property or any transaction contemplated under the
License Agreements or the Acquisition Agreement, any judgment, decree or order
is issued that (i) halts or suspends the payment by any Obligor or XOMA Bermuda
of any amount payable in respect of the Payment Rights or under the
Collaboration Agreement, or (ii) otherwise determines that the Payment Rights or
the Collaboration Agreement have not been duly authorized or validly issued or
that the Payment Rights or the Collaboration Agreement are not enforceable in
accordance with the terms of the applicable License Agreement or the Acquisition
Agreement, and such judgment, decree or order shall not have been vacated or
discharged within 10 days from entry.
(n) Any of
the revenue milestones set forth in Exhibit F shall not
have been achieved by the date indicated.
(o) Any
provision of Article XII shall for any reason cease to be valid and binding or
enforceable against XOMA or XOMA shall so state in writing.
SECTION
11.02. Default
Remedies. If
any Event of Default shall occur, the Lender may, by Notice to the Borrower, (a)
exercise all rights and remedies available to the Lender hereunder and under the
Security Agreement, including enforcement of the security interests created
thereby, (b) declare the Loan, all interest thereon and all other amounts
payable hereunder and under the Note by the Borrower to be immediately due and
payable, whereupon all such amounts shall become immediately due and payable,
all without diligence, presentment, demand of payment, protest or further notice
of any kind, which are expressly waived by the Borrower and (c) declare the
obligations of the Lender hereunder to be terminated, whereupon such obligations
shall terminate, provided, however, that if any
event of any kind referred to in Section 11.01(i) occurs, the obligations of the
Lender hereunder shall immediately terminate, all amounts payable hereunder by
the Borrower shall become immediately due and payable and the Lender shall be
entitled to exercise rights and remedies under the Security Agreement
without
diligence,
presentment, demand of payment, protest or notice of any kind, all of which are
hereby expressly waived by the Borrower. Each Notice delivered
pursuant to this Section 11.02 shall be effective when sent.
SECTION
11.03. Right of
Set-off. If
any amount payable hereunder is not paid as and when due, the Borrower
irrevocably authorizes the Lender and each Affiliate of the Lender (i) to
proceed, to the fullest extent permitted by applicable Law, without prior
notice, by right of set-off, bankers’ lien, counterclaim or otherwise, against
any assets of the Borrower in any currency that may at any time be in the
possession of the Lender or such Affiliate, to the full extent of all amounts
payable to the Lender hereunder or (ii) to charge to the Payment Account the
full extent of all amounts payable by the Borrower to the Lender hereunder;
provided, however, that the
Lender shall notify the Borrower of the exercise of such right promptly
following such exercise.
SECTION
11.04. Rights Not
Exclusive. The
rights provided for herein are cumulative and are not exclusive of any other
rights, powers, privileges or remedies provided by Law.
ARTICLE
XII
GUARANTEE
SECTION
12.01. Guarantee. XOMA
hereby absolutely, unconditionally and irrevocably guarantees, as a guarantee of
payment and not of collection, the punctual payment when due, whether at
scheduled maturity or on any date of a required prepayment or by acceleration,
demand or otherwise, of all obligations of the Borrower now or hereafter
existing under or in respect of this Agreement and the Loan Documents (including
any extensions, modifications, substitutions, amendments or renewals of any or
all of the foregoing obligations), whether direct or indirect, absolute or
contingent, and whether for principal, interest, premiums, fees, indemnities,
contract causes of action, costs, expenses or otherwise (such obligations being
the “Guaranteed
Obligations”), and agrees to pay any and all expenses (including fees and
expenses of counsel) incurred by the Lender in enforcing any rights under this
Article XII. Without limiting the, generality
of the foregoing, XOMA’s liability shall extend to all amounts that constitute
part of the Guaranteed Obligations and would be owed by the Borrower to the
Lender under or in respect of this Agreement or any Loan Document but for the
fact that they are unenforceable or not allowable due to the existence of a
bankruptcy, reorganization or similar proceeding involving the
Borrower.
SECTION
12.02. Guarantee
Absolute
(a) XOMA
guarantees that the Guaranteed Obligations will be paid strictly in accordance
with the terms of this Agreement and the Loan Documents regardless of any law,
regulation or order now or hereafter in effect in any jurisdiction affecting any
of such terms or the rights of the Lender with respect thereto. The
obligations of XOMA under or in respect of this Article XII are independent of
the Guaranteed Obligations or any other obligations of the Borrower under or in
respect of this Agreement and any Loan Documents and a separate action or
actions may be brought and prosecuted against XOMA to enforce this Article XII,
irrespective of whether any action is brought against the Borrower or whether
the Borrower is joined in any
such
action or actions. The liability of XOMA under this Article XII shall
be irrevocable, absolute and unconditional irrespective of, and XOMA hereby
irrevocably waives any defenses it may now have or hereafter acquire in any way
relating to, any or all of the following:
(i) any lack
of validity or enforceability of this Agreement (other than this Article XII),
the Note or any agreement or instrument relating thereto;
(ii) any
change in the time, manner or place of payment of, or in any other term of, all
or any of the Guaranteed Obligations or any other obligations of the Borrower
under or in respect of this Agreement or the Loan Documents or any other
amendment or waiver of or any consent to departure from this Agreement or the
Loan Documents, including any increase in the Guaranteed Obligations resulting
from the extension of additional credit to the Borrower or
otherwise;
(iii) any
taking, exchange, release or non-perfection of any Collateral (as defined under
the Security Agreement), or any taking, release or amendment or waiver of, or
consent to departure from, any other guaranty, for all or any of the Guaranteed
Obligations;
(iv) any
manner of application of Collateral, or proceeds thereof, to all or any of the
Guaranteed Obligations, or any manner of sale or other disposition of any
Collateral for all or any of the Guaranteed Obligations or any other obligations
of the Borrower under this Agreement or the Loan Documents or any other assets
of the Borrower;
(v) any
change, restructuring or termination of the corporate structure or existence of
the Borrower or any of its Subsidiaries; or
(vi) any other
circumstance (including any statute of limitations) or any existence of or
reliance on any representation by the Lender that might otherwise constitute a
defense available to, or a discharge of, the Borrower or any other guarantor or
surety.
(b) This
Article XII shall continue to be effective or be reinstated, as the case may be,
if at any time any payment of any of the Guaranteed Obligations is rescinded or
must otherwise be returned by the Lender or any other Person upon the
insolvency, bankruptcy or reorganization of the Borrower or otherwise, all as
though such payment had not been made.
SECTION
12.03. Waivers and
Acknowledgments.
(a) XOMA
unconditionally and irrevocably waives promptness, diligence, notice of
acceptance, presentment, demand for performance, notice of nonperformance,
default, acceleration, protest or dishonor and any other notice with respect to
any of the Guaranteed Obligations and this Article XII and any requirement that
the Lender protect, secure, perfect or insure any Lien or any property subject
thereto or exhaust any right or take any action against the Borrower or any
other Person or any collateral.
(b) XOMA
hereby unconditionally and irrevocably waives any right to revoke this Article
XII and acknowledges that the guaranty under this Article XII is continuing in
nature and applies to all Guaranteed Obligations, whether existing now or in the
future.
(c) XOMA
hereby unconditionally and irrevocably waives (i) any defense arising by reason
of any claim or defense based upon an election of remedies by the Lender that in
any manner impairs, reduces, releases or otherwise adversely affects the
subrogation, reimbursement, exoneration, contribution or indemnification rights
of XOMA or other rights of XOMA to proceed against the Borrower, any other
guarantor or any other Person or any Collateral and (ii) any defense based on
any right of set-off or counterclaim against or in respect of the obligations of
XOMA hereunder.
(d) XOMA
hereby unconditionally and irrevocably waives any duty on the part of the Lender
to disclose to XOMA any matter, fact or thing relating to the business,
financial condition, operations, performance, properties or prospects of the
Borrower now or hereafter known by the Lender.
(e) XOMA
acknowledges that it will receive substantial direct and indirect benefits from
the financing arrangements contemplated by this Agreement and the Loan Documents
and that the waivers set forth in Section 12.02 and this Section 12.03 are
knowingly made in contemplation of such benefits.
SECTION
12.04. Subrogation. XOMA
hereby unconditionally and irrevocably agrees not to exercise any rights that it
may now have or hereafter acquire against the Borrower or any other insider
guarantor that arise from the existence, payment, performance or enforcement of
XOMA’s obligations under or in respect of this Article XII, including any right
of subrogation, reimbursement, exoneration, contribution or indemnification and
any right to participate in any claim or remedy of the Lender against the
Borrower or any other insider guarantor or any collateral, whether or not such
claim, remedy or right arises in equity or under contract, statute or common
law, including the right to take or receive from the Borrower or any other
insider guarantor, directly or indirectly, in cash or other property or by
set-off or in any other manner, payment or security on account of such claim,
remedy or right, unless and until all of the Guaranteed Obligations and all
other amounts payable under this Article XII shall have been paid in full in
cash. If any amount shall be paid to XOMA in violation of the
immediately preceding sentence at any time prior to the payment in full in cash
of the Guaranteed Obligations and all other amounts payable under this Article
XII, such amount shall be received and held in trust for the benefit of the
Lender, shall be segregated from other property and funds of XOMA and shall
forthwith be paid or delivered to the Lender in the same form as so received
(with any necessary endorsement or assignment) to be credited and applied to the
Guaranteed Obligations and all other amounts payable under this Article XII,
whether matured or unmatured, in accordance with the terms of this Agreement, or
to be held as collateral for any Guaranteed Obligations or other amounts payable
under this Article XII thereafter arising.
SECTION
12.05. Continuing
Guarantee. The
guarantee under this Article XII is a continuing guarantee and shall (a) remain
in full force and effect until the payment in full in cash of the Guaranteed
Obligations and all other amounts payable under this Article XII, (b) be binding
upon XOMA, its successors and assigns and (c) inure to the benefit of and be
enforceable by the Lender and its successors, transferees and
assigns. XOMA shall not have the right to assign its obligations
hereunder, whether voluntarily, involuntarily or by operation of law, without
the prior written consent of the Lender and any purported assignment in
violation of this Section 12.05 shall be null and void.
SECTION
12.06. Representations and
Warranties of XOMA. XOMA
makes the representations and warranties below to the Lender. Except
as otherwise noted, XOMA makes such representations and warranties as of the
Closing Date.
(a) XOMA is
an exempted company duly incorporated, validly existing and in good standing
under the laws of Bermuda and has the power and authority (including any
required license, permit or other approval from any Governmental Authority) to
own its assets, to carry on its business as currently conducted and to
consummate the transactions contemplated in, and to perform its obligations
under, this Agreement and the other Transaction Documents to which it is party
or by which it is bound.
(b) XOMA has
no Indebtedness other than its obligations under or in respect of Article
XII.
(c) XOMA
makes to the Lender the representations and warranties set forth in Sections
8.01(b) through (f) and Sections 8.01(q) and (r), in each case, replacing each
reference to “the Borrower” with a reference to “XOMA”.
All
representations and warranties of XOMA contained in this Agreement shall survive
the execution, delivery and acceptance thereof by the Parties and the closing of
the transactions described in this Agreement.
SECTION
12.07. Covenants of
XOMA.
(a) XOMA
covenants that there shall be no change to the business and activities of XOMA
or any of its Subsidiaries from the business and activities in which each such
entity is engaged on the date of this Agreement that has or could reasonably be
expected to have a Material Adverse Effect with respect to the Borrower or XOMA
(in the case of XOMA, replacing in the definition of Material Adverse Effect
each reference to “the Borrower” with a reference to “XOMA”).
(b) Except as
otherwise provided in Section 10.06, XOMA shall not, directly or indirectly,
incur or suffer to exist any Indebtedness of XOMA or any of its Subsidiaries
unless such Indebtedness is both (i) expressly and fully subordinated (including
in right of payment and the exercise of remedies) to the Loan and to XOMA’s
obligations in respect of its guarantee under this Article XII and (ii) not
required to be repaid prior to the date that is five years and ninety-five days
following the Closing Date. Notwithstanding the foregoing, XOMA may
(x) guarantee Indebtedness of the Borrower that either is permitted under
Section 10.06(c) or is secured by a Lien permitted under Section 10.03(d); and
(y) issue from time to time Permitted Convertible Securities; provided, in the case
of (y), that the aggregate principal amount outstanding of such Permitted
Convertible Securities does not exceed $75,000,000; and provided further, in the case
of (x) and (y), that prior to entering into any such guarantee or offering any
such Permitted Convertible Securities, XOMA shall have caused each of XOMA’s
Subsidiaries other than the Borrower: (1) to have guaranteed the Guaranteed
Obligations on terms satisfactory in form and substance to the Lender (each, a
“Subsidiary
Guarantee”) and (2) to have provided an undertaking in favor of the
Lender that such Subsidiary will not, directly or indirectly, incur or suffer to
exist any Indebtedness unless such Indebtedness is expressly and fully
subordinated
(including
in right of payment and the exercise of remedies) to its obligations in respect
of its Subsidiary Guarantee.
ARTICLE
XIII
INDEMNIFICATION
SECTION
13.01. Funding
Losses. If
the Borrower makes any payment of principal with respect to the Loan on any day
other than the last day of an Interest Period applicable thereto, or if the
Borrower fails to borrow any amount on the Closing Date after Notice of
Borrowing has been given to the Lender in accordance with Section 2.02, the
Borrower shall reimburse the Lender within three Banking Days after demand for
any resulting loss or expense incurred by the Lender including any loss incurred
in obtaining, liquidating or redeploying deposits from third parties; provided that the
Lender shall have delivered to the Borrower a certificate as to the amount of
such loss or expense.
SECTION
13.02. Increased
Costs. Except
as to Taxes (it being understood that the Borrower’s liability for Taxes will be
exclusively determined under Article V), the Borrower shall reimburse the Lender
on demand for all increases in costs incurred by the Lender and all reductions
in amounts received or receivable by the Lender or in the rate of return on the
Lender’s capital, as reasonably determined by the Lender, that are attributable
to the Loan or the performance by the Lender of its obligations under this
Agreement and that occur by reason of the promulgation after the date hereof of
any Law or treaty or any change after the date hereof in any Law or treaty or in
the interpretation thereof or by reason of compliance by the Lender with any
direction, requirement or request (whether or not having the force of Law) of
any Governmental Authority, including any such cost or reduction resulting from
the imposition or amendment of any capital adequacy requirement or any reserve,
special deposit or similar requirement against assets of, liabilities of,
deposits with or for the account of, or loans by, the Lender; provided that the
Lender shall not be entitled to be reimbursed for such increased costs or
reductions in amount receivable or the rate of return incurred more than 180
days prior to the date on which it gives notice to the Borrower of such
increased costs or reduction in amount receivable or rate of
return.
SECTION
13.03. Other
Losses.
(a) The
Borrower agrees to defend (subject to Indemnitees’ selection of counsel),
indemnify, pay and hold harmless, the Lender and its Affiliates and their
respective officers, partners, directors, trustees, employees and agents (each,
an “Indemnitee”), from
and against any and all Indemnified Liabilities, in all cases, whether or not
caused by or arising, in whole or in part, out of the comparative, contributory
or sole negligence of such Indemnitee; provided, the
Borrower shall not have any obligation to any Indemnitee hereunder with respect
to any Indemnified Liabilities to the extent such Indemnified Liabilities arise
from the gross negligence or willful misconduct of such
Indemnitee. To the extent that the undertakings to defend, indemnify,
pay and hold harmless set forth in this Section 13.03 may be unenforceable in
whole or in part because they are violative of any law or public policy, the
Borrower shall contribute the maximum portion that it is permitted to pay and
satisfy under applicable law to the payment and satisfaction of all Indemnified
Liabilities incurred by Indemnitees or any of them.
(b) To the
extent permitted by applicable law, no Party shall assert, and each Party hereby
waives, any claim against each other Party and such Party’s Affiliates,
directors, employees, attorneys or agents, on any theory of liability, for
special, indirect, consequential or punitive damages (as opposed to
direct or actual damages) (whether or not the claim therefor is based on
contract, tort or duty imposed by any applicable legal requirement) arising out
of, in connection with, as a result of, or in any way related to, this Agreement
or any Loan Document or any agreement or instrument contemplated hereby or
thereby or referred to herein or therein, the transactions contemplated hereby
or thereby, the Loan or the use of the proceeds thereof or any act or omission
or event occurring in connection therewith, and each Party hereby waives,
releases and agrees not to sue upon any such claim or any such damages, whether
or not accrued and whether or not known or suspected to exist in its
favor.
SECTION
13.04. Assumption of Defense;
Settlements. If
the Lender is entitled to indemnification under this Article XIII with respect
to any action or proceeding brought by a third party that is also brought
against the Borrower, the Borrower shall be entitled to assume the defense of
any such action or proceeding with counsel reasonably satisfactory to the
Lender. Upon assumption by the Borrower of the defense of any such
action or proceeding, the Borrower shall have the right to participate in such
action or proceeding and to retain its own counsel but the Borrower shall not be
liable for any legal expenses of other counsel subsequently incurred by the
Lender in connection with the defense thereof unless (i) the Borrower has
otherwise agreed to pay such fees and expenses, (ii) the Borrower shall
have failed to employ counsel reasonably satisfactory to the Lender in a timely
manner or (iii) the Lender shall have been advised by counsel that there
are actual or potential conflicting interests between the Borrower and the
Lender, including situations in which there are one or more legal defenses
available to the Lender that are different from or additional to those available
to the Borrower; provided, however, that the
Borrower shall not, in connection with any one such action or proceeding or
separate but substantially similar actions or proceedings arising out of the
same general allegations, be liable for the fees and expenses of more than one
separate firm of attorneys at any time for the Lender, except to the extent that
local counsel, in addition to its regular counsel, is required in order to
effectively defend against such action or proceeding. The Borrower
shall not consent to the terms of any compromise or settlement of any action
defended by the Borrower in accordance with the foregoing without the prior
written consent of the Lender unless such compromise or settlement (x) includes
an unconditional release of the Lender from all liability arising out of such
action and (y) does not include a statement as to or an admission of fault,
culpability or a failure to act, by or on behalf of the Lender. The
Borrower shall not be required to indemnify the Lender for any amount paid or
payable by the Lender in the settlement of any action, proceeding or
investigation without the written consent of the Borrower, which consent shall
not be unreasonably withheld.
ARTICLE
XIV
MISCELLANEOUS
SECTION
14.01. Assignments.
(a) The
Borrower shall not be permitted to assign this Agreement without the prior
written consent of the Lender and any purported assignment in violation of this
Section 14.01(a) shall be null and void.
(b) The
Lender may at any time assign all its rights and obligations hereunder in whole
or in part to a financial institution, institutional investor or commercial
paper conduit (each, an “Assignee”); provided that, at any
time, there shall be no more than three Lenders.
(c) The
parties to each assignment shall execute and deliver to the Borrower a written
instrument of assignment in the form set forth in Exhibit G,
containing the agreement of the assignee to be bound by the terms of this
Agreement (an “Assignment and
Acceptance”). Upon the effectiveness of a permitted assignment hereunder,
(i) each reference in this Agreement to “Lender” shall be deemed to be a
reference to the assignor and the assignee to the extent of their respective
interests, (ii) such assignee shall be a Lender party to this Agreement and
shall have all the rights and obligations of a Lender and (iii) the assignor
shall be released from its obligations hereunder to a corresponding extent of
the assignment, and no further consent or action by any party shall be
required.
(d) In the
event there are multiple Lenders, all payments of principal, interest, fees and
any other amounts payable pursuant to the Loan Documents shall be allocated on a
pro rata basis among
the Lenders according to their proportionate interests in the Loan.
(e) The
Borrower shall, from time to time at the request of the Lender, execute and
deliver any documents that are necessary to give full force and effect to an
assignment permitted hereunder, including a new Note in exchange for the Note
held by the Lender.
(f) Except in
the case of an assignment to a Lender or an Affiliate of a Lender or an
assignment of the entire remaining amount of the assigning Lender’s Loan, the
amount of the Loan of the assigning Lender subject to each such assignment
(determined as of the date the Assignment and Acceptance with respect to such
assignment is delivered to the Borrower) shall not be less than $5,000,000
unless the Borrower otherwise consents, provided that no such consent of the
Borrower shall be required if a Default has occurred and is
continuing.
SECTION
14.02. Participations. The
Lender may at any time grant to one or more financial institutions,
institutional investors and/or commercial paper conduits (each, a “Participant”)
participating interests in its Loan. In the event of any such grant
by the Lender of a participating interest to a Participant, whether or not upon
notice to the Borrower, such Lender shall remain responsible for the performance
of its obligations hereunder, and the Borrower shall continue to deal solely and
directly with the Lender in connection with the Lender’s rights and obligations
under this Agreement. Any agreement pursuant to which the Lender may
grant such a participating interest shall provide that the Lender shall retain
the sole right and responsibility to enforce the obligations of the Borrower
hereunder including the right to approve any amendment, modification or waiver
of any provision of this Agreement. No Participant shall have any
rights as a Lender hereunder, including any right to make any demand hereunder
or right to approve any amendment or waiver of any provision of this Agreement,
or any consent to any departure by the Borrower therefrom, except to the extent
that such amendment, waiver or consent would reduce the principal of, or
interest on, the Loan or any fees or other amounts payable hereunder, in each
case to the extent subject to such participation, or postpone any date fixed for
any payment of principal of, or interest on, the Loan or any fees or other
amounts payable hereunder or release, reduce or otherwise limit the obligations
of XOMA under Article XII or amend this Section 14.02 in any manner adverse to
such Participant, in each case, to the extent subject
to such
participation. The Borrower agrees that each Participant shall, to
the extent provided in its participation agreement, be entitled to the benefits
of Articles V, XII and XIII with respect to its participating interest, as
though it were a Lender; provided, however, a
Participant shall not be entitled to receive any greater payment under Articles
V and XIII than the applicable Lender would have been entitled to receive with
respect to the participation sold to such Participant, unless the sale of the
participation to such Participant is made with the Borrower's written consent
(not to be unreasonably withheld).
SECTION
14.03. Successors and
Assigns. This
Agreement shall be binding upon and inure to the benefit of the Parties and
their respective successors and permitted assigns.
SECTION
14.04. Notices. All
notices, consents, approvals, reports, designations, requests, waivers,
elections and other communications (collectively, “Notices”) authorized
or required to be given pursuant to this Agreement shall be given in writing and
either personally delivered to the Party to whom it is given or delivered by an
established delivery service by which receipts are given or mailed by registered
or certified mail, postage prepaid, or sent by facsimile or electronic mail with
a copy sent on the following Banking Day by one of the other methods of giving
notice described herein, addressed to the Party at its address listed
below:
|
If
to the Borrower:
|
|
|
|
XOMA
(US) LLC
|
|
|
2910
Seventh Street
|
|
|
Berkeley,
California 94710
|
|
|
Attn: Legal
Department
|
|
|
with
a copy, which shall not constitute notice, to:
|
|
|
|
|
|
XOMA
(US) LLC
|
|
|
2910
Seventh Street
|
|
|
Berkeley,
California 94710
|
|
|
Attn: Finance
Department
|
|
|
and
a copy, which shall not constitute notice, to:
|
|
|
|
|
|
Cahill
Gordon & Reindel llp
|
|
|
80
Pine Street
|
|
|
New
York, New York 10005
|
|
|
Attn: Geoffrey
Liebmann
|
|
|
|
|
If
to the Lender:
|
|
|
|
Goldman
Sachs Specialty Lending Holdings, Inc.
|
|
|
85
Broad Street
|
|
|
New
York, New York 10004
|
|
|
Attention: Nicholas
Heilbut
|
|
|
|
|
|
with
a copy to:
|
|
|
Goldman
Sachs Specialty Lending Holdings, Inc.
|
|
|
600
E. Las Colinas Boulevard
|
|
|
Suite
400
|
|
|
Irving,
Texas 75039
|
|
|
Attention: Kyle
Volluz
|
|
|
|
|
|
If
to XOMA:
|
|
|
|
|
|
XOMA
Ltd.
|
|
|
2910
Seventh Street
|
|
|
Berkeley,
California 94710
|
|
|
Attn: Legal
Department
|
|
|
|
|
|
with
a copy, which shall not constitute notice, to:
|
|
|
|
|
|
XOMA
Ltd.
|
|
|
2910
Seventh Street
|
|
|
Berkeley,
California 94710
|
|
|
Attn: Finance
Department
|
|
|
|
|
|
and
a copy, which shall not constitute notice, to:
|
|
|
|
|
|
Cahill
Gordon & Reindel llp
|
|
|
80
Pine Street
|
|
|
New
York, New York 10005
|
|
|
Attn: Geoffrey
Liebmann
|
Any Party
may change its address for the receipt of Notices at any time by giving Notice
thereof to the other Parties. Except as otherwise provided herein,
any Notice authorized or required to be given by this Agreement shall be
effective when received.
SECTION
14.05. Entire
Agreement. This
Agreement and the other Transactilon Documents contain the entire agreement
between the Parties relating to the subject matter hereof and supersede all oral
statements and prior writings with respect thereto.
SECTION
14.06. Modification. No
Loan Document or provision thereof may be waived, amended or modified except, in
the case of this Agreement, by an agreement or agreements in writing executed by
the Borrower and the Required Lenders or, in the case of any other Loan
Document, by an agreement or agreements in writing entered into by the parties
thereto with the consent of the Required Lenders; provided that no such
agreement shall:
(i) increase
the Commitment of any Lender, reduce the principal amount of the Loan or reduce
the rate of interest thereon, or reduce any fees or other amounts payable
hereunder, without the written consent of each Lender affected
thereby;
(ii) postpone
the scheduled date of payment of the principal amount of the Loan, or any
interest thereon, or any fees or other amounts payable hereunder, or
reduce
the
amount of, waive or excuse any such payment, without the written consent of each
Lender affected thereby;
(iii) release
all or substantially all of the Collateral from the Security Interest (as
defined in the Security Agreement) or release the Guarantor from its obligations
under Article XII without the written consent of each Lender; or
(iv) change
any of the provisions of this Section 14.06 or the definition of “Required
Lenders” without the written consent of each Lender.
Notwithstanding
anything to the contrary herein or in any Loan Document, in the event there are
multiple Lenders, the Lender may amend or modify the Loan Documents without the
Borrower’s consent; provided that such
amendment or modification is solely to provide for appropriate intercreditor
arrangements and provided, further, that such
amendment or modification does not affect the rights of the Borrower hereunder
or under any Loan Document.
SECTION
14.07. No Delay; Waivers;
etc. No
delay on the part of the Lender in exercising any power or right hereunder shall
operate as a waiver thereof nor shall any single or partial exercise of any
power or right hereunder preclude other or further exercise thereof or the
exercise of any other power or right. The Lender shall not be deemed
to have waived any rights hereunder unless such waiver shall be in writing and
signed by the Lender.
SECTION
14.08. Severability. If
any provision of this Agreement shall be held to be invalid, illegal or
unenforceable, then, to the fullest extent permitted by law, the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
SECTION
14.09. Determinations. Each
determination or calculation by the Lender hereunder shall, in the absence of
manifest error, be conclusive and binding on the Parties.
SECTION
14.10. Replacement of
Note Upon
the loss, theft, destruction, or mutilation of the Note and (a) in the case of
loss, theft or destruction, upon receipt by the Borrower of indemnity or
security reasonably satisfactory to it (except that if the holder of the Note is
the Lender or any other financial institution of recognized responsibility, the
holder’s own agreement of indemnity shall be deemed to be satisfactory) or (b)
in the case of mutilation, upon surrender to the Borrower of the mutilated Note,
the Borrower shall execute and deliver in lieu thereof a new Note, dated the
Closing Date, in the same principal amount.
SECTION
14.11. Governing
Law. THIS
AGREEMENT AND THE NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO ANY CONFLICT OF LAWS
PRINCIPLES THAT WOULD REQUIRE APPLICATION OF THE LAWS OF ANOTHER
JURISDICTION).
SECTION
14.12. Jurisdiction. Each
of the Borrower and XOMA irrevocably submits to the jurisdiction of the courts
of the State of New York and of the United States sitting in the State of New
York, and of the courts of its own corporate domicile with respect to
actions
or
proceedings brought against it as a defendant, for purposes of all legal
proceedings arising out of or relating to this Agreement or the transactions
contemplated hereby (a “Proceeding”). Each
of the Borrower and XOMA irrevocably waives, to the fullest extent
permitted by law, any objection which it may now or hereafter have to the laying
of venue of any Proceeding and any claim that any Proceeding has been brought in
an inconvenient forum. Any process or summons for purposes of any
Proceeding may be served on the Borrower or XOMA by mailing a copy thereof by
registered mail, or a form of mail substantially equivalent thereto, addressed
to it at its address as provided for Notices hereunder.
SECTION
14.13. Waiver of Jury
Trial. EACH
OF THE BORROWER AND XOMA HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY
JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
SECTION
14.14. Waiver of
Immunity. To
the extent that the Borrower or XOMA has or hereafter may be entitled to claim
or may acquire, for itself or any of its assets, any immunity from suit,
jurisdiction of any court or from any legal process (whether through service or
notice, attachment prior to judgment, attachment in aid of execution, or
otherwise) with respect to itself or any of its property, each of the Borrower
and XOMA hereby irrevocably waives such immunity in respect of its obligations
hereunder and under the Note to the fullest extent permitted by
law.
SECTION
14.15. Counterparts. This
Agreement may be executed in any number of counterparts, each of which shall be
deemed an original, but all of which shall constitute one and the same
instrument.
SECTION
14.16. Limitation on Rights of
Others. Except
for the Indemnitees referred to in Section 13.03 or as provided in Section
14.02, no Person other than a Party shall have any legal or equitable right,
remedy or claim under or in respect of this Agreement.
SECTION
14.17. No
Partnership. Nothing
in this Agreement or any other Transaction Document shall be read to create any
agency, partnership or joint venture of the Lender (or any of its Affiliates)
and the Borrower (or any of its Affiliates).
SECTION
14.18. Survival. The
obligations of the Borrower contained in Sections 4.05, 4.06, Article V and
Article XIII and of XOMA contained in Article XII shall survive the repayment of
the Loan and the cancellation of the Note and the termination of the other
obligations of the Borrower hereunder.
SECTION
14.19. Patriot Act
Notification. The
Lender hereby notifies the Borrower that, consistent with the USA Patriot Act,
Public Law No. 107-56 (the “Patriot Act”),
regulations promulgated thereunder and under other applicable Law, the Lender’s
procedures and customer due diligence standards require it to obtain, verify and
record information that identifies the Borrower, including among other things
name, address, information regarding persons with authority or control over the
Borrower, and other information regarding the Borrower, its operations and
transactions with the Lender. The Borrower agrees to provide such
informa-
tion and
take such actions as are reasonably requested by the Lender in order to assist
the Lender in maintaining compliance with its procedures, the Patriot Act and
any other applicable Laws.
IN
WITNESS WHEREOF, the Parties have duly executed this Agreement as of the day and
year first above written.
|
GOLDMAN
SACHS SPECIALTY LENDING HOLDINGS, INC.,
as
Lender
By: ________________________________
|
|
Name:
Title:
|
|
|
|
XOMA
(US) LLC,
as
Borrower
By: ________________________________
|
|
Name:
Title:
|
|
|
|
XOMA
LTD.,
as
Guarantor
By: ________________________________
Name:
Title:
|
EXHIBIT
A
Form of Promissory
Note
|
US$55,000,000
|
New
York, New York
|
|
|
May
___, 2008
|
|
|
|
|
|
|
FOR VALUE
RECEIVED, XOMA (US) LLC, a Delaware limited liability company (the “Borrower”), hereby
promises to pay to the order of Goldman Sachs Specialty Lending Holdings, Inc.
or its registered assigns (the “Lender”), in lawful
money of the United States of America, in same day funds on the Maturity Date
the principal sum of fifty-five million dollars (US$55,000,000).
The
Borrower also promises to pay interest on the unpaid principal amount hereof in
like money, from the date hereof until such unpaid principal is paid in full, at
the rates, at the times and in the manner provided in the Amended and Restated
Loan Agreement referred to below.
This Note
is the Note referred to in the Amended and Restated Loan Agreement, dated as of
May 9, 2008 between the Borrower and the Lender (as amended from time to time,
the “Loan
Agreement”) and is entitled to the benefits thereof and of the other Loan
Documents. This Note is secured as provided in the Loan
Documents. This Note is subject to optional prepayment, in whole or
in part, prior to the Maturity Date as provided in the Loan
Agreement.
If an
Event of Default shall occur and be continuing, the principal of and accrued
interest on this Note may become or be declared to be due and payable in the
manner and with the effect provided in the Loan Agreement.
The
Borrower hereby waives presentment, demand, protest or notice of any kind in
connection with this Note.
Capitalized
terms used but not defined herein shall have the meanings given to them in the
Loan Agreement.
THIS
NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF THE
STATE OF NEW YORK (WITHOUT GIVING EFFECT TO ANY CONFLICT OF LAWS PRINCIPLES THAT
WOULD REQUIRE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION).
|
XOMA
(US) LLC
By: __________________________________
Name:
Title:
|
EXHIBIT
B
Form of Notice of
Borrowing
XOMA (US)
LLC
2910
Seventh Street
Berkeley,
California 94710
May ___,
2008
Goldman
Sachs Specialty Lending Holdings, Inc.
85 Broad
Street
New York,
New York 10004
Attention: James
David
Ladies
and Gentlemen:
The
undersigned (the “Borrower”) refers to
the Amended and Restated Loan Agreement, dated as of May 9, 2008 (as amended
from time to time, the “Loan Agreement”),
between the Borrower and Goldman Sachs Specialty Lending Holdings, Inc. (the
“Lender”). Capitalized
terms used but not defined herein shall have the meanings given to them in the
Loan Agreement.
The
Borrower hereby gives you irrevocable notice, pursuant to Section 2.02 of the
Loan Agreement, that it hereby requests to borrow an amount equal to the
Commitment (the “Borrowing”), on May
9, 2008 (the “Closing
Date”), in accordance with the terms of the Loan Agreement.
The bank
and account to which the proceeds payable to the Borrower pursuant to Section
2.03 (after giving effect to clauses (i)-(iv) thereof) should be sent
are:
|
Beneficiary
Bank ABA #
|
121000248
|
|
Beneficiary
Bank Name
|
Wells
Fargo Bank
|
|
|
One
Kaiser Plaza, Suite 850
Oakland,
CA 94612
|
|
Contact
Name
|
Naomi
S. Fukumori
|
|
|
510-464-1937
|
|
Beneficiary
Name
|
XOMA
(US) LLC
|
|
Beneficiary
Account #
|
4375-679073
|
|
|
|
The
undersigned hereby certifies that the following statements are true on the date
hereof, and will be true on the Closing Date:
(A) the
representations and warranties contained in the Loan Agreement and in the other
Transaction Documents are and will be true and correct, both before and after
giving effect to the Borrowing and to the application of the proceeds thereof,
as though made on such date;
(B) no
Default or Event of Default has occurred and is continuing, or would result from
such Borrowing or from the application of the proceeds thereof; and
(C) all
of the conditions set forth in Section 7.01 of the Loan Agreement have been
satisfied.
|
Very
truly yours,
XOMA
(US) LLC
By: ________________________________
|
|
Name:
Title:
|
EXHIBIT
C
Form of Security Agreement
Amendment
EXHIBIT
D-1
Form of Certificate of the
Borrower
The
undersigned authorized officer of XOMA (US) LLC, a limited liability
company organized
and existing under the laws of the State of Delaware (the “Borrower”), does
hereby certify on behalf of the Borrower that:
1. This
certificate is furnished pursuant to Section 7.01(b)(i) of the Amended and
Restated Loan Agreement, dated as of May 9, 2008, between the Borrower and
Goldman Sachs Specialty Lending Holdings, Inc. (such Loan Agreement as in effect
on the date of this Certificate, the “Loan
Agreement”). Capitalized terms used but not defined in this
certificate shall have the meanings given in the Loan Agreement.
2. Each
of the named individuals listed on Annex A hereto is duly authorized to sign
documents and otherwise act on behalf of the Borrower. The signature written
opposite the name and title of each such person is his/her genuine
signature.
3. Attached
hereto as Annex B is a certified copy of the Certificate of Formation of the
Borrower, as filed in the Office of the Secretary of State of the State of
Delaware on February 9, 1999, together with all amendments thereto adopted
through the date hereof.
4. Attached
hereto as Annex C is a Certificate of Good Standing of the Borrower signed by
the Secretary of State of the State of Delaware and dated May 7,
2008.
5. Attached
hereto as Annex D is a true and correct copy of the unanimous written consent of
the board of directors of the Borrower authorizing the Borrower to execute and
deliver the Transaction Documents that are dated on or about the date hereof and
enter into the transactions contemplated in such Transaction Documents, which
unanimous written consent was duly adopted on May 7, 2008 and said unanimous
written consent has not been rescinded, amended or modified.
6. Attached
hereto as Annex E is a true and correct copy of resolutions of the board of
directors of the Borrower authorizing the Borrower to execute and deliver the
Transaction Documents that are dated on or about November 9, 2006 and enter into
the transactions contemplated in such Transaction Documents, which resolutions
were duly adopted on November 8, 2006, and said resolutions have not been
rescinded, amended or modified.
7. Attached
hereto as Annex F are true and correct copies of the License Agreements and all
amendments, supplements and other modifications thereto, executed by the parties
thereto.
8. Attached
hereto as Annex G is a true and correct copy of the Acquisition Agreement,
executed by the parties thereto, and no provision of said Acquisition Agreement
has been waived, amended, supplemented or otherwise modified.
9. No
event has occurred and is continuing that constitutes a Default or an Event of
Default and no such event will occur or will have occurred by reason of the
Loan.
10. The
representations and warranties made by the Borrower in Article VIII of the Loan
Agreement and in the other Transaction Documents are true and correct and will
be true after giving effect to the Loan.
11. The
Transaction Documents are in full force and effect.
IN
WITNESS WHEREOF, I have hereunto set my hand this ____ day of May
2008.
|
XOMA
(US) LLC
By: _________________________________
|
|
Name: Christopher
J. Margolin
Title: Vice
President, General Counsel
and
Secretary
|
Annex A -
Incumbency
|
Name
|
Title
|
Signature
|
|
J.
David Boyle II
|
Vice
President, Finance and Chief Financial Officer
|
______________________
|
|
Christopher
J. Margolin, Esq.
|
Vice
President, General Counsel and Secretary
|
______________________
|
Annex B – Certified Copy of
the Certificate of Formation of the Borrower
Annex C – Certificate of
Good Standing of the Borrower
Annex D –Unanimous Written
Consent of the
Board of Directors of the
Borrower, adopted on May 7,
2008
Annex E – Resolutions of
the
Board of Directors of the
Borrower, adopted on November 8, 2006
Annex F – License
Agreements
Annex G – Acquisition
Agreement
EXHIBIT
D-2
Form of Certificate of
XOMA
The
undersigned authorized officer of XOMA Ltd., a company continued and existing
under the laws of Bermuda (“XOMA”), does hereby
certify on behalf of XOMA that:
1. This
certificate is furnished pursuant to Section 7.01(b)(ii) of the Amended and
Restated Loan Agreement, dated as of May 9, 2008, between the Borrower and
Goldman Sachs Specialty Lending Holdings, Inc. (such Loan Agreement as in effect
on the date of this Certificate, the “Loan
Agreement”). Capitalized terms used but not defined in this
certificate shall have the meanings given in the Loan Agreement.
2. Each
of the named individuals listed on Annex A hereto is duly authorized to sign
documents and otherwise act on behalf of XOMA. The signature written opposite
the name and title of each such person is his/her genuine
signature.
3. Attached
hereto as Annex B is a certified copy of the Memorandum of Continuance of XOMA,
as filed in with the Bermuda Registrar of Companies on December 29, 1998,
together with all amendments thereto adopted through the date
hereof.
4. Attached
hereto as Annex C is a Certificate of Compliance of XOMA issued by or on behalf
of the Bermuda Registrar of Companies on May 8, 2008.
5. Attached
hereto as Annex D is a true and correct copy of resolutions of the board of
directors authorizing XOMA, and to cause XOMA (US) LLC and XOMA (Bermuda) Ltd.
to, execute and deliver the Transaction Documents that are dated on or about
November 9, 2006 to which it is party and enter into the transactions
contemplated in such Transaction Documents, which resolutions were duly adopted
on November 8, 2006, and said resolutions have not been rescinded, amended or
modified.
6. Attached
hereto as Annex E is a true and correct copy of resolutions of the board of
directors authorizing XOMA, and to cause XOMA (US) LLC and XOMA (Bermuda) Ltd.
to, execute and deliver the Transaction Documents that are dated on or about the
date hereof to which it is party and enter into the transactions contemplated in
such Transaction Documents, which resolutions were duly adopted on May 5, 2008,
and said resolutions have not been rescinded, amended or modified.
7. No
event has occurred and is continuing that constitutes a Default or an Event of
Default and no such event will occur or will have occurred by reason of the
Loan.
8. The
representations and warranties made by XOMA in the Transaction Documents to
which it is party are true and correct and will be true after giving effect to
the Loan.
9. The
Transaction Documents are in full force and effect.
IN
WITNESS WHEREOF, I have hereunto set my hand this ____ day of May
2008.
|
XOMA
LTD.
By: ________________________________
|
|
Name: Christopher
J. Margolin
Title: Vice
President, General Counsel
and
Secretary
|
Annex A -
Incumbency
|
Name
|
Title
|
Signature
|
|
J.
David Boyle II
|
Vice
President, Finance and Chief Financial Officer
|
______________________
|
|
Christopher
J. Margolin, Esq.
|
Vice
President, General Counsel and Secretary
|
______________________
|
Annex B – Certified Copy of
the Memorandum of Continuance of XOMA
Annex C – Certificate of Compliance of
XOMA
Annex D – Resolutions of
the
Board of Directors of
XOMA, adopted on November 8, 2006
Annex E – Resolutions of the
Board of
Directors of XOMA, adopted
on May 5, 2008
EXHIBIT
E
Existing Liens and Related
Indebtedness
[*]
EXHIBIT
F
Revenue
Milestones
|
·
|
Net
sales of RAPTIVA®
in [*] in any [*] shall be equal to or greater than [*] of the net sales
of RAPTIVA®
in [*] in the [*].
|
|
·
|
Net
sales of RAPTIVA®
[*] in any [*] shall be equal to or greater than [*] of the net sales of
RAPTIVA®
outside of [*] in the [*].
|
|
·
|
Net
sales of LUCENTIS™
in [*] in any [*] shall be equal to or greater than [*] of the net sales
of LUCENTIS™
in [*] in the [*].
|
EXHIBIT
G
Form of Assignment and
Acceptance
[date]
Goldman
Sachs Specialty Lending Holdings, Inc.
85 Broad
Street
New York,
New York 10004
Attention: [ ]
Facsimile: [ ]
XOMA (US)
LLC
2910
Seventh Street
Berkeley,
California 94710
Attention: [ ]
Facsimile: [ ]
Ladies
and Gentlemen:
Re:
Assignment Pursuant to the Amended and Restated Loan Agreement
We refer
to the Amended and Restated Loan Agreement dated as of May 9, 2008 (as amended
from time to time, the “Agreement”), providing for a
loan to XOMA (US) LLC in an aggregate principal amount of up to
$55,000,000. _______ (the “Seller”) and _______ (the
“Buyer”) are delivering
this instrument to you in connection with an assignment by the Seller of its
rights and obligations under the Agreement pursuant to Section 13.01
thereof. Capitalized terms used and not otherwise defined herein have the
meanings given to them in the Agreement.
1. The
Seller and the Buyer hereby advise you (a) that the Seller will assign to the
Buyer the Seller’s right, title and interest in respect of the Agreement
described below as the “Assigned Rights” and the
Buyer will accept that assignment and assume the Seller’s related obligations
described below as the “Assumed Obligations,” and (b)
that as between the Seller and the Buyer that assignment and assumption will be
effective as of the date identified below as the “Effective Date.”
2. In
connection with the assignment referred to herein, the Buyer hereby confirms to
you that (a) the Buyer is a financial institution, institutional investor or
commercial paper conduit and (b) the Buyer agrees to be bound as a Lender by the
terms of the Agreement to the extent of the assignment and assumption referred
to herein.
Terms Relating to the
Assignment and Acceptance
Effective
Date:
Assigned
Rights:
A ___%
undivided interest in (i) the Loan of the Seller outstanding on the Effective
Date, (ii) all related rights of the Seller to interest accruing on such portion
of the Loan from and after the Effective Date, and (iii) all related rights of
the Seller under the Agreement and the Note delivered to the Seller thereunder
from and after the Effective Date.
Assumed
Obligations:
All
obligations of the Seller relating to the Assigned Rights that arise under the
Agreement on or after the Effective Date
Loan
of the Seller:
Before
the Effective Date: $______________
After
giving effect to the assignment referred to herein: $______________
Loan
of the Buyer:
Before
the Effective Date: $______________
After
giving effect to the assignment referred to herein: $______________
For these
purposes, the Buyer hereby informs you that the address for notices and account
for payments of its Lending Office in connection with the Agreement are as set
forth below.
|
GOLDMAN
SACHS SPECIALTY LENDING HOLDINGS, INC.
|
___________________
|
|
By: _______________________________
|
By: _______________________________
|
|
Name:
_____________________________
|
Name: ______________________________
|
|
Title: _______________________________
|
Title: _____________________________
|
|
|
[Include
Notice and account information for Buyer.]
|
|
By: _______________________________
|
|
|
Name: _____________________________
|
|
|
Title: _______________________________
|
|
EXHIBIT
H-1
[*]
EXHIBIT
H-2
[*]
EXHIBIT
I
Form of XOMA Bermuda
Representation Letter
EXHIBIT
J
XOMA BCE/HE Intellectual
Property
XOMA Patent Rights –
Bacterial Expression
A. Title: Modular
Assembly of Antibody Genes, Antibodies Prepared Thereby and Use
Based on
PCT/US88/02514, which corresponds to U.S. Application No. 07/077,528, which is a
continuation-in-part PCT/US86/02269 (abandoned), which is a continuation-in-part
of U.S. Application No. 06/793,980 (abandoned).
|
COUNTRY
|
APPLICATION NO.
|
PATENT NO.
|
|
|
Australia
|
23244/88
|
632,462
|
|
|
Canada
|
572,398
|
1,341,235
|
|
|
Denmark
|
192/90
|
174824
|
|
|
Denmark
|
200301155
|
175654
B1
|
|
|
Denmark
|
200301156
|
175581
B1
|
|
|
Europe
|
EP
88907510.7
|
EP
0371998
|
|
|
Austria
|
EP
88907510.7
|
EP
0371998
|
|
|
Belgium
|
EP
88907510.7
|
EP
0371998
|
|
|
France
|
EP
88907510.7
|
EP
0371998
|
|
|
Germany
|
EP
88907510.7
|
DE
3888186.1
|
|
|
Italy
|
EP
88907510.7
|
EP
0371998
|
|
|
Luxembourg
|
EP
88907510.7
|
EP
0371998
|
|
|
Netherlands
|
EP
88907510.7
|
EP
0371998
|
|
|
Sweden
|
EP
88907510.7
|
EP
0371998
|
|
|
Switzerland/
Liechtenstein
|
EP
88907510.7
|
EP
0371998
|
|
|
United Kingdom
|
EP
88907510.7
|
EP
0371998
|
|
|
Europe
|
EP
93100041.8
|
EP
0550400
|
|
|
Austria
|
EP
93100041.8
|
EP
0550400
|
|
|
Belgium
|
EP
93100041.8
|
EP
0550400
|
|
|
France
|
EP
93100041.8
|
EP
0550400
|
|
|
Germany
|
EP
93100041.8
|
DE
3855421.6
|
|
|
Italy
|
EP
93100041.8
|
EP
0550400
|
|
|
Luxembourg
|
EP
93100041.8
|
EP
0550400
|
|
|
Netherlands
|
EP
93100041.8
|
EP
0550400
|
|
|
Sweden
|
EP
93100041.8
|
EP
0550400
|
|
|
Switzerland/
Liechtenstein
|
EP
93100041.8
|
EP
0550400
|
|
|
United Kingdom
|
EP
93100041.8
|
EP
0550400
|
|
|
Europe
|
EP
95119798.7
|
EP
0731167
|
|
Austria
|
EP
95119798.7
|
EP
0731167
|
|
Belgium
|
EP
95119798.7
|
EP
0731167
|
|
France
|
EP
95119798.7
|
EP
0731167
|
|
Germany
|
EP
95119798.7
|
DE
3856440.8
|
|
Italy
|
EP
95119798.7
|
EP
0731167
|
|
Luxembourg
|
EP
95119798.7
|
EP
0731167
|
|
Netherlands
|
EP
95119798.7
|
EP
0731167
|
|
Sweden
|
EP
95119798.7
|
EP
0731167
|
|
Switzerland/
Liechtenstein
|
EP
95119798.7
|
EP
0731167
|
|
United Kingdom
|
EP
95119798.7
|
EP
0731167
|
|
Japan
|
506481/88
|
2991720
|
|
|
|
|
Based on
U.S. Application No. 07/501,092 filed March 29, 1990, which is a
continuation-in-part of U.S. Application No. 07/077,528 (Modular Assembly of
Antibody Genes, Antibodies Prepared Thereby and Use; Robinson, Liu, Horwitz,
Wall, Better) and of U.S. Application No. 07/142,039 (Novel Plasmid Vector with
Pectate Lyase Signal Sequence; Lei, Wilcox).
|
COUNTRY
|
APPLICATION NO.
|
PATENT NO.
|
|
United
States
|
08/235,225
|
5,618,920
|
|
United
States
|
08/299,085
|
5,595,898
|
|
United
States
|
08/472,691
|
6,204,023
|
|
United
States
|
08/467,140
|
5,698,435
|
|
United
States
|
08/450,731
|
5,693,493
|
|
United
States
|
08/466,203
|
5,698,417
|
|
United
States
|
11/582,563
|
Abandoned
|
|
|
|
|
B. Title: Novel
Plasmid Vector with Pectate Lyase Signal Sequence (PelB)
Inventors: Lei,
Wilcox
Based on
U.S. Application No. 07/142,039 filed January 11, 1988 and
PCT/US89/00077.
|
COUNTRY
|
APPLICATION NO.
|
PATENT NO.
|
|
Australia
|
29377/89
|
627443
|
|
Canada
|
587,885
|
1,338,807
|
|
Europe
|
EP
89901763.6
|
EP
0396612
|
|
Austria
|
EP
89901763.6
|
EP
0396612
|
|
Belgium
|
EP
89901763.6
|
EP
0396612
|
|
France
|
EP
89901763.6
|
EP
0396612
|
|
Germany
|
EP
89901763.6
|
DE
689 26 882 T2
|
|
Italy
|
EP
89901763.6
|
EP
0396612
|
|
Luxembourg
|
EP
89901763.6
|
EP
0396612
|
|
Netherlands
|
EP
89901763.6
|
EP
0396612
|
|
Sweden
|
EP
89901763.6
|
EP
0396612
|
|
Switzerland/Liechtenstein
|
EP
89901763.6
|
EP
0396612
|
|
United Kingdom
|
EP
89901763.6
|
EP
0396612
|
|
Japan
|
501661/89
|
2980626
|
|
United
States
|
08/472,696
|
5,846,818
|
|
United
States
|
08/357,234
|
5,576,195
|
XOMA Patent Rights – Human
Engineering™
A. Title: Methods and
Materials for Preparation of Modified Antibody Variable Domains
and
Therapeutic Uses Thereof
Inventors: Studnicka,
Little, Fishwild, Kohn
Based on
PCT/US92/10906 [WO 93/11794 filed 12/14/92], which is a continuation-in-part of
U.S. Serial No. 07/808,464 filed December 13, 1991 (abandoned).
|
COUNTRY
|
SERIAL NO.
|
PATENT NO.
|
|
United
States
|
08/107,669
|
5,766,886
|
|
United
States
|
10/340,189
|
Abandoned
|
|
United
States
|
11/133,775
|
Abandoned
|
|
United
States
|
08/082,842
|
5,869,619
|
|
United
States
|
08/472,788
|
5,770,196
|
|
United
States
Canada
|
08/477,531
2,103,887
|
5,821,123
2,103,887
|
|
Canada
|
2,507,749
DIV
|
Pending
|
|
Europe
|
EP
93901238.1
|
EP
0571613
|
|
Belgium
|
EP
93901238.1
|
EP
0571613
|
|
France
|
EP
93901238.1
|
EP
0571613
|
|
Germany
|
EP
93901238.1
|
DE
69233204T
|
|
Ireland
|
EP
93901238.1
|
EP
0571613
|
|
Italy
|
EP
93901238.1
|
EP
0571613
|
|
Netherlands
|
EP
93901238.1
|
EP
0571613
|
|
Spain
|
EP
93901238.1
|
ES
2202310T
|
|
Switzerland/ Liechtenstein
|
EP
93901238.1
|
EP
0571613
|
|
United Kingdom
|
EP
93901238.1
|
EP
0571613
|
|
Japan
|
5-511171
|
Published
6-506362
|
|
Japan
|
2005-6625
|
Published
2005-160485
|
|
Japan
|
2008-113288
|
Pending
|
EXHIBIT
K
Existing Collaboration or
Development Agreements and Related Indebtedness
[*]
K-1