Exhibit 10.11
INTERMUNE PHARMACEUTICALS, INC.
SECURED LOAN AGREEMENT
This SECURED LOAN AGREEMENT is made as of July 1. 1999 by and between
INTERMUNE PHARMACEUTICALS, INC., a California corporation (the "Company") and
W. XXXXX XXXXXXXX ("Borrower").
RECITALS
Borrower desires to borrow, and the Company desires to lend to Borrower
up to an aggregate of $100,000 (the "Borrowed Amount"). The parties desire
that such loan shall be secured pursuant to a Security Agreement of even date
herewith (the "Security Agreement") by an aggregate of 100,000 shares of the
Company's Common Stock (as adjusted for subsequent stock splits, reverse
stock splits and recapitalization) (the "Shares") issuable upon the exercise
of vested options to purchase Common Stock held by Borrower (the "Options")
while any Borrowed Amount is outstanding on the terms and conditions
contained herein and in the Security Agreement.
AGREEMENT
In consideration of the foregoing, and for other good and valuable
consideration, the receipt of which is hereby acknowledged, the parties agree as
follows:
1. AGREEMENT TO LEND. Subject to the terms and conditions contained in
this Agreement and upon execution of this Agreement, the Company agrees to
issue to Borrower a check or other readily available funds in the Borrowed
Amount upon the date of this Agreement.
2. PROMISSORY NOTE. In consideration of the Company's delivery of the
Borrowed Amount, Borrower will execute a secured promissory note in the form
attached hereto as Exhibit A (the "Note"), in the principal amount of such
Borrowed Amount and bearing interest at a rate of 7.5% per annum, compounded
annually.
3. SECURITY AGREEMENT. Borrower will additionally execute the Security
Agreement in the form attached hereto as Exhibit B as security for Borrower's
obligation to repay the Borrowed Amount, and, upon any exercise of the
Options, will deliver, or cause to be delivered, all certificates
representing Shares to the Company or its designee as pledgeholder of the
Shares, together with such other documents of assignment and other documents
as may be reasonably requested by the Company. The Shares will be held by the
Company or its designee as pledgeholder and shall be released in accordance
with the terms of the Security Agreement.
4. NO EMPLOYMENT RIGHTS. Nothing in this Agreement or the Note is
intended or shall be construed to confer upon Borrower any right to
employment or continued employment with the Company, or shall alter in any
way the nature of Borrower's employment with the Company.
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5. MISCELLANEOUS.
(a) SUCCESSORS AND ASSIGNS. The terms and conditions of this Agreement
shall inure to the benefit of and be binding upon the respective successors
and assigns of the parties. Nothing in this Agreement, express or implied, is
intended to confer upon any party other than the parties hereto or their
respective successors and assigns any rights, remedies, obligations, or
liabilities under or by reason of this Agreement, except as expressly provided
in this Agreement.
(b) GOVERNING LAW. This Agreement and all acts and transactions pursuant
hereto and the rights and obligations of the parties hereto shall be
governed, construed and interpreted in accordance with the laws of the State
of California, without giving effect to principles of conflicts of law.
(c) NOTICES. Any notice required or permitted by this Agreement shall be
in writing and shall be deemed sufficient upon receipt, when delivered
personally or by a nationally-recognized delivery service (such as Federal
Express or UPS) or confirmed facsimile, or forty-eight (48) hours after being
deposited in the U.S. mail as certified or registered mail with postage
prepaid, if such notice is addressed to the party to be notified at such
party's address or facsimile number as set forth below, or as subsequently
modified by written notice.
(d) SEVERABILITY. If one or more provisions of this Agreement are held
to be unenforceable under applicable law, the parties agree to renegotiate
such provision in good faith. In the event that the parties cannot reach a
mutually agreeable and enforceable replacement for such provision, then (i)
such provision shall be excluded from this Agreement, (ii) the balance of the
Agreement shall be interpreted as if such provision were so excluded and
(iii) the balance of the Agreement shall be enforceable in accordance with
its terms.
(e) ADVICE OF LEGAL COUNSEL. Each party acknowledges and represents
that, in executing this Agreement, it has had the opportunity to seek advice
as to its legal rights from legal counsel and that the person signing on its
behalf has read and understood all of the terms and provisions of this
Agreement. This Agreement shall not be construed against any party by reason
of the drafting or preparation thereof.
[Signature Page Follows]
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The parties hereto have executed this Secured Loan Agreement as of the
day and year first above written.
By: /s/ W. Xxxxx Xxxxxxxx
------------------------------------
W. XXXXX XXXXXXXX
Address: 00 Xxxxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
INTERMUNE PHARMACEUTICALS, INC.
By: /s/ Xxxxx X. Xxxxx
------------------------------------
Xxxxx X. Xxxxx
Director
Address: 0000 Xxxx Xxxxxxxx Xxxx, Xxxxx 000
Xxxx Xxxx, XX 00000
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EXHIBIT A
SECURED PROMISSORY NOTE
$100,000 Palo Alto, California
July 1, 1999
FOR VALUE RECEIVED, W. XXXXX XXXXXXXX ("Borrower") promises to pay to
INTERMUNE PHARMACEUTICALS, INC., a California corporation (the "Company"), the
principal sum of One Hundred Thousand Dollars ($100,000), together with
interest on the unpaid principal hereof from the date hereof at the rate of
7.5% per annum, compounded annually.
All principal and accrued interest shall be due and payable in full on
the earliest of (a) October 30, 2000 or (b) the termination of Borrower's
employment or consulting relationship with the Company for any reason (or for
no reason). Payments of principal and interest shall be made in lawful money
of the United States of America and shall be credited first to the accrued
interest, with the remainder applied to principal.
Borrower may at any time prepay all or any portion of the principal or
interest owing hereunder.
This Note is subject to the terms of a Secured Loan Agreement, dated as
of July 1, 1999, by and between the Company and Borrower, and is secured by a
pledge of Common Stock of the Company issuable upon exercise of vested
options held by Borrower under the terms of a Security Agreement July 1, 1999
and is subject to all the provisions thereof.
Should any action be instituted for the collection of this Note, the
reasonable costs and attorneys' fees therein of the holder shall be paid by
Borrower.
The holder of this Note shall have full recourse against Borrower, and
shall not be required to proceed against the collateral securing this Note in
the event of default.
By: /s/ W. Xxxxx Xxxxxxxx
-----------------------------------
W. XXXXX XXXXXXXX
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EXHIBIT B
SECURITY AGREEMENT
This SECURITY AGREEMENT is made as of July 1, 1999 by and between
INTERMUNE PHARMACEUTICALS, INC., a California corporation ("Pledgee"), and W.
XXXXX XXXXXXXX ("Pledgor").
RECITALS
Pledgee has loaned to Pledgor, and Pledgor has borrowed from Pledgee, an
aggregate of $100,000, which loan is or shall be evidenced by a promissory
note (the "Note") and is to be secured by up to an aggregate of 100,000
shares of Pledgee's Common Stock (the "Shares") (as adjusted for subsequent
stock splits, reverse stock splits and recapitalization) issuable upon
exercise of vested options held or hereafter acquired by Pledgee (the
"Options").
AGREEMENT
In consideration of the foregoing, and for other good and valuable
consideration, the receipt of which is hereby acknowledged, the parties to
this Agreement agree as follows:
1. CREATION AND DESCRIPTION OF SECURITY INTEREST; TRANSFERABILITY; ESCROW.
(a) In consideration of the loan to Pledgor, Pledgor, pursuant to the
Commercial Code of the State of California, hereby pledges the Shares
(sometimes referred to in this Agreement as the "Collateral"). If any of the
Options are exercised, the certificates representing the Shares shall be
delivered immediately, duly endorsed in blank or with executed stock powers,
to the Secretary of Pledgee (the "Pledgeholder"), who shall hold said
certificates subject to the terms and conditions of this Security Agreement.
(b) The pledged stock (together with an executed blank stock assignment
for use in transferring all or a portion of the Shares to Pledgee if, as and
when required pursuant to this Security Agreement) shall be held by the
Pledgeholder as security for the repayment of the Note, and any extensions or
renewals thereof, to be executed by Pledgor pursuant to the terms of the
Secured Loan Agreement.
(c) Except as required to enable Pledgee to exercise its rights as a
secured party, neither the Shares pledged under this Section 1 nor the
Options may be sold, transferred, pledged, hypothecated or otherwise disposed
of by Pledgor.
(d) To ensure the ability of Pledgee to exercise its rights as a secured
party hereunder, Pledgor shall, upon any exercise of the Options, deliver and
deposit with the Secretary of Pledgee, or such other person designated by
Pledgee, the share certificates representing the
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Shares. together with a stock power, duly endorsed in blank, in the form
attached hereto as Exhibit B-1. The Shares and stock power(s) shall be held
by Pledgee in escrow, until such time as the Note shall have been paid in
full.
2. PLEDGOR'S REPRESENTATIONS AND COVENANTS. To induce Pledgee to enter
into this Security Agreement, Pledgor represents and covenants to Pledgee,
its successors and assigns, as follows:
(a) PAYMENT OF INDEBTEDNESS. Pledgor will pay the principal sum of the Note
secured hereby, together with interest thereon, at the time and in the manner
provided in the Note.
(b) ENCUMBRANCES. All Shares now or hereafter pledged under this Agreement
are and shall be free of all other encumbrances, defenses and liens, and
Pledgor will not further encumber the Shares without the prior written
consent of Pledgee.
3. VOTING RIGHTS. During the term of this pledge and so long as all
payments of principal and interest are made as they become due under the
terms of the Note, Pledgor shall have the right to vote all of the Shares
pledged hereunder.
4. STOCK ADJUSTMENTS. In the event that during the term of the pledge
any stock dividend, reclassification, readjustment or other changes declared
or made in the capital structure of Pledgee, all new, substituted and
additional shares or other securities issued by reason of any such change
shall be delivered to and held by the Pledgeholder under the terms of this
Security Agreement in the same manner as the Shares originally pledged
hereunder. In the event of substitution of such securities, Pledgor, Pledgee
and Pledgeholder shall cooperate and execute such documents as are reasonable
so as to provide for the substitution of such Collateral and, upon such
substitution, references to "Shares" in this Security Agreement shall include
the substituted shares of capital stock of Pledgee held by Pledgor as a
result thereof.
5. WARRANTS AND RIGHTS. In the event that, during the term of this
pledge, subscription warrants or other rights or options shall be issued in
connection with the pledged Shares, such rights, warrants and options shall
be the property of Pledgor and, if exercised by Pledgor, all new stock or
other securities so acquired by Pledgor as it relates to the pledged Shares
then held by Pledgeholder shall be immediately delivered to Pledgeholder, to
be held under the terms of this Security Agreement in the same manner as the
Shares pledged.
6. DEFAULT. Pledgor shall be deemed to be in default of the Note and of
this Security Agreement in the event:
(a) Payment of principal or interest on the Note shall be delinquent for
a period of ten (10) days or more; or
(b) Pledgor fails to perform any of the covenants contained in this
Security Agreement for a period of ten (10) days after written notice thereof
from Pledgee.
7. REMEDIES IN THE EVENT OF DEFAULT. In the case of an event of default,
as set forth above, Pledgee shall have the right to accelerate payment of the
Note upon notice to Pledgor,
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and shall thereafter be entitled to pursue any or all of its remedies under
applicable law, including, without limitation, (a) offsetting from Pledgor's
salary, bonuses, vacation pay or other amounts due to Pledgor from the Pledgee,
any amount due and payable by Pledgor under the Note, and/or (b) proceeding
against the Collateral in accordance with the California Commercial Code.
8. WITHDRAWAL OR SUBSTITUTION OF COLLATERAL. Pledgor shall not sell,
withdraw, pledge, substitute or otherwise dispose of all or any part of the
Collateral without the prior written consent of Pledgee.
9. TERM. The pledge of Shares shall continue until the payment of all
indebtedness secured hereby, at which time the remaining pledged stock shall
be promptly delivered to Pledgor.
10. INSOLVENCY. Pledgor agrees that if a bankruptcy or insolvency
proceeding is instituted by or against Pledgor, or if a receiver is appointed
for the property of Pledgor, or if Pledgor makes an assignment for the
benefit of creditors, the entire amount unpaid on the Note shall become
immediately due and payable, and Pledgee may proceed as provided in the case
of default.
11. PLEDGEHOLDER LIABILITY. In the absence of willful or gross
negligence, Pledgeholder shall not be liable to any party for any of his
acts, or omissions to act, as Pledgeholder.
12. MISCELLANEOUS.
(a) SUCCESSORS AND ASSIGNS. The terms and conditions of this Agreement
shall inure to the benefit of and be binding upon the respective successors
and assigns of the parties. Nothing in this Agreement, express or implied, is
intended to confer upon any party other than the parties hereto or their
respective successors and assigns any rights, remedies, obligations, or
liabilities under or by reason of this Agreement, except as expressly
provided in this Agreement.
(b) GOVERNING LAW. This Agreement and all acts and transactions pursuant
hereto and the rights and obligations of the parties hereto shall be
governed, construed and interpreted in accordance with the laws of the State
of California, without giving effect to principles of conflicts of law.
(c) NOTICES. Any notice required or permitted by this Agreement shall be
in writing and shall be deemed sufficient upon receipt, when delivered
personally or by a nationally-recognized delivery service (such as Federal
Express or UPS) or confirmed facsimile, or forty-eight (48) hours after being
deposited in the U.S. mail as certified or registered mail with postage
prepaid, if such notice is addressed to the party to be notified at such
party's address or facsimile number as set forth below, or as subsequently
modified by written notice.
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(d) SEVERABILITY. If one or more provisions of this Agreement are held
to be unenforceable under applicable law, the parties agree to renegotiate
such provision in good faith. In the event that the parties cannot reach a
mutually agreeable and enforceable replacement for such provision, then (i)
such provision shall be excluded from this Agreement, (ii) the balance of the
Agreement shall be interpreted as if such provision were so excluded and
(iii) the balance of the Agreement shall be enforceable in accordance with
its terms.
(e) ADVICE OF LEGAL COUNSEL. Each party acknowledges and represents
that, in executing this Agreement, it has had the opportunity to seek advice
as to its legal rights from legal counsel and that the person signing on its
behalf has read and understood all of the terms and provisions of this
Agreement. This Agreement shall not be construed against any party by reason
of the drafting or preparation thereof.
The parties hereto have executed this SECURITY AGREEMENT as of the day and
year first above written.
By: /s/ W. Xxxxx Xxxxxxxx
-------------------------------------
W. XXXXX XXXXXXXX
Address: 00 Xxxxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
INTERMUNE PHARMACEUTICALS, INC.
By: /s/ Xxxxx X. Xxxxx
-------------------------------------
Xxxxx X. Xxxxx
Director
Address: 0000 X. Xxxxxxxx Xxxx, Xxxxx 000
Xxxx Xxxx, XX 00000
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EXHIBIT B-1
ASSIGNMENT SEPARATE FROM CERTIFICATE
FOR VALUE RECEIVED I hereby sell, assign and transfer unto INTERMUNE
PHARMACEUTICALS, INC., a California Corporation, (the "Company") One Hundred
Thousand (100,000) shares of the Company's Common Stock standing in my name
on the books of said corporation and represented by Certificate No(s)
___________________________, herewith and do hereby irrevocably constitute and
appoint the Stock Administrator or the Secretary of the Company to transfer
said stock on the books of the within-named corporation with full power of
substitution in the premises.
Dated: July 1, 1999
By: /s/ W. Xxxxx Xxxxxxxx
-------------------------------------
W. XXXXX XXXXXXXX
This Assignment Separate from Certificate was executed in conjunction with
the terms of a Security Agreement between the above assignor and the Company
dated July 1, 1999.
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