LOAN AND SECURITY AGREEMENT
THIS LOAN AND SECURITY AGREEMENT (this "Agreement") is made as of March
25, 1998 by and between ARE-4757 NEXUS CENTRE, LLC, a Delaware limited liability
company ("Lender"), and MATRIX PHARMACEUTICAL, INC., a Delaware corporation
("Borrower"), with respect to the following Recitals:
R E C I T A L S
A. Borrower is the owner of the Improvements (as hereinafter
defined).
B. Borrower desires to borrow from Lender, and Lender is
willing to loan to Borrower, the principal amount of Six Million Dollars
($6,000,000.00) for the purposes and upon the terms set forth herein.
A G R E E M E N T
NOW THEREFORE, in consideration of the foregoing, and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
65535RT65535CLE 1
GENERAL DEFINITIONS
When used herein, the following initially capitalized terms shall have
the following meanings:
"Affiliate" means, with respect to any Person, any other Person which
controls, is controlled by, or is under common control with the Person in
question. For the purposes of the foregoing definition, "controls" (and its
correlative terms "controlled by" and "under common control with") means
possession by the applicable Person of the power to direct or cause the
direction of the management and policies thereof, whether through the ownership
of voting securities, by contract, or otherwise.
"Agreement" means this Loan and Security Agreement, together with all
supplements, amendments and modifications hereto and all extensions and renewals
hereof.
"Attorneys' Fees," "Attorneys' Fees and Costs," "attorneys' fees" and
"attorneys' fees and
costs" mean the reasonable fees and expenses of counsel to the applicable
parties to the Loan Documents, which may include printing, photostating,
duplicating, facsimilating, messengering, filing and other expenses, air freight
charges, and fees billed for law clerks, paralegals, librarians and others not
admitted to the bar but performing services under the supervision of an
attorney. The terms "attorneys' fees" or "attorneys' fees and costs" shall also
include, without limitation, all such fees and expenses incurred with respect to
appeals, arbitrations, bankruptcy proceedings and any post-judgment proceedings
to collect any judgment, and whether or not any action or proceeding is brought
with respect to the matter for which, such fees and expenses were incurred, but
shall not include any such fees or expenses incurred in connection with the
preparation and negotiation of the Lease or the Purchase Agreement. The recovery
of post-judgment fees, costs and expenses is separate and several and shall
survive the merger of the applicable Loan Documents into any judgment.
"Bankruptcy Code" means Titles 7, 11 or 13 of the U.S. Code, as
applicable, or any similar federal or state laws for the relief of debtors, each
as hereafter amended.
"Business Day" means any day other than a Saturday, a Sunday, a legal
holiday under the laws of the State of California or a day on which commercial
banks in such state are authorized or required by law or other governmental
action to be closed.
"Closing Date" means the date of the closing of the Loan and the
recordation of the Deed of Trust in the Official Records of the County in which
the Project is situated.
"Contractual Obligation" as applied to any Person means any provision
of any instrument, document or security issued by that Person or of any
indenture, mortgage, deed of trust, contract, undertaking, agreement or other
instrument to which that Person is a party or by which any of its properties is
bound or to which it or any of its properties is subject.
"Deed of Trust" means that certain Deed of Trust and Fixture Filing of
even date herewith executed by Borrower, as trustor, to Chicago Title Insurance
Company, as trustee, and naming Lender, as beneficiary, to be recorded on the
Closing Date in the Official Records of the County in which the Project is
situated.
"Default Interest Rate" means an interest rate that is the lesser of
(i) eighteen percent (18%) per annum or (ii) the maximum rate permitted by law.
"Environmental Laws" is defined in the Lease.
"Event of Default" means any of the events specified in Section 6.1.
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"Formation Documents" means (a) as to any corporation, its articles of
incorporation and bylaws, (b) as to any limited partnership, its Certificate of
Limited Partnership and partnership agreement, (c) as to any general partnership
or joint venture, its Statement of Partnership and partnership agreement, (d) as
to any limited liability company, its articles or certificate of organization
and operating agreement, and (e) as to any trust, its trust agreement and a
certification of the current trustees thereof, each of the foregoing together
with all supplements, amendments and modifications.
"General Partner" or "general partner" means the general partners of
the partnership in question, together with any constituent general partners of
such general partners.
"Governmental Agency" means any federal, state, municipal or other
governmental or quasi-governmental court, agency, authority or district.
"Hazardous Substances" is defined in the Lease.
"Improvements" means all fixtures and interior improvements located
within the manufacturing suites cross-hatched on Exhibit B-1 attached hereto
(which manufacturing suites are located within the buildings upon the Project),
including, without limitation, the fixtures and improvements to the extent
constituting real property and located therein and identified on Exhibit B-2
attached hereto, together with all present and future attachments, accessions,
replacements, substitutions and additions thereto or therefor, and together with
all insurance proceeds relating to the loss of or damage to such fixtures or
improvements which Borrower receives from any policy of insurance covering any
of the foregoing property now or hereafter acquired by Borrower.
"Indemnitees" means, collectively and individually, Lender, its
Affiliates and its and their directors, officers, agents, employees, successors
and assigns.
"Laws" means all federal, state, county, municipal and other
governmental and quasi-governmental statutes, laws, rules, orders, regulations,
ordinances, judgments, decrees and injunctions affecting Borrower's interest in
the Project or Borrower's occupancy, operation, ownership or use thereof,
whether now or hereafter enacted and in force including, without limitation, the
Americans With Disabilities Act, 42 U.S.C. xx.xx. 12101-12213 (1991) and all
Environmental Laws, any zoning or other land use entitlements and any
requirements which may require repairs, modifications or alterations in or to
the Project, all Permits and all covenants, agreements, restrictions and
encumbrances running in favor of any Person, contained in any instruments,
either of record or known to Borrower, at any time in force affecting Borrower's
interest in the Project or Borrower's occupancy, operation, ownership or use
thereof.
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"Lease" means that certain Lease of even date herewith by and between
Lender, as landlord, and Borrower, as tenant, pursuant to which Borrower has
leased from Lender a portion of the Project.
"Lien" means any mortgage, deed of trust, pledge, security interest,
encumbrance, lien, charge or claim of any kind (including any agreement to give
any of the foregoing, any conditional sale or other title retention agreement,
any lease in the nature thereof, and/or the filing of or agreement to give any
financing statement under the Uniform Commercial Code of any jurisdiction) with
respect to Borrower's interest in the Project or the Personal Property or any
portion thereof or interest therein.
"Loan" means the loan to Borrower as more particularly described in
Section 2.1.
"Loan Documents" means the documents described in Section 3.1, and all
other documents securing, or executed in connection with, the Loan, together
with all renewals, substitutions, extensions, modifications or replacements
thereof.
"Maturity Date" means the date set forth in the Note upon which the
entire principal amount of the Loan, together with all other amounts owing to
Lender under the Loan Documents, shall be due and payable.
"Note" means that certain Secured Promissory Note of even date herewith
in the principal amount of Six Million Dollars ($6,000,000.00) executed by
Borrower, as maker, in favor of Lender, as holder, substantially in the form of
Exhibit D attached hereto, and any and all modifications, extensions, renewals
and replacements thereof.
"Permits" means all permits, licenses, franchises, approvals, variances
and land use entitlements necessary for Borrower's occupancy, operation,
ownership and use of the Project.
"Permitted Liens" means the liens and encumbrances identified on
Exhibit E attached hereto.
"Person" means and includes natural persons, corporations, limited
liability companies, limited liability partnerships, limited partnerships,
general partnerships, joint stock companies, joint ventures, associations,
companies, trusts, banks, trust companies, land trusts, business trusts, real
estate investment trusts or other organizations, whether or not legal entities,
and governments and agencies and political subdivisions thereof.
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"Personal Property" means all personal property described on Exhibit C
attached hereto, together with all present and future attachments, accessions,
replacements, substitutions and additions thereto or therefor, and together with
all insurance proceeds relating to the loss of or damage to such personal
property which Borrower receives from any policy of insurance covering any of
the foregoing property now or hereafter acquired by Borrower; provided, however,
that "Personal Property" shall not include any of Borrower's inventory or work
in process.
"Potential Default" means a condition or event which, with the giving
of notice or passage of time, or both, would constitute an Event of Default
under any of the Loan Documents or the Lease.
"Principals" means individually and collectively Borrower, its general
partners, managing members and major shareholders, as applicable, and each of
such parties' constituent general partners, managing members and major
shareholders, as applicable.
"Project" means that certain parcel of land described on Exhibit A
attached hereto.
"Project Documents" means (a) all agreements to which Borrower is a
party now or hereafter in effect with any contractor, architect or engineer,
including, without limitation, any design architect, landscape architect, civil
engineer, electrical engineer, environmental engineer, soils engineer or
mechanical engineer, in connection with Borrower's interest in the Project; (b)
all other agreements to which Borrower is a party now or hereafter in effect
with any property manager or broker with respect to the management, subleasing,
or operation of Borrower's interest in the Project; (c) all as-built plans and
specifications and surveys for the Project; (d) all Permits; and (e) all
renewals, substitutions, extensions, modifications or replacements of any of the
foregoing.
"Purchase Agreement" means that certain Purchase and Sale Agreement and
Joint Escrow Instructions, dated as of February 3, 1998, by and between
Borrower, as seller, and Alexandria Real Estate Equities, Inc., a Maryland
corporation, as buyer.
"Related Parties" means Borrower, Principals, any Affiliate of Borrower
or Principals, any partnership of which Borrower or any Principal is a general
partner, and any limited liability company of which Borrower or any Principal is
a manager or managing member.
"Secured Obligations" is defined in the Deed of Trust.
"Tax Identification Number" means Borrower's employer identification
number or social security number, which is 00-0000000.
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"Title Policy" means an American Land Title Association Extended
Coverage Policy of Title Insurance (1970 version, amended 10/17/70 only), issued
by Chicago Title Insurance Company ("Title Company"), insuring Lender that on
the Closing Date the Deed of Trust is a valid first lien on the Improvements,
and is in the amount of the Loan. The Title Policy shall contain such
endorsements as Lender reasonably requires and shall be subject only to such
exceptions to coverage as approved by Lender in writing prior to the Closing
Date.
65535RT65535CLE 2
LOAN TERMS
2.1 Loan and Disbursements of Loan Proceeds.
Subject to the terms and conditions of this Agreement, and in
reliance upon the representations and warranties of Borrower set forth in the
Loan Documents, Lender agrees to make to Borrower, and Borrower agrees to accept
from Lender, a loan (the "Loan") in the principal amount of Six Million Dollars
($6,000,000.00). The Loan proceeds shall be disbursed by Lender on the Closing
Date.
2.2 Evidence of Indebtedness and Maturity.
Borrower shall execute and deliver to Lender, on or before the
Closing Date, the Note evidencing the Loan. Borrower agrees to repay the
indebtedness evidenced by the Note in accordance with the terms thereof and the
terms hereof. The outstanding principal balance of the Loan, together with
accrued and unpaid interest thereon and all other amounts payable by Borrower
under the Loan Documents shall be due and payable on the Maturity Date.
2.3 Interest Rate.
The Loan shall bear interest at the rate per annum specified
in the Note.
65535RT65535CLE 3
CONDITIONS TO LOAN
3.1 Condition Precedent to Closing of Loan.
As a condition precedent to Lender's obligation to close the
Loan and disburse any Loan proceeds, on or before the Closing Date Borrower must
satisfy and fulfill each of the following conditions precedent to closing, to
the satisfaction of Lender:
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A. Loan Documents. Borrower shall deliver to Lender the
following documents, each duly executed and acknowledged by a notary public
where necessary, and in form and substance satisfactory to Lender:
(i) This Agreement;
(ii) The Lease;
(iii) The Note;
(iv) The Deed of Trust; and
(v) A California UCC-1 Financing Statement
relating to the Personal Property and the Improvements (to the extent that the
Improvements or any portion thereof or proceeds therefrom constitute personal
property), to be filed with the California Secretary of State, together with
UCC-1 Financing Statements for such other States as are required by Lender.
B. Title. The Title Company shall be irrevocably and
unconditionally committed to issue the Title Policy to Lender in the form and
with such endorsements required by Lender.
C. Opinion. Borrower's counsel shall be committed to deliver
to Lender an opinion regarding the enforceability and the due authorization,
execution and delivery of this Agreement, the Note and the Deed of Trust, in
form and substance, and containing such assumptions and qualifications, as may
be reasonably satisfactory to Lender's counsel.
D. Truth of Representations and Warranties. The
representations and warranties of Borrower contained herein and in the other
Loan Documents, the Lease and the Purchase Agreement shall be true, correct and
complete in all material respects on the Closing Date.
E. No Default. As of the Closing Date, no event shall have
occurred or would result from the funding of the Loan that would constitute an
Event of Default or a Potential Default.
65535RT65535CLE 4
SECURITY AGREEMENT
4.1 Grant of Security Interest.
As security for the payment and performance of the Secured
Obligations, subject to the terms and conditions hereof, Borrower hereby
assigns, transfers and grants to Lender, and there is hereby created in favor of
Lender, a security interest under the California Commercial
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Code in and to the Personal Property and the Improvements (to the extent that
the Improvements or any portion thereof or proceeds therefrom constitute
personal property), whether now owned or hereafter acquired, and in all proceeds
thereof (and proceeds of proceeds). This Agreement shall constitute a security
agreement pursuant to the California Commercial Code with respect to the
Personal Property and the Improvements (to the extent that the Improvements or
any portion thereof or proceeds therefrom constitute personal property) and the
proceeds thereof, with Borrower the "Debtor" and Lender the "Secured Party" as
such terms are used therein.
4.2 Representations, Agreements and Covenants Regarding Personal
Property and Improvements.
In order to induce Lender to enter into this Agreement and
make the Loan, Borrower represents, warrants and covenants as follows:
A. Except for the security interest in favor of Lender and the
Permitted Liens, Borrower is, and as to any of the Personal Property or the
Improvements acquired after the date hereof will be, the sole owner of such
Personal Property and Improvements, free from any adverse lien, security
interest, or adverse claim of any kind whatsoever. Borrower will notify Lender
of and will defend such Personal Property and Improvements against all claims
and demands of all persons at any time claiming any interest therein.
B. Borrower will keep the Personal Property and the
Improvements in good condition and repair, and will not misuse, abuse, allow to
deteriorate, waste or destroy such Personal Property or Improvements or any part
thereof, except for ordinary wear and tear resulting from normal and expected
use in the ordinary course of Borrower's business, which shall be promptly
replaced by Borrower with property of similar nature and of equal or greater
value unless obsolete.
C. Borrower will not, without the prior written consent of
Lender, sell, offer to sell or otherwise transfer, exchange or dispose of the
Personal Property or the Improvements or any interest therein, unless such
Personal Property or Improvements are being replaced by collateral of similar
nature and of equal or greater value. If the Personal Property or the
Improvements or any part thereof are sold, transferred, exchanged, or otherwise
disposed of (either with or without the written consent of Lender), the security
interest of Lender shall extend to the proceeds of such sale, transfer, exchange
or other disposition and Borrower will hold such proceeds in a separate account
for Lender's benefit and will, at Lender's request, transfer such proceeds to
Lender.
D. The tangible Personal Property will be kept on or at the
Project and Borrower will not, without the prior written consent of Lender,
remove the Personal Property or
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the Improvements (to the extent that the Improvements or any portion thereof
constitute personal property) therefrom or otherwise sever the Improvements from
the Project except such portions or items of such Personal Property or
Improvements which are consumed or worn out in ordinary usage or due to casualty
not caused by Borrower, all of which shall be promptly replaced by Borrower as
provided in Section 4.2(B).
E. Borrower will immediately notify Lender in writing of any
change in its place of business or the adoption or change of any trade name or
fictitious business name, and will, within ten (10) days after Lender's request,
execute any additional financing statements or other certificates reasonably
requested by Lender to reflect such change.
F. The Personal Property and the Improvements are not and will
not be used or bought for personal, family or household purposes.
G. Borrower shall immediately notify Lender of any claim
against the Personal Property or the Improvements adverse to the interest of
Borrower or Lender therein.
H. Lender may examine and inspect the Personal Property and
the Improvements at any reasonable time, wherever located, upon reasonable prior
notice to Borrower.
4.3 Affixed Collateral.
The inclusion in Section 4.1 of any Personal Property or
Improvements (to the extent that the Improvements or any portion thereof
constitute personal property) which may now be or hereafter become affixed or in
any manner attached to the Project shall be without prejudice to any claim at
any time made by Lender that such Personal Property or Improvements are or have
become a part of or an accession to the Project.
4.4 Further Security Agreements.
Borrower agrees to take such actions and, within ten (10) days
after Lender's request, to execute, deliver and file and/or record such
documents, agreements and financing statements as may be reasonably necessary to
evidence the security interest set forth in Section 4.1, to establish the
priority thereof and to carry out the intent and purpose of this Article 4.
4.5 Borrower's License.
Notwithstanding anything to the contrary herein, as long as
there shall exist no Event of Default hereunder, Borrower shall have the right
under a license hereby granted by
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Lender to collect, but not prior to accrual, all cash proceeds arising from (i)
Borrower's ownership of the Personal Property and Improvements, (ii) Borrower's
leasehold interest in the Project as a result of Borrower's leasing or licensing
thereof and (iii) the ordinary course of Borrower's business in the Project;
provided that, except as otherwise provided herein, Borrower shall not sell,
encumber, pledge or otherwise dispose of the Personal Property or Improvements
without the Lender's prior written approval, which may be withheld in Lender's
sole discretion.
65535RT65535CLE 5
BORROWER'S REPRESENTATIONS AND WARRANTIES
As an inducement to Lender to execute this Agreement and make the Loan,
Borrower represents and warrants to Lender the truth and accuracy of the matters
set forth in this Article 5.
5.1 Organization, Power, Good Standing, and Business.
Borrower is a corporation duly formed, validly existing and in
good standing under the Laws of the State of Delaware and, if formed under the
Laws of a jurisdiction other than the State of California, has registered to do
business and is in good standing under the Laws of the State of California.
Borrower has the full power and authority to own and operate its properties, to
carry on its business as now conducted, to enter into each Loan Document, and to
carry out the transactions contemplated hereby and thereby. Borrower does not do
business under any trade name or fictitious business name other than "Matrix
Pharmaceutical". Borrower has delivered to Lender true, correct and complete
copies of its Formation Documents and such Formation Documents have not been
amended or modified except pursuant to agreements delivered to Lender prior to
the date hereof.
5.2 Authorization of Borrowing, etc.
A. Authorization of Borrowing. The execution, delivery and
performance of the Loan Documents and the issuance, delivery and payment of the
Note have been duly authorized by all necessary action of Borrower.
B. No Conflict. The execution, delivery and performance by
Borrower of each applicable Loan Document do not and will not (i) violate any
Law applicable to any such Person, the Formation Documents of any such Person,
or any order, judgment or decree of any court or other Governmental Agency
binding on any such Person; (ii) conflict with, result in a breach of or
constitute (with the giving of notice or the passage of time or both) a default
under any Contractual Obligation of any such Person; (iii) result in or require
the creation or imposition
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of any Lien of any nature on Borrower's properties or assets other than the
Liens in favor of Lender under the Loan Documents; or (iv) require any approval
or consent of any Person under any Contractual Obligation of Borrower.
C. Governmental Consents. The execution, delivery and
performance by Borrower of each applicable Loan Document does not and will not
require any registration with, consent or approval of, or notice to, or other
action to, with or by, any Governmental Agency or other Person.
D. Binding Obligation. The Note and the other Loan Documents
are the legally valid and binding obligations of Borrower, enforceable against
Borrower in accordance with their respective terms, except as enforcement may be
limited by bankruptcy, insolvency, reorganization, moratorium or similar laws
relating to or limiting creditors' rights generally.
5.3 Actions.
There is no action, suit, proceeding or arbitration, before or
by any Governmental Agency or other Person, pending or, to Borrower's best
knowledge, threatened against or affecting Borrower, any of the Principals or
any properties or rights of Borrower or any of the Principals, which might
adversely affect Lender's rights or remedies under the Loan Documents, the
business, assets, operations or financial condition of any such party or its
ability to perform its obligations under the Loan Documents. As of the date
hereof, there are no outstanding judgments against the Related Parties or their
property.
5.4 Financial Position.
A. Financial Information. All financial statements and
financial data delivered to Lender in connection with the Loan and/or relating
to Borrower and the Principals are true, correct and complete in all material
respects and accurately present the financial position of such parties as of the
date thereof. No material adverse change has occurred in the financial position
disclosed by any financial statements or financial data delivered to Lender.
B. Bankruptcy and Insolvency. Neither Borrower nor any of the
Related Parties has filed or been the subject of any bankruptcy, insolvency,
reorganization, dissolution or similar proceeding or any proceeding for the
appointment of a receiver or trustee for all or any substantial part of their
respective property. Neither Borrower nor any of the Related Parties has
admitted in writing its inability to pay its debts when due, made an assignment
for the benefit of creditors or taken other similar action.
C. Other Borrowing. Except for the Loan, no borrowings have
been made by
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Borrower which are secured by the Improvements or which might give rise to any
Lien other than the Liens created by the Loan Documents.
5.5 Liens.
Borrower is the sole owner of the Improvements free from any
adverse Liens, except for Liens and other rights in favor of Lender and for the
Permitted Liens. Borrower has paid in full all contractors, materialmen,
laborers, architects or other such Persons hired by Borrower to perform services
or work with respect to the Improvements and all statutory lien periods have
expired with respect to any such services or work. No previous assignment, sale,
pledge, encumbrance or other hypothecation of the Improvements has been made
(except for Permitted Liens and pledges and encumbrances which have been
released in full prior to the date hereof or will be released in full
concurrently with the funding of the Loan).
5.6 Defects.
To the best of Borrower's knowledge, there are no defects,
facts or conditions affecting the Improvements or any portion thereof which
would make the Improvements unsuitable for their intended operation, use or
sale.
5.7 No Defaults.
No Potential Default or Event of Default exists under this
Agreement, the Lease, the Purchase Agreement or any of the other Loan Documents.
To the best of Borrower's knowledge, no default by Borrower exists under any
Contractual Obligation which would have a material adverse effect on Borrower's
ability to repay the Loan or to perform its obligations under any of the Loan
Documents or the Lease.
5.8 Disclosure.
No representation or warranty of Borrower contained in this
Agreement, the Lease, the Purchase Agreement or any Loan Document contains any
untrue statement of a material fact or omits to state a material fact necessary
in order to make the statements contained herein or therein not misleading.
65535RT65535CLE 6
BORROWER'S COVENANTS
Borrower covenants and agrees that, until the Loan and all
other amounts owing
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to Lender under the Loan Documents have been paid in full and all Secured
Obligations have been satisfied, Borrower shall perform all of the covenants in
this Article 6.
6.1 No Liens.
Borrower shall not permit any Lien to be made or filed with
respect to the Improvements except for Liens which are being contested in good
faith, for which adequate reserves have been established and which do not pose
an imminent risk to the Improvements or the Personal Property. Borrower shall be
the sole owner of the Improvements, free from any adverse Liens, except for
Permitted Liens and Liens in favor of Lender. Borrower shall not assign, sell,
pledge, encumber or otherwise hypothecate all or any portion of the
Improvements.
6.2 Compliance with Laws.
Borrower shall comply with all Laws applicable to Borrower,
its property, Borrower's interest in the Project, the Personal Property, the
Improvements and/or Borrower's occupancy, operation, ownership or use thereof.
6.3 Inspection.
During normal business hours and upon reasonable advance
notice, Borrower shall permit Lender and any Person designated by Lender to
visit and inspect the Improvements.
6.4 Environmental Matters.
Borrower shall comply and cause all persons entering the
Project to comply with all Environmental Laws and all of Borrower's covenants
relating to Hazardous Substances set forth in the Lease.
6.5 Insurance Requirements.
Borrower shall procure and maintain, or cause to be procured
and maintained, at all times until the repayment of the Loan and the
satisfaction of the Secured Obligations, policies of insurance in form and
amounts satisfying the requirements of the Lease.
6.6 Notice of Proceeding.
Borrower will promptly notify Lender of any action, suit,
proceeding or arbitration (including, without limitation, any judicial or
nonjudicial foreclosure proceeding, any
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voluntary or involuntary bankruptcy proceeding or any proceeding for the
appointment of a receiver), commenced or threatened against Borrower, the
Improvements, Borrowers' interest in the Project or any portion thereof or
interest therein. Borrower shall deliver to Lender copies of all notices and
other information in connection with any action, suit, proceeding or arbitration
promptly upon receipt or transmittal thereof.
6.7 Representations and Warranties.
Until repayment of the Loan and all other amounts owing to
Lender under the Loan Documents and the satisfaction of all other Secured
Obligations, the representations and warranties set forth in Article 5 shall
remain true and correct.
6.8 Financial Reporting.
Borrower shall deliver to Lender (a) within thirty days
following the end of each fiscal quarter of Borrower, Borrower's unaudited
financial statements and accompanying notes for such quarter and year to date,
certified by Borrower to be true, correct and complete in all respects, (b)
within sixty days following the end of each fiscal year of Borrower, Borrower's
audited financial statements and accompanying notes for such year, certified by
Borrower to be true, correct and complete in all respects, (c) within ten
business days following the occurrence of any event or circumstance which could
reasonably be expected to have a material adverse affect upon the business,
prospects or financial condition of Borrower, notice thereof together with
Borrower's plans to address such event or circumstance, (d) promptly following
the preparation or submission of such items, copies of all 10-K's, 10-Q's,
8-K's, proxy statements, annual reports, Business Plans and other materials as
may be reasonably requested by Buyer pertaining to the financial condition of
Seller.
6.9 Further Assurances.
Borrower shall execute and deliver from time to time, within
ten (10) business days after any request by Lender, any and all instruments,
agreements and documents and shall take such other action as may be reasonably
necessary or desirable in the opinion of Lender to maintain, perfect or insure
Lender's security provided for herein and in the other Loan Documents,
including, without limitation, the execution of UCC-1 renewal statements, the
execution of such amendments to the Deed of Trust and the other Loan Documents
and the delivery of such endorsements to the Title Policy, all as Lender shall
reasonably require, and to the extent that such actions are required as a result
of Borrower's activities or an Event of Default, Borrower shall pay all fees and
expenses (including reasonable attorney's fees) related thereto, and in all
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other circumstances Lender shall be responsible for its own fees and expenses.
65535RT65535CLE 7
EVENTS OF DEFAULT; REMEDIES
7.1 Events of Default.
The occurrence of any of the following events shall constitute
an Event of Default under this Agreement and the other Loan Documents:
A. Failure to Make Payments When Due. Borrower's failure to
pay any principal, interest or other monies due under this Agreement, the Lease
or any of the other Loan Documents within three (3) days after written notice
that such amount is due (provided, however, that Lender shall have no obligation
to give Borrower written notice more than two times in any twelve month period).
B. Breach of Covenants. Borrower's failure to perform or
comply with any other term, obligation or condition contained in this Agreement
or any of the other Loan Documents, within thirty (30) days after the delivery
of written notice from Lender of such failure; provided that if such default is
not reasonably capable of being cured within such thirty (30) day period, such
failure shall not constitute an Event of Default so long as Borrower commences
the cure of such default within such thirty (30) day period and diligently
prosecutes such cure to completion within sixty (60) days after such written
notice from Lender.
C. Breach of Warranty. Any representation, warranty,
certification or other statement made by Borrower herein or in any other Loan
Document or in any statement or certificate at any time given by Borrower or any
of the Principals to Lender in writing in connection with the Loan shall be
materially false or misleading.
D. Involuntary Bankruptcy; Appointment of Receiver, etc.
(i) A court having proper jurisdiction shall enter a decree or
order for relief with respect to Borrower in an involuntary case under the
Bankruptcy Code or any applicable bankruptcy, insolvency or other similar law
now or hereafter in effect, which decree or order is not stayed within seven (7)
days after entry and dismissed within ninety (90) days after the entry of such
order; or any other similar relief shall be granted under any applicable federal
or state law; or
(ii) An involuntary case is commenced against Borrower or any
of the Principals, under any applicable bankruptcy, insolvency or other similar
law now or hereafter in
15
effect; or a decree or order of a court for the appointment of a receiver,
liquidator, sequestrator, trustee, custodian or other officer having similar
powers over Borrower or any of the Principals or over all or a substantial part
of their respective property, shall be entered; or the involuntary appointment
of an interim receiver, trustee or other custodian of Borrower or any of the
Principals, for all or a substantial part of their respective property; or the
issuance of a warrant of attachment, execution or similar process against any
substantial part of the respective property of Borrower or any of the
Principals, and the continuance of any such event in this clause (ii) for ninety
(90) days unless dismissed or discharged.
E. Voluntary Bankruptcy; Appointment of Receiver, etc.
(i) Borrower or any of the Principals shall have an order for
relief entered with respect to them or commence a voluntary case under the
Bankruptcy Code or any applicable bankruptcy, insolvency or other similar law
now or hereafter in effect, or shall consent to the entry of an order for relief
in an involuntary case, or to the conversion of an involuntary case to a
voluntary case, under any such law, or shall consent to the appointment of or
taking possession by a receiver, trustee or other custodian for all or a
substantial part of their respective property; the making by Borrower or any of
the Principals of any assignment for the benefit of creditors; or
(ii) The inability or failure of Borrower or any of the
Principals, or the admission by Borrower or any of the Principals in writing of
its inability, to pay their respective debts as such debts become due.
X. Xxxx Priority. Lender fails to have a legal, valid binding
and enforceable first priority Lien on the Improvements and the Personal
Property subject only to Permitted Liens.
G. Unapproved Transfers. Any transfer of the Improvements, the
Personal Property, Borrower's interest in the Lease or any interest in Borrower
occurs without Lender's prior written consent or otherwise in accordance with of
the Loan Documents.
H. Failure to Maintain Insurance. Borrower fails to maintain
or cause to be maintained the insurance coverage required by Section 6.5.
I. Other Liens. Without limiting the provisions of Section 6.1
of this Agreement, Borrower defaults under any Lien (other than the Liens
created by the Loan Documents) or foreclosure or other proceedings are commenced
to enforce any Lien (other than the Liens created by the Loan Documents).
16
J. Other Loan Documents. The occurrence of an Event of Default
under any of the Loan Documents other than this Agreement or the Lease (as
"Event of Default" is defined therein).
K. Lease. The occurrence of an Event of Default under the
Lease (as "Event of Default" is defined therein).
7.2 General Remedies.
Notwithstanding anything to the contrary contained herein or
in any of the other Loan Documents, upon the occurrence of any Event of Default
(i) at the option of Lender upon written notice to Borrower as to Sections
6.1(A) through (C) and (F) through (I), and automatically without notice to
Borrower as to Sections 7.1(D), (E), (J) and (K), the unpaid principal amount of
the Loan, all accrued and unpaid interest and all other Secured Obligations
shall become immediately due and payable, without presentment, demand, protest,
further notice or other requirements of any kind, all of which are hereby
expressly waived by Borrower, (ii) Lender shall have the rights and remedies of
a secured party under the California Commercial Code, and under any other
applicable law, (iii) Lender may pursue all of its rights and remedies
hereunder, under the other Loan Documents, at law, in equity or otherwise,
including without limitation, obtaining the appointment of a receiver, provided,
however, that if Lender seeks to exercise its right of sale under the Deed of
Trust, the purchaser of the Improvements (including Lender or its affiliates)
shall have the right to cause Borrower to enter into a lease (and Borrower shall
be deemed to have elected to enter into such lease) of the Improvements to
Borrower in accordance with the rent payment as set forth in Article 9 (iv)
Lender may pursue any remedies available to it pursuant to California Code of
Civil Procedure Section 726.5, (v) all outstanding indebtedness and all other
amounts owing to Lender under the Loan Documents shall bear interest at the
Default Interest Rate, and (vi) Lender shall have no further obligation to
disburse Loan proceeds to Borrower.
7.3 Specific Performance.
Upon the occurrence of an Event of Default, Lender may
commence and maintain an action in any court of competent jurisdiction for
specific performance of any of the covenants and agreements contained herein or
in any of the other Loan Documents, may obtain the aid and direction of the
court in the performance of any of the covenants and agreements contained herein
or therein, and may obtain orders or decrees directing the same and, in the case
of any sale under the Deed of Trust, directing, confirming or approving Lender's
or the trustee's actions.
65535RT65535CLE 8
17
MISCELLANEOUS PROVISIONS
8.1 Nonforeign Status.
Section 1445 of the Internal Revenue Code of 1985, as amended
(the "Internal Revenue Code") and Sections 18662, 18668 and 18669 of the
California Revenue and Taxation Code (the "California Tax Code") provide that a
transferee of a U.S. real property interest, or California property interest, as
the case may be, must withhold tax under the circumstances described therein. To
inform Lender that the withholding of tax will not be required in the event of
the disposition of the Improvements pursuant to the terms of the Deed of Trust,
Borrower hereby certifies, under penalty of perjury, that: (a) Borrower is not a
foreign corporation, foreign partnership, foreign trust or foreign estate, as
those terms are defined in the Internal Revenue Code and/or California Tax Code
and the regulations promulgated thereunder; and (b) Borrower's U.S. employer
identification number is the Tax Identification Number; (c) Borrower's principal
place of business is at the address set forth in Section 8.10, and (d) Borrower
is qualified to do business in the State of California. Lender may disclose the
contents of this Section 8.1 to the Internal Revenue Service or any other
Governmental Agency and Borrower acknowledges that any false statement contained
herein could be punished by fine, imprisonment or both. Borrower covenants and
agrees to execute further certificates, which shall be signed under penalty of
perjury, as Lender shall reasonably require in connection with the
certifications set forth herein. The covenant set forth herein shall survive the
foreclosure of the lien of the Deed of Trust or acceptance of a deed in lieu or
in aid thereof.
8.2 Assignments and Participations in Loan and Note.
Lender may assign its rights and delegate its obligations
under this Agreement or any of the other Loan Documents and further may assign,
or sell participations in, all or any part of the Loan, the Loan Documents, or
any other interest herein or in the Note to any Person, all without notice to or
the consent of Borrower. To the extent of any such assignment, Lender shall be
relieved of its obligations with respect to the Loan and the assignee shall have
the same rights, benefits and obligations as it would if it were Lender
hereunder and a holder of the Note. Lender may furnish any information
(including, without limitation, financial information) concerning the
Improvements, the Project, Borrower, Principals and any of their assets to third
parties from time to time for legitimate business purposes (provided, however,
that Lender shall use reasonable efforts to maintain the confidentiality of any
information provided by Borrower of a proprietary nature).
8.3 Expenses.
18
Borrower agrees to pay, within ten (10) days after demand by
Lender, all reasonable costs and expenses (including, without limitation,
reasonable attorneys' fees and costs, fees of any consultants, and fees for any
environmental audits, appraisal, inspections or other review required by Lender)
incurred by Lender in connection with the enforcement of any of the Secured
Obligations, the enforcement of any of Lender's rights and remedies under the
Loan Documents, the collection of any payments owing to Lender hereunder or
under any of the other Loan Documents, whether or not such enforcement and
collection includes the filing of a lawsuit, or the retaking, holding, preparing
for sale or selling the Improvements or the Personal Property or any portion
thereof or any interest therein. Such costs and expenses shall include, without
limitation, Lender's reasonable attorneys' fees and costs, including without
limitation attorneys' fees and costs incurred by Lender in connection with any
insolvency, bankruptcy, reorganization, arrangement or other similar proceedings
involving Borrower or any of the Principals which in any way affect the exercise
by Lender of its rights and remedies hereunder, under any of the other Loan
Documents, at law or in equity.
8.4 Joint and Several Obligations.
The liability of Borrower under this Agreement and under each
of the other Loan Documents shall be joint and several.
8.5 Indemnity.
In addition to the duties of indemnification set forth in the
Lease, Borrower hereby indemnifies and agrees to defend and hold harmless the
Indemnitees from and against any and all expenses, loss, claims, damage or
liability, including, without limitation, architects', engineers' and attorneys'
fees and costs, to the extent arising from: (a) any use, nonuse, misuse,
possession, occupation, alteration, operation, maintenance or management by
Borrower of the Improvements or the Personal Property or any part thereof; (b)
any negligence or willful act or omission on the part of Borrower or its agents,
contractors, servants, employees, licensees or invitees; (c) any accident,
injury (including death) or damage to any person or property relating to the
use, nonuse, misuse, possession, occupation, alteration, operation, maintenance
or management of the Improvements or the Personal Property; (d) any tax
attributable to the execution, delivery, filing or recording of the Deed of
Trust, the Note or the other Loan Documents; (e) any default under the Note or
the other Loan Documents, or (f) any claim by or liability to any contractor or
subcontractor performing work or any party supplying materials to Borrower in
connection with the Improvements or the Personal Property.
8.6 Waiver of Offset.
19
All sums payable by Borrower pursuant to any of the Loan
Documents shall be paid without notice, demand, counterclaim, setoff, deduction
or defense and without abatement, suspension, deferment, diminution or
reduction, and the obligations and liabilities of Borrower under the Loan
Documents shall in no way be released, discharged or otherwise affected (except
as expressly provided in the Loan Documents) by reason of: (a) any damage to or
destruction of the Improvements or any condemnation or eminent domain action
affecting the Improvements or any part thereof; (b) any restriction or
prevention of or interference by any third party with any use of the
Improvements or any part thereof; (c) any title defect or encumbrance or any
eviction from the Project or any part thereof by title paramount or otherwise;
(d) any bankruptcy, insolvency, reorganization, composition, adjustment,
dissolution, liquidation or other like proceeding relating to Lender, or any
action taken with respect to any of the Loan Documents by any trustee or
receiver of Lender, or by any court, in any such proceeding; (e) any claim which
Borrower has or might have against Lender; (f) any default or failure on the
part of Lender to perform or comply with any of the terms hereof or of any other
agreement with Borrower; or (g) any other occurrence whatsoever, whether similar
or dissimilar to the foregoing; whether or not Borrower shall have notice or
knowledge of any of the foregoing. Except as expressly provided herein, Borrower
waives all rights now or hereafter conferred by statute or otherwise to any
abatement, suspension, deferment, diminution or reduction of any of the Secured
Obligations.
8.7 Amendments and Waivers.
This Agreement and the other Loan Documents may only be
modified in writing signed by all of the parties hereto or thereto or their
respective successors and assigns. No waiver of any provision of this Agreement
or of any of the other Loan Documents, or consent to any departure by Borrower
therefrom, shall in any event be effective without the written agreement of
Lender. Any waiver or consent shall be effective only in the specific instance
and for the specific purpose for which it was given. Except as expressly
required by the terms of the Loan Documents, no notice to or demand on Borrower
in any case shall entitle Borrower to any other or further notice or demand in
similar or other circumstances.
8.8 WAIVER OF JURY TRIAL.
BORROWER AND LENDER EACH HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE ANY RIGHT THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT TO ANY
TORT OR CONTRACT LITIGATION BASED HEREON OR ON ANY OF THE OTHER LOAN DOCUMENTS,
OR ARISING OUT OF, UNDER OR IN CONJUNCTION WITH THE NOTE, ANY OTHER LOAN
DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER
VERBAL OR WRITTEN) OR ACTIONS OF EITHER PARTY IN CONNECTION THEREWITH.
20
8.9 Submission of Loan Documents.
The submission of this Agreement or any of the other Loan
Documents to Borrower or its agents or attorneys for review or signature does
not constitute a commitment by Lender to make the Loan to Borrower, and the Loan
Documents shall have no binding force or effect unless and until they are
executed and delivered by Borrower and Lender and all of the conditions set
forth in Section 3.1 have been satisfied.
8.10 Notices.
Any notice, or other document or demand required or permitted
under this Agreement or any of the other Loan Documents shall be in writing
addressed to the appropriate address set forth below and shall be deemed
delivered upon the earliest of (a) actual receipt, (b) confirmation of delivery
by telecopy (provided that a copy is subsequently delivered by regular mail or
overnight delivery), (c) the next Business Day after the date when sent by
recognized overnight courier, or (c) the second Business Day after the date when
sent by registered or certified mail, postage prepaid. Any party may, from time
to time, change the address at which such written notice or other documents or
demands are to be sent, by giving the other party written notice of such change
in the manner hereinabove provided.
To Borrower: Matrix Pharmaceutical, Inc.
0000 Xxxxx Xxxxxx Xxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xx. Xxx Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
With A Copy To: Xxxxxxx, Xxxxxxx & Xxxxxxxx
000 X. "X" Xxxxxx, Xxxxx 0000
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx Xxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
To Lender: ARE-4757 Nexus Centre, LLC
000 X. Xxx Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxxxxx 00000
Attention: Corporate Secretary
21
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
With A Copy to: Alexandria Real Estate Equities, Inc.
00000 Xxxx Xxxxxxxx Xxxxx, Xxxxx 000
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxx X. Xxxxxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
With A Copy To: Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
8.11 Survival of Warranties and Certain Agreements.
All agreements, indemnities, representations and warranties
made herein and in the other Loan Documents shall survive the execution and
delivery of this Agreement, the making of the Loan hereunder and the execution
and delivery of the Note. All representations and warranties made in this
Agreement or in any of the other Loan Documents shall further survive any and
all investigations and inquiries made by Lender, shall remain true, correct and
complete in all material respects and shall remain continuing obligations so
long as any portion of the Secured Obligations remains outstanding or
unsatisfied. Notwithstanding anything in this Agreement or the other Loan
Documents or implied by law to the contrary, any indemnities made by Borrower in
the Loan Documents shall survive the payment of the Loan, the satisfaction of
the Secured Obligations, and/or the termination of this Agreement or the other
Loan Documents.
8.12 Failure or Indulgence Not Waiver; Remedies Cumulative.
No failure or delay on the part of Lender or any holder of the
Note or portion thereof in the exercise of any power, right or privilege
hereunder or under the Note shall impair such power, right or privilege or be
construed to be a waiver of any default or acquiescence therein, nor shall any
single or partial exercise of any such power, right or privilege preclude other
or further exercise thereof or of any other right, power or privilege. All
rights and remedies existing under this Agreement and the other Loan Documents
are
22
separate, distinct and cumulative to, and not exclusive of, any rights or
remedies otherwise available at law or in equity. No act of Lender under any of
the Loan Documents shall be construed as an election to proceed under any one
provision to the exclusion of any other provision, notwithstanding anything in
the Loan Documents to the contrary. Borrower expressly waives all right to the
benefit of any statute of limitations and any moratorium, reinstatement,
marshaling, forbearance, extension, redemption, or appraisement now or hereafter
provided by federal or state law, as a defense to any demand against Borrower to
the fullest extent permitted by law.
8.13 Survival of Obligations Upon Termination of Agreement.
No termination or cancellation (regardless of cause or
procedure) of this Agreement or any of the other Loan Documents shall in any way
affect or impair the powers, obligations, duties, rights, and liabilities of
Borrower or Lender relating to (a) any transaction or event occurring prior to
such termination or cancellation, or (b) any of the undertakings, agreements,
covenants, indemnities, warranties and representations of Borrower or Lender
contained in this Agreement or any of the other Loan Documents.
8.14 Disbursements in Excess of Loan Amount.
In the event the total disbursements by Lender exceed the
amount of the Loan set forth herein, the total of all disbursements shall, to
the extent permitted by the laws of the State of California, constitute part of
the Secured Obligations and be secured by the Deed of Trust and other Loan
Documents. All other sums expended by Lender pursuant to this Agreement or any
of the other Loan Documents shall be deemed to have been paid to Borrower and
shall be secured by the Loan Documents.
8.15 Severability.
If any term of this Agreement or any of the other Loan
Documents or the application thereof to any person or circumstances, shall, to
any extent, be invalid or unenforceable, the remainder of this Agreement or
other Loan Document or the application of such term to persons or circumstances
other than those as to which it is invalid or unenforceable, shall not be
affected thereby, and each term of this Agreement or other Loan Document shall
be valid and enforceable to the fullest extent.
8.16 Rules of Construction.
Where the identity of the parties to this Agreement or any of
the other Loan
23
Documents or the circumstances make it appropriate, the masculine gender
includes the feminine and/or neuter, and the singular number includes the
plural. Article and Section headings in this Agreement and the other Loan
Documents are included for convenience of reference only and shall not
constitute a part of this Agreement or such other Loan Documents for any other
purpose or be given any substantive effect. The recitals to this Agreement and
to each of the other Loan Documents are incorporated herein and therein and made
a part hereof and thereof.
8.17 Applicable Law.
This Agreement and the other Loan Documents shall be governed
by, and construed and enforced in accordance with, the laws of the State of
California.
8.18 Successors and Assigns.
This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors an assigns. Except
as expressly provided in the Loan Documents (including, without limitation, the
Lease), Borrower's rights and obligations or any interest hereunder or under any
of the other Loan Documents may not be assigned, including without limitation,
assigned for security purposes, without the prior written consent of Lender
which may be withheld in Lender's sole discretion, and any such purported
assignment shall be null and void ab initio. As used herein, and in the other
Loan Documents, "Lender" (or similar references to the lender) shall include all
holders of the Note, including, without limitation, pledgees of the Note,
whether or not named herein or therein. In exercising any rights hereunder or
under any of the other Loan Documents or taking any actions provided for herein
or therein, Lender may act through its employees, agents or independent
contractors authorized by Lender.
8.19 Disclosure of Information.
Borrower hereby acknowledges and agrees that upon the request
of any partner, member or shareholder of Borrower, as applicable, Lender may
disclose to such party any information (including, without limitation, financial
information) relating to the Loan and Borrower's performance of its obligations
under the Loan Documents. Borrower hereby indemnifies and agrees to defend and
hold harmless the Indemnitees from and against any and all expenses, loss,
claims, damage or liability, including, without limitation, attorneys' fees and
costs, arising by reason of any disclosure of information by Lender under this
Section 8.19.
24
8.20 Counterparts.
This Agreement and the other Loan Documents may be executed in
any number of counterparts, each of which when so executed and delivered shall
be deemed to be an original and all of which counterparts taken together shall
constitute but one and the same instrument. Signature and, if applicable,
acknowledgment pages may be detached from the counterparts and attached to a
single copy of the applicable document to physically form one document, which
may be recorded if applicable.
8.21 Entire Agreement.
The Loan Documents set forth the entire understanding between
Borrower and Lender relative to the Loan and the same supersede all prior
agreements and understandings relating to the subject matter hereof or thereof.
8.22 Inconsistencies.
In the event it is impossible to simultaneously comply with
the terms of this Agreement and any of the terms of any other Loan Document, the
terms of this Agreement shall control over any inconsistent term of any other
Loan Document.
8.23 Time is of the Essence.
Time is strictly of the essence of this Agreement and the
other Loan Documents.
8.24 No Third Party Beneficiaries.
This Agreement and the other Loan Documents are made and
entered into for the sole protection and benefit of the parties hereto, and,
except as provided in Section 8.18, no other person or entity shall be a direct
or indirect beneficiary of, or shall have any direct or indirect cause of action
or claim in connection with, this Agreement or any of the other Loan Documents.
65535RT65535CLE 9
PUT RIGHT & OPTION
9.1 Borrower shall have the right at any time prior to the Maturity
Date, upon delivery of written evidence reasonably satisfactory to Lender,
together with such supporting
25
documentation and certificates as Lender may in its good faith discretion
require, that Borrower has completed strategic alliances or joint ventures with
a cumulative value in excess of $10,000,000, as measured by initial and
milestone payments received by Borrower from unaffiliated joint venture or
alliance partners, and provided that no Event of Default or Potential Default
exists, to cause Lender to purchase an undivided one-half interest in the
Improvements in exchange for one-half of the outstanding principal balance of
the Loan (up to $3,000,000). In the event that Borrower exercises such right,
Borrower shall, as a condition precedent to the transfer, execute and deliver to
Lender such instruments, agreements and title endorsements (including, without
limitation, deeds, assignments and other conveyance documents) as Lender may
reasonably request in order to convey good and marketable title to the
Improvements to be conveyed to Lender, together with an amendment to the Lease
in form and substance acceptable to Lender in its discretion whereby Borrower
shall lease back from Lender the Improvements so conveyed and the rent
thereunder shall be increased by $330,000 per annum, payable in the same manner
(and subject to the same adjustments) as Basic Annual Rent thereunder.
9.2 Borrower shall have right at any time subsequent to the sale of an
undivided one-half interest in the Improvements to Lender pursuant to Section
9.1 above but prior to the Maturity Date, and provided that no Event of Default
or Potential Default exists, upon delivery of written evidence reasonably
satisfactory to Lender, together with such supporting documentation and
certificates as Lender may in its good faith discretion require, that either (a)
Borrower has completed strategic alliances or joint ventures with a cumulative
value in excess of $15,000,000, as measured by initial and milestone payments
received by Borrower from unaffiliated joint venture or alliance partners, or
(b) Borrower's net sales from products for the immediately preceding fiscal year
(as reported in Borrower's most recent public filings with the Securities and
Exchange Commission) were no less than $10,000,000, to cause Lender to purchase
the remaining interest in the Improvements in exchange for the remaining
outstanding principal balance of the Loan (up to $3,000,000). In the event that
Borrower exercises such right, Borrower shall, as a condition precedent to the
transfer, execute and deliver to Lender such instruments, agreements and title
endorsements (including, without limitation, deeds, assignments and other
conveyance documents) as Lender may reasonably request in order to convey good
and marketable title to the Improvements to be conveyed to Lender, together with
an amendment to the Lease in form and substance acceptable to Lender in its
discretion whereby Borrower shall lease back from Lender the Improvements so
conveyed and the rent thereunder shall be increased by an additional $330,000
per annum, payable in the same manner (and subject to the same adjustments) as
Basic Annual Rent thereunder.
9.3 Lender shall have the right at any time prior to the Maturity Date,
upon
26
delivery of written notice to Borrower, to purchase the Improvements in exchange
for the outstanding principal balance of the Loan (up to $6,000,000). In the
event that Lender exercises such right, Borrower shall execute and deliver to
Lender such instruments, agreements and title endorsements (including, without
limitation, deeds, assignments and other conveyance documents) as Lender may
reasonably request in order to convey good and marketable title to the
Improvements to Lender, together with an amendment to the Lease in form and
substance acceptable to Lender in its discretion whereby Borrower shall lease
back from Lender the Improvements so conveyed and the rent thereunder shall be
increased by $660,000 per annum, payable in the same manner (and subject to the
same adjustments) as Basic Annual Rent thereunder.
27
IN WITNESS WHEREOF, this Agreement has been duly executed and
delivered Borrower and Lender as of the date first above written.
BORROWER:
MATRIX PHARMACEUTICAL, INC.,
a Delaware corporation
By: /s/ Xxxxxx X. Xxxxx
--------------------------------
Its: Vice President of Operations
----------------------------
By:
--------------------------------
Its:
----------------------------
LENDER:
ARE-4757 NEXUS CENTRE, LLC,
a Delaware limited liability company
By: ALEXANDRIA REAL ESTATE EQUITIES,
L.P., a Delaware limited
partnership, managing member
By: ARE-QRS CORP., a Maryland
corporation, general partner
By: /s/ Xxxxx Xxxxxx
-------------------------
Its: Chief Financial Officer
------------------------
EXHIBIT A
Description of Project
That certain real property located in the City of San Diego, County of San
Diego, State of California, having a street address of 4757 Nexus Centre Drive,
more particularly described as follows:
Parcel 1 of Parcel Map 17892 in the City and County of San Diego,
according to Map filed in the Office of the County Recorder of said
county on August 6, 1997.
X-0
XXXXXXX X-0
Manufacturing Suite Plans
B-1-1
EXHIBIT B-2
DESCRIPTION OF EXCLUDED IMPROVEMENTS AND FIXTURES
Production Equipment Design Requirements
MEP Design-TKG
MEP Design-TKG
Architectural Design-WHL
Civil Design-Latitude 33
Structural Design-Hope Eng.
Production Equipment
WFI System including tanks, pumps, valve, controls
RQ/DI Water Equipment
Air Handler Xx. 00
Xxxxxxxxxx Xxxx
Xxxx Steam Generator Drip Legs
Production Equipment Contractor Work (Labor, Overhead & Profit)
Work Performed by Contractor
Site Management
Site Requirements
Contractor Fee
Production Equipment Subcontractor Work (Installation, Material & Labor
Requirements)
Site Utilities
Doors/Frames/Hardware
Drywall/Taping & Painting
Flooring/Walls-Mipolam, VCT, Sheet Vinyl
Stainless Steel Casework
Kolpak Cold Box w/Honeywell Trueline Recorder
HVAC
Plumbing Systems
Process Utilities
Process Controls
Electrical
Production Facility Scope of Work Changes
Boroscoping
EXHIBIT C
Description of Personal Property
All of Borrower's right, title and interest, now or hereafter acquired,
in and to the following; provided, however, that none of the following shall be
construed to include any of those items of personal property listed on Exhibit
B-2 to this Agreement, or the proceeds therefrom:
(a) All personal property (including, without limitation, all goods,
supplies, equipment, furniture, furnishings, machinery and construction
materials) which Borrower now or hereafter owns or in which Borrower now or
hereafter acquires an interest or right, which are now or hereafter located on
or affixed to the Project and are used or useful in the maintenance or operation
of any of the Improvements, together with and all books, records, leases and
other documents, of whatever kind or character, relating to any of the
foregoing;
(b) All fees, income and rents which, after the date hereof and while
any portion of the Secured Obligations remains unpaid, may accrue from any of
the personal property described in paragraph (a) of this Exhibit C, or which may
be received or receivable by Borrower from any hiring, letting, leasing,
subhiring, subletting, or subleasing therefor;
(d) All other intangible property and rights relating to the
Improvements or Borrower's operation thereof, or used in connection therewith,
including but not limited to all governmental permits owned by Borrower relating
to construction of the Improvements, and all permits, licenses, franchises,
approvals and variances relating in any way to, or to the operation, ownership
and use of, the Improvements;
(e) All judgments, claims, settlements of claims and causes of action
under any legal proceeding relating to Borrower's interest in the Improvements
or Borrower's use, occupancy or operation thereof;
(f) All proceeds from sale or disposition of the Personal Property;
(g) Borrower's rights under all insurance policies covering the
Improvements or any of the Personal Property (whether or not Borrower is
required to maintain such insurance under the terms of the Loan Documents), and
all proceeds, loss payments and premium refunds payable regarding the same;
(h) All reserves, deferred payments, deposits, refunds, cost savings
and payments
C-1
of any kind relating to the construction of any Improvements;
(i) All causes of action, claims, compensation and recoveries for any
damage to or condemnation or taking of the Improvements or the Personal
Property, or for any conveyance in lieu thereof, whether direct or
consequential, or for any damage or injury to the Improvements or the Personal
Property, or for any loss or diminution in value of the Improvements or the
Personal Property;
(j) All architectural, structural, mechanical and engineering plans and
specifications prepared for construction of Improvements and all studies, data
and drawings related thereto, and all contracts and agreements of Borrower
relating to such plans and specification or such studies, data and drawings or
to the construction of Improvements;
(k) All of Borrower's present and future rights in and to all refunds,
rebates, reimbursements, reserves, deferred payments, deposits, cost savings,
governmental subsidy payments, governmental-registered credits (such as
emissions reduction credits), other credits, waivers and payments, whether in
cash or kind, due from or payable by any Governmental Agency or any insurance or
utility company relating to any or all of the Improvements or arising out of
satisfaction of any condition imposed upon or the obtaining of any approvals for
the development of the Improvements;
(l) All of Borrower's present and future rights in and to all refunds,
rebates, reimbursements, credits and payments of any kind due from or payable by
any Governmental Agency or other entity for any taxes, special taxes,
assessments, or similar governmental or quasi-governmental charges or levies
imposed upon Borrower with respect to the Improvements or arising out of the
satisfaction of any condition imposed upon or the obtaining of any approvals for
the development of the Improvements;
(m) All Borrower's rights in proceeds of the Loan;
(n) All Borrower's rights to receive the proceeds of any "take-out" or
permanent financing or commitment to provide such financing; and
All terms used herein which are defined in the California Commercial
Code shall have the same meanings when used herein, unless the context requires
otherwise.
C-2
EXHIBIT D
Form of Promissory Note
SECURED PROMISSORY NOTE
$6,000,000.00 San Diego, California
as of March __, 1998
FOR VALUE RECEIVED, MATRIX PHARMACEUTICAL, INC., a Delaware corporation
(the "Maker"), promises to pay, on or before the "Due Date" (as defined below),
to the order of ARE4-757 NEXUS CENTRE, LLC, a Delaware limited liability company
or its designee (the "Holder"), having an address at c/o Alexandria Real Estate
Equities, Inc., 000 X. Xxx Xxxxxx Xxxxxx, Xxxxx 000, Xxxxxxxx, Xxxxxxxxxx 00000,
at said address or in accordance with such other instructions or place as the
Holder may hereafter designate from time to time in writing, the principal sum
of SIX MILLION DOLLARS ($6,000,000.00) in lawful money of the United States,
with interest on the "Principal Balance" (as defined below) from the date of
this Secured Promissory Note (this "Note") to and including the date on which
this Note is paid in full, calculated in the manner hereinafter set forth.
1. As used herein, the term "Principal Balance" shall mean the
outstanding principal balance of this Note from time to time.
2. The entire Principal Balance shall bear interest at the rate of
eleven percent (11%) per annum, calculated on the basis of the actual number of
days elapsed over a 365 day year. Interest only on the Principal Balance shall
be payable monthly, in arrears, commencing on the last day of the month in which
this Note is executed and thereafter on the last business day of each month
until paid in full. All accrued and unpaid interest, and any other unpaid
charges accruing or due hereunder, shall be added to the Principal Balance on a
monthly basis.
3. The entire unpaid Principal Balance, together with all accrued and
unpaid interest thereon, shall be due and payable on the date which is four (4)
calendar years from the date of this Note (the "Due Date").
4. This Note is subject to the express condition that at no time shall
the Maker be obligated or required to pay interest on any amount outstanding
hereunder at a rate which could subject the Holder to either civil or criminal
liability as a result of such rate being in excess of the maximum rate which the
Maker is permitted by law to contract or agree to pay. If by the terms of this
Note the Maker is at any time required or obligated to pay interest on any
amount outstanding hereunder at a rate in excess of such maximum rate, the rate
of interest under this Note shall be deemed to be immediately reduced to such
maximum rate and interest payable hereunder shall be computed at such maximum
rate and the portion of all prior interest payments in excess of such maximum
rate shall be applied and shall be deemed to have been payments in reduction of
the principal amount outstanding hereunder.
5. The Maker hereby waives presentment and demand for payment, notice
of dishonor, protest and notice of protest of this Note, and agrees to pay all
costs of collection when incurred, including attorneys' fees, charges and
disbursements (which amounts shall be added to the Principal Balance). No
extension of time for payment of this Note or any installment hereunder, and no
alteration, amendment or waiver of any provision of this Note, shall release,
discharge, modify, change or affect the liability of the Maker hereunder.
6. Maker may make full or partial prepayment of the Principal Balance
together with accrued and unpaid interest thereon at any time or from time to
time without penalty or charge, upon at least 30 days' prior written notice to
Holder.
7. All payments received hereunder shall be applied first to accrued
interest, then to any due and unpaid charges incurred by Holder in connection
with this Note and thereafter to a reduction of the Principal Balance.
8. In the event of any default by Maker under the terms of this Note,
time being of the essence, Holder may, in addition to any other rights and
remedies which Holder may have hereunder, at law, in equity, pursuant to: (a)
that certain Loan and Security Agreement of even date herewith by and between
Maker and Holder (the "Loan Agreement"); (b) that certain Lease of even date
2
herewith by and between Holder, as landlord, and Maker, as tenant (the "Lease");
(c) that certain Deed of Trust and Fixture Filing of even date herewith executed
by Maker, as trustor, to Chicago Title Insurance Company, as trustee, and naming
Holder, as beneficiary, to be recorded concurrently herewith (the "Deed of
Trust"); and (d) that certain California UCC-1 Financing Statement of even date
herewith to be filed with the California Secretary of State, together with UCC-1
Financing Statements for such other States as are required by Holder
(collectively, the "Financing Statement") (the Loan Agreement, the Lease, the
Deed of Trust and the Financing Statement are herein collectively referred to as
the "Loan Documents"), or otherwise, at any time following such default, without
waiving any other rights or remedies available to it, declare the entire
Principal Balance, accrued interest and all other amounts payable under this
Note, immediately due and payable, and the entire sum shall thereby become due
and payable.
9. If any action is brought in connection with or to enforce this Note,
or if this Note is placed in the hands of an attorney or agent for collection,
Maker shall pay all costs, fees and disbursements of such action or collection,
including, without limitation, reasonable attorneys' fees, charges and
disbursements, and all such sums shall be added to and become part of the
Principal Balance as and when incurred.
10. This Note is the promissory note referred to in the Loan Agreement
and is secured by the Deed of Trust.
11. This Note and Maker's obligations hereunder and under each of the
other Loan Documents are intended to be, and shall be, recourse obligations of
Maker, and Holder shall have full recourse to Maker and all of its assets in
connection with any default hereunder or under any of the other Loan Documents.
12. The terms of this Note shall be governed by and construed under the
laws of the State of California.
13. This Note may not be amended or terminated orally, but only by an
agreement in writing executed by the Holder.
3
IN WITNESS WHEREOF, the Maker has duly executed this Note as of the
date first above written.
MAKER:
MATRIX PHARMACEUTICAL, INC.,
a Delaware corporation
By: ________________________
Name: ___________________
Its: ____________________
4
EXHIBIT "E"
Permitted Liens
EXCEPTIONS FROM COVERAGE
This policy does not insure against loss or damage (and the Company will
not pay costs, attorneys' fees or expenses) which arise by reason of:
A 1. PROPERTY TAXES, INCLUDING ANY ASSESSMENTS COLLECTED WITH TAXES, TO BE
LEVIED FOR THE FISCAL YEAR 1998-99 THAT ARE A LIEN NOT YET DUE.
B 2. THE LIEN OF SUPPLEMENTAL TAXES, IF ANY, ASSESSED PURSUANT TO THE
PROVISIONS OF CHAPTER 3.5 (COMMENCING WITH SECTION 75) OF THE REVENUE
AND TAXATION CODE OF THE STATE OF CALIFORNIA.
C 3. THE FACT THAT THE OWNERSHIP OF SAID LAND DOES NOT INCLUDE RIGHTS OF
ACCESS TO OR FROM THE STREET OR HIGHWAY ABUTTING SAID LAND, SUCH RIGHTS
HAVING BEEN SEVERED FROM SAID LAND BY THE DOCUMENT.
RECORDED: APRIL 8, 1969 AS FILE NO. 59708, OFFICIAL RECORDS
AFFECTS: IN AND TO I-805 FREEWAY, BEING A PORTION OF THE EASTERLY
BOUNDARY OF PARCEL 2 AS SHOWN ON PARCEL MAP 17892.
D 4. THE RIGHTS, AS A "RESTRICTIVE USE EASEMENT" AS RESERVED BY THE UNITED
STATES OF AMERICA IN DEED DATED JULY 21, 1983 AND RECORDED JULY 28, 1983
AS FILE NO. 83-261437.
REFERENCE IS MADE TO SAID DOCUMENT FOR FULL PARTICULARS.
THE EXACT LOCATION AND EXTENT OF SAID EASEMENT IS NOT DISCLOSED OF
RECORD.
E 5. A RESTRICTIVE USE EASEMENT IN PERPETUITY FOR THE ESTABLISHMENT,
MAINTENANCE, OPERATION AND USE OF A SAFETY AREA OF COMPATIBLE USE ZONE
IN CONNECTION WITH THE OPERATION OF THE NAVAL AIR STATION MIRAMAR AND
INCIDENTAL PURPOSES, IN FAVOR OF UNITED STATES OF AMERICA, RECORDED JULY
JULY 28, 1983 AS FILE NO. 83-261438 OF OFFICIAL RECORDS.
REFERENCE IS MADE TO SAID DOCUMENT FOR FULL PARTICULARS.
THE EXACT LOCATION AND EXTENT OF SAID EASEMENT IS NOT DISCLOSED OF
RECORD.
F 6. COVENANTS, CONDITIONS AND RESTRICTIONS (BUT OMITTING ANY COVENANT OR
RESTRICTIONS BASED ON RACE, COLOR, RELIGION, SEX, HANDICAP, FAMILIAL
STATUS, OR NATIONAL ORIGIN) AS SET FORTH IN THE DOCUMENT.
RECORDED: JULY 28, 1983 AS FILE NO. 83-261430, OFFICIAL RECORDS
G 7. PLANNING DIRECTOR RESOLUTION NO. 7493 PD GRANTING PLANNED INDUSTRIAL
DEVELOPMENT PERMIT NO. 87-1049 AMENDMENT TO PID PERMIT NO. 86-0967.
RECORDED JUNE 14, 1988 AS FILE NO. 88-283002.
H 8. AN OFFER OF DEDICATION TO PUBLIC USE OF, A PORTION OF SAID LAND, SAID
OFFER WAS REJECTED ON SAID MAP, BUT IS SUBJECT TO FUTURE ACCEPTANCE
UNDER THE PROVISIONS OF SECTION NUMBER 66477.2 OF THE GOVERNMENT CODE OF
THE STATE OF CALIFORNIA.
DESIGNATED ON
MAP NO.: 12473
AS: RESERVED FOR FUTURE STREET
AFFECTS: A PORTION OF PARCEL 2 AS SHOWN ON PARCEL MAP 17892
I 9. AN EASEMENT FOR THE PURPOSE SHOWN BELOW AND RIGHTS INCIDENTAL THERETO AS
SHOWN ON MAP OF SAID TRACT.
EASEMENT
PURPOSE: SEWER, DRAINAGE, SLOPE
AFFECTS: AS SHOWN ON SAID MAP NO. 12473
NOTE: A PORTION OF SAID EASEMENT WAS ABANDONED ON PARCEL MAP 17892.
J 10. AN EASEMENT FOR THE PURPOSE SHOWN BELOW AND RIGHTS INCIDENTAL THERETO AS
SET FORTH IN A DOCUMENT
GRANTED TO: SAN DIEGO GAS & ELECTRIC COMPANY
PURPOSE: PUBLIC UTILITIES, INGRESS AND EGRESS
RECORDED: DECEMBER 27, 1989 AS FILE NO. 89-699805, OFFICIAL
RECORDS
AFFECTS: THE EXACT LOCATION AND EXTENT OF SAID EASEMENT IS
NOT DISCLOSED OF RECORD.
K RESTRICTIONS ON THE USE, BY THE OWNERS OF SAID LAND, OF THE EASEMENT
AREA AS PROVIDED IN THE DOCUMENT REFERRED TO ABOVE.
N 11. AN AGREEMENT BETWEEN THE CITY OF SAN DIEGO AND NEXUS CENTRE/I-805, A
CALIFORNIA LIMITED PARTNERSHIP, OWNER, RECORDED FEBRUARY 20, 1992 AS
FILE NO. 00-0000000, OFFICIAL RECORDS, RELATING TO THE INSTALLATION,
MAINTENANCE AND POSSIBLE REMOVAL OF 6" PRIVATE SEWER LATERAL AND 12"
PRIVATE DRAINAGE PIPE.
N 12. PROVISIONS, HEREIN RECITED, OF THE DEDICATION STATEMENT ON THE
MAP NO: PARCEL MAP 16892 AND 17892
PROVISIONS: THIS IS A MAP OF A PLANNED INDUSTRIAL DEVELOPMENT
PROJECT AS DEFINED IN CHAPTER X, ARTICLE I, DIVISION
9 OF THE SAN DIEGO MUNICIPAL CODE.
Exhibit "E" (Continued)
O 13. A PENDING ASSESSMENT FOR THE DISTRICT SHOWN BELOW. WHEN NOTICE OF THE
ASSESSMENT IS RECORDED WITH THE COUNTY RECORDER THE ASSESSMENT SHALL
BECOME A LIEN ON SAID LAND.
DISTRICT: DISTRICT DIAGRAM OF NORTH UNIVERSITY CITY AMENDED DISTRICT
DIAGRAM FACILITIES BENEFIT ASSESSMENT IN THE CITY OF SAN DIEGO,
COUNTY OF SAN DIEGO, STATE OF CALIFORNIA
DISCLOSED BY: ASSESSMENT DISTRICT DIAGRAM AMENDED
RECORDED: AUGUST 9, 1994 AS FILE NO. 1994-0485272, OFFICIAL
RECORDS
P NOTICE OF ASSESSMENT RECORDED OCTOBER 1, 1991 AS FILE NO. 1991-506423
AS AUGUST 9, 1994 AS FILE NO. 1994-0485273, OFFICIAL RECORDS
Q 14. AN EASEMENT FOR THE PURPOSE SHOWN BELOW AND RIGHTS INCIDENTAL THERETO
AS SET FORTH IN A DOCUMENT
GRANTED TO: CITY OF SAN DIEGO
PURPOSE: TUNNEL OR TUNNELS FOR UTILITY PURPOSES
RECORDED: MARCH 3, 1995 AS FILE NO. 1995-0093861, OFFICIAL
RECORDS
AFFECTS: THE ROUTE THEREOF AFFECTS A PORTION OF SAID LAND AND
IS MORE FULLY DESCRIBED IN SAID DOCUMENT.
R 15. AN AGREEMENT BETWEEN THE CITY OF SAN DIEGO AND MATRIX PHARMACEUTICAL,
INC., A DELAWARE CORPORATION, OWNER, RECORDED APRIL 24, 1997 AS FILE
NO. 1997-0189196 OF OFFICIAL RECORDS. RELATING TO THE INSTALLATION,
MAINTENANCE AND POSSIBLE REMOVAL OF TRASH ENCLOSURE, WATER SERVICE,
PAVEMENT AND LANDSCAPING.
S 16. ANY RIGHTS, INTEREST, OR CLAIMS WHICH MAY EXIST OR ARISE BY REASON OF
THE FOLLOWING FACTS.
A) IMPROVEMENTS LIE WITHIN THE RESTRICTIVE USE EASEMENT RECORDED JULY
21, 1983 AS FILE NO. 83-261437.
B) A BUILDING, CURBS, DECORATIVE CONCRETE, WALLS & STAIRS ENCROACH ONTO
THE EASEMENT FOR WATER, SEWER, DRAINAGE AND SLOPE SHOWN ON MAP 12473.
T 17. AN EASEMENT FOR THE PURPOSE SHOWN BELOW AND RIGHTS INCIDENTAL
THERETO AS SHOWN OR AS OFFERED FOR DEDICATION ON THE RECORDED MAP SHOWN
BELOW.
MAP NO: PARCEL MAP 17892 EASEMENT
PURPOSE: 24' WIDE WATER EASEMENT
AFFECTS: AS SHOWN ON SAID MAP
Exhibit "E" (Continued)
AB 19. AN UNRECORDED LEASE AFFECTING THE PREMISES HEREIN DESCRIBED, EXECUTED
BY AND BETWEEN THE PARTIES HEREIN NAMED, WITH CERTAIN TERMS, COVENANTS,
CONDITIONS AND PROVISIONS SET FORTH THEREIN.
LESSOR: ARE-4757 NEXUS CENTRE, LLC
LESSEE: MATRIX PHARMACEUTICAL, INC.
DISCLOSED BY: MEMORANDOM OF LEASE (PARKING LEASE)
RECORDED: ----
AC 21. A DOCUMENT ENTITLED "DECLARATION OF RECIPROCAL EASEMENTS,"
DATED-EXECUTED BY MATRIX PHARMACEUTICAL, INC., SUBJECT TO ALL THE
TERMS, PROVISIONS AND CONDITIONS THEREIN CONTAINED, RECORDED-.
Exhibit "E" (Continued)
