Contract
Exhibit
10.4
Execution
Copy
THIS NOTE
HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“ACT”), OR APPLICABLE STATE SECURITIES LAWS. IT MAY NOT BE SOLD,
OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS OR
EVIDENCE REASONABLY SATISFACTORY TO THE BORROWER THAT SUCH REGISTRATION IS NOT
REQUIRED. THE SECURITIES ISSUED UPON SUCH CONVERSION MAY NOT BE SOLD,
OFFERED FOR SALE, PLEDGED, OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE ACT OR APPLICABLE STATE SECURITIES LAWS OR
EVIDENCE REASONABLY SATISFACTORY TO THE BORROWER THAT SUCH REGISTRATION IS NOT
REQUIRED.
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Montvale,
New Jersey
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$____________
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February
__, 2009
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FOR VALUE
RECEIVED, Synvista Therapeutics, Inc., a Delaware corporation (the “Borrower”), located at 000
Xxxx Xxxxx Xxxxxx, Xxxxxxxx, XX 00000, hereby promises to pay to
_______________________ (the “Lender”), located at
____________________________________________, or at such other place as the
Lender may from time to time reasonably designate, the principal sum of
______________________ ($___________) (the “Principal Amount”) in lawful
money of the United States, in immediately available funds, ON DEMAND, on or
after ____, 2012 (the “Maturity
Date”).
1. Interest
shall accrue at a rate per annum equal to one and one-quarter percent (1.25%)
from the date hereof until maturity (whether by demand on or after the Maturity
Date or by acceleration). Such interest shall be payable in cash at
maturity. In no event shall the rate of interest hereunder exceed the
maximum interest rate permitted by applicable law.
2. This
Note is one of several notes (the “Notes”) in the aggregate
principal amount of up to $______ and of like tenor issued by the Borrower to
the Lender and others (together, the “Lenders”) pursuant to the
terms of that certain Note Purchase Agreement, dated February __, 2009, as
amended (the “Purchase
Agreement”). By acceptance of this Note, the Lender hereby
agrees that each of the Notes issued pursuant to the Purchase Agreement shall
rank equally and ratably without priority over one another, and the Borrower
agrees that, except as expressly provided by the terms of the Notes, none of the
Notes shall be paid, in whole or in part, unless an equivalent, pro rata payment
is made with respect to all other Notes.
3. As
security for the payment, performance and observance of the obligations set
forth in this Note, the Borrower has granted a security interest in its assets
to the collateral agent named in, and pursuant to, that certain Security
Agreement, dated _______, 2009 (the “Security Agreement”) and that
certain Intellectual Property Security Agreement, dated _______, 2009 (the
“IP Security Agreement” and
together with the Security Agreement, the “Security
Agreements”). Borrower hereby acknowledges and agrees that the
performance and observance of the obligations set forth in this Note by the
Borrower shall be deemed to be “Obligations” for purposes of the Security
Agreements.
4. The
Borrower may prepay the principal balance of this Note plus accrued but unpaid
interest, without penalty, at any time prior to the Maturity Date, provided that
(a) at the date of prepayment there is no Event of Default (as defined below)
existing under this Note, and (b) following the prepayment, the Company will
have a minimum cash balance of the greater of (i) one year of anticipated cash
expenditures for the Company, as determined by the Company’s Board of Directors,
or (ii) $7,500,000.
5. If
(a) the Borrower fails to make any payment under this Note; (b) the Borrower
breaches any representation, warranty, covenant or agreement in the Purchase
Agreement or any other Transaction Document (as defined in the Purchase
Agreement), (c) the Borrower fails to pay when due any Indebtedness (as defined
in the Purchase Agreement) of the Borrower in an aggregate amount of One Hundred
Thousand Dollars ($100,000) or greater at any one time; (d) a final judgment or
judgments for the payment of money aggregating in excess of One Hundred Thousand
Dollars ($100,000) are rendered against the Borrower and which judgments are
not, within sixty (60) days after the entry thereof, bonded, discharged or
stayed pending appeal, or are not discharged within sixty (60) days after the
expiration of such stay; (e) the Borrower shall be dissolved, become insolvent
(however defined or evidenced), make an assignment for the benefit of creditors
or make or send a notice of intended bulk transfer; (f) any petition or
proceeding for any relief under any bankruptcy, reorganization, arrangement,
insolvency, readjustment of debt, receivership, liquidation or dissolution law
or statute now or hereinafter in effect (whether at law or in equity) is filed
or commenced by the Borrower; or (g) any trustee or receiver is appointed for
the Borrower or any property of the Borrower, a meeting of creditors is convened
or a committee of creditors is appointed for, or any petition or proceeding for
any relief under any bankruptcy, reorganization, arrangement, insolvency,
readjustment of debt, receivership, liquidation or dissolution law or statute
now or hereinafter in effect (whether at law or in equity) is filed or commenced
against the Borrower, which proceeding is not dismissed within thirty (30) days
(each of the foregoing, an “Event of Default”), then and
in any such event and at any time thereafter, the Lender may, at its option,
declare all amounts owing under Section 11 of this Note to be due and payable,
whereupon the maturity of the unpaid balance hereof shall be accelerated and the
principal, together with all unpaid interest accrued thereon, shall forthwith
become due and payable; provided, that, if
any petition or proceeding for any relief under any bankruptcy, reorganization,
arrangement, insolvency, readjustment or debt, receivership, liquidation or
dissolution law or statute now or hereinafter in effect (whether at law or in
equity) is filed or commenced by the Borrower, all amounts owing under this Note
shall be, without notice, declaration or any action by the Lender, accelerated,
and immediately due and payable.
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6. The
Borrower hereby waives diligence, demand, presentment, protest and notice of any
kind, and assents to extensions of time of payment, release, surrender or
substitution or security, or forbearance or other indulgence, without
notice.
7. No
act, omission or delay by the Lender or course of dealing between the Lender and
the Borrower shall constitute a waiver of the rights and remedies of the Lender
hereunder. No single or partial waiver by the Lender of any
Event of Default or right or remedy which it may have shall operate as a waiver
of any other Event of Default, right or remedy or of the same Event of Default,
right or remedy on a future occasion.
8. Unless
otherwise provided herein or in the Purchase Agreement, any notice or other
communication herein required or permitted to be given shall be in writing and
may be personally served, telecopied, telexed or sent by United States mail, to
Borrower or Lender, as the case may be, addressed to it at the respective
address set forth on the first page of this Note and in the Purchase Agreement,
or at such other address as shall be designated by Borrower or Lender, as the
case may be, in a written notice to the other party complying as to delivery
with the terms of this Section 8. All such notices and other
communications shall be deemed to have been given when (i) delivered by hand,
(ii) sent by overnight courier, with receipt acknowledgment, or
(iii) sent by certified mail, return receipt requested, postage
prepaid.
9. This
Note shall be governed by and construed in accordance with the internal law of
the State of New York (without giving effect to the conflict of laws principles
thereof). Any legal action or proceeding with respect to this Note
shall be brought in the courts of the State of New York or of the United States
of America for the Southern District of New York, and, by execution and delivery
of this Note, the Borrower hereby accepts for itself and in respect of its
property, generally and unconditionally, the jurisdiction of the aforesaid
courts.
10. No
provision hereof shall be modified, altered or limited except by a written
instrument expressly executed by the Borrower and Xxxxxxx holding a majority in
principal amount of the then outstanding Notes.
11. In
the event that any court of competent jurisdiction shall determine that any
provision, or any portion thereof, contained in this Note shall be unreasonable
or unenforceable in any respect, then such provision shall be deemed limited to
the extent that such court deems it reasonable and enforceable, and as so
limited shall remain in full force and effect. In the event that such
court shall deem any such provision, or portion thereof, wholly unenforceable,
the remaining provisions of this Note shall nevertheless remain in full force
and effect.
12. This
Note and all obligations evidenced hereby shall be binding upon the heirs,
executors, administrators, successors and assigns of the Borrower and shall,
together with the rights and remedies of the Lender hereunder, inure to the
benefit of the Lender, its successors, endorsees and permitted
assigns.
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IN WITNESS WHEREOF, the Borrower has
caused this Note to be executed by its duly elected officer as of the date first
set forth above.
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By:
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Name:
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Xxxx
Xxxxxxxxx, M.D., Ph.D.
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Title:
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President
and Chief Executive
Officer
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