EXHIBIT10.43

 

THIRD MODIFICATION TO COMMERCIAL PROMISSORY

NOTE AND LOAN AND SECURITY AGREEMENT

 

THIS THIRD MODIFICATION TO COMMERCIAL PROMISSORY NOTE AND LOAN AND SECURITY
AGREEMENT (“Modification”) is made and entered into as of this 30th day of
January, 2004 by and between SALIX PHARMACEUTICALS, LTD., a Delaware corporation
and SALIX PHARMACEUTICALS, INC., a California corporation (collectively, jointly
and severally, “Borrower”) and RBC CENTURA BANK (“Bank”).

 

RECITALS

 

Bank made a loan to Borrower pursuant to the terms of a Commercial Promissory
Note dated September 30, 2002 in the original principal amount of up to Seven
Million Dollars ($7,000,000.00) (with all amendments and modifications thereto,
the “Note”) and a Loan and Security Agreement dated September 30, 2002 (with all
amendments and modifications thereto, the “Loan Agreement”; and with the Note
and all other instruments, documents and agreements delivered in connection with
the Note or Loan Agreement, or securing the same, and all amendments and
modifications thereto, collectively the “Loan Documents”). Borrower has
requested Bank extend the current term of the Loan made pursuant to the Loan
Documents, and to modify certain covenants within this Loan Agreement, and Bank
has agreed to do so as set forth below.

 

NOW, THEREFORE, for and in consideration of the mutual promises herein
contained, and other good and valuable consideration, the receipt and
independent sufficiency of which are hereby acknowledged, the parties agree as
follows:

 

1. Incorporation of Recitals. The foregoing Recitals are hereby incorporated in
this Modification.

 

2. Modification to Note; Conforming Modification of Loan Agreement. The Maturity
Date is hereby extended until January 31, 2005, and in connection therewith,
Section 2.1 of the Note is hereby deleted in its entirety, and a new Section 2.1
is inserted in lieu thereof, reading as follows:

 

“Section 2.1 Interest Payment Terms. Interest shall be payable monthly, in
arrears, beginning October 10, 2002 and continuing on the same calendar day of
each consecutive month thereafter until January 31, 2005 (the “Maturity Date”),
when all accrued but unpaid interest is due and payable in full.”

 

In furtherance thereof, the “Revolving Maturity Date”, as defined in Exhibit A
to the Loan Agreement is hereby modified to be and mean January 31, 2005.

 

3. Modification to Loan Agreement. The “Maximum Quarterly Loss” financial
covenant contained in the Loan Agreement is hereby removed, and in connection
therewith, Section 6.9(b) of the Loan Agreement is hereby deleted in its
entirety.

 

4. Fees and Expenses. Bank’s agreement to extend the Maturity Date of the Note
and to make the foregoing modifications and amendments is subject in all
respects to Borrower’s payment of a modification/renewal fee of Eight Thousand
Five Hundred Dollars ($8,500.00), and all costs and expenses incurred or
suffered by Bank in connection with this Agreement, including, without
limitation, attorneys’ fees.

 

5. Effect of Modification. Nothing contained in this Modification shall in any
way waive, annul, vary and affect any provision, condition, covenant and
agreement contained in the Note and other Loan Documents, except as specifically
modified herein, nor affect and impair any rights, powers and remedies under the
Loan Documents. The Note, as modified by this Modification, and the other Loan
Documents contain the entire agreement of the parties hereto and the undersigned
does hereby ratify, confirm and reaffirm the terms of, and their respective
agreements, obligations and duties under, each of the Note, Loan Agreement and
other Loan Documents, all of which shall remain in full force and effect, as
modified herein. This Modification shall be binding upon any assignee and
successor in interest of the parties hereto, and Borrower waives and will not
assert against any transferee and assignee of Bank any claims, defenses,
set-offs and rights of recoupment which Borrower could assert against Bank,
except defenses which Borrower cannot waive.

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6. Miscellaneous. This Modification shall be deemed to have been executed and
delivered in North Carolina regardless of where the signatories may be located
at the time of execution and shall be governed by and construed in accordance
with the substantive laws of the State of North Carolina, excluding, however,
the conflict of law provisions thereof. This Modification may be executed in any
number of counterparts with the same effect as if all parties hereto had signed
the same document. All such counterparts shall be construed together and shall
constitute one instrument, but in making proof hereof it shall only be necessary
to produce one such counterpart. It is the intention of the parties that this
Modification and the Note, the other Loan Documents, and any other commitment
letters, documents or agreements related to or entered into in connection with
the Loan Documents (or any of them), be interpreted in a consistent manner;
provided, however, in the event of any irreconcilable conflict in the provisions
of this Modification and the provisions of any of the Loan Documents, the
provisions of this Modification shall control.

 

IN WITNESS WHEREOF, the parties have caused this Modification to be executed
with authority duly obtained, as of the date first written above.

 

SALIX PHARMACEUTICALS, LTD., a Delaware corporation

By:

 

/s/ Adam C. Derbyshire

   

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Print Name:

 

Adam C. Derbyshire

Title:

 

Sr. Vice President, Finance and Administration and CFO

SALIX PHARMACEUTICALS, INC., a California corporation

By:

 

/s/ Adam C. Derbyshire

   

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Print Name:

 

Adam C. Derbyshire

Title:

 

Sr. Vice President, Finance and Administration and CFO

RBC CENTURA BANK

By:

 

/s/ Win Bear

   

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Print Name:

 

Win Bear

Title:

 

Senior Account Manager

 

 

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