exv10w1



 





Exhibit 10.1




SECOND AMENDMENT TO CREDIT AND SECURITY AGREEMENT 




     This Second Amendment to Credit and Security Agreement (“Amendment”) is made as of this
6th day of November, 2007, by and among OREXIGEN THERAPEUTICS, INC., a Delaware
corporation (the “Borrower”), those financial institutions listed on the signature pages hereto as
the “Lenders” party to the Credit Agreement referenced below and MERRILL LYNCH CAPITAL, a division
of Merrill Lynch Business Financial Services Inc., as “Administrative Agent” under the Credit
Agreement referenced below.



BACKGROUND




     A. Borrower, Lenders and Administrative Agent are party to that certain Credit and Security
Agreement dated as of December 15, 2006 (as it may heretofore have been and may hereafter be
amended, modified, extended, supplemented, restated or replaced, the “Credit Agreement”) among
Borrower and any other persons from time to time party thereto as a “Borrower”, Lenders and any
other financial institutions or other entities from time to time party thereto as “Lenders” and
Administrative Agent. All capitalized terms used herein and not defined herein shall have the
meaning ascribed to such term in the Credit Agreement. Pursuant to the Credit Agreement, Lenders
extended a certain Term Loan to Borrowers as more particularly described therein. The Credit
Agreement, all Financing Documents and all instruments, documents, and agreements related thereto
or executed in connection therewith, together with all amendments, restatements, modifications,
extensions, consolidations and substitutions, are sometimes referred to herein collectively as the
“Existing Loan Documents.”



     B. Borrower has requested that Lenders agree to certain modifications and amendments to the
provisions of the Credit Agreement, including among other things an increase in the total amount
available for advances under the Term Loan, and Lenders have agreed to grant such requests on and
subject to the conditions and terms provided for in this Amendment.



     NOW THEREFORE, with the foregoing Background deemed incorporated by reference in this
Amendment and for good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto, intending to be legally bound, covenant and agree as follows:



     1. AMENDMENTS.



          (a) Term Loan Increase. As of the date hereof, immediately prior to giving effect to
this Amendment, Borrower has requested and received advance(s) under the Term Loan totaling
$10,000,000 and the total amount available for additional advances under the Term Loan pursuant to
the Term Loan Commitment of $17,000,000 hereof is $7,000,0000. Upon the effectiveness of this
Amendment, Administrative Agent and Lenders shall reset the Term Loan by making available to
Borrower additional availability for advances under the Term Loan in the principal amount of
$8,000,000 (the “Term Loan Increase”) and thereby increasing the total Term Loan Commitment from
$17,000,000 to $25,000,000 and increasing the total amount available for additional advances under
the Term Loan from $7,000,000 to $15,000,000 (the “Unfunded Term Loan Balance”). The outstanding
principal balance of the Term Loan as of the date hereof is
$8,055,555.54 (“Existing Funded Term
Loan”). Subject to the terms and conditions of the Credit Agreement, Borrower may request that
advances under the Term Loan be made to Borrower in respect of the Unfunded Term Loan Balance only
as follows: (i) Borrower shall be obligated to request an advance of $8,000,000 of the Unfunded
Term Loan Balance to be made on or before December 31, 2007 (“First Tranche”) and (ii) Borrower may
request an advance of $7,000,000 (subject to reduction in accordance with the following proviso) to
be made at any time concurrently with or after the making of the First Tranche but not later than
December 31, 2008 (the “Second Tranche”); provided that the total amount available to
Borrower to be borrowed under the Second Tranche (and the corresponding amounts of the Term Loan
Commitment and the Unfunded Term Loan Balance) shall be reduced by $6,481.48 per day commencing on
July 1, 2008. Notwithstanding anything to the contrary contained in Credit Agreement, no advances
under the Term Loan shall be made
after December 31, 2008, and any portion of the Term Loan Commitment not funded as of the
close of




 









 




business on December 31, 2008 shall thereupon automatically be terminated and the Term
Loan Commitment Amount of each Lender as of such date shall be reduced by such Lender’s Pro Rata
Share of such total reduction in the Term Loan Commitment. Without limiting the generality of
anything contained in Section 2.1(a)(i) of the Credit Agreement, each Lender’s obligation to fund
the First Tranche and the Second Tranche shall be limited to such Lender’s Term Loan Commitment
Percentage of each such advance, and no Lender shall have any obligation to fund any portion of
either the First Tranche or the Second Tranche required to be funded by any other Lender, but not
so funded.




          (b) New Definitions. The following new definition shall be added to Section 1.1 of
the Credit Agreement in the appropriate alphabetical place:





“Second Amendment” means that certain Second Amendment dated as
of November 6, 2007 by and among Borrowers, Administrative Agent
and Lenders.



          (c) Amended Definitions.




               (i) The following definitions contained in Section 1.1 of the Credit Agreement are hereby
amended and restated in their entirety as follows:




“Commitment Expiry Date” means the earlier of (a) the date that is
thirty-six (36) months after the first day of the first full
calendar month following the last funding of any portion of the
Term Loan or (b) July 1, 2011.




“Permitted Indebtedness” means: (a) Borrowers’ Debt to
Administrative Agent and each Lender under this Agreement and the
other Financing Documents; (b) Debt incurred as a result of
endorsing negotiable instruments received in the Ordinary Course
of Business; (c) purchase money Debt not to exceed $100,000 at any
time (whether in the form of a loan or a lease) used solely to
acquire equipment used in the Ordinary Course of Business and
secured only by such equipment; (d) Debt existing on the date of
this Agreement and described on Schedule 5.1 (but not including
any refinancings, extensions, increases or amendments to such Debt
other than extensions of the maturity thereof without any other
change in terms); (e) Debt owing from Principal Borrower to
Silicon Valley Bank consisting of reimbursement obligations for
one or more letters of credit with a combined outstanding undrawn
face amount not to exceed $1,000,000 in the aggregate at any time
issued by Silicon Valley Bank for the account of Principal
Borrower in favor of the landlord for Primary Borrower’s lease of
office space located at 3344 North Torrey Pines Court, San Diego,
California 92037; (f) additional Debt owing from Principal
Borrower to Silicon Valley Bank consisting of reimbursement
obligations for additional letter(s) of credit and other cash
management obligations not to exceed $250,000 at any one time; and
(g) trade accounts payable arising and paid on a timely basis and
in the Ordinary Course of Business.




“Term Loan Commitment” means the sum of each Lender’s Term Loan
Commitment Amount, which is equal to $25,000,000.



               (ii) The definition of Permitted Liens is hereby amended by adding the following new clause
(k) to the end thereof:



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(k) Liens in the deposit account(s) of Borrowers maintained at
Silicon Valley Bank (and any cash, moneys or funds on deposit
therein from time to time) securing any Debt owing to Silicon
Valley Bank described in and permitted under clauses (e) and (f)
of the definition of Permitted Indebtedness.



(d) Exit Fee. Section 2.2(f) of the Credit Agreement is hereby amended and restated
in its entirety as follows:





(f) Exit Fee. Upon repayment of the Term Loan in full for
any reason and at any time (whether by voluntary prepayment by
Borrowers, by reason of the occurrence of an Event of Default,
upon the maturity of the Term Loan, or otherwise), Borrowers shall
pay to Administrative Agent for the benefit of all Lenders
committed to make Term Loan advances, as compensation for the
costs of making funds available to Borrowers under this Agreement,
an exit fee (the “Exit Fee”) calculated in accordance with this
subsection. The total Exit Fee due under this Agreement shall be
equal to the greater of (x) an amount equal to (1) the total
aggregate original principal amount of all advances under the Term
Loan requested by Borrowers and funded by Lenders under Section
2.1(a) above multiplied by (2) five percent (5.00%) or (y)
$900,000. All fees payable pursuant to this paragraph shall be
deemed fully earned and non-refundable as of the Closing Date.
Notwithstanding anything to the contrary provided for in the
foregoing or otherwise in this Agreement, in the event that
Borrowers shall fail to request an advance under the Term Loan in
the amount of $8,000,000 representing the First Tranche (as
defined in the Second Amendment) on or before 2:00 PM (Chicago
time) on December 27, 2007, then for purposes of calculating the
total Exit Fee due under this Agreement pursuant to this Section
2.2(f), Borrowers shall be deemed to have requested such an
advance under the Term Loan in such amount be made on December 31,
2007 and then to have immediately repaid such advance on such
December 31, 2007.



(e) Prepayment Fee. Section 2.2(g) of the Credit Agreement is hereby amended by
adding the following new sentence to the end thereof:





Notwithstanding anything to the contrary provided for in the
foregoing or otherwise in this Agreement, in the event that
Borrowers shall fail to request an advance under the Term Loan in
the amount of $8,000,000 representing the First Tranche (as
defined in the Second Amendment) on or before 2:00 PM (Chicago
time) on December 27, 2007, then for purposes of this Section
2.2(g), Borrowers shall be deemed to have requested and received
such an advance under the Term Loan in such amount on December 31,
2007 and then to have immediately repaid such advance on such
December 31, 2007, and in such case, a Prepayment Fee in the
amount of $240,000 shall become automatically due and payable, and
be fully earned and non-refundable, on and as of December 31,
2007.



(f) Financial Statement Delivery Requirements. Section 4.1 of the Credit Agreement is
herby amended by adding the following new sentence to the end thereof:





Borrowers’ obligations to deliver to Administrative Agent the
quarterly financial statements and related documents as provided
for



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in clause (1) above and the annual financial statements and
related documents as provided for in clause (2) above will be
deemed to have been satisfied if within the time period otherwise
required pursuant to such clause (1) or (2) (as applicable),
Borrowers have filed Borrowers’ quarterly 10-Q report or annual
10-K report (as applicable) with the SEC containing the financial
statements and/or other information required pursuant to such
clause (1) or (2) (as applicable) and such report is publicly
available through the SEC’s “EDGAR” site maintained
atwww.sec.gov
(or, if applicable, another other public website maintained by
the SEC) and/or through the Borrowers’ public website maintained
atwww.orexigen.com (or, if applicable, any additional and/or
replacement or successor public website maintained by Borrowers of
which Borrowers have given written notice to Administrative
Agent). Borrowers’ obligations to deliver to Administrative Agent
the copies of all reports and other filings made by Borrowers with
any stock exchange on which any securities of any Borrower are
traded and/or the SEC as provided for in clause (4) above (but not
Borrower’s obligations under such clause (4) with respect to any
statements, reports or notices made available to Borrowers’
security holders that are not disclosed in or part of such a
report or other filing with such a stock exchange or the SEC) will
be deemed to have been satisfied if Borrowers give notice to
Administrative Agent via any method reasonably acceptable to
Administrative Agent (including by email sent to Administrative
Agent at “colleen_sullivan@ml.com” or at such other email address
as Administrative Agent may designate to Borrowers in writing or
by email in accordance with the notice provisions of this
Agreement) within five (5) days of the filing of the relevant
report or filing with the applicable stock exchange or the SEC in
a manner acceptable to and agreed by Administrative Agent
(including by email or telephone if so agreed by Administrative
Agent) that (i) Borrowers have filed such report or other filing
with the applicable stock exchange and/or the SEC and (ii) such
report or other filing is publicly available through a website
maintained by the applicable stock exchange and/or the SEC (such
as the SEC’s “EDGAR” site maintained at
www.sec.gov) and/or
through the Borrowers’ public website maintained at
www.orexigen.com (or, if applicable, any additional and/or
replacement or successor public website maintained by Borrowers of
which Borrowers have given written notice to Administrative
Agent); provided that, notwithstanding anything to the
contrary contained in the foregoing, no Default or Event of
Default shall be deemed to occur due to a failure of Borrowers to
give notice to Administrative Agent of the filing of any such
report or other filing within such five (5) day period if
Administrative Agent shall have otherwise obtained actual
knowledge of the event, occurrence or other circumstances
described in such report or other filing within such time period
(whether such knowledge was obtained from Borrowers or otherwise).



(g) Amortization Schedules (Schedule 2.1). Schedule 2.1 attached to the
Credit Agreement shall be amended and restated in its entirety and replaced with the new
Schedule 2.1 attached as Exhibit A to this Amendment.




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          (h) Commitment Annex (Annex A). Annex A attached to the Credit Agreement
shall be amended and restated in its entirety and replaced with the new Annex A attached as
Exhibit B to this Amendment.




     2. EFFECTIVENESS CONDITIONS. This Amendment is conditioned upon the satisfaction of
each of the conditions (“Effectiveness Conditions”) set forth below (as determined by
Administrative Agent in its reasonable discretion):



          (a) Execution and delivery of this Amendment by the parties hereto;




          (b) Execution and delivery of an Amended and Restated Term Note by Borrower in the original
principal amount of $25,000,000 (the “Note”);




          (c) Delivery by Borrower of certified copies of resolutions of Borrower’s board of directors
authorizing the execution of this Amendment and the Note and performance by Borrower of its
obligations hereunder;




          (d) Payment by Borrower to Administrative Agent, for the ratable benefit of Lenders, of a
nonrefundable amendment fee in an amount equal to $40,000 in immediately available funds, which
amendment fee shall be fully earned by Lenders upon the effectiveness of this Amendment; and




          (e) Payment by Borrower to Administrative Agent of any and all costs, fees and expenses of
Lenders and Administrative Agent, including reasonable attorneys’ fees, in connection with this
Amendment and the transactions contemplated hereby.




     3. REPRESENTATIONS AND WARRANTIES. Borrower represents, warrants and acknowledges to
Administrative Agent and Lenders as follows:



          (a) The execution, delivery and performance by Borrower of this Amendment and the Note are
within its corporate powers and have been duly authorized by all necessary action pursuant to its
Organizational Documents, require no further action by or in respect of, or filing with, any
Governmental Authority and do not violate, conflict with, cause a breach or a default under or
result in the imposition of any Lien on any of the property of Borrower pursuant to (a) any Law
applicable to Borrower or any of its Organizational Documents, or (b) any agreement or instrument
binding upon Borrower or by which Borrower’s property is bound , except for such violations,
conflicts, breaches or defaults as could not, with respect to this clause (b), reasonably be
expected to have a Material Adverse Effect. This Amendment has been duly executed and delivered by
Borrower and constitutes a legal, valid and binding obligation of Borrower, enforceable against
Borrower in accordance with its terms, except as the enforceability thereof may be limited by
bankruptcy, insolvency or other similar laws relating to the enforcement of creditors’ rights
generally and by general equitable principles; and




          (b) No Default or Event of Default exists or has occurred and is continuing as of the date of
this Amendment.




     4. REAFFIRMATION OF EXISTING LOAN DOCUMENTS AND EXISTING LIENS. Borrower hereby
confirms and ratifies in all respects the Existing Loan Documents and the Obligations outstanding
thereunder, and acknowledges that the Existing Loan Documents shall continue in full force and
effect as therein written except as amended or modified hereby and that no claims, counterclaims,
offsets or defenses arising out of or with respect to the Existing Loan Documents or the
outstanding Obligations exist. All references to the Credit Agreement in any Financing Document
shall mean the Credit Agreement as modified by this Amendment. Borrower hereby confirms and
restates its existing grant to Administrative Agent for the benefit of Administrative Agent and
Lenders of all Liens in the Collateral as provided for in the Credit Agreement, the other Security
Documents and the other Existing Loan Documents. Borrower hereby confirms that all Liens at any
time granted by it to



5









 







Administrative Agent for the benefit of Administrative Agent and Lenders continue and shall
continue in full force and effect and do and shall continue to secure the Obligations, including
any additional advances made pursuant to this Amendment, so long as any such Obligations remain
outstanding and that all Collateral subject thereto remain free and clear of any Liens other than
(i) those in favor of Administrative Agent for the benefit of Administrative Agent and Lenders, and
(ii) Liens expressly permitted in the Existing Loan Documents and exhibits thereto. Nothing herein
contained is intended to in any manner impair or limit the validity, priority and extent of
Administrative Agent’s existing Liens upon the Collateral.



     5. CONFIRMATION OF INDEBTEDNESS. Borrower confirms and acknowledges that as of the
date hereof, Borrower is indebted to Lenders and Administrative Agent under the Credit Agreement
and the other Existing Loan Documents in the aggregate principal
amount of $8,055,555.54 with
respect to the Term Loan, plus all accrued and unpaid interest thereon at the applicable rate(s)
provided for under the Credit Agreement, plus any and all accrued and unpaid fees at the applicable
rate(s) provided for under the Credit Agreement and the other Financing Documents (if any), plus
any and all unpaid costs and expenses (including attorneys’ fees) incurred to date in connection
with the Credit Agreement and the other Financing Documents and payable by Borrower as and to the
extent provided for in the Credit Agreement and the other Financing Documents, which amounts are
absolutely and unconditionally and jointly and severally owing by Borrowers without defense,
setoff, claim, counterclaim or deduction of any nature and Borrower hereby confirms that no such
defense, setoff, claim, counterclaim or deduction of any nature exists with respect to any of its
respective Obligations under the Credit Agreement and the other Existing Loan Documents.



     6. RELEASE. Borrower, by signing below, acknowledges and agrees that it has no actual
or potential claim or counterclaim or cause of action against Administrative Agent or any Lender
relating to the Credit Agreement or any other Existing Loan Documents and/or the Obligations of
Borrower arising thereunder or related thereto arising on or before the date hereof. As further
consideration for the amendments and accommodations granted by Administrative Agent and Lenders
under and set forth in this Amendment, Borrower hereby waives and releases and forever discharges
Administrative Agent and each Lender, and the respective officers, directors, attorneys, agents,
professionals and employees of Administrative Agent and each Lender (all collectively the
“Releasees”) from any liability, damage, claim, loss or expense of any kind that Borrower had, may
now have or may hereafter have against any one or more of the Releasee(s) arising out of or
relating to this Amendment, the Credit Agreement or any other Existing Loan Document and/or the
transactions described therein or contemplated thereby and/or the Obligations of Borrower arising
thereunder or therefrom or relating thereto and/or any actual or alleged actions, conduct, inaction
or omission on the part of any Releasee(s) in connection with the foregoing, to the extent arising
or occurring on or before the date hereof. Borrower hereby further agrees and covenants not to sue
any of the Releasees for any matter released or discharged by the foregoing, and not to bring any
such cause of action against any Releasee at any time in the future.



     7. MISCELLANEOUS



          (a) Counterparts. This Amendment may be executed in any number of counterparts and by
different parties on separate counterparts (including by facsimile or email transmission of
executed signature pages hereto), each of which counterparts, 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 Amendment.




          (b) Modifications. No modification hereof or any agreement referred to herein shall
be binding or enforceable unless in writing and signed on behalf of the party against whom
enforcement is sought.




          (c) No Third Party Beneficiaries; Indemnity. No rights are intended to be created
under this Amendment for the benefit of any third-party not party hereto, including without
limitation any donee, creditor, incidental beneficiary or equity holder or other affiliate of any Borrower.
Each Borrower




6









 




now or hereafter party to the Credit Agreement (as modified by this Amendment) hereby
agrees to indemnify Administrative Agent and each Lender from and against all losses, costs,
expenses, demands and damages whatsoever which Administrative Agent or such Lender (as applicable)
may suffer or incur in respect of any claims which have or may be brought by any third party
relating to this Amendment, the Existing Loan Documents or the transactions contemplated hereby or
thereby. This indemnity shall continue in full force and effect after the termination of this
Amendment, the Credit Agreement and the other Existing Loan Documents and notwithstanding the
completion of the other matters referred to in this Amendment. This indemnification is in addition
to and shall not limit any other indemnification agreement between Borrowers and Administrative
Agent and Lenders, and shall be included within the Obligations.




          (d) Integrated Agreement. This Amendment shall be deemed incorporated into and made a
part of the Existing Loan Documents. The Existing Loan Documents and this Amendment shall be
construed as integrated and complementary of each other, and as augmenting and not restricting
Administrative Agent’s and/or Lenders’ rights, remedies and security. If, after applying the
foregoing, an inconsistency still exists, the provisions of this Amendment shall control.




          (e) Non-Amendment. No omission or delay by Administrative Agent and/or any Lender in
exercising any right or power under this Amendment, or the Existing Loan Documents or any related
agreement will impair such right or power or be construed to be a waiver of any Default or Event of
Default or an acquiescence therein, and any single or partial exercise of any such right or power
will not preclude other or further exercise thereof or the exercise of any other right, and no
further amendment or waiver will be valid unless in writing and then only to the extent specified.
Administrative Agent’s and Lenders’ rights and remedies are cumulative and concurrent and may be
pursued singly, successively or together.




          (f) Headings. The headings of any paragraph of this Amendment are included for
convenience of reference only and shall not be given any substantive effect.




          (g) Survival. All warranties, representations and covenants made by Borrowers herein,
or in any agreement referred to herein or on any certificate, document or other instrument
delivered by them or on their behalf under this Amendment, shall be considered to have been relied
upon by Administrative Agent and Lenders. All statements in any such certificate or other
instrument shall constitute warranties and representations by the respective Borrowers hereunder.
All warranties, representations, indemnities and covenants made by Borrowers hereunder or under any
other agreement or instrument shall be deemed continuing until the Obligations are indefeasibly
paid and satisfied in full.




          (h) Further Assurances. The parties hereto shall execute and deliver such additional
documents and take such additional action, as may be reasonably necessary or desirable to
effectuate the provisions and purposes of this Amendment.




          (i) Successors and Assigns. This Amendment shall inure to the benefit of and be
binding upon the successors and assigns of each of the parties hereto, provided that, no
Borrower may assign, delegate or otherwise transfer any of its rights or other obligations
hereunder without the prior written consent of Administrative Agent and each Lender.




          (j) Time of the Essence. Time is of the essence with respect to the performance by
Borrowers of all of their obligations, undertakings, liabilities and duties under this Amendment.




          (k) Severability. In case any provision of or obligation under this Amendment shall
be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability
of the remaining provisions or obligations, or of such provision or obligation in any other
jurisdiction, shall not in any way be affected or impaired thereby.




7









 





          (l) Governing Law. THIS AMENDMENT, AND ALL MATTERS RELATING HERETO OR THERETO OR
ARISING THEREFROM (WHETHER SOUNDING IN CONTRACT LAW, TORT LAW OR OTHERWISE), SHALL BE GOVERNED BY,
AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF ILLINOIS, WITHOUT
REGARD TO CONFLICTS OF LAWS PRINCIPLES. EACH BORROWER NOW OR HEREAFTER PARTY TO THE CREDIT
AGREEMENT (AS MODIFIED BY THIS AMENDMENT) HEREBY CONSENTS TO THE JURISDICTION OF ANY STATE OR
FEDERAL COURT LOCATED WITHIN CHICAGO, STATE OF ILLINOIS AND IRREVOCABLY AGREES THAT, SUBJECT TO
ADMINISTRATIVE AGENT’S ELECTION, ALL ACTIONS OR PROCEEDINGS ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE OTHER FINANCING DOCUMENTS SHALL BE LITIGATED IN SUCH COURTS. EACH BORROWER NOW OR
HEREAFTER PARTY TO THE CREDIT AGREEMENT (AS MODIFIED BY THIS AMENDMENT) EXPRESSLY SUBMITS AND
CONSENTS TO THE JURISDICTION OF THE AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON
CONVENIENS. EACH BORROWER NOW OR HEREAFTER PARTY TO THE CREDIT AGREEMENT (AS MODIFIED BY THIS
AMENDMENT) HEREBY WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS AND AGREES THAT ALL SUCH SERVICE
OF PROCESS MAY BE MADE UPON SUCH BORROWER BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT
REQUESTED, ADDRESSED TO SUCH BORROWER AT THE ADDRESS SET FORTH IN THE CREDIT AGREEMENT AND SERVICE
SO MADE SHALL BE COMPLETE TEN (10) DAYS AFTER THE SAME HAS BEEN POSTED.




          (m) Jury Trial. EACH BORROWER NOW OR HEREAFTER PARTY TO THE CREDIT AGREEMENT (AS
MODIFIED BY THIS AMENDMENT), ADMINISTRATIVE AGENT AND THE LENDERS HEREBY IRREVOCABLY WAIVES ANY AND
ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AMENDMENT OR ANY OF THE EXISTING LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY
AND AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.
EACH BORROWER NOW OR HEREAFTER PARTY TO THE CREDIT AGREEMENT (AS MODIFIED BY THIS AMENDMENT),
ADMINISTRATIVE AGENT AND EACH LENDER ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO
ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS RELIED ON THE WAIVER IN ENTERING INTO THIS
AMENDMENT AND THE OTHER EXISTING LOAN, AND THAT EACH WILL CONTINUE TO RELY ON THIS WAIVER IN THEIR
RELATED FUTURE DEALINGS. EACH BORROWER NOW OR HEREAFTER PARTY TO THE CREDIT AGREEMENT (AS MODIFIED
BY THIS AMENDMENT), ADMINISTRATIVE AGENT AND EACH LENDER WARRANTS AND REPRESENTS THAT IT HAS HAD
THE OPPORTUNITY OF REVIEWING THIS JURY WAIVER WITH LEGAL COUNSEL, AND THAT IT KNOWINGLY AND
VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS.




[Signatures on Following Page]




[Remainder of Page Left Intentionally Blank]




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          IN WITNESS WHEREOF, the undersigned parties have executed this Amendment the day and year
first above written.



	 	 	 	 	 
	 	BORROWER:





OREXIGEN THERAPEUTICS, INC.

 	 
	 	By:  	/s/ Graham Cooper
 	 
	 	Name:  	 	Graham Cooper 	 
	 	Title:  	 	Chief Financial Officer 	 



	 	 	 	 	 
	 	AGENT:



MERRILL LYNCH CAPITAL,

a division of Merrill Lynch Business Financial Services Inc.,

as Administrative Agent

	 



	 	 	 	 	 
	 	By:  	                                      /s/ Maurice Amsellem
 	 
	 	Name:  	 	Maurice Amsellem 	 
	 	Title:  	 	Vice President 	 



	 	 	 	 	 
	 	LENDER:



MERRILL LYNCH CAPITAL,

a division of Merrill Lynch Business Financial Services Inc.,

as sole Lender
	 



	 	 	 	 	 
	 	By:  	                                      /s/ Maurice Amsellem
	 
	 	Name:  	 	Maurice Amsellem 	 
	 	Title:  	 	Vice President 	 



[Signature Page 1 of 1 to Second Amendment to Merrill Lynch/Orexigen Credit and Security Agreement]





 









 





EXHIBIT A TO SECOND AMENDMENT TO MERRILL LYNCH/OREXIGEN CREDIT AGREEMENT




New Schedule 2.1 to Credit Agreement




See Attached




 









 






          Schedule 2.1 — Amortization Schedule



     Borrowers
shall pay to Administrative Agent an “Amortization Payment” in respect of the
principal amount owing under each advance under the Term Loan as follows. As used in this Schedule
2.1 and otherwise in this Agreement, “Amortization Payment” shall mean:



               (i) with respect to the initial advance of the Term Loan in the amount of $10,000,000 made by
Lenders to Borrower on March 28, 2007, a monthly principal payment on the first day of each
calendar month beginning on December 1, 2007 and continuing through and including April 1, 2010
equal to the following amounts for each respective monthly payment date, which such payment
schedule represents the principal component of a mortgage-style amortization schedule assuming a
fixed interest rate equal to the 9.32% and 29 equal monthly payments:



	 	 	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 	Amortization	 
	 	 	 	 	 	Principal	 
	 	 	 	 	 	Payment	 
	 	 	Payment Date	 	 	Amount	 
	1

	 	12/1/2007
	 	$	248,741.47	 
	2

	 	1/1/2008
	 	$	250,673.36	 
	3

	 	2/1/2008
	 	$	252,620.26	 
	4

	 	3/1/2008
	 	$	254,582.28	 
	5

	 	4/1/2008
	 	$	256,559.53	 
	6

	 	5/1/2008
	 	$	258,552.15	 
	7

	 	6/1/2008
	 	$	260,560.23	 
	8

	 	7/1/2008
	 	$	262,583.92	 
	9

	 	8/1/2008
	 	$	264,623.32	 
	10

	 	9/1/2008
	 	$	266,678.56	 
	11

	 	10/1/2008
	 	$	268,749.77	 
	12

	 	11/1/2008
	 	$	270,837.06	 
	13

	 	12/1/2008
	 	$	272,940.56	 
	14

	 	1/1/2009
	 	$	275,060.40	 
	15

	 	2/1/2009
	 	$	277,196.70	 
	16

	 	3/1/2009
	 	$	279,349.59	 
	17

	 	4/1/2009
	 	$	281,519.21	 
	18

	 	5/1/2009
	 	$	283,705.67	 
	19

	 	6/1/2009
	 	$	285,909.12	 
	20

	 	7/1/2009
	 	$	288,129.68	 
	21

	 	8/1/2009
	 	$	290,367.49	 
	22

	 	9/1/2009
	 	$	292,622.68	 
	23

	 	10/1/2009
	 	$	294,895.38	 
	24

	 	11/1/2009
	 	$	297,185.73	 
	25

	 	12/1/2009
	 	$	299,493.88	 
	26

	 	1/1/2010
	 	$	301,819.94	 
	27

	 	2/1/2010
	 	$	304,164.08	 
	28

	 	3/1/2010
	 	$	306,526.42	 
	29

	 	4/1/2010
	 	$	308,907.11	 






               (ii) with respect to any advance requested by and made to Borrowers in respect of the First
Tranche (as defined in the Second Amendment), a monthly principal payment on the first day of each



 









 




calendar month beginning on May 1, 2008 and continuing through and including April 1, 2011
equal to the corresponding principal component of a mortgage-style amortization schedule (beginning
on the same May 1, 2008) assuming a fixed interest rate equal to the Base Rate plus Base Rate
Margin applicable to such advance as of the disbursement date for such advance and 36 equal monthly
payments, as calculated by Administrative Agent as of the disbursement date;




               (iii) with respect to any advance requested by and made to Borrowers in respect of the Second
Tranche (as defined in the Second Amendment), a monthly principal payment on the first day of each
calendar month beginning on August 1, 2008 and continuing through and including July 1, 2011 equal
to the corresponding principal component of a mortgage-style amortization schedule assuming a fixed
interest rate equal to the Base Rate plus Base Rate Margin applicable to such advance as of the
disbursement date for such advance and 36 equal monthly payments, as calculated by Administrative
Agent as of the disbursement date; provided that, if the Second Tranche is not requested by
Borrowers until on or after July 1, 2008, “Amortization Payment” with respect to the Second Tranche
shall mean a monthly principal payment on the first day of each calendar month beginning on the
first day of the second full calendar month beginning after the disbursement date for such advance
(the “Second Tranche Repayment Start Date”) (for example, the Second Tranche Repayment Start Date
for an advance made on August 15, 2008 would be October 1, 2008) and continuing through and
including July 1, 2011 equal to the corresponding principal component of a mortgage-style
amortization schedule (beginning on such Second Tranche Repayment Start Date) assuming a fixed
interest rate equal to the Base Rate plus Base Rate Margin applicable to such advance as of the
disbursement date for such advance and a number of equal monthly payments corresponding to the
number of full calendar months from the month beginning with the Repayment Start Date through the
month beginning July 1, 2011 (for example, the number of months in the amortization schedule for an
advance made on August 15, 2008 would be thirty-four (34)).



 









 





EXHIBIT B TO SECOND AMENDMENT TO MERRILL LYNCH/OREXIGEN CREDIT AGREEMENT




New Annex A to Credit Agreement




See Attached




 









 





            Annex A to Credit Agreement (Commitment Annex)



	 	 	 	 	 	 	 	 	 
	 	 	Term Loan	 	 	Term Loan	 
	 	 	Commitment	 	 	Commitment	 
	Lender	 	Amount	 	 	Percentage	 
	Merrill Lynch Capital
	 	$	25,000,000	 	 	 	100%	 
	 
	 	 	 	 	 	 	 	 
	TOTALS
	 	$	25,000,000	 	 	 	100%