Document:

exv10w2

 

Exhibit 10.2

PROMISSORY NOTE

October 31, 2006

(Date)

FOR VALUE RECEIVED, Genitope Corporation a corporation located at the address stated below
(“Maker”) promises, jointly and severally if more than one, to pay to the order of General
Electric Capital Corporation or any subsequent holder hereof (each, a “Payee”) at its office
located at 83 Wooster Heights Road, Danbury, CT 06810 or at such other place as Payee or the
holder hereof may designate, the principal sum of Three Million Nine Hundred Five Thousand One
Hundred Ninety Six and 97/00 Dollars $3,905,196.97, with interest on the unpaid principal
balance, from the date hereof through and including the dates of payment, at a fixed interest
rate of Ten and Zero Hundredths percent (10.00%) per annum, to be paid in lawful money of the
United States, in thirty-six (36) consecutive monthly installments of principal and interest as
follows:

	 	 	 	 	 
	  Periodic	 	 
	Installment	 	Amount
	Thirty-Five (35)
	 	 	$126, 009.72	 

each (“Periodic Installment”) and a final installment which shall be in the amount of the
total outstanding principal and interest. The first Periodic Installment shall be due and
payable on December 1, 2006 and the following Periodic Installments and the final
installment shall be due and payable on the same day of each succeeding month (each, a
“Payment Date”). Such installments have been calculated on the basis of a 360 day year of
twelve 30-day months. Each payment may, at the option of the Payee, be calculated and
applied on an assumption that such payment would be made on its due date.

The acceptance by Payee of any payment which is less than payment in full of all amounts due
and owing at such time shall not constitute a waiver of Payee’s right to receive payment in
full at such time or at any prior or subsequent time.

The Maker hereby expressly authorizes the Payee to insert the date value is actually given in the
blank space on the face hereof and on all related documents pertaining hereto.

This Note may be secured by a security agreement, chattel mortgage, pledge agreement or like
instrument (each of which is hereinafter called a “Security Agreement”).

Time is of the essence hereof. If any installment or any other sum due under this Note or
any Security Agreement is not received within ten (10) days after its due date, the Maker agrees
to pay, in addition to the amount of each such installment or other sum, a late payment charge of
five percent (5%) of the amount of said installment or other sum, but not exceeding any lawful
maximum. If (i) Maker fails to make payment of any amount due hereunder within ten (10) days
after the same becomes due and payable; or (ii) a default has occurred and is continuing under
Section 7(a) of the Security Agreement, then the entire principal sum remaining unpaid, together
with all accrued interest thereon and any other sum payable under this Note or any Security
Agreement, at the election of Payee, shall immediately become due and payable, with interest
thereon at the lesser of eighteen percent (18%) per annum or the highest rate not prohibited by
applicable law from the date of such accelerated maturity until paid (both before and after any
judgment). [Less any cash amount held back by Secured Party.]

The Maker may prepay in full, but not in part, its entire indebtedness. Payment of the entire
indebtedness will include a penalty equal to the following percentages of the remaining principal
balance for the indicated period:

     Prior to the first annual anniversary date of this Note: Three percent (3%)

     Thereafter and prior to the second annual anniversary date of this Note: Two percent (2%)

     Thereafter and prior to the third annual anniversary date of this Note: One percent (1%)

Plus all other sums due hereunder or under any Security Agreement.

It is the intention of the parties hereto to comply with the applicable usury laws;
accordingly, it is agreed that, notwithstanding any provision to the contrary in this Note or any
Security Agreement, in no event shall this Note or any Security Agreement require the payment or
permit the collection of interest in excess of the maximum amount permitted by applicable law.
If any such excess interest is contracted for, charged or received under this Note or any
Security Agreement,

 

 

or if all of the principal balance shall be prepaid, so that under any of
such circumstances the amount of interest contracted for, charged or received under this Note or
any Security Agreement on the principal balance shall exceed the maximum amount of interest
permitted by applicable law, then in such event (a) the provisions of this paragraph shall
govern and control, (b) neither Maker nor any other person or entity now or hereafter liable for
the payment hereof shall be
obligated to pay the amount of such interest to the extent that it is in excess of the maximum
amount of interest permitted by applicable law, (c) any such excess which may have been
collected shall be either applied as a credit against the then unpaid principal balance or
refunded to Maker, at the option of the Payee, and (d) the effective rate of interest shall be
automatically reduced to the maximum lawful contract rate allowed under applicable law as now or
hereafter construed by the courts having jurisdiction thereof. It is further agreed that without
limitation of the foregoing, all calculations of the rate of interest contracted for, charged or
received under this Note or any Security Agreement which are made for the purpose of determining
whether such rate exceeds the maximum lawful contract rate, shall be made, to the extent
permitted by applicable law, by amortizing, prorating, allocating and spreading in equal parts
during the period of the full stated term of the indebtedness evidenced hereby, all interest at
any time contracted for, charged or received from Maker or otherwise by Payee in connection with
such indebtedness; provided, however, that if any applicable state law is amended or the law of
the United States of America preempts any applicable state law, so that it becomes lawful for the
Payee to receive a greater interest per annum rate than is presently allowed, the Maker agrees
that, on the effective date of such amendment or preemption, as the case may be, the lawful
maximum hereunder shall be increased to the maximum interest per annum rate allowed by the
amended state law or the law of the United States of America.

The Maker and all sureties, endorsers, guarantors or any others (each such person, other than
the Maker, an “Obligor”) who may at any time become liable for the payment hereof jointly and
severally consent hereby to any and all extensions of time, renewals, waivers or modifications
of, and all substitutions or releases of, security or of any party primarily or secondarily
liable on this Note or any Security Agreement or any term and provision of either, which may be
made, granted or consented to by Payee, and agree that suit may be brought and maintained against
any one or more of them, at the election of Payee without joinder of any other as a party
thereto, and that Payee shall not be required first to foreclose, proceed against, or exhaust any
security hereof in order to enforce payment of this Note. The Maker and each Obligor hereby
waives presentment, demand for payment, notice of nonpayment, protest, notice of protest, notice
of dishonor, and all other notices in connection herewith, as well as filing of suit (if
permitted by law) and diligence in collecting this Note or enforcing any of the security hereof,
and agrees to pay (if permitted by law) all expenses incurred in collection, including Payee’s
reasonable attorneys’ fees.

THE MAKER HEREBY UNCONDITIONALLY WAIVES ITS RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF
ACTION BASED UPON OR ARISING OUT OF, DIRECTLY OR INDIRECTLY, THIS NOTE, ANY OF THE RELATED
DOCUMENTS, ANY DEALINGS BETWEEN MAKER AND PAYEE RELATING TO THE SUBJECT MATTER OF THIS
TRANSACTION OR ANY RELATED TRANSACTIONS, AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED
BETWEEN MAKER AND PAYEE. THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL ENCOMPASSING OF ANY AND
ALL DISPUTES THAT MAY BE FILED IN ANY COURT (INCLUDING, WITHOUT LIMITATION, CONTRACT CLAIMS, TORT
CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS.) THIS WAIVER IS
IRREVOCABLE MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THE WAIVER SHALL
APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS NOTE, ANY
RELATED DOCUMENTS, OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THIS TRANSACTION OR ANY
RELATED TRANSACTION. IN THE EVENT OF LITIGATION, THIS NOTE MAY BE FILED AS A WRITTEN CONSENT TO
A TRIAL BY THE COURT.

This Note and other Debt Documents constitute the entire agreement of the Maker and Payee with
respect to the subject matter hereof and supersedes all prior understandings, agreements and
representations, express or implied.

No variation or modification of this Note, or any waiver of any of its provisions or
conditions, shall be valid unless in writing and signed by an authorized representative of Maker
and Payee. Any such waiver, consent, modification or change shall be effective only in the
specific instance and for the specific purpose given.

Any provision in this Note or any of the other Debt Documents which is in conflict with any
statute, law or applicable rule shall be deemed omitted, modified or altered to conform thereto.

 

 

	 	 	 	 	 	 	 
	 	 	 	 	Genitope Corporation
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	/s/ Laura R. Woodhead 

	 	 	 	By:
	 	/s/ John Vuko
	 

	 	 	 	 	 	 
	(Witness)
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	Laura R. Woodhead 

	 	 	 	Name:
	 	John Vuko
	 

(Print name)

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	6900 Dumbarton Circle
Fremont, CA 94555 

	 	 	 	Title:
	 	CFO
	 

(Address)

	 	 	 	 	 	 
	 	 	 	 	Federal Tax ID #: 770436313
	 
	 	 	 	 	 	 
	 	 	 	 	Address: 6900 Dumbarton Circle, Fremont, CA 94555exv10w3

 

Exhibit 10.3

SECURITY DEPOSIT PLEDGE AGREEMENT

(Loan)

          
This Security Deposit Pledge Agreement (this
“Agreement”) is made and entered into as of
the 31st day of October, 2006, by and between Genitope Corporation a Delaware corporation with its
principal place of business at 6900 Dumbarton Circle, Fremont, CA
94555, (“Debtor”) and General
Electric Capital Corporation, a Delaware corporation, with its principal place of business at 83
Wooster Heights Road, 5th Floor, Danbury, CT 06810
 (“Secured Party”).

     In consideration of, and as an inducement for Secured Party to lend funds to Debtor under the
Master Security Agreement, dated as of October 31, 2006, and any Collateral Schedules and
Promissory Notes thereunder (the “Master Security Agreement and all Collateral Schedules and
Promissory Notes thereto being referred to as the “Loan
Documents”), and to secure the payment and
performance of all of Debtor’s obligations under the Loan Documents, Debtor hereby deposits and
pledges with Secured Party the sum of Nine Hundred Seventy-Six Thousand Two Hundred Ninety-Nine and
26/100 Dollars $976,299.26 (the “Security Deposit”), such pledge to be upon the terms and
conditions set forth below (all capitalized terms not otherwise defined herein shall have the
meanings set forth in the Loan Documents):

     1. Debtor delivers the Security Deposit to Secured Party to secure Debtor’s performance of
its obligations under the Loan Documents, including, but not limited to, the timely payment of the
Periodic Installments.

     2. The Security Deposit deposited with Secured Party shall accrue interest at 4% simple
interest per annum from the date of deposit through the date such Security Deposit is returned to
Debtor in connection with Section 5 hereof. Secured Party may commingle the Security Deposit with
its other funds.

     3. Upon any default by Debtor under the Loan Documents, interest accrual on the Security
Deposit shall cease and Secured Party may, at its option, apply the Security Deposit towards the
satisfaction of Debtor’s obligations under the Loan Documents and the payment of all costs and
expenses incurred by Secured Party as a result of such default, including but not limited to, costs
of repossessing equipment and reasonable attorneys’ fees. Such application shall not excuse the
performance at the time and in the manner prescribed of any obligation of Debtor or cure a default
of Debtor. Upon the application by Secured Party of any amount of the Security Deposit pursuant to
the terms of this paragraph, Debtor shall be obligated to immediately pay to Secured Party an
amount sufficient to cause the Security Deposit to equal the amount first set forth above as
reduced in accordance with Section 5 herein.

     4. Secured Party shall have no duty to first commence an action against or seek recourse from
Debtor, in the event of a default under the Loan Documents, before enforcing the provisions of, and
proceedings under the provisions of this Agreement. The obligations of Debtor under this Agreement
shall be absolute and unconditional and shall remain in full force and effect without regard to,
and shall not be released or discharged or in any way affected by:

	 	(a)	 	any amendment or modification of or supplement to the Loan Documents;
	 
	 	(b)	 	any exercise or non-exercise of any right, remedy or privilege under or in respect
to this Agreement, the Loan Documents, or any other instrument provided for in the Loan
Documents, or any waiver, consent, explanation, indulgence or actions or inaction with
respect to any such instrument; or

 

 

	 	(c)	 	any bankruptcy, insolvency, reorganization, arrangement, readjustment,
composition, liquidation or similar proceeding of Debtor.

     5. So long as Debtor is not in default under the Loan Documents or under any other material
financial obligation, Secured Party agrees to reduce the Security Deposit to an amount equivalent
to 25% of the outstanding principal balance of the Loan. The Secured Party shall then refund to
Debtor any Security Deposit in excess of the reduced Security Deposit and accrued interest on the
refunded amount (less any portion of same cashed, sold, assigned or delivered pursuant to, and
under the circumstances specified in Paragraph 3 hereof). The refunds will take place every six
months commencing January 1, 2007.

     6. So long as Debtor is not in default under the Loan Documents, and in the event Debtor has
(i) borrowed $6,666,666.00 from Secured Party prior to November 30, 2006 and (ii) received the Food
and Drug Administration’s (“FDA”) approval of the marketing and use of Debtor’s drug, MyVax
personalized immunotherapy, Secured Party agrees to deliver to Debtor the Security Deposit and
accrued interest thereon (less any portion of same cashed, sold, assigned or delivered pursuant to
and under the conditions specified in paragraphs 3 and 5 hereof), but in no event will said refund
occur prior to August 31, 2007. Prior to the refund, Debtor shall supply Secured Party with
documented proof of the FDA approval acceptable to Secured Party in its sole discretion. Nothing
in this Section shall be deemed to require Secured Party to refund to Debtor any amount greater
than the amount of the Security Deposit on the date of such scheduled refund. Upon such refund,
Debtor will no longer be required to deposit any Security Deposit with Secured Party, and this
Agreement shall thereupon be without further effect.

     7. So long as Debtor is not in default under the Loan Documents, and in the event Debtor has
(i) borrowed $6,666,666.00 from Secured Party after November 30, 2006 and prior to December 30,
2006, and (ii) received the Food and Drug Administration’s (“FDA”) approval of the marketing and
use of Debtor’s drug, MyVax personalized immunotherapy, Secured Party agrees to deliver to Debtor
the Security Deposit and accrued interest thereon (less any portion of same cashed, sold, assigned
or delivered pursuant to and under the conditions specified in paragraphs 3 and 5 hereof), but in
no event will said refund occur prior to October 30, 2007. Prior to the refund, Debtor shall supply
Secured Party with documented proof of the FDA approval acceptable to Secured Party in its sole
discretion. Nothing in this Section shall be deemed to require Secured Party to refund to Debtor
any amount greater than the amount of the Security Deposit on the date of such scheduled refund.
Upon such refund, Debtor will no longer be required to deposit any Security Deposit with Secured
Party, and this Agreement shall thereupon be without further effect.

     8. Upon the termination of the Loan Documents and the satisfaction of all of the
obligations of Debtor thereunder, Secured Party shall deliver to Debtor the Security Deposit and
accrued interest thereon (less any portion of same cashed, sold, assigned or delivered pursuant
to and under the conditions specified in paragraphs 3 and 5 hereof), and this Agreement shall
thereupon be without further effect.

     9. Secured Party may, without the consent of Debtor, assign this Agreement to another
financial institution reasonably acceptable to Debtor. Debtor agrees that if Debtor receives
written notice of an assignment from Secured Party, Debtor will pay all amounts due hereunder to
such assignee or as
instructed by Secured Party. Debtor also agrees to confirm in writing receipt of the notice of
assignment as may be reasonably requested by assignee. Debtor hereby waives and agrees not to
assert against any such assignee any defense, set-off, recoupment claim or counterclaim, which
Debtor has or may at any time have against Secured Party for any reason whatsoever.

 

 

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed as of the date first above written.

	 	 	 	 	 	 	 	 	 
	SECURED PARTY:	 	DEBTOR:
	 
	General Electric Capital Corporation	 	Genitope Corporation
	 
	 	 	 	 	 	 	 	 
	By:

	 	/s/ Diane Earle 	 	 	 	By:	 	/s/ John Vuko 
	 

	 	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Name:

	 	Diane Earle 	 	 	 	Name:	 	John Vuko 
	 

	 	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Title:

	 	Duly Authorized Signatory 	 	 	 	Title:	 	Vice President and CFO

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