Document:

Exhibit

10.7

$30,000,000; provided, however,

that the sum of the Commitments 

of the Investors and the Lender shall not 

exceed the Facility Amount.

March 31, 1999

FUNB STRUCTURED NOTE

THIS FUNI3 STRUCTURED NOTE HAS NOT BEEN REGISTERED

UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES

ACT”) OR UNDER ANY STATE SECURITIES LAWS AND THE BORROWER (AS

DEFINED BELOW) HAS NOT BEEN REGISTERED UNDER THE INVESTMENT COMPANY ACT OF

1940, AS AMENDED (THE “INVESTMENT COMPANY ACT”).  THIS FUNB STRUCTURED NOTE MAY NOT BE SOLD,

OFFERED FOR SALE OR OTHERWISE TRANSFERRED WITHOUT REGISTRATION UNDER THE

SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS EXCEPT IN A TRANSACTION

THAT IS EXEMPTED UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS.

THIS FUNB STRUCTURED NOTE IS NOT PERMITTED TO BE

TRANSFERRED, ASSIGNED, EXCHANGED OR OTHERWISE PLEDGED OR CONVEYED EXCEPT IN

COMPLIANCE WITH THE TERMS OF THE LOAN FUNDING AND SERVICING AGREEMENT REFERRED

TO HEREIN.

IN NO EVENT SHALL THE BORROWER (DEFINED BELOW) BE

ENTITLED TO HAVE ADVANCES MADE TO IT UNDER THIS FUNB STRUCTURED NOTE AND THE

VFCC STRUCTURED NOTE IN AN AGGREGATE AMOUNT IN EXCESS OF THE FACILITY AMOUNT

(AS DEFINED IN THE LOAN FUNDING AND SERVICING AGREEMENT (AS DEFINED BELOW)).

FOR VALUE RECEIVED, ACS FUNDING TRUST I, a Delaware

business trust (the “Borrower”),

promises to pay to WACHOVIA BANK, NATIONAL ASSOCIATION (f/k/a First Union

National Bank) (the “Lender”), or its

assigns, the principal sum of THIRTY MILLION DOLLARS ($30,000,000) or, if less,

the unpaid principal amount of the aggregate advances (“Advances”) made by the Lender (as defined

below) to the Borrower pursuant to the Loan Funding and Servicing Agreement (as

defined below), as set forth on the attached Schedule, on the dates specified

in Section 2.6 of the Loan Funding and

Servicing Agreement, and to pay interest on the unpaid principal amount of each

Advance on each day that such unpaid principal amount is outstanding at the

Interest Rate related to such Advance as provided in the Loan Funding and

Servicing Agreement on each Payment Date and each other dates specified in the

Loan Funding and Servicing Agreement.

This FUNB Structured Note is issued pursuant to the

Loan Funding and Servicing Agreement, dated as of March 31, 1999, as amended by

Amendment No. 1, dated as of June 30, 1999, Amendment No. 2, dated as of

September 24, 1999, Amendment No. 3, dated as of December 14, 1999, Amendment

No. 4, dated as of June 16, 2000, Amendment No. 5, dated as

 

 

of December 20, 2000,

Amendment No. 6, dated as of March 29, 2001, Amendment No. 7, dated as of April

19, 2001, Amendment No. 8, dated as of January 15, 2002, and Amendment No. 9,

dated as of March 29, 2002 (as amended, modified, waived, supplemented, or

restated from time to time, the “Loan Funding and

Servicing Agreement”), by and among the Borrower, American Capital

Strategies, Ltd., as servicer, Variable Funding Capital Corporation, as a

lender, the Investors named therein, Wells Fargo Bank Minnesota, National

Association (f/k/a Norwest Bank Minnesota, National Association), as backup

servicer and as collateral custodian, First Union Securities, Inc.

(successor-in-interest to First Union Capital Markets Corp.), as deal agent,

and Wachovia Bank, National Association (f/k/a First Union National Bank), as a

lender and as liquidity agent. 

Capitalized terms used but not defined in this Note are used with the

meanings ascribed to them in the Loan Funding and Servicing Agreement.

Notwithstanding any other provisions contained in this

FUNB Structured Note, if at any time the Interest Rate payable by the Paying

Agent on behalf of the Borrower under this Structured Note, when combined with

any and all other charges provided for in this FUNB Structured Note, in the

Loan Funding and Servicing Agreement or in any other document (to the extent

such other charges would constitute interest for the purpose of any applicable

law limiting interest that may be charged on this FUNB Structured Note),

exceeds the highest rate of interest permissible under applicable law (the “Maximum Lawful Rate”), then so long as the

Maximum Lawful Rate would be exceeded the Interest Rate under this FUNB

Structured Note shall be equal to the Maximum Lawful Rate.  If at any time thereafter the Interest Rate

payable under this FUNB Structured Note is less than the Maximum Lawful Rate,

the Paying Agent on behalf of the Borrower shall continue to pay Interest under

this FUNB Structured Note at the Maximum Lawful Rate until such time as the

total Interest paid by the Paying Agent on behalf of the Borrower is equal to

the total Interest that would have been paid had applicable law not limited the

Interest Rate payable under this FUNB Structured Note.  In no event shall the total Interest

received by the Lenders under this FUNB Structured Note exceed the amount which

such Lenders could lawfully have received had the Interest due under this FUNB

Structured Note been calculated since the date of this FUNB Structured Note at

the Maximum Lawful Rate.

Payments of the principal of, and Interest on, the

Advances by the Lenders and represented by this FUNB Structured Note shall be

made by the Paying Agent on behalf of the Borrower to the holder or holders

hereof by wire transfer of immediately available funds in the manner and at the

address specified for such purpose as provided in the Loan Funding and

Servicing Agreement, or in such manner or at such other address as the holder

or holders of this FUNB Structured Note shall have specified in writing to the

Borrower for such purpose, without the presentation or surrender of this FUNB

Structured Note or the making of any notation on this FUNB Structured Note.

If any payment under this FUNB Structured Note falls

due on a day that is not a Business Day, then such due date shall be extended

to the next succeeding Business Day and Interest shall be payable on any

principal so extended at the applicable Interest Rate.

If all or a portion of (i) the principal amount hereof

or (ii) any Interest payable thereon or (iii) any other amounts payable

hereunder shall not be paid when due (whether at maturity, by acceleration or

otherwise), such overdue amount shall bear Interest at a rate per annum that is

 

2

 

equal to the Base Rate plus 1.0%, in each case from the date of such

non–payment to (but excluding) the date such amount is paid in full.

Portions or all of the principal amount of the FUNB

Structured Note shall become due and payable at the time or times set forth in

the Loan Funding and Servicing Agreement. 

Any portion or all of the principal amount of this FUNB Structured Note

may be prepaid, together with Interest thereon (and, as set forth in the Loan

Funding and Servicing Agreement, certain costs and expenses of the Lenders) at

the time and in the manner set forth in, but subject to the provisions of, the

Loan Funding and Servicing Agreement.

The Borrower expressly waives presentment, demand,

diligence, protest and all notices of any kind whatsoever with respect to this

FUNB Structured Note.

All amounts evidenced by this FUNB Structured Note,

the Advances, Advances Outstanding and all payments and prepayments of the

principal hereof and the respective dates and maturity dates thereof shall be

endorsed by the Deal Agent, as agent for the Lenders, on the Schedule attached

hereto and made a part hereof or on a continuation thereof, which shall be

attached hereto and made a part hereof or otherwise recorded in its internal

books or records or computer system; provided, however,

that the failure of the Deal Agent to make such a notation or recordation shall

not in any way limit or otherwise affect the obligations of the Borrower under

this FUNB Structured Note as provided in the Loan Funding and Servicing

Agreement.

The holder or holders hereof may sell, assign, transfer,

negotiate, grant participations in or otherwise dispose of all or any portion

of any Advances, Advances Outstanding or the Commitment represented by this

FUNB Structured Note.  All transfers and

pledges of this FUNB Structured Note must be done in compliance with the

Securities Act, applicable state securities laws and Article 8 of the UCC.

This FUNB Structured Note is secured by the security

interests granted pursuant to Section 2.9

of the Loan Funding and Servicing Agreement. 

The holder or holders of this FUNB Structured Note are entitled to the

benefits of the Loan Funding and Servicing Agreement and may enforce the

agreements of the Borrower contained in the Loan Funding and Servicing

Agreement and exercise the remedies provided for by, or otherwise available in

respect of, the Loan Funding and Servicing Agreement, all in accordance with,

and subject to the restrictions contained in, the terms of the Loan Funding and

Servicing Agreement.  If a Termination Event

shall occur and the Termination Date has been declared or has otherwise

occurred, the unpaid balance of the principal of all Advances, together with

accrued Interest thereon, shall be declared, and become, due and payable in the

manner and with the effect provided in the Loan Funding and Servicing

Agreement.

This FUNB Structured Note is one of the “Structured Notes” referred to in Section 2.5 of the Loan Funding and Servicing

Agreement.  THIS STRUCTURED NOTE SHALL

BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.

This FUNB Structured Note is intended to be and is an

amendment to, and replacement of, the FUNB Note, dated March 31, 1999, in the

maximum principal amount of $30,000,000

 

3

 

(the “Replaced Note”).  This FUNB Structured Note evidences the same indebtedness and is

secured by the same Collateral securing the Replaced Notes and is not intended

to constitute a novation in any manner.

 

4

 

 IN WITNESS

WHEREOF, the undersigned has executed this FUNB Structured Note as on the date

first written above.

	

   

  	

  ACS

  FUNDING TRUST I

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  By

  	

   

  
	

   

  	

  Name:

  	

   

  
	

   

  	

  Title:

  	

   

  

 

 

5

 

	

  Schedule attached to FUNB

  Structured Note dated March 31, 1999 of ACS Funding Trust I payable to the

  order of Wachovia Bank, National Association, as the Lender

  
	

  Advances Outstanding as of March 29, 2002

  (Date of Amendment No. 9)

  	

  $

  	

   

  	

   

  	

   

  
	

   

  
	

  Date of Advance or Repayment

  	

   

  	

  Principal Amount of Advance

  	

   

  	

  Principal Amount of Repayment

  	

   

  	

  Advances Outstanding

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
									

 

 

6Exhibit

10.16

 

PUBLIC HEALTH SERVICE

FIRST AMENDMENT TO

EXCLUSIVE LICENSE AGREEMENT (L-068-02/0)

 

AMENDMENT

L-068-02/1

 

This

Amendment of the Exclusive Patent

License L-068-02/0 (“Agreement”),

L-068-02/1 (“Amendment”), is made

between the National Institutes of Health (“NIH”),

the Centers for Disease Control and Prevention (“CDC”), or the Food and Drug Administration (“FDA”), hereinafter singly or collectively

referred to as (“PHS”), agencies

of the United States Public Health Service within the Department of Health and

Human Services (“DHHS”) through

the Office of Technology Transfer, NIH,

having an address at 6011 Executive Boulevard, Suite 325, Rockville, Maryland

20852-3804, U.S.A., Procept, Inc., having offices at the address

indicated on the Signature Page, hereinafter referred to as “Licensee”.

 

Whereas, PHS desires the Agreement to be amended a first time in

order to resolve issues concerning the following:

(a) Paragraphs 1.02 and 4.01; (b) Appendix C; (b) Appendix G; (d)

Appendix H of said Agreement; and

 

Whereas, PHS and Licensee are willing to amend the terms of

the Agreement a first time to

accommodate these issues.

 

Now Therefore, PHS and Licensee, intending to be bound, hereby

agree that the following changes will be made to the Agreement:

 

1.                                       Amended

Paragraph 1.02 will now read:

 

PHS, by executing

interinstitutional agreements with PSU (L-067-02/0), and UC (L-086-02/0), has obtained

the exclusive license, including the right to sublicense, the Licensed Patent Rights listed in

Appendix A.  Once executed, the terms

and conditions of this Agreement shall supersede, and thereby

terminate the terms and conditions of the previous license agreement between

Pacific Pharmaceuticals, Inc., (now Procept, Inc.) and PSU, made effective on

February 6, 1998, provided that, the sublicense agreement, including its

associated amendment, by and between AOI Pharmaceuticals, Inc. (“Sublicensee”)

and Licensee

made effective on October 13, 2000, and attached as Appendices G and H (such

sublicense agreement, and its associated amendment, the “Sublicensee Agreement”), and

the Amendment to this Agreement (L-068-02/1) shall continue to

remain in full force and effect;

 

2.                                       Amended

Paragraph 4.01 will now read:

 

Upon written approval by PHS, Licensee and Sublicensee

may enter into sublicensing agreements under the Licensed Patent Rights.  Notwithstanding anything else stated herein,

PHS acknowledges

that this Agreement

does not terminate, alter or supersede the Sublicensee Agreement that

existed and continues to exist between Licensee and Sublicensee, and listed in

Appendices G and H respectively,  pursuant to Section 1.02 of this Agreement.   PHS hereby

approves the Sublicensee Agreement in the event of

termination of this Agreement under Article 13, as long as Sublicensee and  all subtier sublicensees  conform

to, and are in compliance with, the terms and conditions set forth in this Agreement within ninety (90) days of the

date Sublicensee receives notice

of such termination;

 

3.                                       Amended Appendix

C will now read:

 

Licensee

agrees to pay PHS sublicensing royalties as follows:

 

•                  The greater of

Twenty-Two and One-Half Percent (22.5%) of the royalties received by Licensee

or any of its Affiliates from Net Sales

by any sublicensee, including Sublicensee, of Licensed Products or Licensed

Processes or One and Four Fifths Percent (1.8%) of Net Sales by any sublicensee(s), including any subtier

licensing.

 

4.             Amendments to

Appendix G are as follows:

 

 

(1) The sentence: “WHEREAS,

Procept is party to a License Agreement with The Penn State Research Foundation

(“Penn”) dated February 6, 1998, (the “Penn License Agreement”), a copy of

which is attached hereto as Exhibit A, under which Procept is granted an

exclusive worldwide license to certain Patent Rights (as defined therein) and

Know-how (as defined therein) which are co-owned by Penn, the National

Institutes of Health, Case Western Reserve University and the University of

Chicago; is hereby modified in the following way:

 

•                  All references to Procept, Inc.,  (formerly Pacific Pharmaceuticals, Inc.)

being party to a License Agreement with  The Penn State Research

Foundation no longer apply.  The terms

and conditions of such a License

Agreement are hereby replaced by the terms and conditions of this Agreement;

•                  “Patent

Rights” as referred to in Appendix G will now be defined as “Licensed Patent Rights” as defined in Paragraph 2.07 of the Agreement;

•                  Any use of the term “know-how”, and any

reference or terms regarding “Know-how” is hereby deleted and no longer apply;

•                  All references to Case Western Reserve

University are hereby deleted and no longer apply.

 

(2)

The term “fields of use” in paragraph 2.1 shall now be defined as the Licensed

Fields of Use stated in

Appendix B of said Agreement;

 

(3)

Paragraph 5.1 shall now be amended to reference Appendix E of the Agreement as Benchmarks and Performance.

 

5.             Amendment to Item

1. of Appendix H shall now read:

 

AOIP

shall now be bound by the terms of Article 4 of the Revised

License Agreement;

 

6.                                       Appendix J, the

Comprehensive Release Agreement, once executed, shall remain binding and in

effect to all parties;

 

7.                                       All terms and

conditions of the Agreement not

herein amended remain binding and in effect;

 

8.                                       The

Agreement and this Amendment constitute the entire

understanding between PHS and Licensee and supersede all prior agreements

and understandings with respect to the aforementioned amendments; and

 

9.                                       This Amendment

is effective when signed by all parties.

 

SIGNATURES BEGIN ON NEXT PAGE

 

2

 

AMENDMENT TO PHS LICENSE AGREEMENT L-068-02/0

 

PHS AMENDMENT TO

PATENT LICENSE AGREEMENT–EXCLUSIVE

 

	

  SIGNATURE PAGE

  
	

   

  	

   

  
	

  For PHS:

  	

   

  
	

   

  	

   

  
	

  /s/ Jack

  Spiegel

  	

   

  	

  5/13/2002

  	

   

  
	

  Jack

  Spiegel, Ph.D.

  	

  Date

  
	

  Director,

  Division of Technology Development and Transfer

  	

   

  
	

  Office of Technology

  Transfer

  	

   

  
	

  National

  Institutes of Health

  	

   

  
	

   

  	

   

  
	

  Mailing

  Address for Notices:

  	

   

  
	

   

  	

   

  
	

  Office of Technology Transfer

  National Institutes of Health

  6011 Executive Boulevard, Suite 325

  Rockville,

  Maryland  20852-3804  U.S.A

  	

   

  
				

 

 

For Licensee (Upon, information

and belief, the undersigned expressly certify or affirm that the contents of

any statements of Licensee made or referred to in this

document are truthful and accurate.):

 

 

	

  PROCEPT, INC.

  
	

  369 Lexington Avenue

  
	

  10th Floor

  
	

  New York, NY 10017

  
	

   

  
	

   

  
	

  By: Salvatore A. Bucci

  
	

   

  
	

  Name: 

  	

  /s/ Salvatore A.

  Bucci

  	

   

  
	

   

  
	

  Title: President

  and Chief Executive Officer

  
	

   

  
	

  Date: 

  	

  5/17/02

  	

   

  
				

 

3

 

ACKNOWLEDGEMENT AND ACCEPTANCE

 

AOI Pharmaceuticals, Inc.

(“AOIP”), by its signature below, acknowledges and agrees to the following:

1.             AOIP

shall be bound by the terms to this Amendment

(L-068-02/1) to the Revised Licensing

Agreement (L-068-02/0).

2.             AOIP

shall be bound by the terms of Article 4 of the Revised License Agreement as amended by this Amendment (L-068-02/1).

3.             The

Amendment (L-068-02/1) to the Revised License Agreement (L-068-02/0)

serves as an Amendment to its Sublicensing Agreement with Procept, Inc.

 

For Sublicensee (Upon, information and belief, the

undersigned expressly certify or affirm that the contents of any statements of Sublicensee made or referred to in this

document are truthful and accurate.):

 

 

	

  AOI

  PHARMACEUTICALS, INC.

  
	

  An Access Oncology Company

  
	

  750 Lexington Avenue

  
	

   26th

  Floor

  
	

  New York, NY 10022

  
	

   

  
	

   

  
	

  By: 

  Craig Henderson, M.D.

  
	

   

  
	

   

  
	

  Name:

  	

   /s/ I. Craig Henderson

  	

   

  
	

   

  
	

  Title: Chief

  Executive Officer

  
	

   

  
	

  Date: 

  	

  5/21/02

  	

   

  
				

 

4

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