Document:

exhibit_10-38.htm

                                                                                                                                                                                                                                                                                                         Exhibit 10.38

REVOLVING PROMISSORY NOTE

 

Not to exceed $1,000,000.00 March 4, 2011

 

FOR VALUE RECEIVED, HSW International, Inc., a Delaware corporation (the “Company”), promises to pay to the order of Theorem Capital, LLC, a California limited liability company (together with its successors and assigned, the “Holder”), the principal sum of One Million Dollars ($1,000,000.00) or if less, the then aggregate unpaid principal amount of the “Loans” (as such term is defined in the Credit Agreement hereinafter defined) as may be borrowed by the Company under the Credit Agreement, and to pay interest to the Holder on the principal amount of this Note outstanding from time to time in accordance with the Credit Agreement.  This Note is the Note referred to in, and evidences indebtedness incurred under, the Senior Revolving Credit Agreement dated as of March 4, 2011 (herein, as it may be renewed, amended, modified or supplemented from time to time, called the “Credit Agreement”) between the Company and the Holder, as “Lender,” as defined therein.  Reference is made to the Credit Agreement for a statement of the terms and provisions thereof, including those under which the Company is permitted and required to make payments and repayments of principal of and interest on such indebtedness and under which such indebtedness may be declared to be immediately due and payable.

 

This Note is subject to the following additional provisions:

 

Section 1.                       Definitions.  Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Credit Agreement.

 

Section 2.                       Miscellaneous.

 

(a) Absolute Obligation.  No provision of this Note shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of, and interest on, this Note.

 

(b) Lost or Mutilated Note.  If this Note shall be mutilated, lost, stolen or destroyed, the Company shall execute and deliver, in exchange and substitution for and upon cancellation of a mutilated Note, or in lieu of or in substitution for a lost, stolen or destroyed Note, a new Note for the principal amount of this Note so mutilated, lost, stolen or destroyed but only upon receipt of evidence of such loss, theft or destruction of such Note, and of the ownership hereof, and an appropriate indemnity, if requested, all as reasonably requested by the Company.

 

(c) Governing Law.  All questions concerning the construction, validity, enforcement and interpretation of this Note shall be governed by and construed and enforced in accordance with the internal laws of the State of California, without regard to the principles of conflicts of law thereof.

 

(d) Waiver.  Any waiver by the Company or the Holder of a breach of any provision of this Note shall not operate as or be construed to be a waiver of any other breach of such provision or of any breach of any other provision of this Note.  The failure of the Company or the Holder to insist upon strict adherence to any term of this Note on one or more occasions shall not be considered a waiver or deprive that party of the right thereafter to insist upon strict adherence to that term or any other term of this Note.  Any waiver must be in writing.

 

  

  

  

(e) Severability.  If any provision of this Note is invalid, illegal or unenforceable, the balance of this Note shall remain in effect, and if any provision is inapplicable to any person or circumstance, it shall nevertheless remain applicable to all other persons and circumstances.  If it shall be found that any interest or other amount deemed interest due hereunder violates applicable laws governing usury, the applicable rate of interest due hereunder shall automatically be lowered to equal the maximum permitted rate of interest. The Company covenants (to the extent that it may lawfully do so) that it shall not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law or other law which would prohibit or forgive the Company from paying all or any portion of the principal of or interest on this Note as contemplated herein, wherever enacted, now or at any time hereafter in force, or which may affect the covenants or the performance of this Note, and the Company (to the extent it may lawfully do so) hereby expressly waives all benefits or advantage of any such law, and covenants that it will not, by resort to any such law, hinder, delay or impede the execution of any power herein granted to the Holder.

 

(f) Headings.  The headings contained herein are for convenience only, do not constitute a part of this Note and shall not be deemed to limit or affect any of the provisions hereof.

 

[Signature page follows]

  

  

  

IN WITNESS WHEREOF, the Company has caused this Note to be duly executed by a duly authorized officer as of the date first above indicated.

 

	  	
HSW INTERNATIONAL, INC.

 

 

By:       /s/Bradley T. Zimmer                                                         

Name: Bradley T. Zimmer            

Title:  Executive Vice President & General Counsel          

 

	
ATTEST:

	  
	  	  
	  	  
	  /s/Shawn Meredith	  
	
Name:   Shawn Meredith            

	  
	
Title:    Chief Financial Officerex10-24.htm

Exhibit 10.24

CONFIDENTIAL TREATMENT REQUESTED BY NOVABAY PHARMACEUTICALS, INC.

 

AMENDMENT N°2

 

TO THE COLLABORATION AND LICENSE AGREEMENT

 

THIS AMENDMENT N°2 (the “Amendment 2”) is entered into as of this 2nd day of December, 2010 (the “Amendment 2 Effective Date”), by and between NovaBay Pharmaceuticals, Inc., a Delaware corporation, having its principal place of business at 5980 Horton Street, Suite 550, Emeryville, California 94608 (“NovaBay”), and Galderma S.A. a Swiss corporation, having its principal place of business at World Trade Center – 2 avenue Gratte-Paille – CP 552 CH-1000 Lausanne, Switzerland (“Galderma”),

 

WHEREAS, Galderma and NovaBay Pharmaceuticals, Inc., a California Corporation (“NovaBay California”) have entered into a COLLABORATION AND LICENSE AGREEMENT, effective as of March 20, 2009, as subsequently amended on December 1, 2009 (collectively, the “Agreement”) under which they have agreed to collaborate to develop and obtain regulatory approval for, and commercialize, pharmaceutical products incorporating Collaboration Compounds in the Field;

 

WHEREAS, on June 29, 2010, NovaBay California merged into NovaBay Pharmaceuticals, Inc., a Delaware Corporation and the former assigned all rights and responsibilities to the latter pursuant to an Agreement and Plan of Merger dated June 25, 2010—the certificate of merger attached hereto as Schedule A; and

 

WHEREAS, the Parties now wish to further amend the Agreement, all as set forth in this Amendment 2 herein below.

 

NOW THEREFORE, in consideration of these premises and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by each Party, the Parties agree as follows:

 

	
1.

	
The Parties acknowledge and agree that pursuant to the Certificate of Merger effective June 29, 2010, a copy of which is attached as Exhibit A, NovaBay assumed and hereby assumes all rights and obligations of NovaBay California under this Amendment No. 2 and the Agreement.

 

	
2.

	
Definitions.  Unless otherwise defined in this Amendment 2, all terms appearing herein with a capital letter shall have the meaning set forth in the Agreement.

 

  

***Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Commission.

  

 

CONFIDENTIAL TREATMENT REQUESTED BY NOVABAY PHARMACEUTICALS, INC.

 

(a)           Replaced Definitions.  The following definitions in Sections 1.15, 1.24, 1.32, 1.55 and 1.62 shall replace in their entirety the corresponding sections in the Agreement:

1.15 “Continuation Period” shall mean the period beginning on October 1, 2010 and continuing through the remainder of the Agreement Term.

 

1.24 “Field” shall mean shall mean the prevention or treatment of any and all dermatological diseases and disorders in humans (i.e., diseases or disorders of the skin or nails including onychomycosis) but excluding diseases and disorders of the hair and any and all Rare Diseases, but shall exclude all Excluded Indications.  For clarity, the Field excludes the Excluded Field.

 

1.32 “Galderma Territory” shall mean (i) with respect to Impetigo Products, all jurisdictions in the world including Asia-Pacific other than the NovaBay Impetigo Territory and (ii) with respect to all Collaboration Products other than the Impetigo Products, all jurisdictions in the world other than the NovaBay Other Territory.

 

1.55 “NovaBay Territory” shall mean (i) with respect to Impetigo Products, the countries listed on Exhibit 1.55A hereto (the “NovaBay Impetigo Territory”) and (ii) with respect to all Collaboration Products other than the Impetigo Products, the countries listed on Exhibit 1.55B (the “NovaBay Other Territory”).

 

1.62 “Primary Indications” shall mean, collectively and individually, (i) onychomycosis and (ii) impetigo.

 

(b)           New Definitions.  The following definitions are hereby added to Article 1 of the Agreement:

“Asia-Pacific” shall mean the countries listed on Schedule A to this Amendment 2.

 

“Dermatology Field” shall mean (i) any and all applications in the Field, (ii) the prevention and treatment of diseases and disorders of the hair (including Rare Diseases thereof) and (iii) any Rare Disease comprising the prevention or treatment of diseases and disorders of the skin or nails.

 

“Onychomycosis Product” shall mean an Anti-Fungal Product that is labeled for (or Developed for) the treatment or prevention of onychomycosis in humans.

 

“Rare Disease” shall mean any disease or condition that meets the criteria for an orphan or rare disease or condition in a Major Market, including, for example in the United States, in §526(a)(2)(1) of the Federal Drug and Cosmetic Act (U.S. Orphan Drug Act (1983)); in Europe, in the Orphan Drug Regulation 141/2000; and in Japan, in the Orphan Drug Amendment (1993).

 

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***Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Commission.

  

 

CONFIDENTIAL TREATMENT REQUESTED BY NOVABAY PHARMACEUTICALS, INC.

 

	
3.

	
Continuation.  Galderma hereby elects to continue the Collaboration beyond the Initial Period as provided in Section 8.2 of the Agreement.  Accordingly, Galderma shall pay the Continuation Fee in the amount of $3,250,000 within eight (8) business days of the Amendment 2 Effective Date.  For clarity and notwithstanding anything in Section 8.2.1 to the contrary, NovaBay agrees the Continuation Fee despite being paid after 1 October 2010 shall be $3,250,000.

 

	
4.

	
FTE Funding: Development Activities.

 

(a)           During the Continuation Period.  Further in connection with the continuation, Galderma acknowledges its obligation to fund, effective as of 1 October 2010, NovaBay FTEs with respect to the research and non-clinical development of Collaboration Products in the Field in accordance with the provisions of Section 8.3.1 of the Agreement.  Accordingly, within eight (8) business days of receipt of invoice therefor, Galderma shall fund such activities for the period of 1 October — 31 December 2010 and thereafter fund such activities monthly in advance in accordance with Section 8.3.1(a).  In addition to the activities funded under the provisions of Section 8.3.1 of the Agreement, Galderma agrees to pay NovaBay $[***] within eight (8) business days of the Amendment 2 Effective Date, in consideration of other research and non-clinical developments of Collaboration Products for the period running from 1 October 2010, until 31 March 2011.  The increase of the FTE rate as described in Section 8.3.1 of the Agreement will be effective beginning with the calendar year 2011.

 

(b)           Activities Prior to Continuation.  The Parties acknowledge that NovaBay, at the request and for the benefit of Galderma, has performed at NovaBay’s own expense certain research and non-clinical development of Collaboration Products in the Field prior to 1 October 2010.  As partial reimbursement for such research and development activities, Galderma agrees to pay NovaBay $[***] within eight (8) business days of the Amendment 2 Effective Date.

 

(c)           Development Activities.  The Parties acknowledge that as set forth in Section 3.1 of the Agreement, Galderma shall have primary responsibility for the Development of Collaboration Products in the Field for the Galderma Territory.  Without limiting the foregoing, Galderma agrees that if it intends to utilize a Third Party to perform any such Development activities in accordance with Section 3.8 of the Agreement including for any Impetigo Product or any Onychomycosis Product, Galderma shall first discuss in good faith with NovaBay the possibility of NovaBay performing such activities, taking into consideration NovaBay’s capabilities and the requirements of the particular project(s).  If the Parties so agree that NovaBay will perform any such activities, then the Parties shall establish a plan and budget pursuant to which NovaBay shall perform such activities.  If after a period of thirty (30) days following initiation of the discussions, the Parties fail to reach an agreement, then Galderma shall be free to subcontract to any Third Party.

 

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***Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Commission.

  

 

CONFIDENTIAL TREATMENT REQUESTED BY NOVABAY PHARMACEUTICALS, INC.

 

	
5.

	
Expansion of the Field.  The Parties acknowledge that the Field as defined in this Amendment 2 has been expanded to include onychomycosis.  In consideration of such expansion, Galderma agrees to pay to NovaBay the following:

 

(a)           Expansion Fee.  $[***] within eight (8) business days of receipt of an invoice therefor, if Galderma decides to initiate a first POC study for an Onchomycosis Product.  This decision will be taken no later than January 31st 2011 ; in the event that Galderma fails to notify NovaBay of such decision on or before, January 31st 2011, then notwithstanding anything to the contrary the Field shall exclude onychomycosis for all purposes of the Agreement and accordingly Galderma shall have no rights with respect thereto.

 

(b)           Milestones for Onychomycosis Products.  Subject to Section 8.4.1 and Section 8.4.2 of the Agreement, Galderma shall pay to NovaBay the amounts set forth in the following table (each, an “Onychomycosis Milestone Payment”) upon the first achievement of the corresponding milestone event for the first Onychomycosis Product (each, a “Milestone Event”):

 

	

Milestone Event

	 	

Onychomycosis

Product

	
1. Acceptance of an IND

	 	 	[	***]
	
2. First successful completion of a Phase II Clinical Trial

	 	$	[	***]
	
3. First initiation of any Phase III Clinical Trial

	 	$	[	***]
	
4. First filing of an MAA in a Major Market

	 	$	[	***]
	
5. First receipt of a Marketing Approval in a Major Market

	 	$	[	***]

 

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***Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Commission.

  

 

CONFIDENTIAL TREATMENT REQUESTED BY NOVABAY PHARMACEUTICALS, INC.

 

(c)           Royalties.  The royalty for the Onychomycosis Products are subject to the provisions of Section 8.5 of the Agreement.  For the avoidance of doubt the rate for the Onychomycosis Products is the same as in Section 8.5.1 of the Agreement.

 

	
6.

	
Expansion of the Galderma Territory for Impetigo Products.  The Parties acknowledge that Galderma is interested that the Galderma Territory with respect to the Impetigo Products be expanded to include Asia-Pacific territory.  In consideration of such expansion, Galderma agrees to pay to NovaBay the following:

 

(a)           Expansion Fee.  $[***] within eight (8) business days of receipt of an invoice therefor; if Galderma decides to include Asia — Pacific Territory in the Galderma Territory.  This decision will not be later than January 31st, 2011; in the event that Galderma fails to notify NovaBay of such decision on or before, January 31st, 2011, then notwithstanding anything to the contrary the Galderma Territory for the Impetigo Products shall exclude Asia-Pacific for all purposes of the Agreement and accordingly Galderma shall not have the right to Develop or Commercialize Impetigo Product therein.

 

(b)           Milestone for Inclusion of Asia-Pacific.  $[***] within thirty (30) of the first receipt of Marketing Approval in a country in the Asia-Pacific territory.

 

	
7.

	
Payment of the Impetigo Reimbursement Amount.  Notwithstanding Section 8.2.2, the payment of the Impetigo Reimbursement Amount shall become due and payable by Galderma to NovaBay upon decision by Galderma to initiate a Phase III Clinical Trial for an Impetigo Product, which decision shall occur no later than 30 September 2012.  The Parties hereby agree that the Impetigo Reimbursement Amount shall be $[***].

 

	
8.

	
Payment of the Milestone Payment for Milestone Event 2 for an Impetigo Product.  Notwithstanding Section 8.4, the payment of Milestone Event 2 for an Impetigo Product shall be due and payable upon the successful completion of the first Phase II Clinical Trial for an Impetigo Product initiated after the Amendment 2 Effective Date.

 

	
9.

	
No Other Amendment.  Except as otherwise provided in this Amendment 2, all other terms and conditions of the Agreement shall remain in full force and effect.

 

[The remainder of this page left blank intentionally; signature page follows.]

 

 

 

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***Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Commission.

  

 

CONFIDENTIAL TREATMENT REQUESTED BY NOVABAY PHARMACEUTICALS, INC.

 

IN WITNESS WHEREOF, the Parties have caused this AMENDMENT N°2 TO THE COLLABORATION AND LICENSE AGREEMENT to be duly executed, effective as of the Effective Date, by their respective duly authorized officers.

 

 

	 	GALDERMA	 	 	 NOVABAY	 
	 	 	 	 	 	 
	 By: 	/s/Humberto C Antunes	 	 By: 	/s/ Ramin Najafi	 
	 	 	 	 	 	 
	 Name:	Humberto C Antunes	 	 Name:	 Ramin "Ron" Najafi, Ph.D.	 
	 	 	 	 	 	 
	 Title: 	CEO	 	 Title:	 CEO & Chairman	 
	 	 	 	 	 	 

                                  

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***Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Commission.

  

 

CONFIDENTIAL TREATMENT REQUESTED BY NOVABAY PHARMACEUTICALS, INC.

	
EXHIBIT 1.55

	
NOVABAY TERRITORY

	
EXHIBIT 1.55A

	  
	
NOVABAY IMPETIGO TERRITORY

	  
	
* indicates this country is subject to the provisions of Section 4.6

	  
	
Afghanistan

	
Oman

	
Bahrain

	
Palestine*

	
Iran

	
Qatar

	
Iraq

	
Saudi Arabia*

	
Israel*

	
Syria*

	
Jordan*

	
Turkey*

	
Kuwait*

	
United Arab Emirates*

	
Lebanon*

	
Yemen

	
EXHIBIT 1.55B

	  
	
NOVABAY OTHER TERRITORY

	  
	
* indicates this country is subject to the provisions of Section 4.6

	  
	
Afghanistan

	
Kiribati

	
Bahrain

	
Kuwait*

	
Bangladesh

	
Kyrgyz

	
Bhutan

	
Laos

	
Brunei

	
Lebanon*

	
Cambodia

	
Malaysia

 

  

***Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Commission.

  

 

CONFIDENTIAL TREATMENT REQUESTED BY NOVABAY PHARMACEUTICALS, INC.

 

	
China, The People’s Republic

	  
	
(including Hong Kong and Macao)

	
Maldives

	
Cook Islands

	
Marshall Islands

	
East Timor

	
Micronesia

	
Fiji

	
Mongolia

	
India

	
Myanmar

	
Indonesia

	
Nauru

	
Iran

	
Nepal

	
Iraq

	
Niue

	
Israel*

	
North Korea

	
Jordan*

	
Oman

	
Kazakhstan

	
Pakistan

	
Palau

	
Taiwan (Republic of China)

	
Palestine*

	
Tajikistan

	
Papua New Guinea

	
Thailand

	
Philippines

	
Tonga

	
Qatar

	
Turkey*

	
Samoa

	
Turkmenistan

	
Saudi Arabia*

	
Tuvalu

	
Singapore

	
United Arab Emirates*

 

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***Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Commission.

  

 

CONFIDENTIAL TREATMENT REQUESTED BY NOVABAY PHARMACEUTICALS, INC.

 

	
Solomon Islands

	
Uzbekistan

	
South Korea

	
Vanuatu

	
Sri Lanka

	
Viet Nam

	
Syria*

	
Yemen

 

 

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***Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Commission.

  

 

CONFIDENTIAL TREATMENT REQUESTED BY NOVABAY PHARMACEUTICALS, INC.

 

SCHEDULE A

ASIA - PACIFIC

 

	
Bangladesh

	
Tonga

	
Bhutan

	
Tuvalu

	
Brunei

	
Vanuatu

	
Cambodia

	
Viet Nam

	
China, The People’s Republic

	  
	
(including Hong Kong and Macao)

	  
	
Cook Islands

	  
	
East Timor

	  
	
Fiji

	  
	
India

	  
	
Indonesia

	  
	
Kiribati

	  
	
Laos

	  
	
Malaysia

	  
	
Maldives

	  
	
Marshall Islands

	  
	
Micronesia

	  
	
Mongolia

	  
	
Myanmar

	  
	
Nauru

	  

 

  

***Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Commission.

  

 

CONFIDENTIAL TREATMENT REQUESTED BY NOVABAY PHARMACEUTICALS, INC.

 

	
Nepal

	  
	
Niue

	  
	
North Korea

	  
	
Palau

	  
	
Papua New Guinea

	  
	
Philippines

	  
	
Samoa

	  
	
Singapore

	  
	
Solomon Islands

	  
	
South Korea

	  
	
Sri Lanka

	  
	
Taiwan (Republic of China)

	  
	
Thailand

	  

 

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***Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Commission.

  

 

SCHEDULE A

 

[Attached behind]

 

  

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CONFIDENTIAL TREATMENT REQUESTED BY NOVABAY PHARMACEUTICALS, INC.

 

 

 

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***Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Commission.

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