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Market acceptance of our product candidates, if we receive approval, depends on a number of factors, including the: ● efficacy and safety of our product candidates, or our product candidates administered with other drugs, each as demonstrated in clinical trials and post-marketing experience; ● clinical indications for which our product candidates are approved; ● recommendation of physicians and patients of our product candidates as safe and effective treatments; ● potential and perceived advantages of our product candidates over alternative treatments; ● prevalence and severity of any side effects; ● product labeling or product insert requirements of the FDA or other regulatory authorities; ● timing of market introduction of our product candidates as well as competitive products; ● cost of treatment in relation to any alternative treatments available; ● availability of coverage and adequate reimbursement and pricing by government and private payers; ● relative convenience and ease of administration; and ● effectiveness of our sales and marketing efforts. |
We plan to seek regulatory approval for our product candidates outside of the United States, and accordingly, we expect that we will be subject to additional risks related to operating in foreign countries if we obtain the necessary approvals, including but not limited to: ● differing regulatory requirements in foreign countries; ● the potential local sellers importing goods from a foreign market with low or lower prices rather than buying them locally from us; ● unexpected changes in tariffs, trade barriers, price and exchange controls and other regulatory requirements; ● economic weakness, including inflation, or political instability in particular foreign economies and markets; ● costs of compliance with tax, employment, immigration and labor laws for employees living or traveling abroad; ● foreign taxes, including withholding of payroll taxes; ● foreign currency fluctuations, which could result in increased operating expenses and reduced revenues; ● difficulties staffing and managing foreign operations; ● workforce uncertainty in countries where labor unrest is more common than in the United States; ● challenges enforcing our contractual and intellectual property rights, especially in those foreign countries that do not respect and protect intellectual property rights to the same extent as the United States; ● production shortages resulting from any events affecting raw material supply or manufacturing capabilities abroad; and ● business interruptions resulting from geo-political actions, including war and terrorism. |
Restrictions under applicable federal and state healthcare laws and regulations that may affect our operations and expose us to areas of risk including the following: ● the federal Anti-Kickback Statute, which prohibits, among other things, persons from knowingly and will fully soliciting, offering, receiving or providing remuneration, directly or indirectly, in cash or in kind, to induce or reward, or in return for, either the referral of an individual for, or the purchase, order or recommendation of, any good or service, for which payment may be made under a federal healthcare program such as Medicare and Medicaid; ● federal civil and criminal false claims laws and civil monetary penalty laws, which impose criminal and civil penalties, including through civil whistleblower or qui tam actions, against individuals or entities for knowingly presenting, or causing to be presented, to the federal government, including the Medicare and Medicaid programs, claims for payment that are false or fraudulent or making a false statement to avoid, decrease or conceal an obligation to pay money to the federal government; ● the federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, which imposes criminal and civil liability for executing a scheme to defraud any healthcare benefit program and also created federal criminal laws that prohibit knowingly and will fully falsifying, concealing or covering up a material fact or making any materially false statements in connection with the delivery of or payment for healthcare benefits, items or services; ● HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act, which also imposes obligations, including mandatory contractual terms, with respect to safeguarding the privacy, security and transmission of individually identifiable health information; ● the Affordable Care Act, which requires manufacturers of vaccines, drugs, devices, biologics and medical supplies that are reimbursable under Medicare, Medicaid or Children's Health Insurance Program to report annually to HHS information related to payments and other transfers of value to physicians and teaching hospitals, and ownership and investment interests held by physicians and their immediate family members and applicable group purchasing organizations; and ● analogous state and foreign laws and regulations, such as state anti-kickback and false claims laws, which may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third party payers, including private insurers; some state laws require pharmaceutical companies to comply with the pharmaceutical industry's voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government and may require vaccine and drug manufacturers to report information related to payments and other transfers of value to physicians and other healthcare providers or marketing expenditures; and state and foreign laws govern the privacy and security of health information in specified circumstances, many of which differ from each other in significant ways and often are not preempted by HIPAA, thus complicating compliance efforts. |
On October 9, 2013 this agreement was renegotiated and amended to link the progress of the related technology to milestones, which was reflected in the following financial considerations: Milestone payments: By December 2013: E100 (paid in February 2014) Start of a second phase I: E50 Positive results of second phase I: E100 Positive results of phase II: E310 Start of phase III: E1,000 Positive results of phase III: E740 Receipt of BLA Authorization: E1,000 Royalty payments in case of direct or indirect commercialization: For sales below E250,000: 1% For sales between E250,000 and E500,000: 2% For sales more than E500,000: 3% The Exploitation Agreement terminates upon the later of: the expiration date of the longest-lived patent, or, 10 years after the first date of commercialization of the product, unless terminated by INSERM following market approval of the HIV products in the event (i)Mymetics does not develop the product for a period more than six months, (ii) the exploitation of the product is interrupted for a period of more than twelve months, or (iii) there is an absence of sales for twelve months starting from the date of market approval. |
Our future funding requirements, both near and long-term, will depend on many factors, including, but not limited to the: - initiation, progress, timing, costs and results of pre-clinical studies and clinical trials, including patient enrolment in such trials, for our product candidates or any other future product candidates; - clinical development plans we establish for our current product candidates and any other future vaccine product candidates; - number and characteristics of vaccine product candidates that we develop or in-license; - outcome, timing and cost of regulatory review by the Food and Drug Administration, or FDA, and comparable foreign regulatory authorities, including the potential for the FDA or comparable foreign regulatory authorities to require that we perform more studies than those that we currently expect; - costs of filing, prosecuting, defending and enforcing any patent claims and maintaining and enforcing other intellectual property rights; - effects of competing technological and market developments; - costs and timing of the implementation of commercial-scale manufacturing activities; and - costs and timing of establishing sales, marketing and distribution capabilities for any product candidates for which we may receive regulatory approval. |
Our ability to generate revenue from product sales from our current or future product candidates also depends on a number of additional factors, including our ability to: - successfully complete development activities, including enrolment of study participants and completion of the necessary clinical trials; - complete and submit new drug applications, or NDAs, to the FDA, and obtain regulatory approval for indications for which there is a commercial market; - complete and submit applications to, and obtain regulatory approval from, foreign regulatory authorities; - make or have made commercial quantities of our products at acceptable cost levels; - develop a commercial organization capable of manufacturing, selling, marketing and distributing any products we intend to sell ourselves; - find suitable partners to help us market, sell and distribute our approved products in markets other than the markets in which we choose to commercialize on our own; and - obtain adequate pricing, coverage and reimbursement from third parties, including government and private payers. |
Our outstanding indebtedness combined with our other financial obligations and contractual commitments, including any additional indebtedness beyond our borrowings under our secured convertible notes issued to Round Enterprises and Eardley Holding, could have significant adverse consequences, including: - requiring us to dedicate a portion of our cash resources to the payment of interest and principal, and prepayment and repayment fees and penalties, thereby reducing money available to fund working capital, capital expenditures, product development and other general corporate purposes; - increasing our vulnerability to adverse changes in general economic, industry and market conditions; - subjecting us to restrictive covenants that may reduce our ability to take certain corporate actions or obtain further debt or equity financing; - limiting our flexibility in planning for, or reacting to, changes in our business and the industry in which we compete; and - placing us at a competitive disadvantage compared to our competitors that have less debt or better debt servicing options. |
Clinical trials may be delayed, suspended or prematurely terminated for a variety of other reasons, such as: - delay or failure in reaching agreement with the FDA or a comparable foreign regulatory authority on a trial design that we are able to execute; - delay or failure in obtaining authorization to commence a trial or inability to comply with conditions imposed by a regulatory authority regarding the scope or design of a clinical trial; - delay or failure in reaching agreement on acceptable terms with prospective clinical research organizations, or CROs, and clinical trial sites, the terms of which can be subject to extensive negotiation and may vary significantly among different CROs and trial sites; - delay or failure in obtaining institutional review board, or IRB, approval or the approval of other reviewing entities, including comparable foreign regulatory authorities, to conduct a clinical trial at each site; - withdrawal of clinical trial sites from our clinical trials as a result of changing standards of care or the ineligibility of a site to participate in our clinical trials; - delay or failure in recruiting and enrolling suitable study subjects to participate in a trial; - delay or failure in study subjects completing a trial or returning for post-treatment follow-up; - clinical sites and investigators deviating from a trial protocol, failing to conduct the trial in accordance with regulatory requirements, or dropping out of a trial; - inability to identify and maintain a sufficient number of trial sites, many of which may already be engaged in other clinical trial programs, including some that may be for competing product candidates with the same or similar indication; - failure of our third party clinical trial managers to satisfy their contractual duties or meet expected deadlines; - delay or failure in adding new clinical trial sites; - ambiguous or negative interim results or results that are inconsistent with earlier results; - feedback from the FDA, the IRB, data safety monitoring boards, or a comparable foreign regulatory authority, or results from earlier stage or concurrent pre-clinical studies and clinical trials, that might require modification to the protocol for the trial; - decision by the FDA, the IRB, a comparable foreign regulatory authority, or us, or recommendation by a data safety monitoring board or comparable foreign regulatory authority, to suspend or terminate clinical trials at any time for safety issues or for any other reason; - unacceptable risk-benefit profile, unforeseen safety issues or adverse side effects or adverse events; - failure of a product candidate to demonstrate any benefit; - difficulties in manufacturing sufficient quantities of a product candidate for use in clinical trials; - lack of adequate funding to continue the clinical trial, including the incurrence of unforeseen costs due to enrolment delays, requirements to conduct additional clinical trials or increased expenses associated with the services of our CROs, clinical trial sites and other third parties; or - changes in governmental regulations or administrative actions. |
Market acceptance of our product candidates, if we receive approval, depends on a number of factors, including the: - efficacy and safety of our product candidates, or our product candidates administered with other drugs, each as demonstrated in clinical trials and post-marketing experience; - clinical indications for which our product candidates are approved; - recommendation of physicians and patients of our product candidates as safe and effective treatments; - potential and perceived advantages of our product candidates over alternative treatments; - prevalence and severity of any side effects; - product labeling or product insert requirements of the FDA or other regulatory authorities; - timing of market introduction of our product candidates as well as competitive products; - cost of treatment in relation to any alternative treatments available; - availability of coverage and adequate reimbursement and pricing by government and private payers; - relative convenience and ease of administration; and - effectiveness of our sales and marketing efforts. |
We plan to seek regulatory approval for our product candidates outside of the United States, and accordingly, we expect that we will be subject to additional risks related to operating in foreign countries if we obtain the necessary approvals, including but not limited to: - differing regulatory requirements in foreign countries; - the potential local sellers importing goods from a foreign market with low or lower prices rather than buying them locally from us; - unexpected changes in tariffs, trade barriers, price and exchange controls and other regulatory requirements; - economic weakness, including inflation, or political instability in particular foreign economies and markets; - costs of compliance with tax, employment, immigration and labor laws for employees living or traveling abroad; - foreign taxes, including withholding of payroll taxes; - foreign currency fluctuations, which could result in increased operating expenses and reduced revenues; - difficulties staffing and managing foreign operations; - workforce uncertainty in countries where labor unrest is more common than in the United States; - challenges enforcing our contractual and intellectual property rights, especially in those foreign countries that do not respect and protect intellectual property rights to the same extent as the United States; - production shortages resulting from any events affecting raw material supply or manufacturing capabilities abroad; and - business interruptions resulting from geo-political actions, including war and terrorism. |
Restrictions under applicable federal and state healthcare laws and regulations that may affect our operations and expose us to areas of risk including the following: - the federal Anti-Kickback Statute, which prohibits, among other things, persons from knowingly and will fully soliciting, offering, receiving or providing remuneration, directly or indirectly, in cash or in kind, to induce or reward, or in return for, either the referral of an individual for, or the purchase, order or recommendation of, any good or service, for which payment may be made under a federal healthcare program such as Medicare and Medicaid; - federal civil and criminal false claims laws and civil monetary penalty laws, which impose criminal and civil penalties, including through civil whistleblower or qui tam actions, against individuals or entities for knowingly presenting, or causing to be presented, to the federal government, including the Medicare and Medicaid programs, claims for payment that are false or fraudulent or making a false statement to avoid, decrease or conceal an obligation to pay money to the federal government; - the federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, which imposes criminal and civil liability for executing a scheme to defraud any healthcare benefit program and also created federal criminal laws that prohibit knowingly and will fully falsifying, concealing or covering up a material fact or making any materially false statements in connection with the delivery of or payment for healthcare benefits, items or services; - HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act, which also imposes obligations, including mandatory contractual terms, with respect to safeguarding the privacy, security and transmission of individually identifiable health information; - the Affordable Care Act, which requires manufacturers of vaccines, drugs, devices, biologics and medical supplies that are reimbursable under Medicare, Medicaid or Children's Health Insurance Program to report annually to HHS information related to payments and other transfers of value to physicians and teaching hospitals, and ownership and investment interests held by physicians and their immediate family members and applicable group purchasing organizations; and - analogous state and foreign laws and regulations, such as state anti-kickback and false claims laws, which may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third party payers, including private insurers; some state laws require pharmaceutical companies to comply with the pharmaceutical industry's voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government and may require vaccine and drug manufacturers to report information related to payments and other transfers of value to physicians and other healthcare providers or marketing expenditures; and state and foreign laws govern the privacy and security of health information in specified circumstances, many of which differ from each other in significant ways and often are not preempted by HIPAA, thus complicating compliance efforts. |
On October 9, 2013 this agreement was renegotiated and amended to link the progress of the related technology to milestones, which was reflected in the following financial considerations: Milestone payments: By December 2013: E100,000 (paid in February 2014) Start of a second phase I: E50,000 Positive results of second phase I: E100,000 Positive results of phase II: E310,000 Start of phase III: E1,000,000 Positive results of phase III: E740,000 Receipt of BLA Authorization: E1,000,000 Royalty payments in case of direct or indirect commercialization: For sales below E250,000,000: 1% For sales between E250,000,000 and E500,000,000: 2% For sales more than E500,000,000: 3% The Exploitation Agreement terminates upon the later of: the expiration date of the longest-lived patent, or, 10 years after the first date of commercialization of the product, unless terminated by INSERM following market approval of the HIV products in the event (i)Mymetics does not develop the product for a period more than six months, (ii) the exploitation of the product is interrupted for a period of more than twelve months, or (iii) there is an absence of sales for twelve months starting from the date of market approval. |
Our future funding requirements, both near and long-term, will depend on many factors, including, but not limited to the: - initiation, progress, timing, costs and results of pre-clinical studies and clinical trials, including patient enrolment in such trials, for our product candidates or any other future product candidates; - clinical development plans we establish for our current product candidates and any other future vaccine product candidates; - number and characteristics of vaccine product candidates that we develop or in-license; - outcome, timing and cost of regulatory review by the Food and Drug Administration, or FDA, and comparable foreign regulatory authorities, including the potential for the FDA or comparable foreign regulatory authorities to require that we perform more studies than those that we currently expect; - costs of filing, prosecuting, defending and enforcing any patent claims and maintaining and enforcing other intellectual property rights; - effects of competing technological and market developments; - costs and timing of the implementation of commercial-scale manufacturing activities; and - costs and timing of establishing sales, marketing and distribution capabilities for any product candidates for which we may receive regulatory approval. |
Our ability to generate revenue from product sales from our current or future product candidates also depends on a number of additional factors, including our ability to: - successfully complete development activities, including enrolment of study participants and completion of the necessary clinical trials; - complete and submit new drug applications, or NDAs, to the FDA, and obtain regulatory approval for indications for which there is a commercial market; - complete and submit applications to, and obtain regulatory approval from, foreign regulatory authorities; - make or have made commercial quantities of our products at acceptable cost levels; - develop a commercial organization capable of manufacturing, selling, marketing and distributing any products we intend to sell ourselves; - find suitable partners to help us market, sell and distribute our approved products in markets other than the markets in which we choose to commercialize on our own; and - obtain adequate pricing, coverage and reimbursement from third parties, including government and private payers. |
Our outstanding indebtedness combined with our other financial obligations and contractual commitments, including any additional indebtedness beyond our borrowings under our secured convertible notes issued to Round Enterprises and Eardley Holding, could have significant adverse consequences, including: - requiring us to dedicate a portion of our cash resources to the payment of interest and principal, and prepayment and repayment fees and penalties, thereby reducing money available to fund working capital, capital expenditures, product development and other general corporate purposes; - increasing our vulnerability to adverse changes in general economic, industry and market conditions; - subjecting us to restrictive covenants that may reduce our ability to take certain corporate actions or obtain further debt or equity financing; - limiting our flexibility in planning for, or reacting to, changes in our business and the industry in which we compete; and - placing us at a competitive disadvantage compared to our competitors that have less debt or better debt servicing options. |
Clinical trials may be delayed, suspended or prematurely terminated for a variety of other reasons, such as: - delay or failure in reaching agreement with the FDA or a comparable foreign regulatory authority on a trial design that we are able to execute; - delay or failure in obtaining authorization to commence a trial or inability to comply with conditions imposed by a regulatory authority regarding the scope or design of a clinical trial; - delay or failure in reaching agreement on acceptable terms with prospective clinical research organizations, or CROs, and clinical trial sites, the terms of which can be subject to extensive negotiation and may vary significantly among different CROs and trial sites; - delay or failure in obtaining institutional review board, or IRB, approval or the approval of other reviewing entities, including comparable foreign regulatory authorities, to conduct a clinical trial at each site; - withdrawal of clinical trial sites from our clinical trials as a result of changing standards of care or the ineligibility of a site to participate in our clinical trials; - delay or failure in recruiting and enrolling suitable study subjects to participate in a trial; - delay or failure in study subjects completing a trial or returning for post-treatment follow-up; - clinical sites and investigators deviating from a trial protocol, failing to conduct the trial in accordance with regulatory requirements, or dropping out of a trial; - inability to identify and maintain a sufficient number of trial sites, many of which may already be engaged in other clinical trial programs, including some that may be for competing product candidates with the same or similar indication; - failure of our third party clinical trial managers to satisfy their contractual duties or meet expected deadlines; - delay or failure in adding new clinical trial sites; - ambiguous or negative interim results or results that are inconsistent with earlier results; - feedback from the FDA, the IRB, data safety monitoring boards, or a comparable foreign regulatory authority, or results from earlier stage or concurrent pre-clinical studies and clinical trials, that might require modification to the protocol for the trial; - decision by the FDA, the IRB, a comparable foreign regulatory authority, or us, or recommendation by a data safety monitoring board or comparable foreign regulatory authority, to suspend or terminate clinical trials at any time for safety issues or for any other reason; - unacceptable risk-benefit profile, unforeseen safety issues or adverse side effects or adverse events; - failure of a product candidate to demonstrate any benefit; - difficulties in manufacturing sufficient quantities of a product candidate for use in clinical trials; - lack of adequate funding to continue the clinical trial, including the incurrence of unforeseen costs due to enrolment delays, requirements to conduct additional clinical trials or increased expenses associated with the services of our CROs, clinical trial sites and other third parties; or - changes in governmental regulations or administrative actions. |
Market acceptance of our product candidates, if we receive approval, depends on a number of factors, including the: - efficacy and safety of our product candidates, or our product candidates administered with other drugs, each as demonstrated in clinical trials and post-marketing experience; - clinical indications for which our product candidates are approved; - recommendation of physicians and patients of our product candidates as safe and effective treatments; - potential and perceived advantages of our product candidates over alternative treatments; - prevalence and severity of any side effects; - product labeling or product insert requirements of the FDA or other regulatory authorities; - timing of market introduction of our product candidates as well as competitive products; - cost of treatment in relation to any alternative treatments available; - availability of coverage and adequate reimbursement and pricing by government and private payers; - relative convenience and ease of administration; and - effectiveness of our sales and marketing efforts. |
We plan to seek regulatory approval for our product candidates outside of the United States, and accordingly, we expect that we will be subject to additional risks related to operating in foreign countries if we obtain the necessary approvals, including but not limited to: - differing regulatory requirements in foreign countries; - the potential local sellers importing goods from a foreign market with low or lower prices rather than buying them locally from us; - unexpected changes in tariffs, trade barriers, price and exchange controls and other regulatory requirements; - economic weakness, including inflation, or political instability in particular foreign economies and markets; - costs of compliance with tax, employment, immigration and labor laws for employees living or traveling abroad; - foreign taxes, including withholding of payroll taxes; - foreign currency fluctuations, which could result in increased operating expenses and reduced revenues; - difficulties staffing and managing foreign operations; - workforce uncertainty in countries where labor unrest is more common than in the United States; - challenges enforcing our contractual and intellectual property rights, especially in those foreign countries that do not respect and protect intellectual property rights to the same extent as the United States; - production shortages resulting from any events affecting raw material supply or manufacturing capabilities abroad; and - business interruptions resulting from geo-political actions, including war and terrorism. |
Restrictions under applicable federal and state healthcare laws and regulations that may affect our operations and expose us to areas of risk including the following: - the federal Anti-Kickback Statute, which prohibits, among other things, persons from knowingly and willfully soliciting, offering, receiving or providing remuneration, directly or indirectly, in cash or in kind, to induce or reward, or in return for, either the referral of an individual for, or the purchase, order or recommendation of, any good or service, for which payment may be made under a federal healthcare program such as Medicare and Medicaid; - federal civil and criminal false claims laws and civil monetary penalty laws, which impose criminal and civil penalties, including through civil whistleblower or qui tam actions, against individuals or entities for knowingly presenting, or causing to be presented, to the federal government, including the Medicare and Medicaid programs, claims for payment that are false or fraudulent or making a false statement to avoid, decrease or conceal an obligation to pay money to the federal government; - the federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, which imposes criminal and civil liability for executing a scheme to defraud any healthcare benefit program and also created federal criminal laws that prohibit knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false statements in connection with the delivery of or payment for healthcare benefits, items or services; - HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act, which also imposes obligations, including mandatory contractual terms, with respect to safeguarding the privacy, security and transmission of individually identifiable health information; - the Affordable Care Act, which requires manufacturers of vaccines, drugs, devices, biologics and medical supplies that are reimbursable under Medicare, Medicaid or Children's Health Insurance Program to report annually to HHS information related to payments and other transfers of value to physicians and teaching hospitals, and ownership and investment interests held by physicians and their immediate family members and applicable group purchasing organizations; and - analogous state and foreign laws and regulations, such as state anti-kickback and false claims laws, which may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third party payers, including private insurers; some state laws require pharmaceutical companies to comply with the pharmaceutical industry's voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government and may require vaccine and drug manufacturers to report information related to payments and other transfers of value to physicians and other healthcare providers or marketing expenditures; and state and foreign laws govern the privacy and security of health information in specified circumstances, many of which differ from each other in significant ways and often are not preempted by HIPAA, thus complicating compliance efforts. |
On October 9, 2013 this agreement was renegotiated and amended to link the progress of the related technology to milestones, which was reflected in the following financial considerations: Milestone payments: By December 2013: E100,000 (paid in February 2014) Start of a second phase I: E50,000 Positive results of second phase I: E100,000 Positive results of phase II: E310,000 Start of phase III: E1,000,000 Positive results of phase III: E740,000 Receipt of BLA Authorization: E1,000,000 Royalty payments in case of direct or indirect commercialization: For sales below E250,000,000: 1% For sales between E250,000,000 and E500,000,000: 2% For sales more than E500,000,000: 3% The Exploitation Agreement terminates upon the later of: the expiration date of the longest-lived patent, or, 10 years after the first date of commercialization of the product, unless terminated by INSERM following market approval of the HIV products in the event (i)Mymetics does not develop the product for a period more than six months, (ii) the exploitation of the product is interrupted for a period of more than twelve months, or (iii) there is an absence of sales for twelve months starting from the date of market approval. |
Our future funding requirements, both near and long-term, will depend on many factors, including, but not limited to the: ● initiation, progress, timing, costs and results of pre-clinical studies and clinical trials, including patient enrollment in such trials, for our product candidates or any other future product candidates; ● clinical development plans we establish for our current product candidates and any other future vaccine product candidates; ● number and characteristics of vaccine product candidates that we develop or in-license; ● outcome, timing and cost of regulatory review by the Food and Drug Administration, or FDA, and comparable foreign regulatory authorities, including the potential for the FDA or comparable foreign regulatory authorities to require that we perform more studies than those that we currently expect; ● costs of filing, prosecuting, defending and enforcing any patent claims and maintaining and enforcing other intellectual property rights; ● effects of competing technological and market developments; ● costs and timing of the implementation of commercial-scale manufacturing activities; and ● costs and timing of establishing sales, marketing and distribution capabilities for any product candidates for which we may receive regulatory approval. |
Our ability to generate revenue from product sales from our current or future product candidates also depends on a number of additional factors, including our ability to: ● successfully complete development activities, including enrollment of study participants and completion of the necessary clinical trials; ● complete and submit new drug applications, or NDAs, to the FDA, and obtain regulatory approval for indications for which there is a commercial market; ● complete and submit applications to, and obtain regulatory approval from, foreign regulatory authorities; ● make or have made commercial quantities of our products at acceptable cost levels; ● develop a commercial organization capable of manufacturing, selling, marketing and distributing any products we intend to sell ourselves; ● find suitable partners to help us market, sell and distribute our approved products in markets other than the markets in which we choose to commercialize on our own; and ● obtain adequate pricing, coverage and reimbursement from third parties, including government and private payors. |
Our outstanding indebtedness combined with our other financial obligations and contractual commitments, including any additional indebtedness beyond our borrowings under our secured convertible notes issued to Round Enterprises and Eardley Holding, could have significant adverse consequences, including: ● requiring us to dedicate a portion of our cash resources to the payment of interest and principal, and prepayment and repayment fees and penalties, thereby reducing money available to fund working capital, capital expenditures, product development and other general corporate purposes; ● increasing our vulnerability to adverse changes in general economic, industry and market conditions; ● subjecting us to restrictive covenants that may reduce our ability to take certain corporate actions or obtain further debt or equity financing; ● limiting our flexibility in planning for, or reacting to, changes in our business and the industry in which we compete; and ● placing us at a competitive disadvantage compared to our competitors that have less debt or better debt servicing options. |
Clinical trials may be delayed, suspended or prematurely terminated for a variety of other reasons, such as: ● delay or failure in reaching agreement with the FDA or a comparable foreign regulatory authority on a trial design that we are able to execute; ● delay or failure in obtaining authorization to commence a trial or inability to comply with conditions imposed by a regulatory authority regarding the scope or design of a clinical trial; ● delay or failure in reaching agreement on acceptable terms with prospective clinical research organizations, or CROs, and clinical trial sites, the terms of which can be subject to extensive negotiation and may vary significantly among different CROs and trial sites; ● delay or failure in obtaining institutional review board, or IRB, approval or the approval of other reviewing entities, including comparable foreign regulatory authorities, to conduct a clinical trial at each site; ● withdrawal of clinical trial sites from our clinical trials as a result of changing standards of care or the ineligibility of a site to participate in our clinical trials; ● delay or failure in recruiting and enrolling suitable study subjects to participate in a trial; ● delay or failure in study subjects completing a trial or returning for post-treatment follow-up; ● clinical sites and investigators deviating from a trial protocol, failing to conduct the trial in accordance with regulatory requirements, or dropping out of a trial; ● inability to identify and maintain a sufficient number of trial sites, many of which may already be engaged in other clinical trial programs, including some that may be for competing product candidates with the same or similar indication; ● failure of our third party clinical trial managers to satisfy their contractual duties or meet expected deadlines; ● delay or failure in adding new clinical trial sites; ● ambiguous or negative interim results or results that are inconsistent with earlier results; ● feedback from the FDA, the IRB, data safety monitoring boards, or a comparable foreign regulatory authority, or results from earlier stage or concurrent pre-clinical studies and clinical trials, that might require modification to the protocol for the trial; ● decision by the FDA, the IRB, a comparable foreign regulatory authority, or us, or recommendation by a data safety monitoring board or comparable foreign regulatory authority, to suspend or terminate clinical trials at any time for safety issues or for any other reason; ● unacceptable risk-benefit profile, unforeseen safety issues or adverse side effects or adverse events; ● failure of a product candidate to demonstrate any benefit; ● difficulties in manufacturing sufficient quantities of a product candidate for use in clinical trials; ● lack of adequate funding to continue the clinical trial, including the incurrence of unforeseen costs due to enrollment delays, requirements to conduct additional clinical trials or increased expenses associated with the services of our CROs, clinical trial sites and other third parties; or ● changes in governmental regulations or administrative actions. |
Market acceptance of our product candidates, if we receive approval, depends on a number of factors, including the: ● efficacy and safety of our product candidates, or our product candidates administered with other drugs, each as demonstrated in clinical trials and post-marketing experience; ● clinical indications for which our product candidates are approved; ● recommendation of physicians and patients of our product candidates as safe and effective treatments; ● potential and perceived advantages of our product candidates over alternative treatments; ● prevalence and severity of any side effects; ● product labeling or product insert requirements of the FDA or other regulatory authorities; ● timing of market introduction of our product candidates as well as competitive products; ● cost of treatment in relation to any alternative treatments available; ● availability of coverage and adequate reimbursement and pricing by government and private payors; ● relative convenience and ease of administration; and ● effectiveness of our sales and marketing efforts. |
We plan to seek regulatory approval for our product candidates outside of the United States, and accordingly, we expect that we will be subject to additional risks related to operating in foreign countries if we obtain the necessary approvals, including but not limited to: ● differing regulatory requirements in foreign countries; ● the potential local sellers importing goods from a foreign market with low or lower prices rather than buying them locally from us; ● unexpected changes in tariffs, trade barriers, price and exchange controls and other regulatory requirements; ● economic weakness, including inflation, or political instability in particular foreign economies and markets; ● costs of compliance with tax, employment, immigration and labor laws for employees living or traveling abroad; ● foreign taxes, including withholding of payroll taxes; ● foreign currency fluctuations, which could result in increased operating expenses and reduced revenues; ● difficulties staffing and managing foreign operations; ● workforce uncertainty in countries where labor unrest is more common than in the United States; ● challenges enforcing our contractual and intellectual property rights, especially in those foreign countries that do not respect and protect intellectual property rights to the same extent as the United States; ● production shortages resulting from any events affecting raw material supply or manufacturing capabilities abroad; and ● business interruptions resulting from geo-political actions, including war and terrorism. |
Restrictions under applicable federal and state healthcare laws and regulations that may affect our operations and expose us to areas of risk including the following: ● the federal Anti-Kickback Statute, which prohibits, among other things, persons from knowingly and willfully soliciting, offering, receiving or providing remuneration, directly or indirectly, in cash or in kind, to induce or reward, or in return for, either the referral of an individual for, or the purchase, order or recommendation of, any good or service, for which payment may be made under a federal healthcare program such as Medicare and Medicaid; ● federal civil and criminal false claims laws and civil monetary penalty laws, which impose criminal and civil penalties, including through civil whistleblower or qui tam actions, against individuals or entities for knowingly presenting, or causing to be presented, to the federal government, including the Medicare and Medicaid programs, claims for payment that are false or fraudulent or making a false statement to avoid, decrease or conceal an obligation to pay money to the federal government; ● the federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, which imposes criminal and civil liability for executing a scheme to defraud any healthcare benefit program and also created federal criminal laws that prohibit knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false statements in connection with the delivery of or payment for healthcare benefits, items or services; ● HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act, which also imposes obligations, including mandatory contractual terms, with respect to safeguarding the privacy, security and transmission of individually identifiable health information; ● the Affordable Care Act, which requires manufacturers of vaccines, drugs, devices, biologics and medical supplies that are reimbursable under Medicare, Medicaid or Children's Health Insurance Program to report annually to HHS information related to payments and other transfers of value to physicians and teaching hospitals, and ownership and investment interests held by physicians and their immediate family members and applicable group purchasing organizations; and ● analogous state and foreign laws and regulations, such as state anti-kickback and false claims laws, which may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third party payors, including private insurers; some state laws require pharmaceutical companies to comply with the pharmaceutical industry's voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government and may require vaccine and drug manufacturers to report information related to payments and other transfers of value to physicians and other healthcare providers or marketing expenditures; and state and foreign laws govern the privacy and security of health information in specified circumstances, many of which differ from each other in significant ways and often are not preempted by HIPAA, thus complicating compliance efforts. |
On October 9, 2013 this agreement was renegotiated and amended to link the progress of the related technology to milestones, which was reflected in the following financial considerations: Milestone payments: By December 2013: E100,000 (paid in February 2014) Start of a second phase I: E50,000 Positive results of second phase I: E100,000 Positive results of phase II: E310,000 Start of phase III: E1,000,000 Positive results of phase III: E740,000 Receipt of BLA Authorization: E1,000,000 Royalty payments in case of direct or indirect commercialization: For sales below E250,000,000: 1% For sales between E250,000,000 and E500,000,000: 2% For sales more than E500,000,000: 3% The Exploitation Agreement terminates upon the later of: the expiration date of the longest-lived patent, or, 10 years after the first date of commercialization of the product, unless terminated by INSERM following market approval of the HIV products in the event (i)Mymetics does not develop the product for a period more than six months, (ii) the exploitation of the product is interrupted for a period of more than twelve months, or (iii) there is an absence of sales for twelve months starting from the date of market approval. |
On October 9, 2013 this agreement was renegotiated and amended to link the progress of the related technology to milestones, which was reflected in the following financial considerations: Milestone payments: By December 2013: E100,000 (paid in February 2014) Start of a second phase I: E50,000 Positive results of second phase I: E100,000 Positive results of phase II: E310,000 Start of phase III: E1,000,000 Positive results of phase III: E740,000 Receipt of BLA Authorization: E1,000,000 Royalty payments in case of direct or indirect commercialization: For sales below E250,000,000: 1% For sales between E250,000,000 and E500,000,000: 2% For sales more than E500,000,000: 3% The Exploitation Agreement terminates upon the later of: the expiration date of the longest-lived patent, or, 10 years after the first date of commercialization of the product, unless terminated by INSERM following market approval of the HIV products in the event (i)Mymetics does not develop the product for a period more than six months, (ii) the exploitation of the product is interrupted for a period of more than twelve months, or (iii) there is an absence of sales for twelve months starting from the date of market approval. |
On October 9, 2013 this agreement was renegotiated and amended to link the progress of the related technology to milestones, which was reflected in the following financial considerations: Milestone payments: By December 2013: E100,000 Start of a second phase I: E50,000 Positive results of second phase I: E100,000 Positive results of phase II: E310,000 Start of phase III: E1,000,000 Positive results of phase III: E740,000 Receipt of BLA Authorization: E1,000,000 Royalty payments in case of direct or indirect commercialization: For sales below E250,000,000: 1% For sales between E250,000,000 and E500,000,000: 2% For sales more than E500,000,000: 3% The Exploitation Agreement terminates upon the later of: the expiration date of the longest-lived patent, or, 10 years after the first date of commercialization of the product, unless terminated by INSERM following market approval of the HIV products in the event (i)Mymetics does not develop the product for a period more than six months, (ii) the exploitation of the product is interrupted for a period of more than twelve months, or (iii) there is an absence of sales for twelve months starting from the date of market approval. |
(3) List of Exhibits 2.1 Share Exchange Agreement dated December 13, 2001 between the Corporation and the stockholders of Mymetics S.A. listed on the signature page thereto (1) 2.2 Share Exchange Agreement dated December 13, 2001 between the Company and the stockholders of Mymetics S.A. listed on the signature page thereto (1) 2.3 Purchase Agreement dated October 17, 1998 between the Company and the majority stockholders of Nazca Holdings Ltd. (2) 2.4 Amendment to the Purchase Agreement dated October 17, 1998 between the Company and the majority stockholders of Nazca Holdings Ltd. (3) 2.5 Revised Purchase Agreement dated July 28, 1999 between the Company and the majority stockholders of Nazca Holdings Ltd. (4) 2.6 Share Exchange Agreement dated July 30, 2002 between the Company and the stockholders of Mymetics S.A. listed on the signature page thereto (5) 3(i) Articles of Incorporation of the Company (as amended through May 10, 2002) (6) 3(ii) Bylaws (7) 4.1 Form of Specimen Stock Certificate (8) 4.2 Form of letter regarding Warrant (8) 4.3 Form of Share Exchange Agreement (8) 9.1 Voting and Exchange Trust Agreement dated March 19, 2001, among the Company, 6543 Luxembourg S.A. and MFC Merchant Bank S.A. (8) 10.1 Services Agreement dated May 31, 2001, between the Company and MFC Merchant Bank, S.A.(7) 10.2 Employment Agreement dated May 3, 2001, between Pierre-Francois Serres and the Company (7) 10.3 Indemnification Agreement dated March 19, 2001, between the Company and MFC Bancorp Ltd. (7) 10.4 Agreement dated for reference May 15, 2000, between the Company and Maarten Reidel (7) 10.5 Preferred Stock Redemption and Conversion Agreement dated for reference December 21, 2000, between the Company and Sutton Park International Ltd. (10) 10.6 Preferred Stock Conversion Agreement dated for reference December 21, 2000, between the Company and Med Net International Ltd. (11) 10.7 Preferred Stock Conversion Agreement dated December 21, 2000, between the Company and Dresden Papier GmbH (11) 10.8 Assignment Agreement dated December 29, 2000, among the Company, Mymetics S.A. and MFC Merchant Bank S.A. (1) 10.9 Credit Facility Agreement dated July 27, 2000, between MFC Merchant Bank, S.A. and the Company (1) 10.10 Amended Credit Facility Agreement dated for reference August 13, 2001, between MFC Merchant Bank, S.A. and the Company (16) 10.11 Second Amended Credit Facility Agreement dated for reference February 27, 2002, between MFC Merchant Bank, S.A. and the Company (16) 10.12 Amended and Restated Credit Facility Agreement dated for reference February 28, 2003, among MFC Merchant Bank, S.A., MFC Bancorp Ltd., and the Company (16) 10.13 Guarantee dated for reference February 28, 2003, by MFC Bancorp Ltd. to MFC Merchant Bank S.A. (16) 10.14 Shareholder Agreement dated March 19, 2001, among the Company, the Holders of Class B Exchangeable Preferential Non-Voting Shares of 6543 Luxembourg S.A. signatory thereto and 6543 Luxembourg S.A.(8) 10.15 Support Agreement dated March 19, 2001, between the Company and 6543 Luxembourg S.A. (8) 10.16 1995 Qualified Incentive Stock Option Plan (12) 10.17 Amended 1994 Stock Option Plan (13) 10.18 2001 ICHOR Company Stock Option Plan (7) 10.19 Employment Agreement dated March 18, 2002, between the Company and Peter P. McCann (14) 10.20 Consulting Agreement dated August 31, 2001, between the Company and Michael K. Allio (8) 10.21 Amendment to Consulting Agreement dated August 21, 2002, between the Company and Michael K. Allio (16) 10.22 Employment Agreement dated March 18, 2002, between the Company and Dr. Joseph D. Mosca (15) 10.23 Separation Agreement and Release dated January 31, 2003, between the Company and Peter P. McCann (16) 10.24 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Company and Robert Demers (8) 10.25 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Company and Michael K. Allio (8) 10.26 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Company and John M. Musacchio (8) 10.27 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Company and Patrice Pactol (8) 10.28 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Company and Pierre-Francois Serres (8) 10.29 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and Pierre-Francois Serres (16) 10.30 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and Patrice Pactol (16) 10.31 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and Robert Demers (16) 10.32 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and John M. Musacchio (16) 10.33 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and Michael K. Allio (16) 10.34 Director and Non-Employee Stock Option Agreement dated August 21, 2002, between the Company and Michael K. Allio (16) 10.35 Director and Non-Employee Stock Option Agreement dated June 20, 2002, between the Company and Peter P. McCann (16) 10.36 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and Peter P. McCann (16) 10.37 Director and Non-Employee Stock Option Agreement dated February 6, 2003, between the Company and Peter P. McCann (16) 10.38 Patent Pledge Agreement dated November __, 2002 among Mymetics S.A., Mymetics Deutschland GmbH, the Company and MFC Merchant Bank S.A. (16) 10.39 Third Amendment to the Credit Facility Agreement dated for Reference December 31, 2006, between MFC Merchant Bank, S.A. and the Company (17) 10.40 Fourth Amendment to the Credit Facility Agreement dated for Reference February 16, 2005, between MFC Merchant Bank, S.A. and the Company (17) 10.41 Consulting Agreement dated for reference January 1, 2004, between the Centre Hospitalier Universitaire Vaudois (CHUV), the Company and Dr. Sylvain Fleury, Ph.D. (18) 10.42 Consulting Agreement dated for reference January 1, 2004, between the Company and Professor Marc Girard, DVM, D.Sc. |
(3) List of Exhibits 2.1 Share Exchange Agreement dated December 13, 2001 between the Corporation and the stockholders of Mymetics S.A. listed on the signature page thereto (1) 2.2 Share Exchange Agreement dated December 13, 2001 between the Company and the stockholders of Mymetics S.A. listed on the signature page thereto (1) 2.3 Purchase Agreement dated October 17, 1998 between the Company and the majority stockholders of Nazca Holdings Ltd. (2) 2.4 Amendment to the Purchase Agreement dated October 17, 1998 between the Company and the majority stockholders of Nazca Holdings Ltd. (3) 2.5 Revised Purchase Agreement dated July 28, 1999 between the Company and the majority stockholders of Nazca Holdings Ltd. (4) 2.6 Share Exchange Agreement dated July 30, 2002 between the Company and the stockholders of Mymetics S.A. listed on the signature page thereto (5) 3(i) Articles of Incorporation of the Company (as amended through May 10, 2002) (6) 3(ii) Bylaws (7) 4.1 Form of Specimen Stock Certificate (8) 4.2 Form of letter regarding Warrant (8) 4.3 Form of Share Exchange Agreement (8) 9.1 Voting and Exchange Trust Agreement dated March 19, 2001, among the Company, 6543 Luxembourg S.A. and MFC Merchant Bank S.A. (8) 10.1 Services Agreement dated May 31, 2001, between the Company and MFC Merchant Bank, S.A.(7) 10.2 Employment Agreement dated May 3, 2001, between Pierre-Francois Serres and the Company (7) 10.3 Indemnification Agreement dated March 19, 2001, between the Company and MFC Bancorp Ltd. (7) 10.4 Agreement dated for reference May 15, 2000, between the Company and Maarten Reidel (7) 10.5 Preferred Stock Redemption and Conversion Agreement dated for reference December 21, 2000, between the Company and Sutton Park International Ltd. (10) 10.6 Preferred Stock Conversion Agreement dated for reference December 21, 2000, between the Company and Med Net International Ltd. (11) 10.7 Preferred Stock Conversion Agreement dated December 21, 2000, between the Company and Dresden Papier GmbH (11) 10.8 Assignment Agreement dated December 29, 2000, among the Company, Mymetics S.A. and MFC Merchant Bank S.A. (1) 10.9 Credit Facility Agreement dated July 27, 2000, between MFC Merchant Bank, S.A. and the Company (1) 10.10 Amended Credit Facility Agreement dated for reference August 13, 2001, between MFC Merchant Bank, S.A. and the Company (16) 10.11 Second Amended Credit Facility Agreement dated for reference February 27, 2002, between MFC Merchant Bank, S.A. and the Company (16) 10.12 Amended and Restated Credit Facility Agreement dated for reference February 28, 2003, among MFC Merchant Bank, S.A., MFC Bancorp Ltd., and the Company (16) 10.13 Guarantee dated for reference February 28, 2003, by MFC Bancorp Ltd. to MFC Merchant Bank S.A. (16) 10.14 Shareholder Agreement dated March 19, 2001, among the Company, the Holders of Class B Exchangeable Preferential Non-Voting Shares of 6543 Luxembourg S.A. signatory thereto and 6543 Luxembourg S.A.(8) 10.15 Support Agreement dated March 19, 2001, between the Company and 6543 Luxembourg S.A. (8) 10.16 1995 Qualified Incentive Stock Option Plan (12) 10.17 Amended 1994 Stock Option Plan (13) 10.18 2001 ICHOR Company Stock Option Plan (7) 10.19 Employment Agreement dated March 18, 2002, between the Company and Peter P. McCann (14) 10.20 Consulting Agreement dated August 31, 2001, between the Company and Michael K. Allio (8) 10.21 Amendment to Consulting Agreement dated August 21, 2002, between the Company and Michael K. Allio (16) 10.22 Employment Agreement dated March 18, 2002, between the Company and Dr. Joseph D. Mosca (15) 10.23 Separation Agreement and Release dated January 31, 2003, between the Company and Peter P. McCann (16) 10.24 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Company and Robert Demers (8) 10.25 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Company and Michael K. Allio (8) 10.26 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Company and John M. Musacchio (8) 10.27 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Company and Patrice Pactol (8) 10.28 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Company and Pierre-Francois Serres (8) 10.29 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and Pierre-Francois Serres (16) 10.30 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and Patrice Pactol (16) 10.31 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and Robert Demers (16) 10.32 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and John M. Musacchio (16) 10.33 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and Michael K. Allio (16) 10.34 Director and Non-Employee Stock Option Agreement dated August21, 2002, between the Company and Michael K. Allio (16) 10.35 Director and Non-Employee Stock Option Agreement dated June 20, 2002, between the Company and Peter P. McCann (16) 10.36 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and Peter P. McCann (16) 10.37 Director and Non-Employee Stock Option Agreement dated February 6, 2003, between the Company and Peter P. McCann (16) 10.38 Patent Pledge Agreement dated November __, 2002 among Mymetics S.A., Mymetics Deutschland GmbH, the Company and MFC Merchant Bank S.A. (16) 10.39 Third Amendment to the Credit Facility Agreement dated for Reference December 31, 2006, between MFC Merchant Bank, S.A. and the Company (17) 10.40 Fourth Amendment to the Credit Facility Agreement dated for Reference February 16, 2005, between MFC Merchant Bank, S.A. and the Company (17) 10.41 Consulting Agreement dated for reference January 1, 2004, between the Centre Hospitalier Universitaire Vaudois (CHUV), the Company and Dr. Sylvain Fleury, Ph.D. (18) 10.42 Consulting Agreement dated for reference January 1, 2004, between the Company and Professor Marc Girard, DVM, D.Sc. |
(3) List of Exhibits 2.1 Share Exchange Agreement dated December 13, 2001 between the Corporation and the stockholders of Mymetics S.A. listed on the signature page thereto (1) 2.2 Share Exchange Agreement dated December 13, 2001 between the Company and the stockholders of Mymetics S.A. listed on the signature page thereto (1) 2.3 Purchase Agreement dated October 17, 1998 between the Company and the majority stockholders of Nazca Holdings Ltd. (2) 2.4 Amendment to the Purchase Agreement dated October 17, 1998 between the Company and the majority stockholders of Nazca Holdings Ltd. (3) 2.5 Revised Purchase Agreement dated July 28, 1999 between the Company and the majority stockholders of Nazca Holdings Ltd. (4) 2.6 Share Exchange Agreement dated July 30, 2002 between the Company and the stockholders of Mymetics S.A. listed on the signature page thereto (5) 3(i) Articles of Incorporation of the Company (as amended through May 10, 2002) (6) 3(ii) Bylaws (7) 4.1 Form of Specimen Stock Certificate (8) 4.2 Form of letter regarding Warrant (8) 4.3 Form of Share Exchange Agreement (8) 9.1 Voting and Exchange Trust Agreement dated March 19, 2001, among the Company, 6543 Luxembourg S.A. and MFC Merchant Bank S.A. (8) 10.1 Services Agreement dated May 31, 2001, between the Company and MFC Merchant Bank, S.A.(7) 10.2 Employment Agreement dated May 3, 2001, between Pierre-Francois Serres and the Company (7) 10.3 Indemnification Agreement dated March 19, 2001, between the Company and MFC Bancorp Ltd. (7) 10.4 Agreement dated for reference May 15, 2000, between the Company and Maarten Reidel (7) 10.5 Preferred Stock Redemption and Conversion Agreement dated for reference December 21, 2000, between the Company and Sutton Park International Ltd. (10) 10.6 Preferred Stock Conversion Agreement dated for reference December 21, 2000, between the Company and Med Net International Ltd. (11) 10.7 Preferred Stock Conversion Agreement dated December 21, 2000, between the Company and Dresden Papier GmbH (11) 10.8 Assignment Agreement dated December 29, 2000, among the Company, Mymetics S.A. and MFC Merchant Bank S.A. (1) 10.9 Credit Facility Agreement dated July 27, 2000, between MFC Merchant Bank, S.A. and the Company (1) 10.10 Amended Credit Facility Agreement dated for reference August 13, 2001, between MFC Merchant Bank, S.A. and the Company (16) 10.11 Second Amended Credit Facility Agreement dated for reference February 27, 2002, between MFC Merchant Bank, S.A. and the Company (16) 10.12 Amended and Restated Credit Facility Agreement dated for reference February 28, 2003, among MFC Merchant Bank, S.A., MFC Bancorp Ltd., and the Company (16) 10.13 Guarantee dated for reference February 28, 2003, by MFC Bancorp Ltd. to MFC Merchant Bank S.A. (16) 10.14 Shareholder Agreement dated March 19, 2001, among the Company, the Holders of Class B Exchangeable Preferential Non-Voting Shares of 6543 Luxembourg S.A. signatory thereto and 6543 Luxembourg S.A.(8) 10.15 Support Agreement dated March 19, 2001, between the Company and 6543 Luxembourg S.A. (8) 10.16 1995 Qualified Incentive Stock Option Plan (12) 10.17 Amended 1994 Stock Option Plan (13) 10.18 2001 ICHOR Company Stock Option Plan (7) 10.19 Employment Agreement dated March 18, 2002, between the Company and Peter P. McCann (14) 10.20 Consulting Agreement dated August 31, 2001, between the Company and Michael K. Allio (8) 10.21 Amendment to Consulting Agreement dated August 21, 2002, between the Company and Michael K. Allio (16) 10.22 Employment Agreement dated March 18, 2002, between the Company and Dr. Joseph D. Mosca (15) 10.23 Separation Agreement and Release dated January 31, 2003, between the Company and Peter P. McCann (16) 10.24 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Company and Robert Demers (8) 10.25 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Company and Michael K. Allio (8) 10.26 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Company and John M. Musacchio (8) 10.27 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Company and Patrice Pactol (8) 10.28 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Company and Pierre-Francois Serres (8) 10.29 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and Pierre-Francois Serres (16) 10.30 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and Patrice Pactol (16) 10.31 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and Robert Demers (16) 10.32 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and John M. Musacchio (16) 10.33 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and Michael K. Allio (16) 10.34 Director and Non-Employee Stock Option Agreement dated August 21, 2002, between the Company and Michael K. Allio (16) 10.35 Director and Non-Employee Stock Option Agreement dated June 20, 2002, between the Company and Peter P. McCann (16) 10.36 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and Peter P. McCann (16) 10.37 Director and Non-Employee Stock Option Agreement dated February 6, 2003, between the Company and Peter P. McCann (16) 10.38 Patent Pledge Agreement dated November __, 2002 among Mymetics S.A., Mymetics Deutschland GmbH, the Company and MFC Merchant Bank S.A. (16) 10.39 Third Amendment to the Credit Facility Agreement dated for Reference December 31, 2006, between MFC Merchant Bank, S.A. and the Company (17) 10.40 Fourth Amendment to the Credit Facility Agreement dated for Reference February 16, 2005, between MFC Merchant Bank, S.A. and the Company (17) 10.41 Consulting Agreement dated for reference January 1, 2004, between the Centre Hospitalier Universitaire Vaudois (CHUV), the Company and Dr. Sylvain Fleury, Ph.D. (18) 10.42 Consulting Agreement dated for reference January 1, 2004, between the Company and Professor Marc Girard, DVM, D.Sc. |
(3) List of Exhibits 2.1 Share Exchange Agreement dated December 13, 2001 between the Corporation and the stockholders of Mymetics S.A. listed on the signature page thereto (1) 2.2 Share Exchange Agreement dated December 13, 2001 between the Company and the stockholders of Mymetics S.A. listed on the signature page thereto (1) 2.3 Purchase Agreement dated October 17, 1998 between the Company and the majority stockholders of Nazca Holdings Ltd. (2) 2.4 Amendment to the Purchase Agreement dated October 17, 1998 between the Company and the majority stockholders of Nazca Holdings Ltd. (3) 2.5 Revised Purchase Agreement dated July 28, 1999 between the Company and the majority stockholders of Nazca Holdings Ltd. (4) 2.6 Share Exchange Agreement dated July 30, 2002 between the Company and the stockholders of Mymetics S.A. listed on the signature page thereto (5) 3(i) Articles of Incorporation of the Company (as amended through May 10, 2002) (6) 3(ii) Bylaws (7) 4.1 Form of Specimen Stock Certificate (8) 4.2 Form of letter regarding Warrant (8) 4.3 Form of Share Exchange Agreement (8) 9.1 Voting and Exchange Trust Agreement dated March 19, 2001, among the Company, 6543 Luxembourg S.A. and MFC Merchant Bank S.A. (8) 10.1 Services Agreement dated May 31, 2001, between the Company and MFC Merchant Bank, S.A.(7) 10.2 Employment Agreement dated May 3, 2001, between Pierre-Francois Serres and the Company (7) 10.3 Indemnification Agreement dated March 19, 2001, between the Company and MFC Bancorp Ltd. (7) 10.4 Agreement dated for reference May 15, 2000, between the Company and Maarten Reidel (7) 10.5 Preferred Stock Redemption and Conversion Agreement dated for reference December 21, 2000, between the Company and Sutton Park International Ltd. (10) 10.6 Preferred Stock Conversion Agreement dated for reference December 21, 2000, between the Company and Med Net International Ltd. (11) 10.7 Preferred Stock Conversion Agreement dated December 21, 2000, between the Company and Dresden Papier GmbH (11) 10.8 Assignment Agreement dated December 29, 2000, among the Company, Mymetics S.A. and MFC Merchant Bank S.A. (1) 10.9 Credit Facility Agreement dated July 27, 2000, between MFC Merchant Bank, S.A. and the Company (1) 10.10 Amended Credit Facility Agreement dated for reference August 13, 2001, between MFC Merchant Bank, S.A. and the Company (16) 10.11 Second Amended Credit Facility Agreement dated for reference February 27, 2002, between MFC Merchant Bank, S.A. and the Company (16) 10.12 Amended and Restated Credit Facility Agreement dated for reference February 28, 2003, among MFC Merchant Bank, S.A., MFC Bancorp Ltd., and the Company (16) 10.13 Guarantee dated for reference February 28, 2003, by MFC Bancorp Ltd. to MFC Merchant Bank S.A. (16) 10.14 Shareholder Agreement dated March 19, 2001, among the Company, the Holders of Class B Exchangeable Preferential Non-Voting Shares of 6543 Luxembourg S.A. signatory thereto and 6543 Luxembourg S.A.(8) 10.15 Support Agreement dated March 19, 2001, between the Company and 6543 Luxembourg S.A. (8) 10.16 1995 Qualified Incentive Stock Option Plan (12) 10.17 Amended 1994 Stock Option Plan (13) 10.18 2001 ICHOR Company Stock Option Plan (7) 10.19 Employment Agreement dated March 18, 2002, between the Company and Peter P. McCann (14) 10.20 Consulting Agreement dated August 31, 2001, between the Company and Michael K. Allio (8) 10.21 Amendment to Consulting Agreement dated August 21, 2002, between the Company and Michael K. Allio (16) 10.22 Employment Agreement dated March 18, 2002, between the Company and Dr. Joseph D. Mosca (15) 10.23 Separation Agreement and Release dated January 31, 2003, between the Company and Peter P. McCann (16) 10.24 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Company and Robert Demers (8) 10.25 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Company and Michael K. Allio (8) 10.26 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Company and John M. Musacchio (8) 10.27 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Company and Patrice Pactol (8) 10.28 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Company and Pierre-Francois Serres (8) 10.29 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and Pierre-Francois Serres (16) 10.30 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and Patrice Pactol (16) 10.31 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and Robert Demers (16) 10.32 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and John M. Musacchio (16) 10.33 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and Michael K. Allio (16) 10.34 Director and Non-Employee Stock Option Agreement dated August 21, 2002, between the Company and Michael K. Allio (16) 10.35 Director and Non-Employee Stock Option Agreement dated June 20, 2002, between the Company and Peter P. McCann (16) 10.36 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and Peter P. McCann (16) 10.37 Director and Non-Employee Stock Option Agreement dated February 6, 2003, between the Company and Peter P. McCann (16) 10.38 Patent Pledge Agreement dated November __, 2002 among Mymetics S.A., Mymetics Deutschland GmbH, the Company and MFC Merchant Bank S.A. (16) 10.39 Third Amendment to the Credit Facility Agreement dated for Reference December 31, 2006, between MFC Merchant Bank, S.A. and the Company (17) 10.40 Fourth Amendment to the Credit Facility Agreement dated for Reference February 16, 2005, between MFC Merchant Bank, S.A. and the Company (17) 10.41 Consulting Agreement dated for reference January 1, 2004, between the Centre Hospitalier Universitaire Vaudois (CHUV), the Company and Dr. Sylvain Fleury, Ph.D. (18) 10.42 Consulting Agreement dated for reference January 1, 2004, between the Company and Professor Marc Girard, DVM, D.Sc. |
(3) List of Exhibits 2.1 Share Exchange Agreement dated December 13, 2001 between the Corporation and the stockholders of Mymetics S.A. listed on the signature page thereto (1) 2.2 Share Exchange Agreement dated December 13, 2001 between the Company and the stockholders of Mymetics S.A. listed on the signature page thereto (1) 2.3 Purchase Agreement dated October 17, 1998 between the Company and the majority stockholders of Nazca Holdings Ltd. (2) 2.4 Amendment to the Purchase Agreement dated October 17, 1998 between the Company and the majority stockholders of Nazca Holdings Ltd. (3) 2.5 Revised Purchase Agreement dated July 28, 1999 between the Company and the majority stockholders of Nazca Holdings Ltd. (4) 2.6 Share Exchange Agreement dated July 30, 2002 between the Company and the stockholders of Mymetics S.A. listed on the signature page thereto (5) 3(i) Articles of Incorporation of the Company (as amended through May 10, 2002) (6) 3(ii) Bylaws (7) 4.1 Form of Specimen Stock Certificate (8) 4.2 Form of letter regarding Warrant (8) 4.3 Form of Share Exchange Agreement (8) 9.1 Voting and Exchange Trust Agreement dated March 19, 2001, among the Company, 6543 Luxembourg S.A. and MFC Merchant Bank S.A. (8) 10.1 Services Agreement dated May 31, 2001, between the Company and MFC Merchant Bank, S.A.(7) 10.2 Employment Agreement dated May 3, 2001, between Pierre-Francois Serres and the Company (7) 10.3 Indemnification Agreement dated March 19, 2001, between the Company and MFC Bancorp Ltd. (7) 10.4 Agreement dated for reference May 15, 2000, between the Company and Maarten Reidel (7) 10.5 Preferred Stock Redemption and Conversion Agreement dated for reference December 21, 2000, between the Company and Sutton Park International Ltd. (10) 10.6 Preferred Stock Conversion Agreement dated for reference December 21, 2000, between the Company and Med Net International Ltd. (11) 10.7 Preferred Stock Conversion Agreement dated December 21, 2000, between the Company and Dresden Papier GmbH (11) 10.8 Assignment Agreement dated December 29, 2000, among the Company, Mymetics S.A. and MFC Merchant Bank S.A. (1) 10.9 Credit Facility Agreement dated July 27, 2000, between MFC Merchant Bank, S.A. and the Company (1) 10.10 Amended Credit Facility Agreement dated for reference August 13, 2001, between MFC Merchant Bank, S.A. and the Company (16) 10.11 Second Amended Credit Facility Agreement dated for reference February 27, 2002, between MFC Merchant Bank, S.A. and the Company (16) 10.12 Amended and Restated Credit Facility Agreement dated for reference February 28, 2003, among MFC Merchant Bank, S.A., MFC Bancorp Ltd., and the Company (16) 10.13 Guarantee dated for reference February 28, 2003, by MFC Bancorp Ltd. to MFC Merchant Bank S.A. (16) 10.14 Shareholder Agreement dated March 19, 2001, among the Company, the Holders of Class B Exchangeable Preferential Non-Voting Shares of 6543 Luxembourg S.A. signatory thereto and 6543 Luxembourg S.A.(8) 10.15 Support Agreement dated March 19, 2001, between the Company and 6543 Luxembourg S.A. (8) 10.16 1995 Qualified Incentive Stock Option Plan (12) 10.17 Amended 1994 Stock Option Plan (13) 10.18 2001 ICHOR Company Stock Option Plan (7) 10.19 Employment Agreement dated March 18, 2002, between the Company and Peter P. McCann (14) 10.20 Consulting Agreement dated August 31, 2001, between the Company and Michael K. Allio (8) 10.21 Amendment to Consulting Agreement dated August 21, 2002, between the Company and Michael K. Allio (16) 10.22 Employment Agreement dated March 18, 2002, between the Company and Dr. Joseph D. Mosca (15) 10.23 Separation Agreement and Release dated January 31, 2003, between the Company and Peter P. McCann (16) 10.24 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Company and Robert Demers (8) 10.25 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Company and Michael K. Allio (8) 10.26 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Company and John M. Musacchio (8) 10.27 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Company and Patrice Pactol (8) 10.28 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Company and Pierre-Francois Serres (8) 10.29 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and Pierre-Francois Serres (16) 10.30 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and Patrice Pactol (16) 10.31 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and Robert Demers (16) 10.32 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and John M. Musacchio (16) 10.33 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and Michael K. Allio (16) 10.34 Director and Non-Employee Stock Option Agreement dated August 21, 2002, between the Company and Michael K. Allio (16) 10.35 Director and Non-Employee Stock Option Agreement dated June 20, 2002, between the Company and Peter P. McCann (16) 10.36 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Company and Peter P. McCann (16) 10.37 Director and Non-Employee Stock Option Agreement dated February 6, 2003, between the Company and Peter P. McCann (16) 10.38 Patent Pledge Agreement dated November __, 2002 among Mymetics S.A., Mymetics Deutschland GmbH, the Company and MFC Merchant Bank S.A. (16) 10.39 Third Amendment to the Credit Facility Agreement dated for Reference December 31, 2006, between MFC Merchant Bank, S.A. and the Company (17) 10.40 Fourth Amendment to the Credit Facility Agreement dated for Reference February 16, 2005, between MFC Merchant Bank, S.A. and the Company (17) 10.41 Consulting Agreement dated for reference January 1, 2004, between the Centre Hospitalier Universitaire Vaudois (CHUV), the Company and Dr. Sylvain Fleury, Ph.D. (18) 10.42 Consulting Agreement dated for reference January 1, 2004, between the Company and Professor Marc Girard, DVM, D.Sc. |
(3) List of Exhibits 2.1 Share Exchange Agreement dated December 13, 2001 between the Corporation and the stockholders of Mymetics S.A. listed on the signature page thereto (1) 2.2 Share Exchange Agreement dated December 13, 2001 between the Corporation and the stockholders of Mymetics S.A. listed on the signature page thereto (1) 2.3 Purchase Agreement dated October 17, 1998 between the Corporation and the majority stockholders of Nazca Holdings Ltd. (2) 2.4 Amendment to the Purchase Agreement dated October 17, 1998 between the Corporation and the majority stockholders of Nazca Holdings Ltd. (3) 2.5 Revised Purchase Agreement dated July 28, 1999 between the Corporation and the majority stockholders of Nazca Holdings Ltd. (4) 2.6 Share Exchange Agreement dated July 30, 2002 between the Corporation and the stockholders of Mymetics S.A. listed on the signature page thereto (5) 3(i) Articles of Incorporation of the Corporation (as amended through May 10, 2002) (6) 3(ii) Bylaws (7) 4.1 Form of Specimen Stock Certificate (8) 4.2 Form of letter regarding Warrant 4.3 Form of Share Exchange Agreement 9.1 Voting and Exchange Trust Agreement dated March 28, 2001, Among the Corporation, 6543 Luxembourg S.A. and MFC Merchant Bank S.A. (8) 10.1 Services Agreement dated May 31, 2001, between the Corporation and MFC Merchant Bank, S.A.(7) 10.2 Employment Agreement dated May 3, 2001, between Pierre-Francois Serres and the Corporation (7) 10.3 Indemnification Agreement dated March 28, 2001, between the Corporation and MFC Bancorp Ltd. (7) 10.4 Agreement dated for reference May 15, 2000, between the Corporation and Maarten Reidel (7) 10.5 Preferred Stock Redemption and Conversion Agreement dated for reference December 21, 2000, between the Corporation and Sutton Park International Ltd. (10) 10.6 Preferred Stock Conversion Agreement dated for reference December 21, 2000, between the Corporation and Med Net International Ltd. (11) 10.7 Preferred Stock Conversion Agreement dated December 21, 2000, between the Corporation and Dresden Papier GmbH (11) 10.8 Assignment Agreement dated December 29, 2000, among the Corporation, Mymetics S.A. and MFC Merchant Bank S.A. (1) 10.9 Credit Facility Agreement dated July 27, 2000, between MFC Merchant Bank, S.A. and the Corporation (1) 10.10 Amended Credit Facility Agreement dated for reference August 13, 2001, between MFC Merchant Bank, S.A. and the Corporation (16) 10.11 Second Amended Credit Facility Agreement dated for reference February 27, 2002, between MFC Merchant Bank, S.A. and the Corporation (16) 10.12 Amended and Restated Credit Facility Agreement dated for reference February 28, 2003, among MFC Merchant Bank, S.A., MFC Bancorp Ltd., and the Corporation (16) 10.13 Guarantee dated for reference February 28, 2003, by MFC Bancorp Ltd. to MFC Merchant Bank S.A. (16) 10.14 Shareholder Agreement dated March 28, 2001, among the Corporation, the Holders of Class B Exchangeable Preferential Non-Voting Shares of 6543 Luxembourg S.A. signatory thereto and 6543 Luxembourg S.A.(8) 10.15 Support Agreement dated March 28, 2001, between the Corporation and 6543 Luxembourg S.A. (8) 10.16 1995 Qualified Incentive Stock Option Plan (12) 10.17 Amended 1994 Stock Option Plan (13) 10.18 2001 ICHOR Corporation Stock Option Plan (7) 10.19 Employment Agreement dated March 18, 2002, between the Corporation and Peter P. McCann (14) 10.20 Consulting Agreement dated August 31, 2001, between the Corporation and Michael K. Allio (8) 10.21 Amendment to Consulting Agreement dated August 21, 2002, between the Corporation and Michael K. Allio (16) 10.22 Employment Agreement dated March 18, 2002, between the Corporation and Dr. Joseph D. Mosca (15) 10.23 Separation Agreement and Release dated January 31, 2003, between the Corporation and Peter P. McCann (16) 10.24 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and Robert Demers (8) 10.25 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and Michael K. Allio (8) 10.26 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and John M. Musacchio (8) 10.27 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and Patrice Pactol (8) 10.28 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and Pierre-Francois Serres (8) 10.29 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Pierre-Francois Serres (16) 10.30 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Patrice Pactol (16) 10.31 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Robert Demers (16) 10.32 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and John M. Musacchio (16) 10.33 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Michael K. Allio (16) 10.34 Director and Non-Employee Stock Option Agreement dated August 21, 2002, between the Corporation and Michael K. Allio (16) 10.35 Director and Non-Employee Stock Option Agreement dated June 20, 2002, between the Corporation and Peter P. McCann (16) 10.36 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Peter P. McCann (16) 10.37 Director and Non-Employee Stock Option Agreement dated February 6, 2003, between the Corporation and Peter P. McCann (16) 10.38 Patent Pledge Agreement dated November __, 2002 among Mymetics S.A., Mymetics Deutschland GmbH, the Corporation and MFC Merchant Bank S.A. (16) 11.1 Statement Regarding Calculation of Per Share Earnings. |
(3) List of Exhibits 2.1 Share Exchange Agreement dated December 13, 2001 between the Corporation and the stockholders of Mymetics S.A. listed on the signature page thereto (1) 2.2 Share Exchange Agreement dated December 13, 2001 between the Corporation and the stockholders of Mymetics S.A. listed on the signature page thereto (1) 2.3 Purchase Agreement dated October 17, 1998 between the Corporation and the majority stockholders of Nazca Holdings Ltd. (2) 2.4 Amendment to the Purchase Agreement dated October 17, 1998 between the Corporation and the majority stockholders of Nazca Holdings Ltd. (3) 2.5 Revised Purchase Agreement dated July 28, 1999 between the Corporation and the majority stockholders of Nazca Holdings Ltd. (4) 2.6 Share Exchange Agreement dated July 30, 2002 between the Corporation and the stockholders of Mymetics S.A. listed on the signature page thereto (5) 3(i) Articles of Incorporation of the Corporation (as amended through May 10, 2002) (6) 3(ii) Bylaws (7) 4.1 Form of Specimen Stock Certificate (8) 4.2 Form of letter regarding Warrant 4.3 Form of Share Exchange Agreement 9.1 Voting and Exchange Trust Agreement dated March 28, 2001, Among the Corporation, 6543 Luxembourg S.A. and MFC Merchant Bank S.A. (8) 10.1 Services Agreement dated May 31, 2001, between the Corporation and MFC Merchant Bank, S.A.(7) 10.2 Employment Agreement dated May 3, 2001, between Pierre-Francois Serres and the Corporation (7) 10.3 Indemnification Agreement dated March 28, 2001, between the Corporation and MFC Bancorp Ltd. (7) 10.4 Agreement dated for reference May 15, 2000, between the Corporation and Maarten Reidel (7) 10.5 Preferred Stock Redemption and Conversion Agreement dated for reference December 21, 2000, between the Corporation and Sutton Park International Ltd. (10) 10.6 Preferred Stock Conversion Agreement dated for reference December 21, 2000, between the Corporation and Med Net International Ltd. (11) 10.7 Preferred Stock Conversion Agreement dated December 21, 2000, between the Corporation and Dresden Papier GmbH (11) 10.8 Assignment Agreement dated December 29, 2000, among the Corporation, Mymetics S.A. and MFC Merchant Bank S.A. (1) 10.9 Credit Facility Agreement dated July 27, 2000, between MFC Merchant Bank, S.A. and the Corporation (1) 10.10 Amended Credit Facility Agreement dated for reference August 13, 2001, between MFC Merchant Bank, S.A. and the Corporation (16) 10.11 Second Amended Credit Facility Agreement dated for reference February 27, 2002, between MFC Merchant Bank, S.A. and the Corporation (16) 10.12 Amended and Restated Credit Facility Agreement dated for reference February 28, 2003, among MFC Merchant Bank, S.A., MFC Bancorp Ltd., and the Corporation (16) 10.13 Guarantee dated for reference February 28, 2003, by MFC Bancorp Ltd. to MFC Merchant Bank S.A. (16) 10.14 Shareholder Agreement dated March 28, 2001, among the Corporation, the Holders of Class B Exchangeable Preferential Non-Voting Shares of 6543 Luxembourg S.A. signatory thereto and 6543 Luxembourg S.A.(8) 10.15 Support Agreement dated March 28, 2001, between the Corporation and 6543 Luxembourg S.A. (8) 10.16 1995 Qualified Incentive Stock Option Plan (12) 10.17 Amended 1994 Stock Option Plan (13) 10.18 2001 ICHOR Corporation Stock Option Plan (7) 10.19 Employment Agreement dated March 18, 2002, between the Corporation and Peter P. McCann (14) 10.20 Consulting Agreement dated August 31, 2001, between the Corporation and Michael K. Allio (8) 10.21 Amendment to Consulting Agreement dated August 21, 2002, between the Corporation and Michael K. Allio (16) 10.22 Employment Agreement dated March 18, 2002, between the Corporation and Dr. Joseph D. Mosca (15) 10.23 Separation Agreement and Release dated January 31, 2003, between the Corporation and Peter P. McCann (16) 10.24 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and Robert Demers (8) 10.25 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and Michael K. Allio (8) 10.26 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and John M. Musacchio (8) 10.27 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and Patrice Pactol (8) 10.28 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and Pierre-Francois Serres (8) 10.29 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Pierre-Francois Serres (16) 10.30 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Patrice Pactol (16) 10.31 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Robert Demers (16) 10.32 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and John M. Musacchio (16) 10.33 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Michael K. Allio (16) 10.34 Director and Non-Employee Stock Option Agreement dated August 21, 2002, between the Corporation and Michael K. Allio (16) 10.35 Director and Non-Employee Stock Option Agreement dated June 20, 2002, between the Corporation and Peter P. McCann (16) 10.36 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Peter P. McCann (16) 10.37 Director and Non-Employee Stock Option Agreement dated February 6, 2003, between the Corporation and Peter P. McCann (16) 10.38 Patent Pledge Agreement dated November __, 2002 among Mymetics S.A., Mymetics Deutschland GmbH, the Corporation and MFC Merchant Bank S.A. (16) 11.1 Statement Regarding Calculation of Per Share Earnings. |
EXHIBIT INDEX 2001, between the Corporation and John M. Musacchio (8) 10.27 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and Patrice Pactol (8) 10.28 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and Pierre-Francois Serres (8) 10.29 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Pierre-Francois Serres (16) 10.30 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Patrice Pactol (16) 10.31 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Robert Demers (16) 10.32 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and John M. Musacchio (16) 10.33 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Michael K. Allio (16) 10.34 Director and Non-Employee Stock Option Agreement dated August 21, 2002, between the Corporation and Michael K. Allio (16) 10.35 Director and Non-Employee Stock Option Agreement dated June 20, 2002, between the Corporation and Peter P. McCann (16) 10.36 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Peter P. McCann (16) 10.37 Director and Non-Employee Stock Option Agreement dated February 6, 2003, between the Corporation and Peter P. McCann (16) 10.38 Patent Pledge Agreement dated November __, 2002 among Mymetics S.A., Mymetics Deutschland GmbH, the Corporation and MFC Merchant Bank S.A. (16) 10.39 Third Amendment to the Credit Facility Agreement dated for reference December 31, 2004, between MFC Merchant Bank, S.A. and the Corporation (17) 10.40 Fourth Amendment to the Credit Facility Agreement dated for reference February 16, 2005, between MFC Merchant Bank, S.A. and the Corporation (17) 10.41 Consulting Agreement dated for reference January 1, 2004, between the Centre Hospitalier Universitaire Vaudois (CHUV), the Corporation and Dr. Sylvain Fleury, Ph.D. 10.42 Consulting Agreement dated for reference January 1, 2004, between the Corporation and Professor Marc Girard, DVM, D.Sc. |
(3) List of Exhibits 2.1 Share Exchange Agreement dated December 13, 2001 between the Corporation and the stockholders of Mymetics S.A. listed on the signature page thereto (1) 2.2 Share Exchange Agreement dated December 13, 2001 between the Corporation and the stockholders of Mymetics S.A. listed on the signature page thereto (1) 2.3 Purchase Agreement dated October 17, 1998 between the Corporation and the majority stockholders of Nazca Holdings Ltd. (2) 2.4 Amendment to the Purchase Agreement dated October 17, 1998 between the Corporation and the majority stockholders of Nazca Holdings Ltd. (3) 2.5 Revised Purchase Agreement dated July 28, 1999 between the Corporation and the majority stockholders of Nazca Holdings Ltd. (4) 2.6 Share Exchange Agreement dated July 30, 2002 between the Corporation and the stockholders of Mymetics S.A. listed on the signature page thereto (5) 3(i) Articles of Incorporation of the Corporation (as amended through May 10, 2002) (6) 3(ii) Bylaws (7) 4.1 Form of Specimen Stock Certificate (8) 4.2 Form of letter regarding Warrant 4.3 Form of Share Exchange Agreement 9.1 Voting and Exchange Trust Agreement dated March 28, 2001, Among the Corporation, 6543 Luxembourg S.A. and MFC Merchant Bank S.A. (8) 10.1 Services Agreement dated May 31, 2001, between the Corporation and MFC Merchant Bank, S.A.(7) 10.2 Employment Agreement dated May 3, 2001, between Pierre-Francois Serres and the Corporation (7) 10.3 Indemnification Agreement dated March 28, 2001, between the Corporation and MFC Bancorp Ltd. (7) 10.4 Agreement dated for reference May 15, 2000, between the Corporation and Maarten Reidel (7) 10.5 Preferred Stock Redemption and Conversion Agreement dated for reference December 21, 2000, between the Corporation and Sutton Park International Ltd. (10) 10.6 Preferred Stock Conversion Agreement dated for reference December 21, 2000, between the Corporation and Med Net International Ltd. (11) 10.7 Preferred Stock Conversion Agreement dated December 21, 2000, between the Corporation and Dresden Papier GmbH (11) 10.8 Assignment Agreement dated December 29, 2000, among the Corporation, Mymetics S.A. and MFC Merchant Bank S.A. (1) 10.9 Credit Facility Agreement dated July 27, 2000, between MFC Merchant Bank, S.A. and the Corporation (1) 10.10 Amended Credit Facility Agreement dated for reference August 13, 2001, between MFC Merchant Bank, S.A. and the Corporation (16) 10.11 Second Amended Credit Facility Agreement dated for reference February 27, 2002, between MFC Merchant Bank, S.A. and the Corporation (16) 10.12 Amended and Restated Credit Facility Agreement dated for reference February 28, 2003, among MFC Merchant Bank, S.A., MFC Bancorp Ltd., and the Corporation (16) 10.13 Guarantee dated for reference February 28, 2003, by MFC Bancorp Ltd. to MFC Merchant Bank S.A. (16) 10.14 Shareholder Agreement dated March 28, 2001, among the Corporation, the Holders of Class B Exchangeable Preferential Non-Voting Shares of 6543 Luxembourg S.A. signatory thereto and 6543 Luxembourg S.A.(8) 10.15 Support Agreement dated March 28, 2001, between the Corporation and 6543 Luxembourg S.A. (8) 10.16 1995 Qualified Incentive Stock Option Plan (12) 10.17 Amended 1994 Stock Option Plan (13) 10.18 2001 ICHOR Corporation Stock Option Plan (7) 10.19 Employment Agreement dated March 18, 2002, between the Corporation and Peter P. McCann (14) 10.20 Consulting Agreement dated August 31, 2001, between the Corporation and Michael K. Allio (8) 10.21 Amendment to Consulting Agreement dated August 21, 2002, between the Corporation and Michael K. Allio (16) 10.22 Employment Agreement dated March 18, 2002, between the Corporation and Dr. Joseph D. Mosca (15) 10.23 Separation Agreement and Release dated January 31, 2003, between the Corporation and Peter P. McCann (16) 10.24 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and Robert Demers (8) 10.25 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and Michael K. Allio (8) 10.26 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and John M. Musacchio (8) 10.27 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and Patrice Pactol (8) 10.28 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and Pierre-Francois Serres (8) 10.29 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Pierre-Francois Serres (16) 10.30 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Patrice Pactol (16) 10.31 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Robert Demers (16) 10.32 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and John M. Musacchio (16) 10.33 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Michael K. Allio (16) 10.34 Director and Non-Employee Stock Option Agreement dated August 21, 2002, between the Corporation and Michael K. Allio (16) 10.35 Director and Non-Employee Stock Option Agreement dated June 20, 2002, between the Corporation and Peter P. McCann (16) 10.36 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Peter P. McCann (16) 10.37 Director and Non-Employee Stock Option Agreement dated February 6, 2003, between the Corporation and Peter P. McCann (16) 10.38 Patent Pledge Agreement dated November __, 2002 among Mymetics S.A., Mymetics Deutschland GmbH, the Corporation and MFC Merchant Bank S.A. (16) 11.1 Statement Regarding Calculation of Per Share Earnings. |
Rochet Officer) /s/ Ernst Luebke Chief Financial Officer and --------------------------- Director (Principal Financial and Ernst Luebke Accounting Officer) /s/ Pierre-Francois Serres Director --------------------------- Pierre-Francois Serres /s/ Robert Zimmer Director --------------------------- Robert Zimmer EXHIBIT INDEX EXHIBIT NUMBER DESCRIPTION ------ ----------- 2.1 Share Exchange Agreement dated December 13, 2001 between the Corporation and the stockholders of Mymetics S.A. listed on the signature page thereto (1) 2.2 Share Exchange Agreement dated December 13, 2001 between the Corporation and the stockholders of Mymetics S.A. listed on the signature page thereto (1) 2.3 Purchase Agreement dated October 17, 1998 between the Corporation and the majority stockholders of Nazca Holdings Ltd. (2) 2.4 Amendment to the Agreement dated October 17, 1998 between the Corporation and the majority stockholders of Nazca Holdings Ltd. (3) 2.5 Revised Purchase Agreement dated July 28, 1999 between the Corporation and the majority stockholders of Nazca Holdings Ltd. (4) 2.6 Share Exchange Agreement dated July 30, 2002 between the Corporation and the stockholders of Mymetics S.A. listed on the signature page thereto (5) 3(i) Articles of Incorporation of the Corporation (as amended through May 10, 2002) (6) 3(ii) Bylaws (7) 4.1 Form of Specimen Stock Certificate (8) 4.2 Form of letter regarding Warrant 4.3 Form of Share Exchange Agreement 9.1 Voting and Exchange Trust Agreement dated March 28, 2001, among the Corporation, 6543 Luxembourg S.A. and MFC Merchant Bank S.A. (8) 10.1 Services Agreement dated May 31, 2001, between the Corporation and MFC Merchant Bank, S.A.(7) 10.2 Employment Agreement dated May 3, 2001, between Pierre-Francois Serres and the Corporation (7) 10.3 Indemnification Agreement dated March 28, 2001, between the Corporation and MFC Bancorp Ltd. (7) 10.4 Agreement dated for reference May 15, 2000, between the Corporation and Maarten Reidel (7) 10.5 Preferred Stock Redemption and Conversion Agreement dated for reference December 21, 2000, between the Corporation and Sutton Park International Ltd. (10) 10.6 Preferred Stock Conversion Agreement dated for reference December 21, 2000, between the Corporation and Med Net International Ltd. (11) 10.7 Preferred Stock Conversion Agreement dated December 21, 2000, between the Corporation and Dresden Papier GmbH (11) 10.8 Assignment Agreement dated December 29, 2000, among the Corporation, Mymetics S.A. and MFC Merchant Bank S.A. (1) 10.9 Credit Facility Agreement dated July 27, 2000, between MFC Merchant Bank, S.A. and the Corporation (1) 10.10 Amended Credit Facility Agreement dated for reference August 13, 2001, between MFC Merchant Bank, S.A. and the Corporation (16) 10.11 Second Amended Credit Facility Agreement dated for reference February 27, 2002, between MFC Merchant Bank, S.A. and the Corporation (16) 10.12 Amended and Restated Credit Facility Agreement dated for reference February 28, 2003, among MFC Merchant Bank, S.A., MFC Bancorp Ltd., and the Corporation (16) 10.13 Guarantee dated for reference February 28, 2003, by MFC Bancorp Ltd. to MFC Merchant Bank S.A. (16) 10.14 Shareholder Agreement dated March 28, 2001, among the Corporation, the Holders of Class B Exchangeable Preferential Non-Voting Shares of 6543 Luxembourg S.A. signatory thereto and 6543 Luxembourg S.A.(8) 10.15 Support Agreement dated March 28, 2001, between the Corporation and 6543 Luxembourg S.A. (8) 10.16 1995 Qualified Incentive Stock Option Plan (12) 10.17 Amended 1994 Stock Option Plan (13) 10.18 2001 ICHOR Corporation Stock Option Plan (7) 10.19 Employment Agreement dated March 18, 2002, between the Corporation and Peter P. McCann (14) 10.20 Consulting Agreement dated August 31, 2001, between the Corporation and Michael K. Allio (8) 10.21 Amendment to Consulting Agreement dated August 21, 2002, between the Corporation and Michael K. Allio (16) 10.22 Employment Agreement dated March 18, 2002, between the Corporation and Dr. Joseph D. Mosca (15) 10.23 Separation Agreement and Release dated January 31, 2003, between the Corporation and Peter P. McCann (16) 10.24 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and Robert Demers (8) 10.25 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and Michael K. Allio (8) 10.26 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and John M. Musacchio (8) 10.27 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and Patrice Pactol (8) 10.28 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and Pierre-Francois Serres (8) 10.29 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Pierre-Francois Serres (16) 10.30 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Patrice Pactol (16) 10.31 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Robert Demers (16) 10.32 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and John M. Musacchio (16) 10.33 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Michael K. Allio (16) 10.34 Director and Non-Employee Stock Option Agreement dated August 21, 2002, between the Corporation and Michael K. Allio (16) 10.35 Director and Non-Employee Stock Option Agreement dated June 20, 2002, between the Corporation and Peter P. McCann (16) 10.36 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Peter P. McCann (16) 10.37 Director and Non-Employee Stock Option Agreement dated February 6, 2003, between the Corporation and Peter P. McCann (16) 10.38 Patent Pledge Agreement dated November __, 2002 among Mymetics S.A., Mymetics Deutschland GmbH, the Corporation and MFC Merchant Bank S.A. (16) 11.1 Statement Regarding Calculation of Per Share Earnings. |
(3) List of Exhibits 2.1 Share Exchange Agreement dated December 13, 2001 between the Corporation and the stockholders of Mymetics S.A. listed on the signature page thereto (1) 2.2 Share Exchange Agreement dated December 13, 2001 between the Corporation and the stockholders of Mymetics S.A. listed on the signature page thereto (1) 2.3 Purchase Agreement dated October 17, 1998 between the Corporation and the majority stockholders of Nazca Holdings Ltd. (2) 2.4 Amendment to the Purchase Agreement dated October 17, 1998 between the Corporation and the majority stockholders of Nazca Holdings Ltd. (3) 2.5 Revised Purchase Agreement dated July 28, 1999 between the Corporation and the majority stockholders of Nazca Holdings Ltd. (4) 2.6 Share Exchange Agreement dated July 30, 2002 between the Corporation and the stockholders of Mymetics S.A. listed on the signature page therto (5) 3(i) Articles of Incorporation of the Corporation (as amended through May 10, 2002) (6) 3(ii) Bylaws (7) 4 Form of Specimen Stock Certificate (8) 9 Voting and Exchange Trust Agreement dated March 28, 2001, among the Corporation, 6543 Luxembourg S.A. and MFC Merchant Bank S.A. (8) 10.1 Services Agreement dated May 31, 2001, between the Corporation and MFC Merchant Bank, S.A.(7) 10.2 Employment Agreement dated May 3, 2001, between Pierre-Francois Serres and the Corporation (7) 10.3 Indemnification Agreement dated March 28, 2001, between the Corporation and MFC Bancorp Ltd. (7) 10.4 Agreement dated for reference May 15, 2000, between the Corporation and Maarten Reidel (7) 10.5 Preferred Stock Redemption and Conversion Agreement dated for reference December 21, 2000, between the Corporation and Sutton Park International Ltd. (10) 10.6 Preferred Stock Conversion Agreement dated for reference December 21, 2000, between the Corporation and Med Net International Ltd. (11) 10.7 Preferred Stock Conversion Agreement dated December 21, 2000, between the Corporation and Dresden Papier GmbH (11) 10.8 Assignment Agreement dated December 29, 2000, among the Corporation, Mymetics S.A. and MFC Merchant Bank S.A. (1) 10.9 Credit Facility Agreement dated July 27, 2000, between MFC Merchant Bank, S.A. and the Corporation (1) 10.10 Amended Credit Facility Agreement dated for reference August 13, 2001, between MFC Merchant Bank, S.A. and the Corporation 10.11 Second Amended Credit Facility Agreement dated for reference February 27, 2002, between MFC Merchant Bank, S.A. and the Corporation 10.12 Amended and Restated Credit Facility Agreement dated for reference February 28, 2003, among MFC Merchant Bank, S.A., MFC Bancorp Ltd., and the Corporation 10.13 Guarantee dated for reference February 28, 2003, by MFC Bancorp Ltd. to MFC Merchant Bank S.A. 10.14 Shareholder Agreement dated March 28, 2001, among the Corporation, the Holders of Class B Exchangeable Preferential Non-Voting Shares of 6543 Luxembourg S.A. signatory thereto and 6543 Luxembourg S.A.(8) 10.15 Support Agreement dated March 28, 2001, between the Corporation and 6543 Luxembourg S.A. (8) 10.16 1995 Qualified Incentive Stock Option Plan (12) 10.17 Amended 1994 Stock Option Plan (13) 10.18 2001 ICHOR Corporation Stock Option Plan (7) 10.19 Employment Agreement dated March 18, 2002, between the Corporation and Peter P. McCann (14) 10.20 Consulting Agreement dated August 31, 2001, between the Corporation and Michael K. Allio (8) 10.21 Amendment to Consulting Agreement dated August 21, 2002, between the Corporation and Michael K. Allio 10.22 Employment Agreement dated March 18, 2002, between the Corporation and Dr. Joseph D. Mosca (15) 10.23 Separation Agreement and Release dated January 31, 2003, between the Corporation and Peter P. McCann 10.24 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and Robert Demers (8) 10.25 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and Michael K. Allio (8) 10.26 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and John M. Musacchio (8) 10.27 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and Patrice Pactol (8) 10.28 Director and Non-Employee Stock Option Agreement dated July 19, 2001, between the Corporation and Pierre-Francois Serres (8) 10.29 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Pierre-Francois Serres 10.30 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Patrice Pactol 10.31 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Robert Demers 10.32 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and John M. Musacchio 10.33 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Michael K. Allio 10.34 Director and Non-Employee Stock Option Agreement dated August 21, 2002, between the Corporation and Michael K. Allio 10.35 Director and Non-Employee Stock Option Agreement dated June 20, 2002, between the Corporation and Peter P. McCann 10.36 Director and Non-Employee Stock Option Agreement dated July 23, 2002, between the Corporation and Peter P. McCann 10.37 Director and Non-Employee Stock Option Agreement dated February 6, 2003, between the Corporation and Peter P. McCann 10.38 Patent Pledge Agreement dated November __, 2002 among Mymetics S.A., Mymetics Deutschland GmbH, the Corporation and MFC Merchant Bank S.A. 11 Statement Regarding Calculation of Per Share Earnings. |
ICHOR CORPORATION AND SUBSIDIARY CONSOLIDATED STATEMENTS OF CASH FLOWS Years Ended December 31, 2000, 1999 and 1998 (In Thousands of Dollars) 2000 1999 1998 -------- -------- -------- Cash Flows from Operating Activities Net loss $ (330) $ (470) $ (178) Adjustments to reconcile net loss to cash flows from operating activities Equity in loss of unconsolidated subsidiary 61 88 - Gain on disposal of subsidiary (298) - (437) Changes in current assets and liabilities Cash held in escrow - - 145 Accounts receivable 49 504 (254) Advances to affiliates - 540 (270) Accounts payable 78 21 (115) Advances from affiliates - (160) 352 Other - 51 (100) -------- -------- -------- Net cash provided by (used in) operating activities (440) 574 (857) Cash Flows from Investing Activities Proceeds from sale of note receivable to a subsidiary of MFC 600 - - Change in note receivable - 2,080 (1,400) Advances to unconsolidated subsidiary - (451) - Investment - - (50) -------- -------- -------- Net cash provided by (used in) investing activities 600 1,629 (1,450) Cash Flows from Financing Activities Proceeds from issuance of preferred shares - - 2,230 Proceeds from issuance of common shares - 9 - Redemption of preferred shares from other subsidiaries of MFC (2,171) - - Dividend on preferred shares (51) - - -------- -------- -------- Net cash provided by (used in) financing activities (2,222) 9 2,230 -------- -------- -------- Increase (decrease) in cash (2,062) 2,212 (77) Cash, beginning of year 2,262 50 127 -------- -------- -------- Cash, end of year $ 200 $ 2,262 $ 50 ======== ======== ======== The accompanying notes are an integral part of these financial statements. |
“Internal control over financial reporting” is defined in Rule 13a-15(f) or 15d-15(f) under the Exchange Act as a process designed by, or under the supervision of, a company’s principal executive and principal financial officers and effected by a company’s board of directors, management and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with U.S. generally accepted accounting principles and includes those policies and procedures that: ● pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of a company; ● provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. generally accepted accounting principles and that receipts and expenditures of a company are being made only in accordance with authorizations of management and directors of a company; and ● provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of a company’s assets that could have a material effect on the financial statements. |
Increased mortgage defaults and foreclosures may adversely affect our business as they increase our expenses and reduce the number of mortgages we service; 11 Mr. Cooper Group Inc. - 2020 Annual Report on Form 10-K Originations: •an increase in interest rates could adversely affect our loan originations volume because refinancing an existing loan would be less attractive for homeowners and qualifying for a purchase money loan may be more difficult for consumers; •an increase in interest rates could also adversely affect our production margins due to increased competition among originators; Xome: •a substantial and sustained increase in prevailing interest rates could adversely affect the loan origination volumes of Xome’s clients since refinancing and purchase loans would be less attractive to borrowers, which would in turn adversely impact Xome Solutions’ valuation and Xome Title’s title order volume; •an increase in interest rates could adversely affect Xome Exchange’s property sales, particularly non-distressed sales, as financing may become less attractive to borrowers; Other: •an increase in interest rates would increase the cost of servicing our outstanding debt, including our ability to finance servicing advances and loan originations and for borrowing for acquisitions; and •a decrease in interest rates could reduce our earnings from our custodial deposit accounts. |
Those fluctuations could be based on various factors, including: •our operating performance and the performance of our competitors and fluctuations in our operating results; •macro-economic trends, including changes in interest rates and economic growth and unemployment; •the public’s reaction to our press releases, our other public announcements and our filings with the SEC; •changes in earnings estimates or recommendations by research analysts who follow us or other companies in our industry; •global, national or local economic, legal and regulatory factors unrelated to our performance; •announcements of negative news by us or our competitors, such as announcements of poorer than expected results of operations, data breaches or significant litigation; •actual or anticipated variations in our or our competitors’ operating results, and our or our competitors’ growth rates; •failure by us or our competitors to meet analysts’ projections or guidance we or our competitors may give the market; •changes in laws or regulations, or new interpretations or applications of laws and regulations, that are applicable to our business; •changes in accounting standards, policies, guidance, interpretations or principles; •the departure of key personnel; •the number of shares publicly traded; •the converted Series B preferred stockholders selling their shares; and •other developments affecting us, our industry or our competitors. |
Increased mortgage defaults and foreclosures may adversely affect our business as they increase our expenses and reduce the number of mortgages we service; Originations Segment •an increase in interest rates could adversely affect our loan originations volume because refinancing an existing loan would be less attractive for homeowners and qualifying for a purchase money loan may be more difficult for consumers; •an increase in interest rates could also adversely affect our production margins due to increased competition among originators; Xome Segment •an increase in interest rates could adversely affect Xome Exchange’s property sales, particularly non-distressed sales, as financing may become less attractive to borrowers; and •a substantial and sustained increase in prevailing interest rates could adversely affect the loan origination volumes of Xome’s clients since refinancing and purchase loans would be less attractive to borrowers, which would in turn adversely impact Xome Solutions’ valuation and Xome Title’s title order volume. |
One or more of the following factors frequently contribute to this inherent unpredictability: the proceeding is in its early stages; the damages sought are unspecified, unsupported or uncertain; it is unclear whether a case brought as a class action will be allowed to proceed on that basis or, if permitted to proceed as a class action, how the class will be defined; the other party is seeking relief other than or in addition to compensatory damages (including, in the case of regulatory and governmental investigations and inquiries, the possibility of fines and penalties); the matter presents meaningful legal uncertainties, including novel issues of law; the Company has not engaged in meaningful settlement discussions; discovery has not started or is not complete; there are significant facts in dispute; predicting possible outcomes depends on making assumptions about future decisions of courts or governmental or regulatory bodies or the behavior of other parties; and there are a large number of parties named as defendants (including where it is uncertain how damages or liability, if any, will be shared among multiple defendants). |
Increased mortgage defaults and foreclosures may adversely affect our business as they increase our expenses and reduce the number of mortgages we service; Originations: • an increase in interest rates could adversely affect our loan originations volume because refinancing an existing loan would be less attractive for homeowners and qualifying for a purchase money loan may be more difficult for consumers; • an increase in interest rates could also adversely affect our production margins due to increased competition among originators; Xome: • a substantial and sustained increase in prevailing interest rates could adversely affect the loan origination volumes of Xome’s clients since refinancing and purchase loans would be less attractive to borrowers, which would in turn adversely impact Xome Services’ valuation and title order volume; • an increase in interest rates could adversely affect Xome Exchange’s property sales, particularly non-distressed sales, as financing may become less attractive to borrowers; Other: • an increase in interest rates would increase the cost of servicing our outstanding debt, including our ability to finance servicing advances and loan originations and for borrowing for acquisitions; and • a decrease in interest rates could reduce our earnings from our custodial deposit accounts. |
Certain strategic initiatives, which are designed to improve our results of operations and drive long-term stockholder value, include: • strengthen our balance sheet by building capital and liquidity, reducing leverage, taking advantage of market conditions to refinance existing senior notes, and implementing derivative hedging strategies; • drive stronger profitability through a variety of efficiency initiatives, including ongoing improvement in unit cost economics in servicing, originations, and Xome, as well as finalizing our Project Titan servicing transformation initiative and identifying and realizing other opportunities for cost savings throughout the organization; • improve results at Xome by winning new third-party customers and gaining wallet share with existing customers by cross-selling multiple services and by delivering strong performance and excellent customer service; • continue to focus on improving the customer experience in all of our segments, as well as sustaining the culture and talent of our workforce; and • maintain strong relationships with agencies, investors, regulators, and other constituencies and a strong reputation for compliance and customer service. |
Those fluctuations could be based on various factors, including: • our operating performance and the performance of our competitors and fluctuations in our operating results; • macro-economic trends, including changes in interest rates and economic growth and unemployment; • the public’s reaction to our press releases, our other public announcements and our filings with the SEC; • changes in earnings estimates or recommendations by research analysts who follow us or other companies in our industry; • global, national or local economic, legal and regulatory factors unrelated to our performance; • announcements of negative news by us or our competitors, such as announcements of poorer than expected results of operations, data breaches or significant litigation; • actual or anticipated variations in our or our competitors’ operating results, and our or our competitors’ growth rates; • failure by us or our competitors to meet analysts’ projections or guidance we or our competitors may give the market; • changes in laws or regulations, or new interpretations or applications of laws and regulations, that are applicable to our business; • changes in accounting standards, policies, guidance, interpretations or principles; • the departure of key personnel; • the number of shares publicly traded; • the converted Series B preferred stockholders selling their shares; and • other developments affecting us, our industry or our competitors. |
Key strategic initiatives include the following: • Strengthen our balance sheet by building capital and liquidity, reducing leverage, taking advantage of market conditions to refinance existing senior notes, and implementing derivative hedging strategies; • Drive stronger profitability through a variety of efficiency initiatives, including ongoing improvement in unit cost economics in Servicing, Originations, and Xome, as well as finalizing our Project Titan servicing transformation initiative and identifying and realizing other opportunities for cost savings throughout the organization; • Improve results at Xome by winning new third-party customers and gaining wallet share with existing customers by cross-selling multiple services and by delivering strong performance and excellent customer service; • Continue to focus on improving the customer experience in all of our segments, as well as sustaining the culture and talent of our workforce; and • Maintain strong relationships with agencies, investors, regulators, and other constituencies and a strong reputation for compliance and customer service. |
Increased mortgage defaults and foreclosures may adversely affect our business as they increase our expenses and reduce the number of mortgages we service; Originations Segment • an increase in interest rates could adversely affect our loan originations volume because refinancing an existing loan would be less attractive for homeowners and qualifying for a purchase money loan may be more difficult for consumers; • an increase in interest rates could also adversely affect our production margins due to increased competition among originators; Xome Segment • an increase in interest rates could adversely affect Xome Exchange’s property sales, particularly non-distressed sales, as financing may become less attractive to borrowers; and • a substantial and sustained increase in prevailing interest rates could adversely affect the loan origination volumes of Xome’s clients since refinancing and purchase loans would be less attractive to borrowers, which would in turn adversely impact Xome Services’ valuation and title order volume. |
One or more of the following factors frequently contribute to this inherent unpredictability: the proceeding is in its early stages; the damages sought are unspecified, unsupported or uncertain; it is unclear whether a case brought as a class action will be allowed to proceed on that basis or, if permitted to proceed as a class action, how the class will be defined; the other party is seeking relief other than or in addition to compensatory damages (including, in the case of regulatory and governmental investigations and inquiries, the possibility of fines and penalties); the matter presents meaningful legal uncertainties, including novel issues of law; the Company has not engaged in meaningful settlement discussions; discovery has not started or is not complete; there are significant facts in dispute; predicting possible outcomes depends on making assumptions about future decisions of courts or governmental or regulatory bodies or the behavior of other parties; and there are a large number of parties named as defendants (including where it is uncertain how damages or liability, if any, will be shared among multiple defendants). |
Increased mortgage defaults and foreclosures may adversely affect our business as they increase our expenses and reduce the number of mortgages we service; Originations: • an increase in interest rates could adversely affect our loan originations volume because refinancing an existing loan would be less attractive for homeowners and qualifying for a purchase money loan may be more difficult for consumers; • an increase in interest rates could also adversely affect our production margins due to increased competition among originators; Xome: • a substantial and sustained increase in prevailing interest rates could adversely affect the loan origination volumes of Xome’s clients since refinancing and purchase loans would be less attractive to borrowers, which would in turn adversely impact Xome Services’ valuation and title order volume; • an increase in interest rates could adversely affect Xome Exchange’s property sales, particularly non-distressed sales, as financing may become less attractive to borrowers; Other: • an increase in interest rates would increase the cost of servicing our outstanding debt, including our ability to finance servicing advances and loan originations and for borrowing for acquisitions; and • a decrease in interest rates could reduce our earnings from our custodial deposit accounts. |
Those fluctuations could be based on various factors, including: • our operating performance and the performance of our competitors and fluctuations in our operating results; 31 Mr. Cooper Group Inc. - 2018 Annual Report on Form 10-K • macro economic trends, including changes in interest rates and economic growth and unemployment; • the public’s reaction to our press releases, our other public announcements and our filings with the SEC; • changes in earnings estimates or recommendations by research analysts who follow us or other companies in our industry; • global, national or local economic, legal and regulatory factors unrelated to our performance; • announcements of negative news by us or our competitors, such as announcements of poorer than expected results of operations, data breaches or significant litigation; • actual or anticipated variations in our or our competitors’ operating results, and our or our competitors’ growth rates; • failure by us or our competitors to meet analysts’ projections or guidance we or our competitors may give the market; • changes in laws or regulations, or new interpretations or applications of laws and regulations, that are applicable to our business; • changes in accounting standards, policies, guidance, interpretations or principles; • the departure of key personnel; • the number of shares publicly traded; • the converted Series B preferred stockholders selling their shares; and • other developments affecting us, our industry or our competitors. |
Increased mortgage defaults and foreclosures may adversely affect our business as they increase our expenses and reduce the number of mortgages we service; Originations Segment • an increase in interest rates could adversely affect our loan originations volume because refinancing an existing loan would be less attractive for homeowners and qualifying for a purchase money loan may be more difficult for consumers; • an increase in interest rates could also adversely affect our production margins due to increased competition among originators; Xome Segment • an increase in interest rates could adversely affect Xome Exchange’s property sales, particularly non-distressed sales, as financing may become less attractive to borrowers; • a substantial and sustained increase in prevailing interest rates could adversely affect the loan origination volumes of Xome’s clients since refinancing and purchase loans would be less attractive to borrowers, which would in turn adversely impact Xome Services’ valuation and title order volume; We actively manage the risk profiles of interest rate lock commitments (“IRLCs”) and mortgage loans held for sale on a daily basis and enter into forward sales of MBS in an amount equal to the portion of the IRLC expected to close, assuming no change in mortgage interest rates. |
One or more of the following factors frequently contribute to this inherent unpredictability: the proceeding is in its early stages; the damages sought are unspecified, unsupported or uncertain; it is unclear whether a case brought as a class action will be allowed to proceed on that basis or, if permitted to proceed as a class action, how the class will be defined; the other party is seeking relief other than or in addition to compensatory damages (including, in the case of regulatory and governmental investigations and inquiries, the possibility of fines and penalties); the matter presents meaningful legal uncertainties, including novel issues of law; the Company has not engaged in meaningful settlement discussions; discovery has not started or is not complete; there are significant facts in dispute; predicting possible outcomes depends on making assumptions about future decisions of courts or governmental or regulatory bodies or the behavior of other parties; and there are a large number of parties named as defendants (including where it is uncertain how damages or liability, if any, will be shared among multiple defendants). |
The obligations of WMIH and Nationstar to complete the Nationstar Transaction are subject to satisfaction or waiver of a number of conditions, including, among others (i) the adoption of the Merger Agreement by the holders of a majority of Nationstar’s outstanding common stock; (ii) the approval of the issuance of shares of WMIH Common Stock by a majority of all votes cast by holders of outstanding shares of WMIH Common Stock and preferred stock (voting on an as-converted basis in accordance with WMIH’s Certificate of Incorporation); (iii) the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended; (iv) obtaining required regulatory approvals as specified in the schedules to the Merger Agreement without the imposition of a condition that would have a material adverse effect on the combined surviving company and its subsidiaries, taken as a whole, following the Merger (“Burdensome Condition”); (v) the effectiveness of a registration statement on Form S-4 relating to the Merger; (vi) the approval for listing the WMIH Common Stock issuable in the Merger on the Nasdaq Stock Market LLC, subject to official notice of issuance; (vii) there being no law or injunction prohibiting consummation of the transactions contemplated under the Merger Agreement; (viii) subject to specified materiality standards, the continuing accuracy of certain representations and warranties of each party; and (ix) performance by each party in all material respects with its covenants. |
These interests include but not are not limited to: • the rights of certain executive officers to receive payments or other benefits in connection with, upon and following the consummation of a Qualified Acquisition or a change in control; • the expected service of Chris Harrington, Tagar Olson and Steven Scheiwe as directors following the Merger; • the continued indemnification of directors and officers following the Merger for acts or omissions that occurred in their capacity as directors or officers prior to the closing of the Merger; • payments to KCM, an affiliate of certain of our directors, in connection with the closing of the Merger including $8.25 million pursuant to an engagement letter, $25.0 million pursuant to a financial advisory engagement letter and a fee of 0.25% of the aggregate amount of the aggregate commitments under a $2.75 billion bridge facility upon initial funding under a placement agent fee letter; and • the issuance of 21,197,619 shares of our common stock to KKR Wand Holdings, an affiliate of certain of our directors, in exchange for certain common stock purchase warrants, conditioned upon the effectiveness of the Merger. |
WMIH received other income in the amount of $0.1 million, $0.1 million and $7.8 million, respectively, in the years ended December 31, 2017, December 31, 2016 and December 31, 2015, respectively, as a result of the settlement by the Trust of the D&O Litigation and distribution, by the Trust, of litigation proceeds to WMIH, which is further described in Note 6: Service Agreements and Related Party Transactions, to the consolidated financial information in Part II, Item 8 of this Annual Report on Form 10-K and in this Item 7 under “Contractual Obligations, Commitments and Contingencies.” Due to the contingent nature of any further distribution of litigation proceeds by the Trust, there can be no assurance that WMIH will receive any distributions on account of litigation proceeds from the Trust in the future, as described further below in this Item 7 under “Contractual Obligations, Commitments and Contingencies.” Underwriting expenses (defined as losses, loss adjustment expenses and ceding commission expenses) totaled $0.2 million for the year ended December 31, 2017, resulting in a negative change of $0.6 million and $0.9 million, respectively, compared to underwriting recoveries of $0.4 million and $0.7 million, respectively, for the years ended December 31, 2016 and 2015. |
For the period commencing on December 8, 2017, (the “Amendment Date”), and ending on the date that is eighteen (18) months following January 5, 2018, (the “Amendment Effective Time,” for so long as (1) KKR Fund has not Transferred any, and together with the KKR Affiliates continues to beneficially own (with the unencumbered right to vote) all, of the Series A Preferred Stock it owns as of the Amendment Date, (2) KKR Fund has not Transferred any, and together with the KKR Affiliates continues to beneficially own (with the unencumbered right to vote) all, Warrants it owns as of the Amendment Date or any of the Common Stock issuable upon the exercise thereof, and (3) KKR Wand has not transferred, in the aggregate, more than, and together with the KKR Affiliates continues to beneficially own (with the unencumbered right to vote) at least, 50% of the Series B Preferred Stock it owns as of the date hereof, the Company shall not enter into a definitive agreement with respect to any target acquisition without the prior written consent of KKR Fund; provided, however, that if KKR Fund does not give written notice to the Company of its approval of, or objection to, a proposed target acquisition within five (5) business days of having received notice of the material definitive terms of such target acquisition, KKR Fund shall be deemed to have approved such target acquisition and the Company may pursue such target acquisition, including by entering into a definitive material agreement in respect thereof, without the prior written consent of KKR Fund hereunder. |
The foregoing description of (i) the Investor Rights Agreement is qualified in its entirety by reference to the Investor Rights Agreement, which was filed with the Securities and Exchange Commission (the “SEC”) as Exhibit 4.2 on Form 8-K on January 31, 2014, and incorporated by reference, (ii) the Warrants are qualified in their entirety by reference to the Form of Tranche A Warrant and Form of Tranche B Warrant, which were filed with the SEC as Exhibits 4.3 and 4.4, respectively, on Form 8-K on January 31, 2014, and incorporated by reference, (iii) the Series A Preferred Stock is qualified in its entirety by reference to the Articles of Amendment of WMIH dated January 30, 2014, which were filed with the SEC as Exhibit 4.5 on Form 8-K on January 31, 2014, and incorporated by reference, the Form of Series A Convertible Preferred Stock Certificate, which was filed with the SEC as Exhibit 4.6 on Form 8-K on January 31, 2014, and incorporated by reference, and the Certificate of Incorporation, which was filed with the SEC as Exhibit 3.1 on Form 8-K12G3 on May 13, 2015, and incorporated by reference, (iv) the Investment Agreement is qualified in its entirety by reference to the Investment Agreement, which was filed with the SEC as Exhibit 10.1 on Form 8-K on January 31, 2014, and incorporated by reference, and (v) the Investment Agreement is qualified in its entirety by reference to the Letter Agreement dated December 8, 2017, by and among the Company, KKR Fund Holdings L.P. and KKR Wand Investors L.P., which was filed with the SEC as Exhibit 10.3 on Form 8-K on December 11, 2017, and incorporated by reference. |
The Series B Amendment, which was approved by the holders of 308,731, or approximately 51%, of the 600,000 issued and outstanding shares of Series B Preferred Stock, amended certain terms of WMIH’s issued and outstanding 3.00% Series B Convertible Preferred Stock, par value $0.00001 per share, to, among other things: • extend the Series B Redemption Date (as defined in the Existing Charter) from January 5, 2018 to October 5, 2019 (subject to a six-month extension in accordance with the terms of the Series B Amendment); • amend the Conversion Price (as defined in the Existing Charter) relating to a Mandatory Conversion (as defined in the Existing Charter) of the Series B Preferred Stock to $1.35 per share of WMIH’s common stock, par value $0.00001 per share; • change the quarterly 3.00% dividend payable in cash to a semi-annual 5.00% dividend payable in Common Stock (the “Regular Dividend”) if, as and when declared by WMIH’s Board of Directors; • provide for a special distribution of 19.04762 shares of common stock per share of Series B Preferred Stock upon the closing of any Acquisition (as defined in the Amended Charter); and • provided for a special stub dividend payable which was declared and paid by WMIH’s Board of Directors in cash for dividends accruing on the Series B Preferred Stock payable in arrears for the period December 15, 2017 to January 4, 2018. |
WMIH received other income in the amount of $0.1 million and $7.8 million, respectively, in the years ended December 31, 2016 and December 31, 2015, respectively, as a result of the settlement by the Trust of the D&O Litigation and distribution by the Trust of Litigation Proceeds to WMIH, which is further described in Note 6: Service Agreements and Related Party Transactions, to the consolidated financial information in Part II, Item 8 of this Annual Report on Form 10-K and in this Item 7 under “Contractual Obligations, Commitments and Contingencies.” Due to the contingent nature of any further distribution of Litigation Proceeds, there can be no assurance that WMIH will receive any distributions on account of Litigation Proceeds in the future, as described further below in this Item 7 under “Contractual Obligations, Commitments and Contingencies.” Underwriting recoveries (defined as losses, loss adjustment expenses and ceding commission expenses) totaled $0.4 million for the year ended December 31, 2016, resulting in a decrease in recoveries of $0.3 million and a change from expense to recoveries of $3.5 million, compared to underwriting recoveries of $0.7 million and underwriting expenses of $3.9 million, respectively, for the years ended December 31, 2015 and 2014. |
The foregoing description of (i) the Investor Rights Agreement is qualified in its entirety by reference to the Investor Rights Agreement, which was filed with the Securities and Exchange Commission (the “SEC”) as Exhibit 4.2 on Form 8-K on January 31, 2014, and incorporated by reference, (ii) the Warrants are qualified in their entirety by reference to the Form of Tranche A Warrant and Form of Tranche B Warrant, which were filed with the SEC as Exhibits 4.3 and 4.4, respectively, on Form 8-K on January 31, 2014, and incorporated by reference, and (iii) the Series A Preferred Stock is qualified in its entirety by reference to the Articles of Amendment of WMIH dated January 30, 2014, which were filed with the SEC as Exhibit 4.5 on Form 8-K on January 31, 2014, and incorporated by reference, the Form of Series A Convertible Preferred Stock Certificate, which was filed with the SEC as Exhibit 4.6 on Form 8-K on January 31, 2014, and incorporated by reference, and the Certificate of Incorporation, which was filed with the SEC as Exhibit 3.1 on Form 8-K12G3 on May 13, 2015, and incorporated by reference. |
WMIH received other income in the amount of $7.8 million as a result of the settlement by the Trust of the D&O Litigation and distribution by the Trust of Litigation Proceeds to WMIH, which is further described in Note 6: Service Agreements and Related Party Transactions, to the consolidated financial information in Part II, Item 8 of this Annual Report on Form 10-K and in this Part II under “Contractual Obligations, Commitments and Contingencies.” Due to the contingent nature of any further distribution of Litigation Proceeds, there can be no assurance that WMIH will receive any distributions on account of Litigation Proceeds in the future, as described further below in this Part II under “Contractual Obligations, Commitments and Contingencies.” Underwriting recoveries (defined as losses, loss adjustment expenses and ceding commission expenses) totaled $0.7 million for the year ending December 31, 2015, resulting in a decrease in expense of $4.6 million and an increase in expense of $4.1 million, compared to underwriting expenses of $3.9 million and underwriting recoveries of $4.8 million, respectively, for the years ending December 31, 2014 and 2013. |
In connection with the issuance of the Series A Preferred Stock and the Warrants, KKR Fund and its affiliates have agreed that, until December 31, 2016, they will not: ● request the call of a special meeting of the stockholders of WMIH; seek to make, or make, a stockholder proposal at any meeting of the stockholders of WMIH; seek the removal of any director from the Board; or make any “solicitation” of “proxies” (as such terms are used in the proxy rules of the SEC) or solicit any written consents of stockholders with respect to any matter; ● form or join or participate in a “partnership, limited partnership, syndicate or other group” within the meaning of Section 13(d)(3) of the Exchange Act, with respect to any voting securities of WMIH; ● make or issue, or cause to be made or issued, any public disclosure, statement or announcement (including filing reports with the SEC) (x) in support of any solicitation described above, or (y) negatively commenting upon WMIH; ● except pursuant to any exercise of any Warrant, the conversion of the Series A Preferred Stock, or the exercise of the Participation Rights, acquire, agree or seek to acquire, beneficially or otherwise, any voting securities of WMIH (other than securities issued pursuant to a plan established by the Board for members of the Board, a stock split, stock dividend distribution, spin-off, combination, reclassification or recapitalization of WMIH and its common stock or other similar corporate action initiated by WMIH); ● enter into any discussions, negotiations, agreements or undertakings with any person with respect to the foregoing or advise, assist, encourage or seek to persuade others to take any action with respect to the foregoing, except pursuant to mandates granted by WMIH to raise capital by WMIH to KKR Capital Markets LLC and its affiliates; or ● short any of WMIH’s common stock or acquire any derivative or hedging instrument or contract relating to WMIH’s common stock. |
The foregoing description of (i) the Investor Rights Agreement is qualified in its entirety by reference to the Investor Rights Agreement, which was filed with the SEC as Exhibit 4.2 on Form 8-K on January 31, 2014, and incorporated by reference, (ii) the Warrants are qualified in their entirety by reference to the Form of Tranche A Warrant and Form of Tranche B Warrant, which were filed with the SEC as Exhibits 4.3 and 4.4, respectively, on Form 8-K on January 31, 2014, and incorporated by reference, (iii) the Series A Preferred Stock is qualified in its entirety by reference to the Series A Articles of Amendment, which were filed with the SEC as Exhibit 4.5 on Form 8-K on January 31, 2014, and incorporated by reference, and the Form of Series A Convertible Preferred Stock Certificate, which was filed with the SEC as Exhibit 4.6 on Form 8-K on January 31, 2014, and incorporated by reference, and the Amended and Restated Certificate of Incorporation of WMIH, which was filed with the SEC as Exhibit 3.1 on Form 8-K12G3 on May 13, 2015, and incorporated by reference, and (iv) the Investment Agreement is qualified in its entirety by reference to the Investment Agreement, which was filed with the SEC as Exhibit 10.1 on Form 8-K on January 31, 2014, and incorporated by reference. |
In connection with the Plan becoming effective, among other things: ● approximately $6.5 billion was distributed to parties-in-interest on account of their allowed claims; ● WMIHC received $75.0 million in cash from certain creditors; ● WMIHC obtained access to a $125.0 million senior credit facility, approximately $25.0 million of which can be used for working capital and $100.0 million of which can be utilized in addition to the amount available for working capital for certain acquisitions and originations, subject to certain criteria and conditions set forth in the Financing Agreement (see Note 9: Financing Arrangements); ● WMIHC issued: (a) $110.0 million aggregate principal amount of its 13% Senior First Lien Notes due 2030 (the “First Lien Notes”) under an indenture, dated as of March 19, 2012 (the “First Lien Indenture”), between WMIHC and Wilmington Trust, National Association, as Trustee; and (b) $20.0 million aggregate principal amount of its 13% Senior Second Lien Notes due 2030 (the “Second Lien Notes” and, together with the First Lien Notes, the “Runoff Notes”) under an indenture, dated as of March 19, 2012 (the “Second Lien Indenture” and, together with the First Lien Indenture, the “Indentures”), between WMIHC and Law Debenture Trust Company of New York, as Trustee; and with limited exceptions the Runoff Notes are solely payable from Runoff Proceeds Distributions (as defined in the Indentures) received by WMIHC from WMMRC, and therefore are generally nonrecourse to WMIHC (see Note 8: Notes Payable); ● WMIHC issued 200,000,000 shares of common stock, of which 194,670,501 shares were issued to new WMIHC shareholders and 5,329,499 shares of common stock were issued and deposited into a Disputed Equity Escrow (as defined in the Plan); and ● based on our analysis, we believe WMIHC experienced an ownership change under Section 382 of the Internal Revenue Code (the “Code”). |
In connection with the issuance of the Convertible Preferred Stock and the Warrants, KKR Fund and its affiliates have agreed that, until December 31, 2016, they will not: ● request the call of a special meeting of the shareholders of WMIHC; seek to make, or make, a shareholder proposal at any meeting of the shareholders of WMIHC; seek the removal of any director from the Board; or make any “solicitation” of “proxies” (as such terms are used in the proxy rules of the SEC) or solicit any written consents of shareholders with respect to any matter; ● form or join or participate in a “partnership, limited partnership, syndicate or other group” within the meaning of Section 13(d)(3) of the Exchange Act, with respect to any voting securities of WMIHC; ● make or issue, or cause to be made or issued, any public disclosure, statement or announcement (including filing reports with the SEC) (x) in support of any solicitation described above, or (y) negatively commenting upon WMIHC; ● except pursuant to any exercise of any Warrant, the conversion of the Convertible Preferred Stock, or the exercise of the Participation Rights, acquire, agree or seek to acquire, beneficially or otherwise, any voting securities of WMIHC (other than securities issued pursuant to a plan established by the Board for members of the Board, a stock split, stock dividend distribution, spin-off, combination, reclassification or recapitalization of WMIHC and its common stock or other similar corporate action initiated by WMIHC); ● enter into any discussions, negotiations, agreements or undertakings with any person with respect to the foregoing or advise, assist, encourage or seek to persuade others to take any action with respect to the foregoing, except pursuant to mandates granted by WMIHC to raise capital by WMIHC to KKR Capital Markets LLC and its affiliates; or ● short any of WMIHC’s common stock or acquire any derivative or hedging instrument or contract relating to WMIHC’s common stock. |
The foregoing description of (i) the Investor Rights Agreement is qualified in its entirety by reference to the Investor Rights Agreement, which was filed with the SEC as Exhibit 4.2 on Form 8-K on January 31, 2014, and incorporated by reference, (ii) the Warrants are qualified in their entirety by reference to the Form of Tranche A Warrant and Form of Tranche B Warrant, which were filed with the SEC as Exhibits 4.3 and 4.4, respectively, on Form 8-K on January 31, 2014, and incorporated by reference, (iii) the Convertible Preferred Stock is qualified in its entirety by reference to the Series A Articles of Amendment, which were filed with the SEC as Exhibit 4.5 on Form 8-K on January 31, 2014, and incorporated by reference, and the Form of Series A Convertible Preferred Stock Certificate, which was filed with the SEC as Exhibit 4.6 on Form 8-K on January 31, 2014, and incorporated by reference and (iv) the Investment Agreement is qualified in its entirety by reference to the Investment Agreement, which was filed with the SEC as Exhibit 10.1 on Form 8-K on January 31, 2014, and incorporated by reference. |
On January 5, 2015, in connection with the Offering and pursuant to that certain Purchase Agreement, dated December 19, 2014 (the “Purchase Agreement”), by and among WMIHC, Citigroup Global Markets Inc. (“Citi”) and KKR Capital Markets LLC (“KCM” and, together with Citi, the “Initial Purchasers”), WMIHC entered into a Registration Rights Agreement with the Initial Purchasers (the “Registration Rights Agreement”), pursuant to which WMIHC has agreed that, subject to certain conditions, WMIHC will use its reasonable efforts to (i) file a shelf registration statement covering resales of common stock issuable upon mandatory conversion of the Series B Preferred Stock pursuant to Rule 415 under the Securities Act of 1933, as amended (the “Securities Act”) no later than six months after January 5, 2015 (the “Issue Date”); (ii) file a shelf registration statement covering resales of the Series B Preferred Stock pursuant to Rule 415 under the Securities Act no later than one year after the Issue Date; and (iii) cause each of these shelf registration statements to be declared effective under the Securities Act. |
In connection with the Plan becoming effective, among other things: • approximately $6.5 billion was distributed to parties-in-interest on account of their allowed claims; • WMIHC received $75.0 million in cash from certain creditors; • WMIHC obtained access to a $125.0 million senior credit facility, approximately $25.0 million of which can be used for working capital and $100.0 million of which can be utilized in addition to the amount available for working capital for certain acquisitions and originations, subject to certain criteria and conditions set forth in the Financing Agreement (see Note 9: Financing Arrangements); • WMIHC issued: (a) $110.0 million aggregate principal amount of its 13% Senior First Lien Notes due 2030 (the “First Lien Notes”) under an indenture, dated as of March 19, 2012 (the “First Lien Indenture”), between WMIHC and Wilmington Trust, National Association, as Trustee; and (b) $20.0 million aggregate principal amount of its 13% Senior Second Lien Notes due 2030 (the “Second Lien Notes” and, together with the First Lien Notes, the “Runoff Notes”) under an indenture, dated as of March 19, 2012 (the “Second Lien Indenture” and, together with the First Lien Indenture, the “Indentures”), between WMIHC and Law Debenture Trust Company of New York, as Trustee; and with limited exceptions the Runoff Notes are solely payable from Runoff Proceeds Distributions (as defined in the Indentures) received by WMIHC from WMMRC, and therefore are generally nonrecourse to WMIHC (see Note 8: Notes Payable); • WMIHC issued 200,000,000 shares of common stock, of which 194,670,501 shares were issued to new WMIHC shareholders and 5,329,499 shares of common stock were issued and deposited into a Disputed Equity Escrow (as defined in the Plan); and • based on our analysis, we believe WMIHC experienced an ownership change under Section 382 of the Internal Revenue Code (the “Code”). |
General The foregoing description of (i) the Note Purchase Agreement is qualified in its entirety by reference to the Note Purchase Agreement, which was filed with the SEC as Exhibit 4.1 on Form 8-K on January 31, 2014, and incorporated by reference, (ii) the Investor Rights Agreement is qualified in its entirety by reference to the Investor Rights Agreement, which was filed with the SEC as Exhibit 4.2 on Form 8-K on January 31, 2014, and incorporated by reference, (iii) the Warrants are qualified in their entirety by reference to the Form of Tranche A Warrant and Form of Tranche B Warrant, which were filed with the SEC as Exhibits 4.3 and 4.4, respectively, on Form 8-K on January 31, 2014, and incorporated by reference, (iv) the Convertible Preferred Stock is qualified in its entirety by reference to the Articles of Amendment, which were filed with the SEC as Exhibit 4.5 on Form 8-K on January 31, 2014, and incorporated by reference, and the Form of Series A Convertible Preferred Stock Certificate, which was filed with the SEC as Exhibit 4.6 on Form 8-K on January 31, 2014, and incorporated by reference and (v) the Investment Agreement is qualified in its entirety by reference to the Investment Agreement, which was filed with the SEC as Exhibit 10.1 on Form 8-K on January 31, 2014, and incorporated by reference. |
Across our markets and segments, the principal competitive factors can include, among others: •the ability to meet business needs and drive successful outcomes; •functionality, speed, capacity, scalability and performance of network solutions; •price for performance, cost per bit and total cost of ownership of network solutions; •incumbency and strength of existing business relationships; •technology roadmap and forward innovation capacity; •time-to-market in delivering products and features; •company stability and financial health; •ability to offer comprehensive networking solutions, consisting of hardware, software and services; •flexibility and openness of platforms, including ease of integration, interoperability and integrated management; •ability to offer solutions that accommodate a range of different consumption models; •operating costs, space requirements and power consumption of network solutions; •software and network automation capabilities; •manufacturing and lead-time capability; and •services and support capabilities. |
Additional factors that contribute to fluctuations in our revenue, gross margin and operating results include: •changes in spending levels or network deployment plans by customers, particularly with respect to our service provider and Web-scale provider customers; •order timing and volume, including book to revenue orders; •shipment and delivery timing; •backlog levels; •the level of competition and pricing pressure in our industry; •the pace and impact of price erosion that we regularly encounter in our markets; •the impact of commercial concessions or unfavorable commercial terms required to maintain incumbency or secure new opportunities with key customers; •the mix of revenue by product segment, geography and customer in any particular quarter; •our level of success in achieving targeted cost reductions and improved efficiencies in our supply chain; •our incurrence of start-up costs, including lower margin phases of projects required to support initial deployments, gain new customers or enter new markets; •our level of success in accessing new markets and obtaining new customers; •long- and short-term changing behaviors or customer needs that impact demand for our products and services or the products and services of our customers; •technology-based price compression and our introduction of new platforms with improved price for performance; •changing market, economic and political conditions, including the impact of tariffs and other trade restrictions or efforts to withdraw from or materially modify international trade agreements; •factors beyond our control such as natural disasters, acts of war or terrorism, and public health emergencies, including the COVID-19 pandemic; •the financial stability of our customers and suppliers; •consolidation activity among our customers, suppliers and competitors; •the timing of revenue recognition on sales, particularly relating to large orders; •installation service availability and readiness of customer sites; •availability of components and manufacturing capacity; •adverse impact of foreign exchange; and •seasonal effects in our business. |
Generally, competition in our markets is based on any one or a combination of the following factors: •the ability to meet customer business needs and drive successful outcomes; •functionality, speed, capacity, scalability, performance, quality and reliability of solutions; •price for performance, cost per bit and total cost of ownership of solutions; •incumbency and strength of existing business relationships; •ability to offer comprehensive networking solutions, consisting of hardware, software and services; •time-to-market in delivering products and features; •technology roadmap and forward innovation capacity and ability to deliver on network innovation; •company stability and financial health; •flexibility and openness of platforms, including ease of integration, interoperability and integrated management; •ability to offer solutions that accommodate a range of emerging customer consumption models for network solutions; •operating costs, space requirements and power consumption of network solutions; •software and network automation and analytics capabilities; •manufacturing and lead-time capability; and •services and support capabilities. |
Our international sales and operations are subject to inherent risks, including: •adverse social, political and economic conditions; •effects of adverse changes in currency exchange rates; •greater difficulty in collecting accounts receivable and longer collection periods; •difficulty and cost of staffing and managing foreign operations; •higher incidence of corruption or unethical business practices; •less protection for intellectual property rights in some countries; •tax and customs changes that adversely impact our global sourcing strategy, manufacturing practices, transfer-pricing, or competitiveness of our products for global sales; •compliance with certain testing, homologation or customization of products to conform to local standards; •significant changes to free trade agreements, trade protection measures, tariffs, export compliance, domestic preference procurement requirements, qualification to transact business and additional regulatory requirements; and •natural disasters, acts of war or terrorism, and public health emergencies, including the COVID-19 pandemic. |
There are a number of risks associated with our dependence on contract manufacturers, including: •reduced control over delivery schedules and planning; •reliance on the quality assurance procedures of third parties; •potential uncertainty regarding manufacturing yields and costs; •availability of manufacturing capability and capacity, particularly during periods of high demand; •risks and uncertainties associated with the locations or countries where our products are manufactured, including potential manufacturing disruptions caused by social, geopolitical, environmental or health factors, including pandemics or widespread health epidemics such as the COVID-19 pandemic; •changes in law or policy governing tax, trade, manufacturing, development and investment in the countries where we currently manufacture our products, including the World Trade Organization Information Technology Agreement or other free trade agreements; •inventory liability for excess and obsolete supply; •limited warranties provided to us; and •potential misappropriation of our intellectual property. |
The following tables set forth the major components of the cash used in working capital (in thousands): As compared to the end of fiscal 2019: •The $17.3 million of cash used in accounts receivable during fiscal 2020 reflects increased sales volume at the end of the fourth quarter of fiscal 2020; •The $25.0 million of cash used in inventory during fiscal 2020 primarily reflects increases in finished goods to meet customer delivery schedules related to some of the actions that we took during the last three quarters of fiscal 2020 to mitigate the risk of adverse supply chain impact on our business and operations due to COVID-19 related disruptions; •The $39.0 million of cash used in prepaid expenses and other during fiscal 2020 primarily reflects increases in upfront future discounts paid to customers; •The $117.9 million of cash used in accounts payable, accruals and other obligations during fiscal 2020 primarily reflects lower employee bonus accrual associated with our annual cash incentive compensation plan and increased payments for inventory purchases; •The $2.5 million of cash provided by deferred revenue during fiscal 2020 represents an increase in advanced payments received from customers prior to revenue recognition; and •The $3.1 million of cash used in operating lease assets and liabilities, net, during fiscal 2020 represents cash paid for operating leases. |
The Refinancing Amendment to Credit Agreement amends Ciena’s credit agreement, dated July 15, 2014, as amended (the “Credit Agreement”) and provides that the New 2025 Term Loan will, among other things: •amortize in equal quarterly installments in aggregate amounts equal to 0.25% of the principal amount of the New 2025 Term Loan as of January 23, 2020, with the balance payable at maturity; •be subject to mandatory prepayment provisions upon the occurrence of certain specified events substantially similar to the 2022 Term Loan, including certain asset sales, debt issuances and receipt of annual Excess Cash Flow (as defined in the Credit Agreement); •bear interest, at Ciena’s election, at a per annum rate equal to (a) LIBOR (subject to a floor of 0.00%) plus an applicable margin of 1.75%, or (b) a base rate (subject to a floor of 1.00%) plus an applicable margin of 1.00%; and •be repayable at any time at Ciena’s election, provided that repayment of the New 2025 Term Loan with proceeds of certain indebtedness prior to July 23, 2020 will require a prepayment premium of 1.00% of the aggregate principal amount of such prepayment. |
Our current development efforts are focused upon: • Reinforcing our coherent optical leadership with continued development that advances reach, transmission speed and spectral efficiency, while minimizing power usage, space and network element requirements; • Executing on parallel innovation paths for the next generation of our modem technology - WaveLogic 5 Extreme (WL5e) and WaveLogic 5 Nano (WL5n) - to address customer requirements ranging from integrated systems to pluggable form factors; • IP/Ethernet-based Packet Networking solutions to support mobile network traffic and network densification initiatives, such as 5G and fiber deep; • Converging packet-based IP and optical network infrastructure to improve network economics and scale, and to enable new services; • Pursuing pluggable and optical module development initiatives to support our optical microsystems business; • Migrating legacy services to next-generation packet infrastructures; • Advancing our software-based domain control, automation and analytics with MCP; and • Integrating the organic and acquired elements of our Blue Planet Automation Software to enable closed loop automation. |
Across our markets and segments, the principal competitive factors can include: • the ability to meet business needs and drive successful outcomes; • functionality, speed, capacity, scalability and performance of network solutions; • price for performance, cost per bit and total cost of ownership of network solutions; • incumbency and strength of existing business relationships; • ability to offer comprehensive networking solutions, consisting of hardware, software and services; • time-to-market in delivering products and features; • technology roadmap and forward innovation capacity; • company stability and financial health; • flexibility and openness of platforms, including ease of integration, interoperability and integrated management; • ability to offer solutions that accommodate a range of different consumption models; • operating costs, space requirements and power consumption of network solutions; • software and network automation capabilities; • manufacturing and lead-time capability; and • services and support capabilities. |
Additional factors that contribute to fluctuations in our revenue, gross margin and operating results include: • changes in spending levels or network deployment plans by customers, particularly with respect to our service provider and Web-scale provider customers; • order timing and volume, including book to revenue orders; • shipment and delivery timing; • backlog levels; • the level of competition and pricing pressure in our industry; • the pace and impact of price erosion that we regularly encounter in our markets; • the impact of commercial concessions or unfavorable commercial terms required to maintain incumbency or secure new opportunities with key customers; • the mix of revenue by product segment, geography and customer in any particular quarter; • our level of success in achieving targeted cost reductions and improved efficiencies in our supply chain; • our incurrence of start-up costs, including lower margin phases of projects required to support initial deployments, gain new customers or enter new markets; • our level of success in accessing new markets and obtaining new customers; • technology-based price compression and our introduction of new platforms with improved price for performance; • changing market, economic and political conditions, including the impact of tariffs and other trade restrictions; • the financial stability of our customers and suppliers; • consolidation activity among our customers, suppliers and competitors; • the timing of revenue recognition on sales, particularly relating to large orders; • installation service availability and readiness of customer sites; • availability of components and manufacturing capacity; • adverse impact of foreign exchange; and • seasonal effects in our business. |
Generally, competition in our markets is based on any one or a combination of the following factors: • the ability to meet customer business needs and drive successful outcomes; • functionality, speed, capacity, scalability, performance, quality and reliability of solutions; • price for performance, cost per bit and total cost of ownership of solutions; • incumbency and strength of existing business relationships; • ability to offer comprehensive networking solutions, consisting of hardware, software and services; • time-to-market in delivering products and features; • technology roadmap and forward innovation capacity and ability to deliver on network innovation; • company stability and financial health; • flexibility and openness of platforms, including ease of integration, interoperability and integrated management; • ability to offer solutions that accommodate a range of emerging customer consumption models for network solutions; • operating costs, space requirements and power consumption of network solutions; • software and network automation and analytics capabilities; • manufacturing and lead-time capability; and • services and support capabilities. |
Our international sales and operations are subject to inherent risks, including: • adverse social, political and economic conditions in countries outside the United States; • effects of adverse changes in currency exchange rates; • greater difficulty in collecting accounts receivable and longer collection periods; • difficulty and cost of staffing and managing foreign operations; • higher incidence of corruption or unethical business practices; • less protection for intellectual property rights in some countries; • tax and customs changes that adversely impact our global sourcing strategy, manufacturing practices, transfer-pricing, or competitiveness of our products for global sales; • compliance with certain testing, homologation or customization of products to conform to local standards; • significant changes to free trade agreements, trade protection measures, tariffs, export compliance, domestic preference procurement requirements, qualification to transact business and additional regulatory requirements; and • natural disasters, epidemics and acts of war or terrorism. |
The following tables set forth (in thousands) the major components of the increase in working capital: As compared to the end of fiscal 2018: • The $65.7 million of cash provided by accounts receivable during fiscal 2019 reflects increased cash collection; • The $112.9 million of cash used in inventory during fiscal 2019 primarily reflects increases in finished goods to meet customer delivery schedules; • The $96.6 million of cash used in prepaid expenses and other during fiscal 2019 primarily reflects increases in contract assets for unbilled accounts receivable due to changes in revenue recognition for installation services and certain product sales; • The $27.7 million of cash provided by accounts payable, accruals and other obligations during fiscal 2019 primarily reflects higher employee bonus accrual associated with our annual cash incentive compensation plan, partially offset by payout of accrued employee leave in North America in connection with a new paid time off policy; and • The $16.5 million of cash provided by deferred revenue during fiscal 2019 represents an increase in advanced payments received from customers prior to revenue recognition. |
Financial Statements and Supplementary Data The following is an index to the consolidated financial statements: Page Number Report of Independent Registered Public Accounting Firm Consolidated Balance Sheets Consolidated Statements of Operations Consolidated Statements of Comprehensive Income (Loss) Consolidated Statements of Changes in Stockholders’ Equity Consolidated Statements of Cash Flows Notes to Consolidated Financial Statements Report of Independent Registered Public Accounting Firm To the Board of Directors and Stockholders of Ciena Corporation Opinions on the Financial Statements and Internal Control over Financial Reporting We have audited the accompanying consolidated balance sheets of Ciena Corporation and its subsidiaries (the “Company”) as of November 2, 2019 and November 3, 2018, and the related consolidated statements of operations, comprehensive income (loss), changes in stockholders’ equity, and cash flows for each of the three years in the period ended November 2, 2019, including the related notes (collectively referred to as the “consolidated financial statements”). |
The Refinancing Agreement amends Ciena’s credit agreement, dated July 15, 2014, as amended (the “Credit Agreement”) and provides that the 2025 Term Loan will, among other things: • amortize in equal quarterly installments in aggregate amounts equal to 0.25% of the principal amount of the 2025 Term Loan as of September 28, 2018, with the balance payable at maturity; • be subject to mandatory prepayment provisions upon the occurrence of certain specified events substantially similar to the 2022 Term Loan, including certain asset sales, debt issuances and receipt of annual Excess Cash Flow (as defined in the Credit Agreement); • bear interest, at Ciena’s election, at a per annum rate equal to (a) LIBOR (subject to a floor of 0.00%) plus an applicable margin of 2.00%, or (b) a base rate (subject to a floor of 1.00%) plus an applicable margin of 1.00%; and • be repayable at any time at Ciena’s election, provided that repayment of the 2025 Term Loan with proceeds of certain indebtedness prior to March 28, 2019 will require a prepayment premium of 1.00% of the aggregate principal amount of such prepayment. |
Additional factors that contribute to fluctuations in our revenue, gross margin and operating results include: • changes in spending levels or patterns by customers, particularly with respect to our service provider and Web-scale provider customers; • order timing, volume and cancellations; • backlog levels; • the level of competition and pricing pressure in our industry; • the impact of commercial concessions or unfavorable commercial terms required to maintain incumbency or secure new opportunities with key customers; • the mix of revenue by product segment, geography and customer in any particular quarter; • our level of success in achieving targeted cost reductions and improved efficiencies in our supply chain; • the pace and impact of price erosion that we regularly encounter in our markets; • our level of success in executing our strategy of capturing additional market share and displacing competitors; • our incurrence of start-up costs, including lower margin phases of projects required to support initial deployments, gain new customers or enter new markets; • technology-based price compression and the introduction of new platforms with improved price for performance; • changing market, economic and political conditions; • consolidation activity among our customers and suppliers; • the timing of revenue recognition on sales, particularly relating to large orders; • installation service availability and readiness of customer sites; • availability of components and manufacturing capacity; • adverse impact of foreign exchange; and • seasonal effects in our business. |
Our international sales and operations are subject to inherent risks, including: • social, political and economic conditions in countries outside the United States; • effects of adverse changes in currency exchange rates; • greater difficulty in collecting accounts receivable and longer collection periods; • difficulty and cost of staffing and managing foreign operations; • higher incidence of corruption or unethical business practices; • less protection for intellectual property rights in some countries; • tax and customs changes that adversely impact our global sourcing strategy, manufacturing practices, transfer-pricing, or competitiveness of our products for global sales; • compliance with certain testing, homologation or customization of products to conform to local standards; • significant changes to free trade agreements, trade protection measures, tariffs, export compliance, domestic preference procurement requirements, qualification to transact business and additional regulatory requirements; and • natural disasters, epidemics and acts of war or terrorism. |
The following tables set forth (in thousands) the major components of the reduction in working capital: As compared to the end of fiscal 2017: • The $168.4 million of cash used in accounts receivable during fiscal 2018 reflects higher sales volume in the fourth quarter of fiscal 2018 as compared to fiscal 2017; • The $27.4 million in cash used in inventory during fiscal 2018 primarily reflects increases in finished goods to meet customer delivery schedules; • Cash used in prepaid expenses and other during fiscal 2018 was $21.4 million, primarily reflects increased government grant receivables and other non-customer receivables partially offset by lower prepaid value added taxes and lower deferred deployment costs; • The $85.8 million of cash provided by accounts payable, accruals and other obligations during fiscal 2018 reflects increased inventory purchases at the end of fiscal 2018; and • The $19.3 million of cash used in deferred revenue represents a decrease in advanced payments received from customers prior to revenue recognition. |
Financial Statements and Supplementary Data The following is an index to the consolidated financial statements: Page Number Report of Independent Registered Public Accounting Firm Consolidated Balance Sheets Consolidated Statements of Operations Consolidated Statements of Comprehensive Income (Loss) Consolidated Statements of Changes in Stockholders’ Equity (Deficit) Consolidated Statements of Cash Flows Notes to Consolidated Financial Statements Report of Independent Registered Public Accounting Firm To the Board of Directors and Shareholders of Ciena Corporation: Opinions on the Financial Statements and Internal Control over Financial Reporting We have audited the accompanying consolidated balance sheets of Ciena Corporation and its subsidiaries (the “Company”) as of October 31, 2018 and 2017, and the related consolidated statements of operations, comprehensive income (loss), changes in stockholders’ equity (deficit), and cash flows for each of the three years in the period ended October 31, 2018, including the related notes (collectively referred to as the “consolidated financial statements”). |
The Refinancing Agreement amends the Term Loan Credit Agreement (as defined below) and provides that the 2025 Term Loan will, among other things: • amortize in equal quarterly installments in aggregate amounts equal to 0.25% of the principal amount of the Refinancing Term Loan as of September 28, 2018, with the balance payable at maturity; • be subject to mandatory prepayment provisions upon the occurrence of certain specified events substantially similar to the Existing Term Loan, including certain asset sales, debt issuances and receipt of annual Excess Cash Flow (as defined in the Credit Agreement); • bear interest, at Ciena’s election, at a per annum rate equal to (a) LIBOR (subject to a floor of 0.00%) plus an applicable margin of 2.00%, or (b) a base rate (subject to a floor of 1.00%) plus an applicable margin of 1.00%; and • be repayable at any time at Ciena’s election, provided that repayment of the 2025 Term Loan with proceeds of certain indebtedness prior to March 28, 2019 will require a prepayment premium of 1.00% of the aggregate principal amount of such prepayment. |
Additional factors that contribute to fluctuations in our revenue, gross margin and operating results include: • broader macroeconomic conditions, including weakness and volatility in global markets, that affect our customers; • changes in capital spending by customers, in particular our large communications service provider customers; • changes in networking strategies; • order timing, volume and cancellations; • backlog levels; • the level of competition and pricing pressure in our industry; • the impact of commercial concessions or unfavorable commercial terms required to maintain incumbency or secure new opportunities with key customers; • our level of success in achieving cost reductions and improved efficiencies in our supply chain; • the pace and impact of price erosion that we regularly encounter in our markets; • our incurrence of start-up costs, including lower margin phases of projects required to support initial deployments, gain new customers or enter new markets; • the impact of technology-based price compression and the introduction or substitution of new platforms for existing solutions; • the timing of revenue recognition on sales, particularly relating to large orders; • the mix of revenue by product segment, geography and customer in any particular quarter; • installation service availability and readiness of customer sites; • availability of components and manufacturing capacity; • adverse impact of foreign exchange; and • seasonal effects in our business. |
Our international sales and operations are subject to inherent risks, including: • the impact of economic conditions in countries outside the United States; • effects of adverse changes in currency exchange rates; • greater difficulty in collecting accounts receivable and longer collection periods; • difficulty and cost of staffing and managing foreign operations; • higher incidence of corruption or unethical business practices; • less protection for intellectual property rights in some countries; • tax and customs changes that adversely impact our global sourcing strategy, manufacturing practices, transfer-pricing, or competitiveness of our products for global sales; • social, political and economic instability; • compliance with certain testing, homologation or customization of products to conform to local standards; • significant changes to free trade agreements, trade protection measures, tariffs, export compliance, domestic preference procurement requirements, qualification to transact business and additional regulatory requirements; and • natural disasters, epidemics and acts of war or terrorism. |
Financial Statements and Supplementary Data The following is an index to the consolidated financial statements: Page Number Report of Independent Registered Public Accounting Firm Consolidated Balance Sheets Consolidated Statements of Operations Consolidated Statements of Comprehensive Income (Loss) Consolidated Statements of Changes in Stockholders’ Equity (Deficit) Consolidated Statements of Cash Flows Notes to Consolidated Financial Statements Report of Independent Registered Public Accounting Firm To the Board of Directors and Shareholders of Ciena Corporation: In our opinion, the accompanying consolidated balance sheets and the related consolidated statements of operations, comprehensive income (loss), changes in stockholders’ equity (deficit) and cash flows present fairly, in all material respects, the financial position of Ciena Corporation and its subsidiaries (the “Company”) as of October 31, 2017 and 2016, and the results of their operations and their cash flows for each of the three years in the period ended October 31, 2017 in conformity with accounting principles generally accepted in the United States of America. |
Additional factors that contribute to fluctuations in our revenue and operating results include: • broader macroeconomic conditions, including weakness and volatility in global markets, that affect our customers; • changes in capital spending by customers, in particular our large communications service provider customers; • changes in networking strategies; • order timing, volume and cancellations; • backlog levels; • the level of competition and pricing pressure in our industry; • the impact of commercial concessions or unfavorable commercial terms required to maintain incumbency or secure new opportunities with key customers; • our level of success in achieving cost reductions and improved efficiencies in our supply chain; • the pace and impact of price erosion that we regularly encounter in our markets; • our incurrence of start-up costs, including lower margin phases of projects required to support initial deployments, gain new customers or enter new markets; • the timing of revenue recognition on sales, particularly relating to large orders; • the mix of revenue by product segment, geography and customer in any particular quarter; • installation service availability and readiness of customer sites; • availability of components and manufacturing capacity; • adverse impact of foreign exchange; and • seasonal effects in our business. |
Our international sales and operations are subject to inherent risks, including: • the impact of economic conditions in countries outside the United States; • effects of adverse changes in currency exchange rates; • greater difficulty in collecting accounts receivable and longer collection periods; • difficulty and cost of staffing and managing foreign operations; • less protection for intellectual property rights in some countries; • adverse tax and customs consequences, particularly as related to transfer-pricing issues; • social, political and economic instability; • compliance with certain testing, homologation or customization of products to conform to local standards; • higher incidence of corruption or unethical business practices that could expose us to liability or damage our reputation; • significant changes to free trade agreements, trade protection measures, tariffs, export compliance, domestic preference procurement requirements, qualification to transact business and additional regulatory requirements; and • natural disasters, epidemics and acts of war or terrorism. |
Strategic transactions, including our acquisition of Cyan in fiscal 2015 and our acquisition of the high-speed photonics components (“HSPC”) assets from TeraXion in fiscal 2016, can involve numerous additional risks, including: • failure to achieve the anticipated transaction benefits or the projected financial results and operational synergies; • greater than expected acquisition and integration costs; • disruption due to the integration and rationalization of operations, products, technologies and personnel; • diversion of management attention; • difficulty completing projects of the acquired company and costs related to in-process projects; • difficulty managing customer transitions or entering into new markets; • the loss of key employees; • disruption on termination of business relationships with customers, suppliers, vendors, landlords, licensors and other business partners; • ineffective internal controls over financial reporting; • dependence on unfamiliar suppliers or manufacturers; • assumption of or exposure to unanticipated liabilities, including intellectual property infringement or other legal claims; and • adverse tax or accounting impact. |
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