<SEC-DOCUMENT>0001193125-14-437754.txt : 20141209
<SEC-HEADER>0001193125-14-437754.hdr.sgml : 20141209
<ACCEPTANCE-DATETIME>20141209163508
ACCESSION NUMBER:		0001193125-14-437754
CONFORMED SUBMISSION TYPE:	424B5
PUBLIC DOCUMENT COUNT:		4
FILED AS OF DATE:		20141209
DATE AS OF CHANGE:		20141209

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			XOMA Corp
		CENTRAL INDEX KEY:			0000791908
		STANDARD INDUSTRIAL CLASSIFICATION:	PHARMACEUTICAL PREPARATIONS [2834]
		IRS NUMBER:				942756657
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		424B5
		SEC ACT:		1933 Act
		SEC FILE NUMBER:	333-191078
		FILM NUMBER:		141275435

	BUSINESS ADDRESS:	
		STREET 1:		2910 SEVENTH ST
		CITY:			BERKELEY
		STATE:			CA
		ZIP:			94710
		BUSINESS PHONE:		5106441170

	MAIL ADDRESS:	
		STREET 1:		2910 SEVENTH ST
		CITY:			BERKELEY
		STATE:			CA
		ZIP:			94710

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	XOMA LTD /DE/
		DATE OF NAME CHANGE:	19990107

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	XOMA CORP /DE/
		DATE OF NAME CHANGE:	19920703
</SEC-HEADER>
<DOCUMENT>
<TYPE>424B5
<SEQUENCE>1
<FILENAME>d834930d424b5.htm
<DESCRIPTION>424B5
<TEXT>
<HTML><HEAD>
<TITLE>424B5</TITLE>
</HEAD>
 <BODY BGCOLOR="WHITE">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="right"><B>Filed Pursuant to Rule 424(b)(5) <BR> Registration No. 333-191078<BR><BR> </B></P>
<P STYLE="line-height:1.0pt;margin-top:0pt;margin-bottom:0pt;border-bottom:1px solid #000000">&nbsp;</P> <P STYLE="line-height:3.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1px solid #000000">&nbsp;</P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><FONT COLOR="#de1a1e"><B>PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED SEPTEMBER 20, 2013 </B></FONT></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:18pt; font-family:Times New Roman" ALIGN="center"><B>8,097,165 Shares of Common Stock </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:14pt; font-family:Times New Roman" ALIGN="center"><B>Warrants to Purchase 8,097,165 Shares of Common Stock </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<P STYLE="font-size:1pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P> <P STYLE="margin-top:0pt;margin-bottom:0pt" ALIGN="center">


<IMG SRC="g834930suppcov_logo.jpg" ALT="LOGO">
 </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center> <P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We are offering&nbsp;8,097,165&nbsp;shares of our common stock and 8,097,165 warrants to purchase our common stock. The warrants can be
exercised during the period commencing on the date of original issuance and ending on the second anniversary of the date of issuance, at the exercise price of $7.90 per share. The shares of common stock and warrants will be issued separately. The
shares of common stock, warrants and shares of common stock issuable upon exercise of the warrants are sometimes collectively referred to herein as the &#147;securities.&#148; See &#147;Description of Securities We Are Offering&#148; for a more
complete description of the shares and warrants, beginning on page S-34. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Our common stock is listed on The NASDAQ Global Market under the
symbol &#147;XOMA.&#148; The last reported sale price of our common stock on The NASDAQ Global Market on December&nbsp;8, 2014, was $4.95 per share. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We are offering these shares of common stock and warrants to purchase common stock on a best efforts basis to certain institutional investors.
We have retained Cowen and Company, LLC to act as the exclusive placement agent in connection with this offering. </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center>
<P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman"><B>Investing in our common
stock involves a high degree of risk. See the risks set forth under the heading &#147;<A HREF="#suppcov834930_1">Risk Factors</A>&#148; beginning on page S-8 of this prospectus. </B></P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="76%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" ALIGN="center">


<TR>
<TD WIDTH="56%"></TD>
<TD VALIGN="bottom" WIDTH="5%"></TD>
<TD></TD>
<TD></TD>
<TD></TD>
<TD VALIGN="bottom" WIDTH="5%"></TD>
<TD></TD>
<TD></TD>
<TD></TD>
<TD VALIGN="bottom" WIDTH="5%"></TD>
<TD></TD>
<TD></TD>
<TD></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:8pt">
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="2" ALIGN="center" STYLE="border-bottom:1.00pt solid #000000"><B>Offering&nbsp;Price</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="2" ALIGN="center" STYLE="border-bottom:1.00pt solid #000000"><B>Placement<BR>Agent&#146;s&nbsp;Fee&nbsp;(1)</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="2" ALIGN="center" STYLE="border-bottom:1.00pt solid #000000"><B>Proceeds&nbsp;to&nbsp;Us</B></TD>
<TD VALIGN="bottom">&nbsp;</TD></TR>


<TR BGCOLOR="#cceeff" STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">Per Share and Accompanying Warrant</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">$</TD>
<TD VALIGN="bottom" ALIGN="right">4.94</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">$</TD>
<TD VALIGN="bottom" ALIGN="right">0.247</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">$</TD>
<TD VALIGN="bottom" ALIGN="right">4.693</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">Total</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">$</TD>
<TD VALIGN="bottom" ALIGN="right">39,999,995</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">$</TD>
<TD VALIGN="bottom" ALIGN="right">2,000,000</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">$</TD>
<TD VALIGN="bottom" ALIGN="right">37,999,995</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
</TABLE> <P STYLE="line-height:8.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1px solid #000000;width:10%">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%" VALIGN="top" ALIGN="left">(1)</TD>
<TD ALIGN="left" VALIGN="top">We refer you to &#147;Plan of Distribution&#148; beginning on page S-35 of this prospectus supplement for additional information regarding placement agent&#146;s compensation. </TD></TR></TABLE>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Delivery of the securities is expected to be made on or about December&nbsp;12, 2014. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or
determined if this prospectus supplement or the accompanying prospectus is truthful or complete.&nbsp;Any representation to the contrary is a criminal offense. </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center>
<P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><I>Sole
Placement Agent </I></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:16pt; font-family:Times New Roman" ALIGN="center"><B>Cowen and Company </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>The date of this prospectus supplement is December&nbsp;8, 2014. </B></P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P> <P STYLE="line-height:1.0pt;margin-top:0pt;margin-bottom:0pt;border-bottom:1px solid #000000">&nbsp;</P>
<P STYLE="line-height:3.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1px solid #000000">&nbsp;</P>

<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="toc"></A>CONTENTS </B></P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;
</P><DIV STYLE="position:relative;float:left; margin-right:1%; width:48%;padding-right:9pt;padding-bottom:8pt;overflow:hidden;padding-top:3pt">

<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="100%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" ALIGN="center">


<TR>
<TD WIDTH="89%"></TD>
<TD VALIGN="bottom" WIDTH="4%"></TD>
<TD></TD>
<TD></TD>
<TD></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:8pt">
<TD VALIGN="bottom" COLSPAN="4" NOWRAP ALIGN="center" STYLE="border-bottom:1.00pt solid #000000"> <P STYLE="margin-top:0pt; margin-bottom:1pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>Prospectus Supplement</B></P></TD>
<TD VALIGN="bottom">&nbsp;</TD></TR>


<TR STYLE="font-size:1pt">
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="4"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_1">ABOUT THIS PROSPECTUS SUPPLEMENT</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">S-ii</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_2">PROSPECTUS SUPPLEMENT SUMMARY</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">S-1</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_3">RISK FACTORS</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">S-8</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_4">FORWARD-LOOKING INFORMATION</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">S-31</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_5">USE OF PROCEEDS</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">S-32</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_6">DILUTION</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">S-33</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_7">DESCRIPTION OF SECURITIES WE ARE&nbsp;OFFERING</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">S-34</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_8">PLAN OF DISTRIBUTION</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">S-35</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_9">LEGAL MATTERS</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">S-38</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_10">EXPERTS</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">S-38</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_11">WHERE YOU CAN FIND MORE INFORMATION</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">S-38</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_12">INCORPORATION OF DOCUMENTS BY&nbsp;REFERENCE</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">S-38</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="4"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_13">ANNEX A &#150; FORM OF WARRANT</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">A-1</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
</TABLE> </DIV><DIV STYLE="position:relative;float:right; width:48%;padding-right:9pt;padding-bottom:8pt;overflow:hidden;padding-top:3pt">

<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="100%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" ALIGN="center">


<TR>
<TD WIDTH="93%"></TD>
<TD VALIGN="bottom" WIDTH="4%"></TD>
<TD></TD>
<TD></TD>
<TD></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:8pt">
<TD VALIGN="bottom" COLSPAN="4" NOWRAP ALIGN="center" STYLE="border-bottom:1.00pt solid #000000"> <P STYLE="margin-top:0pt; margin-bottom:1pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>Prospectus</B></P></TD>
<TD VALIGN="bottom">&nbsp;</TD></TR>


<TR STYLE="font-size:1pt">
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="4"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_14">ABOUT THIS PROSPECTUS</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">i</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_15">SUMMARY</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">1</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_16">THE SECURITIES WE MAY OFFER</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">2</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_17">RISK FACTORS</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">5</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_18">FORWARD-LOOKING STATEMENTS</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">5</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_19">FINANCIAL RATIOS</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">6</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_20">USE OF PROCEEDS</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">6</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="4"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_21">DESCRIPTION OF CAPITAL STOCK</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">6</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_22">DESCRIPTION OF DEBT SECURITIES</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">11</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_23">DESCRIPTION OF WARRANTS</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">17</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="4"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_24">LEGAL OWNERSHIP OF SECURITIES</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">19</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="4"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_25">PLAN OF DISTRIBUTION</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">23</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_26">LEGAL MATTERS</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">25</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_27">EXPERTS</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">25</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_28">WHERE YOU CAN FIND MORE INFORMATION</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">25</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#supptoc834930_29">INCORPORATION OF CERTAIN INFORMATION BY&nbsp;REFERENCE</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">25</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
</TABLE> </DIV><div style="clear:both; height:0pt; font-size:0pt">&nbsp;</div>
 <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center>
<P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">You should rely
only on the information incorporated by reference or provided in this prospectus supplement, the accompanying prospectus and any free writing prospectus that we have authorized for use in connection with this offering. Neither we nor the placement
agent has authorized anyone to provide you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. This prospectus supplement and the accompanying prospectus do not constitute an
offer to sell, or a solicitation of an offer to purchase, the securities offered by this prospectus supplement and the accompanying prospectus in any jurisdiction where it is unlawful to make such offer or solicitation. You should assume that the
information contained in this prospectus supplement or the accompanying prospectus, or any document incorporated by reference in this prospectus supplement or the accompanying prospectus, and any free writing prospectus that we have authorized for
use in connection with this offering is accurate only as of the date of those respective documents.&nbsp;Neither the delivery of this prospectus supplement nor any distribution of securities pursuant to this prospectus supplement shall, under any
circumstances, create any implication that there has been no change in the information set forth or incorporated by reference into this prospectus supplement or in our affairs since the date of this prospectus supplement. Our business, financial
condition, results of operations and prospects may have changed since that date. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-i </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="supptoc834930_1"></A>ABOUT THIS PROSPECTUS SUPPLEMENT </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">This prospectus supplement is part of a registration statement (No. 333-191078) that we filed with the Securities and Exchange Commission, or
the SEC, using a &#147;shelf&#148; registration process. Under the registration statement, we registered the offering by us of common stock, preferred stock, debt securities and warrants for sale from time to time in one or more offerings. This
prospectus supplement provides specific information about the offering by us of our common stock under the shelf registration statement. This document is in two parts. The first part is the prospectus supplement, which adds to and updates
information contained in the accompanying prospectus. The second part, the prospectus, provides more general information, some of which may not apply to this offering. Generally, when we refer to this prospectus, we are referring to both parts of
this document combined. To the extent there is a conflict between the information contained in this prospectus supplement, on the one hand, and the information contained in the accompanying prospectus, on the other hand, you should rely on the
information in this prospectus supplement. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Before purchasing any securities, you should carefully read both this prospectus supplement
and the accompanying prospectus, together with the documents incorporated by reference herein as described under the heading &#147;Incorporation of Documents By Reference&#148; and the additional information described under the heading, &#147;Where
You Can Find More Information&#148; in this prospectus supplement, as well as any free writing prospectus prepared by or on behalf of us or to which we have referred you. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Unless the context otherwise requires, references in this prospectus supplement to &#147;we&#148;, &#147;us&#148; and &#147;our&#148; refer to
XOMA Corporation and its consolidated subsidiaries. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">This prospectus supplement and the accompanying prospectus, including the information
incorporated by reference into this prospectus supplement and the accompanying prospectus, include trademarks, service marks and trade names owned by us or others. XOMA, the XOMA logo and all other XOMA product and service names are registered or
unregistered trademarks of XOMA Corporation or a subsidiary of XOMA Corporation in the United States and in other selected countries. EYEGUARD is a service mark of a subsidiary of XOMA Corporation in the United States.&nbsp;All other trademarks,
service marks and trade names included or incorporated by reference in this prospectus supplement and the accompanying prospectus are the property of their respective owners. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-ii </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>


<div style ="BORDER-BOTTOM:1.00pt solid #000000;BORDER-LEFT:1.00pt solid #000000;BORDER-RIGHT:1.00pt solid #000000;BORDER-TOP:1.00pt solid #000000;MARGIN-LEFT:0px;MARGIN-RIGHT:0px;WIDTH:100%"><div style="width:97%; margin-top:1.5%; margin-left:1.5%; margin-right:-1.25%">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="supptoc834930_2"></A>PROSPECTUS SUPPLEMENT SUMMARY </B></P>
<P STYLE="margin-top:10pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><I>This summary highlights selected information about our company, this offering and information appearing elsewhere in this prospectus
supplement, in the accompanying prospectus, in the documents we incorporate by reference and in any free writing prospectus that we have authorized for use in connection with this offering. This summary is not complete and does not contain all the
information that you should consider before investing in our common stock. You should read this entire prospectus supplement and the accompanying prospectus carefully, including the &#147;Risk Factors&#148; contained in this prospectus supplement
beginning on page S-8 of this prospectus supplement, the accompanying prospectus and the financial documents and notes incorporated by reference in this prospectus supplement and the accompanying prospectus and any free writing prospectus that we
have authorized for use in connection with this offering, before making an investment decision. This prospectus supplement may add to, update or change information in the accompanying prospectus. </I></P>
<P STYLE="margin-top:16pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Overview </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">XOMA Corporation
(&#147;XOMA&#148;), a Delaware corporation, discovers and develops innovative antibody-based therapeutics. We specialize in the discovery and development of innovative antibody-based therapeutics. Our antibodies have unique properties due to their
interaction at target protein sites that are called &#147;allosteric&#148; because they are not within the core area of target action. This allows up- or down-modulation of the protein&#146;s target activity as desired and may impart a selectivity
or safety advantage against certain targets compared to more traditional modes of action. </P> <P STYLE="margin-top:10pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Our lead drug candidate, gevokizumab, is a
proprietary potent, humanized allosteric-modulating monoclonal antibody that binds to the inflammatory cytokine interleukin-1 beta (&#147;IL-1 beta&#148;). We believe that by targeting IL-1 beta, gevokizumab has the potential to address the
underlying inflammatory causes of a wide range of diseases that have been identified as having unmet medical needs. </P> <P STYLE="margin-top:10pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Together with our
development partner, Les Laboratoires Servier (&#147;Servier&#148;), a leading independent French pharmaceutical company, we have initiated four Phase 3 clinical trials evaluating gevokizumab for the treatment of non-infectious intermediate,
posterior or pan-uveitis (&#147;NIU&#148;) and Beh&ccedil;et&#146;s disease uveitis, a severe subset of NIU. We are responsible for all of the clinical study sites in the United States, and Servier is responsible for all of the clinical study sites
outside of the United States. These studies are known as the EYEGUARD&#153; program, which includes EYEGUARD-A (patients with active NIU), EYEGUARD-B (patients with Beh&ccedil;et&#146;s disease uveitis), EYEGUARD-C (patients currently controlled
with systemic treatment), and EYEGUARD-US (a study in patients with Beh&ccedil;et&#146;s disease uveitis being conducted at study centers in the United States). </P>
<P STYLE="margin-top:10pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Our strategy is to pursue Beh&ccedil;et&#146;s disease uveitis as our first indication for gevokizumab in the United States. Upon the
successful completion of SERVIER&#146;s EYEGUARD-B study, we intend to meet with the U.S. Food and Drug Administration (&#147;FDA&#148;) to review the Phase 3 EYEGUARD-B data together with the data from the two Beh&ccedil;et&#146;s disease uveitis
Phase 2 studies conducted independently by XOMA and Servier. We believe the seriousness of this disease and the small patient population warrant consideration for approval based upon positive data from a single pivotal study. There is significant
precedence for regulatory approval based upon a single study for indications of similar seriousness in patient populations. Should EYEGUARD-B successfully demonstrate patients with Beh&ccedil;et&#146;s disease uveitis receiving gevokizumab took
longer to exacerbate than the placebo-treated patients during the tapering of administered steroids, we believe we will be in position to begin the Biologics License Application (&#147;BLA&#148;) submission process. </P>
<P STYLE="margin-top:10pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In September 2014, we opened the EYEGUARD-US supplemental clinical study to patients at study sites located in the United States to assess the
efficacy and safety of gevokizumab in treating Beh&ccedil;et&#146;s disease uveitis. The supplemental EYEGUARD-US study may be used in one of several ways. It may not be required for the initial BLA submission so that it merely provides further
information as to U.S. physicians&#146; and patients&#146; experiences with gevokizumab. It may be required for the FDA&#146;s review of our submission but for informational purposes without being considered a pivotal study. In this case, the study
would be unmasked at a predetermined time when we are in a position to submit the BLA. Finally, it may be required as a second pivotal study in order for FDA to accept our submission. We&#146;ve designed the EYEGUARD-US study to fulfill whatever
directive we are given by the Agency. We are prepared to respond as quickly as possible to any of the anticipated outcomes from our pre-BLA meeting. </P>
 <P STYLE="margin-top:0pt;margin-bottom:0pt; font-size:8pt">&nbsp;</P></div></div>

 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-1 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>


<div style ="BORDER-BOTTOM:1.00pt solid #000000;BORDER-LEFT:1.00pt solid #000000;BORDER-RIGHT:1.00pt solid #000000;BORDER-TOP:1.00pt solid #000000;MARGIN-LEFT:0px;MARGIN-RIGHT:0px;WIDTH:100%"><div style="width:97%; margin-top:1.5%; margin-left:1.5%; margin-right:-1.25%">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In addition to the NIU clinical trials, we are studying gevokizumab in pyoderma gangrenosum
(&#147;PG&#148;), a rare ulcerative skin disease that is a specific indication under the umbrella of diseases known as neutrophilic dermatosis. Patients experience painful expanding skin ulcers that have a significant impact on their quality of
life. Approximately 50 to 70 percent of the PG patient population has an underlying systemic condition, while the remainder is idiopathic (unknown cause). The most prevalent underlying conditions are ulcerative colitis and Crohn&#146;s disease. The
prognosis for PG is directly linked to the patient&#146;s response to therapy for the underlying disease. Physicians treat patients with systemic therapies that are approved for the underlying disease and topical therapies applied directly to the
ulcers, yet published literature suggests current therapies can take six months to stop the ulcers from expanding and over eleven months to heal. Despite the ongoing use of systemic therapy, up to 46 percent of patients experience a relapse. The
U.S. Department of Health and Human Services&#146; National Institutes of Health&#146;s Office of Rare Disease Research lists PG occurring in about one per 100,000 people. Claims data compiled over the past three years indicate the number of
diagnosed PG patients in the U.S. ranges between 11,000 and 14,000 annually. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Based upon what we believe are compelling data from our
pilot study in patients with PG, we requested and in March 2014 held a meeting with the FDA to solicit feedback on our proposed Phase 3 clinical development program. Final comments from the FDA were received in the third quarter of 2014. The Phase 3
program includes two double-blind, placebo-controlled clinical studies, each of which is designed to enroll 58 patients with active PG to receive gevokizumab 60 mg or placebo dosed subcutaneously once monthly, in addition to their current treatment
regimen of low-dose corticosteroids and/or immunosuppressants. The primary endpoint is the complete closure of the PG target ulcer determined at Day 126 and confirmation of complete closure a minimum of two weeks later on or after Day 140. In
October 2014, we opened the first of two pivotal Phase 3 gevokizumab studies in PG. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We also have an active gevokizumab Proof-of-Concept
(&#147;POC&#148;) development program to identify other illnesses for late-stage development. We have conducted POC trials in moderate-to-severe inflammatory acne and in erosive osteoarthritis of the hand (&#147;EOA&#148;), and we have several other
ongoing POC studies. We have decided not to further pursue the acne indication. These EOA results led to our decision not to pursue Phase 3 testing in the broad EOA population, although we continue to review the data to determine if there is a
subgroup of the EOA population that could benefit from gevokizumab therapy. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Gevokizumab has been generally well tolerated across all of
our clinical studies. In both the acne and EOA studies, there were no drug-related serious adverse events reported. The most common adverse events were headache, pain, arthralgia, urinary tract infections, upper respiratory tract infections and
pneumonia, and they were comparable between gevokizumab and placebo. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We also have ongoing clinical studies assessing gevokizumab&#146;s
potential to treat several other rare diseases. Two studies are being conducted in collaboration with the U.S. National Institutes of Health (&#147;NIH&#148;). The National Eye Institute is conducting a gevokizumab study in patients with
non-infectious anterior scleritis. The North Shore-Long Island Jewish Health System in collaboration with the National Institute on Deafness and Other Communication Disorders are conducting a gevokizumab clinical study in patients with inflammatory
autoimmune inner ear disease. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Separately, Servier instituted its own active development program for gevokizumab beyond the NIU and
Beh&ccedil;et&#146;s uveitis Phase 3 program. In 2012, Servier initiated a gevokizumab Phase 2 study in patients with acute coronary syndrome, a cardiovascular disease. In 2013, Servier also began testing gevokizumab in a variety of POC studies,
including polymyositis/dermatomyositis, Schnitzler syndrome, and giant cell arteritis. Servier has indicated these are the first studies in an extensive multi-indication exploratory program it expects to conduct. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Our proprietary pipeline includes classes of allosteric modulating antibodies that activate, sensitize or deactivate the insulin receptor in
vivo, which we have named XMet. Insulin is the major hormone for lowering blood glucose levels. Abnormal increases in insulin secretion can lead to profound hypoglycemia (low blood sugar), a state that may result in significant morbidities including
cerebral damage and epilepsy. In some instances, profound hypoglycemia can result in fatality. There are three programs in the XMet portfolio, XMetD, which is designed to </P>
 <P STYLE="margin-top:0pt;margin-bottom:0pt; font-size:8pt">&nbsp;</P></div></div>

 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-2 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>


<div style ="BORDER-BOTTOM:1.00pt solid #000000;BORDER-LEFT:1.00pt solid #000000;BORDER-RIGHT:1.00pt solid #000000;BORDER-TOP:1.00pt solid #000000;MARGIN-LEFT:0px;MARGIN-RIGHT:0px;WIDTH:100%"><div style="width:97%; margin-top:1.5%; margin-left:1.5%; margin-right:-1.25%">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
deactivate the insulin receptor, XMetA, which is designed to activate the insulin receptor, and XMetS, which is designed to sensitize the insulin receptor when in an insulin resistant state.
These programs are highly novel as the antibodies bind to different sites on the insulin receptor than currently marketed drugs. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The lead
compound from XOMA&#146;s XMetD program, XOMA 358 is a fully human monoclonal allosteric modulating antibody that binds to insulin receptors and attenuates insulin action. It is designed to negatively modulate the insulin receptor and its downstream
signaling capabilities. We launched clinical development activities for XOMA 358 in October 2014, with the first patient dosed in our Phase 1 safety and tolerability study. We intend to investigate this compound as a novel treatment for
non-drug-induced, endogenous hyperinsulinemic hypoglycemia (low blood glucose caused by excessive insulin produced by the body). A therapy that safely and effectively mitigates insulin-induced hypoglycemia has the potential to address a significant
unmet therapeutic need for certain rare medical conditions associated with hyperinsulinism. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We intend to retain full ownership of the
compounds in XMetD, as it aligns with our focus to develop products for diseases with significant unmet medical need and treated by the specialist prescriber. We intend to license XMetA and XMetS to a pharmaceutical company with expertise in
developing and commercializing compounds for Types 1 and 2 diabetes. This portfolio of antibodies represents potential new therapeutic approaches to the treatment of diabetes and several rare diseases that have insulin involvement. </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Corporate Strategy </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We are committed to
establishing XOMA as a commercial organization in the United States to ensure we capture the value from our product discovery and development programs.&nbsp;Our commercialization strategy is to market our products in the United States through our
own focused sales teams calling on the specialist prescriber.&nbsp;For indications that will require clinical studies that are prohibitively large or the targeted patient populations are not treated by the specialist provider, we will seek a
development and commercialization partner.&nbsp;For gevokizumab, we select our clinical development indications based upon data that supports IL-1 beta&#146;s role in the disease state and upon data indicating the affected patients are treated by a
specialized physician base.&nbsp;Additionally, we may seek to expand our pipeline by developing additional proprietary products and technologies and by entering into additional licensing and collaborative arrangements with pharmaceutical and
biotechnology companies.&nbsp;The principal elements of our corporate strategy are to: </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="1%">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"><B><I>Complete Phase 3 clinical trial for gevokizumab in Beh&ccedil;et&#146;s disease uveitis.</I></B> To accelerate our path to commercialization, we will seek guidance from&nbsp;the FDA to determine the requirements
necessary to support&nbsp;a Biologics License Application (&#147;BLA&#148;) in Beh&ccedil;et&#146;s disease uveitis upon the receipt of successful primary endpoint data from the EYEGUARD-B study.&nbsp;We believe positive EYEGUARD-B results, combined
with the results obtained by Servier and our independent Phase 2 studies are compelling for the submission of a BLA for Beh&ccedil;et&#146;s disease uveitis.&nbsp;The FDA may require us to conduct a confirmatory study in patients with
Beh&ccedil;et&#146;s disease uveitis to support a BLA filing in this indication; therefore we initiated the EYEGUARD-US study.&nbsp;Depending upon the FDA&#146;s feedback regarding what data is required to support a BLA filing for
Beh&ccedil;et&#146;s disease uveitis, we&nbsp;hope to be able to file the application shortly after our pre-BLA meeting. </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="1%">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE="font-family:Times New Roman; font-size:10pt">Complete Phase 3 clinical development for gevokizumab, our lead product candidate, in non-infectious uveitis and Beh&ccedil;et&#146;s disease
uveitis.&nbsp;With Servier, we launched the global gevokizumab Phase 3 clinical development program, named EYEGUARD&#153;, in 2012.&nbsp;The global program includes two Phase 3 trials in active and controlled NIU involving the intermediate and/or
posterior segments of the eye (EYEGUARD-A and EYEGUARD-C, respectively) and a Phase 3 trial outside the United States in a subset of NIU patients who suffer from Beh&ccedil;et&#146;s disease uveitis (EYEGUARD-B).&nbsp;The EYEGUARD-A study defines
active NIU as a vitreous haze score of equal to or greater than two on the SUN/NEI scale.&nbsp;The vitreous is a normally transparent gel that fills the eyeball behind the lens, and vitreous haze is the clouding of that gel.&nbsp;The EYEGUARD-C
study is designed to determine if physicians can reduce or eliminate corticosteroid use from NIU patients without causing their disease to flare, or exacerbate.&nbsp;EYEGUARD-A and -C are ongoing and continue to enroll patients. The EYEGUARD-B study
is designed to determine if physicians can reduce or eliminate corticosteroid use from Beh&ccedil;et&#146;s patients without causing an acute exacerbation of their uveitis.&nbsp;In </P></TD></TR></TABLE>
 <P STYLE="margin-top:0pt;margin-bottom:0pt; font-size:8pt">&nbsp;</P></div></div>

 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-3 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>


<div style ="BORDER-BOTTOM:1.00pt solid #000000;BORDER-LEFT:1.00pt solid #000000;BORDER-RIGHT:1.00pt solid #000000;BORDER-TOP:1.00pt solid #000000;MARGIN-LEFT:0px;MARGIN-RIGHT:0px;WIDTH:100%"><div style="width:97%; margin-top:1.5%; margin-left:1.5%; margin-right:-1.25%">


<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD VALIGN="top"> <P STYLE="font-family:Times New Roman; font-size:10pt">
addition to establishing efficacy, we believe&nbsp;these trials have been designed to provide&nbsp;data necessary to meet&nbsp;the FDA minimum requirements for demonstrating&nbsp;safety for
ophthalmic indications: at least 300 patients must be treated for at least six months and 100 patients for one year at the to-be-marketed dose. </P></TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="1%">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"><B><I>Advance a Phase 3 program in PG, a rare disease classified under the broader indication of neutrophilic dermatoses</I></B><I>.</I> In 2013, we launched a pilot study to determine gevokizumab&#146;s ability to
treat acute inflammatory PG, one of several rare diseases classified under the broader cluster of neutrophilic dermatoses.&nbsp;We designed the study to enroll as many as four patients to receive gevokizumab 60 mg, dosed once monthly for three
months.&nbsp;After this cohort had completed one dose, we reviewed the data and elected not to proceed to a higher dosing regimen, as the patients were responding to gevokizumab.&nbsp;Three patients showed improvement in ulcer size by Day
28.&nbsp;One patient had total resolution of the ulcer by Day 84; a second patient had 93% improvement in ulcer size by Day 56.&nbsp;Two additional patients have been enrolled in the pilot program.&nbsp;We launched the first of two Phase 3 clinical
trials in November 2014 and are in the process of completing the regulatory filings and clinical site identification to initiate the second study. </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="1%">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"><B><I>Continue to assess gevokizumab&#146;s ability to treat a variety of rare diseases</I></B>. In April 2013, the NEI, one of the NIH, opened its non-infectious, active, anterior scleritis trial for patient
enrollment. The open-label single-arm Phase&nbsp;1/2 study is designed to assess the safety and potential efficacy of gevokizumab in 10 patients experiencing non-infectious, active, anterior scleritis, which is the inflammation of the sclera (the
fibrous white membrane surrounding the eyeball excluding the cornea). </TD></TR></TABLE> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; font-size:10pt; font-family:Times New Roman">In August 2013, we announced a single-center clinical
trial in ten patients with AIED, which falls under the umbrella of sensorineural hearing loss.&nbsp;Patients with AIED usually experience multiple episodes of rapid hearing loss either concurrently or sequentially in both ears.&nbsp;This study will
be run by Feinstein Institute for Medical Research, Hearing&nbsp;&amp; Speech Center at North Shore-Long Island Jewish Health System in collaboration with, and with funding from, the National Institute on Deafness and Other Communication Disorders
and the NIH. </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="1%">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"><B><I>Establish commercial-scale manufacturing for gevokizumab</I></B>.&nbsp;In August 2012, we and Servier announced we had entered into an agreement with Boehringer Ingelheim to transfer XOMA&#146;s technology and
processes for the validation of our technology and processes in preparation for the commercial manufacture of gevokizumab.&nbsp;Upon the successful completion of the transfer and the establishment of biological comparability, including validation of
the XOMA processes, it is our intention that Boehringer Ingelheim will produce gevokizumab for XOMA&#146;s commercial use at its facility in Biberach, Germany. </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="1%">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"><B><I>Advance our proprietary preclinical pipeline candidates and generate revenues from our proprietary technologies.</I></B> We continue to develop our proprietary preclinical pipeline, primarily focusing on the
development of allosteric modulating monoclonal antibodies.&nbsp;Our most advanced program, which targets the insulin receptor, has generated three new classes of fully human monoclonal antibodies.&nbsp;These allosteric modulating antibodies
activate (XMet A) or sensitize (XMet S) or antagonize/deactivate (XMet D) the insulin receptor in vivo.&nbsp;XMet A and XMet S represent the potential for distinct, new therapeutic approaches for the treatment of patients with
diabetes.&nbsp;Separate studies of XMet A and XMet S have demonstrated reduced fasting blood glucose levels and improved glucose tolerance in mouse models of diabetes.&nbsp;We are seeking collaborative partners to conduct development and
commercialization activities for both XMet A and XMet S. </TD></TR></TABLE> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; font-size:10pt; font-family:Times New Roman">In the case of XOMA-358 (formerly XMet D), a fully human,
allosteric, monoclonal antibody to deactivate the insulin receptor, we plan to develop this compound internally, as it has potential as a treatment for as many as three ultra-rare life-threatening or severely debilitating diseases: insulinomas,
congenital hyperinsulinism (&#147;CHI&#148;), and hyperinsulinemic hypoglycemia in post-gastric bypass surgery patients.&nbsp;In preclinical models, XOMA-247 has emulated the glucose lowering seen in patients with insulinomas, a beta cell tumor that
over secretes insulin, and with CHI, a hereditary disease resulting in lack of insulin regulation and profound hypoglycemia that can result in seizures and brain damage.&nbsp;These models demonstrated XOMA-247 was capable of restoring fasting blood
glucose to normal levels.&nbsp;We launched clinical development for XOMA-358 in October 2014 and ultimately hope to pursue the compound for use in patients with endogenous hypoglycemia. </P>
 <P STYLE="margin-top:0pt;margin-bottom:0pt; font-size:8pt">&nbsp;</P></div></div>

 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-4 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>


<div style ="BORDER-BOTTOM:1.00pt solid #000000;BORDER-LEFT:1.00pt solid #000000;BORDER-RIGHT:1.00pt solid #000000;BORDER-TOP:1.00pt solid #000000;MARGIN-LEFT:0px;MARGIN-RIGHT:0px;WIDTH:100%"><div style="width:97%; margin-top:1.5%; margin-left:1.5%; margin-right:-1.25%">


<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="1%">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"><B><I>Complete current biodefense contracts.</I></B> To date, we have been awarded four contracts, totaling approximately $120 million, from NIAID to support development of XOMA 3AB and several additional product
candidates for the treatment of botulism poisoning with botulinum toxin serotype A, B and E, as well as C and D.&nbsp;In addition, our biodefense programs included two subcontracts from SRI International totaling $4.3 million, funded through NIAID,
for the development of antibodies to neutralize H1N1 and H5N1 influenza viruses and the virus that causes severe acute respiratory syndrome (&#147;SARS&#148;). </TD></TR></TABLE>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; font-size:10pt; font-family:Times New Roman">NIAID has completed a Phase 1 trial of XOMA 3AB, a novel formulation of three antibodies designed to prevent and treat botulism poisoning from
serotype A.&nbsp;This double-blind, dose-escalation study in 24 healthy volunteers was designed to assess the safety and tolerability and determine the pharmacokinetic profile of XOMA 3AB.&nbsp;This trial has been completed, and no drug product
related Serious Adverse Events have been observed.&nbsp;The results of this trial strongly support our platform approach for the remaining serotype directed anti-toxins. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; font-size:10pt; font-family:Times New Roman">In 2012, we announced we will complete NIAID biodefense contracts currently in place but will not actively pursue future contracts.&nbsp;Should
the government choose to acquire XOMA 3AB or other biodefense products in the future, we expect to be able to provide these antibodies through an outside manufacturer. </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Company Information </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We were incorporated
in Delaware in 1981 and became a Bermuda exempted company in December 1998. Effective December&nbsp;31, 2011, we changed our jurisdiction of incorporation from Bermuda to Delaware and changed our name from XOMA Ltd. to XOMA Corporation. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Our principal executive offices are located at 2910 Seventh Street, Berkeley, California 94710, and we maintain a registered office located at
Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801. Our telephone number at our principal executive offices is (510)&nbsp;204-7200. Our website address is www.xoma.com. Information found on, or accessible through, our website
is not a part of, and is not incorporated into, this prospectus, and you should not consider it part of this prospectus or part of any prospectus supplement. Our website address is included in this document as an inactive textual reference only.
</P>
 <P STYLE="margin-top:0pt;margin-bottom:0pt; font-size:8pt">&nbsp;</P></div></div>

 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-5 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>


<div style ="BORDER-BOTTOM:1.00pt solid #000000;BORDER-LEFT:1.00pt solid #000000;BORDER-RIGHT:1.00pt solid #000000;BORDER-TOP:1.00pt solid #000000;MARGIN-LEFT:0px;MARGIN-RIGHT:0px;WIDTH:100%"><div style="width:97%; margin-top:1.5%; margin-left:1.5%; margin-right:-1.25%">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>THE OFFERING </B></P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="100%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" ALIGN="center">


<TR>
<TD WIDTH="50%"></TD>
<TD VALIGN="bottom" WIDTH="1%"></TD>
<TD WIDTH="48%"></TD></TR>


<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Common stock we are offering</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">8,097,165 shares</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Warrants we are offering</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">Warrants to purchase up to 8,097,165 shares of common stock (a warrant to purchase one share of our common stock for each share of our common stock purchased). The warrants will be exercisable during the period commencing on the
date of original issuance and ending two years from such issuance date at an exercise price of $7.90 per share of common stock. This prospectus supplement also relates to the offering of the shares of common stock issuable upon exercise of the
warrants.</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Common stock to be issued and outstanding after the offering</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">115,471,127 shares</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Listing</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">Our common stock is listed on The NASDAQ Global Market under the symbol &#147;XOMA.&#148; There is no established public trading market for the warrants, and we do not expect a market to develop. In addition, we do not intend to
apply for listing of the warrants on any national securities exchange or other nationally recognized trading system.</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Use of proceeds</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">We currently intend to use the net proceeds from this offering for continued development, preclinical testing and clinical studies related to gevokizumab and our XMet platform. We intend to use the remainder of the net proceeds for
general research and development, business development and other corporate purposes as determined by our management. See &#147;Use of Proceeds&#148; on page S-32 of this prospectus supplement.</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Risk factors</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">You should carefully consider the information in &#147;Risk Factors&#148; beginning on page S-8 of this prospectus supplement for a discussion of factors you should consider carefully when making a decision to invest in our
securities.</TD></TR>
</TABLE> <P STYLE="line-height:8.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1px solid #000000;width:10%">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The number
of shares of our common stock that will be issued and outstanding immediately after this offering as shown above is based on 107,373,962 shares of common stock issued and outstanding as of September&nbsp;30, 2014, and excludes 8,097,165 shares
issuable upon the exercise of the warrants offered hereby and also excludes the following: </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">shares of common stock issuable upon the exercise of stock options outstanding, of which there were 7,784,141 outstanding as of September&nbsp;30, 2014, with a weighted average exercise price of $8.13 per share;
</TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">shares of common stock issuable upon the vesting of outstanding restricted stock units, of which there were 2,661,846 outstanding as of September&nbsp;30, 2014; </TD></TR></TABLE>
 <P STYLE="margin-top:0pt;margin-bottom:0pt; font-size:8pt">&nbsp;</P></div></div>

 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-6 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>


<div style ="BORDER-BOTTOM:1.00pt solid #000000;BORDER-LEFT:1.00pt solid #000000;BORDER-RIGHT:1.00pt solid #000000;BORDER-TOP:1.00pt solid #000000;MARGIN-LEFT:0px;MARGIN-RIGHT:0px;WIDTH:100%"><div style="width:97%; margin-top:1.5%; margin-left:1.5%; margin-right:-1.25%">


<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">shares of common stock issuable upon the exercise of our outstanding warrants, of which outstanding as of September&nbsp;30, 2014, there were warrants to purchase 347,826 shares of common stock at an exercise price of
$19.50 per share, 1,260,000 shares of common stock at an exercise price of $10.50 per share, 39,346 shares of common stock at an exercise price of $3.54 per share, 12,109,418 shares of common stock at an exercise price of $1.76 per share, and
263,158 shares of common stock at an exercise price of $1.14 per share; and </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">6,193,109 shares of common stock not subject to stock awards and reserved for issuance under our equity incentive plans and 56,191 shares of common stock reserved for issuance under our employee stock purchase plan.
</TD></TR></TABLE>
 <P STYLE="margin-top:0pt;margin-bottom:0pt; font-size:8pt">&nbsp;</P></div></div>

 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-7 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="suppcov834930_1"></A><A NAME="supptoc834930_3"></A>RISK FACTORS </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><I>Any investment in our securities involves a high degree of risk, including the risks described below.&nbsp;Before purchasing our common
stock and warrants, you should carefully consider the risk factors set forth below, as well as all other information contained in this prospectus supplement and the accompanying prospectus and incorporated by reference, including our consolidated
financial statements and the related notes and the additional risk factors contained in our most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q, as well as any amendments thereto, as filed with the SEC, and any free writing
prospectus that we have authorized for use in connection with this offering, before deciding whether to invest in our common stock.&nbsp;The risks and uncertainties described below are not the only risks and uncertainties we face.&nbsp;Additional
risks and uncertainties not presently known to us or that we currently deem immaterial may also impair our business operations.&nbsp;If any of the following risks actually occur, our business, financial condition and results of operations could
suffer.&nbsp;As a result, the trading price of our stock could decline, perhaps significantly, and you could lose all or part of your investment.&nbsp;The risks discussed below also include forward-looking statements and our actual results may
differ substantially from those discussed in these forward-looking statements.&nbsp;See the section entitled &#147;Forward-Looking Information.&#148; </I></P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Risks Relating to our Business </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B><I>Because our product candidates are still being developed, we will require substantial funds to continue; we cannot be certain that funds
will be available, and if they are not available, we may be forced to delay, reduce, or eliminate our product development programs or to take actions that could adversely affect your investment and may not be able to continue operations.
</I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We will need to commit substantial funds to continue development of our product candidates, and we may not be able to obtain
sufficient funds on acceptable terms, or at all. If we raise additional funds by issuing equity securities, our stockholders will experience dilution. Any debt financing or additional equity that we raise may contain terms that are not favorable to
our stockholders or us. If we raise additional funds through collaboration and licensing arrangements with third parties, we may be required to relinquish some rights to our technologies or our product candidates, grant licenses on terms that are
not favorable to us or enter into a collaboration arrangement for a product candidate at an earlier stage of development or for a lesser amount than we might otherwise choose. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Additional funds may not be available when we need them on terms that are acceptable to us, or at all. If adequate funds are not available on
a timely basis, we may: </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">terminate or delay clinical trials for one or more of our product candidates; </TD></TR></TABLE> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; font-size:10pt; font-family:Times New Roman">reduce or
eliminate certain product development efforts or commercialization efforts; </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">further reduce our headcount and capital or operating expenditures; or </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">curtail our spending on protecting our intellectual property. </TD></TR></TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We finance our operations
primarily through our multiple revenue streams resulting from discovery and development collaborations, biodefense contracts, the licensing of our antibody technologies, and through sales of our common stock. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Based on our cash, cash equivalents and short-term investments of $59.1 million at September&nbsp;30, 2014, anticipated spending levels,
anticipated cash inflows from collaborations, biodefense contracts and licensing transactions, funding availability included under our loan agreements, the proceeds from our equity offerings and other sources of funding that we believe to be
available, we believe we have sufficient cash resources to meet our anticipated net cash needs for the next twelve months. Any significant revenue shortfalls, increases in planned spending on development programs, more rapid progress of development
programs than anticipated, or the initiation of new clinical trials, as well as the unavailability of anticipated sources of funding, could shorten this period or otherwise have a material adverse impact on our ability to finance our continued
operations. Progress or setbacks by potentially competing products also may affect our ability to raise new funding on acceptable terms. We do not know when or whether: </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">operations will generate meaningful funds; </TD></TR></TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-8 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>


<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">additional agreements for product development funding can be reached; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">strategic alliances can be negotiated; or </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">adequate additional financing will be available for us to finance our own development on acceptable terms, or at all. </TD></TR></TABLE>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">If adequate funds are not available, we will be required to delay, reduce the scope of, or eliminate one or more of our product development
programs and further reduce personnel-related costs. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>We have sustained losses in the past, and we expect to sustain losses in the future.
</I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We have been and are developing numerous product candidates, and as a result have experienced significant losses. As of
September&nbsp;30, 2014, we had an accumulated deficit of $1,112.2 million. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">For the three and nine months ended September&nbsp;30, 2014,
we had net losses of approximately $14.4 million, or $0.13 per basic share of common stock and $0.17 per diluted share of common stock and $31.0 million, or $0.29 per basic share of common stock and $0.55 per diluted share of common stock. For the
three and nine months ended September&nbsp;30, 2013, we had net losses of approximately $29.6 million, or $0.34 per share of common stock (basic and diluted) and $71.8 million, or $0.85 per share of common stock (basic and diluted), respectively.
</P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Our ability to achieve profitability is dependent in large part on the success of our development programs, obtaining regulatory approval
for our product candidates and licensing certain of our preclinical compounds, all of which are uncertain. Our product candidates are still being developed, and we do not know whether we will ever achieve sustained profitability or whether cash flow
from future operations will be sufficient to meet our needs. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>We are substantially dependent on Servier for the development and commercialization of
gevokizumab and for other aspects of our business, and if we are unable to maintain our relationship with Servier, or Servier does not perform under its agreements with us, our business would be harmed significantly. </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We have a number of agreements with Servier that are material to the conduct of our business, including: </P>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">In December 2010, we entered into a license and collaboration agreement with Servier, to jointly develop and commercialize gevokizumab in multiple indications. Under the terms of the agreement, Servier has worldwide
rights to cardiovascular disease and diabetes indications and rights outside the United States and Japan to all other indications, including Beh&ccedil;et&#146;s disease uveitis and other inflammatory and oncology indications. In late 2011, we
announced Servier agreed to include the NIU Phase 3 trials under the terms of the collaboration agreement for Beh&ccedil;et&#146;s disease uveitis. We retain development and commercialization rights for NIU and other inflammatory disease and
oncology indications in the United States and Japan and have an option to reacquire rights to cardiovascular disease and diabetes indications from Servier in these territories. Should we exercise this option, we will be required to pay an option fee
to Servier and partially reimburse a specified portion of Servier&#146;s incurred development expenses. The agreement contains mutual customary termination rights relating to matters such as material breach by either party. Servier may terminate for
safety issues, and we may terminate the agreement, with respect to a particular country or the European Patent Organization (&#147;EPO&#148;) member states, for any challenge to our patent rights in that country or any EPO member state,
respectively, by Servier. Servier also has a unilateral right to terminate the agreement for the European Union (&#147;EU&#148;) or for non-EU countries, on a country-by-country basis, or in its entirety, in each case with nine months&#146; notice.
</TD></TR></TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-9 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>


<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">In December 2010, we entered into a loan agreement with Servier (the &#147;Servier Loan Agreement&#148;), which provides for an advance of up to &#128;15.0&nbsp;million and was funded fully in January 2011 with the
proceeds converting to approximately $19.5&nbsp;million at the January&nbsp;13, 2011, Euro-to-U.S.-dollar exchange rate of 1.3020. This loan is secured by an interest in our intellectual property rights to all gevokizumab indications worldwide,
excluding the United States and Japan. The loan has a final maturity date in 2016; however, after a specified period prior to final maturity, the loan is required to be repaid (1)&nbsp;at Servier&#146;s option, by applying up to a significant
percentage of any milestone or royalty payments owed by Servier under our collaboration agreement and (2)&nbsp;using a significant percentage of any upfront, milestone or royalty payments we receive from any third-party collaboration or development
partner for rights to gevokizumab in the United States and/or Japan. In addition, the loan becomes immediately due and payable upon certain customary events of default. At September&nbsp;30, 2014, the &#128;15.0&nbsp;million outstanding principal
balance under this Servier Loan Agreement would have equaled approximately $19.0&nbsp;million using the September&nbsp;30, 2014 Euro-to-U.S.-dollar exchange rate of 1.2685. </TD></TR></TABLE>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Because Servier is an independent third party, it may be subject to different risks than we are and has significant discretion in, and
different criteria for, determining the efforts and resources it will apply related to its agreements with us. Even though we have a collaborative relationship with Servier, our relationship could deteriorate or other circumstances may prevent our
relationship with Servier from resulting in successful development of marketable products. If we are not able to maintain our working relationship with Servier, or if Servier does not perform under its agreements with us, our ability to develop and
commercialize gevokizumab would be materially and adversely affected. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>If our therapeutic product candidates do not receive regulatory approval,
neither our third-party collaborators nor we will be able to market them. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Our product candidates (including gevokizumab, XMetA,
XMetS, XOMA358 and XOMA 3AB) cannot be manufactured and marketed in the United States or any other countries without required regulatory approvals. The U.S. government and governments of other countries extensively regulate many aspects of our
product candidates, including: </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">clinical development and testing; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">manufacturing; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">labeling; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">storage; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">record keeping; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">promotion and marketing; and </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">importing and exporting. </TD></TR></TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In the United States, the FDA regulates pharmaceutical products
under the Federal Food, Drug, and Cosmetic Act and other laws, including, in the case of biologics, the Public Health Service Act. At the present time, we believe many of our product candidates (including gevokizumab, XMetA, XMetS XOMA 358 and XOMA
3AB) will be regulated by the FDA as biologics. Initiation of clinical trials requires approval by health authorities. Clinical trials involve the administration of the investigational new drug to healthy volunteers or to patients under the
supervision of a qualified principal investigator. Clinical trials must be conducted in accordance with FDA and International Conference on Harmonisation of Technical Requirements for Registration of Pharmaceuticals for Human Use Good Clinical
Practices and the European Clinical Trials Directive under protocols that detail the objectives of the study, the parameters to be used to monitor safety and the efficacy criteria to be evaluated. Other national, foreign and local
</P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-10 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
regulations also may apply. The developer of the drug must provide information relating to the characterization and controls of the product before administration to the patients participating in
the clinical trials. This requires developing approved assays of the product to test before administration to the patient and during the conduct of the trial. In addition, developers of pharmaceutical products must provide periodic data regarding
clinical trials to the FDA and other health authorities, and these health authorities may issue a clinical hold upon a trial if they do not believe, or cannot confirm, that the trial can be conducted without unreasonable risk to the trial
participants. We cannot assure you that U.S. and foreign health authorities will not issue a clinical hold with respect to any of our clinical trials in the future. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The results of the preclinical studies and clinical testing, together with chemistry, manufacturing and controls information, are submitted to
the FDA and other health authorities in the form of an NDA for a drug, and in the form of a Biologic License Application (&#147;BLA&#148;) for a biological product, requesting approval to commence commercial sales. In responding to an NDA or BLA,
the FDA or foreign health authorities may grant marketing approvals, request additional information or further research, or deny the application if it determines the application does not satisfy its regulatory approval criteria. Regulatory approval
of an NDA, BLA, or supplement never is guaranteed, the approval process can take several years, is extremely expensive and can vary substantially based upon the type, complexity, and novelty of the products involved, as well as the target
indications. FDA regulations and policies permit applicants to request accelerated or priority review pathways for products intended to treat certain serious or life-threatening illnesses in certain circumstances. If granted by the FDA, these review
pathways can provide a shortened timeline to commercialize the product, although the shortened review timeline is often accompanied with additional post-market requirements. Although we may pursue the FDA&#146;s accelerated or priority review
programs, we cannot guarantee the FDA will permit us to utilize these pathways or the FDA&#146;s review of our application will not be delayed. Moreover, even if the FDA agrees to an accelerated or priority review of any of our applications, we may
not ultimately be able to obtain approval of our application in a timely fashion or at all. The FDA and foreign health authorities have substantial discretion in the drug and biologics approval processes. Despite the time and expense incurred,
failure can occur at any stage, and we could encounter problems that cause us to abandon clinical trials or to repeat or perform additional preclinical, clinical or manufacturing-related studies. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Changes in the regulatory approval policy during the development period, changes in, or the enactment of additional regulations or statutes,
or changes in regulatory review for each submitted product application may cause delays in the approval or rejection of an application. State regulations may also affect our proposed products. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The FDA and other regulatory agencies have substantial discretion in both the product approval process and manufacturing facility approval
process, and as a result of this discretion and uncertainties about outcomes of testing, we cannot predict at what point, or whether, the FDA or other regulatory agencies will be satisfied with our or our collaborators&#146; submissions or whether
the FDA or other regulatory agencies will raise questions that may be material and delay or preclude product approval or manufacturing facility approval. In light of this discretion and the complexities of the scientific, medical and regulatory
environment, our interpretation or understanding of the FDA&#146;s or other regulatory agencies&#146; requirements, guidelines or expectations may prove incorrect, which also could delay further or increase the cost of the approval process. As we
accumulate additional clinical data, we will submit it to the FDA and other regulatory agencies, as appropriate, and such data may have a material impact on the approval process. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Given that regulatory review is an interactive and continuous process, we maintain a policy of limiting announcements and comments upon the
specific details of regulatory review of our product candidates, subject to our obligations under the securities laws, until definitive action is taken. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>We have received negative results from certain of our clinical trials, and we face uncertain results of other clinical trials of our product candidates.
</I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Drug development has inherent risk, and we are required to demonstrate through adequate and well-controlled clinical trials that
our product candidates are effective, with a favorable benefit-risk profile for use in their target profiles before we can seek regulatory approvals for their commercial use. It is possible we may never receive regulatory approval for any of our
product candidates. Even if a product candidate receives regulatory approval, the resulting product may not gain market acceptance among physicians, patients, healthcare payors and the medical community. In March 2011, we announced our 421-patient
Phase 2b trial of gevokizumab in Type&nbsp;2 diabetes </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-11 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
did not achieve the primary endpoint of reduction in hemoglobin A1c (&#147;HbA1c&#148;) after six monthly treatments with gevokizumab compared to placebo. In June 2011, we announced top-line
trial results from our six-month 74-patient Phase 2a trial of gevokizumab in Type 2 diabetes, and there were no differences in glycemic control between the drug and placebo groups as measured by HbA1c levels. In March 2014, we reported that despite
early positive results in our gevokizumab proof of concept study in patients with erosive osteoarthritis of the hand (&#147;EOA&#148;) and elevated C-reactive protein, the top-line data at Day 168 in that study, as well as data at Day&nbsp;84 in
patients with EOA and non-elevated CRP, were not positive. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Many of our product candidates, including gevokizumab, XMetA, XMetS, XOMA 358
and XOMA 3AB, require significant additional research and development, extensive preclinical studies and clinical trials and regulatory approval prior to any commercial sales. This process is lengthy and expensive, often taking a number of years. As
clinical results frequently are susceptible to varying interpretations that may delay, limit or prevent regulatory approvals, the length of time necessary to complete clinical trials and to submit an application for marketing approval for a final
decision by a regulatory authority varies significantly. As a result, it is uncertain whether: </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">our future filings will be delayed; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">our preclinical and clinical studies will be successful; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">we will be successful in generating viable product candidates to targets; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">we will be able to provide necessary additional data; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">results of future clinical trials will justify further development; or </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">we ultimately will achieve regulatory approval for any of these product candidates. </TD></TR></TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The
timing of the commencement, continuation and completion of clinical trials may be subject to significant delays relating to various causes, including completion of preclinical testing and earlier-stage clinical trials in a timely manner, engaging
contract research organizations and other service providers, scheduling conflicts with participating clinicians and clinical institutions, difficulties in identifying and enrolling patients who meet trial eligibility criteria and shortages of
available drug supply. Patient enrollment is a function of many factors, including the size of the patient population, the proximity of patients to clinical sites, the eligibility criteria for the trial, the existence of competing clinical trials
and the availability of alternative or new treatments. Regardless of the initial size or relative complexity of a clinical trial, the costs of such trial may be higher than expected due to increases in duration or size of the trial, changes in the
protocol pursuant to which the trial is being conducted, additional or special requirements of one or more of the healthcare centers where the trial is being conducted, or changes in the regulatory requirements applicable to the trial or in the
standards or guidelines for approval of the product candidate being tested or for other unforeseen reasons. In addition, we conduct clinical trials in foreign countries, which may subject us to further delays and expenses as a result of increased
drug shipment costs, additional regulatory requirements and the engagement of foreign clinical research organizations, as well as expose us to risks associated with foreign currency transactions insofar as we might desire to use U.S. Dollars to make
contract payments denominated in the foreign currency where the trial is being conducted. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">All of our product candidates are prone to the
risks of failure inherent in drug development. Preclinical studies may not yield results that satisfactorily support the filing of an Investigational New Drug application (&#147;IND&#148;) (or a foreign equivalent) with respect to our product
candidates. Even if these applications would be or have been filed with respect to our product candidates, the results of preclinical studies do not necessarily predict the results of clinical trials. Similarly, early stage clinical trials in
healthy volunteers do not predict the results of later-stage clinical trials, including the safety and efficacy profiles of any particular product candidates. In addition, there can be no assurance the design of our clinical trials is focused on
appropriate indications, patient populations, dosing regimens or other variables that will result in obtaining the desired efficacy data to support regulatory approval to commercialize the drug. Moreover, FDA officials or foreign regulatory agency
officials may question the integrity of our data or otherwise subject our clinical trials to additional scrutiny when the clinical trials are conducted by principal </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-12 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
investigators who serve, or previously served, as scientific advisors or consultants to us and receive cash compensation in connection with such services. Preclinical and clinical data can also
be interpreted in different ways. Accordingly, FDA officials or officials from foreign regulatory authorities could interpret the data differently than we or our collaboration or development partners do, which could delay, limit or prevent
regulatory approval. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Administering any of our products or potential products may produce undesirable side effects, also known as adverse
effects. Toxicities and adverse effects that we have observed in preclinical studies for some compounds in a particular research and development program may occur in preclinical studies or clinical trials of other compounds from the same program.
Such toxicities or adverse effects could delay or prevent the filing of an IND (or a foreign equivalent) with respect to such products or potential products or cause us to cease clinical trials with respect to any drug candidate. In clinical trials,
administering any of our products or product candidates to humans may produce adverse effects. These adverse effects could interrupt, delay or halt clinical trials of our products and product candidates and could result in the FDA or other
regulatory authorities denying approval of our products or product candidates for any or all targeted indications. The FDA, other regulatory authorities, our collaboration or development partners or we may suspend or terminate clinical trials at any
time. Even if one or more of our product candidates were approved for sale, the occurrence of even a limited number of toxicities or adverse effects when used in large populations may cause the FDA or other regulatory authorities to impose
restrictions on, or stop, the further marketing of such drugs. Indications of potential adverse effects or toxicities that may occur in clinical trials and that we believe are not significant during the course of such clinical trials may actually
turn out later to constitute serious adverse effects or toxicities when a drug has been used in large populations or for extended periods of time. Any failure or significant delay in completing preclinical studies or clinical trials for our product
candidates, or in receiving and maintaining regulatory approval for the sale of any drugs resulting from our product candidates, may severely harm our reputation and business. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>We rely on third parties to provide services in connection with our product candidate development and manufacturing programs. The inadequate performance
by or loss of any of these service providers could affect our product candidate development. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Several third parties provide
services in connection with our preclinical and clinical development programs, including in vitro and in vivo studies, assay and reagent development, immunohistochemistry, toxicology, pharmacokinetics, clinical trial support, manufacturing and other
outsourced activities. If these service providers do not adequately perform the services for which we have contracted or cease to continue operations and we are not able to find a replacement provider quickly or we lose information or items
associated with our product candidates, our development programs may be delayed. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>We may not obtain orphan drug exclusivity, or we may not receive
the full benefit of orphan drug exclusivity even if we obtain such exclusivity. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The FDA has awarded orphan drug status to
gevokizumab for the treatment of non-infectious, intermediate, posterior or pan uveitis, chronic non-infectious anterior uveitis, pyoderma gangrenosum chronic non-infectious anterior uveitis and Beh&ccedil;et&#146;s disease uveitis. Under the Orphan
Drug Act, the first company to receive FDA approval for gevokizumab for the designated orphan drug indication will obtain seven years of marketing exclusivity, during which time the FDA may not approve another company&#146;s application for another
drug for the same orphan indication unless the FDA concludes that the later drug is safer, more effective or makes a major contribution to patient care. Even though we have obtained orphan drug designation for certain indications for gevokizumab and
even if we obtain orphan drug designation for our future product candidates or other indications, due to the uncertainties associated with developing pharmaceutical products, we may not be the first to obtain marketing approval for any particular
orphan indication, or we may not obtain approval for an indication for which we have obtained orphan drug designation. Further, even if we obtain orphan drug exclusivity for a product, that exclusivity may not protect the product effectively from
competition because different drugs can be approved for the same condition. Even after an orphan drug is approved, the FDA can subsequently approve another drug for the same condition if the FDA concludes that the later drug is safer, more effective
or makes a major contribution to patient care. Orphan drug designation neither shortens the development time or regulatory review time of a drug, nor gives the drug any advantage in the regulatory review or approval process. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-13 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>Even after FDA approval, a product may be subject to additional testing or significant marketing
restrictions, its approval may be withdrawn or it may be removed voluntarily from the market. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Even if we receive regulatory
approval for our product candidates, we will be subject to ongoing regulatory oversight and review by the FDA and other regulatory entities. The FDA, the European Medicines Agency (&#147;EMA&#148;) or another regulatory agency may impose, as a
condition of the approval, ongoing requirements for post-approval studies or post-approval obligations, including additional research and development and clinical trials, and the FDA, EMA or other regulatory agency subsequently may withdraw approval
based on these additional trials. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Even for approved products, the FDA, EMA or other regulatory agency may impose significant restrictions
on the indicated uses, conditions for use, labeling, advertising, promotion, marketing and/or production of such product. In addition, the labeling, packaging, adverse event reporting, storage, advertising, promotion and record-keeping for our
products are subject to extensive regulatory requirements. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Furthermore, a marketing approval of a product may be withdrawn by the FDA,
the EMA or another regulatory agency or such a product may be withdrawn voluntarily by the company marketing it based, for example, on subsequently arising safety concerns. The FDA, EMA and other agencies also may impose various civil or criminal
sanctions for failure to comply with regulatory requirements, including withdrawal of product approval. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>We may issue additional equity securities
and thereby materially and adversely affect the price of our common stock. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We are authorized to issue, without stockholder
approval, 1,000,000 shares of preferred stock, of which none were issued and outstanding as of November&nbsp;3, 2014, which may give other stockholders dividend, conversion, voting, and liquidation rights, among other rights, which may be superior
to the rights of holders of our common stock. In addition, we are authorized to issue, generally without stockholder approval, up to 277,333,332 shares of common stock, of which 107,394,984 were issued and outstanding as of November&nbsp;3, 2014. If
we issue additional equity securities, the price of our common stock may be materially and adversely affected. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">As part of our fundraising
efforts, from time to time we offer securities through underwritten public offerings. In 2013, we completed two such offerings, one in August 2013 when we sold 8,736,187 shares of our common stock at a public offering price of $3.62 per share and
the other in December 2013, when we sold 10,925,000 shares of our common stock at a public offering price of $5.25 per share. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In
addition, funding from collaboration partners and others has in the past and may in the future involve issuance by us of our common stock. We cannot be certain how the purchase price of such shares, the relevant market price or premium, if any, will
be determined or when such determinations will be made. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Any issuance by us of equity securities, whether through an underwritten public
offering, an at the market offering, a private placement, in connection with a collaboration or otherwise could result in dilution in the value of our issued and outstanding shares, and a decrease in the trading price of our common stock. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>Our share price may be volatile and there may not be an active trading market for our common stock. </I></B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">There can be no assurance the market price of our common stock will not decline below its present market price or there will be an active
trading market for our common stock. The market prices of biotechnology companies have been and are likely to continue to be highly volatile. Fluctuations in our operating results and general market conditions for biotechnology stocks could have a
significant impact on the volatility of our common stock price. We have experienced significant volatility in the price of our common stock. From January&nbsp;1, 2014 through December 8, 2014, the share price of our common stock has ranged from a
high of $9.57 to a low of $3.42. Factors contributing to such volatility include, but are not limited to: </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">results of preclinical studies and clinical trials; </TD></TR></TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-14 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>


<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">information relating to the safety or efficacy of products or product candidates; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">developments regarding regulatory filings; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">announcements of new collaborations; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">failure to enter into collaborations; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">developments in existing collaborations; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">our funding requirements and the terms of our financing arrangements; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">technological innovations or new indications for our therapeutic products and product candidates; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">introduction of new products or technologies by us or our competitors; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">sales and estimated or forecasted sales of products for which we receive royalties, if any; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">government regulations; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">developments in patent or other proprietary rights; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the number of shares issued and outstanding; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the number of shares trading on an average trading day; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">announcements regarding other participants in the biotechnology and pharmaceutical industries; and </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">market speculation regarding any of the foregoing. </TD></TR></TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>As a public company in the United States, we are
subject to the Sarbanes-Oxley Act. We have determined that our disclosure controls and procedures and our internal control over financial reporting are currently not effective. We can provide no assurance that we will, at all times, in the future be
able to report that our internal controls over financial reporting are effective. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Companies that file reports with the Securities
and Exchange Commission, or the SEC, including us, are subject to the requirements of Section&nbsp;404 of the Sarbanes-Oxley Act of 2002. Section&nbsp;404 requires management to establish and maintain a system of internal control over financial
reporting, and annual reports on Form 10-K filed under the Securities Exchange Act of 1934, as amended, or the Exchange Act, must contain a report from management assessing the effectiveness of a company&#146;s internal control over financial
reporting. Ensuring that we have adequate internal financial and accounting controls and procedures in place to produce accurate financial statements on a timely basis is a time-consuming effort that needs to be re-evaluated frequently. Failure on
our part to have effective internal financial and accounting controls would cause our financial reporting to be unreliable, could have a material adverse effect on our business, operating results, and financial condition, and could cause the trading
price of our common stock to fall. We have identified a material weakness in our internal controls that is described in greater detail in our Form 10-Q under section &#147;Item 4-Controls and Procedures&#148; incorporated by reference to this
prospectus. Until we have been able to test the operating effectiveness of remediated internal controls and ensure the effectiveness of our disclosure controls and procedures, any un-remediated material weaknesses may materially adversely affect our
ability to report accurately our financial condition and results of operations in the future in a timely and reliable manner, and we would be unable to maintain compliance with securities law requirements regarding timely filing of periodic reports
in addition to applicable stock exchange listing requirements, investors may lose confidence in our financial reporting, and our stock price may decline as a result. In addition, although we continually review and evaluate internal control systems
to allow management to report on the sufficiency of our internal controls, we cannot assure you that in the future we will not discover additional weaknesses in our internal control over financial reporting. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-15 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>We are subject to various state and federal healthcare related laws and regulations that may impact the
commercialization of our product candidates or could subject us to significant fines and penalties. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Our operations may be
directly or indirectly subject to various state and federal healthcare laws, including, without limitation, the federal Anti-Kickback Statute, the federal False Claims Act and state and federal privacy and security laws. These laws may impact, among
other things, the commercial operations for any of our product candidates that may be approved for commercial sale. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The federal
Anti-Kickback Statute prohibits persons from knowingly and willfully soliciting, offering, receiving or providing remuneration, directly or indirectly, in exchange for or to induce either the referral of an individual, or the furnishing or arranging
for a good or service, for which payment may be made under a federal healthcare program, such as the Medicare and Medicaid programs. Several courts have interpreted the statute&#146;s intent requirement to mean that if any one purpose of an
arrangement involving remuneration is to induce referrals of federal healthcare covered business, the statute has been violated. The Anti-Kickback Statute is broad and prohibits many arrangements and practices that are lawful in businesses outside
of the healthcare industry. Penalties for violations of the federal Anti-Kickback Statute include criminal penalties and civil sanctions such as fines, penalties, imprisonment and possible exclusion from Medicare, Medicaid and other federal
healthcare programs. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The federal False Claims Act prohibits persons from knowingly filing, or causing to be filed, a false claim to, or
the knowing use of false statements to obtain payment from the federal government. Suits filed under the False Claims Act, known as &#147;qui tam&#148; actions, can be brought by any individual on behalf of the government and such individuals,
commonly known as &#147;whistleblowers&#148;, may share in any amounts paid by the entity to the government in fines or settlement. The filing of qui tam actions has caused a number of pharmaceutical, medical device and other healthcare companies to
have to defend a False Claims Act action. When an entity is determined to have violated the False Claims Act, it may be required to pay up to three times the actual damages sustained by the government, plus civil penalties for each separate false
claim. Various states also have enacted laws modeled after the federal False Claims Act. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The Federal Health Insurance Portability and
Accountability Act of 1996 (&#147;HIPAA&#148;), created new federal criminal statutes that prohibit executing a scheme to defraud any healthcare benefit program and making false statements relating to healthcare matters. The health care fraud
statute prohibits knowingly and willfully executing a scheme to defraud any health care benefit program, including private payors. The false statements statute prohibits knowingly and willfully falsifying, concealing or covering up a material fact
or making any materially false, fictitious or fraudulent statement in connection with the delivery of or payment for health care benefits, items or services. HIPAA, as amended by the Health Information Technology and Clinical Health Act
(&#147;HITECH&#148;), and its implementing regulations, also impose certain requirements relating to the privacy, security and transmission of individually identifiable health information. We take our obligation to maintain our compliance with these
various laws and regulations seriously. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In addition, there has been a recent trend of increased federal and state regulation of payments
made to physicians. The Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010, or collectively, (&#147;PPACA&#148;), among other things, imposed new requirements on manufacturers of drugs,
devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children&#146;s Health Insurance Program (with certain exceptions) to report annually to the Centers for Medicare&nbsp;&amp; Medicaid Services,
(&#147;CMS&#148;), information related to payments or other &#147;transfers of value&#148; made to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors) and teaching hospitals, and applicable manufacturers
and group purchasing organizations to report annually to CMS ownership and investment interests held by physicians (as defined above) and their immediate family members and payments or other &#147;transfers of value&#148; to such physician owners
and their immediate family members. Manufacturers were required to begin data collection on August&nbsp;1, 2013 and were required to report such data to the government by March&nbsp;31, 2014 and by the 90th calendar day of each year thereafter.
Failure to submit required information may result in civil monetary penalties of up to an aggregate of $150,000 per year (or up to an aggregate of $1 million per year for &#147;knowing failures&#148;), for all payments, transfers of value or
ownership or investment interests not reported in an annual submission. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-16 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Many states also have adopted laws similar to each of the federal laws described above, some of
which apply to healthcare items or services reimbursed by any source, not only the Medicare and Medicaid programs. In addition, some states have laws that require pharmaceutical companies to comply with the pharmaceutical industry&#146;s voluntary
compliance guidelines and the applicable compliance guidance promulgated by the federal government, or otherwise restrict payments that may be made to healthcare providers and other potential referral sources, and to report information related to
payments and other transfers of value to physicians and other healthcare providers; and state laws governing the privacy and security of health information in certain circumstances, many of which differ from each other in significant ways and may
not have the same effect, thus complicating compliance efforts. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Because of the breadth of these laws, it is possible that some of our
business activities could be subject to challenge under one or more of such laws. The PPACA also make several important changes to the federal Anti-Kickback Statute, false claims laws, and health care fraud statute by weakening the intent
requirement under the anti-kickback and health care fraud statutes that may make it easier for the government, or whistleblowers to charge such fraud and abuse violations. A person or entity no longer needs to have actual knowledge of this statute
or specific intent to violate it. In addition, the PPACA provides that the government may assert that a claim including items or services resulting from a violation of the federal Anti-Kickback Statute constitutes a false or fraudulent claim for
purposes of the false claims statutes. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">If we are found to be in violation of any of the laws and regulations described above or other
applicable state and federal healthcare laws, we may be subject to penalties, including civil and criminal penalties, damages, fines, exclusion from government healthcare reimbursement programs and the curtailment or restructuring of our operations,
any of which could have a material adverse effect on our business and results of operations. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>Certain of our technologies are in-licensed from third
parties, so our capabilities using them are restricted and subject to additional risks. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We license technologies from third
parties. These technologies include but are not limited to phage display technologies licensed to us in connection with our bacterial cell expression technology licensing program and antibody products. However, our use of these technologies is
limited by certain contractual provisions in the licenses relating to them, and although we have obtained numerous licenses, intellectual property rights in the area of phage display are particularly complex. If the owners of the patent rights
underlying the technologies that we license do not properly maintain or enforce those patents, our competitive position and business prospects could be harmed. Our success will depend in part on the ability of our licensors to obtain, maintain and
enforce our in-licensed intellectual property. Our licensors may not be successful in prosecuting the patent applications to which we have licenses, or our licensors may fail to maintain existing patents. They may determine not to pursue litigation
against other companies that are infringing these patents, or they may pursue such litigation less aggressively than we would. Our licensors also may seek to terminate our license, which could cause us to lose the right to use the licensed
intellectual property and adversely affect our ability to commercialize our technologies, products or services. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>We do not know whether there will
be, or will continue to be, a viable market for the products in which we have an ownership or royalty interest. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Even if products
in which we have an interest receive approval in the future, they may not be accepted in the marketplace. In addition, we or our collaborators or licensees may experience difficulties in launching new products, many of which are novel and based on
technologies that are unfamiliar to the healthcare community. We have no assurance healthcare providers and patients will accept such products, if developed. For example, physicians and/or patients may not accept a product for a particular
indication because it has been biologically derived (and not discovered and developed by more traditional means) or if no biologically derived products are currently in widespread use in that indication. Similarly, physicians may not accept a
product if they believe other products to be more effective or more cost effective or are more comfortable prescribing other products. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-17 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Safety concerns also may arise in the course of on-going clinical trials or patient treatment as
a result of adverse events or reactions. For example, in February 2009, the EMA announced it had recommended suspension of the marketing authorization of RAPTIVA in the EU and EMD Serono Inc., the company that marketed RAPTIVA in Canada (&#147;EMD
Serono&#148;) announced that in consultation with Health Canada, the Canadian health authority (&#147;Health Canada&#148;), it would suspend marketing of RAPTIVA in Canada. In March 2009, Merck Serono Australia Pty Ltd, the company that marketed
RAPTIVA in Australia (&#147;Merck Serono Australia&#148;), following a recommendation from the Therapeutic Goods Administration, the Australian health authority (&#147;TGA&#148;), announced it was withdrawing RAPTIVA from the Australian market. In
the second quarter of 2009, Genentech announced and carried out a phased voluntary withdrawal of RAPTIVA from the U.S. market, based on the association of RAPTIVA with an increased risk of PML, and sales of the product ceased. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Furthermore, government agencies, as well as private organizations involved in healthcare, from time to time publish guidelines or
recommendations to healthcare providers and patients. Such guidelines or recommendations can be very influential and may adversely affect product usage directly (for example, by recommending a decreased dosage of a product in conjunction with a
concomitant therapy or a government entity withdrawing its recommendation to screen blood donations for certain viruses) or indirectly (for example, by recommending a competitive product over our product). Consequently, we do not know if physicians
or patients will adopt or use our products for their approved indications. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Even approved and marketed products are subject to risks
relating to changes in the market for such products. Introduction or increased availability of generic versions of products can alter the market acceptance of branded products. In addition, unforeseen safety issues may arise at any time, regardless
of the length of time a product has been on the market. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>In addition to our agreements with Servier, our agreements with other third parties, many
of which are significant to our business, expose us to numerous risks. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Our financial resources and our marketing experience and
expertise are limited. Consequently, our ability to develop products successfully depends, to a large extent, upon securing the financial resources and/or marketing capabilities of third parties other than Servier. For example: </P>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">In March 2004, we announced we had agreed to collaborate with Chiron Corporation (now Novartis) for the development and commercialization of antibody products for the treatment of cancer. In April 2005, we announced the
initiation of clinical testing of the first product candidate out of the collaboration, HCD122, an anti-CD40 antibody, in patients with advanced chronic lymphocytic leukemia. In October 2005, we announced the initiation of the second clinical trial
of HCD122 in patients with multiple myeloma. In November 2008, we announced the restructuring of this product development collaboration, which involved six development programs. In exchange for cash and debt reduction on our existing loan facility
with Novartis, Novartis has control over the programs, as well as the right to expand the development of these programs into additional indications outside of oncology. Clinical development of at least one of the product candidates is ongoing at
Novartis. </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">In March 2005, we entered into a contract with the National Institute of Allergy and Infectious Diseases (&#147;NIAID&#148;) to produce three monoclonal antibodies designed to protect U.S. citizens against the harmful
effects of botulinum neurotoxin used in bioterrorism. In July 2006, we entered into an additional contract with NIAID for the development of an appropriate formulation for human administration of these three antibodies in a single injection. In
September 2008, we announced we had been awarded an additional contract with NIAID to support our on-going development of drug candidates toward clinical trials in the treatment of botulism poisoning. In October 2011, we announced we had been
awarded an additional contract with NIAID to develop broad-spectrum antitoxins for the treatment of human botulism poisoning. </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE="font-family:Times New Roman; font-size:10pt">On July&nbsp;24, 2012, Servier and we entered into an agreement with Boehringer Ingelheim to transfer XOMA&#146;s technology and processes for the
manufacture of gevokizumab to Boehringer lngelheim for </P></TD></TR></TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-18 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>


<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="8%">&nbsp;</TD>
<TD VALIGN="top"> <P STYLE="font-family:Times New Roman; font-size:10pt">
Boehringer Ingelheim&#146;s implementation and validation in preparation for the commercial manufacture of gevokizumab. Upon the successful completion of the transfer and the establishment of
biological comparability, including validation of the XOMA processes as implemented by Boehringer Ingelheim, we intend Boehringer Ingelheim will produce gevokizumab for XOMA&#146;s commercial use at its facility in Biberach, Germany. Servier and we
retain all rights to the development and commercialization of gevokizumab. Transferring of our technology to Boehringer Ingelheim exposes us to numerous risks, including the possibility that Boehringer Ingelheim may not perform under the agreement
as anticipated, and that we will need to successfully conduct a comparability trial demonstrating to the FDA&#146;s satisfaction the similarity between XOMA-manufactured and Boehringer Ingelheim-manufactured product. </P></TD></TR></TABLE>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Because our collaborators, licensees, suppliers and contractors are independent third parties, they may be subject to different risks than we
are and have significant discretion in, and different criteria for, determining the efforts and resources they will apply related to their agreements with us. If these collaborators, licensees, suppliers and contractors do not successfully perform
the functions for which they are responsible, we may not have the capabilities, resources or rights to do so on our own. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We do not know
whether we, our collaborators or licensees will successfully develop and market any of the products that are or may become the subject of any of our collaboration or licensing arrangements. In some cases these arrangements provide for funding solely
by our collaborators or licensees, and in other cases, all of the funding for certain projects and a significant portion of the funding for other projects is to be provided by our collaborator or licensee, and we provide the balance of the funding.
Even when we have a collaborative relationship, other circumstances may prevent it from resulting in successful development of marketable products. In addition, third-party arrangements such as ours also increase uncertainties in the related
decision-making processes and resulting progress under the arrangements, as we and our collaborators or licensees may reach different conclusions, or support different paths forward, based on the same information, particularly when large amounts of
technical data are involved. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Furthermore, our contracts with NIAID contain numerous standard terms and conditions provided for in the
applicable federal acquisition regulations and customary in many government contracts, some of which could allow the U.S. government to exercise certain rights under the technology developed under these contracts. Uncertainty exists as to whether we
will be able to comply with these terms and conditions in a timely manner, if at all. In addition, we are uncertain as to the extent of NIAID&#146;s demands and the flexibility that will be granted to us in meeting those demands. Under our contract
with NIAID, we invoice using NIH provisional rates and these are subject to future audits at the discretions of NIAID&#146;s contracting office. These audits can result in an adjustment to revenue previously reported which potentially could be
significant. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Although we continue to evaluate additional strategic alliances and potential partnerships, we do not know whether or when
any such alliances or partnerships will be entered into. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>Products and technologies of other companies may render some or all of our products and
product candidates noncompetitive or obsolete. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Developments by others may render our products, product candidates, or
technologies obsolete or uncompetitive. Technologies developed and utilized by the biotechnology and pharmaceutical industries are changing continuously and substantially. Competition in antibody-based technologies is intense and is expected to
increase in the future as a number of established biotechnology firms and large chemical and pharmaceutical companies advance in these fields. Many of these competitors may be able to develop products and processes competitive with or superior to
our own for many reasons, including that they may have: </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">significantly greater financial resources; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">larger research and development and marketing staffs; </TD></TR></TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-19 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>


<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">larger production facilities; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">entered into arrangements with, or acquired, biotechnology companies to enhance their capabilities; or </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">extensive experience in preclinical testing and human clinical trials. </TD></TR></TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">These factors may
enable others to develop products and processes competitive with or superior to our own or those of our collaborators. In addition, a significant amount of research in biotechnology is being carried out in universities and other non-profit research
organizations. These entities are becoming increasingly interested in the commercial value of their work and may become more aggressive in seeking patent protection and licensing arrangements. Furthermore, many companies and universities tend not to
announce or disclose important discoveries or development programs until their patent position is secure or, for other reasons, later; as a result, we may not be able to track development of competitive products, particularly at the early stages.
Positive or negative developments in connection with a potentially competing product may have an adverse impact on our ability to raise additional funding on acceptable terms. For example, if another product is perceived to have a competitive
advantage, or another product&#146;s failure is perceived to increase the likelihood that our product will fail, then investors may choose not to invest in us on terms we would accept or at all. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The examples below pertain to competitive events in the market that we review quarterly yet are not intended to be representative of all
existing competitive events. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Gevokizumab </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We, in collaboration with Servier, are developing gevokizumab, a potent monoclonal antibody with unique allosteric modulating properties that
binds strongly to interleukin-1 beta (IL-1 beta), a pro-inflammatory cytokine. In binding to IL-1 beta, gevokizumab inhibits the activation of the IL-1 receptor, thereby modulating the cellular signaling events that produce inflammation. Other
companies are developing products based on the same or similar therapeutic targets as gevokizumab. The efficacy and safety profile of gevokizumab relative to these potential competitors is unknown. We are aware that: </P>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">Novartis markets and is developing ILARIS&reg; (canakinumab, ACZ885), a fully human monoclonal antibody that selectively binds to and neutralizes IL-1 beta. Since 2009, canakinumab has been approved in over 50 countries
for the treatment of children and adults suffering from Cryopyrin-Associated Periodic Syndrome (&#147;CAPS&#148;). The product is indicated in the US for the treatment of CAPS in patients over four years of age, including familial cold
auto-inflammatory syndrome (&#147;FCAS&#148;) and Muckle-Wells syndrome (&#147;MWS&#148;), as well as for active systemic juvenile idiopathic arthritis (&#147;SJIA&#148;) in patients aged two years and older. In the EU, canakinumab is indicated for
the treatment of FCAS, MWS, neonatal-onset multisystem inflammatory disease (&#147;NOMID&#148;)/ chronic infantile neurological cutaneous articular syndrome (&#147;CINCA syndrome&#148;), severe forms of FCAS/familial cold urticaria (&#147;FCU&#148;)
presenting with signs and symptoms beyond cold-induced urticaria skin rash, for the symptomatic treatment of adults with frequent gouty arthritis attacks, and for SJIA in patients aged two years and above who have responded inadequately to previous
therapy with non-steroidal anti-inflammatory drugs and systemic corticosteroids. In Japan, canakinumab is indicated for the treatment of CAPS and associated autoinflammatory symptoms, including FCAS, MWS and NOMID. Novartis also is pursuing other
diseases in which IL-1 beta may play a prominent role, such as: systemic secondary prevention of cardiovascular events; hereditary periodic fever (familial Mediterranean fever (&#147;FMF&#148;)); chronic obstructive pulmonary disorder
(&#147;COPD&#148;); osteoarthritis; urticarial vasculitis; TNF-receptor associated periodic syndrome (&#147;TRAPS&#148;); xerophthalmia; Schnitzler syndrome; polymyalgia rheumatica; hyperimmunoglobulinemia D (hyper-IgD) and periodic fever syndrome
(&#147;HIDS&#148;); and abdominal aortic aneurysm (&#147;AAA&#148;). </TD></TR></TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Regeneron markets and is developing Arcalyst&reg;
(rilonacept), an interleukin-1 blocker currently indicated in the U.S. for the treatment of CAPS, including FCAS and MWS in adults and children 12 and older. Rilonacept is also approved, but not marketed, in the EU for the same patient population.
</P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-20 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>


<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">In 2008, Swedish Orphan Biovitrum obtained from Amgen the global exclusive rights to Kineret&reg; (anakinra) for rheumatoid arthritis as currently indicated in its label. In November 2009, the agreement regarding
Swedish Orphan Biovitrum&#146;s Kineret license was expanded to include certain orphan indications. Kineret is an IL-1 receptor antagonist (IL-1ra) that has been evaluated in multiple IL-1-mediated diseases, including indications we are considering
for gevokizumab. In addition to other on-going studies, a proof-of-concept clinical trial in the United Kingdom investigating Kineret in patients with a certain type of myocardial infarction, or heart attack, has been completed. In January 2013,
Biovitrum obtained FDA approval for NOMID, a severe form of CAPS. In November 2013, Kineret was approved by the European Commission for the treatment of CAPS. Shanghai CP Guojian Pharmaceutical is developing an injectable formulation of recombinant
human IL-1Ra, presumed to be a follow-on biologic version of anakinra, for the potential treatment of rheumatoid arthritis. In February 2010, an NDA was filed with the SFDA; in January 2012, supplemental materials were required by the SFDA to
conclude the review. </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">The following companies have completed or are conducting or planning Phase 3 clinical trials of the following products for the treatment of noninfectious intermediate, posterior or pan-uveitis: AbbVie - HUMIRA&reg;
(adalimumab); Novartis - Myfortic&reg; (mycophenalate sodium), Santen Pharmaceutical Co., Ltd. &#150; Opsiria&reg; (intravitreal sirolimus), and pSivida Corp. &#150; Fluacinolone Acetonide Intravitreal. </TD></TR></TABLE>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In May 2014, AbbVie announced that the FDA had granted HUMIRA&reg; (adalimumab) orphan drug designation for the treatment of non-infectious
intermediate, posterior, or pan-uveitis, or chronic non-infectious anterior uveitis. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In April 2014, Santen announced that SAKURA 1, the
first of two Global Phase 3 studies, met its primary endpoint. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>XOMA 3AB </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We also are developing XOMA 3AB,, a combination, or cocktail, of antibodies designed to neutralize the most potent of botulinum toxins. Other
companies are developing other products targeting botulism poisoning, and these products may prove more effective than XOMA 3AB. We are aware: </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">Emergent Biosolutions Inc. has a contract with the U.S. Department of Health&nbsp;&amp; Human Services, expected to be worth $423.0 million, to manufacture and supply an equine heptavalent botulism anti-toxin. In March
2013, the product was approved by the FDA. </TD></TR></TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>Manufacturing risks and inefficiencies may adversely affect our ability to manufacture
products for ourselves or others. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">To the extent we continue to provide manufacturing services for our own benefit or to third
parties, we are subject to manufacturing risks. Additionally, unanticipated fluctuations in customer requirements may lead to manufacturing inefficiencies, which if significant could lead to an impairment on our long-lived assets or restructuring
activities. We must utilize our manufacturing operations in compliance with regulatory requirements, in sufficient quantities and on a timely basis, while maintaining acceptable product quality and manufacturing costs. Additional resources and
changes in our manufacturing processes may be required for each new product, product modification or customer or to meet changing regulatory or third-party requirements, and this work may not be completed successfully or efficiently. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Manufacturing and quality problems may arise in the future to the extent we continue to perform these manufacturing activities for our own
benefit or for third parties. Consequently, our development goals or milestones may not be achieved in a timely manner or at a commercially reasonable cost, or at all. In addition, to the extent we continue to make investments to improve our
manufacturing operations, our efforts may not yield the improvements that we expect. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-21 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>Failure of our products to meet current Good Manufacturing Practices standards may subject us to delays in
regulatory approval and penalties for noncompliance. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Our contract manufacturers are required to produce our clinical product
candidates under current Good Manufacturing Practices (&#147;cGMP&#148;) to meet acceptable standards for use in our clinical trials and for commercial sale, as applicable. If such standards change, the ability of contract manufacturers to produce
our product candidates on the schedule we require for our clinical trials or to meet commercial requirements may be affected. In addition, contract manufacturers may not perform their obligations under their agreements with us or may discontinue
their business before the time required by us to successfully produce clinical and commercial supplies of our product candidates. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">We and our contract
manufacturers are subject to pre-approval inspections and periodic unannounced inspections by the FDA and corresponding state and foreign authorities to ensure strict compliance with cGMP and other applicable government regulations and corresponding
foreign standards. We do not have control over a third-party manufacturer&#146;s compliance with these regulations and standards. Any difficulties or delays in our contractors&#146; manufacturing and supply of our product candidates or any failure
of our contractors to maintain compliance with the applicable regulations and standards could increase our costs, cause us to lose revenue, make us postpone or cancel clinical trials, prevent or delay regulatory approval by the FDA and corresponding
state and foreign authorities, prevent the import and/or export of our product candidates, or cause any of our product candidates that may be approved for commercial sale to be recalled or withdrawn. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>Because many of the companies with which we do business also are in the biotechnology sector, the volatility of that sector can affect us indirectly as
well as directly. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">As a biotechnology company that collaborates with other biotechnology companies, the same factors that affect
us directly also can adversely impact us indirectly by affecting the ability of our collaborators, partners and others with which we do business to meet their obligations to us and reduce our ability to realize the value of the consideration
provided to us by these other companies. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">For example, in connection with our licensing transactions, we have in the past and may in the
future agree to accept equity securities of the licensee in payment of license fees. The future value of these or any other shares we receive is subject both to market risks affecting our ability to realize the value of these shares and more
generally to the business and other risks to which the issuer of these shares may be subject. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>As we do more business internationally, we will be
subject to additional political, economic and regulatory uncertainties. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We may not be able to operate successfully in any foreign
market. We believe that because the pharmaceutical industry is global in nature, international activities will be a significant part of our future business activities and when and if we are able to generate income, a substantial portion of that
income will be derived from product sales and other activities outside the United States. Foreign regulatory agencies often establish standards different from those in the United States, and an inability to obtain foreign regulatory approvals on a
timely basis could put us at a competitive disadvantage or make it uneconomical to proceed with a product or product candidate&#146;s development. International operations and sales may be limited or disrupted by: </P>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">imposition of government controls; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">export license requirements; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">political or economic instability; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">trade restrictions; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">changes in tariffs; </TD></TR></TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-22 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>


<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">restrictions on repatriating profits; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">exchange rate fluctuations; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">withholding and other taxation; and </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">difficulties in staffing and managing international operations. </TD></TR></TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>We are subject to foreign currency
exchange rate risks. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We are subject to foreign currency exchange rate risks because substantially all of our revenues and
operating expenses are paid in U.S. Dollars, but we incur certain expenses, as well as interest and principal obligations with respect to our loan from Servier in Euros. To the extent the U.S.&nbsp;Dollar declines in value against the Euro, the
effective cost of servicing our Euro-denominated debt will be higher. Changes in the exchange rate result in foreign currency gains or losses. Although we have managed some of our exposure to changes in foreign currency exchange rates by entering
into foreign exchange option contracts, there can be no assurance foreign currency fluctuations will not have a material adverse effect on our business, financial condition, liquidity or results of operations. In addition, our foreign exchange
option contracts are re-valued at each financial reporting period, which also may result in gains or losses from time to time. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>If we and our
partners are unable to protect our intellectual property, in particular our patent protection for our principal products, product candidates and processes, and prevent use of the covered subject matter by third parties, our ability to compete in the
market will be harmed, and we may not realize our profit potential. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We rely on patent protection, as well as a combination of
copyright, trade secret, and trademark laws to protect our proprietary technology and prevent others from duplicating our products or product candidates. However, these means may afford only limited protection and may not: </P>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">prevent our competitors from duplicating our products; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">prevent our competitors from gaining access to our proprietary information and technology; or </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">permit us to gain or maintain a competitive advantage. </TD></TR></TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Because of the length of time and the
expense associated with bringing new products to the marketplace, we and our collaboration and development partners hold and are in the process of applying for a number of patents in the United States and abroad to protect our product candidates and
important processes and also have obtained or have the right to obtain exclusive licenses to certain patents and applications filed by others. However, the mere issuance of a patent is not conclusive as to its validity or its enforceability. The
U.S. Federal Courts or equivalent national courts or patent office elsewhere may invalidate our patents or find them unenforceable. In addition, the laws of foreign countries may not protect our intellectual property rights effectively or to the
same extent as the laws of the United States. If our intellectual property rights are not protected adequately, we may not be able to commercialize our technologies, products, or services, and our competitors could commercialize our technologies,
which could result in a decrease in our sales and market share that would harm our business and operating results. Specifically, the patent position of biotechnology companies generally is highly uncertain and involves complex legal and factual
questions. The legal standards governing the validity of biotechnology patents are in transition, and current defenses as to issued biotechnology patents may not be adequate in the future. Accordingly, there is uncertainty as to: </P>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">whether any pending or future patent applications held by us will result in an issued patent, or that if patents are issued to us, that such patents will provide meaningful protection against competitors or competitive
technologies; </TD></TR></TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-23 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>


<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">whether competitors will be able to design around our patents or develop and obtain patent protection for technologies, designs or methods that are more effective than those covered by our patents and patent
applications; or </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the extent to which our product candidates could infringe on the intellectual property rights of others, which may lead to costly litigation, result in the payment of substantial damages or royalties, and/or prevent us
from using technology that is essential to our business. </TD></TR></TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We have established a portfolio of patents, both United States and
foreign, related to our bacterial cell expression technology, including claims to novel promoter sequences, secretion signal sequences, compositions and methods for expression and secretion of recombinant proteins from bacteria, including
immunoglobulin gene products. Most of the more important European patents in our bacterial cell expression patent portfolio expired in July 2008 or earlier. The last of the more important United States patents in our bacterial cell expression
(&#147;BCE&#148;) patent portfolio will expire in December 2014. The last-to-expire patent licensed under the majority of our BCE license agreements is Canadian patent 1,341,235, which is expected to expire in May 2018. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">If certain patents issued to others are upheld or if certain patent applications filed by others issue and are upheld, we may require licenses
from others to develop and commercialize certain potential products incorporating our technology or we may become involved in litigation to determine the proprietary rights of others. These licenses, if required, may not be available on acceptable
terms, and any such litigation may be costly and may have other adverse effects on our business, such as inhibiting our ability to compete in the marketplace and absorbing significant management time. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Due to the uncertainties regarding biotechnology patents, we also have relied and will continue to rely upon trade secrets, know-how and
continuing technological advancement to develop and maintain our competitive position. All of our employees have signed confidentiality agreements under which they have agreed not to use or disclose any of our proprietary information. Research and
development contracts and relationships between us and our scientific consultants and potential customers provide access to aspects of our know-how that are protected generally under confidentiality agreements. These confidentiality agreements may
be breached or may not be enforced by a court. To the extent proprietary information is divulged to competitors or to the public generally, such disclosure may affect our ability to develop or commercialize our products adversely by giving others a
competitive advantage or by undermining our patent position. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>Litigation regarding intellectual property can be costly and expose us to risks of
counterclaims against us. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We may be required to engage in litigation or other proceedings to protect our intellectual property.
The cost to us of this litigation, even if resolved in our favor, could be substantial. Such litigation also could divert management&#146;s attention and resources. In addition, if this litigation is resolved against us, our patents may be declared
invalid, and we could be held liable for significant damages. In addition, we may be subject to a claim that we are infringing another party&#146;s patent. If such claim is resolved against us, we or our collaborators may be enjoined from
developing, manufacturing, selling or importing products, processes or services unless we obtain a license from the other party. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Such
license may not be available on reasonable terms, thus preventing us from using these products, processes or services and adversely affecting our revenue. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>We may be unable to price our products effectively or obtain adequate reimbursement for sales of our products, which would prevent our products from
becoming profitable. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">If we or our third-party collaborators or licensees succeed in bringing our product candidates to the
market, they may not be considered cost effective, and reimbursement to the patient may not be available or may not be sufficient to allow us to sell our products on a competitive basis. In both the United States and elsewhere, sales of medical
products and treatments are dependent, in part, on the availability of reimbursement to the patient from third-party payors, such as government and private insurance plans. Third-party payors are increasingly challenging
</P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-24 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
the prices charged for pharmaceutical products and services. Our business is affected by the efforts of government and third-party payors to contain or reduce the cost of healthcare through
various means. In the United States, there have been and will continue to be a number of federal and state proposals to implement government controls on pricing. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In addition, the emphasis on managed care in the United States has increased and will continue to increase the pressure on the pricing of
pharmaceutical products. We cannot predict whether any legislative or regulatory proposals will be adopted or the effect these proposals or managed care efforts may have on our business. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>Healthcare reform measures and other statutory or regulatory changes could adversely affect our business. </I></B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In both the United States and certain foreign jurisdictions, there have been a number of legislative and regulatory proposals to change the
healthcare system in ways that could impact our business. In March 2010, the U.S. Congress enacted and President Obama signed into law the PPACA, which includes a number of healthcare reform provisions that are expected to significantly impact the
pharmaceutical industry. The PPACA, among other things, imposes a non-deductible annual fee on pharmaceutical manufacturers or importers who sell &#147;branded prescription drugs&#148;; increases the minimum level of Medicaid rebates payable by
manufacturers of brand-name drugs from 15.1% to 23.1%; requires collection of rebates for drugs paid by Medicaid managed care organizations; addresses new methodologies by which rebates owed by manufacturers under the Medicaid Drug Rebate Program
are calculated for drugs that are inhaled, infused, instilled, implanted or injected, and for drugs that are line extension products; and requires manufacturers to participate in a coverage gap discount program, under which they must agree to offer
50% point-of-sale discounts off negotiated prices of applicable brand drugs to eligible beneficiaries during their coverage gap period, as a condition for the manufacturer&#146;s outpatient drugs to be covered under Medicare Part D. While the law
may increase the number of patients who have insurance coverage for our products or product candidates, its cost containment measures also could adversely affect coverage and reimbursement for our existing or potential products; however, the full
effects of this law cannot be known until these provisions are implemented and the relevant Federal and state agencies issue applicable regulations or guidance. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Other legislative changes have been proposed and adopted since the PPACA was enacted. On August&nbsp;2, 2011, the President signed into law
the Budget Control Act of 2011, which, among other things, created the Joint Select Committee on Deficit Reduction to recommend proposals in spending reductions to Congress. The Joint Select Committee did not achieve its targeted deficit reduction
of at least $1.2 trillion for the years 2013 through 2021, triggering the legislation&#146;s automatic reductions to several government programs. These reductions include aggregate reductions to Medicare payments to providers of up to 2%&nbsp;per
fiscal year, which went into effect on April&nbsp;1, 2013 and are scheduled to remain in effect until 2024. On January&nbsp;2, 2013, President Obama signed into law the American Taxpayer Relief Act of 2012, (&#147;ATRA&#148;), which, among other
things, further reduced Medicare payments to several providers, including hospitals, imaging centers and cancer treatment centers. We expect that additional state and federal healthcare reform measures will be adopted in the future, any of which
could limit the amounts that federal and state governments will pay for healthcare products and services, which could result in reduced demand for our products once approved or additional pricing pressures, a decrease in the share price of our
common stock, limit our ability to raise capital or to obtain strategic collaborations or licenses or successfully commercialize our products. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The pharmaceutical and biotechnology industries are subject to extensive regulation, and from time to time, legislative bodies and
governmental agencies consider changes to such regulations that could have significant impact on industry participants. For example, in light of certain highly publicized safety issues regarding certain drugs that had received marketing approval,
the U.S. Congress has considered various proposals regarding drug safety, including some that would require additional safety studies and monitoring and could make drug development more costly. We are unable to predict what additional legislation or
regulation, if any, relating to safety or other aspects of drug development may be enacted in the future or what effect such legislation or regulation would have on our business. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>We are exposed to an increased risk of product liability claims. </I></B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The testing, marketing and sales of medical products entails an inherent risk of allegations of product liability. In the past, we were party
to product liability claims filed against Genentech Inc. and, even though Genentech agreed to indemnify us in connection with these matters and these matters have been settled, there can be no assurance other products liability lawsuits will not
result in liability to us or that our insurance or contractual arrangements will </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-25 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
provide us with adequate protection against such liabilities. In the event of one or more large, unforeseen awards of damages against us, our product liability insurance may not provide adequate
coverage. A significant product liability claim for which we were not covered by insurance or indemnified by a third party would have to be paid from cash or other assets, which could have an adverse effect on our business and the value of our
common stock. To the extent we have sufficient insurance coverage, such a claim would result in higher subsequent insurance rates. In addition, product liability claims can have various other ramifications, including loss of future sales
opportunities, increased costs associated with replacing products, a negative impact on our goodwill and reputation, and divert our management&#146;s attention from our business, each of which could also adversely affect our business and operating
results. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>The loss of key personnel, including our Chief Executive Officer, could delay or prevent achieving our objectives. </I></B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Our research, product development and business efforts could be affected adversely by the loss of one or more key members of our scientific or
management staff, particularly our executive officers: John Varian, our Chief Executive Officer; Patrick J. Scannon, M.D., Ph.D., our Executive Vice President and Chief Scientific Officer; Fred Kurland, our Vice President, Finance, Chief Financial
Officer and Secretary; Paul D. Rubin, M.D., our Senior Vice President, Research and Development and Chief Medical Officer; and Tom Klein, our Vice President and Chief Commercial Officer. We currently do not have key person insurance on any of our
employees. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>Our ability to use our net operating loss carry-forwards and other tax attributes will be substantially limited by Section&nbsp;382 of
the U.S. Internal Revenue Code. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Section&nbsp;382 of the U.S. Internal Revenue Code of 1986, as amended, generally limits the
ability of a corporation that undergoes an &#147;ownership change&#148; to utilize its net operating loss carry-forwards (&#147;NOLs&#148;) and certain other tax attributes against any taxable income in taxable periods after the ownership change.
The amount of taxable income in each taxable year after the ownership change that may be offset by pre-change NOLs and certain other pre-change tax attributes is generally equal to the product of (a)&nbsp;the fair market value of the
corporation&#146;s outstanding shares (or, in the case of a foreign corporation, the fair market value of items treated as connected with the conduct of a trade or business in the United States) immediately prior to the ownership change and
(b)&nbsp;the long-term tax exempt rate (i.e., a rate of interest established by the U.S. Internal Revenue Service (&#147;IRS&#148;) that fluctuates from month to month). In general, an &#147;ownership change&#148; occurs whenever the percentage of
the shares of a corporation owned, directly or indirectly, by &#147;5-percent shareholders&#148; (within the meaning of Section&nbsp;382 of the Internal Revenue Code) increases by more than 50 percentage points over the lowest percentage of the
shares of such corporation owned, directly or indirectly, by such &#147;5-percent shareholders&#148; at any time over the preceding three years. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Based on an analysis under Section&nbsp;382 of the Internal Revenue Code (which subjects the amount of pre-change NOLs and certain other
pre-change tax attributes that can be utilized to an annual limitation), the Company experienced ownership changes in 2009 and 2012 which substantially limit the future use of our pre-change NOLs and certain other pre-change tax attributes per year.
As of September&nbsp;30, 2014, the Company has excluded the NOLs and R&amp;D credits that will expire as a result of the annual limitations. To the extent that the Company does not utilize its carry-forwards within the applicable statutory
carry-forward periods, either because of Section&nbsp;382 limitations or the lack of sufficient taxable income, the carry-forwards will also expire unused. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>Because we are a relatively small biopharmaceutical company with limited resources, we may not be able to attract and retain qualified personnel.
</I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Our success in developing marketable products and achieving a competitive position will depend, in part, on our ability to
attract and retain qualified scientific and management personnel, particularly in areas requiring specific technical, scientific or medical expertise. We had approximately 180 employees as of October&nbsp;31, 2014. We may require additional
experienced executive, accounting, research and development, legal, administrative and other personnel from time to time in the future. There is intense competition for the services of these personnel, especially in California. Moreover, we expect
that the high cost of living in the San Francisco Bay Area, where our headquarters and manufacturing facilities are located, may impair our ability to attract and retain employees in the future. If we do not succeed in attracting new personnel and
retaining and motivating existing personnel, our operations may suffer and we may be unable to implement our current initiatives or grow effectively. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-26 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>Our business and operations would suffer in the event of system failures. </I></B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Despite the implementation of security measures, our internal computer systems and those of our current and any future collaborators,
licensees, suppliers, contractors and consultants are vulnerable to damage from cyber-attacks, computer viruses, unauthorized access, natural disasters, terrorism, war and telecommunication and electrical failures. We could experience failures in
our information systems and computer servers, which could be the result of a cyber-attack and could result in an interruption of our normal business operations and require substantial expenditure of financial and administrative resources to remedy.
System failures, accidents or security breaches can cause interruptions in our operations and can result in a material disruption of our development programs, commercialization activities and other business operations. The loss of clinical trial
data from completed or future clinical trials could result in delays in our regulatory approval efforts and significantly increase our costs to recover or reproduce the data. Similarly, we rely on third parties to supply components for and
manufacture our product and product candidates, conduct clinical trials of our product candidates, and similar events relating to their computer systems could also have a material adverse effect on our business. To the extent that any disruption or
security breach were to result in a loss of, or damage to, our data or applications, or inappropriate disclosure of confidential or proprietary information, we could incur liability and the development of gevokizumab or any of our other product
candidates could be delayed or otherwise adversely affected. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>Calamities, power shortages or power interruptions at our Berkeley headquarters and
manufacturing facility could disrupt our business and adversely affect our operations. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Our principal operations are located in
Northern California, including our corporate headquarters and manufacturing facility in Berkeley, California. This location is in an area of seismic activity near active earthquake faults. Any earthquake, terrorist attack, fire, power shortage or
other calamity affecting our facilities may disrupt our business and could have material adverse effect on our business and results of operations. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>We have a significant stockholder, which may limit other stockholders&#146; ability to influence corporate matters and may give rise to conflicts of
interest. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Entities controlled by Felix J. Baker and Julian C. Baker beneficially own approximately 24.6% of our outstanding
common stock as of December&nbsp;4, 2014, which includes warrants to purchase approximately 7.6&nbsp;million shares of XOMA&#146;s common stock at an exercise price of $1.76 per share. On July&nbsp;19, 2012, our Board of Directors elected Kelvin
Neu, M.D., to serve on our Board of Directors. Dr.&nbsp;Neu is a Managing Director at Baker Bros. Advisors, LLC, an entity controlled by Felix J. Baker and Julian C. Baker. Accordingly, these entities may exert significant influence over us and any
action requiring the approval of the holders of our stock, including the election of directors and approval of significant corporate transactions. In addition, on June&nbsp;12, 2014 we entered into a registration rights agreement with entities
affiliated with Felix J. Baker and Julian C. Baker, pursuant to which we subsequently filed a registration statement to register for resale the shares of our common stock (including shares issuable upon the exercise of warrants) held by these
entities. Furthermore, conflicts of interest could arise in the future between us, on the one hand, and these entities, on the other hand, concerning potential competitive business activities, business opportunities, the issuance of additional
securities and other matters. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>Our organizational documents contain provisions that may prevent transactions that could be beneficial to our
stockholders and may insulate our management from removal. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Our charter and by-laws: </P>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">require certain procedures to be followed and time periods to be met for any stockholder to propose matters to be considered at annual meetings of stockholders, including nominating directors for election at those
meetings; and </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">authorize our Board of Directors to issue up to 1,000,000 shares of preferred stock without stockholder approval and to set the rights, preferences and other designations, including voting rights, of those shares as the
Board of Directors may determine. </TD></TR></TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-27 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In addition, we are subject to the provisions of Section&nbsp;203 of the Delaware General
Corporation Law (the &#147;DGCL&#148;), that may prohibit large stockholders, in particular those owning 15% or more of our outstanding common stock, from merging or combining with us. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">These provisions of our organizational documents and the DGCL, alone or in combination with each other, may discourage transactions involving
actual or potential changes of control, including transactions that otherwise could involve payment of a premium over prevailing market prices to holders of common stock, could limit the ability of stockholders to approve transactions that they may
deem to be in their best interests, and could make it considerably more difficult for a potential acquirer to replace management. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Risks Relating to
this Offering </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>You will experience immediate and substantial dilution in the net tangible book value per share of the common stock you purchase
and may also experience further dilution. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Since the price per share of our common stock being offered is substantially higher
than the net tangible book value per share of our common stock, you will suffer substantial dilution in the net tangible book value of the common stock you purchase in this offering. Based on the&nbsp;public offering price of $&nbsp;4.94 per
share,&nbsp;if you purchase common stock in this offering, you will suffer immediate and substantial dilution of $&nbsp;4.77&nbsp;per share in the net tangible book value of the common stock. See &#147;Dilution&#148; below for a more detailed
discussion of the dilution you will incur if you purchase common stock in this offering. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">To the extent that outstanding options or
warrants are exercised or restricted stock units vest, you will experience further dilution. As of September&nbsp;30, 2014, there were 7,784,141 stock options outstanding, with a weighted average exercise price of $8.13 per share, 2,661,846
restricted stock units outstanding, and warrants outstanding to purchase 347,826 shares of common stock at an exercise price of $19.50 per share, 1,260,000 shares of common stock at an exercise price of $10.50 per share, 39,346 shares of common
stock at an exercise price of $3.54 per share, 12,109,418 shares of common stock at an exercise price of $1.76 per share, and 263,158 shares of common stock at an exercise price of $1.14 per share. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In addition, we may choose to raise additional capital due to market conditions or strategic considerations even if we believe we have
sufficient funds for our current or future operating plans. To the extent that additional capital is raised through the sale of equity or convertible debt securities, the issuance of these securities could result in further dilution to our
stockholders. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>We may issue additional equity securities and thereby materially and adversely affect the price of our common stock. </I></B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We are authorized to issue, without stockholder approval, 1,000,000 shares of preferred stock, of which none were issued and outstanding as of
the date of this offering, which may give other stockholders dividend, conversion, voting, and liquidation rights, among other rights, which may be superior to the rights of holders of our common stock. In April 2011, the 2,959 Series B convertible
preference shares previously issued to Genentech were converted by Genentech into 254,560 shares of common stock. In addition, we are authorized to issue, generally without stockholder approval, up to 138,666,666 shares of common stock, of
which&nbsp;92,701,155 were issued and outstanding as of September&nbsp;30, 2013. If we issue additional equity securities, the price of our common stock may be materially and adversely affected. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">On March&nbsp;9, 2012, we completed an underwritten public offering of 29,669,154 shares of our common stock, and accompanying warrants to
purchase one half of a share of common stock for each share purchased, at a public offering price of $1.32 per share. Total gross proceeds from the offering were approximately $39.2 million, before deducting under writing discounts and commissions
and estimated offering expenses totaling approximately $3.0 million. The warrants, which represented the right to acquire an aggregate of up to 14,834,577 shares of common stock, are immediately exercisable and have a five-year term and an exercise
price of $1.76 per share. As of September&nbsp;30, 2013, 13,673,183 of these warrants were outstanding. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-28 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In addition, funding from collaboration partners and others has in the past and may in the future
involve issuance by us of our shares of common stock. We cannot be certain how the purchase price of such shares, the relevant market price or premium, if any, will be determined or when such determinations will be made. Any such issuance could
result in dilution in the value of our issued and outstanding shares. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>Our share price may be volatile and there may not be an active trading market
for our common stock. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">There can be no assurance that the market price of our common stock will not decline below its present
market price or that there will be an active trading market for our common stock. The market prices of biotechnology companies have been and are likely to continue to be highly volatile. Fluctuations in our operating results and general market
conditions for biotechnology stocks could have a significant impact on the volatility of our common stock price. We have experienced significant volatility in the price of our common stock. From January&nbsp;1, 2014 through December&nbsp;8, 2014,
the share price of our common stock has ranged from a high of $9.57 to a low of $3.42. Factors contributing to such volatility include, but are not limited to: </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">results of preclinical studies and clinical trials; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the pace of enrollment in our clinical trials </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">information relating to the safety or efficacy of products or product candidates; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">developments regarding regulatory filings; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">announcements of new collaborations; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">failure to enter into collaborations; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">developments in existing collaborations; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">our funding requirements and the terms of our financing arrangements; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">technological innovations or new indications for our therapeutic products and product candidates; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">introduction of new products or technologies by us or our competitors; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">sales and estimated or forecasted sales of products for which we receive royalties, if any; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">government regulations; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">developments in patent or other proprietary rights; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the number of shares issued and outstanding; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the number of shares trading on an average trading day; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">announcements regarding other participants in the biotechnology and pharmaceutical industries; and </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">market speculation regarding any of the foregoing. </TD></TR></TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-29 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>Management will have broad discretion in determining how to use the proceeds of this offering. </I></B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We have not determined the amounts we plan to spend on any of the areas listed in &#147;Use of Proceeds&#148; below or the timing of such
expenditures. Accordingly, the amount and timing of our actual expenditures will depend on numerous factors, including the progress of our research and development activities and clinical trials and the amount of cash&nbsp;generated by our
operations.&nbsp;As a result, our management will have broad discretion to allocate the net proceeds from this offering, and may spend the proceeds in ways with which our stockholders may not agree. Pending application of the net proceeds as
described in &#147;Use of Proceeds&#148;, we intend to invest the net proceeds of the offering in short-term, interest-bearing securities, investment grade securities, certificates of deposit or direct or guaranteed obligations of the U.S.
government. These investments may not yield a favorable return to our stockholders. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>A substantial number of shares of our common stock and warrants
to purchase our common stock may be sold in this offering, which could cause the price of our common stock to decline. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In this
offering we will sell&nbsp;8,097,165 shares of our common stock and warrants to purchase 8,097,165 shares of our common stock, or approximately 15.1% of our outstanding common stock as of September&nbsp;30, 2014.&nbsp;This sale and any future sales
of a substantial number of shares of our common stock in the public market, or the perception that such sales may occur, could adversely affect the price of our common stock. We cannot predict the effect, if any, that market sales of those shares of
common stock or the availability of those shares of common stock for sale will have on the market price of our common stock. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>There is no public
market for the warrants in this offering. </I></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">There is no established public trading market for the warrants being offered in this
offering, and we do not expect a market to develop. In addition, we do not intend to apply for listing of the warrants on any national securities exchange or other nationally recognized trading system. Without an active market, the liquidity of the
warrants will be limited. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-30 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="supptoc834930_4"></A>FORWARD-LOOKING INFORMATION </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Certain statements contained in this prospectus supplement and the accompanying prospectus, including the documents incorporated by reference
therein, related to the anticipated size of clinical trials, the anticipated timing of initiation of clinical trials, the expected availability of clinical trial results, the sufficiency of our cash resources, the estimated costs of clinical trials
and the amounts of certain revenues and certain costs in comparison to prior years, or that otherwise relate to future periods, are forward-looking statements within the meaning of Section&nbsp;27A of the Securities Act and Section&nbsp;21E of the
Securities Exchange Act of 1934, as amended (the &#147;Exchange Act&#148;). The words &#147;believe,&#148; &#147;may,&#148; &#147;estimate,&#148; &#147;continue,&#148; &#147;anticipate,&#148; &#147;intend,&#148; &#147;expect,&#148;
&#147;predict,&#148; &#147;potential&#148; and similar expressions are intended to identify forward-looking statements.&nbsp;These statements are based on assumptions that may not prove accurate. Actual results could differ materially from those
anticipated due to certain risks inherent in the biotechnology industry and for companies engaged in the development of new products in a regulated market. Among other things: our product candidates are still being developed, and we will require
substantial funds to continue development which may not be available; we have sustained losses in the past and we expect to sustain losses in the future; we are substantially dependent on Servier for the development and commercialization of
gevokizumab and for other aspects of our business; we have received negative results from certain of our clinical trials, and the pace of certain ongoing trials has not always been what was initially anticipated, and we face uncertain results of
other clinical trials of our product candidates; if our therapeutic product candidates do not receive regulatory approval, neither our third-party collaborators, our contract manufacturers nor we will be able to manufacture and market them; we may
not obtain orphan drug exclusivity or we may not receive the full benefit of orphan drug exclusivity even if we obtain such exclusivity; even once approved, a product may be subject to additional testing or significant marketing restrictions, its
approval may be withdrawn or it may be voluntarily taken off the market; we may not be successful in commercializing our products, which could also affect our development efforts; we are subject to various state and federal healthcare related laws
and regulations that may impact the commercialization of ACEON or our product candidates and could subject us to significant fines and penalties; and certain of our technologies are in-licensed from third parties, so our capabilities using them are
restricted and subject to additional risks.&nbsp;These and other risks, including those related to current economic and financial market conditions, are described in more detail in &#147;Risk Factors&#148; above and the additional risk factors
contained in our most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. We undertake no obligation to publicly update any forward-looking statements, regardless of any new information, future events or other occurrences. We
advise you, however, to consult any additional disclosures we make in our reports to the SEC on Forms 10-K, 10-Q and 8-K. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-31 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="supptoc834930_5"></A>USE OF PROCEEDS </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We estimate the net proceeds from&nbsp;the sale of the securities offered pursuant to this prospectus, excluding the proceeds, if any, from
the exercise of the warrants issued in this offering, will be approximately $37.7 million, after deducting placement agent&#146;s fees and all estimated offering expenses payable by us. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We currently intend to use the net proceeds from this offering for continued development, preclinical testing and clinical studies related to
gevokizumab and our XMet platform. We intend to use the remainder of the net proceeds for general research and development, business development and other corporate purposes as determined by our management. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">While we have estimated the particular uses for the net proceeds of this offering, the amount and timing of our actual expenditures will
depend on numerous factors, including the progress of our research and development activities and clinical trials and the amount of cash generated by our operations. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">As a result, our management will retain broad discretion in the allocation and use of the net proceeds of this offering, and investors will be
relying on the judgment of our management with regard to the use of these net proceeds. Pending application of the net proceeds for the specified purposes as described above, we expect to invest the net proceeds in short-term, interest-bearing
securities, investment grade securities, certificates of deposit or direct or guaranteed obligations of the U.S. government. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-32 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="supptoc834930_6"></A>DILUTION </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Our net tangible book value as of September&nbsp;30, 2014, was approximately $(18.1) million, or $(0.17) per share of common stock. Net
tangible book value per share is determined by dividing our total tangible assets, less total liabilities, by the number of our shares of common stock outstanding as of September&nbsp;30, 2014. Dilution in net tangible book value per share
represents the difference between the amount per share paid by purchasers of common stock in this offering and the net tangible book value per share of our common stock immediately after this offering. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">After giving effect to the sale of&nbsp;8,097,165 of the common shares and warrants to purchase the same number of common stock in this
offering at a public offering price of $4.94 per one share and one warrant,&nbsp;and after deducting the placement agent&#146;s fees and estimated offering expenses payable by us, our as adjusted net tangible book value as of September&nbsp;30,
2014, would have been approximately $&nbsp;19.6 million, or $0.17 per share. This represents an immediate increase in net tangible book value of $&nbsp;0.34 per share to existing stockholders and immediate dilution in net tangible book value of
$&nbsp;4.77&nbsp;per share to new investors participating in this offering. The following table illustrates this dilution on a per share basis: </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="76%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" ALIGN="center">


<TR>
<TD WIDTH="82%"></TD>
<TD VALIGN="bottom" WIDTH="5%"></TD>
<TD></TD>
<TD></TD>
<TD></TD>
<TD VALIGN="bottom" WIDTH="5%"></TD>
<TD></TD>
<TD></TD>
<TD></TD></TR>


<TR BGCOLOR="#cceeff" STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">Public offering price per share and accompanying warrant</P></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="bottom">$</TD>
<TD VALIGN="bottom" ALIGN="right">&nbsp;4.94</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">Net tangible book value per share as of September&nbsp;30, 2014</P></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom">$</TD>
<TD VALIGN="bottom" ALIGN="right">(0.17</TD>
<TD NOWRAP VALIGN="bottom">)&nbsp;</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD></TR>
<TR BGCOLOR="#cceeff" STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">Increase per share attributable to investors participating in this offering</P></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="bottom">$</TD>
<TD VALIGN="bottom" ALIGN="right">0.34</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="4"></TD>
<TD HEIGHT="8" COLSPAN="4"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">As adjusted net tangible book value per share after this offering</P></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="bottom">$</TD>
<TD VALIGN="bottom" ALIGN="right">0.17</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR BGCOLOR="#cceeff" STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">Dilution per share to investors participating in this offering</P></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="bottom">$</TD>
<TD VALIGN="bottom" ALIGN="right">4.77</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
</TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The foregoing table does not take into account further dilution to new investors that could occur upon the
exercise of outstanding options and warrants having a per share exercise price less than the per share offering price to the public in this offering or upon the vesting of outstanding restricted stock units., and assumes no exercise of the warrants
offered hereby. Investors that purchase common stock upon the exercise of the warrants offered hereby may experience dilution depending on our net tangible book value at the time of exercise. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The above discussion and table are based on 107,373,962 shares of common stock outstanding as of September&nbsp;30, 2014, and exclude
8,097,165 shares issuable upon the exercise of the warrants offered hereby and also exclude: </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">shares of common stock issuable upon the exercise of stock options outstanding, of which there were 7,784,141 outstanding as of September&nbsp;30, 2014, with a weighted average exercise price of $8.13 per share;
</TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">shares of common stock issuable upon the vesting of outstanding restricted stock units, of which there were 2,661,846 outstanding as of September&nbsp;30, 2014; </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">shares of common stock issuable upon the exercise of our outstanding warrants, of which there were warrants outstanding as of September&nbsp;30, 2014, to purchase 347,826 shares of common stock at an exercise price of
$19.50 per share, 1,260,000 shares of common stock at an exercise price of $10.50 per share, 39,346 shares of common stock at an exercise price of $3.54 per share, 12,109,418 shares of common stock at an exercise price of $1.76 per share, and
263,158 shares of common stock at an exercise price of $1.14 per share; and </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">6,193,109 shares of common stock not subject to stock awards and reserved for issuance under our equity incentive plans and 56,191 shares of common stock reserved for issuance under our employee stock purchase plan.
</TD></TR></TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-33 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="supptoc834930_7"></A>DESCRIPTION OF SECURITIES WE ARE OFFERING </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In this offering, we are offering 8,097,165&nbsp;shares of common stock and warrants to purchase an additional 8,097,165&nbsp;shares of common
stock. We are issuing a warrant to purchase one share of common stock at an exercise price of $7.90 per each share of our common stock. The shares of common stock and warrants are immediately separable and will be issued separately. This prospectus
also relates to the offering of shares of our common stock upon exercise, if any, of the warrants. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>Common Stock </I></B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The material terms and provisions of our common stock and each other class of our securities which qualifies or limits our common stock are
described under the caption &#147;Description of Capital Stock&#148; starting on page&nbsp;7 of the accompanying prospectus. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>Warrants </I></B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The warrants offered in this offering will be issued pursuant to a subscription agreement between each of the purchasers and us. You should
review a copy of the form of subscription agreement and the form of warrant, each of which has been filed by us as an exhibit to a Current Report on Form&nbsp;8-K filed with the Securities and Exchange Commission in connection with this offering,
for a complete description of the terms and conditions applicable to the warrants. The following is a brief summary of the material terms of the warrants and is subject in all respects to the provisions contained in the warrants. A form of the
warrant is attached hereto as Annex A for a complete description of the terms and conditions applicable to the warrants. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><I>Exercisability</I>. Holders may exercise the warrants at any time after the date of original issuance and at any time up to the date that
is two years after such date of issuance. The warrants will be exercisable, at the option of each holder, in whole or in part by delivering to us a duly executed exercise notice accompanied by payment in full for the number of shares of our common
stock purchased upon such exercise (except in the case of a cashless exercise as discussed below). Unless otherwise specified in the applicable warrant, except upon at least 61&nbsp;days&#146; prior notice from the holder to us, the holder will not
have the right to exercise any portion of the warrant if the holder (together with its affiliates) would beneficially own in excess of 4.99% of the number of shares of our common stock outstanding immediately after giving effect to the exercise, as
such percentage ownership is determined in accordance with the terms of the warrants. Any holder (together with its affiliates) beneficially owning in excess of 4.99% of the number of shares of our common stock outstanding on the date of issuance
would not be subject to the foregoing limitation on exercisability unless such holder (together with its affiliates) thereafter beneficially owns 4.99% (or a lesser percentage) of the number of shares of our common stock outstanding. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><I>Cashless Exercise</I>. If at any time during the warrant exercisability period during which the warrant shares cannot be sold pursuant to
an effective registration statement or an exemption from registration, the holders can effect a cashless exercise of the warrants (in whole or in part) by surrendering the warrants to us together with delivery to us of a duly executed exercise
notice, by canceling a portion of the warrant in payment of the purchase price payable in respect of the number of shares of our common stock purchased upon such exercise. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><I>Exercise Price</I>. The exercise price per share of common stock purchasable upon exercise of the warrants is $7.90 per share of common
stock being purchased. The exercise price is subject to appropriate adjustment in the event of stock dividends and distributions, stock splits, stock combinations, reclassifications or similar events affecting our common stock. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><I>Transferability</I>. Subject to applicable laws and the restriction on transfer set forth in the subscription agreements, the warrants may
be transferred at the option of the holders upon surrender of the warrants to us together with the appropriate instruments of transfer. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><I>Exchange Listing</I>.&nbsp;We do not plan on making an application to list the warrants on The NASDAQ Global Market, any national
securities exchange or other nationally recognized trading system. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-34 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><I>Fundamental Transactions</I>. In the event of any fundamental transaction, as described in the
warrants and generally including any capital reorganization, reclassification of our capital stock, consolidation or merger with another entity in which we are not the survivor, or the sale, transfer or other disposition of all or substantially all
of our assets to another entity, then we will use our commercially reasonable efforts to ensure that the holders of the warrants will thereafter have the right to receive upon exercise of the warrants such shares of stock, securities or assets as
would have been issuable or payable with respect to or in exchange for a number of shares of our common stock equal to the number of shares of our common stock issuable upon exercise of the warrants immediately prior to the fundamental transaction,
had the fundamental transaction not taken place, and appropriate provision will be made so that the provisions of the warrants (including, for example, provisions relating to the adjustment of the exercise price) will thereafter be applicable, as
nearly equivalent as may be practicable in relation to any share of stock, securities or assets deliverable upon the exercise of the warrants after the fundamental transaction. Notwithstanding the foregoing, upon election of the warrant holder, we
may be required to purchase the warrant from the holder by paying to the holder cash in an amount equal to the Black Scholes Value of the remaining unexercised portion of the warrant on the date of such fundamental transaction. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><I>Rights as a Stockholder</I>.&nbsp;Except as otherwise provided in the warrants or by virtue of such holder&#146;s ownership of shares of
our common stock, the holders of the warrants do not have the rights or privileges of holders of our common stock, including any voting rights, until they exercise their warrants. </P>
<P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="supptoc834930_8"></A>PLAN OF DISTRIBUTION </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Cowen and Company, LLC, which we refer to as the placement agent, has agreed to act as the exclusive placement agent in connection with this
offering subject to the terms and conditions of a placement agent agreement, dated December&nbsp;8, 2014. The placement agent is not purchasing or selling any shares and warrants offered by this prospectus supplement and the related prospectus, nor
is it required to arrange the purchase or sale of any specific number or dollar amount of the shares and warrants, but has agreed to use its commercially reasonable &#147;best efforts&#148; to arrange for the sale of all of the shares and warrants
offered hereby. We will enter into a subscription agreement directly with each investor in connection with this offering and we may not sell the entire amount of shares or warrants offered pursuant to this prospectus supplement and the related
prospectus. The public offering price of the shares and warrants offered hereby has been determined based upon arm&#146;s-length negotiations between each purchaser and us. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The placement agent proposes to arrange for the sale to one or more purchasers of the shares and warrants offered pursuant to this prospectus
supplement and the related prospectus through direct subscription agreements between each purchaser and us. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Commissions and Expenses </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We have agreed to pay the placement agent an aggregate cash placement fee equal to 5.00&nbsp;% of the gross proceeds in this offering. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The following table shows the combined per share and total cash placement agent&#146;s fees we will pay to the placement agent in connection
with the sale of the shares and Warrants offered pursuant to this prospectus supplement and the related prospectus assuming the purchase of all of the shares and Warrants offered hereby: </P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="68%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" ALIGN="center">


<TR>
<TD WIDTH="85%"></TD>
<TD VALIGN="bottom" WIDTH="5%"></TD>
<TD></TD>
<TD></TD>
<TD></TD></TR>


<TR BGCOLOR="#cceeff" STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">Per Share of Common Stock and Corresponding Warrant</P></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom">$</TD>
<TD VALIGN="bottom" ALIGN="right">0.247</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="4"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">Total</P></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom">$</TD>
<TD VALIGN="bottom" ALIGN="right">2,000,000</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
</TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Because there is no minimum offering amount required as a condition to closing in this offering, the actual
total placement agent fees, if any, are not presently determinable and may be substantially less than the maximum amount set forth above. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-35 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Our obligation to issue and sell shares and warrants to each purchaser is subject to the
conditions set forth in a placement agent agreement, which may be waived by us at our discretion. A purchaser&#146;s obligation to purchase shares and warrants is subject to the conditions set forth in his, her or its subscription agreement as well,
which may also be waived. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We currently anticipate that the sale of the shares and warrants will be completed on or about
December&nbsp;12, 2014. We estimate the total offering expenses of this offering that will be payable by us, excluding the placement agent&#146;s fees, will be approximately $250,000, which includes legal, accounting and printing costs, and various
other fees. At the closing, The Depository Trust Company will credit the shares of common stock to the respective accounts of each purchaser. We will mail warrants directly to each investor at the respective addresses set forth in his, her or its
subscription agreement with us. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Indemnification </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We have agreed to indemnify the placement agent against liabilities under the Securities Act, or contribute to payments that the placement
agent may be required to make in that respect. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Lock-up Agreement </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We&nbsp;have agreed we will not amend, modify or change the terms of the warrants to acquire our common stock, or offer, sell, contract to
sell, pledge or otherwise dispose of, directly or indirectly, or file with the SEC a registration statement under the Securities Act relating to, any shares of our common stock or securities convertible into or exchangeable or exercisable for any
shares of our common stock, or publicly disclose the intention to make any offer, sale, pledge, disposition or filing, without the prior written consent of the placement agent for a period of 60 days after the date of this prospectus supplement. The
restrictions described in this paragraph do not apply in certain circumstances, including&nbsp;awards by us to purchase, or issuance by us of, shares of common stock pursuant to employee benefit plans existing on,&nbsp;upon the exercise, conversion
or exchange of convertible or exchangeable securities outstanding as of, the date of this prospectus supplement, or in connection with certain issuances by us&nbsp;as consideration in connection with any collaborations, acquisitions or strategic
transactions. However, in the event that either (1)&nbsp;during the last 17 days of the &#147;lock-up&#148; period, we release earnings results or material news or a material event relating to us occurs or (2)&nbsp;prior to the expiration of the
&#145;lock-up&#146; period, we announce that we will release earnings results during the 16-day period beginning on the last day of the &#145;lock-up&#146; period, then in either case the expiration of the &#145;lock-up&#148; will be extended until
the expiration of the 18-day period beginning on the date of the release of the earnings results or the occurrence of the material news or event, as applicable, unless the placement agent waives, in writing, such an extension. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Our executive officers and directors have agreed they will not offer, sell, contract to sell, pledge or otherwise dispose of, directly or
indirectly, any shares of our common stock or securities convertible into or exchangeable or exercisable for any shares of our common stock, enter into a transaction that would have the same effect, or enter into any swap, hedge or other arrangement
that transfers, in whole or in part, any of the economic consequences of ownership of our common stock, whether any of these transactions are to be settled by delivery of our common stock or other securities, in cash or otherwise, or publicly
disclose the intention to make any offer, sale, pledge or disposition, or to enter into any transaction, swap, hedge or other arrangement, without, in each case, the prior written consent of Cowen and Company, LLC for a period of 60 days after the
date of this prospectus supplement.&nbsp;The restrictions described in this paragraph do not apply to, subject to certain conditions, transfers of shares (i)&nbsp;as a <I>bona fide</I> gift or gifts or pledge, (ii)&nbsp;to an immediate family member
of such person or to a trust, the beneficiaries of which are exclusively such person and one or more immediate family members, (iii)&nbsp;with the prior written consent of Cowen and Company, LLC, (iv)&nbsp;in connection with the exercise of any
equity award granted to them that expires or is otherwise required to be exercised during the 60 day period to discharge tax obligations resulting from such exercise, (v)&nbsp;to us to discharge tax withholding obligations resulting from the vesting
or release of equity awards, or (vi)&nbsp;pursuant to any contract, instruction or plan that satisfies all of the requirements of Rule 10b5-1 under the Exchange Act that was established prior to the date of this offering. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-36 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Electronic Distribution </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">This prospectus supplement and the related prospectus may be made available in electronic format on websites or through other online services
maintained by the placement agent, or by an affiliate. Other than this prospectus supplement and the related prospectus, the information on the placement agent&#146;s website and any information contained in any other website maintained by the
placement agent is not part of this prospectus supplement and the related prospectus or the registration statement of which this prospectus supplement and the related prospectus forms a part, has not been approved and/or endorsed by us or the
placement agent, and should not be relied upon by investors. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The foregoing does not purport to be a complete statement of the terms and
conditions of the placement agency agreement and subscription agreement. A copy of the placement agent agreement and the form of subscription agreement with each purchaser are included as exhibits to our current report on Form 8-K that will be filed
with the SEC and incorporated by reference into the Registration Statement of which this prospectus supplement forms a part. See &#147;Where You Can Find More Information.&#148; </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Regulation M Restrictions </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The placement
agent may be deemed to be an underwriter within the meaning of Section&nbsp;2(a)(11) of the Securities Act, and any commissions received by it and any profit realized on the resale of the shares and Warrants sold by it while acting as a principal
might be deemed to be underwriting discounts or commissions under the Securities Act. As an underwriter, the placement agent would be required to comply with the requirements of the Securities Act and the Securities Exchange Act of 1934, as amended,
including, without limitation, Rule 415(a)(4) under the Securities Act and Rule 10b-5 and Regulation M under the Exchange Act. These rules and regulations may limit the timing of purchases and sales of shares and Warrants by the placement agent
acting as a principal. Under these rules and regulations, the placement agent: </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">must not engage in any stabilization activity in connection with our securities; and </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">must not bid for or purchase any of our securities or attempt to induce any person to purchase any of our securities, other than as permitted under the Exchange Act, until it has completed their participation in the
distribution. </TD></TR></TABLE> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Listing </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Our common stock is listed on The NASDAQ Global Market under the symbol &#147;XOMA.&#148; </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">There is no established public trading market for the warrants and we do not expect a market to develop. In addition, we do not intend to
apply for listing of the warrants on any national securities exchange. The Company will act as warrant agent with respect to the Warrants offered hereby. </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Other Relationships </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The placement agent
and its affiliates have provided and/or may in the future provide various investment banking, commercial banking and other financial services for us and our affiliates for which they have received and/or may in the future receive customary fees.
</P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-37 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="supptoc834930_9"></A>LEGAL MATTERS </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Certain legal matters with respect to the legality of the issuance of the securities offered by this prospectus will be passed upon for us by
Cooley LLP, Palo Alto, California. Proskauer Rose LLP, New York, New York, has acted as counsel for the placement agent in connection with certain legal matters related to this offering. </P>
<P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="supptoc834930_10"></A>EXPERTS </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Ernst&nbsp;&amp; Young LLP, independent registered public accounting firm, has audited our consolidated financial statements included in our
Annual Report on Form 10-K for the year ended December&nbsp;31, 2013, and the effectiveness of our internal control over financial reporting as of December&nbsp;31, 2013, as set forth in their reports, which are incorporated by reference in this
prospectus and elsewhere in the registration statement. Our financial statements are incorporated by reference in reliance on Ernst&nbsp;&amp; Young LLP&#146;s reports, given on their authority as experts in accounting and auditing. </P>
<P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="supptoc834930_11"></A>WHERE YOU CAN FIND MORE INFORMATION </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We are subject to the reporting requirements of the Exchange Act and file annual, quarterly and current reports, proxy statements and other
information with the SEC. You may read and copy these reports, proxy statements and other information at the SEC&#146;s public reference facilities at 100 F Street, N.E., Room 1580, Washington, D.C. 20549. You can request copies of these documents
by writing to the SEC and paying a fee for the copying cost. Please call the SEC at 1-800-SEC-0330 for more information about the operation of the public reference facilities. SEC filings are also available at the SEC&#146;s website at
http://www.sec.gov. Our common stock is listed on The NASDAQ Global Market, and you can read and inspect our filings at the offices of The NASDAQ Stock Market at 1735 K Street, Washington, D.C. 20006. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">This prospectus supplement and the accompanying prospectus are only part of a registration statement on Form S-3 that we have filed with the
SEC under the Securities Act and therefore omit certain information contained in the registration statement. We have also filed exhibits and schedules with the registration statement that are excluded from this prospectus supplement and the
accompanying prospectus, and you should refer to the applicable exhibit or schedule for a complete description of any statement referring to any contract or other document. You may inspect a copy of the registration statement, including the exhibits
and schedules, without charge, at the public reference room or obtain a copy from the SEC upon payment of the fees prescribed by the SEC. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We also maintain a website at http://www.xoma.com, through which you can access our SEC filings. The information set forth on our website is
not part of this prospectus supplement. </P> <P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="supptoc834930_12"></A>INCORPORATION OF DOCUMENTS BY REFERENCE </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The SEC allows us to &#147;incorporate by reference&#148; the information we file with the SEC. This permits us to disclose important
information to you by referring to these filed documents. Any information referred to in this way is considered part of this prospectus supplement. The information incorporated by reference is an important part of this prospectus supplement and the
accompanying prospectus, and information that we file later with the SEC will automatically update and supersede this information. We incorporate by reference the following documents that have been filed with the SEC (other than information
furnished under Item&nbsp;2.02 or Item&nbsp;7.01 of Form 8-K and all exhibits related to such items): </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">our annual report on Form 10-K for the year ended December&nbsp;31, 2013, filed with the SEC on March&nbsp;12, 2014, including the information specifically incorporated by reference therein from our definitive proxy
statement on Schedule 14A, filed on April&nbsp;11, 2014; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">our quarterly reports on Form 10-Q for the fiscal quarters ended March&nbsp;31, 2014,&nbsp;June&nbsp;30, 2014 and September&nbsp;30, 2014 filed with the SEC on May&nbsp;7, 2014,&nbsp;August&nbsp;7, 2014 and
November&nbsp;6, 2014, respectively; </TD></TR></TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-38 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>


<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">our quarterly report on Form 10-Q/A for the fiscal quarters ended March&nbsp;31, 2014 filed with the SEC on August&nbsp;7, 2014; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">our current reports on Form 8-K, filed with the SEC on January&nbsp;8, 2014,&nbsp;May&nbsp;16, 2014,&nbsp;May&nbsp;28, 2014,&nbsp;June&nbsp;12, 2014 and August&nbsp;7, 2014; and </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the description of our capital stock included under the caption &#147;Description of Capital Stock&#148; in the prospectus dated December&nbsp;16, 2011, which was filed on December&nbsp;19, 2011, and is part of our
registration statement on Form S-4/A filed on December&nbsp;13, 2011 (registration no. 333-177165), including any amendment or report for the purpose of updating such description. </TD></TR></TABLE>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Any information in any of the foregoing documents will automatically be deemed to be modified or superseded to the extent that information in
this prospectus supplement and the accompanying prospectus or in a later filed document that is incorporated or deemed to be incorporated herein by reference modifies or replaces such information. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We also incorporate by reference any future filings (other than current reports furnished under Item&nbsp;2.02 or Item&nbsp;7.01 of Form 8-K
and exhibits filed on such form that are related to such items) made with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this prospectus supplement and prior to the termination of the offering of the
securities made by this prospectus supplement and the accompanying prospectus. Information in such future filings updates and supplements the information provided in this prospectus supplement and the accompanying prospectus. Any statements in any
such future filings will automatically be deemed to modify and supersede any information in any document we previously filed with the SEC that is incorporated or deemed to be incorporated herein by reference to the extent that statements in the
later filed document modify or replace such earlier statements. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We will provide, upon written or oral request, without charge to each
person, including any beneficial owner, to whom a copy of this prospectus supplement and the accompanying prospectus is delivered, a copy of any or all of the information incorporated herein by reference (exclusive of exhibits to such documents
unless such exhibits are specifically incorporated by reference herein). You may request in writing or orally a copy of these filings, at no cost, by writing or telephoning us at the following address: </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">XOMA Corporation </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">2910 Seventh
Street </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">Berkeley, California 94710 </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">(510) 204-7200 </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S-39 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><A NAME="supptoc834930_13"></A>ANNEX A </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>XOMA CORPORATION </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>WARRANT TO PURCHASE COMMON STOCK </B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Warrant
No.: &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Number of Shares of Common
Stock: &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Date of Issuance:
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;, 2014 (the &#147;<B>Issuance Date</B>&#148;) </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">XOMA Corporation, a Delaware corporation (the &#147;<B>Company</B>&#148;), hereby certifies that, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged,
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;, the
registered holder hereof or its permitted assigns (the &#147;<B>Holder</B>&#148;), is entitled, subject to the terms set forth below, to purchase from the Company, at the Exercise Price (as defined below) then in effect, upon exercise of this
Warrant to Purchase Common Stock (including any Warrants to Purchase Common Stock issued in exchange, transfer or replacement hereof, the &#147;<B>Warrant</B>&#148;), at any time or times on or after the date hereof (the &#147;<B>Exercisability
Date</B>&#148;), but not after 11:59 p.m., New York time, on the Expiration Date (as defined below),
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;)<SUP
STYLE="font-size:85%; vertical-align:top">1</SUP> fully paid nonassessable shares of Common Stock (as defined below) (the &#147;<B>Warrant Shares</B>&#148;). Except as otherwise defined herein, capitalized terms in this Warrant shall have the
meanings set forth in Section&nbsp;16. This Warrant is the Warrant to purchase Common Stock (this &#147;<B>Warrant</B>&#148;) issued pursuant to (i)&nbsp;Section&nbsp;2 of that certain Subscription Agreement (the &#147;<B>Subscription
Agreement</B>&#148;), dated as of December 8, 2014 (the &#147;<B>Subscription Date</B>&#148;), by and between the Company and the Holder (the &#147;<B>Subscription Agreement</B>&#148;) and (ii)&nbsp;certain prospectus supplement dated December 8,
2014 and accompanying prospectus (collectively, the &#147;<B>Prospectus</B>&#148;) that forms a part of the Company&#146;s Registration Statement on Form S-3 (File number&nbsp;333-191078) (the &#147;<B>Registration Statement</B>&#148;). </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">1. <U>EXERCISE OF WARRANT</U>. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(a) <U>Mechanics of Exercise</U>. Subject to the terms and conditions hereof, this Warrant may be exercised by the Holder on any day on or
after the Exercisability Date, in whole or in part, by delivery of a written notice, in the form attached hereto as <U>Exhibit A</U> (the &#147;<B>Exercise Notice</B>&#148;), of the Holder&#146;s election to exercise this Warrant. Within one
(1)&nbsp;day following the Exercise Notice, the Holder shall make payment to the Company of an amount equal to the applicable Exercise Price multiplied by the number of Warrant Shares as to which this Warrant is being exercised (the
&#147;<B>Aggregate Exercise Price</B>&#148;) in cash or by wire transfer of immediately available funds, or provided the conditions for cashless exercise set forth in Section&nbsp;1(d) are satisfied, by notifying the Company that this Warrant is
being exercised pursuant to a Cashless Exercise (as defined in Section&nbsp;1(d)). The Holder shall not be required to deliver the original Warrant in order to effect an exercise hereunder. Execution and delivery of the Exercise Notice with respect
to less than all of the Warrant Shares shall have the same effect as cancellation of the original Warrant and issuance of a new Warrant evidencing the right to purchase the remaining number of Warrant Shares. On or before the first (1<SUP
STYLE="font-size:85%; vertical-align:top">st</SUP>)&nbsp;Business Day following the date on which the Company has received the Exercise Notice, the Company shall transmit by facsimile an acknowledgment of confirmation of receipt of the Exercise
Notice to the Holder and the Company&#146;s transfer agent (the &#147;<B>Transfer Agent</B>&#148;). On or before the third (3<SUP STYLE="font-size:85%; vertical-align:top">rd</SUP>)&nbsp;Business Day following the date on which the Company has
received the Exercise Notice (the &#147;<B>Share Delivery Date</B>&#148;), the Company shall (X)&nbsp;provided that the Transfer Agent is participating in The Depository Trust Company (&#147;<B>DTC</B>&#148;) Fast Automated Securities Transfer
Program, upon the request of the Holder, credit such aggregate number of Warrant Shares to which the Holder is entitled pursuant to such exercise to the Holder&#146;s or its designee&#146;s balance account with DTC through its Deposit Withdrawal
Agent Commission system, or (Y)&nbsp;if the Transfer Agent is not participating in the DTC Fast Automated Securities Transfer Program, issue and dispatch by overnight courier to the address as specified in the Exercise Notice, a certificate,
registered in the Company&#146;s share register in the name of the Holder or its designee, for the number of shares of Common Stock to which the Holder is entitled pursuant to such exercise. Upon delivery of the Exercise Notice, the Holder shall be
deemed for all corporate purposes to have become the holder of record of the Warrant Shares with respect to which this Warrant has been exercised, irrespective of the date such Warrant Shares are credited to the Holder&#146;s DTC account or the date
of delivery of the certificates evidencing such </P> <P STYLE="line-height:8.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1px solid #000000;width:10%">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="2%" VALIGN="top" ALIGN="left"><SUP STYLE="font-size:85%; vertical-align:top">1</SUP>&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE="font-family:Times New Roman; font-size:10pt">Insert a number of shares equal to the number of shares of Common Stock purchased under the Subscription Agreement.
</P></TD></TR></TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">A-1 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
Warrant Shares, as the case may be. If this Warrant is submitted in connection with any exercise pursuant to this Section&nbsp;1(a) and the number of Warrant Shares represented by this Warrant
submitted for exercise is greater than the number of Warrant Shares being acquired upon an exercise, then the Company shall as soon as practicable and in no event later than three Business Days after any exercise and at its own expense, issue a new
Warrant (in accordance with Section&nbsp;7(d)) representing the right to purchase the number of Warrant Shares purchasable immediately prior to such exercise under this Warrant, less the number of Warrant Shares with respect to which this Warrant is
exercised. No fractional shares of Common Stock are to be issued upon the exercise of this Warrant, but rather the number of shares of Common Stock to be issued shall be rounded up to the nearest whole number. The Company shall pay any and all taxes
which may be payable with respect to the issuance and delivery of Warrant Shares upon exercise of this Warrant; <U>provided</U>, <U>however</U>, that the Company shall not be required to pay any tax which may be payable in respect of any transfer
involved in the registration of any certificates for Warrant Shares or Warrants in a name other than that of the Holder or an affiliate thereof. The Holder shall be responsible for all other tax liability that may arise as a result of holding or
transferring this Warrant. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(b) <U>Exercise Price</U>. For purposes of this Warrant, &#147;<B>Exercise Price</B>&#148; means $7.90,
subject to adjustment as provided herein. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(c) <U>Company&#146;s Failure to Timely Deliver Securities</U>. If the Company shall fail for
any reason or for no reason to issue to the Holder on or prior to the Share Delivery Date in compliance with the terms of this Section&nbsp;1, a certificate for the number of shares of Common Stock to which the Holder is entitled and register such
shares of Common Stock on the Company&#146;s share register or to credit the Holder&#146;s balance account with DTC for such number of shares of Common Stock to which the Holder is entitled upon the Holder&#146;s exercise of this Warrant, and if on
or after such Trading Day the Holder purchases (in an open market transaction or otherwise) shares of Common Stock to deliver in satisfaction of a sale by the Holder of shares of Common Stock issuable upon such exercise that the Holder anticipated
receiving from the Company (a &#147;<B>Buy-In</B>&#148;), then the Company shall, within three (3)&nbsp;Business Days after the Holder&#146;s request and in the Holder&#146;s discretion, either (i)&nbsp;pay cash to the Holder in an amount equal to
the Holder&#146;s total purchase price (including brokerage commissions, if any) for the shares of Common Stock so purchased (the &#147;<B>Buy-In Price</B>&#148;), at which point the Company&#146;s obligation to deliver such certificate (and to
issue such Warrant Shares or credit such Holder&#146;s balance account at DTC) shall terminate, or (ii)&nbsp;promptly honor its obligation to deliver to the Holder a certificate or certificates representing such Warrant Shares or credit such
Holder&#146;s balance account at DTC and pay cash to the Holder in an amount equal to the excess (if any) of the Buy-In Price over the product of (A)&nbsp;such number of shares of Common Stock, times (B)&nbsp;the Closing Bid Price on the date of
exercise. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(d) <U>Cashless Exercise</U>. Notwithstanding anything contained herein to the contrary, if at the time of exercise hereof,
the Registration Statement is not effective for the issuance and resale of the Warrant Shares that are subject of the Exercise Notice (the &#147;<B>Unavailable Warrant Shares</B>&#148;), or an exemption from registration is not available for the
issuance and resale by the Holder of such Unavailable Warrant Shares, the Holder may, in its sole discretion, exercise this Warrant in whole or in part and, in lieu of making the cash payment otherwise contemplated to be made to the Company upon
such exercise in payment of the Aggregate Exercise Price, elect instead to receive upon such exercise the &#147;Net Number&#148; of shares of Common Stock determined according to the following formula (a &#147;<B>Cashless Exercise</B>&#148;): </P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="76%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" ALIGN="center">


<TR>
<TD></TD>
<TD VALIGN="bottom" WIDTH="1%"></TD>
<TD WIDTH="5%"></TD>
<TD VALIGN="bottom" WIDTH="1%"></TD>
<TD></TD>
<TD VALIGN="bottom" WIDTH="1%"></TD>
<TD WIDTH="7%"></TD>
<TD VALIGN="bottom" WIDTH="1%"></TD>
<TD WIDTH="84%"></TD></TR>


<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">Net&nbsp;Number</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">=</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman"><FONT STYLE="white-space:nowrap">(A&nbsp;x&nbsp;B)&nbsp;-&nbsp;(A&nbsp;x&nbsp;C)</FONT></P></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top"> <P STYLE="text-indent:4.00em; font-size:10pt; font-family:Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;D</P></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top"></TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="8"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top" COLSPAN="7">For purposes of the foregoing formula:</TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><DIV ALIGN="right">
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="92%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt">


<TR>
<TD WIDTH="1%"></TD>
<TD VALIGN="bottom" WIDTH="2%"></TD>
<TD WIDTH="97%"></TD></TR>


<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">A=</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">the total number of shares with respect to which this Warrant is then being exercised.</TD></TR></TABLE></DIV>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">A-2 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

<DIV ALIGN="right">
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="92%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt">


<TR>
<TD WIDTH="1%"></TD>
<TD VALIGN="bottom" WIDTH="2%"></TD>
<TD WIDTH="97%"></TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>

<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">B=</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">the arithmetic average of the Closing Sale Prices of the shares of Common Stock for the five (5) consecutive Trading Days ending on the date immediately preceding the date of the Exercise Notice.</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">C=</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">the Exercise Price then in effect for the applicable Warrant Shares at the time of such exercise.</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">D=</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">the Closing Sale Price on the date of the Exercise Notice.</TD></TR>
</TABLE></DIV> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(e) <U>Rule 144</U>. For purposes of Rule 144(d) promulgated under the Securities Act, as in effect on
the date hereof, it is intended that the Warrant Shares issued in a Cashless Exercise shall be deemed to have been acquired by the Holder, and the holding period for the Warrant Shares shall be deemed to have commenced, on the date this Warrant was
originally issued pursuant to the Subscription Agreement. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(f) <U>Disputes</U>. In the case of a dispute as to the determination of the
Exercise Price or the arithmetic calculation of the Warrant Shares, the Company shall promptly issue to the Holder the number of Warrant Shares that are not disputed. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(g) <U>Beneficial Ownership Limitation</U>. The Company shall not effect the exercise of this Warrant, and the Holder shall not have the
right to exercise this Warrant, to the extent that after giving effect to such exercise, such Holder (together with such Holder&#146;s affiliates) would beneficially own in excess of 4.99% (the &#147;<B>Maximum Percentage</B>&#148;) of the shares of
Common Stock outstanding immediately after giving effect to such exercise. For purposes of the foregoing sentence, the aggregate number of shares of Common Stock beneficially owned by such Person and its affiliates shall include the number of shares
of Common Stock issuable upon exercise of this Warrant with respect to which the determination of such sentence is being made, but shall exclude shares of Common Stock which would be issuable upon (i)&nbsp;exercise of the remaining, unexercised
portion of this Warrant beneficially owned by such Person and its affiliates and (ii)&nbsp;exercise or conversion of the unexercised or unconverted portion of any other securities of the Company beneficially owned by such Person and its affiliates
(including, without limitation, any convertible notes or convertible preferred stock or warrants) subject to a limitation on conversion or exercise analogous to the limitation contained herein. Except as set forth in the preceding sentence, for
purposes of this paragraph, beneficial ownership shall be calculated in accordance with Section&nbsp;13(d) of the Securities Exchange Act of 1934, as amended (the &#147;<B>Exchange Act</B>&#148;), it being acknowledged that the Company is not
representing to the Holder that such calculation is in compliance with Section&nbsp;13(d) of the Exchange Act, and the Holder is solely responsible for any schedules required to be filed in accordance therewith. For purposes of this Warrant, in
determining the number of outstanding shares of Common Stock, the Holder may rely on the number of outstanding shares of Common Stock as reflected in (1)&nbsp;the Company&#146;s most recent Form 10-K, Form 10-Q, Current Report on Form 8-K or other
public filing with the Securities and Exchange Commission, as the case may be, (2)&nbsp;a more recent public announcement by the Company or (3)&nbsp;any other notice by the Company or the Transfer Agent setting forth the number of shares of Common
Stock outstanding. For any reason at any time, upon the written request of the Holder, the Company shall within one (1)&nbsp;Business Day confirm in writing to the Holder the number of shares of Common Stock then outstanding. In any case, the number
of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Company, including the Warrants, by the Holder and its affiliates since the date as of which such number of outstanding
shares of Common Stock was reported. By written notice to the Company, the Holder may from time to time increase or decrease the Maximum Percentage to any other percentage not in excess of 9.99% or less than 4.99% specified in such notice; provided
that (i)&nbsp;any such increase will not be effective until the sixty-first (61st)&nbsp;day after such notice is delivered to the Company, and (ii)&nbsp;any such increase or decrease will apply only to the Holder and not to any other holder of the
Warrants. For the avoidance of doubt, to the extent the limitation set forth in this Section&nbsp;1(g) applies, the determination (i)&nbsp;of whether the exercise of this Warrant may be effected (vis-a-vis other Options or Convertible Securities
owned by the Holder or any of its Affiliates) and (ii)&nbsp;of which such Options or Convertible Securities shall be convertible, exercisable or exchangeable (as the case may be, as among all such securities owned by the Holder) shall, subject to
such Maximum Percentage limitation, be determined on the basis of the first submission to the Company for conversion, exercise or exchange (as the case may be). The provisions of this paragraph shall be construed and implemented in a manner other
than in strict conformity with the terms of this Section&nbsp;1(g) to correct this paragraph (or any portion hereof) which may be defective or inconsistent with the intended beneficial ownership limitation herein contained or to make changes or
supplements necessary or desirable to properly give effect to such limitation. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">A-3 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">2. <U>ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF WARRANT SHARES</U>. The Exercise Price and the
number of Warrant Shares shall be adjusted from time to time as follows: </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(a) <U>Stock Dividends and Splits</U>. Without limiting any
provision of Section&nbsp;4, if the Company, at any time on or after the Subscription Date, (i)&nbsp;pays a stock dividend on one or more classes of its then outstanding shares of Common Stock or otherwise makes a distribution on any class of
capital stock that is payable in shares of Common Stock, (ii)&nbsp;subdivides (by any stock split, stock dividend, recapitalization or otherwise) one or more classes of its then outstanding shares of Common Stock into a larger number of shares or
(iii)&nbsp;combines (by combination, reverse stock split or otherwise) one or more classes of its then outstanding shares of Common Stock into a smaller number of shares (a &#147;<B>Stock Combination Event</B>&#148;), then in each such case the
Exercise Price shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock outstanding immediately before such event and of which the denominator shall be the number of shares of Common Stock outstanding
immediately after such event. Any adjustment made pursuant to clause (i)&nbsp;of this paragraph shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution, and any
adjustment pursuant to clause (ii)&nbsp;or (iii)&nbsp;of this paragraph shall become effective immediately after the effective date of such subdivision or combination. If any event requiring an adjustment under this paragraph occurs during the
period that an Exercise Price is calculated hereunder, then the calculation of such Exercise Price shall be adjusted appropriately to reflect such event. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(b) <U>Number of Warrant Shares</U>. Simultaneously with any adjustment to the Exercise Price pursuant to paragraphs (a)&nbsp;of this
Section&nbsp;2, the number of Warrant Shares that may be purchased upon exercise of this Warrant shall be increased or decreased proportionately, so that after such adjustment the aggregate Exercise Price payable hereunder for the adjusted number of
Warrant Shares shall be the same as the aggregate Exercise Price in effect immediately prior to such adjustment (without regard to any limitations on exercise contained herein). </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(c) <U>Holder&#146;s Right of Alternative Exercise Price Following Issuance of Certain Options or Convertible Securities</U>. In addition to
and not in limitation of the other provisions of this Section&nbsp;2, if the Company in any manner issues or sells any Options or Convertible Securities (any such securities, &#147;<B>Variable Price Securities</B>&#148;) after the Subscription Date
that are convertible into or exchangeable or exercisable for shares of Common Stock at a price which varies or may vary with the market price of the Common Shares, including by way of one or more reset(s) to a fixed price, but exclusive of such
formulations reflecting customary anti-dilution provisions (such as share splits, share combinations, share dividends and similar transactions) (each of the formulations for such variable price being herein referred to as, the &#147;<B>Variable
Price</B>&#148;), the Company shall provide written notice thereof via facsimile and overnight courier to the Holder on the date of issuance of such Convertible Securities or Options. From and after the date the Company issues any such Convertible
Securities or Options with a Variable Price, the Holder shall have the right, but not the obligation, in its sole discretion to substitute the Variable Price for the Exercise Price upon exercise of this Warrant by designating in the Exercise Notice
delivered upon any exercise of this Warrant that solely for purposes of such exercise the Holder is relying on the Variable Price rather than the Exercise Price then in effect. The Holder&#146;s election to rely on a Variable Price for a particular
exercise of this Warrant shall not obligate the Holder to rely on a Variable Price for any future exercises of this Warrant. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(d)
<U>Calculations</U>. All calculations under this Section&nbsp;2 shall be made by rounding to the nearest cent or the nearest 1/100th of a share, as applicable. The number of shares of Common Stock outstanding at any given time shall not include
shares owned or held by or for the account of the Company, and the disposition of any such shares shall be considered an issue or sale of Common Stock. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">3. <U>RIGHTS UPON DISTRIBUTION OF ASSETS</U>. If the Company shall declare or make any dividend or other distribution of its assets (or rights
to acquire its assets) to holders of shares of Common Stock, by way of return of capital or otherwise (including, without limitation, any distribution of cash, stock or other securities, property or options by way of a dividend, spin off,
reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a &#147;<B>Distribution</B>&#148;), at any time after the issuance of this Warrant, then, in each such case (a)&nbsp;any Exercise Price in effect
immediately prior to the close of business on the record date fixed for the determination of holders of shares of Common Stock entitled to receive the Distribution shall be reduced, effective as of the close of business on such record date, to a
price determined by multiplying such Exercise Price by a fraction of which (i)&nbsp;the numerator shall be the Closing Bid Price of the shares of Common Stock on the Trading Day immediately preceding such record date minus the value of the
Distribution (as determined in good faith by the Company&#146;s Board of </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">A-4 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
Directors) applicable to one share of Common Stock, and (ii)&nbsp;the denominator shall be the Closing Bid Price of the shares of Common Stock on the Trading Day immediately preceding such record
date; and (b)&nbsp;the number of Warrant Shares shall be increased to a number of shares equal to the number of shares of Common Stock obtainable immediately prior to the close of business on the record date fixed for the determination of holders of
shares of Common Stock entitled to receive the Distribution multiplied by the reciprocal of the fraction set forth in the immediately preceding paragraph (a). </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">4. <U>PURCHASE RIGHTS; FUNDAMENTAL TRANSACTIONS</U>. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(a) <U>Purchase Rights</U>. In addition to any adjustments pursuant to Section&nbsp;2 above, if at any time the Company grants, issues or
sells any Options, Convertible Securities or rights to purchase stock, warrants, securities or other property pro rata to the record holders of any class of shares of Common Stock (the &#147;<B>Purchase Rights</B>&#148;), then the Holder will be
entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had held the number of shares of Common Stock acquirable upon complete exercise of this Warrant
(without regard to any limitations on exercise hereof, including without limitation, the Maximum Percentage) immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is
taken, the date as of which the record holders of shares of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights (provided, however, to the extent that the Holder&#146;s right to participate in any such Purchase
Right would result in the Holder exceeding the Maximum Percentage, then the Holder shall not be entitled to participate in such Purchase Right to such extent (or beneficial ownership of such shares of Common Stock as a result of such Purchase Right
to such extent) and such Purchase Right to such extent shall be held in abeyance for the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Maximum Percentage). </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(b) <U>Fundamental Transaction</U><U>s</U>. Upon the consummation of each Fundamental Transaction, the Successor Entity shall succeed to, and
be substituted for (so that from and after the date of the applicable Fundamental Transaction, the provisions of this Warrant and the other Transaction Documents referring to the &#147;Company&#148; shall refer instead to the Successor Entity), and
may exercise every right and power of the Company and shall assume all of the obligations of the Company under this Warrant with the same effect as if such Successor Entity had been named as the Company herein. Upon consummation of each Fundamental
Transaction, the Successor Entity shall deliver to the Holder confirmation that there shall be issued upon exercise of this Warrant at any time after the consummation of the applicable Fundamental Transaction, in lieu of the shares of Common Stock
(or other securities, cash, assets or other property (except such items still issuable under Sections 3 and 4(a) above, which shall continue to be receivable thereafter)) issuable upon the exercise of this Warrant prior to the applicable Fundamental
Transaction, such shares of publicly traded common stock (or its equivalent) of the Successor Entity (including its Parent Entity) which the Holder would have been entitled to receive upon the happening of the applicable Fundamental Transaction had
this Warrant been exercised immediately prior to the applicable Fundamental Transaction (without regard to any limitations on the exercise of this Warrant), as adjusted in accordance with the provisions of this Warrant. Notwithstanding the
foregoing, and without limiting Section&nbsp;1(g) hereof, the Holder may elect, at its sole option, by delivery of written notice to the Company to waive this Section&nbsp;4(b) to permit the Fundamental Transaction without the assumption of this
Warrant. In addition to and not in substitution for any other rights hereunder, prior to the consummation of each Fundamental Transaction pursuant to which holders of shares of Common Stock are entitled to receive securities or other assets with
respect to or in exchange for shares of Common Stock (a &#147;<B>Corporate Event</B>&#148;), the Company shall make appropriate provision to insure that the Holder will thereafter have the right to receive upon an exercise of this Warrant at any
time after the consummation of the applicable Fundamental Transaction but prior to the Expiration Date, in lieu of the shares of the Common Stock (or other securities, cash, assets or other property (except such items still issuable under Sections 3
and 4(a) above, which shall continue to be receivable thereafter)) issuable upon the exercise of the Warrant prior to such Fundamental Transaction, such shares of stock, securities, cash, assets or any other property whatsoever (including warrants
or other purchase or subscription rights) which the Holder would have been entitled to receive upon the happening of the applicable Fundamental Transaction had this Warrant been exercised immediately prior to the applicable Fundamental Transaction
(without regard to any limitations on the exercise of this Warrant). Provision made pursuant to the preceding sentence shall be in a form and substance reasonably satisfactory to the Holder. Notwithstanding the foregoing, in the event of a
Fundamental Transaction, at the request of the Holder delivered before the 90th day after such Fundamental Transaction, the Company (or the Successor Entity) shall purchase this Warrant from the Holder by paying to the Holder, within five Business
Days after such request (or, if later, on the effective date of the Fundamental Transaction), cash in an amount equal to the Black Scholes Value of the remaining unexercised portion of this Warrant on the date of such Fundamental Transaction. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">A-5 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(c) <U>Application</U>. The provisions of this Section&nbsp;4 shall apply similarly and equally
to successive Fundamental Transactions and Corporate Events and shall be applied as if this Warrant (and any such subsequent warrants) were fully exercisable and without regard to any limitations on the exercise of this Warrant (provided that the
Holder shall continue to be entitled to the benefit of the Maximum Percentage, applied however with respect to shares of capital stock registered under the 1934 Act and thereafter receivable upon exercise of this Warrant (or any such other
warrant)). </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">5. <U>NONCIRCUMVENTION</U>. The Company hereby covenants and agrees that the Company will not, by amendment of its Certificate
of Incorporation, Bylaws or through any reorganization, transfer of assets, consolidation, merger, scheme of arrangement, dissolution, issue or sale of securities, or any other voluntary action, avoid or seek to avoid the observance or performance
of any of the terms of this Warrant, and will at all times in good faith carry out all the provisions of this Warrant and take all action as may be required to protect the rights of the Holder. Without limiting the generality of the foregoing, the
Company (i)&nbsp;shall not increase the par value of any shares of Common Stock receivable upon the exercise of this Warrant above the Exercise Price then in effect, (ii)&nbsp;shall take all such actions as may be necessary or appropriate in order
that the Company may validly and legally issue fully paid and nonassessable shares of Common Stock upon the exercise of this Warrant, and (iii)&nbsp;shall, so long as this Warrant is outstanding, take all action necessary to reserve and keep
available out of its authorized and unissued shares of Common Stock, solely for the purpose of effecting the exercise of this Warrant, 100% of the number of shares of Common Stock issuable upon exercise of this Warrant then outstanding (without
regard to any limitations on exercise). </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">6. <U>WARRANT HOLDER NOT DEEMED A STOCKHOLDER</U>. Except as otherwise specifically provided
herein, the Holder, solely in such Person&#146;s capacity as a holder of this Warrant, shall not be entitled to vote or receive dividends or be deemed the holder of share capital of the Company for any purpose, nor shall anything contained in this
Warrant be construed to confer upon the Holder, solely in such Person&#146;s capacity as the Holder of this Warrant, any of the rights of a stockholder of the Company or any right to vote, give or withhold consent to any corporate action (whether
any reorganization, issue of stock, reclassification of stock, consolidation, merger, conveyance or otherwise), receive notice of meetings, receive dividends or subscription rights, or otherwise, prior to the issuance to the Holder of the Warrant
Shares which such Person is then entitled to receive upon the due exercise of this Warrant. In addition, nothing contained in this Warrant shall be construed as imposing any liabilities on the Holder to purchase any securities (upon exercise of this
Warrant or otherwise) or as a stockholder of the Company, whether such liabilities are asserted by the Company or by creditors of the Company. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">7. <U>REISSUANCE OF WARRANTS</U>. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(a) <U>Transfer of Warrant</U>. If this Warrant is to be transferred, the Holder shall surrender this Warrant to the Company, whereupon the
Company will forthwith issue and deliver upon the order of the Holder a new Warrant (in accordance with Section&nbsp;7(d)), registered as the Holder may request, representing the right to purchase the number of Warrant Shares being transferred by
the Holder and, if less then the total number of Warrant Shares then underlying this Warrant is being transferred, a new Warrant (in accordance with Section 7(d)) to the Holder representing the right to purchase the number of Warrant Shares not
being transferred. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(b) <U>Lost, Stolen or Mutilated Warrant</U>. Upon receipt by the Company of evidence reasonably satisfactory to the
Company of the loss, theft, destruction or mutilation of this Warrant, and, in the case of loss, theft or destruction, of any indemnification undertaking by the Holder to the Company in customary form and, in the case of mutilation, upon surrender
and cancellation of this Warrant, the Company shall execute and deliver to the Holder a new Warrant (in accordance with Section 7(d)) representing the right to purchase the Warrant Shares then underlying this Warrant. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(c) <U>Exchangeable for Multiple Warrants</U>. This Warrant is exchangeable, upon the surrender hereof by the Holder at the principal office
of the Company, for a new Warrant or Warrants (in accordance with Section 7(d)) representing in the aggregate the right to purchase the number of Warrant Shares then underlying this Warrant, and each such new Warrant will represent the right to
purchase such portion of such Warrant Shares as is designated by the Holder at the time of such surrender; provided, however, that no Warrants for fractional shares of Common Stock shall be given. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">A-6 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(d) <U>Issuance of New Warrants</U>. Whenever the Company is required to issue a new Warrant
pursuant to the terms of this Warrant, such new Warrant (i)&nbsp;shall be of like tenor with this Warrant, (ii)&nbsp;shall represent, as indicated on the face of such new Warrant, the right to purchase the Warrant Shares then underlying this Warrant
(or in the case of a new Warrant being issued pursuant to Section&nbsp;7(a) or Section&nbsp;7(c), the Warrant Shares designated by the Holder which, when added to the number of shares of Common Stock underlying the other new Warrants issued in
connection with such issuance, does not exceed the number of Warrant Shares then underlying this Warrant), (iii)&nbsp;shall have an issuance date, as indicated on the face of such new Warrant which is the same as the Issuance Date, and
(iv)&nbsp;shall have the same rights and conditions as this Warrant. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">8. <U>NOTICES</U>. Whenever notice is required to be given under
this Warrant, unless otherwise provided herein, such notice shall be given in accordance with Section&nbsp;7 of Annex I to the Subscription Agreement. The Company shall provide the Holder with prompt written notice of all actions taken pursuant to
this Warrant, including in reasonable detail a description of such action and the reason therefor. Without limiting the generality of the foregoing, the Company will give written notice to the Holder (i)&nbsp;immediately upon each adjustment of the
Exercise Price and the number of Warrant Shares, setting forth in reasonable detail, and certifying, the calculation of such adjustment(s) and (ii)&nbsp;at least fifteen (15)&nbsp;days prior to the date on which the Company closes its books or takes
a record (A)&nbsp;with respect to any dividend or distribution upon the shares of Common Stock, (B)&nbsp;with respect to any grants, issuances or sales of any Options, Convertible Securities or rights to purchase stock, warrants, securities or other
property to holders of shares of Common Stock or (C)&nbsp;for determining rights to vote with respect to any Fundamental Transaction, dissolution or liquidation, provided in each case that such information shall be made known to the public prior to
or in conjunction with such notice being provided to the Holder and (iii)&nbsp;at least ten (10)&nbsp;Trading Days prior to the consummation of any Fundamental Transaction. To the extent that any notice provided hereunder constitutes, or contains,
material, non-public information regarding the Company or any of its Subsidiaries, the Company shall simultaneously file such notice with the SEC (as defined in the Securities Purchase Agreement) pursuant to a Current Report on Form 8-K. It is
expressly understood and agreed that the time of execution specified by the Holder in each Exercise Notice shall be definitive and may not be disputed or challenged by the Company. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">9. <U>AMENDMENT AND WAIVER</U>. Except as otherwise provided herein, the provisions of this Warrant may be amended and the Company may take
any action herein prohibited, or omit to perform any act herein required to be performed by it, only if the Company has obtained the written consent of the Holder. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">10. <U>SEVERABILITY</U>. If any provision of this Warrant is prohibited by law or otherwise determined to be invalid or unenforceable by a
court of competent jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended to apply to the broadest extent that it would be valid and enforceable, and the invalidity or unenforceability of
such provision shall not affect the validity of the remaining provisions of this Warrant so long as this Warrant as so modified continues to express, without material change, the original intentions of the parties as to the subject matter hereof and
the prohibited nature, invalidity or unenforceability of the provision(s) in question does not substantially impair the respective expectations or reciprocal obligations of the parties or the practical realization of the benefits that would
otherwise be conferred upon the parties. The parties will endeavor in good faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect of which comes as close as possible to that of the
prohibited, invalid or unenforceable provision(s). </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">11. <U>GOVERNING LAW</U>. This Warrant shall be governed by and construed and enforced
in accordance with, and all questions concerning the construction, validity, interpretation and performance of this Warrant shall be governed by, the internal laws of the State of York, without giving effect to any choice of law or conflict of law
provision or rule (whether of the State of New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of New York. The Company hereby irrevocably submits to the exclusive jurisdiction
of the state and federal courts sitting in The City of New York, Borough of Manhattan, for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such
suit, action or proceeding is improper. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">A-7 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. Nothing contained herein shall be deemed or operate to preclude the Holder
from bringing suit or taking other legal action against the Company in any other jurisdiction to collect on the Company&#146;s obligations to the Holder or to enforce a judgment or other court ruling in favor of the Holder. <B>THE COMPANY HEREBY
IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS WARRANT OR ANY TRANSACTION CONTEMPLATED HEREBY.</B> </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">12. <U>CONSTRUCTION; HEADINGS</U>. This Warrant shall be deemed to be jointly drafted by the Company and the Holder and shall not be construed
against any Person as the drafter hereof. The headings of this Warrant are for convenience of reference and shall not form part of, or affect the interpretation of, this Warrant. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">13. <U>DISPUTE RESOLUTION</U>. In the case of a dispute as to the determination of the Exercise Price, the Closing Sale Price, the Closing Bid
Price or fair market value or the arithmetic calculation of the Warrant Shares (as the case may be), the Company or the Holder (as the case may be) shall submit the disputed determinations or arithmetic calculations (as the case may be) via
facsimile (i)&nbsp;within two (2)&nbsp;Business Days after receipt of the applicable notice giving rise to such dispute to the Company or the Holder (as the case may be) or (ii)&nbsp;if no notice gave rise to such dispute, at any time after the
Holder learned of the circumstances giving rise to such dispute. If the Holder and the Company are unable to agree upon such determination or calculation (as the case may be) of the Exercise Price, the Closing Sale Price, the Closing Bid Price or
fair market value or the number of Warrant Shares (as the case may be) within three (3)&nbsp;Business Days of such disputed determination or arithmetic calculation being submitted to the Company or the Holder (as the case may be), then the Company
shall, within two (2)&nbsp;Business Days submit via facsimile (a)&nbsp;the disputed determination of the Exercise Price, the Closing Sale Price, the Closing Bid Price or fair market value (as the case may be) to an independent, reputable investment
bank selected by the Company and agreed to by the Holder or (b)&nbsp;the disputed arithmetic calculation of the Warrant Shares to the Company&#146;s independent, outside accountant. The Company shall cause the investment bank or the accountant (as
the case may be) to perform the determinations or calculations (as the case may be) and notify the Company and the Holder of the results no later than ten (10)&nbsp;Business Days from the time it receives such disputed determinations or calculations
(as the case may be). Such investment bank&#146;s or accountant&#146;s determination or calculation (as the case may be) shall be binding upon all parties absent demonstrable error. The expenses of the investment bank and accountant will be borne by
the Company unless the investment bank or accountant determines that the determination of the Exercise Price or the arithmetic calculation of the Warrant Shares by the Holder was incorrect, in which case the expenses of the investment bank and
accountant will be borne by the Holder. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">14. <U>REMEDIES, CHARACTERIZATION, OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF</U>. The
remedies provided in this Warrant shall be cumulative and in addition to all other remedies available under this Warrant and the Subscription Agreement, at law or in equity (including a decree of specific performance and/or other injunctive relief),
and nothing herein shall limit the right of the Holder to pursue actual damages for any failure by the Company to comply with the terms of this Warrant. The Company covenants to the Holder that there shall be no characterization concerning this
instrument other than as expressly provided herein. Amounts set forth or provided for herein with respect to payments, exercises and the like (and the computation thereof) shall be the amounts to be received by the Holder and shall not, except as
expressly provided herein, be subject to any other obligation of the Company (or the performance thereof). The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Holder and that the remedy at law
for any such breach may be inadequate. The Company therefore agrees that, in the event of any such breach or threatened breach, the holder of this Warrant shall be entitled, in addition to all other available remedies, to an injunction restraining
any breach, without the necessity of showing economic loss and without any bond or other security being required. The Company shall provide all information and documentation to the Holder that is requested by the Holder to enable the Holder to
confirm the Company&#146;s compliance with the terms and conditions of this Warrant (including, without limitation, compliance with Section&nbsp;2 hereof). The issuance of shares and certificates for shares as contemplated hereby upon the exercise
of this Warrant shall be made without charge to the Holder or such shares for any issuance tax or other costs in respect thereof, provided that the Company shall not be required to pay any tax which may be payable in respect of any transfer involved
in the issuance and delivery of any certificate in a name other than the Holder or its agent on its behalf. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">A-8 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">15. <U>TRANSFER</U>. This Warrant may be offered for sale, sold, transferred or assigned without
the consent of the Company, subject to the applicable securities laws. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">16. <U>CERTAIN DEFINITIONS</U>. For purposes of this Warrant, the
following terms shall have the following meanings: </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(a) &#147;<B>Black Scholes Value</B>&#148; means the value of the unexercised portion
of this Warrant remaining on the date of the Holder&#146;s request, which value is calculated using the Black Scholes Option Pricing Model obtained from the &#147;OV&#148; function on Bloomberg utilizing (i)&nbsp;an underlying price per share equal
to the greater of (1)&nbsp;the highest Closing Sale Price of the Common Stock during the period beginning on the Trading Day immediately preceding the public disclosure of the applicable Fundamental Transaction and ending on the Trading Day
immediately preceding the consummation of the applicable Fundamental Transaction and (2)&nbsp;the sum of the price per share being offered in cash in the applicable Fundamental Transaction (if any) plus the value of the non-cash consideration being
offered in the applicable Fundamental Transaction (if any), (ii)&nbsp;a strike price equal to the Exercise Price in effect on the of date of the Holder&#146;s request, (iii)&nbsp;a risk-free interest rate corresponding to the U.S. Treasury rate for
a period equal to the greater of (1)&nbsp;the remaining term of this Warrant as of the date of the Holder&#146;s request and (2)&nbsp;the remaining term of this Warrant as of the date of consummation of the applicable Fundamental Transaction or as
of the date of the Holder&#146;s request pursuant to Section&nbsp;4(c) if such request is prior to the date of the consummation of the applicable Fundamental Transaction and (iv)&nbsp;an expected volatility equal to the greater of 80% and the 90 day
volatility obtained from the HVT function on Bloomberg (determined utilizing a 365 day annualization factor) as of the Trading Day immediately following the earlier to occur of the public disclosure or consummation of the applicable Fundamental
Transaction. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(b) &#147;<B>Bloomberg</B>&#148; means Bloomberg, L.P. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(c) &#147;<B>Business Day</B>&#148; means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York
are authorized or required by law to remain closed. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(d) &#147;<B>Closing Bid Price</B>&#148; and &#147;<B>Closing Sale Price</B>&#148;
means, for any security as of any date, the last closing bid price and last closing trade price, respectively, for such security on the Principal Market, as reported by Bloomberg, or, if the Principal Market begins to operate on an extended hours
basis and does not designate the closing bid price or the closing trade price, as the case may be, then the last bid price or the last trade price, respectively, of such security prior to 4:00:00 p.m., New York time, as reported by Bloomberg, or, if
the Principal Market is not the principal securities exchange or trading market for such security, the last closing bid price or last trade price, respectively, of such security on the principal securities exchange or trading market where such
security is listed or traded as reported by Bloomberg, or if the foregoing do not apply, the last closing bid price or last trade price, respectively, of such security in the over-the-counter market on the electronic bulletin board for such security
as reported by Bloomberg, or, if no closing bid price or last trade price, respectively, is reported for such security by Bloomberg, the average of the bid prices, or the ask prices, respectively, of any market makers for such security as reported
in the &#147;pink sheets&#148; by Pink Sheets LLC (formerly the National Quotation Bureau, Inc.). If the Closing Bid Price or the Closing Sale Price cannot be calculated for a security on a particular date on any of the foregoing bases, the Closing
Bid Price or the Closing Sale Price, as the case may be, of such security on such date shall be the fair market value as mutually determined by the Company and the Holder. All such determinations to be appropriately adjusted for any stock dividend,
stock split, stock combination or other similar transaction during the applicable calculation period. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(e) &#147;<B>Common
Stock</B>&#148; means (i)&nbsp;the Company&#146;s shares of common stock, and (ii)&nbsp;any capital stock into which such common stock shall have been changed or any share capital resulting from a reclassification of such common stock. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(f) &#147;<B>Convertible Securities</B>&#148; means any stock or other security (other than Options) that is at any time and under any
circumstances, directly or indirectly, convertible into, exercisable or exchangeable for, or which otherwise entitles the holder thereof to acquire, any shares of Common Stock. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(g) &#147;<B>Eligible Market</B>&#148; means The New York Stock Exchange, the NYSE Amex, the Nasdaq Global Select Market, the Nasdaq Global
Market or the Principal Market. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">A-9 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(h) &#147;<B>Expiration Date</B>&#148; means the date that is the second (2nd)&nbsp;anniversary
of the Exercisability Date, if such date falls on a day other than a Business Day or on which trading does not take place on the Principal Market (a &#147;Holiday&#148;), the next date that is not a Holiday. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(i) &#147;<B>Fundamental Transaction</B>&#148; means that (i)&nbsp;the Company or any of its Subsidiaries shall, directly or indirectly, in
one or more related transactions, (1)&nbsp;consolidate or merge with or into (whether or not the Company or any of its Subsidiaries is the surviving corporation) any other Person, or (2)&nbsp;sell, lease, license, assign, transfer, convey or
otherwise dispose of all or substantially all of its respective properties or assets to any other Person, or (3)&nbsp;allow any other Person to make a purchase, tender or exchange offer that is accepted by the holders of more than 50% of the
outstanding shares of Voting Stock of the Company (not including any shares of Voting Stock of the Company held by the Person or Persons making or party to, or associated or affiliated with the Persons making or party to, such purchase, tender or
exchange offer), or (4)&nbsp;consummate a stock or share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with any other Person whereby such other
Person acquires more than 50% of the outstanding shares of Voting Stock of the Company (not including any shares of Voting Stock of the Company held by the other Person or other Persons making or party to, or associated or affiliated with the other
Persons making or party to, such stock or share purchase agreement or other business combination), or (5)&nbsp;(I)&nbsp;reorganize, recapitalize or reclassify the Common Stock, (II) effect or consummate a stock combination, reverse stock split or
other similar transaction involving the Common Stock or (III) make any public announcement or disclosure with respect to any stock combination, reverse stock split or other similar transaction involving the Common Stock (including, without
limitation, any public announcement or disclosure of (x)&nbsp;any potential, possible or actual stock combination, reverse stock split or other similar transaction involving the Common Stock or (y)&nbsp;board or stockholder approval thereof, or the
intention of the Company to seek board or stockholder approval of any stock combination, reverse stock split or other similar transaction involving the Common Stock), or (ii)&nbsp;any &#147;person&#148; or &#147;group&#148; (as these terms are used
for purposes of Sections 13(d) and 14(d) of the 1934 Act and the rules and regulations promulgated thereunder) is or shall become the &#147;beneficial owner&#148; (as defined in Rule 13d-3 under the 1934 Act), directly or indirectly, of 50% of the
aggregate ordinary voting power represented by issued and outstanding Voting Stock of the Company. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(j) &#147;<B>Options</B>&#148; means
any rights, warrants or options to subscribe for or purchase shares of Common Stock or Convertible Securities. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(k) &#147;<B>Parent
Entity</B>&#148; of a Person means an entity that, directly or indirectly, controls the applicable Person and whose common stock or equivalent equity security is quoted or listed on an Eligible Market, or, if there is more than one such Person or
Parent Entity, the Person or Parent Entity with the largest public market capitalization as of the date of consummation of the Fundamental Transaction. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(l) &#147;<B>Person</B>&#148; means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an
unincorporated organization, any other entity or a government or any department or agency thereof. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(m) &#147;<B>Principal
Market</B>&#148; means the Nasdaq Global Select Market. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(n) &#147;<B>Successor Entity</B>&#148; means the Person (or, if so elected by
the Holder, the Parent Entity) formed by, resulting from or surviving any Fundamental Transaction or the Person (or, if so elected by the Holder, the Parent Entity) with which such Fundamental Transaction shall have been entered into. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(o) &#147;<B>Trading Day</B>&#148; means any day on which the Common Stock is traded on the Principal Market, or, if the Principal Market is
not the principal trading market for the Common Stock, then on the principal securities exchange or securities market on which the Common Stock is then traded, provided that &#147;Trading Day&#148; shall not include any day on which the Common Stock
is scheduled to trade on such exchange or market for less than 4.5 hours or any day that the Common Stock is suspended from trading during the final hour of trading on such exchange or market (or if such exchange or market does not designate in
advance the closing time of trading on such exchange or market, then during the hour ending at 4:00:00 p.m., New York time) unless such day is otherwise designated as a Trading Day in writing by the Holder. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">A-10 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(p) &#147;<B>Voting Stock</B>&#148; of a Person means capital stock of such Person of the class
or classes pursuant to which the holders thereof have the general voting power to elect, or the general power to appoint, at least a majority of the board of directors, managers or trustees of such Person (irrespective of whether or not at the time
capital stock of any other class or classes shall have or might have voting power by reason of the happening of any contingency). </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">[<I>signature page follows</I>] </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">A-11 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>IN WITNESS WHEREOF</B>, the Company has caused this Warrant to Purchase Common Stock to be
duly executed as of the Issuance Date set out above. </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><DIV ALIGN="right">
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="40%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt">


<TR>
<TD WIDTH="6%"></TD>
<TD VALIGN="bottom" WIDTH="1%"></TD>
<TD WIDTH="12%"></TD>
<TD VALIGN="bottom" WIDTH="1%"></TD>
<TD WIDTH="80%"></TD></TR>


<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="5"><B>XOMA CORPORATION</B></TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="4"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">By:</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top" COLSPAN="3"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">&nbsp;</P></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">Name:</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">Title:</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top"></TD></TR>
</TABLE></DIV>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">A-12 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="right"><B>EXHIBIT A </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>EXERCISE NOTICE </B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>TO BE
EXECUTED BY THE REGISTERED HOLDER TO EXERCISE THIS </B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>WARRANT TO PURCHASE COMMON STOCK </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>XOMA CORPORATION </B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The
undersigned holder hereby exercises the right to purchase &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; of the shares of Common Stock (&#147;<B>Warrant Shares</B>&#148;) of <B>XOMA CORPORATION</B>,
a Delaware corporation (the &#147;<B>Company</B>&#148;), evidenced by the attached Warrant to Purchase Common Stock (the &#147;<B>Warrant</B>&#148;). Capitalized terms used herein and not otherwise defined shall have the respective meanings set
forth in the Warrant. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">1. Form of Exercise Price. The Holder intends that payment of the Exercise Price shall be made as: </P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><DIV ALIGN="right">
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="94%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt">


<TR>
<TD WIDTH="12%"></TD>
<TD VALIGN="bottom" WIDTH="1%"></TD>
<TD WIDTH="87%"></TD></TR>


<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">&nbsp;</P></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">a &#147;Cash Exercise&#148; with respect to &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Warrant Shares; and/or</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">&nbsp;</P></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">a &#147;Cashless Exercise&#148; with respect to &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Warrant Shares.</TD></TR>
</TABLE></DIV> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">2. Payment of Exercise Price. In the event that the holder has elected a Cash Exercise with respect to
some or all of the Warrant Shares to be issued pursuant hereto, the holder shall pay the Aggregate Exercise Price in the sum of $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;to the Company in accordance with the terms of the Warrant. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">3. Delivery of Warrant Shares. The Company shall deliver to the holder
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Warrant Shares in accordance with the terms of the Warrant. </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Date: &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp;&nbsp;, &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Name of Registered Holder </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="40%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt">


<TR>
<TD WIDTH="7%"></TD>
<TD VALIGN="bottom" WIDTH="1%"></TD>
<TD WIDTH="92%"></TD></TR>


<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">By:</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">&nbsp;</P></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">Name:</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">Title:</TD></TR>
</TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">A-13 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>ACKNOWLEDGMENT </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The Company hereby acknowledges this Exercise Notice and hereby directs Wells Fargo Shareholder Services to issue the above indicated number
of shares of Common Stock in accordance with the Transfer Agent Instructions dated &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;, 201&nbsp;&nbsp;&nbsp;&nbsp; from the Company and acknowledged and
agreed to by Wells Fargo Shareholder Services. </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><DIV ALIGN="right">
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="40%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt">


<TR>
<TD WIDTH="7%"></TD>
<TD VALIGN="bottom" WIDTH="1%"></TD>
<TD WIDTH="6%"></TD>
<TD VALIGN="bottom" WIDTH="1%"></TD>
<TD WIDTH="85%"></TD></TR>


<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="5"><B>XOMA CORPORATION</B></TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">By:</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">&nbsp;</P></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">Name:</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">Title:</TD></TR>
</TABLE></DIV>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">A-14 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>PROSPECTUS </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:18pt; font-family:Times New Roman" ALIGN="center"><B>$150,000,000 </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<P STYLE="font-size:1pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P> <P STYLE="margin-top:0pt;margin-bottom:0pt" ALIGN="center">


<IMG SRC="g834930cov_pg001.jpg" ALT="LOGO">
 </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>Common Stock </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>Preferred Stock </B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>Debt
Securities </B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>Warrants </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center>
<P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We may, from
time to time, offer to sell up to $150,000,000 of any combination of our common stock, preferred stock, debt securities or warrants described in this prospectus, either individually or in combination with other securities, at prices and on terms
described in one or more supplements to this prospectus. We may also offer common stock or preferred stock upon conversion of debt securities, common stock upon conversion of preferred stock, or common stock, preferred stock or debt securities upon
the exercise of warrants. We may also authorize one or more free writing prospectuses to be provided to you in connection with these offerings. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">This prospectus describes some of the general terms that may apply to an offering of our securities. The specific terms and any other
information relating to a specific offering will be set forth in a post-effective amendment to the registration statement of which this prospectus is a part, in a supplement to this prospectus, or in a free writing prospectus or may be set forth in
one or more documents incorporated by reference in this prospectus. You should read this prospectus, the information incorporated by reference in this prospectus and any applicable prospectus supplement or free writing prospectus carefully before
you invest. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Securities may be sold by us to or through underwriters or dealers, directly to purchasers or through agents designated from
time to time. For additional information on the methods of sale, you should refer to the section entitled &#147;Plan of Distribution&#148; in this prospectus and in the applicable prospectus supplement. If any underwriters are involved in the sale
of any securities with respect to which this prospectus is being delivered, the names of such underwriters and any applicable discounts or commissions and over-allotment options will be set forth in a prospectus supplement. The price to the public
of such securities and the net proceeds we expect to receive from such sale will also be set forth in a prospectus supplement. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Our common
stock is listed on the NASDAQ Global Market under the symbol &#147;XOMA&#148; On September&nbsp;9, 2013, the last reported sale price of our common stock on the NASDAQ Global Market was $4.94 per share. </P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center> <P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:12pt; font-family:Times New Roman"><B>Investing in our securities involves a high degree of risk. See &#147;<A HREF="#rf834930_1">Risk Factors</A>&#148; on page&nbsp;5 of this
prospectus and as updated in our future filings made with the Securities and Exchange Commission that are incorporated by reference into this prospectus. </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>This prospectus may not be used to offer or sell any securities unless accompanied by a prospectus supplement. </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or
determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center>
<P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>The date of
this prospectus is September&nbsp;20, 2013 </B></P>

<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>TABLE OF CONTENTS </B></P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="100%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" ALIGN="center">


<TR>
<TD WIDTH="95%"></TD>
<TD VALIGN="bottom" WIDTH="3%"></TD>
<TD></TD>
<TD></TD>
<TD></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:8pt">
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="2" ALIGN="center" STYLE="border-bottom:1.00pt solid #000000"><B>Page</B></TD>
<TD VALIGN="bottom">&nbsp;</TD></TR>


<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#toc834930_1">About this Prospectus</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">i</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#toc834930_2">Summary</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">1</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#toc834930_3">The Securities We May Offer</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">2</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#toc834930_4">Risk Factors</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">5</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#toc834930_5">Forward-Looking Statements</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">5</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#toc834930_6">Financial Ratios</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">6</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#toc834930_7">Use of Proceeds</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">6</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#toc834930_8">Description of Capital Stock</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">6</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#toc834930_9">Description of Debt Securities</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">11</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#toc834930_10">Description of Warrants</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">17</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#toc834930_11">Legal Ownership of Securities</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">19</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#toc834930_12">Plan of Distribution</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">23</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#toc834930_13">Legal Matters</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">25</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#toc834930_14">Experts</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">25</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#toc834930_15">Where You Can Find More Information</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">25</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman"><A HREF="#toc834930_16">Incorporation of Certain Information by Reference</A></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;</TD>
<TD NOWRAP VALIGN="bottom" ALIGN="right">25</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
</TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">You should rely only on the information contained in or incorporated by reference into this prospectus or any
applicable prospectus supplement or free writing prospectus. We have not authorized anyone to provide you with different information. We are not making an offer to sell or seeking an offer to buy securities under this prospectus or any applicable
prospectus supplement or free writing prospectus in any jurisdiction where the offer or sale is not permitted. The information contained in this prospectus, any applicable prospectus supplement or free writing prospectus and the documents
incorporated by reference herein and therein are accurate only as of their respective dates, regardless of the time of delivery of this prospectus or any sale of a security. </P>
<P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="supptoc834930_14"></A><A NAME="toc834930_1"></A>About this Prospectus </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">This prospectus is part of a registration statement on Form S-3 that we filed with the Securities and Exchange Commission, or SEC, using a
&#147;shelf&#148; registration process. Under this shelf registration statement, we may sell from time to time in one or more offerings up to a total dollar amount of $150,000,000 of common stock and preferred stock, various series of debt
securities and/or warrants to purchase any of such securities, either individually or in combination with other securities as described in this prospectus. Each time we sell any type or series of securities under this prospectus, we will provide a
prospectus supplement that will contain more specific information about the terms of that offering. We may also authorize one or more free writing prospectuses to be provided to you that may contain material information relating to these offerings.
We may also add, update or change in a prospectus supplement or free writing prospectus any of the information contained in this prospectus or in documents we have incorporated by reference into this prospectus. This prospectus, together with any
applicable prospectus supplement or free writing prospectus and the documents incorporated by reference into this prospectus, include all material information relating to this offering. You should carefully read both this prospectus and any
applicable prospectus supplement and any related free writing prospectus together with the additional information described under &#147;Where You Can Find More Information&#148; before buying securities in this offering. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Unless otherwise specified or required by context, references in this prospectus to &#147;XOMA,&#148; &#147;the Company,&#148; &#147;we,&#148;
&#147;us&#148; and &#147;our&#148; refer to XOMA Corporation, a Delaware corporation and its consolidated subsidiaries, if any, unless otherwise specified. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">i </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>


<div style ="BORDER-BOTTOM:1.00pt solid #000000;BORDER-LEFT:1.00pt solid #000000;BORDER-RIGHT:1.00pt solid #000000;BORDER-TOP:1.00pt solid #000000;MARGIN-LEFT:0px;MARGIN-RIGHT:0px;WIDTH:100%"><div style="width:97%; margin-top:1.5%; margin-left:1.5%; margin-right:-1.25%">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="supptoc834930_15"></A><A NAME="toc834930_2"></A>Summary </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><I>The following summary highlights information contained elsewhere in this prospectus or incorporated by reference herein and does not
contain all the information that may be important to purchasers of our securities. Prospective purchasers of our securities should review this entire prospectus carefully, including the risks of investing discussed under &#147;Risk Factors&#148; on
page&nbsp;5 , the financial statements and related notes, and the information to which we refer you and the information incorporated into this prospectus by reference, for a complete understanding of our business and this offering. </I></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><I>This prospectus and the information incorporated herein by reference include trademarks, service marks and trade names owned by us or other
companies. All trademarks, service marks and trade names included or incorporated by reference into this prospectus, any applicable prospectus supplement or any related free writing prospectus are the property of their respective owners. </I></P>
<P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>XOMA CORPORATION </B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Overview </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">XOMA discovers and develops innovative antibody-based therapeutics. Our lead drug candidate, gevokizumab, is a potent, fully humanized
monoclonal antibody with unique allosteric modulating properties that binds to the inflammatory cytokine interleukin-1 beta (&#147;IL-1 beta&#148;). We believe, by targeting IL-1 beta, gevokizumab has the potential to address the underlying
inflammatory causes of a wide range of diseases that have been identified as unmet medical needs. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Together with our development partner,
Servier, France&#146;s leading independent pharmaceutical company, we initiated three Phase 3 clinical trials evaluating gevokizumab for the treatment of non-infectious uveitis (&#147;NIU&#148;) involving the intermediate and/or posterior segment of
the eye and Beh&ccedil;et&#146;s uveitis, a severe subset of NIU. XOMA is responsible for all of the clinical study sites in the United States, and Servier is responsible for all of the clinical study sites outside of the United States. These
studies are known as the EYEGUARD&#153; program, which includes EYEGUARD-A (patients with acute NIU), EYEGUARD-B (patients with Beh&ccedil;et&#146;s uveitis), and EYEGUARD-C (patients with NIU controlled with corticosteroids, with or without
immunosuppressive medications). As of September&nbsp;1, 2013, we have over 60 of the targeted 70 clinical sites up and running in the U.S. where we are working to accelerate enrollment, and we are working closely with SERVIER to identify ways to
expedite the site activation process outside the U.S. We anticipate disclosing the top-line results of the EYEGUARD studies in 2014. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Our
next gevokizumab Phase 3 indication will be selected based upon the results from our Phase 2 studies in moderate-to severe-inflammatory acne and erosive osteoarthritis of the hand (&#147;EOA&#148;). We reported encouraging top-line results from the
moderate-to-severe inflammatory acne study in January 2013, and top-line results from the EOA study in patients with elevated C-reactive protein (&#147;CRP&#148;), a biomarker for inflammation, are expected in October 2013. We anticipate selecting
the next Phase 3 indication by the end of 2013. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We also have clinical studies assessing gevokizumab&#146;s potential to treat several
rare diseases. In June 2013, we launched a pilot study in inflammatory pyoderma gangrenosum (&#147;PG&#148;), one of the multiple diseases classified as neutrophilic dermatoses. Two additional studies are being conducted in collaboration with the
United States National Institutes of Health (&#147;NIH&#148;). In March 2013, we announced that a gevokizumab study in patients with non-infectious anterior scleritis had opened for enrollment at the National Eye Institute (&#147;NEI&#148;), and in
August 2013, we announced that a gevokizumab clinical study in patients with inflammatory autoimmune inner ear disease (&#147;AIED&#148;), will be run by the North Shore-Long Island Jewish Health System in collaboration with the National Institute
on Deafness and Other Communication Disorders. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Separately, Servier instituted its own active development program for gevokizumab beyond
the NIU and Beh&ccedil;et&#146;s uveitis Phase 3 program. In 2012, Servier initiated a gevokizumab Phase 2 study in patients with acute coronary syndrome, a cardiovascular disease. Servier also began testing gevokizumab in a variety of small
clinical studies, including polymyositis/dermatomyositis and Schnitzler syndrome. Servier indicated these are the first studies in an extensive multi-indication exploratory program it expects to be conducting. </P>
 <P STYLE="margin-top:0pt;margin-bottom:0pt; font-size:8pt">&nbsp;</P></div></div>

 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">1 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>


<div style ="BORDER-BOTTOM:1.00pt solid #000000;BORDER-LEFT:1.00pt solid #000000;BORDER-RIGHT:1.00pt solid #000000;BORDER-TOP:1.00pt solid #000000;MARGIN-LEFT:0px;MARGIN-RIGHT:0px;WIDTH:100%"><div style="width:97%; margin-top:1.5%; margin-left:1.5%; margin-right:-1.25%">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We entered into a license and collaboration agreement with Servier in December 2010 to
jointly develop and commercialize gevokizumab in multiple indications. Under the terms of that agreement, Servier has worldwide rights to gevokizumab for cardiovascular disease and diabetes indications and rights outside the United States and Japan
to all other indications. We retain development and commercialization rights in the United States and Japan to all indications except cardiovascular disease and diabetes and have an option to reacquire rights to these indications from Servier in
these territories, and we intend to commercialize almost all of these other indications in the United States. Additionally, we continue to develop our proprietary preclinical pipeline, primarily focusing on the development of allosteric modulating
monoclonal antibodies. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Risks Associated with our Business </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Our business is subject to numerous risks, as described under the heading &#147;Risk Factors&#148; contained in the applicable prospectus
supplement and in any free writing prospectuses we have authorized for use in connection with a specific offering, and under similar headings in the documents that are incorporated by reference into this prospectus. </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Company Information </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We were incorporated
in Delaware in 1981 and became a Bermuda exempted company in December 1998. Effective December&nbsp;31, 2011, we changed our jurisdiction of incorporation from Bermuda to Delaware and changed our name from XOMA Ltd. to XOMA Corporation. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Our principal executive offices are located at 2910 Seventh Street, Berkeley, California 94710, and we maintain a registered office located at
Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801. Our telephone number at our principal executive offices is (510)&nbsp;204-7200. Our website address is www.xoma.com. Information found on, or accessible through, our website
is not a part of, and is not incorporated into, this prospectus, and you should not consider it part of this prospectus or part of any prospectus supplement. Our website address is included in this document as an inactive textual reference only.
</P> <P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="supptoc834930_16"></A><A NAME="toc834930_3"></A>The Securities We May Offer </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We may offer shares of our common stock and preferred stock, various series of debt securities and/or warrants to purchase any of such
securities, either individually or in combination with other securities, with a total value of up to $150,000,000 from time to time under this prospectus at prices and on terms to be determined at the time of any offering. This prospectus provides
you with a general description of the securities we may offer. Each time we offer a type or series of securities under this prospectus, we will provide a prospectus supplement that will describe the specific amounts, prices and other important terms
of the securities, including, to the extent applicable: </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">designation or classification; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">aggregate principal amount or aggregate offering price; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">maturity; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">original issue discount; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">rates and times of payment of interest or dividends; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">redemption, conversion, exercise, exchange or sinking fund terms; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">ranking; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">restrictive covenants; </TD></TR></TABLE>
 <P STYLE="margin-top:0pt;margin-bottom:0pt; font-size:8pt">&nbsp;</P></div></div>

 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">2 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>


<div style ="BORDER-BOTTOM:1.00pt solid #000000;BORDER-LEFT:1.00pt solid #000000;BORDER-RIGHT:1.00pt solid #000000;BORDER-TOP:1.00pt solid #000000;MARGIN-LEFT:0px;MARGIN-RIGHT:0px;WIDTH:100%"><div style="width:97%; margin-top:1.5%; margin-left:1.5%; margin-right:-1.25%">


<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">voting or other rights; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">conversion or exchange prices or rates and, if applicable, any provisions for changes to or adjustments in the conversion or exchange prices or rates and in the securities or other property receivable upon conversion or
exchange; and </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">a discussion of material United States federal income tax considerations, if any. </TD></TR></TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The
prospectus supplement and any related free writing prospectus that we may authorize to be provided to you may also add, update or change information contained in this prospectus or in documents we have incorporated by reference. However, no
prospectus supplement or free writing prospectus will offer a security that is not registered and described in this prospectus at the time of the effectiveness of the registration statement of which this prospectus is a part. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>This prospectus may not be used to offer or sell securities unless it is accompanied by a prospectus supplement. </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We may sell the securities directly to investors or to or through agents, underwriters or dealers. We, and our agents, underwriters or dealers
reserve the right to accept or reject all or part of any proposed purchase of securities. If we do offer securities to or through agents, underwriters or dealers, we will include in the applicable prospectus supplement: </P>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the names of those agents, underwriters or dealers; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">applicable fees, discounts and commissions to be paid to them; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">details regarding over-allotment options, if any; and </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the net proceeds to us. </TD></TR></TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><I>Common Stock.</I> We may issue shares of our common stock from
time to time. Common stockholders are entitled to one vote per share for the election of directors and on all other matters that require common stockholder approval. Holders of our common stock are entitled to share in an equal amount per share in
any dividends declared by our board of directors on the common stock and paid out of legally available assets. Subject to any preferential rights of any outstanding preferred stock, in the event of our liquidation, dissolution or winding up, holders
of our common stock are entitled to share ratably in the assets remaining after payment of liabilities and the liquidation preferences of any outstanding preferred stock. Our common stock does not carry any preemptive rights enabling a holder to
subscribe for, or receive shares of, any class of our common stock or any other securities convertible into shares of any class of our common stock, or any redemption rights.<I> </I></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><I>Preferred Stock.</I> We may issue shares of our preferred stock from time to time, in one or more series. Our board of directors will
determine the designations, voting powers, preferences and rights of the preferred stock, as well as the qualifications, limitations or restrictions thereof, including dividend rights, conversion rights, preemptive rights, terms of redemption or
repurchase, liquidation preferences, sinking fund terms and the number of shares constituting any series or the designation of any series. Convertible preferred stock will be convertible into our common stock or exchangeable for other securities.
Conversion may be mandatory or at your option and would be at prescribed conversion rates.<I> </I></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">If we sell any series of preferred
stock under this prospectus, we will fix the designations, voting powers, preferences and rights of such series of preferred stock, as well as the qualifications, limitations or restrictions thereof, in the certificate of designation relating to
that series. We will file as an exhibit to the registration statement of which this prospectus is a part, or will incorporate by reference from reports that we file with the SEC, the form of any certificate of designation that describes the terms of
the series of preferred stock that we are offering before the issuance of the related series of preferred stock. We urge you to read the applicable prospectus supplement (and any free writing prospectus that we may authorize to be provided to you)
related to the series of preferred stock being offered, as well as the complete certificate of designation that contains the terms of the applicable series of preferred stock. </P>
 <P STYLE="margin-top:0pt;margin-bottom:0pt; font-size:8pt">&nbsp;</P></div></div>

 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">3 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>


<div style ="BORDER-BOTTOM:1.00pt solid #000000;BORDER-LEFT:1.00pt solid #000000;BORDER-RIGHT:1.00pt solid #000000;BORDER-TOP:1.00pt solid #000000;MARGIN-LEFT:0px;MARGIN-RIGHT:0px;WIDTH:100%"><div style="width:97%; margin-top:1.5%; margin-left:1.5%; margin-right:-1.25%">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><I>Debt Securities.</I> We may issue debt securities from time to time, in one or more
series, as either senior or subordinated debt or as senior or subordinated convertible debt. The senior debt securities will rank equally with any other unsecured and unsubordinated debt. The subordinated debt securities will be subordinate and
junior in right of payment, to the extent and in the manner described in the instrument governing the debt, to all of our senior indebtedness. Convertible debt securities will be convertible into or exchangeable for our common stock or other
securities. Conversion may be mandatory or at your option and would be at prescribed conversion rates.<I> </I></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Any debt securities issued
under this prospectus will be issued under one or more documents called indentures, which are contracts between us and a national banking association or other eligible party, as trustee. In this prospectus, we have summarized certain general
features of the debt securities. We urge you, however, to read the applicable prospectus supplement (and any free writing prospectus that we may authorize to be provided to you) related to the series of debt securities being offered, as well as the
complete indentures that contain the terms of the debt securities. Forms of indentures have been filed as exhibits to the registration statement of which this prospectus is a part, and supplemental indentures and forms of debt securities containing
the terms of the debt securities being offered will be filed as exhibits to the registration statement of which this prospectus is a part or will be incorporated by reference from reports that we file with the SEC. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><I>Warrants.</I> We may issue warrants for the purchase of common stock, preferred stock and/or debt securities in one or more series. We may
issue warrants independently or together with common stock, preferred stock and/or debt securities, and the warrants may be attached to or separate from these securities. In this prospectus, we have summarized certain general features of the
warrants. We urge you, however, to read the applicable prospectus supplement (and any free writing prospectus that we may authorize to be provided to you) related to the series of warrants being offered, as well as any warrant agreements and warrant
certificates that contain the terms of the warrants. We will file as exhibits to the registration statement of which this prospectus is a part, or will incorporate by reference from reports that we file with the SEC, any forms of warrant agreements
and forms of warrant certificates containing the terms of the warrants being offered, and any supplemental warrant agreements and forms of warrant certificates containing the terms of the warrants being offered.<I> </I></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Any warrants issued under this prospectus may be evidenced by warrant certificates. Warrants also may be issued under an applicable warrant
agreement that we enter into with a warrant agent. We will indicate the name and address of the warrant agent, if applicable, in the prospectus supplement relating to the particular series of warrants being offered. </P>
 <P STYLE="margin-top:0pt;margin-bottom:0pt; font-size:8pt">&nbsp;</P></div></div>

 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">4 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="rf834930_1"></A><A NAME="supptoc834930_17"></A><A NAME="toc834930_4"></A>Risk Factors
</B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Investing in our securities involves a high degree of risk. Before deciding whether to invest in our securities, you should consider
carefully the risks and uncertainties described under the heading &#147;Risk Factors&#148; contained in the applicable prospectus supplement and any related free writing prospectus, and discussed under the section entitled &#147;Risk Factors&#148;
contained in our most recent Annual Report on Form 10-K and in our most recent Quarterly Report on Form 10-Q, as well as any amendments thereto reflected in subsequent filings with the SEC, which are incorporated by reference into this prospectus in
their entirety, together with other information in this prospectus, the documents incorporated by reference and any free writing prospectus that we may authorize for use in connection with this offering. The risks described in these documents are
not the only ones we face, but those that we consider to be material. There may be other unknown or unpredictable economic, business, competitive, regulatory or other factors that could have material adverse effects on our future results. Past
financial performance may not be a reliable indicator of future performance, and historical trends should not be used to anticipate results or trends in future periods. If any of these risks actually occurs, our business, financial condition,
results of operations or cash flow could be seriously harmed. This could cause the trading price of our common stock to decline, resulting in a loss of all or part of your investment. Please also read carefully the section below entitled
&#147;Forward-Looking Statements.&#148; </P> <P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="toc834930_5"></A><A NAME="supptoc834930_18"></A>Forward-Looking Statements </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">This prospectus, including the documents that we incorporate by reference herein, contains, and any applicable prospectus supplement or free
writing prospectus including the documents we incorporate by reference therein may contain, forward-looking statements, including statements related to the anticipated size of clinical trials, the anticipated timing of initiation of clinical trials,
the expected availability of clinical trial results, the sufficiency of our cash resources, the estimated costs of clinical trials and the amounts of certain revenues and certain costs in comparison to prior years, or that otherwise relate to future
periods. These statements are based on assumptions that may not prove accurate. Actual results could differ materially from those anticipated due to certain risks inherent in the biotechnology industry and for companies engaged in the development of
new products in a regulated market. Among other things: our product candidates are still being developed, and we will require substantial funds to continue development which may not be available; we have sustained losses in the past and we expect to
sustain losses in the future; we are substantially dependent on Servier for the development and commercialization of gevokizumab and for other aspects of our business; we have received negative results from certain of our clinical trials, and the
pace of certain ongoing trials has not always been what was initially anticipated, and we face uncertain results of other clinical trials of our product candidates; if our therapeutic product candidates do not receive regulatory approval, neither
our third-party collaborators, our contract manufacturers nor we will be able to manufacture and market them; we may not obtain orphan drug exclusivity or we may not receive the full benefit of orphan drug exclusivity even if we obtain such
exclusivity; even once approved, a product may be subject to additional testing or significant marketing restrictions, its approval may be withdrawn or it may be voluntarily taken off the market; we may not be successful in commercializing our
products, which could also affect our development efforts; we are subject to various state and federal healthcare related laws and regulations that may impact the commercialization of ACEON or our product candidates and could subject us to
significant fines and penalties; and certain of our technologies are in-licensed from third parties, so our capabilities using them are restricted and subject to additional risks. Discussions containing these forward-looking statements may be found,
among other places, in the Sections entitled &#147;Business,&#148; &#147;Risk Factors&#148; and &#147;Management&#146;s Discussion and Analysis of Financial Condition and Results of Operations&#148; incorporated by reference from our most recent
Annual Report on Form 10-K and in our Quarterly Reports on Form 10-Q, as well as any amendments thereto, filed with the SEC . These statements relate to future events or our future financial performance and involve known and unknown risks,
uncertainties and other factors that could cause our actual results, levels of activity, performance or achievement to differ materially from those expressed or implied by these forward-looking statements. The risks and uncertainties include, among
others, those referenced in &#147;Risk Factors&#148; above and in any applicable prospectus supplement or free writing prospectus and any documents incorporated by reference herein or therein. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Forward-looking statements include all statements that are not historical facts. In some cases, you can identify forward-looking statements by
terms such as &#147;may,&#148; &#147;will,&#148; &#147;should,&#148; &#147;could,&#148; &#147;would,&#148; &#147;expects,&#148; &#147;plans,&#148; &#147;anticipates,&#148; &#147;believes,&#148; &#147;estimates,&#148; &#147;projects,&#148;
&#147;predicts,&#148; &#147;potential,&#148; or the negative of those terms, and similar expressions and comparable terminology intended to identify forward-looking statements. These statements reflect our current views with respect to future events
and are based on assumptions and subject to risks and uncertainties. Given these uncertainties, you should not place undue reliance on these forward-looking-statements. These forward-looking statements represent our estimates and assumptions only as
of the date of this prospectus and, except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise after the date of this
prospectus. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">5 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="toc834930_6"></A><A NAME="supptoc834930_19"></A>Financial Ratios </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The following table sets forth our ratio of earnings to fixed charges and the amount of deficiency for periods in which the ratio indicates
less than one-to-one coverage: </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="100%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:8pt" ALIGN="center">


<TR>
<TD WIDTH="75%"></TD>
<TD VALIGN="bottom" WIDTH="2%"></TD>
<TD></TD>
<TD></TD>
<TD></TD>
<TD VALIGN="bottom" WIDTH="2%"></TD>
<TD></TD>
<TD></TD>
<TD></TD>
<TD VALIGN="bottom" WIDTH="2%"></TD>
<TD></TD>
<TD></TD>
<TD></TD>
<TD VALIGN="bottom" WIDTH="2%"></TD>
<TD></TD>
<TD></TD>
<TD></TD>
<TD VALIGN="bottom" WIDTH="2%"></TD>
<TD></TD>
<TD></TD>
<TD></TD>
<TD VALIGN="bottom" WIDTH="2%"></TD>
<TD></TD>
<TD></TD>
<TD></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:8pt">
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="2" ALIGN="center" STYLE="border-bottom:1.00pt solid #000000"><B>Six&nbsp;Months<BR>Ended&nbsp;June&nbsp;30,<BR>2013</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="18" ALIGN="center" STYLE="border-bottom:1.00pt solid #000000"><B>Year&nbsp;Ended&nbsp;December&nbsp;31,</B></TD>
<TD VALIGN="bottom">&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:8pt">
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD COLSPAN="2" VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="2" ALIGN="center"><B>2012</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="2" ALIGN="center"><B>2011</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="2" ALIGN="center"><B>2010</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="2" ALIGN="center"><B>2009</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="2" ALIGN="center"><B>2008</B></TD>
<TD VALIGN="bottom">&nbsp;</TD></TR>


<TR BGCOLOR="#cceeff" STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">Ratio of earnings to fixed charges (1)</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">N/A</TD>
<TD NOWRAP VALIGN="bottom">(2)&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">N/A</TD>
<TD NOWRAP VALIGN="bottom">(2)&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">N/A</TD>
<TD NOWRAP VALIGN="bottom">(2)&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">N/A</TD>
<TD NOWRAP VALIGN="bottom">(2)&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">1.9</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">N/A</TD>
<TD NOWRAP VALIGN="bottom">(2)&nbsp;</TD></TR>
</TABLE> <P STYLE="line-height:8.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1px solid #000000;width:10%">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%" VALIGN="top" ALIGN="left">(1)</TD>
<TD ALIGN="left" VALIGN="top">For these purposes, earnings are defined as income before income taxes and fixed charges, and fixed charges include interest expense and the portion of rental expense which is deemed to represent interest.
</TD></TR></TABLE>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%" VALIGN="top" ALIGN="left">(2)</TD>
<TD ALIGN="left" VALIGN="top">Earnings were insufficient to cover fixed charges by $42.1 million for the six months ended June&nbsp;30, 2013 and $71.1 million, $32.7 million, $68.7 million, and $45.6 million for the years ended December&nbsp;31,
2012, 2011, 2010 and 2008, respectively. </TD></TR></TABLE> <P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="toc834930_7"></A><A NAME="supptoc834930_20"></A>Use of Proceeds
</B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Except as described in any applicable prospectus supplement or in any free writing prospectuses we have authorized for use in
connection with a specific offering, we currently intend to use the net proceeds from the sale of the securities offered by us hereunder, if any, for working capital and general corporate purposes, including research and development expenses and
capital expenditures. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The amounts and timing of our use of the net proceeds from this offering will depend on a number of factors, such
as the timing and progress of our research and development efforts, the timing and progress of any partnering and commercialization efforts, technological advances and the competitive environment for our products. As of the date of this prospectus,
we cannot specify with certainty all of the particular uses for the net proceeds to us from the sale of the securities offered by us hereunder. Accordingly, our management will have broad discretion in the timing and application of these proceeds.
Pending application of the net proceeds as described above, we intend to temporarily invest the proceeds in short-term, interest-bearing instruments. </P>
<P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="toc834930_8"></A><A NAME="supptoc834930_21"></A>Description of Capital Stock </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">As of the date of this prospectus, our certificate of incorporation, as amended, authorizes us to issue 138,666,666 shares of common stock,
par value $0.0075 per share, and 1,000,000 shares of preferred stock, par value $0.05 per share. As of September&nbsp;9, 2013, 92,423,652 shares of common stock were outstanding and no shares of preferred stock were outstanding. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The following summary describes the material terms of our capital stock. The description of capital stock is qualified by reference to our
certificate of incorporation and our bylaws. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Common Stock </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><I>Dividends and distributions.</I> The holders of our common stock have the right to receive dividends and distributions, whether payable in
cash or otherwise, as may be declared from time to time by our board of directors, from legally available funds. We have not paid cash dividends on the common stock. We currently do not intend to pay dividends and intend to retain any of our
earnings for use in our business and the financing of our capital requirements for the foreseeable future. The payment of any future cash dividends on the common stock is necessarily dependent upon our earnings and financial needs, along with
applicable legal and contractual restrictions.<I> </I></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><I>Voting rights</I>. Each holder of our common stock is generally entitled to one
vote for each share of common stock owned of record on all matters submitted to a vote of our stockholders. Except as otherwise required by law, holders of common stock (as well as holders of any preferred stock entitled to vote with the common
stockholders) will generally vote together as a single class on all matters presented to the stockholders for their vote or approval, including the election of directors. Any matter brought before the stockholders for a vote, other than the election
of directors, will generally be decided by a majority of the votes cast on the matter, unless the matter is one in which an express provision of the Delaware General Corporation Law, or the DGCL, the certificate of incorporation, the bylaws, the
rules or regulations of any stock exchange applicable to us, applicable law or pursuant to any regulation applicable to us or our securities requires a different vote, in which case the express provision will govern and control
</P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">6 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
the decision of the matter. Directors will be elected by a plurality of the votes cast and entitled to vote generally on the election of directors. There are no cumulative voting rights with
respect to the election of directors or any other matters. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><I>No preemptive or similar rights</I>. Holders of our common stock have no
redemption rights, conversion rights or preemptive rights to purchase or subscribe for our securities.<I> </I></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><I>Right to receive
liquidation distributions</I>. In the event of our liquidation, dissolution or winding-up, holders of our common stock will be entitled to share equally in the assets available for distribution after payment of all creditors and the liquidation
preferences of our preferred stock (if any).<I> </I></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><I>Restrictions on transfer</I>. Neither our certificate of incorporation nor our
bylaws contain any restrictions on the transfer of our common stock. However, in the case of any transfer of shares, there may be restrictions imposed by applicable securities laws or by the terms of restricted share award grants.<I> </I></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><I>Other Provisions</I>. There are no redemption provisions or sinking fund provisions applicable to our common stock. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The rights of the holders of our common stock are subject to, and may be adversely affected by, the rights of holders of shares of any
preferred stock that we may designate and issue in the future. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Preferred Stock </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><I>General.</I> Under our certificate of incorporation, our board of directors is authorized by resolution to divide the preferred stock into
series and, with respect to each series, to determine the designations and the powers, preferences and rights, and the qualifications, limitations and restrictions thereof, including the dividend rights, conversion or exchange rights, voting rights,
redemption rights and terms, liquidation preferences, sinking fund provisions and the number of shares constituting the series. Our board of directors can, without stockholder approval but subject to the terms of the certificate of incorporation and
to any resolution of the stockholders approved by at least 75% of all issued shares entitled to vote in respect thereof, issue preferred stock with voting and other rights that could adversely affect the voting power of the holders of our common
stock and which could have certain anti-takeover effects. Before we may issue any series of preferred stock, our board of directors will be required to adopt resolutions creating and designating such series of preferred stock.<I> </I></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The following summary of terms of our preferred stock is not complete. You should refer to the provisions of our certificate of incorporation
and bylaws and the resolutions containing the terms of each class or series of the preferred stock which have been or will be filed with the SEC at or prior to the time of issuance of such class or series of preferred stock and described in the
applicable prospectus supplement. The applicable prospectus supplement may also state that any of the terms set forth herein are inapplicable to such series of preferred stock, provided that the information set forth in such prospectus supplement
does not constitute material changes to the information herein such that it alters the nature of the offering or the securities offered. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><I>The Series A Preferred Stock. </I>We have designated 210,000 shares of our preferred stock as Series A Preferred Stock. There are no shares
of Series A Preferred Stock issued and outstanding. Pursuant to the rights of the Series A Preferred Stock, subject to the rights of holders of any shares of any series of preferred stock ranking prior and superior, the holders of Series A Preferred
Stock are entitled to receive, when, as and if declared by our board of directors out of funds legally available for the purpose, quarterly dividends payable in cash on the first day of March, June, September and December in each year, commencing on
the first dividend payment date after the first issuance of a share or fraction of a share of Series A Preferred Stock, in an amount per share equal to the greater of (a)&nbsp;U.S.$1.00 or (b)&nbsp;66 2/3 times the aggregate per share amount of all
cash dividends, plus 66 2/3 times the aggregate per share amount of all non-cash dividends or other distributions, other than a dividend payable in common stock, declared on the common stock since the immediately preceding dividend payment date, or,
with respect to the first dividend payment date, since the first issuance of Series A Preferred Stock.<I> </I></P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">7 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In addition to any other voting rights required by law, holders of Series A Preferred Stock have
the right to vote on all matters submitted to a vote of our stockholders with each share of Series A Preferred Stock entitled to 66 2/3 votes. Except as otherwise provided by law, holders of Series A Preferred Stock and holders of common stock
generally vote together as one class on all matters submitted to a vote of our stockholders. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Unless otherwise provided in the rights
attaching to a subsequently designated series of our preferred stock, the shares of Series A Preferred Stock rank junior to any other series of preferred stock subsequently issued as to the payment of dividends and distribution of assets on
liquidation, dissolution or winding-up and rank senior to the common stock. Upon any liquidation, dissolution or winding-up of us, no distributions shall be made to holders of shares ranking junior to the Series A Preferred Stock unless, prior
thereto, the holders of Series A Preferred Stock shall have received an amount equal to accrued and unpaid dividends and distributions, whether or not declared, to the date of such payment, plus an amount equal to the greater of (1)&nbsp;U.S.
$100.00 per share or (2)&nbsp;an aggregate amount per share equal to 66 2/3 times the aggregate amount to be distributed per share to holders of common stock or to the holders of shares ranking on parity with the Series A Preferred Stock, except
distributions made ratably on the Series A Preferred Stock and all other such parity shares in proportion to the total amount to which the holders of all such shares are entitled upon such liquidation, dissolution or winding-up. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">If we enter into any consolidation, amalgamation, merger, combination or other transaction in which shares of common stock are exchanged for
or changed into cash, other securities and/or any other property, then any shares of Series A Preferred Stock issued and outstanding shall at the same time be similarly exchanged or changed in an amount per share equal to 66 2/3 times the aggregate
amount of cash, securities and/or other property, as the case may be, into which or for which each share of common stock is changed or exchanged. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The Series A Preferred Stock is not redeemable. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><I>Preferred Stock</I>. We will fix the designations, voting powers, preferences and rights of the preferred stock of each series we issue
under this prospectus, as well as the qualifications, limitations or restrictions thereof, in the certificate of designation relating to that series. We will file as an exhibit to the registration statement of which this prospectus is a part, or
will incorporate by reference from reports that we file with the SEC, the form of any certificate of designation that describes the terms of the series of preferred stock we are offering. We will describe in the applicable prospectus supplement the
terms of the series of preferred stock being offered, including, to the extent applicable:<I> </I></P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the title and stated value; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the number of shares we are offering; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the liquidation preference per share; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the purchase price; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the dividend rate, period and payment date and method of calculation for dividends; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">whether dividends will be cumulative or non-cumulative and, if cumulative, the date from which dividends will accumulate; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the procedures for any auction and remarketing; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the provisions for a sinking fund; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the provisions for redemption or repurchase, if applicable, and any restrictions on our ability to exercise those redemption and repurchase rights; </TD></TR></TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">8 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>


<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">any listing of the preferred stock on any securities exchange or market; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">whether the preferred stock will be convertible into our common stock, and, if applicable, the conversion price, or how it will be calculated, and the conversion period; </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">whether the preferred stock will be exchangeable into debt securities, and, if applicable, the exchange price, or how it will be calculated, and the exchange period; </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">voting rights of the preferred stock; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">preemptive rights; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">restrictions on transfer, sale or other assignment; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">whether interests in the preferred stock will be represented by depositary shares; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">a discussion of material United States federal income tax considerations applicable to the preferred stock; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the relative ranking and preferences of the preferred stock as to dividend rights and rights if we liquidate, dissolve or wind up our affairs; </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">any limitations on the issuance of any class or series of preferred stock ranking senior to or on a parity with the series of preferred stock as to dividend rights and rights if we liquidate, dissolve or wind up our
affairs; and </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">any other specific terms, preferences, rights or limitations of, or restrictions on, the preferred stock. </TD></TR></TABLE>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">If we issue shares of preferred stock under this prospectus, the shares will be fully paid and non-assessable. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The issuance of preferred stock could adversely affect the voting power of holders of common stock and reduce the likelihood that common
stockholders will receive dividend payments and payments upon liquidation. The issuance could have the effect of decreasing the market price of the common stock. The issuance of preferred stock also could have the effect of delaying, deterring or
preventing a change in control of us. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Outstanding Warrants </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In September 2012, we issued warrants to purchase 39,346 shares of our common stock to General Electric Capital Corporation in connection with
a loan amendment, which are immediately exercisable at an exercise price of $3.54 per share, and have a five year term. As of June&nbsp;30, 2013, all of these warrants were outstanding. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In March 2012, we issued warrants to purchase 14,834,577 shares of our common stock in connection with an underwritten offering, which are
immediately exercisable at an exercise price of $1.76 per share and have a five-year term. As of June&nbsp;30, 2013, 13,920,530 of these warrants were outstanding. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In December of 2011, we issued warrants in connection with a debt financing, which entitle the holder to purchase up to an aggregate of
263,158 unregistered shares of our common stock at an exercise price equal to $1.14 per share, are immediately exercisable and will expire on December&nbsp;30, 2016. In February of 2010, we issued warrants to purchase 1,260,000 shares of our common
stock in connection with an underwritten offering, which are exercisable beginning six months and one day after issuance and have a five-year term and an exercise price of $10.50 per share. In June of 2009, we issued warrants to certain
institutional investors as part of a registered direct offering, which represent the right to acquire an aggregate of up to 347,826 shares of common stock over a five year period beginning December&nbsp;11, 2009, at an exercise price of $19.50 per
share. As of June&nbsp;30, 2013, all of the warrants issued in December of 2011,&nbsp;February of 2010 and June of 2009 were outstanding. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">9 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Anti-Takeover Effects of Our Charter Documents and Some Provisions of Delaware Law </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><I>Certificate of incorporation and bylaws.</I> Our certificate of incorporation authorizes our board of directors to issue up to 1,000,000
shares of preferred stock without stockholder approval and to set the rights, preferences and other designations, including voting rights, of those shares as the board of directors may determine. In addition, our bylaws require certain procedures to
be followed and time periods to be met for any stockholder to propose matters to be considered at annual meetings of stockholders, including nominating directors for election at those meetings. Our bylaws also provide that our board of directors is
able to elect a director to fill a vacancy created by the expansion of the board of directors or due to the resignation or departure of an existing board member. Provisions of Delaware law and our certificate of incorporation and bylaws could make
the acquisition of our company through a tender offer, a proxy contest or other means more difficult and could make the removal of incumbent officers and directors more difficult. We expect these provisions to discourage coercive takeover practices
and inadequate takeover bids and to encourage persons seeking to acquire control of our company to first negotiate with our board of directors. We believe that the benefits provided by our ability to negotiate with the proponent of an unfriendly or
unsolicited proposal outweigh the disadvantages of discouraging these proposals. We believe the negotiation of an unfriendly or unsolicited proposal could result in an improvement of its terms.<I> </I></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><I>Section&nbsp;203 of the Delaware General Corporation Law</I>. We are subject to Section&nbsp;203 of the DGCL, an anti-takeover law. In
general, Section&nbsp;203 prohibits a publicly held Delaware corporation from engaging in a &#147;business combination&#148; with an &#147;interested stockholder&#148; for a period of three years following the date the person became an interested
stockholder, unless:<I> </I></P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">prior to the date of the transaction, the board of directors of the corporation approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder;
</TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding for purposes of determining the number of shares outstanding (a)&nbsp;shares owned
by persons who are directors and also officers, and (b)&nbsp;shares owned by employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender
or exchange offer; or </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">on or subsequent to the date of the transaction, the business combination is approved by the board and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of
at least 66% of the outstanding voting stock which is not owned by the interested stockholder. </TD></TR></TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Generally, a &#147;business
combination&#148; includes a merger, asset or stock sale, or other transaction resulting in a financial benefit to the interested stockholder. An &#147;interested stockholder&#148; is a person who, together with affiliates and associates, owns or,
within three years prior to the determination of interested stockholder status, did own 15% or more of a corporation&#146;s outstanding voting securities. We expect the existence of this provision to have an anti-takeover effect with respect to
transactions our board of directors does not approve in advance. We also anticipate that Section&nbsp;203 may discourage attempts that might result in a premium over the market price for the shares of common stock held by stockholders. </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Transfer Agent and Registrar </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The
transfer agent and registrar for our common stock is Wells Fargo Shareowner Services. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Listing on the NASDAQ Global Market </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Our common stock is listed on the NASDAQ Global Market under the symbol &#147;XOMA.&#148; </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">10 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="supptoc834930_22"></A><A NAME="toc834930_9"></A>Description of Debt Securities
</B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We may issue debt securities from time to time, in one or more series, as either senior or subordinated debt or as senior or
subordinated convertible debt. While the terms we have summarized below will apply generally to any debt securities that we may offer under this prospectus, we will describe the particular terms of any debt securities that we may offer in more
detail in the applicable prospectus supplement. The terms of any debt securities offered under a prospectus supplement may differ from the terms described below. Unless the context requires otherwise, whenever we refer to the indenture, we also are
referring to any supplemental indentures that specify the terms of a particular series of debt securities. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We will issue the debt
securities under the indenture that we will enter into with the trustee named in the indenture. The indenture will be qualified under the Trust Indenture Act of 1939, as amended, or the Trust Indenture Act. We have filed the form of indenture as an
exhibit to the registration statement of which this prospectus is a part, and supplemental indentures and forms of debt securities containing the terms of the debt securities being offered will be filed as exhibits to the registration statement of
which this prospectus is a part or will be incorporated by reference from reports that we file with the SEC. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The following summary of
material provisions of the debt securities and the indenture is subject to, and qualified in its entirety by reference to, all of the provisions of the indenture applicable to a particular series of debt securities. We urge you to read the
applicable prospectus supplements and any related free writing prospectuses related to the debt securities that we may offer under this prospectus, as well as the complete indenture that contains the terms of the debt securities. </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>General </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The indenture does not limit the
amount of debt securities that we may issue. It provides that we may issue debt securities up to the principal amount that we may authorize and may be in any currency or currency unit that we may designate. Except for the limitations on
consolidation, merger and sale of all or substantially all of our assets contained in the indenture, the terms of the indenture do not contain any covenants or other provisions designed to give holders of any debt securities protection against
changes in our operations, financial condition or transactions involving us. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We may issue the debt securities issued under the indenture
as &#147;discount securities,&#148; which means they may be sold at a discount below their stated principal amount. These debt securities, as well as other debt securities that are not issued at a discount, may be issued with &#147;original issue
discount,&#148; or OID, for U.S. federal income tax purposes because of interest payment and other characteristics or terms of the debt securities. Material U.S. federal income tax considerations applicable to debt securities issued with OID will be
described in more detail in any applicable prospectus supplement. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We will describe in the applicable prospectus supplement the terms of
the series of debt securities being offered, including: </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the title of the series of debt securities; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">any limit upon the aggregate principal amount that may be issued; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the maturity date or dates; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the form of the debt securities of the series; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the applicability of any guarantees; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">whether or not the debt securities will be secured or unsecured, and the terms of any secured debt; </TD></TR></TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">11 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>


<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">whether the debt securities rank as senior debt, senior subordinated debt, subordinated debt or any combination thereof, and the terms of any subordination; </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">if the price (expressed as a percentage of the aggregate principal amount thereof) at which such debt securities will be issued is a price other than the principal amount thereof, the portion of the principal amount
thereof payable upon declaration of acceleration of the maturity thereof, or if applicable, the portion of the principal amount of such debt securities that is convertible into another security or the method by which any such portion shall be
determined; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the interest rate or rates, which may be fixed or variable, or the method for determining the rate and the date interest will begin to accrue, the dates interest will be payable and the regular record dates for interest
payment dates or the method for determining such dates; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">our right, if any, to defer payment of interest and the maximum length of any such deferral period; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">if applicable, the date or dates after which, or the period or periods during which, and the price or prices at which, we may, at our option, redeem the series of debt securities pursuant to any optional or provisional
redemption provisions and the terms of those redemption provisions; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the date or dates, if any, on which, and the price or prices at which we are obligated, pursuant to any mandatory sinking fund or analogous fund provisions or otherwise, to redeem, or at the holder&#146;s option to
purchase, the series of debt securities and the currency or currency unit in which the debt securities are payable; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the denominations in which we will issue the series of debt securities, if other than denominations of $1,000 and any integral multiple thereof; </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">any and all terms, if applicable, relating to any auction or remarketing of the debt securities of that series and any security for our obligations with respect to such debt securities and any other terms which may be
advisable in connection with the marketing of debt securities of that series; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">whether the debt securities of the series shall be issued in whole or in part in the form of a global security or securities; the terms and conditions, if any, upon which such global security or securities may be
exchanged in whole or in part for other individual securities; and the depositary for such global security or securities; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">if applicable, the provisions relating to conversion or exchange of any debt securities of the series and the terms and conditions upon which such debt securities will be so convertible or exchangeable, including the
conversion or exchange price, as applicable, or how it will be calculated and may be adjusted, any mandatory or optional (at our option or the holders&#146; option) conversion or exchange features, the applicable conversion or exchange period and
the manner of settlement for any conversion or exchange; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">if other than the full principal amount thereof, the portion of the principal amount of debt securities of the series which shall be payable upon declaration of acceleration of the maturity thereof; </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">additions to or changes in the covenants applicable to the particular debt securities being issued, including, among others, the consolidation, merger or sale covenant; </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">additions to or changes in the Events of Default with respect to the securities and any change in the right of the trustee or the holders to declare the principal, premium, if any, and interest, if any, with respect to
such securities to be due and payable; </TD></TR></TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">12 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>


<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">additions to or changes in or deletions of the provisions relating to covenant defeasance and legal defeasance; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">additions to or changes in the provisions relating to satisfaction and discharge of the indenture; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">additions to or changes in the provisions relating to the modification of the indenture both with and without the consent of holders of debt securities issued under the indenture; </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the currency of payment of debt securities if other than U.S. dollars and the manner of determining the equivalent amount in U.S. dollars; </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">whether interest will be payable in cash or additional debt securities at our or the holders&#146; option and the terms and conditions upon which the election may be made; </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the terms and conditions, if any, upon which we will pay amounts in addition to the stated interest, premium, if any and principal amounts of the debt securities of the series to any holder that is not a &#147;United
States person&#148; for federal tax purposes; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">any restrictions on transfer, sale or assignment of the debt securities of the series; and </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">any other specific terms, preferences, rights or limitations of, or restrictions on, the debt securities, any other additions or changes in the provisions of the indenture, and any terms that may be required by us or
advisable under applicable laws or regulations. </TD></TR></TABLE> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Conversion or Exchange Rights </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We will set forth in the prospectus supplement the terms on which a series of debt securities may be convertible into or exchangeable for our
common stock or our other securities. We will include provisions as to settlement upon conversion or exchange and whether conversion or exchange is mandatory, at the option of the holder or at our option. We may include provisions pursuant to which
the number of shares of our common stock or our other securities that the holders of the series of debt securities receive would be subject to adjustment. </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Consolidation, Merger or Sale </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Unless we
provide otherwise in the prospectus supplement applicable to a particular series of debt securities, the indenture will not contain any covenant that restricts our ability to merge or consolidate, or sell, convey, transfer or otherwise dispose of
our assets as an entirety or substantially as an entirety. However, any successor to or acquirer of such assets (other than a subsidiary of ours) must assume all of our obligations under the indenture or the debt securities, as appropriate. </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Events of Default Under the Indenture </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Unless we provide otherwise in the prospectus supplement applicable to a particular series of debt securities, the following are events of
default under the indenture with respect to any series of debt securities that we may issue: </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">if we fail to pay any installment of interest on any series of debt securities, as and when the same shall become due and payable, and such default continues for a period of 90 days; provided, however, that a valid
extension of an interest payment period by us in accordance with the terms of any indenture supplemental thereto shall not constitute a default in the payment of interest for this purpose; </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE="font-family:Times New Roman; font-size:10pt">if we fail to pay the principal of, or premium, if any, on any series of debt securities as and when the same shall become due and payable whether at
maturity, upon redemption, by declaration or otherwise, or in any payment required by any sinking or analogous fund established with respect to such series; </P></TD></TR></TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">13 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>


<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="8%">&nbsp;</TD>
<TD VALIGN="top"> <P STYLE="font-family:Times New Roman; font-size:10pt">
provided, however, that a valid extension of the maturity of such debt securities in accordance with the terms of any indenture supplemental thereto shall not constitute a default in the payment
of principal or premium, if any; </P></TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">if we fail to observe or perform any other covenant or agreement contained in the debt securities or the indenture, other than a covenant specifically relating to another series of debt securities, and our failure
continues for 90 days after we receive written notice of such failure, requiring the same to be remedied and stating that such is a notice of default thereunder, from the trustee or holders of at least 25% in aggregate principal amount of the
outstanding debt securities of the applicable series; and </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">if specified events of bankruptcy, insolvency or reorganization occur. </TD></TR></TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">If an event of default
with respect to debt securities of any series occurs and is continuing, other than an event of default specified in the last bullet point above, the trustee or the holders of at least 25% in aggregate principal amount of the outstanding debt
securities of that series, by notice to us in writing, and to the trustee if notice is given by such holders, may declare the unpaid principal of, premium, if any, and accrued interest, if any, due and payable immediately. If an event of default
specified in the last bullet point above occurs with respect to us, the principal amount of and accrued interest, if any, of each issue of debt securities then outstanding shall be due and payable without any notice or other action on the part of
the trustee or any holder. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The holders of a majority in principal amount of the outstanding debt securities of an affected series may
waive any default or event of default with respect to the series and its consequences, except defaults or events of default regarding payment of principal, premium, if any, or interest, unless we have cured the default or event of default in
accordance with the indenture. Any waiver shall cure the default or event of default. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Subject to the terms of the indenture, if an event
of default under an indenture shall occur and be continuing, the trustee will be under no obligation to exercise any of its rights or powers under such indenture at the request or direction of any of the holders of the applicable series of debt
securities, unless such holders have offered the trustee reasonable indemnity. The holders of a majority in principal amount of the outstanding debt securities of any series will have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the trustee, or exercising any trust or power conferred on the trustee, with respect to the debt securities of that series, provided that: </P>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the direction so given by the holder is not in conflict with any law or the applicable indenture; and </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">subject to its duties under the Trust Indenture Act, the trustee need not take any action that might involve it in personal liability or might be unduly prejudicial to the holders not involved in the proceeding.
</TD></TR></TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">A holder of the debt securities of any series will have the right to institute a proceeding under the indenture or to
appoint a receiver or trustee, or to seek other remedies only if: </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the holder has given written notice to the trustee of a continuing event of default with respect to that series; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the holders of at least 25% in aggregate principal amount of the outstanding debt securities of that series have made written request; </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">such holders have offered to the trustee indemnity satisfactory to it against the costs, expenses and liabilities to be incurred by the trustee in compliance with the request; and </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the trustee does not institute the proceeding, and does not receive from the holders of a majority in aggregate principal amount of the outstanding debt securities of that series other conflicting directions within 90
days after the notice, request and offer. </TD></TR></TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">14 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">These limitations do not apply to a suit instituted by a holder of debt securities if we default
in the payment of the principal, premium, if any, or interest on, the debt securities. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We will periodically file statements with the
trustee regarding our compliance with specified covenants in the indenture. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Modification of Indenture; Waiver </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We and the trustee may change an indenture without the consent of any holders with respect to specific matters: </P>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">to cure any ambiguity, defect or inconsistency in the indenture or in the debt securities of any series; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">to comply with the provisions described above under &#147;Description of Debt Securities&#151;Consolidation, Merger or Sale;&#148; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">to provide for uncertificated debt securities in addition to or in place of certificated debt securities; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">to add to our covenants, restrictions, conditions or provisions such new covenants, restrictions, conditions or provisions for the benefit of the holders of all or any series of debt securities, to make the occurrence,
or the occurrence and the continuance, of a default in any such additional covenants, restrictions, conditions or provisions an event of default or to surrender any right or power conferred upon us in the indenture; </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">to add to, delete from or revise the conditions, limitations, and restrictions on the authorized amount, terms, or purposes of issue, authentication and delivery of debt securities, as set forth in the indenture;
</TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">to make any change that does not adversely affect the interests of any holder of debt securities of any series in any material respect; </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">to provide for the issuance of and establish the form and terms and conditions of the debt securities of any series as provided above under &#147;Description of Debt Securities&#151;General&#148; to establish the form
of any certifications required to be furnished pursuant to the terms of the indenture or any series of debt securities, or to add to the rights of the holders of any series of debt securities; </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">to evidence and provide for the acceptance of appointment under any indenture by a successor trustee; or </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">to comply with any requirements of the SEC in connection with the qualification of any indenture under the Trust Indenture Act. </TD></TR></TABLE>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In addition, under the indenture, the rights of holders of a series of debt securities may be changed by us and the trustee with the written
consent of the holders of at least a majority in aggregate principal amount of the outstanding debt securities of each series that is affected. However, unless we provide otherwise in the prospectus supplement applicable to a particular series of
debt securities, we and the trustee may make the following changes only with the consent of each holder of any outstanding debt securities affected: </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">extending the fixed maturity of any debt securities of any series; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">reducing the principal amount, reducing the rate of or extending the time of payment of interest, or reducing any premium payable upon the redemption of any series of any debt securities; or </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">reducing the percentage of debt securities, the holders of which are required to consent to any amendment, supplement, modification or waiver. </TD></TR></TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">15 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Discharge </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Each indenture provides that we can elect to be discharged from our obligations with respect to one or more series of debt securities, except
for specified obligations, including obligations to: </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">provide for payment; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">register the transfer or exchange of debt securities of the series; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">replace stolen, lost or mutilated debt securities of the series; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">pay principal of and premium and interest on any debt securities of the series; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">maintain paying agencies; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">hold monies for payment in trust; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">recover excess money held by the trustee; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">compensate and indemnify the trustee; and </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">appoint any successor trustee. </TD></TR></TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In order to exercise our rights to be discharged, we must
deposit with the trustee money or government obligations sufficient to pay all the principal of, any premium, if any, and interest on, the debt securities of the series on the dates payments are due. </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Form, Exchange and Transfer </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We will
issue the debt securities of each series only in fully registered form without coupons and, unless we provide otherwise in the applicable prospectus supplement, in denominations of $1,000 and any integral multiple thereof. The indenture provides
that we may issue debt securities of a series in temporary or permanent global form and as book-entry securities that will be deposited with, or on behalf of, The Depository Trust Company, or DTC, or another depositary named by us and identified in
a prospectus supplement with respect to that series. To the extent the debt securities of a series are issued in global form and as book-entry, a description of terms relating will be set forth in the applicable prospectus supplement. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">At the option of the holder, subject to the terms of the indenture and the limitations applicable to global securities described in the
applicable prospectus supplement, the holder of the debt securities of any series can exchange the debt securities for other debt securities of the same series, in any authorized denomination and of like tenor and aggregate principal amount. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Subject to the terms of the indenture and the limitations applicable to global securities set forth in the applicable prospectus supplement,
holders of the debt securities may present the debt securities for exchange or for registration of transfer, duly endorsed or with the form of transfer endorsed thereon duly executed if so required by us or the security registrar, at the office of
the security registrar or at the office of any transfer agent designated by us for this purpose. Unless otherwise provided in the debt securities that the holder presents for transfer or exchange, we will impose no service charge for any
registration of transfer or exchange, but we may require payment of any taxes or other governmental charges. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We will name in the
applicable prospectus supplement the security registrar, and any transfer agent in addition to the security registrar, that we initially designate for any debt securities. We may at any time designate additional transfer agents or rescind the
designation of any transfer agent or approve a change in the office through which any transfer agent acts, except that we will be required to maintain a transfer agent in each place of payment for the debt securities of each series. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">16 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">If we elect to redeem the debt securities of any series, we will not be required to: </P>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="1%">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">issue, register the transfer of, or exchange any debt securities of that series during a period beginning at the opening of business 15 days before the day of mailing of a notice of redemption of any debt securities
that may be selected for redemption and ending at the close of business on the day of the mailing; or </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="1%">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">register the transfer of or exchange any debt securities so selected for redemption, in whole or in part, except the unredeemed portion of any debt securities we are redeeming in part. </TD></TR></TABLE>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Information Concerning the Trustee </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The
trustee, other than during the occurrence and continuance of an event of default under an indenture, undertakes to perform only those duties as are specifically set forth in the applicable indenture. Upon an event of default under an indenture, the
trustee must use the same degree of care as a prudent person would exercise or use in the conduct of his or her own affairs. Subject to this provision, the trustee is under no obligation to exercise any of the powers given it by the indenture at the
request of any holder of debt securities unless it is offered reasonable security and indemnity against the costs, expenses and liabilities that it might incur. </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Payment and Paying Agents </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Unless we
otherwise indicate in the applicable prospectus supplement, we will make payment of the interest on any debt securities on any interest payment date to the person in whose name the debt securities, or one or more predecessor securities, are
registered at the close of business on the regular record date for the interest. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We will pay principal of and any premium and interest on
the debt securities of a particular series at the office of the paying agents designated by us, except that unless we otherwise indicate in the applicable prospectus supplement, we will make interest payments by check that we will mail to the holder
or by wire transfer to certain holders. Unless we otherwise indicate in the applicable prospectus supplement, we will designate the corporate trust office of the trustee as our sole paying agent for payments with respect to debt securities of each
series. We will name in the applicable prospectus supplement any other paying agents that we initially designate for the debt securities of a particular series. We will maintain a paying agent in each place of payment for the debt securities of a
particular series. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">All money we pay to a paying agent or the trustee for the payment of the principal of or any premium or interest on
any debt securities that remains unclaimed at the end of two years after such principal, premium or interest has become due and payable will be repaid to us, and the holder of the debt security thereafter may look only to us for payment thereof.
</P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Governing Law </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The indenture and the
debt securities will be governed by and construed in accordance with the laws of the State of New York, except to the extent that the Trust Indenture Act is applicable. </P>
<P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="supptoc834930_23"></A><A NAME="toc834930_10"></A>Description of Warrants </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We may issue warrants for the purchase of common stock, preferred stock and/or debt securities in one or more series. We may issue warrants
independently or together with common stock, preferred stock and/or debt securities, and the warrants may be attached to or separate from these securities. While the terms summarized below will apply generally to any warrants that we may offer, we
will describe the particular terms of any series of warrants in more detail in the applicable prospectus supplement. The terms of any warrants offered under a prospectus supplement may differ from the terms described below. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">17 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Warrants issued under this prospectus may be issued under warrant agreements which we will enter
into with a warrant agent to be selected by us. We use the term &#147;warrant agreement&#148; to refer to any of these warrant agreements. We use the term &#147;warrant agent&#148; to refer to the warrant agent under any of these warrant agreements.
The warrant agent will act solely as an agent of ours in connection with the warrants and will not act as an agent for the holders or beneficial owners of the warrants. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The following summaries of material provisions of the warrants and the warrant agreements are subject to, and qualified in their entirety by
reference to, all the provisions of the warrant agreement applicable to a particular series of warrants. We urge you to read the applicable prospectus supplements or free writing prospectus related to the warrants that we sell under this prospectus,
as well as the complete warrant agreements that contain the terms of the warrants. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>General </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We will describe in the applicable prospectus supplement the terms of the series of warrants being offered, including, to the extent
applicable: </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the offering price and aggregate number of warrants offered; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the currency for which the warrants may be purchased; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the designation and terms of the securities with which the warrants are issued and the number of warrants issued with each such security or each principal amount of such security; </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the date on and after which the warrants and the related securities will be separately transferable; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">in the case of warrants to purchase debt securities, the principal amount of debt securities purchasable upon exercise of one warrant and the price at, and currency in which, this principal amount of debt securities may
be purchased upon such exercise; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">in the case of warrants to purchase common stock or preferred stock, the number of shares of common stock or preferred stock, as the case may be, purchasable upon the exercise of one warrant and the price at which these
shares may be purchased upon such exercise; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the effect of any merger, consolidation, sale or other disposition of our business on the warrant agreements and the warrants; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the terms of any rights to redeem or call the warrants; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">any provisions for changes to or adjustments in the exercise price or number of securities issuable upon exercise of the warrants; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the dates on which the right to exercise the warrants will commence and expire; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the manner in which the warrant agreements and warrants may be modified; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">a discussion of material United States federal income tax consequences of holding or exercising the warrants; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the terms of the securities issuable upon exercise of the warrants; and </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">any other specific terms, preferences, rights or limitations of or restrictions on the warrants. </TD></TR></TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">18 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Before exercising their warrants, holders of warrants will not have any of the rights of holders
of the securities purchasable upon such exercise, including: </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">in the case of warrants to purchase debt securities, the right to receive payments of principal of, or premium, if any, or interest on, the debt securities purchasable upon exercise or to enforce covenants in the
applicable indenture; or </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">in the case of warrants to purchase common stock or preferred stock, the right to receive dividends, if any, or, payments upon our liquidation, dissolution or winding up or to exercise voting rights, if any.
</TD></TR></TABLE> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Exercise of Warrants </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Each warrant will entitle the holder to purchase the securities that we specify in the applicable prospectus supplement at the exercise price
that we describe in the applicable prospectus supplement. Unless we otherwise specify in the applicable prospectus supplement, holders of the warrants may exercise the warrants at any time up to the specified time on the expiration date that we set
forth in the applicable prospectus supplement. After the close of business on the expiration date, unexercised warrants will become void. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Holders of the warrants may exercise the warrants by delivering the warrant or warrant certificate representing the warrants to be exercised
together with specified information, and paying the required amount to the warrant agent, if applicable, in immediately available funds, as provided in the applicable prospectus supplement. We will set forth on the reverse side of any warrant
certificate and in the applicable prospectus supplement the information that the holder of the warrant will be required to deliver to any warrant agent. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Upon receipt of the required payment and any warrant certificate properly completed and duly executed at the corporate trust office of any
warrant agent or any other office indicated in the applicable prospectus supplement, we will issue and deliver the securities purchasable upon such exercise. If fewer than all of the warrants represented by a warrant certificate are exercised, then
we will issue a new warrant certificate for the remaining amount of warrants. If we so indicate in the applicable prospectus supplement, holders of the warrants may surrender securities as all or part of the exercise price for warrants. </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Governing Law </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Unless we provide
otherwise in the applicable prospectus supplement, the warrants and warrant agreements will be governed by and construed in accordance with the laws of the State of New York. </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Enforceability of Rights by Holders of Warrants </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Any warrant agent will act solely as our agent under the applicable warrant agreement and will not assume any obligation or relationship of
agency or trust with any holder of any warrant. A single bank or trust company may act as warrant agent for more than one issue of warrants. A warrant agent will have no duty or responsibility in case of any default by us under the applicable
warrant agreement or warrant, including any duty or responsibility to initiate any proceedings at law or otherwise, or to make any demand upon us. Any holder of a warrant may, without the consent of any related warrant agent or the holder of any
other warrant, enforce by appropriate legal action its right to exercise, and receive the securities purchasable upon exercise of, its warrants. </P>
<P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="supptoc834930_24"></A><A NAME="toc834930_11"></A>Legal Ownership of Securities </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We can issue securities in registered form or in the form of one or more global securities. We describe global securities in greater detail
below. We refer to those persons who have securities registered in their own names on the books that we or any applicable trustee, depositary or warrant agent maintain for this purpose as the &#147;holders&#148; of those securities. These persons
are the legal holders of the securities. We refer to those persons who, indirectly through others, own beneficial interests in securities that are not registered in their own names, as &#147;indirect holders&#148; of those securities. As we discuss
below, indirect holders are not legal holders, and investors in securities issued in book-entry form or in street name will be indirect holders. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">19 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Book-Entry Holders </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We may issue securities in book-entry form only, as we will specify in the applicable prospectus supplement. This means securities may be
represented by one or more global securities registered in the name of a financial institution that holds them as depositary on behalf of other financial institutions that participate in the depositary&#146;s book-entry system. These participating
institutions, which are referred to as participants, in turn, hold beneficial interests in the securities on behalf of themselves or their customers. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Only the person in whose name a security is registered is recognized as the holder of that security. Securities issued in global form will be
registered in the name of the depositary or its participants. Consequently, for securities issued in global form, we will recognize only the depositary as the holder of the securities, and we will make all payments on the securities to the
depositary. The depositary passes along the payments it receives to its participants, which in turn pass the payments along to their customers who are the beneficial owners. The depositary and its participants do so under agreements they have made
with one another or with their customers; they are not obligated to do so under the terms of the securities. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">As a result, investors in a
book-entry security will not own securities directly. Instead, they will own beneficial interests in a global security, through a bank, broker or other financial institution that participates in the depositary&#146;s book-entry system or holds an
interest through a participant. As long as the securities are issued in global form, investors will be indirect holders, and not holders, of the securities. </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Street Name Holders </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We may terminate a
global security or issue securities in non-global form. In these cases, investors may choose to hold their securities in their own names or in &#147;street name.&#148; Securities held by an investor in street name would be registered in the name of
a bank, broker or other financial institution that the investor chooses, and the investor would hold only a beneficial interest in those securities through an account he or she maintains at that institution. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">For securities held in street name, we will recognize only the intermediary banks, brokers and other financial institutions in whose names the
securities are registered as the holders of those securities, and we will make all payments on those securities to them. These institutions pass along the payments they receive to their customers who are the beneficial owners, but only because they
agree to do so in their customer agreements or because they are legally required to do so. Investors who hold securities in street name will be indirect holders, not holders, of those securities. </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Legal Holders </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Our obligations, as well
as the obligations of any applicable trustee and of any third parties employed by us or a trustee, run only to the legal holders of the securities. We do not have obligations to investors who hold beneficial interests in global securities, in street
name or by any other indirect means. This will be the case whether an investor chooses to be an indirect holder of a security or has no choice because we are issuing the securities only in global form. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">For example, once we make a payment or give a notice to the holder, we have no further responsibility for the payment or notice even if that
holder is required, under agreements with depositary participants or customers or by law, to pass it along to the indirect holders but does not do so. Similarly, we may want to obtain the approval of the holders to amend an indenture, to relieve us
of the consequences of a default or of our obligation to comply with a particular provision of the indenture or for other purposes. In such an event, we would seek approval only from the holders, and not the indirect holders, of the securities.
Whether and how the holders contact the indirect holders is up to the holders. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Special Considerations for Indirect Holders </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">If you hold securities through a bank, broker or other financial institution, either in book-entry form or in street name, you should check
with your own institution to find out: </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">how it handles securities payments and notices; </TD></TR></TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">20 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>


<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">whether it imposes fees or charges; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">how it would handle a request for the holders&#146; consent, if ever required; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">whether and how you can instruct it to send you securities registered in your own name so you can be a holder, if that is permitted in the future; </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">how it would exercise rights under the securities if there were a default or other event triggering the need for holders to act to protect their interests; and </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">if the securities are in book-entry form, how the depositary&#146;s rules and procedures will affect these matters. </TD></TR></TABLE>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Global Securities </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">A global security is a
security that represents one or any other number of individual securities held by a depositary. Generally, all securities represented by the same global securities will have the same terms. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Each security issued in book-entry form will be represented by a global security that we deposit with and register in the name of a financial
institution or its nominee that we select. The financial institution that we select for this purpose is called the depositary. Unless we specify otherwise in the applicable prospectus supplement, DTC will be the depositary for all securities issued
in book-entry form. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">A global security may not be transferred to or registered in the name of anyone other than the depositary, its
nominee or a successor depositary, unless special termination situations arise. We describe those situations below under &#147;Special Situations When a Global Security Will Be Terminated.&#148; As a result of these arrangements, the depositary, or
its nominee, will be the sole registered owner and holder of all securities represented by a global security, and investors will be permitted to own only beneficial interests in a global security. Beneficial interests must be held by means of an
account with a broker, bank or other financial institution that in turn has an account with the depositary or with another institution that does. Thus, an investor whose security is represented by a global security will not be a holder of the
security, but only an indirect holder of a beneficial interest in the global security. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">If the prospectus supplement for a particular
security indicates that the security will be issued in global form only, then the security will be represented by a global security at all times unless and until the global security is terminated. If termination occurs, we may issue the securities
through another book-entry clearing system or decide that the securities may no longer be held through any book-entry clearing system. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Special
Considerations for Global Securities </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The rights of an indirect holder relating to a global security will be governed by the account
rules of the investor&#146;s financial institution and of the depositary, as well as general laws relating to securities transfers. We do not recognize an indirect holder as a holder of securities and instead deal only with the depositary that holds
the global security. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">If securities are issued only in the form of a global security, an investor should be aware of the following: </P>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">an investor cannot cause the securities to be registered in his or her name, and cannot obtain non-global certificates for his or her interest in the securities, except in the special situations we describe below;
</TD></TR></TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">21 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>


<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">an investor will be an indirect holder and must look to his or her own bank, broker or other financial institution for payments on the securities and protection of his or her legal rights relating to the securities, as
we describe above; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">an investor may not be able to sell interests in the securities to some insurance companies and to other institutions that are required by law to own their securities in non-book-entry form; </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">an investor may not be able to pledge his or her interest in a global security in circumstances where certificates representing the securities must be delivered to the lender or other beneficiary of the pledge in order
for the pledge to be effective; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the depositary&#146;s policies, which may change from time to time, will govern payments, transfers, exchanges and other matters relating to an investor&#146;s interest in a global security; </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">we and any applicable trustee have no responsibility for any aspect of the depositary&#146;s actions or for its records of ownership interests in a global security, nor do we or any applicable trustee supervise the
depositary in any way; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the depositary may, and we understand that DTC will, require that those who purchase and sell interests in a global security within its book-entry system use immediately available funds, and your bank, broker or other
financial institution may require you to do so as well; and </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">financial institutions that participate in the depositary&#146;s book-entry system, and through which an investor holds its interest in a global security, may also have their own policies affecting payments, notices and
other matters relating to the securities. </TD></TR></TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">There may be more than one financial intermediary in the chain of ownership for
an investor. We do not monitor and are not responsible for the actions of any of those intermediaries. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Special Situations When a Global Security Will
Be Terminated </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In a few special situations described below, the global security will terminate and interests in it will be exchanged
for physical certificates representing those interests. After that exchange, the choice of whether to hold securities directly or in street name will be up to the investor. Investors must consult their own banks, brokers or other financial
institutions to find out how to have their interests in securities transferred to their own name, so that they will be direct holders. We have described the rights of holders and street name investors above. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Unless we provide otherwise in the applicable prospectus supplement, the global security will terminate when the following special situations
occur: </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">if the depositary notifies us that it is unwilling, unable or no longer qualified to continue as depositary for that global security and we do not appoint another institution to act as depositary within 90 days;
</TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">if we notify any applicable trustee that we wish to terminate that global security; or </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">if an event of default has occurred with regard to securities represented by that global security and has not been cured or waived. </TD></TR></TABLE>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The prospectus supplement may also list additional situations for terminating a global security that would apply only to the particular series
of securities covered by the applicable prospectus supplement. When a global security terminates, the depositary, and not we or any applicable trustee, is responsible for deciding the names of the institutions that will be the initial direct
holders. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">22 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="supptoc834930_25"></A><A NAME="toc834930_12"></A>Plan of Distribution </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We may sell our securities covered by this prospectus in any of three ways (or in any combination): </P>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">to or through underwriters or dealers; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">directly to one or more purchasers; or </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">through agents. </TD></TR></TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We may distribute the securities: </P>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">from time to time in one or more transactions at a fixed price or prices, which may be changed from time to time; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">at market prices prevailing at the time of sale; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">at prices related to the prevailing market prices; or </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">at negotiated prices. </TD></TR></TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Each time we offer and sell securities covered by this prospectus, we
will provide a prospectus supplement or supplements that will describe the method of distribution and set forth the terms of the offering, including: </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the name or names of any underwriters, dealers or agents; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the amounts of securities underwritten or purchased by each of them; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the purchase price of securities and the proceeds we will receive from the sale; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">any over-allotment options under which underwriters may purchase additional securities from us; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">any underwriting discounts or commissions or agency fees and other items constituting underwriters&#146; or agents&#146; compensation; </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the public offering price of the securities; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">any discounts, commissions or concessions allowed or reallowed or paid to dealers; and </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">any securities exchange or market on which the securities may be listed. </TD></TR></TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Any public offering
price and any discounts or concessions allowed or reallowed or paid to dealers may be changed from time to time. We may determine the price or other terms of the securities offered under this prospectus by use of an electronic auction. We will
describe how any auction will determine the price or any other terms, how potential investors may participate in the auction and the nature of the obligations of the underwriter, dealer or agent in the applicable prospectus supplement. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">23 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Underwriters or dealers may offer and sell the offered securities from time to time in one or
more transactions, including negotiated transactions, at a fixed public offering price or at varying prices determined at the time of sale. If underwriters or dealers are used in the sale of any securities, the securities will be acquired by the
underwriters or dealers for their own account and may be resold from time to time in one or more transactions described above. The securities may be either offered to the public through underwriting syndicates represented by managing underwriters,
or directly by underwriters or dealers. Generally, the underwriters&#146; or dealers&#146; obligations to purchase the securities will be subject to certain conditions precedent. The underwriters or dealers will be obligated to purchase all of the
securities if they purchase any of the securities, unless otherwise specified in the prospectus supplement. We may use underwriters with whom we have a material relationship. We will describe the nature of any such relationship in the prospectus
supplement, naming the underwriter. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We may sell the securities through agents from time to time. The prospectus supplement will name any
agent involved in the offer or sale of the securities and any commissions we pay to them. Generally, any agent will be acting on a best efforts basis for the period of its appointment. We may authorize underwriters, dealers or agents to solicit
offers by certain purchasers to purchase the securities from us at the public offering price set forth in the prospectus supplement pursuant to delayed delivery contracts providing for payment and delivery on a specified date in the future. The
contracts will be subject only to those conditions set forth in the prospectus supplement, and the prospectus supplement will set forth any commissions we pay for solicitation of these contracts. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Agents, dealers and underwriters may be entitled to indemnification by us against certain civil liabilities, including liabilities under the
Securities Act, or to contribution with respect to payments which the agents, dealers or underwriters may be required to make in respect thereof. Agents, dealers and underwriters may be customers of, engage in transactions with, or perform services
for us in the ordinary course of business. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">All securities we may offer, other than common stock, will be new issues of securities with no
established trading market. Any underwriters may make a market in these securities, but will not be obligated to do so and may discontinue any market making at any time without notice. We cannot guarantee the liquidity of the trading markets for any
securities. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Any underwriter may engage in overallotment, stabilizing transactions, short covering transactions and penalty bids in
accordance with Regulation M under the Securities Exchange Act of 1934, as amended. Overallotment involves sales in excess of the offering size, which create a short position. This short sales position may involve either &#147;covered&#148; short
sales or &#147;naked&#148; short sales. Covered short sales are short sales made in an amount not greater than the underwriters&#146; over-allotment option to purchase additional securities in this offering described above. The underwriters may
close out any covered short position either by exercising their over-allotment option or by purchasing securities in the open market. To determine how they will close the covered short position, the underwriters will consider, among other things,
the price of securities available for purchase in the open market, as compared to the price at which they may purchase securities through the over-allotment option. Naked short sales are short sales in excess of the over-allotment option. The
underwriters must close out any naked short position by purchasing securities in the open market. A naked short position is more likely to be created if the underwriters are concerned that, in the open market after pricing, there may be downward
pressure on the price of the securities that could adversely affect investors who purchase securities in this offering. Stabilizing transactions permit bids to purchase the underlying security for the purpose of fixing the price of the security so
long as the stabilizing bids do not exceed a specified maximum. Penalty bids permit the underwriters to reclaim a selling concession from a dealer when the securities originally sold by the dealer are purchased in a covering transaction to cover
short positions. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Any underwriters who are qualified market makers on the NASDAQ Global Market may engage in passive market making
transactions in our common stock, preferred stock, warrants and debt securities, as applicable, on the NASDAQ Global Market in accordance with Rule 103 of Regulation M, during the business day prior to the pricing of the offering, before the
commencement of offers or sales of the securities. Passive market makers must comply with applicable volume and price limitations and must be identified as passive market makers. In general, a passive market maker must display its bid at a price not
in excess of the highest independent bid for such security; if all independent bids are lowered below the passive market maker&#146;s bid, however, the passive market maker&#146;s bid must then be lowered when certain purchase limits are exceeded.
</P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">24 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In compliance with guidelines of the Financial Industry Regulatory Authority, or FINRA, the
maximum consideration or discount to be received by any FINRA member or independent broker dealer may not exceed 8% of the aggregate amount of the securities offered pursuant to this prospectus and any applicable prospectus supplement. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Similar to other purchase transactions, an underwriter&#146;s purchase to cover the syndicate short sales or to stabilize the market price of
our securities may have the effect of raising or maintaining the market price of our securities or preventing or mitigating a decline in the market price of our securities. As a result, the price of our securities may be higher than the price that
might otherwise exist in the open market. The imposition of a penalty bid might also have an effect on the price of the securities if it discourages resales of the securities. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Neither we nor the underwriters make any representation or prediction as to the effect that the transactions described above may have on the
price of the securities. If such transactions are commenced, they may be discontinued without notice at any time. </P> <P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="supptoc834930_26">
</A><A NAME="toc834930_13"></A>Legal Matters </B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The validity of the securities being offered hereby will be passed upon for us by Cooley
LLP, Palo Alto, California. </P> <P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="supptoc834930_27"></A><A NAME="toc834930_14"></A>Experts </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Ernst&nbsp;&amp; Young LLP, independent registered public accounting firm, has audited our consolidated financial statements included in our
Annual Report on Form 10-K for the year ended December&nbsp;31, 2012, as set forth in their report, which is incorporated by reference in this prospectus and elsewhere in the registration statement. Our financial statements are incorporated by
reference in reliance on Ernst&nbsp;
&amp; Young LLP&#146;s report, given on their authority as experts in accounting and auditing. </P> <P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="supptoc834930_28"></A><A NAME="toc834930_15">
</A>Where You Can Find More Information </B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We file annual, quarterly and current reports, proxy statements and other information with
the SEC. You may read and copy any document we file with the SEC at the SEC&#146;s public reference room at 100 F Street, N.E., Washington, D.C., 20549. Please call the SEC at 1.800.SEC.0330 for further information on the operation of the public
reference room. Our SEC filings are also available to the public at the SEC&#146;s website at http://www.sec.gov. </P> <P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><A NAME="supptoc834930_29">
</A><A NAME="toc834930_16"></A>Incorporation of Certain Information by Reference </B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The SEC allows us to &#147;incorporate by
reference&#148; the information we file with it, which means that we can disclose important information to you by referring you to those documents instead of having to repeat the information in this prospectus. The information incorporated by
reference is considered to be part of this prospectus, and later information that we file with the SEC will automatically update and supersede this information. We incorporate by reference the documents listed below and any future filings (including
those made after the date of the initial filing of the registration statement of which this prospectus is a part and prior to the effectiveness of such registration statement) we will make with the SEC under Sections 13(a), 13(c), 14, or 15(d) of
the Exchange Act until the termination of the offering of the shares covered by this prospectus (other than information furnished under Item&nbsp;2.02 or Item&nbsp;7.01 of Form&nbsp;8-K): </P>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">our annual report on Form 10-K for the year ended December&nbsp;31, 2012, filed with the SEC on March&nbsp;12, 2013, including the information specifically incorporated by reference therein from our definitive proxy
statement on Schedule 14A, filed on April&nbsp;11, 2013; </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">our quarterly reports on Form 10-Q for the fiscal quarters ended March&nbsp;31, 2013, and June&nbsp;30, 2013, filed with the SEC on May&nbsp;8, 2013, and August&nbsp;7, 2013, respectively; </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">our current reports on Form 8-K, filed with the SEC on March&nbsp;21, 2013 and August&nbsp;21, 2013; and </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">the description of our capital stock included under the caption &#147;Description of Capital Stock&#148; in the prospectus dated December&nbsp;16, 2011, which was filed on December&nbsp;19, 2011, and is part of our
registration statement on Form S-4/A filed on December&nbsp;13, 2011 (registration no. 333-177165), including any amendment or report for the purpose of updating such description. </TD></TR></TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">25 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">You can request a copy of these filings, at no cost, by writing or telephoning us at the
following address or telephone number: </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">XOMA Corporation </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">2910 Seventh Street </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">Berkeley,
California 94710 </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">(510) 204-7200 </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">Attn: Chief Financial Officer </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">This prospectus is part of a registration statement we filed with the SEC. That registration statement and the exhibits filed along with the
registration statement contain more information about us and the shares in this offering. Because information about documents referred to in this prospectus is not always complete, you should read the full documents which are filed as exhibits to
the registration statement. You may read and copy the full registration statement and its exhibits at the SEC&#146;s public reference rooms or its website. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">26 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">
<h5 align="left"><a href="#toc">Table of Contents</a></h5>

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:16pt; font-family:Times New Roman" ALIGN="center"><B>8,097,165 Shares of Common Stock </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:14pt; font-family:Times New Roman" ALIGN="center"><B>Warrants to Purchase 8,097,165 Shares of Common Stock </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P> <P STYLE="margin-top:0pt;margin-bottom:0pt" ALIGN="center">


<IMG SRC="g834930bc_pg001.jpg" ALT="LOGO">
 </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><I>Sole Placement Agent </I></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:14pt; font-family:Times New Roman" ALIGN="center"><B>Cowen and Company </B></P>
</BODY></HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>GRAPHIC
<SEQUENCE>2
<FILENAME>g834930bc_pg001.jpg
<DESCRIPTION>GRAPHIC
<TEXT>
begin 644 g834930bc_pg001.jpg
M_]C_X``02D9)1@`!`@``9`!D``#_[``11'5C:WD``0`$````9```_^X`#D%D
M;V)E`&3``````?_;`(0``0$!`0$!`0$!`0$!`0$!`0$!`0$!`0$!`0$!`0$!
M`0$!`0$!`0$!`0$!`0("`@("`@("`@("`P,#`P,#`P,#`P$!`0$!`0$"`0$"
M`@(!`@(#`P,#`P,#`P,#`P,#`P,#`P,#`P,#`P,#`P,#`P,#`P,#`P,#`P,#
M`P,#`P,#`P,#_\``$0@`A0"1`P$1``(1`0,1`?_$`+4```$!"0$`````````
M```````*`0(#!`4&!P@)"P$!```'`0$```````````````$"`P0%!@<("1``
M`0,#`@0#!`<$!P4)`````0(#!!$%!@`'(1(("3%!$U$B%`IA<8$R0A46D2,7
M&+'!4F(SDR3PH='ADM)#4]-4E"5E.1$``0,#`@0#!@4$`@,!`````0`"`Q$$
M!2$&,4$2!U%Q$V&1(C(4"(&AT2,5\+'!,_$TX4(D%O_:``P#`0`"$0,1`#\`
M7\:(C1$:(C1$:(C1$Z33QU1DX_@HA2SJT\J@2`!QJ>-*>P?B5[!JV8^!E77-
M!&/'@H&,S?!K16M=\@MMHCAZ?<(T-O[P7)<0PH@>1C+(<<K_`'>/T:T[/]QL
M)A@8HWMZO/FKB'$O>:`56$[IU`V1,A;6/V2\9$6I"8SS\=KX:(I=>50C!^CJ
MU<WFH)33CKF]SW#N;_XK`ETI.G_"RL>'="/6<*"BN*#?]S,B:+]MQ^R8VPM:
M?1.1RGY;SB3QJTS#0&T&GDI0&LEB7Y_+3B2;JZ2H3!C&T/'V++]E;N#<5K\R
M?9D333X@QD^E%0K\7H!7O$:[)C&MMH!#*?W5BY9&N-`J_K)*W1HB-$1HB-$1
MHB-$1HB-$1HB-$3..J9#^14=%!?4M"4E*@D<WODTX)H3PKJHTL8"93RT46NC
M;_L_!4.XW=J"P]/F2$PK?%25OR)!0AI*`#[Y4JE!6FM<W'EH-O8]V:OI6MM&
M"I83J0HPV5Y=3M9"=#RYE:N9OOS<;A,=LVV@MUS3;D*D7_*[@Z&<:L+2:<CD
MF3PYW"#[J4FI.O)FZN_]OEVO9ACZ<+7]/3QJ?%=`Q>!M;=HDOVZD<*T5C8A@
MU\W!R5=\E3;C=+:EAQY_+;J5%MV0MHT_2-N=_P!.J"E?`.K25!/%)KK!X'9V
M>WY<MO2YYA)J>*JY":PLV_L``\`/ZX+:_$=OL<Q*,$VR*\X_)_?RKI*<,B;,
M?-*EQUPE81[$BB1KT[MS8.#VY:-=>0%]TT#4D\5J-YE;B4&.HZ>0Y*]O20%!
M2DI/$&I0"00/%*N!!UOUK=V,(Z;6#H6%,\SM*J:+E`DI\J4^C5665E?JI(R0
MW6BI?N]5.2?#SH'$5'F>'AYZA;Y/ZIX#(G!OB5.X/&NE%%;=YZ<?Z/#[-9.2
M-U`6FBD$HKTGBIC154:(C1$:(C1$:(C1$:(F'5-]:BBBH1>1[WO`E(J$^=!]
M[ZR-32O;"SJ?R4%:F2Y-:[!9YEVNDKTX,5M3RG.5`("?P(235U0]GLUS;=V]
M[#!XZ6^GD#?2:7-!TZB.0\5D<=BYLK<"W@%7<?*FJT$RC<+(-XI=W?3<OR#;
M"Q)5^<3@LA<J&W7G<*!P4LCW>0>VNOG'O+N[NWN1N)UJUSX\/&^G3P!`*[#B
ML1:8>UK,T>N:TKQ)I7CR"R!M=MA"SZ`S(7`%KVL24_E=A:"H[^6+9(].[7IY
M-'Y#*%I*DM+]TUUW?M;V9L=Q7C,K=?#9M8:@\W>*U7<&8B:##'3U*\?!;E0[
M5'M[#<2)%3"BQ([<6(AE*4M,1FP$AEIH`)2GE%->O<+A6;4B$%DP&("G!:)-
M=/E&IXFI\U.^JPPA*G%\B`.1!(H*?0/"IUFY<I"&&YNAH.16/`<7U=P5H9+G
M^*8TW6[7:.TIP'TXL=+LZ8ZH?A9C14NN*6H>5-:]D-YVULP_3Q5</9^BNHXN
MIW)8W_C2[*"WK3MMG]QA()#4P6I,>.^1X*1\0XAX`_2G6@93NGD;2)\D5L]S
M&C44X_DK]EII6H)`5M7'J4M5D<2G(,+S2S1UJ#:IDBWE;#2U4%'"@$<J?,^S
M6`=]PC+&R]2\M#&0.)%%D+?%ON1\-/<LRX)N%C><6L7.Q3VI$;F*%44/B&UI
M/%+C)-4ZWK8'=*PWIUEC@'`<*JPR.&?;N!`/^%D9+H6$J!X*\/V:Z;'<=96)
M*C:OP:BJ@C441HB-$1HB-$1HBAK4H%-*4XU_9PU+KU@<E*>KJ%/DYJW[I);A
ML.R7EAIIIIQR0X5\@;80GF<<2H\!RH%?IUJ6\L]9X*T=<WS@V`,KQHIA#<74
M[(K"C@2*_CX>U<Y]P\TN>]N<1L3L#SXQ]A4B/&D,+<:8])H$/WR53@&8]"@I
M5]ZNOF+W+[A;EWMO"WP]FYO_`.9CG#G%O$BNM3X47?L+A+#;6'9EF5.3D^%X
M/"G@!X^"JV.XS'S;,8FW5BCKCX-@[S?ZED1'4ICY#,8;0K_6J0DB2Q,<42@>
M%$G67V?MT[F[@P8FRC`P[:=1:-30ZDE8O,91QM72S'XW<!2E*\&@?W70.TVZ
M+!A1(L%EJ+$9CMM1X\=(0PRTW[H0VV``D<HU]&<1MNQP;&V=@7,B:T+C]Y(7
MSFI)-57#2J02JH20`#P/#B5>-2-;<R<L9T$`^:MN"MJZV=^[J:"YSL5IA=4I
MBK#3B^`X+)"P0H<#]&L9=64-T2Z2M?R4*E.P,1L4%]<V/:X+4Y?WI0:YGU'^
MV'5J4IM9]J::MH\-8$CJ8%6;*YHTHJK\+1KG"$UX\%%2@#4T4.<JH1[1K(18
M?$M-988RWVBJEGO)VPN+-7@:*@7FS6ZZQU1;DU'>CJ(#C+S:7$JY^!%%`DFE
M=<\W1V\V]N\R6-["V.TZ208P`?>LM996XLH67'"1P'E5<\VIJMI]_)MLL0<:
MLJ[M'BNPD*(C%NYE*>;TN"2XA3GCY:\"8G<$W;OO&=HX=Y_B_6Z1U&IXT"[)
M;8>',;9=D;@4D=$3I[_[KI?'JEI":UY6TD<?.H%=?2[#/?<M:9?`'\EP:1@!
M(\"JF20-;(\]#*M5$G6B>U.."BC1$:(C1$:(C1%*R0L%M:?NIYO4I6O*0?"G
MF%4U),_T[=[N8%559TF-[3Q(T\UIGU/[CS+%;K9B%L?Y)E\<<-R6RJC\:"D$
MM4-?=]5?`U'$:^>GW5=R[AV..`Q[R+UQI0<5UKM'MR%\QOK]H+6UI7AJL56"
MUM;7[*77+9:W'\@S)LPHB5(;0ZR)BE-NM1^1*5H;+?$BOTZXMM3%?P/;PYK+
MBE_/5K"[C4CVK8LI.,EN%V/@/_R0`N(]H^4>_59^Z:<6M]DV^AWJ,GGE9,XJ
MX3'7ZJD%GF4Q&96KA5+90JE>/'7L+[8=J16V)DW-D&CU9#\)/AR7,-S7+V7+
MH=:-_O\`\+:%I@!*`DE*4H2E-/(#CYCSUZH;#U3&7_U=P6EBKG>HY3/+PI7R
MI7A7^CSU7]+R4Z=2RA/$"I]I\?ZAJ!B%.2:)O+J@YG3PX)0*`XGE:*:J/`GR
MK_1PU;W+W"!S6_-12N`#=>"MBYO1;9#DSI;H0F$A<IYQ^I0VAE!=*_=Y?NI3
MX:T_?NY[79F!;>SN#9'1\?P64ALY+YT,$?RU%%S+MBYFZ>^$2Z0FU.P+CDPG
M)="@%,VNUJ'[Z0@\4A;B/=\J:^6^(@N-]=[F9BTJZ,7(<2/#JJO3=VV';FQA
M'+HXPT'XA=5&D'D%/)(2*^8!X?1KZZX^W^G8P4UZ1_8+RO(:U/M_RJ@=9DBH
M5L>*>T4Z-$1HB-$1HB83JDZ0MJHT4C,<4VV7!^$*'GX<I5Q_Z=83-W\EKC9;
MD`=+&&ON48F=<[!7G1<J\S:D;D;Z2(C;[L@.Y%$AH2V>=#-LA.-E]+8/"A"3
M6O#7R/WB7[V[M^F7$L$WRC4<5Z9L8FX+9K;R#_<&:K+O5=S6ZU839(+'+#9;
MN<AEA`*4-KBM(:#GN\"I"%%0!X5UTSOW;OQ>S\5C;9OIQMN!6GA2FJU3M\8;
M^_N[V\>?4+/?5;)[-.Q7MML1,)-(YM#!24@>\IH`+*_80XH^&O9_8F[Q^<[;
M6]E`[HDB:*]/$T'-<TW\]UKDYC#\3>L>XA9E9=)+8`!!151)\".``^L:[?:N
MB-K2NK/A]JUR']RU$A^937JI'`D`ZCZS/!WN4.AZ:5\":CZ_+4#(YPI&#U\J
MITNK1.%Q*157^[VZHNE`TF!#O8I7.#/F4J^\D-@+6A"E))/$@)%*U*OPTU9W
M+F06[KR9S6VD8JXDTH%.(W7#>F.M2M#>H?><O(N6#8S-?#Q6$W2:RA#JUM?=
M=BP3Q0\IQ/NFNOFY]T7?!^Z+N/9NVV-<&NZ>IIU/+DN^;$V5;_1MRN2?T2L:
M"UM.0UUKS/L5X=-&T;F-11F-[8*+S>(@:89)H(]M40XTI2/^[?<X%0'GK>_M
M<[27N'+=R9T/$T@J`1IJL5W&W>[+1##0M:R"$TJ.)IR_5;D-J(2$\HI]O$GQ
MU[\],?@N+DU*F::J#044I%4W111HB-$1HB-$3IU;2\U$*G3_`/`<XT"4+6>%
M>8\BQR_1PUK.['-;M:]J?B](T]RK6X_?;XU"YJ[%0?6WIE2)',)+;EW>6VM(
MJE:IKH`J:'_#`XZ^5O:2T=-WHD_D!IZQ(KYE>B<Y*8^WNG$@!;`=3^*W&ZXI
M`OEN:#SN.2I,V0RE%5NVV9'7'DM`CBE+!5ZE0#7EUZ:^Y'9USE,$9[)A+(&=
M>G+1<^[;W<#+M\%PZGJ--/,?U^2MGIGW&MZ[8<(G26V9-O"%VT^JG_4P734>
MD%\H]7G50H!/AKFOVD]SXL)>387.2]#0\@!QI[%FNX&UGOB%];CJ81\5/R.G
MAJMQP_4%+5"4^/)0J2@<??3X@J^BNOHK'D+*^9]7AY&R/=R!_-<,C?>0O^G<
MWX?)14*K[Q))IX<0:^/A3Z-9.)V2Z:OC:!YJY]6X`X:>2AK?*4J4I*TH%`?=
M44T)`%32HJ=6-Y?W<32UX;&/&O!!-<#7IU\O-4.]9/9,?8<DWBZ0H#3;:G`)
M,EMHN!"2I0`6H&M/9QKK0=S=XMF[5LW-R4[#=-;PJ#4J\LL%D<M,'"-Q!/(+
M2'<[J/G9*W*Q["H\J!#DJ<97=GN$B='%4.MV]I%5<SGX5`UU\]^ZWW%;MW)/
M+A=HB3Z&>K*MKP*[EMC85O9-;>9`MZV4-.0_53.R.PL^;+M69Y:%-P07)$*Q
M3^9V8X^5<Z)3KKGOK2M7'E(X#5_V/^W_`"N:OXMU[E#G/:X.H[B>:M-V;QM[
M`/QV/=1U*5'`?^5OK`C)9;#:4!NB0@4^ZA`^ZA*:```:^F&+%LRSCQMM&&-B
M`&@IP7%KJYDGD]1]:$U\_:554I"13A]=*:SRMD]HB-$1HB-$1HB-$3"-4W1]
M7-1JJ?,05H4/$"M4^U/%)X_0%5U@\[B1D,;+#UT^`Z>.BJ1/Z90?:N=2C)V[
MZF5KD,*8L]VF+#+GW$.HN#8],)!%*M.U^O7S.?CIMK=WA-<M,-J9]'\B*\5W
M2/(C-[/_`(X`"4,X\B0M_9,2'=83C,ML.Q)<9Z*ZA=%)#;J"A?J(\.5:%&A\
MCKZ*SXO%[AVQ(R1[)(9K?I#N52%Q+ZB;%W#8XW$$/ZJ_X7-/=39C(-O[PY=,
M>AR9-@CK>EP+A;5N?%VIU3GJ,IHV>=Q3`J!^'7R;[H]D=\[/SL^7VY(]UNZ0
MN'2".)JO0FU]TV.6LFV-[3K(H22JGBW4CGMJB1X\AFVWKD:"`_<7'(US4EL`
M$/I0*J-!Q--1V?\`<MO+MW:_096"4SMTZW5/#DLY=]L]N9*/ZB"Z9'(>0&BO
M/^:_(5<$8?`#J1Q<^->]/PX^\I"0!]NNB,^^'<TC!'#`XGR*PDG:C&1C_OU_
M`*W+GU0[D75#D*TV2#&<D4::7;`_<9;:E&@*$?X?-[:^`UJV:^Z3N+N:%]AC
MHI?J)-``"K9G;S"V3Q-+.V1K3J#S5K0-K=W]R[FT]D;,WT7'0ZBY7-Y0;8;7
M4DB$33W0:4-1K%[>[=[_`.YEVV?-/EB:3K4%95VX=L[>AZ(XV/>/`CCY+;K;
MOIXQ_#)4>YRY;E_O+3(0VF8EE<&"#XF-'Y/=4">!K77MCMK]N&,V_)!>7\C9
MWL()!;Q]BY9N'N%/D'N@MFF&W=I0$]7OY+85JVJ04<BUI"/N%00?3'FE%``E
M%!X:]466&ML<>BS`9!X#P\%RR[CGNKKUW//36M%56VEH"@M854\"$TI]8J=9
M?TX6FL30TJ[D(>T-`I0*/J*E1HB-$1HB-$1HB-$1HBE7TD4((\5%22/O(H>8
M#5M<P^HSU*GX>7BJ<G4!UMX#BM<-[]JI6?6Z!=+&ZU'RJPO?&VU]=4-OK8/J
M-QW"GWB3RT'L.O-7>OMTW=^)^OPS.G)1ZDCCHMTVUG&V\;H93^V?R/M4QM!N
M;$S&W&PWES\OS;'5*A7RVR$EI]QUL\GQ$1!Y0^TJ@X\1QU4[1;F.(P#-N[C)
M%U$=.HZGD.*QF<Q[;J<OBT;6NG)9M5'C2PMJ4TV\@`H67$(7S)/`-N)2/3`(
M/A2NNV3XFRW':EOI,="X<P"K&W-U94,3G>SD?-8ZNVRVVUU?7)G8E!6\]1:G
M6V_3236M0$*24DU^W7(<Y]N>PLW*?JX&&<FM!3]%FHMX9BT'^UW2--=52$=/
MFU23S?IEFGCZ?J/)0?H/[PFFL=;?;3VYL"'.LP:>7Z*:3?N6?H)#Y_T5>%AV
MZPO'5)3:,<ML$I)*5L,U<K[2MP%5=;18=HNW.+F;/;V+&W#>!H#_`(6.GW7E
M;H&,R//5RX!7VVPENG*RA(I0D<"$_P!T<!KI.+Q&W[$4MH6M/D%C'3W,OS$J
M*$T6DBJ2"/`)`4/832M-;"#&'#T11E5:_2DN]1SM5/)YB`20?LI_7J[4Z>T1
M&B(T1&B(T1&B(T1&B(T10UIK0\*`&OV\-2GK)`T]/FHU'26GFJ<M@'G1P(5Y
M$?=)\Q_>&J++6!DQ=TCTR-0J-F);:3J)^%8RRW:W',H=3-?87;[ZR@IBWVU*
M,"XH((*5/NL<OK<JO[5:ZY3NSM[#D,D<E9],;.-!IJLTS(]!)H2/ZX)^UVG.
M,=M[<=-XAY4\RI*&'[NVY"<;8\/WWPR7/B'$T'OJXZKX5^XL2X6K)&.@&BH2
MW3'UH*$^"R9!0\Y&9<F(91,<;29+;+BULI<%*AGG`/)7VC72K=A<P70_[)'$
M\/:K)U':.X*>#=!X#Z2=7C2]W^T!2AD8X`43GI*Y@?=^W_EH^*![>ES1[E4`
MB&H'Q*)R?0/]^K<6=N-0"I2YR9R'V#]G'5=L;&C3BJ=9J\=%$2*`#4RG3=$1
MHB-$1HB-$1HB82!Q)IHB;HB-$3BR`DU_VXC1%"2D5YN"@:?=XD</^6B)U304
MNM*"GXO;]H.J<D;9!1R)U4=*DE/-RU\P1_P\-8S^.9ZG6!K5%&;;".4`\W(D
MCF-*FM/9K+M'1&&#@HZ44;103":<:$_53^BNB(!KY*'UC1$W1$:(F5'A45T1
M-T1,)H">/#V:(F<Z?;3Z]$3VB(T14)%V;E*=;BKC27HZUH?C-2&G9<922`H2
M(S2UNM<H4.!'-[PX<1HBB1KHT\L$NM!I+845(/,CWE<J0M0KRKK^$\1YTT15
M-3Z$5YN:E#RT37F*05$)I6I*>(]M-$4JJ4274MH6\>5"DI2E2@`N@%3RA(-#
M4BM10Z(I)B[LJYR%,J;2I20ZRZAYE90:+Y76E+;/*KW2*\P5P(&B*=3-4XHH
M;:*EI*.=)2K]WSI*DA=`>0T]M![-0->2*V)&X6'PI2X$[+<0@W!M9;<@2\GL
MK$U#@-.1<9<X.)43PH0#74>7M15X79!CM2DEM<9\-EJ0TM+[#OJJY4!MYE2V
M5\WM"BGZ=4VB2OQ?*BJ0>;!`4M/."$J',GW%*\`H5'*2/;XC51%*/3BA:6VT
M>HXX"M#235\M)6EM;WI5Y@RA2TU5Y<P]NB*,Q,0X>4_>J4D)'!*TJ*%H5QJ'
M$GB1[/#1%-D@"OEHBITF>AE:&TDJ<<7Z;+:4%9?7R*</)RA1Y`E!JKP%..B)
MK,X.K+9;!<22"&EH=`Y5%"Z*22#Z:Q17F".(T15"O"OCPKP\3]7TG1%2%7-)
M"D`4<6AY32*@*6ABB7UH*J(Y&5*`45$45PT11(MQ3)*TELI+7IA:E#E2"Z*I
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MX^<;Z=/TMR39L?M.19S?LJV)WKPR*DNW/'[--NQN=SP?);>7`XPTXVU+20%A
M!;/$B]#GH1ZM<'ZZNF':GJ;VT?AIQK='&XEWE62+>(-XN."Y&V@IO&$7^='0
MIQ=\L4T^F?50A26N4D<1HB2\_-T=3>_W2GD';TW%Z?MW\]VGS2-?MV77;EAV
M2S;-;[PW;&L/E1XF1P&7$PK]$2LE)9DMJ;4'5>W@1=H^R;W8\;[J_3/+W#?L
M<#!-\=JKI$PK>C`8]_B7)2[A'@L/0<WLL-2&)[>-Y65J<"EH_=24J:2I5.)%
MVODSFFH#CWJ$*](<H"/567E<$L-M*H%R%N$("/'F--$2''YG#OMYCLM?)W;]
MZ-\TO.#;G6^#;+WU$;OXE<TQ[]A,:XLHF1]H\8FPZ_`WB:EUI^[2FW4+CI*&
MD*"E*T1=T/ER\LR[<#M"]*^6YOD-YRK*;S&S>7=\CR*\7&^7VYO_`*TNR/CI
MUWNK\N;(DJ:;HH*40:T\M$7=%7%LT/+[OC6G+P^]Q_L^.B)%5\VAW.-V.F7`
M-G.C_IXW,_0>>[U1+QF>\>0XG?'+7G=FP7'GX\?&L>CJAN"38H.:3Y#SSCB"
MAUY$6GW55T1=A_E_.O"T]=_;AV8O]XS1[+][-H+$UM+ODW=YC;^4HRO&B&[?
M?KJRV0HQ\DLR6GV'U<':'C6NB+N<V>9/,/!7$5%#0^T>1T1/Z(K<O5N;FQ9T
M:3&;EV^9#EQ9T)QE+S<F++C/1Y33C:J(=9?8<4A:%U!"N`!T1>8KW=>V]OUV
M2.MK#.O3HD3F5CZ=)>;V?*]N]Q#?VIT?;+<N^SYT_*MF<S0RB.XG#,FJ_%A>
MNVI$B,ZILK4X@5(IWO`?,`;A]VC:_8[HFZ8MH[UC,#=&/MJ_NY98Z;DO,LOW
MM5-6R=KK#'@RTIF;<0;F4O)6ZVI3_,DJY4MFI$L.[&O:#Q3M>=,D.!=;9:LB
MZH-W(5OR/?O/DL17%-N/,(D6S:NR74(]>'BV*AX%U+)*)<P+62:BA%A7YICJ
M5O\`TW]JG<"PXE*DVN_=1>8XULU.N[:W"_$QNXE5QR0M+;6A454JW6[T?=/W
M5J'GHBTT^3=Z3X>W?15NYU7R92UY!U$[CO8E;H2@GX:V89M;6%%]/D2E_P!>
MY7.XNJ62JE&TU%=$2QGTCR`-MJ2GFJ6ET2$A"30)4">4+4!4FOU:(N#GS'W3
MO"WY[1?5$',:MU_RC:NSVS>/%9LYMIJ?9)^(W".JY3[6^>,>>;(MU#B6RE#R
M"*@G1%Q8^2:W53==B^M3:*;D,^5,L.Z&!9[9L;=*S:[3:;]8)UMN\^V()*67
M;E=(30D)%*J0@@>>B+&/SN[A;LG;_4FG,F[[UJ`(2JH^$PL>"@4\?I\-$7.^
MU;?[E_+R;[=`_<7V1QO)\[Z4NJSIYV\A[VLY%)ER,9MU]SJ-!F9_A[DNRN,>
MI>;=`!NUD<F,+0A54(*E5`(EF_<=[NNQG1UVWU=<FV^2V3<V/NUBL&)TP1X%
MTC/Q\\RW*X;[ELG>FE3DDQ,+452KJL)#C"HW(NBN&B+SM-[^W7N*.T_E'=]Z
MG,IRRY[U=3?4WC]MV[M5S<?:DW#%LF.33<OW#RM4E*7Y2\HN5M"+6T/<:BMA
M8]U:=$7H-?+-D'LQ](RAQ";7G`4?81FEZX4\?+1%W)R7+,?Q&RWO)<DN\2RX
M_C5IN%_R"ZSEEJ':[-:8BYUPG2UD$-L,16E+/F0.`.B+RRK)M5>OF&._ENG,
ML3N1W[IUO.?7*XY;F#3CB/T9TX;>,)L%D5`>D(0S`3E,V*R;<VDAUQ<PDIX*
MT1;L=B?J+N':7[R'4WVQ-VIL>=MMO#NS<-L+5DJXLAV5!W$Q>3)5M7<V76&2
MZ_$R>Q2$PWTJ`;0OE6//1%Z/C*VTH2VDC]W1LI34A!"BCE\Z!)331%'J/:/V
MC1%*R7$H0M?,KW6U*"$J'[P)!*P$?CY4\33RT1(]/FLNYAT_[2])^7]OV!^1
M9UU"[Z0\4R*=C\^PHO%LV?P)NYHF_K2[2`X%67-+BED"S(Y2^`I3Q`33F(D8
M_;CW]S?M'=>73KU-]0G3K(E8Z]BD#)OTOGF/N1;^O:7<=/P!W<VX?FM\C^1V
MF"I<J$JA<*444$A=01>O3M!O!@6\FVN![K[7W^%F.VNXV-6K*,)RNV.-+@WB
MRW>&F3&='I&D>2V"6Y#2N5;3Z5)4`131$EM^<BQJX7WMH[7Y+;V'WK=BW49C
M*[LZT%EB.B]VBYV^(Y)4FJ$I7)`2DJH*GAHBVJ^5(S6QY5V==H;7:E1DSL)W
M%W1Q6_1F%-E]JZ1[\FX>I+;02M#DF-/0I)4`5)%14:(E)14GB.85HKS_`+/C
M^RNB+EOWI,ZQK`.U;US9'DLQMBV?P&S"QHK12G[I>F6[5!A-I50*><E2DBGU
MZ(DG'R1F%WH7_KEW#]%TXZBS[8829!YDH_/'7[A>PP$*HDNB&V3[>71%<WSO
ME18^@,__`&>]8/\`[;#`1]H.B)0U;^A_;/N(]E3IWZ9-X8<J18LMZ8=I+MC5
MS@3?RNXXON/8L.CR<'R:)(2E9#5JNKJ$OH(Y'8ZUI5P.B)#9T6]EON*=277!
MMGV^>K6Q[KXATV=*^99/EF23LBBSU;6V7$E7=F?=$;:33_\`$3'MU%1&T1_0
M44AIU1(1[VB)3G\W9B=APOL^[<8GB=LAX_BN)]0^T./X]8+=&:B0[39K9BN5
MV^VVF.PP`TAF%&C`"GCRC1%T"^65_P#QBZ2J<?\`0YQ^W];7OAHBL?YDGN$6
M/H4[>>>XM9G&7=YNJ:W7393;.TO,KE(9M]XC!G.LHN"J@-IQ_'Y3HC5K60X@
M#1$E_P#EKNXQVS.V%LMO9EG4QO-<K)OYOME-FB#&[!A%[OIQ/;C$65M6IB3?
M8[8:1/OMUFORW8W,/1;;9\:\"+4KY@+KGZ(^I+K&V!ZY>VOGEU5O;8(\&?NA
MD:+1<L8FN99MS<8;^!Y*++.:92_,:AM>B\^FIF(X*J`22+T8^V]U;VWK?Z'^
MG'J>9FVQR\[H;=6R9FS%E>:<B6[.[<P+9E-NF,M*4+=-;NL5QPQR`IM+@%*4
M.B+>SXAG_P`1O_,;_P"WHBYK]SSN)[<]M'IBS3J+W'C,Y->H18LFV>WELO-M
M@9+GV6W%],)N':XD]U*GH%C]?XF:\VE0::2:@\-$2#7LK]M_=OO7==>=]?/6
M2K*,JZ=,6W/DYOGV1Y:])<3O%G\6X&5BNT6/N(1\'-P_%@&A=5QB&6XS:&``
M5D:(EG7>H[3^)=S?I#E[8XZSBF$;T;<*9RC8O-UXQ#?E07\:@R2_MHTY$:C3
M8N*9)!:^';;2M3;"N17)PT1)1OER.[/FW0UOM-[6?7$]DF";;7_,WL?VN&>L
M2(%QV3W;FW`MN8-=?CVVI3&#9Y*>2MAQU*&F92PM!Y'-$2W#N6='5CZZ>A?J
M'Z7[PRA^Z;@X%=I&$/I](N6W<>Q-+O>$2X"ED,1D"\Q&XZ5.&GI.J]NB+S[N
MP/W0+=V:>HG>SI0ZUL0S_"L2W2SG&,6S=Z>])MJ=AL\QN?,M,_(+_8)207[%
M=X[Z?4EQ`2IEM"ZE%3HB]&2Q]:_27DEEM5TM/5#T_3+5>HL:Y6RYPMU\0:CS
MX#RS(BO1FGKFE_U%1TI]5*Z$$TT1(LOF9^^#M?O;@5_[;71]?8FZ[N39%;?X
M_P"X^*MLWJS+_*9S<NR[8;<*BE]O);C<+BE#DV;&]443Z2#S5&B+MY\LOVZL
MNZ!.A(9)NC+6UNEU87['-Y,FQI]F9'=PBTMV)R!B>*W"-+2E;.1P[?(6N8H`
M)!=".!0=$7&/YWP%>/=`CB05(-VWJHH<1[T3#5)_ZD@D?5HB5]]MV,E[M]]&
M*7$.`HZ;=J`67$*0H\V(VP)"T+Y%"M*\:>&B+=H0FTNEQ'-1?H"07!SH4(IJ
MW0+5ZJ5`GAQ*1[-$24CYQOD1VH<<2"#S=4FV%/I/Y!FY/AYT&B+='Y:52VNS
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MBW+Q*S6F:>>%-N`:3<$N(`0ZTT54)XZ(E[/*Y_Z*U?YB/^&B)%?W^H?;5'7/
MMK*[MV0]=J\&7MC*_E]L>U&&X&UT_1;0+JC]2<V4V'.WMQY^8KN5?B_B[/&Y
M8G)3F'+4B5*]!'\I7\K6R7\DOZ/'3!^D(?\`#(8!Z!Q\QN1/Q_YJ44E#*A,Y
M_P`R^*!E&3S>I0Z(MQY_P_KQ/4K7U%>ERCWO4],U^&*3ZGJ!O[].'IUT1(M>
M_P#-_+\N]1#[?6/-WLA=;1QJW"Z2^D*V1KIN2B28C8PAS+K?+NUHQ1W(FS\,
M8"'Y2'ET0%J2DD@B4U]NJ/F47HKZ?V<VNV_-\N",$M?PEQZG<>PO%M\9.)%A
MLXW_`!.LV`Y-F..0K\BV>F/W$^0^I%"YRKJ-$2=CYBEOL)N9SBJ.X#+W"B=3
M2L=O(@R>EBWV2X;M-V0H3^6JW&@N7.V8\^ZEZGP2;I(;6H>)"=$2&*^XSVEE
MY@VO$-Z^YC'V\+Q].-<^E[IPF9,F+6J1%G1.KZ#:U*".%3''MIY:(E5G87C_
M`"WT;J/VM:V9N^_EYZQDQ'AMW/ZS<=QS&K8]F(8=]9S$[3B^499MY'RM3/J?
M!(7-=="J^DHK\")?4U\#0?!?X='_`%1&Y_3"OB!\7Z18]TW#XCQI3W:TX:(D
ML'S*3';+=S[H$<[FETZDX6!LY'NR<0A[%6'$KI8;A+4WB`N"=S+E<<DM&46>
MSLI^&,=5JB3G'/W@<"$\QT1*@=L/TH=N]O?T#\,G!OT?B_Z($3D4T<1%B@_D
MA;*>1H(5:O1J$@@*\*Z(LBGP/C]E?ZN.B+AS\P`GH`7T!7Q/<<=W-8V)5N#C
MXLS^S;"9>?,[F&!=ABZ[%%<D0K?)DI3\20F8\U&/@ZH(J01/]DV-M(SVD-G(
MW1]>=Z;AM<<=W-&UMZWAQG;RS[PIF+NE]$)4W&,;RV^8`Y<&+H:P@_=TM.K"
M`\6T$E)%S=^7R8[5L??;J@9Z;KIU`7CK[1*O/\QMPZO+#B.-[R2)@S"X_K0X
M99\5R/*L<AV560U^.%MG/NACTZU3HB5ML\G)[WM\Q3^LZ(I6X>G_`*?E^_SC
MDY*<U>'+2OG7PT1(TNH&+VHY/??VV_E=O?4_9NZ&WNG%5N1_*WBV%9+L[,O0
LQMPYTSO-_$O,,4LUMLZL3"QD#EF^+E`DGD+H()$LGHU_:@?Y9_\`,T1?_]D_
`
end
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>GRAPHIC
<SEQUENCE>3
<FILENAME>g834930cov_pg001.jpg
<DESCRIPTION>GRAPHIC
<TEXT>
begin 644 g834930cov_pg001.jpg
M_]C_X``02D9)1@`!`@``9`!D``#_[``11'5C:WD``0`$````9```_^X`#D%D
M;V)E`&3``````?_;`(0``0$!`0$!`0$!`0$!`0$!`0$!`0$!`0$!`0$!`0$!
M`0$!`0$!`0$!`0$!`0("`@("`@("`@("`P,#`P,#`P,#`P$!`0$!`0$"`0$"
M`@(!`@(#`P,#`P,#`P,#`P,#`P,#`P,#`P,#`P,#`P,#`P,#`P,#`P,#`P,#
M`P,#`P,#`P,#_\``$0@`A0"1`P$1``(1`0,1`?_$`+4```$!"0$`````````
M```````*`0(#!`4&!P@)"P$!```'`0$```````````````$"`P0%!@<("1``
M`0,#`@0#!`<$!P4)`````0(#!!$%!@`'(1(("3%!$U$B%`IA<8$R0A46D2,7
M&+'!4F(SDR3PH='ADM)#4]-4E"5E.1$``0,#`@0#!@4$`@,!`````0`"`Q$$
M!2$&,4$2!U%Q$V&1(C(4"(&AT2,5\+'!,_$TX4(D%O_:``P#`0`"$0,1`#\`
M7\:(C1$:(C1$:(C1$Z33QU1DX_@HA2SJT\J@2`!QJ>-*>P?B5[!JV8^!E77-
M!&/'@H&,S?!K16M=\@MMHCAZ?<(T-O[P7)<0PH@>1C+(<<K_`'>/T:T[/]QL
M)A@8HWMZO/FKB'$O>:`56$[IU`V1,A;6/V2\9$6I"8SS\=KX:(I=>50C!^CJ
MU<WFH)33CKF]SW#N;_XK`ETI.G_"RL>'="/6<*"BN*#?]S,B:+]MQ^R8VPM:
M?1.1RGY;SB3QJTS#0&T&GDI0&LEB7Y_+3B2;JZ2H3!C&T/'V++]E;N#<5K\R
M?9D333X@QD^E%0K\7H!7O$:[)C&MMH!#*?W5BY9&N-`J_K)*W1HB-$1HB-$1
MHB-$1HB-$1HB-$3..J9#^14=%!?4M"4E*@D<WODTX)H3PKJHTL8"93RT46NC
M;_L_!4.XW=J"P]/F2$PK?%25OR)!0AI*`#[Y4JE!6FM<W'EH-O8]V:OI6MM&
M"I83J0HPV5Y=3M9"=#RYE:N9OOS<;A,=LVV@MUS3;D*D7_*[@Z&<:L+2:<CD
MF3PYW"#[J4FI.O)FZN_]OEVO9ACZ<+7]/3QJ?%=`Q>!M;=HDOVZD<*T5C8A@
MU\W!R5=\E3;C=+:EAQY_+;J5%MV0MHT_2-N=_P!.J"E?`.K25!/%)KK!X'9V
M>WY<MO2YYA)J>*JY":PLV_L``\`/ZX+:_$=OL<Q*,$VR*\X_)_?RKI*<,B;,
M?-*EQUPE81[$BB1KT[MS8.#VY:-=>0%]TT#4D\5J-YE;B4&.HZ>0Y*]O20%!
M2DI/$&I0"00/%*N!!UOUK=V,(Z;6#H6%,\SM*J:+E`DI\J4^C5665E?JI(R0
MW6BI?N]5.2?#SH'$5'F>'AYZA;Y/ZIX#(G!OB5.X/&NE%%;=YZ<?Z/#[-9.2
M-U`6FBD$HKTGBIC154:(C1$:(C1$:(C1$:(F'5-]:BBBH1>1[WO`E(J$^=!]
M[ZR-32O;"SJ?R4%:F2Y-:[!9YEVNDKTX,5M3RG.5`("?P(235U0]GLUS;=V]
M[#!XZ6^GD#?2:7-!TZB.0\5D<=BYLK<"W@%7<?*FJT$RC<+(-XI=W?3<OR#;
M"Q)5^<3@LA<J&W7G<*!P4LCW>0>VNOG'O+N[NWN1N)UJUSX\/&^G3P!`*[#B
ML1:8>UK,T>N:TKQ)I7CR"R!M=MA"SZ`S(7`%KVL24_E=A:"H[^6+9(].[7IY
M-'Y#*%I*DM+]TUUW?M;V9L=Q7C,K=?#9M8:@\W>*U7<&8B:##'3U*\?!;E0[
M5'M[#<2)%3"BQ([<6(AE*4M,1FP$AEIH`)2GE%->O<+A6;4B$%DP&("G!:)-
M=/E&IXFI\U.^JPPA*G%\B`.1!(H*?0/"IUFY<I"&&YNAH.16/`<7U=P5H9+G
M^*8TW6[7:.TIP'TXL=+LZ8ZH?A9C14NN*6H>5-:]D-YVULP_3Q5</9^BNHXN
MIW)8W_C2[*"WK3MMG]QA()#4P6I,>.^1X*1\0XAX`_2G6@93NGD;2)\D5L]S
M&C44X_DK]EII6H)`5M7'J4M5D<2G(,+S2S1UJ#:IDBWE;#2U4%'"@$<J?,^S
M6`=]PC+&R]2\M#&0.)%%D+?%ON1\-/<LRX)N%C><6L7.Q3VI$;F*%44/B&UI
M/%+C)-4ZWK8'=*PWIUEC@'`<*JPR.&?;N!`/^%D9+H6$J!X*\/V:Z;'<=96)
M*C:OP:BJ@C441HB-$1HB-$1HBAK4H%-*4XU_9PU+KU@<E*>KJ%/DYJW[I);A
ML.R7EAIIIIQR0X5\@;80GF<<2H\!RH%?IUJ6\L]9X*T=<WS@V`,KQHIA#<74
M[(K"C@2*_CX>U<Y]P\TN>]N<1L3L#SXQ]A4B/&D,+<:8])H$/WR53@&8]"@I
M5]ZNOF+W+[A;EWMO"WP]FYO_`.9CG#G%O$BNM3X47?L+A+#;6'9EF5.3D^%X
M/"G@!X^"JV.XS'S;,8FW5BCKCX-@[S?ZED1'4ICY#,8;0K_6J0DB2Q,<42@>
M%$G67V?MT[F[@P8FRC`P[:=1:-30ZDE8O,91QM72S'XW<!2E*\&@?W70.TVZ
M+!A1(L%EJ+$9CMM1X\=(0PRTW[H0VV``D<HU]&<1MNQP;&V=@7,B:T+C]Y(7
MSFI)-57#2J02JH20`#P/#B5>-2-;<R<L9T$`^:MN"MJZV=^[J:"YSL5IA=4I
MBK#3B^`X+)"P0H<#]&L9=64-T2Z2M?R4*E.P,1L4%]<V/:X+4Y?WI0:YGU'^
MV'5J4IM9]J::MH\-8$CJ8%6;*YHTHJK\+1KG"$UX\%%2@#4T4.<JH1[1K(18
M?$M-988RWVBJEGO)VPN+-7@:*@7FS6ZZQU1;DU'>CJ(#C+S:7$JY^!%%`DFE
M=<\W1V\V]N\R6-["V.TZ208P`?>LM996XLH67'"1P'E5<\VIJMI]_)MLL0<:
MLJ[M'BNPD*(C%NYE*>;TN"2XA3GCY:\"8G<$W;OO&=HX=Y_B_6Z1U&IXT"[)
M;8>',;9=D;@4D=$3I[_[KI?'JEI":UY6TD<?.H%=?2[#/?<M:9?`'\EP:1@!
M(\"JF20-;(\]#*M5$G6B>U.."BC1$:(C1$:(C1%*R0L%M:?NIYO4I6O*0?"G
MF%4U),_T[=[N8%559TF-[3Q(T\UIGU/[CS+%;K9B%L?Y)E\<<-R6RJC\:"D$
MM4-?=]5?`U'$:^>GW5=R[AV..`Q[R+UQI0<5UKM'MR%\QOK]H+6UI7AJL56"
MUM;7[*77+9:W'\@S)LPHB5(;0ZR)BE-NM1^1*5H;+?$BOTZXMM3%?P/;PYK+
MBE_/5K"[C4CVK8LI.,EN%V/@/_R0`N(]H^4>_59^Z:<6M]DV^AWJ,GGE9,XJ
MX3'7ZJD%GF4Q&96KA5+90JE>/'7L+[8=J16V)DW-D&CU9#\)/AR7,-S7+V7+
MH=:-_O\`\+:%I@!*`DE*4H2E-/(#CYCSUZH;#U3&7_U=P6EBKG>HY3/+PI7R
MI7A7^CSU7]+R4Z=2RA/$"I]I\?ZAJ!B%.2:)O+J@YG3PX)0*`XGE:*:J/`GR
MK_1PU;W+W"!S6_-12N`#=>"MBYO1;9#DSI;H0F$A<IYQ^I0VAE!=*_=Y?NI3
MX:T_?NY[79F!;>SN#9'1\?P64ALY+YT,$?RU%%S+MBYFZ>^$2Z0FU.P+CDPG
M)="@%,VNUJ'[Z0@\4A;B/=\J:^6^(@N-]=[F9BTJZ,7(<2/#JJO3=VV';FQA
M'+HXPT'XA=5&D'D%/)(2*^8!X?1KZZX^W^G8P4UZ1_8+RO(:U/M_RJ@=9DBH
M5L>*>T4Z-$1HB-$1HB83JDZ0MJHT4C,<4VV7!^$*'GX<I5Q_Z=83-W\EKC9;
MD`=+&&ON48F=<[!7G1<J\S:D;D;Z2(C;[L@.Y%$AH2V>=#-LA.-E]+8/"A"3
M6O#7R/WB7[V[M^F7$L$WRC4<5Z9L8FX+9K;R#_<&:K+O5=S6ZU839(+'+#9;
MN<AEA`*4-KBM(:#GN\"I"%%0!X5UTSOW;OQ>S\5C;9OIQMN!6GA2FJU3M\8;
M^_N[V\>?4+/?5;)[-.Q7MML1,)-(YM#!24@>\IH`+*_80XH^&O9_8F[Q^<[;
M6]E`[HDB:*]/$T'-<TW\]UKDYC#\3>L>XA9E9=)+8`!!151)\".``^L:[?:N
MB-K2NK/A]JUR']RU$A^937JI'`D`ZCZS/!WN4.AZ:5\":CZ_+4#(YPI&#U\J
MITNK1.%Q*157^[VZHNE`TF!#O8I7.#/F4J^\D-@+6A"E))/$@)%*U*OPTU9W
M+F06[KR9S6VD8JXDTH%.(W7#>F.M2M#>H?><O(N6#8S-?#Q6$W2:RA#JUM?=
M=BP3Q0\IQ/NFNOFY]T7?!^Z+N/9NVV-<&NZ>IIU/+DN^;$V5;_1MRN2?T2L:
M"UM.0UUKS/L5X=-&T;F-11F-[8*+S>(@:89)H(]M40XTI2/^[?<X%0'GK>_M
M<[27N'+=R9T/$T@J`1IJL5W&W>[+1##0M:R"$TJ.)IR_5;D-J(2$\HI]O$GQ
MU[\],?@N+DU*F::J#044I%4W111HB-$1HB-$3IU;2\U$*G3_`/`<XT"4+6>%
M>8\BQR_1PUK.['-;M:]J?B](T]RK6X_?;XU"YJ[%0?6WIE2)',)+;EW>6VM(
MJE:IKH`J:'_#`XZ^5O:2T=-WHD_D!IZQ(KYE>B<Y*8^WNG$@!;`=3^*W&ZXI
M`OEN:#SN.2I,V0RE%5NVV9'7'DM`CBE+!5ZE0#7EUZ:^Y'9USE,$9[)A+(&=
M>G+1<^[;W<#+M\%PZGJ--/,?U^2MGIGW&MZ[8<(G26V9-O"%VT^JG_4P734>
MD%\H]7G50H!/AKFOVD]SXL)>387.2]#0\@!QI[%FNX&UGOB%];CJ81\5/R.G
MAJMQP_4%+5"4^/)0J2@<??3X@J^BNOHK'D+*^9]7AY&R/=R!_-<,C?>0O^G<
MWX?)14*K[Q))IX<0:^/A3Z-9.)V2Z:OC:!YJY]6X`X:>2AK?*4J4I*TH%`?=
M44T)`%32HJ=6-Y?W<32UX;&/&O!!-<#7IU\O-4.]9/9,?8<DWBZ0H#3;:G`)
M,EMHN!"2I0`6H&M/9QKK0=S=XMF[5LW-R4[#=-;PJ#4J\LL%D<M,'"-Q!/(+
M2'<[J/G9*W*Q["H\J!#DJ<97=GN$B='%4.MV]I%5<SGX5`UU\]^ZWW%;MW)/
M+A=HB3Z&>K*MKP*[EMC85O9-;>9`MZV4-.0_53.R.PL^;+M69Y:%-P07)$*Q
M3^9V8X^5<Z)3KKGOK2M7'E(X#5_V/^W_`"N:OXMU[E#G/:X.H[B>:M-V;QM[
M`/QV/=1U*5'`?^5OK`C)9;#:4!NB0@4^ZA`^ZA*:```:^F&+%LRSCQMM&&-B
M`&@IP7%KJYDGD]1]:$U\_:554I"13A]=*:SRMD]HB-$1HB-$1HB-$3"-4W1]
M7-1JJ?,05H4/$"M4^U/%)X_0%5U@\[B1D,;+#UT^`Z>.BJ1/Z90?:N=2C)V[
MZF5KD,*8L]VF+#+GW$.HN#8],)!%*M.U^O7S.?CIMK=WA-<M,-J9]'\B*\5W
M2/(C-[/_`(X`"4,X\B0M_9,2'=83C,ML.Q)<9Z*ZA=%)#;J"A?J(\.5:%&A\
MCKZ*SXO%[AVQ(R1[)(9K?I#N52%Q+ZB;%W#8XW$$/ZJ_X7-/=39C(-O[PY=,
M>AR9-@CK>EP+A;5N?%VIU3GJ,IHV>=Q3`J!^'7R;[H]D=\[/SL^7VY(]UNZ0
MN'2".)JO0FU]TV.6LFV-[3K(H22JGBW4CGMJB1X\AFVWKD:"`_<7'(US4EL`
M$/I0*J-!Q--1V?\`<MO+MW:_096"4SMTZW5/#DLY=]L]N9*/ZB"Z9'(>0&BO
M/^:_(5<$8?`#J1Q<^->]/PX^\I"0!]NNB,^^'<TC!'#`XGR*PDG:C&1C_OU_
M`*W+GU0[D75#D*TV2#&<D4::7;`_<9;:E&@*$?X?-[:^`UJV:^Z3N+N:%]AC
MHI?J)-``"K9G;S"V3Q-+.V1K3J#S5K0-K=W]R[FT]D;,WT7'0ZBY7-Y0;8;7
M4DB$33W0:4-1K%[>[=[_`.YEVV?-/EB:3K4%95VX=L[>AZ(XV/>/`CCY+;K;
MOIXQ_#)4>YRY;E_O+3(0VF8EE<&"#XF-'Y/=4">!K77MCMK]N&,V_)!>7\C9
MWL()!;Q]BY9N'N%/D'N@MFF&W=I0$]7OY+85JVJ04<BUI"/N%00?3'FE%``E
M%!X:]466&ML<>BS`9!X#P\%RR[CGNKKUW//36M%56VEH"@M854\"$TI]8J=9
M?TX6FL30TJ[D(>T-`I0*/J*E1HB-$1HB-$1HB-$1HBE7TD4((\5%22/O(H>8
M#5M<P^HSU*GX>7BJ<G4!UMX#BM<-[]JI6?6Z!=+&ZU'RJPO?&VU]=4-OK8/J
M-QW"GWB3RT'L.O-7>OMTW=^)^OPS.G)1ZDCCHMTVUG&V\;H93^V?R/M4QM!N
M;$S&W&PWES\OS;'5*A7RVR$EI]QUL\GQ$1!Y0^TJ@X\1QU4[1;F.(P#-N[C)
M%U$=.HZGD.*QF<Q[;J<OBT;6NG)9M5'C2PMJ4TV\@`H67$(7S)/`-N)2/3`(
M/A2NNV3XFRW':EOI,="X<P"K&W-U94,3G>SD?-8ZNVRVVUU?7)G8E!6\]1:G
M6V_3236M0$*24DU^W7(<Y]N>PLW*?JX&&<FM!3]%FHMX9BT'^UW2--=52$=/
MFU23S?IEFGCZ?J/)0?H/[PFFL=;?;3VYL"'.LP:>7Z*:3?N6?H)#Y_T5>%AV
MZPO'5)3:,<ML$I)*5L,U<K[2MP%5=;18=HNW.+F;/;V+&W#>!H#_`(6.GW7E
M;H&,R//5RX!7VVPENG*RA(I0D<"$_P!T<!KI.+Q&W[$4MH6M/D%C'3W,OS$J
M*$T6DBJ2"/`)`4/832M-;"#&'#T11E5:_2DN]1SM5/)YB`20?LI_7J[4Z>T1
M&B(T1&B(T1&B(T1&B(T10UIK0\*`&OV\-2GK)`T]/FHU'26GFJ<M@'G1P(5Y
M$?=)\Q_>&J++6!DQ=TCTR-0J-F);:3J)^%8RRW:W',H=3-?87;[ZR@IBWVU*
M,"XH((*5/NL<OK<JO[5:ZY3NSM[#D,D<E9],;.-!IJLTS(]!)H2/ZX)^UVG.
M,=M[<=-XAY4\RI*&'[NVY"<;8\/WWPR7/B'$T'OJXZKX5^XL2X6K)&.@&BH2
MW3'UH*$^"R9!0\Y&9<F(91,<;29+;+BULI<%*AGG`/)7VC72K=A<P70_[)'$
M\/:K)U':.X*>#=!X#Z2=7C2]W^T!2AD8X`43GI*Y@?=^W_EH^*![>ES1[E4`
MB&H'Q*)R?0/]^K<6=N-0"I2YR9R'V#]G'5=L;&C3BJ=9J\=%$2*`#4RG3=$1
MHB-$1HB-$1HB82!Q)IHB;HB-$3BR`DU_VXC1%"2D5YN"@:?=XD</^6B)U304
MNM*"GXO;]H.J<D;9!1R)U4=*DE/-RU\P1_P\-8S^.9ZG6!K5%&;;".4`\W(D
MCF-*FM/9K+M'1&&#@HZ44;103":<:$_53^BNB(!KY*'UC1$W1$:(F5'A45T1
M-T1,)H">/#V:(F<Z?;3Z]$3VB(T14)%V;E*=;BKC27HZUH?C-2&G9<922`H2
M(S2UNM<H4.!'-[PX<1HBB1KHT\L$NM!I+845(/,CWE<J0M0KRKK^$\1YTT15
M-3Z$5YN:E#RT37F*05$)I6I*>(]M-$4JJ4274MH6\>5"DI2E2@`N@%3RA(-#
M4BM10Z(I)B[LJYR%,J;2I20ZRZAYE90:+Y76E+;/*KW2*\P5P(&B*=3-4XHH
M;:*EI*.=)2K]WSI*DA=`>0T]M![-0->2*V)&X6'PI2X$[+<0@W!M9;<@2\GL
MK$U#@-.1<9<X.)43PH0#74>7M15X79!CM2DEM<9\-EJ0TM+[#OJJY4!MYE2V
M5\WM"BGZ=4VB2OQ?*BJ0>;!`4M/."$J',GW%*\`H5'*2/;XC51%*/3BA:6VT
M>HXX"M#235\M)6EM;WI5Y@RA2TU5Y<P]NB*,Q,0X>4_>J4D)'!*TJ*%H5QJ'
M$GB1[/#1%-D@"OEHBITF>AE:&TDJ<<7Z;+:4%9?7R*</)RA1Y`E!JKP%..B)
MK,X.K+9;!<22"&EH=`Y5%"Z*22#Z:Q17F".(T15"O"OCPKP\3]7TG1%2%7-)
M"D`4<6AY32*@*6ABB7UH*J(Y&5*`45$45PT11(MQ3)*TELI+7IA:E#E2"Z*I
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MX^<;Z=/TMR39L?M.19S?LJV)WKPR*DNW/'[--NQN=SP?);>7`XPTXVU+20%A
M!;/$B]#GH1ZM<'ZZNF':GJ;VT?AIQK='&XEWE62+>(-XN."Y&V@IO&$7^='0
MIQ=\L4T^F?50A26N4D<1HB2\_-T=3>_W2GD';TW%Z?MW\]VGS2-?MV77;EAV
M2S;-;[PW;&L/E1XF1P&7$PK]$2LE)9DMJ;4'5>W@1=H^R;W8\;[J_3/+W#?L
M<#!-\=JKI$PK>C`8]_B7)2[A'@L/0<WLL-2&)[>-Y65J<"EH_=24J:2I5.)%
MVODSFFH#CWJ$*](<H"/567E<$L-M*H%R%N$("/'F--$2''YG#OMYCLM?)W;]
MZ-\TO.#;G6^#;+WU$;OXE<TQ[]A,:XLHF1]H\8FPZ_`WB:EUI^[2FW4+CI*&
MD*"E*T1=T/ER\LR[<#M"]*^6YOD-YRK*;S&S>7=\CR*\7&^7VYO_`*TNR/CI
MUWNK\N;(DJ:;HH*40:T\M$7=%7%LT/+[OC6G+P^]Q_L^.B)%5\VAW.-V.F7`
M-G.C_IXW,_0>>[U1+QF>\>0XG?'+7G=FP7'GX\?&L>CJAN"38H.:3Y#SSCB"
MAUY$6GW55T1=A_E_.O"T]=_;AV8O]XS1[+][-H+$UM+ODW=YC;^4HRO&B&[?
M?KJRV0HQ\DLR6GV'U<':'C6NB+N<V>9/,/!7$5%#0^T>1T1/Z(K<O5N;FQ9T
M:3&;EV^9#EQ9T)QE+S<F++C/1Y33C:J(=9?8<4A:%U!"N`!T1>8KW=>V]OUV
M2.MK#.O3HD3F5CZ=)>;V?*]N]Q#?VIT?;+<N^SYT_*MF<S0RB.XG#,FJ_%A>
MNVI$B,ZILK4X@5(IWO`?,`;A]VC:_8[HFZ8MH[UC,#=&/MJ_NY98Z;DO,LOW
MM5-6R=KK#'@RTIF;<0;F4O)6ZVI3_,DJY4MFI$L.[&O:#Q3M>=,D.!=;9:LB
MZH-W(5OR/?O/DL17%-N/,(D6S:NR74(]>'BV*AX%U+)*)<P+62:BA%A7YICJ
M5O\`TW]JG<"PXE*DVN_=1>8XULU.N[:W"_$QNXE5QR0M+;6A454JW6[T?=/W
M5J'GHBTT^3=Z3X>W?15NYU7R92UY!U$[CO8E;H2@GX:V89M;6%%]/D2E_P!>
MY7.XNJ62JE&TU%=$2QGTCR`-MJ2GFJ6ET2$A"30)4">4+4!4FOU:(N#GS'W3
MO"WY[1?5$',:MU_RC:NSVS>/%9LYMIJ?9)^(W".JY3[6^>,>>;(MU#B6RE#R
M"*@G1%Q8^2:W53==B^M3:*;D,^5,L.Z&!9[9L;=*S:[3:;]8)UMN\^V()*67
M;E=(30D)%*J0@@>>B+&/SN[A;LG;_4FG,F[[UJ`(2JH^$PL>"@4\?I\-$7.^
MU;?[E_+R;[=`_<7V1QO)\[Z4NJSIYV\A[VLY%)ER,9MU]SJ-!F9_A[DNRN,>
MI>;=`!NUD<F,+0A54(*E5`(EF_<=[NNQG1UVWU=<FV^2V3<V/NUBL&)TP1X%
MTC/Q\\RW*X;[ELG>FE3DDQ,+452KJL)#C"HW(NBN&B+SM-[^W7N*.T_E'=]Z
MG,IRRY[U=3?4WC]MV[M5S<?:DW#%LF.33<OW#RM4E*7Y2\HN5M"+6T/<:BMA
M8]U:=$7H-?+-D'LQ](RAQ";7G`4?81FEZX4\?+1%W)R7+,?Q&RWO)<DN\2RX
M_C5IN%_R"ZSEEJ':[-:8BYUPG2UD$-L,16E+/F0.`.B+RRK)M5>OF&._ENG,
ML3N1W[IUO.?7*XY;F#3CB/T9TX;>,)L%D5`>D(0S`3E,V*R;<VDAUQ<PDIX*
MT1;L=B?J+N':7[R'4WVQ-VIL>=MMO#NS<-L+5DJXLAV5!W$Q>3)5M7<V76&2
MZ_$R>Q2$PWTJ`;0OE6//1%Z/C*VTH2VDC]W1LI34A!"BCE\Z!)331%'J/:/V
MC1%*R7$H0M?,KW6U*"$J'[P)!*P$?CY4\33RT1(]/FLNYAT_[2])^7]OV!^1
M9UU"[Z0\4R*=C\^PHO%LV?P)NYHF_K2[2`X%67-+BED"S(Y2^`I3Q`33F(D8
M_;CW]S?M'=>73KU-]0G3K(E8Z]BD#)OTOGF/N1;^O:7<=/P!W<VX?FM\C^1V
MF"I<J$JA<*444$A=01>O3M!O!@6\FVN![K[7W^%F.VNXV-6K*,)RNV.-+@WB
MRW>&F3&='I&D>2V"6Y#2N5;3Z5)4`131$EM^<BQJX7WMH[7Y+;V'WK=BW49C
M*[LZT%EB.B]VBYV^(Y)4FJ$I7)`2DJH*GAHBVJ^5(S6QY5V==H;7:E1DSL)W
M%W1Q6_1F%-E]JZ1[\FX>I+;02M#DF-/0I)4`5)%14:(E)14GB.85HKS_`+/C
M^RNB+EOWI,ZQK`.U;US9'DLQMBV?P&S"QHK12G[I>F6[5!A-I50*><E2DBGU
MZ(DG'R1F%WH7_KEW#]%TXZBS[8829!YDH_/'7[A>PP$*HDNB&V3[>71%<WSO
ME18^@,__`&>]8/\`[;#`1]H.B)0U;^A_;/N(]E3IWZ9-X8<J18LMZ8=I+MC5
MS@3?RNXXON/8L.CR<'R:)(2E9#5JNKJ$OH(Y'8ZUI5P.B)#9T6]EON*=277!
MMGV^>K6Q[KXATV=*^99/EF23LBBSU;6V7$E7=F?=$;:33_\`$3'MU%1&T1_0
M44AIU1(1[VB)3G\W9B=APOL^[<8GB=LAX_BN)]0^T./X]8+=&:B0[39K9BN5
MV^VVF.PP`TAF%&C`"GCRC1%T"^65_P#QBZ2J<?\`0YQ^W];7OAHBL?YDGN$6
M/H4[>>>XM9G&7=YNJ:W7393;.TO,KE(9M]XC!G.LHN"J@-IQ_'Y3HC5K60X@
M#1$E_P#EKNXQVS.V%LMO9EG4QO-<K)OYOME-FB#&[!A%[OIQ/;C$65M6IB3?
M8[8:1/OMUFORW8W,/1;;9\:\"+4KY@+KGZ(^I+K&V!ZY>VOGEU5O;8(\&?NA
MD:+1<L8FN99MS<8;^!Y*++.:92_,:AM>B\^FIF(X*J`22+T8^V]U;VWK?Z'^
MG'J>9FVQR\[H;=6R9FS%E>:<B6[.[<P+9E-NF,M*4+=-;NL5QPQR`IM+@%*4
M.B+>SXAG_P`1O_,;_P"WHBYK]SSN)[<]M'IBS3J+W'C,Y->H18LFV>WELO-M
M@9+GV6W%],)N':XD]U*GH%C]?XF:\VE0::2:@\-$2#7LK]M_=OO7==>=]?/6
M2K*,JZ=,6W/DYOGV1Y:])<3O%G\6X&5BNT6/N(1\'-P_%@&A=5QB&6XS:&``
M5D:(EG7>H[3^)=S?I#E[8XZSBF$;T;<*9RC8O-UXQ#?E07\:@R2_MHTY$:C3
M8N*9)!:^';;2M3;"N17)PT1)1OER.[/FW0UOM-[6?7$]DF";;7_,WL?VN&>L
M2(%QV3W;FW`MN8-=?CVVI3&#9Y*>2MAQU*&F92PM!Y'-$2W#N6='5CZZ>A?J
M'Z7[PRA^Z;@X%=I&$/I](N6W<>Q-+O>$2X"ED,1D"\Q&XZ5.&GI.J]NB+S[N
MP/W0+=V:>HG>SI0ZUL0S_"L2W2SG&,6S=Z>])MJ=AL\QN?,M,_(+_8)207[%
M=X[Z?4EQ`2IEM"ZE%3HB]&2Q]:_27DEEM5TM/5#T_3+5>HL:Y6RYPMU\0:CS
MX#RS(BO1FGKFE_U%1TI]5*Z$$TT1(LOF9^^#M?O;@5_[;71]?8FZ[N39%;?X
M_P"X^*MLWJS+_*9S<NR[8;<*BE]O);C<+BE#DV;&]443Z2#S5&B+MY\LOVZL
MNZ!.A(9)NC+6UNEU87['-Y,FQI]F9'=PBTMV)R!B>*W"-+2E;.1P[?(6N8H`
M)!=".!0=$7&/YWP%>/=`CB05(-VWJHH<1[T3#5)_ZD@D?5HB5]]MV,E[M]]&
M*7$.`HZ;=J`67$*0H\V(VP)"T+Y%"M*\:>&B+=H0FTNEQ'-1?H"07!SH4(IJ
MW0+5ZJ5`GAQ*1[-$24CYQOD1VH<<2"#S=4FV%/I/Y!FY/AYT&B+='Y:52VNS
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MBW+Q*S6F:>>%-N`:3<$N(`0ZTT54)XZ(E[/*Y_Z*U?YB/^&B)%?W^H?;5'7/
MMK*[MV0]=J\&7MC*_E]L>U&&X&UT_1;0+JC]2<V4V'.WMQY^8KN5?B_B[/&Y
M8G)3F'+4B5*]!'\I7\K6R7\DOZ/'3!^D(?\`#(8!Z!Q\QN1/Q_YJ44E#*A,Y
M_P`R^*!E&3S>I0Z(MQY_P_KQ/4K7U%>ERCWO4],U^&*3ZGJ!O[].'IUT1(M>
M_P#-_+\N]1#[?6/-WLA=;1QJW"Z2^D*V1KIN2B28C8PAS+K?+NUHQ1W(FS\,
M8"'Y2'ET0%J2DD@B4U]NJ/F47HKZ?V<VNV_-\N",$M?PEQZG<>PO%M\9.)%A
MLXW_`!.LV`Y-F..0K\BV>F/W$^0^I%"YRKJ-$2=CYBEOL)N9SBJ.X#+W"B=3
M2L=O(@R>EBWV2X;M-V0H3^6JW&@N7.V8\^ZEZGP2;I(;6H>)"=$2&*^XSVEE
MY@VO$-Z^YC'V\+Q].-<^E[IPF9,F+6J1%G1.KZ#:U*".%3''MIY:(E5G87C_
M`"WT;J/VM:V9N^_EYZQDQ'AMW/ZS<=QS&K8]F(8=]9S$[3B^499MY'RM3/J?
M!(7-=="J^DHK\")?4U\#0?!?X='_`%1&Y_3"OB!\7Z18]TW#XCQI3W:TX:(D
ML'S*3';+=S[H$<[FETZDX6!LY'NR<0A[%6'$KI8;A+4WB`N"=S+E<<DM&46>
MSLI^&,=5JB3G'/W@<"$\QT1*@=L/TH=N]O?T#\,G!OT?B_Z($3D4T<1%B@_D
MA;*>1H(5:O1J$@@*\*Z(LBGP/C]E?ZN.B+AS\P`GH`7T!7Q/<<=W-8V)5N#C
MXLS^S;"9>?,[F&!=ABZ[%%<D0K?)DI3\20F8\U&/@ZH(J01/]DV-M(SVD-G(
MW1]>=Z;AM<<=W-&UMZWAQG;RS[PIF+NE]$)4W&,;RV^8`Y<&+H:P@_=TM.K"
M`\6T$E)%S=^7R8[5L??;J@9Z;KIU`7CK[1*O/\QMPZO+#B.-[R2)@S"X_K0X
M99\5R/*L<AV560U^.%MG/NACTZU3HB5ML\G)[WM\Q3^LZ(I6X>G_`*?E^_SC
MDY*<U>'+2OG7PT1(TNH&+VHY/??VV_E=O?4_9NZ&WNG%5N1_*WBV%9+L[,O0
LQMPYTSO-_$O,,4LUMLZL3"QD#EF^+E`DGD+H()$LGHU_:@?Y9_\`,T1?_]D_
`
end
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>GRAPHIC
<SEQUENCE>4
<FILENAME>g834930suppcov_logo.jpg
<DESCRIPTION>GRAPHIC
<TEXT>
begin 644 g834930suppcov_logo.jpg
M_]C_X``02D9)1@`!`@``9`!D``#_[``11'5C:WD``0`$````9```_^X`#D%D
M;V)E`&3``````?_;`(0``0$!`0$!`0$!`0$!`0$!`0$!`0$!`0$!`0$!`0$!
M`0$!`0$!`0$!`0$!`0("`@("`@("`@("`P,#`P,#`P,#`P$!`0$!`0$"`0$"
M`@(!`@(#`P,#`P,#`P,#`P,#`P,#`P,#`P,#`P,#`P,#`P,#`P,#`P,#`P,#
M`P,#`P,#`P,#_\``$0@`5@!>`P$1``(1`0,1`?_$`*,````&`P$!````````
M```````&!P@)"@$$!0(#`0$```<!`0```````````````0(#!08'"`0)$```
M!@$#`P,!!P($!P`````!`@,$!08'`!$((1(),1,405%A(B,5%@IQP9%"4B2!
MH3)B@B87$0`!`P,"!`0#!@8#```````!``(#$00%(08Q41('06%Q$R(R"/"!
MD:%B%+'!T4(C%>$S%O_:``P#`0`"$0,1`#\`O\:(AHB&B+`B`>H@&_IN/KH-
M>"C0G@M59PBF0YCJ$*0H&$YA,4``H!^(1'?Z:MEU<6T$1N+AS1:MKU$D4]*\
M_)18UTSO;BJYQ---4BMCS/5XA9RPC3N++*-#`@>-A4_?_P!TJ<")M3/>K3Y/
M<(")"&54*&^Y-:DS?>3#65Y_IL(QTEP33X1U?PJKI%MV9VLU6C]6BW(J5R5.
M$]Q6"A:HD(F!(\BY>33HY.XO88S)F+`J(]@]1,IN`_Y=7+$R[US\C7W#70V-
M:CJ!!IYUHIY8[>U:8@X.+=/#\DK;$JR:)".52JK@0GNJ%("93J"'XA(3<W:3
M<.@"(B`>HZVE:`,B$%#[C!J:<5:7O#S5O!;NX?:'^.O4=.*D6=$0T1#1$-$0
MT1>3&`H;B(`'W_;J4?$X@_*$15M=HA:M#O)N:?(L(^.(*B[A0_:(#L(>TF&P
M_GG$=BAZB(ZPS=^^<)LO$S97)R!MI`VKP/F/Z6CQ)*]UA87>1N!;6@+G'YO(
M>:9M*7&X9AE6T%&M5XR`ET0<Q]4*L=I*2\050Q?W+:91`X/(JL'4`OY*0@J[
M.7VBB&XB'$\F_P#?'?//>UMGJL<0Y_0R'@'L)H97?J`U]5L08C&[9M/?+@;R
ME2>3N0'/\Z<4Y2@8TC:0U24,"+V<,@T0>RA6P-$0!!,W^TB&0=R49'%,?8B9
M-S^ICF,8=]=4;#[<XK:%NTYB,3YD4_RTKKZK"LKFI[[4GX>7VX_\H\RLS#0C
M474K*,6""?05G;E)(@'`.A0]PP'.?[@W-K/KW,8VP#GW-S)4?VCP\E8VQF8U
M/$H@.<S4%LF9PK)2(M@`=G1:Y8_C&*41`3D6_2P(H01#H)1$!#T'6%WO=#:-
MM<,@O);N)AKJUKJ&G/1>Z+&N<>D#XG(UT^^56YME7E:G&,NV14*FH=LH.Z!S
M!N5-9)4"+)*"`^AB@.LBVSW#VKNUTD&$F$I@&M>*DN\7=69#G@B,H]@(#K-(
MY1(*A>-9U51#1$-$0T1<N0<H((KJ.%2II(D,JH=00*FFF1,RACG,/0"%*01$
M1^S5MRV0@Q6.GO+EX8QL;G5/Z0HADCGLAC!=),[I;3P*CQO%R')\W.S[PJR^
M,,=&*#9FD"O_`+/.K*)@Q3(4WMI.?F.=N\FYNQL40#JH&WR^WIW!R/<W<<N=
M@E<-EXN9[704^"26A8TGQ.NM*D+>6,PS=H8V.V>T?^AF'4Y_$^U2I!'`4--0
M*UHG1X4I:\%7RSDXD0]JM"2$G,K`F`'8IJE(=E`M0W,9LPC&Y@*5$@E(!]QV
MW'77G8;M\,#LZ+-9.,'+WTAD#OE+8R:M:`*`"G):SW-E!>7/0TFC33UYG[>J
M710@BGL7O`>T"E,`#WA]^Q@[0'KZCKHJDGM^UIT?;QXK&-?!<1&L0Z2I7)V2
M;AT0RATG3LA73I$R@[G]I98%#I!OZ`40`/IMJV_ZNR#RY\33KXBO\5,USF:M
M6TZ02*F0@D.<#EV$@$]1Z;[[AT#;_AJ2^QF,NK8V0MX2Y[222QIHT<?#315H
M9KC]R']7^,--?72B9A*';UOE!5F-9(DQ3L,2U1LC!H``FN9=-^H==PFEVIBN
M5%L0W?MN`@/77#5W<V6TOJ:L=M;+'LX:\A_S,826F0UJXUK3TX+;%C9G)=O+
MK,9`5F:3T$\="*)\2`CVFZ]>F_\`7\7]@UWU9-+;<5_[*:K3[J#@M@/0->QM
M:"O%%G440T18$=M2/=TBJ)NW)BT.*WC&8%HK\9W,JMH5%<.IRI/A$KPJ8!ZJ
M&:D.`#]`'7+OU4[JN,%V[?#;.,5U=.$;'5YFA"SOMUC8\IN.-DQ'MQ`O'J!I
M^::Q<Z\:E8IP[7ETE$49NP-K!9#)]`%<I6!BE,'^AJW=@)0W_P"HN^N0<K@X
MMD=OMNV[V]#;[)1RW3CIUL(ZM?(^:V):WPS^?R<]TX-]F`QL''@:?G37[N2D
M4CU`*F4Q0W*<B0D'<!W+L!`'?T].N^OJ-@I;.;&VDUD\'%26L?M`#1M&BHKX
MU6A)7.?D989&D%OCS^Y=CWB;[;AO]?K_`,_35ZKR:[\%+T/Y+R98@;[B'3[!
MW'?5&0G^YI#?Q_$>"E>[V@"_0%)MDG(<'C^`6FI5<G>`"FR8$,`NW[D0`WLM
M2;E.8$P#=0Y=P(7J.M1]U^Z&W^UVV+C,Y5[7WDD#V01M>.MSB*'3PH:+)-L8
M&ZSV3CMXOAMS\SR#1H--3_(>*;CQ]J,]:+9,9GMJ0)KRRCPL`U.F81327]M`
MSU$5MUDFI6J8((AOL<HB8`#?7+GTP;'W'N;<TG=C=L;FPR]7[;K%3J:@U]/)
M;&WYE[/%X.+9N,(/LNK(\'1_E3GXZDI[*8=/3M]`]=_3IKZ"L;T<."TJ[XE]
M=3HAHB&B+`ZIR@D:*(35.63$R^.4I+M$S>"GXV0=D`HF[T%068[B`?1,SG</
MOUQS]7^'N<ELVSG<TMM[6Z:ZO@=0:+8W;*ZAMMPUF<&@QN`)X5IP^];V3Z,7
M)V+(I2!V6E(R.93<#V*]I7*A&*156.Y>[;Y3,PE#_28"ZH]Q.WDG<?LC;7N.
M8[]_:X]CXFMXN<T#1M/%2X3-MV]NBX;?-K#/,YKJ\B:]7W?S2;8PY(1\='IU
M;(A'45*PQ"L1DQ;N%BNDFXBWV>H)HBZ:/">WL;N(9,WJ!@$>FJ>S/U56VU\;
M!V_[BP268LV='NR@M.F@H>?)9'N3MG=9RZ.6VP?<B?\`$6L(J*ZD<J>26<_(
M'$J20F&XLA`"[C[:#\ZP?]ID@:=W=]VND'_5+V4@MB69=[GTX`U*Q%W;/=S?
MFMIQZT_J4EMEY2,%W(0^-8)];91<_MMG2J#ENR[S``;)(IIG<KK)&$![3`F`
M_=ZZTQN/ZN+O*7,F%[46<U[>/=TF1S2>.E1Z*]XKM@:_N=Q7#((V_P!KCJN5
M5L+7+(,RG;,T.';DJ1A%K6E#(D%1`Q1,0BI6BHHQ[0JQMP33'WS@`=X_35EV
M7]/6\.XF?&\NZLMPZW:X/%L\D-^+4](X`"FJ]V;WAA]OXU^,VNQKY@*&1NM?
M,<SY\$]&+9(LFZ+9NW^.@@DDDD@4@$2232(!$TTP#_(0I0VUWYA<+#A+&+&V
M0:S&1-`CC`ITT6H);F>[I<W!/O/-2#QUYKK:O:IH:(AHB&B(:(BI:8%C8X>2
M@I-(J\?*-56;DAB@(@55,P%.41W[3D/VF*/T$NL4W=M^QW'B9<5DH_>M9V%M
M#J&&FCARU7HL[Z3&WD=RTT'4D-HTF_QB@6@WDZR<1%J`A5+J9$2P\G'F$`0C
M954HJ!&2K`P]AA7[4U0ZE'6D=@Q93MA%)LO=/7/8OF+[=^I`C/!I_2`5?<TV
M/,W`O826RT!(_+[?U1[L6*\>7H4I*8@&3UV<H=DBS64:N5B#U`/F,C@=9,`Z
MAN(E^P=9'N_L;VV[@1"XS%K"]T@XQ`5UYD</55K'=.?PC/;L[AX8/#[<T5DN
M-F*DC`K^@.U@[@/[:TO)'2,.^^QR@X(8X?<([:PJS^D'L]C3\&,,WJ]>J7N/
MNJ84]QP2K0%,KE;;IH0<%&QB1/0&S9-,^X^IA4*7O.<?M,(CK:6U^U^Q-H],
M>(Q+(2P4!H"?QIJK!>9O+Y(E][,X]7@2?X<$:D2"0P@```&'?TWZ_40]!`1U
MM&`!H(8.F/P"M`C#"7!Q<X\5MZ]"BAHB&B(:(AN'VZ(AHB^"P`8-@`!$?ITW
M';;^VH=(U\^*@YH<*.%0%HN&"#HID5445T3DV5263(HDIU#HHF<!*</Z[ZMF
M4Q=IDV#]S&Q\@&A<`2!R5022#@XA:\?"L(URNX9LFK8[@B:2IT2%()R)B':0
M2%V*4A``-@#H&J.&Q,6-:X1M#0?`:!0)<?F.J[G:'V!J\M`8*-T"A4KR'8'0
M``/_`!V_MJ:I/%0)+N.J]``!Z`&H*`:!P"SO]/KHHH:(L`8H[;#Z^GT^_P!!
MT19T11=9J\M'$[CCS&H'"3/\W=,.92RVC$+XFNEWJ2K/!^033SIU'Q<;$Y4:
MN7D-%39IAK^GJ-)`K8Z;Y=NF<2@X2,<BDR2=J`BF*B8D..R>RG<7\8AMN8!`
M#%$IPV$-A^FPCN&B*-#%7EHXCY^YG77@M@*?NN9,OXK2GG&7;31*4\DL,8K"
MNF!M)MK=E-TX:0AGYITP1**,>5Z923[T@'9)4Q2(I>03S5<%O&I.UFC<B\@S
MLCE:XQQI6O8?Q+639%R.M'J"5.+>R\*P>-6]:96!R<$8Y207;?.4(I[13$()
MM01,+IO\J+QX/;C`TW-=#Y<<4C6F191D!:.0>"'E=J+I5\]39?*>R<'+3KV,
MBV1E/<<NCM3(MT0,<Y@[1#0BI!JBL;5NXP%PAHRP56:A[)!33)K(0]@@)-E-
M0<PP>()N6<C$RT8NZCI&.>HJ=R*Z*ITE"B`@;KJ*)G_"3R)<8_(!3K?<^.=Y
M/8`QY>YS'&1*A/L/V[?*':X)R+99M8:HLX7?(QD@(=S"0)WLGH%."9^])4A"
M)Z%BL4-5X.6L5@E8R!@8.)D)R;G)M^VBHB%AHEL=[)RLK)/%$FD?',&:9E%E
ME#E(D0HF,/:`Z(F8\$_(9QQ\B]#ON4N+MEFKECS'V4IO$<A:):N.ZTSF[-`Q
M4/,/'U8;R)RR4A6UV4ZW%N[61;F6_$()@78=$3B,\YRQOQMQ/D#.68+2PI6+
ML65.5NEYLT@"AT(F!B$@.NLFBB11=Z]<J&*@U:HE.NZ=JI(IE$ZA=B(I\4>3
MN+N8^`,8<E\)R[R>Q3EVOFL5-DI2+5A)<&:#]]$/6<S$+J*+1TK'RT6NW71$
MQ@(=/H8P"`B1./T11`>9SQ>4?RD<2;%B)Z9C7,STQ=U=N.635VOR'5'R0D1N
MX&)66*X;*,JKD0(Q&*EE2&W;I*$=E**S9,=$52,/.MY$XSA\MX:%\0Y-?>7I
MODMQP[:Y'9.FCZ5945%%O#DMSF21_5C364TX0%XM293,FR&*$M@!V)P,&B*V
M'XCO&+C;Q$\-PH+,S2TY5G8Q3)W)3*B*21GM^OK.&,]?P\.NY*+U&B5-F@HQ
MAT5#!W;KO%"^^[4$"*`[^-+AFM>0?E7Y!O+[R-JE:R%D67Y(.:Q@P+;#ISKC
M%;[X3JPR$K4U9,R[*.=PU+L$)"L#D2%1HBT.*1TN[J16H?(;PSQ-SHXG9FP%
MEZBP%U:V&@6M6E/I5JT_6J9D%M!O5J?;:E.N$5WE;FXN<31-\A`Q>]$3I*]Z
M*BB9B*"G^('R`NV5?&Y></Y"L;JP3'%CD%9<5UEJ]1`5JQCN3K=?M4!6TI`#
M&%^PC['(3/QP'86Z0@D'X"E#1%6)\6%KS[P$GN1GF#Q<M/7K`F(.:]LXP\X\
M)1#=FD+[CQ?GZ,W&911D%BO%SOZ9?YMD**:385B.?9+[J;=PY'1%9$\M_+"5
M\I]TX\>(+Q[Y5C9R&Y7T*$Y`<L>155.M+5O%?$5-FG:(^(DS,545F4E?/9:K
M/&"YD%E!48QJY"@^5!,BWOX<C-O%^.?D&P254<-XWFQDUFFX63(DLL@TQ_C%
MNDLJFD)DTU#ID`3%*(E*(B`=-$7O^4CG7(N5:CQ&\2O'!X\?9SY\Y?KQ[-7&
M2*S9-UAVK3/MM2S$NN*+-C"/K\W0D'/XA,#.ON#'["!^,B+G\>"Y6+@?RQYQ
M>"_,%BF[-,X!M[O//'FYR*3UC%6G%=DCJPXLK2)AGA3I1"+DUACILI6RAD5G
M+U_V]$A$2*W^!RB`F`>@#U'_``Z_TV'?^FB**[RY>3C&?BZXC7C/EM"*G,AO
M$754P5B^2?(,7F3<G/&Y",614%5D'2U6JI'B<I-JMQ,HG'H'*3\U1,!(J89/
M$)Y17?&97SZERS=&'DZ=Y,<<NV^$HZK`WE7&')!NQ!`A8E(R*L99#U=5P\<U
MA1$[$]-`(L4BN>X@$5R;Q;>1O$WEJX:1>7J:X:0MH=1#C''(+&23Q!:3Q=DE
MU!';3S)!`RAW"M2FTG(OX)V?HZ8J%(/YZ2Y$R*OG_&#R_$<(>0WD)\0F>9B"
MIV8:/R3F;=B9I-SC./=Y1^-''KUBC*;&N`(I,N@JE8BK`W*B<ZSAC(=Q""!!
M$"*U3SSY<XLX4<5,T<A<NVZ'ID#3*+9!@3S)R@[M%X>0SQ&FT^M1!E$WM@GY
M^?.BW2:-RF,)!.J<2))J'*15_OX?>"+SCGQWY3S5?ZU*UQ]RBY%V/(]65DT1
M:I66B059K];C;1$-#$*<D/(6<)A)!7<2+D0`Y!$@@(D2(_Q6\>4[+/%KRJXR
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M'_FYX3\GN+WFPYV1?%^Z!Q=NU`Q;:2\4Y*P0C^<Q?9)BQ)RL3D1J:M1J`P4P
MRGWT021774(BX>M$3)"02=I%?C3S;C0<&..0HV^NAAXN-B9@+>?U%D%:-CX:
MTG<1L`2^_P"G#&?H0^Y[P#V;!OM]I%`[Y"<?>)1#R6\9;YY+<ZY#?YL>&J3?
MB/A3+$!E5GP\AGS:=DVC9ZE-PF*U\+REOD;FHFZE/W-:$E4U2,".TBM@:E5(
MK&"Q6GQ2@H<H@"B?R#*;;&-V'[_D;$]OV/;[M^X`3[-]_P`.^B*N+X^<=^(-
MSY->3%]\:&>LA1F>8P;0ES'PEB.`R4]XF695W-N&1EY.;L6)B8AAY:*NI7#V
M$-5K3^8X,^3:I';?*(!$C/F_QWX$,D<@L<0?.S/5DX^\Y0@(\<?W7BY7LN6?
MD"#-91`E,_>$1A3%.5%72[1TF)Z^29;-9`R*B@,CBCT*11&0W%[^/MC:TTB<
MY_>2SR-\D8`MW8*8XIW+W!?.O%N)/W*FZ144;R;NU\<H]N]]]F`)R1_U1BW^
M&)Q7[$>_1%?8Q,&+_P#Y[1#84-2`Q9^V(O\`^<IXU"'''W[0!L`PHTPT`4*\
M%<,UV!`&7<V`O9V#L`;D44WA&J/C:I>%,]PGC;RE.Y>K0<F+R]Y`7&X1-SAK
M@?.CME%+3<2_CKK1,>NV\+%Q/L)1XLV2T>8G>9-RJK[PZ(IH)/V19.2N-@:B
MV<_)/N8`*W%$X.!_+*<X[(B8>@"/3IUT15TO&WBSQG-?'1S>K'C?Y+YR?\6+
MKD3-;_*F1X:I9'/E7#UB>8UKJ63(/$49;\.0UYL3R+I+4BD6LUAIIZ+EU_M5
M'#E,I`(I"_$E&<`8?@]BV,\:=B@;5Q4CU)]I`V&.0G$+%-VM&47)<)/)B5K@
MJS<DLA.I(`,]+,1[-V"(H]B1&WL%`B5_R!H<4W7#?D2VYM/(>.XG.,73"&='
M\O\`N$46-+66:IE>,`J3&2M0V%K+F;*1`1;=>2&3*A\5,ZW:42*-9GBWQ_(^
M!B5H+GDMGIWXRG6&TI%AF\]2MR678SC&7(C"<-7DH-'#Q,@NJLI'MUX7Y*M6
--*!6G!E>[8B;L"+_V3\_
`
end
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
