In this Kemp elimination, a catalytic base abstracts a proton from 5-nitro-benzisoxazole ring resulting in ring-opening and the formation of nitrile and hydroxy groups on a phenyl ring. Unlike most enzyme-catalyzed reactions, the mechanism for this reaction is quite easy to model.
5-Nitro-benzisoxazole is unusual in that it is a high-energy molecule, and is unlikely to exist in nature. Still more unusual, the enzyme involved in this reaction was designed theoretically1, then built.
In the system shown, the hydrogen atom on the hydroxyl on tryptophan 128 should most likely point towards one of the oxygen atoms on the nitro group. This did not happen by default in the geometry optimization, but could be done if the atom was moved by editing the structure.
The isoxasole ring is very highly strained in the original PDB structure1, but when the system is allowed to relax, even slightly, the ring quickly takes on the expected almost symmetrical pentagonal shape.
Note that both residues, Glu-101 and Lys-222, involved in the mechanism are ionized.
1: Röthlisberger, Daniela, Olga Khersonsky, Andrew M. Wollacott, Lin Jiang, Jason DeChancie, Jamie Betker, Jasmine L. Gallaher et al. "Kemp elimination catalysts by computational enzyme design." Nature 453, no. 7192 (2008): 190-195.