EXHIBIT 7
Execution Copy
FUNDING AGREEMENT
FUNDING AGREEMENT made as of this 7/th/ day of January, 2000
among:
(1) ELAN PHARMACEUTICAL TECHNOLOGIES, a division of ELAN CORPORATION, PLC, a
public limited company incorporated under the laws of Ireland, and having
its registered office at Lincoln House, Lincoln Place, Dublin 2, Ireland
("Elan");
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(2) ELAN PHARMA INTERNATIONAL LIMITED, a company incorporated under the laws of
Ireland, and having its registered office at Wil House, Shannon Business
Park, Shannon,, County Clare, Ireland ("EPIL");
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(3) ELAN INTERNATIONAL SERVICES, LTD., an exempted limited liability company
incorporated under the laws of Bermuda, and having its registered office at
Clarendon House, 2 Church St., Hamilton, Bermuda ("EIS"); and
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(4) RIBOZYME PHARMACEUTICALS, INC. a corporation incorporated under the laws of
Delaware and having its principal place of business at 2950 Wilderness
Place, Boulder, Colorado 80301, United States of America ("RPI").
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RECITALS:
A. EIS and RPI have formed a Bermuda exempted limited liability company known
as Medizyme Pharmaceutical Ltd. ("Newco").
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B. Elan and EPIL are beneficially entitled to the use of certain patents which
have been granted or are pending in relation to the Elan Intellectual
Property.
C. RPI is beneficially entitled to the use of certain patents that have been
granted or are pending in relation to the RPI Intellectual Property.
D. As of the date hereof, Elan and EPIL have entered into license agreements
with Newco, and RPI has entered into a license agreement with Newco, in
connection with the license to Newco of the Elan Intellectual Property and
the RPI Intellectual Property, respectively.
E. Elan, EPIL and RPI have agreed to co-operate in the research and
development of a business for the research, development and
commercialization of the Products based on their respective technologies.
F. As of the date hereof, Elan, EPIL, EIS, RPI and Newco have entered into a
Subscription, Joint Development and Operating Agreement, dated as of the
date hereof (the "JDOA") for the purpose of recording the terms and
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conditions of the research, development and commercialization of the
Products and governing certain aspects of the affairs of and their dealings
with Newco. Capitalized terms when used in the Recitals hereto and in this
Agreement shall bear the same meanings as ascribed to such terms in the
JDOA.
CLAUSE 1
DEVELOPMENT FUNDING
1.1 It is estimated that Newco will require an additional U.S.$15,000,000 to
commence development of the Products based upon the RPI Intellectual
Property, the Elan Intellectual Property and/or the Newco Technology (the
"Development Funding"). Within the Development Period, EIS and RPI may
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provide to Newco, by way of an unconditional gift to Newco, as contributed
surplus or loan, as may be agreed to by EIS and RPI, up to an aggregate
maximum amount of U.S.$15,000,000, such funding to be provided by EIS and
RPI to Newco on a pro rata basis based on their respective equity
interests, on a fully-diluted basis in Newco.
1.2 The Development Funding shall be provided by EIS and RPI, each in its sole
discretion, at such times as shall be necessary for the development of the
Products as provided in the Development Plan or as otherwise approved by
the Newco Directors, including at least one Newco Director designated by
EIS and one Newco Director designated by RPI. The Development Funding
shall be funded on the following terms:
1.2.1 The minimum amount of each disbursement of the Development Funding
shall be U.S.$312,500 (except in the event that an amount less than
U.S.$312,500 remains available for funding, in which case such
lesser amount may be funded) allocated between EIS and RPI as
provided in Section 1.1 above;
1.2.2 Such funding shall be provided in accordance with the Development
Plan or as otherwise approved by the Newco Board of Directors
(including at least one Newco Director designated by EIS and at
least one Newco Director designated by RPI); and
1.2.3 Such funding shall be subject to the receipt by Elan or EIS of any
required approvals under the Mergers and Takeovers (Control) Acts
1978-1996 (the "Irish Mergers Act").
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1.3 In the event that Elan or EIS is unable to obtain approval under the Irish
Mergers Act within three months after a determination of the necessity of
such funding by the Newco Directors, the parties hereto shall work together
in good faith, each in its sole discretion, to agree on an alternative
funding mechanism.
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1.4 Each request for Development Funding shall be delivered from the Management
Committee to each of the Stockholders upon 15 business days' prior written
notice, which notice shall set forth:
(i) the amount of the Development Funding requested;
(ii) the date requested to fund such amount; and
(iii) a reasonably detailed narrative and summary of the uses and
application thereof.
CLAUSE 2
TERMINATION
2.1 This Agreement shall govern the funding methodology of EIS, Elan and RPI
with respect to Newco until terminated by written agreement of EIS and RPI.
CLAUSE 3
GENERAL
3.1 [intentionally omitted]:
3.2 Further Assurance:
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At the request of any of the Parties, the other Party or Parties shall (and
shall use reasonable efforts to procure that any other necessary parties
shall) execute and perform all such documents, acts and things as may
reasonably be required subsequent to the signing of this Agreement for
assuring to or vesting in the requesting Party the full benefit of the
terms hereof.
3.3 Reliance on Representations and Warranties:
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Each of the Parties hereto hereby acknowledges that in entering into this
Agreement it has not relied on any representation or warranty except as
expressly set forth herein or in any document referred to herein.
3.4 Force Majeure:
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Neither Party to this Agreement shall be liable for delay in the
performance of any of its obligations hereunder if such delay is caused by
or results from causes beyond its reasonable control, including without
limitation, acts of God, fires, strikes, acts of war (whether war be
declared or not), insurrections, riots, civil commotions, strikes, lockouts
or other labor
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disturbances or intervention of any relevant government authority, but any
such delay or failure shall be remedied by such Party as soon as
practicable.
3.5 Relationship of the Parties:
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Nothing contained in this Agreement is intended or is to be construed to
constitute Elan, EPIL or EIS, on one hand, and RPI, on the other hand, as
partners, or Elan, EPIL or EIS as an employee or agent of RPI, or RPI as an
employee or agent of Elan, EPIL or EIS.
No Party hereto shall have any express or implied right or authority to
assume or create any obligations on behalf of or in the name of another
Party or to bind another Party to any contract, agreement or undertaking
with any third Party.
3.6 Counterparts:
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This Agreement may be executed in any number of counterparts, each of which
when so executed shall be deemed to be an original and all of which when
taken together shall constitute this Agreement.
3.7 Notices:
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Any notice to be given under this Agreement shall be sent in writing by
registered or recorded delivery post or reputable overnight courier such as
Federal Express or telecopied to:
Elan at:
Lincoln House, Lincoln Place, Dublin 2
Ireland
Attention: Vice President & General Counsel
Elan Pharmaceutical Technologies,
a division of Elan Corporation, plc
Telephone: 353-1-709-4000
Fax: 353-1-709-4124
with a copy to:
Brock Silverstein LLC
800 Third Avenue, 21/st/ Floor
New York, NY 10022
Attention: David Robbins
Telephone: 212-371-2000
Fax: 212-371-5500
EPIL at:
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Wil House
Shannon Business Park
Shannon, Co. Clare
Ireland
with a copy to:
Brock Silverstein LLC
800 Third Avenue, 21/st/ Floor
New York, NY 10022
Attention: David Robbins
Telephone: 212-371-2000
Fax: 212-371-5500
EIS at:
Elan International Services, Ltd.
102 St. James Court
Flatts, Smiths FL04
Bermuda
Attention: President
Telephone: 441-292-9169
Fax: 441-292-2224
with a copy to:
Brock Silverstein LLC
800 Third Avenue, 21/st/ Floor
New York, NY 10022
Attention: David Robbins
Telephone: 212-371-2000
Fax: 212-371-5500
RPI at:
2950 Wilderness Place
Boulder, Colorado 80301
Attention: Chief Executive Officer
Telephone: (303) 546-8132
Fax (303) 449-6995
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with a copy to:
Rothgerber Johnson & Lyons LLC
1200 17/th/ Street, Suite 3000
Denver, Colorado 80202
Attention: Woody Davis
Telephone: (303) 623-9000
Fax: (303) 623-9222
Or, in each case, to such other address(es) as may from time to time be
notified by any Party to the others hereunder.
Any notice sent by mail shall be deemed to have been delivered within three
working days after dispatch or delivery to the relevant courier and any
notice sent by telecopy shall be deemed to have been delivered upon
confirmation of receipt by telephone. Notices of change of address shall be
effective upon receipt.
3.8 Governing Law:
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This Agreement shall be governed by and construed in accordance with the
substantive (as opposed to procedural) laws of the State of Delaware,
without giving effect to principles thereof relating to conflicts of laws.
Any dispute hereunder shall be adjudicated in a forum set forth in the
Securities Purchase Agreement.
3.9 Severability:
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If any provision in this Agreement is agreed by the Parties to be, deemed
to be or is or becomes invalid, illegal, void or unenforceable under any
law that is applicable hereto, such provision will be deemed amended to
conform to applicable laws so as to be valid and enforceable or, if it
cannot be so amended without materially altering the intention of the
Parties, it will be deleted, with effect from the date of such agreement or
such earlier date as the Parties may agree, and the validity, legality and
enforceability of the remaining provisions of this Agreement shall not be
impaired or affected in any way.
3.10 Amendments:
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No amendment, modification or addition hereto shall be effective or binding
on any Party unless set forth in writing and executed by a duly authorized
representative of all Parties.
3.11 Waiver:
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No waiver of any right under this Agreement shall be deemed effective
unless contained in a written document signed by the Party charged with
such waiver, and no waiver of any breach or failure to perform shall be
deemed to be a waiver of any future breach or failure to perform or of any
other right arising under this Agreement.
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3.12 Assignment:
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None of the Parties shall be permitted to assign its rights or obligations
hereunder without the prior written consent of the other Parties except as
follows:
3.12.1 Elan, EPIL, EIS and/or RPI shall have the right to assign their
rights and to delegate their obligations hereunder to their
Affiliates; provided, however, that such assignment does not result
in material adverse tax consequences for any other Parties and;
provided, that Elan, EPIL, EIS and/or RPI (if applicable) shall
remain obligated after such delegation.
3.12.2 Elan, EPIL, EIS and/or RPI shall have the right to assign their
rights and to delegate their obligations hereunder to a special
purpose financing or similar vehicle established by Elan, EPIL
and/or EIS or RPI, as the case may be, or in connection with a sale
of all or substantially all of the business of such Party to which
the Transaction Documents relate, whether by merger, sale of stock,
sale of assets or otherwise; provided, that Elan, EPIL, EIS and/or
RPI (if applicable) shall remain obligated after such delegation.
3.13 Whole Agreement/No Effect on Other Agreements:
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This Agreement and the other Transaction Documents set forth all of the
agreements and understandings between the Parties with respect to the
subject matter hereof, and supersedes and terminates all prior agreements
and understandings between the Parties with respect to the subject matter
hereof. There are no agreements or understandings with respect to the
subject matter hereof, either oral or written, between the Parties other
than as set forth in this Agreement and the other Transaction Documents.
No provision of this Agreement shall be construed so as to negate, modify
or affect in any way the provisions of any other agreement between any of
the Parties unless specifically referred to, and solely to the extent
provided herein. In the event of a conflict between the provisions of this
Agreement and the provisions of the License Agreements, the terms of this
Agreement shall prevail unless this Agreement specifically provide
otherwise.
3.14 Successors:
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This Agreement shall be binding upon and inure to the benefit of the
Parties hereto, their successors and permitted assigns.
[Signature Page Follows]
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IN WITNESS WHEREOF, the Parties hereto have executed this Funding Agreement
on the day first set forth above.
SIGNED
BY:_______________________
for and on behalf of
ELAN PHARMACEUTICAL TECHNOLOGIES,
a division of ELAN CORPORATION, PLC
in the presence of:__________________
SIGNED
BY:_______________________
for and on behalf of
ELAN PHARMA INTERNATIONAL LIMITED
in the presence of:__________________
SIGNED
BY:_______________________
for and on behalf of
ELAN INTERNATIONAL SERVICES, LTD.
in the presence of:__________________
SIGNED
BY: /s/ [ILLEGIBLE]^^
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for and on behalf of
RIBOZYME PHARMACEUTICALS, INC.
in the presence of: /s/ [ILLEGIBLE]^^
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