EXHIBIT 10.28
EXECUTION COPY
ASSET PURCHASE AGREEMENT
BETWEEN
NASTECH PHARMACEUTICAL COMPANY, INC.
(SELLER)
AND
QUESTCOR PHARMACEUTICALS, INC.
(BUYER)
DATED JUNE 16, 2003
CONTENTS
Page
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1. Definitions........................................................................................... 1
2. Purchase and Sale of Assets........................................................................... 6
2.1 Purchase and Sale............................................................................ 6
2.2 Excluded Assets.............................................................................. 7
2.3 Assumed Liabilities.......................................................................... 7
2.4 Security Agreement and Negative Pledge....................................................... 7
2.5 Certain Liabilities.......................................................................... 7
2.6 Deferred Transfer and Assignment of Certain Intellectual Property Rights..................... 8
3. Purchase Price........................................................................................ 10
3.1 Consideration................................................................................ 10
3.2 Initial Payment.............................................................................. 10
3.3 Deferred Non-Contingent Payments............................................................. 10
3.4 Contingent Payments.......................................................................... 11
4. Closing............................................................................................... 11
5. Grant of Licenses; Retained Rights.................................................................... 11
5.1 Grant of License to Know-How................................................................. 11
5.2 Reservation of Rights; Cross-License......................................................... 12
5.3 Ownership and Reservation of Rights.......................................................... 12
6. Representations and Warranties of Seller.............................................................. 12
6.1 Organization and Authority................................................................... 12
6.2 Authorization; Enforceability; No Conflict................................................... 13
6.3 Consents..................................................................................... 13
6.4 Title to Assets.............................................................................. 14
6.5 Assigned Contracts........................................................................... 14
6.6 Intellectual Property........................................................................ 14
6.7 No Violations; Orders........................................................................ 15
6.8 Legal Proceedings............................................................................ 15
6.9 Compliance with Law.......................................................................... 15
6.10 Brokers or Finders........................................................................... 16
6.11 Shelf Life of Assigned Property.............................................................. 16
6.12 No Other Agreements To Sell The Assets....................................................... 16
7. Representations and Warranties of Buyer............................................................... 16
7.1 Organization and Authority................................................................... 16
7.2 Authorization; Enforceability; No Conflict................................................... 16
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7.3 Consents..................................................................................... 17
7.4 Legal Proceedings............................................................................ 17
7.5 Brokers or Finders........................................................................... 17
8. Covenants............................................................................................. 18
8.1 Access....................................................................................... 18
8.2 Conduct of Business.......................................................................... 18
8.3 Commercially Reasonable Efforts.............................................................. 18
8.4 Confidentiality.............................................................................. 18
8.5 Non-Competition.............................................................................. 19
8.6 Non-Solicitation............................................................................. 19
8.7 Patent and Trademark Enforcement and Prosecution............................................. 20
8.8 NDA Prosecution.............................................................................. 20
8.9 Gel NDA Maintenance.......................................................................... 21
8.10 Product Maintenance.......................................................................... 21
8.11 Product Modification......................................................................... 21
8.12 Customer Information......................................................................... 21
8.13 Termination of Cord Agreement................................................................ 21
8.14 National Drug Code........................................................................... 21
8.15 Maintenance of Cross-Licenses................................................................ 22
8.16 Further Assurances........................................................................... 22
9. Conditions Precedent to Buyer's Obligations........................................................... 22
9.1 No Claim, Order or Proceeding................................................................ 22
9.2 Representations, Warranties and Covenants.................................................... 22
9.3 Secretary's Certificate...................................................................... 22
9.4 Bill of Sale................................................................................. 23
9.5 Assignment and Assumption Agreement.......................................................... 23
9.6 Supply Agreement............................................................................. 23
9.7 Taxes........................................................................................ 23
9.8 Listing and Account of Assigned Property..................................................... 23
9.9 Other Documents.............................................................................. 23
10. Conditions Precedent to Seller's Obligations.......................................................... 23
10.1 No Claim, Order or Proceeding................................................................ 23
10.2 Representations, Warranties and Covenants.................................................... 24
10.3 Secretary's Certificate...................................................................... 24
10.4 Assignment and Assumption Agreement.......................................................... 24
10.5 Security Agreements.......................................................................... 24
10.6 Supply Agreement............................................................................. 24
10.7 Other Documents.............................................................................. 24
11. Survival; Indemnification............................................................................. 25
11.1 Survival..................................................................................... 25
11.2 Indemnification by Seller.................................................................... 25
11.3 Indemnification by Buyer..................................................................... 25
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11.4 Procedures; No Waiver; Exclusivity........................................................... 25
11.5 Offset; Limitations.......................................................................... 26
11.6 Sole and Exclusive Remedies and Liability.................................................... 26
12. Taxes and Costs; Apportionments....................................................................... 26
12.1 Transfer Taxes............................................................................... 26
12.2 Transaction Costs............................................................................ 26
12.3 Apportionments; Refunds...................................................................... 27
13. Termination........................................................................................... 27
13.1 Termination.................................................................................. 27
13.2 Notice of Termination........................................................................ 27
13.3 Effect of Termination........................................................................ 28
14. Miscellaneous......................................................................................... 28
14.1 Public Announcements......................................................................... 28
14.2 Severability................................................................................. 28
14.3 Modification and Waiver...................................................................... 28
14.4 Notices...................................................................................... 28
14.5 Assignment................................................................................... 29
14.6 Captions..................................................................................... 30
14.7 Entire Agreement............................................................................. 30
14.8 No Third-Party Rights........................................................................ 30
14.9 Counterparts................................................................................. 30
14.10 Governing Law................................................................................ 30
14.11 Arbitration.................................................................................. 30
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INDEX OF SCHEDULES AND EXHIBITS
Schedule 2.1.1 Assigned Property
Schedule 2.1.2 Intellectual Property
Schedule 2.1.3 Assigned Contracts
Schedule 2.1.4 Studies and Records
Schedule 2.1.5 Regulatory Approvals
Schedule 2.1.6 Clinical Data
Schedule 2.1.7 Validation Lots
Schedule 2.2 Excluded Assets
Schedule 6.4 Certain Encumbrances
Schedule 6.10 Brokers and Finders
Exhibit 2.6.6 Spray Patent and Spray Patent Application Transfer Documents
Exhibit A Assignment and Assumption Agreement
Exhibit B Bill of Sale
Exhibit C Supply Agreement
Exhibit D Security Agreements
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ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement is made as of this 16th day of June,
2003, by and between NASTECH PHARMACEUTICAL COMPANY, INC., a Delaware
corporation ("SELLER"), and QUESTCOR PHARMACEUTICALS, INC., a California
corporation ("BUYER").
RECITALS
A. Seller has rights to a manufacturing procedure for the
preparation of an intranasally delivered cyanocobalamin formulation marketed
under the brand name NASCOBAL(R) and to a patent for the formulation of related
products, and is engaged, amonG other businesses, in the development of such
products for sale and distribution.
B. Seller desires to sell to Buyer, and Buyer desires to purchase
from Seller, certain assets relating to such products, for the consideration and
on the terms and conditions set forth in this Agreement.
C. In connection with, and as additional consideration for, the
asset sale and purchase described in this Agreement, Seller and Buyer desire to
enter into a supply agreement pursuant to which Seller will produce and sell to
Buyer all of Buyer's requirements for the Product on the terms and conditions
set forth therein.
NOW, THEREFORE, in consideration of the covenants and conditions set
forth in this Agreement, and other good and valuable consideration, the
sufficiency of which is hereby acknowledged, the parties agree as follows:
AGREEMENT
1. DEFINITIONS
Certain terms are defined in the text of this Agreement. In addition,
terms that appear in this Agreement with their initial letters capitalized shall
have the meanings set forth below unless the context expressly requires
otherwise:
"ACQUIRED ASSETS" shall have the meaning set forth in Section 2.1.
"AFFILIATE" shall mean, with respect to any Person, any other Person
directly or indirectly controlling, controlled by or under common control with
such Person. For the purpose of the definition of Affiliate, the term "control"
(including the terms "controlling" and "controlled") means the possession,
direct or indirect, of the power to direct or cause the direction of the
management or policies of a Person, whether through the ownership of voting
securities, by contract or otherwise.
"AGREEMENT" shall mean this Asset Purchase Agreement, including the
Schedules and Exhibits attached hereto and hereby made a part hereof, as the
same may be amended, modified or supplemented from time to time in accordance
with the provisions hereof.
"ASSIGNED CONTRACTS" shall have the meaning set forth in Section 2.1.3.
"ASSIGNED PROPERTY" shall have the meaning set forth in Section 2.1.1.
"ASSIGNMENT AND ASSUMPTION AGREEMENT" shall mean that certain
Assignment and Assumption Agreement, substantially in the form of Exhibit A
attached hereto.
"BILL OF SALE" shall mean that certain Bill of Sale, substantially in
the form of Exhibit B attached hereto.
"BUYER INDEMNIFIED PARTIES" shall have the meaning set forth in Section
11.2.
"BUYER'S ADVISORS" shall have the meaning set forth in Section 8.1.1.
"BUYER'S NDA OPTION" shall have the meaning set forth in Section 2.6.2.
"BUYER'S SPRAY PATENT OPTION" shall have the meaning set forth in
Section 2.6.5.
"CLAIM" shall mean any civil, criminal or administrative claim, demand,
cause of action, suit, proceeding, arbitration, hearing or investigation.
"CLOSING" shall mean the consummation of the purchase and sale of
certain of the Assets contemplated by this Agreement.
"CLOSING DATE" shall have the meaning set forth in Section 4.
"CODE" shall mean the Internal Revenue Code of 1986, as amended.
"CONFIDENTIAL INFORMATION" shall mean information concerning the
business, methods, products, strategies, operations, prospects, systems, plans,
policies, relationships with customers, suppliers, distributors and other
agents, and other sensitive, non-public information of either Buyer or Seller or
their respective Affiliates. The term "Confidential Information" shall not
include information that (i) becomes generally available to the public other
than as a result of a disclosure by the party subject to the obligation of
confidentiality with respect to such information (the "RECEIVING PARTY"), or the
representatives or Affiliates of such party, in breach of this Agreement, the
Confidentiality Agreement or any other confidentiality agreement, or any
fiduciary duty or other obligation of secrecy in favor of the other party and/or
its Affiliates; (ii) is or becomes available to the Receiving Party on a
non-confidential basis from a source other than the other party or its
representatives or Affiliates, provided, that the Receiving Party believes that
such source is not bound by a confidentiality agreement with, and does not have
a fiduciary duty or any other obligation of secrecy to the other party or
another Person with respect to such information; (iii) was rightfully in the
possession of the Receiving Party or any of its Affiliates prior to receipt from
the other party or its representatives or Affiliates, other than through prior
disclosure by any of them; or (iv) is discovered or developed by the Receiving
Party or any of its Affiliates independently of any use of the other party's
Confidential Information.
"CONFIDENTIALITY AGREEMENT" shall mean that certain Confidentiality
Agreement, dated as of March 14, 2003, between Seller and Buyer.
"CONTINGENT PAYMENT" shall have the meaning set forth in Section 3.4.
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"CORD AGREEMENT" shall mean that certain Wholesale Service Agreement,
dated as of October 1, 2002, by and between Seller and Cardinal Distribution.
"DEFERRED NON-CONTINGENT PAYMENTS" shall have the meaning set forth in
Section 3.3.
"ENCUMBRANCE" shall mean any lien, mortgage, deed of trust, pledge,
security interest, charge, condition, equitable interest, right of first
refusal, community property interest, covenant, option, title defect, claim,
restriction, variance, exception, or other adverse claim or interest or
encumbrance of any kind or nature whatsoever, whether or not perfected,
including, without limitation, any restriction on use, voting, transfer, receipt
of income or exercise of any other attribute of ownership.
"ENFORCEABILITY EXCEPTION" shall mean, with respect to any agreement,
contract or commitment, any limitation thereon imposed by any bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium or similar Law
affecting creditors' rights and remedies generally and by general principles of
equity, including principles of commercial reasonableness, good faith and fair
dealing (regardless of whether enforcement is sought in a proceeding at law or
in equity).
"EXCLUDED ASSETS" shall have the meaning set forth in Section 2.2.
"EXHIBITS" shall mean the Exhibits hereby incorporated into and made a
part of this Agreement for all purposes.
"FDA" shall mean the U.S. Food and Drug Administration, and any
successor agency or entity thereto.
"GEL IND" shall mean the Investigational New Drug Application, No.
25,696, relating to the Product in gel form, and received by the FDA on January
22, 1985.
"GEL NDA" shall mean the New Drug Application, No. 19-722, relating to
the Product in gel form, and approved by the FDA on November 5, 1996.
"GOVERNMENTAL ENTITY" shall mean a federal, state, provincial, local,
county or municipal government, governmental, regulatory or administrative
agency, department, commission, board, bureau, or other authority or
instrumentality, domestic or foreign, including, without limitation, any body
exercising or entitled to exercise, any administrative, executive, judicial,
legislative, police, regulatory or taxing authority or power of any nature.
"INDEMNIFIED PARTY" shall have the meaning set forth in Section 11.4.
"INDEMNIFYING PARTY" shall have the meaning set forth in Section 11.4.
"INITIAL PAYMENT" shall have the meaning set forth in Section 3.2.
"INTELLECTUAL PROPERTY" shall mean: (a) inventions and discoveries,
improvements thereto, and patents, patent applications, invention disclosures,
and other rights of invention, worldwide, including without limitation any
reissues, divisions, continuations and continuations-
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in-part, provisionals, reexamined patents or other applications or patents
claiming the benefit of the filing date of any such application or patent; (b)
trademarks, service marks, trade names, trade dress, logos, domain names,
product names and slogans, including any common law rights, registrations, and
applications for registration for any of the foregoing, and the goodwill
associated with all of the foregoing, worldwide; (c) copyrightable works,
copyrights, website content, and other rights of authorship, and any
applications, registrations and renewals in connection therewith, worldwide; (d)
trade secrets, Know-How, and any other confidential business and technical
information; (e) rights to exclude others from appropriating any of such
Intellectual Property, including the rights to sue for and remedies against
past, present and future infringements of any or all of the foregoing and rights
of priority and protection of interests therein; and (f) any other proprietary,
intellectual property and other rights relating to any or all of the foregoing
anywhere in the world.
"IRS" shall mean the U.S. Internal Revenue Service.
"KNOW-HOW" shall mean all material non-patented know-how owned or
controlled by Seller as of the date hereof which, in each case, are material to
the formulation, manufacture, use, marketing and sale of the Product and all
available summaries or references sufficient for identification purposes of
same.
"KNOWLEDGE OF SELLER" shall mean, with respect to a particular fact or
other matter, the actual current knowledge after reasonable investigation of the
Chief Executive Officer or Chief Financial Officer of Seller.
"LAW" shall mean any domestic or foreign constitutional provision,
statute or other law, rule, regulation or interpretation of any Governmental
Entity and any decision, decree, injunction, judgment, order, ruling or
assessment of any Governmental Entity or any arbitrator.
"LICENSED ASSETS" shall have the meaning set forth in Section 5.1.
"LOSSES" shall have the meaning set forth in Section 11.2.
"MARKS" shall have the meaning set forth in Section 6.6.1.
"MATERIAL ADVERSE EFFECT" shall mean a material adverse effect on the
Product.
"NDA" shall mean that certain New Drug Application to be filed by or on
behalf of Seller with the FDA for the spray formulation of the Product used in
the Phase III bioequivalency study completed and reported upon in December 2002.
"NDA CLOSING" shall have the meaning set forth in Section 2.6.1.
"NDC" shall mean a National Drug Code for the Product.
"ORDER" shall mean any award, decision, injunction, restraining order,
judgment, decree, writ, order, regulation, rule, subpoena or verdict entered,
issued, made or rendered by any court, administrative agency or other
Governmental Entity or by any arbitrator.
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"PATENTS" shall have the meaning set forth in Section 6.6.1.
"PERMITTED PURPOSES" shall have the meaning set forth in Section 8.4.
"PERSON" shall mean any individual, partnership, joint venture,
corporation, trust, limited liability company, unincorporated organization,
Governmental Entity and any other legal entity.
"PROCEEDING" shall mean any action, arbitration, audit, hearing,
investigation, litigation or suit (whether civil, criminal, administrative,
investigative or informal) commenced, brought, conducted or heard by or before,
or otherwise involving any Governmental Entity or arbitrator.
"PRODUCT" shall mean any product developed by Seller, existing as of
the date hereof, that contains cyanocobalamin as an active ingredient formulated
for intranasal delivery.
"PURCHASE PRICE" shall have the meaning set forth in Section 3.1.
"SCHEDULES" shall mean the Schedules hereby incorporated into and made
a part of this Agreement for all purposes.
"SECURITY AGREEMENTS" shall have the meaning set forth in Section 2.4.
"SELLER EMPLOYEE" shall have the meaning set forth in Section 8.6.
"SELLER INDEMNIFIED PARTIES" shall have the meaning set forth in
Section 11.3.
"SPRAY PATENT APPLICATIONS" shall mean (i) U.S. Provisional Patent
Application No. 60/451,899, "Cyanocobalamin Low Viscosity Aqueous Formulations
for Intranasal Delivery" filed March 4, 2003; (ii) U.S. Provisional Patent
Application Docket No 03-02P2, "Cyanocobalamin Low Viscosity Aqueous
Formulations for Intranasal Delivery" filed April 4, 2003; (iii) all U.S.
applications claiming priority from (i) and/or (ii) (including all
continuations, continuations-in-part, reexaminations, reissues and extensions
thereof); and (iv) and any additional patent applications with claims covering a
spray formulation of the Product.
"SPRAY PATENT CLOSING" shall have the meaning set forth in Section
2.6.4.
"SPRAY PATENTS" shall mean any patent claiming priority from any of the
Spray Patent Applications.
"STUDIES AND RECORDS" shall have the meaning set forth in Section
2.1.4.
"SUPPLY AGREEMENT" shall mean that certain Supply Agreement by and
between Buyer and Seller, in the form of Exhibit C attached hereto.
"TAX" (and, in the plural, "TAXES") shall mean (a) U.S. or foreign
federal, state or local taxes, charges, fees, levies, imposts, duties and
governmental fees or other like assessments or charges of any kind whatsoever
(including, without limitation, any income, net income, gross income, receipts,
windfall profit, severance, property, production, sales, use, business and
occupation, license, excise, registration, franchise, employment, payroll,
withholding, alternative
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or add-on minimum, intangibles, ad valorem, transfer, gains, stamp, estimated,
transaction, title, capital, paid-up capital, profits, occupation, premium,
value-added, recording, real property, personal property, inventory and
merchandise, business privilege, federal highway use, commercial rent or
environmental tax), and (b) interest, penalties, fines, additions to tax or
additional amounts imposed by any taxing authority in connection with any item
described in clause (a).
"TRANSACTION DOCUMENTS" shall mean the Bill of Sale, the Assignment and
Assumption Agreement, the Supply Agreement and the Security Agreement.
"USPTO" shall mean the United States Patent and Trademark Office.
2. PURCHASE AND SALE OF ASSETS
2.1 PURCHASE AND SALE
Subject to the terms and conditions of this Agreement, Seller shall
sell, transfer, convey, assign and deliver, or cause to be sold, transferred,
conveyed, assigned or delivered to Buyer, and Buyer shall purchase and acquire
from Seller, at Closing, all of Seller's right, title and interest in, to and
under the following (collectively, the "ACQUIRED ASSETS"):
2.1.1 TANGIBLE PERSONAL PROPERTY
The personal property identified on Schedule 2.1.1 hereof
(collectively, the "ASSIGNED PROPERTY").
2.1.2 PATENTS AND MARKS
The Patents and Marks identified on Schedule 2.1.2 hereof.
2.1.3 CONTRACT RIGHTS
The contracts, applications, agreements, licenses, obligations,
promises, instruments and other undertakings and arrangements identified on
Schedule 2.1.3 hereof (collectively, the "ASSIGNED CONTRACTS").
2.1.4 STUDIES AND RECORDS
Any marketing studies, promotional materials and other information
identified on Schedule 2.1.4 hereof (collectively, the "STUDIES AND RECORDS").
2.1.5 REGULATORY APPROVALS
All regulatory approvals and pending approvals permitting the sale of
the Product in the United States and all foreign countries identified on
Schedule 2.1.5 hereof and the right to file for approval in countries where the
Product is not approved.
2.1.6 CLINICAL DATA
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All clinical data and technical information identified on Schedule
2.1.6 hereof.
2.1.7 VALIDATION LOTS
All validation lots identified on Schedule 2.1.7 hereof.
On the Closing Date, Seller shall deliver to Buyer the Bill of Sale and
such other deeds, endorsements, assignment and assumption agreements, and other
good and sufficient instruments of conveyance and transfer as Buyer may
reasonably request, to vest in Buyer all the right, title and interest of Seller
in, to and under any or all of the Acquired Assets.
2.2 EXCLUDED ASSETS
The assets, properties, rights, contracts, claims or interests related
to the Product and listed on Schedule 2.2 hereof (the "EXCLUDED ASSETS") are not
being purchased by Buyer under this Agreement and are being retained by Seller.
2.3 ASSUMED LIABILITIES
2.3.1 Upon the terms and subject to the conditions of this
Agreement, effective at the time of the Closing, Buyer shall assume and become
responsible for all obligations under the Assigned Contracts arising on and
after the Closing Date (collectively, the "ASSUMED LIABILITIES").
2.3.2 At Closing, Buyer shall deliver its executed
Assignment and Assumption Agreement evidencing, among other things, its
assumption of the Assumed Liabilities.
2.4 SECURITY AGREEMENT AND NEGATIVE PLEDGE
At the Closing, Buyer shall enter into agreements, substantially in the
forms of Exhibit D attached hereto, giving Seller a first priority security
interest in the Acquired Assets and undertaking not to allow any other security
interest or Encumbrance to attach to the Acquired Assets (collectively, the
"SECURITY AGREEMENTS").
2.5 CERTAIN LIABILITIES
Notwithstanding the foregoing, certain obligations will be divided
between Buyer and Seller as follows:
2.5.1 Buyer will be responsible for all liability incurred
in connection with the use and sale of the Product or the Marks on and after the
Closing Date, and Seller will be responsible for all liability, whether known or
unknown, incurred in connection with the manufacture, use or sale of the Product
or the Marks prior to the Closing Date;
2.5.2 Buyer will be liable for any and all customer
chargebacks and returns for Products sold with Buyer's NDC, and Seller will be
liable for any and all customer chargebacks and returns for Products sold with
Seller's NDC;
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2.5.3 Buyer will be liable for any and all rebates for all
Medicaid and state rebate programs for all Products sold with Buyer's NDC and
paid for by Medicaid or state rebate programs and for which a qualified rebate
invoice is issued, and Seller will be liable for any and all rebates for all
Medicaid and state rebate programs for all Products sold with Seller's NDC and
paid for by Medicaid or state rebate programs and for which a qualified rebate
invoice is issued;
2.5.4 Buyer will be liable for any and all rebates for all
Product sold with Buyer's NDC and paid for by a managed care facility, and
Seller will be liable for any and all rebates for all Products sold with
Seller's NDC and paid for by a managed care facility; and
2.5.5 Buyer shall notify Seller of any demand made by a
customer of Buyer for the chargeback, return or rebate for Products sold to such
customer by Seller with Seller's NDC, as set forth in Sections 2.5.2 through
2.5.4. Seller shall exercise its commercially reasonable efforts to resolve the
customer's claim for chargeback, return or rebate of the Products. Upon the
expiration of ninety (90) days from the date upon which Buyer shall have
notified Seller of the customer's demand, and to the extent that Seller shall
have been unable to reach agreement with the customer on the resolution of such
claim, Buyer may allow any reasonable chargeback, return or rebate or may
reprocess the Products, and the reasonable out-of-pocket costs thereof shall be
borne by Seller. Such amounts shall be applied by Buyer to the following
Deferred Non-Contingent Payment or Contingent Payment.
2.6 DEFERRED TRANSFER AND ASSIGNMENT OF CERTAIN INTELLECTUAL
PROPERTY RIGHTS
2.6.1 Subject to the terms and conditions of this
Agreement, upon FDA approval of the NDA, Seller shall sell, transfer, convey,
assign and deliver, or cause to be sold, transferred, conveyed, assigned or
delivered to Buyer, and Buyer shall purchase and acquire from Seller, all of
Seller's right, title and interest in, to and under the NDA and all subsequent
FDA submissions by or on behalf of Seller with respect to the Product in spray
form (the "NDA CLOSING"). The NDA Closing shall be held at 10:00 a.m., New York
time, at the offices of Kramer Levin Naftalis & Frankel LLP, 919 Third Avenue,
New York, New York as soon as practicable following FDA approval of the NDA, but
in no event later than ten (10) days following the date of such approval, unless
another place, date and time is mutually agreed upon by Buyer and Seller. At the
NDA Closing: (i) Buyer shall pay to Seller the Contingent Payment due Seller in
accordance with Section 3.4, and (ii) provided that Buyer shall have made to
Seller each Deferred Non-Contingent Payment due Seller through such time in
accordance with Section 3.3, Seller shall provide to Buyer the original or a
copy (as mutually agreed to by Buyer and Seller) of the NDA together with a
receipt that notice of such transfer has been delivered to the FDA.
2.6.2 Subject to the terms and conditions of this
Agreement, if Seller abandons its pursuit of the NDA prior to such time as FDA
approval of the NDA has been obtained, then Buyer may, at Buyer's option,
exercised in writing (the "BUYER'S NDA OPTION"), request that Seller transfer,
assign and deliver to Buyer all of Seller's right, title and interest in, to and
under the NDA and all subsequent FDA submissions by or on behalf of Seller with
respect to the Product in spray form. No later than ten (10) days following
receipt by Seller of Buyer's NDA Option, provided that Buyer shall have made to
Seller each Deferred Non-Contingent Payment due Seller in accordance with
Section 3.3, Seller shall transfer, assign and deliver, or cause to be
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transferred, assigned or delivered to Buyer, and Buyer shall acquire from
Seller, at no cost to Buyer, all of Seller's right, title and interest in, to
and under the NDA and all subsequent FDA submissions by or on behalf of Seller
with respect to the Product in spray form.
2.6.3 Notwithstanding Section 2.6.1 and 2.6.2 above, Seller
shall retain a perpetual, royalty-free, non-exclusive license to incorporate,
disclose and otherwise use and have used all information relating to the NDA and
all subsequent FDA submissions by or on behalf of Seller with respect to the
Product in spray form, including but not limited to information collected or
developed under the NDA and all subsequent FDA submissions by or on behalf of
Seller with respect to the Product in spray form, to prepare, supplement and
prosecute the Spray Patent Applications and to perform in full Seller's
obligations under the Supply Agreement.
2.6.4 Subject to the terms and conditions of this
Agreement, upon issuance by the USPTO of any patent claiming priority from any
of the Spray Patent Applications with any independent claim covering any
formulation which treats any indication in the approved NDA, Seller shall sell,
transfer, convey, assign and deliver, or cause to be sold, transferred,
conveyed, assigned or delivered to Buyer, and Buyer shall purchase and acquire
from Seller, all of Seller's right, title and interest in, to and under the
Spray Patents and the Spray Patent Applications (the "SPRAY PATENT CLOSING").
The Spray Patent Closing shall be held at 10:00 a.m., New York time, at the
offices of Kramer Levin Naftalis & Frankel LLP, 919 Third Avenue, New York, New
York as soon as practicable following issuance by the USPTO of any patent
claiming priority from any of the Spray Patent Applications with any independent
claim covering any formulation which treats any indication in the approved NDA,
but in no event later than ten (10) days following the date of such issuance,
unless another place, date and time is mutually agreed upon by Buyer and Seller.
At the Spray Patent Closing: (i) Buyer shall pay to Seller the Contingent
Payment due Seller in accordance with Section 3.4, and (ii) provided that Buyer
shall have made to Seller each Deferred Non-Contingent Payment due Seller
through such time in accordance with Section 3.3, Seller shall deliver to Buyer,
at no cost to Buyer, such assignment and assumption documents as are reasonably
requested by Buyer in order to transfer to Buyer from Seller the Spray Patents
and the Spray Patent Applications.
2.6.5 Subject to the terms and conditions of this
Agreement, if Seller abandons its prosecution of the last of the Spray Patent
Applications prior to the issuance by the USPTO of any patent claiming priority
from any of the Spray Patent Applications with any independent claim covering
any formulation which treats any indication in the approved NDA, then Buyer may,
at Buyer's option, exercised in writing (the "BUYER'S SPRAY PATENT OPTION"),
request that Seller transfer, assign and deliver to Buyer all of Seller's right,
title and interest in, to and under the Spray Patents and the Spray Patent
Applications. No later than ten (10) days following receipt by Seller of Buyer's
Spray Patent Option, provided that Buyer shall have made to Seller each Deferred
Non-Contingent Payment and Contingent Payment due Seller in accordance with
Sections 3.3 and 3.4, respectively, Seller shall transfer, assign and deliver,
or cause to be transferred, assigned or delivered to Buyer, and Buyer shall
acquire from Seller, at no cost to Buyer, all of Seller's right, title and
interest in, to and under the Spray Patents and the Spray Patent Applications.
2.6.6 To effect the transfer of (i) the NDA from Seller to
Buyer pursuant to Section 2.6.1 or 2.6.2 above or (ii) the Spray Patents and the
Spray Patent Applications from
- 9 -
Seller to Buyer pursuant to Section 2.6.4 or 2.6.5 above, Seller shall deliver
to Buyer a bill of sale and such other deeds, endorsements, assignment and
assumption agreements, and other good and sufficient instruments of conveyance
and transfer as Buyer may reasonably request, to vest in Buyer all the right,
title and interest of Seller in, to and under the property being transferred.
Without limiting the generality of the foregoing, (x) simultaneously with the
transfer of the NDA from Seller to Buyer pursuant to Section 2.6.1 or 2.6.2
above, Buyer and Seller shall promptly file with the FDA and all relevant
Governmental Entities all information required in order to transfer to Buyer the
NDA and all subsequent FDA submissions by or on behalf of Seller with respect to
the Product in spray form; Seller shall file the information required of a
former owner, and Buyer shall file the information required of a new owner, in
each case at Buyer's expense; and (y) simultaneously with the transfer of the
Spray Patents and the Spray Patent Applications from Seller to Buyer pursuant to
Section 2.6.4 or 2.6.5 above, Buyer and Seller shall promptly file with the
USPTO and all relevant Governmental Entities all information required in order
to transfer to Buyer the Spray Patents and the Spray Patent Applications, in
substantially the form set forth on Exhibit 2.6.6 attached hereto.
3. PURCHASE PRICE
3.1 CONSIDERATION
The aggregate consideration for the Assets (the "PURCHASE PRICE") shall
be: (a) cash in the amount of up to Eighteen Million One Hundred Eighty-Three
Thousand Three Hundred and Thirty-Three Dollars ($18,183,333), plus (b) Buyer's
assumption of the Assumed Liabilities.
3.2 INITIAL PAYMENT
Buyer shall pay Seller an initial payment toward the Purchase Price in
the amount of Nine Million Dollars ($9,000,000) (the "INITIAL PAYMENT") at
Closing by wire transfer of immediately available funds to an account designated
by Seller. The Initial Payment shall be non-refundable and shall not be credited
against any fee or other amount required to be paid by Seller.
3.3 DEFERRED NON-CONTINGENT PAYMENTS
In addition to the Initial Payment, Buyer shall make to Seller
additional payments (the "DEFERRED NON-CONTINGENT PAYMENTS") as follows:
Date Amount of Payment:
- ---- -----------------
On or before September 30, 2003 $3,000,000
On or before December 31, 2003 $2,183,333
Buyer shall pay Seller each Deferred Non-Contingent Payment by wire
transfer of immediately available funds to an account designated by Seller.
- 10 -
3.4 CONTINGENT PAYMENTS
Subject to the terms of this Agreement, Buyer shall make to Seller
payments (each, a "CONTINGENT PAYMENT") within ten (10) days after the
occurrence of each of the events listed below, in the amount provided.
Contingent Trigger Event Amount of Payment
- ------------------------ -----------------
FDA approval of the NDA $2,000,000
Upon the occurrence of both (i) FDA $2,000,000
approval of the NDA and (ii) issuance
by the USPTO of any patent claiming
priority from any of the Spray Patent
Applications with any independent
claim covering any formulation which
treats any indication in the approved
NDA
Buyer shall pay Seller each Contingent Payment by wire transfer of
immediately available funds to an account designated by Seller.
4. CLOSING
Subject to the conditions set forth in this Agreement, the Closing
shall be held at 10:00 a.m., New York time, at the offices of Kramer Levin
Naftalis & Frankel LLP, 919 Third Avenue, New York, New York on the third
business days after the parties' satisfaction or waiver of the conditions set
forth in Sections 9 and 10 (or the waiver thereof by the applicable party),
unless another place, date and time is mutually agreed upon by Buyer and Seller
(the "CLOSING DATE").
5. GRANT OF LICENSES; RETAINED RIGHTS
5.1 GRANT OF LICENSE TO KNOW-HOW
Subject to Seller's reservation of rights as set forth in Section 5.2,
effective as of the Closing, Seller hereby grants to Buyer a personal,
fully-paid up, royalty-free, nontransferable, worldwide, non-exclusive license
under the Know-How to make, have made, use, promote, market, sell, offer for
sale, import and distribute the Product (except as to the promotion, marketing,
sale, offer for sale, importation and distribution of the Product in Israel)
(collectively, the "LICENSED ASSETS"). Seller shall not license the Know-How to
any Persons to research, develop, manufacture, sell, market, distribute or
license any product that contains cyanocobalamin as an active ingredient
formulated for intranasal delivery. Notwithstanding the foregoing, Seller shall
have and retain the right to use the Know-How: (i) to prepare, supplement, and
prosecute the Spray Patent Applications and the NDA; (ii) to perform in full
Seller's obligations under the Supply Agreement; or (iii) for any other internal
purpose. Should any licensee of Seller, through no fault of Seller, attempt to
use the Know-How of Seller to research, develop, manufacture, sell, market,
distribute or license any product that contains
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cyanocobalamin formulated for intranasal delivery, Seller shall use its
commercially reasonable efforts to assist and cooperate with Buyer in any
efforts Buyer may elect to undertake to prevent or halt such use of Know-How by
Seller's licensee.
5.2 RESERVATION OF RIGHTS; CROSS-LICENSE
5.2.1 Effective as of the Closing, Seller shall have and
retain at all times during the term of the Supply Agreement all rights and
licenses under the Patents, Marks, Gel NDA and Gel IND and other proprietary
rights and licenses of Buyer (by Buyer's grant of an exclusive license, with the
right to grant sublicenses, hereby made), in each case necessary to make, have
made and supply the Product to or on behalf of Buyer and to otherwise fulfill
Seller's obligations under this Agreement, the Supply Agreement or any other
agreement with Seller.
5.2.2 Effective as of the Closing, Seller shall have and
retain all rights and licenses under the Gel NDA and the Gel IND and other
proprietary rights and licenses of Buyer (by Buyer's grant of an exclusive
license, with the right to grant sublicenses, hereby made), in each case
necessary to pursue the NDA and to prosecute the Spray Patent Applications,
until the later to occur of (i) FDA approval of the NDA or Seller's abandonment
of its pursuit of the NDA; and (ii) issuance by the USPTO of any patent claiming
priority from any of the Spray Patent Applications with any independent claim
covering any formulation which treats any indication in the approved NDA or
Seller's abandonment of its prosecution of the Spray Patent Applications.
5.2.3 The parties agree that Seller shall retain all rights
to (including the exclusive rights to, and to license third parties to)
research, develop, make, have made, use, sell, offer for sale and import
products, processes and services using or containing cyanocobalamin as an
inactive or inert ingredient (including as a carrier).
5.3 OWNERSHIP AND RESERVATION OF RIGHTS
This Agreement does not grant to Buyer any right, title or interest
with respect to the Licensed Assets, Intellectual Property or Product, or any
right, title or interest with respect to any other products, services, uses or
other tangible or intangible matter whatsoever, other than those which are
expressly provided herein. Seller hereby reserves all rights and licenses not
specifically, expressly and exclusively granted to Buyer by the terms of this
Agreement.
6. REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represents and warrants to Buyer as follows:
6.1 ORGANIZATION AND AUTHORITY
Seller is a corporation duly organized, validly existing and in good
standing under the laws of its jurisdiction of incorporation. Seller has all
requisite power and authority to own, operate and lease its properties and
assets and to carry on its business as presently conducted and to perform its
obligations under all Assigned Contracts. Seller is duly qualified to do
business as a corporation and is in good standing under the laws of each state
or other jurisdiction, in which either the ownership or use of the Acquired
Assets by Seller, or the nature of the activities
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conducted by Seller, requires such qualification, except for those states where
the failure to so qualify would not have a material adverse effect.
6.2 AUTHORIZATION; ENFORCEABILITY; NO CONFLICT
6.2.1 Seller has the requisite corporate power and
authority to execute and deliver this Agreement and the Transaction Documents to
which it is a party and to consummate the transactions contemplated hereby and
thereby. The execution and delivery of this Agreement and the Transaction
Documents to which Seller is a party and the consummation of the transactions
contemplated hereby and thereby by Seller have been duly and validly authorized
by all necessary corporate action on the part of Seller, and no other corporate
action on the part of Seller is necessary to authorize the execution and
delivery of this Agreement or the Transaction Documents to which Seller is a
party or to consummate the transactions contemplated hereby or thereby by
Seller.
6.2.2 This Agreement constitutes the legal, valid and
binding obligation of Seller, enforceable against Seller in accordance with its
terms except as enforcement may be limited by the Enforceability Exception. Upon
execution and delivery by Seller of the Transaction Documents to which it is a
party, such Transaction Documents will constitute the legal, valid and binding
obligations of Seller, enforceable against Seller in accordance with their
respective terms except as enforcement may be limited by the Enforceability
Exception.
6.2.3 Neither the execution or the delivery of this
Agreement or the Transaction Documents to which Seller is a party, nor the
consummation or performance of any of the transactions contemplated hereby or
thereby by Seller will, directly or indirectly (with or without notice or lapse
of time):
(a) contravene, conflict with, or result in a
violation of any provision of the Certificate of Incorporation or the By-laws of
Seller; or
(b) contravene or conflict with, or result in a
violation of, or give any Governmental Entity or other Person the right to
challenge any of the transactions contemplated by this Agreement or the
Transaction Documents or to exercise any remedy or obtain any relief under, any
Order to which Seller, or any of the Acquired Assets, may be subject.
6.3 CONSENTS
No notices, reports or other filings are required to be made by Seller
with, nor are any consents, approvals or authorizations required to be obtained
by Seller from, any Governmental Entity or any other Person in connection with
the execution, delivery and performance by Seller of this Agreement or the
Transaction Documents to which Seller is a party, or the consummation by Seller
of the transactions contemplated hereby or thereby, except where the failure to
obtain any such consent, approval or authorization or to make any such notice,
report or filing would not have a Material Adverse Effect.
- 13 -
6.4 TITLE TO ASSETS
Except as set forth on Schedule 6.4 hereto, Seller has marketable title
to all of the Acquired Assets free and clear of all Encumbrances except for
liens for Taxes not yet due. Except for the Excluded Assets, the Acquired Assets
constitute all of the assets, properties, rights, contracts, claims and
interests related to the Product.
6.5 ASSIGNED CONTRACTS
6.5.1 Each Assigned Contract is in full force and effect as
to Seller, and to the Knowledge of Seller, each other party thereto, and
constitutes a valid and binding agreement of Seller, and to the Knowledge of
Seller, each other party thereto, enforceable in accordance with its terms,
subject to the Enforceability Exception.
6.5.2 Seller is in compliance with all applicable terms and
requirements of each Assigned Contract under which Seller has any obligation or
liability or by which Seller or any of the Acquired Assets is bound, except
where non-compliance would not have a Material Adverse Effect.
6.5.3 Seller has not received written notice, and to the
Knowledge of Seller, any other notice regarding any actual, alleged, possible,
or potential violation or breach of, or default under, any Assigned Contract,
except where such violation, breach or default would not have a Material Adverse
Effect.
6.5.4 Each Assigned Contract is assignable by Seller to
Buyer without the consent of any third party.
6.6 INTELLECTUAL PROPERTY
6.6.1 Schedule 2.1.2 contains an accurate and complete list
of (i) all domestic and foreign patents, pending patent applications and patent
applications in process but not yet filed, owned by or licensed to Seller as of
the date hereof which cover the Product in gel form, including, but not limited
to, the formulation, manufacture, use, marketing and sale of the Product in gel
form (the "PATENTS"); and (ii) all domestic and foreign registered trademarks
and service marks and pending applications therefor owned by Seller as of the
date hereof which incorporate the formative "NASCOBAL" (together with the
goodwill of that part of Seller's business associated with and symbolized by
such marks, the "MARKS"). Notwithstanding the foregoing, Marks shall not include
any marks incorporating Seller's house marks or corporate marks.
6.6.2 Seller owns all right, title and interest in and to,
or has the right to use, the Intellectual Property used by it as of the date
hereof in the formulation, manufacture and use of the Product in gel form
according to Seller's practices in accordance with the approved NDA, and there
are no Encumbrances or restrictions on the transfer of any interest held by
Seller in such Intellectual Property, except for liens for Taxes not yet due.
6.6.3 To the Knowledge of Seller, Seller has not infringed,
misappropriated or violated any Intellectual Property rights of any third party
in respect of Seller's formulation,
- 14 -
manufacture or use of the Product in gel form. Seller has never received in
writing, or, to the Knowledge of Seller, in any other manner, any charge,
complaint, claim, demand, or notice alleging that it has infringed,
misappropriated, or violated any Intellectual Property rights of any third party
in respect of Seller's formulation, manufacture or use of the Product in gel
form.
6.6.4 To the Knowledge of Seller, no third party has
infringed, misappropriated or violated any Intellectual Property rights of
Seller in respect of Seller's formulation, manufacture or use of the Product in
gel form.
6.6.5 To the Knowledge of Seller, no third party has
asserted or made any claim contesting or, otherwise challenged, (a) Seller's
ownership of any of the Intellectual Property in respect of Seller's
formulation, manufacture or use of the Product in gel form or (b) the validity
or enforceability of any of such Intellectual Property.
6.6.6 Seller has taken commercially reasonable measures to
protect the secrecy, confidentiality and value of the trade secrets and Know-How
in respect of Seller's formulation, manufacture or use of the Product in gel
form.
6.6.7 No approval or consent of any third party is needed
so that the interest of Buyer in the Intellectual Property assigned hereunder
shall continue to be in full force and effect following the transactions
contemplated by this Agreement.
6.7 NO VIOLATIONS; ORDERS
6.7.1 Seller is not in violation of, nor has Seller
violated any Order entered by any Governmental Entity which violation, after the
Closing, could materially and adversely affect Buyer's right, title and interest
to the Acquired Assets.
6.7.2 Seller is not subject to any Order that relates to
the Product or any of the Acquired Assets and, to the Knowledge of Seller, no
officer, manager, member, agent, or employee of Seller is subject to any Order
that materially prohibits such officer, manager, member, agent, or employee from
engaging in or continuing any conduct, activity or practice relating to the
Product.
6.8 LEGAL PROCEEDINGS
There is no pending Proceeding (i) that has been commenced by or
against Seller or that otherwise relates to or may affect the Product, or any of
the Acquired Assets, or (ii) that challenges, or may have the effect of
preventing, materially delaying, making illegal, or otherwise materially
interfering with, any of the transactions contemplated by this Agreement or the
Transaction Documents. To the Knowledge of Seller: (A) no such Proceeding has
been threatened, and (B) no event has occurred or circumstance exists that may
give rise to or serve as a basis for the commencement of any such Proceeding.
6.9 COMPLIANCE WITH LAW
All required filings with Governmental Entities relating to the Product
are current and complete in all material respects and are in compliance with the
Law.
- 15 -
6.10 BROKERS OR FINDERS
Except as set forth on Schedule 6.10 hereto, neither Seller nor any
Person acting on behalf of Seller has directly or indirectly incurred, nor will
incur as a result of any action taken by or on behalf of Seller, any liability
for brokerage or finders' fees or agents' commissions or any similar fees,
charges or payments in connection with this Agreement or the Transaction
Documents, or any transaction contemplated hereby or thereby. Seller shall pay
all fees and expenses due to any broker or finder identified on Schedule 6.10.
6.11 SHELF LIFE OF ASSIGNED PROPERTY
The Product in gel form included in the Assigned Property has a shelf
life expiration date on or after February 15, 2005.
6.12 NO OTHER AGREEMENTS TO SELL THE ASSETS
Neither Seller nor its Affiliates has any commitment or legal
obligation, absolute or contingent, to any other Person or firm other than Buyer
to sell, assign, transfer or effect a sale of the Acquired Assets (other than
inventory in the ordinary course of business) or to enter into any agreement or
cause the entering into of an agreement with respect to any of the foregoing.
7. REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Seller as follows:
7.1 ORGANIZATION AND AUTHORITY
Buyer is a corporation duly organized, validly existing and in good
standing under the laws of its jurisdiction of incorporation. Buyer has all
requisite power and authority to own, operate and lease its properties and
assets and to carry on its business as presently conducted. Buyer is duly
qualified to do business as a corporation and is in good standing under the laws
of each state or other jurisdiction in which the nature of the activities
conducted by Buyer requires such qualification, except for those states where
the failure to so qualify would not have a material adverse effect.
7.2 AUTHORIZATION; ENFORCEABILITY; NO CONFLICT
7.2.1 Buyer has the requisite corporate power and authority
to execute and deliver this Agreement and the Transaction Documents to which it
is a party and to consummate the transactions contemplated hereby and thereby.
The execution and delivery of this Agreement and the Transaction Documents to
which Buyer is a party and the consummation of the transactions contemplated
hereby and thereby by Buyer have been duly and validly authorized by all
necessary corporate action on the part of Buyer, and no other corporate action
on the part of Buyer is necessary to authorize the execution and delivery of
this Agreement or the Transaction Documents to which Buyer is a party or to
consummate the transactions contemplated hereby or thereby by Buyer.
- 16 -
7.2.2 This Agreement constitutes the legal, valid and
binding obligation of Buyer, enforceable against Buyer in accordance with its
terms except as enforcement may be limited by the Enforceability Exception. Upon
execution and delivery by Buyer of the Transaction Documents to which it is a
party, such Transaction Documents will constitute the legal, valid and binding
obligation of Buyer, enforceable against Buyer in accordance with their
respective terms except as enforcement may be limited by the Enforceability
Exception.
7.2.3 Neither the execution and delivery of this Agreement
or the Transaction Documents to which it is a party, nor the consummation or
performance of any of the transactions contemplated hereby and thereby by Buyer,
will directly or indirectly (with or without notice or lapse of time):
(a) contravene, conflict with, or result in a
violation of any provisions of the articles of incorporation or the bylaws of
Buyer;
(b) contravene or conflict with, or result in a
violation of, or give any Governmental Entity or other Person the right to
challenge any of the transactions contemplated by this Agreement or the
Transaction Documents or to exercise any remedy or obtain any relief under, any
Order to which Buyer may be subject; or
(c) contravene, conflict with, or result in a
violation of or breach of, any provisions of, or give any Person the right to
declare a default or exercise any remedy under, or to accelerate the maturity or
performance of, or to cancel, terminate or modify, any contract, agreement,
lease, note or other restriction, encumbrance, obligation or liability to which
Buyer is a party or by which Buyer is bound or to which any assets of Buyer are
subject.
7.3 CONSENTS
No notices, reports or other filings are required to be made by Buyer
with, nor are any consents, approvals or authorizations required to be obtained
by Buyer from, any Governmental Entity or any other Person in connection with
the execution, delivery and performance by Buyer of this Agreement or the
Transaction Documents to which Buyer is a party, or the consummation by Buyer of
the transactions contemplated hereby or thereby, except where the failure to
obtain any such consent, approval or authorization or to make any such notice,
report or filing would not have a material adverse effect.
7.4 LEGAL PROCEEDINGS
There is no pending Proceeding that has been commenced against Buyer
that challenges, or may have the effect of preventing, delaying, making illegal
or otherwise interfering with, any of the transactions contemplated by this
Agreement or the Transaction Documents.
7.5 BROKERS OR FINDERS
Neither Buyer nor any Person acting on behalf of Buyer has directly or
indirectly incurred, or will incur as a result of any action taken by or on
behalf of Buyer, any liability for brokerage or finders' fees or agents'
commissions or any similar fees, charges or payments in
- 17 -
connection with this Agreement or the other Transaction Documents, or any
transaction contemplated hereby or thereby.
8. COVENANTS
8.1 ACCESS
During the period commencing on the date of this Agreement and ending
on the earlier of the Closing Date or the termination of this Agreement pursuant
to Section 13 hereof, and after advance notice from Buyer, Seller shall (i) give
Buyer and its accounting, legal, business, environmental, engineering,
intellectual property and other representatives and advisors (collectively,
"BUYER'S ADVISORS") reasonable supervised access, during normal business hours,
to the offices, properties, books and records of Seller related to the Product
and (ii) make available Seller's employees and advisors, including, without
limitation, officers and management personnel, and cause Seller's employees and
advisors to furnish Buyer and Buyer's Advisors with data and other information
related to the Product as may be reasonably requested by Buyer and Buyer's
Advisors, and to discuss the Product with Buyer and Buyer's Advisors, provided
that any contact between Buyer and Buyer's Advisors and Seller's employees shall
take place only after specific advance written notice to Seller and shall
include, to the extent deemed appropriate by Seller, participation by Seller's
management and its representatives.
8.2 CONDUCT OF BUSINESS
Except for actions taken with the prior written consent of Buyer, from
the date of this Agreement until the Closing Date or the termination of this
Agreement pursuant to Section 13 hereof, Seller shall use the Acquired Assets
and conduct the business of the Product in the ordinary course of business
consistent with past practice.
8.3 COMMERCIALLY REASONABLE EFFORTS
Upon the terms and subject to the conditions of this Agreement, each
party shall use its commercially reasonable efforts to take, or cause to be
taken, all actions, and to do, or cause to be done, and to assist and cooperate
with the other party in doing, all things necessary, proper or advisable to
consummate and make effective as promptly as practicable the transactions
contemplated by this Agreement and the Transaction Documents.
8.4 CONFIDENTIALITY
8.4.1 Each party acknowledges that Confidential Information
of the other party and/or its Affiliates from time to time may be furnished to
the other party and/or its Affiliates in connection with the exercise by the
parties of their respective rights and the fulfillment of their respective
obligations under this Agreement. Each party acknowledges that its access to the
Confidential Information of the other party is being granted solely for the
purpose of exercising its rights and performing its obligations under this
Agreement or the Supply Agreement (the "PERMITTED PURPOSES") and for no other
purposes. Notwithstanding the foregoing, either party may disclose the
Confidential Information of the other party upon reasonable prior written notice
to the other party to the extent required by law, regulation, judicial or
administrative process, including any reporting requirements of the Securities
and Exchange Commission.
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8.4.2 Each party agrees that its use of the Confidential
Information of the other party will be solely for the Permitted Purposes and
that such information will be kept confidential and disclosed to no other
Person, except that the Confidential Information may be disclosed to such
representatives and Affiliates of the first party who need to know such
information in furtherance of effecting the Permitted Purposes, who have been
informed of the confidential nature of such information and who have been
directed, and who shall have agreed, to treat such information confidentially
and to use such information only for the Permitted Purposes.
8.4.3 Each party shall be entitled to obtain, without
posting any bond and without proof of actual damages, a restraining order,
injunction, specific performance or other form of equitable or extraordinary
relief for breach of the provisions of this Section 8.4 by the other party, in
addition to all other remedies available at law or in equity. The parties
further agree that no failure or delay by a party in exercising any right, power
or privilege under this Section 8.4.3 will operate as a waiver thereof, nor will
any single or partial exercise preclude any other or further exercise of any
right, power or privilege.
8.4.4 The parties hereby agree that as of the date hereof,
the Confidentiality Agreement shall be superceded in its entirety by the
provisions of this Section 8.4 and shall be of no further force or effect;
provided, that, any information that was provided by one party to the other
party during the term of the Confidentiality Agreement and was "Confidential
Information" (as defined therein) for purposes thereof shall (subject to the
second sentence of the definition of "Confidential Information" in this
Agreement) be deemed to be "Confidential Information" hereunder and subject to
the provisions of this Section 8.4.
8.4.5 The provisions of this Section 8.4 shall survive any
termination or expiration of this Agreement, in whole or in part.
8.5 NON-COMPETITION
Seller recognizes that the covenants of Seller contained in this
Section 8.5 are part of the bargained-for consideration associated with the
transactions contemplated by this Agreement. On and after the Closing Date,
Seller shall not manufacture or sell, or license any other Person to manufacture
or sell, the Product or any other product developed by Seller that contains
cyanocobalamin as an active ingredient formulated for intranasal delivery. In no
event shall the foregoing sentence prohibit (i) any acquisition or subsequent
operation (A) by Seller of another Person whose business is engaged in the
manufacture or sale of the Product; or (B) of Seller by another Person whose
business is engaged in the manufacture or sale of the Product; (ii) any activity
that Seller is required to or may engage in pursuant to this Agreement or any
other Transaction Document; or (iii) Seller, from the manufacture, sale or
license to any other Person to manufacture or sell, a product that contains
cyanocobalamin as an inactive or inert ingredient (including as a carrier).
8.6 NON-SOLICITATION
During the period commencing on the date hereof and continuing for
twelve (12) months thereafter without the prior written consent of Seller, Buyer
shall not, and shall cause its
- 19 -
Affiliates not to, directly or indirectly, attempt or endeavor to solicit or
entice away any former, current or future director, officer, partner, principal,
employee, agent, representative or consultant of Seller or its Affiliates (a
"SELLER EMPLOYEE"), without the prior written consent of Seller, nor shall
Buyer, directly or indirectly, employ or aid or assist in or procure the
employment by any other Person of any Seller Employee during such period,
without the prior written consent of Seller. This Section 8.6 shall not prohibit
recruiting or general solicitations through the media that is not directed
specifically at the Seller Employees.
8.7 PATENT AND TRADEMARK ENFORCEMENT AND PROSECUTION
8.7.1 On and after the Closing Date, Seller shall continue
to have the sole right and responsibility to prosecute the Spray Patent
Applications. Seller shall use commercially reasonable efforts to prosecute the
Spray Patent Applications at Seller's sole expense. Seller may abandon efforts
to prosecute the Spray Patent Applications if Seller reasonably determines that
such efforts are no longer commercially useful or cost effective.
8.7.2 Seller shall promptly provide Buyer with copies of
all correspondence with the USPTO concerning prosecution of the Spray Patent
Applications and otherwise inform Buyer of any developments relating to such
prosecution efforts. Seller will promptly respond to Buyer's reasonable requests
for information regarding such prosecution efforts.
8.7.3 Buyer and Seller shall each promptly notify the other
in writing of any alleged or threatened infringement of any third-party rights
that appears likely to adversely affect the development or commercialization of
the Product, or if either party, or any of its Affiliates, is individually named
as a defendant in a Proceeding by a third party for infringement because of the
manufacture, use, marketing, importation, offer to sell, or sale of a Product.
In the event such action or proceeding is brought against Buyer or Seller or
their respective Affiliates, the party so sued may elect to defend such suit
provided that it does so at its own expense (subject to such indemnification as
may be available under Section 11.2 or 11.3 hereof), and shall fully consult
with the other party in respect of such defense. If such party shall decline to
defend such action or proceeding, it shall promptly notify the other party of
this decision. The other party shall, in any event, have the right, but not the
obligation, to join or intervene in the defense of such action or proceeding at
its own expense.
8.7.4 Each party shall promptly notify the other in writing
of any alleged third party infringement of or challenge (including any claim of
invalidity or interference, opposition or similar proceeding) with respect to
any rights relating to the Spray Patent Applications, the Spray Patents or the
Marks.
8.8 NDA PROSECUTION
On and after the Closing Date, Seller shall use its commercially
reasonable efforts to secure FDA approval of the NDA at Seller's sole expense.
Prior to securing FDA approval of the NDA, Seller shall promptly (i) provide
Buyer with copies of all correspondence concerning the NDA and otherwise inform
Buyer of any developments relating to such efforts, including reporting any
adverse events and complaints by physicians relating to the Product in spray
form, and (ii) respond to Buyer's reasonable requests for information regarding
such prosecution
- 20 -
efforts. Seller may abandon such efforts to pursue the NDA if Seller reasonably
determines that such efforts are no longer commercially useful or cost
effective.
8.9 GEL NDA MAINTENANCE
On and after the Closing Date, Buyer shall timely comply with all FDA
regulations concerning the Gel NDA at Buyer's sole expense. Prior to FDA
approval of the NDA (or Seller's earlier abandonment of its pursuit of the NDA),
Buyer shall promptly provide Seller with copies of all correspondence concerning
the Gel NDA and the Gel IND and otherwise inform Seller of any developments
relating to such efforts, including reporting any adverse events and complaints
by physicians relating to the Product in gel form. Subsequent to FDA approval of
the NDA and Seller's transfer of the approved NDA to Buyer pursuant to Section
2.6.1, Buyer will continue to make available to Seller information that Seller
may reasonably request in connection with its prosecution of the Spray Patent
Applications, unless such prosecution has been abandoned or transferred to Buyer
pursuant to Section 2.6.2.
8.10 PRODUCT MAINTENANCE
On and after the Closing Date, except as otherwise provided herein,
Buyer shall be solely responsible for handling all adverse events reporting,
recalls, customer complaints, field alerts and all other maintenance relating
to, or concerning, the Product or the Assigned Property.
8.11 PRODUCT MODIFICATION
Seller shall not make any material modifications to the Product or the
manufacturing process for the Product without the prior written consent of
Buyer, which consent shall not be unreasonably withheld.
8.12 CUSTOMER INFORMATION
On and after the Closing Date, Seller shall provide Buyer with (i)
copies of relevant customer lists, customer sales data and copies of customer
sales contracts to the extent the same are related to the Product in a manner
intended to preserve continuity in the marketplace for the Product; and (ii)
lists of patient special interest groups by whom use of the Product would be
appropriate or necessary.
8.13 TERMINATION OF CORD AGREEMENT
At or prior to the Closing, Seller shall terminate the Cord Agreement,
except as Buyer and Seller shall have otherwise agreed in writing.
8.14 NATIONAL DRUG CODE
Unless otherwise agreed to in writing by Buyer and Seller, no later
than five (5) days following Closing, Buyer shall assign and publish a new NDC
for the Product currently marketed by Seller under the Gel NDA that uniquely
identifies the Product as a product of Buyer directly associated with the FDA's
unique assigned labeler code of Buyer.
- 21 -
8.15 MAINTENANCE OF CROSS-LICENSES
On and after the Closing Date, Buyer shall ensure that Seller retain
all rights and licenses retained by Seller (i) under Section 5.2.1 hereof until
the expiration or earlier termination of the Supply Agreement and (ii) under
Section 5.2.2 hereof until the later to occur of (A) FDA approval of the NDA (or
Seller's earlier abandonment of its pursuit of the NDA) and (B) the issuance by
the USPTO of any patent claiming priority from any of the Spray Patent
Applications with any independent claim covering any formulation which treats
any indication in the approved NDA (or Seller's earlier abandonment of its
prosecution of the Spray Patent Applications).
8.16 FURTHER ASSURANCES
Upon the terms and subject to the conditions of this Agreement, after
the Closing, each party agrees to use its commercially reasonable efforts to
take, or cause to be taken, all actions, and to do, or cause to be done, and to
assist and cooperate with the other party in doing, all things necessary, proper
or advisable to give full effect to the transactions contemplated by this
Agreement and the Transaction Documents.
9. CONDITIONS PRECEDENT TO BUYER'S OBLIGATIONS
Buyer's obligations to consummate the transactions contemplated hereby
shall be subject to the satisfaction at or prior to the Closing Date of all of
the following conditions, each of which is for the sole benefit of Buyer and may
be waived only in writing by Buyer:
9.1 NO CLAIM, ORDER OR PROCEEDING
As of the Closing Date, there shall not be any Claim, Order or
Proceeding threatened, pending or made that questions or challenges the
lawfulness of the transactions contemplated by this Agreement or the Transaction
Documents under any Law or seeks to delay, restrain or prevent such
transactions.
9.2 REPRESENTATIONS, WARRANTIES AND COVENANTS
9.2.1 The representations and warranties made by Seller in
this Agreement shall be accurate and complete in all material respects on and as
of the Closing Date with the same force and effect as though made on and as of
the Closing Date, except to the extent any such representation or warranty
expressly speaks of a particular date, in which case it shall be true and
correct as of such date.
9.2.2 Seller shall have performed and complied in all
material respects with the covenants and obligations required by this Agreement
to be performed and complied with by Seller on or prior to the Closing Date.
9.3 SECRETARY'S CERTIFICATE
Buyer shall have received a certificate, in form and substance
reasonably satisfactory to Buyer, signed by the Secretary of Seller, dated the
Closing Date, certifying as to the following:
- 22 -
(i) the Certificate of Incorporation of Seller as in effect on the date thereof;
(ii) the By-Laws of Seller as in effect on the date thereof; (iii) the
resolutions (or written consent) of Seller's board of directors authorizing and
approving this Agreement, the Transaction Documents and the transactions
contemplated hereby and thereby; and (iv) the signatures and incumbency of the
Persons signing this Agreement and the Transaction Documents on behalf of
Seller.
9.4 BILL OF SALE
Buyer shall have received the Bill of Sale duly executed and delivered
by Seller.
9.5 ASSIGNMENT AND ASSUMPTION AGREEMENT
Buyer shall have received the Assignment and Assumption Agreement duly
executed and delivered by Seller.
9.6 SUPPLY AGREEMENT
Buyer shall have received the Supply Agreement duly executed and
delivered by Seller.
9.7 TAXES
All Taxes and other assessments applicable to the Acquired Assets that
are due and owing as of the Closing Date shall have been paid, except for Taxes
and assessments to be apportioned between the parties as of the Closing pursuant
to Section 12.3 or paid pursuant to Section 12.1.
9.8 LISTING AND ACCOUNT OF ASSIGNED PROPERTY
Buyer shall have received from Seller an exact listing and account of
the Assigned Property transferred by Seller to Buyer under this Agreement.
9.9 OTHER DOCUMENTS
Buyer shall have received all other instruments, documents and
certificates as may be reasonably requested by Buyer, each in form and substance
reasonably satisfactory to Buyer, that are necessary for the consummation at the
Closing of the transactions contemplated by the Transaction Documents.
10. CONDITIONS PRECEDENT TO SELLER'S OBLIGATIONS
Seller's obligations to consummate the transactions contemplated hereby
shall be subject to the satisfaction at or prior to the Closing of all of the
following conditions, each of which is for the sole benefit of Seller and may be
waived only in writing by Seller:
10.1 NO CLAIM, ORDER OR PROCEEDING
As of the Closing Date, there shall not be any Claim, Order or
Proceeding threatened, pending or made that questions or challenges the
lawfulness of the transactions contemplated by
- 23 -
this Agreement or the Transaction Documents under any Law or seeks to delay,
restrain or prevent such transactions.
10.2 REPRESENTATIONS, WARRANTIES AND COVENANTS
10.2.1 The representations and warranties made by Buyer in
this Agreement shall be accurate and complete in all material respects on and as
of the Closing Date with the same force and effect as though made on and as of
the Closing Date, except to the extent any such representation or warranty
expressly speaks of a particular date, in which case it shall be true and
correct as of such date.
10.2.2 Buyer shall have performed and complied in all
material respects with the covenants and obligations required by this Agreement
to be performed and complied with by Buyer on or prior to the Closing Date.
10.3 SECRETARY'S CERTIFICATE
Seller shall have received a certificate, in form and substance
reasonably satisfactory to Seller, signed by the Secretary or Assistant
Secretary of Buyer, dated the Closing Date, certifying as to the following: (i)
the articles of incorporation of Buyer as in effect on the date thereof; (ii)
the by-laws of Buyer as in effect on the date thereof; (iii) the resolutions (or
written consent) of Buyer's board of directors authorizing and approving this
Agreement, the Transaction Documents and the transactions contemplated hereby
and thereby; and (iv) the signatures and incumbency of the Persons signing this
Agreement and the Transaction Documents on behalf of Buyer.
10.4 ASSIGNMENT AND ASSUMPTION AGREEMENT
Seller shall have received the Assignment and Assumption Agreement duly
executed and delivered by Buyer.
10.5 SECURITY AGREEMENTS
Seller shall have received the Security Agreements duly executed and
delivered by Buyer.
10.6 SUPPLY AGREEMENT
Seller shall have received the Supply Agreement duly executed and
delivered by Buyer.
10.7 OTHER DOCUMENTS
Seller shall have received all other instruments, documents and
certificates as may be reasonably requested by Seller, each in form and
substance reasonably satisfactory to Seller, that are necessary for the
consummation at the Closing of the transactions contemplated by the Transaction
Documents.
- 24 -
11. SURVIVAL; INDEMNIFICATION
11.1 SURVIVAL
The representations, warranties, covenants and agreements of the
parties hereto contained in this Agreement shall survive the Closing for a
period of eighteen (18) months; provided, that, (i) the representations and
warranties in Sections 6.2.2, 6.4, 6.6 and 7.2.2 and the agreements in Section
2, Section 3, this Section 11 and Section 12 shall survive the Closing
indefinitely; and (ii) each of the covenants and agreements in Section 8 shall
survive for the period of time stated in such covenant or agreement or, if no
such period is specified, indefinitely. Notwithstanding the time limits set
forth above, any covenant, agreement, representation or warranty in respect of
which indemnity may be sought under Sections 11.2 or 11.3 shall survive (but
only as to that portion of any such covenant, agreement, representation or
warranty to which such indemnity claim relates) the time at which it would
otherwise terminate pursuant to the preceding sentence if notice of the
inaccuracy or breach thereof giving rise to such right to indemnity shall have
been given to the party against whom such indemnity may be sought prior to such
time and such notice was delivered in accordance with the procedures described
in Section 11.4 below.
11.2 INDEMNIFICATION BY SELLER
Subject to the terms of this Section 11, Seller hereby indemnifies
Buyer and its successors, assigns, directors, officers, stockholders, employees,
Affiliates, agents and representatives (collectively, the "BUYER INDEMNIFIED
PARTIES") from and against any and all costs and expenses (including, without
limitation, reasonable attorneys' fees and expenses and reasonable expenses of
investigation in connection with any action, suit or proceeding), judgments,
fines, losses, claims, damages, liabilities and amounts paid in settlement
(collectively, "LOSSES") imposed on, incurred or suffered by or asserted against
any Buyer Indemnified Party, as a result of, arising out of or in connection
with (i) Seller's manufacture, ownership, use or possession of the Acquired
Assets before the Closing Date; (ii) the operations of Seller at any time before
or after the Closing; or (iii) any breach of warranty, covenant or agreement
made or to be performed by Seller pursuant to this Agreement.
11.3 INDEMNIFICATION BY BUYER
Subject to the terms of this Section 11, Buyer agrees to indemnify,
defend and hold harmless Seller and its successors, assigns, directors,
officers, stockholders, employees, Affiliates, agents and representatives
(collectively, the "SELLER INDEMNIFIED PARTIES") from and against any and all
Losses imposed on, incurred or suffered by or asserted against any Seller
Indemnified Party, as a result of, arising out of or in connection with (i) the
Assumed Liabilities; (ii) Buyer's ownership, use or possession of the Acquired
Assets after the Closing Date; (iii) the operations of Buyer at any time before
or after the Closing; or (iv) any breach of warranty, covenant or agreement made
or to be performed by Buyer pursuant to this Agreement.
11.4 PROCEDURES; NO WAIVER; EXCLUSIVITY
Any Party seeking indemnification pursuant to this Section 11.4 (the
"INDEMNIFIED PARTY") shall promptly notify the other Party (the "INDEMNIFYING
PARTY") of the claim as to which indemnification is sought, shall afford the
Indemnifying Party, at the Indemnifying Party's
- 25 -
sole expense, the opportunity to defend or settle the claim (in which case the
Indemnifying Party shall not be responsible for the attorneys' fees of the
Indemnified Party with respect such claim) and shall cooperate to the extent
reasonably requested by the Indemnifying Party in the investigation and defense
of such claim; provided, however, that any settlement of any such claim that
would adversely affect the rights of the Indemnified Party shall require the
written approval of such Indemnified Party, which approval shall not be
unreasonably withheld; and provided, further that an Indemnified Party shall not
settle any such claim without the written approval of the Indemnifying Party,
which approval shall not be unreasonably withheld.
11.5 OFFSET; LIMITATIONS
Any Losses for which Seller may finally be determined to be liable to
Buyer under this Section 11 shall be (i) first, offset against the amount of the
Deferred Non-Contingent Payment due December 31, 2003 to the extent not yet paid
(whether or not then due); (ii) second, to the extent such Losses exceed the
amount of such Deferred Non-Contingent Payment, offset against the amount of the
Deferred Non-Contingent Payment due September 30, 2003 to the extent not yet
paid (whether or not then due); and (iii) finally, to the extent the amount of
such Losses exceed the unpaid amount of both Deferred Non-Contingent Payments,
paid by Seller to Buyer. In no event shall Seller's cumulative and aggregate
obligations under this Agreement exceed the lesser of (i) the sum of (x) the
Initial Payment; and (y) the amount of Deferred Non-Contingent Payments actually
received by Seller under Section 3.3 hereof and (ii) $14,000,000.
Notwithstanding the foregoing, in no event shall this Section 11.5 apply to any
breach of Section 8.5 hereof.
11.6 SOLE AND EXCLUSIVE REMEDIES AND LIABILITY
Except for any breach of Section 8.4 hereof, for which the
non-breaching party shall be entitled to seek equitable relief, including
injunction and specific performance, as a remedy for such breach, the
indemnification obligations under this Section 11 shall constitute the sole and
exclusive remedies of each party and the sole and exclusive liability of each
party with respect to any Loss, suit, action, claim or proceeding arising out of
or relating to this Agreement or the transactions contemplated hereby
(including, without limitation, negligence) or otherwise (except with respect to
Buyer's obligation to pay the Purchase Price).
12. TAXES AND COSTS; APPORTIONMENTS
12.1 TRANSFER TAXES
Buyer shall be responsible for the payment of all transfer, sales and
use and documentary Taxes, filing and recordation fees and similar charges
relating to the sale or transfer of the Acquired Assets hereunder.
12.2 TRANSACTION COSTS
Each party shall be responsible for its own costs and expenses incurred
in connection with the preparation, negotiation and delivery of this Agreement
and the other Transaction Documents, including but not limited to attorneys' and
accountants' fees and expenses.
- 26 -
12.3 APPORTIONMENTS; REFUNDS
Any and all Taxes, assessments, lease rentals, utilities, and other
charges applicable to the Acquired Assets will be pro-rated to the Closing Date,
and such Taxes and other charges shall be allocated between the parties by
adjustment at the Closing, or as soon thereafter as the parties may agree, in
accordance with the principle that Seller shall be responsible for periods or
portions thereof ending on or before the Closing Date, and Buyer shall be
responsible for periods or portions thereof beginning after the Closing Date.
All such Taxes shall be allocated on the basis of the fiscal year of the
jurisdiction in question. Seller shall be entitled to any refunds of Taxes or
other charges paid by Seller with respect to the Acquired Assets for periods or
portions thereof ending on or prior to the Closing Date, and Buyer shall be
entitled to all other refunds for Taxes or other charges with respect to the
Acquired Assets.
13. TERMINATION
13.1 TERMINATION
This Agreement may be terminated any time prior to the Closing Date:
(a) by the mutual written consent of Buyer and
Seller;
(b) by Seller, on the one hand, or Buyer, on the
other hand, if all the conditions for Closing set forth in Sections 9 and 10
hereof, as the case may be, shall not have been satisfied or waived on or before
June 30, 2003, other than as a result of a breach of this Agreement by the
terminating party;
(c) by Seller if Buyer has breached in any
material respect any representation, warranty, covenant or agreement contained
in this Agreement, which breach has not been cured on or prior to ten (10) days
following delivery of written notice of such breach by Seller to Buyer;
(d) by Buyer if Seller has breached in any
material respect any representation, warranty, covenant or agreement contained
in this Agreement, which breach has not been cured on or prior to ten (10) days
following delivery of written notice of such breach by Buyer to Seller; or
(e) by Seller or Buyer, if a permanent
injunction or other legal requirement by any court, arbitral tribunal or
Governmental Entity which would make it illegal or otherwise restrain or
prohibit the consummation of this Agreement shall have been issued and shall
have become final and nonappealable.
13.2 NOTICE OF TERMINATION
Any termination of this Agreement under Section 13.1 hereof will be
effective by the delivery of written notice of the terminating party to the
other party hereto.
- 27 -
13.3 EFFECT OF TERMINATION
In the event of any termination of this Agreement as provided in this
Section 13, this Agreement shall forthwith become void and shall be of no
further force and effect, without any liability on the part of any party hereto
or its Affiliates, directors, officers, stockholders, employees, agents and
representatives, solely in respect of such termination; provided, that, the
provisions of Sections 8.4, 8.5, 12.2, 14.1, 14.4, 14.10 and this Section 13.3
shall remain in full force and effect and survive any termination of this
Agreement.
14. MISCELLANEOUS
14.1 PUBLIC ANNOUNCEMENTS
Neither party shall, nor may it permit its Affiliates to, make any
public announcement or publish any press release in regard to the transactions
contemplated by this Agreement and the Transaction Documents without the other
party's prior written consent, which consent shall not be unreasonably withheld,
except as may be required by Law, in which case the parties shall use reasonable
efforts to coordinate with each other with respect to the timing, form and
content of such required disclosures. Notwithstanding the foregoing, each party
shall give the other party no less than two (2) business days to review and
comment on any proposed public announcement or press release.
14.2 SEVERABILITY
If any trier of fact determines that any part or provision of this
Agreement is invalid or unenforceable, the remainder of this Agreement shall not
be affected thereby and shall be given full force and effect and remain binding
upon the parties. Furthermore, the trier of fact shall have the power to replace
the invalid or unenforceable part or provision with a provision that
accomplishes, to the extent possible, the original intent of such part or
provision in a valid and enforceable manner.
14.3 MODIFICATION AND WAIVER
This Agreement may not be amended or modified in any manner except by
an instrument in writing signed by all of the parties. The failure of any party
to enforce at any time any of the provisions of this Agreement shall in no way
be construed to be a waiver of any such provision, or in any way affect the
right of such party thereafter to enforce each and every such provision. No
waiver of any breach of this Agreement shall be deemed to be a waiver of any
other or subsequent breach.
14.4 NOTICES
All notices and other communications required or permitted to be given
under this Agreement shall be in writing and shall be sent by facsimile
transmission, or mailed postage prepaid by first-class certified mail, or
delivered by a nationally recognized express courier service, or hand-delivered,
addressed as follows:
if to Buyer: Questcor Pharmaceuticals, Inc.
- 28 -
3260 Whipple Road
Union City, California 94587
Attention: Chief Executive Officer
Facsimile: (510) 500-0715
with a copy that shall not Latham & Watkins LLP
constitute notice to: 701 B Street, Suite 2100
San Diego, CA 92101
Attention: David A. Hahn, Esq.
Facsimile: (619) 696-7419
if to Seller: Nastech Pharmaceutical Company, Inc.
3450 Monte Villa Parkway
Bothell, Washington 98021
Attention: Chief Executive Officer
Facsimile: (425) 908-3650
with a copy that shall not Kramer Levin Naftalis & Frankel LLP
constitute notice to: 919 Third Avenue
New York, New York 10022
Attention: Richard Marlin, Esq.
Facsimile: (212) 715-8000
Any party may change the Persons or addresses to which any notices or other
communications to it should be addressed by notifying the other parties as
provided above. Any notice or other communication, if addressed and sent, mailed
or delivered as provided above, shall be deemed given or received three days
after the date of mailing as indicated on the certified mail receipt, or on the
next business day if delivered to an express courier service, or on the date of
delivery or transmission if hand-delivered or sent by facsimile transmission.
14.5 ASSIGNMENT
Neither party may assign any of its rights or obligations hereunder
without the prior written consent of the other party, which consent shall not be
unreasonably withheld. Notwithstanding the foregoing sentence, either party may
assign or transfer this Agreement without the other party's consent to a third
party that acquires all or substantially all of the transferring party's assets
or business; provided, however, that in no event shall Buyer assign or transfer
this Agreement to any Person a material portion of whose business is engaged in
the research and development or manufacturing of intranasally delivered
products. This Agreement shall be binding upon and inure to the benefit of the
parties and their respective permitted successors and assigns.
- 29 -
14.6 CAPTIONS
The captions and headings used in this Agreement have been inserted for
convenience of reference only and shall not be considered part of this Agreement
or be used in the interpretation hereof.
14.7 ENTIRE AGREEMENT
This Agreement, together with the Confidentiality Agreement,
constitutes the entire agreement and understanding among the parties with
respect to its subject matter and supersedes all prior agreements,
understandings, negotiations, representations and statements, whether oral,
written, implied or expressed, relating to such subject matter.
14.8 NO THIRD-PARTY RIGHTS
Nothing in this Agreement is intended, nor shall be construed, to
confer upon any Person other than Buyer, Seller (and, only to the extent
expressly provided herein, their respective Affiliates and representatives) any
right or remedy under or by reason of this Agreement.
14.9 COUNTERPARTS
This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original, but all of which shall constitute one
agreement.
14.10 GOVERNING LAW
This Agreement shall be governed by and construed in accordance with
the internal laws of California as though made and to be fully performed in that
State.
14.11 ARBITRATION
Any dispute, controversy or claim arising out of or in connection with
this Agreement shall be determined and settled by arbitration in Bothell,
Washington, pursuant to the Rules of Arbitration then in effect of the American
Arbitration Association. Any award rendered shall be final and conclusive upon
the parties and a judgment thereon may be entered in a court having competent
jurisdiction. Any arbitration hereunder shall be (i) submitted to an arbitration
tribunal comprised of three (3) independent members knowledgeable in the
pharmaceutical industry, one of whom shall be selected by the other two
arbitrators; (ii) allow for the parties to request discovery pursuant to the
rules then in effect under the Federal Rules of Civil Procedure for a period not
to exceed 90 days; and (iii) require the award to be accompanied by findings of
fact and a statement of reasons for the decision. Each party shall bear its own
costs and expenses, including attorney's fees incurred in any dispute, which is
determined and/or settled by arbitration pursuant to this Section 14.11. Except
where clearly prevent by the area in dispute, both parties agree to continue
performing their respective obligations under this Agreement while the dispute
is being resolved. Arbitration shall not prevent any party from seeking
injunctive relief where such remedy is an appropriate form of remedy under the
circumstances.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]
- 30 -
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
SELLER:
NASTECH PHARMACEUTICAL
COMPANY, INC.
By __________________________________
Name: Steven C. Quay, M.D., Ph.D.
Title: President & CEO
BUYER:
QUESTCOR PHARMACEUTICALS, INC.
By __________________________________
Title:
- 31 -
SCHEDULE 2.1.1
ASSIGNED PROPERTY
All supply of the Product in gel form, owned by Seller and located in the
warehouses of Seller or any other Person, identified by the lot number 3002 and
the Seller's NDC code 57459-1002-1, with shelf life expiration dates on or after
February 15, 2005.
The New Drug Application, No. 19-722, relating to the Product in gel form, and
approved by the FDA on November 5, 1996.
The Investigational New Drug Application, No. 25,696, relating to the Product in
gel form, and received by the FDA on January 22, 1985.
SCHEDULE 2.1.2
INTELLECTUAL PROPERTY
Patents
1. U.S. Patent No. 4,724,231 "Nasal Compositions Containing Vitamin B12"
issued February 9, 1988.
2. E.U. Patent No. EP0216917B1 "Nasal Compositions Containing Vitamin
B12."
3. E.U. Patent No. EP0218679B1 "Aerosol Compositions for Nasal Delivery of
Vitamin B12."
WWKMN REF. NO.;
(TTC REF. NO.);
COUNTRY; APPL'N NO. PATENT NO.
CLIENT REF. NO.; TITLE FILING DATE ISSUE DATE
NPCI-0008 Aerosol Compositions for Nasal Delivery of 506,798 1,317,881
Canada Vitamin B12 04/16/86 05/18/93
(20833-000700CA)
719-21CANADA
NPCI-0010 Aerosol Compositions for Nasal Delivery of 86-902640.1 0218679
Europe Vitamin B12 04/02/86 12/11/91
(20833-000700EP)
719-21PCT/EPO
NPCI-0011 Aerosol Compositions for Nasal Delivery of 86-902640.1 0218679
Belgium Vitamin B12 04/02/86 12/11/91
(20833-000700BE)
NPCI-0012 Aerosol Compositions for Nasal Delivery of 86-902640.1 0218679
France Vitamin B12 04/02/86 12/11/91
(20833-000700FR)
NPCI-0013 Aerosol Compositions for Nasal Delivery of 86-902640.1 0218679
Great Britain Vitamin B12 04/02/86 12/11/91
(20833-000700GB)
NPCI-0014 Aerosol Compositions for Nasal Delivery of 86-902640.1 P3682862.9
Denmark Vitamin B12 04/02/86 12/11/91
(20833-000700DE)
NPCI-0015 Aerosol Compositions for Nasal Delivery of 86-902640.1 0218679
Italy Vitamin B12 04/02/86 12/11/91
(20833-000700IT)
NPCI-0016 Aerosol Compositions for Nasal Delivery of 86-902640.1 0218679
Luxembourg Vitamin B12 04/02/86 12/11/91
(20833-000700LU)
WWKMN REF. NO.;
(TTC REF. NO.);
COUNTRY; APPL'N NO. PATENT NO.
CLIENT REF. NO.; TITLE FILING DATE ISSUE DATE
NPCI-0017 Aerosol Compositions for Nasal Delivery of 86-902640.1 0218679
Netherlands Vitamin B12 04/02/86 12/11/91
(20833-000700NL)
NPCI-0018 Aerosol Compositions for Nasal Delivery of 86-902640.1 0218679
Sweden Vitamin B12 04/02/86 12/11/91
(20833-000700SE)
NPCI-0019 Aerosol Compositions for Nasal Delivery of 86-902640.1 0218679
Switzerland Vitamin B12 04/02/86 12/11/91
(20833-000700CH)
NPCI-0034 Nasal Compositions Containing Vitamin B12 06/848,690 4,724,231
US 04/08/86 02/09/88
(20833-000610US)
719-16CIP
NPCI-0035 Nasal Compositions Containing Vitamin B12 PCT/US86/00793
PCT 04/15/86
(20833-000610PC)
719-16CIP/PCT
NPCI-0036 Nasal Compositions Containing Vitamin B12 57757/86 584703
Australia 04/15/86 10/20/89
(20833-000610AU)
NPCI-0037 Nasal Compositions Containing Vitamin B12 506,799 1,300,014
Canada 04/26/86 05/05/92
(20833-000610CA)
NPCI-0038 Nasal Compositions Containing Vitamin B12 86902732.6 0216917
Europe 04/15/86 07/04/90
(20833-000610EP)
719-16CIP/PCT/EPO
NPCI-0039 Nasal Compositions Containing Vitamin B12 86902732.6 0216917
Belgium 04/15/86 07/04/90
(20833-000610BE)
NPCI-0040 Nasal Compositions Containing Vitamin B12 6038/86
Denmark EP86902732.6
(20833-000610DK) 04/15/86
NPCI-0041 Nasal Compositions Containing Vitamin B12 86902732.6 0216917
France 04/15/86 07/04/90
(20833-000610FR)
NPCI-0042 Nasal Compositions Containing Vitamin B12 86902732.6 0216917
Great Britain 04/15/86 07/04/90
(20833-000610GB
WWKMN REF. NO.;
(TTC REF. NO.);
COUNTRY; APPL'N NO. PATENT NO.
CLIENT REF. NO.; TITLE FILING DATE ISSUE DATE
NPCI-0043 Nasal Compositions Containing Vitamin B12 86902732.6 0216917
Germany 04/15/86 07/04/90
(20833-000610DE) (German P/N
NPCI-0044 Nasal Compositions Containing Vitamin B12 974/86 58533
Ireland 04/15/86 09/27/93
(20833-000610IE)
NPCI-0045 Nasal Compositions Containing Vitamin B12 86902732.6 0216917
Italy 04/15/86 07/04/90
(20833-000610IT)
NPCI-0046 Nasal Compositions Containing Vitamin B12 86902732.6 0216917
Luxembourg 04/15/86 07/04/90
(20833-000610LU
NPCI-0047 Nasal Compositions Containing Vitamin B12 86902732.6 0216917
Netherlands 04/15/86 07/04/90
(20833-000610NL)
NPCI-0048 Nasal Compositions Containing Vitamin B12 553,999 553,999
Spain 04/15/86 04/20/87
(20833-000610ES)
NPCI-0049 Nasal Compositions Containing Vitamin B12 86902732.6 0216917
Sweden 04/15/86 07/04/90
(20833-000610SE)
NPCI-0050 Nasal Compositions Containing Vitamin B12 86902732.6 0216917
Switzerland 04/15/86 07/04/90
(20833-000610CH)
NPCI-0051 Nasal Compositions Containing Vitamin B12 2345/86 196124
Hungary 04/15/86 06/16/88
(20833-000610HU)
NPCI-0052 Nasal Compositions Containing Vitamin B12 502336/86 1945666
Japan 04/15/86 06/23/95
(20833-000610JP)
NPCI-0053 Nasal Compositions Containing Vitamin B12 865010 174.182
Norway 04/15/86 03/30/94
(20833-000610NO)
NPCI-0054 Nasal Compositions Containing Vitamin B12 86/2845 86/2845
South Africa 04/16/86 10/29/86
(20833-000610ZA)
NPCI-0055 Nasal Compositions Containing Vitamin B12 75102030 NI-029728
Taiwan 05/06/86 12/10/88
(20833-000610TW)
Trademarks
Filing
Case No. Mark Country Appl. No. Date Reg. No. Status
-------- ---- ------- --------- ---- -------- ------
NPCI-0279 NASCOBAL U.S. 194046 11/6/1996 2157683 REGISTERED
NPCI-0282 NASCOBAL Australia 733493 4/30/1997 733493 REGISTERED
NPCI-0284 NASCOBAL Switzerland 338597 4/30/1997 446146 REGISTERED
NPCI-0285 NASCOBAL Community Trademark CTM 528455 5/2/1997 528455 REGISTERED
NPCI-0286 NASCOBAL Hungary M9701528 4/30/1997 150653 REGISTERED
NPCI-0287 NASCOBAL Japan 9-113198 5/2/1997 4190179 REGISTERED
NPCI-0288 NASCOBAL Norway 97.3451 4/30/1997 187.774 REGISTERED
NPCI-0289 NASCOBAL Taiwan 8622191 5/5/1997 798240 REGISTERED
NPCI-0290 NASCOBAL South Africa 97/06437 4/30/1997 97/06437 REGISTERED
SCHEDULE 2.1.3
ASSIGNED CONTRACTS
1. Detailing Agreement, dated as of April 20, 2003, by and between Nastech
Pharmaceutical Company, Inc. and Vanguard Pharma.
2. Physician Program Agreement, dated as of May 22, 2003, by and between
Nastech Pharmaceutical Company, Inc. and Deborah Woods and Associates.
SCHEDULE 2.1.4
STUDIES AND RECORDS
1. Gastroenterologist and B12 Patient Study, July 2002.
2. Gastroenterologist Market Research, May 2003.
3. NASCOBAL(R)promotional materials.
4. Where feasible, NASCOBAL(R)website information, materials, images and
HTML programming language.
SCHEDULE 2.1.5
REGULATORY APPROVALS
All regulatory approvals permitting the sale of the Product in the United
States, Sweden and Israel.
The right to file for approval of the Product in gel form in countries where the
Product in gel form has not obtained regulatory approvals as of the date of this
Agreement.
SCHEDULE 2.1.6
CLINICAL DATA
1. Relative Bioavailability Study of Vitamin B12 Formulations (Single
Dose, Three-Way Crossover); Protocol 160-01; Study Completion 1985
2. Relative Bioavailability Study of Five Vitamin B12 Formulations (Single
Dose, No Crossover); Protocol 160-02; Study Completion 1985
3. Relative Bioavailability Study of Four Vitamin B12 Formulations (Single
Dose, No Crossover); Protocol 160-04; Study Completion 1985
4. Relative Bioavailability Study of Vitamin B12 Formulations (Single
Dose, No Crossover); Protocol 160-05; Study Completion 1985
5. Relative Bioavailability Study of Vitamin B12 Formulations (Single
Dose, No Crossover); Protocol 160-06; Study Completion 1985
6. Bioavailability of Intranasal Cyanocobalamin Administered as
Maintenance or Initial Therapy in Vitamin B12 Deficiency Anemia; Study
Completion 1987
7. A Clinical Evaluation of the Effectiveness and Safety of Cyanocobalamin
Nasal Gel in the Maintenance of Patients with a Documented History of
Pernicious Anemia Successfully Maintained Previously by the
Intramuscular Administration of Vitamin B12; Protocol A; Study
Completion 1987
8. A Clinical Evaluation of the Effectiveness and Safety of Cyanocobalamin
Nasal Gel in the Treatment of Patients with Newly-Diagnosed Pernicious
Anemia who had never Previously Received Vitamin B12 Treatment;
Protocol B; Study Completion 1987
9. Comparative, Crossover Bioavailability Study in Pernicious Anemia
Patients of 500 mcg Cyanocobalamin Nasal Gel and 100 mcg Cyanocobalamin
Injectable Solution. Protocol Number 91001; Study Completion 1993
10. Nasal Applicator Tube Dose Delivery Study, Study Completion 1994
11. The Pharmacokinetic Profile of Intramuscular and Repeated Intranasal
Cyanocobalamin in Vitamin B12 Deficiency Anemia Patients, Protocol
Number C95-001; Study Completion 1996.
SCHEDULE 2.1.7
VALIDATION LOTS
None.
SCHEDULE 2.2
EXCLUDED ASSETS
None.
EXHIBIT 2.6.6
P A T E N T A S S I G N M E N T
WHEREAS, Nastech Pharmaceutical Company, Inc., a Delaware corporation
having its principal place of business located at 3450 Monte Villa Parkway,
Bothell, Washington, (the "ASSIGNOR"), is the owner of all right, title and
interest in and to the United States patents and patent applications recorded in
the United States Patent and Trademark Office and the foreign counterpart
patents and patent applications recorded in the respective jurisdictions in
which said foreign patents are registered or are pending, all of which are
identified in the attached Schedule A, and is the owner of all right, title and
interest in and to the inventions and improvements disclosed in the aforesaid
patents and patent applications (all of the aforesaid patents, patent
applications, inventions and improvements being hereinafter collectively
referred to as the "Patents"); and
WHEREAS, Questcor Pharmaceuticals, Inc., a California corporation
having its principal place of business at 3260 Whipple Road, Union City,
California (hereinafter the "ASSIGNEE"), is desirous of obtaining the entire
right, title and interest in, to and under the Patents;
NOW, THEREFORE, in consideration of the sum of One Dollar ($1.00) and
other good and valuable consideration, the receipt and sufficiency of which
ASSIGNOR does hereby acknowledge, ASSIGNOR does hereby sell, assign, transfer,
set over and convey, unto the ASSIGNEE, ASSIGNEE's successors, legal
representatives and assigns, the ASSIGNOR's entire right, title and interest, in
the United States and throughout the Universe, in and to the Patents, including,
without limitation: (i) all confirmations, divisions, renewals, extensions,
reissues, continuations, continuations-in-part, substitutes, amendments and
modifications (including reexamination amendments), certificates, utility models
and additions as may at any time be applied for or granted with respect to said
Patents; (ii) all rights, titles and interests granted to ASSIGNOR pursuant to
any previously executed assignment agreement between the inventor of each
invention embodied by the Patents and ASSIGNOR or any of ASSIGNOR'S predecessors
in interest; (iii) all rights to petition, sue or otherwise seek and recover
damages, profits and any other remedy (monetary, injunctive, declaratory or
other), in the United States and anywhere throughout the Universe, for any past,
present or future infringement, conversion or misappropriation of, or other
injury, offense, violation, breach of duty or wrong relating to, any of the
Patents or any license, agreement, contract or other matter relating thereto;
and (iv) the ASSIGNOR's entire right, title, interest, and privileges and
immunities, under any treaty or convention relating to any of the Patents,
including, without limitation, the right to file foreign patent applications and
license recordations. Such right, title and interest in and to the Patents,
shall be held and enjoyed by ASSIGNEE, its successors, legal representatives and
assigns, as fully, entirely and exclusively as the same would have been held and
enjoyed by ASSIGNOR had this Assignment not been made.
This Assignment is effective as of the date hereof. ASSIGNOR agrees to
execute and deliver, or cause to be executed and delivered, to ASSIGNEE or
ASSIGNEE's legal representatives, any other or additional assignments, powers
and other appropriate documentation, and to take such actions as are reasonable
and necessary, to enable ASSIGNEE to effectuate, validate and record this
Assignment with the United States Patent and Trademark Office and the
appropriate agencies and offices of all jurisdictions in which any of the
Patents are or may be registered or in which applications for registration of
any of the Patents are pending,
pursuant to the terms, conditions and time periods prescribed by the relevant
laws and regulations of the United States and other jurisdictions identified in
Schedule A as soon as is practicable after the date of this Assignment.
ASSIGNOR hereby authorizes and requests the Commissioner of Patents and
Trademarks of the United States of America and the appropriate officers of all
other jurisdictions in which the Patents are or may be registered or in which
applications included among the Patents are pending, to record the title of
ASSIGNEE, its successors, legal representatives and assigns, as owner of all
right, title and interest in and to the Patents and to issue to ASSIGNEE, its
successors, legal representatives and assigns, patent registrations and
recordations of patent rights resulting from any application included among the
Patents or renewal for any existing registration of any of the Patents, in
accordance with the terms of this instrument.
IN WITNESS WHEREOF, the undersigned has executed this Assignment as of
this ____ day of _________, ____.
NASTECH PHARMACEUTICAL COMPANY, INC.
SEAL
By:_____________________________
Name:
Title:
A C K N O W L E D G M E N T
STATE OF __________________ )
) ss:
COUNTY OF _________________ )
On this _______ day of ___________________, ____, before me personally appeared
_______________, to me personally known, who, being duly sworn, did say that he
is the _____________ of Nastech Pharmaceutical Company, Inc. and that he duly
executed the foregoing instrument for and on behalf of Nastech Pharmaceutical
Company, Inc. being duly authorized to do so and that said individual
acknowledged said instrument to be the free act and deed of said corporation.
__________________________
Notary Public
DISCLOSURE SCHEDULES
EXHIBIT A
ASSIGNMENT AND ASSUMPTION AGREEMENT
EXHIBIT B
BILL OF SALE
EXHIBIT C
SUPPLY AGREEMENT
EXHIBIT D
SECURITY AGREEMENTS