EXIBIT 10.9.1
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OPTION AGREEMENT
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This Option Agreement (the "Agreement") is made as of the 6th day of
March, 2003, by and between Stiefel Laboratories, Inc., a New York corporation
("Stiefel"), and INyX Pharma, Limited., a company organized under the laws of
England and Wales (the "Company").
RECITALS
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WHEREAS, the Company and Stiefel have entered into a certain 6%
Convertible Promissory Note due March 6, 2007 (the "Note"), for an aggregate
principal amount of GBP2,500,000 (the "Principal Amount");
WHEREAS, pursuant to the terms and conditions of the Note, Stiefel may, at
any time during the life of the Note, convert the entirety of the then
outstanding Principal Amount into equity securities of the Company (the
"Conversion Shares");
WHEREAS, upon Stiefel's conversion of the entire Principal Amount of the
Note into Conversion Shares, Stiefel's Conversion Shares shall represent twenty
percent (20%) of the rights to vote at general meetings of the Company and
twenty percent (20%) of the right to receive amounts distributed by the Company
by way of dividend or other distribution of the Company's assets (the "Maximum
Stiefel Percentage Interest"), and if the Company pays down the Principal Amount
on the Note, the Maximum Stiefel Percentage Interest shall be adjusted
proportionately (the "Adjusted Stiefel Percentage Interest");
WHEREAS, Stiefel desires to have the option to purchase that amount of
equity shares of the Company that are required for Stiefel to maintain either
the Maximum Stiefel Percentage Interest or the Adjusted Stiefel Percentage
Interest (as applicable); and
WHEREAS, as a condition precedent and material inducement for Stiefel to
extend the Principal Amount to the Company pursuant to the Note, the Company
must execute and deliver this Agreement to Stiefel.
NOW THEREFORE, in consideration of the above recitals and the mutual
covenants, representations, warranties and agreements set forth herein, and for
the purpose of defining the terms and provisions of this Agreement, and for
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties hereto intending to be legally bound do hereby
agree as follows:
AGREEMENT
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1. Definitions. Capitalized terms used herein are used as defined in this
Section 1 or as defined elsewhere in this Agreement. For purposes of this
Agreement:
(a) The term "Business Day" shall mean any day on which the
commercial banks in the City of Miami, Florida and London, England are open for
business.
(b) The term "Dilutive Event" shall mean any issuance by the Company
of any class of its equity securities or debt or equity securities convertible
into any class of its equity securities (an "Equity Issue") or any other action
by the Company (other than the repayment of the Note) that would have the effect
of reducing the percentage of the Company's Outstanding Capital Stock
represented by the Conversion Shares to a percentage below the Maximum Stiefel
Percentage Interest or the Adjusted Stiefel Percentage Interest (as applicable).
(c) The term "Fair Market Price" shall mean such price as may be
agreed between the Company and Stiefel or, in the event that agreement cannot be
reached, the price which an Independent Expert states in writing to be in its
opinion the fair value of the shares concerned on a sale as between a willing
seller and a willing purchaser and in determining such fair value the
Independent Expert shall be instructed in particular:
(i) to have regard to the rights and restrictions attached to
such shares in respect of income, capital and voting but to
disregard any other special rights or restrictions attached to such
shares;
(ii) to disregard whether such shares represent a minority or
a majority interest; and
(iii) if the Company is then carrying on business as a going
concern, to assume that it will continue to do so,
and the Independent Expert shall be considered to be acting as an expert
and not as an arbitrator and its decision shall be final and binding.
(d) The term "Independent Expert" shall mean an independent firm of
accountants, investment bankers or a similar suitably qualified organization to
be mutually agreed upon by the parties.
(e) The term "Option Price" shall mean the price per share at which
equity securities are sold pursuant to an Equity Issue constituting a Dilutive
Event or, if there is no Equity Issue, the Fair Market Price of the subject
equity securities relating to the subject Dilutive Event.
(f) The term "Option Shares" shall mean that amount of any class of
the Company's equity shares that represent the Maximum Stiefel Percentage
Interest or the Adjusted Stiefel Percentage Interest (as applicable) of the
total number of equity securities of the Company that are issued in connection
with a subject Dilutive Event.
(g) The term "Outstanding Capital Stock" shall mean, at any time,
the issued and outstanding shares of capital stock of the Company on a fully
diluted basis (i.e. all issued equity shares of the Company and all those equity
shares of the Company which are issuable upon the exercise of options, puts,
convertible debentures, warrants or other securities exercisable or exchangeable
in respect of or for the Company's equity shares).
2. Option.
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(a) During the period commencing on the date that Stiefel shall have
converted the Principal Amount of the Note into Conversion Shares until the date
that Stiefel shall no longer be a holder of any of the Company's equity
securities (the "Option Period"), Stiefel may exercise, from time to time during
the Option Period and subject to the terms and conditions contained herein, the
option to acquire the Option Shares for the Option Price (the "Option"). The
exercise by Stiefel of the Option shall entitle Stiefel to purchase, and shall
require the Company to sell, the Option Shares as herein provided.
(b) During the Option Period, the Company shall provide prior
written notice to Stiefel of any Dilutive Event (a "Dilutive Event Notice").
(c) The Option may be exercised by Stiefel as to all or less than
all of the Option Shares at any time during the Option Period by delivery of
written notice(s) from Stiefel to the Company (the "Notice of Exercise") at the
address specified on the signature page hereto designating the number of and
description of the desired class of Option Shares to be purchased and a date and
time for closing the purchase and sale of such Option Shares (each, a "Closing
Date"), which date and time shall not be earlier than the close of business on
the 5th Business Day, nor later than the close of business on the 10th Business
Day, following delivery by Stiefel of the Notice of Exercise pursuant to this
paragraph.
(d) Upon the exercise of the Option by Stiefel, the Option Price (or
the corresponding proportionate amount of the Option Price in the event of an
exercise of the Option for less than all of the Option Shares) shall be paid by
Stiefel to the Company on the Closing Date by wire transfer of immediately
available funds. In exchange for the payment by Stiefel of the Option Price (or
the lesser proportionate purchase price), the Company shall deliver to Stiefel
certificates evidencing the Option Shares described in the Notice of Exercise in
proper form for transfer, free and clear of any claims, security interests,
liens and encumbrances of any kind, except as provided by law and/or in the
Stockholders Agreement.
3. Closing of Option. The closing of each purchase and sale of Option
Shares hereunder upon the exercise of the Option (each, a "Closing") shall be
held at the principal offices of the Company on the date and time specified in
the Notice of Exercise.
4. Representations and Warranties of the Company. The Company hereby
represents and warrants to Stiefel as of the date hereof:
4.1 Authority. It has full right, power and authority to enter into
this Agreement, and this Agreement has been duly authorized, executed and
delivered by it and constitutes the legal, valid and binding agreement of the
Company enforceable against the Company in accordance with its terms (except in
all cases as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, or similar laws affecting the
enforcement of creditors' rights generally and except that the availability of
the equitable remedy of specific performance or injunctive relief is subject to
the discretion of the court before which any proceeding may be brought).
4.2 Actions Pending. There is no action, suit, claim, investigation
or proceeding pending or, to the knowledge of the Company, threatened against it
which questions the validity of this Agreement and the transactions contemplated
hereby or thereby, or any action taken or to be taken pursuant hereto or
thereto.
4.3 No Conflicts. The execution and delivery of this Agreement does
not, and the consummation of the transactions contemplated hereby will not,
conflict with, or result in any breach pursuant to any provision of any of the
constituent documents of the Company or result in any breach of any material
loan or credit agreement, note, mortgage, indenture, lease, pension plan or
other agreement or obligation of the Company or its properties or assets.
5. Miscellaneous.
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5.1 Impairment. The Company will not, by amendment of its charter
documents or through reorganization, consolidation, merger, dissolution, issue
or sale of securities, sale of assets or any other voluntary action, avoid or
seek to avoid the observance or performance of any of the terms of this
Agreement. The Company shall not take any steps in relation to its share capital
which would have the effect of reducing the Option Price payable per share below
par value.
5.2 Issue of Shares. The Company shall, during the Option Period,
ensure that the Company maintains sufficient authorized but unissued share
capital and other authorities and powers of directors of the Company and take
all other requisite action to enable the prompt issue of shares pursuant to any
exercise of the Option.
5.3 Further Assurances. Subject to the terms and conditions herein
provided, each of the parties hereto agrees to use all reasonable efforts to
take, or cause to be taken, all action and to do, or cause to be done, all
things necessary, proper or advisable to consummate and make effective as
promptly as practicable the transactions contemplated by this Agreement,
including, without limitation, using all reasonable efforts to obtain all
necessary waivers, consents and approvals and to effect all necessary
registrations and filings.
5.4 Parties in Interest. All representations, covenants and
agreements contained in this Agreement by or on behalf of any of the parties
hereto shall bind and inure to the benefit of the respective successors and
assigns of the parties hereto whether so expressed or not.
5.5 Amendments and Waivers. Any term of this Agreement may be
amended or waived in writing and only with the written consent of Stiefel and
the Company.
5.6 Notices. Unless otherwise provided herein, any notice required
or permitted by this Agreement shall be in writing and shall be deemed
sufficient upon delivery, when delivered personally or by overnight courier or
sent by telegram or fax, or five (5) Business Days after being deposited in the
U.S. mail as certified or registered mail with postage prepaid, and addressed to
the party to be notified at such party's address or fax number as set forth
below or as subsequently modified by written notice.
5.7 Severability. If one or more provisions of this Agreement are
held to be unenforceable under applicable law. The parties agree to renegotiate
such provision in good faith. In the event that the parties cannot reach a
mutually agreeable and enforceable replacement for such provision, then (a) such
provision shall be excluded from this Agreement, (b) the balance of the
Agreement shall be interpreted as if such provision were so excluded and (c) the
balance of the Agreement shall be enforceable in accordance with its terms.
5.8 Governing Law. This Agreement and all acts and transactions
pursuant hereto shall be governed, construed and interpreted in accordance with
the laws of the State of Florida without giving effect to principles of
conflicts of laws.
5.9 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
5.10 Titles and Subtitles. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
5.11 Expenses. Each party hereto will pay its own expenses in
connection with the transactions contemplated hereby, whether or not such
transactions shall be consummated; provided that, if any action at law or in
equity is necessary to enforce or interpret the terms of this Agreement, the
prevailing party shall be entitled to reasonable attorneys' fees, cost and
necessary disbursements in addition to any other relief to which such party may
be entitled.
5.12 Entire Agreement. This Agreement constitutes the full and
entire understanding and agreement between the parties with regard to the
subject matter hereof. 5.13 Survival of Agreement. All representations and
warranties made herein or in any agreement, certificate or instrument delivered
to Stiefel pursuant to or in connection with this Agreement shall survive the
execution and delivery of this Agreement and the issuance, sale and delivery of
the Option Shares.
5.14 Brokerage. Each party hereto will indemnify and hold harmless
the others against and in respect of any claim for brokerage or other
commissions relative to this Agreement or to the transactions contemplated
hereby, based in any way on agreements, arrangements or understandings made or
claimed to have been made by such party with any third party.
[signature page follows]
The parties have executed this Option Agreement as of the date first above
written.
STIEFEL LABORATORIES, INC.
By /s/ Tessie L. Brunken
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Name: Tessie L. Brunken
Title: Vice President, CFO and Treasurer
Address: 255 Alhambra Circle Coral Gables, Florida
Fax:
INYX PHARMA, LTD.
By: /s/ Steve Handley
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Name: Steve Handley
Title: Director
Address: 6 Seymour Court, Manor Park
Runicorn
Cheshire, England
Fax: 01928 579212