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STOCKHOLDERS AGREEMENT
DATED AS OF DECEMBER 10, 2001
BY AND AMONG
ASTRALIS LTD.
SKYEPHARMA PLC
THE PARTIES LISTED IN ANNEX A HERETO
AND
THE PARTIES WHO EXECUTE ADDENDUMS
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TABLE OF CONTENTS
ARTICLE I DEFINITIONS.........................................................1
ARTICLE II GOVERNANCE.........................................................3
2.1 Board of Directors...................................................3
2.2 Stockholder Votes....................................................4
2.3 Certificate of Incorporation and By-laws.............................4
ARTICLE III TRANSFERS.........................................................5
3.1 Transfers............................................................5
3.2 Consent of Directors.................................................5
ARTICLE IV MISCELLANEOUS......................................................5
4.1 Ownership of Shares..................................................5
4.2 Legends..............................................................6
4.3 Notices..............................................................6
4.4 Severability.........................................................7
4.5 Entire Agreement; Amendments and Waivers; Addendums..................7
4.6 Successors and Assigns...............................................8
4.7 Consent to Specific Performance......................................8
4.8 Variations in Pronouns...............................................8
4.9 Governing Law; Submission to Jurisdiction; Selection of Forum........8
4.10 Further Assurances...................................................9
4.11 Cumulative Remedies..................................................9
4.12 Headings.............................................................9
4.13 Counterparts.........................................................9
This Stockholders Agreement (this "Agreement") is dated as of
December 10, 2001 by and among Astralis Ltd., a Delaware corporation (the
"Corporation"), SkyePharma PLC, a company incorporated under the laws of England
and Wales ("SkyePharma"), those parties listed in Annex A hereto (the "Original
Stockholders"), and the parties subject to an Addendum (as hereinafter defined).
All parties to this Agreement and any Addendum, with the exception of the
Corporation, are collectively referred to as the "Stockholders."
RECITALS
WHEREAS, the Original Stockholders own shares of the issued
and outstanding voting Common Stock of the Corporation, par value $0.0001 per
share ("Common Stock");
WHEREAS, the Corporation and SkyePharma have entered into a
Purchase Agreement, dated as of December 10, 2001 (the "Purchase Agreement"),
providing for a significant investment by SkyePharma in the Corporation by means
of purchase of shares of the Corporation's Series A Convertible Preferred Stock,
par value $0.001, (the "Convertible Preferred Stock") and a Registration Rights
Agreement, dated as of December 10, 2001 (the "Registration Rights Agreement"),
providing for the registration of such shares of Convertible Preferred Stock and
the shares of Common Stock issuable on conversion of such Convertible Preferred
Stock; and
WHEREAS, the Corporation and the Stockholders desire to enter
into this Agreement for the purpose of regulating governance of the Corporation
and certain aspects of the Stockholders' relationships with regard to each other
and the Corporation.
NOW THEREFORE, in consideration of the mutual promises and
covenants set forth in this Agreement and other good and valuable consideration,
the receipt, sufficiency and adequacy of which are hereby acknowledged, the
parties hereto agree as follows:
ARTICLE I
DEFINITIONS
As used herein, the terms below shall have the following
meanings. Any such term, unless the context otherwise requires, may be used in
the singular or plural, depending upon reference.
"Addendum" shall be the addendum to this Agreement attached
hereto as Annex B.
"Agreement" shall have the meaning set forth in the Preamble
and shall include all Addendums.
"Affiliate" shall mean, with respect to any Person, any other
Person who, directly or indirectly through one or more intermediaries, controls,
is controlled by or is under common control with such Person. For purposes of
this definition, "control" when used with respect to any Person means the power
to direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by appointment of directors,
by contract or otherwise.
"Board of Directors" shall mean the Board of Directors of the
Corporation.
"Business Day" shall mean each Monday, Tuesday, Wednesday,
Thursday and Friday that is not a day on which banking institutions in the City
of New York are authorized or obligated by law or executive order to remain
closed.
"By-laws" shall mean the by-laws of the Corporation.
"Certificate of Incorporation" shall mean the Certificate of
Incorporation of the Corporation, as amended.
"Common Stock" shall have the meaning set forth in the
recitals of this Agreement.
"Convertible Preferred Stock" shall have the meaning set forth
in the Recitals of this Agreement.
"Corporation" shall have the meaning set forth in the
Preamble.
"Director" shall mean a member of the Board of Directors.
"Exchange Act" shall mean the Securities Exchange Act of 1934,
and the rules and regulations promulgated thereunder, as the same may be amended
from time to time.
"Group" shall mean, in the case of any Stockholder, such
Stockholder and (i) all Affiliates of such Stockholder, (ii) all partners of
such Stockholder if such Stockholder is a partnership, (iii) any Person to which
such Stockholder transfers all or substantially all of its assets or any entity
into which such Stockholder merges and (iv) in the case of a Stockholder that is
an individual, the spouse and lineal descendants of such Stockholder, any trust
for the benefit of such spouse or any such lineal descendant, or any other
family member of such Stockholder.
"Independent Director" shall mean a person who is independent
of the Corporation's management and who is not a director, officer, in the Group
of or an employee of any Stockholder.
"Original Stockholders" shall have the meaning set forth in
the Preamble.
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"Person" shall be construed broadly and shall include an
individual, a partnership, a corporation, an association, a joint stock company,
a limited liability company, a trust, a joint venture, an unincorporated
organization and a governmental entity or any department, agency or political
subdivision thereof or any group comprised of such individuals or entities.
"Purchase Agreement" shall have the meaning set forth in the
Recitals.
"Registration Rights Agreement" shall have the meaning set
forth in the Recitals.
"Registration Statement" shall mean a registration statement
filed with the Securities and Exchange Commission on which it is permissible to
register securities for sale to the public under the Securities Act.
"Securities Act" shall mean the Securities Act of 1933, and
the rules and regulations promulgated thereunder, as the same may be amended
from time to time.
"SkyePharma Director" shall have the meaning set forth in
Section 2.1(a).
"Stockholders" shall have the meaning set forth in the
Preamble.
"Transfer" shall mean to directly or indirectly sell, give,
transfer, assign, pledge, hypothecate or otherwise dispose of, or to contract or
agree to do any of the foregoing.
"Warrants" shall mean the Warrants, issued by the Corporation
to certain Stockholders, allowing such Stockholders to purchase shares of Common
Stock at a preset price per share of Common Stock upon exercise of such
Warrants.
ARTICLE II
GOVERNANCE
2.1 Board of Directors.
(a) From and after March 31, 2002, at all times while this
Agreement is in effect, the Board of Directors of the Corporation shall be
comprised of at least six Directors and include at least two Independent
Directors. The Board of Directors of the Corporation shall at all times use its
best effort to nominate at least two persons for election by the holders of
shares of Common Stock to serve as Independent Directors. One other Director
shall be nominated and elected in accordance with the Certificate of
Designations, Preferences and Rights of Convertible Preferred Stock of Astralis
Ltd., adopted by the Board of Directors as of December 10, 2001 (the
"Certificate of Designations"). After all the shares of Convertible Preferred
Stock that were purchased pursuant to the Purchase Agreement have been converted
into shares of Common Stock, one Director shall be nominated by SkyePharma (the
"SkyePharma Director"). The SkyePharma Director shall serve on each Committee of
the Board of Directors.
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(b) If, at any time when this Agreement is in effect,
SkyePharma requests that such SkyePharma Director be removed (with or without
cause) by written notice thereof to the other Stockholders, then each
Stockholder shall vote all shares of Common Stock owned or held of record by
such Stockholder to effect the removal and vote for the replacement Director
designated by SkyePharma.
(c) If, at any time when this Agreement is in effect, a
vacancy is created on the Board of Directors at any time by reason of death,
disability, retirement, resignation, removal or otherwise of the SkyPharma
Director, SkyePharma shall be entitled to nominate a successor Director to fill
the vacancy created thereby.
(d) From and after March 31, 2002, at all times while this
Agreement is in effect, a quorum of the Board of Directors shall consist of a
majority of the entire Board of Directors and must include at least one
Independent Director.
2.2 Stockholder Votes.
(a) Each Stockholder shall vote its shares of Common Stock
(including any shares of Common Stock issued upon exercise of any Warrants) at
any regular or special meeting of stockholders of the Corporation or in any
written consent executed in lieu of such a meeting of stockholders of the
Corporation, and shall take all other actions necessary, to elect the
Independent Directors nominated by the Board of Directors as described in
Section 2.1(a) of this Agreement.
(b) Each Stockholder shall vote its shares of Common Stock,
(including any shares of Common Stock issued upon exercise of any Warrants) at
any regular or special meeting of stockholders of the Corporation or in any
written consent executed in lieu of such a meeting of stockholders of the
Corporation, and shall take all other actions necessary, to elect the nominee if
so nominated to the Board of Directors by SkyePharma pursuant to Section 2.1(a)
or 2.1(c) of this Agreement.
(c) Each Stockholder agrees that such Stockholder shall not
deposit any shares of Common Stock in a voting trust or subject the shares of
Common Stock to any agreement, arrangement or understanding with respect to the
voting of the shares of Common Stock inconsistent with this Agreement.
2.3 Certificate of Incorporation and By-laws.
The Certificate of Incorporation and the By-laws shall be
amended and restated as necessary and appropriate to give effect to the
provisions set forth in this Agreement.
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ARTICLE III
TRANSFERS
3.1 Transfers.
Other than Transfers to the public pursuant to an effective
Registration Statement or on a recognized national securities exchange, the
Nasdaq Stock Market or the Nasdaq SmallCap Market, each Stockholder (other than
SkyePharma) will cause any proposed transferee of any share of Common Stock or
of any Warrant held by him or it to agree to take and hold such share of Common
Stock or Warrant, as the case may be subject to the provisions and upon the
conditions specified in this Agreement and to become a party to this Agreement
as set forth in the Addendum to this Agreement. No Transfer shall be binding
upon the Corporation unless:
(i) each transferee shall have executed and
delivered to the Corporation, as a condition
precedent to any Transfer of shares of
Common Stock or of any Warrant, a written
agreement confirming that such transferee
agrees to be bound by the terms of this
Agreement; and
(ii) the certificates issued to the transferee
which represent the shares of Common Stock
or Warrants so Transferred shall bear the
legends provided in Section 4.2.
3.2 Consent of Directors.
Notwithstanding anything to the contrary contained in this
Agreement, a Stockholder may Transfer shares of Common Stock or Warrants (and
the Corporation shall reflect on its books such Transfer) if the specific terms
of such Transfer and the transferee thereof shall, prior to the effectiveness of
such Transfer, have been approved by the unanimous consent of the Board of
Directors.
ARTICLE IV
MISCELLANEOUS
4.1 Ownership of Shares.
Annex A hereto correctly sets forth, as of the date of this
Agreement, the number of shares of Common Stock and Warrants owned beneficially
and of record by each Original Stockholder.
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4.2 Legends.
Each share of Common Stock (including any shares of Common
Stock issuable upon exercise of any Warrants) and any Warrants issued to each
Stockholder or a subsequent transferee that is required to be bound by this
Agreement shall include, in addition to any other legend that may be required by
agreement of the Stockholder and any other legend required under applicable
state or federal securities laws, a legend in the following form or a
substantially similar form:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY NOT BE
TRANSFERRED, SOLD, GIVEN, ASSIGNED, PLEDGED, HYPOTHECATED OR
OTHERWISE DISPOSED OF (A "TRANSFER") EXCEPT IN ACCORDANCE WITH
THE PROVISIONS OF A STOCKHOLDERS AGREEMENT, DATED AS OF
DECEMBER 10, 2001. ANY TRANSFEREE OF THESE SECURITIES TAKES
SUBJECT TO THE TERMS OF SUCH AGREEMENT, A COPY OF WHICH IS ON
FILE WITH THE CORPORATION."
4.3 Notices.
All notices, requests, demands and other communications which
are required or may be given under this Agreement shall be in writing and shall
be deemed to have been duly given when received if personally delivered; when
transmitted, if transmitted by telecopy, electronic or digital transmission
method; the day after it is sent, if sent for next day delivery to a U.S.
address by recognized overnight delivery service (e.g., Federal Express); and
upon receipt, if sent by registered or certified mail (or any substantially
similar form of mail), postage prepaid and return receipt requested. In each
case notice shall be sent to:
If to the Corporation addressed to:
Astralis Ltd.
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Attention: Mr. ▇▇▇▇ Ajnsztajn
Telecopier: ▇▇-▇▇▇-▇▇▇-▇▇▇▇
With a copy to:
▇▇▇▇▇, Danzig, Scherer, ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇ LLP
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Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
Telecopier: ▇▇-▇▇▇-▇▇▇-▇▇▇▇
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If to SkyePharma addressed to:
SkyePharma PLC
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Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Telecopier: ▇▇▇-▇▇-▇▇▇▇-▇▇▇▇
With a copy to:
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St Olave's House
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Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Telecopier: ▇▇▇-▇▇-▇▇▇▇-▇▇▇▇
If to any Stockholder (other than SkyePharma), to such
Stockholder at the address indicated in Annex A hereto or in the Addendum.
Changes in notice addresses may be made by a notice delivered to the Corporation
pursuant to this Section 4.3.
4.4 Severability.
In the event that any one or more of the provisions contained
in this Agreement shall, for any reason, be held to be invalid, illegal or
unenforceable in any respect, then to the maximum extent permitted by law, such
invalidity, illegality or unenforceability shall not affect any other provision
of this Agreement.
4.5 Entire Agreement; Amendments and Waivers; Addendums.
(a) This Agreement, constitutes the entire agreement among the
parties pertaining to the subject matter hereof and supersedes all prior
agreements, understandings, negotiations and discussions, whether oral or
written, of the parties. This Agreement shall terminate upon the earlier of (i)
the date on which SkyePharma ceases to own any of the shares of Common Stock
issued as a result of the conversion of shares of Convertible Preferred Stock
and no longer owns any shares of Convertible Preferred Stock or (ii) the mutual
written consent of the parties hereto. No waiver of any of the provisions of
this Agreement shall be deemed or shall constitute a waiver of any other
provision hereof (whether or not similar), nor shall such waiver constitute a
continuing waiver unless otherwise expressly provided.
(b) It being the intent of the Stockholders and the
Corporation that this Agreement shall be the sole and exclusive agreement with
respect to the matters set forth herein and, during the term of this Agreement,
each Stockholder and the Corporation agrees not to enter into any other
agreements or arrangements that are (i) in conflict with or are expressly
governed by the terms of this Agreement or (ii) in conflict with the rights
granted to SkyePharma (if such rights are different from the rights of other
Stockholders) except for agreements or arrangements that are approved or
consented to by SkyePharma, as the case may be.
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(c) Additional Stockholders may be added to this Agreement
upon execution of an Addendum to this Agreement (an "Addendum"), a form of which
is attached hereto as Annex B, with such modifications thereto applicable to
such Stockholder set forth therein.
4.6 Successors and Assigns.
This Agreement shall inure to the benefit of, and be binding
upon, the Corporation, each Stockholder and their respective successors,
assigns, heirs, executors and administration.
4.7 Consent to Specific Performance.
The parties hereto declare that it is impossible to measure in
money the damages which would accrue to a party by reason of failure to perform
any of the obligations hereunder. Therefore, if any party shall institute any
action or proceeding to enforce the provisions hereof, any party against whom
such action or proceeding is brought hereby waives any claim or defense therein
that the other party has an adequate remedy at law.
4.8 Variations in Pronouns.
All pronouns and any variations thereof shall be deemed to
refer to the masculine, feminine or neuter, singular or plural, as the identity
of the antecedent person or persons or entity or entities may require.
4.9 Governing Law; Submission to Jurisdiction; Selection of Forum.
This Agreement shall be construed in accordance with the laws
of the State of New York, without regard to conflict of law provisions thereof.
Each party hereto agrees that it shall bring up any action or proceeding in
respect of any claim arising out of or related to this agreement or the
transactions contained in and contemplated by this Agreement, whether in tort or
contract or at law or in equity, exclusively in the United States District Court
for the Southern District of New York or, if such court is not available, the
Supreme Court of the State of New York for the county of New York (the "Chosen
Courts") and solely in connection with claims arising under this Agreement or
the transactions contained in or contemplated by this Agreement (i) irrevocably
submits to the exclusive jurisdiction of the Chosen Courts, (ii) waives any
objection to laying venue in any such action or proceeding in the Chosen Courts
and agrees not to commence any action in respect of any such claim in any other
court or forum, (iii) waives any objection that the Chosen Courts are an
inconvenient forum or do not have jurisdiction over any party hereto, (iv)
waives any right to a trial by jury and (v) agrees that service of process upon
such party in any such action or proceeding shall be effective if notice is
given in accordance with Section 4.3 of this Agreement.
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4.10 Further Assurances.
Each of the parties shall execute and deliver such further
instruments and documents and take such further actions as may be reasonably
required or desirable to carry out the provisions hereof and the transactions
contemplated hereby.
4.11 Cumulative Remedies.
All rights and remedies of each party hereto are cumulative of
each other and of every other right or remedy such party may otherwise have at
law or in equity, and the exercise of one or more rights or remedies shall not
prejudice or impair the concurrent or subsequent exercise of other rights or
remedies.
4.12 Headings.
The titles, captions or headings of the Articles and Sections
herein are for convenience of reference only and are not intended to be a part
of or to affect the meaning or interpretation of this Agreement.
4.13 Counterparts.
This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this
Stockholders Agreement as of the date first written above.
Astralis Ltd.
By:
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Name:
Title:
SkyePharma PLC
By:
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Name:
Title:
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▇▇▇▇ ▇▇▇▇▇▇▇ ▇'▇▇▇▇
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▇▇▇▇ Ajnsztajn
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ANNEX A
LIST OF ORIGINAL COMMON STOCKHOLDERS,
ADDRESSES AND HOLDINGS
NAME AND ADDRESS SHARES
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▇▇▇▇ ▇▇▇▇▇▇▇ ▇'▇▇▇▇ 13,915,000
▇▇▇▇ Ajnsztajn 8,855,000
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ 2,530,000
Each Original Stockholder's business address is c/o Astralis Ltd., ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, U.S.
A-1
ANNEX B
Addendum to
Stockholders Agreement
ADDENDUM, dated as of , ____, by and between Astralis Ltd.,
(the "Corporation"), and the party listed on the signature page hereto (the
"Additional Stockholder").
WHEREAS, the Corporation, SkyePharma PLC, and the parties
listed in Annex A of the Stockholders Agreement, dated as of December 10, 2001
(the "Agreement"), entered into the Agreement for the purpose of regulating
governance of the Corporation and certain aspects of relationships of
Stockholders party to the Agreement with regard to each other and the
Corporation;
NOW THEREFORE, in consideration of the mutual promises and
covenants herein contained, and other good and valuable consideration, the
receipt, sufficiency and adequacy of which are hereby acknowledged, parties
hereto agree as follows:
1. Definitions. Defined terms used herein and not otherwise
defined shall have the meanings set forth in the Agreement.
2. Additional Party to the Agreement. Pursuant to Section
4.5(c) of the Agreement, the Corporation hereby agrees that the Additional
Stockholder is, and the Additional Stockholder hereby agrees to be a party to
the Agreement as a Stockholder (but not an Original Stockholder).
3. Counterparts. This Addendum may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
4. [If appropriate - Modifications to the Agreement.]
B-1
IN WITNESS WHEREOF, the parties hereto have caused this
Addendum to be duly executed by their respective authorized officers as of the
date first written above.
Astralis Ltd.
By:
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Name:
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Title:
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Stockholder
By:
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Name:
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Title:
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