Exhibit 2.3
ASSET PURCHASE AGREEMENT
by and between
NOVARTIS PHARMACEUTICALS CORPORATION,
NOVARTIS CORPORATION,
and
NEOSAN PHARMACEUTICALS INC.
dated as of December 13, 2001
TABLE OF CONTENTS
PAGE
Article I. Definitions.................................................................1
SECTION 1.01 DEFINED TERMS.......................................................1
SECTION 1.02 CONSTRUCTION OF CERTAIN TERMS AND PHRASES...........................8
Article II. Purchase and Sale of Purchased Assets......................................9
SECTION 2.01 PURCHASE AND SALE OF PURCHASED ASSETS...............................9
Article III. Assumption of Liabilities.................................................9
SECTION 3.01 ASSUMPTION OF ASSUMED LIABILITIES...................................9
Article IV. Purchase Price and Payment................................................10
SECTION 4.01 PURCHASE PRICE.....................................................10
SECTION 4.02 ALLOCATION OF PURCHASE PRICE.......................................10
SECTION 4.03 PAYMENT OF SALES, USE AND OTHER TAXES..............................10
Article V. Closing....................................................................10
SECTION 5.01 TIME AND PLACE.....................................................10
SECTION 5.02 DELIVERIES AT CLOSING..............................................10
Article VI. Representations and Warranties of Seller..................................12
SECTION 6.01 ORGANIZATION.......................................................12
SECTION 6.02 AUTHORITY OF SELLER................................................12
SECTION 6.03 CONSENTS AND APPROVALS.............................................13
SECTION 6.04 NON-CONTRAVENTION..................................................13
SECTION 6.05 MATERIAL CONTRACTS.................................................13
SECTION 6.06 INTELLECTUAL PROPERTY RIGHTS.......................................13
SECTION 6.07 LITIGATION.........................................................14
SECTION 6.08 COMPLIANCE WITH LAW................................................15
SECTION 6.09 TITLE TO PURCHASED ASSETS..........................................15
SECTION 6.10 REGULATORY MATTERS.................................................15
SECTION 6.11 BROKERS............................................................16
SECTION 6.12 NO NON-COMPETITION AGREEMENTS OR PREFERENTIAL OBLIGATIONS..........16
SECTION 6.13 ORDINARY COURSE....................................................16
SECTION 6.14 EXCLUSIVE REPRESENTATIONS AND WARRANTIES...........................16
Article VII. Representations and Warranties of Buyer..................................16
SECTION 7.01 CORPORATE ORGANIZATION.............................................16
SECTION 7.02 AUTHORITY OF BUYER.................................................17
SECTION 7.03 CONSENTS AND APPROVALS.............................................17
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SECTION 7.04 NON-CONTRAVENTION..................................................17
SECTION 7.05 LITIGATION.........................................................18
SECTION 7.06 BROKERS............................................................18
SECTION 7.07 EXCLUSIVE REPRESENTATIONS AND WARRANTIES...........................18
Article VIII. Covenants of the Parties................................................18
SECTION 8.01 COOPERATION........................................................18
SECTION 8.02 ACCESS.............................................................18
SECTION 8.03 BULK SALES.........................................................19
SECTION 8.04 CORPORATE NAMES....................................................19
SECTION 8.05 ASSISTANCE IN COLLECTING CERTAIN AMOUNTS...........................20
SECTION 8.06 DIFFERENTIATION OF PRODUCTS........................................20
SECTION 8.07 REGULATORY MATTERS.................................................20
SECTION 8.08 PRODUCT RETURNS; REBATES; MANAGED CARE CONTRACTS...................21
SECTION 8.09 FURTHER ASSURANCES.................................................23
SECTION 8.10 TRANSITION TEAM....................................................23
SECTION 8.11 NDC NUMBERS........................................................23
SECTION 8.12 INSURANCE..........................................................23
Article IX. Indemnification...........................................................24
SECTION 9.01 SURVIVAL OF REPRESENTATIONS, WARRANTIES, ETC.......................24
SECTION 9.02 INDEMNIFICATION....................................................24
Article X. Miscellaneous..............................................................27
SECTION 10.01 CONFIDENTIALITY....................................................27
SECTION 10.02 NOTICES............................................................29
SECTION 10.03 ENTIRE AGREEMENT...................................................30
SECTION 10.04 WAIVER.............................................................30
SECTION 10.05 AMENDMENT..........................................................31
SECTION 10.06 THIRD PARTY BENEFICIARIES..........................................31
SECTION 10.07 ASSIGNMENT; BINDING EFFECT.........................................31
SECTION 10.08 HEADINGS...........................................................31
SECTION 10.09 SEVERABILITY.......................................................31
SECTION 10.10 GOVERNING LAW......................................................32
SECTION 10.11 CONSENT TO JURISDICTION AND FORUM SELECTION........................32
SECTION 10.12 WAIVER OF JURY TRIAL...............................................32
SECTION 10.13 SPECIFIC PERFORMANCE...............................................33
SECTION 10.14 EXPENSES...........................................................33
SECTION 10.15 COUNTERPARTS.......................................................33
SECTION 10.16 SCHEDULES, EXHIBITS AND OTHER AGREEMENTS...........................33
SECTION 10.17 PUBLICITY..........................................................33
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EXHIBITS
A - Assumption Agreement
B - ▇▇▇▇ of Sale and Assignment
C - Guaranty Agreement
D - Interim Supply Agreement
E - License Agreement
F - Trademark Assignment Agreement
G - Press Release
SELLER DISCLOSURE SCHEDULE
1.01 Product Trademarks
4.02 Purchase Price Allocation
6.05 Material Contracts
6.06(a) Registered Intellectual Property
6.07 Litigation
6.10(b) Regulatory Matters
6.10(c) Permits, Licenses and Registrations
8.08(d) Managed Care Contracts
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ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement (this "Agreement") is made and entered
into as of December 13, 2001, by and among NEOSAN PHARMACEUTICALS INC., a
Delaware corporation ("Buyer") that is a wholly-owned subsidiary of AAIPHARMA
INC., a Delaware corporation, NOVARTIS PHARMACEUTICALS CORPORATION, a
corporation organized under the laws of Delaware ("Novartis"), and NOVARTIS
CORPORATION, a New York corporation ("Novartis Corp."; Novartis and Novartis
Corp. referred to collectively herein as "Seller").
RECITALS
Whereas, Seller is engaged in the business of manufacturing,
marketing, selling and distributing the Products (as defined below) in the
Territory (as defined below) (the "Business").
Whereas, subject to the terms and conditions of this Agreement,
Seller desires to sell to Buyer, and Buyer desires to purchase from Seller, the
Purchased Assets (as defined below).
AGREEMENT
Now, Therefore, in consideration of the premises and the mutual
covenants and promises contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which hereby are acknowledged, the
Parties agree as follows:
ARTICLE I. DEFINITIONS
SECTION 1.01 DEFINED TERMS.
As used in this Agreement, the following defined terms have the
meanings described below:
"Action or Proceeding" means any action, suit, proceeding,
arbitration, Order, inquiry, hearing, assessment with respect to
fines or penalties, or litigation (whether civil, criminal,
administrative, investigative or informal) commenced, brought,
conducted or heard by or before, or otherwise involving, any
Governmental or Regulatory Authority.
"Affiliate" means, with respect to any Person, another Person that
directly, or indirectly through one or more intermediaries,
controls, is controlled by or is under common control with such
Person. "Control" and, with correlative meanings, the terms
"controlled by" and "under common control with" means 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, resolution, regulation or otherwise.
"Assumed Liabilities" means exclusively the following Liabilities:
(i) all accounts payable incurred by Seller in the Ordinary Course
of Business in connection with the Business prior to the Closing, to
the extent relating to goods, services, assets or other benefits to
be provided to the Business on or after the Closing; (ii) all
Liabilities and obligations that Buyer has expressly assumed or
agreed to assume under this Agreement and the Interim Supply
Agreement, each of even dates herewith; (iii) Seller's obligations
under the Federal Supply Schedule and Section 340B of the Public
Health Services Act to supply the Products at the respective prices
therein; and (iv) all other Liabilities and obligations that arise
out of the ownership or use or operation of the Purchased Assets
(including the Regulatory Approvals), the Business or the Products,
attributable in whole or in relevant part to occurrences and
circumstances arising on or after the Closing Date.
"Assumption Agreement" means the Assumption Agreement to be executed
at Closing by Seller and Buyer, in the form attached hereto as
Exhibit A.
"▇▇▇▇ of Sale and Assignment" means the ▇▇▇▇ of Sale and Assignment
to be executed at Closing by Seller and Buyer, in the form attached
hereto as Exhibit B.
"Books and Records" means all files, documents, instruments, papers,
books and records (including scientific and financial) of Seller to
the extent relating to the Purchased Assets, Products or Business,
including any pricing lists, quotations, proposals, customer lists
(to the extent owned by Seller), information pertaining to sales of
Products (including to doctors, general purchasing organizations and
pharmacists), vendor lists, financial data, regulatory information
or files (including adverse event reports and annual regulatory
reports), litigation files, patent prosecution files, adverse claims
or demands, investigation information or files, market research,
marketing plans, media plans, advertising, clinical study results
pertaining to marketing of Products or to planned, current, past or
Terminated terbutaline sulfate products, form letters and medical
queries, sales training materials, trademark registration
certificates, trademark renewal certificates, and other
documentation to the extent relating to the Product Intellectual
Property, the Products, the Business, the Purchased Assets or the
Regulatory Approvals, but excluding any such items (i) to the extent
that any applicable Law prohibits their transfer, (ii) to the extent
that any transfer thereof would cause Seller to violate
confidentiality provisions thereunder, (iii) received from
third-parties in connection with their acquisition of the Purchased
Assets, the Products or Business, or (iv) specifically prepared by
Seller for the negotiation of this Agreement.
"Business" has the meaning set forth in the recitals to this
Agreement.
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"Business Day" means a day other than Saturday, Sunday or any day on
which banks located in New York or Charlotte are authorized or
obligated to close.
"Buyer Disclosure Schedule" has the meaning set forth in the
preamble of Article VII to this Agreement.
"Closing" has the meaning set forth in Section 5.01.
"Closing Date" has the meaning set forth in Section 5.01.
"Confidentiality Agreement" has the meaning set forth in Section
10.01(f).
"Contract" means any and all legally binding commitments, contracts,
leases, indentures, purchase orders, leases, or other agreements,
whether written or oral, including all amendments thereto.
"Corporate Names" has the meaning set forth in Section 8.04(a).
"Damages" has the meaning set forth in Section 9.02(a).
"Derivative Brethine Products" means any new pharmaceutical products
developed by, or on behalf of, Buyer containing terbutaline sulfate
as an active pharmaceutical ingredient, either alone or in
combination with another active pharmaceutical ingredient, and based
on, or derived from, in whole or in part, the Products and
introduced and sold in the Territory.
"Encumbrance" means any mortgage, pledge, security interest, deed of
trust, lease, lien, adverse claim, levy, charge, easement, right of
way, covenant, restriction, or other encumbrance, third-party right
or retained right of any kind whatsoever, or any conditional sale or
title retention agreement or other agreement to give any of the
foregoing in the future.
"Excluded Intellectual Property" means (i) Seller Trademarks, (ii)
Seller Trade Dress, and (iii) any intellectual property of Seller
other than Product Intellectual Property.
"FDA" means the United States Food and Drug Administration.
"Finished Goods" means any Products packaged and ready for
distribution to the ultimate customer for such Products.
"Governmental or Regulatory Authority" means any court, tribunal,
arbitrator, authority, agency, commission, official or other
instrumentality of the United States, or of any state, county, city
or other political subdivision therein.
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"Guaranty Agreement" means the Guaranty Agreement of even date
herewith, in the form attached hereto as Exhibit C.
"INDs" means Investigational New Drug applications filed with the
FDA, and all supplements, amendments and revisions thereto.
"Indemnification Claim Notice" has the meaning set forth in Section
9.02(c).
"Indemnified Party" has the meaning set forth in Section 9.02(c).
"Indemnitee" and "Indemnitees" have the respective meanings set
forth in Section 9.02(c).
"Interim Supply Agreement" means the Interim Supply Agreement of
even date herewith, in the form attached hereto as Exhibit D.
"Inventory" means all inventory located in the Territory of Finished
Goods owned as of the Closing by Seller thereof, whether held at a
location or facility of Seller (or of any other Person on behalf of
Seller) or in transit to or from Seller (or any such other Person).
"Know-How" means all Product specifications; manufacturing, physical
chemistry and formulation know-how; analytical testing methods and
validations; technical knowledge; expertise; skill; practices and
procedures; formulae; trade secrets; inventions; confidential
information; analytical methodology; processes; methods;
preclinical, clinical, stability and other data and results; market
studies; and all other experience and know-how, in each case in
tangible form and to the extent related to the Products in the
Territory, whether or not patentable.
"Knowledge" with respect to any Party, means the actual knowledge of
the officers (or persons performing similar functions) or in-house
attorneys of such Person, after reasonable inquiry.
"Law" means any U.S. federal, state or local law, statute or
ordinance, or any rule, regulation, or published guidelines
promulgated by any Governmental or Regulatory Authority, including
all regulations and guidances of the FDA (including its current good
manufacturing practices, or cGMP).
"Liability" means any obligations, debts or liability (whether known
or unknown, asserted or unasserted, absolute or contingent, accrued
or unaccrued, liquidated or unliquidated, matured or unmatured,
determinable or undeterminable, and due or to become due), including
any of the foregoing arising under any Contract, Law or Order or in
or as a result of any Action or Proceeding, and any liability for
Taxes (whether arising under Treasury Regulation Section 1.1502-6 or
otherwise).
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"License Agreement" shall mean the License Agreement of even date
herewith, in the form attached hereto as Exhibit E.
"Managed Care Contracts" means the agreements related to the sale of
Products in the United States to certain managed care accounts set
forth in Section 8.08(d) of the Seller Disclosure Schedule.
"Marketing Materials" means all marketing and promotional materials
used solely and exclusively with respect to the marketing and sale
of the Products in the Territory that are in existence as of the
Closing Date to the extent such materials are within the possession
of Seller.
"Material Adverse Effect" means an effect or condition which,
individually or in the aggregate with other adverse effects, is
materially adverse to (i) the Purchased Assets taken as a whole;
(ii) the Business taken as a whole; or (iii) the Products and the
Regulatory Approvals taken individually; but shall not include (a)
any adverse effect due to changes in conditions generally affecting
(1) the healthcare industry or (2) the United States economy as a
whole, (b) any change or adverse effect caused by, or relating to,
the announcement of this Agreement and the transactions contemplated
by this Agreement or (c) any adverse effect due to changes in Law.
"Medicaid Reimbursements and Rebates" means all state and federal
Medicaid credits, chargebacks, utilization based or other rebates,
reimbursements, refunds, discounts, allowances, and similar payments
related to the Products.
"NDC Numbers" means, collectively, the national drug code numbers
associated with the Products.
"Order" means any writ, judgment, decree, injunction or similar
order of any Governmental or Regulatory Authority (in each such case
whether preliminary or final).
"Ordinary Course of Business" means such action that is consistent
with the ordinary-course past practices of the Business.
"Other Rebates" means all credits, chargebacks, utilization based or
other rebates, reimbursements, refunds, discounts, allowances, and
similar payments to wholesalers and other distributors, buying
groups, insurers and other institutions related to the Products,
other than Medicaid Reimbursements and Rebates.
"Party" means each of Buyer and Seller.
"Patents" means all U.S. and other patents, patent applications, and
statutory invention registrations (which, for the purpose of this
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Agreement, shall be deemed to include provisional applications and
invention disclosures), including reissues, divisions,
continuations, continuations-in-part, supplementary protection
certificates, extensions and reexaminations thereof, all inventions
disclosed therein, all rights provided by international treaties and
conventions, and all rights to obtain and file for patents and
registrations thereto.
"Permitted Encumbrance" means (i) any Encumbrance for Taxes,
assessments and other governmental charges not yet due and payable
or that may thereafter be paid without penalty, or that are being
contested in good faith by appropriate proceedings and (ii) any
imperfection of title or other Encumbrance that, individually or in
the aggregate with other such imperfections and Encumbrances, would
not have a Material Adverse Effect.
"Person" means any natural person, corporation, general partnership,
limited partnership, limited liability company, joint venture,
proprietorship, other business organization, trust, union,
association, or other entity, or any Governmental or Regulatory
Authority.
"Product" or "Products" means each and both of the following forms
of terbutaline sulfate products, marketed and sold under the
trademark "Brethine(R)", in all dosage strengths: (i) Brethine(R)
tablets and (ii) Brethine(R) intravenous ampules.
"Product Intellectual Property" means any and all of the following
intellectual property rights owned by Seller in the Territory that
are used or useful solely and exclusively in the manufacture, sale,
use, marketing and distribution of the Products (including all
pending or Terminated derivatives, improvements or variations
thereof or other pending or Terminated terbutaline sulfate products
as of the Closing Date): (i) Patents; (ii) Know-How; (iii)
copyrights in any copyrightable Marketing Material; (iv) the Product
Trademarks; and (v) the Product Trade Dress.
"Product Trademarks" means the U.S. Trademarks set forth in Section
1.01 of the Seller Disclosure Schedule.
"Product Trade Dress" means the current trade dress of any Product,
but excluding the Seller Trade Dress.
"Purchase Price" has the meaning set forth in Section 4.01.
"Purchased Assets" means the following, and only the following,
solely and exclusively in the Territory: (i) all rights, title and
interest in and to the Products and all pending or Terminated
derivatives, improvements or variations thereof and pending or
Terminated terbutaline sulfate products existing as of the Closing
Date, including all rights to the marketing, sale, distribution and
manufacturing thereof, in the Territory; (ii) the Regulatory
6
Approvals; (iii) the Product Intellectual Property; (iv) the
Marketing Materials; (v) the Books and Records; and (vi) all
unfilled customer orders for Finished Goods as of the Closing Date
(a list of such orders to be provided to Buyer within ten (10)
Business Days after the Closing Date). The Purchased Assets do not
include the Retained Assets.
"Registered Intellectual Property" means the Product Trademarks
registered or filed in the United States.
"Regulatory Approvals" means, with respect to the Products, the New
Drug Application for such Products identified in Section 6.10 of the
Seller Disclosure Schedule, all amendments, revisions and
supplements thereto and the official regulatory files and data in
Seller's possession or control as of the Closing relating thereto,
including all regulatory and clinical files and data for other
pending, planned or Terminated development projects for terbutaline
sulfate products.
"Retained Assets" means all assets of Seller and its Affiliates
except the Purchased Assets. For purposes of clarity and not of
limitation, "Retained Assets" shall include (a) the Excluded
Intellectual Property, (b) Inventory (which will be purchased under
the terms of the Interim Supply Agreement) and all plant, equipment
and fixed assets of Seller and its Affiliates and (c) all assets of
Seller and its Affiliates outside the Territory.
"Retained Liabilities" means all Liabilities of Seller except the
Assumed Liabilities.
"Seller Disclosure Schedule" has the meaning set forth in the
preamble to Article VI of this Agreement.
"Seller Trademarks" means (i) the names "Geigy," "Novartis",
"Novartis Pharmaceuticals Corporation" and "Novartis Corporation"
and all variations, formatives, derivatives and colorable imitations
of any of the foregoing, and (ii) all other Trademarks of Seller,
other than the Product Trademarks, currently used by Seller in
connection with the manufacture, marketing, sale and distribution of
the Products.
"Seller Trade Dress" means (i) the stripes, bands and coloring used
on the packaging or ampule of any Product, and (ii) the tablet,
capsule or ampule shape and coloring of any Product, in each case to
the extent used on other Seller product packaging or for the
tablets, capsules or ampules of other Seller products.
"Tax" means all of the following taxes in connection with the
operations of the Business or the transactions contemplated hereby:
(i) any net income, alternative or add-on minimum tax, gross income,
gross receipts, sales, use, ad valorem, transfer, franchise,
profits, license, excise, severance, stamp, occupation, premium,
property, environmental or
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windfall profit tax, custom, duty or other tax, governmental fee or
other like assessment imposed by an governmental, regulatory or
administrative entity or agency responsible for the imposition of
any such tax in the Territory; (ii) any Liability for the payment of
any amounts of the type described in (i) above as a result of being
a member of any affiliated, consolidated, combined, unitary or other
group for any Taxable period; and (iii) any Liability for the
payment of any amounts of the type described in (i) or (ii) above as
a result of any express or implied obligation to indemnify any other
Person.
"Terminated," with respect to (i) any derivative, improvement or
variation of a Product or (ii) any other pharmaceutical product
utilizing terbutaline sulfate as an active ingredient, means any
such derivative, improvement, variation or terbutaline sulfate
product, the manufacture, sale or development of which was
terminated in the Territory by Seller during the preceding
continuous twenty-four (24) month period ending on the Closing Date.
"Territory" means the United States.
"Third Party Claim" has the meaning set forth in Section 9.02(d).
"Trademarks" means all U.S. and other trademarks, trade names, brand
names, logotypes, symbols, service marks, designs, trade names and
the goodwill of the business symbolized thereby and all renewals,
modifications and extensions thereof.
"Trademark Assignment Agreement" shall mean the Trademark Assignment
Agreement to be executed at Closing by Novartis Corp. and Buyer, in
the form attached hereto as Exhibit F.
"Transition Team" has the meaning set forth in Section 8.10.
"United States" or "U.S." means the United States of America, its
territories and possessions, including Washington, D.C. and Puerto
Rico.
SECTION 1.02 CONSTRUCTION OF CERTAIN TERMS AND PHRASES.
Unless the context of this Agreement otherwise requires, when used
in this Agreement: (a) words of any gender include each other gender; (b) words
using the singular or plural number also include the plural or singular number,
respectively; (c) the terms "hereof," "herein," "hereto", "hereby" and
derivative or similar words refer to this entire Agreement; (d) the terms
"Article" or "Section" refer to the specified Article or Section of this
Agreement; (e) the term "or" has, except where otherwise indicated, the
inclusive meaning represented by the phrase "and/or"; (f) the term "including",
"include" or "includes" shall be deemed to be followed by "without limitation";
(g) the word "primarily" shall be deemed to be followed by the words "or
exclusively"; (h) references to any recitals, Articles, Sections, Exhibits,
Schedules or Appendices shall be deemed to
8
refer to the recitals, Articles, Sections, Exhibits, Schedules or Appendices
hereof; and (i) references to currency means U.S. Dollars. Whenever this
Agreement refers to a number of days, such number shall refer to calendar days
unless Business Days are specified. This Agreement shall be deemed to be drafted
jointly by all the Parties and shall not be specifically construed against any
Party hereto based on any claim that such Party or its counsel drafted this
Agreement.
ARTICLE II. PURCHASE AND SALE OF PURCHASED ASSETS
SECTION 2.01 PURCHASE AND SALE OF PURCHASED ASSETS.
(a) Subject to the terms and conditions of this Agreement, at the
Closing, Seller shall sell, transfer, convey, assign and deliver to Buyer, free
and clear from all Encumbrances other than Permitted Encumbrances, and Buyer
shall purchase, acquire and accept from Seller, all of Seller's right, title and
interest, as of the Closing, in and to the Purchased Assets. (In the event,
following the Closing, that Seller or Buyer discovers that any of the Purchased
Assets were held at the time of Closing by any Affiliate of Seller and not
transferred to Buyer at the Closing, Seller shall cause the transfer thereof to
Buyer or Buyer's designee as promptly as commercially practicable after such
discovery.)
(b) Notwithstanding anything contained in this Agreement to the
contrary, (i) from and after the Closing, Seller and its Affiliates shall retain
all of their right, title and interest in and to the Retained Assets (subject to
Buyer's rights under the License Agreement of even date herewith); and (ii)
Seller may retain a copy of all Books and Records, Marketing Materials and other
documents or materials conveyed hereunder for archival purposes, for purposes of
fulfilling its obligations under applicable Law and for purposes of performing
its obligations under the Interim Supply Agreement (and for no other uses or
purposes, including for filing, or providing to others to file, for future New
Drug Applications or INDs for pharmaceutical products in which terbutaline
sulfate is the sole or primary active ingredient).
ARTICLE III. ASSUMPTION OF LIABILITIES
SECTION 3.01 ASSUMPTION OF ASSUMED LIABILITIES.
Subject to the terms and conditions of this Agreement, as of the
Closing Date and effective upon the Closing, Buyer agrees to assume, satisfy,
perform, pay and discharge the Assumed Liabilities, when and as due. For
purposes of clarity and not of limitation, Buyer and its Affiliates are not
assuming, and shall not be liable for, any Retained Liabilities.
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ARTICLE IV. PURCHASE PRICE AND PAYMENT
SECTION 4.01 PURCHASE PRICE.
As consideration for the Purchased Assets, Buyer shall:
(a) deliver or cause to be delivered to Seller at the Closing, the
sum of $26.6 million (the "Purchase Price") in immediately available funds
by wire transfer into a bank account or accounts designated by Seller two
Business Days before the Closing; and
(b) assume the Assumed Liabilities at the Closing pursuant to the
Assumption Agreement in the form of Exhibit A hereto.
SECTION 4.02 ALLOCATION OF PURCHASE PRICE.
The Purchase Price shall be allocated among the Purchased Assets as
of the Closing Date in accordance with applicable law and as set forth in
Section 4.02 of the Seller Disclosure Schedule hereto. Buyer and Seller agree
(a) to report the transactions contemplated by this Agreement for Tax purposes
in accordance with the allocations set forth on Schedule 4.02 hereto and (b) not
to take any position inconsistent with such allocations on any of their
respective Tax returns, in any Tax refund claim, in any litigation or otherwise,
unless otherwise required by applicable Law.
SECTION 4.03 PAYMENT OF SALES, USE AND OTHER TAXES.
Seller and Buyer shall each be responsible for 50% of all sales,
use, stamp duty, transfer, value added and other related or similar Taxes, if
any, arising out of the sale by Seller of the Purchased Assets to Buyer pursuant
to this Agreement or payable in connection with the transactions contemplated
hereby.
ARTICLE V. CLOSING
SECTION 5.01 TIME AND PLACE.
The closing of the transactions contemplated by this Agreement,
including the purchase and sale of the Purchased Assets and the assumption of
the Assumed Liabilities (the "Closing"), shall take place on the date hereof, at
the offices of ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ LLP in New York, NY, (the "Closing Date").
SECTION 5.02 DELIVERIES AT CLOSING.
(a) Closing Deliveries by Seller. At or as part of the Closing, Seller
shall deliver or cause to be delivered to Buyer:
(i) physical possession (or implement arrangements satisfactory to Buyer
of transfer and delivery of physical possession) of all tangible
personal property included in the Purchased Assets,
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including, (A) all tangible personal property included in the
Regulatory Approvals and (B) the Marketing Materials and the Books
and Records to the extent relating to the Purchased Assets, and
appropriate documents of transfer related thereto in form and
substance reasonably acceptable to Seller and Buyer, provided that
Seller's obligation to deliver such Books and Records and Marketing
Materials shall be satisfied by its good faith and commercially
reasonable efforts to locate and deliver all of such Books and
Records and Marketing Materials at the Closing, and provided further
that in the event that, following the Closing, Seller or Buyer
discover that any Books and Records to the extent relating to the
Purchased Assets and Marketing Materials have not yet been delivered
to Buyer, Seller shall deliver such additional Books and Records and
Marketing Materials promptly to Buyer;
(ii) a duly executed counterpart of the Assumption Agreement in the form
of Exhibit A hereto;
(iii) a duly executed Trademark Assignment Agreement in the form of
Exhibit F hereto;
(iv) a duly executed ▇▇▇▇ of Sale and Assignment in the form of Exhibit B
hereto;
(v) a certificate of insurance in accordance with Section 8.12(a);
(vi) a duly executed counterpart of the Interim Supply Agreement in the
form of Exhibit D hereto;
(vii) a duly executed counterpart of the License Agreement in the form of
Exhibit E hereto;
(viii) a duly executed counterpart of the Guaranty Agreement; and
(ix) such other documents, instruments and certificates as Buyer and
Seller may mutually agree upon.
(b) Closing Deliveries by Buyer. At the Closing, Buyer shall deliver or
cause to be delivered to Seller:
(i) the Purchase Price, in immediately available funds by wire transfer
into a bank account or accounts designated by Seller;
(ii) a duly executed counterpart of the Assumption Agreement in the form
of Exhibit A hereto;
(iii) a duly executed counterpart of the Interim Supply Agreement in the
form of Exhibit D hereto;
11
(iv) a duly executed counterpart of the License Agreement in the form of
Exhibit E hereto;
(v) a certificate of insurance pursuant to Section 8.12(b);
(vi) such other documents, instruments and certificates as Buyer and
Seller may mutually agree upon;
(vii) a duly executed counterpart of the Guaranty Agreement; and
(viii) the Inventory Purchase Order and the Initial Purchase Order (each
as defined in the Interim Supply Agreement).
ARTICLE VI. REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represents and warrants to Buyer, subject to such exceptions
as are set forth in the disclosure schedule attached hereto (the "Seller
Disclosure Schedule"), as follows:
SECTION 6.01 ORGANIZATION.
Each individual entity constituting Seller is a corporation duly
organized, validly existing and in good standing under the laws of the state of
its incorporation and has all requisite power and authority to own the Purchased
Assets owned by it and carry on the Business as currently conducted by it. Each
individual entity constituting Seller is duly qualified to conduct its business
and is in good standing in each jurisdiction where the nature of such business
requires such qualification, except for any jurisdiction where failure to so
qualify would not have a Material Adverse Effect or materially impair or delay
Seller's ability to perform its obligations hereunder.
SECTION 6.02 AUTHORITY OF SELLER.
Each individual entity constituting Seller has all necessary power
and authority to enter into this Agreement and to carry out the transactions
contemplated hereby. Each individual entity constituting Seller has taken all
action required by Law, its certificate of incorporation, by-laws or otherwise
to be taken by it to authorize the execution and delivery of this Agreement by
Seller and the consummation of the transactions contemplated hereby. This
Agreement has been duly and validly executed and delivered by Seller and, when
duly authorized, executed and delivered by Buyer, will constitute a legal, valid
and binding obligation of Seller enforceable against it in accordance with its
terms except (a) as limited by applicable bankruptcy, insolvency,
reorganization, fraudulent conveyance, moratorium and other laws of general
application affecting enforcement of creditors' rights generally, and (b) as
limited by laws relating to the availability of specific performance, injunctive
relief or other equitable remedies or by general principles of equity.
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SECTION 6.03 CONSENTS AND APPROVALS.
No consents, waivers, approvals, Orders or authorizations of, or
registrations, declarations or filings with, any Governmental or Regulatory
Authority, or by any customer, supplier or other third party, are required by or
with respect to Seller in connection with the execution and delivery of this
Agreement by Seller or the performance of its obligations hereunder, except for
such consents, waivers, approvals, Orders or authorizations the failure to
obtain which, and such registrations, declarations or filings the failure to
make which, would not have a Material Adverse Effect or materially impair or
delay Seller's ability to perform its obligations hereunder.
SECTION 6.04 NON-CONTRAVENTION.
The execution and delivery by Seller of this Agreement does not, and
the performance by it of its obligations under this Agreement and the
consummation of the transactions contemplated hereby will not:
(a) conflict with or result in a violation or breach of any of the
terms, conditions or provisions of the certificate of incorporation,
by-laws, or other organizational documents of Seller, other than such
conflicts, violations or breaches as would not have a Material Adverse
Effect; or
(b) assuming the receipt of all consents, waivers, approvals, Orders
or authorizations of Governmental and Regulatory Authorities required to
be obtained by Seller and the making of all registrations, declarations or
filings with Governmental and Regulatory Authorities required to be made
by Seller, conflict with or result in a violation or breach of any term or
provision of any Law applicable to Seller, the Business, the Products or
the Purchased Assets, other than such conflicts, violations or breaches as
would not have a Material Adverse Effect.
SECTION 6.05 MATERIAL CONTRACTS.
Except as set forth in Section 6.05 of the Seller Disclosure
Schedule, Seller is not a party to any contracts pertaining to the Territory
with a value in excess of $250,000 and that relate to (i) the manufacture,
marketing, sale or distribution of any of the Products; (ii) the acquisition,
sale, licensing in or out, or assignment of Product Intellectual Property; (iii)
the purchase or disposition of assets, or the provision of services, to or from
the Business; or (iv) sales of Products to any Governmental or Regulatory
Authority.
SECTION 6.06 INTELLECTUAL PROPERTY RIGHTS.
(a) Section 6.06(a) of the Seller Disclosure Schedule sets forth a
complete and correct list of all Registered Intellectual Property. Except as set
forth in Section 6.06(a) of the Seller Disclosure Schedule, Seller owns all
right, title and interest in and to, or has a license, sublicense or other
permission to use, and is legally entitled to transfer to Buyer, all of the
Registered Intellectual Property, free and clear of all
13
Encumbrances, except Permitted Encumbrances. All necessary registration,
maintenance and renewal fees due in connection with such Registered Intellectual
Property have been paid and all necessary documents and certificates in
connection with such Registered Intellectual Property have been filed with the
relevant patent, copyright or trademark office or other Governmental or
Regulatory Authorities for the purposes of maintaining such Registered
Intellectual Property, except where the failure to file such registration,
maintenance and renewal fees will not have a Material Adverse Effect or a
material adverse effect on any of the Trademarks included in the Registered
Intellectual Property.
(b) Seller owns all right, title and interest in and to, and is
legally entitled to transfer to Buyer, all of the Product Intellectual Property,
free and clear of all Encumbrances, except Permitted Encumbrances, except where
the failure to own any such right, title and interest or have any such license,
sublicense or other permission to use will not have a Material Adverse Effect.
(c) To the Knowledge of Seller, the operations of the Business as
currently conducted, and the Products, do not infringe or misappropriate the
intellectual property rights of any third party (except where any such
infringement or misappropriation would not have a Material Adverse Effect), and
Seller has not received any written notice from any Person of any claims of
infringement or misappropriation with respect thereto (except where any such
infringement or misappropriation would not have a Material Adverse Effect). To
the Knowledge of Seller, such operations (including any methods of preparing and
analyzing the Products) and the Products do not infringe or utilize any Patents
of Seller or its Affiliates, other than those, if any, licensed to Buyer
pursuant to the License Agreement of even date herewith.
(d) All trademarks included in the Registered Intellectual Property
are the subject of current registrations and have been continuously used for the
uses specified in their trademark registrations since the first commercial sale
of the Products in the Territory. There are no third-party rights in Seller's
current registrations relating to the Product Trademarks. Seller has no
Knowledge of any prior use, infringement, piracy or counterfeiting of such
Product Trademarks, any superior rights by any third party in such Product
Trademarks, or any adverse claims pertaining to such Product Trademarks.
(e) Seller's Affiliates do not own any intellectual property rights
of the following types or natures in the Territory that are used solely and
exclusively in the manufacture, sale, use, marketing and distribution of the
Products (including all pending or Terminated derivatives, improvements or
variations thereof or other pending or Terminated terbutaline sulfate products
existing as of the Closing Date): (i) Patents; (ii) Know-How; (iii) copyrights
in any copyrightable Marketing Material; (iv) the Product Trademarks; (v) the
Product Trade Dress.
SECTION 6.07 LITIGATION.
Except as set forth in Section 6.07 of the Seller Disclosure
Schedule, there are no Actions or Proceedings pending or, to the Knowledge of
Seller, threatened or reasonably anticipated against Seller or its Affiliates in
the Territory that relate to (a) the
14
Purchased Assets or the Business; (b) this Agreement; (c) the transactions
contemplated by this Agreement; or (d) the Products or Regulatory Approvals,
which if adversely determined would have a Material Adverse Effect. Seller is
not subject to any Order that could reasonably be expected to materially impair
or delay the ability of Seller to perform its obligations hereunder.
SECTION 6.08 COMPLIANCE WITH LAW.
Except as set forth in Section 6.10 below, since January 1, 1999,
Seller has operated the Business substantially in compliance with all applicable
Laws, except where failure to so comply would not have a Material Adverse
Effect, and Seller has not received any written notice alleging any violation of
such Laws since January 1, 1999.
SECTION 6.09 TITLE TO PURCHASED ASSETS.
Seller at Closing has good and marketable title to the Purchased
Assets, free and clear of any Encumbrances other than Permitted Encumbrances,
and has the legal right and ability to transfer the Purchased Assets to Buyer
subject to the Permitted Encumbrances.
SECTION 6.10 REGULATORY MATTERS.
(a) Except as would not have a Material Adverse Effect, all of the
Regulatory Approvals are current and in full force and effect, have been duly
and validly issued, contain no material error or omission, and are owned
exclusively by Seller. All Products are covered by a Regulatory Approval that
permits sale of such Product in the Territory. Except as set forth in Section
6.10 of the Seller Disclosure Schedule or as would not have a Material Adverse
Effect, there is no Action or Proceeding by any Governmental or Regulatory
Authority pending or, to the Knowledge of Seller, threatened seeking the recall
of any Products or the revocation or suspension of any Regulatory Approval.
Seller has made available to Buyer complete and correct copies of all Regulatory
Approvals.
(b) Except as set forth in Section 6.10 of the Seller Disclosure
Schedule, during the three years prior to the date of this Agreement, Seller has
not received or been subject to: (i) any FDA Form 483's relating to any Product
or any facility in which such Product is manufactured; (ii) any FDA Notices of
Adverse Findings relating to any Product; or (iii) any warning letters or other
written correspondence from the FDA or any other Governmental or Regulatory
Authority concerning any Product in which the FDA or such other Governmental or
Regulatory Authority asserted that the operations of Seller were not in
compliance with applicable Law with respect to any Product or the facilities in
which any Product is manufactured, tested or stored.
(c) Set forth on Section 6.10 of the Seller Disclosure Schedule are
the permits, licenses, registrations and other approvals which are necessary for
the registration, marketing, promotion, distribution and sale of the Products in
the Territory in the manner conducted by Seller prior to the Closing.
15
(d) During the last three years, there has not been any occurrence,
nor is there under consideration or investigation by Seller, of any product
recall conducted by or on behalf of Seller concerning any Product or, to the
Knowledge of Seller, any product recall conducted by or on behalf of any other
entity as a result of any alleged defect in any Product.
SECTION 6.11 BROKERS.
Seller has not retained any broker in connection with the
transactions contemplated hereunder. Buyer has no, and will have no, obligation
to pay any brokers, finders, investment bankers, financial advisors or similar
fees in connection with this Agreement or the transactions contemplated hereby
by reason of any action taken by or on behalf of Seller.
SECTION 6.12 NO NON-COMPETITION AGREEMENTS OR PREFERENTIAL
OBLIGATIONS.
The Purchased Assets are not subject to any non-competition
agreements with, or other agreements granting preferential rights to purchase or
license the Purchased Assets to, any third Persons.
SECTION 6.13 ORDINARY COURSE.
From July 31, 2001 to the Closing Date, sales of the Products have
not been in volumes greater than in the Ordinary Course of Business for
comparable historical periods.
SECTION 6.14 EXCLUSIVE REPRESENTATIONS AND WARRANTIES.
Other than the representations and warranties set forth herein,
Seller is not making any other representation or warranty, express or implied,
with respect to the Products or the Purchased Assets. BUYER ACKNOWLEDGES THAT NO
REPRESENTATIONS HAVE BEEN MADE OTHER THAN AS SPECIFICALLY SET FORTH IN THIS
AGREEMENT. BUYER HEREBY WAIVES, TO THE EXTENT PERMITTED BY LAW, ANY AND ALL
IMPLIED WARRANTIES. NO ORAL WARRANTIES, REPRESENTATIONS OR STATEMENTS SHALL BE
CONSIDERED A PART HEREOF.
ARTICLE VII. REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Seller, subject to such exceptions
as are set forth in the disclosure schedule attached hereto (the "Buyer
Disclosure Schedule"), as follows:
SECTION 7.01 CORPORATE ORGANIZATION.
Buyer is a corporation duly organized, validly existing and in good
standing, under the laws of the jurisdiction of its incorporation and has all
requisite power
16
and authority to own its assets and carry on its business as currently conducted
by it. Buyer is duly qualified to conduct its business and is in good standing
in each jurisdiction where the nature of the business conducted by it requires
such qualification, except for any jurisdiction where failure to so qualify
could not reasonably be expected, individually or in the aggregate, to have a
material adverse effect on or materially impair or delay Buyer's ability to
perform its obligations hereunder.
SECTION 7.02 AUTHORITY OF BUYER.
Buyer has all necessary power and authority to enter into this
Agreement and to carry out the transactions contemplated hereby. The Board of
Directors of Buyer has taken all action required by Law, its organizational
documents, or otherwise to be taken by it to authorize the execution and
delivery of this Agreement by Buyer and the consummation of the transactions
contemplated hereby. This Agreement has been duly and validly executed and
delivered by Buyer and, when duly authorized, executed and delivered by Seller,
will constitute a legal, valid and binding obligation of Buyer enforceable
against it in accordance with its terms except (a) as limited by applicable
bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium and
other laws of general application affecting enforcement of creditors' rights
generally; and (b) as limited by laws relating to the availability of specific
performance, injunctive relief or other equitable remedies or by general
principles of equity.
SECTION 7.03 CONSENTS AND APPROVALS.
No consents, waivers, approvals, Orders or authorizations of, or
registrations, declarations or filings with, any Governmental or Regulatory
Authority are required by Buyer in connection with the execution and delivery of
this Agreement by Buyer or the performance of its obligations hereunder.
SECTION 7.04 NON-CONTRAVENTION.
The execution and delivery by Buyer of this Agreement does not, and
the performance by it of its obligations under this Agreement and the
consummation of the transactions contemplated hereby will not:
(a) conflict with or result in a violation or breach of any of the
terms, conditions or provisions of the certificate of incorporation,
by-laws or other organizational documents of Buyer;
(b) assuming the receipt of all consents, waivers, approvals, Orders
or authorizations of Governmental and Regulatory Authorities required to
be obtained by Buyer and the making of all registrations, declarations or
filings with Governmental and Regulatory Authorities required to be made
by Buyer, conflict with or result in a violation or breach of any term or
provision of any Law applicable to Buyer; or
(c) conflict with or result in a breach or default (or an event
which, with notice or lapse of time or both, would constitute a breach or
default) under,
17
or result in the termination or cancellation of, or accelerate the
performance required by, or result in the creation or imposition of any
security interest, lien or any other Encumbrance upon any Contract to
which Buyer is a party or by which Buyer or any of its assets is bound.
SECTION 7.05 LITIGATION.
There are no Actions or Proceedings pending or, to the Knowledge of
Buyer threatened or reasonably anticipated against Buyer which if adversely
determined would delay the ability of Buyer to perform its obligations
hereunder.
SECTION 7.06 BROKERS.
Buyer has not retained any broker in connection with the
transactions contemplated hereunder. Seller has no, and will have no, obligation
to pay any brokers, finders, investment bankers, financial advisors or similar
fees in connection with this Agreement or the transactions contemplated hereby
by reason of any action taken by or on behalf of Buyer.
SECTION 7.07 EXCLUSIVE REPRESENTATIONS AND WARRANTIES.
Other than the representations and warranties set forth herein,
Buyer is not making any other representation or warranty, express or implied.
SELLER ACKNOWLEDGES THAT NO REPRESENTATIONS HAVE BEEN MADE OTHER THAN AS
SPECIFICALLY SET FORTH IN THIS AGREEMENT. SELLER HEREBY WAIVES, TO THE EXTENT
PERMITTED BY LAW, ANY AND ALL IMPLIED WARRANTIES. NO ORAL WARRANTIES,
REPRESENTATIONS OR STATEMENTS SHALL BE CONSIDERED A PART HEREOF.
ARTICLE VIII. COVENANTS OF THE PARTIES
SECTION 8.01 COOPERATION.
Each Party shall reasonably cooperate with the other in preparing
and filing all notices, applications, submissions, reports and other instruments
and documents that are necessary, proper or advisable under applicable Laws to
consummate and make effective the transactions contemplated by this Agreement,
including Seller's reasonable cooperation in the efforts of Buyer to obtain any
consents and approvals of any Governmental or Regulatory Authority required for
Buyer to be able to sell the Products in the Territory.
SECTION 8.02 ACCESS.
(a) Upon the request of Seller, Buyer shall at all times following
the Closing, to the extent permitted by Law, grant to Seller and its
representatives the right, during normal business hours, to inspect and copy the
Books and Records and Marketing Materials and other documents obtained from
Seller in Buyer's possession, to the extent
18
pertaining to the operation of the Business prior to the Closing Date, for Tax
purposes and in connection with Actions or Proceedings (except as otherwise
stated in Section 8.02(b) below).
(b) Buyer agrees to keep and maintain all Books and Records and
Marketing Materials and other documents obtained from Seller in existence on the
Closing Date for a period of seven years and make personnel of Buyer or its
Affiliates available to Seller or its representatives to the extent such access
is reasonably related to any Retained Assets or otherwise necessary for Seller
to comply with the terms of this Agreement or comply with any applicable Law; it
being understood that Buyer and its personnel are not obligated to provide
access to any of Buyer's legally privileged information or documents hereunder
(other than the information or documents delivered or transferred to Buyer in
connection with the transactions contemplated herein).
SECTION 8.03 BULK SALES.
Buyer and Seller waive compliance with all bulk sales Laws
applicable to the transactions contemplated by this Agreement.
SECTION 8.04 CORPORATE NAMES.
(a) Except as set forth in this Section 8.04, following the Closing,
Buyer shall not have any rights by virtue of this Agreement or any of the
transactions or agreements contemplated hereby to any Seller Trademarks or
Seller Trade Dress or any other names, trademarks, trade names, trade dress or
logos relating to Seller or any of its products other than those included in the
Product Intellectual Property (collectively, the "Corporate Names").
(b) Buyer may use in connection with its operation of the Business
(i) items of inventory of the Products that bear any of the Corporate Names
(both Inventory and new inventory of Products manufactured during the period
after Closing during which Buyer is obtaining regulatory approvals to change the
labeling and stamping of the Products to remove the Corporate Names and to
obtain and use new dies to manufacture Product without such Corporate Names),
and (ii) Marketing Materials that were transferred to Buyer as Purchased Assets
that bear any of the Corporate Names, until the later of (A) the exhaustion of
such Inventory and Marketing Materials or (B) 6 months following the Closing (or
such shorter period as any relevant Governmental or Regulatory Authority shall
designate); provided, that Buyer shall use commercially reasonable best efforts
to cease using the Corporate Names and Marketing Materials, and to obtain the
foregoing regulatory approvals and new dies, as soon as commercially practicable
after the Closing Date; and provided, further, that, consistent with the
foregoing, Buyer and its Affiliates shall, and Buyer and its Affiliates shall
cause each of their distributors to, use commercially reasonable best efforts to
cease using the Corporate Names and exhaust the Product Inventory as soon as
practicable following the Closing Date. Notwithstanding the foregoing, upon
Buyer's receipt of the required regulatory approvals to change the stamping of
the Products to remove the Corporate Names, Buyer shall promptly destroy or
return to Seller any dies bearing the Corporate
19
Names then in the possession or control of Buyer or its Affiliates. Buyer
acknowledges and agrees that Seller shall have no Liability arising out of or in
connection with Buyer's or its Affiliate's use of the Corporate Names or the
Marketing Materials. Buyer shall not bear the economic burden of any labeling,
packaging or Marketing Materials in existence as of the Closing Date destroyed
by Buyer or Seller following Buyer's cessation of use of the Corporate Names.
Buyer agrees that any use thereby of the Corporate Names permitted under this
Section 8.04(b) shall be of a quality that equals or exceeds the standards of
quality applicable to use of such Corporate Names by Seller prior to the
Closing.
SECTION 8.05 ASSISTANCE IN COLLECTING CERTAIN AMOUNTS.
Seller shall remit as promptly as commercially practicable to Buyer
any payments or other sums received by Seller on or after the Closing Date that
relate to any sales or shipments of the Products made by Buyer on or after the
Closing Date and Seller shall use reasonable efforts to transmit to Buyer all
written inquiries or orders, and to refer to Buyer all oral inquiries or orders,
relating to the Business (to the extent relating to operations thereof following
the Closing) that are received by Seller on or after the Closing Date. From and
after the Closing Date, Buyer shall, and shall cause its Affiliates to, promptly
deliver to Seller any payments or other sums received from third parties that
relate to any sales or shipments of the Products made by Seller before the
Closing Date.
SECTION 8.06 DIFFERENTIATION OF PRODUCTS.
From and after the Closing, and as promptly as commercially
practicable, Buyer shall institute appropriate procedures to ensure that
products and goods of the Business, the Products and the Purchased Assets
manufactured, finished or sold by, or on behalf of, Buyer can be distinguished
from products and goods of the Business manufactured, finished or sold by, or on
behalf of, Seller and its Affiliates.
SECTION 8.07 REGULATORY MATTERS.
(a) From and after the transfer by Seller to Buyer of each
Regulatory Approval pursuant to the terms hereof, but consistent with Sections
8.01, 8.09 and 10.14 hereof, Buyer, at its cost, shall be solely responsible and
liable for (i) taking all actions, paying all fees and conducting all
communication with the appropriate Governmental or Regulatory Authority required
by Law in respect of such Regulatory Approval and its related Products,
including preparing and filing all reports (including adverse drug experience
reports) with the appropriate Governmental or Regulatory Authority; (ii) taking
all actions and conducting all communication with third parties in respect of
Products sold pursuant to such Regulatory Approval (whether sold before or after
transfer of such Regulatory Approval), including responding to all complaints
and medical inquiries in respect thereof, including complaints related to
tampering or contamination; and (iii) investigating all complaints and adverse
drug experiences in respect of Products sold pursuant to such Regulatory
Approval (whether sold before or after transfer of such Regulatory Approval).
20
(b) From and after the transfer by Seller to Buyer of each
Regulatory Approval pursuant to the terms hereof and subject to the terms of the
Interim Supply Agreement, Seller promptly shall notify Buyer if Seller receives
a complaint or a report of an adverse drug experience in respect of a Product
sold pursuant to such Regulatory Approval. In addition, with respect to each
Party's activities relating to the Products following the Closing, each Party
shall cooperate with the other Party's reasonable requests and use commercially
reasonable efforts to assist the requesting Party in connection with the
investigation of and response to any complaint or adverse drug experience
related to the Products. Any notification given by Seller within seventy-two
(72) hours of receipt of such complaint or report shall constitute "prompt"
notification for purposes of this Section 8.07(b). In addition, Seller shall
notify Buyer of any adverse drug experience or reaction reports or any other
reports or information indicating that any of the Products have any toxicity,
sensitivity reactions or are otherwise alleged to cause illness or injury of any
kind within seventy-two (72) hours of Seller's receipt of any such reports.
(c) From and after the transfer by Seller to Buyer of each
Regulatory Approval pursuant to the terms hereof, Buyer, at its cost, shall be
solely responsible and liable for conducting all voluntary and involuntary
recalls of units of Products sold pursuant to such Regulatory Approval (whether
sold before or after transfer of such Regulatory Approval), including recalls
required by any Governmental or Regulatory Authority and recalls of units of
Products sold by Seller deemed necessary by Seller in its reasonable discretion.
Seller promptly shall notify Buyer in the event that a recall of product sold by
Seller is necessary. All costs and Damages of such recalls with respect to
Products sold prior to the Closing shall be Retained Liabilities.
SECTION 8.08 PRODUCT RETURNS; REBATES; MANAGED CARE CONTRACTS.
(a) For the period from the Closing Date through one (1) year
thereafter, Seller shall bear the cost of returns of any Finished Goods which
Seller previously sold; provided, however, that such returns will be subject to
the requirement that (i) the Finished Goods being returned shall have expired or
(ii) the Finished Goods being returned are returned for reasons of
non-conformance with applicable Specifications (as defined in the Interim Supply
Agreement), and such returns are made within six (6) months of such expiration
or within six (6) months from the time such non-conformance is first discovered.
From and after such one (1) year period, Buyer shall be responsible for all
returns of Finished Goods, regardless of the date of sale or the seller thereof.
Neither Seller nor Buyer shall take any action to encourage, discourage or delay
the return of any Finished Goods.
(b) For the period from the Closing Date through seventy-five (75)
days thereafter, Seller shall bear the cost of all Medicaid Reimbursements and
Rebates for Finished Goods sold by Seller in the United States prior to the
Closing Date, in each case in accordance with Seller's then current practices;
provided, however, Buyer shall bear the additional costs of any Medicaid
Reimbursements and Rebates for Finished Goods in the United States during such
seventy-five (75) day period to the extent such costs exceed Seller's historical
Medicaid Reimbursements and Rebates resulting from
21
price increases or the setting of any new "best price", for Products established
by Buyer during such seventy-five (75) day period. From and after the date on
which such seventy-five (75) day post-closing period expires, Buyer shall bear
the cost of all Medicaid Reimbursements and Rebates for Finished Goods sold in
the United States, regardless of the date of sale, except that (i) Seller shall
at all times bear all Liability for Medicaid Reimbursements and Rebates
pertaining to sales of Products that can be reasonably identified as having been
made prior to the Closing to the extent that the claims pertaining to such
pre-Closing Medicaid Reimbursements and Rebates are based or asserted on civil
or criminal fraud, breach of covenant in contracts regarding federal or state
Medicaid obligations, or criminal violation and (ii) Buyer shall at all times
bear all Liability for Medicaid Reimbursements and Rebates pertaining to sales
of Products that can be reasonably identified as having been made on or after
the Closing to the extent that the claims pertaining to such post-Closing
Medicaid Reimbursements and Rebates are based or asserted on civil or criminal
fraud, breach of covenant in contracts regarding federal or state Medicaid
obligations, or criminal violation. For the avoidance of doubt, Seller shall be
entitled to any and all Medicaid refunds, credits and other adjustments relating
to the sale of Finished Goods prior to the Closing Date and Buyer shall be
entitled to any and all Medicaid refunds, credits and other adjustments relating
to the sale of Finished Goods on or after the Closing Date.
(c) Notwithstanding any other provision of this Agreement, following
the Closing Date, Seller shall be responsible for the administration of the
federal and state government rebate process for all Products which bear the NDC
Numbers associated with the Products as of the date hereof and Buyer shall be
responsible for the administration of such process for all Products which bear
the Buyer NDC Numbers. Seller, on the one hand, and Buyer, on the other hand,
shall each furnish the other Party with any information necessary for each
Party's performance of its administrative responsibilities pursuant to this
Section 8.08(c) in the form reasonably requested by the other Party, including,
without limitation, applicable pricing information. For so long as Seller is
responsible for the administration of the government rebate process for any
Products, Buyer shall provide Seller with the necessary information within 10
days of the close of each calendar quarter. Buyer shall pay Seller a reasonable
fee, in an amount and on terms to be mutually agreed by the Parties prior to
Closing, as compensation for Seller's performance of administrative services
pursuant to this Section 8.08(c).
(d) For the period from the Closing Date through thirty (30) days
thereafter, Seller shall be responsible for any payments, Other Rebates,
administrative fees or chargebacks due to customers under the Managed Care
Contracts set forth in Section 8.08(d) of the Seller Disclosure Schedule, as
well as any payments, Other Rebates, administrative fees or chargebacks due
under any state or federal program, regardless of the date of sale of the
Products. After expiration of such time period, Buyer shall be responsible for
any payments, Other Rebates, administrative fees or chargebacks due to customers
under any Managed Care Contracts or any state or federal program, regardless of
the date of sale of the Products.
22
SECTION 8.09 FURTHER ASSURANCES.
(a) On and after the Closing, Seller shall from time to time, at the
request of Buyer, execute and deliver, or cause to be executed and delivered,
such other instruments of conveyance and transfer and take such other actions as
Buyer may reasonably request, in order to more effectively consummate the
transactions contemplated hereby and to vest in Buyer good and marketable title
to the Purchased Assets (including assistance in the collection or reduction to
possession of any of the Purchased Assets).
(b) On and after the Closing, Buyer shall from time to time, at the
request of Seller, take such actions as Seller may reasonably request, in order
to more effectively consummate the transactions contemplated hereby, including
Buyer's assumption of the Assumed Liabilities.
SECTION 8.10 TRANSITION TEAM.
Seller and Buyer hereby agree to establish a transition team (the
"Transition Team") on the Closing Date, which shall consist of one Seller
designee and one Buyer designee, and maintain such Transition Team for a period
of forty-five (45) days from the Closing Date, to coordinate the actions, in
accordance with the terms and conditions of this Agreement, of Seller and Buyer.
SECTION 8.11 NDC NUMBERS.
As soon as practicable following the Closing Date, Buyer will
establish NDC Numbers (the "Buyer NDC Numbers") for the Product. Seller shall be
required to maintain and not discontinue any NDC Number associated with the
Products while Products labeled with Seller's NDC Numbers are still in
commercial distribution. No later than thirty (30) days after the introduction
of the Products labeled with the Buyer's NDC Numbers into commercial
distribution, Seller shall discontinue its NDC Numbers associated with such
Products.
SECTION 8.12 INSURANCE.
(a) At all times from the Closing Date through the later of (i)
December 31, 2007 and (ii) the expiration date for any Product supplied to Buyer
pursuant to the Interim Supply Agreement of even date herewith, Seller shall
maintain product liability insurance written on a claims-made basis in an amount
of not less than $5,000,000 annual aggregate. Seller shall provide Buyer with a
certificate of insurance on the Closing Date as evidence of such insurance and
annually thereafter evidencing the renewal of such insurance. Seller shall
promptly notify Buyer of any change in the terms of such insurance from those
set forth in the most recent certificate of insurance provided to Buyer pursuant
to this Section 8.12(a).
(b) At all times from the Closing Date through the later of (i)
December 31, 2007 and (ii) the expiration date for any Product supplied to Buyer
pursuant to the Interim Supply Agreement of even date herewith, Buyer shall
maintain
23
product liability insurance written on a claims-made basis in an amount of not
less than $5,000,000 annual aggregate. Buyer shall provide Seller with a
certificate of insurance on the Closing Date as evidence of such insurance and
annually thereafter evidencing the renewal of such insurance. Buyer shall
promptly notify Seller of any change in the terms of such insurance from those
set forth in the most recent certificate of insurance provided to Seller
pursuant to this Section 8.12(b).
ARTICLE IX. INDEMNIFICATION
SECTION 9.01 SURVIVAL OF REPRESENTATIONS, WARRANTIES, ETC.
All representations and warranties of Seller or Buyer contained in
this Agreement shall survive the Closing and remain in full force and effect for
a period of eighteen (18) months after the Closing Date. All such
representations and warranties, and all indemnification rights with respect to
breaches thereof, shall terminate eighteen (18) months after the Closing Date;
provided that if notice of any claim for indemnification pursuant to Section
9.02(a)(ii) or 9.02(b)(ii) shall have been given prior to the expiration of such
eighteen-month period, such claim shall survive until such time as it is finally
resolved. The covenants and agreements of the Parties contained in this
Agreement, and all indemnification rights with respect to breaches thereof,
shall survive and remain in full force and effect for the applicable periods
described herein or, if no such period is specified, indefinitely; provided that
if notice of any claim for indemnification pursuant to Section 9.02(a)(i) or
9.02(b)(i) shall have been given prior to the expiration of the relevant
underlying covenant or agreement, such claim shall survive until such time as it
is finally resolved. The provisions of this Section 9.01 shall survive for so
long as any other Section of this Agreement shall survive.
SECTION 9.02 INDEMNIFICATION.
(a) By Seller. Following the Closing, Seller shall indemnify,
reimburse, and hold harmless Buyer, its Affiliates, and their respective
officers, directors, employees, agents, successors and assigns from and against
any and all costs, losses, Liabilities, damages, pending, threatened or
concluded lawsuits, deficiencies, claims and expenses (including reasonable fees
and disbursements of attorneys) (collectively, the "Damages") to the extent such
Damages are incurred in connection with or arise out of (i) any breach of any
covenant or agreement of Seller herein; (ii) the breach of any representation or
warranty made by Seller in this Agreement (without regard to materiality
qualifiers contained in such representations or warranties); and (iii) the
Retained Liabilities.
Buyer acknowledges and agrees that its sole and exclusive remedy
with respect to any and all claims relating to the subject matter of this
Agreement shall be pursuant to the indemnification provisions set forth in this
Article IX and pursuant to injunctive relief pertaining to this Agreement;
provided that nothing herein shall relieve any Party from liability based or
asserted on civil or criminal fraud, breach of covenant in contracts regarding
federal or state Medicaid obligations, or criminal violation.
24
(b) By Buyer. From and after the Closing, Buyer shall indemnify,
reimburse, and hold harmless Seller, its Affiliates and their respective
officers, directors, employees, agents, successors and assigns from and against
any and all Damages to the extent such Damages are incurred in connection with
or arise out of (i) any breach of any covenant or agreement of Buyer herein;
(ii) the breach of any representation or warranty made by Buyer in this
Agreement (without regard to materiality qualifiers contained in such
representations or warranties); and (iii) the Assumed Liabilities.
Seller acknowledges and agrees that its sole and exclusive remedy
with respect to any and all claims relating to the subject matter of this
Agreement shall be pursuant to the indemnification provisions set forth in this
Article IX, pursuant to injunctive relief pertaining to this Agreement and
pursuant to the Guaranty Agreement; provided that nothing herein shall relieve
any Party from liability based or asserted on civil or criminal fraud, breach of
covenant in contracts regarding federal or state Medicaid obligations, or
criminal violation.
(c) Procedures. In order for an indemnified Party under this Article
IX (an "Indemnified Party") to be entitled to any indemnification provided for
under this Agreement, such Indemnified Party shall give the indemnifying Party
(the "Indemnifying Party") written notice (an "Indemnification Claim Notice")
following the discovery of the matters giving rise to any Damages; provided,
however, that failure to give such notice shall not affect the indemnification
provided hereunder except to the extent the Indemnifying Party shall have been
actually prejudiced as a result of such failure (except that the Indemnifying
Party shall not be liable for any expenses incurred during the period in which
the Indemnified Party failed to give such notice). Each Indemnification Claim
Notice must contain a description of the claim and the nature and amount of such
Damages (to the extent that the nature and amount of such Damages are reasonably
known at such time). The Indemnified Party shall deliver to the Indemnifying
Party, with commercially reasonable promptness after the Indemnified Party's
receipt of such notice, all information and documentation reasonably requested
by the Indemnifying Party with respect to such Damages. All indemnification
claims in respect of a Party, its Affiliates or their respective directors,
officers, employees and agents (collectively, the "Indemnitees" and each an
"Indemnitee") shall be made solely by such Indemnified Party.
(d) Third Party Claims. The obligations of an Indemnifying Party
under this Section 9.02 with respect to Damages arising from claims of any third
party that are subject to indemnification as provided for in Section 9.02(a) or
Section 9.02(b) (a "Third Party Claim") shall be subject to the following
additional terms and conditions:
(i) At its option, the Indemnifying Party may assume the defense
of any Third Party Claim, by giving written notice to the
Indemnified Party at any time after the Indemnifying Party's
receipt of an Indemnification Claim Notice with respect to
such Third Party Claim. Upon assuming the defense of a Third
Party Claim, the Indemnifying Party may appoint as lead
counsel in the defense of the Third Party Claim legal counsel
selected by the Indemnifying
25
Party. In the event the Indemnifying Party assumes the defense
of a Third Party Claim, the Indemnified Party shall
immediately deliver to the Indemnifying Party all original
notices and documents (including court papers) received by any
Indemnitee in connection with the Third Party Claim. Should
the Indemnifying Party assume the defense of a Third Party
Claim, the Indemnifying Party shall not be liable to the
Indemnified Party or any other Indemnitee for any fees and
expenses of counsel subsequently incurred by such Indemnified
Party or other Indemnitee in connection with the defense or
prosecution of the Third Party Claim.
(ii) Without limiting Section 9.02(d)(i), in the event that the
Indemnifying Party shall have assumed the defense of a Third
Party Claim, any Indemnitee shall be entitled to participate
in, but not control, the defense of such Third Party Claim and
to employ counsel of its choice for such purpose; provided,
however, that such employment shall be at the Indemnitee's own
expense unless (A) the employment thereof has been
specifically authorized by the Indemnifying Party in writing
or (B) the Indemnifying Party shall have failed promptly to
assume the effective defense or prosecution of such Third
Party Claim.
(iii) With respect to any Damages relating solely to the payment of
money damages in connection with a Third Party Claim and that
will not result in the Indemnitee's becoming subject to
injunctive or other relief, the Indemnifying Party shall have
the sole right to consent to the entry of any judgment, enter
into any settlement or otherwise dispose of such Damages, on
such terms as the Indemnifying Party, in its sole discretion,
shall deem appropriate. With respect to all other Damages in
connection with Third Party Claims, where the Indemnifying
Party has assumed the defense of the Third Party Claim in
accordance with Section 9.02(d)(i), the Indemnifying Party
shall have authority to consent to the entry of any judgment,
enter into any settlement or otherwise voluntarily dispose of
such Damages; provided that it obtains the prior written
consent of the Indemnified Party (which consent shall not be
unreasonably withheld or delayed). The Indemnifying Party
shall not be liable for any settlement or other voluntary
disposition of Damages by an Indemnitee that is reached
without the written consent of the Indemnifying Party.
(iv) If the Indemnifying Party chooses to defend or prosecute any
Third Party Claim, the Indemnified Party shall, and shall
cause each other Indemnitee to, cooperate in the defense or
prosecution thereof and shall furnish such records,
information and testimony, provide such witnesses and attend
such conferences, discovery
26
proceedings, hearings, trials and appeals as may be reasonably
requested in connection therewith. Such cooperation shall
include access during normal business hours afforded to the
Indemnifying Party to, and reasonable retention by the
Indemnified Party of, records and information that are
reasonably relevant to such Third Party Claim, and making
Indemnitees and other employees and agents available on a
mutually convenient basis to provide additional information
and explanation of any material provided hereunder, and the
Indemnifying Party shall reimburse the Indemnified Party for
all its reasonable out-of-pocket expenses in connection
therewith. To the extent the records of the Indemnitee
referenced in this Section 9.02(d)(iv) are privileged by an
attorney-client relationship, the parties shall cooperate in a
manner as to preserve such privilege but to afford the
Indemnifying Party with all information relevant to such Third
Party Claim.
(e) Limitations on Indemnification. Notwithstanding the foregoing,
the indemnification in favor of any Indemnified Party included in the
Indemnitees hereunder shall not be effective until the aggregate dollar amount
of all Damages indemnified or indemnifiable against such Indemnified Party under
this Section 9.02(a)(i)&(ii) and Section 11.1 of the Interim Supply Agreement
(in the case of Seller) and 9.02(b)(i)&(ii) (in the case of Buyer), exceeds two
hundred fifty thousand dollars ($250,000) (the "Deductible Amount"), and then
only to the extent such aggregate amount exceeds the Deductible Amount; and (B)
shall terminate once the aggregate dollar amount of all Damages indemnified
against under Section 9.02(a)(i)&(ii) and Section 11.1 of the Interim Supply
Agreement (in the case of Seller) and 9.02(b)(i)&(ii) (in the case of Buyer)
aggregates to thirteen million dollars ($13,000,000) hereunder (the "Cap
Amount"), and the Indemnifying Party shall thereafter have no further
obligations or liabilities with respect to any such Damages thereafter.
(f) Damages Net of Insurance; Additional Limitations on
Indemnification. The amount of any Damages for which indemnification is provided
under this Article IX shall be net of any amounts recovered or recoverable by
the Indemnified Party under insurance policies with respect to such Damages. In
no event shall any Party be liable to any other Party for incidental, indirect,
special, punitive, exemplary or consequential damages, except to the extent that
the Indemnified Party is required to pay any such Damages to any third party.
ARTICLE X. MISCELLANEOUS
SECTION 10.01 CONFIDENTIALITY.
(a) After the Closing, Seller shall not, without the prior written
consent of Buyer, disclose to any Person, or use, confidential information
relating to or concerning the Purchased Assets, the Products, any Derivative
Brethine Products, or the Business (whether possessed by Seller or its
Affiliates prior to the Closing or provided to Seller by Buyer or its Affiliates
following the Closing), except (i) disclosures to Seller's
27
employees or representatives who need to know such information for purposes of
Taxes, accounting, pending litigation and other matters necessary in respect of
the Seller's ownership, prior to the Closing Date, of the Purchased Assets,
Products or the Business or (ii) with respect to Derivative Brethine Products
covered by Seller's timely option to obtain marketing rights outside the
Territory, disclosures to Government or Regulatory Authorities outside the
Territory, and use by Seller and its Affiliates, solely in support of Seller's
sale of such Derivative Brethine Products outside the Territory.
(b) After the Closing, neither Buyer nor its Affiliates shall,
without the prior written consent of Seller, disclose to any Person, or use,
confidential information relating to confidential or proprietary data,
information or records (whether written or oral) of the Seller (and any of its
Affiliates) including the Seller's business and technical information,
experience or data regarding any facility, programs, laboratories, processes,
products, costs, equipment operation or customers, which confidential
information is disclosed to Buyer or its Affiliates during or in connection with
the negotiation or implementation of this Agreement, except for disclosures
solely and exclusively relating to or concerning the Purchased Assets, the
Products, any Derivative Brethine Products, or the Business (whether possessed
by Buyer or its Affiliates prior to the Closing or provided to Buyer or their
Affiliates by Seller following the Closing).
(c) Notwithstanding the foregoing, however, a Party subject to the
confidentiality and non-use obligations of this Section 10.01 may make such
disclosures of such information to the extent, and only to the extent, that it
has been advised by counsel that disclosure is required to be made to the
intended recipients (and no others) under applicable Law or the requirements of
a national securities exchange or another similar regulatory body. In the event
that such obligated Party is requested or required by documents subpoena, civil
investigative demand, interrogatories, requests for information, or other
similar process to disclose any information governed by such obligations, such
obligated Party shall provide the Party whose information is being protected
hereunder with prompt notice of such request or demands or other similar process
so that the protected Party may seek an appropriate protective order or, if such
request, demand or other similar process is mandatory, waive the obligated
Party's compliance with the provisions of this Section 10.01 as appropriate.
(d) The term confidential information as used in this Section 10.01
does not include information which (i) becomes generally available to the public
other than as a result of disclosure by the receiving Party or its Affiliates,
(ii) was available on a non-confidential basis prior to its disclosure by the
disclosing Party, or (iii) becomes available to the receiving Party on a
non-confidential basis from a source other than the disclosing Party, provided
that such source is not bound by a confidentiality agreement with the disclosing
Party.
(e) The confidentiality and non-use obligations contained in this
Section 10.01 shall survive for a period of ten (10) years following the
termination or expiration of the Interim Supply Agreement.
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(f) After the Closing, that certain Confidentiality Agreement, dated
as of June 19, 2001, by and between Buyer and Seller (the "Confidentiality
Agreement"), shall continue in full force and effect, except that Buyer is
released from its obligations thereunder with respect to Confidential
Information received from Seller thereunder that pertains to the Products,
Business or Purchased Assets.
SECTION 10.02 NOTICES.
All notices, requests and other communications hereunder must be in
writing and will be deemed to have been duly given only if delivered personally
against written receipt or by facsimile transmission with answer back
confirmation or mailed (postage prepaid by certified or registered mail, return
receipt requested) or by nationally recognized overnight courier that maintains
records of delivery to the Parties at the following addresses or facsimile
numbers:
If to Buyer to:
NeoSan Pharmaceuticals Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
aaiPharma Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: General Counsel
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to Seller to:
Novartis Pharmaceuticals Corporation
▇▇ ▇▇▇▇▇ ▇▇
▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇,
Head, U.S. Mature Products,
and
▇▇▇▇ ▇▇▇▇▇▇
Associate General Counsel
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
29
Novartis Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Vice President and
Associate General Counsel
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ LLP
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
All such notices, requests and other communications will (a) if delivered
personally to the address as provided in this Section, be deemed given upon
receipt, (b) if delivered by facsimile to the facsimile number as provided in
this Section, be deemed given upon receipt by the sender of the answer back
confirmation and (c) if delivered by mail in the manner described above or by
overnight courier to the address as provided in this Section, be deemed given
upon receipt (in each case regardless of whether such notice, request or other
communication is received by any other Person to whom a copy of such notice,
request or other communication is to be delivered pursuant to this Section). Any
Party from time to time may change its address, facsimile number or other
information for the purpose of notices to that Party by giving notice specifying
such change to the other Parties hereto in accordance with the terms of this
Section.
SECTION 10.03 ENTIRE AGREEMENT.
This Agreement (and all Exhibits and Schedules attached hereto and
all other documents delivered in connection herewith) and the Confidentiality
Agreement supersedes all prior discussions and agreements, both written and
oral, among the Parties with respect to the subject matter hereof and contains
the sole and entire agreement among the Parties with respect to the subject
matter hereof.
SECTION 10.04 WAIVER.
Any term or condition of this Agreement may be waived at any time by
the Party that is entitled to the benefit thereof, but no such waiver shall be
effective unless set forth in a written instrument duly executed by or on behalf
of the Party waiving such term or condition. No waiver by any Party of any term
or condition of this Agreement, in any one or more instances, shall be deemed to
be or construed as a waiver of the same or any other term or condition of this
Agreement on any future occasion. All remedies, either under this Agreement or
by Law or otherwise afforded, will be cumulative and not alternative.
30
SECTION 10.05 AMENDMENT.
This Agreement may be amended, supplemented or modified only by a
written instrument duly executed by each Party.
SECTION 10.06 THIRD PARTY BENEFICIARIES.
The terms and provisions of this Agreement (and all Exhibits and
Schedules attached hereto and all other documents delivered in connection
herewith) are intended solely for the benefit of each Party and their respective
successors or permitted assigns and it is not the intention of the Parties to
confer third-party beneficiary rights or remedies hereunder or thereunder upon
any other Person.
SECTION 10.07 ASSIGNMENT; BINDING EFFECT.
Neither this Agreement nor any right, interest or obligation
hereunder may be assigned by any Party without the prior written consent of the
other Party; provided, however, that either Party may assign its rights and
obligations under this Agreement, without the prior written consent of the other
Party, to an Affiliate or to a successor of the relevant portion of the
assigning Party's business by reason of merger, sale of all or substantially all
of its assets or any similar transaction, provided that such successor agrees in
writing to be bound by this Agreement. Such consent shall not be unreasonably
withheld or delayed. Any permitted assignee shall assume all obligations of its
assignor under this Agreement. No assignment shall relieve either Party of its
responsibility for the performance of any obligation.
SECTION 10.08 HEADINGS.
The table of contents and headings used in this Agreement have been
inserted for convenience of reference only and do not define or limit the
provisions hereof.
SECTION 10.09 SEVERABILITY.
If any provision of this Agreement is held to be illegal, invalid or
unenforceable under any present or future law or public policy, and if the
economic or legal substance of the transactions contemplated hereby is not
affected in any manner materially adverse to any Party, (a) such provision will
be fully severable, (b) this Agreement will be construed and enforced as if such
illegal, invalid or unenforceable provision had never comprised a part hereof,
(c) the remaining provisions of this Agreement will remain in full force and
effect and will not be affected by the illegal, invalid or unenforceable
provision or by its severance herefrom, and (d) in lieu of such illegal, invalid
or unenforceable provision, there will be added automatically as a part of this
Agreement a legal, valid and enforceable provision as similar to terms to such
illegal, invalid or unenforceable provision as may be possible and reasonably
acceptable to the Parties herein.
31
SECTION 10.10 GOVERNING LAW.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED AND PERFORMED
IN SUCH STATE, WITHOUT GIVING EFFECT TO CONFLICTS OF LAWS PRINCIPLES.
SECTION 10.11 CONSENT TO JURISDICTION AND FORUM SELECTION.
THE PARTIES HERETO AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING IN
CONNECTION WITH THIS AGREEMENT SHALL BE INITIATED AND TRIED EXCLUSIVELY IN THE
LOCAL AND FEDERAL COURTS LOCATED IN THE STATE OF NEW YORK, IN THE FEDERAL
COURTS' SOUTHERN DISTRICT OF NEW YORK. THE AFOREMENTIONED CHOICE OF VENUE IS
INTENDED BY THE PARTIES TO BE MANDATORY AND NOT PERMISSIVE IN NATURE, THEREBY
PRECLUDING THE POSSIBILITY OF LITIGATION BETWEEN THE PARTIES WITH RESPECT TO OR
ARISING OUT OF THIS AGREEMENT IN ANY JURISDICTION OTHER THAN THAT SPECIFIED IN
THIS SECTION. EACH PARTY HEREBY WAIVES ANY RIGHT IT MAY HAVE TO ASSERT THE
DOCTRINE OF FORUM NON CONVENIENS OR SIMILAR DOCTRINE OR TO OBJECT TO VENUE WITH
RESPECT TO ANY PROCEEDING BROUGHT IN ACCORDANCE WITH THIS SECTION, AND
STIPULATES THAT THE LOCAL AND FEDERAL COURTS LOCATED IN THE STATE OF NEW YORK,
IN THE FEDERAL COURTS' SOUTHERN DISTRICT OF NEW YORK, SHALL HAVE PERSONAL
JURISDICTION AND VENUE OVER EACH OF THEM FOR PURPOSES OF LITIGATING ANY DISPUTE,
CONTROVERSY OR PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT. EACH
PARTY HEREBY AUTHORIZES AND AGREES TO ACCEPT SERVICE OF PROCESS SUFFICIENT FOR
PERSONAL JURISDICTION IN ANY ACTION AGAINST IT AS CONTEMPLATED BY THIS SECTION
BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, POSTAGE PREPAID TO
ITS ADDRESS FOR THE GIVING OF NOTICES AS SET FORTH IN THIS AGREEMENT, OR IN THE
MANNER SET FORTH IN SECTION 10.02 OF THIS AGREEMENT FOR THE GIVING OF NOTICE.
ANY FINAL JUDGMENT RECEIVED AGAINST A PARTY IN ANY ACTION OR PROCEEDING SHALL BE
CONCLUSIVE AS TO THE SUBJECT OF SUCH FINAL JUDGMENT AND MAY BE ENFORCED IN OTHER
JURISDICTIONS IN ANY MANNER PROVIDED BY LAW.
SECTION 10.12 WAIVER OF JURY TRIAL.
EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY WAIVES
TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT, THE
AGREEMENTS, INSTRUMENTS AND DOCUMENTS CONTEMPLATED HEREBY OR THE
32
TRANSACTIONS CONTEMPLATED HEREBY AND FOR ANY COUNTERCLAIM THEREIN.
SECTION 10.13 SPECIFIC PERFORMANCE.
The Parties agree that irreparable damage could occur in the event
any provision of this Agreement were not performed in accordance with the terms
hereof and that the Parties shall be entitled to specific performance of the
terms hereof, in addition to any other remedy at law or equity, without the
necessity of demonstrating the inadequacy of monetary damages and without the
posting of a bond.
SECTION 10.14 EXPENSES.
Except as otherwise provided in this Agreement, each Party shall pay
its own expenses and costs incidental to the preparation of this Agreement and
to the consummation of the transactions contemplated hereby.
SECTION 10.15 COUNTERPARTS.
This Agreement may be executed in any number of counterparts and by
facsimile, each of which will be deemed an original, but all of which together
will constitute one and the same instrument.
SECTION 10.16 SCHEDULES, EXHIBITS AND OTHER AGREEMENTS.
The Exhibits, Schedules, other agreements, certificates and notices
specifically referred to herein, and delivered pursuant hereto, are an integral
part of this Agreement. Any disclosure that is made in any of the Schedules or
certificates delivered pursuant to this Agreement shall be deemed responsive to
any other applicable disclosure obligation hereunder.
SECTION 10.17 PUBLICITY.
Except as may be required by applicable securities laws and
regulations upon the advice of counsel, neither Seller, on the one hand, nor
Buyer, on the other hand, shall issue or cause the publication of any press
release or other public announcement with respect to the terms of the
transactions (i.e., purchase price, inventory price, supply price, supply term,
royalty rates, etc.) contemplated by this Agreement, the Interim Supply
Agreement and the License Agreement without the consent of the other Party,
which consent shall not be unreasonably withheld, provided that the press
release in the form attached hereto as Exhibit F may be released and provided
further other than as set forth in this Section 10.17, that nothing herein shall
restrict Buyer's rights to disclose or not disclose any information pertaining
to the Purchased Assets or Business following the completion of the Closing and
the transfer of the Purchased Assets to Buyer hereunder.
[Remainder of Page Intentionally Left Blank]
33
IN WITNESS WHEREOF, this Agreement has been executed by the Parties
hereto all as of the date first above written.
NOVARTIS PHARMACEUTICALS
CORPORATION
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Senior Vice President and General
Manager of Commercial Operations
NOVARTIS CORPORATION
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
--------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Vice President
NEOSAN PHARMACEUTICALS INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: President