Exhibit 99.1
* Portions of this exhibit have been omitted pursuant to a request for
confidential treatment filed with the Commission. The omitted portions,
marked by "*", have been separately filed with the Commission.
+ Exhibit I to this Agreement has been omitted because such Exhibit does not
contain information material to an investment decision. IGEN agrees to
furnish supplementally a copy of such Exhibit to the Commission upon
request.
AMENDMENT NO. 1
TO
JOINT VENTURE AGREEMENT
THIS AMENDMENT NO. 1 TO JOINT VENTURE AGREEMENT (this "Amendment
---------
No. 1") is entered into as of August 15, 2001, by and among Meso Scale
-----
Diagnostics, LLC., a Delaware limited liability company ("MSD"), Meso Scale
---
Technologies, LLC., a Delaware limited liability company ("MST"), and IGEN
---
International, Inc., a Delaware corporation (formerly IGEN, Inc., a California
corporation) ("IGEN");
----
WHEREAS, MSD, MST and IGEN entered into a Joint Venture
Agreement, dated as of November 30, 1995, as amended (the "Joint Venture
-------------
Agreement"), for the purpose of setting forth their respective rights and
---------
obligations with respect to certain research and development activities and, if
successful, the development, manufacturing, marketing and sale of the products,
processes and services based thereon;
WHEREAS, MSD, MST and IGEN desire to further amend the Joint
Venture Agreement to, among other things, extend the term of the Joint Venture
Agreement and to make certain other changes, all as herein set forth;
WHEREAS, for purposes of this Amendment No. 1, capitalized terms
not otherwise defined herein shall have the respective meanings set forth in the
Joint Venture Agreement (as amended by this Amendment No. 1); and
WHEREAS, MST and IGEN are amending the LLC Agreement concurrently
with the execution and delivery of this Amendment No. 1, and MSD, MST and IGEN
are executing and delivering various other agreements in connection with the
execution and delivery of this Amendment No. 1 and the amendment to the LLC
Agreement;
NOW, THEREFORE, in consideration of the foregoing and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, MSD, MST and IGEN each hereby agrees as follows:
1. Definitions.
------------
(A) The first sentence of Section 1.11. is hereby deleted in its entirety
and replaced with the following:
"Research Technologies" shall mean (i) * methods, including, without
----------------------
limitation, the * described in the United States Patent application
entitled * serial no. * (including all divisions, continuations and
continuations-in-part thereto), and * all relating to only the * of
the * and * (ii) * including, without limitation, * and * the *
and/or * (e.g., through *), and * and * (e.g., through * and *),
including without limitation, for use in * methods (including,
without limitation, the * described in the United States Patent
application entitled * serial no. * (including all divisions,
continuations and continuations-in-part thereto), and *), and/or
(iii) * (e.g., *), including, without limitation, for use in *
methods (including, without limitation, the * described in the
United States Patent application entitled * serial no. * (including
all divisions, continuations and continuations-in-part thereto),
and *)."
(B) Section 1.12. is hereby amended and restated in its entirety as
follows:
"1.12. "ECL Improvements" shall mean any inventions or know-how
----------------
developed by MSD in the field of (a) electrochemiluminescent labels,
and (b) general electrochemical techniques and processes for
modulating electric potential to alter chemical species for use in
single electrode systems (i.e., for serial detection using flow cells)
in order to generate electrochemiluminescence."
(C) Section 1. is hereby amended by adding a new Section 1.15. thereto as
follows:
"1.15. "Change in Control" shall mean any one or more of the following
-----------------
events:
(a) 15% or more of the ownership, control, power to vote or
beneficial ownership of any class of voting securities of IGEN is
acquired by any person, either directly or indirectly or acting
through one or more other persons, other than by any employee benefit
plan of IGEN or any entity holding voting securities of IGEN for or
pursuant to the terms of any such plan, or by Xxxxxx X. Xxxxxxxxxxx,
his affiliates, his heirs and any trust or foundation to which he has
transferred or may transfer voting securities of IGEN, and the owner
of such interest shall have the right, pursuant to any agreement,
arrangement or understanding with IGEN, to nominate one or more
persons for election as directors of IGEN;
(b) any person (other than any person named as a proxy in connection
with any solicitation on behalf of the Board of Directors of IGEN)
holds irrevocable proxies which when added to the voting securities
beneficially owned by such person, aggregates to be, as to the
election or removal of two or more directors of IGEN, 30% or more of
the total number of voting shares of IGEN, other than any employee
benefit plan of IGEN or any entity holding voting securities of IGEN
for or pursuant to the terms of any such plan, or Xxxxxx X.
Xxxxxxxxxxx, his
-2-
affiliates, his heirs and any trust or foundation to which he has
transferred or may transfer voting securities of IGEN;
(c) 30% or more of the ownership, control, power to vote or beneficial
ownership of any class of voting securities of IGEN is acquired by any
person, either directly or indirectly or acting through one or more
persons, other than by any employee benefit plan of IGEN or any entity
holding voting securities of IGEN for or pursuant to the terms of any
such plan, or by Xxxxxx X. Xxxxxxxxxxx, his affiliates, his heirs and
any trust or foundation to which he has transferred or may transfer
voting securities of IGEN;
(d) as the result of, or in connection with, any cash tender or
exchange offer, merger, or other business combination, sale of assets
or contested election, or any combination of the foregoing
transactions, (i) the persons who were directors of IGEN before such
transaction shall cease to constitute at least a majority of the Board
of Directors of IGEN or its successor or (ii) the persons who were
stockholders of IGEN immediately before such transaction do not own
more than 50% of the outstanding voting securities of IGEN or its
successor immediately after such transaction;
(e) IGEN shall sell, lease, exchange, assign, dispose of or transfer
all or substantially all of its property and assets; or
(f) one or more directors not nominated by the Board of Directors of
IGEN (for this purpose, for example, any persons nominated for
election or actually elected to fill a vacancy or newly created
directorship pursuant to any agreement, arrangement or understanding
between IGEN and any person or group that commenced or threatened to
commence a proxy contest (including election contests and nonelection
contests) with respect to IGEN shall not be considered to be nominated
by IGEN) is elected as a director of IGEN at any regular or special
meeting of the stockholders of IGEN or any regular or special meeting
of the Board of Directors of IGEN.
For purposes of this definition, a "person" includes an individual, corporation,
partnership, trust, association, joint venture, pool, syndicate, unincorporated
organization, joint-stock company or similar organization or entity or group
acting in concert. A person for these purposes shall be deemed to be a
"beneficial owner" as that term is used in Rule 13d-3 under the Securities
Exchange Act of 1934."
-3-
2. Board of Managers.
------------------
(A) Section 2.2. is hereby amended by deleting the word "For" from the
first sentence thereof and replacing it with the following phrase:
"Except as otherwise required or permitted by this Agreement or the
LLC Agreement,".
(B) Section 2.2. is hereby further amended by adding the following
sentence immediately after the first sentence thereof:
"IGEN shall be entitled to rely on the authority of the MST Manager
(as defined below) with respect to all decisions made and actions
taken by the MST Manager on behalf of MST pursuant to this Agreement
without any obligation to perform any further inquiry thereof, and MST
shall be entitled to rely on the authority of the IGEN Manager (as
defined below) with respect to all decisions made and actions taken on
behalf of IGEN pursuant to this Agreement without any obligation to
perform any further inquiry thereof; provided, however, that nothing
in this Section 2.2. shall be deemed to affect the requirements for
approval of the budget (as set forth in Section 2.8.) by the committee
of the Board of Directors of IGEN designated by such Board to consider
such matters on behalf of IGEN (the "Budget Committee") as set forth
----------------
in Section 2.8."
(C) Section 2.2. is hereby further amended by inserting the following at
the beginning of the original second sentence thereof:
"Except as otherwise required or permitted by this Agreement or the
LLC Agreement,".
3. IGEN Financing.
--------------
(A) Section 2.4.1. is hereby amended by deleting the number "$5,000,000"
and replacing it with the number "$3,100,000".
(B) Section 2.4.1.(a) is hereby amended and restated in its entirety as
follows:
"(a) The parties agree that the funding of the Initial IGEN Capital
Contribution was completed as of December 31, 2000. Additional Funding
(as defined in Section 2.4.3.) shall be made by IGEN in accordance
with the terms of this Agreement."
-4-
(C) Section 2.4.1.(b) is hereby amended and restated in its
entirety as follows:
"(b) For each $500 of the Initial IGEN Capital Contribution
contributed, $1.00 has been credited to IGEN's Class A
Capital Account (the "Initial IGEN Class A Capital
----------------------------
Contribution") and $499.00 has been credited to IGEN's Class
------------
B Capital Account (the "Initial IGEN Class B Capital
----------------------------
Contribution"). As of any date, but subject to adjustment in
------------
accordance with Section 10.14. of this Agreement, IGEN's
Class A membership interest shall be the quotient, expressed
as a percentage, obtained by dividing the amount of the
Initial IGEN Class A Capital Contribution credited to IGEN's
Class A Capital Account as of such date by 20,000, and MST's
Class A membership interest as of any date shall be the
difference between such quotient, expressed as a percentage,
and 100 percent (each, a "Percentage Interest"). As a result
-------------------
of the contribution to MSD of all of the Initial IGEN Capital
Contribution through December 31, 2000, as of such date and
as of the date of execution and delivery of the Amendment No.
1 to Joint Venture Agreement by and among MSD, MST and IGEN,
the Percentage Interest of IGEN was Thirty-One Percent (31%)
and the Percentage Interest of MST was Sixty-Nine Percent
(69%)."
(D) Section 2.4.1.(c) is hereby deleted in its entirety.
(E) Section 2.4.2 is hereby amended by deleting the phrase ", all
such expenses and expenditures to be subject to approval by the Board of
Managers" from the first sentence thereof and by replacing the last two
sentences thereof with the following:
"From and after January 1, 2001, IGEN's funding of expenses
pursuant to this Section 2.4.2. shall be treated as Class C
capital contributions to MSD to the extent provided in
Exhibit I hereto."
(F) Section 2.4. is hereby amended by adding a new Section 2.4.3.
thereto as follows:
"2.4.3. Additional Funding.
------------------
(a) Until such time as MSD consummates one or more third
party financing transactions involving the sale of debt or
equity securities of MSD (including debt financings through
term loans or sale leaseback transactions in either case
having a term of
-5-
greater than one year, but excluding debt financings
through revolving credit facilities, lines of credit
and lease financing transactions) ("Third Party
-----------
Financing") with aggregate gross proceeds to MSD in
---------
excess of $50,000,000 (the "Financing Threshold"),
-------------------
subject to the requirements set forth in Section
2.8., IGEN shall fund the reasonably necessary
ongoing operating, capital expenditure and investment
requirements of MSD (the "Additional Funding"). IGEN
------------------
shall provide Additional Funding, which shall consist
of both cash and in-kind contributions, as follows:
(y) for each budgetary period, IGEN shall provide MSD
with cash and in-kind contributions set forth in the
budget approved for such period pursuant to Section
2.8.1., Section 2.8.2. or Section 2.8.3., as
applicable, and (z) as to each budgetary period,
amounts agreed to be contributed during the budgetary
period in excess of amounts otherwise required to be
contributed during the budgetary period pursuant to
this Agreement, which includes amounts payable by
IGEN pursuant to Section 2.8.5. for the budgetary
period. In addition to the funding amounts set forth
in the preceding sentence, IGEN will consider (in
light of IGEN's financial capacity at the time)
providing additional funding (cash and/or in-kind) to
MSD in excess of the funding amounts set forth in the
preceding sentence, including the contributions for
the last six months of the 2001 Fiscal Period (as
defined in Section 2.8.1 hereof) identified as
"Discretionary Funding" in the 2001 Budget (as
---------------------
defined in Section 2.8.1 hereof) if IGEN determines
in its sole discretion that such contributions are in
the best interests of IGEN; provided that, IGEN
hereby agrees that, in connection with its
consideration of such action, IGEN shall take into
consideration the interests of MSD. Additional
Funding funded by IGEN, plus any funding provided
during the period January 1, 2001 through the date of
execution and delivery of the Amendment No. 1 to
Joint Venture Agreement by and among MSD, MST and
IGEN, shall be treated as Class C capital
contributions to MSD to the extent provided in
Exhibit I hereto. To the extent that MSD consummates
one or more Third Party Financings with aggregate
gross proceeds to MSD in excess of the Financing
Threshold, IGEN shall have no obligation to provide
any Additional Funding to MSD.
(b) In the event of a Change in Control, MST may
accelerate IGEN's additional funding obligation set
forth in Section 2.4.3.(a), and IGEN shall promptly
pay to MSD, in cash, a lump sum amount equal to (i)
if the Change in Control occurs at any time during
calendar year 2001, the sum of the aggregate
-6-
committed funding of IGEN set forth in the 2001
Budget plus any additional amounts funded by IGEN in
its sole discretion during the 2001 Fiscal Period or,
if greater, any actual budget for calendar year 2002
approved in accordance with Section 2.8.2., or (ii)
if the Change in Control occurs at any time after
calendar year 2001, the sum of the aggregate
committed funding of IGEN set forth in the
then-current budget (previously approved in
accordance with Section 2.8.) plus any additional
amounts funded by IGEN in its sole discretion during
the period covered by such budget or, if greater, any
actual budget for calendar year 2003 approved in
accordance with Section 2.8. In addition, with
respect to projects jointly funded or involving
shared resources, (a) IGEN shall continue to fund
such projects and resources for a period of not less
than 12 months beginning on the date of such Change
in Control consistent with Exhibit I hereto and
then-existing practice, or (b) pay to MSD an
aggregate amount equal to the cost of the IGEN
portion of such projects and resources over such
12-month period. Following a Change in Control and
payment to MSD of the lump sum cash amount pursuant
to this Section 2.4.3(b), MSD shall repay IGEN,
consistent with Exhibit I hereto and then-existing
practice, for MSD expenses or liabilities paid or
assumed by IGEN on behalf of MSD following such
Change in Control, until such time as all such MSD
expenses or liabilities are transferred to or have
been assumed by MSD pursuant to a mutually acceptable
written agreement between the parties.
(c) (i) If MSD consummates any Third Party
Financing, whether or not in excess of the Financing
Threshold, IGEN shall be entitled to receive a
payment in respect of its then outstanding Class C
membership interest equal to 10% of the aggregate net
proceeds of such Third Party Financing (the
"Financing Payment"). The Financing Payment shall be
-----------------
allocated first to reduce the accrued and unpaid
Preferred Return Amount (as defined in the LLC
Agreement) of IGEN's Class C membership interest,
with the remainder applied to reduce the Adjusted
Cumulative Class C Capital Contribution (as defined
in the LLC Agreement) of IGEN to the extent thereof.
(ii) If IGEN is entitled to a Financing Payment in
connection with any Third Party Financing of MSD that
is structured, in whole or in part, as debt
securities, the portion of such Financing Payment
attributable to debt securities shall be paid in
cash. If IGEN is entitled to a Financing Payment in
-7-
connection with any Third Party Financing of MSD that is
structured, in whole or in part, as equity securities, the
portion of such Financing Payment attributable to equity
securities shall, at MST's option, be paid in cash, shares of
the same class of equity securities issued in connection with
such Third Party Financing or a combination thereof, with the
value of any shares of equity so issued determined based on
the price per share of equity issued in connection with such
Third Party Financing."
4. Additional Funding if Product Developed. Section 2.5. (and
---------------------------------------
subsections) is hereby amended by deleting the heading and text of such section
in their entirety, and the following is substituted therefor: "[Provision
Intentionally Omitted]".
5. Restrictions on MSD. Section 2.7.1. is hereby amended by
-------------------
deleting the phrase "During the term of this Agreement," and replacing it with
the phrase "Except as otherwise required or permitted by this Agreement, the LLC
Agreement, or other written agreements executed and delivered with respect
hereto or thereto,".
6. Budget. Section 2.8. is hereby amended and restated in its
------
entirety as follows:
"2.8.1. General. For the period August 15, 2001 (the
-------
"Commencement Date") until the first anniversary of the
-----------------
Commencement Date (the "2001 Fiscal Period"), the management
------------------
of MSD, in consultation with the Board of Managers and
representatives of IGEN, has prepared and submitted and the
committee of the Board of Directors of IGEN established by
the Board of Directors of IGEN at its meeting on August 31,
2000 (the "IGEN Committee") has unanimously approved, an
--------------
operating, capital expenditure and investment budget for MSD
which specifies the aggregate funding (which shall consist of
both cash and in-kind contributions) to be provided by IGEN
to MSD during the 2001 Fiscal Period (the "2001 Budget").
-----------
2.8.2. 2002 Budget.
-----------
(a) At least forty-five (45) days prior to the beginning of
the 2002 fiscal year (which is the period from January 1,
2002 through December 31, 2002), the management of MSD, in
consultation with the Board of Managers, shall prepare and
submit to the Budget Committee an operating, capital
expenditure and investment budget for such fiscal year (the
"Submitted 2002 Budget"), which budget shall specify the
---------------------
-8-
aggregate funding (which shall consist of both cash
and in-kind contributions) to be provided by IGEN to
MSD during the 2002 fiscal year and which budget
shall be subject to the approval of a majority of the
members of the Budget Committee. In approving a
budget for the 2002 fiscal year, the Budget Committee
shall consider as a factor whether MSD has announced
an operational product at the SBS 2001 meeting (the
"SBS Show") to be held in Baltimore, Maryland (such
--------
announcement to include a press release, pre-show
direct mail materials, technology brochures,
application notes, a list of leads and a booth at the
SBS Show with an operational product). Unless a
budget for the 2002 fiscal year is approved or deemed
approved in accordance with Section 2.8.2(e), IGEN
shall have no obligation to provide funding or other
resources to MSD pursuant to this Agreement beyond
the 2001 Fiscal Period except for the funding for the
2002 Extension Period provided in Section 2.8.2(b).
(b) (i) If the aggregate committed funding of IGEN
set forth in the Submitted 2002 Budget does not
exceed an amount equal to 1.1 multiplied by the
aggregate committed funding of IGEN set forth in the
2001 Budget and (ii) if the Budget Committee delivers
written notice to MSD of its decision not to approve
the Submitted 2002 Budget within forty-five (45) days
after receipt of the 2002 Submitted Budget (the "2002
----
Approval Period"), in addition to any rights MST and
---------------
MSD may have under Section 8.5.3. or otherwise, and
in addition to its existing funding obligation for
the period January 1, 2002 through the end of the
2001 Fiscal Period, as set forth in Section 2.4.3.,
IGEN shall continue to fund, through cash and in-kind
contributions, the reasonably necessary ongoing
operating, capital expenditure and investment
requirements of MSD consistent with then-existing
practice and consistent with the terms of this
Agreement for the six month period beginning
immediately following the end of the 2001 Fiscal
Period (the "2002 Extension Period") in an aggregate
---------------------
amount equal to the product of (i) six (6) and (ii)
one-twelfth (1/12th) of the sum of (I) the aggregate
amount of the aggregate committed funding of IGEN set
forth in the 2001 Budget plus (II) amounts
contributed during the 2001 Fiscal Period in excess
of amounts otherwise required to be contributed
during the 2001 Fiscal Period pursuant to this
Agreement. Without limiting the generality of the
foregoing, with respect to projects jointly funded or
involving shared resources, during the 2002 Extension
Period IGEN shall (x) continue to fund such projects
and resources consistent with
-9-
Exhibit I and then-existing practice, or (y) pay to
MSD an aggregate amount equal to the cost of the IGEN
portion of such projects and resources.
(c) (i) If the aggregate committed funding of IGEN
set forth in the Submitted 2002 Budget exceeds an
amount equal to 1.1 multiplied by the aggregate
committed funding of IGEN set forth in the 2001
Budget, (ii) if the Budget Committee, after making a
reasonable good faith determination, determines not
to approve such Submitted 2002 Budget, and (iii) if
the Budget Committee delivers written notice to MSD
of its decision not to approve such Submitted 2002
Budget (which notice shall explain, in reasonable
detail, the reasons for the Budget Committee's
decision) (a "Budget Rejection Notice") within the
-----------------------
2002 Approval Period, then the management of MSD, in
consultation with the Board of Managers, shall have
the one-time right to submit a modified operating,
capital expenditure and investment budget (the
"Alternate 2002 Budget") to the Budget Committee,
---------------------
within forty-five (45) days of receipt by MSD of such
Budget Rejection Notice for approval by the Budget
Committee. Such Alternate 2002 Budget will be subject
to the same approval process applied to the Submitted
2002 Budget in Sections 2.8.2.(b), (d) and (e).
(d) (i) If the aggregate committed funding of IGEN
set forth in the Submitted 2002 Budget exceeds an
amount equal to 1.1 multiplied by the aggregate
committed funding of IGEN set forth in the 2001
Budget, (ii) if the Budget Committee, without making
a reasonable good faith determination, determines not
to approve such Submitted 2002 Budget, and (iii) if
the Budget Committee delivers a Budget Rejection
Notice regarding the Submitted 2002 Budget to MSD
within the 2002 Approval Period, then, in addition to
any rights MST and MSD may have under Section 8.5.3.
or otherwise, IGEN shall be obligated to provide the
funding contemplated in Section 2.8.2.(b) above in
accordance therewith.
(e) If (i) the Budget Committee delivers written
notice to MSD of its approval of the Submitted 2002
Budget or the Alternate 2002 Budget, as the case may
be, within the 2002 Approval Period or (ii) the
Budget Committee fails to deliver either written
notice to MSD of its approval of the Submitted 2002
Budget or the Alternate 2002 Budget, as the case may
be, or a Budget Rejection Notice regarding the
Submitted 2002 Budget or the Alternate 2002 Budget,
as the case may be, within
-10-
the 2002 Approval Period, then the 2002 Submitted
Budget or 2002 Alternate Budget, as the case may be,
shall be approved as of the date of such written
notice (or, in the event no notice is received within
the 2002 Approval Period, shall be deemed approved as
of the last day of the 2002 Approval Period), and
IGEN shall provide Additional Funding for the 2002
fiscal year consistent with Section 2.4.3. Once
approved or deemed approved, as the case may be, the
Submitted 2002 Budget or the Alternate 2002 Budget,
as applicable, shall replace the 2001 Budget for the
period beginning January 1, 2002.
2.8.3. 2003 Budget.
-----------
(a) If the Budget Committee has approved (or is
deemed to have approved) the Submitted 2002 Budget or
the Alternate 2002 Budget, then at least forty-five
(45) days prior to the beginning of the 2003 fiscal
year (which is the period from January 1, 2003
through November 30, 2003), the management of MSD, in
consultation with the Board of Managers, shall
prepare and submit to the Budget Committee an
operating, capital expenditure and investment budget
for such fiscal year (the "Submitted 2003 Budget"),
---------------------
which budget shall specify the aggregate funding
(which shall consist of both cash and in-kind
contributions) to be provided by IGEN to MSD during
the 2003 fiscal year and which budget shall be
subject to the approval of a majority of the members
of the Budget Committee.
(b) If (i) the aggregate committed funding of IGEN
set forth in the Submitted 2003 Budget does not
exceed an amount equal to 1.1 multiplied by the
aggregate committed funding of IGEN set forth in the
budget for fiscal year 2002 approved or deemed
approved pursuant to Section 2.8.2 and (ii) the
Budget Committee delivers written notice to MSD of
its decision not to approve the Submitted 2003 Budget
within forty-five (45) days after receipt of the 2003
Submitted Budget (the "2003 Approval Period"), in
--------------------
addition to any rights MST and MSD may have under
Section 8.5.3. or otherwise, IGEN shall continue to
fund, through cash and in-kind contributions, the
reasonably necessary ongoing operating, capital
expenditure and investment requirements of MSD
consistent with then-existing practice and consistent
with the terms of this Agreement for the period
January 1, 2003 through June 30, 2003 (the "2003
----
Extension Period") in an aggregate amount equal to
----------------
the product of (i) six (6) and (ii) one-twelfth
(1/12/th/) of the sum of (I) the aggregate amount of
the aggregate committed funding of IGEN
-11-
set forth in the budget for fiscal year 2002 approved
or deemed approved pursuant to Section 2.8.2. plus
(II) amounts contributed during the 2002 fiscal year
in excess of amounts otherwise required to be
contributed during the 2002 fiscal year pursuant to
this Agreement (excluding, for purposes of this
calculation, amounts required to be contributed
pursuant to Section 2.8.5). Without limiting the
generality of the foregoing, with respect to projects
jointly funded or involving shared resources, during
the 2003 Extension Period IGEN shall (x) continue to
fund such projects and resources consistent with
Exhibit I and then-existing practice, or (y) pay to
MSD an aggregate amount equal to the cost of the IGEN
portion of such projects and resources.
(c) (i) If the aggregate committed funding of IGEN
set forth in the Submitted 2003 Budget exceeds an
amount equal to 1.1 multiplied by the aggregate
committed funding of IGEN set forth in the budget for
fiscal year 2002 approved or deemed approved pursuant
to Section 2.8.2, (ii) if the Budget Committee, after
making a reasonable good faith determination,
determines not to approve such Submitted 2003 Budget,
and (iii) if the Budget Committee delivers a Budget
Rejection Notice regarding the Submitted 2003 Budget
within the 2003 Approval Period, then the management
of MSD, in consultation with the Board of Managers,
shall have the one-time right to submit a modified
operating, capital expenditure and investment budget
(the "Alternate 2003 Budget") to the Budget
---------------------
Committee, within forty-five (45) days of receipt by
MSD of such Budget Rejection Notice for approval by
the Budget Committee. Such Alternate 2003 Budget will
be subject to the same approval process applied to
the Submitted 2003 Budget in Sections 2.8.3.(b), (d)
and (e).
(d) (i) If the aggregate committed funding of IGEN
set forth in the Submitted 2003 Budget exceeds an
amount equal to 1.1 multiplied by the aggregate
committed funding of IGEN set forth in the budget for
fiscal year 2002 approved or deemed approved pursuant
to Section 2.8.2, (ii) if the Budget Committee,
without making a reasonable good faith determination,
determines not to approve such Submitted 2003 Budget,
and (iii) if the Budget Committee delivers a Budget
Rejection Notice regarding the Submitted 2003 Budget
to MSD within the 2003 Approval Period, then, in
addition to any rights MST and MSD may have under
Section 8.5.3. or otherwise, IGEN shall be
-12-
obligated to provide the funding contemplated in
Section 2.8.3.(b) in accordance therewith.
(e) If (i) the Budget Committee delivers written
notice to MSD of its approval of the Submitted 2003
Budget or the Alternate 2003 Budget, as the case may
be, within the 2003 Approval Period or (ii) the
Budget Committee fails to deliver either written
notice to MSD of its approval of the Submitted 2003
Budget or the Alternate 2003 Budget, as the case may
be, or a Budget Rejection Notice regarding the
Submitted 2003 Budget or Alternate 2003 Budget, as
the case may be, within the 2003 Approval Period,
then the 2003 Submitted Budget or 2003 Alternate
Budget, as the case may be, shall be approved as of
the date of such written notice (or, in the event no
notice is received within the 2003 Approval Period,
shall be deemed approved as of the last day of the
2003 Approval Period), and IGEN shall provide
Additional Funding for the 2003 fiscal year
consistent with Section 2.4.3. Once approved or
deemed approved, as the case may be, the Submitted
2003 Budget or the Alternate 2003 Budget, as
applicable, shall replace the budget approved or
deemed approved pursuant to Section 2.8.2. hereof for
the period beginning January 1, 2003.
2.8.4. Quarterly Payments. IGEN shall satisfy a
------------------
portion of its commitment to provide Additional
Funding to MSD by making quarterly cash payments to
MSD as follows:
(a) For the 2001 Fiscal Period IGEN shall
contribute cash to MSD in four (4) quarterly
installments of * each, with the first quarterly
installment due on the Commencement Date and the
remaining three quarterly installments due one every
ninety (90) days thereafter (or if such date is not a
business day, on the next succeeding business day);
provided, however, that, if a budget is approved (or
deemed approved) for fiscal year 2002 pursuant to
Section 2.8.2(e), quarterly cash payments for the
period January 1, 2002 through December 31, 2002
shall be made in accordance with Section 2.8.4.(b).
(b) If a budget is approved (or deemed approved)
for the 2002 fiscal year pursuant to Section
2.8.2(e), for the period January 1, 2002 through
December 31, 2002, IGEN shall contribute cash to MSD
in four (4) quarterly installments of not less than *
each, with the first quarterly installment due on
January 2, 2002 (or within five (5) business days
after the date on which the 2002 Submitted Budget or
2002 Alternate Budget, as the case may
-13-
be, is approved or deemed approved, if later) and the
remaining quarterly installments due on April 1,
2002, July 1, 2002 and October 1, 2002.
(c) If budgets are approved for the 2002 fiscal
year and the 2003 fiscal year, for the period January
1, 2003 through November 30, 2003, IGEN shall
contribute cash to MSD in four (4) quarterly
installments of not less than * each, with the first
quarterly installment due on January 2, 2003 (or
within five (5) business days after the date on which
the 2003 Submitted Budget or 2003 Alternate Budget,
as the case may be, is approved or deemed approved,
if later) and the remaining quarterly installments
due on April 1, 2003, July 1, 2003 and October 1,
2003.
2.8.5. Permitted Budgetary Deviations. In approving
------------------------------
any budget pursuant to Section 2.8.2. or 2.8.3., the
IGEN Committee and the Budget Committee, as the case
may be, shall be deemed to have approved an
additional * of the aggregate amount of the budget
for the applicable budgetary period; it being
understood that this sentence shall not apply to the
2001 Fiscal Period or the approval of the 2001
Budget. The management of MSD, however, shall be
required to seek approval of the Budget Committee for
deviations that exceed * of the aggregate amount of
the budget for the applicable budgetary period,
which, to the extent practicable, shall be sought in
advance.
2.8.6. Termination. Notwithstanding any other
-----------
provision of this Agreement to the contrary, if MSD
consummates one or more Third Party Financings with
aggregate gross proceeds to MSD in excess of the
Financing Threshold, then Section 2.8. and all the
subsections thereof shall terminate and be of no
force or effect, and MSD shall follow such budget
procedures as shall be agreed upon in connection with
any such Third Party Financing.
2.8.7 Monthly Funding and Reconciliation. With
----------------------------------
respect to the commitment of IGEN to provide
Additional Funding to MSD for the 2001 Fiscal Period,
on a monthly basis during such 2001 Fiscal Period, in
connection with the delivery of a monthly report to
the Budget Committee pursuant to Section 3.12.3
hereof and pursuant to a procedure to be mutually
agreed upon by IGEN and MSD, IGEN and MSD shall
conduct a monthly funding reconciliation and IGEN
shall provide additional funding to MSD or MSD shall
reimburse IGEN for funding
-14-
already provided to MSD, as necessary, consistent
with the principles set forth in (a) through (d)
below:
(a) For the period from the Commencement Date through
February 14, 2002, (i) to the extent that during any
month IGEN has not provided Additional Funding to MSD
(excluding the quarterly payments contributed to MSD
by IGEN pursuant to Section 2.8.4(a)) in an amount
equal to * (consistent with the 2001 Budget), IGEN
shall pay in cash to MSD an amount equal to the
difference for expenditures incurred by MSD and (ii)
to the extent that during any month IGEN has provided
Additional Funding to MSD (excluding the quarterly
payments contributed to MSD by IGEN pursuant to
Section 2.8.4(a)) in an amount in excess of *
(consistent with the 2001 Budget), MSD shall
reimburse to IGEN, in cash, an amount equal to such
excess.
(b) For the period from February 15, 2002 through
August 14, 2002 (assuming no additional discretionary
funding), (i) to the extent that during any month
IGEN has not provided Additional Funding to MSD
(excluding the quarterly payments contributed to MSD
by IGEN pursuant to Section 2.8.4(a)) in an amount
equal to * , IGEN shall pay in cash to MSD an amount
equal to the difference for expenditures incurred by
MSD and (ii) to the extent that during any month IGEN
has provided Additional Funding to MSD (excluding the
quarterly payments contributed to MSD by IGEN
pursuant to Section 2.8.4(a)) in an amount in excess
of * , MSD shall reimburse to IGEN, in cash, an
amount equal to such excess. If any additional
discretionary funding is approved by IGEN for the
period from February 15, 2002 through August 14,
2002, such additional * monthly funding amount for
the period from February 15, 2002 through August 14,
2002 would be appropriately adjusted.
(c) IGEN and MSD shall mutually agree on appropriate
procedures to implement the principles set forth in
this Section 2.8.7 and to account for any partial
month and/or transition periods.
(d) Any amount of cash paid by IGEN to MSD or by MSD
to IGEN pursuant to this Section 2.8.7 shall be
consistent with Exhibit I hereto and any
discrepancies with respect to any such payment shall
be resolved by IGEN and MSD in connection with MSD's
submission of a Quarterly Report pursuant to Section
3.12.2 hereof and in accordance with Section 3.12.5
hereof.
-15-
2.8.8 Funding and Reconciliation of Future Budgets. In
--------------------------------------------
connection with any budget approved for the 2002 fiscal year or
the 2003 fiscal year, IGEN and MSD shall mutually agree upon
appropriate funding and reconciliation procedures consistent
with such budget and Exhibit I hereto and any discrepancies with
respect to any payments made with respect thereto shall be
resolved by IGEN and MSD in connection with MSD's submission of
a Quarterly Report pursuant to Section 3.12.2 hereof and in
accordance with Section 3.12.5 hereof."
7. Business of the Joint Venture.
-----------------------------
(A) Section 3.1. is hereby amended by replacing the last sentence
thereof with the following:
"Notwithstanding anything to the contrary contained in this
Agreement, the Board of Managers shall retain sole
responsibility for the management of MSD's available funds and
may invest such funds in any manner, in its sole discretion,
including, without limitation, investing available funds in any
one or more of the following: (a) bank accounts, including
savings accounts and money market accounts of banks or trust
companies; (b) direct obligations of the United States or any
instrumentality thereof; (c) money market or other mutual funds;
(d) debt or equity securities of publicly traded companies; and
(e) other investments as may be determined by the Board of
Managers in its sole discretion."
8. Facilities. The first and second sentences of Section 3.5. are
----------
hereby amended and restated as follows:
"IGEN shall provide MSD with office and laboratory facilities
reasonably suitable for the conduct of the Research Program at
IGEN's facility in Gaithersburg, Maryland (and such other IGEN
or MSD facility or facilities as IGEN and/or MSD may occupy in
place of, or in addition to, the Gaithersburg, Maryland
facility). IGEN shall be obligated to provide such facilities
and the costs of operating the same to MSD on such terms as the
parties agree, consistent with Exhibit I."
9. Research Personnel.
------------------
(A) Section 3.6. is hereby amended by adding the following after the
first sentence thereof:
-16-
"From and after January 1, 2001, IGEN's funding of the IGEN
Research Personnel shall be treated as Class C capital
contributions to MSD to the extent provided in Exhibit I
hereto."
(B) Section 3.6. is hereby further amended by deleting the original
third, fourth, sixth and seventh sentences thereof.
(C) The original fifth sentence of Section 3.6. is hereby amended
and restated in its entirety as follows:
"The IGEN Research Personnel shall, unless otherwise agreed by
MSD and IGEN, devote substantially all of their research time to
the conduct of the Research Program."
(D) The eighth sentence of the original version of Section 3.6 is
hereby deleted in its entirety and replaced with the following:
"IGEN hereby assigns to MSD all information, inventions,
improvements, compositions of matter, processes, material, data,
drawings, and know-how, whether or not patented or patentable,
developed by employees, consultants, contractors, or other
personnel of IGEN, including, without limitation, the IGEN
Research Personnel, that are within the definitions of Research
Program or Research Technologies (each a "Development")
including, without limitation, Developments made prior to the
date hereof."
10. Other Services and Support.
--------------------------
(A) Section 3.7. is hereby amended by replacing the last sentence of
the first paragraph thereof with the following:
"From and after January 1, 2001, IGEN's funding of such services
shall be treated as Class C capital contributions to MSD to the
extent provided in Exhibit I hereto."
(B) Section 3.7. is hereby further amended by deleting the original
second and sixth sentences thereof.
(C) The original seventh sentence of Section 3.7. is hereby amended
and restated in its entirety as follows:
"The value of any services and materials that IGEN provides
shall be treated as Class C capital contributions to the extent
provided in Exhibit I hereto."
-17-
11. Distribution.
------------
(A) The second sentence of Section 3.8. is hereby amended and
restated in its entirety as follows:
"If MSD wishes to do so, IGEN will agree to distribute any MSD
product on terms consistent with the terms of Exhibit I hereto."
(B) The last sentence of Section 3.8. is hereby amended and restated
in its entirety as follows:
"For clarification, and notwithstanding Sections 1.11(i) and
1.11(iii), IGEN may manufacture, market and sell * ; provided,
however, that the *; provided further, that * (e.g. there are
no *)."
12. Publication Control. Section 3.9. is hereby amended by deleting
-------------------
the word "application" each of the two times it appears therein and replacing it
in each such case with the word "applications".
13. Employment of Xxxxxxxxxxx. Section 3.11. is hereby amended and
-------------------------
restated in its entirety as follows:
"3.11. Employment of Xxxxxxxxxxx. MSD will repay to Xxxxxxxxxxx
-------------------------
his reasonable travel expenses and other out-of-pocket expenses
involved in providing technical assistance and guidance to the
Research Program, and legal expenses in establishing and
maintaining this Agreement and the relationship (including the
Employment Agreement, as defined below). All such expenses paid
by IGEN, with the exception of legal and other expenses incurred
prior to the date hereof (i.e., November 30, 1995), or incurred
in establishing this Agreement, shall be deemed Class C capital
contributions of IGEN to MSD. In addition, MSD and Xxxxxxxxxxx
will enter into a written employment agreement (the "Employment
----------
Agreement") reasonably satisfactory to the Members and
---------
Xxxxxxxxxxx. All compensation paid and benefits provided to
Xxxxxxxxxxx pursuant to the Employment Agreement are and shall
be paid and provided to Xxxxxxxxxxx by IGEN and/or MSD (and MSD
is and shall be promptly reimbursed by IGEN for the amount of
such compensation paid and the cost of such benefits provided by
MSD) in accordance with the terms and conditions of the
Employment Agreement, and all such amounts paid and all such
costs incurred with respect to the Employment Agreement shall be
deemed to be Class C capital contributions by IGEN to MSD,
except as otherwise provided in the Employment Agreement."
-18-
14. Operation of MSD. Section 3. is hereby amended by adding a new
----------------
Section 3.12. thereto as follows:
"3.12. Reports.
-------
3.12.1. Fiscal Year Reports. Within ninety (90) days after the
-------------------
end of each fiscal year of MSD, the management of MSD, in
consultation with the Board of Managers of MSD, shall prepare
and submit, or cause to be prepared and submitted, to MST and
the Budget Committee the following financial statements which
will have been prepared in accordance with generally accepted
accounting principles consistently applied (the "Annual
------
Financial Statements"): (a) a balance sheet of MSD as at the end
--------------------
of such year; (b) a statement of income or loss of MSD for such
year; and (c) a statement of cash flows of MSD for such year.
Within 90 days after the end of each fiscal year of MSD, the
management of MSD, in consultation with the Board of Managers,
shall prepare and submit, or cause to be prepared and submitted
to MST and the Budget Committee, a statement, which may be
included in the Annual Financial Statements, showing the
balances in each Member's Capital Account (as defined in the LLC
Agreement).
3.12.2. Quarterly Reports. Within thirty (30) days after the end
-----------------
of each fiscal quarter of MSD, the management of MSD, in
consultation with the Board of Managers of MSD, shall prepare
and submit, or cause to be prepared and submitted, to MST and
the Budget Committee: a quarterly report (a) of the financial
condition and results of operations of MSD, together with a
summary of current development and research activities,
including Developments and MSD Improvements and other
discoveries, inventions or improvements in connection with the
Research Program; (b) offering a comparison of income and
investments to the business plan and the then applicable budget
(together with a plan for achieving projected income and
expenses where the deviation from the then applicable budget
equals or exceeds *); and (c) offering an operations review for
the preceding quarter ("Quarterly Report"). Each Quarterly
----------------
Report shall be deemed to be consistent in all material respects
with the methodologies set forth on Exhibit I hereto (the "Joint
-----
Venture Methodologies") and any other methodologies mutually
---------------------
agreed upon in writing by IGEN, MSD and MST ("Other
-----
Methodologies") and each summary of current development and
-------------
research activities included in a Quarterly Report shall be
deemed accepted unless the Budget Committee or MST in good
-19-
faith provides written notice, within 20 days after delivery of
such Quarterly Report by the management of MSD pursuant to this
Agreement (a "Quarterly Report Objection Notice"), to the other
---------------------------------
parties hereto of any discrepancies between the Quarterly Report
and the Joint Venture Methodologies and the Other Methodologies
(if any) or of any discrepancies concerning the summary of
current development and research activities. All discrepancies
specified in a timely submitted Quarterly Report Objection
Notice shall be resolved in accordance with Section 3.12.5.
hereof.
3.12.3. Monthly Reports. On a monthly basis, the management of
---------------
MSD, in consultation with the Board of Managers of MSD, shall
submit a report to MST and the Budget Committee regarding the
financial condition and results of operations of MSD and a
comparison of income and expenses to the then applicable budget.
The parties agree that the first monthly report shall cover the
period from the date of execution and delivery of the Amendment
No. 1 to Joint Venture Agreement by and among MSD, MST and IGEN
through September 30, 2001.
3.12.4. Termination of Reporting Obligation. If MSD consummates
-----------------------------------
one or more Third Party Financings with aggregate gross proceeds
to MSD in excess of the Financing Threshold, then Section 3.12.
shall terminate and be of no force or effect, and the management
of MSD, in consultation with the Board of Managers, shall
prepare and submit, or cause to be prepared and submitted, to
the Members such reports as shall be agreed upon in connection
with any such Third Party Financing.
3.12.5. Resolution of Discrepancies. The parties will first
---------------------------
attempt to have their respective representatives (as specified
in Section 7.2. of this Agreement) resolve all discrepancies
specified in a timely submitted Quarterly Report Objection
Notice pursuant to Section 3.12.2. through good faith
negotiations. Any such discrepancies not thus resolved within
twenty (20) days or such other period of time as the parties
shall mutually agree in writing, shall be settled by final and
binding arbitration in accordance with Section 7.2 hereof."
15. *
(A) The first sentence of Section 4.1 is hereby amended by (i)
deleting the phrase "and Xxxxxxxxxxx'x" therefrom, and (ii) deleting the
phrase "MST, IGEN, nor Xxxxxxxxxxx" and replacing it with the phrase "MST
nor IGEN".
-20-
(B) Section 4.1 is hereby amended by deleting the second sentence
thereof.
(C) Section 4.1 is hereby amended by inserting the following after
the original third sentence thereof:
"For purposes of the immediately preceding sentence, upon a
Change in Control and notwithstanding clause (iii) of Section
1.11, IGEN shall be permitted to use its technology to develop,
manufacture, market or sell * only to the extent such * do not
(i) * or the * of the *, or (ii) * contained in * . For purposes
of the sentence immediately preceding the previous sentence,
upon a Change in Control and notwithstanding clause (ii) of
Section 1.11, IGEN shall be permitted to use its technology to
develop, manufacture, market or sell * only to the extent such *
do not (x) * or the * of the *, or (y) utilize *."
16. Royalties. The first sentence of Section 4.3.2. is hereby
---------
amended by inserting the phrase "distributed by IGEN at MSD's request pursuant
to a mutually agreed-upon distribution agreement" before the "." at the end of
the sentence.
17. Use of Confidential Information.
-------------------------------
(A) The first sentence of Section 5.3 is hereby amended by (i)
inserting the phrase ", the IGEN/MSD License Agreement, the MSD/MST Sublicense
Agreement," after the phrase "authorized by this Agreement" and (ii) deleting
the phrase "Section 6.1 hereof" and replacing it with the phrase "the LLC
Agreement".
(B) Section 5.3 is hereby amended by inserting the following at the
end of the second sentence: "; provided, however, that MSD may file patent
applications or similar documents for information, inventions, improvements,
compositions of matter, processes, material, data, drawings or know-how arising
out of or related to the Research Program, Research Technologies or Research
Outline without the prior written consent of IGEN".
(C) The last sentence of Section 5.3. is hereby amended by inserting
the clause "or expiration" between the clauses "following termination" and "of
this Agreement".
18. Rights and Obligations Regarding MSD Membership Interests.
---------------------------------------------------------
Section 6. is hereby amended by deleting the heading and text of such section in
their entirety, and the following is substituted therefore: "[Provision
Intentionally Omitted]".
19. Disputes Concerning Contractual Obligations. Section 7.2. is
-------------------------------------------
hereby amended and restated in its entirety as follows:
-21-
"7.2. Disputes Concerning Contractual Obligations. Upon
-------------------------------------------
execution of this Agreement, each party hereby designates the
person listed opposite its name to act as its representative who
shall have the initial responsibility for discharging or causing
to be discharged the responsibility of that party for the
performance of this Agreement:
Party Representative
----- --------------
MSD: Chief Executive Officer
IGEN: Xxxxxxx X. Xxxxxx
MST: Xxxxx Xxxxxxxxxxx
In the event that any dispute arising out of, or related to this
Agreement (except for any dispute concerning the Research
Program or operating plan resolved pursuant to Section 7.1.
hereof or any dispute resolved pursuant to Section 3.12.5. or
Section 8.5.4.), or the breach, termination or validity hereof,
cannot be resolved by the representatives of the parties within
twenty (20) days, such dispute may be referred by either party
for resolution by final and binding arbitration conducted in
Washington, D.C. If the Members are able to select a mutually
agreed upon arbitrator, the dispute will be resolved by such
arbitrator. However, in the event that the Members are unable to
agree upon a single arbitrator within ten (10) days after having
received written notice from a party requesting that an
arbitrator be selected, the dispute shall be resolved by three
arbitrators, selected as stated below, under the commercial
arbitration rules of the American Arbitration Association
("AAA") then in effect. Arbitration of any such issue may be
commenced by written notice from one party to the other
designating the arbitrator selected by the party giving such
notice. The party receiving such written notice shall within
thirty (30) days designate a second arbitrator and the two
arbitrators together shall mutually select a neutral third
arbitrator. Each arbitration shall be conducted at a site
selected by the three arbitrators. The arbitrators shall have no
power to add to, subtract from or modify any of the terms or
conditions of this Agreement. The arbitrators shall render their
decision in writing within sixty (60) days of the hearing and
shall provide the bases on which they reached their decision.
The arbitrator(s) selected shall have expertise in the nature of
the matters in dispute. Any award rendered in such arbitration
may be enforced by either party in any court or forum (state or
-22-
federal) having jurisdiction, to whose jurisdiction for such
purposes each Member hereby irrevocably consents and submits.
Each party shall bear its own expenses and shall equally share
the filing and other administrative fees of the AAA and the
arbitrator(s). However, the arbitrator(s) shall have the
discretion to allocate the cost and expenses of the arbitration
among the parties as they deem appropriate, but not legal fees.
This provision shall be governed and enforceable under the
Federal Arbitration Act, 9 U.S.C. (S)(S)1-16. The statute(s) of
limitations applicable to any dispute shall be tolled upon
initiation of the dispute resolution procedures under this
provision and shall remain tolled until the dispute is resolved
under this provision. However, tolling shall cease if the
aggrieved party does not file a demand for arbitration of the
dispute with the AAA within sixty (60) calendar days after good
faith negotiations have been terminated in writing by either
party."
20. Term. Section 8.1. is hereby amended and restated in its
----
entirety as follows:
"8.1. Term. Except as otherwise agreed by the Members, the term
----
of this Agreement shall expire on the earlier of November 30,
2003, or such time as MSD shall be unable to continue operations
as a result of a lack of funds."
21. Extension of Term.
-----------------
(A) Section 8.2. is hereby amended by replacing the first sentence
thereof with the following:
"At or prior to the time the term of this Agreement is set to
expire pursuant to Section 8.1., MSD shall prepare and submit to
IGEN a written research plan and budget (the "Additional
----------
Research Budget") for the conduct of additional research."
---------------
(B) Section 8.2 is hereby further amended by replacing the last
sentence thereof with the following:
"Unless the parties otherwise agree during any such extended
term, this Agreement shall terminate upon the expiration of such
extended term."
-23-
22. Termination for Breach. Section 8.4. is hereby amended and
----------------------
restated in its entirety as follows:
"8.4. Termination for Breach or Failure to Approve Budget.
8.4.1. MST and MSD shall be entitled to terminate this Agreement
(i) if IGEN shall have defaulted on its obligations to fund the
Research Program pursuant to this Agreement, which default
continues for more than thirty (30) days after written notice of
such noncompliance or (ii) upon any failure by IGEN to comply
with any material provision of this Agreement or any of the
other agreements or documents executed and delivered in
connection with this Agreement and the extension thereof, which
failure (a) would reasonably be expected to have a material
adverse effect on the business or operations of MSD, and (b)
continues for more than thirty (30) days after written notice of
such noncompliance.
8.4.2. In the event that MSD shall terminate Xxxxxxxxxxx'x
employment under the Employment Agreement other than for "Cause"
(as defined in the Employment Agreement) or other than because
of "Disability" (as defined in the Employment Agreement) or
Xxxxxxxxxxx shall be entitled to terminate his employment
thereunder for "Good Reason" (as defined in the Employment
Agreement), MST and MSD shall be entitled to terminate this
Agreement; provided, however, that, in the event of a Change in
Control under clause (a) of the definition of Change in Control,
this Agreement may not be terminated until the person triggering
such Change in Control has acquired ownership, control, power to
vote or beneficial ownership of 30% or more of any class of
voting securities of IGEN.
8.4.3. In the event that the Budget Committee delivers notice to
MSD of its decision not to approve a submitted budget in the
circumstances described in and as contemplated in Sections
2.8.2.(b) or (d) or Sections 2.8.3.(b) or (d), MST and MSD shall
be entitled to terminate this Agreement.
8.4.4. Upon the occurrence of any event giving rise to a right
to terminate this Agreement under this Section 8.4., then
notwithstanding any applicable provision of this Agreement or
the LLC Agreement, and unless and until either clause (i) or
(ii) of this Section 8.4.4. becomes applicable, all votes and
decisions of the Board of Managers thereafter shall be
determined by majority vote based on the Percentage Interests of
the Class A
-24-
Members of MSD, with the representative to the Board of Managers
appointed by IGEN entitled to cast a percentage of the votes
equal to IGEN's Percentage Interest at the time, and the
representative to the Board of Managers appointed by MST
entitled to cast a percentage of the votes equal to MST's
Percentage Interest at the time, unless and until either (i) MSD
and/or MST fail to deliver to IGEN a Valuation Election Notice
prior to the expiration of the time period for delivery of such
notice specified in Section 8.5.3.(a) hereof with respect to the
event which gave rise to such right to terminate, or (ii) MSD
and/or MST timely deliver to IGEN a Valuation Election Notice
but fail to deliver to IGEN a Purchase Election Notice prior to
the expiration of the time period for delivery of such notice
specified in Section 8.5.3.(b) hereof with respect to the event
which gave rise to such right to terminate."
23. Consequences of Termination.
---------------------------
(A) Section 8.5.2. is hereby amended by deleting the text of such
section in its entirety, and the following is substituted therefor: "[Provision
Intentionally Omitted]".
(B) Section 8.5.3. is hereby amended and restated in its entirety as
follows:
"8.5.3. (a) In the event this Agreement expires as provided in
Section 8.1. and it is not extended as provided in Section 8.2.,
or in the event this Agreement is extended, but upon the
expiration of the extended term, is not further extended, or in
the event this Agreement is terminated pursuant to Section
8.4.1., Section 8.4.2. or Section 8.4.3., then MSD and MST shall
jointly have the right to purchase all of IGEN's interest as a
Class A Member, Class B Member and Class C Member of MSD (the
"IGEN Interests") by paying to IGEN the purchase price
--------------
determined pursuant to Section 8.5.4. (the "Purchase Price") in
--------------
accordance with this Section 8.5.3. To elect to invoke the
provisions of this Section 8.5.3., MSD and/or MST (the
"Purchaser") shall provide IGEN with written notice of such
---------
election (the "Valuation Election Notice") within ninety (90)
-------------------------
days after the occurrence of any event giving rise to their
rights to purchase the IGEN Interests hereunder.
(b) The Purchaser shall have a period of sixty (60) days after
the Purchase Price has been determined pursuant to Section
8.5.4. (the "Purchase Election Period") in which to elect
------------------------
-25-
to consummate the purchase of the IGEN Interest at the Purchase
Price (a "Purchase Election"). The Purchaser shall make the
----------------- Purchase Election by delivering written notice
of its election (the "Purchase Election Notice") to IGEN on or
before the last ------------------------ day of the Purchase
Election Period. The unpaid amount of the Purchase Price
outstanding from time to time shall bear simple interest
(cumulated, not compounded) at the fixed annual rate equal to the
Prime Rate (as defined in the LLC Agreement) in effect as of the
date of the Purchase Election Notice, plus one-half of one
percent (0.5%). As security for its obligation to pay the
Purchase Price, plus interest, to IGEN hereunder, Purchaser
hereby grants to IGEN a first priority security interest in all
of the IGEN Interests so purchased. Purchaser shall cause the
entry of an appropriate notation in the records of MSD to reflect
such security interest. Purchaser shall be required to make
payments to IGEN with respect to the unpaid amount of the
Purchase Price, plus accrued interest as follows: (i)* of the
amount of MSD Net Sales (as defined below), and (ii) * of the net
proceeds realized by MSD from the sale of its debt or equity
securities in any third party financing (including debt
financings through term loans or sale leaseback transactions in
either case having a term of greater than one year, but excluding
debt financings through revolving credit facilities, lines of
credit and lease financing transactions) received after the date
of the sale of the IGEN Interests. Such payments shall be made
within thirty (30) business days after MSD receives the MSD Net
Sales or net financing proceeds, as the case may be, and shall
continue until the entire amount of the Purchase Price and all
accrued interest have been paid in full. Purchaser, upon written
notice to IGEN and without penalty, shall be entitled to prepay
all or any part of the outstanding Purchase Price and accrued but
unpaid interest at any time and from time to time. In the event
of any default with respect to Purchaser's payment obligations
hereunder which is not cured within ten (10) business days after
MSD receives written notice thereof, then in addition to any
rights or remedies IGEN has pursuant to Section 8.5.6., IGEN
shall be entitled to exercise its rights with respect to the
pledged IGEN Interests to satisfy the unpaid amount of the
Purchase Price. Upon delivery to IGEN of the Purchase Election
Notice, IGEN shall be deemed for all purposes to have sold, and
Purchaser shall be deemed for all purposes to have purchased the
IGEN Interests, and IGEN shall cease to be a Class A Member,
Class B Member and Class C Member of MSD and shall have no
further rights or obligations as a Member of MSD
-26-
(the "Closing"). IGEN hereby consents to and approves all
-------
actions by MSD as may be required or appropriate to reflect the
sale of the IGEN Interests in accordance with this Section
8.5.3. "MSD Net Sales" shall mean, for any period, the gross
-------------
revenues received by MSD for products commercially sold by MSD
in such period, less (i) trade, cash and quantity discounts or
rebates actually taken or allowed, (ii) credits or allowances
given or made for rejected, damaged or returned goods, (iii)
uncollectable amounts on products previously sold, (iv)
retroactive price reductions and (v) any freight or insurance
charges or taxes billed to the customer.
(c) IGEN covenants and agrees that in the event of a sale of the
IGEN Interests pursuant to this Section 8.5.3., it shall deliver
to the Purchaser good title to the IGEN Interests, free and
clear of any liens or encumbrances (other than IGEN's security
interest therein). IGEN and Purchaser each shall execute and
deliver such documents and instruments of conveyance as may be
necessary or reasonably requested by any of them to effectuate
or evidence the purchase and sale of the IGEN Interests,
including, without limitation, the execution, delivery and
filing of such UCC-1 financing statement(s) as may be reasonably
requested by IGEN. Each of IGEN and the Purchaser shall bear its
own expenses associated with the Closing.
(d) Notwithstanding anything to the contrary herein, upon the
Closing, (i) IGEN agrees to irrevocably and unconditionally
release MSD, MST and each of their respective officers,
managers, employees, controlling persons and members from any
claims, actions, suits, proceedings, obligations or other
liabilities arising out of, in connection with, or related to
the business, operations and/or governance of the joint venture
and all agreements or documents executed and delivered in
connection therewith, in each case, as such agreements and
documents existed immediately prior to the Closing, other than
any unresolved claims made by or on behalf of IGEN at any time
prior thereto, including without limitation, any claims relating
to this Section 8.5.3 or the events giving rise to MSD's and
MST's actual or alleged rights to invoke the terms thereof and
(ii) IGEN covenants and agrees that IGEN (or any person acting
on behalf of or at the direction of IGEN) shall not at any time
assert or institute any intellectual property claim, action,
suit or proceeding against MSD or any of its officers, managers,
employees, controlling persons or members relating to (x) any
-27-
patents or patent applications filed by MSD or MST with the
actual knowledge of IGEN prior to the date of delivery of the
Valuation Election Notice or (y) any Confidential Information
constituting results or progress of the Research Program prior
to such date."
(C) Section 8.5.4. is hereby amended and restated in its entirety as
follows:
"8.5.4.(a) For purposes of Section 8.5.3., the Purchase Price
shall be equal to (i) the fair market value of the IGEN
Interests at the time, as determined in accordance with Section
8.5.4.(b) and either Section 8.5.4.(c) or Section 8.5.4.(d), as
applicable ("FMV"), reduced by (ii) the highest of the discount
factors set forth in Section 8.5.4.(e) that are applicable.
(b) FMV for this purpose shall mean the price at which a willing
buyer would buy, and a willing seller would sell, the IGEN
Interests in an arms-length transaction assuming the IGEN
Interests are sold in an orderly disposition and each of the
buyer and seller are aware of, and take into account, all
relevant factors which exist at the time, including MSD's
earnings, sales, products available for sale, internal risk
factors, competition, resources, sources and cost of funding and
other support, indebtedness (including any indebtedness to fund
the purchase of the IGEN Interests and MSD's ongoing operating
business, but MSD's indebtedness for this purpose shall not
include IGEN's Class C Capital Contribution and related
Preferred Return (each as defined in the LLC Agreement) that are
outstanding prior to payment of the Purchase Price), minority
interest, and general market conditions, provided, however, that
(I) such determination shall not take into account whether any
discount will be applied pursuant to Section 8.5.4.(e) and (II)
for purposes of making such determination only, it shall be
assumed that MSD is the owner of all of the MST patents where
there is an inventor listed on such patent application and/or
patent registration other than or in addition to Xxxxxxxxxxx,
and such other inventor was an employee of either MSD or IGEN at
the time of invention, as such assumed patent ownership is
limited or affected by the business of MSD and by existing
licenses to IGEN, MST or other third party licensees.
(c) For thirty (30) calendar days following the delivery of the
Valuation Election Notice to IGEN, IGEN and the Purchaser shall
negotiate in good faith to attempt to agree on the FMV
-28-
without resorting to the appraisal process set forth in Section
8.5.4.(d).
(d) In the event IGEN and the Purchaser are unable or fail to
agree on the FMV within the thirty (30) day period set forth in
Section 8.5.4.(c), the FMV shall be determined as of the last
day of such thirty (30) day period pursuant to the appraisal
process set forth in this Section 8.5.4.(d). Either Purchaser or
IGEN, by written notice to the other, shall designate an
appraiser (the "First Appraiser"). The party that receives such
---------------
notice then shall have ten (10) business days after receiving
such notice to designate a second appraiser (the "Second
------
Appraiser") by written notice to the other party. If the
---------
receiving party fails to timely designate a Second Appraiser,
FMV shall be determined by the First Appraiser.
The First Appraiser and, if applicable, the Second Appraiser
each shall separately determine the FMV in accordance with this
Section 8.5.4. and shall provide a detailed written valuation
report to each of IGEN and the Purchaser within forty five (45)
days after the last day for designating the Second Appraiser
pursuant to this Section 8.5.4.(d). If only one appraiser timely
submits a proper valuation report, its determination of FMV
shall be final and conclusive. If both appraisers timely submit
proper valuation reports, and their FMV determinations vary by
ten percent (10%) or less, FMV shall be equal to the average of
the two determinations. If both appraisers timely submit proper
valuation reports, and their FMV determinations vary by more
than ten percent (10%), the two appraisers shall promptly
appoint a third appraiser (the "Third Appraiser"), which shall
---------------
independently determine the FMV in accordance with this Section
8.5.4. and shall provide a detailed written valuation report to
each of IGEN and the Purchaser within forty five (45) days after
its appointment. FMV shall then be equal to the average of the
two closest of the three FMV determinations submitted by the
three appraisers. The FMV as determined in accordance with this
Section 8.5.4. shall be final and binding on IGEN and the
Purchaser.
In preparing its FMV determination, each appraiser shall be
provided with the same company-specific source documents and
information and the same access to management. Each appraiser
shall determine a single point estimate of FMV, not a range of
values. Only qualified appraisers with prior experience
appraising the value of businesses comparable to that of MSD
-29-
and that do not have any financial interest in any
Member (excluding any existing or prior agreement or
contractual arrangement to provide advisory or
appraisal services to the Member) may be validly
appointed to serve as an appraiser hereunder. IGEN
shall pay all fees and costs of the appraiser
designated by it and one-half of all fees and costs
of the Third Appraiser, if any. Purchaser shall be
responsible for all fees and costs of the appraiser
designated by it and one-half of all the fees and
costs of the Third Appraiser, if any, provided that,
at Purchaser's election, as specified by Purchaser
in the Purchase Election Notice, IGEN shall pay such
fees and costs and such fees and costs may be added
to the Purchase Price.
(e) After the FMV has been determined pursuant to
Section 8.5.4.(b) and either Section 8.5.4.(c) or
8.5.4.(d), as applicable, the Purchase Price shall be
equal to such FMV minus the product of such FMV
multiplied by the highest of the following discount
factors that are applicable:
(i) termination of this Agreement pursuant
to Section 8.4.1. hereof: 15%;
(ii) termination of this Agreement pursuant
to Section 8.4.2. hereof except where
"Good Reason" (as defined in the
Employment Agreement) is based on
Section 6(d)(2)(E), 6(d)(2)(G),
6(d)(2)(J) or 6(d)(2)(K) of the
Employment Agreement: 15%;
(iii) termination of this Agreement pursuant
to Section 8.4.2. hereof where "Good
Reason" (as defined in the Employment
Agreement) is based on Section
6(d)(2)(E) of the Employment
Agreement: 7.5%;
(iv) non-renewal of this Agreement pursuant
to Section 8.2. hereof or termination
of this Agreement pursuant to Section
8.4.2. hereof where "Good Reason" (as
defined in the Employment Agreement)
is based on Section 6(d)(2)(G) of the
Employment Agreement: 7.5%;
(v) termination of this Agreement pursuant
to Section 8.4.2. hereof arising in
connection with the occurrence of a
Change in Control of
-30-
IGEN as set forth in Section 6(d)(2)(J)
of the Employment Agreement: 10%; and
(vi) termination of this Agreement pursuant
to Section 8.4.3. hereof or termination
of this Agreement pursuant to Section
8.4.2. hereof where "Good Reason" (as
defined in the Employment Agreement) is
based on Section 6(d)(2)(K) of the
Employment Agreement: 7.5%."
(D) Section 8.5.5. is hereby amended and restated in its entirety as
follows:
"8.5.5. In the event that this Agreement expires or is
terminated and MSD and MST exercise their rights under Section
8.5.3., IGEN hereby agrees to (i) remove from the Board of
Managers its designee and elect a second designee of MST, (ii)
vote all of its Voting Interest in the manner requested by MST;
provided, that in the case of the exercise by MSD and MST of
their rights under Section 8.5.3., IGEN shall not be obligated
to vote in favor of any amendment to the LLC Agreement (if IGEN
is a Member) that would diminish IGEN's priority position with
respect to the payment to IGEN of Net Profits (as defined in the
LLC Agreement) of MSD, (iii) otherwise provide reasonable
cooperation and provide such consents (including the execution
and delivery of such amendments to this Agreement and other
documents as may be reasonably required) to permit MSD to raise
additional capital; and (iv) the termination of its status as a
party to the MST/MSD License, and MSD and MST hereby agree to
such termination of IGEN's status as a party."
(E) Section 8.5. is hereby amended by adding a new Section 8.5.6.
thereto as follows:
"8.5.6. In the event that MST is in default of its obligation to
pay the Purchase Price (plus interest) to IGEN in accordance
with Section 8.5.3., and such default has not been cured within
thirty (30) days after receipt by MST of written notice from
IGEN of such default (a "Payment Obligation Default"):
--------------------------
(a) MST hereby agrees to appoint as a member of the Board of
Managers of MSD, one person designated by IGEN to serve as a
member of the Board of Managers of MSD (irrespective of the
number of members then serving on the Board of Managers of
-31-
MSD) until the earlier of (i) the date on which the Purchase
Price (plus interest) is paid in full to IGEN; and (ii) the date
on which the Payment Obligation Default is cured. IGEN, MST and
MSD acknowledge and agree that any such representative of IGEN
to the Board of Managers of MSD pursuant to this Section
8.5.6.(a) shall be subject to the reasonable approval of MST,
which approval shall not be unreasonably withheld or delayed.
IGEN hereby agrees to cause any such representative to the Board
of Managers of MSD to resign from the Board of Managers of MSD
immediately in the event IGEN is no longer entitled to a
representative in accordance with this Section 8.5.6.
(b) An amount equal to 15% of the Purchase Price which remains
unpaid by MST to IGEN as of the date of the default (the
"Default Payment Amount") shall be automatically added to the
----------------------
then outstanding principal amount of the Purchase Price and
become payable in accordance with Section 8.5.3."
24. Miscellaneous Provisions.
------------------------
(A) Section 10.5.(a) is hereby amended by deleting the facsimile
number "(000) 000-0000" and replacing it with the facsimile number "(301)
947-7240".
(B) Section 10.5.(b) is hereby amended and restated in its entirety
as follows:
"(b) If to IGEN:
IGEN International, Inc.
00000 Xxxxxxxxxx Xxxxx
Xxxxxxxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxx, Ph.D.
Facsimile: (000) 000-0000
with a copy (which shall not constitute notice) to:
IGEN International, Inc.
00000 Xxxxxxxxxx Xxxxx
Xxxxxxxxxxxx, XX 00000
Attn: General Counsel
Facsimile: (000) 000-0000"
(C) Section 10.5.(c) is hereby amended and restated in its entirety
as follows:
-32-
"(c) If to MST to:
MESO SCALE TECHNOLOGIES, LLC.
0000X Xxxxx Xxxxx Xxxxxxx
Xxxxxxxxx, XX 00000
Attn: Xxxxx X. Xxxxxxxxxxx
Facsimile: (000) 000-0000
with a copy (which shall not constitute notice) to:
Xxxxx & Xxxxxxx L.L.P.
000 Xxxxxxxxxx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
Attn: Xxxxxx X. Xxxxxxx, Esq.
Facsimile: (000) 000-0000"
(D) Section 10.6. is hereby amended and restated in its entirety as
follows:
"10.6 Notwithstanding any other provision of this Agreement or
the LLC Agreement, amendments may be made to this Agreement from
time to time by a writing duly executed by the parties hereto;
provided, however, upon the occurrence of one or more of the
events set forth in Section 8.4. giving rise either to MST's
and/or MSD's right to terminate this Agreement and the delivery
of a Purchase Election Notice under Section 8.5.3.(b) hereof,
amendments may be made to this Agreement from time to time by a
writing duly executed by Class A Members representing a majority
of the Percentage Interests."
(E) Section 10.7. is hereby amended and restated in its entirety as
follows:
"10.7. The provisions of Section 3.6. beginning with the fifth
sentence thereof through the end of such section, the first
sentence of Section 4.1. for purposes of Section 4.3.1 only and
the provisions of Sections 2.8.2.(b), 2.8.2.(d), 2.8.3.(b),
2.8.3.(d), 3.8., 4.2., 4.3., 5. (other than the last sentence of
Section 5.5.), 7., 8., 9., 10.1., 10.2., 10.3., 10.4., 10.5.,
10.6., 10.7., 10.8., 10.9., 10.11., 10.12., 10.13., 10.17. and
10.18. shall survive expiration or termination for any reason of
this Agreement. Except as otherwise expressly provided in this
Agreement, the expiration or termination of this Agreement shall
not prejudice or extinguish any rights or obligations of the
parties which arose or
-33-
accrued in accordance with the terms of this Agreement prior to
such expiration or termination."
(F) Section 10. is hereby amended by adding a new Section 10.13.,
Section 10.14., Section 10.15., Section 10.16., Section 10.17., Section 10.18.
and Section 10.19. thereto as follows:
"10.13. In the event MSD consummates one or more Third Party
Financings with aggregate gross proceeds to MSD in excess of the
Financing Threshold and IGEN has no obligation to provide any
additional funding to MSD pursuant to this Agreement, MST and
IGEN shall discuss entering into, and negotiate in good faith
documentation for, arrangements governing the exchange of
information, services and other assistance, as well as the
ownership and allocation of expenses with respect to joint
projects and developments, on mutually acceptable terms to
enable each of MSD and IGEN to efficiently manage and otherwise
support its respective business and avoid duplicative
expenditures.
10.14. The Board of Managers of MSD shall adopt and implement an
incentive compensation plan (the "Employee Incentive Plan") with
-----------------------
respect to the grant or award of newly issued or other equity
interests of MSD representing up to * of the outstanding
Percentage Interests of MSD as of January 1, 2001 to employees
of MSD or any subsidiaries of MSD which may be established,
subject to the following terms:
(a) The grant or award of newly issued equity interests of MSD
constituting up to * of the outstanding Percentage Interests of
MSD as of January 1, 2001 under the Employee Incentive Plan
shall be effected in such manner as to dilute on a proportionate
basis the respective Percentage Interests of MST and IGEN so
that as a result of the grant or award of such specified equity
interests, IGEN's Percentage Interest as a Member of MSD would
be reduced from 31% to * and MST's Percentage Interest as a
Member of MSD would be reduced from 69% to * .
(b) The grant or award of equity interests of MSD constituting
the remaining * of the outstanding Percentage Interests of MSD
as of January 1, 2001 under the Employee Incentive Plan shall be
effected in such manner as to dilute only MST's outstanding
Percentage Interest as a Member of MSD and IGEN would not as a
result of such grant or award incur
-34-
any additional dilution beyond the * described in subparagraph
(a) above. The specific arrangements for effecting the grant or
award of such equity interests under the Employee Incentive Plan
pursuant to this subparagraph (b) shall be determined in the
sole discretion of the MST Manager in accordance with the terms
of this Section 10.14.
(c) No grant or award may be made to Xxxxxxxxxxx under the
Employee Incentive Plan without the prior approval of a majority
of the members of an independent committee of the Board of
Directors of IGEN. No grant or award made to Xxxxxxxxxxx under
the Employee Incentive Plan shall be taken into account for
purposes of computing the Percentage Interest of MST as a Member
of MSD for purposes of this Section 10.14. or otherwise under
this Agreement.
10.15. IGEN and MSD hereby acknowledge that, as the business of
MSD continues to be developed, MSD will require additional
employees and certain IGEN employees may desire to become
employees of MSD. In that connection, and except as otherwise
agreed upon by MSD and IGEN, MSD hereby agrees not to offer
employment to any such IGEN employees until IGEN and MSD have
agreed upon a mechanism satisfactory to both for addressing such
transfers and their consequences.
10.16. Without the prior written consent of IGEN, Xxxxxxxxxxx
shall not sell, assign, pledge, encumber, dispose of, or
otherwise transfer more than 30% of the voting limited liability
company interests of MST owned by Xxxxxxxxxxx as of the date
hereof.
10.17. Notwithstanding any other provision to the contrary
contained herein, and except as otherwise contemplated by
Section 8. with respect to the matters specifically set forth
therein, IGEN hereby agrees that, in its capacity as a Member of
MSD and as a party to this Agreement and acting through its
designee on the Board of Managers (i.e., the IGEN Manager),
IGEN, directly or indirectly, shall not (i) vote against, (ii)
refuse to consent to, (iii) refuse to agree to, or (iv) refuse
to approve, any action requiring the vote, consent, agreement or
approval of the Members or of the parties to this Agreement or
the Board of Managers if such action is supported by MST, in its
capacity as a Member and as a party to this Agreement and acting
through its designee on the Board of Managers (i.e., the MST
Manager), unless a committee of the Board of Directors of IGEN
reasonably concludes that such action is not in the best
interests of IGEN
-35-
and its stockholders; provided that, IGEN hereby agrees that, in
connection with its consideration of such action, IGEN shall
take into consideration the interests of MSD.
10.18. In connection with MSD seeking and obtaining third party
financing, IGEN agrees to cooperate and work in good faith with
MST and MSD and to use its reasonable efforts as requested by
MST to assist in securing third party financing for MSD.
10.19. From time to time during the term of this Agreement, the
Board of Managers of MSD and an independent committee of the
Board of Directors of IGEN shall meet to discuss proposals by
MSD calling for the acceleration of the funding of MSD through
the term of this Agreement, the extension of the term of this
Agreement, and appropriate changes in the management and
governance of MSD, taking into consideration, among other
things, the capital resources of IGEN, the achievement of
performance goals by MSD and third party financing opportunities
for MSD."
25. Equipment. IGEN, MSD and MST hereby acknowledge and confirm that
---------
certain agreements set forth in a separate written agreement have been reached
with respect to, among other things, the contribution to MSD of certain
equipment and the right of reasonable access to and use of certain other
equipment by MSD.
26. Certain Transactions of IGEN. IGEN shall, in connection with any
----------------------------
transaction that is likely to result in a Change in Control of IGEN or any other
similar transactions including any merger, consolidation, reorganization, sale
of assets, distribution of securities or other business combination, provide to
MSD and MST such assurances as may be reasonably requested by MST that any
successor or assignee of IGEN shall duly and punctually perform and observe all
terms, covenants and conditions of the Joint Venture Agreement, the LLC
Agreement, the Employment Agreement, the MST/MSD License Agreement, the IGEN/MSD
License Agreement and any other agreement executed and delivered in connection
therewith, whether according to the present terms hereof or pursuant to any
amendment in the terms, covenants and conditions hereof now or at any time
hereafter made or granted.
-36-
27. Certain Maintenance Expenses. IGEN shall fund the reasonable
----------------------------
legal, accounting, tax and other services and similar expenses MST pays or
incurs in connection with its ownership interest in MSD. Such amounts shall be
funded by IGEN promptly upon the request of MST and shall be treated as Class C
contributions to MSD.
28. Enforcement. Each party hereto hereby agrees and confirms that the
-----------
subject matter of the Joint Venture Agreement is unique. Each of the parties
hereto further acknowledges and agrees that in the event that any party hereto
fails to satisfy its obligations under the Joint Venture Agreement, the other
parties hereto would be irreparably and immediately harmed and could not be made
whole by monetary damages. It is accordingly agreed that (i) each party hereto
waives, in any action for specific performance or injunctive relief, the defense
of adequacy of a remedy at law and (ii) each party hereto shall be entitled, in
addition to any other remedy to which it may be entitled at law or in equity, to
compel specific performance of, or injunctive relief under, the Joint Venture
Agreement. The foregoing right to specific performance or injunctive relief is
in addition to, and not in derogation of, any other statutory, equitable or
common law rights or remedies such party may have with respect to a failure by
any other party hereto to satisfy its obligations under the Joint Venture
Agreement.
29. Construction. Notwithstanding any other provision of the LLC
------------
Agreement or the Joint Venture Agreement to the contrary, including, without
limitation, Articles 8 and 9 of the LLC Agreement, the parties hereby agree that
no consent of IGEN (acting directly or through its designee on the Board of
Managers) shall be required to effect a transfer or other modification of IGEN's
interests in MSD which transfer or other modification is made in accordance with
the terms of Sections 8. or 2.4.3(c) of the Joint Venture Agreement, as
applicable.
30. Representations. Each of MSD, MST and IGEN hereby represents to
---------------
one another that it has the power and authority to enter into this Amendment No.
1 and to perform its obligations under the Joint Venture Agreement, as amended
by this Amendment No. 1, and under this Amendment No. 1, and that its execution,
delivery and performance hereof has been duly and validly authorized (including
in the case of IGEN, approval by the IGEN Committee). Each of MSD, MST and IGEN
hereby represents to one another that its execution and delivery of this
Amendment No. 1 and its performance of the Joint Venture Agreement, as amended
by this Amendment No. 1, will not constitute a breach of and will not conflict
with any agreement or duty to or by which such party is bound, and will not
violate any law or governmental regulation applicable to such party. IGEN hereby
represents to each of MSD and MST that (i) IGEN (acting through its designee on
the IGEN Committee or otherwise) has had the opportunity to review the R&D
Summary 1996, R&D Summary 1997, R&D Summary 1998, R&D Summary 1999, R&D Summary
2000 and R&D Summary January - June 15, 2001 (collectively, the "R&D Summaries")
-------------
submitted by MSD, (ii) IGEN (acting
-37-
through its designee on the IGEN Committee or otherwise) has had the opportunity
to ask questions about the R&D Summaries and receive answers to such questions,
(iii) the R&D Summaries include MSD's research and development efforts in
conducting the Research Program, and (iv) as between IGEN on the one hand and
MSD and MST on the other hand, IGEN hereby agrees that, in accordance with
Sections 3.6 and 4.3 of the Joint Venture Agreement, the research, developments,
ideas, concepts, technologies, methods, information, inventions, improvements,
compositions of matter, processes, material, data, drawings, products, works of
authorship and know-how (collectively, the "Intellectual Property") outlined in
---------------------
the R&D Summaries are the proprietary information and property of MSD and/or
MST, including any Intellectual Property created by employees, consultants,
contractors or other personnel of IGEN, including without limitation the IGEN
Research Personnel.
31. Additional Actions and Documents. Each party hereby agrees to take
--------------------------------
or cause to be taken such further actions, to execute, acknowledge, deliver and
file or cause to be executed, acknowledged, delivered and filed such further
documents and instruments (including an amended and restated version of the
Joint Venture Agreement, as amended by this Amendment No. 1), and to use
commercially reasonable efforts to obtain such consents, as may be necessary or
as may be reasonably requested in order fully to effectuate the purposes, terms
and conditions of the Joint Venture Agreement, as amended by this Amendment No.
1. Such documents and instruments shall include, but not be limited to, reports
and other documentation related to inventions, discoveries, research and
developments with respect to the Research Program and the assignment and
ownership (including the recordation thereof) of such inventions, discoveries,
research and developments.
32. Effect on Joint Venture Agreement. It is the express intention and
---------------------------------
agreement of MSD, MST and IGEN that all provisions of the Joint Venture
Agreement, as amended by this Amendment No. 1, shall survive and remain in full
force and effect following the execution and delivery of this Amendment No. 1,
and the provisions of this Amendment No. 1 shall be considered part of, and
governed by, the terms of the Joint Venture Agreement (as so modified). Unless
the context otherwise requires, any reference to the Joint Venture Agreement as
of and after the date of this Amendment No. 1 (including, as appropriate,
references to "this Agreement" in quoted sections in this Amendment No. 1) shall
be deemed to be a reference to the Joint Venture Agreement, as amended by this
Amendment No. 1.
33. Exhibits and Schedules. Exhibit I to this Amendment No. 1 is
----------------------
hereby deemed to be and become a part of the Joint Venture Agreement and shall
be referred to as Exhibit I.
34. Headings. Section and subsection headings contained in this
--------
Amendment No. 1 are inserted for convenience of reference only, shall not be
-38-
deemed to be a part of this Amendment No. 1 for any purpose, and shall not in
any way define or affect the meaning, construction or scope of any of the
provisions hereof.
35. Governing Law. As this Amendment No. 1 relates to the governance
-------------
and internal affairs of a Delaware limited liability company and relations among
its members, this Amendment No. 1 shall be governed by and interpreted,
construed and enforced in accordance with the laws of the State of Delaware
without regard to the principles of conflicts of laws.
36. Survival. The provisions of Sections 25, 26, 28, 29, 30, 31, 32,
--------
33, 35, 36, 38, 39 and 40 of this Amendment No. 1 shall survive expiration or
termination for any reason of the Joint Venture Agreement.
37. Execution in Counterparts. This Amendment No. 1 may be executed
-------------------------
and delivered in any number of counterparts, each of which shall be deemed to be
an original, but all of which taken together shall constitute one and the same
instrument.
38. MST Patents. IGEN hereby acknowledges and agrees that, as between
-----------
IGEN on the one hand and MST on the other hand, the patent applications and
registrations listed on Exhibit II attached hereto are the proprietary
information and property of MST, which have been licensed to MSD pursuant to the
MST/MSD License Agreement; provided, however, that such patent list is not
intended to be a complete or comprehensive listing of the proprietary
information and property of MST or MSD.
39. Acknowledgement of Assignment. Each of MSD, MST and IGEN hereby
-----------------------------
acknowledge and agree that assignments (whether past, present or future) of
Developments by IGEN and/or employees, consultants, contractors, or other
personnel of IGEN, including without limitation, the IGEN Research Personnel,
directly to MST satisfies the requirements of Section 3.6 of the Joint Venture
Agreement.
40. Third Party Agreements. IGEN, MSD and MST hereby acknowledge and
----------------------
agree that IGEN is, and may be from time to time, a party to various agreements
with third party licensors, suppliers, vendors, distributors and other providers
relating to a license, invention, method, know-how, procedure or other
technology or other goods or services (each, a "Third Party Agreement") that
---------------------
provide or permit the provision of a benefit or right to MSD or enable MSD to be
entitled to a benefit or right (that MSD may not currently realize or obtain but
that MSD may wish to realize or obtain in the future), in each case on a basis
no less favorable to MSD than is obtained by IGEN. IGEN hereby agrees that (a)
for so long as IGEN is, or continues to be, a party to any such Third Party
Agreement, to provide or to continue to provide or to make available, as the
case may be, the benefits and rights of such Third Party Agreement to MSD and,
(b) in the event
-39-
that IGEN determines that it is no longer in its best interest to be a party to
or to retain and preserve the full benefits and rights for itself and for MSD or
to be subject to the obligations of any such Third Party Agreement, (i) to
provide written notice to MSD of such determination and (ii) in the event MSD so
requests in writing to IGEN (A) IGEN will use its reasonable best efforts to
assign such Third Party Agreement to MSD (or its designee) (including, in the
event IGEN is prohibited by the terms of such Third Party Agreement from
assigning such Third Party Agreement, to use its reasonable best efforts to
obtain the necessary consent to such assignment) and, (B) in the event IGEN is
prevented by the terms of such Third Party Agreement or otherwise from assigning
such Third Party Agreement, IGEN agrees to permit and to use its reasonable best
efforts to enable MSD to fulfill or to assume (without a formal assignment or
assumption agreement) IGEN's obligations as a party under and to receive the
full benefits and rights of such Third Party Agreement on the basis no less
favorable to MSD than is obtained by IGEN, at MSD's sole cost and expense,
provided, however, that MSD agrees in a separate writing to indemnify and defend
IGEN against, and hold IGEN harmless from, any and all claims or liabilities
directly arising under or related to actions taken by MSD in connection with
this clause (B).
41. Research Outline. Exhibit A of the Joint Venture Agreement is
----------------
hereby deleted in its entirety and replaced with the following:
"The research will be conducted under the direction and
guidance of Xxxxxxxxxxx. The Research Program shall initially
be directed at the use in diagnostic procedures, including
diagnostic procedures utilizing electrochemiluminescent
("ECL") technology of (i) * methods, including, without
limitation, the * described in the United States Patent
application entitled * serial no. * (including all divisions,
continuations and continuations-in-part thereto), and *, all
relating to only the * of the * and *, (ii) *, including,
without limitation, * and * the * and/or * (e.g., through
* ), and * and * (e.g., through * and *), including, without
limitation, for use in * and * (including, without
limitation, the * described in the United States Patent
application entitled * serial no. * (including all divisions,
continuations and continuations-in-part thereto), and * ),
and/or (iii) * (e.g. * ), including, without limitation, for
use in * methods (including, without limitation, the *
described in the United States Patent application entitled *
serial no. * (including all divisions, continuations and
continuations-in-part thereto), and * ). The foregoing
specifically includes, but it not limited to, * (e.g., * ), *
and/or * and * and/or *, as well as the use of * and/or *
(e.g., *)."
[Remainder of Page Intentionally Left Blank]
-40-
IN WITNESS WHEREOF, the parties have caused this Amendment No.
1 to be duly executed and delivered on their behalf, as of the date first
written above.
MESO SCALE DIAGNOSTICS, LLC.
By: /s/ Xxxxx X. Xxxxxxxxxxx
-------------------------------------
Name: Xxxxx X. Xxxxxxxxxxx
Title: President and Chief Executive Officer
IGEN INTERNATIONAL, INC.
By: /s/ Xxxxxx Xxxxxxxx
-------------------------------------
Name: Xxxxxx Xxxxxxxx
Title: Vice President and Chief Financial
Officer
MESO SCALE TECHNOLOGIES, LLC.
By: /s/ Xxxxx X. Xxxxxxxxxxx
-------------------------------------
Name: Xxxxx X. Xxxxxxxxxxx
Title: President and Chief Executive Officer
-41-
EXHIBIT II
Patent Applications and Registrations of Meso Scale Technologies, LLC.
*
[4 pages redacted]
