EXECUTION COPY
PRODUCT ACQUISITION AGREEMENT
SOLAGE(R) (MEQUINOL 2% AND TRETINOIN 0.01%)
BY AND BETWEEN
XXXXXXXX ENTERPRISES LIMITED
AND
BARRIER THERAPEUTICS, INC.
DATED FEBRUARY 5, 2005
TABLE OF CONTENTS
PAGE
ARTICLE 1 DEFINITIONS............................................... 1
ARTICLE 2 SALE OF ASSETS, LICENSES AND CLOSING...................... 9
2.1 Sale of Assets................................................ 9
2.2 Licenses...................................................... 10
2.3 Assumed Liabilities........................................... 11
2.4 Purchase Price................................................ 11
2.5 Inventory Transfer............................................ 11
2.6 Contingent Purchase Price..................................... 12
2.7 Earn-Out Payments............................................. 12
2.8 Closing....................................................... 12
ARTICLE 3 REGULATORY MATTERS........................................ 13
3.1 Transfer of Title to the Product Registrations................ 13
ARTICLE 4 REPRESENTATIONS AND WARRANTIES............................ 13
4.1 Representations and Warranties of Seller...................... 13
4.2 Representations and Warranties of Purchaser................... 18
4.3 Survival of Representations/Warranties........................ 19
4.4 Brokers....................................................... 19
ARTICLE 5 COVENANTS................................................. 19
5.1 Post-Closing Orders and Payments.............................. 19
5.2 Chargebacks................................................... 20
5.3 Medicare, Medicaid and State Rebates.......................... 20
5.4 Returns Due to Product Expiration and Other Returns........... 20
5.5 Net Sales and Earn-Out Obligations............................ 20
5.6 Audit......................................................... 21
5.7 Right of First Refusal........................................ 21
5.8 Restrictions on Sale of Products.............................. 21
5.9 No Obligation to Supply....................................... 22
5.10 Set-Off....................................................... 22
5.11 Patent Prosecution and Maintenance............................ 22
ARTICLE 6 INDEMNIFICATION........................................... 22
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TABLE OF CONTENTS
(continued)
PAGE
6.1 Indemnification by Seller..................................... 22
6.2 Indemnification by Purchaser.................................. 23
6.3 Limitation of Liability....................................... 23
6.4 Procedures for Indemnification for Third Party Claims......... 23
6.5 Losses That Are Not Third Party Claims........................ 25
6.6 Termination of Indemnification Obligations.................... 25
ARTICLE 7 GENERAL PROVISIONS........................................ 25
7.1 Payment of Transaction Expenses............................... 25
7.2 Taxes......................................................... 25
7.3 Notices....................................................... 26
7.4 Entire Agreement.............................................. 27
7.5 Confidentiality; Public Disclosures........................... 27
7.6 Modifications and Amendments.................................. 28
7.7 Assignment.................................................... 28
7.8 Headings, Interpretation...................................... 28
7.9 Independent Parties........................................... 28
7.10 Governing Law................................................. 28
7.11 Jurisdiction; Waiver of Jury Trial............................ 28
7.12 Waiver........................................................ 28
7.13 Severability.................................................. 29
7.14 Counterparts; Facsimile Signatures............................ 29
7.15 No Third Party Beneficiaries.................................. 29
7.16 Further Assurances............................................ 29
7.17 Certain Conventions........................................... 29
7.18 No Strict Construction........................................ 29
7.19 Bulk Sales Laws............................................... 29
7.20 Currency...................................................... 29
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Schedules
PRODUCT ACQUISITION AGREEMENT
THIS PRODUCT ACQUISITION AGREEMENT (this "Agreement") is entered into as
of February 5, 2005, by and between Xxxxxxxx Enterprises Limited, a company
constituted and existing under the laws of British Virgin Islands, as holding
company of G.P. Pharm S.A., a company constituted and operating under the law of
Spain ("Seller"), and Barrier Therapeutics, Inc., a corporation organized and
existing under the laws of the State of Delaware ("Purchaser").
RECITALS
WHEREAS, Seller owns the pharmaceutical product known as Solage(R)
(Mequinol 2% and Tretinoin 0.01%);
WHEREAS, Seller is engaged in the business of marketing, selling,
developing and distributing the Product (as defined below) in the Territory (as
defined below); and
WHEREAS, Seller desires to sell, transfer, convey and license to
Purchaser, and Purchaser desires to purchase, acquire, assume and license from
Seller and its Affiliates, certain rights in the Territory in and to the
Product, including the acquisition or license of certain assets and the
assumption of certain liabilities, relating to such Product, all on the terms
and subject to the conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
set forth in this Agreement, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:
ARTICLE 1
DEFINITIONS
In addition to the terms defined above and elsewhere in this Agreement,
when used in this Agreement, the following capitalized terms have the meanings
set forth in this Article 1.
1.1 "Act" means, as applicable, the United States Federal Food, Drug and
Cosmetic Act and the Food and Drugs Act (Canada), each as in effect on the date
hereof and as amended from time to time hereafter, and any successor or
superseding act or statute thereof.
1.2 "Affiliate" means a Person that, directly or indirectly, through one
or more intermediates, controls, is controlled by, or is under common control
with, the Person specified. For the purposes of this definition, control shall
mean the direct or indirect ownership of (a) in the case of corporate entities,
securities authorized to cast more than fifty percent (50%) of the votes in any
election for directors, (b) in the case of non-corporate entities, more than
fifty percent (50%) ownership interest with the power to direct the management
and policies of such non-corporate entity, or (c) in the case of a non-United
States Person, such lesser percentage thereof as may be the maximum percentage
allowed to be owned by a Person who is foreign for purposes of the jurisdiction
of incorporation or formation of such non-United States Person under the
applicable Laws of the jurisdiction of such non-United States Person of the
equity having the power to vote in the election of directors or to direct the
management and policies of
such non-United States Person. Notwithstanding anything to the contrary herein,
G.P. Pharm S.A., a spanish entity, shall be deemed an Affiliate of Seller for
all purposes under this Agreement.
1.3 "Agreement" means this Agreement and all exhibits and schedules
attached hereto.
1.4 "API" means the active pharmaceutical ingredients Mequinol
(4-hydroxyanisole, the monomethyl ether of hydroquinone or 1 hydroxy-4-methoxy
benzene) and Tretinoin ((all-E)-3,7-dimethyl-9- (2,6,6-trimethyl-1
-cyclohexen-1-yl) -2,4,6,8- nonatetraenoic acid).
1.5 "Assigned Patents" means those United States and Canadian Patents
owned by, or in the possession of or otherwise available to, Seller or its
Affiliates and used or held for use in connection with the Products in the
Territory (including each such Patent in connection with the Product in the
Territory assigned or otherwise transferred to Seller pursuant to the Galderma
Purchase Agreement), each of which is listed on Schedule 1.5 attached hereto,
and any and all patent applications, additions, reissues, renewals,
registrations, divisions, continuations, continuations-in-part, continued
prosecution applications, substitutions, extensions and reexaminations thereof.
1.6 "Books and Records" means copies of all books and records owned by, or
in the possession of or otherwise available to, Seller or its Affiliates related
to the Products in the Territory or the Purchased Assets, including all such
books and records assigned or otherwise transferred to Seller pursuant to the
Galderma Purchase Agreement.
1.7 "Business Day" means any day except a Saturday, Sunday or a day on
which a commercial bank in New York, New York is authorized to close.
1.8 "Canadian Solage (R) Product" means the pharmaceutical product
containing the API in a solution base of ethyl alcohol (77.8% v/v), polyethylene
glycol 400, butylated hydroxytoluene, ascorbic acid, citric acid, ascorbyl
palmitate, edetate disodium and purified water having a DIN# 02243257.
1.9 "Control" or "Controlled" means, with respect to any Intellectual
Property or other intangible property, the possession (whether by license or
ownership, or by control over an Affiliate having possession by license or
ownership) by a Party of the ability to grant to the other Party access and/or a
license or sublicense as provided herein.
1.10 "Distribution Agreement" means that certain agreement to be entered
into on the Closing Date by and between Purchaser and Galderma.
1.11 "Earn-Out Term" shall mean the period commencing on January 1, 2006
and ending on the earlier of (i) December 31, 2010 and (ii) the date the sum of
any Contingent Purchase Price paid by Purchaser hereunder plus all Earn-Out
Payments paid (or accrued) by Purchaser hereunder equals Two Million Dollars
($2,000,000).
1.12 "FDA" means the United States Food and Drug Administration, and any
successor agency thereto.
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1.13 "FDA or Foreign Equivalent" means, as applicable, the FDA and Health
Canada, and any successor agency thereto.
1.14 "Finished Goods" means Product manufactured and packaged in
accordance with all applicable Laws, Product Registrations and Product
Specifications and ready for sale in the Territory to the ultimate customer.
1.15 "Galderma" means Galderma S.A., an entity organized under the laws of
Switzerland.
1.16 "Galderma Purchase Agreement' means that certain Asset Purchase
Agreement dated as of December 14, 2004 by and between Galderma and Seller.
1.17 "Governmental Authority" means any federal, regional, state,
provincial, local or other government, any national, regional, state,
provincial, local or other court of competent jurisdiction, legislature,
governmental, administrative or regulatory agency, department, body, bureau,
council or commission or any other national, regional, state, provincial, local
or other governmental authority or instrumentality, including the FDA or Foreign
Equivalent.
1.18 "IND or Foreign Equivalent" means (a) a United States Investigational
New Drug Application (as defined in the Act and the regulations promulgated
thereunder) that is required to be filed with the FDA under the Act and the
regulations promulgated thereunder before initiating clinical trials of a
pharmaceutical drug or product in the United States, (b) any Canadian
equivalent/counterpart of a United States Investigational New Drug Application,
including an Investigational New Drug Submission made pursuant to Division 8 of
the Act and the regulations promulgated thereunder and (c) any successor
applications thereof and any supplements, amendments or additions thereto.
1.19 "Intellectual Property" means all (a) Patents; (b) mask works and
copyrights in works of authorship of any type, including computer software and
industrial designs, registrations and applications for registration thereof; (c)
trademarks (both registered and common law) and trademark registrations,
applications and renewals and domain names and all goodwill associated
therewith; (d) trade secrets, know-how, ideas, concepts, formulas, methods,
procedures, designs, compositions, plans, documents, data, inventions,
discoveries, works of authorship, compounds and biological materials and other
confidential or proprietary technical, business and other information, and all
rights in any jurisdiction to limit the use or disclosure thereof; and (e)
rights to xxx and recover damages or obtain injunctive relief for past and
future infringement, dilution, misappropriation, violation or breach thereof.
1.20 "Inventory" or "Inventories" mean all inventories of Finished Goods
of Seller and its Affiliates as of the Closing Date, whether then in the
possession of Seller or Galderma or an Affiliate thereof or in the possession
of, or in transit to, any distribution center of Seller, Galderma or an
Affiliate thereof as of such date (including any such inventory of Finished
Goods made available to Seller pursuant to the Galderma Purchase Agreement).
1.21 "Law" means any applicable declaration, decree, directive,
legislative enactment, order, ordinance, regulation, rule, guidance or other
binding restriction of or by any Governmental Authority, as amended from time to
time.
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1.22 "Liabilities" means any and all debts, liabilities and obligations,
whether accrued or fixed, absolute or contingent, matured or unmatured, or
determined or determinable, including those arising under any Laws, action or
governmental order and those arising under any contract, agreement, arrangement,
commitment or undertaking, or otherwise.
1.23 "Licensed Intellectual Property" means, collectively, the Seller
Intellectual Property and the Manufacturing Technology.
1.24 "Liens" means any liens, hypothecations, mortgages, charges, security
interests, pledges, defects of title and other similar encumbrances, in each
case whether absolute, contingent, accrued or otherwise.
1.25 "Losses" means any and all Liabilities, damages, fines, penalties,
deficiencies, losses and expenses (including interest, court costs, amounts paid
in settlement, reasonable fees of attorneys, accountants and other experts or
other reasonable expenses of litigation or other proceedings or of any claim,
default or assessment); provided, however, that the term "Losses" shall not
include any special, consequential, indirect, punitive, provisional or similar
damages, except to the extent actually paid by a Party pursuant to any Third
Party Claim.
1.26 "Manufacturing Technology" means the technology, processes,
techniques, specifications, inventions, assays, quality control and testing
procedures, trade secrets, know-how and other proprietary information (including
all such technology, processes, techniques, specifications, inventions, assays,
quality control and testing procedures, trade secrets, know-how and other
proprietary information assigned, licensed or otherwise transferred to Seller
pursuant to the Galderma Purchase Agreement) for or in connection with the
manufacture, formulation, packaging, release testing, validation, stability and
shelf life of the Products, including the Products' formulation, in each case
which is Controlled by Seller or its Affiliates; provided, however, that
Manufacturing Technology shall not include any plant, real property, equipment
or employees and shall not include any Purchased Intellectual Property.
1.27 "Net Sales" means the aggregate gross amounts, calculated in United
States Dollars, invoiced by or on behalf of Purchaser or its Affiliates or
sublicensees on account of sales of the Products (for which Purchaser has
obtained rights hereunder) to Third Parties in the Territory (including Third
Party distributors and wholesalers), less the following relating to such sales:
(a) trade, quantity and/or early pay cash actually allowed and taken
that are not already reflected in the amount invoiced;
(b) excise, sales, and other consumption taxes (including VAT on the
sale of such Products) and custom duties to the extent included in the invoice
price;
(c) amounts repaid or credited by reason of defects, recalls,
returns and rebates (including rebates to Governmental Authorities);
(d) compulsory payments and rebates related to the sale of such
Products, accrued, paid, or deducted, pursuant to agreements (including managed
care agreements) or governmental regulations;
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(e) amounts repaid or credited by reason of chargebacks, retroactive
price reductions, refunds or billing errors or administrative fees paid to group
purchasing organizations; and
(f) amounts paid on warranty claims related to a Product.
Use of Products for promotional or sampling purposes and for use in
pre-clinical or clinical trials shall not be considered in determining Net Sales
of such Products. In the case of any sale of a Product between or among
Purchaser and its Affiliates or sublicensees for resale, Net Sales shall be
calculated as above only on the first arm's length sale thereafter to a Third
Party.
1.28 "NDA" means a United States New Drug Application (as defined in the
Act and the regulations promulgated thereunder) pursuant to Section 505 of the
Act (21 U.S.C. Section 355) and the regulations promulgated thereunder submitted
to the FDA for approval to market a pharmaceutical drug or product in the United
States, including, where applicable, applications for pricing and reimbursement
approval and any successor applications thereof and any supplements, amendments
or additions thereto.
1.29 "NDA or Foreign Equivalent" means (a) an NDA, (b) any Canadian
equivalent/counterpart of NDA, including a New Drug Submission (an "NDS") made
pursuant to Division 8 of the Act and (c) any successor applications thereof and
any supplements, amendments or additions thereto.
1.30 "Party" means Seller, on the one hand, and Purchaser, on the other
hand, as the case may be, and "Parties" shall mean Seller and Purchaser
collectively.
1.31 "Patents" means all patents, patent applications, additions,
reissues, renewals, registrations, divisions, continuations,
continuations-in-part, continued prosecution applications, substitutions,
extensions and reexaminations thereof.
1.32 "Person" means any individual, firm, corporation, partnership,
limited liability company, trust, unincorporated organization or other entity or
a government agency or political subdivision thereto, and shall include any
successor (by merger or otherwise) of such Person.
1.33 "Phase III-B Clinical Trials" means product support clinical trials
of a Product (i.e., a clinical trial which is not required for receipt of
initial Regulatory Approval but which may be useful in providing additional drug
profile data or in seeking a label expansion) commenced before receipt of
Regulatory Approval for the indication for which such trial is being conducted.
1.34 "Phase IV Clinical Trials" means product support clinical trials of a
Product commenced after receipt of Regulatory Approval in the indication for
which such trial is being conducted.
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1.35 "Product Clinical Data" means all technical, scientific, chemical,
biological, pharmacological and toxicological data (including all such data in
support of the Product Registrations such as Phase III-B Clinical Trial data and
Phase IV Clinical Trial data) generated in connection with the Product and any
other data derived from past clinical studies related to the Product in the
Territory, in each case which is owned by, or in the possession of or otherwise
available to, Seller or its Affiliates (including all such data assigned or
otherwise transferred to Seller pursuant to the Galderma Purchase Agreement).
1.36 "Product Domain Names" means the domain names and applications
therefore in connection with the Product in the Territory and which are listed
on Schedule 1.36 (including those domain names assigned or otherwise transferred
to Seller pursuant to the Galderma Purchase Agreement).
1.37 "Product Marketing Materials" means all marketing, advertising and
promotional materials of Seller or its Affiliates (including those marketing,
advertising and promotional materials assigned or otherwise transferred to
Seller pursuant to the Galderma Purchase Agreement) that are used, or held for
use, solely in connection with the Products in the Territory and that are in
existence as of the Closing Date, including, all advertising and display
materials, product data, price lists, sales materials, marketing information,
marketing plans, sales, training and education materials, promotional materials,
scientific and commercial publications, market research, artwork for the
production of packaging components, television masters and other materials.
1.38 "Product Material Adverse Effect" means any adverse event, change,
circumstance or effect that is, either individually or in the aggregate with all
other adverse events, changes, circumstances and effects, materially adverse to
the Purchased Assets or the Licenses, other than any event, change, circumstance
or effect relating (a) to the economy of the United States or Canada in general,
(b) in general to the industries in which the Products are sold and not
specifically relating to the Products or (c) changes, circumstances and effects
relating to the announcement of the transactions contemplated by this Agreement.
1.39 "Product Registrations" means those Regulatory Approvals relating to
the Products in the Territory owned by Seller or its Affiliates (including such
Regulatory Approvals assigned or otherwise transferred to Seller pursuant to the
Galderma Purchase Agreement), each of which is listed on Schedule 1.39.
1.40 "Product Regulatory Documentation" means paper or electronic copies
(provided, however, that paper copies or originals shall be provided to the
extent required by applicable Law) of all regulatory documentation and files
pertaining to the Products in the Territory, including all data in support of
the Product Registrations, all drug safety reports with respect to the Product
in the Territory, all correspondence with Governmental Authorities related to
the Product in the Territory and all similar regulatory information assigned or
otherwise transferred to Seller pursuant to the Galderma Purchase Agreement, in
each case which is owned by, or otherwise in the possession or control of,
Seller or its Affiliates, each of which is set forth on Schedule 1.40 attached
hereto.
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1.41 "Product Specifications" means all applicable manufacturing
specifications required in the manufacture of the Products for sale in the
Territory in compliance with all applicable Regulatory Approvals.
1.42 "Product Trademarks" means, collectively, (i) all United States and
Canadian trademarks, trade names, logos and common law trademarks owned by, or
otherwise in the possession or control of, Seller or its Affiliates (including
such trademarks, trade names, logos and common law trademarks assigned or
otherwise transferred to Seller pursuant to the Galderma Purchase Agreement)
related to the Product, each of which is listed on Schedule 1.42 and all common
law rights, registrations, applications and renewals for any of the foregoing
and (ii) all Product Domain Names, in each case of (i) and (ii), together with
the goodwill associated therewith.
1.43 "Products" means and collectively refers to all dosage forms,
strengths, presentations and package sizes of any pharmaceutical product,
whether branded or generic, containing the API for any indication, including the
Canadian Solage (R) Product and the United States Solage (R) Product; and
"Product" shall mean any of the foregoing individually as the context may
require.
1.44 "Purchase Price" means collectively, the Initial Purchase Price, the
Contingent Purchase Price and the Earn-Out Payments.
1.45 "Purchased Intellectual Property" means collectively (a) the Assigned
Patents, (b) the Product Trademarks, (c) the Product Clinical Data, and (d)
solely and exclusively for the Territory, any and all other Intellectual
Property related to the Purchased Assets.
1.46 "Regulatory Approval" means the technical, medical, scientific and
other applicable licenses, registrations, authorizations, approvals and other
requirements (including approvals of INDs or Foreign Equivalents or NDAs or
Foreign Equivalents, supplements and amendments, pre- and post- approvals,
pricing and Third Party reimbursement approvals, and labeling approvals) of any
Governmental Authority necessary for the development (including the conduct of
clinical trials), manufacture, distribution, marketing, promotion, offer for
sale, use, import, export or sale of the Products solely and exclusively for the
Territory.
1.47 "Seller Intellectual Property" shall mean any Intellectual Property
Controlled by Seller and/or its Affiliates, in each case related to the Product;
provided, however, that the Seller Intellectual Property shall exclude the
Purchased Intellectual Property and the Manufacturing Technology.
1.48 "Supply Agreement" shall mean that certain Toll Manufacturing
Agreement dated as of December 30, 2001 between Bristol Xxxxx Squibb and
Galderma S.A., as amended, which Supply Agreement has been assigned to Seller
and pursuant to which the Products are manufactured for Seller and its
Affiliates for sale or use the Territory.
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1.49 "Taxes" (and with correlative meaning, "Tax," "Taxes," and "Taxable")
shall mean all taxes of any kind imposed by a federal, state, provincial, local
or foreign Governmental Authority, including those on, or measured by or
referred to as, income, gross receipts, financial operation, sales, use, ad
valorem, value added, franchise, profits, license, excise, stamp, premium,
property, transfer (including transfer of goodwill) or windfall profits taxes,
customs, duties or similar fees, assessments or charges of any kind whatsoever,
together with any interest and any penalties, additions to tax or additional
amounts imposed by such Governmental Authority with respect to such amounts.
1.50 "Territory" means the United States and Canada and each of their
respective territories, possessions and protectorates.
1.51 "Third Party" means any Person who is not a Party to this Agreement
(or an Affiliate thereof).
1.52 "Transaction Documents" means this Agreement, the General Assignment
and Assumption, each Assignment of Patents, the Assignment of Domain Names, the
Assignment of Trademarks, the Supply Agreement Assignment and Assumption of
Contract and all other instruments, agreements, certificates or other documents
executed or delivered in connection with the consummation of the transactions
contemplated by this Agreement.
1.53 "United States Solage (R) Product" means the pharmaceutical product
containing the API in a solution base of ethyl alcohol (77.8% v/v), polyethylene
glycol 400, butylated hydroxytoluene, ascorbic acid, citric acid, ascorbyl
palmitate, edetate disodium and purified water having a NDA# 20-922.
1.54 Additional Definitions. Each of the following definitions is set
forth in the Section of this Agreement indicated below:
Definition Section
---------- -------
Agreement Preamble
Assignment of Trademarks 2.8(c)(ii)
Assignment of Patents 2.8(c)(iii)
Assumed Liabilities 2.3(a)
Closing 2.8(a)
Closing Date 2.8(a)
Competitor Product 5.8
Confidential Information 7.5(a)
Contingent Purchase Price 2.6
Earn-Out Payment 2.7
Earn-Out Report 5.5(a)
Final Terms 5.7
Financial Information 4.1(d)
General Assignment and Assumption 2.8(c)(i)
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Indemnitee 6.4(a)
Indemnitor 6.4(a)
Initial Purchase Price 2.4
Licenses 2.2(a)
NDS 1.29
Non-Compete Period 5.8
Proceeding 4.1(f)
Product Registration Transfer Date 3.1
Proposed Transaction 5.7
Purchased Assets 2.1(a)
Purchaser Preamble
Purchaser Disclosure Schedule 4.2
Retained Liabilities 2.3(b)
Returns 5.4
SEC 7.5(b)(i)
Seller Preamble
Seller Disclosure Schedule 4.1
Supply Agreement Assignment and Assumption of Contract 2.8(c)(iv)
Third Party Claim 6.4(a)
ARTICLE 2
SALE OF ASSETS, LICENSES AND CLOSING
2.1 Sale of Assets.
(a) On the Closing Date, and subject to the terms and conditions of
this Agreement, Seller will, and will cause its Affiliates or Galderma to, sell,
assign, convey, transfer and deliver to Purchaser, and Purchaser will purchase
and accept from Seller and its Affiliates or Galderma all right, title and
interest of Seller and its Affiliates in, to and under all of Seller's (and its
Affiliates') assets related to the Product in the Territory (collectively, the
"Purchased Assets"), including the following assets, in each case free and clear
of any and all Liens whatsoever:
(i) the Purchased Intellectual Property and all benefits,
claims and rights accruing to Seller and its Affiliates relating thereto,
together with (x) true and complete copies of all files relating to the filing,
prosecution, issuance, maintenance, correspondence, enforcement and defense of
the Product Trademarks and Assigned Patents and (y) hard or electronic copies of
all Product Clinical Data and all rights in and to the Product Clinical Data;
(ii) the Product Registrations;
(iii) hard or electronic copies of the Product Regulatory
Documentation and all rights in and to the Product Regulatory Documentation;
(iv) all rights in, to and under the Supply Agreement;
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(v) all Product Marketing Materials and all rights in and to
the Product Marketing Materials;
(vi) all Inventories;
(vii) all rights in, to and under the unfulfilled portions of
customer orders relating to the purchase and sale of Finished Goods in the
Territory as of the Closing Date, together with all prepayments or deposits paid
by such customers to Seller or its Affiliates with respect to the unfulfilled
portions of such customer orders;
(viii) a list of all current customers and suppliers for the
Products in the United States and Canada;
(ix) the Books and Records;
(x) all copyrights in and to the Product Marketing Materials;
and
(xi) all goodwill relating to the foregoing.
(b) Notwithstanding Section 2.1(a) above, (i) the transfer of the
Product Registrations shall occur in accordance with the provisions of Article 3
and the transfer of the Inventory shall occur in accordance with the provisions
of Section 2.5 and (ii) the delivery of the Purchased Assets described in
clauses (a)(iii), (v) and (ix) of Section 2.1(a) shall occur as promptly as
reasonably practicable following the Closing, but in any event no later than one
(1) month after the Closing Date.
(c) The Parties agree and acknowledge that the Purchased Assets
shall not include the Licensed Intellectual Property or any plant, real
property, equipment, accounts receivable for the sale of the Products made prior
to the Closing Date, cash, employees or any refund or credit of Taxes
attributable to any period of time prior to the Closing Date.
2.2 Licenses.
(a) Effective as of the Closing Date, subject to the terms and
conditions of this Agreement, Seller hereby grants, and agrees to cause its
Affiliates to grant, to Purchaser the following licenses (the "Licenses"):
(i) an exclusive (even as to Seller and its Affiliates),
irrevocable, perpetual, fully-paid, royalty-free, sublicensable, transferable,
right and license under the Manufacturing Technology to (1) manufacture the
Products within or outside the Territory for use, distribution, marketing, sale,
offer for sale, development, importation, commercialization and promotion in the
Territory and (2) use, distribute, market, sell, offer for sale, develop,
import, commercialize and promote the Products in the Territory; and
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(ii) an exclusive (even as to Seller and its Affiliates),
irrevocable, perpetual, fully-paid, royalty free, sublicensable, transferable
right and license to reference, file with the FDA or Foreign Equivalent and
otherwise use the Seller Intellectual Property, if any, solely for the purposes
of (1) obtaining Regulatory Approval for the Products for sale in the Territory,
(2) maintaining Regulatory Approvals for the Products for sale in the Territory,
(3) making product labeling changes for Products for sale in the Territory and
(4) conducting such studies and clinical trials within or outside the Territory
as may be necessary or useful for Purchaser and its Affiliates to obtain and
maintain Regulatory Approvals for the Product in the Territory or otherwise
research and develop, within and outside the Territory, the Products for sale in
the Territory.
(b) Without the prior written consent of Purchaser, Seller (and its
Affiliates) shall not conduct any new studies or clinical trials in the
Territory relating to the Products (or any other pharmaceutical product, whether
branded or generic, containing the API as an active pharmaceutical ingredient).
Upon obtaining such consent, Seller (and its Affiliates) shall have a
royalty-free license in the Purchased Assets necessary to conduct any such
clinical trials.
(c) Seller hereby agrees that any future licenses, sublicenses,
sales or other similar disposition of the Licensed Intellectual Property
permitted pursuant to this Agreement and granted by Seller or its Affiliates to
a Third Party will be expressly subject to the licenses granted to Purchaser
hereunder.
2.3 Assumed Liabilities.
(a) As of the Closing Date, Purchaser shall assume, be responsible
for and pay, perform and discharge when due the following, which would, but for
this Agreement, be the responsibility of Seller (or its Affiliates)
(collectively, the "Assumed Liabilities"):
(i) any Liability arising from the sale of the Products in the
Territory by or on behalf of Purchaser arising out of acts, omissions or events
first occurring on or after the Closing Date, except to the extend such
Liability arises from acts or omissions taken by, or failed to be taken by,
Seller or its Affiliates or Galderma (including under the Distribution
Agreement). Notwithstanding the foregoing, Purchaser shall not assume (or be
deemed to have assumed), and Seller shall be responsible for, any such
Liabilities arising out of or relating to Products sold prior to the Closing;
and
(ii) any Liability first arising on or after the Closing Date
under the Supply Agreement, except as otherwise limited by the General
Assignment and Assumption; provided, however, that Purchaser shall not assume or
be deemed to have assumed any Liabilities relating to pre-Closing obligations
under, or pre-Closing breaches or defaults of, any Assigned Contract.
(b) Except for the Assumed Liabilities, Purchaser will not assume,
nor will it become responsible for, nor will it be deemed to have assumed or
become responsible for, any Liability or obligation of Seller or its Affiliates
(each, a "Retained Liability" and collectively, the "Retained Liabilities").
Retained liabilities includes Returns pursuant to Section 5.4.
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2.4 Purchase Price. Subject to the terms and conditions set forth herein,
in consideration for the sale, transfer, assignment, conveyance, license and
delivery of the Purchased Assets and the Licenses, at Closing Purchaser will pay
to Seller, by wire transfer of immediately available funds to a bank account
designated by Seller, a cash payment of Three Million ($3,000,000) (the "Initial
Purchase Price")
2.5 Inventory Transfer. In addition to the Purchase Price under Section
2.4 above, Buyer shall pay Seller or one of its designated affiliates for the
Inventory. The Inventory will be transferred to Purchaser or its designees in
accordance with the terms of the Distribution Agreement. The actual value of the
Inventory will be settled within 10 days of Closing Date at a cost of USD 6.50
per unit of United States Solage(R) Product and USD 6.75 per unit of Canadian
Solage(R) Product.
2.6 Contingent Purchase Price. In addition to the Initial Purchase Price,
Purchaser shall pay Seller a one-time cash payment in an amount equal to the
Contingent Purchase Price by wire transfer of immediately available funds, which
payment shall be made by Purchaser on or prior to March 1, 2006. As used herein,
the term "Contingent Purchase Price" shall mean (i) One Million Dollars
($1,000,000) in the event that the Net Sales of the Product for the 2005
calendar year exceeds Two Million Dollars ($2,000,000), (ii) Five Hundred
Thousand Dollars ($500,000) in the event that the Net Sales of the Product for
the 2005 calendar year are greater than One Million Dollars ($1,000,000) but
less than or equal to Two Million Dollars ($2,000,000) and (iii) One Hundred
Thousand Dollars ($100,000) in the even that Net Sales of the Product for the
2005 calendar year are less than or equal to One Million Dollars ($1,000,000).
2.7 Earn-Out Payments. In addition to the Initial Purchase Price and the
Contingent Purchase Price, during the Earn-Out Term, Purchaser shall pay a
Seller semi-annual cash payment equal to five percent (5%) of aggregate Net
Sales of Products in the Territory (each, a "Earn-Out Payment"). Each Earn-Out
Payment shall be made by Purchaser by wire transfer of immediately available
funds in accordance with the provisions of Section 5.5(a). Notwithstanding
anything to the contrary contained herein, Purchaser shall only be obligated to
make payments in respect of the Contingent Purchase Price and all Earn-Out
Payments in an aggregate amount of up to Two Million Dollars ($2,000,000) (i.e.,
the obligations of Purchaser hereunder to pay the Contingent Purchase Price and
any Earn-Out Payment shall cease after Purchaser has paid Seller an aggregate of
$2,000,000 in respect of the Contingent Purchase Price and all Earn-Out
Payments).
2.8 Closing.
(a) The closing of the transactions contemplated hereby (the
"Closing") will take place at the offices of Xxxxxx, Xxxxx & Xxxxxxx LLP in
Princeton, New Jersey at 10:00 A.M. Eastern Time on the date hereof. The actual
date of the Closing is referred to as the "Closing Date." The Closing, and the
transfer of the Purchased Assets and the assumption of the Assumed Liabilities,
shall be deemed to be effective at 12:01 A.M. on the Closing Date.
(b) At the Closing, Purchaser will pay the Initial Purchase Price in
full in cash without any deductions or offsets by wire transfers of immediately
available funds to a bank account or accounts to be designated by Seller prior
to Closing.
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(c) At the Closing, Seller will sell, assign, convey and transfer
(and cause its Affiliates or Galderma to sell, assign, convey and transfer) to
Purchaser (or, if applicable, one or more Affiliates of Purchaser designated
thereby) all of Seller's and its Affiliates' right, title and interest in, to
and under the Purchased Assets, by executing and delivering to Purchaser, each
in a form acceptable to Purchaser:
(i) a general assignment, assumption and xxxx of sale (the
"General Assignment and Assumption");
(ii) an assignment of Product Trademarks (an "Assignment of
Trademarks");
(iii) an assignment of the Assigned Patents (an "Assignment of
Patents");
(iv) an assignment of the Supply Agreement (the "Supply
Agreement Assignment and Assumption of Contract"); and
(v) an assignment of the Product Domain Names (the "Assignment
of Domain Names").
(d) Purchaser will assume from Seller the due payment, performance
and discharge of the Assumed Liabilities by executing and delivering to Seller
the General Assignment and Assumption.
ARTICLE 3
REGULATORY MATTERS
3.1 Transfer of Title to the Product Registrations. Seller and Purchaser
acknowledge that on the Closing Date legal title to the Product Registrations
will remain with Seller or its Affiliates or designees, as the case may be, on a
country-by-country basis in the Territory and shall be transferred on a
country-by-country basis pursuant to the terms of this Agreement and the
Distribution Agreement (the effective date of each such transfer being a
"Product Registration Transfer Date"). Notwithstanding the foregoing, to the
extent permitted by the applicable Laws of a country in the Territory,
beneficial ownership of the Product Registrations with respect to such country
shall vest with Purchaser or its designated Affiliates, agents or
representatives on the Closing Date and shall remain with Purchaser or its
designated Affiliates, agents or representatives until legal ownership thereof
vests therein on the applicable Product Registration Transfer Date.
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ARTICLE 4
REPRESENTATIONS AND WARRANTIES
4.1 Representations and Warranties of Seller. Seller represents and
warrants to Purchaser, except as otherwise set forth herein, solely as of the
date of this Agreement, subject to such exceptions as are specifically disclosed
in the disclosure schedule dated as of the date hereof and supplied by the
Seller to Purchaser on or prior to the date hereof (the "Seller Disclosure
Schedule") as follows:
(a) Organization and Standing. Seller is a legal entity duly
organized, validly existing and in good standing under the Laws of the
jurisdiction of British Virgin Islands.
(b) Power and Authority; Binding Effect. Seller has all requisite
power and authority, and has taken all other actions necessary, to execute and
deliver and to perform, and to cause its Affiliates to perform, all of the
obligations of Seller and its Affiliates under this Agreement and the other
Transaction Documents to which such Seller is a party or by which it is bound
and to consummate the transactions contemplated herein and therein. Seller has
duly and properly taken all actions required by Law, its organizational
documents or otherwise to authorize the execution, delivery and performance by
it of its obligations under this Agreement and the other Transaction Documents
to be executed and delivered by it and the consummation of transactions
contemplated hereby and thereby. This Agreement has been duly and validly
executed and delivered by Seller and constitutes the legal, valid and binding
obligation of Seller, enforceable against it in accordance with its terms,
except as enforcement may be affected by bankruptcy, insolvency or other similar
laws and by general principles of equity. The other Transaction Documents to be
executed by Seller, when so executed and delivered, will be duly and validly
executed and delivered by Seller and will constitute the legal, valid, and
binding obligations of Seller, enforceable against it in accordance with their
respective terms, except as enforcement may be affected by bankruptcy,
insolvency or other similar laws and by general principles of equity.
(c) No Conflict. The execution, delivery, and performance of this
Agreement and the other Transaction Documents by Seller to which Seller is a
party or by which Seller is bound, including the granting of the Licenses, and
the consummation of the transactions contemplated hereby or thereby (i) is not
prohibited by, and will not result in the breach of, or a default under (1) any
provisions of Seller's (or its Affiliates') organizational documents, (2) any
Law applicable to such Seller or its Affiliates, (3) any contract to which
Seller or its Affiliates is a party, or (4) any order, writ, injunction,
judgment or decree to which such Seller or its Affiliates is bound or subject,
or (ii) will not result in the creation or imposition of any Lien upon any of
the Purchased Assets.
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(d) Financial Information. Seller has provided to Purchaser
historical sales information (including an itemized break down of gross sales to
net sales) relating to the Products in the Territory for the calendar years
2003, 2004 and through January 31, 2005, in each case itemized by country in the
Territory (collectively, the "Financial Information"). The Financial Information
was derived from, and is consistent with, the books and records of Seller and
its Affiliates and was prepared in good faith and fairly presents, in all
material respects, such sales information with respect to the Products for the
periods shown.
(e) Ownership of Assets. Seller or its Affiliates has good and valid
title in and to all of the Purchased Assets and at the Closing, Purchaser will
receive beneficial and legal title to all of the Purchased Assets, free and
clear of all Liens, except for Liens for taxes not yet due and payable. The
Purchased Assets constitute all of the assets owned by, or otherwise in the
possession of, Seller or its Affiliates relating to the Product in the
Territory. There are no pending, or, to the knowledge of Seller and its
Affiliates, threatened, Liens relating to the Purchased Assets.
(f) Litigation or Disputes. There is no material claim, action,
suit, proceeding, investigation, hearing, arbitration, judgment, decree,
injunction, rule or order with any Person, including any Governmental Authority
(each, a "Proceeding"), pending or, to the knowledge of Seller and its
Affiliates, threatened, with respect to the Purchased Assets, the Products in
the Territory or the assets, properties or rights subject to the Licenses, or
against any of Seller or its Affiliates relating to the Purchased Assets, the
Products in the Territory or the assets, properties or rights subject to the
Licenses, or that would otherwise delay or impair the ability of Seller and its
Affiliates to consummate the transactions contemplated by this Agreement or the
other Transaction Documents or to perform Seller's and its Affiliates'
obligations hereunder or thereunder.
(g) Intellectual Property.
(i) Seller owns or has the lawful right and license to use the
Licensed Intellectual Property and the Purchased Intellectual Property in the
Territory.
(ii) The Licensed Intellectual Property, the Purchased
Intellectual Property and the Licenses constitute all of the Intellectual
Property of Seller and its Affiliates related to the use, manufacture,
marketing, distribution, commercialization, research, importation, development
and sale of the Products in the Territory.
(iii) Neither the Licensed Intellectual Property nor the
Purchased Intellectual Property infringes upon, misappropriates, dilutes or
otherwise violates any confidential information, proprietary information or
intellectual property owned or controlled by any Third Party. None of Seller or
its Affiliates has received any written notice of a claim, and neither Seller
nor any of its Affiliates has knowledge of any written threatened claim, made by
any Third Party of infringement or misappropriation, or contesting the validity,
enforceability, use or ownership of the Licensed Intellectual Property, the
assets, properties or rights subject to the Licenses Intellectual Property or
the Purchased Intellectual Property. The Seller and its
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Affiliates have taken all reasonable precautions to protect the secrecy,
confidentiality and value of the Licensed Intellectual Property and the
Purchased Intellectual Property.
(iv) The Assigned Patents have been registered in the
jurisdictions set forth on Schedule 1.5 and the Product Trademarks have been
registered in the jurisdictions set forth on Schedule 1.42. The Purchased
Intellectual Property is freely assignable to Purchaser, in each case, free and
clear of any rights or claims of any Person and without the payment of any
royalties, license fees or other amounts to any Person. All registration,
maintenance and renewal fees due in connection with the Purchased Intellectual
Property have been paid in a timely manner at all times during the three (3)
year period immediately prior to the date hereof. To the knowledge of Seller and
its Affiliates, all other formal legal requirements to maintain in full force
the Assigned Patents and the Product Trademarks in the Territory have been
complied with. No Assigned Patent has been or is now involved in any
interference, reissue, reexamination or opposition proceeding and there is no
potentially interfering patent or patent application of any Third Party. All
Products made, used or sold in the Territory under the Assigned Patents have
been marked with the proper patent notice. No Product Trademark has been or is
now involved in any opposition, invalidation or cancellation and, to the
Seller's knowledge no such action is threatened with respect to any of the
Product Trademarks and there is no potentially interfering trademark or
trademark application of any Third Party. All Products made, used or sold in the
Territory have borne the proper United States or foreign registration notice
where required by applicable Law.
(v) Neither the Purchased Intellectual Property nor the
Licensed Intellectual Property is subject to any contractual obligation (i)
restricting Seller's or its Affiliates' use or rights thereof, (ii) entitling
Third Parties to use the same in the Territory or (iii) in any way obligating
any of Seller or its Affiliates to make royalty or similar payments to others.
None of Seller or its Affiliates has granted any license to a Third Party of any
kind or similar right relating to the assets, properties or rights subject to
the Licenses for use in connection with the Products in the Territory.
(vi) All former and current employees and contractors of the
Seller and its Affiliates have executed written contracts with the Seller or its
Affiliates that assign to Seller or its Affiliates all rights to all Licensed
Intellectual Property and Purchased Intellectual Property, including any
inventions, (whether or not patentable) improvements, discoveries or information
made during or derived from their relationship to Seller or its Affiliates, as
applicable.
(vii) Seller has, or within twenty (20) days following the
Closing shall, transfer to Purchaser full and accurate copies of all existing
Product Clinical Data.
(h) Compliance with Laws.
(i) The use, manufacture, marketing, distribution,
importation, commercialization, research, development and sale of the Products
in the Territory and the operation of the Purchased Assets are, and during the
three (3) years immediately prior to the date hereof have been, in compliance in
with the Product Registrations, the Product
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Specifications and all applicable Laws and regulatory requirements (including
FDA good clinical, good laboratory and good manufacturing practice
requirements).
(ii) (A) during the three (3) year period immediately prior to
the date hereof, there has not been any occurrence of any product recall, market
withdrawal or replacement, or post-sale warning conducted concerning the
Products in the Territory or any product recall, market withdrawal or
replacement conducted by or on behalf of any entity or Governmental Authority as
a result of any alleged defect in the Products and (B) during the three (3) year
period immediately prior to the date hereof, there has been no written
correspondence or written notice indicating or alleging that any Governmental
Authority has commenced or, to the knowledge of any of Seller or its Affiliates,
threatened to initiate, any action to withdraw its approval or request the
recall of any Product manufactured, marketed, distributed or sold in the
Territory, or commenced or, to the knowledge of Seller and its Affiliates,
threatened to commence, any action to enjoin the manufacture, marketing,
distribution or sale of a Product in the Territory.
(iii) The Product Registrations are in full force and effect
and have been in full force and effect at all times during the three (3) year
period immediately prior to the date hereof.
(iv) Seller has, or within twenty (20) days following the
Closing shall, transfer to Purchaser full and accurate copies of all of the
following with respect to the Products in the last three (3) years: (A) reports
of inspection observations in the Territory from any Governmental Authorities;
(B) establishment inspection reports in the Territory from any Governmental
Authorities; (C) warning letters from any Governmental Authority in the
Territory (including any 305 notices); and (D) any other material documents or
correspondence from any Governmental Authority in the Territory that assert or
allege (1) any ongoing material lack of compliance with any applicable Laws,
regulatory requirements, the Product Registrations or the Product Specifications
or (2) that any of the Product Registrations are not in good standing or that a
Product Registration may not be renewed.
(v) Seller has, or within twenty (20) days following the
Closing shall, transfer to Purchaser complete and accurate listing of all
pre-clinical and clinical studies and trials referenced in the IND, NDA or
Foreign Equivalent for the Product in the Territory, as amended from time to
time, together with the dates and brief descriptions of such studies, previously
or currently undertaken in the last three (3) years or otherwise sponsored by
(i) the Seller or its Affiliates, (ii) to the knowledge of the Seller's or its
Affiliates, its licensors and their respective affiliates and (iii) by any Third
Party investigator with any contact with the Seller and, to the knowledge of the
Seller, such Third Party's licensors. The Seller has provided to Purchaser true,
complete and accurate copies of all data and reports with respect to such
studies and trials, all material pre-clinical and material clinical studies and
trials and all other material information regarding the efficacy and safety of
the Products in the Territory. All preclinical and clinical trials conducted
with respect to the Product have been conducted in full compliance with all
applicable Laws (including FDA good clinical practice and good laboratory
practice requirements). In no such clinical trial has an Institutional Review
Board approval ever been suspended, terminated, put on clinical hold, or
voluntarily withdrawn.
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(vi) Except for the two adverse event related to
depigmentation, the Company is not aware of any safety, efficacy, regulatory,
legal, or other issues that could effect an existing or potential Regulatory
Approval with respect to the Product.
(vii) Neither the Seller nor its Affiliates, nor, to the
knowledge of the Seller, any officer, employee or agent of the Seller or its
Affiliates, has, with respect to the Product in the Territory, made an untrue
statement of a material fact or fraudulent statement to any Governmental
Authority, failed to disclose a material fact required to be disclosed to the
such Governmental Authority, or committed an act, made a statement, or failed to
make a statement that, at the time such disclosure was made, would reasonably be
expected to provide a basis for the a Governmental Authority to invoke its
policy respecting "Fraud, Untrue Statements of Material Fact, Bribery, and
Illegal Gratuities", set forth in 56 Fed Reg. 46191 (September 10, 1991) or any
similar policy. Neither the Seller nor its Affiliates, nor, to the knowledge of
the Seller, any officer, employee or agent of the Seller or any of its
Affiliates, has been convicted of any crime or engaged in any conduct for which
debarment is mandated by 21 U.S.C. Section 335a(a) or any similar law or
authorized by 21 U.S.C. Section 335a(b) or been charged with or convicted under
applicable Law for conduct relating to the development or approval, or otherwise
relating to the regulation of, the Product in the Territory under applicable Law
(including under the Generic Drug Enforcement Act of 1992). Neither the Seller
nor any of its Affiliates, or any of their agents or employees, have violated or
caused a violation of any federal or state health care fraud and abuse or false
claims statute or regulation, including the Medicare/Medicaid Anti-kickback
provisions of the Social Security Act, 42 U.S.C. Section 1320a-7b(b), and the
relevant regulations in 42 C.F.R. Part 1001 in connection with the Product in
the Territory.
(i) Contracts.
(i) None of Seller or its Affiliates is a party to, bound by,
or otherwise subject to, any material contract other than the Supply Agreement,
relating to the Purchased Assets or the Products manufactured, marketed,
distributed or sold in the Territory. Seller has delivered a true, complete and
accurate copy of the Supply Agreement except to the extent redacted to remove
provisions which relate to products other than the Products, including any
written amendments, written alterations or written correspondence that alter any
of the terms set forth therein.
(ii) (A) none of Seller or its Affiliates is in material
breach of, or default under, the Supply Agreement, and to knowledge of Seller
and its Affiliates, no event has occurred which, with the passage of time or
giving of notice, or both, would constitute such a default, (B) to the knowledge
of Seller and its Affiliates, there is no existing material breach or default by
any other party to the Supply Agreement, and (C) the Supply Agreement is in
effect on the date hereof and constitutes the legal, valid and binding
obligations of the parties thereto, enforceable in accordance with its terms,
except as enforcement may be affected by bankruptcy, insolvency or other similar
laws and by general principles of equity.
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(j) Inventory. All Inventory (A) was manufactured, packaged,
labeled, tested, stored and handled in compliance with all applicable Product
Specifications, Regulatory Approvals and all applicable Laws, (B) is
unadulterated, not misbranded, merchantable and fit for its intended purpose,
and (C) as of the Closing Date, will have not less than fifteen (15) months of
remaining shelf-life prior to its expiration.
(k) Sufficiency of Assets. The Purchased Assets (along with the
Licenses granted to Purchaser pursuant to Section 2.2) constitute all of the
assets which are necessary for Purchaser to use, manufacture, market,
distribute, import, commercialize, research, develop and sell of the Products in
the Territory as used, manufactured, marketed, distributed, imported,
commercialized, researched, developed and sold during the twelve (12) month
period immediately prior to the date hereof, other than: (i) equipment,
facilities and other tangible assets related to manufacturing, supply and
distribution of the Products; and (ii) inventory sold or disposed of in the
ordinary course of business, consistent with past practice.
4.2 Representations and Warranties of Purchaser. Purchaser represents and
warrants to Seller, except as otherwise set forth herein, solely as of the date
of this Agreement, subject to such exceptions as are specifically disclosed in
the disclosure schedule dated as of the date hereof and supplied by the Seller
to Purchaser on or prior to the date hereof (the "Purchaser Disclosure
Schedule"), as follows:
(a) Organization and Standing. Purchaser is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware.
(b) Power and Authority; Binding Effect. Purchaser has all requisite
corporate power and authority, and has taken all other actions necessary, to
execute and deliver and to perform all of its obligations under this Agreement
and the other Transaction Documents to which it is a party or by which it is
bound and to consummate the transactions contemplated herein and therein.
Purchaser has duly and properly taken all action required by Law, its
organizational documents or otherwise to authorize the execution, delivery and
performance of its obligations under this Agreement and the other Transaction
Documents to be executed and delivered by it and the consummation of the
transactions contemplated hereby and thereby. This Agreement has been duly
executed and delivered by Purchaser and constitutes the legal, valid, and
binding obligations of Purchaser, enforceable against it in accordance with its
terms, except as enforcement may be affected by bankruptcy, insolvency or other
similar laws and by general principles of equity. The Transaction Documents to
be executed and delivered by Purchaser, when so executed and delivered, will be
duly and validly executed and delivered and will constitute the legal, valid,
and binding obligations of Purchaser, enforceable against it in accordance with
their respective terms, except as enforcement may be affected by bankruptcy,
insolvency or other similar laws and by general principles of equity.
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(c) No Conflict. The execution, delivery, and performance of this
Agreement and the other Transaction Documents to which Purchaser is a party or
by which Purchaser is bound and the consummation of the transactions
contemplated hereby or thereby by Purchaser (i) is not prohibited or limited by,
and will not result in the breach of, or a default under (1) any provisions of
Purchaser's organizational documents, (2) any Law applicable to Purchaser, (3)
any Contract to which Purchaser is a party, or (4) any order, writ, injunction,
judgment or decree to which Purchaser is bound or subject, or (ii) will not
result in the creation or imposition of any Lien upon any of the Purchased
Assets.
(d) Litigation. There is no material Proceeding pending or, to the
knowledge of Purchaser, threatened, against Purchaser and, to Purchaser's
knowledge, Purchaser is not in violation of or in default with any applicable
Law, the result of any of which, either individually or cumulatively, would
prevent or materially delay or impair the ability of Purchaser to consummate the
transactions contemplated by this Agreement or the other Transaction Documents
to which Purchaser is to be a party or by which Purchaser is to be bound or to
perform Purchaser's obligations hereunder or thereunder.
4.3 Survival of Representations/Warranties. The representations and
warranties contained in this Article 4 shall survive the Closing Date for a
period of thirty-six (36) months; provided, however that the representations and
warranties contained in Sections 4.1(a), (b), (c), (e) and (g)(i) and Sections
4.2(a), (b) and (c) and Section 4.4 shall survive indefinitely.
4.4 Brokers. Each Party represents that no agent, broker, investment
banker, financial advisor or other Person, is or will be entitled to any
brokers' or finder's fee or any other commission or similar fee in connection
with any of the transactions contemplated by this Agreement.
ARTICLE 5
COVENANTS
5.1 Post-Closing Orders and Payments. From and after the Closing Date,
subject to the terms of the Distribution Agreement, Seller shall promptly
deliver to Purchaser any purchase orders for Products relating to the Territory
received after the Closing and any payments received from Third Parties for
Products purchased from Purchaser after the Closing, and refer all inquiries it
shall receive with respect to the Products in the Territory, to Purchaser or its
designee.
5.2 Chargebacks. Following the Closing Date, Purchaser shall be
responsible for all chargebacks, rebates and similar payments to wholesalers and
other distributors for the Product sold in the Territory by or on behalf of
Purchaser after the Closing Date; provided, however, that for a period following
the Closing Date, all such chargebacks shall be administered in accordance with
the Distribution Agreement. Notwithstanding the foregoing, Seller shall not
renew, and/or shall terminate, any such government and commercial contracts with
respect to the Product in the Territory following the Closing Date.
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5.3 Medicare, Medicaid and State Rebates. Seller shall be responsible for
the processing, payment and handling of all government (federal or state) rebate
programs related to the sale of Products labeled under Seller's or Galderma's
(or any of their affiliate's) NDC codes. Purchaser shall be responsible for the
processing, payment and handling of all government (federal or state) rebate
programs related to the sale of Products labeled under Purchaser's (or its
affiliate's) NDC codes.
5.4 Returns Due to Product Expiration and Other Returns. Following the
Closing Date, Seller shall be responsible for all liabilities attributable to
any Product in the Territory returned within twelve (12) months after the
Closing Date ("Returns"). After such twelve (12) month period, Purchaser shall
be solely responsible for all such Returns, whether or not such Product was sold
by Seller prior to the Closing Date.
5.5 Net Sales and Earn-Out Obligations.
(a) Statements and Payment. Within ninety (90) days after the end of
each semi-annual period, Purchaser shall deliver to Seller a report setting
forth for such calendar year the following information for the Products (each,
an "Earn-Out Report"): (A) Net Sales of such Product and (B) the amount of
Earn-Out Payments for such semi-annual period if any, due to Seller on account
of sales of such Product. For clarity, the first semi-annual period during the
Earn-Out term shall commence January 1, 2006 and ends on June 30, 2006. The
Earn-Out Payment, if any, due on account of Net Sales of Products during a given
semi-annual period shall be remitted by wire transfer in US dollars at the time
of delivery to Seller of the Annual Report for such semi-annual period, to the
credit of such bank account as shall be designated at least five (5) Business
Days in advance by Seller in writing to Purchaser. The obligations of Purchaser
under this Section 5.5(a) shall automatically terminate and be of no further
force and effect from and after the date Purchaser delivers the Annual Report
for the semi-annual period in which the Earn-Out Term ends.
(b) Maintenance of Records. Purchaser shall maintain, and shall
require its Affiliates and sublicensees to maintain, complete and accurate books
and records in connection with the sale of Products hereunder consistent with
United States generally accepted accounting principles, as necessary to allow
the accurate calculation of the Contingent Purchase Price payments and Earn-Out
Payments due to Seller. Such records shall be maintained for a period of at
least three (3) years after the end of the semi-annual period in which they were
generated.
5.6 Audit. Once per calendar year during the Earn-Out Term, Seller shall
have the right to engage an independent accounting firm, which shall have the
right to examine in confidence the relevant Purchaser records as may be
reasonably necessary to determine and/or verify the amount of Earn-Out Payments
or Contingent Purchase Price payment due to Seller hereunder. An audit of the
records for any given period must be conducted within one (1) year after the
termination of such period and only one audit may be conducted with respect to a
given period. Such examination shall be conducted and shall take place, and
Purchaser shall make its records available, during normal business hours, after
at least fifteen (15) days' prior written notice given to Purchaser by Seller,
at the facility(ies) where such records are maintained. The independent
accounting firm will prepare and provide to each Party a written report stating
whether the Annual Reports submitted and Earn-Out Payments or Contingent
Purchase Price
- 21 -
payment, as applicable, made with respect to the period subject to the audit
were correct or incorrect and the amounts of any discrepancies. In the event
that it was ultimately determined that there was an underpayment by Purchaser
hereunder, Purchaser shall promptly (but in no event later than thirty (30) days
after its receipt of the independent auditor's report so concluding) make
payment to Seller of any shortfall. In the event that it was ultimately
determined that there was an overpayment by Purchaser hereunder, Seller shall
promptly (but in no event later than thirty (30) days after Seller's receipt of
the independent auditor's report so concluding) refund to Purchaser the excess
amount. All costs of the audit, including the expenses of the independent
accounting firm, shall be borne and promptly paid by Seller.
5.7 Right of First Refusal. In the event that Seller or its Affiliates
propose to grant rights to a Third Party to distribute the Product outside the
Territory or license or otherwise divest rights to the Product outside the
Territory (a "Proposed Transaction"), then Seller shall provide Purchaser
written notice thereof prior to consummation of such Proposed Transaction
together with a description of the terms of the Proposed Transaction. If, within
fifteen (15) days after receipt of such notice, Purchaser notifies Seller in
writing that Purchaser desires to enter into the Proposed Transaction on such
terms, Purchaser and Seller shall negotiate definitive agreements to consummate
such Proposed Transaction exclusively and in good faith for a period of sixty
(60) days from the date of Purchaser's notice. If the Parties are unable to
mutually agree upon such definitive agreements for the Proposed Transaction
within such sixty (60) day period, Seller shall be permitted to negotiate the
Proposed Transaction with any Third Party. In the event that Seller negotiates
terms of a Proposed Transaction (the "Final Terms") with a Third Party that are
substantially equivalent to, or more favorable to the Third Party than, the
terms last negotiated by Purchaser and rejected by Seller prior to the
conclusion of the negotiations between Purchaser and Seller, Seller shall give
written notice thereof to Purchaser together with a copy of such Final Terms.
Upon receipt of such notice, Purchaser shall have thirty (30) days to accept the
Proposed Transaction on the Final Terms via written notice to Seller. If
Purchaser does not provide Seller written notice of its intent to consummate the
Proposed Transaction on the Final Terms within such thirty (30) day period,
Seller may consummate the Proposed Transaction on the Final Terms with the Third
Party.
5.8 Restrictions on Sale of Products. For a period of seven (7) years
after the Closing Date (the "Non-Compete Period"), none of Seller or its
Affiliates shall (a) research, develop, market, distribute or manufacture any
other pharmaceutical product containing the API for sale within the Territory
(collectively, a "Competitor Product") or (b) agree to research, develop,
market, sell, distribute or manufacture a Competitor Product for any other
Person for sale of such Competing Product by such other Person in the Territory.
5.9 No Obligation to Supply. Notwithstanding the assignment to Purchaser
of the Supply Agreement, Purchaser undertakes no obligation to supply Product to
Seller for sale outside the Territory.
- 22 -
5.10 Patent Prosecution and Maintenance.
(a) Whenever Seller determines, at its sole discretion, not to file,
or to discontinue prosecution, maintenance or extension of any patent or patent
application related to the Assigned Patents including foreign counterpart
patents and patent applications outside of the U.S. and Canada, Seller shall so
notify Purchaser in writing at least sixty (60) days prior to such
discontinuation, or such shorter time is as is reasonable under the
circumstances, so that Purchaser can proceed to maintain such patent or
application at Purchaser's option and expense and, at which point, and without
further consideration, Seller shall facilitate at Purchaser's sole cost and
expense, the assignment of such patent is to Purchaser; and
(b) Seller shall use reasonable efforts to forward copies of any
publication cited by Seller or an applicable foreign or international patent
authority during prosecution of any patent application related to the Assigned
Patents including foreign counterpart patent applications outside of the U.S.
and Canada within thirty (30) days of citation of such publication.
5.11 Trademarks. Under no circumstances will Seller or its Affiliates, or
any licensee thereof, distribute products competitive with the Products under
the SOLAGE trademark or any confusingly similar trademark in the Territory.
Under no circumstances will Purchaser or its Affiliates, or any licensee
thereof, distribute products competitive with the Products under the SOLAGE
trademark or any confusingly similar trademark outside of the Territory.
ARTICLE 6
INDEMNIFICATION
6.1 Indemnification by Seller. From and after the Closing Date, Seller
shall reimburse and indemnify Purchaser, Purchaser's Affiliates, and their
respective officers, directors, employees, legal representatives and agents in
respect of, and hold each of them harmless from and against, any and all Losses
suffered, incurred or sustained by any of them or to which any of them becomes
subject, resulting from, arising out of or relating to:
(a) the Retained Liabilities;
(b) subject to any disclosure in the Seller Disclosure Schedule, any
misrepresentation or breach of warranty by Seller made or contained in this
Agreement;
(c) any failure of Seller to perform or observe any covenant or
agreement to be performed or observed by Seller pursuant to this Agreement; and
(d) any action or inaction of Seller with respect to the Products in
the Territory or the Purchased Assets prior to the Closing Date except for
Losses arising as a result of Liabilities expressly included in the Assumed
Liabilities.
- 23 -
6.2 Indemnification by Purchaser. From and after the Closing Date,
Purchaser shall reimburse and indemnify Seller, Seller's Affiliates and their
respective officers, directors, employees and agents in respect of, and hold
each of them harmless from and against, any and all Losses suffered, incurred or
sustained by any of them or to which any of them becomes subject, resulting
from, arising out of or relating to:
(a) the Assumed Liabilities;
(b) subject to any disclosure in the Purchaser Disclosure Schedule,
any misrepresentation or breach of warranty by Purchaser made or contained in
this Agreement;
(c) any failure by Purchaser to duly perform or observe any covenant
or agreement to be performed or observed by Purchaser pursuant to this
Agreement; and
6.3 Limitation of Liability.
(a) The maximum aggregate liability of Seller under Sections 6.1(b)
shall not exceed $5,000,000.
(b) The maximum aggregate liability of Purchaser under Sections
6.2(b) shall not exceed $5,000,000.
6.4 Procedures for Indemnification for Third Party Claims.
(a) In the event of any claim or demand made by any Person who is
not a Party to this Agreement (or an Affiliate thereof) ("Third Party Claim")
which relates to circumstances under which, in accordance with Section 6.1 or
6.2, a Party (the "Indemnitor") may be obligated to provide indemnification
pursuant to this Agreement, such Party seeking indemnification hereunder
("Indemnitee") will notify the Indemnitor in writing of the Third Party Claim
(and specifying in reasonable detail the factual basis for the Third Party Claim
and to the extent known, the amount of the Third Party Claim) reasonably
promptly after becoming aware of such Third Party Claim; provided, however, that
failure to give such notification will not affect the indemnification provided
hereunder except to the extent the Indemnitor shall have been actually
prejudiced as a result of such failure.
(b) If a Third Party Claim is made against an Indemnitee, the
Indemnitor will be entitled, within sixty (60) days after receipt of written
notice from the Indemnitee, under Section 6.4(a), of the commencement or
assertion of any such Third Party Claim, to assume the defense thereof (at the
expense of the Indemnitor) with counsel selected by the Indemnitor and
reasonably satisfactory to the Indemnitee, for so long as the Indemnitor is
conducting a good faith and diligent defense. Should the Indemnitor so elect to
assume the defense of a Third Party Claim:
- 24 -
(i) the Indemnitor will not be liable to the Indemnitee for
any legal or other expenses subsequently incurred by the Indemnitee in
connection with the defense thereof; provided, that if under applicable
standards of professional conduct a conflict of interest exists between the
Indemnitor and the Indemnitee in respect of such claim, such Indemnitee shall
have the right to employ separate counsel (which shall be reasonably
satisfactory to the Indemnitor) to represent such Indemnitee with respect to the
matters as to which a conflict of interest exists and in that event the
reasonable fees and expenses of such separate counsel shall be paid by such
Indemnitor; provided, further, that the Indemnitor shall only be responsible for
the reasonable fees and expenses of one separate counsel for such Indemnitee;
(ii) the Indemnitee shall have the right to participate in the
defense thereof and to employ counsel, at its own expense, separate from the
counsel employed by the Indemnitor;
(iii) the Indemnitor and Indemnitee will promptly supply to
the other copies of all correspondence and documents relating to or in
connection with such Third Party Claim and keep the other informed of
developments relating to or in connection with such Third Party Claim, as may be
reasonably requested by the Indemnitee or Indemnitor, as applicable (including
providing to the Indemnitee or Indemnitor, as applicable, on reasonable request
updates and summaries as to the status thereof); and
(iv) all Indemnitees shall reasonably cooperate with the
Indemnitor in the defense, and in the conduct of discussions for settlement,
compromise or discharge, thereof (such cooperation to be at the expense,
including reasonable legal fees and expenses, of the Indemnitor).
(c) If the Indemnitor does not elect to assume control of the
defense thereof within the sixty (60) day period set forth above, or if such
good faith and diligent defense is not being or ceases to be conducted by the
Indemnitor, the Indemnitee shall have the right, at the expense of the
Indemnitor, after three (3) Business Days notice to the Indemnitor of its intent
to do so, to undertake the defense of the Third Party Claim (with counsel
selected by the Indemnitee), and to compromise or settle such Third Party Claim,
exercising reasonable business judgment.
(d) If the Indemnitor acknowledges in writing its obligation to
indemnify the Indemnitee for a Third Party Claim, the Indemnitee will agree to
any settlement, compromise or discharge of such Third Party Claim that the
Indemnitor may recommend that by its terms obligates the Indemnitor to pay the
full amount of Losses (whether through settlement, compromise or discharge) in
connection with such Third Party Claim and unconditionally and irrevocably
releases the Indemnitee completely from all Liability in connection with such
Third Party Claim; provided, however, that, without the Indemnitee's prior
written consent, the Indemnitor shall not consent to any settlement, compromise
or discharge (including the consent to entry of any judgment), and the
Indemnitee may refuse to agree to any such settlement, compromise or discharge,
that provides for injunctive or other equitable or other nonmonetary relief
affecting the Indemnitee, the Products in the Territory or the Purchased Assets.
If the
- 25 -
Indemnitor acknowledges in writing its obligation to indemnify the Indemnitee
for a Third Party Claim, the Indemnitee shall not (unless required by applicable
Law) admit any liability with respect to, or settle, compromise or discharge,
such Third Party Claim without the Indemnitor's prior written consent (which
consent shall not be unreasonably withheld or delayed).
6.5 Losses That Are Not Third Party Claims. Any claim on account of Losses
which does not involve a Third Party Claim shall be asserted by reasonably
prompt written notice (stating in reasonable detail, the basis of such claim and
a reasonable estimate of the amount thereof) given by the Indemnitee to the
Indemnitor from whom such indemnification is sought. For a period of sixty (60)
days from and after receipt of the written notice, the Parties shall attempt in
good faith to resolve such claim for indemnification. If the Parties are unable
to resolve such claim, the Party seeking indemnification may thereafter pursue
any and all remedies at its disposal to enforce said indemnification claim.
6.6 Termination of Indemnification Obligations. The obligations of each
Party to indemnify, defend and hold harmless the other Party and other
Indemnitees pursuant to Sections 6.1(b) and 6.2(b) shall terminate when the
applicable representation or warranty expires pursuant to Section 4.3; provided,
however, that such obligations to indemnify, defend and hold the Indemnitee
harmless shall not terminate with respect to any individual item as to which the
Indemnitee shall have before the expiration of the survival period, made a claim
by delivering a written notice (stating in reasonable detail the basis of such
claim and a reasonable estimate of the amount thereof) to the Indemnitor.
(a) Other Matters. In the event of payment in full by an Indemnitor
to any Indemnitee in connection with any Third Party Claim, such Indemnitor will
be subrogated to and shall stand in the place of such Indemnitee as to any
events or circumstances in respect of which such Indemnitee may have any right
or claim relating to such Third Party Claim against any claimant or plaintiff
asserting such Third Party Claim or against any other Person. Such Indemnitee
will cooperate with such Indemnitor in a reasonable manner, and at the cost and
expense of such Indemnitor, in prosecuting any subrogated right or claim.
ARTICLE 7
GENERAL PROVISIONS
7.1 Payment of Transaction Expenses. All legal fees and other expenses
incurred by Seller in connection with the negotiation of this Agreement and the
consummation of the transactions contemplated herein will be borne by Seller
whether or not the Closing shall have occurred. All legal fees and other
expenses incurred by Purchaser in connection with the negotiation of this
Agreement and the consummation of the transactions contemplated herein will be
borne by Purchaser, whether or not the Closing shall have occurred.
7.2 Taxes. Seller shall be responsible for and shall promptly pay all
transfer (including transfer of goodwill), sales, registrations, withholdings
and other Taxes and fees (other than fees paid or payable to attorneys, bankers,
agents, consultants or other Third Parties engaged by or on behalf of
Purchasers), if any, levied or imposed as a result of the consummation of the
transactions contemplated by this Agreement, including any fees required
- 26 -
in connection with filing any assignments, notification or registration with a
Governmental Authority in order to effectuate the transfer of the Product
Registrations and the Product Trademarks, Assigned Patents, but excluding any
Taxes payable on any income or gain of Purchaser. If a withholding Tax is
required by law to be paid on any sum due to Seller hereunder, Purchaser shall
deduct such Tax from the payment to be made to Seller and remit such payment on
Seller's behalf to the appropriate Governmental Authority. Purchaser shall
provide Seller with all receipts and documentation relating to such withholding
Tax. Seller and Purchaser hereby agree to cooperate with each other with respect
to their complying with any tax obligations under tax regulations, especially
with regard to the preparation of certifications of tax exemption or
reimbursement relative to withholding taxes levied on payments to Seller
pursuant to this Agreement. Seller shall have the right to appeal to the
appropriate tax authority any such withholding and payments of any such tax. All
charges including bank commissions for the Tax remittance shall be borne by
Purchaser.
7.3 Notices. Except as otherwise specifically provided herein, any notice
or other documents to be delivered by a Party under this Agreement shall be in
writing and shall be deemed to have been duly given if sent by registered mail,
nationally recognized overnight courier or facsimile transmission (with
confirmation of receipt) to a Party or delivered in person to a Party at the
address or facsimile number set out below for such Party or such other address
as the Party may from time to time designate by written notice to the other:
If to Purchaser, to:
Barrier Therapeutics, Inc.
000 Xxxxxxx Xxxx Xxxx
Xxxxx 0000
Xxxxxxxxx, Xxx Xxxxxx 00000
Facsimile: (000) 000-0000
Attn: Chief Commercial Officer
with a copy to:
Xxxxxx, Xxxxx & Xxxxxxx LLP
000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Facsimile: (000) 000-0000
Attn: Xxxxx Xxxxxx, Esq.
If to Seller to:
Xxxxxxxx Enterprises Limited
Helguera 2756
X0000XXX Xxxxxx Xxxxx
Xxxxxxxxx
Facsimile: x00 (00) 0000-0000
Attn: Xxxxx Xxxxxx
with a copy to:
- 27 -
Estudio Jait
Xxxxxx 00, Xxxx 0 Xx. X
X0000XXX Xxxxxx Xxxxx, Xxxxxxxxx
Facsimile: 00-00-0000-0000
Attn: Dr. Aldo Jait
Any such notice or other document shall be deemed to have been received by the
addressee five (5) Business Days following the date of dispatch of the notice or
other document by post or, where the notice or other document is sent by
overnight courier, by hand or is given by facsimile, simultaneously with the
transmission or delivery. Notwithstanding the foregoing, any notice given by
facsimile shall also be sent by another means of delivery pursuant to this
Section 7.3.
7.4 Entire Agreement. This Agreement and the other Transaction Documents
embody and set forth the entire agreement and understanding of the Parties with
respect to the subject matter herein and there are no promises, terms,
conditions or obligations, oral or written, expressed or implied, other than
those contained in this Agreement or the other Transaction Documents. The terms
of the Transaction Documents shall supersede all previous oral or written
agreements which may exist or have existed between the parties relating to the
subject matter hereof and thereof.
7.5 Confidentiality; Public Disclosures.
(a) For the purposes of this Agreement, "Confidential Information"
shall mean any information relating to the Purchased Assets, this Agreement, the
other Transaction Documents and the transactions contemplated hereby or thereby
(including information delivered to Purchaser prior to the date hereof in
connection with the Products or the transactions contemplated herein); provided,
however, that the Confidential Information shall not include any information
which is in the public domain or becomes generally known through no wrongful act
of the part of Seller.
(b) No announcement or other disclosure, public or otherwise,
concerning the Purchase Price or other material financial terms of this
Agreement shall be made, either directly or indirectly, by any Party without
first obtaining the written approval of the other Party and obtaining the
agreement of the nature and text of such announcement or disclosure, such
approval and agreement not to be unreasonably withheld, delayed or conditioned.
Notwithstanding the foregoing:
(i) Each Party agrees that disclosures shall be made to the
Securities and Exchange Commission ("SEC") and other Governmental Authorities
and each Party agrees that it shall reasonably cooperate with the other with
respect to all disclosures regarding this Agreement to such Governmental
Authorities. Seller acknowledges that Purchaser shall file a copy of this
Agreement with the SEC, together with any exhibits or schedules as Purchaser may
choose to include.
- 28 -
(ii) The Parties shall be free to publicly disclose
information contained in any materials that have been previously approved for
public disclosure by the other Party, without further approvals from the other
Party hereunder, to the extent there have been no material additions or changes
thereto.
7.6 Modifications and Amendments. This Agreement shall not be amended,
modified, varied or supplemented except in writing signed a duly authorized
representative of Seller, on the one hand, and Purchaser, on the other hand.
7.7 Assignment. Neither this Agreement nor any of the rights or
obligations of the Parties hereunder may be assigned by any Party without the
prior written consent of the other Party, which consent shall not be
unreasonably withheld, conditioned or delayed; provided, however, that either
Party shall be entitled, without the prior written consent of the other to
assign its rights and obligations hereunder in connection with a merger or
similar reorganization or the sale of all or substantially all of its assets.
Any attempted assignment or delegation in contravention hereof shall be null and
void. Subject to the foregoing, this Agreement and all rights and powers granted
and obligations created hereby will bind and inure to the benefit of the Parties
hereto and their respective successors and assigns.
7.8 Headings, Interpretation. The headings used in this Agreement are for
convenience only and are not a part of this Agreement nor affect the
interpretation of any of its provisions.
7.9 Independent Parties. This Agreement shall not be deemed to create any
partnership, joint venture, amalgamation or agency relationship between the
Parties. Each Party shall act hereunder as an independent contractor. Neither
Party shall at any time enter into, incur, or hold itself out to Third Parties
as having authority to enter into or incur, on behalf of the other party, any
commitment, expense, or liability whatsoever.
7.10 Governing Law. This Agreement shall be governed by and construed
under the substantive laws of the State of New York, without giving effect to
the choice of law provisions thereof.
7.11 Jurisdiction; Waiver of Jury Trial. Any legal action or proceeding
with respect to this Agreement below shall be brought in the courts of the
United States of America for the Southern District of New York. By execution and
delivery of this Agreement, each of the parties hereto accepts for itself and in
respect of its property, generally and unconditionally, the exclusive
jurisdiction of the aforesaid court. EXCEPT AS PROHIBITED BY LAW, EACH PARTY
HERETO WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH
THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
- 29 -
7.12 Waiver. Neither the failure nor delay on the part of a Party to
require the strict performance of any term, covenant or condition of this
Agreement or to exercise any right or remedy available on a breach thereof shall
constitute a waiver of any such breach or of any such term or condition. The
consent to, or the waiver of, any breach, or the failure to require on any
single occasion, the performance or timely performance of any term, covenant, or
condition of this Agreement shall not be construed as authorizing any subsequent
or additional breach and shall not prevent a subsequent enforcement of such
term, covenant, or condition.
7.13 Severability. In the event that any provision of this Agreement or
the application thereof to any Party or circumstance shall be finally determined
by a court of proper jurisdiction to be invalid or unenforceable to any extent,
then (i) a suitable and equitable provision shall be substituted therefore in
order to carry out, so far as may be valid and enforceable, the intent and
purpose of such invalid and unenforceable provision and (ii) the remainder of
this Agreement and the application of such provision to the Parties or
circumstances other than those to which it is held invalid or unenforceable
shall not be affected thereby.
7.14 Counterparts; Facsimile Signatures. This Agreement may be executed in
counterparts, each of which shall be deemed an original, and all of which
together shall constitute a single agreement. This Agreement may be executed by
facsimile signatures, which signatures shall have the same force and effect as
original signatures.
7.15 No Third Party Beneficiaries. No Person other than Seller and
Purchaser and permitted assignees hereunder shall be deemed an intended
beneficiary hereunder or have any right to enforce any term of this Agreement.
7.16 Further Assurances. Each Party shall execute and deliver (and Seller
shall cause its Affiliates to execute and deliver) such additional instruments
and other documents and use (and Seller shall cause its Affiliates to use) all
reasonable efforts to take, or cause to be taken, all actions and to do, or
cause to be done, all things necessary under applicable Law or reasonably
requested by the other Party to consummate the transactions contemplated hereby
or by the other Transaction Documents and to confirm and assure the transfer of
the Purchased Assets to Purchaser or the grant of the Licenses granted in
Section 2.2.
7.17 Certain Conventions. As used in this Agreement, the masculine shall
include the feminine and neuter, the singular shall include the plural and the
plural shall include the singular, as the context may require. The word
"including" shall be deemed followed by "without limitation", "but not limited
to" or words of similar meaning.
7.18 No Strict Construction. This Agreement has been prepared jointly and
shall not be strictly construed against either Party.
7.19 Bulk Sales Laws. The Parties hereby waive compliance with any UCC
bulk sales or comparable statutory provisions of each applicable jurisdiction.
- 30 -
7.20 Currency. Except as otherwise specifically stated herein, all
payments and other amounts reflected herein shall be in US Dollars. In those
cases where the amount due in US Dollars is calculated based upon one or more
currencies other than US Dollars (including sales of Products in local
currencies for the purpose of calculating the Earn-Out Payment hereunder), such
amounts shall be converted to US Dollars using the daily average historical
inter-bank exchange rate as published by OANDA on its worldwide website
(xxx.xxxxx.xxx) for (i) each day of the month preceding the event requiring
conversion for payments other than Earn-Out Payments and (ii) each day of the
applicable calendar year for Earn-Out Payments.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
- 31 -
IN WITNESS WHEREOF, the Parties hereto have each caused this Agreement to
be duly executed as of the date first above written.
SELLER:
XXXXXXXX ENTERPRISES LIMITED
By: /s/ Xxxxx Xxxxxx
------------------------------------
Name: Xxxxx Xxxxxx
Title: Attorney-in-Fact
PURCHASER:
BARRIER THERAPEUTICS, INC.
By: /s/ Xx Xxxxxxxx
------------------------------------
Name: Xx Xxxxxxxx
Title: Chief Commercial Officer
SIGNATURE PAGE TO
PRODUCT ACQUISITION AND LICENSE AGREEMENT
Schedule 1.5: "Assigned Patents"
Patent Expiration
Country Number Filing Date Legal Status Issued Date Date
------- ------ ----------- ------------ ----------- ----
USA 5194247 24/07/1990 Issued 16/03/1993 16/03/2010
USA 5470567 25/10/1993 Issued 28/11/1995 28/11/2012
USA 6353029 24/08/2000 Issued 05/03/2002 24/08/2020
Canada 2022917 08/08/1990 Issued 18/04/1995 08/08/2010
Canada 2419877 03/08/2001 Pending 03/08/2021
Schedule 1.36: "Product Domain Names"
xxx.xxxxxx.xxx
Schedule 1.39: "Product Registrations"
First Registration Current Registration
Country Local Name Date Number
------- ---------- ---- ------
Canada SOLAGE 17-JAN-2001 02243257
USA SOLAGE (mequinol, 2% 10-DEC-1999 NDA 20-922
tretinoin, 0.01%) Topical
Solution
Schedule 1.40 : "Product Regulatory Documentation"
- All communication with the FDA regarding IND 40,038 and NDA 20-922
- All communication with Health Canada regarding DIN 02243257
- Schedule 1.42 : "Product Trademarks"
Trademark: SOLAGE
Country: USA
Classes: 5
Status: Registered
App. Number: 76366718
App. Date: 31-JAN-2002
Reg. Number: 2744436
Reg. Date: 29-JUL-2003
Expir. Date: 29-JUL-2013
Trademark: SOLAGE
Country: USA
Classes: 5
Status: Registered
App. Number: 75607704
App. Date: 15-DEC-1998
Reg. Number: 2672463
Reg. Date: 07-JAN-2003
Expir. Date: 07-JAN-2013
Trademark: SOLAGE
Country: Canada
Status: Registered
App. Number: 899999
App. Date: 16-DEC-1998
Reg. Number: TMA577653
Reg. Date: 19-MAR-2003
Expir. Date: 19-MAR-2018
Trademark: SOLAGE with accent (solage)
Country: Canada
Status: Registered
App. Number: 1142172
App. Date: 29-MAY-2002
Reg. Number: TMA596392
Reg. Date: 03-DEC-2003
Expir. Date: 03-DEC-2018
