Confidential Treatment
ACQUISITION OPTION AGREEMENT
THIS ACQUISITION OPTION AGREEMENT, dated this 5th day
of May, 1997, is entered into by and among NOVALON
PHARMACEUTICAL CORPORATION, a Delaware corporation (the
"Corporation"), each of the persons whose signature appears
in the signature pages of this Agreement under the caption
"Novalon Stockholders" (collectively, the "Novalon
Stockholders" and each individually a "Novalon
Stockholder"), and CUBIST PHARMACEUTICALS, INC., a Delaware
corporation ("Cubist").
WHEREAS, pursuant to the terms of that certain Series B
Convertible Preferred Stock Purchase Agreement, dated of
even date herewith (the "Series B Stock Purchase
Agreement"), between the Corporation and Cubist, the
Corporation has agreed to issue and sell to Cubist, and
Cubist has agreed to purchase from the Corporation, ********
shares of the Series B Convertible Preferred Stock, $.001
par value per share, of the Corporation, upon the terms and
subject to the conditions set forth therein; and
WHEREAS, it is a condition precedent to the
consummation by Cubist of all of its obligations under the
Series B Stock Purchase Agreement that the Corporation and
the Novalon Stockholders enter into this Agreement.
NOW, THEREFORE, in consideration of the mutual
covenants and agreements herein contained, the parties
hereto, intending to be legally bound, hereby agree as
follows.
SECTION 1. DEFINITIONS. The following terms as used
herein shall have the meanings set forth below in this
Section 1 or shall have the meanings ascribed thereto
elsewhere as referred to below in this Section 1:
"Acquisition Closing" shall have the
meaning ascribed to such term in Section 2.4
hereof.
"Acquisition Closing Date" shall mean
the date of the Acquisition Closing.
"Affiliate" shall mean, with regard to
any Person, any other Person or entity that
directly or indirectly controls, or is
controlled by, or is under common control
with, such Person.
"Agreement" and "this Agreement" shall
mean this Acquisition Option Agreement, as
amended from time to time.
* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
"Average Trading Price Per Share" shall
mean the average of the closing sale prices
per share of Cubist Common Stock on the
Nasdaq Stock Market, as reported in the Wall
Street Journal, ***************************
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"Code" shall mean the Internal Revenue
Code of 1986, as amended.
"Collaboration" shall have the meaning
ascribed to such term in the Series B Stock
Purchase Agreement.
"Corresponding Novalon Stock Option"
shall mean, with respect to any Substitute
Stock Option, the Novalon Stock Option in
substitution of which such Substitute Stock
Option was granted pursuant to, and in
accordance with, the provisions of Section
2.5 hereof.
"Cubist Common Stock" shall mean the
common stock, $.001 par value per share, of
Cubist.
"Encumbrances" shall mean any claims,
liens, pledges, options, charges, security
interests, mortgages, conditional sales
agreements, contingent sales agreements, any
title retention agreements, leases,
encumbrances or other rights of third
parties, whether voluntarily incurred or
arising by operation of law, including,
without limitation, any agreement to give any
of the foregoing in the future.
"Exchange Act" shall mean the Securities
Exchange Act of 1934, as amended.
"Novalon Common Stock" shall mean the
common stock, $.001 par value per share, of
the Corporation.
"Novalon Outstanding Stock" shall mean
all shares of any and all classes or series
of capital stock of the Corporation that are
outstanding immediately prior to the
Acquisition Closing; provided, however, that
the term "Novalon Outstanding Stock" shall
not include any shares of any class or series
of capital stock of the Corporation that are
owned by Cubist.
"Novalon Stock Option" shall have the
meaning ascribed to such term in Section 2.5
hereof.
"Person" shall mean an individual,
partnership, corporation, association,
limited liability company, trust, joint
venture, unincorporated
* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
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organization, and any government, governmental
department or agency or political subdivision thereof.
"Securities Act" shall mean the
Securities Act of 1933, as amended.
"Subsidiaries" shall mean, collectively,
all corporations, partnerships, limited
liability companies or other Persons with
respect to which the Corporation shall own,
directly or indirectly, more that fifty
percent (50%) of the issued and outstanding
equity interests of such corporations,
partnerships, limited liability companies or
other Persons.
"Substitute Stock Option" shall have the
meaning ascribed to such term in Section 2.5
hereof.
"UNC" shall mean The University of North
Carolina at Chapel Hill.
SECTION 2. ACQUISITION OPTION.
2.1. Option to Acquire Stock.
(a) Subject to and upon the terms and conditions
set forth in this Section 2, Cubist shall have the option
(but not the obligation) to acquire all of the Novalon
Outstanding Stock (the "Acquisition Option"). The
Acquisition Option may only be exercised by Cubist during
the period commencing on the date hereof and ending on
************* (the "Acquisition Option Period"). Cubist
shall exercise the Acquisition Option by giving written
notice of exercise to the Corporation (the "Exercise
Notice"), which Exercise Notice shall specify the proposed
structure of the transaction pursuant to which Cubist shall
acquire all of the Novalon Outstanding Stock and the
proposed date by which such transaction will be consummated.
The Corporation shall send to each Novalon Stockholder a
copy of the Exercise Notice promptly after receipt thereof
by the Corporation.
(b) In the event that Cubist shall not have
exercised the Acquisition Option on or prior to
**************** and that Cubist shall not have terminated
this Agreement pursuant to Section 12(a) hereof, then
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* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
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2.2. Structure of the Transaction; Acquisition
Agreement. Upon exercise by Cubist of the Acquisition
Option pursuant to, and in accordance with, the provisions
of Section 2.1 above, the acquisition by Cubist of all of
the Novalon Outstanding Stock (the "Acquisition") shall be
effected pursuant to a transaction structured as a merger, a
reverse or forward triangular merger, an asset acquisition,
a stock acquisition or otherwise, as may be selected and
requested by Cubist and specified in the Exercise Notice to
be delivered to the Corporation and the Novalon Stockholders
pursuant to Section 2.1 hereof. The Corporation hereby
acknowledges and agrees that the structure of any such
transaction may require that its separate corporate
existence terminate, such as, for example, in the case of a
merger or a reverse triangular merger. Each Novalon
Stockholder hereby acknowledges and agrees that, in the
event that the structure of any such transaction is a stock
acquisition, he will sell or cause to be sold to Cubist all
of the shares of capital stock of the Corporation owned by
such Novalon Stockholder on the Acquisition Closing Date.
The Corporation and the Novalon Stockholders hereby
acknowledge and agree that, in the event that Cubist
exercises the Acquisition Option, the Corporation and the
Novalon Stockholders will be required to enter into an
acquisition agreement with Cubist and/or its Subsidiaries or
Affiliates pursuant to which the Acquisition will be
consummated, and that the terms and conditions of any such
acquisition agreement shall include and/or be consistent
with all of the terms set forth in this Agreement and shall
include such other reasonable terms and provisions
(including representations and warranties, covenants,
indemnification provisions and conditions to closing) as are
customary for similar transactions (any such acquisition
agreement being hereinafter referred to as the "Definitive
Acquisition Agreement"). Upon the execution and delivery of
the Definitive Acquisition Agreement, this Agreement shall
be deemed to have been terminated and superseded by the
Definitive Acquisition Agreement. The failure of the
parties to mutually agree upon and enter into the Definitive
Acquisition Agreement shall in no way relieve the
Corporation and the Novalon Stockholders from their
respective obligations hereunder to consummate the
Acquisition upon and subject to the terms and provisions of
this Agreement. The failure or refusal of any party hereto
to enter into the Definitive Acquisition Agreement having
reasonable and customary terms and conditions shall be a
material breach of such party's obligations under this
Agreement.
* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
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2.3. Consideration; Escrow; Adjustments.
(a) The aggregate purchase price payable by
Cubist for the Novalon Outstanding Stock shall be
************* (the "Purchase Price"), subject to adjustment
pursuant to Section 2.3(b) hereof (the Purchase Price, as so
adjusted, being referred to herein as the "Adjusted Purchase
Price"). At the Acquisition Closing, Cubist shall make
payment of such aggregate purchase price by issuing to the
Novalon Stockholders, as a group, that number of shares of
Cubist Common Stock (the "Consideration Shares") as shall be
equal to the quotient obtained by dividing (i) the Adjusted
Purchase Price by (ii) the Average Trading Price Per Share.
Cubist shall not be required to issue any fractional share,
but, in lieu thereof, Cubist shall make a cash payment equal
to the product obtained by multiplying (x) such fractional
share by (y) the Average Trading Price Per Share. The
Consideration Shares and any cash payment made in lieu of
any fractional share shall be allocated among the Novalon
Stockholders ratably in proportion to the respective number
of shares of Novalon Common Stock owned by the Novalon
Stockholders immediately prior to the Acquisition Closing.
(b) The Purchase Price shall be reduced by the
aggregate amount of any liabilities incurred by the
Corporation after December 31, 1996 that are outside the
ordinary course of business of the Corporation.
(c) Notwithstanding anything in Section 2.3(a) to
the contrary, Cubist shall be entitled to hold-back up to
ten percent (10%) of the Consideration Shares in escrow
until the third anniversary of the Acquisition Closing.
Cubist shall be entitled to proceed against any of the
Consideration Shares held in escrow in the event that Cubist
shall have any claim for indemnification against the Novalon
Stockholders.
(d) Notwithstanding anything in Section 2.3(a) to
the contrary, Cubist shall be entitled (but not required) to
pay up to twenty percent (20%) of the Purchase Price in
cash, in which case the number of Consideration Shares shall
be ratably adjusted based on the Average Trading Price Per
Share.
2.4. Closing. If, but only if, the Acquisition Option
is exercised by Cubist pursuant to, and in accordance with,
the provisions of Section 2.1 above, the closing of the
Acquisition (the "Acquisition Closing") shall be held at the
offices of Xxxxxxx, Xxxx & Xxxxx LLP, 000 Xxxxxxx Xxxxxx,
Xxxxxx, Xxxxxxxxxxxxx, on such date as may be mutually
agreed upon by Cubist and the Corporation; provided,
however, that, if Cubist and the Corporation are unable to
agree upon such date, then such date shall be designated by
Cubist, but Cubist may not designate a date earlier than the
thirtieth day following the date that the Exercise Notice is
given. Cubist and the Corporation, or, in the absence of
agreement as to the Acquisition Closing Date, Cubist alone,
shall give written notice to the Novalon Stockholders of the
* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
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Acquisition Closing Date. At the Acquisition Closing, the
parties shall take such actions as may be required in order
to consummate the Acquisition.
2.5. Stock Options. At the Acquisition Closing, if
any, each stock option of the Corporation that is
outstanding immediately prior thereto (each a "Novalon Stock
Option" and collectively, the "Novalon Stock Options") shall
be canceled, and Cubist shall grant to the holder thereof a
stock option under Cubist's Amended and Restated 1993 Stock
Option Plan (each such stock option granted by Cubist being
referred to herein as a "Substitute Stock Option" and,
collectively with all other stock options granted by Cubist
pursuant to this Section 2.5, the "Substitute Stock
Options") in substitution for such holder's canceled Novalon
Stock Option; provided, however, that in no event shall
Cubist be obligated to grant a Substitute Stock Option
pursuant to this Section 2.5 with respect to any Novalon
Stock Option that was not outstanding as of March 21, 1997.
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the intention of the parties that the Substitute Stock
Options be treated as non-qualified stock options for income
tax purposes. At the Acquisition Closing, Cubist shall
enter into a non-qualified stock option agreement with each
individual to whom Cubist must grant a Substitute Stock
Option pursuant to this Section 2.5, which non-qualified
stock option agreement shall evidence the terms of the
Substitute Stock Option to which it pertains and shall
otherwise be substantially in the form of Cubist's standard
form of non-qualified stock option agreement.
2.6. Common Stock Deemed Outstanding. For purposes of
Section 2.5 hereof, the number of shares of Novalon Common
Stock deemed outstanding immediately prior to the
Acquisition Closing shall be equal to (i) the number of
shares of Novalon Common Stock that are actually issued and
outstanding immediately prior to the Acquisition Closing,
plus (ii) the number of shares of Novalon Common Stock
issuable immediately prior to the Acquisition Closing upon
exercise, exchange or conversion of any security or
instrument exercisable or exchangeable for, or convertible
into, shares of Novalon Common Stock immediately prior to
the Acquisition Closing. Without limiting the generality of
the foregoing
* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
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provisions of this Section 2.6, the shares of Common Stock issuable
immediately prior to the Acquisition Closing upon conversion of any Preferred
Stock then issued and outstanding shall be included, for purposes of Section
2.5 above, among the number of shares of Novalon Common Stock deemed
outstanding immediately prior to the Acquisition Closing.
2.7. Accounting Treatment. The parties intend that the
Acquisition shall be treated as a pooling of interests for
accounting purposes.
2.8. Tax Treatment. The parties intend that the
Acquisition shall be treated as a reorganization for
purposes of Section 368 of the Code.
SECTION 3. REPRESENTATIONS AND WARRANTIES OF THE
CORPORATION AND THE NOVALON STOCKHOLDERS. The Corporation
and the Novalon Stockholders hereby jointly and severally
represent and warrant to Cubist that the representations and
warranties made by the Corporation in the Series B Stock
Purchase Agreement are true and correct, all to the same
extent as if such representations and warranties were set
forth in full herein.
SECTION 4. SPECIAL REPRESENTATIONS AND WARRANTIES OF
THE NOVALON STOCKHOLDERS. The Novalon Stockholders hereby
represent and warrant to Cubist as follows:
4.1. Due Authorization, Etc.
(a) Each Novalon Stockholder that is not a
natural person has obtained all necessary authorizations and
approvals from its Board of Directors and shareholders, or
Board of Trustees or other governing body, required for the
execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby. This
Agreement has been duly executed and delivered by each of
the Novalon Stockholders and constitutes the legal, valid
and binding obligation of each of the Novalon Stockholders
enforceable against each of the Novalon Stockholders in
accordance with its terms.
(b) The execution, delivery and performance of
this Agreement by each Novalon Stockholder and his, her, or
its participation in the consummation of the transactions
contemplated hereby are within such Novalon Stockholder's
full legal right, power and authority and do not contravene,
permit the termination of or constitute a default (or an
event which, with or without the giving of notice or the
passage of time, or both, will constitute a default) under
(i) the corporate charter and By-Laws, or other constituent
instruments, of any Novalon Stockholder that is not a
natural person, or (ii) any agreement or other instrument
binding upon such Novalon Stockholder, and will not result
in the creation or imposition of any lien, charge or
encumbrance in favor of any third party upon any of such
Novalon
* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
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Stockholder's assets or properties. The execution,
delivery and performance by the Novalon Stockholders of this
Agreement do not violate any provision of applicable law or
regulations or any judgment, injunction, award, decree or
order to which any such Novalon Stockholder is subject.
(c) None of the Novalon Stockholders has any
present plan or intention to sell or otherwise transfer the
shares of Cubist Common Stock to be received in connection
with the Acquisition.
4.2. Title to Stock. Schedule 4.2 hereto sets forth
the number of shares of Novalon Common Stock owned by each
Novalon Stockholder on the date hereof. Each Novalon
Stockholder owns of record and beneficially, and on the
Acquisition Closing Date will own of record and
beneficially, all right, title and interest in and to the
shares of Novalon Common Stock set forth opposite such
Novalon Stockholder's name on Schedule 4.2 hereto, free and
clear of all Encumbrances.
4.3. Ownership of Cubist Capital Stock. As of the
date hereof, none of the Corporation, the Novalon
Stockholders or their respective affiliates or associates
(as such terms are defined under the Exchange Act), (i)
beneficially own, directly or indirectly, or (ii) are
parties to any agreement, arrangement or understanding for
the purpose of acquiring, holding, voting or disposing of,
in each case, shares of capital stock of Cubist other than
as a result of this transaction.
4.4. Securities Act Matters.
(a) If and to the extent that the Acquisition is
consummated, each Novalon Stockholder will be acquiring the
shares of Cubist Common Stock to be issued to such
Stockholder pursuant to the Acquisition for such
Stockholder's account for investment and not with a view to
the distribution thereof. Each Novalon Stockholder
acknowledges that the Consideration Shares to be acquired by
such Novalon Stockholder in connection with the Acquisition
will not be registered under the Securities Act and,
therefore, such Consideration Shares must be held, and the
economic risk of the investment must be borne, indefinitely
unless and until such Consideration Shares are subsequently
registered under the Securities Act or an exemption from
such registration is available.
(b) Such Stockholder has received copies of
Cubist's Annual Report to Stockholders for 1997 and Cubist's
Annual Report on Form 10-K for its fiscal year ended
December 31, 1996 (the "SEC Material"). Cubist has made
available to each Novalon Stockholder or such
* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
8
Novalon Stockholder's purchaser representative, if any, the opportunity to
ask questions of, and receive answers from, Cubist or persons acting on its
behalf concerning the terms and conditions of the Acquisition and to obtain
any additional information that such Novalon Stockholder or such Novalon
Stockholder's purchaser representative may deem necessary to verify the
accuracy of the information contained in the SEC Material.
(c) Each Novalon Stockholder is an "accredited
investor" as defined in Rule 501 promulgated under the
Securities Act or meets the requirements of Section 4.4(d)
below.
(d) As indicated in Schedule 4.4 hereto, each
Novalon Stockholder either (i) has such knowledge and
experience in financial and business matters so that such
Stockholder is capable of evaluating the merits and risks of
an investment in Cubist, or (ii) has relied upon the advice
of such Novalon Stockholder's purchaser representative,
named in Schedule 4.4 hereto, with regard to the
considerations involved in making such investment, and such
purchaser representative and such Novalon Stockholder
together have such knowledge and experience in financial and
business matters so that such purchaser representative and
Novalon Stockholder are capable of evaluating the merits and
risks of such investment.
(e) At the Acquisition Closing, each Novalon
Stockholder shall enter into a Registration Rights
Agreement with Cubist, in form and substance reasonably
satisfactory to such Novalon Stockholder and Cubist,
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Novalon Stockholder hereby agrees that such Registration
Rights Agreement shall also provide that such Novalon
Stockholder shall not be entitled to exercise his, her or
its rights thereunder to the extent that any such exercise
would disqualify the Acquisition as a "pooling of interests"
for accounting purposes.
SECTION 5. CONDUCT OF BUSINESS PRIOR TO ACQUISITION
CLOSING DATE. The Corporation covenants and agrees that
(and the Stockholders covenant and agree that they will
cause the Corporation to), from and after the date of this
Agreement and until the earlier of (i) the Acquisition
Closing Date or (ii) the expiration date of the Acquisition
Option Period, except as otherwise specifically consented to
or approved by Cubist in writing:
5.1. Full Access. The Corporation shall afford to
Cubist and its authorized representatives full access during
normal business hours to all properties, books, records,
contracts and documents of the Corporation and its
Subsidiaries and a full opportunity to make such
investigations as Cubist or any of its authorized
representatives shall desire to make of the Corporation and
its Subsidiaries, and
* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
9
the Corporation shall furnish or cause to be furnished to Cubist and its
authorized representatives all such information with respect to the affairs
and businesses of Corporation and its Subsidiaries as Cubist may reasonably
request.
5.2. Carry on in Regular Course. The Corporation and
its Subsidiaries shall maintain their owned and leased
properties in good operating condition and repair,
reasonable wear and tear excepted, and to make all necessary
renewals, additions and replacements thereto. The
Corporation and its Subsidiaries shall carry on their
business diligently and substantially in the same manner as
heretofore and not make or institute any unusual or novel
methods of manufacture, purchase, sale, lease, management,
accounting or operation. The Corporation and its
Subsidiaries shall preserve all of their accounting and
business records, corporate records, trade secrets and
proprietary information for the benefit of Cubist.
5.3. No Dividends, Issuances, Repurchases, Etc. The
Corporation shall not declare or pay any dividends (whether
in cash, shares of stock, property or otherwise) on, or make
any other distribution (whether in cash, shares of stock,
property or otherwise) in respect of, any shares of its
capital stock, or authorize, sell, issue, purchase, redeem
or acquire for value any shares of its capital stock or any
options, warrants or rights to acquire any shares of its
capital stock.
5.4. No Increases. Neither the Corporation nor any of
its Subsidiaries shall increase the compensation payable or
to become payable to officers, employees or consultants, or
increase any bonus, insurance, pension or other benefit
plan, payment or arrangement made to, for or with any such
officers, employees or consultants.
5.5 Loans; Investments; Prepayments; Contingent
Liabilities. Neither the Corporation nor any of its
Subsidiaries shall borrow money from, or lend money to, any
Person. Neither the Corporation nor any of its Subsidiaries
shall make any investment in any Person. Neither the
Corporation nor any of its Subsidiaries shall guarantee,
indemnify or otherwise become contingently liable in any
way, or act as a surety with respect to, any debt, liability
or obligation of any Person.
5.6 Prepayments; Forgiveness of Debt. Neither the
Corporation nor any of its Subsidiaries shall (i) prepay any
of its debt obligations or otherwise accelerate payment of
any of its debt obligations or (ii) forgive any debt or
obligation owed to the Corporation or such Subsidiary.
5.7 Expenditures. Neither the Corporation nor any of
its Subsidiaries shall accrue, expend or commit, in any
single transaction or series of related transactions, any
amount in excess of $50,000 without the prior written
consent of Cubist.
* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
10
5.8 No Unauthorized Subsidiaries. Neither the
Corporation nor any of its Subsidiaries shall not acquire,
own or otherwise have or control any equity interest in any
corporation, partnership, limited liability company or any
other Person, without the prior written consent of Cubist.
5.9. Contracts, Commitments and Related Matters.
Neither Corporation nor any of its Subsidiaries shall enter
into any contract or commitment or engage in any transaction
not in the usual and ordinary course of business and
consistent with their normal business practices.
5.10. Sale, Exchange, Lease or License of Assets.
Neither Corporation nor any of its Subsidiaries shall sell,
exchange, license, lease or otherwise dispose of any asset
or properties without the prior written consent of Cubist.
Without limiting the generality of the foregoing, neither
the Corporation nor any of its Subsidiaries shall license
any of its intellectual property to any Person without the
prior written consent of Cubist.
5.11. Acquisitions of Assets. Except with the prior
written consent of Cubist, neither the Corporation nor any
of its Subsidiaries shall purchase, license, lease or
otherwise acquire any asset or properties, except for
acquisitions of inventory, supplies, tools, spare parts,
research equipment and supplies, laboratory equipment and
supplies and biological materials, in each case in the
ordinary course of business consistent with past practices.
Without limiting the generality of the foregoing, neither
the Corporation nor any of its Subsidiaries shall license
any of intellectual property from any Person without the
prior written consent of Cubist.
5.12. Preservation of Organization. The Corporation
shall use its best efforts to preserve the business
organization of Corporation and its Subsidiaries intact, to
keep available to Cubist the present officers and employees
of Corporation and its Subsidiaries and to preserve for
Cubist the present relationships with suppliers and
customers and others having business relations with the
Corporation or any of its Subsidiaries. The Corporation
shall not amend its Certificate of Incorporation or By-Laws,
except with the prior written consent of Cubist. Neither
the Corporation nor any of its Subsidiaries shall merge or
consolidate with any other Person, or acquire any stock or
securities of any other Person.
5.13. No Default. Neither the Corporation nor any of
its Subsidiaries shall do any act or omit to do any act, or
permit any act or omission to act, which will cause a
material breach of any contract, commitment or obligation of
the Corporation or any of its Subsidiaries.
5.14. Compliance with Laws. The Corporation and its
Subsidiaries shall duly comply in all material respects with
all laws, regulations and orders applicable with respect to
their business.
* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
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5.15. Title to Assets. The Corporation shall continue
to have good and valid record and marketable title to all of
its assets, free and clear of all Encumbrances.
5.16. Advice of Change. The Corporation shall
promptly advise Cubist in writing of any material adverse
change in the business, condition, operations, prospects or
assets of the Corporation and its Subsidiaries.
5.17. Consents of Third Parties. The Corporation
shall employ its best efforts to secure, before the
Acquisition Closing Date, the consent, in form and substance
satisfactory to Cubist and Cubist's counsel, to the
consummation of the transactions contemplated by this
Agreement by each party to any contract, commitment or
obligation of the Corporation or any of its Subsidiaries,
under which such transactions would constitute a default,
would accelerate, modify or vest obligations of the
Corporation or any of its Subsidiaries or would permit
cancellation of any such contract.
5.18. Transactions with Affiliates. Neither
Corporation nor any of its Subsidiaries will enter into any
transaction with any Affiliate.
SECTION 6. COVENANTS OF THE PARTIES.
6.1. *************************************************
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* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
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6.2. Novalon's Director of Business Development.
During the Acquisition Option Period, Cubist and the
Corporation shall consider and discuss whether to extend an
offer of employment to Xxxx Xxxxx, the Corporation's current
Director of Business Development. The parties hereby
acknowledge that the foregoing provisions of this Section
6.2 do not obligate Cubist to employ, or offer employment
to, Xxxx Xxxxx.
6.3. Location of Corporation's Operations. During the
Acquisition Option Period, Cubist and the Corporation shall
consider and discuss the advantages and disadvantages to
Cubist of keeping the businesses and operations of the
Corporation in the Chapel Hill, North Carolina area. If,
after such discussions, Cubist determines, in its sole
discretion, that it is in Cubist's best interests to
relocate the businesses and operations of the Corporation to
another location, Cubist shall be free to effect such
relocation at any time after the Acquisition Closing Date
upon providing adequate notice thereof.
6.4. Transfer of Stock; Title to Stock. During the
period commencing on the date hereof and ending on the
earlier of (x) the expiration date of the Acquisition Option
Period or (y) Acquisition Closing Date, each Novalon
Stockholder hereby covenants that:
(i) such Novalon Stockholder shall not sell,
convey, transfer, assign, pledge, encumber or otherwise
dispose of any shares of capital stock of the Corporation or
any interest therein; and
(ii) such Novalon Stockholder shall continue to
have good and valid record and marketable title to all of
the shares of capital stock of the Corporation owned by such
Novalon Stockholder on the date hereof, and all of such
shares shall continue to be free and clear of all
Encumbrances.
6.5. Pooling and Tax-Free Reorganization Treatment.
None of the Corporation, the Novalon Stockholders or Cubist
shall intentionally take or cause to be taken any action,
whether before or after the Acquisition Closing, which would
disqualify the Acquisition as a "pooling of interests" for
accounting purposes or as a "reorganization" within the
meaning of Section 368 of the Code.
6.6. No Solicitation. Unless and until the expiration
of the Acquisition Option Period, none of the Corporation,
its officers, directors, employees, representatives and
agents, including, but not limited to, investment bankers,
attorneys and accountants, or the Novalon Stockholders shall
(and the Novalon Stockholders will not permit the
Corporation to) directly or indirectly encourage, solicit,
initiate or participate in any discussions or negotiations
with, or provide any information to, any corporation,
partnership, person or other entity or group (other than
Cubist and its affiliates or representatives) concerning any
offer or proposal for
* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
13
any merger, tender offer, sale of substantial assets, sale of shares of
capital stock or debt securities or similar transaction involving the
Corporation (an "Acquisition Proposal"). The Corporation will immediately
communicate to Cubist the terms of any proposal, discussion, negotiation or
inquiry relating to an Acquisition Proposal and the identity of the party
making such proposal or inquiry which it may receive in respect of any such
transaction.
6.7. Public Announcements. Neither the Corporation
nor Cubist will distribute any news release or other public
information disclosure with respect to this Agreement or any
of the transactions contemplated hereby without the prior
consent of the other; provided, however, any such prior
consent shall not be required with respect to the
distribution of any such news release or other public
information disclosure to the extent such distribution is
required to satisfy either the Corporation's or Cubist's
obligations under applicable securities laws or is otherwise
required by law.
6.8. Standstill. If the Acquisition Closing occurs,
each Novalon Stockholder hereby covenants and agrees that,
so long as such Novalon Stockholder or any of its affiliates
(as such term is defined in the Exchange Act) owns of record
or beneficially (as such term is defined in the Exchange
Act) any of the Consideration Shares, neither such Novalon
Stockholder nor its affiliates shall, directly or
indirectly, unless authorized in writing by Cubist, in any
manner:
(i) acquire, offer or propose to acquire, solicit
an offer to sell or agree to acquire, directly or
indirectly, alone or in concert with others, by purchase or
otherwise, any direct or indirect beneficial interest in any
voting securities or direct or indirect rights, warrants or
options to acquire, or securities convertible into or
exchangeable for, any voting securities of Cubist;
(ii) make, or in any way participate in, directly
or indirectly, alone or in concert with others, any
"solicitation" of "proxies" to vote (as such terms are used
in the proxy rules of the Securities and Exchange Commission
promulgated pursuant to Section 14 of the Exchange Act) or
seek to advise or influence in any manner whatsoever any
person or entity with respect to the voting of any voting
securities of Cubist;
(iii) form, join or in any way participate in a
"group" within the meaning of Section 13(d)(3) of the
Exchange Act with respect to any voting securities of
Cubist;
(iv) acquire, offer to acquire or agree to
acquire, directly or indirectly, alone or in concert with
others, by purchase, exchange or otherwise, (A) any of the
assets, tangible or intangible, of Cubist or any of its
affiliates or (B) direct or indirect rights, warrants or
options to acquire any assets of Cubist or any of its
* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
14
affiliates, except for such assets as are then being offered for sale by
Cubist, or any of its affiliates;
(v) arrange, or in any way participate, directly
or indirectly, in any financing for the purchase of any
voting securities or securities convertible or exchangeable
into or exercisable for any voting securities or assets of
Cubist or any of its affiliates;
(vi) otherwise act, alone or in concert with
others, to seek to propose to Cubist or any of its
stockholders any merger, business combination,
restructuring, recapitalization or other transaction to or
with Cubist or otherwise see, alone or in concert with
others, to control, change or influence the management,
board of directors, or policies of Cubist or nominate any
person as a director who is not nominated by the then
incumbent directors, or propose any matter to be voted upon
by the stockholders of Cubist; or
(vii) take any action that might result in Cubist
having to make a public announcement regarding any of the
matters referred to in clauses (i) through (vi) of this
Section 6.8, or announce an intention to do, or enter into
any agreement or understanding or discussions with others to
do, any of the actions restricted or prohibited under such
clauses (i) through (vi).
6.9. Non-Competition. If the Acquisition Closing
occurs, each Novalon Stockholder hereby covenants and agrees
that, during the period commencing on the Acquisition
Closing Date and ending on the fifth anniversary of the
Acquisition Closing Date, such Novalon Stockholder shall
not, directly or indirectly:
(i) for its own account or as an employee,
officer, director, partner, joint venturer, shareholder,
investor, consultant or otherwise (except as an investor in
a corporation whose stock is publicly traded and in which
such Novalon Stockholder holds less than 2% of the
outstanding voting shares), engage in any business relating
to the research, discovery, development, sale, licensing,
marketing or other commercialization of (i) any of the
biological targets which Cubist is researching, developing,
otherwise actively pursuing, selling, marketing or otherwise
commercializing at the time of the Acquisition Closing (the
"Cubist Biological Targets") or (ii) anti-bacterial and/or
anti-fungal drugs whose principal mechanism of action is the
inhibition of any Cubist Biological Target;
(ii) solicit the employment of any employee of
Cubist, the Corporation or any of their respective
Subsidiaries; or
(iii) interfere with any business relationship
between Cubist, the Corporation or any other of their
respective Subsidiaries, on the one hand, with any
* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
15
Person (including, without limitation, any licensor, licensee, collaborator,
corporate partner, supplier or customer), on the other hand.
At the Acquisition Closing, Cubist shall deliver to the
Corporation and Xxxx X. Xxxxxxx a list of the Cubist
Biological Targets and Xx. Xxxxxxx shall, promptly
thereafter, send a copy of such list to each of the other
Novalon Stockholders.
SECTION 7. CONDITIONS PRECEDENT TO CUBIST'S
OBLIGATIONS. Notwithstanding Cubist's exercise of the
Acquisition Option pursuant to, and in accordance with, the
provisions of Section 2.1 hereof, Cubist shall be obligated
to consummate the Acquisition only if each of the following
conditions is satisfied at or prior to the Acquisition
Closing Date, unless any such condition is waived in writing
by Cubist:
7.1. Accuracy of Representations and Warranties by the
Corporation and the Novalon Stockholders. The
representations and warranties of the Corporation and the
Novalon Stockholders set forth in Sections 3 and 4 hereof
shall be true and correct in all material respects as of the
Acquisition Closing Date with the same force and effect as
though made again at and as of the Acquisition Closing Date,
except for changes permitted or required by this Agreement.
7.2. Compliance by the Corporation and the Novalon
Stockholders. The Corporation and the Novalon Stockholders
shall have performed and complied in all material respects
with all covenants and agreements contained in this
Agreement required to be performed or complied with by them
on or before the Acquisition Closing Date.
7.3. No Material Change. Since December 31, 1996
there shall not have been or threatened to be any material
damage to or loss or destruction of any properties or assets
owned or leased by the Corporation or any of its
Subsidiaries (whether or not covered by insurance) or any
material adverse change in the condition (financial or
otherwise), operations, business or assets of the
Corporation and its Subsidiaries taken as a whole or
imposition of any laws, rules or regulations which would
materially adversely affect the condition (financial or
otherwise), operations, business or assets of the
Corporation and its Subsidiaries taken as a whole.
7.4. Officers' Closing Certificate. The Corporation
shall have executed and delivered to Cubist at and as of the
Acquisition Closing a certificate, duly executed by the
Corporation's President, in form and substance satisfactory
to Cubist and Cubist's counsel, certifying that the
conditions specified in each of Section 7.1, 7.2 and 7.3
have been satisfied.
* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
16
7.5. Definitive Acquisition Agreement. Each of
Cubist, the Corporation and the Novalon Stockholders shall
have executed and delivered to each other counterparts of
the Definitive Acquisition Agreement.
7.6. UNC License Agreement. Each of the Corporation
and UNC shall have executed and delivered to the other
counterparts of a license agreement with respect to the U.S.
patent application entitled "Electrochemical Probes for
Detection of Molecular Interactions and Drug Discovery" and
any continuations and divisions derived therefrom, and such
license agreement shall be in form and substance
satisfactory to Cubist and shall be in full force and effect
prior to and immediately after the Acquisition Closing.
7.7. Invention Assignments. The Corporation shall
have made available to Cubist such invention assignments
requested by Cubist with respect to the U.S. patent
application entitled "Identification of Drugs Using
Complementary Combinatorial Libraries", and such invention
assignments shall be in form and substance satisfactory to
Cubist.
7.8. Employment and Non-Competition Agreement with
Xxxx Xxxxxxx. Xxxx Xxxxxxx and the Corporation shall have
terminated Xx. Xxxxxxx employment agreement with the
Corporation, and Xx. Xxxxxxx shall have executed and
delivered to Cubist an employment and non-competition
agreement (the "Xxxxxxx Employment Agreement"), pursuant to
which Xx. Xxxxxxx shall become a Vice President of Cubist
from and after the Acquisition Closing upon such terms and
conditions (including, without limitation, base salary and
fringe benefits) as Cubist and Xx. Xxxxxxx shall have
mutually agreed upon as reflected in the Xxxxxxx Employment
Agreement; provided, however, that in no event shall the
base salary and fringe benefits of Xx. Xxxxxxx under the
Xxxxxxx Employment Agreement be less than the base salary
and fringe benefits of Xx. Xxxxxxx under his employment
agreement with the Corporation, as in effect on March 21,
1997.
7.9. Employment Matters.
(a) Each of the scientific employees of the
Corporation shall have agreed to become employees of Cubist
upon the same terms of employment as were in effect for such
scientific employees on March 21, 1997; provided, however,
that the terms of such scientific employees' employment with
Cubist may require that such scientific employees relocate.
(b) Each of the scientific employees of the
Corporation shall have executed and delivered to Cubist a
counterpart of Cubist's standard form of Proprietary
Information and Inventions Agreement, a copy of which is
attached to this Agreement as Exhibit A hereto.
* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
17
7.10. Consulting Agreements.
(a) The Corporation and each of its consultants shall
have terminated such consultant's consulting relationship
with the Corporation, and such consultant shall have entered
into a consulting agreement with Cubist for a term equal to
the balance of the term of such consultant's consulting
agreement with the Corporation and upon such other terms
(including, without limitation, consulting effort and
consideration) as were included in such consultant's
consulting agreement with the Corporation, as in effect on
March 21, 1997.
(b) Each of the consultants of the Corporation shall
have executed and delivered to Cubist a counterpart of
Cubist's standard form of Proprietary Information and
Inventions Agreement, a copy of which is attached to this
Agreement as Exhibit A hereto.
7.11. Scientific Advisory Board. Each of Xxxxxx
Xxxxx, Xxxxxx Xxxxx and Xxxxx Xxx shall have agreed to
become members of Cubist's Scientific Advisory Board.
7.12. No Injunctions or Restraints. No temporary
restraining order, preliminary or permanent injunction or
other order issued by any court of competent jurisdiction or
other legal restraint or prohibition preventing the
consummation of the Acquisition shall be in effect.
7.13. Opinion of the Corporation's Counsel. The
Corporation shall have delivered to Cubist the opinion of
Jenner & Block, counsel to the Corporation and the Novalon
Stockholders, dated the Acquisition Closing Date and in form
and substance reasonably satisfactory to Cubist and Cubist's
counsel.
7.14. Accounting Treatment. Cubist shall have
received letters from Coopers & Xxxxxxx L.L.P. (on behalf of
Cubist) and Ernst & Young L.L.P. (on behalf of the
Corporation and the Novalon Stockholders), dated the date of
the Acquisition Closing, substantially to the effect that,
on the basis of a review of this Agreement and the
transactions contemplated hereby, in such accountants'
opinion Accounting Principles Board Opinion No. 16 requires
that the Acquisition be accounted for as a pooling of
interests.
7.15. Tax Opinion. Cubist shall have received a legal
opinion from Xxxxxxx, Xxxx & Xxxxx LLP, counsel to Cubist,
to the effect that, on the basis of the facts and
representations set forth therein, or set forth in writing
elsewhere and referred to therein, for federal income tax
purposes the Acquisition constitutes a reorganization under
Section 368 of the Code. In rendering any such opinions,
such counsel may rely, to the extent it deems necessary or
appropriate, upon opinions of
* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
18
other counsel and upon representations of an officer or officers of Cubist
and the Corporation or any of their affiliates.
7.16. Due Diligence. Cubist shall have completed its
due diligence review of the Corporation and its assets,
properties, contractual obligations, intellectual property
position, business and operations, and the results of such
due diligence review shall be satisfactory to Cubist in its
reasonable discretion.
7.17. Proceedings and Documents Satisfactory. All
proceedings in connection with the Acquisition and the other
transactions contemplated by this Agreement and all
certificates and documents delivered to Cubist pursuant to
this Section 7 shall be reasonably satisfactory to Cubist
and its counsel.
SECTION 8. CONDITIONS PRECEDENT TO THE CORPORATION'S
AND THE NOVALON STOCKHOLDERS' OBLIGATIONS. Notwithstanding
Cubist's exercise of the Acquisition Option pursuant to, and
in accordance with, the provisions of Section 2.1 hereof,
the Corporation and the Novalon Stockholders shall be
obligated to consummate the Acquisition only if each of the
following conditions is satisfied at or prior to the
Acquisition Closing Date, unless any such condition is
waived in writing by the Corporation:
8.1. Compliance by Cubist. Cubist shall have
performed and complied in all material respects with all of
the covenants and agreements required to be performed or
complied with by it on or before the Acquisition Closing
Date.
8.2. Officers' Certificate. Cubist shall have
delivered to the Corporation a certificate of its President,
dated the Acquisition Closing Date, stating that the
conditions set forth in Section 8.1 have been satisfied.
8.3. Employment and Non-Competition Agreement with
Xxxx Xxxxxxx. Cubist shall have executed and delivered to
Xxxx Xxxxxxx a counterpart of the Xxxxxxx Employment
Agreement, pursuant to which Xx. Xxxxxxx shall become a Vice
President of Cubist from and after the Acquisition Closing
upon such terms and conditions (including, without
limitation, base salary and fringe benefits) as Cubist and
Xx. Xxxxxxx shall have mutually agreed upon as reflected in
the Xxxxxxx Employment Agreement; provided, however, that in
no event shall the base salary and fringe benefits of Xx.
Xxxxxxx under the Xxxxxxx Employment Agreement be less than
the base salary and fringe benefits of Xx. Xxxxxxx under his
employment agreement with the Corporation, as in effect on
March 21, 1997.
8.4. Employment Matters. Cubist shall have offered
employment to each of the scientific employees of the
Corporation upon the same terms of employment as were
applicable to such scientific employees during their
employment by the
* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
19
Corporation; provided, however, that the terms of such scientific employees
employment with Cubist may require that such scientific employees relocate.
8.5. Consulting Agreements. Cubist shall have
executed and delivered to each of the Corporation's
consultants a consulting agreement with a term equal to the
balance of the term of such consultant's consulting
agreement with the Corporation and upon such other terms
(including, without limitation, consulting effort and
consideration) as were included in such consultant's
consulting agreement with the Corporation, as in effect on
March 21, 1997.
8.7. Scientific Advisory Board. Each of Xxxxxx Xxxxx,
Xxxxxx Xxxxx and Xxxxx Xxx shall have been appointed as
members of Cubist's Scientific Advisory Board.
8.8. No Injunctions or Restraints. No temporary
restraining order, preliminary or permanent injunction or
other order issued by any court of competent jurisdiction or
other legal restraint or prohibition preventing the
consummation of the Acquisition shall be in effect.
8.9. Opinion of Cubist's Counsel. Cubist shall have
delivered to the Novalon Stockholders the opinion of
Xxxxxxx, Xxxx & Xxxxx LLP, counsel to Cubist, dated the
Acquisition Closing Date and in form and substance
reasonably satisfactory to the Novalon Stockholder and their
counsel.
8.10. Tax Opinion. The Novalon Stockholders shall
have received a legal opinion from Jenner & Block, counsel
to the Novalon Stockholders, to the effect that, on the
basis of the facts and representations set forth therein, or
set forth in writing elsewhere and referred to therein, for
federal income tax purposes the Acquisition constitutes a
reorganization under Section 368 of the Code. In rendering
any such opinions, such counsel may rely, to the extent it
deems necessary or appropriate, upon opinions of other
counsel and upon representations of an officer or officers
of Cubist and the Corporation or any of their affiliates.
8.11. Proceedings and Documents Satisfactory. All
proceedings in connection with the Acquisition and the other
transactions contemplated by this Agreement and all
certificates and documents delivered to the Corporation and
the Novalon Stockholders pursuant to this Section 8 shall be
reasonably satisfactory to the Corporation, the Novalon
Stockholders and their counsel.
SECTION 9. CONFIDENTIAL INFORMATION. Any and all
non-public information disclosed by Cubist to Corporation or
by Corporation to Cubist as a result of the negotiations
leading to the execution of this Agreement, or in
furtherance hereof, shall remain subject to the terms of the
Confidential Non-
* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
20
Disclosure Agreement dated March 12, 1997
executed and delivered to each other by Cubist and the
Corporation (the "Confidentiality Agreement").
SECTION 10. SURVIVAL OF REPRESENTATIONS. Each of the
representations and warranties in this Agreement made by the
Corporation or any of the Novalon Stockholders shall survive
the Acquisition Closing and shall expire on the third
anniversary of the Acquisition Closing Date.
SECTION 11. TAX CONSEQUENCES TO THE PARTIES. Cubist,
on the one hand, and the Corporation and the Novalon
Stockholders, on the other, understand and agree that
neither Cubist, on the one hand, nor the Corporation or the
Novalon Stockholders, on the other, are making any
representation or warranty as to the tax consequences of
this Agreement and the events and actions contemplated
hereby. Nonetheless, if the Acquisition Closing occurs all
parties hereto agree to report the Acquisition on their
respective federal income tax returns as a tax-free
reorganization under Section 368 of the Code.
SECTION 12. TERMINATION; LIABILITIES CONSEQUENT
THEREON. This Agreement may be terminated and the
Acquisition abandoned at any time prior to the Acquisition
Closing only as follows:
(a) by Cubist, upon notice to the Corporation at
any time prior to the exercise of the Acquisition Option; or
(b) by Cubist or the Corporation, upon notice to
the other at any time after the expiration of the
Acquisition Option Period if Cubist did not timely exercise
the Acquisition Option pursuant to, and in accordance with,
the provisions of Section 2.1 hereof; or
(c) by Cubist, upon notice to the Corporation if
the conditions set forth in Section 7 shall not have been
satisfied within ninety (90) days following Cubist's
exercise of the Acquisition Option pursuant to, and in
accordance with, the provisions of Section 2.1 hereof; or
(d) by the Corporation, upon notice to Cubist if
the conditions set forth in Section 8 shall not have been
satisfied within ninety (90) days following Cubist's
exercise of the Acquisition Option pursuant to, and in
accordance with, the provisions of Section 2.1 hereof; or
(e) at any time by mutual agreement of Cubist and
the Corporation; or
(f) by Cubist, if there has been any material
breach of any representation, warranty or covenant of the
Corporation or the Novalon
* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
21
Stockholders contained herein and the same has not been cured within 30 days
after notice thereof; or
(g) by the Corporation, if there has been any
material breach of any covenant of Cubist contained herein
and the same has not been cured within 30 days after notice
thereof.
Any termination pursuant to this Section 12 shall be without
liability on the part of any party, unless such termination
is the result of a material breach of this Agreement by a
party to this Agreement in which case such breaching party
shall remain liable for such breach notwithstanding any
termination of this Agreement. The Confidentiality
Agreement shall survive any termination of this Agreement.
SECTION 13. GENERAL.
13.1 Expenses. Each party hereto will pay its own
expenses in connection with the transactions contemplated
hereby, whether or not such transactions shall be
consummated
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13.2. Assignment and Benefits of Agreement. This
Agreement shall be binding upon and shall inure to the
benefit of the parties and their respective successors, but
may not be assigned by any of the parties without the
written consent of the others. Except as aforesaid or as
specifically provided for elsewhere in this Agreement,
nothing in this Agreement, express or implied, is intended
to confer upon any person other than the parties hereto and
their said successors and permitted assigns, any rights
under or by reason of this Agreement.
13.3 Remedies. In case that any one or more of the
covenants and/or agreements set forth in this Agreement
shall have been breached by any party hereto, the party or
parties entitled to the benefit of such covenants or
agreements may proceed to protect and enforce its or their
rights, either by suit in equity and/or
* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
22
action at law, including, but not limited to, an action for damages as a
result of any such breach and/or an action for specific performance of any
such covenant or agreement contained in this Agreement. The rights, powers
and remedies of the parties to this Agreement are cumulative and not
exclusive of any other right, power or remedy which such parties may have
under any other agreement or law. No single or partial assertion or exercise
of any right, power or remedy of a party hereunder shall preclude any other
or further assertion or exercise thereof.
13.4 Entire Agreement. Except as specifically
otherwise provided for elsewhere in this Agreement, this
Agreement contains the entire agreement among the parties
with respect to the subject matter hereof and supersedes all
prior and contemporaneous arrangements or understandings
with respect thereto.
13.5 Notices. All notices, requests, consents and
other communications hereunder to any party shall be deemed
to be sufficient if contained in a written instrument
delivered in person or duly sent by first class, registered,
certified or overnight mail, postage prepaid, or telecopied
with a confirmation copy by regular mail, addressed or
telecopied, as the case may be, to such party at the address
or telecopier number, as the case may be, set forth below or
such other address or telecopier number, as the case may be,
as may hereafter be designated in writing by the addressee
to the addressor listing all parties:
(i) If to the Corporation, to:
Novalon Pharmaceutical Corporation
000 Xxxx Xxxxxxx Xxxxxx, Xxxxx X
Xxxxxx Xxxx, X.X. 00000
Attention: Xxxx X. Xxxxxxx, M.D., Ph.D.,
President & CEO
Telecopier:(000) 000-0000
with a copy to:
Jenner & Block
12th Floor
000 Xxxxxxxxxx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
Attention: D. Xxx Xxxxx, Esq.
Telecopier: (000) 000-0000
(ii) If to Cubist, to:
Cubist Pharmaceuticals, Inc.
00 Xxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxxx, Ph.D.
* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
23
Telecopier: (000) 000-0000
with a copy to:
Xxxxxxx, Xxxx & Xxxxx LLP
000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000-0000
Attention: Xxxxx X. Xxxx, Esquire
Telecopier:(000) 000-0000
(iii) If to any Novalon Stockholder, to
c/o Novalon Pharmaceutical Corporation
000 Xxxx Xxxxxxx Xxxxxx, Xxxxx X
Xxxxxx Xxxx, X.X. 00000
Attention: Xxxx X. Xxxxxxx, M.D., Ph.D.,
President & CEO
Telecopier:(000) 000-0000
with a copy to:
Jenner & Block
12th Floor
000 Xxxxxxxxxx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
Attention: D. Xxx Xxxxx, Esq.
Telecopier: (000) 000-0000
Any notice or other communication pursuant to this Agreement
shall be deemed to have been duly given or made and to have
become effective (i) when delivered in hand to the party to
which it was directed, (ii) if sent by telex, telecopier,
facsimile machine or telegraph and properly addressed in
accordance with the foregoing provisions of this Section
13.5, when received by the addressee, (iii) if sent by
commercial courier guaranteeing next business day delivery,
on the business day following the date of delivery to such
courier, or (iii) if sent by first-class mail, postage
prepaid, and properly addressed in accordance with the
foregoing provisions of this Section 13.5, (A) when received
by the addressee, or (B) on the third business day following
the day of dispatch thereof, whichever of (A) or (B) shall
be the earlier.
13.6 Amendments and Waivers. Any provision of this
Agreement may be amended, modified or terminated, and the
observance of any provision of this Agreement may be waived
(either generally or in a particular instance and either
* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
24
retrospectively or prospectively), with, but only with, the
written consent of each of the parties hereto.
13.7 Severability. Any provision of this Agreement
that is prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent
of such prohibition or unenforceability without invalidating
the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other
jurisdiction.
13.8 No Waiver of Future Breach. No failure or delay
on the part of any party to this Agreement in exercising any
right, power or remedy hereunder shall operate as a waiver
thereof. No assent, express or implied, by any party hereto
to any breach in or default of any agreement or condition
herein contained on the part of any other party hereto shall
constitute a waiver of or assent to any succeeding breach in
or default of the same or any other agreement or condition
hereof by such other party.
13.9 Attorneys' Fees. If any party to this Agreement
brings an action to enforce its rights under this Agreement
and such party is the prevailing party, then such party
shall be entitled to recover its costs and expenses,
including, without limitation, reasonable attorneys' fees,
incurred in connection with such action, including any
appeal of such action. The amount of such costs and
expenses to which such party shall be entitled shall be
determined and set by the judge and not a jury.
13.10 Headings. The headings of the various
sections of this Agreement have been inserted for
convenience of reference only and shall not be deemed to be
a part of this Agreement.
13.11 Nouns and Pronouns. Whenever the context may
require, any pronouns used herein shall include the
corresponding masculine, feminine or neuter forms, and the
singular form of names and pronouns shall include the plural
and vice-versa.
13.12 Governing Law. This Agreement shall be
governed by and construed in accordance with the laws of the
State of Delaware, excluding choice of law rules thereof.
13.13 Counterparts. This Agreement may be executed
in any number of counterparts, and each such counterpart
shall be deemed to be an original instrument, but all such
counterparts together shall constitute but one agreement.
* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
25
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* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
26
IN WITNESS WHEREOF, the parties hereto have executed
this Agreement as of the date first above written.
CORPORATION:
NOVALON PHARMACEUTICAL
CORPORATION
By: [signature appears here]
--------------------------------------------
Name: Xxxx X. Xxxxxxx, M.D., Ph.D.
Title: President & CEO
CUBIST:
CUBIST PHARMACEUTICALS, INC.
By: [signature appears here]
--------------------------------------------
Xxxxx X. Xxxxxxxx, President
NOVALON STOCKHOLDERS:
[signature appears here]
--------------------------------------------
Xxxx X. Xxxxxxx
[signature appears here]
--------------------------------------------
Xxxxx X. Xxxx
[signature appears here]
--------------------------------------------
Xxxxxx X. Xxxxx
* Confidential treatment requested: material has been omitted and filed
separately with the Commission.
27
