Exhibit 99.1
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SETTLEMENT AGREEMENT
This SETTLEMENT AGREEMENT (the "Agreement") is made and entered into as of
November 10, 2006, by and between Nabi Biopharmaceuticals, a Delaware
corporation ("Nabi"), and Third Point LLC, a Delaware limited liability company
("Third Point").
RECITALS
WHEREAS, Third Point intends to solicit written consents from Nabi's
stockholders (the "Solicitation") to (i) remove a majority of the members of
Nabi's board of directors (the "Board") and (ii) request that the Board fill the
resulting vacancies on the Board with nominees selected by Third Point; and
WHEREAS, among other things, Nabi is willing to add to the Board certain
individuals selected by Third Point and to create a Strategic Action Committee
of the Board (the "SAC"), and Third Point is willing to terminate the
Solicitation;
NOW, THEREFORE, in consideration of the premises, the mutual covenants and
agreements contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
ARTICLE I.
AGREEMENTS
Section 1.1. Board Composition Matters; Nominations at 2007 Stockholder
Meeting.
(a) Nabi shall as promptly as practicable, and in any event within one
business day after the date hereof, take all action necessary (including the
calling of a special meeting of the Board to approve such actions) to:
(i) expand the size of the Board so as to create two new directorships
on the Board in accordance with Article Fifth of its Restated Certificate of
Incorporation and Article III of its By-Laws, and
(ii) appoint Xxxxx Xxxxx and Xxxxxxx Xxxxx (collectively, the "Third
Point Nominees") to fill such newly-created directorships.
(b) At the annual meeting of stockholders of Nabi to be held in 2007 (the
"2007 Annual Meeting"), Nabi shall nominate the Third Point Nominees as
directors for a term commencing from the close of the 2007 Annual Meeting and
shall include the Third Point Nominees on the Board's proposed slate of nominees
for election at the 2007 Annual Meeting. Prior to the 2007 Annual Meeting, Nabi
shall solicit proxies for the election of the Board's slate of nominees
(including the Third Point Nominees) at the 2007 Annual Meeting.
(c) Should any Third Point Nominee resign from the Board prior to the
annual meeting of stockholders of Nabi to be held in 2008, or decide not to seek
appointment or election to the Board at the 2007 Annual Meeting, Third Point
shall, with the consent of Nabi (which
consent shall not be unreasonably withheld or delayed), be entitled to designate
a reasonably qualified replacement for such Third Point Nominee as a member of
the Board and as a member of the SAC, and Nabi shall take all necessary action
to implement the foregoing as promptly as practicable. Any such designated
replacement who becomes a Board member shall be deemed to be a Third Point
Nominee for all purposes under this Agreement.
Section 1.2. Strategic Alternatives Process. (a) Nabi agrees to form the
SAC as a committee of the Board with the full power and authority of the Board,
subject only to the limitations on power and authority contained in Section
141(c) of the Delaware General Corporation Law, (i) to actively explore and
consider for recommendation to the Board strategic alternatives for Nabi,
including (A) asset acquisitions or sales, joint ventures, strategic alliances
and licensing and development agreements, in each case involving the expenditure
or receipt by Nabi of more than $10 million, (B) a recapitalization, and (C) the
merger or sale of all or substantially all assets of Nabi (each of the
transactions described in the foregoing clauses (A), (B) and (C) is referred to
as a "Strategic Transaction") and (ii) to review and consider for recommendation
to the Board any clinical trial to be conducted by Nabi involving the net
expenditure by Nabi (after taking into consideration any reimbursement by a
third party) of more than $10 million other than any clinical trial that is
currently being conducted by Nabi or that Nabi is obligated to conduct under any
agreement with a third party (each, a "Qualified Expenditure"). The Board shall
not approve any Strategic Transaction or Qualified Expenditure without the
recommendation of a majority of the members of the SAC. Subject to the
foregoing, the full Board (and not the SAC) shall have the sole power to approve
any such Strategic Transaction or Qualified Expenditure.
(b) The SAC shall be comprised of five members, two of whom shall be the
Third Point Nominees. The remaining three members of the SAC shall be current
Board members, other than the Management Director, one of whom (the "Company
Designee") shall be designated by the Board within one business day after the
date of this Agreement and two of whom (each of the two, a "Designated Board
Member") shall be designated by the Third Point Nominees within five business
days of the date of this Agreement. If the Company Designee shall resign from
the SAC, or become unable to serve thereon, the Board shall designate a
successor, other than the Management Director, to fill the vacancy on the SAC
created by such resignation or inability to serve thereon. If one or both of the
Designated Board Members declines to serve on, or resigns from, the SAC, or
becomes unable to serve thereon, the Third Point Nominees shall designate a
successor or successors to any such Designated Board Member, which successor or
successors shall be chosen from among the members of the Board, other than the
Management Director. If the Third Point Nominees are required to designate a
successor to any Designated Board Member or Designated Board Members and if all
members of the Board, other than the Management Director, shall have declined to
be designated by the Third Point Nominees as such Designated Board Member, or
shall have resigned from the SAC or shall be unable to serve thereon, then the
Third Point Nominees, the Company Designee and any Designated Board Member
remaining on the SAC who has not resigned therefrom and who is able to serve
thereon (the "Remaining Members") shall promptly seek in good faith to identify
and agree upon (by majority vote of the Remaining Members) an independent third
party or parties (each, an "Independent Member") to replace the Designated Board
Member or Designated Board Members who declined to serve on, or resigned from,
the SAC or was or were
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unable to serve thereon. If the Remaining Members are able to identify and agree
upon (by majority vote of the Remaining Members) an Independent Member or
Independent Members, as the case may be, they shall so advise the Board and the
Board shall promptly add the Independent Member or Independent Members, as the
case may be, to the Board and to the SAC. Pending the agreement of the Remaining
Board Members to one or two Independent Members, as the case may be, the SAC
shall be deemed to be duly constituted and shall operate in all respects as a
committee of the Board as contemplated by Section 1.2(a). "Management Director"
shall mean any member of the current Board who, as of the date hereof, is also
an executive officer of Nabi.
(c) The five members of the SAC, once they have been all appointed to the
SAC, shall (by majority vote thereof) appoint one of the Third Point Nominees to
serve as Chairman of the SAC. The Chairman of the SAC shall preside at all
meetings of the SAC, shall be the principal liaison of the SAC with its
financial, legal and other advisors and shall generally serve with respect to
the SAC in a manner comparable to the manner in which the Chairman of the Board
and/or Nabi's lead director serves with respect to the Board. All significant
directions to Nabi's financial and other advisors and all other significant
actions and decisions of the SAC shall be considered and approved by the SAC.
All meetings of the SAC shall be held at reasonable times and at reasonable
places, and members of the SAC shall be entitled to participate in meetings
telephonically.
(d) Nabi represents and warrants to Third Point that each member of the
Board other than the Management Director has been asked about his or her
willingness to serve on the SAC, and each such member of the Board has advised
Nabi that he or she will serve on the SAC if requested to do so by the Third
Point Nominees.
(e) The Company Designee and/or one or more of the Designated Board Members
shall communicate to the Board all actions taken by the SAC and any significant
communications with any advisor by the SAC as promptly as practicable.
(f) Third Point represents and warrants to Nabi that each Third Point
Nominee has been asked about his willingness to serve on the Board and the SAC
(including as Chairman of the SAC), and each such Third Point Nominee has
advised Third Point that he will serve on the Board and the SAC and, if
requested by the SAC, as Chairman of the SAC.
(g) At any time after the completion of the annual meeting of stockholders
of Nabi to be held in 2008, the Board may in its sole discretion dissolve the
SAC, and upon such dissolution the provisions of this Section 1.2 and Section
1.3 hereof shall terminate.
Section 1.3. Right to Detailed Updates. At Third Point's option, Third
Point shall have the right from time to time to be updated in detail by the
Third Point Nominees, the SAC and its financial advisors as to any and all
matters within the power and authority of the SAC. Third Point agrees to keep
all such information it may receive confidential and shall not disclose such
information to any third party other than its employees and legal counsel who
have a need to know such information, provided such employees and legal counsel
agree to keep such information confidential and not disclose the same. Third
Point shall be responsible for any
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disclosure by its employees and legal counsel of any such information.
Notwithstanding the foregoing, Third Point, and its employees and legal counsel
to whom it discloses information such shall not be required to keep confidential
any such information (i) that is made public by Nabi or any other person who is
not known to Third Point to be subject to a confidentiality obligation to Nabi
or (ii) that Third Point has developed on its own prior to receiving such
information from a Third Point Nominee, the SAC, Nabi or any of their respective
financial advisors. Third Point acknowledges that it is aware that the United
States securities laws prohibit any person who has material nonpublic
information about a company from purchasing or selling securities of such
company, or from communicating such information to any other person under
circumstances in which it is reasonably foreseeable that such person is likely
to purchase or sell such securities.
Section 1.5. Annual Meeting. Nabi shall hold the 2007 Annual Meeting no
later than May 31, 2007, and shall give notice of the date of that meeting no
later than 120 days prior to the 2007 Annual Meeting.
Section 1.6. Termination of Solicitation; Voting Agreement. (a) From the
date hereof through the completion of the 2007 Annual Meeting, neither Third
Point nor any of its Affiliates will, directly or indirectly, solicit proxies or
consents for the voting of any voting or other securities of Nabi or otherwise
become a "participant," directly or indirectly, in any "solicitation" of
"proxies" or consents to vote, or become a "participant" in any "election
contest" involving Nabi or Nabi's securities (all terms used herein and defined
in Regulation 14A under the Exchange Act of 1934, as amended (the "Exchange
Act") having the meanings assigned to them therein), (ii) seek to advise or
influence any person with respect to the voting of any securities of Nabi, (iii)
initiate, propose or otherwise "solicit" Nabi stockholders for the approval of
shareholder proposals, (iv) otherwise communicate with Nabi's stockholders or
others pursuant to Rule 14a-1(l)(2)(iv) under the Exchange Act, (v) otherwise
engage in any course of conduct with the purpose of causing stockholders of Nabi
to vote contrary to the recommendation of the Board on any matter presented to
Nabi's stockholders for their vote or challenging the policies of Nabi or (vi)
otherwise act, directly or indirectly, alone or in concert with others, to seek
to control or influence the management, the Board, policies or affairs of Nabi,
other than through the Third Point Nominees. For purposes of this Agreement,
"Affiliate" means, with respect to any person, any other person that directly,
or indirectly through one or more intermediaries, controls, is controlled by, or
is under common control with, such first person and any employees, officers and
partners of Third Point.
(b) Until the completion of the 2007 Annual Meeting,
(i) at each meeting of stockholders of Nabi held for the purpose of
electing any member of the Board, Third Point shall, and shall cause its
Affiliates to, cause all voting securities of Nabi beneficially owned by each of
them to be present at such meeting for purposes of establishing a quorum and to
be voted (x) for the nominees recommended by the Board (provided such nominees
include the Third Point Nominees), (y) on all other proposals of the Board and
any proposals by other stockholders of Nabi not covered by clause (z) below, as
Third Point determines is appropriate, and (z) in accordance with the
recommendation of the Board on any proposals of any other stockholder of Nabi
who is also proposing one or more nominees for
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election as director in opposition to the nominees of the Board at any such
meeting. No later than five business days prior to each such meeting of
stockholders, Third Point shall, and shall cause each of its Affiliates to, vote
in accordance with this Section 1.6(b). Third Point shall not, and shall cause
each of its Affiliates not to, revoke or change any vote in connection with any
such meeting of stockholders unless such revocation or change is required or
permitted in accordance with the first sentence of this Section 1.6(b); and
(ii) Third Point shall not, and shall cause its Affiliates not to,
execute any written consent to approve any proposal by any other stockholder of
Nabi (including a proposal for the removal and/or election of new members of the
Board) that has not been recommended by the Board.
Section 1.7. Expenses. Nabi shall pay for all out-of-pocket costs and
expenses incurred by Third Point and its Affiliates in connection with their
efforts to induce Nabi to pursue strategic alternatives and in connection with
the Solicitation, including without limitation legal fees and the fees of the
proxy solicitor retained by Third Point and its affiliates. To the extent Third
Point or its Affiliates have already paid any such expenses, Nabi shall promptly
reimburse them for such payments. In no event shall the costs and expenses to be
paid or reimbursed by Nabi pursuant to this Section 1.7 exceed $250,000.
ARTICLE II.
MISCELLANEOUS PROVISIONS
Section 2.1. Representations and Warranties.
(a) Each of the parties hereto represents and warrants to the other party
that:
(i) such party has all requisite authority and power to execute and
deliver this Agreement and to consummate the transactions contemplated
hereby,
(ii) the execution and delivery of this Agreement and the consummation
of the transactions contemplated hereby have been duly and validly
authorized by all required action on the part of such party and no other
proceedings on the part of such party are necessary to authorize the
execution and delivery of this Agreement or to consummate the transactions
contemplated hereby,
(iii) the Agreement has been duly and validly executed and delivered
by such party and constitutes the valid and binding obligation of such
party enforceable against such party in accordance with their respective
terms, and
(iv) this Agreement will not result in a violation of any terms or
provisions of any agreements to which such person is a party or by which
such party may otherwise be bound or of any law, rule, license, regulation,
judgment, order or decree governing or affecting such party.
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(b) The parties hereto acknowledge, warrant and represent that they have
carefully read this Agreement, understand it, have consulted with and received
the advice of counsel regarding this Agreement, agree with its terms, are duly
authorized to execute it and freely, voluntarily and knowingly execute it.
Section 2.2. General.
(a) This Agreement shall be binding upon and inure to the benefit of and be
enforceable by the parties hereto and the respective successors, personal
representatives and assigns of the parties hereto.
(b) This Agreement contains the entire agreement between the parties with
respect to the subject matter hereof and thereof and supersedes all prior and
contemplated arrangements and understandings with respect thereto.
(c) This Agreement may be signed in counterparts, each of which shall
constitute an original and all of which together shall constitute one and the
same Agreement.
(d) All notices and other communications required or permitted hereunder
shall be effective upon receipt and shall be in writing and may be delivered in
person, by telecopy, electronic mail, express delivery service or U.S. mail, in
which event it may be mailed by first-class, certified or registered, postage
prepaid, addressed to the party to be notified at the respective addresses set
forth below, or at such other addresses which may hereinafter be designated in
writing:
If to Nabi:
Nabi Biopharmaceuticals
0000 Xxxx xx Xxxxxxxx Xxxxxxxxx, X.X.
Xxxx Xxxxx, XX 00000
Attention: Xxxxxx X. XxXxxx
Fax No.: (000) 000-0000
with a copy to:
Xxxxxx, Xxxx & Xxxxxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxxx
Xxxxxxx Xxxxxxxx
Fax No.: (000) 000-0000
and
Xxxxxx, XxXxxxxxx & Fish LLP
World Trade Center West
000 Xxxxxxx Xxxxxxxxx
0
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxx
Fax No.: (000) 000-0000
If to Third Point:
Third Point LLC
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxx Xxxx
Fax No.: (000) 000-0000
with a copy to:
Xxxxxxx Xxxx & Xxxxxxxxx LLP
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxxx
Fax No.: (000) 000-0000
(e) This Agreement and the legal relations hereunder between the parties
hereto shall be governed by and construed in accordance with the laws of the
State of Delaware applicable to contracts made and performed therein, without
giving effect to the principles of conflicts of law thereof.
(f) Whenever possible, each provision of this Agreement shall be
interpreted in such manner as to be effective and valid, but if any provision of
this Agreement is held to be invalid or unenforceable in any respect, such
invalidity or unenforceability shall not render invalid or unenforceable any
other provision of this Agreement.
(g) It is hereby agreed and acknowledged that it will be impossible to
measure in money the damages that would be suffered if the parties fail to
comply with any of the obligations herein imposed on them and that in the event
of any such failure, an aggrieved person will be irreparably damaged and will
not have an adequate remedy at law. Any such person, therefore, shall be
entitled to injunctive relief, including specific performance, to enforce such
obligations, without the posting of any bond, and, if any action should be
brought in equity to enforce any of the provisions of this Agreement, none of
the parties hereto shall raise the defense that there is an adequate remedy at
law.
(h) Each party hereto shall do and perform or cause to be done and
performed all such further acts and things and shall execute and deliver all
such other agreements, certificates, instruments and documents as any other
party hereto reasonably may request in order to carry out the intent and
accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.
(i) Each of the parties hereto hereby irrevocably and unconditionally
consents to submit to the exclusive jurisdiction of the courts of the State of
Delaware and of the United
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States of America, in each case located in the County of New Castle, for any
action, proceeding or investigation in any court or before any governmental
authority arising out of or relating to this Agreement and the transactions
contemplated hereby (and agrees not to commence any action, proceeding or
investigation relating thereto except in such courts), and further agrees that
service of any process, summons, notice or document by registered mail to its
respective address set forth in this Agreement shall be effective service of
process for any action, proceeding or investigation brought against it in any
such court. Each of the parties hereto hereby irrevocably and unconditionally
waives any objection to the laying of venue of any action, proceeding or
investigation arising out of this Agreement or the transactions contemplated
hereby in the courts of the State of Delaware or the United States of America,
in each case located in the County of New Castle, and hereby further irrevocably
and unconditionally waives and agrees not to plead or claim in any such court
that any such action, proceeding or investigation brought in any such court has
been brought in an inconvenient forum.
[Remainder of page intentionally left blank.]
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the day and year first written above.
NABI BIOPHARMACEUTICALS
By: /s/ Xxxxxx X. XxXxxx
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Name: Xxxxxx X. XxXxxx
Title: Chairman, Chief Executive Officer
and President
THIRD POINT LLC
By: /s/ Xxxxxx X. Xxxx
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Name: Xxxxxx X. Xxxx
Title: Chief Executive Officer
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