SETTLEMENT AGREEMENT
THIS SETTLEMENT AGREEMENT
(this “Agreement”) is made
by and between NuRx Pharmaceuticals, Inc. (“NuRx”), a corporation
existing under the laws of Nevada, and DYVA Holding Ltd. (“DYVA”), a corporation
existing under the laws of Switzerland. NuRx and DYVA are sometimes
individually referred to herein as a “Party” and
collectively as the “Parties.”
W I T N E
S S E T H:
WHEREAS,
NuRx and DYVA are parties to a lawsuit titled “DYVA Holding Ltd. v. NuRx
Pharmaceuticals, Inc.,” Case No. 2:09-cv-2178-KJD-LRL, pending in the United
States District Court, District of Nevada (the “Lawsuit”);
and
WHEREAS,
NuRx and DYVA are desirous of settling and resolving the Lawsuit on the terms
and conditions set forth in this Agreement.
NOW
THEREFORE, in consideration of the mutual covenants and conditions set forth
herein, NuRx and DYVA agree as follows:
SECTION
1
Representations
and Warranties
1.1 Authorization;
Enforceability. Each Party represents and warrants to the
other Party that such Party has all requisite power and authority or capacity to
execute, deliver and perform its obligations under this Agreement and any other
document to be executed and delivered by it pursuant hereto. The
execution, delivery and performance by such Party of this Agreement and any
other document to be executed and delivered by it pursuant hereto, and the
consummation by such Party of the transactions contemplated by this Agreement,
have been duly authorized by all necessary corporate or other action of such
Party and no other action on the part of such Party is necessary to authorize
this Agreement or the transactions contemplated by this
Agreement. This Agreement and any other document to be executed and
delivered by such Party pursuant hereto have been duly executed and delivered by
such Party and constitute valid and binding obligations of such Party,
enforceable against such Party in accordance with their respective
terms.
1.2 Absence of
Conflict. Each Party represents and warrants to the other
Party that neither the execution and delivery by such Party of this Agreement,
nor the consummation by such Party of the transactions contemplated by this
Agreement: (i) violates, is in conflict with, accelerates the performance
required by or constitutes a default (or an event which, with notice or lapse of
time or both, would constitute a default) under any material agreement or
commitment to which such Party is a party or by which any of such Party’s
properties or assets is bound, (ii) violates any statute or law or any judgment,
decree, order, regulation or rule of any court or other governmental authority
applicable to such Party, or (iii) conflicts with or violates any provision of
such Party’s charter, bylaws or any equivalent organizational or governing
documents.
SECTION
2
Payment
NuRx
shall pay to DYVA, in care of the Trust Account at the law firm of Xxxxxxxxxx
Xxxxx Xxxxxx Xxxxxxx, LLP (“BHFS”), the sum of
FOUR HUNDRED THOUSAND AND NO/100 DOLLARS ($400,000.00) to BHFS on or before
12:00 PM on April 8, 2010.
SECTION
3
Mutual
Release
3.1 Except
for the obligations set forth in this Settlement Agreement, NuRx hereby forever
releases and discharges DYVA and its past and present subsidiary corporations,
parent corporations, affiliates, partners, members, joint venturers, heirs,
successors, assigns, officers, directors, shareholders, employees, agents,
attorneys and insurers (in their individual and representative capacities) from
any and all claims, demands, losses, damages, actions, causes of action, suits,
debts, promises, liabilities, obligations, liens, costs, expenses, attorneys’
fees, indemnities, subrogations (contractual or equitable) or duties, of any
nature, character or description whatsoever, whether known or unknown, fixed or
contingent, accrued or not yet accrued, matured or not yet matured, anticipated
or unanticipated, asserted or unasserted, arising from or related to, directly
or indirectly, the Lawsuit.
3.2 Except
for the obligations set forth in this Settlement Agreement, and upon the receipt
of all of the consideration specified in Section 2, DYVA
forever releases and discharges NuRx and its past and present subsidiary
corporations, parent corporations, affiliates, partners, members, joint
venturers, heirs, successors, assigns, officers, directors, shareholders,
employees, agents, attorneys and insurers (in their individual and
representative capacities) from any and all claims, demands, losses, damages,
actions, causes of action, suits, debts, promises, liabilities, obligations,
liens, costs, expenses, attorneys’ fees, indemnities, subrogations (contractual
or equitable) or duties, of any nature, character or description whatsoever,
whether known or unknown, fixed or contingent, accrued or not yet accrued,
matured or not yet matured, anticipated or unanticipated, asserted or
unasserted, arising from or related to, directly or indirectly, the
Lawsuit.
SECTION
4
Dismissal
of the Lawsuit
Upon
NuRx’s satisfaction of all obligations in Sections 2, 5 and 6, the Lawsuit shall
be dismissed with prejudice by the filing of a Stipulation and Order for
Dismissal with Prejudice, attached to this Agreement as Exhibit
A.
SECTION
5
Amendment
to Rights Agreement
Upon
execution of this Settlement Agreement, NuRx shall provide satisfactory proof
that it has amended the Stockholder Rights Agreement, dated June 1, 2009, by and
between NuRx and Continental Stock Transfer & Trust Company as Rights
Agent (“CST”),
as amended by the Amendment to Stockholder Rights Agreement, dated January 27,
2010, by and between NuRx and CST (as amended, the “Rights Agreement”)
such that the definition of “Exempt Person” in Section 1 of the Rights
Agreement shall be amended and restated to read in its entirety as
follows:
“Exempt Person”
means
(i) the
Company, any Subsidiary of the Company, any employee benefit plan or employee
stock plan of the Company or of any Subsidiary of the Company, or any person or
entity organized, appointed, established or holding Company Common Stock for or
pursuant to the terms of any such plan;
(ii) any
Person who would otherwise become an Acquiring Person solely by virtue of a
reduction in the number of outstanding shares of Company Common Stock; provided, however, that any such Person
shall not be an Exempt Person if, subsequent to such reduction, such Person
shall become the Beneficial Owner of any additional shares of Company Common
Stock;
(iii) Xx.
Xxxxxxx Xxxx and his immediate family members and their Affiliates and
Associates, provided,
however, that any such
Person shall not be an Exempt Person if such Person shall become the Beneficial
Owner of any additional shares of Company Common Stock after the effective time
of this Agreement;
(iv) Parent
and Merger Sub (each as defined in the Merger Agreement), either individually or
together, solely in connection with the approval, execution and delivery of the
Merger Agreement and the Voting Agreements, and any of the transactions
contemplated thereby, including, but not limited to, the Merger (as defined in
the Merger Agreement); or
(v) DYVA
Holding Ltd. and its Affiliates and their respective Associates; provided, however, that no such person
shall be an Exempt Person if DYVA Holding Ltd. shall become the Beneficial
Owner, either directly or beneficially, of any additional shares of Company
Common Stock acquired during the period beginning April 9, 2010 and ending April
9, 2012.”
SECTION
6
Redemption
Plan
At the
time of execution of this Settlement Agreement, NuRx shall provide satisfactory
proof that it has withdrawn its claimed redemption rights over any of DYVA’s
shares, whether directly or beneficially owned. NuRx further
represents and warrants that its redemption By Law adopted on September 22,
2009, is inapplicable to all of DYVA’s shares, as those shares were acquired
prior to the redemption By Law’s existence.
SECTION
7
Voting
Agreement
DYVA
shall execute and deliver to NuRx the voting agreement in substantially the form
attached hereto as Exhibit
B.
SECTION
8
Binding
Effect
This
Agreement shall inure to the benefit of and be binding upon the Parties and
their respective heirs, successors and assigns.
SECTION
9
Time
of the Essence
Time is
of the essence of this Agreement and all of its terms, provisions, conditions
and covenants.
SECTION
10
Entire
Agreement
This
Agreement contains the entire agreement between the Parties and may not be
changed or terminated orally but only by a written instrument executed by the
Parties after the date of this Agreement.
SECTION
11
Construction
The terms
and conditions of this Agreement shall be construed as a whole according to its
fair meaning and not strictly for or against any Party. The Parties
acknowledge that each of them has reviewed this Agreement and has had the
opportunity to have it reviewed by their respective attorneys and
that any rule of construction to the effect that ambiguities are to be resolved
against the drafting party shall not apply in the interpretation of this
Agreement.
SECTION
12
Attorneys’
Fees
In any
action or proceeding to enforce the terms of this Agreement or to redress any
violation of this Agreement, the prevailing party shall be entitled to recover
as damages its attorneys’ fees and costs incurred, whether or not the action is
reduced to judgment. For the purposes of this provision, the
“prevailing party” shall be that party who has been successful with regard to
the main issue, even if that party did not prevail on all issues.
SECTION
13
Governing
Law and Forum
The laws
of the State of Nevada (without giving effect to choice of law or conflict of
law principles) shall govern this Agreement, including the validity,
construction, performance and effect thereof. Any lawsuit, action or
proceeding to interpret or enforce the terms of this Agreement shall be brought
in a court of competent jurisdiction in the County of Xxxxx, State of
Nevada.
SECTION
14
Necessary
Action
Each of
the Parties shall do any act or thing and execute any and all documents or
instruments necessary or proper to effectuate the provisions and intent of this
Agreement.
SECTION
15
Counterparts
This
Agreement may be executed in any number of counterparts, each of which when duly
executed and delivered shall be deemed an original, but all such counterparts
shall constitute one and the same agreement. Any signature page of
this Agreement may be detached from any counterpart without impairing the legal
effect of any signatures, and may be attached to another counterpart, identical
in form, but having attached to it one or more additional signature
pages. This Agreement may be executed by signatures provided by
electronic facsimile transmission (also known as “Fax” copies), which facsimile
signatures shall be as binding and effective as original
signatures.
SECTION
16
Effective
Date of Agreement
The
effective date of this Agreement shall be the date on which the last Party who
is to sign this Agreement signs the Agreement.
SETTLEMENT
AGREEMENT, Page 5 of 6
SECTION
17
Authority
to Execute
Each
Party represents, covenants and warrants to the other that it has all the
necessary and required power and authority to enter into this Agreement, and
that each individual executing this Agreement on behalf of any Party
specifically warrants that he or she has the authority to bind that entity by
his or her signature.
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“DYVA”
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“NuRx”
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Executed
this 9th day of April 2010
|
Executed
this 9th day of April 2010
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DYVA
HOLDING LTD.
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| By: |
/s/
Xxxx Xxxxxx
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By: |
/s/
Xxxxx Xxxxx-Xxxxxx
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|
Name: Xxxx
Xxxxxx
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Name: Xxxxx
Xxxxx-Xxxxxx
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|
Title:Attorney-in-Fact
|
Title:Chief
Executive Officer
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SETTLEMENT AGREEMENT, Page 6 of 6
