MERGER PARTNER NOTEHOLDER AGREEMENT
Exhibit 2.4
EXECUTION COPY
MERGER PARTNER
NOTEHOLDER AGREEMENT
NOTEHOLDER AGREEMENT
THIS MERGER PARTNER NOTEHOLDER AGREEMENT (this “Agreement”), dated as of May 1, 2008,
is by and among Critical Therapeutics, Inc., a Delaware corporation (“Public Company”),
Cornerstone BioPharma Holdings, Inc., a Delaware corporation (“Merger Partner”),
Cornerstone BioPharma, Inc., a Nevada corporation and a wholly owned subsidiary of Merger Partner
(“Operating Company”), and Carolina Pharmaceuticals Ltd., a Bermuda Exempted Company
(“Noteholder”).
WHEREAS, concurrently with the execution and delivery of this Agreement, Public Company,
Neptune Acquisition Corp., a Delaware corporation and a wholly owned subsidiary of Public Company
(the “Transitory Subsidiary”), and Merger Partner have entered into an Agreement and Plan
of Merger, dated as of the date hereof (as it may be amended or supplemented from time to time
pursuant to the terms thereof, the “Merger Agreement”), which provides for the merger (the
“Merger”) of the Transitory Subsidiary into Merger Partner in accordance with the terms of
the Merger Agreement;
WHEREAS, the Noteholder is the holder of that certain Promissory Note, dated April 19, 2004,
with Operating Company, as amended by that certain Promissory Note Amendment and Waiver Agreement,
dated June 6, 2006 (as amended, the “Carolina Note”);
WHEREAS, as a condition and inducement to Public Company’s willingness to enter into the
Merger Agreement, Public Company requires that Noteholder enter into this Agreement, (i) to
covenant that Noteholder will exchange or convert the Carolina Note into the common stock, $0.0001
par value per share, of Merger Partner (the “Merger Partner Common Stock”) prior to the
Effective Time in accordance with the terms hereof, (ii) to give Public Company a proxy to vote all
of the shares of capital stock of Merger Partner that Noteholder owns and (iii) not to transfer or
otherwise dispose of any shares of Merger Partner Common Stock that Noteholder owns or, for 180
days after the Effective Time, any Public Company Common Stock received in exchange therefor
pursuant to the Merger; and
WHEREAS, in consideration of the execution and delivery of the Merger Agreement by Public
Company and the Transitory Subsidiary, Noteholder is willing to take such actions to facilitate the
consummation of the Merger;
NOW, THEREFORE, in consideration of the foregoing, intending to be legally bound, the parties
hereto hereby agree as follows:
1. Certain Definitions.
(a) Capitalized terms used but not otherwise defined herein shall have the meanings ascribed
thereto in the Merger Agreement. For purposes of this Agreement, the following terms shall have
the following meanings:
“Constructive Sale” means with respect to any security, a short sale with
respect to such security, entering into or acquiring an offsetting derivative contract with
respect to such security, entering into or acquiring a futures or forward contract to
deliver such security or entering into any other hedging or other derivative transaction
that has the effect of either directly or indirectly materially changing the economic
benefits or risks of ownership.
“Shares” means (i) all shares of capital stock of Merger Partner owned,
beneficially or of record, by Noteholder as of the date hereof, and (ii) all additional
shares of
capital stock of Merger Partner acquired by Noteholder, beneficially or of record,
during the period commencing with the execution and delivery of this Agreement and expiring
on the Expiration Date (as such term is defined in Section 11 below), including shares of
Merger Partner Common Stock issued to Noteholder pursuant to Section 2 hereof.
“Transfer” means, with respect to any security, the direct or indirect
assignment, sale, transfer, tender, exchange, pledge, hypothecation, or the grant, creation
or suffrage of a lien, security interest or encumbrance in or upon, or the gift, placement
in trust, or the Constructive Sale or other disposition of such security (including
transfers by testamentary or intestate succession or otherwise by operation of law) or any
right, title or interest therein (including, but not limited to, any right or power to vote
to which the holder thereof may be entitled, whether such right or power is granted by proxy
or otherwise), or the record or beneficial ownership thereof, the offer to make such a sale,
transfer, Constructive Sale or other disposition, and each agreement, arrangement or
understanding, whether or not in writing, to effect any of the foregoing.
2. Conversion or Exchange of Carolina Note.
(a) Prior to the date Public Company first files the Registration Statement with the SEC,
Noteholder shall surrender for cancellation the Carolina Note to Operating Company along with
written instructions to Operating Company and Merger Partner to cancel the Carolina Note and issue
shares of Merger Partner Common Stock in exchange for, at Noteholder’s option, all or a portion of
the Carolina Note (but in an amount not less than the principal amount outstanding under the
Carolina Note on the date of exchange) (such amount to be converted or exchanged, the “Purchase
Amount”). Upon receipt of the surrendered Carolina Note by Operating Company, Noteholder will
be deemed to be the holder of record of the shares of Merger Partner Common Stock issuable with
respect to the Purchase Amount (as calculated under Section 2(b)) as of the close of business on
the date the Carolina Note is surrendered to Operating Company, and Merger Partner will promptly
execute or cause to be executed and delivered to Noteholder a certificate or certificates
representing such number of shares. If Noteholder chooses not to convert or exchange the entire
amount of principal and accrued interest then outstanding under the Carolina Note, Operating
Company will, concurrently with Merger Partner’s delivery of said stock certificate or
certificates, deliver to Noteholder a new promissory note of like tenor evidencing the remaining
outstanding amount of the Carolina Note not so converted or exchanged for shares of Merger Partner
Common Stock. Upon surrender of the Carolina Note to Operating Company by Noteholder, all shares
of Merger Partner Common Stock deliverable and issued hereunder will be duly authorized, duly and
validly issued and outstanding, fully paid and nonassessable, and free from taxes, liens or
charges.
(b) Upon receipt of the written instructions from Noteholder pursuant to Section 2(a), Merger
Partner shall issue to Noteholder in respect of the Purchase Amount a number of shares of Merger
Partner Common Stock equal to (i) the quotient of (A) the Purchase Amount, divided by (B) the fair
market value of Merger Partner on the conversion or exchange date as determined in good faith by
the Merger Partner Board, multiplied by (ii) the sum of (A) the number of shares of Merger Partner
Common Stock outstanding immediately prior to the conversion or exchange plus (B) the number of
shares of Merger Partner Common Stock issuable upon exercise of Merger Partner Stock Options and
Merger Partner Warrants outstanding immediately prior to the conversion or exchange.
3. Transfer and Voting Restrictions With Respect to the Shares.
(a) At all times during the period commencing with the execution and delivery of this
Agreement and expiring on the Expiration Date, Noteholder shall not, except in connection with the
Merger or as the result of the death of Noteholder, Transfer any of the Shares, or discuss,
negotiate, make
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an offer or enter into an agreement, commitment or other arrangement with respect thereto,
unless the person to which such Shares are being Transferred shall have executed and delivered a
counterpart of this Agreement and agreed pursuant thereto, for the benefit of Public Company and
Transitory Subsidiary, to hold such Shares subject to all terms and conditions of this Agreement.
(b) Noteholder understands and agrees that if Noteholder attempts to Transfer, vote or provide
any other person with the authority to vote any of the Shares other than in compliance with this
Agreement, Merger Partner shall not, and Noteholder hereby unconditionally and irrevocably
instructs Merger Partner to not, (i) permit any such Transfer on its books and records, (ii) issue
a new certificate representing any of the Shares or (iii) record such vote, in each case, unless
and until Noteholder shall have complied with the terms of this Agreement.
(c) Except as otherwise permitted by this Agreement or by order of a court of competent
jurisdiction, Noteholder will not commit any act that could restrict or affect Noteholder’s legal
power, authority and right to vote all of the Shares then owned of record or beneficially by
Noteholder or otherwise prevent or disable Noteholder from performing any of his, her or its
obligations under this Agreement. Without limiting the generality of the foregoing, except for
this Agreement and as otherwise permitted by this Agreement, Noteholder will not enter into any
voting agreement with any person or entity with respect to any of the Shares, grant any person or
entity any proxy (revocable or irrevocable) or power of attorney with respect to any of the Shares,
deposit any of the Shares in a voting trust or otherwise enter into any agreement or arrangement
with any person or entity limiting or affecting Noteholder’s legal power, authority or right to
vote the Shares in favor of the approval of the Proposed Transaction.
4. Agreement to Vote Shares.
(a) Prior to the Expiration Date, at every meeting of the stockholders of Merger Partner
called, and at every adjournment or postponement thereof, and on every action or approval by
written consent of the stockholders of Merger Partner, Noteholder (in Noteholder’s capacity as
such) shall appear at the meeting or otherwise cause the Shares to be present thereat for purposes
of establishing a quorum and, to the extent not voted by the persons appointed as proxies pursuant
to this Agreement, vote (i) in favor of adoption of the Merger Agreement and approval of the
transactions contemplated thereby (collectively, the “Proposed Transaction”), (ii) against
the approval or adoption of any proposal made in opposition to, or in competition with, the
Proposed Transaction, and (iii) against any of the following (to the extent unrelated to the
Proposed Transaction): (A) any merger, consolidation or business combination involving Merger
Partner or any of its subsidiaries other than the Proposed Transaction; (B) any sale, lease or
transfer of all or substantially all of the assets of Merger Partner or any of its subsidiaries;
(C) any reorganization, recapitalization, dissolution, liquidation or winding up of Merger Partner
or any of its subsidiaries; or (D) any other action that is intended, or could reasonably be
expected, to result in a breach of any covenant, representation or warranty or any other obligation
or agreement of Merger Partner under the Merger Agreement or of Noteholder under this Agreement or
otherwise impede, interfere with, delay, postpone, discourage or adversely affect the consummation
of the Proposed Transaction (each of (ii) and (iii), a “Competing Transaction”).
(b) If Noteholder is the beneficial owner, but not the record holder, of the Shares,
Noteholder agrees to take all actions necessary to cause the record holder and any nominees to vote
all of the Shares in accordance with Section 4(a).
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5. Grant of Irrevocable Proxy.
(a) Noteholder hereby irrevocably (to the fullest extent permitted by law) grants to, and
appoints, Public Company and each of its executive officers and any of them, in their capacities as
officers of Public Company (the “Grantees”), as Noteholder’s proxy and attorney-in-fact
(with full power of substitution and re-substitution), for and in the name, place and stead of
Noteholder, to vote the Shares, to instruct nominees or record holders to vote the Shares, or grant
a consent or approval in respect of such Shares in accordance with Section 4 hereof and, in the
discretion of the Grantees with respect to any proposed adjournments or postponements of any
meeting of Noteholders at which any of the matters described in Section 4 hereof is to be
considered.
(b) Noteholder represents that any proxies heretofore given in respect of the Shares that may
still be in effect are not irrevocable, and such proxies are hereby revoked.
(c) Noteholder hereby affirms that the irrevocable proxy set forth in this Section 5 is given
in connection with the execution of the Merger Agreement, and that such irrevocable proxy is given
to secure the performance of the duties of Noteholder under this Agreement. Noteholder hereby
further affirms that the irrevocable proxy is coupled with an interest and may under no
circumstances be revoked. Noteholder hereby ratifies and confirms all that such irrevocable proxy
may lawfully do or cause to be done by virtue hereof. Such irrevocable proxy is executed and
intended to be irrevocable in accordance with the provisions of Section 212 of the Delaware General
Corporation Law.
(d) The Grantees may not exercise this irrevocable proxy on any other matter except as
provided above. Noteholder may vote the Shares on all other matters.
(e) Public Company may terminate this proxy with respect to Noteholder at any time at its sole
election by written notice provided to Noteholder.
6. No Solicitation. Noteholder, in his, her or its capacity as a Noteholder, shall
not directly or indirectly, (a) solicit, initiate, encourage, induce or facilitate the making,
submission or announcement of any Acquisition Proposal or take any action that could reasonably be
expected to lead to an Acquisition Proposal, (b) furnish any information with respect to or in
connection with or in response to an Acquisition Proposal or an inquiry or indication of interest
that could reasonably be expected to lead to an Acquisition Proposal, (c) engage in discussions or
negotiations with any person with respect to any Acquisition Proposal, (d) approve, endorse or
recommend any Acquisition Proposal or (e) enter into any letter of intent or similar document or
any contract contemplating or otherwise relating to any Acquisition Proposal.
7. Lock-Up With Respect to Public Company Common Stock. Noteholder shall not during
the period commencing upon the Effective Time and ending 180 days after the date on which the
Effective Time occurs, Transfer any shares of Public Company Common Stock or any securities
convertible into or exercisable or exchangeable for Public Company Common Stock. The foregoing
sentence shall not apply to (a) transactions relating to shares of Public Company Common Stock or
other securities acquired in open market transactions after the Effective Time; provided
that no filing under Section 16(a) of the Exchange Act shall be required or shall be voluntarily
made in connection with subsequent sales of shares of Public Company Common Stock acquired in such
open market transactions; (b) transfers of shares of Public Company Common Stock as a bona fide
gift; (c) distributions of shares of Public Company Common Stock to limited partners, members or
shareholders of the Noteholder; (d) transfers to any family limited partnership or family limited
liability company whose partnership or equity interests are owned by, or a trust for the direct or
indirect benefit of, or controlled by, the Noteholder or the immediate family of the Noteholder;
(e) transfers to the Noteholder’s Affiliates or to any investment
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fund or other entity controlled or managed by the Noteholder; provided that in the
case of any transfer or distribution pursuant to clause (b), (c), (d) or (e), (i) each donee,
distributee or transferee shall sign and deliver a lock-up letter containing substantially similar
provisions as are set forth in this Section 7 and (ii) no filing under Section 16(a) of the
Exchange Act, reporting a reduction in beneficial ownership of shares of Public Company Common
Stock, shall be required or shall be voluntarily made during the restricted period referred to in
the foregoing sentence; or (f) transfers to any beneficiary of the Noteholder pursuant to will,
intestacy or other testamentary document or applicable laws of descent. In addition, the
Noteholder agrees that, without the prior written consent of Public Company, it will not, during
the period commencing on the Effective Time and ending 180 days after the date on which the
Effective Time occurs, make any demand for or exercise any right with respect to, the registration
of any shares of Public Company Common Stock or any securities convertible into or exercisable or
exchangeable for Public Company Common Stock. The Noteholder also agrees and consents to the entry
of stop transfer instructions with Public Company’s transfer agent and registrar against the
transfer of the undersigned’s shares of Public Company Common Stock or any securities convertible
into or exercisable or exchangeable for Public Company Common Stock except in compliance with the
foregoing restrictions.
8. Action in Noteholder Capacity Only. Noteholder makes no agreement or understanding
herein as a director or officer of Merger Partner. Noteholder signs solely in Noteholder’s
capacity as a record holder and beneficial owner, as applicable, of Shares, and nothing herein
shall limit or affect any actions taken in Noteholder’s capacity as an officer or director of
Merger Partner.
9. Representations and Warranties of Noteholder.
(a) Noteholder hereby represents and warrants to Public Company as follows: (i) Noteholder is
the beneficial or record owner of the shares of capital stock of Merger Partner indicated on the
signature page of this Agreement free and clear of any and all pledges, liens, security interests,
mortgage, claims, charges, restrictions, options, title defects or encumbrances; (ii) Noteholder
does not beneficially own any securities of Merger Partner other than the shares of capital stock
and rights to purchase shares of capital stock of Merger Partner set forth on the signature page of
this Agreement; (iii) Noteholder has full power and authority to make, enter into and carry out the
terms of this Agreement and to grant the irrevocable proxy as set forth in Section 5; and (iv) this
Agreement has been duly and validly executed and delivered by Noteholder and constitutes a valid
and binding agreement of Noteholder enforceable against Noteholder in accordance with its terms.
Noteholder agrees to notify Public Company promptly of any additional shares of capital stock of
Merger Partner of which Noteholder becomes the beneficial owner after the date of this Agreement.
(b) As of the date hereof and for so long as this Agreement remains in effect, except for this
Agreement or as otherwise permitted by this Agreement, Noteholder has full legal power, authority
and right to vote all of the Shares then owned of record or beneficially by Noteholder, in favor of
the approval and authorization of the Proposed Transaction without the consent or approval of, or
any other action on the part of, any other person or entity (including, without limitation, any
governmental entity). Without limiting the generality of the foregoing, Noteholder has not entered
into any voting agreement (other than this Agreement) with any person with respect to any of the
Shares, granted any person any proxy (revocable or irrevocable) or power of attorney with respect
to any of the Shares, deposited any of the Shares in a voting trust or entered into any arrangement
or agreement with any person limiting or affecting Noteholder’s legal power, authority or right to
vote the Shares on any matter.
(c) The execution and delivery of this Agreement and the performance by Noteholder of his, her
or its agreements and obligations hereunder will not result in any breach or violation of or be in
conflict with or constitute a default under any term of any agreement, judgment, injunction, order,
decree, law, regulation or arrangement to which Noteholder is a party or by which
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Noteholder (or any of his, her or its assets) is bound, except for any such breach, violation,
conflict or default which, individually or in the aggregate, would not impair or adversely affect
Noteholder’s ability to perform his, her or its obligations under this Agreement or render
inaccurate any of the representations made by Noteholder herein.
(d) Except as disclosed pursuant to the Merger Agreement, no investment banker, broker, finder
or other intermediary is entitled to a fee or commission from Public Company, the Transitory
Subsidiary or Merger Partner in respect of this Agreement based upon any arrangement or agreement
made by or on behalf of Noteholder.
(e) Noteholder understands and acknowledges that Public Company, the Transitory Subsidiary and
Merger Partner are entering into the Merger Agreement in reliance upon Noteholder’s execution and
delivery of this Agreement and the representations and warranties of Noteholder contained herein.
10. Exchange of Shares; Waiver of Rights of Appraisal. If the Merger is consummated,
the Shares shall, pursuant to the terms of the Merger Agreement, be exchanged for the consideration
provided in the Merger Agreement. Noteholder hereby waives, and agrees to prevent the exercise of,
any rights of appraisal with respect to the Merger, or rights to dissent from the Merger, that such
Noteholder may have by virtue of his, her or its beneficial ownership of the Shares.
11. Confidentiality. Noteholder recognizes that successful consummation of the
Proposed Transaction may be dependent upon confidentiality with respect to the matters referred to
herein. In this connection, pending public disclosure thereof, and so that Public Company may rely
on the safe harbor provisions of Rule 100(b)(2)(ii) of Regulation FD promulgated under the Exchange
Act, Noteholder hereby agrees not to disclose or discuss such matters with anyone not a party to
this Agreement (other than its counsel and advisors, if any) without the prior written consent of
Public Company and Merger Partner, except for disclosures Noteholder’s counsel advises are required
by applicable law, in which case Noteholder shall give notice of such disclosure to Public Company
and Merger Partner as promptly as practicable so as to enable Public Company and Merger Partner to
seek a protective order from a court of competent jurisdiction with respect thereto.
12. Termination. This Agreement, other than Sections 7 and 13 hereof, shall terminate
and be of no further force or effect whatsoever as of the earlier of (a) such date and time as the
Merger Agreement shall have been validly terminated pursuant to the terms of Article 8 thereof or
(b) the Effective Time (the “Expiration Date”). Notwithstanding anything in this Agreement
to the contrary, Sections 7 and 13 hereof shall remain in full force and effect following the
Effective Time for the time period provided in Section 7.
13. Miscellaneous Provisions.
(a) Amendments, Modifications and Waivers. This Agreement may not be amended or
modified except by an instrument in writing signed on behalf of each of the parties hereto. Any
agreement on the part of a party hereto to any waiver of any term or condition hereof shall be
valid only if set forth in a written instrument signed on behalf of such party. Such waiver shall
not be deemed to apply to any term or condition other than that which is specified in such waiver.
The failure of any party to this Agreement to assert any of its rights under this Agreement or
otherwise shall not constitute a waiver of such rights.
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(b) Entire Agreement. This Agreement constitutes the entire agreement among the
parties to this Agreement and supersedes any prior understandings, agreements or representations by
or among the parties hereto, or any of them, written or oral, with respect to the subject matter
hereof.
(c) Governing Law. All matters arising out of or relating to this Agreement and the
transactions contemplated hereby (including without limitation its interpretation, construction,
performance and enforcement) shall be governed by and construed in accordance with the internal
laws of the State of Delaware without giving effect to any choice or conflict of law provision or
rule (whether of the State of Delaware or any other jurisdiction) that would cause the application
of laws of any jurisdictions other than those of the State of Delaware.
(d) Submission to Jurisdiction. Each of the parties to this Agreement (i) consents to
submit itself to the exclusive personal jurisdiction of the Court of Chancery of the State of
Delaware in any action or proceeding arising out of or relating to this Agreement or any of the
transactions contemplated by this Agreement, (ii) agrees that all claims in respect of such action
or proceeding may be heard and determined in such court, (iii) agrees that it shall not attempt to
deny or defeat such personal jurisdiction by motion or other request for leave from such court and
(d) agrees not to bring any action or proceeding arising out of or relating to this Agreement or
any of the transaction contemplated by this Agreement in any other court. Each of the parties
hereto waives any defense of inconvenient forum to the maintenance of any action or proceeding so
brought and waives any bond, surety or other security that might be required of any other party
with respect thereto. Any party may make service on another party by sending or delivering a copy
of the process to the party to be served at the address and in the manner provided for the giving
of notices in Section 13(m) hereof. Nothing in this Section 13(d), however, shall affect the right
of any party to serve legal process in any other manner permitted by law.
(e) WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ALL
RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT
OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY
OR THE ACTIONS OF ANY PARTY IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE AND ENFORCEMENT OF THIS
AGREEMENT.
(f) Attorneys’ Fees. In any action at law or suit in equity to enforce this Agreement
or the rights of any of the parties hereunder, the prevailing party in such action or suit shall be
entitled to receive its reasonable attorneys’ fees and all other reasonable costs and expenses
incurred in such action or suit.
(g) Assignment and Successors. No party may assign any of its rights or delegate any
of its performance obligations under this Agreement, in whole or in part, by operation of law or
otherwise without the prior written consent of the other parties, except that Public Company,
without obtaining the consent of any other parties hereto, shall be entitled to assign this
Agreement or all or any of its rights or obligations hereunder to any one or more of its
Affiliates. No assignment by Public Company under this Section 13(g) shall relieve Public Company
of its obligations under this Agreement. Subject to the foregoing, this Agreement shall be binding
upon, inure to the benefit of, and be enforceable by, the parties hereto and their respective
successors and permitted assigns, including, without limitation, Noteholder’s estate and heirs upon
the death of Noteholder. Any purported assignment of rights or delegation of performance
obligations in violation of this Section 13(g) shall be null and void.
(h) No Third Party Beneficiaries. This Agreement is not intended, and shall not be
deemed, to confer any rights or remedies upon any person other than the parties hereto and their
respective successors and permitted assigns, or to otherwise create any third-party beneficiary
hereto.
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(i) Cooperation. Noteholder agrees to cooperate fully with Public Company and to
execute and deliver such further documents, certificates, agreements and instruments and to take
such other actions as may be reasonably requested by Public Company to evidence or reflect the
transactions contemplated by this Agreement and to carry out the intent and purpose of this
Agreement. Noteholder hereby agrees that Public Company and Merger Partner may publish and
disclose in the Registration Statement and any resale registration statement relating thereto
(including all documents and schedules filed with the SEC) and the Proxy Statement/Prospectus, such
Noteholder’s identity and ownership of Shares and the nature of such Noteholder’s commitments,
arrangements and understandings under this Agreement and may further file this Agreement as an
exhibit to the Registration Statement or in any other filing made by Public Company or Merger
Partner with the SEC relating to the Proposed Transaction.
(j) Severability. Any term or provision of this Agreement that is invalid or
unenforceable in any situation in any jurisdiction shall not affect the validity or enforceability
of the remaining terms and provisions hereof or the validity or enforceability of the offending
term or provision in any other situation or in any other jurisdiction. If the final judgment of a
court of competent jurisdiction declares that any term or provision hereof is invalid or
unenforceable, the parties hereto agree that the court making such determination shall have the
power to limit the term or provision, to delete specific words or phrases, or to replace any
invalid or unenforceable term or provision with a term or provision that is valid and enforceable
and that comes closest to expressing the intention of the invalid or unenforceable term or
provision, and this Agreement shall be enforceable as so modified. In the event such court does
not exercise the power granted to it in the prior sentence, the parties hereto agree to replace
such invalid or unenforceable term or provision with a valid and enforceable term or provision that
will achieve, to the extent possible, the economic, business and other purposes of such invalid or
unenforceable term.
(k) Time of Essence. With regard to all dates and time periods set forth or referred
to in this Agreement, time is of the essence.
(l) Specific Performance; Injunctive Relief. The parties hereto acknowledge that
Public Company and Merger Partner shall be irreparably harmed and that there shall be no adequate
remedy at law for a violation of any of the covenants or agreements of Noteholder set forth in this
Agreement. Noteholder accordingly agrees that, in addition to any other remedies that may be
available to Public Company or Merger Partner, as applicable upon any such violation, such party
shall have the right to enforce such covenants and agreements by specific performance, injunctive
relief or by any other means available to such party at law or in equity without posting any bond
or other undertaking.
(m) Notices. All notices and other communications hereunder shall be in writing and
shall be deemed duly delivered (i) four business days after being sent by registered or certified
mail, return receipt requested, postage prepaid, or (ii) one business day after being sent for next
business day delivery, fees prepaid, via a reputable nationwide overnight courier service, in each
case to the intended recipient as follows: (A) if to Public Company or Merger Partner, to the
address provided in the Merger Agreement, including to the persons designated therein to receive
copies, and (B) if to Noteholder, to Noteholder’s address shown below Noteholder’s signature on the
signature page hereof.
(n) Counterparts and Signature. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all of which together shall be
considered one and the same agreement and shall become effective when counterparts have been signed
by each of the parties hereto and delivered to the other parties, it being understood that all
parties need not sign the same counterpart. The exchange of copies of this Agreement of amendments
thereto and of signature pages by facsimile transmission or by email transmission in portable
document format, or similar format, shall constitute effective execution and delivery of such
instrument(s) as to the parties and may be used in lieu
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of the original Agreement for all purposes. Signatures of the parties transmitted by
facsimile or by email transmission in portable document format, or similar format, shall be deemed
to be their original signatures for all purposes.
(o) Headings. The headings contained in this Agreement are for convenience of
reference only and shall not affect in any way the meaning or interpretation of this Agreement.
(p) Legal Representation. This Agreement was negotiated by the parties with the
benefit of legal representation and any rule of construction or interpretation otherwise requiring
this Agreement to be construed or interpreted against any party shall not apply to any construction
or interpretation thereof.
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IN WITNESS WHEREOF, the undersigned have caused this Agreement to be duly executed as of the
date first written above.
CRITICAL THERAPEUTICS, INC.: |
NOTEHOLDER: | ||||
| CAROLINA PHARMACEUTICALS LTD. | |||||
/s/ Xxxxxx Xxxxxxxx
|
|||||
Title: President and Chief
Executive Officer |
/s/ Xxxxx X. Xxxxxxx
|
||||
| Title: CEO | |||||
| Address: | |||||
| 2000 Xxxxxxx Xxxxxxx, Xxxxx 000 | |||||
| Xxxx, XX 00000 | |||||
| Telephone: | (000) 000-0000 | ||||
| Facsimile: | (000) 000-0000 | ||||
| E-Mail Address: xxxxxxxx@xxxxxxxxxxxxxxxxxxxx.xxx | |||||
| Shares Beneficially Owned by Noteholder: | |||||
| * shares of Merger Partner Common Stock | |||||
| None Merger Partner Stock Options | |||||
| None Merger Partner Warrants | |||||
| * Equal to the number of shares to be issued in connection with the Agreement | |||||
[Signature Page to Merger Partner Noteholder Agreement]
CORNERSTONE BIOPHARMA HOLDINGS, INC.: |
||
/s/ Xxxxx X. Xxxxxxx
|
||
Title: President and Chief Executive Officer |
||
CORNERSTONE BIOPHARMA, INC.: |
||
/s/ Xxxxx X. Xxxxxxx
|
||
Title: President and Chief Executive Officer |
[Signature Page to Merger Partner Noteholder Agreement]
