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STOCK PURCHASE AGREEMENT
Dated as of September 3, 1997
By and Between
PANAX PHARMACEUTICAL COMPANY, LTD.
and
XXXXXXX X. XXXXX
AND
SANGEN PHARMACEUTICAL COMPANY, INC
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STOCK PURCHASE AGREEMENT
STOCK PURCHASE AGREEMENT dated as of September 3, 1997 by and between
PANAX PHARMACEUTICAL COMPANY, LTD., a New York corporation ("Purchaser"), and
XXXXXXX X. XXXXX, an individual ("Stockholder") AND SANGEN PHARMACEUTICAL
COMPANY, INC., a Delaware corporation (the"Company").
W I T N E S S E T H:
WHEREAS, the Stockholder owns 100 shares of common stock, $1.00 par
value per share (the "Stock"), of the Company, being all of the outstanding
shares of capital stock of the Company;
WHEREAS, the Stockholder desires to sell, and Purchaser desires to
purchase, the Stock pursuant to this Agreement; and
WHEREAS, it is the intention of the parties hereto that, upon
consummation of the purchase and sale of the Stock pursuant to this Agreement,
Purchaser shall own all of the outstanding shares of capital stock of the
Company.
NOW, THEREFORE, in consideration of the recitals and of the
respective covenants, representations, warranties and agreements herein
contained, and intending to be legally bound hereby, the parties hereto,
hereby agree as follows:
ARTICLE I
PURCHASE AND SALE OF STOCK
1.1. Purchase and Sale of Stock. Subject to the terms and conditions
herein stated, the Stockholder agrees to sell, assign, transfer and deliver
the Stock to Purchaser on the Closing Date (as defined in Section 1.3 below),
and Purchaser agrees to purchase the Stock from the Stockholder on the Closing
Date.
1.2. Purchase Price. In consideration for the purchase by Purchaser
of the Stock, Purchaser shall deliver to Stockholder on the Closing Date the
Common Stock Purchase Option in the form of Exhibit A attached hereto (the
"Purchase Option"), duly executed by the Purchaser. Purchaser shall have the
right to repurchase the right to acquire up to 900,000 shares represented by
the Purchase Option, based on the terms and conditions more fully set forth in
the Employment Agreement attached hereto as Exhibit B.
1.3. Closing. Closing shall be held on October 31, 1997 at the
offices of Todtman, Nachamie, Xxxxxxx & Spizz, P.C. 000 Xxxx Xxxxxx, Xxx Xxxx,
XX 00000 at 10:00 a.m., or at such other date or other time and place as
Purchaser and Stockholder shall agree in writing ("Closing Date").
1.4. Possible Additional Consideration. If, on the Closing Date,
Purchaser's "Fully Diluted Capitalization" shall be greater than 16,000,000
shares, then and in such event Purchaser shall issue to Stockholder at Closing
options (the "Options") to purchase that number of shares of the Purchaser's
Common Stock which is equal to the difference between 1,200,000 and 7.5 % of
the Fully Diluted Capitalization. The exercise price of the Options shall be
equal to the price at which the Purchaser's Common Stock is sold in the
Offering (as that term is defined in the PPM referred to in Section 3.2
below), the Options shall be exercisable for a period of 10 years from
issuance, shall be in form substantially identical to the form of Exhibit A
hereto, and shall otherwise be in such form as shall be mutually satisfactory
to Purchaser and Stockholder. Fully Diluted Capitalization shall have the
meaning set forth in the PPM. The right to purchase all the shares subject to
the Options shall be subject to Purchaser's repurchase rights as more fully
set forth in the Employment Agreement attached hereto as Exhibit B.
ARTICLE II
REPRESENTATIONS OF THE STOCKHOLDER AND THE COMPANY
The Stockholder and the Company, jointly and severally, represent,
warrant and agree to and with Purchaser, as follows:
2.1. Ownership of Stock. The Stockholder is the lawful owner of the
Stock, free and clear of all liens, encumbrances, restrictions and claims of
every kind; the Stockholder has full legal right, power and authority to enter
into this Agreement and to sell, assign, transfer and convey the Stock
pursuant to this Agreement; the delivery to Purchaser of the Stock pursuant to
the provisions of this Agreement will transfer to Purchaser valid title
thereto, free and clear of all liens, encumbrances, restrictions and claims of
every kind.
2.2. Existence and Good Standing. The Company is a corporation duly
organized, validly existing and in good standing under the laws of the State
of Delaware. The Company has the power to own its property and to carry on its
business as now being conducted. The Company is duly qualified to do business
and is in good standing in each jurisdiction in which the character or
location of the properties owned or leased by the Company or the nature of the
business conducted by the Company makes such qualification necessary.
2.3. Capital Stock.
(a) The Company has an authorized capitalization consisting
of 1,000 shares of common stock, $1.00 par value per share, of which 100
shares are issued and outstanding. All such outstanding shares have been duly
authorized and validly issued and are fully paid and nonassessable. There are
no outstanding options, warrants, rights, calls, commitments, conversion
rights, rights of exchange, plans or other agreements of any character
providing for the purchase, issuance or sale of any shares of the capital
stock of the Company, other than as contemplated by this Agreement.
(b) The Stockholder is the record and beneficial owner of
all of the issued and outstanding shares of the capital stock of the Company.
2.4. Subsidiaries and Investments. The Company does not have,
directly or indirectly, any capital stock or other equity or ownership or
proprietary interest in any corporation, partnership, association, trust,
joint venture or other entity.
2.5. Financial Statements and No Material Changes. The Stockholder
has heretofore furnished the Purchaser with the balance sheet of the Company
as of June 30, 1997 (the balance sheet of the Company as at June 30, 1997 is
hereinafter referred to as the "Balance Sheet"). The Balance Sheet has been
prepared in accordance with generally accepted accounting principles
consistently followed throughout the period indicated. The Balance Sheet
fairly presents the financial condition of the Company at the date thereof
and, except as indicated therein, reflects all claims against and all debts
and liabilities of the Company, fixed or contingent, as at the date thereof.
Since June 30, 1997 (the "Balance Sheet Date") there has been no material
adverse change in the assets or liabilities, or in the business or condition,
financial or otherwise, or in the results of operations or prospects, of the
Company except in the ordinary course of business.
2.6. Material Contracts. Except for the agreements set forth in
Schedule 2.6 attached hereto (such agreements are hereinafter referred to as
the "Allegheny Agreements"), the Company is not bound by (a) any agreement,
contract or commitment relating to the employment of any person by the
Company, or any bonus, deferred compensation, pension, profit sharing, stock
option, employee stock purchase, retirement or other employee benefit plan,
(b) any agreement, indenture or other instrument which contains restrictions
with respect to payment of dividends or any other distribution in respect of
its capital stock, (c) any agreement, contract or commitment relating to
capital expenditures, (d) any loan or advance to, or investment in, any
individual, partnership, joint venture, corporation, trust, unincorporated
organization, government or other entity (each a "Person") or any agreement,
contract or commitment relating to the making of any such loan, advance or
investment, (e) any guarantee or other contingent liability in respect of any
indebtedness or obligation of any Person (other than the endorsement of
negotiable instruments for collection in the ordinary course of business), (f)
any management service, consulting or any other similar type contract (g) any
agreement, contract or commitment limiting the freedom of the Company to
engage in any line of business or to compete with any Person, or (h) any
agreement, contract or commitment not entered into in the ordinary course of
business.
2.7. Restrictive Documents. Neither the Company nor the Stockholder
is subject to, or a party to, any charter, by-law, mortgage, lien, lease,
license, permit, agreement, contract, instrument, law, rule, ordinance,
regulation, order, judgment or decree, or any other restriction of any kind or
character, which materially and adversely affects the business practices,
operations or condition of the Company or any of its assets or property, or
which would prevent consummation of the transactions contemplated by this
Agreement, compliance by the Stockholder with the terms, conditions and
provisions hereof or the continued operation of the Company's business after
the date hereof or the Closing Date (as hereinafter defined) on substantially
the same basis as heretofore operated or which would restrict the ability of
the Company to acquire any property or conduct business in any area.
2.8. Litigation. Except as set forth in Schedule 2.8 attached hereto,
there is no action, suit, proceeding at law or in equity, arbitration or
administrative or other proceeding by or before any governmental or other
instrumentality or agency, pending, or, to the best knowledge, information and
belief of the Stockholder or the Company, threatened, against or affecting the
Company, or any of its properties or rights which could materially and
adversely affect the right or ability of the Company to carry on its business
as now conducted, or which could materially and adversely affect the
condition, whether financial or otherwise, or properties of the Company. The
Company is not subject to any judgment, order or decree entered in any lawsuit
or proceeding which may have a material adverse effect on any of its
operations, business practices or on its ability to acquire any property or
conduct business in any area.
2.9. Taxes. The Company has not filed, nor has it been required to
file, any federal, state, local or foreign tax returns and tax reports. There
are no outstanding agreements or waivers extending the statutory period of
limitation applicable to any tax return of the Company.
2.10. Liabilities. The Company has no outstanding claims, liabilities
or indebtedness, contingent or otherwise, except as set forth in the Balance
Sheet or referred to in the footnotes thereto, other than liabilities incurred
subsequent to the Balance Sheet Date in the ordinary course of business not
involving borrowings by the Company.
2.11. Compliance with Laws. The Company has materially complied with
each, and is not in material violation of any, law, ordinance, or governmental
or regulatory rule or regulation, whether federal, state, local or foreign, to
which the Company's business, operations, assets or properties is subject
(collectively, "Regulations").
2.12. Employees; Compensation; Benefit Plans. The Company has never
had any employees, has never paid compensation to any person as an employee,
agent, consultant or otherwise, and has never been party to or maintained a
plan which is subject to the Employee Retirement Income Security Act of 1974,
as amended, or any rules of the Internal Revenue Service or the United States
Department of Labor.
2.13. Banking Arrangements. The Company has never maintained an
account with a bank or other financial institution.
2.14. Brokers. Neither the Company nor the Stockholder has made any
agreement or taken any action which may cause anyone to become entitled to a
commission as a result of the transactions contemplated by this Agreement.
2.15. Full Disclosure. No representation or warranty by the Company
or the Stockholder contained in this Article II and no statement contained in
any certificate furnished or to be furnished pursuant hereto to Purchaser by
or on behalf of the Company or Stockholder at or before the Closing Date or in
connection with the transactions contemplated hereby contains or at the
Closing Date will contain any untrue statement of a material fact, or omits or
at the Closing Date will omit to state a material fact necessary to provide
Purchaser with material information as to the Company and its affairs or as to
the Stock.
2.16. Copies of Documents. The Stockholder caused to be made
available for inspection and copying by the Purchaser and its advisers, true,
complete and correct copies of all documents referred to in this Article II or
in any Schedule attached hereto.
ARTICLE III
REPRESENTATIONS OF THE PURCHASER
The Purchaser represents, warrants and agrees to and with the Company
and the Stockholder as follows:
3.1. Organization and Qualification; Corporate Power. Purchaser (i)
is a corporation duly incorporated, validly existing and in good standing
under the laws of the State of New York and (ii) has the corporate power,
holds all Permits necessary, and is in all material respects entitled, to
carry on its business as now being conducted. Purchaser is qualified to do
business as a foreign corporation in all jurisdictions in which the location
of the properties owned or leased by it or the nature of its business makes
necessary such qualification, except for such jurisdictions in which the
failure to be so qualified would not have a material adverse effect on the
business, properties, financial condition or results of operations of
Purchaser (an "Purchaser Material Adverse Effect").
3.2. Capitalization. Purchaser has the duly authorized and
outstanding capitalization set forth under the caption "Capitalization" in
Purchaser's Amended And Restated Confidential Private Placement Memorandum
dated October 27, 1997, copies of which have been provided to the Stockholder
(the "PPM"). Other than as described in the PPM, there are not outstanding any
options or rights to purchase or otherwise acquire from Purchaser, or any
commitment of any character of Purchaser to issue, any shares of its capital
stock or any securities or obligations convertible into or exchangeable for,
or otherwise entitling any person to acquire from Purchaser, any shares of its
capital stock. The currently outstanding shares of Purchaser's capital stock
have been duly authorized and are validly issued, fully paid and
non-assessable and have not been issued in violation of the preemptive rights
(whether by statute or agreement) of any security holder of Purchaser. The
shares issuable upon exercise of the Purchase Option (the "Purchase Option
Shares") and the Options (the "Option Shares") will, when issued in accordance
with the terms of the Purchase Option and Options, respectively, be duly
authorized, validly issued and outstanding and will be fully paid and
non-assessable and will not have been issued in violation of the preemptive
rights (whether by statute or agreement) or any security holder of Purchaser.
3.3. Corporate Power as to this Agreement. Purchaser has the
corporate power to execute and deliver this Agreement, the Purchase Option,
the Options and the Employment Agreement attached hereto as Exhibit B, to
perform its obligations hereunder and thereunder and to consummate the
transactions contemplated hereby and thereby.
3.4. Authorization and Validity of Agreement. The execution and
delivery of this Agreement, the Purchase Option, the Options and the
Employment Agreement by Purchaser and the consummation by it of the
transactions contemplated hereby and thereby have been duly authorized by all
necessary or appropriate corporate action. This Agreement has been duly
executed and delivered by Purchaser and, assuming it constitutes a valid and
binding obligation of the Company and the Stockholder, constitutes a valid and
binding obligation of Purchaser, enforceable against Purchaser in accordance
with its terms. The Purchase Option, the Options and the Employment Agreement,
when executed and delivered, shall each have been duly executed and delivered
by Purchaser and will constitute a valid and binding obligation of Purchaser
enforceable against it in accordance with its terms.
3.5. No Violation of Law or Default by Execution and Performance of
this Agreement. The execution, delivery and performance of this Agreement, the
Purchase Option, the Options and the Employment Agreement by Purchaser will
not violate any applicable law or constitute a default by Purchaser or result
in a right of acceleration, termination or similar right of any party (or
will, but for the passage of time or the giving of notice, constitute a
default by Purchaser or result in such a right of acceleration, termination or
similar right of any party) under the Articles of Incorporation or bylaws of
Purchaser or under any contract, agreement, license or instrument to which it
is a party.
3.6. Approvals and Consents. No approval, consent or authorization
of, or declaration or filing with, any governmental or judicial authority or
any other person is required in connection with the execution and delivery of
this Agreement, the Purchase Option, the Options and the Employment Agreement
by Purchaser or the performance by Purchaser of its obligations hereunder or
thereunder or the consummation by Purchaser of the transactions contemplated
hereby or thereby.
3.7. No Undisclosed Liabilities. As at June 30, 1997, Purchaser had
no material commitment, liability or obligation of any nature, whether due or
to become due, absolute or contingent, including any liability for taxes or
interest or penalties relating thereto in respect of or measured by the income
of Purchaser for any period prior to such date, except to the extent reflected
or reserved against in the balance sheet dated such date and included in the
quarterly report on Form 10-QSB for the quarter ended such date filed by
Purchaser with the U.S. Securities and Exchange Commission ("SEC") or as
disclosed in the PPM or this Agreement. Purchaser does not know or have any
reasonable ground to know of any basis for the assertion against Purchaser of
any liability not fully reflected or reserved against in such balance sheet,
except for (i) liabilities arising since the date thereof in the ordinary
course of business and (ii) other liabilities disclosed in the PPM or this
Agreement. The date June 30, 1997 and the Purchaser balance sheets referred to
above are referred to herein, respectively, as the "Purchaser Balance Sheet
Date" and the "Purchaser Balance Sheet."
3.8. No Material Changes. Except as set forth on the Schedule of
Material Changes or as otherwise described or referred to in the PPM, since
the Purchaser Balance Sheet Date, there has not been:
(a) any change in the financial condition, assets,
liabilities, business, properties or results of operations of Purchaser,
except changes in the ordinary course of business, none of which individually
or in the aggregate has had an Purchaser Material Adverse Effect;
(b) any strike, lockout or any similar event or condition of
any character involving employees of Purchaser materially adversely affecting
the business, financial condition or results of operations of such
corporation;
(c) a failure by Purchaser to maintain in full force and
effect all policies of insurance in effect on the Purchaser Balance Sheet
Date, or any renewals or replacements thereof, or to give any notice or
present any claim under any such policy when due;
(d) a sale or transfer by Purchaser of any of its assets or
liabilities other than in the ordinary course of its business;
(e) any agreement or arrangement to which Purchaser is a
party granting to any person any right to purchase any of the assets of
Purchaser other than in the ordinary course of business; or
(f) any failure or refusal by Purchaser to pay any of its
obligations, including obligations to vendors and persons providing goods or
services to it; or
(g) any failure or refusal by Purchaser to make, in a timely
manner, all filings and declarations with and notices to governmental
authorities required to be made in connection with the conduct of its
business.
3.9. Tax Returns, Reports to Taxing Authorities, Audits and Tax
Payments. Except as otherwise set forth in the Schedule of Tax Matters or as
described or referred to in the PPM, Purchaser has filed with the appropriate
governmental agencies, domestic and foreign, all material tax returns and
reports required to be filed by it. All liabilities for taxes shown on
federal, state and other tax returns filed by or on behalf of Purchaser, or
arising by reason of any government review thereof, or otherwise due to be
paid, have been paid or provided for in the Purchaser Balance Sheet, and all
federal, state and other taxes for periods subsequent to the period covered by
such returns up to the Purchaser Balance Sheet Date have been paid or
reflected and reserved against in full in such balance sheet.
3.10. Litigation. Except as set forth in the Schedule of Litigation
or described or referred to in the PPM, there is no litigation, proceeding or
investigation pending or, to the knowledge of Purchaser, threatened against or
affecting any property of Purchaser, whether or not fully covered by
insurance.
3.11. Brokers. Purchaser has not made any agreement or taken any
action which may cause anyone to become entitled to a commission as a result
of the transactions contemplated by this Agreement.
ARTICLE IV
CONDUCT OF BUSINESS; EXCLUSIVE DEALING
4.1. Conduct of Business of the Company. From and after the date
hereof to the Closing Date, the Stockholder shall cause the Company to conduct
its operations only according to its ordinary and usual course of business.
Prior to the Closing Date, except as may be first approved by the Purchaser or
as is otherwise permitted or required by this Agreement, the Stockholder will
cause (i) the Company's Certificate of Incorporation and By-Laws to be
maintained in their form on the date of this Agreement, (ii) the Company to
refrain from making any bonus, pension, retirement or insurance payment or
arrangement to or with any such persons and (iii) the Company to refrain from
entering into any contract or commitment.
4.2. Exclusive Dealing. During the period from the date of this
Agreement to the Closing Date, the Stockholder shall not, and shall cause the
Company to refrain from taking any action to, directly or indirectly,
encourage, initiate engage in discussions or negotiations with, or provide any
information to, any Person, other than the Purchaser, concerning any purchase
of the Stock or any merger, sale of substantial assets or similar transaction
involving the Company.
4.3. Update Schedules. The Stockholder shall promptly disclose to
Purchaser any information contained in his and the Company's representations
and warranties or the Schedules which, because of an event occurring after the
date hereof, is incomplete or is no longer correct as of all times after the
date hereof until the Closing Date; provided, however, that none of such
disclosures shall be deemed to modify, amend or supplement representations and
warranties of the Stockholder and the Company or the Schedules hereto for the
purposes of Article V hereof, unless Purchaser shall have consented thereto in
writing.
ARTICLE V
CONDITIONS TO PURCHASER'S OBLIGATIONS
5.1. Conditions to Purchaser's Obligations. The purchase of the Stock
by Purchaser on the Closing Date is conditioned upon satisfaction, on or prior
to such date, of the following conditions:
(a) Good Standing and Other Certificates. The Stockholder
shall have delivered to the Purchaser (i) copies of the Company's charter,
including all amendments thereto, in each case certified by the Secretary of
State or other appropriate official of its jurisdiction of incorporation, (ii)
a certificate from the Secretary of State or other appropriate official of
their respective jurisdictions of incorporation to the effect that each of the
Company is in good standing or subsisting in such jurisdiction, and (iii) a
copy of the By-Laws of the Company, certified by the Secretary of the Company
as being true and correct and in effect on the Closing Date.
(b) No Material Adverse Change. Prior to the Closing Date,
there shall be no material adverse change in the assets or liabilities, the
business or condition, financial or otherwise, the results of operations, or
prospects of the Company.
(c) Truth of Representations and Warranties. The
representations and Warranties of the Stockholder contained in this Agreement
or in any Schedule attached hereto shall be true and correct on and as of the
Closing Date with the same effect as though such representations and
Warranties had been made on and as of such date, and the Stockholder shall
have delivered to the Purchaser a certificate, dated the Closing Date, to such
effect.
(d) Performance of Agreements. All of the agreements of the
Stockholder to be performed on or before the Closing Date pursuant to the
terms hereof shall have been duly performed, and the Stockholders shall have
delivered to the Purchaser a certificate, dated the Closing Date, to such
effect.
(e) No Threatened or Pending Litigation. No suit, action or
other proceeding, or injunction or final judgment relating thereto, shall be
threatened or be pending before any court or governmental or regulatory
official, body or authority in which it is sought to restrain or prohibit or
to obtain damages or other relief in connection with this Agreement or the
consummation of the transactions contemplated hereby, and no investigation
that might result in any such suit, action or proceeding shall be pending or
threatened.
(f) Documents to be Delivered on the Closing Date. On the
Closing Date, Company shall deliver to Purchaser: (i) copies of the Allegheny
Agreements duly executed by all parties thereto other than Purchaser, (ii)
certificates representing the Stock duly endorsed in blank by the Stockholder,
and (iii) the Employment Agreement attached hereto as Exhibit B executed by
Stockholder.
(g) Proceedings. All proceedings to be taken in connection
with the transactions contemplated by this Agreement and all documents
incident thereto shall be satisfactory in form and substance to the Purchaser
and its counsel, and the Purchaser shall have received copies of all such
documents and other evidences as they or their counsel may reasonably request
in order to establish the consummation of such transactions and the taking of
all proceedings in connection therewith.
(h) Closing of Offering. There shall have been an Initial
Closing of the Offering (as those terms are defined in the PPM), which Initial
Closing is intended to occur simultaneously with the Closing hereunder.
ARTICLE VI
CONDITIONS TO THE STOCKHOLDER'S AND COMPANY'S OBLIGATIONS
6.1. Conditions to the Stockholder's and Company's Obligations. The
sale of the Stock by the Stockholder on the Closing Date is conditioned upon
satisfaction, on or prior to such date, of the following conditions:
(a) Truth of Representations and Warranties. The
representations and warranties of the Purchaser contained in this Agreement
shall be true and correct on and as of the Closing Date with the same effect
as though such representations and warranties had been made on and as of such
date, and Purchaser shall have delivered to the Stockholder a certificate,
dated the Closing Date, to such effect.
(b) Performance of Agreements. All of the agreements of the
Purchaser to be performed on or before the Closing Date pursuant to the terms
hereof shall have been duly performed, and the Purchaser shall have delivered
to the Stockholder a certificate, dated the Closing Date, to such effect.
(c) No Material Adverse Change. Prior to the Closing Date,
there shall be no material adverse change in the assets or liabilities, the
business or condition, financial or otherwise, the results of operations, or
prospects of the Purchaser.
(d) No Threatened or Pending Litigation. No suit, action or
other proceeding, or injunction or final judgment relating thereto, shall be
threatened or be pending before any court or governmental or regulatory
official, body or authority in which it is sought to restrain or prohibit or
to obtain damages or other relief in connection with this Agreement or the
consummation of the transactions contemplated hereby, and no investigation
that might result in any such suit, action or proceeding shall be pending or
threatened.
(e) Documents to be Delivered on the Closing Date. On the
Closing Date, Company shall deliver to Purchaser: (i) copies of the Allegheny
Agreements duly executed by all parties thereto other than Purchaser, and the
Employment Agreement attached hereto as Exhibit B executed by Purchaser.
(f) Proceedings. All proceedings to be taken in connection
with the transactions contemplated by this Agreement and all documents
incident thereto shall be reasonably satisfactory in form and substance to the
Stockholder and his counsel, and the Stockholder shall have received copies of
all such documents and other evidences as it or its counsel may reasonably
request in order to establish the consummation of such transactions and the
taking of all proceedings in connection therewith.
(g) Closing of Offering. There shall have been an Initial
Closing of the Offering (as those terms are defined in the PPM), which Initial
Closing is intended to occur simultaneously with Closing hereunder.
ARTICLE VII
SURVIVAL OF REPRESENTATIONS; INDEMNITY; SET-OFF
7.1. Survival of Representations. The respective representations and
warranties of the Stockholder, the Company and the Purchaser contained in this
Agreement or in any Schedule attached hereto shall survive the purchase and
sale of the Stock contemplated hereby for one (1) year.
7.2. Indemnification.
(a) The Stockholder agrees to indemnify and hold the
Purchaser and its officers, directors and agents harmless from damages, losses
or expenses (including, without limitation, reasonable counsel fees and
expenses) in excess of $50,000 in the aggregate, suffered or paid, directly or
indirectly, through application of the Purchaser's assets, as a result of or
arising out of the failure of any representation or warranty made by the
Stockholder or the Company in this Agreement or in any Schedule attached
hereto to be true and correct in all material respects as of the date of this
Agreement and as of the Closing Date.
(b) The Purchaser agrees to indemnify and hold the
Stockholder harmless from damages, losses or expenses (including, without
limitation, reasonable counsel fees and expenses) in excess of $50,000, in the
aggregate, suffered or paid, directly or indirectly by Stockholder, as a
result of or arising out of the failure of any representation or warranty made
by the Purchaser in this Agreement to be true and correct in all material
respects as of the date of this Agreement and as of the Closing Date.
(c) The obligations to indemnify and hold harmless pursuant
to this Section 7.2 shall survive the consummation of the transactions
contemplated by this Agreement.
ARTICLE VIII
MISCELLANEOUS
8.1. Governing Law. The interpretation and construction of this
Agreement, and all matters relating hereto, shall be governed by the laws of
the Commonwealth of Pennsylvania applicable to agreements executed and to be
performed solely within such Commonwealth.
8.2. Jurisdiction; Agents for Service of Process. Any judicial
proceeding brought against any of the parties to this Agreement on any dispute
arising out of this Agreement or any matter related hereto may be brought in
the courts of the Commonwealth of Pennsylvania, or in the United States
District Court for the Eastern District of Pennsylvania, and, by execution and
delivery of this Agreement, each of the parties to this Agreement accepts the
exclusive jurisdiction of such courts, and irrevocably agrees to be bound by
any judgment rendered thereby in connection with this Agreement.
8.3. Press Releases. Except as required by applicable law, none of
the parties hereto shall give notice to any third parties or otherwise make
any public statement or releases concerning this Agreement or the transactions
contemplated hereby without obtaining the prior written consent of Purchaser
as to the contents and manner of presentation and publication thereof, which
consent shall not be unreasonably withheld.
8.4. Waiver. The Stockholder, on the one hand, or Purchaser, on the
other, may by an instrument in writing executed by them or it in the same
manner as the Agreement (i) extend or waive the time for performance of any of
the agreements of the others; (ii) waive any inaccuracies in representations
or warranties by the other parties contained herein or in any document
delivered pursuant hereto; and (iii) waive the satisfaction or fulfillment of
any condition the nonsatisfaction or nonfulfillment of which is a condition to
the right of the parties so waiving to refuse to Close or terminate this
Agreement.
8.5. Parties in Interest. This Agreement may not be transferred,
assigned, pledged or hypothecated by any party hereto, other than by operation
of law. This Agreement shall be binding upon and shall inure to the benefit of
the parties hereto and their respective heirs, executors, administrators,
successors and assigns.
8.6. Counterparts. This Agreement may be executed in any number of
counterparts and any party hereto may execute any such counterpart, each of
which when executed and delivered shall be deemed to be an original and all of
which counterparts taken together shall constitute but one and the same
instrument. This Agreement shall become binding when one or more counterparts
taken together shall have been executed and delivered by the parties. It shall
not be necessary in making proof of this Agreement or any counterpart hereof
to produce or account for any of the other counterparts.
8.7. Headings, Gender and "Person". All section headings contained in
this Agreement are for convenience of reference only, do not form a part of
this Agreement and shall not affect in any way the meaning or interpretation
of this Agreement. Words used herein, regardless of the number and gender
specifically used, shall be deemed and construed to include any other number,
singular or plural, and any other gender, masculine, feminine or neuter, as
the context requires. Any reference to a "person" herein shall include an
individual, firm, corporation, partnership, trust, governmental authority or
body, association, unincorporated organization or any other entity.
8.8. Schedules. All Schedules referred to herein are intended to be
and hereby are specifically made a part of this Agreement.
8.9. Severability. Any provision of this Agreement which is invalid
or unenforceable in any jurisdiction shall be ineffective to the extent of
such invalidity or unenforceability without invalidating or rendering
unenforceable the remaining provisions hereof, and any such invalidity or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
8.10. No Benefit To Others. The representations, warranties,
covenants and agreements contained in this Agreement are for the sole benefit
of the parties hereto and their heirs, executors, administrators, legal
representatives, successors and assigns, and they shall not be construed as
conferring any rights on any other persons.
8.11. Notices. Any notice, request, demand, waiver, consent, approval
or other communication which is required or permitted hereunder shall be in
writing and shall be deemed given only if delivered personally or sent by a
telegram or by registered or certified mail, postage pre-paid, as follows:
If to Purchaser, to:
Panax Pharmaceutical Company, Ltd.
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: President
If to Stockholder or Company, to:
Xxxxxxx X. Xxxxx, M.D., Ph.D.
000 Xxxxxxx Xxxxxx
Xxxx Xxxxxx, XX 00000
or to such other address as the addressee may have specified in a notice duly
given to the sender as provided herein. Such notice, request, demand, waiver,
consent, approval or other communication will be deemed to have been given as
of the date so delivered, telegraphed or mailed.
8.12. Entire Agreement. This Agreement, including the other documents
referred to herein which form a part hereof, contains the entire understanding
of the parties hereto with respect to the subject matter contained herein and
therein. This Agreement supersedes all prior agreements and understandings
between the parties with respect to such subject matter.
8.13. Amendments. This Agreement may not be changed orally, but only
by an agreement in writing signed by Purchaser and the Stockholder (subject to
the following). Any provision of this Agreement can be waived, amended,
supplemented or modified by agreement of Purchaser and the holders or former
holders of a majority of the shares of Stock. Action by the holders or former
holders of a majority of the shares of Stock pursuant to this Section 8.13
shall be binding for all purposes upon all of the Stockholders.
IN WITNESS WHEREOF, the Purchaser, the Company and the Stockholder
have executed this Agreement, all as of the day and year first above written.
PANAX PHARMACEUTICAL COMPANY, LTD.
By:
---------------------------------------
Name:
Title:
SANGEN PHARMACEUTICAL COMPANY
By:
---------------------------------------
Name:
Title:
STOCKHOLDER:
------------------------------------------
XXXXXXX X. XXXXX
SCHEDULE 2.6
Letter Agreement dated August 26,1997 between Sangen Pharmaceutical Company,
Inc. and Allegheny University of the Health Sciences, including the documents
referred to therein and attached thereto.
SCHEDULE 2.8
Drs. Xxxxx Xxxxxx and Xxxx Xxxxxx previously threatened litigation against
Sangen regarding Xx. Xxxxxx'x alleged rights with respect to licensing certain
technology. Purchaser has been provided with copies of the correspondence
relating to this claim and threat. There has been no communication between
Sangen or Xx. Xxxxx and either of Drs. Xxxxxx or Silver since the first week
in June, 1997.
