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Exhibit 10.5
ASSET PURCHASE AGREEMENT
by and among
THE EXOREX COMPANY, LLC
BIOGLAN PHARMA PLC
MEDICIS PHARMACEUTICAL CORPORATION
and
IMX PHARMACEUTICALS, INC.
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Dated as of June 29, 1999
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TABLE OF CONTENTS
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Page
ARTICLE I DEFINITIONS..........................................................1
ARTICLE II SALE AND PURCHASE; PURCHASE PRICE...................................3
Section 2.1 Sale and Purchase of Assets...................................3
Section 2.2 Purchase Price................................................4
Section 2.3 Form of Payment...............................................4
Section 2.4 Assumption of Obligations.....................................4
ARTICLE III CLOSING............................................................4
Section 3.1 Closing.......................................................4
Section 3.2 Closing Deliveries of the LLC.................................4
Section 3.3 Closing Deliveries of Bioglan.................................5
ARTICLE IV CONDITIONS TO CLOSING...............................................5
Section 4.1 Conditions to Bioglan's Obligations...........................5
Section 4.2 Conditions to the LLC's Obligations...........................6
ARTICLE V OTHER MATTERS........................................................6
Section 5.1 Use of Know-How...............................................6
Section 5.2 New Product Development.......................................7
Section 5.3 Risks Associated With the Products............................7
Section 5.4 Agreement to Distribute.......................................7
Section 5.5 Notification of Customers.....................................7
Section 5.6 Customer Orders...............................................7
Section 5.7 Accounts Receivable...........................................7
Section 5.8 Product Registration..........................................8
Section 5.9 Recall and Return of Products.................................9
Section 5.10 Dissolution of the LLC........................................9
Section 5.11 Payment of Royalties..........................................9
ARTICLE VI REPRESENTATIONS AND WARRANTIES......................................9
Section 6.1 Representations and Warranties of the LLC.....................9
Section 6.2 Representations and Warranties of Bioglan....................12
ARTICLE VII CONDUCT PRIOR TO CLOSING..........................................13
Section 7.1 Cooperation..................................................13
Section 7.2 Conduct of Business by LLC...................................13
Section 7.3 Review.......................................................13
Section 7.4 Contribution Margin..........................................13
ARTICLE VIII INDEMNIFICATION..................................................14
Section 8.1 Indemnification by Medicis and IMX...........................14
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Section 8.2 Indemnification by Bioglan...................................15
Section 8.4 Discontinuance of Operations.................................16
Section 8.5 Returns of Products..........................................16
ARTICLE IX GENERAL PROVISIONS.................................................16
Section 9.1 Survival of Representations and Warranties...................16
Section 9.2 Notices......................................................16
Section 9.3 Confidential Information.....................................17
Section 9.4 Amendment....................................................18
Section 9.5 Binding Effect...............................................18
Section 9.6 Press Releases...............................................18
Section 9.7 Expenses; Taxes..............................................18
Section 9.8 Headings.....................................................19
Section 9.9 Entire Agreement.............................................19
Section 9.10 Waiver.......................................................19
Section 9.11 Severability.................................................19
Section 9.12 Termination..................................................19
Section 9.13 Governing Law................................................19
Section 9.14 Counterparts.................................................20
Section 9.15 Shareholder Approval.........................................20
ARTICLE X ARBITRATION.........................................................20
Section 10.1 Submission to Arbitration....................................20
Section 10.2 Arbitrator and Rules of Arbitration..........................20
Section 10.3 Selection of Arbitrators.....................................20
Section 10.4 Procedure....................................................20
Section 10.5 Arbitration Costs............................................21
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SCHEDULES AND EXHIBITS
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Schedules
Schedule 1..............................................................Products
Schedule 2............................................................Trademarks
Exhibits
Exhibit A...................................................Form of Xxxx of Sale
Exhibit B..................................Form of Transition Services Agreement
Exhibit C.............................................Form of License Assignment
Exhibit D...........................................Form of Trademark Assignment
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Exhibit 10.5
PURCHASE AGREEMENT
PURCHASE AGREEMENT (the "Agreement") dated as of this 29th day of June 1999, by
and among THE EXOREX COMPANY, LLC, a Delaware limited liability company (the
"LLC"), BIOGLAN PHARMA PLC, a company incorporated under the laws of England and
Wales under company registration number 1779870 ("Bioglan"), MEDICIS
PHARMACEUTICAL CORPORATION ("Medicis") and IMX PHARMACEUTICALS, INC. ("IMX").
W I T N E S S E T H:
WHEREAS, Medicis and Bioglan have entered into an Asset Purchase Agreement
(the "Asset Purchase Agreement") dated as of June 29, 1999 whereby Medicis has
agreed to sell to Bioglan and Bioglan has agreed to purchase from Medicis all of
Medicis' right, title and interest in, to and under the Purchased Assets (as
defined therein);
WHEREAS, in connection with the transactions contemplated by the Asset
Purchase Agreement the parties thereto have conditioned execution of the Asset
Purchase Agreement on the execution of this Agreement.
NOW, THEREFORE, in consideration of the premises and of the mutual
agreements contained herein, the parties hereby agree as follows:
ARTICLE I
DEFINITIONS
In this Agreement the following terms shall have the following meanings:
"Affiliate" means any person, firm, corporation or other business entity,
directly or indirectly controlling, controlled by or under direct or indirect
common control with another person. A person shall be deemed to control another
person if such person possesses, directly or indirectly, the power to direct or
cause the direction of the management and policies of such entity, whether
through ownership of voting securities, by contract or otherwise.
"Business" means the development, manufacture, marketing and sale of the
Exorex Product Line and the related telephone product information and ordering
services provided to customers and distributors and product fulfillment center.
"Contribution Margin" means the amount equal to Net Sales less (i) all
reasonable charges from June 1, 1999 to the Closing for overhead directly
associated with the Products and the direct and indirect cost of goods (absent
the cost of Inventory paid at the Closing Date by Bioglan), and (ii) returns
from the period from June 1, 1999 to the Closing.
"Disclosure Letter" means the disclosure letter as of the date hereof from
the LLC to Bioglan relating to the representations and warranties set out in
Section 6.1.
"Exorex Product Line" means all skin care products developed by the LLC
for the treatment of and relief from psoriasis or other dermatological
conditions including, without
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limitation, shampoos and cream products and marketed under the trademark or
tradename "Exorex," including without limitation the Products listed on Schedule
1.
"Know-How" means the information known to the LLC relating solely and
uniquely to the formulae, manufacturing processes, customer lists, marketing and
advertising rights and promotional materials, technology and testing data for
the Products.
"Products" means the pharmaceutical products which are set forth on
Schedule 1.
"Net Sales" means the gross amount invoiced by the LLC and its Affiliates
to third parties on all sales of Products and any improvements (as defined in
the License Agreement), less deductions for: (i) sales taxes, value-added taxes
and excise taxes, tariffs, import or export duties, and duties paid or allowed
by a selling party and any other governmental charges imposed upon the import,
use or sale of such Products (except income taxes of the LLC, its Affiliates and
sublicensees) which are included in the gross amount invoiced; (ii) allowed
customary trade and quantity discounts (such discounts not to exceed 10% of the
sales price) and sales discounts (as defined in accordance with GAAP, such
discounts not to exceed 5% of the sales price); (iii) transportation, bulk
packaging, handling and freight charges (such charges not to exceed 3% of the
sales price) and reasonable and customary insurance where such are separately
stated as part of the sales price and are included in the gross amount invoiced;
and (iv) allowances and credits to its Affiliates or sublicensees which shall be
excluded from the computation of Net Sales, but Net Sales shall include
subsequent sales to third parties by such Affiliates or sublicensees. For
purposes of determining Net Sales, a sale shall be deemed to have occurred when
the Products have been shipped by the LLC, its Affiliates or a sublicensee.
"Trademarks" means the trademarks listed in Schedule 2 hereto together
with the goodwill symbolized by such trademarks.
"Warranties" means the warranties and representations of the LLC set out
in Section 6.1.
The following terms have the meanings defined for such terms in the
Sections set forth below:
Term Section
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Agreement.............................................................Recitals
Asset Purchase Agreement..............................................Recitals
Assumed Liabilities........................................................2.4
Award.....................................................................10.4
Basket..................................................................8.3(e)
Xxxx of Sale ..........................................................3.2 (a)
Bioglan...............................................................Recitals
Closing....................................................................3.1
Closing Date...............................................................3.1
Excluded Assets............................................................2.1
GAAP....................................................................6.1(g)
Hearing...................................................................10.4
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IMX...................................................................Recitals
Indemnified Party.......................................................8.3(a)
Indemnifying Party......................................................8.3(a)
Inventory..................................................................2.2
Joint Notice...............................................................5.5
License Agreement..........................................................2.1
LLC...................................................................Recitals
Losing Party..............................................................10.5
Losses.....................................................................8.1
Material Adverse Effect.................................................6.1(d)
Medical Affairs Liaison.................................................5.8(d)
Medicis...............................................................Recitals
New Authorizations......................................................5.8(a)
Purchase Price.............................................................2.2
Purchased Assets...........................................................2.1
Required Consents.......................................................4.1(c)
Successful Party..........................................................10.5
ARTICLE II
SALE AND PURCHASE; PURCHASE PRICE
Section 2.1 Sale and Purchase of Assets. Subject to the terms and
conditions set forth herein, and in reliance upon the representations and
warranties contained herein, the LLC will sell, assign, convey, transfer and
deliver to Bioglan or to the nominated Affiliate of Bioglan, and Bioglan will
purchase and acquire from the LLC the following assets of the LLC, including,
without limitation, (i) the Exorex Product Line in the United States, (ii) all
rights related to the Exorex Product Line in the United States, (iii) the Exorex
trademark, (iv) an assignment of the license by and between Pegasus Dermasearch
(Pty) Limited and Interderm Limited dated June 23, 1995 as subsequently amended
on September 18, 1995, September 1, 1996, January 15, 1998, and March [ ],
1998 (the "License Agreement") to the extent it relates to the Exorex Product,
(v) the helpline, including all employees of the Business and all obligations
relating to such employees, (vi) the Facility Agreement between the LLC and IMX
dated June 18, 1998, (vii) the Inventory (as defined herein), (viii) an amount
equal to the Contribution Margin to be paid pursuant to the Transition Services
Agreement, (ix) the Software License Agreement from IMX to LLC, dated as of June
18, 1998, and (x) all other ordinary course obligations, including obligations
and contracts related to distribution, sales and marketing obligations related
to the Business (the "Purchased Assets") except: (i) the New Product Agreement
between Medicis and IMX dated June 18, 1998; (ii) the non-Disclosure and
Invention Agreements entered into by (a) Adele Folk, dated as of June 18, 1998,
(b) Xxxx Xxxxxxxxxx, dated as of June 18, 1998, (c) Xxxx Xxxxxx, dated as of
June 18, 1998 and (d) Xxxx Xxxxxxx, dated as of June 18, 1998; (iii) the
Consulting, Confidentiality and Non-Compete Agreement between the LLC and IMX
dated June 18, 1998 ; (iv) the Exclusive Distribution Assignment Agreement
between IMX and the LLC, dated June 18, 1998; and (v) the Assignment
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and Assumption Agreement between IMX and the LLC, dated June 18, 1998 (the
"Excluded Assets").
Section 2.2 Purchase Price. In consideration for the sale,
assignment, conveyance, transfer and delivery of the Purchased Assets, Bioglan
will pay the LLC consideration as set forth in Section 2.2(a) of the Asset
Purchase Agreement and LLC's cost (less the sum of US $200,000) for all
inventory (the "Inventory") of the Products as of June 1, 1999 with a remaining
shelf life of no less than twelve (12) months as of June 1, 1999 (the "Purchase
Price") and in the manner herein and therein provided and the LLC hereby gives
its consent to the payment of the Purchase Price being satisfied in such manner.
The parties hereby agree that any Inventory with a shelf life of less than
twelve (12) months shall be transferred by the LLC to IMX. Medicis agrees to
accept payment of the balance of the sum due in respect of that portion of the
Inventory related to raw material and bulk inventory (after allowing for the sum
paid therefor on the Closing in accordance with Section 3.3(f)) on September 30,
1999.
Section 2.3 Form of Payment. Except as otherwise provided herein,
all payments made hereunder shall be made in United States Dollars by wire
transfer in immediately available funds to an account designated in writing by
Medicis to Bioglan.
Section 2.4 Assumption of Obligations. Subject to the terms and
conditions set forth herein, and in reliance upon the representations and
warranties contained herein, at the Closing, in consideration for the sale,
assignment, conveyance, transfer and delivery of the Purchased Assets to
Bioglan, the LLC will assign, convey and transfer to Bioglan, and Bioglan will
unconditionally assume and undertake to pay, perform and discharge, in a timely
manner and in accordance with the terms thereof, all liabilities related to or
arising out of the Purchased Assets as are incurred and become due at any time
following June 1, 1999 (collectively, the "Assumed Liabilities"). Without
limiting the generality of the foregoing, Bioglan hereby agrees to assume,
undertake and perform all obligations of the LLC under the Assumed Liabilities
to the extent such obligations arise or are to be performed after June 1, 1999.
ARTICLE III
CLOSING
Section 3.1 Closing. The consummation of the transactions
contemplated herein (the "Closing") shall take place within five (5) business
days of satisfaction of the conditions set forth in Article IV, or at such other
date and time as mutually agreed to by the parties (the "Closing Date").
Section 3.2 Closing Deliveries of the LLC. At the Closing, and
subject always to Section 9.15, the LLC shall execute (where appropriate) and
deliver to Bioglan:
(a) a Xxxx of Sale substantially in the form of Exhibit A attached
hereto, executed by the LLC;
(b) a Transition Services Agreement substantially in the form of
Exhibit B attached hereto, executed by the LLC, Medicis and IMX;
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(c) a Secretary's Certificate of the LLC setting forth copies of the
resolutions or other instruments authorizing this Agreement and the transactions
contemplated herein;
(d) an Officer's Certificate of the LLC as required under Section
4.1(b) hereof;
(e) a copy of all consents, approvals and authorizations as required
under Section 4.1(c) hereof;
(f) a License Assignment for the License Agreement substantially in
the form of Exhibit C attached hereto;
(g) a Trademark Assignment substantially in the form of Exhibit D
attached hereto;
(h) the Inventory, together with a receipt of payment for the sum
paid on account therefor pursuant to Section 3.3(f);
(i) a certified true copy of the License Agreement and all
amendments thereto; and
(j) such other documents as Bioglan shall reasonably request.
Section 3.3 Closing Deliveries of Bioglan. At the Closing, and
subject always to Section 9.15, Bioglan shall deliver to the LLC:
(a) a Transition Services Agreement substantially in the form of
Exhibit B attached hereto, executed by Bioglan;
(b) a Secretary's Certificate of Bioglan setting forth copies of the
resolutions or other instruments authorizing this Agreement and the transactions
contemplated herein;
(c) an Officer's Certificate of Bioglan as required under Section
4.2(a) hereof;
(d) a counterpart License Assignment for the License Agreement
substantially in the form of Exhibit C attached hereto;
(e) a counterpart Trademark Assignment substantially in the form of
Exhibit D attached hereto;
(f) an amount equal to the LLC's cost for the finished goods
included in the Inventory; and
(g) such other documents as the LLC shall reasonably request.
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ARTICLE IV
CONDITIONS TO CLOSING
Section 4.1 Conditions to Bioglan's Obligations. Bioglan's
obligation to consummate the transactions contemplated herein at the Closing are
subject to the fulfillment at or prior to the Closing of each of the following
conditions, the fulfillment of any of which may be waived, in whole or in part
or subject to conditions, by Bioglan:
(a) The completion by the LLC, Medicis and IMX of all acts necessary
to authorize their execution, delivery and performance of this Agreement and the
other agreements provided for herein, and the consummation of the transactions
contemplated herein and therein.
(b) All the representations and warranties (including the
disclosures made in the Disclosure Letter) of the LLC contained in this
Agreement being true and correct in all material respects as of the date of
execution of this Agreement and at the Closing Date and all of the agreements of
the LLC which are provided in this Agreement to be performed at or prior to the
Closing having been duly performed, and the LLC having complied with this
Agreement in all other material respects and the LLC having delivered to Bioglan
a certificate, dated as of the Closing Date, and signed by an executive officer
of the LLC, to the effect set forth in this Section 4.1(b).
(c) The LLC, Medicis and IMX having obtained all consents,
approvals, releases, discharges and authorizations necessary to be obtained on
the part of the LLC, Medicis and IMX to consummate the transactions contemplated
hereby, including without limitation, all necessary consents of shareholders,
mortgagees, lienholders, encumbrancers, assignees and licensors (pursuant to the
License Agreement) (the "Required Consents").
(d) The simultaneous consummation of the transactions contemplated
pursuant to the Asset Purchase Agreement.
Section 4.2 Conditions to the LLC's Obligations. The obligations of
the LLC to consummate the transactions contemplated at the Closing are subject
to the fulfillment at or prior to the Closing of each of the following
conditions, the fulfillment of any of which may be waived, in whole or in part
or subject to conditions, by the LLC:
(a) All the representations and warranties of Bioglan contained in
this Agreement being true and correct in all material respects as of the date of
execution of this Agreement and at the Closing Date and all of the agreements of
Bioglan which are provided in this Agreement to be performed at or prior to the
Closing Date having been duly performed, and Bioglan having complied with this
Agreement in all other material respects, and Bioglan having delivered to the
LLC a certificate, dated as of the Closing Date and signed by an executive
officer of Bioglan, to the effect set forth in this Section 4.2(a).
(b) The simultaneous consummation of the transactions contemplated
pursuant to the Asset Purchase Agreement.
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ARTICLE V
OTHER MATTERS
Section 5.1 Use of Know-How. Except as otherwise provided for in
this Agreement, after the Closing, the LLC shall not use the Know-How.
Furthermore, after the Closing the LLC shall not disclose the Know-How to any
third party, unless such disclosure is required by law or regulation.
Section 5.2 New Product Development. Notwithstanding anything in
this Agreement to the contrary, the transfer and assignment to Bioglan by the
LLC of the Purchased Assets shall not prevent the LLC, IMX or Medicis from
continuing to manufacture and sell other products included or expected to be
included in their current line or to use other trademarks owned by the LLC, IMX
or Medicis or restrict the rights of the LLC, IMX or Medicis to develop and sell
new products using the same active ingredients contained in the Products, but
using different formulations, or different presentations, and under different
product trademarks.
Section 5.3 Risks Associated With the Products. After the Closing
Date, subject to the terms of the Transition Services Agreement, Bioglan shall
bear the entire responsibility for and risk in the manufacture, distribution,
marketing and sale of the Products, including, subject to Section 8.5, those
associated with returns of Product sold by the LLC prior to June 1, 1999, and
compliance with all regulations and laws pertaining to the Products. The LLC
shall, for one year following the Closing Date, use its reasonable best efforts
to assist Bioglan in these matters, but they shall remain the sole
responsibility of Bioglan.
Section 5.4 Agreement to Distribute. In order to ensure continued
supply of the Products to customers following consummation of this Agreement,
the LLC hereby agrees to act as distributor of the Products for the earlier of
(i) a period of four (4) months from the consummation of this Agreement, or (ii)
until Bioglan gives written notice to the LLC that Bioglan has developed its own
distribution network. This period shall be extended, at the written request of
Bioglan, for a further two (2) months if, after using its reasonable best
efforts, Bioglan has been unable to develop its own distribution system at the
end of the four month period. Upon expiration of the period for which the LLC
shall distribute Products on behalf of Bioglan as set forth above, the LLC shall
return to Bioglan any inventory of the Products in the LLC possession as of the
date thereof.
Section 5.5 Notification of Customers. The LLC and Bioglan agree to
cooperate in the notification to customers of the transactions contemplated by
this Agreement. Neither the LLC nor Bioglan shall notify any customers of such
transactions without the written consent of the other. Such notification (the
"Joint Notice") shall be in such form as is reasonably satisfactory to Bioglan
and the LLC and shall also inform such customers of Bioglan's address.
Section 5.6 Customer Orders. The LLC agrees for a period of four (4)
months after the Closing Date to use its reasonable best efforts to forward to
Bioglan all customer orders or inquiries for the Products received after the
Closing as soon as practicable after receipt by the LLC. The LLC agrees that,
for a period of six (6) months from the Closing Date, it will inform
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any customers ordering the Products or requesting information about the
Products, that Bioglan is now supplying the Products and provide such customers
with Bioglan's address.
Section 5.7 Accounts Receivable.
(a) In the event that the LLC receives any payment relating to any
accounts receivable that accrued on or after the date on which the Transition
Services Agreement is terminated or expires, such payment will be the property
of, and will be immediately forwarded and remitted to Bioglan. The LLC will
promptly endorse and deliver to Bioglan any cash, checks or other documents
received by the LLC on account of any such accounts receivable and will advise
Bioglan of any counterclaims or set-offs that may arise subsequent to the
Closing Date with respect to such accounts receivable.
(b) In the event that Bioglan or any of Bioglan's Affiliates receive
any payment relating to any accounts receivable that accrued prior to the date
on which the Transition Services Agreement is terminated or expires, such
payment will be the property of, and will be immediately forwarded and remitted
to the LLC. Bioglan or any such Affiliates will promptly endorse and deliver to
the LLC any cash, checks or other documents received by Bioglan or any such
Affiliate on account of any such accounts receivable and will advise the LLC of
any counterclaims or set-offs that may arise subsequent to the Closing Date with
respect to such accounts receivable.
Section 5.8 Product Registration.
(a) After the Closing, Bioglan will initially market the Products
under the Authorizations, such Authorizations having been varied to permit the
same. Such distribution relationship shall continue until Bioglan obtains
regulatory authorization from the FDA to market the Products under its own
authorizations (the "New Authorizations").
(b) To permit Bioglan to distribute and sell the Products, Bioglan
shall, promptly following signature hereof at its own expense, file all
necessary instruments with the FDA to obtain a waiver to vary the LLC's
Authorizations to allow Bioglan to sell the Products.
(c) Bioglan shall, at its sole expense, file a product license
application with the FDA for each of the Products. The LLC shall, at its
expense, file all necessary instruments with the FDA to authorize Bioglan to
cross-refer to the data contained in the Authorizations in order for Bioglan to
obtain the New Authorizations.
(d) Within thirty (30) days after the Closing Date, the parties
shall each appoint a primary liaison (the "Medical Affairs Liaison") to
communicate with each other with regard to the actions and information required
pursuant to this Section 5.8 and shall notify the other of the name, address and
telephone number of the person so appointed.
(e) During the period that Bioglan is selling the Products under the
Authorizations, each party shall advise the other as set forth in (i) and (ii)
below of any adverse drug experience associated with the Products. In addition,
Bioglan shall report all adverse drug
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experience information it obtains, including that obtained from the LLC, to the
FDA as set forth in Section 5.8(f) below:
(i) Any adverse drug experience information obtained by a
party shall be reported to Bioglan's Medical Affairs Liaison, by
telephone or in writing (only by facsimile) within three (3)
business days after the first party's initial receipt of the
information; provided, however, that any report of a serious
unlabelled side effect or any report of a death shall be reported to
Bioglan's Medical Affairs Liaison within twenty-four (24) hours of
receipt of the information; and
(ii) The reports of adverse drug experience shall contain the
following information: (i) the date the report was received; (ii)
the name of the reporter; (iii) the address and telephone number of
the reporter; (iv) the patient details; (v) the suspected drug; (vi)
other concomitant therapy; (vii) a description of the adverse drug
experience; and (viii) any additional relevant information; provided
such information is obtainable through the use of reasonable efforts
and is not subject to any duty of non-disclosure or confidence.
(f) Bioglan shall report all adverse drug experience information
associated with the Products, including those received from the LLC under this
Section 5.8 to the FDA, in accordance with the laws and regulations of the
United States.
(g) After the Closing, Bioglan shall bear the entire responsibility
for the manufacture, distribution, advertising and sale of the Products and for
all actions required by the FDA and other governmental laws and regulations
relating to the manufacture, distribution, and use of the Products after June 1,
1999.
(h) Upon the grant to Bioglan of the New Authorizations, the LLC
agrees at its own expense to take all reasonably necessary steps to cancel,
transfer or assign forthwith at Bioglan's option its Authorizations in the
United States.
Section 5.9 Recall and Return of Products. During the period that
Bioglan is selling Products pursuant to the Authorizations, Bioglan shall, at
its cost, be responsible for all activities to be performed relating to any
recall or return of such Products and the LLC shall during such period promptly
notify Bioglan of all decisions and notifications of the FDA relating to the
Products.
Section 5.10 Dissolution of the LLC. Medicis shall dissolve the LLC
within eight (8) months of the Closing Date and shall not use the name Exorex in
connection with any of its Affiliates or any Products sold by Medicis or its
Affiliates. Medicis shall not infringe or seek to infringe on the Exorex
Trademark pursuant to applicable United States law.
Section 5.11 Payment of Royalties. The LLC agrees that it will pay
all royalties which accrued under the License Agreement prior to June 1, 1999 in
accordance with the terms of the License Agreement, failing which, Medicis will
pay the royalties on behalf of the LLC.
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ARTICLE VI
REPRESENTATIONS AND WARRANTIES
Section 6.1 Representations and Warranties of the LLC. Except as set
forth in the Disclosure Letter or Section 6.1(g) and Section 6.1(k), the LLC
hereby warrants to Bioglan as of the date hereof as follows:
(a) Ownership of LLC Interests. Prior to Closing, Medicis will own
100% of the LLC interests. Prior to Closing, no person will hold any membership
interest or any right to receive any income, profits, distributions or assets of
the LLC, other than Medicis. None of the LLC Interests were issued in violation
of any preemptive or similar rights.
(b) Organization. The LLC (i) is a corporation duly organized and
validly existing and in good standing under the laws of Delaware and (ii) has
all necessary corporate power and authority to own its properties and to conduct
its business, as currently conducted.
(c) Authorization. The execution and delivery of this Agreement and
the other agreements contemplated hereby, and the consummation of the
transactions contemplated hereby and thereby, are within the corporate power of
the LLC, Medicis and IMX and have been or will be, on or prior to the Closing
Date, duly authorized by all necessary corporate proceedings, if required, and
such agreements have been or will be, on or prior to the Closing, duly executed
and delivered by the LLC, Medicis and IMX.
(d) Execution and Delivery. Neither the execution of this Agreement
and the other agreements contemplated hereby nor the consummation of the
transactions contemplated herein and therein: (i) requires the LLC, Medicis or
IMX to obtain any approval, consent or withholding of objections on the part of
any regulatory or governmental body, (ii) will result in any violation or breach
of any term or provision of the LLC's Certificate of Formation or the
organizational documentation of Medicis or IMX; (iii) will constitute a default
under any material indenture, mortgage, deed of trust, license agreement or
other contract or agreement to which the LLC, Medicis or IMX is a party or to
which the LLC interests may be subject; or (iv) will violate any provision of
any judicial, governmental or administrative order, writ, injunction, award,
judgment or decree applicable to the LLC, Medicis or IMX which could result in a
material adverse effect in the condition, business or operations ("Material
Adverse Effect") of the LLC.
(e) Binding Obligation. As of the Closing, this Agreement and the
other agreements contemplated hereby will have been duly and validly authorized,
executed and delivered by the LLC, Medicis and IMX and, when duly executed and
delivered by Bioglan, will constitute valid and binding obligations of the LLC,
, Medicis and IMX enforceable against each of the LLC, Medicis and IMX in
accordance with their terms, except as such enforcement may be limited by
bankruptcy or other laws of general application affecting creditor rights or
general principles of equity or principles of public policy relating to
indemnification.
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(f) Broker. Except for Corporate Development Specialists, Inc.,
neither the LLC nor any officer, director or agent of the LLC has employed any
broker, finder, or agent with respect to this Agreement or the transactions
contemplated hereby.
(g) Gross Sales. Medicis represents and warrants that the amount of
gross sales, less returns, for the calendar year ended December 31 1998, and for
the calendar quarter ended March 31, 1999 as accounted for by the LLC in
accordance with United States generally accepted account principles ("GAAP"),
which has been provided by the LLC to Bioglan prior to the date of this
Agreement as contained in the Disclosure Letter, was correct in all material
respects. The LLC has also provided Bioglan in the Disclosure Letter with
information regarding shipments and returns for the period from April 1, 1999 to
May 31, 1999, which information Medicis represents and warrants was correct in
all material respects.
(h) Trademarks. The Trademarks are currently being used commercially
by the LLC and have been properly filed or registered with the U.S. Patent and
Trademark Office and are valid and in full force and effect as of the date of
execution of this Agreement.
Except as may be restricted or prohibited by any applicable law,
rule, regulation or decision, the LLC has the exclusive right to use, transfer
and assign, free and clear of any liens or encumbrances, the registrations for
the Trademarks.
To the LLC's knowledge, the manufacture, use or sale of the Products
by the LLC or the use of the Trademarks in the United States of America for the
sale of the Products does not infringe the rights of any third party including
inter alia intellectual property rights.
Except for any restriction or prohibition set forth in any
applicable law, rule, regulation, decision or other governmental action, the LLC
is not aware of any restriction or prohibition which would prevent or restrict
the disclosure of the Know-How to Bioglan hereunder.
(i) Adverse Drug Experiences. The LLC has informed Bioglan of all
material adverse drug experiences related to the Products of which it has
knowledge.
(j) License Agreement. The License Agreement is in full force and
effect, and a full and complete copy thereof including all amendments thereof
(if any), as duly executed by all parties, is attached to the Disclosure Letter.
There have been and are no other amendments, changes or waivers by either party
of any of the terms thereof, written or otherwise.
The LLC has the full legal right, power and authority to
convey the License Agreement.
The LLC has not assigned, sublicensed or granted, nor is there
otherwise outstanding, any material lien or encumbrance of any kind in, the
License Agreement.
The LLC is in compliance with all material terms of the
License Agreement. To the knowledge of the LLC, there are no counterclaims,
defenses or offsets
11
against any obligation of the LLC or any of its Affiliates to perform under the
License Agreement.
(k) Inventory. Medicis represents and warrants that the LLC has good
and valid title to the Inventory, free and clear of any material lien or
encumbrance, and has not sold or contracted to sell any of the Inventory other
than in the ordinary course of business.
Medicis represents and warrants that all Inventory to be sold
hereunder is in good and marketable condition and has a remaining shelf life as
of June 1, 1999 of not less than twelve (12) months and does not include any
patently damaged, obsolete, or outdated material. All Products sold by the LLC
after June 1, 1999 to the Closing Date or in Inventory as of the Closing Date
were manufactured in accordance with Good Manufacturing Practices, are
adequately packaged and labeled and in conformity with all applicable
authorizations.
(l) Litigation. There is no litigation, arbitration, proceeding,
governmental investigation, action or claims of any kind, pending or, to the
knowledge of the LLC, threatened, or facts which could reasonably be expected to
give rise thereto, by or against the LLC which would affect Bioglan as the
purchaser hereunder or relative to the License Agreements or the Products,
including, without limitation, regarding breach of express or implied warranty
or representation or failure to warn or relating to personal injury, property
damage or other liability arising from or caused by the Products.
(m) Contractual Obligations. There are no material obligations or
agreements between the LLC and either or both of Medicis and IMX except for
those obligations and agreements which are included in the Purchased Assets and
the Excluded Assets.
(n) Employees. The Disclosure Letter contains details of all
employees and consultants of the Business and their current salaries. There are
no written employment contracts with respect to the employees and consultants of
the Business.
(o) DISCLAIMER. OTHER THAN THOSE ARISING AS A RESULT OF A BREACH OF
THE REPRESENTATIONS AND WARRANTIES HERETO AND THE XXXX OF SALE, BIOGLAN HEREBY
WAIVES ANY AND ALL OTHER REPRESENTATIONS, WARRANTIES, DUTIES, AND GUARANTEES OF
ANY KIND WHATSOEVER, EXPRESS OR IMPLIED, STATUTORY OR OTHERWISE, CONCERNING THE
PURCHASED ASSETS OR THE VALUE, CONDITION, EFFECTIVENESS OR COMPLIANCE WITH
SPECIFICATION OF THE PRODUCTS, INCLUDING, BUT NOT LIMITED TO, ANY IMPLIED
WARRANTIES OF MERCHANTABILITY, FITNESS FOR ANY PARTICULAR PURPOSE, THE ABSENCE
OF OBLIGATIONS BASED ON STRICT LIABILITY IN TORT, OR THE QUALITY OF THE
MATERIALS OR WORKMANSHIP, AND BIOGLAN HEREBY WAIVES ANY AND ALL RIGHTS AND
REMEDIES IT MAY HAVE AGAINST MEDICIS RELATING TO ANY OF THE FOREGOING AND
ARISING BY LAW OR OTHERWISE OR WITH RESPECT TO LOSS OF USE, REVENUE OR PROFIT,
THE EXISTENCE OF ANY LATENT, INHERENT OR ANY OTHER DEFECT (WHETHER OR NOT
DISCOVERABLE), OR OTHER INCIDENTAL OR CONSEQUENTIAL DAMAGES.
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Section 6.2 Representations and Warranties of Bioglan. Bioglan
hereby represents and warrants to the LLC as of the date hereof as follows:
(a) Organization. Bioglan (i) is a public limited company duly
organized, validly existing under the Laws of England and Wales and (ii) has all
necessary power and authority to own its properties and to conduct business as
presently conducted.
(b) Authority. The execution and delivery of this Agreement and the
other agreements contemplated hereby, and the consummation of the transactions
contemplated hereby and thereby, are within the corporate power of Bioglan and
any relevant Affiliate of Bioglan, have been or will be, on or prior to the
Closing Date, duly authorized by all necessary corporate proceedings except for
shareholder approval, the obtaining of which shall be governed by and subject to
Section 7.5 of the Asset Purchase Agreement and such agreements have been or
will be, on or prior to the Closing, duly executed and delivered by Bioglan and
any relevant Affiliate of Bioglan.
(c) Execution and Delivery. Subject to the approval of the
shareholders of Bioglan at the shareholders' meeting as contemplated in Section
7.5 of the Asset Purchase Agreement, neither the execution of this Agreement and
the other agreements contemplated hereby nor the consummation of the
transactions contemplated hereby and thereby: (i) requires Bioglan to obtain the
approval, consent or withholding of objection on the part of any governmental
body; (ii) will result in any violation or breach of any term or provisions of
Bioglan's memorandum and articles of association; (iii) will constitute a
default under any indenture, mortgage, deed of trust, license, agreement, or
other contract or agreement to which Bioglan or any Affiliate of Bioglan that is
a party to any of the agreements contemplated hereby; or (iv) will violate any
provision of any judicial, governmental or administrative order, writ,
injunction, award, judgment or decree applicable to Bioglan or any Affiliate of
Bioglan that is a party to any of the agreements contemplated hereby which could
reasonably be expected to result in a Material Adverse Effect on Bioglan.
(d) Binding Obligation. Subject to the approval of the shareholders
of Bioglan at the shareholders' meeting as contemplated in Section 7.5 of the
Asset Purchase Agreement, as of the Closing, this Agreement and the other
agreements contemplated hereby will have been duly and validly authorized,
executed and delivered by Bioglan, and when duly executed and delivered by the
LLC, will constitute valid and binding obligations of Bioglan, enforceable
against Bioglan in accordance with their terms, except as such enforcement may
be limited by bankruptcy or other laws of general application affecting creditor
rights or general principles of equity or principles of public policy relating
to indemnification.
(e) Broker. Neither Bioglan nor any officer, director or agent of
Bioglan, has employed any broker or finder with respect to this Agreement or the
transactions contemplated hereby.
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ARTICLE VII
CONDUCT PRIOR TO CLOSING
Section 7.1 Cooperation. The parties agree to cooperate mutually and
make all reasonable efforts toward consummating the transactions contemplated
hereby and fulfilling the purposes of this Agreement prior to and following
Closing, including providing and executing such additional documentation and
communications as may be appropriate for such purposes.
Section 7.2 Conduct of Business by LLC. Upon execution of this
Agreement, the LLC shall not without the prior written consent of Bioglan take
any action out of the ordinary course of business in relation to the Products
prior to Closing nor will it do, procure or allow anything which may cause,
constitute or result in a breach of the Warranties. After the execution of this
Agreement through the Closing Date, the LLC shall provide Bioglan, its agents,
representatives and professional advisors reasonable access to all information
and facilities relating to the Purchased Assets, as reasonably requested by
Bioglan during normal business hours.
Section 7.3 Review. The LLC shall permit Bioglan's auditors to
inspect the LLC's records relating to sales of the Products to enable the said
auditors to adequately validate the financial receipts relating to the sales of
the Products (as required under the Listing Rules of the London Stock Exchange)
since January 1, 1998; provided, however, that the LLC shall have no liability
whatsoever in connection with the review described herein, unless the review
shall indicate the existence of a material breach of the Warranties.
Section 7.4 Contribution Margin. Medicis covenants that if the
Contribution Margin is less than zero (0), then Medicis shall pay to Bioglan an
amount equal to the deficit in the Contribution Margin. However, any payment
required to be made by Medicis to Bioglan under this Section 7.4 shall be
reduced by the total value of all returns received after June 1, 1999 by the LLC
from CVS, Xxxx Xxxxxx and Walgreens.
ARTICLE VIII
INDEMNIFICATION
Section 8.1 Indemnification by Medicis and IMX. Medicis and IMX,
jointly and severally, agree to indemnify, defend and hold harmless Bioglan (and
its directors, officers, employees, Affiliates, successors and assigns) from and
against all losses, personal injuries, liabilities, damages (other than
incidental or consequential), deficiencies, costs or expenses including, without
limitation, interest, penalties and reasonable attorneys' fees and disbursements
("Losses") of Bioglan and its Affiliates based upon, arising out of or otherwise
in respect of:
(a) any material inaccuracy in or material breach of, any
representation, warranty, covenant or agreement (other than with respect to the
covenant set forth in Section 7.3, for which the LLC shall have no liability,
unless the review shall indicate the existence of a material breach of the
Warranties) of the LLC contained in this Agreement.
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(b) any harm to any third party caused by any defect in the Products
manufactured, mandated, distributed, or sold by the LLC or any relevant
Affiliate, prior to June 1, 1999, or by any negligent or wrongful act of the LLC
or any relevant Affiliate prior to the Closing in connection with the
manufacture, distribution, advertising, or sale of the Products, or any failure
to comply with any regulation or statute in connection with the Products.
(c) failure of the LLC prior to the Closing Date to use its
reasonable best efforts to conduct its efforts under this Agreement at all times
in accordance with all applicable laws and regulations which may materially
affect the Products including without limitation the U.S. Foreign Corrupt
Practices Act.
Section 8.2 Indemnification by Bioglan. Bioglan agrees to indemnify,
defend and hold harmless the LLC (and its directors, officers, employees,
Affiliates, successors and assigns) from and against all Losses of the LLC based
upon, arising out of or otherwise in respect of:
(a) any material inaccuracy in or material breach of any
representation, warranty, covenant or agreement of Bioglan, any of its
Affiliates or sublicensees contained in this Agreement.
(b) any harm to any third party caused by any defect in the Products
manufactured, mandated, distributed or sold by Bioglan or any relevant Affiliate
after June 1, 1999 or by any negligent or wrongful act of Bioglan in connection
with the manufacture, distribution, advertising, or sale of the Products after
the Closing Date, or any failure after the Closing Date to comply with any
regulation or statute.
(c) failure of Bioglan to use its reasonable best efforts to conduct
its efforts under this Agreement at all times in strict accordance with all
applicable laws and regulations which may materially affect the Products
including without limitation the US Foreign Corrupt Practices Act.
Section 8.3 Procedure for Indemnification.
(a) If any legal proceeding shall be instituted, or any claim or
demand made, against an indemnifying party in respect of which an indemnifying
party may be liable hereunder, or if either party hereto for any reason shall
believe that it has a claim against the other party pursuant to the respective
Section 8.1 or 8.2 hereof, then the indemnified party or the party believing it
has a claim against the other party, as the case may be (in either case, the
"Indemnified Party"), shall give prompt written notice hereunder to the
indemnifying party or the party against whom the party giving notice believes it
has a claim, as the case may be (in either case, the "Indemnifying Party"). Such
notice shall specify in reasonable detail the date such underlying claim or
belief first was asserted or arose, the nature of the Loss(es) for which payment
is claimed, the Section or Sections of this Agreement upon which such claim is
based, and the amount payable in respect thereto, and shall provide a copy of
all pleadings relating to the underlying claim.
15
(b) If an Indemnifying Party shall receive notice pursuant to this
Section 8.3, the Indemnifying Party may, at its sole option, elect to defend
against the Loss, which is the subject of such notice. If the Indemnifying Party
elects to defend, then the Indemnified Party shall have the right to participate
in such defense, and the trial counsel for the Indemnified Party shall be chosen
by the Indemnifying Party and such trial counsel shall be reasonably
satisfactory to the Indemnified Party, the costs of which shall be borne by the
Indemnified Party. If the Indemnifying Party does not elect to defend, then the
Indemnified Party may do so by its own counsel, such counsel shall be reasonably
satisfactory to the Indemnifying Party, the costs of which shall be borne by the
Indemnifying Party, and the Indemnifying Party agrees to cooperate with the
Indemnified Party in such defense.
(c) If the amount of any actual Loss indemnified against hereunder
shall at any time subsequent to the payment of any indemnity payable hereunder,
be reduced by any recovery, settlement or other payment, then the amount of such
reduction, less any expense incurred by the party receiving such recovery,
settlement or other payment in connection therewith, shall be repaid promptly to
the Indemnifying Party.
(d) The aggregate indemnification obligations of Bioglan on the one
hand and Medicis and IMX on the other hand under Section 8.1 or 8.2 hereof, as
the case may be, will not exceed United States Three Million Dollars (US
$3,000,000).
(e) Neither party shall be obligated to indemnify the other for any
Losses hereunder, unless and until the aggregate amount of all Losses exceeds
United States Fifty Thousand Dollars (US $50,000) (the "Basket"), and shall be
liable only for amounts in excess of the Basket; provided that the Basket shall
not apply to Section 8.4 or Section 8.5.
(f) IMX shall have no obligation to indemnify Bioglan with respect
to Section 6.1(g) or Section 6.1(k).
Section 8.4 Discontinuance of Operations. In addition to the other
indemnification obligations set forth in this Article VIII, Medicis shall
indemnify Bioglan for any out of pocket expense incurred by Bioglan in excess of
United States Four Hundred Thousand Dollars (US $400,000) with respect to the
discontinuance of the operations relating to the Purchased Assets if such
operations are discontinued within two (2) months of the Closing Date and are
not incurred due to actions taken by Bioglan other than those costs directly
related to discontinuing such operations; provided, however, that the LLC shall
not be responsible for more than two (2) weeks of severance pay for any employee
of the LLC in connection with such discontinuance.
Section 8.5 Returns of Products. In addition to the other
indemnification obligations set forth in this Article VIII, Medicis shall,
indemnify Bioglan for any return of Products returned within two (2) years of
June 1, 1999 by CVS, Walgreens and Xxxx Xxxxxx; provided that such
indemnification obligation shall not exceed United States Six Hundred Thousand
Dollars (US $600,000).
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ARTICLE IX
GENERAL PROVISIONS
Section 9.1 Survival of Representations and Warranties. All
representations or warranties set forth herein shall survive the execution and
delivery of this Agreement and the consummation of the transactions contemplated
hereby for a period of two (2) years after the Closing Date. Thereafter, no
claim for breach of any representation or warranty shall be made. If this
Agreement is terminated pursuant to Section 9.12 hereof, none of the parties
hereto shall be under any liability whatsoever with respect to any such
representation or warranty. The covenants and agreements shall survive
indefinitely, unless otherwise specified herein.
Section 9.2 Notices. All communications under this Agreement shall
be in writing and shall either be faxed, sent by courier or mailed by first
class mail, postage prepaid, to the fax number and/or address specified below.
If faxed, such communication shall be deemed to be given when sent; provided,
however, that any fax shall be confirmed by sending a hard copy by express
courier or first class mail (by methods specified herein) within one (1)
business day of the sending of such fax. If sent by express courier or mailed by
first class mail as specified herein, such communication shall be deemed to be
given either two (2) business days after sending (for communications sent by
courier) or ten (10) business days after mailing (for communications sent by
mail). All communications hereunder shall be sent:
TO BIOGLAN: at its address shown below or such other address as it may
give to Medicis on behalf of the LLC by notice hereunder:
5 Hunting Gate and to:
Xxxxxxx, Xxxxxxxxxxxxx XX0 0XX Xxxxxx Xxxxxx Solicitors
England Regent House
Attn: Xxxxx X. Xxxxxx 0-0 Xxxxxxxxxx Xxxxxxx
Xxxxx Xxxxxxx
Xxxxxx XX0 0XX England
Attn: Xxxxxx Xxxxxx
TO MEDICIS, at the address shown below or such other address as it may
give to Bioglan by notice hereunder:
c/o Medicis Pharmaceutical Corporation and to:
4343 East Camelback Road, Akin, Gump, Strauss, Xxxxx &
Suite 250 Xxxx, L.L.P.
Xxxxxxx, Xxxxxxx 00000-0000 XXX 000 Xxxxxxx Xxxxxx
Attn: Xxxxx Xxxxxxxx Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxx X. Older, Esq.
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TO IMX, at the address shown below or such other address as it may give to
Bioglan by notice hereunder:
IMX Pharmaceuticals, Inc. and to:
0000 Xxxxxxxxx Xxxxxxxxx Nason, Yeager, Gerson, White,
Xxxx Xxxxx, Xxxxxxx 00000 Xxxxx, P.A.
Attn: Xxxxxxx Xxxxxxx 1645 Palm Beach Xxxxx Xxxxxxxxx
Xxxxx 0000
Xxxx Xxxx Xxxxx, Xxxxxxx 00000
Attn: Xxxx X. Xxxxxx
Section 9.3 Confidential Information. The parties hereto shall each
hold (and shall cause their respective Affiliates to hold) in confidence all
documents and information received by them in connection with the transactions
contemplated by this Agreement and, in the event that for any reason the
transactions contemplated by this Agreement shall not be consummated, the
parties hereto shall refrain (and shall cause their respective Affiliates to
refrain) from disclosing or otherwise using such documents and information
except in connection with any legal proceeding that may be contemplated or
instigated by any party against the other in relation to any matter arising out
of or under this Agreement, or as required by law or regulation. This Section
9.3 shall not apply to information generally available to the public through no
fault of the disclosing party. Nothing in this Section 9.3 shall prevent any
party hereto from disclosing such information as may be required by applicable
law or any governmental or regulatory body or by the rules or regulations of any
national securities exchange upon which the securities of either party are
listed. If any party hereto is requested to disclose confidential information
pursuant to the preceding sentence, (i) such party will notify the other parties
immediately of the existence, terms and circumstances surrounding such a request
so that the other parties may seek a protective order or other appropriate
remedy and/or waive compliance with the provisions of this Agreement, and (ii)
if, in the absence of a protective order, such disclosure is required in the
opinion of the disclosing party's counsel, such party may make such disclosure
without liability hereunder, provided that only that portion of the confidential
information which is legally required is disclosed, the other parties receive
notice of the information to be disclosed as far in advance of its disclosure as
practicable and will use its reasonable best efforts to ensure that confidential
treatment will be accorded to all such disclosed information. Bioglan shall not
disclose confidential information to any third party in connection with the
marketing and selling of Bioglan's securities to such third party without the
prior written consent of Medicis (which consent shall not be unreasonably
withheld), provided that such consent shall be deemed granted if Medicis has not
responded to a request by Bioglan for such consent within twenty-four (24) hours
after Medicis receives actual notice of such request with sufficient information
regarding the terms and conditions of such proposed disclosure to allow Medicis
to evaluate the proposed disclosure.
Section 9.4 Amendment. This Agreement may be amended, modified or
supplemented only by written agreement of the parties hereto.
Section 9.5 Binding Effect. The rights and obligations of the
parties hereto under this Agreement and the agreements contemplated hereby shall
be binding upon and inure
18
to the benefit of the parties hereto and their respective successors and
permitted assigns, but may not be assigned by either party without the prior
written consent of the other parties hereto. Nothing set forth herein shall
prevent such party from assigning its rights or obligations hereunder to an
Affiliate of said party provided that no such assignment shall relieve said
party of its obligations hereunder.
Section 9.6 Press Releases. Bioglan, and Medicis for itself and on
behalf of the LLC and IMX, agree to approve jointly the text of an initial press
release announcing the consummation of the transactions contemplated hereby and
not to use the name of any of the other parties in any press information,
marketing or advertising materials or other release to the public without the
prior written approval of the other, which approval shall not be unreasonably
withheld. The foregoing shall not be deemed to prevent such party from making
any public announcement or issuing any circular which may be required by
legislation or any governmental or regulatory body or by the rules and
regulations of any national securities exchange upon which the securities of
such party are traded; provided that the disclosing party has notified the
non-disclosing party of such public announcement and the non-disclosing party
has been given an opportunity to comment on such announcement. The disclosing
party shall make such changes as are reasonably requested.
Section 9.7 Expenses; Taxes. The parties hereto shall each be
responsible for their respective costs incurred in connection with this
Agreement and the transactions contemplated hereby. Except as otherwise provided
herein, Bioglan shall pay all recording fees and all taxes due by Bioglan in
connection with the transfer of the Purchased Assets to Bioglan hereunder.
Section 9.8 Headings. All headings in this Agreement are for
convenience only and shall not affect the interpretation or meaning of any
provision hereof.
Section 9.9 Entire Agreement. This Agreement, the promissory note to
be entered into pursuant to the Closing of the Asset Purchase Agreement and the
Disclosure Letter, together with the other agreements provided for herein, and
the Schedules and Exhibits attached hereto, constitutes the entire agreement of
the parties, merges all prior negotiations, agreements and understandings, and
states in full all representations and warranties or warranties other than those
herein stated. To the extent there are any inconsistencies between the
provisions of this Agreement and the Disclosure Letter, the Schedules and
Exhibits and any of the other agreements provided for herein, this Agreement
shall govern.
Section 9.10 Waiver. No delay on the part of any party in exercising
any right, power, or privilege hereunder shall operate as a waiver thereof; nor
shall any waiver on the part of any party of any such right, power or privilege,
nor any single or partial exercise of any such right, power or privilege,
preclude any further exercise thereof or the exercise of any other such right,
power or privilege. The rights and remedies of any party based on, arising out
of or otherwise in respect of any inaccuracy in or breach of any representation,
warranty, covenant or agreement contained in this Agreement shall in no way be
limited by the fact that the act, omission, occurrence or other state of facts
upon which any claim of any such inaccuracy or
19
breach is based may also be the subject matter of any other representation,
warranty, covenant or agreement contained in this Agreement (or in any other
agreement between the parties) as to which there is no inaccuracy or breach.
Section 9.11 Severability. If any provision of this Agreement is
found or declared to be invalid or unenforceable by any court or other competent
authority having jurisdiction, such finding or declaration shall not invalidate
any other provision hereof, and this Agreement shall thereafter continue in full
force and effect except that such invalid or unenforceable provision, and (if
necessary) other provisions thereof, shall be reformed by a court of competent
jurisdiction so as to effect, insofar as is practicable, the intention of the
parties as set forth in this Agreement, provided that if such court is unable or
unwilling to affect such reformation, the invalid or unenforceable provision
shall be deemed deleted to the same extent as if it had never existed.
Section 9.12 Termination. This Agreement may be terminated or
extended as set forth in Section 9.12 of the Asset Purchase Agreement; provided,
however, that the provisions of Sections 9.3, 9.7 and 9.13 and Article X shall
survive the termination of this Agreement; and provided further that such
termination shall not relieve any party hereto of any liability for any breach
of this Agreement.
Section 9.13 Governing Law. This Agreement shall be governed by the
substantive laws of the State of Arizona, United States of America (without
regard to principles of conflict of laws) as to all matters, including but not
limited to matters of validity, construction, effect, performance and remedies.
Bioglan consents and submits to the personal jurisdiction of the state and
federal courts in Arizona.
Section 9.14 Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
Section 9.15 Shareholder Approval. Subject to Section 9.12,
notwithstanding the Closing having taken place, if Bioglan shall for any reason
whatsoever fail to procure shareholder approval as provided in Section 7.5 of
the Asset Purchase Agreement, the Closing shall be deemed for all purposes never
to have taken place and all documents delivered at the Closing shall be
cancelled and deemed to be null and void and all the Purchased Assets and
Assumed Liabilities shall be re-transferred to the LLC in the condition that
they are in at such time and subject thereto, except for the Security Agreement
and the Trademark Security Agreement (as defined in the Asset Purchase
Agreement), no party hereto shall be under any further liability or obligation
to any other whether pursuant to this Agreement or otherwise howsoever;
provided, further, that the Security Agreement and the Trademark Security
Agreement shall remain in full force and effect.
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ARTICLE X
ARBITRATION
Section 10.1 Submission to Arbitration. The parties shall promptly
submit to arbitration any dispute which may arise in connection with this
Agreement that is not promptly resolved by them, except that each party may seek
injunctive relief for breaches of this Agreement if either party makes a good
faith determination that a breach of the terms of this Agreement by the other
party will result in irreparable harm and that injunctive relief is the only
adequate remedy.
Section 10.2 Arbitrator and Rules of Arbitration. The American
Arbitration Association shall have jurisdiction over the arbitration, which
shall be conducted in accordance with the Commercial Arbitration Rules of such
Association, except as modified by agreement of the parties.
Section 10.3 Selection of Arbitrators. In the event a dispute is to
be submitted to arbitration pursuant to this Article X, the parties agree that
the dispute shall be resolved by a private arbitration conducted by one
arbitrator. Within ten (10) days after the submission of such dispute to
arbitration, the parties shall agree upon one arbitrator, selected from a panel
of five individuals, none of whom is an officer, director or employee of a party
or an Affiliate of such party, or a person who has a direct or indirect personal
or financial interest in the outcome of the arbitration, designated by the
American Arbitration Association from its permanent panel of commercial
arbitrators. The parties shall select the arbitrator by alternately striking
names of the individuals so designated until only one name remains. A coin toss
will determine which party is to strike the first name.
Section 10.4 Procedure. The arbitrator shall set a hearing date for
an arbitration (the "Hearing") within ninety (90) days from the date the
arbitrator is selected, unless otherwise agreed by the parties. At least fifteen
(15) days before the Hearing, each party shall submit to the arbitrator a list
of all witnesses and exhibits which it intends to present at the Hearing. No
later than five (5) days before the Hearing, each party shall provide to the
arbitrator a short (not to exceed five (5) single-spaced pages or such other
page limit as the arbitrator permits) statement of its position with regard to
the dispute. Notwithstanding the Commercial Arbitration Rules, each party shall
have the right to conduct up to a total of two (2) depositions. At the Hearing,
each party shall, unless it waives the opportunity, make an oral opening
statement and an oral closing statement. The arbitrator shall not be strictly
bound by rules of procedure or rules of evidence, but shall use the Federal
Rules of Evidence as a guideline in conducting the Hearing. When testimony is
complete and each party has introduced its exhibits pursuant to the provisions
of this Agreement, and each party has made a closing statement pursuant to the
provisions of this Agreement or waived the opportunity to do so, the arbitrator
shall declare the Hearing closed; provided that the parties may submit
post-hearing briefs pursuant to an agreed upon schedule or a schedule formulated
by the arbitrator. The Hearing shall be conducted in private. Attendance at the
Hearing shall be limited to the following: (i) the arbitrator; (ii)
representatives of each party; (iii) each party's attorneys and such attorneys'
assistants or advisors, if any, including expert witnesses if any; (iv) a court
reporter if requested by either party; and (v) any witnesses. The
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arbitrator may sequester witnesses upon the motion of a party. Within thirty
(30) days of the close of the Hearing or submission of the post-hearing briefs,
the arbitrator shall issue a written opinion and an award (the "Award") based on
evidence, arguments and post-hearing briefs, if any. The Award shall be a
decision of the arbitrator, shall resolve the parties' dispute and shall be
final and binding on the parties. Except as otherwise provided in this
Agreement, there shall be no ex parte communication regarding the subject matter
of the Hearing, in which event the arbitrator will render and deliver to the
parties a written opinion and Award within thirty (30) days of being notified
that the parties waive the Hearing. Notwithstanding any other provision of this
Agreement, the arbitrator shall have no power to delete from, add to or modify
the terms of this Agreement, and may not award any remedy which effectively
conflicts directly or indirectly with any provision of this Agreement.
Section 10.5 Arbitration Costs. In any arbitration, all of the
reasonable costs and expenses of the successful party ("Successful Party")
(including reasonable attorneys' fees and expenses), all fees and expenses of
experts retained by the Successful Party and all costs of the arbitrator shall
be borne by the losing party ("Losing Party") in such arbitration. The Losing
Party and the Successful Party shall be determined by the arbitrator based on
the relative success or failure of each party to such arbitration.
[SIGNATURE PAGE FOLLOWS]
22
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first set forth above.
THE EXOREX COMPANY, LLC
By:
----------------------------------------
Name:
Title:
BIOGLAN PHARMA PLC
By:
----------------------------------------
Xxxxx X. Xxxxxx
Chairman and Chief Executive Officer
MEDICIS PHARMACEUTICAL CORPORATION
By:
----------------------------------------
Xxxx X. Xxxxxxxx, Xx.
Chief Financial Officer
IMX PHARMACEUTICALS, INC.
By:
----------------------------------------
Name:
Title:
23
SCHEDULE 1
Products
Exorex Aqueous Cleanser
Exorex Body Combo Pack
Exorex Display-Large
Exorex Display-Small
Exorex Excema Formula 4 oz. Gentle
Exorex Excema Formula 4 oz. Regular
Exorex Excema Formula 8 oz. Regular
Exorex Leave on Scalp Conditioner
Exorex Penetrating Emulsion
Exorex Prepak
Exorex Scalp Combo
Exorex Shampoo
Exorex Stabilizing Cream 8 oz.
1
SCHEDULE 2
Trademarks
----------------------------------------------------------------------------------------
TRADEMARK COUNTRY REG. NO. REG. DATE CLASS & GOODS/
SERVICES
----------------------------------------------------------------------------------------
EXOREX US 2049968 4/1/97 Medicated lotions and topical
gels for use in the treatment
of psoriasis.
----------------------------------------------------------------------------------------
2
EXHIBIT A
FORM OF XXXX OF SALE
'A
EXHIBIT B
FORM OF TRANSITION SERVICES AGREEMENT
'B
EXHIBIT C
FORM OF LICENSE ASSIGNMENT
'C
EXHIBIT D
FORM OF TRADEMARK ASSIGNMENT
'D
