WAIVER August 11, 2020
Execution Version
WAIVER
THIS WAIVER (this “Waiver”) is made with reference to the Toll Manufacturing and Supply Agreement dated December 21, 2018 (the “Supply Agreement”) by and among Novartis Pharma AG, a company (Aktiengesellschaft) organized and existing under the laws of Switzerland (“Novartis AG”), Beijing Novartis Pharma Co., Ltd., a company organized and existing under the laws of the People’s Republic of China (“Novartis China” together with Novartis AG, “Novartis”), Cellular Biomedicine Group, Inc., a corporation organized and existing under the laws of Delaware, (the “Company”), and Shanghai Cellular Biopharmaceutical Group Ltd., a company organized and existing under the laws of the People’s Republic of China (“CBMG China”, together with the Company, “CBMG”). Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Supply Agreement. This Waiver is given by Novartis on the date set forth above (the “Waiver Effective Date”) in connection with the Merger (defined below).
WHEREAS, the Company, CBMG Holdings (“Parent”) and CBMG Merger Sub Inc. (“Merger Sub”) have entered into an Agreement and Plan of Merger dated as of the Waiver Effective Date (without giving effect to any amendments or modifications thereto, the “Merger Agreement”) pursuant to which, among other things, Merger Sub will be merged with and into the Company, with the Company surviving the merger as the surviving corporation (the “Surviving Corporation”) and a wholly-owned subsidiary of Parent (the “Merger”);
WHEREAS, immediately following the Merger, the Company will be owned by Novartis and each of the parties (other than Parent and Merger Sub) to the Interim Investors Agreement, dated as of the Waiver Effective Date (the “Interim Investors Agreement”) set forth on Schedule I hereto and additional parties that may become parties to the Interim Investors Agreement by way of a joinder agreement to the Interim Investors Agreement or amendment thereto, together with written notice thereof to Novartis (the “Consortium Members”);
WHEREAS, obligations of CBMG under the Supply Agreement may extend to the Affiliates of CBMG;
WHEREAS, pursuant Section 22.7 of the Supply Agreement, Novartis may terminate the Supply Agreement upon a Change of Control of CBMG or upon CBMG or its Affiliates entering into a definitive agreement which provides for a transaction or series of transactions that would constitute a Change of Control of CBMG, if the Acquirer of such Change of Control transaction is determined by Novartis’ sole discretion to (i) be engaging in certain competing activities as described in clauses (a) and (c) of the proviso to such Section 22.7, (ii) be not in full compliance with any Regulatory Requirements and Novartis internal regulatory and compliance standards for a specified period as described in clause (b) of the proviso to such Section 22.7, or (iii) record worldwide net sales during certain period greater than certain amount stipulated in clause (d) of the proviso to such Section 22.7 (such right to terminate upon a Change of Control under the circumstances described in clauses (a) to (d) of the proviso to such
Section 22.7, the “Early Termination Right”);
WHEREAS, the Company has requested, and the undersigned parties are willing to waive on the terms set forth in this Waiver, the Early Termination Right that may be triggered by the Merger; and
WHEREAS, the Company has requested and the undersigned parties are willing to acknowledge on the terms set forth in this Waiver that none of the Consortium Members (other than Bizuo (Xxxx) Xxx) and their respective Affiliates (other than Parent and its Subsidiaries (including the Surviving Corporation and its Subsidiaries)) (each such Consortium Member, an “Applicable Consortium Member”) shall be deemed an Affiliate of the Company for purposes of the Supply Agreement solely as a result of such Applicable Consortium Member’s participation in the Merger and ownership interest in Parent following the Merger;
NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the undersigned parties hereto hereby agree as follows:
1. Acknowledgement; Waiver. Subject to the terms of this Waiver, the undersigned parties hereby (i) acknowledge that none of the Applicable Consortium Members shall be deemed an Affiliate of the Company for purposes of the Supply Agreement solely as a result of such Applicable Consortium Member’s participation in the Merger and ownership interest in Parent following the Merger, and (ii) waive any Early Termination Right, solely to the extent such right arises as a result of the Merger and the Merger Agreement.
2. Termination. This Waiver shall terminate and be of no further force or effect if the Merger Agreement is terminated without the Merger having been consummated.
3. No other Waiver or Release. For clarity, this Waiver does not constitute a waiver or release of CBMG with respect to any of its other obligations under the Supply Agreement or in connection with any other transaction or set of facts not expressly contemplated by this Waiver.
4. Governing Law; Dispute Resolution. This Waiver shall be governed by and construed under the laws of the State of Delaware, without regard to conflicts of laws principles. Any Dispute arising under this Waiver shall be resolved in accordance with Section 24.2 of the Supply Agreement.
[Signature Pages Follow]
Execution Version
IN WITNESS WHEREOF, the undersigned have executed this Waiver as of the date first above written.
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By: |
/s/ Xxxxxxx Xxxxxx |
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Name: |
Xxxxxxx Xxxxxx |
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Title: |
Authorized Signatory |
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By: |
/s/ Xxxxxxx Xxxxxxx Sacristan |
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Name: |
Xxxxxxx Xxxxxxx Sacristan |
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Title: |
Authorized Signatory |
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Beijing Novartis Pharma Co., Ltd. | |
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(Company Seal) | |
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By: |
/s/ Xxxxxxxx Xxxx |
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Name: |
Xxxxxxxx Xxxx |
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Title: |
As Attorney |
[SIGNATURE PAGE TO WAIVER (SUPPLY AGREEMENT)]
Schedule I
Consortium Members
Yunfeng Fund III, L.P.
Velvet Investment Pte. Ltd.
TF Capital Ranok Ltd.
Bizuo (Xxxx) Liu
Li (Xxxxx) Zhang
Xxxxxx Xxx
Chengxiang (Chase) Dai
Dangdai International Group Co., Limited
Mission Right Limited
Wealth Map Holdings Limited
Xxxxx Mill Limited
Viktor Pan
Xxxxx Xxxx
OPEA SRL
Maplebrook Limited
Full Moon Resources Limited
