Exhibit 10.7
EXECUTION COPY
[***] TEXT OMITTED AND FILED SEPARATELY
CONFIDENTIAL TREATMENT REQUESTED
JOINT DEVELOPMENT AND OPERATING AGREEMENT
ELAN CORPORATION, PLC
AND
ELAN INTERNATIONAL SERVICES, LTD.
AND
DOV PHARMACEUTICAL, INC.
AND
DOV NEWCO, LTD.
AND
NASCIME LIMITED
1
TABLE OF CONTENTS
CLAUSE PAGE
1. Definitions.............................................................4
2. The Business of the Company and Nascime................................10
3. Memorandum and Articles of Association.................................11
4. Representation and Warranties..........................................11
5. Completion.............................................................16
6. Subscriptions and Additional Financing.................................18
7. Directors..............................................................23
8. Direction of Research and Development..................................24
9. The Business Plan and Reviews..........................................27
10. Property Ownership Rights..............................................27
11. Patent Rights..........................................................29
12. Exploitation of Products...............................................33
12.A Regulatory Approvals....................................................34
13. Non-Competition........................................................35
14. Technical Services and Assistance......................................36
15. Manufacturing and Supply Arrangements..................................37
16. Auditors; Bankers; Registered Office; Accounting
Reference Date; Secretary; Counsel.....................................38
17. Share Rights and Directors.............................................39
18. Matters Requiring Participants' Approval...............................39
19. Transfer of or Charging of Shares......................................42
20. Disputes...............................................................43
21. Termination............................................................44
22. Confidentiality........................................................47
23. Participant's Consent..................................................49
24. Participant's Bound....................................................50
25. Costs..................................................................50
26. Costs..................................................................50
2
THIS AGREEMENT made this 21st day of January 1999
AMONG:
(1) ELAN CORPORATION, PLC, a public limited company incorporated under the
laws of Ireland, and having its registered office at Xxxxxxx Xxxxx,
Xxxxxxx Xxxxx, Xxxxxx 0, Xxxxxxx ("ELAN").
(2) ELAN INTERNATIONAL SERVICES, LTD., a private limited company incorporated
under the laws of Bermuda and having its registered office at Flatts,
Smiths Parish, Bermuda, FL 04 ("EIS").
(3) DOV PHARMACEUTICAL, INC., a corporation duly incorporated and validly
existing under the laws of New Jersey and having its principal place of
business Xxx Xxxxxx Xxxxx, Xxxx Xxx, Xxx Xxxxxx 00000, Xxxxxx Xxxxxx of
America ("DOV").
(4) DOV NEWCO, LTD., an exempted limited company incorporated under the laws
of Bermuda and having its registered office at Xxxxxxxxx Xxxxx, 0 Xxxxxx
Xxxxxx, Xxxxxxxx, Xxxxxxx ("XXX COMPANY").
(5) NASCIME LIMITED, a private limited company incorporated under the laws of
Ireland and having its registered office at 00 Xxxxxxx Xxxxxx, Xxxxxx 0
("NASCIME").
RECITALS:
A. The Company is an exempted limited company incorporated in Bermuda on the
19th day of January, 1999 under the Companies Acts of Bermuda which has
been incorporated for the special and limited purpose of holding of the
issued shares of Nascime.
B. Nascime is a private company incorporated on the 3rd day of December, 1998
under the Companies Acts of Ireland.
C. Elan is beneficially entitled to the use of certain patents that have been
granted or are pending in relation to drug specific dosage forms for
pharmaceutical products and Elan has developed various drug delivery
technologies and/or pharmaceutical products derived therefrom, having
improved pharmaceutical, biopharmaceutical or other characteristics.
3
D. DOV is beneficially entitled to the use of the Compounds.
E. Elan and DOV have agreed to co-operate in the establishment and management
of a business for the research, development and commercialisation of the
Products and otherwise in the Field, based on their respective
technologies, for human use and whether for prescription or
non-prescription use.
F. Elan and DOV have agreed to enter into this Agreement for the purpose of
recording the terms and conditions of the joint venture and of regulating
their relationship with each other and certain aspects of the affairs of
and their dealings with the Company.
NOW IT IS HEREBY AGREED AS FOLLOWS:
CLAUSE 1
DEFINITIONS
1.1 In this Agreement, the following terms shall, where not inconsistent
with the context, have the following meanings respectively.
""A" SHARES" shall mean the class "A" voting common shares in the
capital of the Company having the rights attaching thereto, as
described in Clause 17.
"ACY" shall mean American Cyanamid Company.
"ACY AGREEMENT" shall mean that certain agreement between DOV and
ACY dated 29th May 1998, pursuant to which DOV licensed rights to
the Compounds for the Territory.
"AFFILIATE" of any Person (in the case of a legal entity) shall mean
any other Person controlling, controlled or under the common control
of such first Person as the case may be. For the purposes of this
definition, "control" shall mean direct or indirect ownership of
fifty percent (50%) or more of the stock or shares entitled to vote
for the election of directors or capital interests representing at
least 50% of the equity thereof and "controlling" and "controlled"
shall be construed accordingly.
"AGREEMENT" shall mean this agreement (which expression shall be
deemed to include the Recitals and the Schedules hereto).
""B" NON VOTING SHARES" shall mean the class "B" non-voting common
shares in the capital of the Company having the rights attaching
thereto, as described in Clause 17.
4
"BUSINESS" shall mean the business of Nascime as described in Clause
2 and as more particularly specified in the Business Plan and such
other business as the Parties may agree from time to time in writing
should be carried on by Nascime.
"BUSINESS PLAN" shall mean the plans to be prepared and approved by
the Nascime Directors pursuant to Clause 9, in conjunction with the
Research and Development Programmes or the other business of
Nascime, for the conduct of the Business of Nascime for each
Financial Year for the duration of this Agreement, which shall
include, in particular, details of the planned research and
development expenses to be incurred in that Financial Year, which of
the Participants shall be responsible for the relevant research and
development expenditure, and how such expenses shall be funded and,
among other things, to the extent practicable, the research and
development objectives, desired Product specifications, clinical
indications, preliminary clinical trial designs (Phase I/II),
development timelines, budgeted costs and the relative
responsibilities of DOV and Elan as they relate to the
implementation of the Research and Development Plan.
"COMPANY DIRECTORS" shall mean, at any time, the directors of the
Company.
"COMPANY MEMORANDUM OF ASSOCIATION AND BYE-LAWS" shall mean the
Memorandum of Association and Bye-Laws to be adopted by the Company
on Completion, as amended from time to time.
"COMPLETION" shall mean the performance by the Parties hereto of
their respective obligations under Clause 5.
"COMPOUNDS" shall mean the DOV compounds DOV 220,075 and DOV
273,547, the rights to which were licensed by DOV pursuant to the
ACY Agreement.
"CONFIDENTIAL INFORMATION" shall have the meaning set forth in
Clause 22.2. and Clause 22.6.
"CONTROLLED RELEASE" shall mean the modification of the release
profile of an orally administered drug to provide a delayed,
extended, sustained, programmed and/or pulsatile release profile
and/or prolongation and/or modification of a therapeutic effect.
"DOV COMPANY DIRECTORS" shall mean the directors of the Company who
are the designees of DOV.
"DOV IMPROVEMENTS" shall have the meaning assigned to it in the DOV
License Agreement.
5
"DOV INTELLECTUAL PROPERTY" shall have the meaning assigned to it in
the DOV License Agreement.
"DOV KNOW-HOW" shall have the meaning assigned to it in the DOV
License Agreement.
"DOV LICENSE AGREEMENT" shall have the meaning set forth in Clause
5.4.7.
"DOV PATENT RIGHTS" shall have the meaning assigned to it in the DOV
License Agreement.
"EFFECTIVE DATE" shall mean the date of this Agreement.
"EIS COMPANY DIRECTORS" shall mean the directors of the Company who
are the designees of DOV.
"ELAN IMPROVEMENTS" shall have the meaning assigned to it in the
Elan License Agreement.
"ELAN INTELLECTUAL PROPERTY" shall have the meaning assigned to it
in the Elan License Agreement.
"ELAN KNOW-HOW" shall have the meaning assigned to it in the Elan
License Agreement.
"ELAN LICENSE AGREEMENT" shall have the meaning set forth in Clause
5.4.6.
"ELAN PATENT RIGHTS" shall have the meaning assigned to it in the
Elan License Agreement.
"ENCUMBRANCE" shall mean any lien, charge, pledge, encumbrance or
other restriction.
"EXCHANGE RIGHT" shall have the meaning assigned to it in the
Securities Purchase Agreement.
"EXPERT" shall have the meaning assigned to it in Clause 20.3.
"FDA" shall mean the United States Food and Drug Administration or
any successors or agency, the approval of which is necessary to
market a product in the United States of America.
6
"FINANCIAL YEAR" means each year commencing on 1 January (or in the
case of the first Financial Year, the Effective Date) and expiring
on 31 December of each year.
"FIELD" shall mean the research, development and commercialization
of oral Controlled Release formulations of the Products.
"IND" shall mean an investigational new drug application filed with
the FDA or an ORA.
"LICENSE AGREEMENTS" means the Elan License Agreement and the DOV
License Agreement.
"MANAGEMENT COMMITTEE" shall have the meaning set forth in Clause
8.2.
"NASCIME DIRECTORS" shall mean the directors of Nascime from time to
time.
"NASCIME INTELLECTUAL PROPERTY" shall have the meaning set forth in
Clause 10.3.
"NASCIME MEMORANDUM AND ARTICLES OF ASSOCIATION" shall mean the
Memorandum and Articles of Association to be adopted by Nascime on
Completion, as amended from time to time.
"NASCIME PATENT RIGHTS" shall mean any and all patents now existing,
currently pending or hereafter filed or obtained relating to the
Nascime Intellectual Property, and any foreign counterparts thereof
and all divisionals, continuations, continuations-in-part, patents
of continuation, any foreign counterparts thereof and all
divisionals, continuations, continuations-in-part, patents of
addition and substitutions of, and all patents issuing on, any of
the foregoing, together with all registrations, reissues,
re-examinations or extensions of any kind with respect to any of
such patents.
"NDA" shall mean, collectively, any New Drug Application,
pre-marketing approval, 510(k) approval or other regulatory approval
application, in relation to a Product filed by any Party with the
FDA or ORA.
"OPTION PERIOD" shall have the meaning set forth in Clause 12.3.
"ORA" shall mean any regulatory authority outside the United States
of America, the approval of which is necessary to market a Product;
"PARTICIPANT" shall mean DOV or EIS, as the case may be, and
"PARTICIPANTS" means each of the Participants together.
"PARTY" shall mean Elan, EIS, DOV, Nascime or the Company, as the
case may be,
7
and "PARTIES" shall mean all five together.
"PERSON" shall mean an individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust,
unincorporated association, joint venture, governmental entity or
authority or other entity of whatever nature.
"PRESIDING JUSTICE" shall have the meaning set forth in Clause 20.3.
"PRODUCTS" shall mean the Controlled Release formulations using the
Elan Intellectual Property and incorporating the Compounds.
"PROPOSING PARTICIPANT" shall have the meaning set forth in Clause
21.1.1
"PROPOSING PARTICIPANT PRICE" shall have the meaning set forth in
Clause 21.1.3.
"PURCHASE PRICE" shall have the meaning set forth in Clause 21.1.3.
"R&D COMMITTEE" shall have the meaning set forth in Clause 8.3.
"RECIPIENT PARTICIPANT" shall have the meaning set forth in Clause
21.1.1.
"RECIPIENT PARTICIPANT PRICE" shall have the meaning set forth in
Clause 21.1.3.
"RELEVANT EVENT" shall have the meaning set forth in Clause 21.1.
"RESEARCH AND DEVELOPMENT PLAN" shall mean the program of work,
including a budget for the remaining portion of the first year and a
projected budget for the remaining 18 months, agreed by the
Management Committee attached as part of the Business Plan that
relates to the formulation, biopharmaceutical and Phase II clinical
development of the Products and such further research and
development work as may be agreed by the Management Committee from
time to time.
"RESEARCH AND DEVELOPMENT PROGRAMME" shall mean, depending on the
context, one or more programmes of research and development work
being conducted or to be conducted by, INTER ALIA, DOV and Elan for
and on behalf of Nascime which have been devised by the R&D
Committee and approved by the Management Committee.
"SECURITIES PURCHASE AGREEMENT" shall mean the agreement of even
date entered into between EIS and DOV.
"SHARES" shall mean the "A" Shares and the "B" Non-Voting Shares.
8
"SPECIFICATIONS" shall mean the specifications for each of the
Products as approved by the FDA, as well as such other
specifications which may be agreed upon by the Parties in writing or
by the R&D Committee.
"SUBSIDIARY" shall mean any company that is a subsidiary of the
Company within the meaning of the Companies Acts of Bermuda,
including Nascime.
"TECHNOLOGIES" shall mean, collectively, the Elan Intellectual
Property, the DOV Intellectual Property and the Nascime Intellectual
Property.
"TERRITORY" means all of the countries of the world.
"UNITED STATES DOLLAR" and "US$" shall mean the lawful currency for
the time being of the United States of America.
1.2 Words importing the singular shall include the plural and vice
versa, the masculine includes the feminine and vice versa and the
neuter includes the masculine and the feminine.
1.3. Unless the context otherwise requires, reference to a recital,
article, paragraph, provision, clause or schedule is to a recital,
article, paragraph, provision, clause or schedule of or to this
Agreement.
1.4. Reference to a statute or statutory provision includes a reference
to it as from time to time amended, extended or re-enacted.
1.5. The headings in this Agreement are inserted for convenience only and
do not affect its construction.
1.6. Unless the context or subject otherwise requires, references to
words in one gender include references to the other genders.
9
CLAUSE 2
THE BUSINESS OF THE COMPANY AND NASCIME
2.1 The primary object of Nascime is to carry on the business of the
development, testing, exploitation, registration, manufacture,
commercial realisation and licensing of Products in the Field in the
Territory and to achieve the objectives set out in this Agreement.
The purpose of forming the Company and Nascime is to enable Elan and
DOV to develop, exploit and commercialize the Products throughout
the Territory. The focus of the collaborative venture will be to
develop the Products using the Elan Intellectual Property to agreed
upon specifications and timelines. Nascime shall be responsible for
determining the subsequent commercialization strategy to allow the
Products to be marketed in the Territory.
2.2. Should one or both of the Compounds fail to meet agreed
specifications, the Parties shall review in good faith the
possibility of in-licensing another compound(s) from the DOV
portfolio of compounds, or in-licensing or acquiring the rights from
one or more third parties to such compound or compounds.
Alternatively, should one or both of the Products fail to meet
agreed specifications, the Parties shall review in good faith
alternative technology approaches within the Elan Intellectual
Property. In either case, the Parties shall negotiate in good faith
such amendments as are required to this Agreement, such as amending
the provisions regulating non-competition.
2.3. Each Participant shall use all reasonable and proper means at its
disposal and within its power to maintain, extend and improve the
Business of Nascime and the Company, within the limits of this
Agreement, and to further the reputation and interests of Nascime
and the Company.
2.4. The central management and control of the Company shall be exercised
in Bermuda and shall be vested in the Directors and such Persons as
they may delegate the exercise of their powers in accordance with
the Company Memorandum of Association and Bye-Laws. The Participants
shall use their best endeavours to ensure that to the extent
required pursuant to the laws of Bermuda or to ensure the sole
residence of the Company in Bermuda all meetings of the Directors
are held in Bermuda or other jurisdictions outside the United States
and generally to ensure that the Company is treated as resident for
taxation purposes in Bermuda.
2.5. The central management and control of Nascime shall be exercised in
Ireland and shall be vested in the Nascime Directors and such
Persons as they may delegate the exercise of their powers in
accordance with the Nascime Memorandum and Articles of Association.
The Participants shall use their best endeavours to ensure:
2.5.1. that all meetings of the Nascime Directors are held in
Ireland and generally to ensure that Nascime is treated
as solely resident for taxation purposes in
10
Ireland; and
2.5.2. that the activities of Nascime are carried out in such
manner as is necessary to avail of any applicable
exemptions from taxation in Ireland or other relevant
jurisdictions in which the Business is conducted.
CLAUSE 3
COMPANY MEMORANDUM OF ASSOCIATION AND BYE-LAWS
AND NASCIME MEMORANDUM AND ARTICLES OF ASSOCIATION
3.1 In the event of any ambiguity or conflict arising between the terms
of this Agreement and those of the Company Memorandum of Association
and Bye-Laws, the terms of this Agreement shall prevail.
3.2 In the event of any ambiguity or conflict arising between the terms
of this Agreement and those of the Nascime Memorandum and Articles
of Association, the terms of this Agreement shall prevail.
CLAUSE 4
REPRESENTATIONS AND WARRANTIES
4.1 REPRESENTATIONS AND WARRANTIES OF THE COMPANY: the Company hereby
represents and warrants to each of EIS and DOV as follows, as of the
date hereof:
4.1.1 ORGANIZATION: the Company is a corporation duly
organized, validly existing and in good standing under
the laws of Bermuda, and has all the requisite corporate
power and authority to own and lease its properties, to
carry on its business as presently conducted and as
proposed to be conducted, to execute this Agreement,
which has been duly authorized and is enforceable
against the Company in accordance with its terms, and to
carry out the transactions contemplated hereby.
4.1.2 CAPITALIZATION: The sole authorized shares of the
Company as of the date hereof are as set forth in
SCHEDULE 1.
Prior to the Effective Date, no shares of the Company
have been issued.
4.1.3 AUTHORIZATION: The execution, delivery and performance
by the Company of this Agreement, including the issuance
of the Shares, have been duly
11
authorized by all requisite corporate actions; this
Agreement has been duly executed and delivered by the
Company and is the valid and binding obligation of the
Company, enforceable against it in accordance with its
terms except as limited by applicable bankruptcy,
insolvency, reorganization, moratorium and other laws of
general application affecting the enforcement of
creditors' rights generally, and except as enforcement
of rights to indemnity and contribution hereunder and
thereunder may be limited by U.S. Federal or state
securities laws or similar applicable laws in other
relevant jurisdictions, or principles of public policy,
the Shares, when issued as contemplated hereby, will be
validly issued and outstanding, fully paid and
non-assessable and not subject to preemptive or any
other similar rights of the Participants or others.
4.1.4 NO CONFLICTS: The execution, delivery and performance by
the Company of this Agreement, the issuance, sale and
delivery of the Shares, and compliance with the
provisions hereof by the Company, will not (i) violate
any provision of applicable law, statute, rule or
regulation applicable to the Company or any ruling,
writ, injunction, order, judgment or decree of any
court, arbitrator, administrative agency or other
governmental body applicable to the Company or any of
its properties or assets or (ii) conflict with or result
in any breach of any of the terms, conditions or
provisions of, or constitute (with notice or lapse of
time or both) a default (or give rise to any right of
termination, cancellation or acceleration) under, or
result in the creation of, any Encumbrance upon any of
the properties or assets of the Company under its
charter or organizational documents or any material
contract to which the Company is a party, except where
such violation, conflict or breach would not,
individually or in the aggregate, have a material
adverse effect on the Company.
4.1.5 APPROVALS: No permit, authorization, consent or approval
of or by, or any notification of or filing with, any
Person is required in connection with the execution,
delivery or performance of this Agreement by the
Company. the Company has full authority to conduct its
business as contemplated in the Business Plan.
4.1.6 DISCLOSURE: This Agreement does not contain any untrue
statement of a material fact or omit to state any
material fact necessary to make the statements contained
herein and therein not misleading. The Company is not
aware of any material contingency, event or circumstance
relating to its business or prospects, which could have
a material adverse effect thereon, in order for the
disclosure herein relating to the Company not to be
misleading in any material respect.
4.1.7 NO BUSINESS; NO LIABILITIES: The Company has not
conducted any business or incurred any liabilities or
obligations prior to the date hereof, except solely in
12
connection with its organization and formation and the
entering into of the Definitive Documents.
4.2 REPRESENTATIONS AND WARRANTIES OF NASCIME: Nascime hereby represents
and warrants to each of EIS and DOV as follows, as of the date
hereof:
4.2.1 ORGANIZATION: Nascime is a corporation duly incorporated
and validly existing under the laws of Ireland, and has
all the requisite corporate power and authority to own
and lease its properties, to carry on its business as
presently conducted and as proposed to be conducted, to
execute this Agreement, which has been duly authorized
and is enforceable against Nascime in accordance with
its terms, and to carry out the transactions
contemplated hereby.
4.2.2 CAPITALIZATION: The sole authorized shares of Nascime as
of the Effective Date is IR(pound)100,000 divided into
100,000 ordinary shares of IR(pound)1 each. Prior to the
Completion on the Effective Date, the only shares of
Nascime issued are two ordinary shares of IR(pound)1
each.
4.2.3 AUTHORIZATION: The execution, delivery and performance
by Nascime of this Agreement, including the issuance of
the shares to the Company, have been duly authorized by
all requisite corporate actions; this Agreement has been
duly executed and delivered by Nascime and is the valid
and binding obligation of Nascime, enforceable against
it in accordance with its terms except as limited by
applicable bankruptcy, insolvency, reorganization,
moratorium and other laws of general application
affecting the enforcement of creditors' rights
generally, and except as enforcement of rights to
indemnity and contribution hereunder and thereunder may
be limited by U.S. Federal or state securities laws or
similar applicable laws in other relevant jurisdictions,
or principles of public policy, the shares of Nascime,
when issued as contemplated hereby, will be validly
issued and outstanding, fully paid and non-assessable
and not subject to preemptive or any other similar
rights of the shareholders of Nascime or others.
4.2.4 NO CONFLICTS: The execution, delivery and performance by
Nascime of this Agreement, the issuance, sale and
delivery of the Shares, and compliance with the
provisions hereof by Nascime, will not (i) violate any
provision of applicable law, statute, rule or regulation
applicable to Nascime or any ruling, writ, injunction,
order, judgment or decree of any court, arbitrator,
administrative agency or other governmental body
applicable to Nascime or any of its properties or assets
or (ii) conflict with or result in any breach of any of
the terms, conditions or provisions of, or constitute
(with notice or lapse of time or both) a default (or
give rise to any right of termination, cancellation or
13
acceleration) under, or result in the creation of, any
Encumbrance upon any of the properties or assets of
Nascime under its charter or organizational documents or
any material contract to which Nascime is a party,
except where such violation, conflict or breach would
not, individually or in the aggregate, have a material
adverse effect on Nascime.
4.2.5 APPROVALS: No permit, authorization, consent or approval
of or by, or any notification of or filing with, any
Person is required in connection with the execution,
delivery or performance of this Agreement by Nascime.
Nascime has full authority to conduct its business as
contemplated in the Business Plan.
4.2.6 DISCLOSURE: This Agreement does not contain any untrue
statement of a material fact or omit to state any
material fact necessary to make the statements contained
herein and therein not misleading. Nascime is not aware
of any material contingency, event or circumstance
relating to its business or prospects, which could have
a material adverse effect thereon, in order for the
disclosure herein relating to Nascime not to be
misleading in any material respect.
4.2.7 NO BUSINESS; NO LIABILITIES: Nascime has not conducted
any business or incurred any liabilities or obligations
prior to the date hereof, except solely in connection
with its organization and formation and the entering
into of the Definitive Documents.
4.3. REPRESENTATIONS AND WARRANTIES OF THE PARTICIPANTS: Each of EIS and
DOV hereby severally represents and warrants to the Company as
follows:
4.3.1 ORGANIZATION. Such Participant is a corporation duly
organized and validly existing under the laws of its
jurisdiction of organization and has all the requisite
corporate power and authority to own and lease its
respective properties, to carry on its respective
business as presently conducted and as proposed to be
conducted and to carry out the transactions contemplated
hereby.
4.3.2 AUTHORITY: Such Participant has full legal right, power
and authority to enter into this Agreement and to
perform its obligations hereunder, which have been duly
authorized and by all requisite corporate action. This
Agreement is the valid and binding obligation of such
Participant, enforceable against it in accordance with
its terms except as limited by applicable bankruptcy,
insolvency, reorganization, moratorium and other laws of
general application affecting the enforcement of
creditors' rights generally, and except as enforcement
of rights to indemnity and contribution hereunder and
thereunder may be limited by U.S. Federal or state
securities laws or principles of public
14
policy.
4.3.3 NO CONFLICTS: The execution, delivery and performance by
such Participant of this Agreement, purchase of the
Shares, and compliance with the provisions hereof by
such Participant will not (i) violate any provision of
applicable law, statute, rule or regulation applicable
to such Participant or any ruling, writ, injunction,
order, judgment or decree of any court, arbitrator,
administrative agency or other governmental body
applicable to such Participant or any of its properties
or assets or (ii) conflict with or result in any breach
of any of the terms, conditions or provisions of, or
constitute (with notice or lapse of time or both) a
default (or give rise to any right of termination,
cancellation or acceleration) under the charter or
organizational documents of such Participant or any
material contract to which such Participant is a party,
or result in the creation of, any Encumbrance upon any
of the properties or assets of such Participant, except
where such violation, conflict or breach would not,
individually or in the aggregate, have a material
adverse effect on such Participant.
4.3.4 APPROVALS:. No permit, authorization, consent or
approval of or by, or any notification of or filing
with, any Person is required in connection with the
execution, delivery or performance of this Agreement by
such Participant.
4.3.5 INVESTMENT REPRESENTATIONS: Such Participant is capable
of evaluating the merits and risks of their respective
investment in the Company. Such Participant has not been
formed solely for the purpose of making this investment
and such Participant is acquiring the Shares, for
investment for its own account, not as a nominee or
agent, and not with the view to, or for resale in
connection with, any distribution of any part thereof.
Such Participant understands that the Shares have not
been registered under the Securities Act or applicable
state and other securities laws by reason of a specific
exemption from the registration provisions of the
Securities Act and applicable state and other securities
laws, the availability of which depends upon, among
other things, the bona fide nature of the investment
intent and the accuracy of such Participants'
representations as expressed herein. Such Participant
understands that no public market now exists for any of
the Shares and that there is no assurance that a public
market will ever exist for the Shares.
15
CLAUSE 5
COMPLETION
5.1 Completion shall take place on the Effective Date at the offices of
Xxxxx Xxxxxxxxxxx XxXxxxxxx LLC at 000 Xxxx 00xx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000 immediately after the execution of this Agreement on
21st January 1999 and such other places, if any, as the Parties may
agree.
THE COMPANY
5.2 On Completion, each of the Participants shall take or (to the extent
within its powers) cause to be taken the following steps at
directors and shareholder meetings of the Company, or such other
meetings or locations, as appropriate:
5.2.1. the adoption by the Company of the Company Memorandum of
Association and Bye-Laws;
5.2.2. the appointment of Xxxxxxx Beer, Xxxxx Xxxxxx and Xxxxxx
Xxxxx as Directors of the Company;
5.2.3. the resignation of all directors and the secretary of
the Company holding office prior to the execution of
this Agreement and delivery of written confirmation
under seal by each Person so resigning that he has no
claim or right of action against the Company and that
the Company is not in any way obligated or indebted to
him;
5.2.4. DOV and EIS shall each subscribe for the number of
Shares set forth in SCHEDULE A and shall pay to the
Company, by wire transfer of immediately available funds
(to a bank account established by the Company in
connection with Completion) the subscription amounts
each as provided in SCHEDULE A. In addition, each of the
Participants shall have an interest in any additional
capital in the Company, whether in the form of gift,
additional paid in capital or other capital in excess of
the amount subscribed for the "A" Shares and the "B"
Non-Voting Shares, respectively; such interests to be
PRO RATA between the Participants, based on their
respective interests in the aggregate issued and
outstanding Shares, counting the "A" Shares and the "B"
Non-Voting Shares equally for all purposes relating
thereto ; and
5.2.5. the transfer to the Company of the share register,
5.3. EXEMPTION FROM REGISTRATION. The Shares will be issued under an
exemption or exemptions from registration under the Securities Act
of 1933, as amended;
16
accordingly, the certificates evidencing the Shares shall, upon
issuance, contain the following legend:
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED PURSUANT
TO THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF
ANY OTHER APPLICABLE JURISDICTION AND MAY NOT UNDER ANY
CIRCUMSTANCES BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT
PURSUANT TO (I) AN EFFECTIVE REGISTRATION STATEMENT FOR SUCH
SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND ANY
APPLICABLE SECURITIES LAWS OF ANY OTHER APPLICABLE JURISDICTION OR
(II) TO THE EXTENT APPLICABLE, RULE 144 (OR SIMILAR PROVISION) UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF
ANY OTHER APPLICABLE JURISDICTION (OR ANY SIMILAR RULE UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY
OTHER APPLICABLE JURISDICTION, RELATING TO THE DISPOSITION OF
SECURITIES) TOGETHER WITH AN OPINION OF COUNSEL SATISFACTORY TO THE
COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT OR THE
SECURITIES LAWS OF ANY OTHER APPLICABLE JURISDICTION.
NASCIME
5.4. On Completion, each of the Participants shall take or (to the extent
within its powers) cause to be taken the following steps at
directors and shareholder meetings of Nascime, or such other
meetings or locations, as appropriate:
5.4.1. the adoption by Nascime of the Nascime Memorandum and
Articles of Association;
5.4.2. the appointment of Xxxxxxx Beer, Xxxxxx Xxxxx, Xxxxxx
Xxxxx, Xxxx Xxxxxx and Xxxxx Xxxxxxxxx as Directors of
Nascime;
5.4.3. the resignation of all directors and the secretary of
Nascime holding office prior to the execution of this
Agreement and delivery of written confirmation under
seal by each Person so resigning that he has no claim or
right of action against Nascime and that Nascime is not
in any way obligated or indebted to him;
5.4.4. the transfer to Nascime of the share register;
5.4.5. the transfer to the Company of the full legal and
beneficial interest of the shares
17
registered in the name of Matsack Trust limited and
Matsack Nominees Limited;
5.4.6. the execution by Elan and Nascime of the Elan License
Agreement pursuant to which Elan shall, INTER ALIA,
grant Nascime certain license rights and shall, INTER
ALIA, agree to provide research and development services
for and on behalf of Nascime, in the form annexed as
SCHEDULE B (the "Elan License Agreement"); and
5.4.7. the execution by DOV and Nascime of the DOV License
Agreement, pursuant to which DOV shall, INTER ALIA,
grant Nascime certain license rights and shall, INTER
ALIA, agree to provide research and development services
for and on behalf of Nascime, in the form annexed as
SCHEDULE C (the "DOV License Agreement"); and
5.5. Elan and DOV shall use reasonable efforts to file any documents that
require filing with the Registrar of Companies in Bermuda or in
Ireland within the prescribed time limits.
5.6. In the event that EIS exercises the Exchange Right, the Company
shall, immediately upon such exercise, take all necessary steps to
ensure that EIS is duly and validly issued and has full legal right,
title and interest in and to the "B" Non-Voting Shares covered
thereby. The Parties acknowledge that such shares have been pledged
to EIS pursuant to the Securities Purchase Agreement and that EIS
has physical possession of such shares; upon such exercise, EIS
shall be entitled to keep and retain such shares, which shall be
owned by EIS as provided above. In connection with the foregoing,
the Company and the Participants shall take all necessary or
appropriate steps to ensure such ownership by EIS.
CLAUSE 6
ADDITIONAL FINANCING
6.1. It is estimated that Nascime will require up to [***] within the
first [***] after the Effective Date, to enable Nascime to commence
development of the Products based upon the DOV Intellectual
Property, the Elan Intellectual Property and/or the Nascime
Intellectual Property. For the avoidance of doubt, the Parties
confirm that this sum is in addition to the sums payable by Nascime
to Elan pursuant to Clause 6.1.1. of the Elan License Agreement and
by Nascime to DOV pursuant to Clause 6.1.1. of the DOV License
Agreement.
6.2.1. Of the sum of up to [***] referred to in Clause 6.1, (i) [***] shall
be provided by DOV within [***] of the Effective Date by way of
additional capital in the Company,
------------
[***] Omitted pursuant to a request for confidential treatment. The omitted
material has been separately filed with the Securities and Exchange
Commission.
18
whether in the form of gift, additional paid in capital or other
capital, or such other means as may be agreed by the Participants,
(in the event all or part of such sum is made by way of paid in
capital in the Shares of the Company, such capital shall be issued
at the same price per Share as the Shares subscribed for by EIS and
DOV pursuant to Clause 5.2.4.) from the proceeds to DOV of EIS's
purchase of US$3 million of Common Stock (as such term is defined
in the Securities Purchase Agreement) pursuant to Section 1 of the
Securities Purchase Agreement, and (ii) [***] shall be provided by
EIS within [***] of the Effective Date by way of additional capital
in the Company, whether in the form of gift, additional paid in
capital or other capital, or such other means as may be agreed by
the Participants. Funding shall be contributed on the following
terms:
(1) in minimum increments of [***] (except in the event that an
amount less than [***] remains available for funding, in which
case such lesser amount may be funded);
(2) no more frequently than [***] times per calendar year; and
(3) in accordance with the Business Plan and the Research and
Development Plan.
6.2.2. Of the sum of up to [***] referred to in Clause 6.1, the remaining
sum of up to [***] of such funds shall be provided by DOV and EIS
[***] by way of additional capital in the Company, whether in the
form of gift, additional paid in capital or other capital, or such
other means as may be agreed by the Participants, (in the event all
or part of such sum is made by way of paid in capital in the Shares
of the Company, such capital shall be issued at the same price per
Share as the Shares subscribed for by EIS and DOV pursuant to Clause
5.2.4.) in such amounts and at such times as shall be necessary for
development of the Products, as shall be reasonably determined in
good faith by the decision of the Company Directors, including the
EIS Company Director (or after the exercise of the Exchange Right by
at least one of the EIS Company Directors) and at least one of the
DOV Company Directors that such subsequent funding is required for
the development of the Products in accordance with the Business Plan
or as otherwise approved by the Nascime Directors. Funding shall be
contributed on the following terms:
(1) in minimum increments of [***] (except in the event that an
amount less than [***] remains available for funding, in which
case such lesser amount may be funded);
(2) no more frequently than [***] times per calendar year; and
(3) in accordance with the Business Plan and the Research and
Development Plan.
6.2.3. In the event that the Participants agree to provide funding to the
Company in addition
------------
[***] Omitted pursuant to a request for confidential treatment. The omitted
material has been separately filed with the Securities and Exchange
Commission.
19
to the funding referred to in Clause 6.2.1. and Clause 6.2.2, as
shall be necessary for development of the Products, as shall be
reasonably determined in good faith by the decision of the Company
Directors, including the EIS Company Director (or after the exercise
of the Exchange Right by at least one of the EIS Company Directors)
and at least one of the DOV Company Directors, that such subsequent
funding is required for the development of the Products in
accordance with the Business Plan or as otherwise approved by the
Company Directors, any such additional funding shall be contributed
by EIS and DOV [***] by way of additional capital in the Company,
whether in the form of gift, additional paid in capital or other
capital, or such other means as may be agreed by the Participants,
on the following terms:
(1) in minimum increments of [***] ;
(2) no more frequently than [***] times per calendar year; and
(3) in accordance with the Business Plan and the Research and
Development Plan.
6.2.4. In the case of the sums paid pursuant to Clauses 6.2.1 to 6.2.3.
inclusive, the Participants shall agree in good faith on the manner
by which additional capital is made so as to maintain their
respective interests on a PRO RATA basis, subject to the provisions
of Clause 6.4. In the event all or part of such sum is made by way
of paid up capital in the Shares of the Company, such Shares shall
be issued at the same price per Share as the Shares subscribed for
by EIS and DOV pursuant to Clause 5.2. PRO RATA to their ownership
of Shares in the Company.
6.2.5. The Company shall, immediately, upon receipt thereof, advance by way
of an interest free loan, subscription or gift by way of a capital
contribution, or such other means as may be agreed, as determined by
the Company Directors, to Nascime any and all amounts funded by the
Company by any of the Participants, and the Company and Nascime each
covenant and agree that such funds shall be applied by Nascime
solely as provided in the Business Plan.
6.3. The Company shall not, without the consent of each of the
Participants, (x) incur any indebtedness, liabilities or other
obligations, or issue any securities or other equity interests, or
(y) conduct any business other than its ownership of the shares and
funding of Nascime, as contemplated herein.
6.4. In the event that one Participant determines not to fund or not to
fund fully any amounts required (as approved by the EIS Company
Director(s) and the DOV Company Directors pursuant to Clause 6.2.2.
or Clause 6.2.3) to develop and commercialize the Products (as
opposed to one Product, which is dealt with in Clause 6.5. and
Clause 6.6.), in accordance with such Participant's equity ownership
in the Company, and the other Participant clearly demonstrates its
willingness and ability to fund its share of such funding, then the
defaulting Participant shall have 30 days to re-
------------
[***] Omitted pursuant to a request for confidential treatment. The omitted
material has been separately filed with the Securities and Exchange
Commission.
20
consider its decision not to provide additional funding. If the
defaulting Participant confirms its decision not to provide
additional funding or fails to confirm that it will provide such
additional funding within such time period, the non-defaulting
Participant shall acquire additional Shares in the Company based
upon the amounts funded by the non-defaulting Participant, as
follows:
(x) the price per unit for such additional Shares shall be the
same as the price per share at the Effective Date;
(y) such Participant shall acquire [***] units of "A" Shares or
"B" Non-Voting Shares, as the case may be, (rather than one)
for each unit that it would otherwise be entitled to acquire
without giving effect to this clause (y); and
(z) in determining the number of Shares to be issued to the
non-defaulting Participant, the Participants shall agree in
good faith on the manner by which the additional funding is to
be made by the non-defaulting Participant, so that subject to
the additional funding, the Participants maintain their
respective interests on a PRO RATA basis, having regard to the
proportion that the additional financing bears to the amounts
previously advanced by the Participants to the Company by way
of paid in capital or other capital, or such other means as
may have been agreed by the Participants , and the proportion
that the Shares bear to the amounts previously advanced by the
Participants to the Company other than by way of Shares.
A non-defaulting Participant shall be a Participant that provides
its required portion of any such funding and a defaulting
Participant shall be a Participant that fails to fund its portion of
any such funding.
6.5. If the Management Committee declines to develop or commercially
exploit a Product and all the Projects for the applicable Compound
are terminated by agreement of the Parties, DOV may develop and
commercially exploit formulation(s) of such Compound and in
connection therewith may exploit the DOV Intellectual Property and
the Nascime Intellectual Property, subject to the Parties
negotiating a license agreement in good faith pursuant to which
Nascime will xxxxx XXX a license to the relevant portion of the
Nascime Intellectual Property. The financial terms of the said
license agreement shall have regard, inter alia, to:
6.5.1. the amount of monies expended by Nascime in developing
the Nascime Intellectual Property and the DOV
Intellectual Property;
6.5.2. the materiality of the contribution of (i) the Nascime
Intellectual Property and the (ii) DOV Intellectual
Property generated at the cost of Nascime by comparison
to the further research and development work to be
conducted by or on behalf of DOV or an affiliate; and
------------
[***] Omitted pursuant to a request for confidential treatment. The omitted
material has been separately filed with the Securities and Exchange
Commission.
21
6.5.3. the financial return likely to be earned by DOV from the
proposed exploitation of the foregoing product(s).
6.6. If the Management Committee declines to develop or commercially
exploit a Product and all the Projects for the applicable Compound
are terminated by agreement of the Parties, Elan may develop and
commercially exploit formulation(s) of such Compound and in
connection therewith may exploit the Elan Intellectual Property and
the Nascime Intellectual Property, subject to the Parties
negotiating a license agreement in good faith pursuant to which
Nascime will grant Elan a license to the relevant portion of the
Nascime Intellectual Property. The financial terms of the said
license agreement shall have regard, inter alia, to:
6.6.1. the amount of monies expended by Nascime in developing
the Nascime Intellectual Property and the Elan
Intellectual Property;
6.6.2. the materiality of the contribution of (i) the Nascime
Intellectual Property and the (ii) Elan Intellectual
Property generated at the cost of Nascime by comparison
to the further research and development work to be
conducted by or on behalf of Elan; and
6.6.3. the financial return likely to be earned by Elan from
the proposed exploitation of the foregoing product(s).
6.7. If each of the Participants consent, Nascime can borrow or secure
funding from financial institutions and other similar sources on the
most favourable terms reasonably obtainable as to interest,
repayment and security.
6.8. The unconditional donations or gifts of cash to the Company as
contributed surplus by both EIS and DOV as detailed herein are made
to the Company pursuant to an undertaking and agreement reached
between EIS and DOV solely and, accordingly, the Company has no
legal right and hereby acknowledges that it has no legal right to
make demand for or otherwise seek to enforce the contribution to
surplus undertakings by EIS and DOV respectively as set forth
herein. Provided however, that EIS and DOV shall at all times as
between each other have the right to enforce each other's respective
obligation to contribute to the capital of the Company as provided
herein.
CLAUSE 7
DIRECTORS
THE COMPANY
7.1. DOV shall have the right to nominate two Company and EIS shall have
the right to nominate one Company Director. DOV may appoint one of
the Company Directors to
22
serve as the chairman of the Company as and from the Effective Date.
The chairman of the Company shall hold office until the first
meeting of the Directors after the exercise by EIS of the Exchange
Right. In the event that the Exchange Right is exercised at any time
by EIS each of DOV, EIS, or EIS's designee, shall cause the board of
directors of the Company to be reconfigured so that an equal number
of Directors are designated by EIS and DOV. Thereafter, each of EIS
and DOV, beginning with EIS, shall have the right, exercisable
alternatively, of nominating one of the Company Directors to be
chairman of the Company for a term of one year. If the chairman of
the Company is unable to attend any meeting of the Company
Directors, the Company Directors of the same designation shall be
entitled to appoint another Company Director to act as chairman in
his place at the meeting.
7.2. In the case of an equality of votes at a meeting of the meeting of
the Company Directors, the chairman of Nascime shall not be entitled
to a second or casting vote.
7.3. If either EIS or DOV removes a Company Director, EIS or DOV as the
case may be shall be responsible for and shall indemnify the other
Participant and the Company against any claim by such Company
Director arising from such removal.
7.4. The Company Directors shall meet not less than two times in each
Financial Year and all Company Directors' meetings shall be held in
Bermuda to the extent required pursuant to the laws of Bermuda or to
ensure the sole residence of the Company in Bermuda.. The quorum for
each such meeting shall be two Company Directors being at least one
EIS and at least one DOV Director. In the event of any meeting being
inquorate the meeting shall be adjourned for a period of seven days.
A notice shall be sent to the EIS Directors and the DOV Directors
specifying the date and time and place where such adjourned meeting
is to be held and reconvened. At such adjourned meeting, the Company
Directors present shall constitute the quorum required; provided
always that such quorum shall include at least one EIS Director and
one DOV Director.
NASCIME
7.5. DOV shall have the right to nominate four Nascime Directors and EIS
shall have the right to nominate one Nascime Director. DOV may
appoint one of the Nascime Directors to be the chairman of Nascime
as and from the Effective Date. The chairman of Nascime shall hold
office until the first meeting of the Nascime Directors after the
exercise by EIS of the Exchange Right. In the event that the
Exchange Right is exercised at any time by EIS each of DOV, EIS, or
EIS's designee, shall cause the board of directors of Nascime to be
reconfigured so that an equal number of Nascime Directors are
designated by EIS and DOV. Thereafter, each of EIS and DOV,
beginning with EIS, shall have the right, exercisable alternatively,
of nominating one of the Nascime Directors to be chairman of Nascime
for a term of one year. If the chairman of Nascime is unable to
attend any meeting of the Nascime Directors, the Nascime Directors
of the same designation shall be entitled to appoint another
23
Nascime Director to act as chairman of Nascime in his place at the
meeting.
7.6. In the case of an equality of votes at a meeting of the board of
directors of Nascime, the chairman of Nascime shall not be entitled
to a second or casting vote.
7.9. If either EIS or DOV removes a Nascime Director, EIS or DOV as the
case may be shall be responsible for and shall indemnify the other
Participant and Nascime against any claim by such Company Director
arising from such removal.
7.10. The Nascime Directors shall meet not less than three times in each
Financial Year and all Nascime Directors' meetings shall be held in
Ireland. The quorum for each such meeting shall be three Nascime
Directors being at least one Nascime Director nominated by EIS and
at least one Nascime Director nominated by DOV, at least two of whom
shall be resident in Ireland. In the event of any meeting being
inquorate the meeting shall be adjourned for a period of seven days.
A notice shall be sent to each of the Nascime Directors specifying
the date and time and place where such adjourned meeting is to be
held and reconvened. At such adjourned meeting, the Nascime
Directors present shall constitute the quorum required; provided
always that such quorum shall include at least one Nascime Director
nominated by EIS and at least one Nascime Director nominated by DOV,
at least two of whom shall be resident in Ireland.
CLAUSE 8
DIRECTION OF RESEARCH AND DEVELOPMENT
8.1. The Management Committee shall be responsible for, INTER ALIA,
devising, implementing and reviewing strategy for the Business and,
in particular, devising Nascime's strategy for research and
development in relation to the Products in the Field and to monitor
and supervise the implementation of such strategy. for research and
development.
8.2. The Nascime Directors shall appoint a management committee (the
"MANAGEMENT COMMITTEE") to perform certain operational functions,
such delegation to be consistent with the Nascime Directors' right
to delegate powers pursuant to the Nascime Memorandum and Articles
of Association. The Management Committee shall consist initially of
four members, two of whom shall be nominated by the Nascime
Director(s) designated by EIS and two of whom shall be nominated by
the Nascime Directors designated by DOV, and each of whom shall be
entitled to one vote in person or in proxy at any Management
Committee meeting. The initial members shall be nominated by EIS and
DOV as soon after the Effective Date as is practicable. The Nascime
Directors shall be entitled to remove any of their nominees to the
Management Committee and appoint a replacement in place of any
nominees so
24
removed. The number of individuals on the Management Committee may
be altered if agreed to by the Nascime Directors provided that each
of the Nascime Directors designated by EIS and DOV respectively
shall be entitled to appoint an equal number of members to the
Management Committee.
8.3. The Nascime Directors shall appoint a research and development
committee (the "R&D Committee") which shall initially be comprised
of four members, with an equal number being nominated by the Nascime
Director(s) designated by EIS and two of whom shall be nominated by
the Nascime Directors designated by DOV and each of whom shall have
one vote in person or in proxy at any R&D Committee meeting during
which research and development issues are discussed. The initial
members of the R&D Committee shall be nominated by EIS and DOV as
soon after the Effective Date as is practicable. The nominees of the
EIS Nascime Directors to the Management Committee and the nominees
of the DOV Nascime Directors to the Management Committee shall be
entitled to remove any of their nominees to the R&D Committee and
appoint a replacement in place of any nominees so removed. The
number of members of the R&D Committee may be altered if agreed to
by the Management Committee provided that each of Nascime Directors
designated by EIS and DOV respectively shall be entitled to appoint
an equal number of members to the R&D Committee.
8.4. The R&D Committee shall be responsible for the design and
implementation of the Research and Development Programmes for
Nascime and shall meet at regular intervals to monitor the progress
of the Research and Development Programmes and to report on their
progress to the Management Committee.
8.5. The Management Committee shall promptly report all significant
developments to the Nascime Directors on the occurrence thereof and,
in addition, shall report at quarterly intervals to the Nascime
Directors. Any dispute or deadlock among the members of the
Management Committee shall be referred by it to the Nascime
Directors; provided that in determining such dispute or deadlock the
provisions of Clause 17 shall be applicable.
8.6. In the event of any dispute among members of the R&D Committee, the
R&D Committee shall refer such dispute to the Management Committee
whose decision on the dispute shall be binding on the R&D Committee.
8.7. DOV and Elan shall provide such research and development services as
may reasonably be required by Nascime in accordance with the
provisions of the License Agreements. Nascime shall pay Elan and DOV
for any research and development work carried out by them on behalf
of Nascime at the end of each month during the Research and
Development Programme, subject to the proper vouching of research
and development work and expenses. An invoice shall be issued to
Nascime by Elan or DOV, as applicable, by the 15th day of the month
following the month in which
25
work was performed. The payments by Nascime to Elan and DOV shall be
calculated by reference to the costs incurred by Elan and DOV [***]
in carrying out such research and development work, [***] . Research
and development activities outsourced to third party providers shall
be charged to Nascime at the amount invoiced by the third party
without premium.
8.8. On not more than two times in each Financial Year, Elan and DOV
shall permit Nascime or its duly authorised representative on
reasonable notice and at any reasonable time during normal business
hours to have access to inspect and audit the accounts and records
of Elan and any other book, record, voucher, receipt or invoice
relating to the calculation or the cost of the Research and
Development Programme and to the accuracy of the reports which
accompanied them. Any such inspection of Elan's or DOV's records, as
the case may be shall be, at the expense of Nascime, except that if
any such inspection reveals an overpayment in the amount paid to
Elan or DOV, as the case may be, for the Research and Development
Programme hereunder in any Financial Year of five percent (5%) or
more of the amount actually due to Elan or DOV as the case may be,
then the expense of such inspection shall be borne solely by Elan or
DOV as the case may be instead of by Nascime. Any surplus over the
sum properly payable by Nascime to Elan or DOV, as the case may be,
shall be paid promptly by Elan or DOV, as the case may be, to
Nascime. If such inspection reveals a deficit in the amount of the
sum properly payable to Elan or DOV, as the case may be, by Nascime,
Nascime shall pay the deficit to Elan or DOV, as the case may be.
8.9. Elan shall be responsible for the Controlled Release formulation
development for the Products and shall provide the necessary
resources and expertise to conduct such development. Elan shall
conduct and be responsible for all formulation development,
analytical testing, scale-up, process validation, manufacturing,
stability testing, clinical trials materials generation and pilot
and pivotal animal and human biopharmaceutical trials for the
Products. Elan shall be paid by Nascime for such work in accordance
with the provisions set forth in Clause 8.7.
8.10. DOV shall be responsible at its own cost for the collation and
provision of all currently available data and information pertaining
to chemistry, pharmacology, carcinogenicity, toxicology, safety,
efficacy, handling and storage of the Compounds. DOV, at Nascime's
cost pursuant to Clause 8.7, shall be responsible for any additional
chemistry, pharmacology, carcinogenicity, toxicology, safety,
efficacy, handling and storage of the Compounds and any further
development as may be required to support the development of the
Products, their testing in biopharmaceutical and Phase II human
clinical trials and the filing and approval of IND and NDA
submissions. DOV shall be primarily responsible for sourcing
supplies of the Compounds for the manufacture of the Products and to
conduct its part of the Research and Development Plan. DOV shall be
paid by Nascime for such work in accordance with the provisions set
forth in Clause 8.7.
------------
[***] Omitted pursuant to a request for confidential treatment. The omitted
material has been separately filed with the Securities and Exchange
Commission.
26
CLAUSE 9
THE BUSINESS PLAN AND REVIEWS
9.1. Within [***] days of the Effective Date, Elan and DOV shall agree
upon the Business Plan. Each Financial Year thereafter, the Nascime
Directors shall meet to confirm, amend or restate the Business Plan
for the following Financial Year.
9.2. Nascime shall diligently pursue the research and development of the
Products insofar as is required to carry out the Business Plan and
the Research and Development Plan.
9.3. The Participants agree that the Management Committee shall submit to
the Nascime Directors on 15th May, 15th August, 15th November and
15th February or as soon as reasonably practicable thereafter in
each Financial Year a report on the performance of the business and
research and development activities of Nascime and the Nascime
Directors shall hold such meeting as may be necessary to review the
performance of Nascime against the Business Plan for the current
Financial Year.
CLAUSE 10
PROPERTY OWNERSHIP RIGHTS
10.1. Elan shall remain proprietor of the Elan Intellectual Property,
which for the avoidance of doubt shall include the Elan
Improvements.
10.2. DOV shall remain proprietor of the DOV Intellectual Property, which
for the avoidance of doubt shall include the DOV Improvements.
10.3. All intellectual property, including know-how, arising out of the
conduct of the Project by any Person, except to the extent such
intellectual property constitutes DOV Intellectual Property or Elan
Intellectual Property, shall constitute Nascime Intellectual
Property.
10.4. Subject to the provisions of Clause 10.7 and this Clause 10.4,
Nascime hereby grants to each of Elan and DOV a license to the
Nascime Intellectual Property as follows:
10.4.1. In circumstances where the Nascime Intellectual Property
relates predominantly to the Elan Intellectual Property,
Nascime hereby grants to Elan a worldwide, perpetual,
fully-paid and royalty-free license, with the right to
sublicense, to the Nascime Intellectual Property outside
the Field on an as-is basis without recourse,
representation or warranty whether express or implied,
including warranties of merchantability or fitness for a
particular purpose, or
------------
[***] Omitted pursuant to a request for confidential treatment. The omitted
material has been separately filed with the Securities and Exchange
Commission.
27
infringement of third party rights, and all such
warranties are expressly disclaimed.
10.4.2. In circumstances where the Nascime Intellectual Property
relates predominantly to the DOV Intellectual Property,
Nascime hereby grants to DOV a worldwide, perpetual,
fully-paid and royalty-free license, with the right to
sublicense, to the Nascime Intellectual Property outside
the Field on an as-is basis without recourse,
representation or warranty whether express or implied,
including warranties of merchantability or fitness for a
particular purpose, or infringement of third party
rights, and all such warranties are expressly
disclaimed.
10.5. Solely for the purpose of and insofar as is necessary, in each case,
to permit Elan to perform its obligations pursuant to this
Agreement, Nascime hereby grants to Elan for the term of the
Licenses a non-exclusive, worldwide, royalty-free, fully paid-up
license (i) to use the Nascime Intellectual Property in the Field,
and (ii) subject to the terms and conditions of the DOV License, a
sublicense to use the DOV Intellectual Property in the Field.
10.6. Solely for the purpose of and insofar as is necessary, in each case,
to permit DOV to perform its obligations pursuant to this Agreement,
Nascime hereby grants to DOV for the term of the Licenses a
non-exclusive, worldwide, royalty-free, fully paid-up license (i) to
use the Nascime Intellectual Property in the Field, and (ii) subject
to the terms and conditions of the Elan License Agreement, a
sublicense to use the Elan Intellectual Property in the Field.
10.7. Nothing in this Agreement shall prevent DOV from developing or
commercializing a product containing either of the Compounds for
intravenous delivery provided that DOV complies with the provisions
of this Clause 10.7. DOV shall be entitled to exploit the Nascime
Intellectual Property and the DOV Intellectual Property to develop
and commercialize one or more products containing either of the
Compounds for intravenous delivery subject to the Parties
negotiating a license agreement in good faith pursuant to which
Nascime will xxxxx XXX a license to the relevant portion of the
Nascime Intellectual Property. The financial terms of the said
license agreement shall have regard, inter alia, to:
10.7.1. the amount of monies expended by Nascime in developing
the Nascime Intellectual Property and the DOV
Intellectual Property;
10.7.2. the materiality of the contribution of (i) the Nascime
Intellectual Property and the (ii) DOV Intellectual
Property generated at the cost of Nascime by comparison
to the further research and development work to be
conducted by DOV; and
28
10.7.3. the financial return likely to be earned by DOV from the
proposed exploitation of the foregoing product(s).
CLAUSE 11
PATENT RIGHTS
11.1. Nascime shall permanently xxxx or otherwise use reasonable efforts
to cause any third party to permanently xxxx all Products and/or the
packaging therefor with such license or patent notices and in such
manner as a Participant may reasonably request in writing prior to
the sale or commercial use thereof.
11.2. The Participants shall be obliged to disclose promptly to Nascime
inventions made by or on behalf of the Participant in connection
with the performance of the Project, any patentable inventions and
discoveries within the Elan Intellectual Property or the DOV
Intellectual Property that relate to the Field and any patentable
Improvements developed by or on behalf of the Participant.
11.3. The Parties shall discuss in good faith all material issues relating
to filing, prosecution and maintenance of the Elan Patent Rights and
the DOV Patent Rights (insofar as such Patents are of relevance to
the Field) and any patentable inventions and discoveries within the
Elan Intellectual Property and the DOV Intellectual Property that
relate to the Field, and any patentable DOV Improvements or Elan
Improvements. Subject to agreement to the contrary, the provisions
of Clause 11.4 to Clause 11.14. shall be applicable.
11.4. Elan, at its expense, shall make a good faith effort (i) to secure
the grant of any patent applications within the Elan Patent Rights
that relate to the Field; (ii) to file and prosecute patent
applications on patentable inventions and discoveries within the
Elan Improvements that relate to the Field; (iii) to defend all such
applications against third party oppositions; and (iv) to maintain
in force any issued letters patent within the Elan Patent Rights
that relate to the Field (including any letters patent that may
issue covering any such Elan Improvements that relate to the Field).
Elan shall have the right in its discretion to control such filing,
prosecution, defence and maintenance provided that Nascime and DOV
at their request shall be provided with copies of all documents
relating to such filing, prosecution, defence and maintenance in
sufficient time to review such documents and comment thereon prior
to filing.
11.5. DOV, at its expense, shall make a good faith effort (i) to secure
the grant of any patent applications within the DOV Patent Rights
that relate to the Field; (ii) to file and prosecute patent
applications on patentable inventions and discoveries within the DOV
Improvements that relate to the Field; (iii) to defend all such
applications against third party oppositions; and (iv) to maintain
in force any issued letters patent within
29
the DOV Patent Rights that relate to the Field (including any
letters patent that may issue covering any such DOV Improvements
that relate to the Field). DOV shall have the right in its
discretion to control such filing, prosecution, defence and
maintenance provided that Elan and Nascime at their request shall be
provided with copies of all documents relating to such filing,
prosecution, defence and maintenance in sufficient time to review
such documents and comment thereon prior to filing.
11.6. In the event that a Party informs the other Parties that it does not
intend to file patent applications on patentable inventions and
discoveries within the DOV or Elan Intellectual Property as the case
may be that relate to the Field in one or more countries in the
Territory or fails to file such an application within a reasonable
period of time, Nascime shall have the option at its expense to file
and prosecute such patent application(s) in the joint names of
Nascime and the Party not intending or failing to so file. Upon
written request from Nascime, such Party shall execute all
documents, forms and declarations and to do all things as shall be
reasonably necessary to enable Nascime to exercise such option.
11.7. Nascime at its expense shall have the right but shall not be
obligated (i) to file and prosecute patent applications on
patentable inventions and discoveries within the Nascime
Intellectual Property; (ii) to defend all such applications against
third party oppositions; and (iii) to maintain in force any issued
letters patent within the Nascime Patent Rights (including any
patents that issue on patentable inventions and discoveries within
the Nascime Intellectual Property). Nascime shall have the right to
control such filing, prosecution, defence and maintenance provided
that other Parties shall be provided with copies of all documents
relating to such filing, prosecution, defence, and maintenance in
sufficient time to review such documents and comment thereon prior
to filing.
11.8. In the event that Nascime informs both Elan and DOV that it does not
intend to file an application on the Nascime Intellectual Property
in or outside the Field, Elan shall have the right to file and
prosecute such patent applications on inventions that Elan invents
solely or which relate predominantly to the Elan Intellectual
Property, and DOV shall have the right to file and prosecute such
patent applications on inventions which DOV invents solely or which
relate predominantly to the DOV Intellectual Property, and Elan and
DOV agree to negotiate in good faith on the course of action to be
taken with respect to joint inventions.
11.9. The Parties shall promptly inform each other in writing of any
alleged infringement of any patents within the Elan Patent Rights,
the DOV Patent Rights or the Nascime Patent Rights or any alleged
misappropriation of trade secrets within the Elan Intellectual
Property, the DOV Intellectual Property or the Nascime Intellectual
Property by a third party of which it becomes aware and provide the
others with any available evidence of such infringement or
misappropriation.
30
11.10. Nascime shall have the right to prosecute at its own expense and for
its own benefit any infringements of the Elan Patent Rights and the
DOV Patent Rights or misappropriation of the Elan Intellectual
Property and the DOV Intellectual Property, insofar as such
infringements or misappropriation relate solely to the Field. In the
event that Nascime takes such action, Nascime shall do so at its own
cost and expense. At Nascime's request, the Parties shall cooperate
with such action. Any recovery remaining after the deduction by
Nascime of the reasonable expenses (including attorney's fees and
expenses) incurred in relation to such infringement proceeding shall
belong to Nascime. Should Nascime decide not to pursue such
infringers, within a reasonable period but in any event within
twenty (20) days after receiving written notice of such alleged
infringement or misappropriation, each other Party may in its
discretion initiate such proceedings in its own name, at its expense
and for its own benefit, and at such Party's request, Nascime shall
cooperate with such action. Alternatively, the Parties may agree to
institute such proceedings in their joint names and shall reach
agreement as to the proportion in which they shall share the
proceeds of any such proceedings, and the expense of any costs not
recovered, or the costs or damages payable to the third party. If
the infringement of the Elan Patent Rights or the DOV Patent Rights
affects both the Field as well as other products being developed or
commercialized by DOV or Elan or its commercial partners outside the
Field, DOV or Elan shall endeavor to agree as to the manner in which
the proceedings should be instituted and as to the proportion in
which they shall share the proceeds of any such proceedings, and the
expense of any costs not recovered, or the costs or damages payable
to the third party.
11.11. Nascime shall have the first right but not the obligation to bring
suit or otherwise take action against any alleged infringement of
the Nascime Patent Rights or alleged misappropriation of the Nascime
Intellectual Property. If any such alleged infringement or
misappropriation occurs that gives rise to a cause of action both
inside and outside the Field, Nascime, in consultation with the
other Parties, shall determine the cause of action to be taken. In
the event that Nascime takes such action, Nascime shall do so at its
own cost and expense and all damages and monetary award recovered in
or with respect to such action shall be the property of Nascime.
Nascime shall keep Elan and DOV informed of any action in a timely
manner so as to enable DOV and Elan to provide input in any such
action and Nascime shall reasonably take into consideration any such
input. At Nascime's request, the Parties shall cooperate with any
such action at Nascime's cost and expense.
11.12. In the event that Nascime does not bring suit or otherwise take
action against all infringement of the Nascime Patent Rights or
misappropriation of the Nascime Intellectual Property (i) if only
one Party determines to pursue such suit or take such action at its
own cost and expense, it shall be entitled to all damages and
monetary award recovered in or with respect to such action and (ii)
if the other Parties pursue such suit or action outside of Nascime,
they shall negotiate in good faith an appropriate allocation of
costs, expenses and recovery amounts.
31
11.13. In the event that a claim is or proceedings are brought against
Nascime by a third party alleging that the sale, distribution or use
of a Product in the Territory or use of the Elan Intellectual
Property, the DOV Intellectual Property, or the Nascime Intellectual
Property as the case may be, infringes the intellectual property
rights of such party, Nascime shall promptly advise the other
Parties of such threat or suit.
11.14. Nascime shall indemnify, defend and hold harmless Elan or DOV, as
the case may be, against all actions, losses, claims, demands,
damages, costs and liabilities (including reasonable attorneys fees)
relating directly or indirectly to all such claims or proceedings
referred to in Clause 11.13, provided that Elan or DOV, as the case
may be, shall not acknowledge to the third party or to any other
person the validity of any claims of such a third party, and shall
not compromise or settle any claim or proceedings relating thereto
without the prior written consent to Nascime, not to be unreasonably
withheld or delayed. At its option, Elan or DOV, as the case may be,
may elect to take over the conduct of such proceedings from Nascime
provided that Nascime's indemnification obligations shall continue;
the costs of defending such claim shall be borne by Elan or DOV, as
the case may be and such Party shall not compromise or settle any
such claim or proceeding without the prior written consent of
Nascime, such consent not to be unreasonably withheld or delayed.
32
CLAUSE 12
EXPLOITATION OF PRODUCTS
12.1. Nascime shall diligently pursue the research, development,
prosecution and commercialization of the Products, as provided in
the Business Plan. In order to commercialize the Products, Nascime
shall use commercially reasonable efforts to obtain, or have
obtained for Nascime, marketing approval in such countries in the
Territory as is determined by the Business Plan. It may be necessary
to file an NDA and perform clinical testing in more than one
country. The strategy for the registration and the commercialisation
of the Products shall be determined by the Nascime Directors.
12.2. At any time during the development of the Products, Nascime may,
subject to the provisions of this Agreement, the Elan License
Agreement and the DOV License Agreement, license the marketing
rights to the Products to one or more marketing partners, or
otherwise commercialize the Products under an alternative strategy
to be agreed upon by Elan and DOV. Nascime shall be responsible for
negotiating with third parties commercially reasonable terms (e.g.
royalties, milestones, fees, profit sharing, manufacturing rights,
supply terms etc.) for the rights to be granted, but shall do so
under the commercial strategy agreed with Elan and DOV and shall
keep Elan and DOV informed throughout the negotiation process.
12.3. [***], for the term of the Elan License Agreement and the DOV
License Agreement ("OPTION PERIOD"), if Nascime wishes to
commercialize the marketing, sale or distribution of one or both of
the Products with or through a third party in all or part of the
Territory, Elan shall have an option to negotiate in good faith the
terms of such nature of marketing arrangement that Nascime wishes to
pursue with a third party for all or part of the Territory as is
applicable. The option shall be exercised if (i) Elan notifies
Nascime in writing that it wishes to enter into negotiations
referred to in this Clause 12.3, or (ii) in the event that Nascime
bona fide intends to market one or both of the Products with a third
party (for the purpose of this Clause 12.3, DOV shall be considered
a third party) in relation to all or part of the Territory, Nascime
notifies Elan in writing that it wishes Elan to elect to enter into
negotiations referred to in this Clause 12.3 and Elan notifies
Nascime in writing within twenty days of such notification that it
wishes to enter into negotiations to negotiate a marketing
arrangement.
12.4. If Nascime and Elan do not reach agreement on the terms of such an
agreement within three (3) months of commencing such negotiations,
then Nascime shall be free to offer third parties terms to develop,
purchase, license, distribute, co-market, or co-promote such product
which, when taken as a whole, are more favorable to Nascime than the
principal terms of the last written proposal offered to Nascime by
Elan, and by Nascime to Elan, as the case may be, in the applicable
part of the Territory. Prior to entering into such an agreement with
a third party, Nascime shall promptly notify Elan, in writing and
------------
[***] Omitted pursuant to a request for confidential treatment. The omitted
material has been separately filed with the Securities and Exchange
Commission.
33
in confidence, of the principal terms of such agreement. If Elan
notifies Nascime within [***] of such notice, that such terms
offered to a third party, when taken as a whole, are less favorable
to Nascime than those previously offered by Elan, then Nascime and
Elan shall have an additional [***] days to discuss why such terms
are or are not less favorable. If the Participants do not agree
within such [***] day period that such terms are not less favorable,
then such issue shall be immediately referred to an independent
certified public accounting firm acceptable to both Participants
which shall resolve such disagreement within [***] of the referral
to said firm. If the Participants do not agree within [***] period
on the identity of an independent certified public accounting firm
acceptable to the Parties, then each Party shall nominate an
independent certified public accounting firm, which independent
certified public accounting firms shall between them select an
independent certified public accounting firm acceptable to such
independent certified public accounting firms. If the Participants
agree, or it is reasonably determined by the independent certified
public accounting firm that the terms, when taken as a whole, are
less favorable to Nascime than Elan's final proposal to Nascime, or
Nascime's final proposal to Elan, as the case may be, then Nascime
shall be obliged to accept the Elan proposal to Nascime; provided
that Elan shall have [***] to finally accept or reject the proposal.
If accepted by Elan, the Participants shall negotiate in good faith
a final marketing agreement. If the option is exercised by Elan
within the Option Period, the restrictions set out in this paragraph
shall expire [***] after the option is exercised by Elan.
12.5. The provisions of Clause 20 shall not apply to a dispute arising
pursuant to Clause 12.
12A REGULATORY APPROVALS
12A.1. Subject to determination by Nascime that one or more NDAs and/or
regulatory approvals should be owned by a commercial partner of
Nascime such as a sublicensee, regulatory approvals related to the
Products shall be prosecuted and owned by Nascime and any and all
NDAs and other applications for regulatory approval filed hereunder
for any Product shall remain the property of Nascime, provided that
Nascime shall allow Elan and DOV access thereto to enable Elan and
DOV to fulfil their respective obligations and exercise their
respective rights under this Agreement and the License Agreements.
Nascime shall maintain such NDAs at its own cost.
12A.2. During all NDA registration procedure, each Party shall keep the
other Parties promptly and fully advised of such Party's
registration activities, progress and procedures. Each Party shall
inform the other Parties of any dealings such Party has with the FDA
or ORA and shall furnish the other Party with copies of all
correspondence. The Parties shall collaborate in relation to
obtaining any approval of the FDA or ORA for final approved
labelling.
------------
[***] Omitted pursuant to a request for confidential treatment. The omitted
material has been separately filed with the Securities and Exchange
Commission.
34
12A.3. Nascime shall at its sole cost file and shall use its reasonable
best efforts to prosecute to approval the NDAs for the Products in
the Territory.
12A.4. Nascime shall indemnify and hold harmless each of DOV and Elan,
their agents and employees from and against all claims, damages,
losses, liabilities and expenses to which either Elan, or DOV or
their respective employees, agents, partners, officers and directors
may become subject related to or arising out of Nascime's bad faith,
negligence or intentional misconduct in connection with the filing
or maintenance of the NDAs.
CLAUSE 13
NON-COMPETITION
13.1. During the term of the DOV License, DOV and its Affiliates shall not
compete with Nascime by developing or commercializing (including
without limitation licensing, sublicensing DOV's interests and
entitlements under the ACY Agreement, manufacturing or marketing) a
product with the same active ingredient as one of the Compounds
subject to the following:
13.1.1. If DOV acquires know-how or patent rights relating to
the Field, or if DOV acquires or merges with a third
party entity that has know-how or patent rights relating
to the Field, DOV shall offer to license such know-how
and patent rights to Nascime (subject to existing
contractual obligations), on commercially reasonable
terms on an arm's length basis. If Nascime determines
that Nascime should not acquire such license, DOV shall
be free to fully exploit such know-how and patent
rights, without the DOV Intellectual Property then
licensed to Nascime, whether inside or outside the Field
and to grant to third parties licenses and sublicenses
with respect thereto.
13.1.2. The provisions of Clause 6.5.
13.1.3. Nothing in this Agreement shall prevent DOV from
developing or commercializing a product containing
either of the Compounds for intravenous delivery,
subject to the provisions of Clause 10.7.
13.2. [***]
CLAUSE 14
------------
[***] Omitted pursuant to a request for confidential treatment. The omitted
material has been separately filed with the Securities and Exchange
Commission.
35
TECHNICAL SERVICES AND ASSISTANCE
14.1 Whenever commercially and technically feasible, Nascime shall
contract with DOV or Elan, as the case may be, to perform such other
services as Nascime may require, other than those specifically dealt
with in the License Agreements. In determining whether Elan or DOV
should provide such services, the Management Committee shall take
into account the respective infrastructure, capabilities and
experience of Elan and DOV.
14.2 Nascime shall if appropriate conclude an administrative support
agreement with Elan and/or DOV on such terms as the Parties thereto
shall in good faith negotiate. The management services required
shall include one or more of the following management services which
shall be requested by Nascime:
14.2.1. accounting, financial and other services;
14.2.2. tax services;
14.2.3. insurance services;
14.2.4. human resources services;
14.2.5. legal and company secretarial services;
14.2.6. patent and related intellectual property services; and
14.2.7. all such other services consistent with and of the same
type as those services to be provided pursuant to this
Agreement, as may be required.
The foregoing list of services shall not be deemed exhaustive and
may be changed from time to time upon written request by Nascime.
14.3. Subject to further agreement between the Participants, the
Participants agree that each Participant shall effect and maintain
comprehensive general liability insurance in respect of all clinical
trials and other activities performed by them on behalf of Nascime.
The Participants and Nascime agree to ensure that the industry
standard insurance policies shall be in place for all activities to
be carried out by Nascime. In the event that the Participant
concerned incurs additional insurance in respect of clinical trials
conducted for and on behalf of Nascime, such additional charges
shall be reimbursed by [***] pursuant [***].
14.4.1 If Elan or DOV so requires, DOV or Elan, as the case may be, shall
receive, at times and for periods mutually acceptable to the
Parties, employees of the other (such employees to be acceptable to
the receiving Party in the matter of qualification and
------------
[***] Omitted pursuant to a request for confidential treatment. The omitted
material has been separately filed with the Securities and Exchange
Commission.
36
competence) for instruction in respect of the Elan Intellectual
Property or the DOV Intellectual Property, as the case may be, as is
necessary to further the Research and Development Programmes.
14.4.2. The employees received by Elan or DOV, as the case may be, shall be
subject to obligations of confidentiality no less stringent than
those set out in Clause 22 and such employees shall observe the
rules, regulations and systems adopted by the party receiving the
said employees for its own employees or visitors.
CLAUSE 15
MANUFACTURING AND SUPPLY ARRANGEMENTS
15.1. It is the expectation of the Parties that Nascime shall enter into a
supply agreement with Elan to allow for the commercial production of
the Products on behalf of Nascime. Any such supply agreement shall
be negotiated and agreed by the Parties not later than the date of
termination of Phase II (as such term is commonly used in connection
with FDA applications) of the research and development programme for
a Product. The terms of the supply agreement shall be on commercial
terms, and shall be negotiated in good faith by the Parties.
37
CLAUSE 16
AUDITORS; BANKERS; REGISTERED OFFICE
ACCOUNTING REFERENCE DATE; SECRETARY; COUNSEL.
16.1 Unless otherwise agreed by the Participants and save as may be
provided to the contrary herein:
16.1.1. the auditors of the Company shall be KPMG whose
engagement shall have due regard to the reasonable
requirements of DOV with regard to preparation and audit
of the consolidated financial statements of DOV;
16.1.2. the bankers of the Company shall be the Bank of Bermuda
or such other bank as may be mutually agreed from time
to time;
16.1.3. the accounting reference date of the Company shall be 31
December in each Financial Year; and
16.1.4. the secretary of the Company shall be such Person as may
be appointed by the Company Directors from time to time.
16.2 Unless otherwise agreed by the Participants and save as may be
provided to the contrary herein:
16.2.1. the auditors of Nascime shall be KPMG whose engagement
shall have due regard to the reasonable requirements of
DOV with regard to preparation and audit of the
consolidated financial statements of DOV;
16.2.2. the bankers of Nascime shall be the Bank of Ireland or
such other bank as may be mutually agreed from time to
time;
16.2.3. the accounting reference date of Nascime shall be 31
December in each Financial Year; and
16.2.4. the secretary of Nascime shall be Matsack Trust Limited
or such other Person as may be appointed by the Nascime
Directors from time to time.
38
CLAUSE 17
SHARE RIGHTS AND DIRECTORS
17.1. The Participants agree that the "A" Shares and the "B" Non-Voting
Shares shall be separate classes of shares and, save only as
provided in Clauses 17.2 and 17.3, shall rank PARI PASSU in all
respects and shall carry the respective rights to dividends and be
subject to the restrictions on the transfer and distribution of
assets provided in the Company Memorandum of Association and as set
forth in this Agreement.
17.2. Save the right of EIS to nominate a Company Director pursuant to
Clause 7.1, the Participants agree that the "B" Non-Voting Shares
shall not carry voting rights in the Company. The "B" Non-Voting
Shares will not carry a right to the payment to dividends or other
distributions of the Company.
17.3. The Participants and Company hereby agree that EIS shall at all
times, upon 7 days' prior written notice to the company secretary of
Company, be entitled to redesignate and convert the "B" Non-Voting
Shares issued by the Company to EIS hereunder:
17.3.1 as "B" Non-Voting Shares ranking PARI PASSU in all
respects with the "A" Shares issued by the Company to
DOV hereunder, including as to voting rights in the
Company and the right to the payment of dividends and
other distributions of the Company;
17.3.2 as "B" voting Shares ranking PARI PASSU in all respects
with the "A" Shares issued by the Company to DOV
hereunder (including as to voting rights in the Company)
but without having the right to the payment of dividends
and other distributions of the Company; or
17.3.3 as "B" Non-Voting Shares ranking PARI PASSU in all
respects with the "A" Shares issued by the Company to
DOV hereunder (including the right to the payment of
dividends and other distributions of the Company) but
without having voting rights in the Company.
CLAUSE 18
MATTERS REQUIRING PARTICIPANTS' APPROVAL
18.1 Subject to the provisions of Clause 18.2, in consideration of DOV
and Elan agreeing to enter into the License Agreements, the Parties
hereby agree that neither the Company nor Nascime or any other
Subsidiary of the Company shall without the prior approval of each
of the Participants:
39
18.1.1. engage in any activity other than the Business;
18.1.2. sell the principal assets, undertaking or Business of
the Company or Nascime;
18.1.3. create any fixed or floating charge, lien (other than a
lien arising by operation of law) or other Encumbrance
over the whole or any part of the undertaking, property
or assets of the Company or Nascime or of any other
Subsidiary, except for the purpose of securing the
indebtedness of the Company or Nascime to its bankers
for sums borrowed in the ordinary and proper course of
the Business;
18.1.4. borrow any sum (except from the Company's or Nascime's
bankers in the ordinary and proper course of the
Business) in excess of a maximum aggregate sum
outstanding at any time of [***];
18.1.5. make any loan or advance or give any credit (other than
normal trade credit) in excess of [***] to any Person,
except for the purpose of making deposits with bankers;
18.1.6. give any guarantee or indemnity to secure the
liabilities or obligations of any Party other than those
which it is usual to give in the ordinary course of a
business similar to the Business;
18.1.7. sell, transfer, lease, assign, or otherwise dispose of
part of the undertaking, property and/or assets other
than stock or assets (or any interest therein) which are
surplus to the requirements of the Company or Nascime or
any other Subsidiary, or contract so to do where the
value of the undertaking property and/or assets exceed
[***];
18.1.8. enter into any contract, arrangement or commitment
involving expenditure on capital account or the
realisation of capital assets if the amount or the
aggregate amount of such expenditure or realisation by
the Company or Nascime and all of the other Subsidiaries
of the Company would exceed [***] in any one year or
in relation to any one project, and for the purpose of
this paragraph the aggregate amount payable under any
agreement for hire, hire purchase or purchase on credit
sale or conditional sale terms shall be deemed to be
capital expenditure incurred in the year in which such
agreement is entered into;
18.1.9. issue any unissued Shares or create or issue any new
shares (including a split of the Shares), except as
expressly permitted by the Company Memorandum and
Articles of Association or by the Nascime Memorandum and
Articles of Association;
------------
[***] Omitted pursuant to a request for confidential treatment. The omitted
material has been separately filed with the Securities and Exchange
Commission.
40
18.1.10. subject to the provisions of Clause 17.3 alter any
rights attaching to any class of share in the capital of
the Company or Nascime or alter the Company Memorandum
and Articles of Association or the Nascime Memorandum
and Articles of Association;
18.1.11. consolidate, sub-divide or convert any of the Company's
or Nascime share capital or in any way alter the rights
attaching thereto;
18.1.12. dispose of Nascime or of any shares in Nascime, or
create, acquire or dispose of any other Subsidiary or of
any shares in any other Subsidiary;
18.1.13. enter into any partnership or profit sharing agreement
with any Person other than arrangements with trade
representatives and similar Persons in the ordinary
course of business;
18.1.14. do or permit or suffer to be done any act or thing
whereby the Company or Nascime may be wound up (whether
voluntarily or compulsorily), save as otherwise
expressly provided for in this Agreement;
18.1.15. issue any debentures or other securities convertible
into shares or debentures or any share warrants or any
options in respect of Shares or shares in Nascime;
18.1.16. enter into any contract or transaction except in the
ordinary and proper course of the Business on arm's
length terms;
18.1.17. acquire, purchase or subscribe for any shares,
debentures, mortgages or securities (or any interest
therein) in any company, trust or other Person;
18.1.18. adopt any employee benefit programme or incentive
schemes;
18.1.19. engage any new employee at remuneration which could
exceed the rate of [***] per annum;
18.1.20. pay any remuneration to the Company Directors or the
Nascime Directors by virtue of holding such office other
than Directors or Nascime Directors who hold executive
office;
18.1.21. licence or sub-licence any of the Elan Intellectual
Property, DOV Intellectual Property, Nascime
Intellectual Property;
18.1.22. amend or vary the terms of the DOV Licence Agreement,
the ACY Agreement or the Elan License Agreement;
18.1.23. permit a person other than Nascime to own an IND, NDA or
regulatory
------------
[***] Omitted pursuant to a request for confidential treatment. The omitted
material has been separately filed with the Securities and Exchange
Commission.
41
approval relating to the Product(s);
18.1.24. change the authorised signatories on the Company or
Nascime bank accounts; or
18.1.25. amend or vary the Business Plan or agree the Budget.
18.2. Upon the earlier of (i) four years from the Effective Date and (ii)
the date, if any, on which the ownership of the "B" Non-Voting
Shares by EIS or its Affiliates represents less than 80% of the "A"
Shares owned by DOV or its Affiliates, assuming exercise of the
Exchange Right, all action of the board of the Company Directors and
the Nascime Directors shall require only a majority of directors
(which majority need not include the EIS designee), except as
provided in the next sentence. If during any Financial Year Nascime
shall have incurred expenditure in excess of the budget agreed to by
the Nascime Directors by more than [***]% of such agreed budgeted
amount, any and all actions of the board of the Company Directors
and the Nascime Directors shall require approval of EIS's designee
and at least one of DOV's designees to the board of the Company
Directors and the Nascime Directors, as the case may be, until such
time as Nascime expenses for a Financial Year do not exceed the
agreed budget by more than [***]%.
CLAUSE 19
TRANSFER OF OR CHARGING OF SHARES
19.1 No Participant shall transfer any of its legal and/or beneficial
interest in the Shares held by it to any other Person, other than to
its Affiliates or other Persons in which that Participant or its
Affiliates may have an interest, by contract, ownership of
securities or otherwise, and that are in the nature of financing
vehicles or similar entities for such Participant or its Affiliates.
19.2 No Participant shall, except with the prior written consent of the
other Participant, create or permit to subsist any pledge, lien or
charge over, or grant any option or other rights or dispose of any
interest in, all or any of the Shares held by it (other than by a
transfer of such Shares in accordance with the provisions of this
Agreement) made by it to the Company unless any Person in whose
favour any such pledge, lien, or charge is created or permitted to
subsist or such option or rights are granted or such interest is
disposed of shall be expressly subject to and bound by all the
limitations and provisions which are embodied in this Agreement.
------------
[***] Omitted pursuant to a request for confidential treatment. The omitted
material has been separately filed with the Securities and Exchange
Commission.
42
CLAUSE 20
DISPUTES
20.1 Should any dispute or difference arise between Elan and DOV, or
between Elan or DOV and the Company and/or Nascime, during the
period that this Agreement is in force, other than a dispute or
difference relating to (i) the interpretation of any provision of
this Agreement, (ii) the interpretation or application of law, or
(iii) the ownership of any intellectual property, then any Party may
forthwith give notice to the other Parties that it wishes such
dispute or difference to be referred to the chief executive officers
of the Participants.
20.2 In any event of a notice being served in accordance with Clause
20.1, each of the Participants shall within 14 days of the service
of such notice prepare and circulate to the chief executive officer
of each Participant a memorandum or other form of statement setting
out its position on the matter in dispute and its reasons for
adopting that position. Each memorandum or statement shall be
considered by the chief executive officers of the Participants who
shall endeavour to resolve the dispute. If the chief executive
officers of the Participants agree upon a resolution or disposition
of the matter, they shall each sign a statement which sets out the
terms of their agreement. The Participants agree that they shall
exercise the voting rights and other powers available to them in
relation to the Company to procure that the agreed terms are fully
and promptly carried into effect.
20.3. Subject to the provisions of Clause 12.4, the chief executive
officers of the Participants shall, if they are unable to resolve a
dispute or difference when it is referred to them under Clause 20.1,
refer the matter to an independent US based expert who is
knowledgeable of the pharmaceutical/biotechnology/medical devices
industries (the "EXPERT"). The Expert shall be selected by the
presiding justice of the Supreme Court of the State of New York
sitting in the County, City and State of New York (the "PRESIDING
JUSTICE") or, if he should have a conflict of interest, by such
other Person as such justice shall select, having assured himself as
to such Person's independence. In each case, the Expert shall be
selected having regard to his suitability to determine the
particular dispute or difference on which he is being requested to
determine. Unless otherwise agreed between the chief executive
officers, the following rules shall apply to the appointment of the
Expert. The fees of the Expert shall be shared equally between the
Parties in dispute. The Expert shall be entitled to inspect and
examine all documentation and any other material which he may
consider to be relevant to the dispute. He shall afford each Party a
reasonable opportunity (in writing or orally) of stating reasons in
support of such contentions as
43
each Party may wish to make relative to the matters under
consideration. The Expert shall give notice in writing of his
determination to the Parties within such time as may be stipulated
in his terms of appointment or in the absence of such stipulation as
soon as practicable but in any event within four weeks from the
reference of the dispute or difference to him.
20.4. Any determination by the Expert of a dispute or difference shall not
be final and binding on the Parties provided however that any
determination by the Expert of a dispute or difference referred by
the Parties pursuant to Clause 21.1.3. shall be final and binding on
the Parties.
20.5. In the event that the Participants fail to resolve any dispute
pursuant to this Clause 20, each Participant shall be entitled to
offer to purchase all (but not some only) of the other Participant's
Shares and the Participants shall for a period of sixty (60) days
negotiate in good faith the terms of any such purchase.
CLAUSE 21
TERMINATION
21.1 For the purpose of this Clause 21, a "Relevant Event" is committed
or suffered by Elan or DOV if:
(i) it commits a material breach of its obligations under this
Agreement or the applicable License Agreement and, in the case
of a breach capable of remedy, fails to remedy it within 60
days of being specifically required in writing to do so by the
other Participant; provided, that if the breaching Participant
has proposed a course of action to rectify the breach and is
acting in good faith to rectify same but has not cured the
breach by the 60th day, such period shall be extended by such
period as is reasonably necessary to permit the breach to be
rectified;
(ii) a distress, execution, sequestration or other process is
levied or enforced upon or sued out against a material part of
its property which is not discharged or challenged within 20
days;
(iii) it is unable to pay its debts in the normal course of
business;
(iv) it ceases or threatens to cease wholly or substantially to
carry on its business, otherwise than for the purpose of a
reconstruction or amalgamation, without the prior written
consent of the other Participant (such consent not to be
unreasonably withheld);
44
(v) the appointment of a liquidator, receiver, administrator,
examiner, trustee or similar officer of such Participant or
over all or a substantial part of its assets under the law of
any applicable jurisdiction, including without limit, the
United States of America, Bermuda or Ireland;
(vi) an application or petition for bankruptcy, corporate
re-organisation, composition, administration, examination,
arrangement or any other procedure similar to any of the
foregoing under the law of any applicable jurisdiction,
including without limitation, the United States of America,
Bermuda or Ireland, is filed, and is not discharged within 60
days, or a Participant applies for or consents to the
appointment of a receiver, administrator, examiner or similar
officer of it or of all or a material part of its assets,
rights or revenues or the assets and/or the business of a
Participant are for any reason seized, confiscated or
condemned.
21.1.1 If either Participant commits or suffers a Relevant Event, the other
Participant shall be entitled, within three months of its becoming
aware of the occurrence of the Relevant Event, to require the
defaulting Participant (the "RECIPIENT PARTICIPANT") to sell on
reasonable terms of payment to the non defaulting Participant (the
"PROPOSING PARTICIPANT") all (but not some only) of the Shares, held
or beneficially owned by the Recipient Participant for an amount
equal to [***]% of the fair market value of the Shares of the
Recipient Participant.
21.1.2 In the case of Clause 21.1.1, the Proposing Participant shall notify
the Recipient Participant of the exercise of this option by
delivering written notice to the Recipient Participant stating that
the option is exercised and the price at which the Proposing
Participant is willing to purchase the Shares of the Recipient
Participant.
21.1.3 In the event that the Participants do not agree upon a purchase
price for the Financings within [***] following the receipt by the
Recipient Participant of written notice from the Proposing
Participant pursuant to Clause 21.1.2 above, the Proposing
Participant may contact the Presiding Justice and request that an
independent US-based arbitrator who is knowledgeable of the
pharmaceutical/biotechnology industry be appointed within [***]. The
Presiding Justice shall endeavour to select an arbitrator who is
technically knowledgeable the pharmaceutical industry (and who
directly and through his affiliates, has no business relationship
with, or shareholding in, either the Proposing Participant or the
Recipient Participant). Promptly upon being notified of his
appointment, the Proposing Participant and the Recipient Participant
shall submit to the arbitrator details of their assessment of the
fair market value for the Shares of the Recipient Participant
together with such information as they think necessary to validate
their assessment. The arbitrator shall notify the Recipient
Participant of the fair market value assessed by the Proposing
Participant (the "PROPOSING PARTICIPANT PRICE") and shall notify the
Proposing Participant of the fair market value assessed by
------------
[***] Omitted pursuant to a request for confidential treatment. The omitted
material has been separately filed with the Securities and Exchange
Commission.
45
the Recipient Participant (the "RECIPIENT PARTICIPANT PRICE"). The
Proposing Participant and the Recipient Participant shall then be
entitled to make further submissions to the arbitrator within [***]
explaining why the Recipient Participant Price or the Proposing
Participant Price, as the case may be, is unjustified. The
arbitrator shall thereafter meet with the Proposing Participant and
the Recipient Participant and shall thereafter choose either the
Recipient Participant Price or the Proposing Participant Price (but
not any other price) as the purchase price for the Shares (the
"PURCHASE PRICE") on the basis of which price he determines to be
closer to the fair market value for the Shares of the Recipient
Participant. The arbitrator shall use his best efforts to determine
the Purchase Price within [***] of his appointment. The Proposing
Participant and the Recipient Participant shall bear the costs of
the arbitrator equally provided that the arbitrator may, in his
discretion, allocate all or a portion of such costs to one Party.
Any decision of the arbitrator shall be final and binding.
21.1.4 The Proposing Participant shall have [***] following the
determination of the Purchase Price by the arbitrator to elect,
whether or not, to proceed with its option to purchase the Shares of
the Recipient Participant.
21.1.5 The Shares of the Recipient Participant so transferred shall be sold
by the transferor as beneficial owner with effect from the date of
such transfer free from any lien, charge or encumbrance with all
rights attaching thereto. If the Proposing Participant elects to
purchase the Shares of the Recipient Participant, the Shares of the
Recipient Participant shall be sold by the Recipient Participant as
beneficial owner for a price equal to [***]% of the Purchase Price
with effect from the date specified by the Proposing Participant in
its notice of election free from any lien, charge or encumbrance
together with all rights attaching thereto.
21.2. Upon termination of the Licenses, or cessation of business by the
Company or the dissolution or winding up of the Company or Nascime,
or the Company's or Nascime's inability to pay its debts as they
fall due or the Company or Nascime otherwise becomes insolvent, or a
receiver is appointed over all or a significant part of the assets
of the Company or Nascime, or an examiner is appointed to the
Company or Nascime:
21.2.1. subject to Clause 21.2.4, all rights licensed by Elan to
the Elan Intellectual Property shall terminate;
21.2.2. subject to Clause 21.2.4, all rights licensed by DOV to
the DOV Intellectual Property shall terminate;
21.2.3. subject to Clause 21.2.4 and to such license, if any,
granted by or Nascime to DOV pursuant to the provisions
of Clause 6.5 and/or Clause 10.7, and to such
------------
[***] Omitted pursuant to a request for confidential treatment. The omitted
material has been separately filed with the Securities and Exchange
Commission.
46
license, if any, granted by or Nascime to Elan pursuant
to the provisions of Clause 6.6, all rights to Nascime
Intellectual Property and any other technology, patents
and know-how belonging to or Nascime shall be
transferred to and be jointly owned by Elan and DOV.
Elan shall have the right to exploit and commercialize,
including the right to grant sub-licenses, the Nascime
Intellectual Property which relates predominantly to the
Elan Intellectual Property. DOV shall have the right to
exploit and commercialize, including the right to grant
sub-licenses, the Nascime Intellectual Property which
relates predominantly to the DOV Intellectual Property.
In the event of a dispute arising pursuant to this
Clause 21.2.3, Elan and DOV agree to negotiate in good
faith on the course of action to be taken with respect
to determining their respective entitlements pursuant to
this Clause 21.2.3; and
21.2.4. the rights of permitted third party sublicensees in and
to the Elan Intellectual Property and the DOV
Intellectual Property shall survive the termination of
the license and sublicense agreements granting said
intellectual property rights to Nascime, Nascime and
Elan and DOV shall in good faith agree upon the form
most advantageous to Elan and DOV in which the rights of
Nascime under any such sublicenses are to be held (which
form may include continuation of Nascime solely as the
holder of such licenses or assignment of such rights to
a third party or parties, including an assignment to
both Elan and DOV). Any sublicense agreement between
Nascime and such permitted sublicensee shall permit an
assignment of rights by Nascime to both Elan and DOV and
shall contain appropriate confidentiality provisions.
CLAUSE 22
CONFIDENTIALITY
22.1 The Participants, the Company and Nascime stipulate that it may be
necessary, from time to time, to disclose to each other confidential
and proprietary information, including without limitation,
inventions, works of authorship, trade secrets, specifications,
designs, data, know-how and other information, relating to the
Field, the Products, processes, and services of the disclosing
Party.
22.2 The Participants, the Company and Nascime stipulate that the
information to be disclosed by DOV and Elan to the Company may
include trade secrets, know-how and other proprietary information
and data regarding the Products or the Technologies. The foregoing
shall be referred to collectively as "CONFIDENTIAL INFORMATION". Any
Confidential Information revealed by a Party to another Party shall
be used by the receiving Party exclusively for the purposes of
fulfilling the receiving Party's rights and obligations under this
Agreement, and for no other purpose.
47
22.3 Each Party shall disclose Confidential Information of another Party
only to those employees, representatives and agents requiring
knowledge thereof in connection with fulfilling the Party's
obligations under this Agreement. Each Party further agrees to
inform all such employees, representatives and agents of the terms
and provisions of this Agreement and their duties hereunder and to
obtain their consent hereto as a condition of receiving Confidential
Information. Each Party shall exercise the same degree of care, but
in no event less than a reasonable degree, and protection to
preserve the proprietary and confidential nature of the Confidential
Information disclosed by a Party, as the receiving Party would
exercise to preserve its own proprietary and confidential
information. Each Party shall, upon request of a Party, return all
documents and any copies thereof containing Confidential Information
belonging to or disclosed by, such Party.
22.4 Notwithstanding the above, each Party may use or disclose
Confidential Information disclosed to it by another Party to the
extent such use or disclosure is reasonably necessary to file or
prosecute patent applications, prosecute or defend litigation,
comply with patent applications, prosecute or defend litigation,
comply with applicable governmental regulations or otherwise submit
information to tax or other governmental authorities, conduct
clinical trials, or make a permitted sub-license or otherwise
exercise its rights hereunder; provided, that if a Party is required
to make any such disclosure of the other Party's Confidential
Information, other than pursuant to a written confidentiality
agreement, such Party shall inform the recipient of the terms and
provisions of this Agreement and their duties hereunder and to
obtain their consent hereto as a condition of necessary and
Confidential Information.
22.5 Any breach of this Clause 22 by any Persons informed by one of the
Parties is considered a breach by the Party itself.
22.6. Confidential Information shall be deemed not to include:
22.6.1. information that is in the public domain;
22.6.2. information that is made public through no breach of
this Agreement;
22.6.3. information that is independently developed by a Party;
22.6.4. information that becomes available to a Party on a
non-confidential basis, whether directly or indirectly,
from a source other than another Party, which source, to
the best of the Party's knowledge, did not acquire this
information on a confidential basis; or
22.6.5. information which the receiving Party is required to
disclose pursuant to:
22.6.5.1. a valid order of a court or other
governmental body or any political
48
subdivision thereof or otherwise required by
law; or
22.6.5.2. other requirement of law;
provided, that if the receiving Party becomes legally
required to disclose any confidential information, the
receiving Party shall give the disclosing Party prompt
notice of such fact so that the disclosing Party may
obtain a protective order or other appropriate remedy
concerning any such disclosure. The receiving Party
shall fully cooperate with the disclosing Party in
connection with the disclosing Party's efforts to obtain
any such order or other remedy. If any such order or
other remedy does not fully preclude disclosure, the
receiving Party shall make such disclosure only to the
extent that such disclosure is legally required.
22.7. The provisions relating to confidentiality in this Clause 22 shall
remain in effect during the term of this Agreement and for a period
of [***] following the expiration or earlier termination of this
Agreement.
22.8. The Participants agree that the obligations of this Clause 22 are
necessary and reasonable in order to protect the Participants'
respective businesses, and each Party agrees that monetary damages
would be inadequate to compensate a Party for any breach by the
other Party of its covenants and agreements set forth herein.
Accordingly, the Participants agree that any such violation or
threatened violation shall cause irreparable injury to a Party and
that, in addition to any other remedies that may be available, in
law and equity or otherwise, any Party shall be entitled to obtain
injunctive relief against the threatened breach of the provisions of
this Clause 23, or a continuation of any such breach by the other
Party, specific performance and other equitable relief to redress
such breach together with its damages and reasonable counsel fees
and expenses to enforce its rights hereunder, without the necessity
of proving actual or express damages.
CLAUSE 23
PARTICIPANTS' CONSENT
23.1 Where this Agreement provides that any particular transaction or
matter requires the consent, approval or agreement of any
Participant, such consent, approval or agreement shall be given in
writing and to the extent such consent, approval or agreement is
given upon terms and conditions agreed to in a writing signed by
both Participants, such written terms and conditions shall operate
as an amendment of this Agreement.
CLAUSE 24
------------
[***] Omitted pursuant to a request for confidential treatment. The omitted
material has been separately filed with the Securities and Exchange
Commission.
49
PARTICIPANTS' BOUND
24.1. The Company undertakes with each of the Participants to be bound by
and comply with the terms and conditions of this Agreement insofar
as they relate to the Company.
CLAUSE 25
COSTS
25.1 Each Participant shall bear its own legal and other costs incurred
in relation to preparing and concluding this Agreement and the
related agreements and other documents.
25.2 All other costs, legal fees, registration fees and other expenses
relating to the transactions contemplated hereby, including the
costs and expenses incurred in relation to the incorporation of the
Company, shall be borne by the Company.
CLAUSE 26
GENERAL
26.1 Good Faith
Each of the Parties hereto undertakes with the others to do all
things reasonably within its power that are necessary or desirable
to give effect to the spirit and intent of this Agreement.
26.2 Further Assurance
The Parties shall use reasonable efforts to procure that any
necessary third party shall do, execute and perform all such further
deeds, documents, assurances, acts and things as any of the Parties
hereto may reasonably require by notice in writing to the others to
carry the provisions of this Agreement into full force and effect.
26.3 No Representation
Each of the Parties hereto hereby acknowledges that in entering into
this Agreement it has not relied on any representation or warranty
save as expressly set out herein or in any document referred to
herein.
50
26.4 Force Majeure
No Party to this Agreement shall be liable for delay in the
performance of any of its obligations hereunder if such delay
results from causes beyond its reasonable control, including without
limitation, acts of God, fires, strikes, acts of war, or
intervention of any relevant government authority, but any such
delay or failure shall be remedied by such Party as soon as
practicable.
26.5 Relationship of the Participants
Nothing contained in this Agreement is intended or is to be
construed to constitute Elan and DOV as partners, or Elan as an
employee or agent of DOV, or DOV as an employee or agent of Elan. No
Party hereto shall have any express or implied right or authority to
assume or create any obligations on behalf of or in the name of
another Party or to bind another Party to any contract, agreement or
undertaking with any third party.
26.6 Counterparts
This Agreement may be executed in any number of counterparts, each
of which when so executed shall be deemed to be an original and all
of which when taken together shall constitute this Agreement.
26.7 Notices
Any notice to be given under this Agreement shall be sent in writing
by registered or recorded delivery post or reputable overnight
courier such as Federal Express or telecopied to:
Elan at:
Xxxxxxx Xxxxx, Xxxxxxx Xxxxx, Xxxxxx 0, Xxxxxxx
Attention: Vice President
General Counsel
Elan Pharmaceutical Technologies,
a division of Elan Corporation, plc
Telephone: 000 0 000 0000
Fax: 000 0 000 0000
with a copy to:
Xxxxx Xxxxxxxxxxx XxXxxxxxx LLC
Xxx Xxxxxxxx Xxxxxx, 00xx Xxxxx
00
Xxx Xxxx, XX 00000
Attention: Xxxxx Xxxxxxx, Esq.
Telephone 000 000 0000
Fax: 000 000 0000
Elan International Services, Limited
000 Xx. Xxxxx Xxxxx
Xxxxxx
Xxxxxx, XX00
Bermuda.
Attention : President
Telephone 000 000 0000
Fax: 000 000 0000
with a copy to:
Xxxxx Xxxxxxxxxxx XxXxxxxxx LLC
Xxx Xxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx Xxxxxxx, Esq.
Telephone 000 000 0000
Fax: 000 000 0000
DOV at:
DOV Pharmaceutical, Inc.
Xxx Xxxxxx Xxxxx
Xxxx Xxx, XX 00000
Attn: Chief Executive Officer
Telephone 000 000 0000
Fax: 000 000 0000
with a copy to:
Xxxxxxxx Xxxxxxxxxx LLP
000 Xxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: J. Xxxxxx Xxxxxx, Esq.
Telephone 000 000 0000
Fax. 000 000 0000
52
the Company at:
Xxxxxxxxx Xxxxx,
0 Xxxxxx Xxxxxx,
Xxxxxxxx,
Xxxxxxx,
Xxxxxxxxx: President
Telephone: 000 000 0000
Telefax: 000 000 0000
Nascime at:
00 Xxxxxxx Xxxxxx
Xxxxxx 0
Xxxxxxx
Attention: President
Telephone: 000 0 000 0000
Telefax: 353 1 619 9010
with a required copy to each of the Participants other than the
Particpant, if any, serving the notice or to such other address(es)
as may from time to time be notified by any Party to the others
hereunder.
Any notice sent by mail shall be deemed to have been delivered
within three working days after dispatch or delivery to the relevant
courier and any notice sent by telecopy shall be deemed to have been
delivered within 24 hours of the time of the dispatch. Notices of
change of address shall be effective upon receipt. Notices by
telecopy shall also be sent by another method permitted hereunder.
26.8 Governing Law and Disputes
This Agreement shall be governed by and construed in accordance with
the laws of Ireland and the Parties agree to submit to the exclusive
jurisdiction of the courts of Ireland for the resolution of disputes
hereunder and the Parties hereby waive any and all defences of
improper venue or that the forum is inconvenient.
26.9 Severability
If any provision in this Agreement is agreed by the Parties to be,
deemed to be or becomes invalid, illegal, void or unenforceable
under any law that is applicable hereto, (i) such provision will be
deemed amended to conform to applicable laws so as to be valid and
enforceable or, if it cannot be so amended without materially
altering
53
the intention of the Parties, it will be deleted, with effect from
the date of such agreement or such earlier date as the Parties may
agree, and (ii) the validity, legality and enforceability of the
remaining provisions of this Agreement shall not be impaired or
affected in any way.
26.10 Amendments
No amendment, modification or addition hereto shall be effective or
binding on any Party unless set forth in writing and executed by a
duly authorised representative of all Parties.
26.11 Waiver
No waiver of any right under this Agreement shall be deemed
effective unless contained in a written document signed by the Party
charged with such waiver, and no waiver of any breach or failure to
perform shall be deemed to be a waiver of any future breach or
failure to perform or of any other right arising under this
Agreement.
26.12 Headings
The section headings contained in this Agreement are included for
convenience only and form no part of the agreement between the
Parties. Except as otherwise provided herein, references to
recitals, articles, paragraphs, clauses and appendices are to those
contained in this Agreement.
26.13 Assignment
None of the Parties shall be permitted to assign its rights or
obligations hereunder without the prior written consent of the other
Parties. Elan and/or DOV shall have the right to assign their rights
and obligations hereunder to their Affiliates or other Persons with
whom they have an interest, by contract, ownership of securities or
otherwise, and that are in the nature of financing vehicles or
similar entities for Elan or DOV as the case may be or its
Affiliates, without the prior written consent of the other; provided
further, that such assignment does not result in adverse tax
consequences for any other Party. The Parties will discuss any
assignment by them to an Affiliate or such other Persons prior to
its implementation in order to avoid or reduce any additional tax
liability to any other Party resulting solely from different tax law
provisions applying after such assignment to an Affiliate. [***]
---------------
[***] Omitted pursuant to a request for confidential treatment. The omitted
material has been separately filed with the Securities and Exchange
Commission.
54
26.14 No Effect on Other Agreements
No provision of this Agreement shall be construed so as to negate,
modify or affect in any way the provisions of any other agreement
between any of the Parties unless specifically referred to, and
solely to the extent provided herein. In the event of a conflict
between the provisions of this Agreement and the provisions of the
License Agreements the terms of this Agreement shall prevail unless
this Agreement specifically provide otherwise.
26.15 Successors
This Agreement shall be binding upon and inure to the benefit of the
Parties hereto, their successors and permitted assigns.
55
IN WITNESS whereof, the Parties hereto have executed this Agreement on the day
first set forth above.
SIGNED BY:_______________________
for and on behalf of
ELAN CORPORATION, PLC
in the presence of:__________________
SIGNED BY:__________________________
for and on behalf of
ELAN INTERNATIONAL SERVICES, LTD.
in the presence of:__________________
SIGNED BY:/s/ Xxxxxx Xxxxx
--------------------------
for and on behalf of
DOV PHARMACEUTICAL, INC.
in the presence of:/s/ Xxxxx Xxxxxxxx
-----------------------
SIGNED BY: /s/ Xxxxxx Xxxxx
-------------------------
for and on behalf of
DOV NEWCO, LTD.
in the presence of: /s/ Xxxxx Xxxxxxxx
---------------------
SIGNED BY: /s/ Xxxxxx Xxxxx
-------------------------
for and on behalf of
NASCIME LIMITED
in the presence of: /s/ Xxxxx Xxxxxxxx
---------------------
56
IN WITNESS whereof, the Parties hereto have executed this Agreement on the day
first set forth above.
SIGNED BY: /s/ Xxxxx Xxxxxx
-------------------------
for and on behalf of
ELAN CORPORATION, PLC
in the presence of:[Signature Illegible]
---------------------
SIGNED BY: /s/ Xxxxx Xxxxxx
-------------------------
for and on behalf of
ELAN INTERNATIONAL SERVICES, LTD.
in the presence of:[Signature Illegible]
----------------------
SIGNED BY:/s/ Xxxxxx Xxxxx
--------------------------
for and on behalf of
DOV PHARMACEUTICAL, INC.
in the presence of:
----------------------
SIGNED BY:
-------------------------
for and on behalf of
DOV NEWCO, LTD.
in the presence of:
---------------------
SIGNED BY:
-------------------------
for and on behalf of
NASCIME LIMITED
in the presence of:
---------------------
57
SCHEDULE A
SUBSCRIPTIONS
DOV 16,020 "A" Shares at US$1 per "A" Share
EIS 3,980 "B" Non-Voting Shares at US$1 per "B" Share
58
SCHEDULE B
ELAN LICENSE AGREEMENT
59
SCHEDULE C
DOV LICENSE AGREEMENT
60
