Exhibit T
AGREEMENT TO ISSUE SHARES
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THIS AGREEMENT is made as of the 1st day of December, 2004.
BETWEEN: NEUROCHEM INC., a Canadian corporation (herein referred to
as "NEUROCHEM" or the "CORPORATION");
AND: XX. XXXXXXXXX XXXXXXX, executive, of the City of Montreal,
Province of Quebec (herein referred to as the "EXECUTIVE").
WHEREAS the Executive is a director and officer of the Corporation and in those
capacities is devoting considerable time and effort to the affairs of the
Corporation; and
WHEREAS the Corporation wishes to recognize the considerable time and effort the
Executive is so devoting to its affairs;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1. DEFINITIONS.
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For the purposes of this Agreement, the following terms shall have the
respective meanings set out below, and grammatical variations of such terms
shall have corresponding meanings:
"ALZHEMED TRANSACTION" has the meaning set out in Section 6(a);
"APPLICABLE LAWS" means all applicable provisions of law, domestic or foreign,
including, without limitation, the Securities Act (Quebec) as amended, together
with all regulations, rules, policy statements, rulings, notices, orders or
other instruments promulgated thereunder and the rules of the TSX or any other
stock exchange or market upon which the Common Shares are listed or posted for
trading;
"BOARD" means the Board of Directors of the Corporation;
"BUSINESS DAY" means any day, other than a Saturday, Sunday or statutory holiday
in Montreal, Quebec;
"COMMITTEE" means the Compensation Committee of the Board or such other
committee of the Board as may from time to time be responsible for matters
relating to executive compensation;
"COMMON SHARES" means the common shares of the Corporation as constituted at the
date hereof or any other shares or other securities into which such shares may
have been changed, reclassified, subdivided, consolidated or converted;
"CONFIRMATION LETTER" has the meaning set out in Section 7(b);
"EUROPEAN MARKET" means any two of France, Germany, the United Kingdom, Italy or
Spain;
"FIBRILLEX TRANSACTION" has the meaning set out in Section 6(b);
"FINANCING" has the meaning set out in Section 6(c);
"MARKET PRICE" means, in respect of any date, the weighted-average of closing
prices per Common Share as reported on the TSX for the 20 days on which Common
Shares were traded on the TSX immediately preceding such date. If the Common
Shares are not listed and posted for trading on the TSX on the date of
determination, the Market Price shall be the value determined by the Committee
based on the weighted-average of the closing prices per Common Share on any
other stock exchange on which the Common Shares are listed. If the Common Shares
are not then listed on any stock exchange, the Market Price shall be determined
by the Committee in good faith;
"PERFORMANCE TARGET" means each of the Alzhemed Transaction, the Fibrillex
Transaction, the Financing and the Succession Plan;
"RELEVANT MARKET" means any one of the United States, Japan or the European
Market;
"REORGANIZATION" means any (i) capital reorganization; (ii) merger; (iii)
amalgamation; (iv) offer for Common Shares of the Corporation which, if
successful, would entitle the offeror to acquire all of the Common Shares; (v)
sale of all or substantially all of the assets of the Corporation; or (vi) an
arrangement or other scheme of reorganization;
"SUBJECT SHARES" has the meaning set out in Section 5;
"SUCCESSION PLAN" has the meaning set out in Section 6(d); and
"TSX" means the Toronto Stock Exchange.
2. CONSTRUCTION.
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In this Agreement, unless otherwise expressly stated or the context
otherwise requires:
(a) references to "herein", "hereby", "hereunder", "hereof" and similar
expressions are references to this Agreement and not to any particular Section
of this Agreement;
(b) references to a "Section" and "Schedule" are references to a Section
or Schedule of this Agreement;
(c) words importing the singular shall include the plural and vice versa,
words importing gender shall include the masculine, feminine and neuter genders;
and
(d) the use of headings is for convenience of reference only and shall not
affect the construction or interpretation hereof.
3. SEVERABILITY.
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If any provision of this Agreement is determined by a court of competent
jurisdiction to be invalid, illegal or unenforceable in any respect, such
determination shall not impair or affect the validity, legality or
enforceability of the remaining provisions hereof, and each provision is hereby
declared to be separate, severable and distinct.
4. GOVERNING LAW.
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This Agreement is established under the laws of the Province of Quebec and
the rights of all parties and the construction of each and every provision of
this Agreement shall be construed according to the laws of the Province of
Quebec.
5. GRANT AND VESTING OF SUBJECT SHARES.
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The Corporation hereby agrees to issue (or deliver, as provided in Section
7.) Common Shares to the Executive on and subject to the terms set out herein.
Subject to Section 7, the Executive shall be entitled to receive, without
further consideration, Common Shares (the "SUBJECT SHARES") in the number set
out in Schedule A upon the execution of this Agreement or upon achievement of
the relevant Performance Target, as the case may be.
6. PERFORMANCE TARGETS.
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The Performance Targets shall be the following:
(a) the date of closing of a collaboration agreement with a major
pharmaceutical company for the development and commercialization of the compound
currently known as Alzhemed (NC-758) and/or its back-up and/or next generation
molecules covering at least one of the Relevant Markets (the "ALZHEMED
TRANSACTION");
(b) the date of closing of a collaboration agreement with a major
pharmaceutical company for the development and commercialization of the compound
currently known as Fibrillex (NC-503) and/or its back-up and/or next generation
molecules covering at least one of the Relevant Markets (the "FIBRILLEX
TRANSACTION");
(c) the completion of a substantial third party or external equity and/or
debt (including convertible debt) financing for the Corporation, whether public
or private, not including, however, any equity or other securities issued by the
Corporation in connection with the Fibrillex Transaction or the Alzhemed
Transaction (the "FINANCING"); and
(d) the restructuring of the Corporation's management structure and, with
the participation of the Committee and with the approval of the Board,
formalizing of a
succession plan for the Corporation including the hiring of a potential
successor to the chief executive officer of the Corporation (the "SUCCESSION
PLAN").
7. DELIVERY OF SUBJECT SHARES.
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(a) The Subject Shares shall be issued from treasury. Notwithstanding the
foregoing, the Subject Shares or any of them may, with the consent of the
Executive, also be purchased by the Corporation in the open market.
(b) Notwithstanding anything to the contrary in this Agreement, no Subject
Shares shall be required to be issued (and/or delivered, as the case may be) by
the Corporation hereunder unless and until (i) the necessary shareholder and
regulatory approvals have been obtained under Applicable Laws; and (ii) the
Corporation has received written confirmation from the Executive that a
particular Performance Target has been achieved (a "CONFIRMATION LETTER"), as
the case may be. The Corporation agrees to use its commercially reasonable
efforts to obtain all necessary shareholder and regulatory approvals under
Applicable Laws in connection with the issuance from treasury (and/or delivery,
as the case may be) of the Subject Shares to the Executive. The Corporation
shall comply with all Applicable Laws in connection with the issuance (and/or
delivery, as the case may be) of the Subject Shares to the Executive.
(c) The Corporation shall, subject to Section 7(b), issue and/or deliver
to the Executive the Subject Shares as soon as reasonably practicable after
receiving all necessary shareholder and regulatory approvals under Applicable
Laws and the Confirmation Letter, as the case may be.
(d) The Subject Shares issued hereunder shall be considered fully paid in
consideration for past services rendered that are not less valuable than the
fair equivalent the Corporation would have received if the shares had been
issued for money.
8. ADJUSTMENTS.
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If the number of outstanding Common Shares shall be increased or decreased
or otherwise changed as a result of a Common Share split or consolidation,
subdivision, reclassification or recapitalization and not as a result of the
issuance of Common Shares for additional consideration or by way of a Common
Share distribution in the ordinary course, the Committee may make such
adjustments to the number of Subject Shares to be issued and/or delivered, as
the case may be, to the Executive in such manner as the Committee and the
Executive agree to be equitable or appropriate.
9. REORGANIZATIONS.
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In the event of a Reorganization or proposed Reorganization, the Committee
may make such adjustments or substitutions to the rights granted hereunder as
the Committee and the Executive agree to be equitable or appropriate, including
(without limitation) adjustments to the aggregate number, class and kind of
securities or other consideration that may be issued and/or delivered, as the
case may be, under this Agreement, which
adjustments or substitutions may be conditional upon the completion of the
Reorganization.
10. NO ADJUSTMENT FOR DECREASE IN VALUE.
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For greater certainty, no additional amount will be paid to the Executive
under this Agreement, and no additional Common Shares will be issued (and/or
delivered, as the case may be) to the Executive to compensate for a downward
fluctuation in the Market Price of the Common Shares, nor will any other form of
additional benefit be conferred upon, or in respect of, the Executive for such
purpose.
11. TERMINATION OF EMPLOYMENT AND FORFEITURE.
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If the Executive ceases to be an officer and director of the Corporation
and no longer provides management services to the Corporation directly or
through a formal agreement such as the management services agreement currently
in place between Picchio International Inc. and the Corporation for any reason
other than termination without cause or death or incapacity, all rights granted
hereunder shall be immediately forfeited as of the first date on which the
Executive is no longer an officer, director or management service provider and
the Executive shall not be entitled to receive any Subject Shares pursuant to
this Agreement. In the event of the death or incapacity of the Executive or
termination of such management services without cause, the Executive or his
heirs or other legal representatives, as the case may be, shall be entitled to
receive, within 90 days of the death, determination of incapacity or
termination, the Subject Shares which are issuable or deliverable, as the case
may be, by the Corporation upon the execution of this Agreement and in respect
of which the relevant Performance Target has been achieved, if any.
12. NON-TRANSFERABILITY.
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All rights hereunder, and the payment obligations relating thereto, are for
the benefit of the Executive or, in the event of his death, his heirs or other
legal representatives, as hereinafter provided. The Executive shall not be
entitled to transfer, assign, charge, pledge or hypothecate, or otherwise
alienate, whether by operation of law or otherwise, any such rights and they
shall not be subject to execution, attachment or similar process.
13. MISCELLANEOUS.
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(a) Nothing contained herein shall be construed as conferring upon the
Executive any right with respect to continuance of employment or continuance as
an officer of the Corporation or interfere in any way with the right of the
Corporation to terminate the employment or office of the Executive at any time
in accordance with applicable law.
(b) The Executive shall not have, by virtue of this Agreement, any right,
title or interest whatsoever in or to the assets of the Corporation. The rights
granted hereunder are not Common Shares and will not entitle the Executive to
any rights as a shareholder, including (without limitation) voting rights,
entitlements to distributions or rights on
liquidation. Nothing contained in this Agreement, and no action taken pursuant
to its provisions, shall create or be construed to create a trust of any kind,
or a fiduciary relationship between the Corporation and the Executive.
Notwithstanding the foregoing, the Executive or his or her legal personal
representative shall be entitled to enforce his or her right to receive payment
of amounts due and owing to him under this Agreement.
(c) Any decision, interpretation or determination in respect of the
administration of this Agreement including the determination of whether a
Performance Target has been met and the release of the Executive from his
obligation to deliver to the Corporation a Confirmation Letter in respect of any
Performance Target, shall be in the exclusive purview of the Board in its sole
and absolute discretion and all decisions shall be final and binding on all
parties concerned.
(d) The parties hereto agree to make all necessary public disclosure as
may be required by Applicable Laws in respect of the subject matter hereof,
including without limitation, following the issuance or delivery, as the case
may be, of Subject Shares to the Executive.
(e) The parties hereto confirm that they have expressly agreed that this
Agreement and all other documents relating thereto shall be drawn in the English
language. Les parties aux presentes confirment qu'elles ont convenu expressement
que cette convention et tous autres documents s'y rapportant soient rediges en
anglais.
IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the
date first above written.
NEUROCHEM INC.
Per: (signed) Xxxxx Xxxx
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Xx. Xxxxx Xxxx
Director
Per: (signed) Xxxxxx Xxxxxxxx
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Xxxxxx Xxxxxxxx
Director
(signed) Xxxxxxxxx Xxxxxxx
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XX. XXXXXXXXX XXXXXXX
