EXHIBIT 10.4
TERMINATION AND RELEASE AGREEMENT
THIS TERMINATION AND RELEASE AGREEMENT (the "Agreement) is dated as of
March 7th, 2002 (the "Effective Date"), by and between Schein Pharmaceutical
(Bermuda), LTD. ("Schein'), and Endorex Newco, LTD. ("Endorex"),
RECITALS
WHEREAS, on February 2, 2000, Schein and Endorex entered into a
Development, Licence and Supply Agreement (the "Development Agreement"); and,
WHEREAS, Schein and Endorex now mutually desire to terminate the
Development Agreement and each of their respective rights, duties, obligation
and remedies under the Development Agreement, all upon the terms and conditions
as set forth below.
NOW, THEREFORE, the parties to this Agreement hereby agree as follows:
1. TERMINATION OF DEVELOPMENT AGREEMENT.
(a) Effective as of the Effective Date, Schein and Endorex hereby agree
that the Development Agreement and all licences contained therein are hereby
terminated and of no further force or effect whatsoever and, except as otherwise
set forth herein, neither Schein nor Endorex shall have any further obligations
with respect thereto. In consideration for the parties entering into this
Agreement effectively terminating the Development Agreement, and the general
releases contained herein, within three (3) business days from the Effective
Date, Schein shall pay to Endorex the amount of three-hundred thousand dollars
($300,000.00) in cash by wire transfer of immediately available funds to an
account designated by Endorex as set forth on Exhibit A, attached hereto and
incorporated herein by this reference.
(b) Without limiting subparagraph (a) above, each of Schein and Endorex
expressly acknowledge and agree that neither party nor any of their respective
Affiliates (as defined below) shall have any ongoing obligations, liabilities or
responsibilities of any nature whatsoever pursuant to the non-competition
covenant contained in Clause 4 of the Development Agreement and that, except as
otherwise provide herein, the provisions of Clause 14 -CONSEQUENCES OF
TERMINATION shall not survive the termination of the Development Agreement and
shall be of no further force or effect. For purposes hereof, "Affiliate" shall
mean, when used with respect to a person, any other person directly or
indirectly controlling, controlled by, or under common control with the subject
person. For purposes of this Agreement, "control" means the direct or indirect
ownership of over 50% of the outstanding voting securities of a person, or the
right to receive over 50% of the profits or earnings of a person.
(c) Notwithstanding the above, the confidentiality provisions set forth in
Subsection 17.1 of the Development Agreement shall remain in full force and
effect for a period of seven years from the Effective Date and, further, the
indemnity obligations contained in Subsections
15.7.1 and 15.7.2 of the Development Agreement shall survive the termination of
the Development Agreement effected hereby.
2. MUTUAL RELEASE.
(a) RELEASE BY ENDOREX. Except as expressly set forth in Paragraph 1 above,
Endorex hereby releases and forever discharges Schein and its Affiliates, and
its and their respective directors, officers, employees, agents, successors arid
assigns, from and against any and all liabilities, obligations, expenses,
losses, damages, indemnities, claims, causes of action and demands whatsoever
which Endorex ever had, now has or may have, whether now known or unknown,
against Schein and/or any of its Affiliates arising out of, resulting from, or
in any way related to the Development Agreement.
(b) RELEASE BY SCHEIN. Except as expressly set forth in Paragraph 1 above,
Schein hereby releases and forever discharges Endorex and its Affiliates, and
its and their respective directors, officers, employees, agents, successors and
assigns, from and against any and all liabilities, obligations, expenses,
losses, damages, indemnities, claims, causes of action and demands whatsoever
which Schein ever had, now has or may have, whether now known or unknown,
against Endorex and/or any of its Affiliates arising out of, resulting from, or
in any way related to the Development Agreement.
(c) The parties understand and expressly agree that the mutual releases set
forth herein extend to all claims arising on or prior to the Effective Date
related to the Development Agreement of every nature and kind whatsoever,
whether known or unknown, as provided by California Civil Code Section 1542 and
any other law in any other state or jurisdiction to the same or similar effect,
arid the parties do hereby waive and relinquish any and all rights, benefits, or
protections they may have under such laws. Section 1542 of the Civil Code of the
State of California provides as follows:
"A general release does not extend to claims which the creditor does not
know or suspect to exist in his favor at the time of executing the release,
which if known by him must have materially affected his settlement with the
debtor."
3. MISCELLANEOUS.
(a) ASSIGNMENT, BINDING EFFECT. Neither this Agreement nor any of the
rights, interests or obligations hereunder shall be assigned by one party
(whether by operation of law or otherwise) without the prior written consent of
the other party. Provided, however, that either party may assign this Agreement
without the other party's consent in connection with a merger, acquisition or
other sale or transfer of such party's business or the portion of the business
to which this Agreement relates, Subject to the preceding sentence, this
Agreement shall be binding upon and shall inure to the benefit of the parties
hereto and their respective permitted successors and assigns.
(b) GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York without regard to its rules of
conflict of laws.
(c) COUNTERPARTS. This Agreement may be executed by the parties hereto in
separate counterparts, each of which when so executed and delivered shall be an
original, but all such counterparts shall together constitute one and the same
instrument.
(d) SEVERABILITY. Any term or provision of this Agreement which is invalid
or unenforceable in any jurisdiction shall, as to that jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering Invalid or unenforceable the remaining terms and provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction. If any provision of this
Agreement is so broad as to be unenforceable, the provision shall be interpreted
to be only so broad as is enforceable.
(e) ENTIRE AGREEMENT. This Agreement constitutes the entire agreement of
the parties concerning its subject matter and supercedes any and all agreements,
written or oral, between the parties hereto concerning the subject matter of
this Agreement. This Agreement may be amended or modified, or any provision
hereof waived, only by a written instrument executed by the parties hereto.
IN WITNESS WHEREOF, the parties have executed this Agreement and caused the
same to be duly delivered on their behalf on the day and year first written
above,
SCHEIN PHARMACEUTICAL
(BERMUDA) LTD. ENDOREX NEWCO, LTD.
By: By:
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Title: Title:
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