LOCKUP AGREEMENT
This Lockup Agreement having an effective date of December 31, 1996,
("Agreement"), is entered into by and between the Xx. Xxxxxxx Xxxxx, Xx. Xxxxxx
Xxxx, Xx. Xxxxxx Xxxxxxx, Xx. Xxxxxx Xxxxxxxxxxx, Mr. Xxxxx Xxxxxxx, Xx. Xxxxxx
Xxxxxx, Xx. Xxxxxxx Xxxxxxxx, and Xx. Xxxxxx Xxxxxxxx (the members of the Board
of Directors of SunPharm Corporation and collectively referred to hereafter as
"Directors"), the University of Florida Research Foundation, Inc.
("Foundation"), and SunPharm Corporation ("SunPharm"), a Delaware corporation
whose principal office address is 0000 Xxxxxxxxx Xxxx, Xxxxx 000, Xxxxxxxxxxxx,
Xxxxxxx 00000.
WITNESSETH
WHEREAS, SunPharm is a company engaged in the research and development
of certain chemical compounds; and
WHEREAS, Directors and Foundation are owners of common stock of
SunPharm; and
WHEREAS, Directors and Foundation believe that the success of SunPharm
requires the active interest and support of its major Shareholders and therefore
desire to promote the best interests of SunPharm and their mutual interests by
agreeing to limit their ability to transfer by sale or otherwise the shares of
Common Stock of SunPharm owned by Shareholder as defined below:
NOW THEREFORE, for and in consideration of the above stated premises
and the mutual covenants hereinafter set forth, and for other good and valuable
consideration, the parties hereby agree as set forth below.
SECTION 1. DEFINITIONS. As used in this Agreement:
"CHANGE OF CONTROL" means the happening of any of the following:
(A) When any "person" as defined in Section 3(a)(9) of the Exchange Act
and as used in Sections 13(d) and 14(d) thereof, including a "group" as defined
in Section 13(d) of the Exchange Act, but excluding (I) SunPharm and any
subsidiary thereof, (ii) Xxxxxx Xxxx (SunPharm's president and chief executive
officer on the Effective Date), and (iii) any employee benefit plan sponsored or
maintained by SunPharm or its subsidiary (including any trustee of such plan
acting as trustee), directly or indirectly, becomes the "beneficial owner" (as
defined in Rule 13d-3 under the Exchange Act, as amended from time to time), of
securities of SunPharm representing twenty-five percent (25%) or more of the
combined voting power of SunPharm's then outstanding securities; or
(B) When, during any period of 12 consecutive months after the
Effective Date, the individuals who, at the beginning of such period, constitute
the Board (the "Incumbent Directors") cease for any reason other than death to
constitute at least a majority thereof; provided however that a director who was
not a director at the beginning of such 12-month period shall be deemed to have
satisfied such 12-month requirement (and be an Incumbent Director) if such
director was elected by, or on the recommendation of or with the approval of, at
least two-thirds of the directors who then qualified as Incumbent Directors
either actually (because they were directors at the beginning of such 12-month
period) or by prior operation of this paragraph; or
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(C) The occurrence of a transaction requiring stockholder approval for
the acquisition of SunPharm by an entity other than SunPharm or its subsidiary
through purchase of assets, or by merger, or otherwise.
"COMMISSION"shall mean the Securities and Exchange Commission or any
other federal agency at the time administering the Securities Act.
"COMMON STOCK" means the Common Stock, par value $.0001, of SunPharm.
"EFFECTIVE DATE" means December 31, 1996.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended, or any similar federal statute and the rules and regulations of the
Commission thereunder, all as the same shall be in effect at the time.
"LOCKUP SHARES"shall mean all shares of Common Stock to which all
right, title and interest owned by any Shareholder as of the Effective Date of
this Agreement and all securities of SunPharm convertible into or exchangeable
for and any rights to purchase or acquire Common Stock of SunPharm including all
such stock of SunPharm now owned by any Shareholder and his spouse as community
property or as separate property. All references herein to the stock owned by a
Shareholder include the community interest of such Shareholder's spouse in such
stock and all obligations of a Shareholder under this Agreement include like
obligations on the part of his spouse. The termination of the marital
relationship of any Shareholder and his spouse for any reason shall not have the
effect of removing any stock of SunPharm otherwise subject to this agreement
from the coverage hereof.
"PERMITTED TRANSFERS" means any Sale of the Lockup Shares as permitted
in Sections 4,5,6 and 10 of this Agreement or any transfer or assignment of the
Lockup Shares in accordance with the Foundations's contractual commitments under
the published patent policies of the University of Florida.
"PERSON"shall include an individual, a corporation, a partnership, a
trust, or any other organization or entity.
"REGISTRABLE SECURITIES" means any and all Lockup Shares held by any
Shareholder during the Term of Agreement issued by SunPharm prior to the
Effective Date herein, or other securities issued or issuable in respect of the
above upon any stock split, stock dividend, recapitalization or similar events.
"SECURITIES ACT" shall mean the Securities Act of 1933 as amended, or
any similar federal statute and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.
"REGISTER", "REGISTERED", AND "REGISTRATION" shall mean a registration
effected by preparing and filing a registration statement in compliance with the
Securities Act, and the declaration or ordering of the effectiveness of such
registration statement.
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"REGISTRATION EXPENSES" shall mean all expenses, other than Selling
Expenses, incurred by SunPharm in complying with Section 6 hereof, including,
without limitation, all registration, qualification and filing fees, exchange
listing fees, printing expenses, escrow fees, fees and disbursements of counsel
for SunPharm, blue sky fees and expenses, the expenses of any special audits
incident to or required by such registration (but excluding the compensation of
regular employees of SunPharm which shall be paid in any event by SunPharm) and
the reasonable fees and disbursements of one counsel for all Shareholders.
"SALE", "SELL", OR "SOLD"shall mean and include, either directly or
indirectly, any sale, contract to sell or other disposition of Lockup Shares of
SunPharm, including but not limited to a disposition by gift, pledge, or other
form of inter vivos transfer, voluntary or involuntary, or distribution of
common stock subsequent to the date of this Agreement; provided however, that
such definition shall not include the exercise by any Shareholder of options or
warrants to purchase
Common Stock in the definition of Lockup Shares.
"SELLING EXPENSES" shall mean all underwriting discounts, selling
commissions and stock transfer taxes applicable to the securities registered by
the Shareholders and, except as set forth above, all fees and disbursements of
counsel for any Shareholder.
"SHAREHOLDER(S)"shall mean the Directors and the Foundation and their
respective heirs, legal representatives, administrators, and successors.
"TERM OF AGREEMENT"shall mean the period from the Effective Date
through December 31, 1999.
SECTION 2. LIMITATION ON SALE OF LOCKUP SHARES. Shareholders agree that
no Lockup Shares or any interest therein shall be sold by any Shareholder except
for Permitted Transfers and as otherwise provided in this Agreement during the
Term of Agreement. Any sale or attempted sale not made in compliance with this
Agreement shall be void and of no effect.
SECTION 3. ONE YEAR AGREEMENT OF SHAREHOLDERS NOT TO SELL LOCKUP
SHARES. Except for Permitted Transfers, Shareholders agree not to sell any
Lockup Shares from the Effective Date of this Agreement through December 31,
1997.
SECTION 4. ONE YEAR AGREEMENT OF SHAREHOLDERS TO LIMIT SALE OF LOCKUP
SHARES. The Shareholders agree to further limit their rights to sell the Lockup
Shares from January 1, 1998 through and including December 31, 1998 as follows:
each Shareholder shall have the right to sell on and after the first day of
January, 1998 and on and after the first day of each month thereafter in
calendar year 1998, Two Percent (2.0%) of the total of the Lockup Shares
(rounded to the nearest share number) held by said Shareholder as of the
Effective Date of this Agreement. Shareholder may at his\its option sell the
monthly amount of such shares on the first of each month, or may accumulate such
monthly amounts of shares to be sold in whole or in part at any time thereafter
by Shareholder. Any right of Shareholder to sell Lockup Shares as provided in
this Agreement is subject to restrictions on sale of such shares as provided by
the Exchange Act.
SECTION 5. ONE YEAR AGREEMENT OF XXXXXX XXXX AND FOUNDATION TO LIMIT
SALE OF
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LOCKUP SHARES. Xxxxxx Xxxx and Foundation agree to further limit their rights to
sell the Lockup Shares from January 1, 1999 through and including December 31,
1999. Xxxxxx Xxxx and Foundation each shall have the right to sell on and after
January 1, 1999 and on and after the first of each month thereafter in calendar
year 1999, Four Percent (4%) of the total of the Lockup Shares (rounded to the
nearest share number) held by Xxxxxx Xxxx or Foundation respectively as of the
Effective Date of this Agreement. Shareholder may at his\its option sell the
monthly amount of such shares on the first of each month, or may accumulate such
monthly amounts of shares to be sold in whole or in part at any time thereafter
by Xxxxxx Xxxx or Foundation. Any right of Xxxxxx Xxxx or Foundation to sell
said Lockup Shares as provided in this Agreement is subject to restrictions on
sale of such shares as provided by the Exchange Act. No other Shareholder is
subject to the provisions of this Section 5.
SECTION 6. SALE OF LOCKUP SHARES BY REGISTRATION.
(A) NOTICE OF REGISTRATION. If SunPharm shall determine during the Term
of Agreement to register any of its securities (other than a registration
relating solely to employee benefit plans, or a registration relating solely to
a Commission Rule 145 transaction), SunPharm will I) promptly give to each
Shareholder written notice thereof; and ii) use its best lawful efforts to
include in such registration (and any related qualification under blue sky laws
or other compliance), and in any underwriting involved therein all of the
Registrable Securities specified in a written request by Shareholder(s) made
within twenty (20) days after receipt of such written notice from SunPharm, by
such Shareholders.
(B) UNDERWRITING The right of any Shareholder to registration hereunder
shall be conditioned upon such Shareholder's participation (on the same terms
and conditions as are applicable to each other selling Shareholder) in such
underwriting, and the inclusion of Registrable Securities in the underwriting
shall be limited to the extent provided herein. SunPharm and all Shareholders
proposing to distribute their securities through such underwriting shall enter
into an underwriting agreement in customary form with the managing underwriter
selected for such underwriting by SunPharm.
Notwithstanding anything herein to the contrary, if the managing
underwriter determines that marketing factors require a limitation of the number
of shares to be underwritten, then SunPharm shall so advise all Shareholders and
the number of shares that may be included in the registration and underwriting
shall be allocated among all Shareholders in proportion as nearly as
practicable, to the respective amounts of Registrable Securities held by each
Shareholder at the time of filing the registration statement. To facilitate the
allocation of shares in accordance with the above provisions, SunPharm may round
the number of shares allocable to any Shareholder to the nearest one hundred
(100) shares.
If any Shareholder disapproves of the terms of any such underwriting,
he\it may elect to withdraw therefrom by written notice to SunPharm and the
managing underwriter, delivered not less than seven days before the effective
date of the registration statement. Any securities voluntarily withdrawn from
such underwriting by a Shareholder shall be withdrawn from such registration,
and continue to be subject to this Agreement such that such securities shall be
withdrawn from the market for the term provided herein but not less than a
period of one hundred twenty (120) days after the effective date of the
registration statement relating thereto, or such other shorter period of time as
the underwriters may require.
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(C) RIGHT TO TERMINATE REGISTRATION. SunPharm shall have the right to
terminate or withdraw any registration initiated by it prior to the
effectiveness of such registration whether or not any Shareholder has elected to
include securities in such registration.
(D) EXPENSES OF REGISTRATION. All Registration Expenses shall be borne
by SunPharm. Unless otherwise stated, all Selling Expenses relating to
securities registered on behalf of the Shareholders shall be borne by the
Shareholders pro rata on the basis of the number of shares so registered.
SECTION 7. REGISTRATION PROCEDURES. In the case of each registration
effected by SunPharm pursuant to this Agreement, SunPharm will keep each
Shareholder advised in writing as to the initiation of each registration and as
to the completion thereof. At its expense, SunPharm will:
(A) Prepare and file with the Commission a registration statement with
respect to such securities and use its best lawful efforts to cause such
registration statement to become and remain effective for at least one hundred
twenty (120) days or until the distribution described in the registration
statement has been completed.
(B) Furnish each underwriter such number of copies of a prospectus,
including a preliminary prospectus, in conformity with the requirements of the
Securities Act, and such other documents as such underwriter may reasonably
request in order to facilitate the public sale of the shares by such
underwriter, and promptly furnish to each underwriter and Shareholder notice of
any stop-order or similar notice issued by the Commission or any state agency
charged with the regulation of securities, and notice of any NASDAQ listing; and
(C) Use its best efforts to cause all Registrable Securities to be
listed on each securities exchange on which similar securities issued by
SunPharm are listed; and if not so listed, use its best efforts to be listed on
the NASDAQ system.
SECTION 8. INDEMNIFICATION.
(A) To the extent permitted by law, SunPharm will indemnify each
Shareholder participating in a registration pursuant to this Agreement, each of
its officers, directors, partners, employees and agents and each person
controlling such Shareholder within the meaning of Section 15 of the Securities
Act , and each underwriter, if any, and each person who controls any underwriter
within the meaning of Section 15 of the Securities Act, against all expenses,
claims, losses, damages or liabilities, (or actions in respect thereof),
including any of the foregoing incurred in settlement of any litigation,
commenced or threatened, to the extent such expenses, claims, losses, damages or
liabilities arise out of or are based on any untrue statement (or alleged untrue
statement) of a material fact contained in any registration statement,
prospectus, offering circular or other document, or any amendment or supplement
thereto, incident to any such registration or securities law compliance, or
based on any omission (or alleged omission) to state therein a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances in which they were made, not misleading, or any
violation by SunPharm of the Securities Act or any rule or regulation
promulgated under the Securities Act applicable to SunPharm in connection with
any such registration, qualification or compliance, and SunPharm
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will reimburse each such Shareholder, each of its officers, directors,
employees, agents and each person controlling such Shareholder, each such
underwriter and each person who controls any such underwriter, for any legal and
any other expenses reasonably incurred in connection with investigation,
preparing or defending any such claim, loss, damage, liability, or action,
PROVIDED HOWEVER, that the indemnity contained herein shall not apply to amounts
paid in settlement of any claim, loss, damage, liability or expense if
settlement is effected without the consent of SunPharm (which consent shall not
unreasonably be withheld), provided that SunPharm will not be liable in any such
case to the extent that any such claim, loss, damage, liability or expense
arises out of or is based on any untrue statement or omission or alleged untrue
statement or omission, made in reliance upon and in conformity with written
information furnished to SunPharm by such Shareholder, controlling person or
underwriter specifically for use therein. Notwithstanding the foregoing, insofar
as the foregoing indemnity relates to any such untrue statement (or alleged
untrue statement) or omission (or alleged omission) made in a preliminary
prospectus but eliminated or remedied in an amended prospectus on file with the
Commission at the time the registration statement becomes effective or in the
final prospectus filed with the Commission pursuant to Rule 424(b) of the
Commission, the indemnity agreement herein shall not inure to the benefit of any
underwriter if a copy of the final prospectus filed pursuant to Rule 424(b) was
not furnished to the person or entity asserting the loss, liability, claim or
damage at or prior to the time such furnishing is required by the Securities
Act.
(B) To the extent permitted by law, each Shareholder will, if
Registrable Securities are included in the securities as to which such
registration, qualification or compliance is being effected, indemnify SunPharm,
each of its directors and officers, each underwriter, if any, of SunPharm's
securities covered by such a registration statement, each person who controls
SunPharm or such underwriter within the meaning of Section 15 of the Securities
Act, and each other such Shareholder, each of its officers and directors and
each person controlling such Shareholder within the meaning of Section 15 of the
Securities Act, against all claims, losses damages and liabilities (or actions
in respect thereof) arising out of or based on any untrue statement by such
Shareholder (or alleged untrue statement) of a material fact contained in any
such registration statement, prospectus, offering circular or other document, or
any omission by such other Shareholder (or alleged omission) to state therein a
material fact required to be stated therein or necessary to make the statement
therein not misleading, or any violation by such Shareholder of any rule or
regulation promulgated under the Securities Act applicable to such Shareholder
and relating to action or inaction required of such Shareholder in connection
with any such registration, qualification or compliance, and will reimburse
SunPharm, such other Shareholders, such directors, officers, persons,
underwriters or control persons for any legal or other expenses reasonably
incurred in connection with investigating or defending any such claim, loss,
damage, liability or action, in each case to the extent, but only to the extent
that such untrue statement (or alleged untrue statement) or omission (or alleged
omission) is made in such registration statement, prospectus, offering circular
or other document in reliance upon and in conformity with written information
furnished to SunPharm by such Shareholder specifically for use therein; PROVIDED
HOWEVER, that the indemnity contained herein shall not apply to amounts paid in
settlement of any claim, loss, damage, liability or expense if effected without
the consent of the Shareholder (which consent shall not be unreasonably
withheld). Notwithstanding the foregoing, the liability of each Shareholder
under this subsection (B) shall be limited in an amount equal to the net
proceeds from the sale of the shares sold by such Shareholder, unless such
liability arises out of or is based on willful conduct by such Shareholder. In
addition, insofar as the foregoing indemnity related to any such untrue
statement (or alleged untrue statement) or omission (or alleged omission)
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made in a preliminary prospectus but eliminated or remedied in an amended
prospectus on file with the Commission at the time the registration statement
becomes effective or in the final prospectus filed pursuant to Rule 424(b) of
the Commission, the indemnity agreement herein shall not inure to the benefit of
SunPharm, any underwriter or (if there is no underwriter) any Shareholder if a
copy of the final prospectus filed pursuant to Rule 424(b) was not furnished to
the person or entity asserting the loss, liability, claim, or damage at or prior
to the time such furnishing is required by the Securities Act.
(C) Each partly entitled to indemnification under this Section 8 (the
"Indemnified Party") shall give notice to the party required to provide
indemnification (the Indemnifying Party") promptly after such Indemnified Party
has actual knowledge of any claim as to which indemnity may be sought, and shall
permit the Indemnifying Party to assume the defense of any such claim or any
litigation resulting therefrom, provided that counsel for the Indemnifying
Party, who shall conduct the defense of such claim or litigation, shall be
approved by the Indemnified Party (whose approval shall not unreasonably be
withheld), and the Indemnified Party may participate in such defense at such
party's expense, and provided further that the failure of any Indemnified Party
to give notice as provided herein shall not relieve the Indemnifying Party of
its obligation under this Agreement unless the failure to give such notice is
materially prejudicial to an Indemnifying Party's ability to defend such action
and provided further, that the Indemnifying Party shall not assume the defense
for matters as to which there is a conflict of interest between, or separate or
different defenses available to, Indemnifying Party and Indemnified Party. No
Indemnifying Party, in the defense of any such claim or litigation, shall,
except with the consent of each Indemnified Party, consent to entry of any
judgement or enter into any settlement which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
Indemnified Party of a release from all liability in respect to such claim or
litigation. No Indemnified Party shall consent to entry of any judgment or enter
into any settlement without the consent of each Indemnifying Party.
(D) If the indemnification provided for in this Section 8 is
unavailable to any Indemnified Party in respect of any losses, claims, damages
or liabilities referred to therein, then each Indemnifying Party, in lieu of
indemnifying such Indemnified Party, shall contribute to the amount paid or
payable by such Indemnified Party as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by SunPharm on the one hand and all Shareholders offering
securities in the offering (the "Selling Shareholders") on the other from the
offering of SunPharm securities, or (ii) if the allocation provided by clause
(i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of SunPharm on the one hand and the Selling
Shareholder on the other in connection with the statement or omissions which
resulted in such losses, claims, damages or liabilities, as well as any other
relevant, equitable considerations. The relative benefits received by SunPharm
on the one hand and the Selling Shareholder on the other shall be the net
proceeds from the offering (before deducting expenses) received by SunPharm on
the one hand the Selling Shareholder on the other. The relative fault of
SunPharm on the one hand and the Selling Shareholder on the other shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of material fact or the omission or alleged omission to state a
material fact relates to information supplied by SunPharm or by the Selling
Shareholder and the parties' relevant intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.
SunPharm and the Selling Shareholder agree that it would not be just
and equitable if
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contribution pursuant to this Section 8(D) were based solely upon the number of
persons from whom contribution was requested or by any other method of
allocation which does not take account of the equitable considerations referred
to above in this Section 8(D). The amount paid or payable by an Indemnified
Party as a result of the losses, claims, damages and liabilities referred to
above in this Section 8(D) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim,
subject to the provisions of Section 8(C) hereof. Notwithstanding the provisions
of this Section 8(D), no Shareholder shall be required to contribute any amount
or make any other payments under this agreement which in the aggregate exceed
the proceeds received by such Shareholder. No person guilty of fraudulent
misrepresentation (within the meaning of the Securities Act) shall be entitled
to contribution from any person who was not guilty of such fraudulent
misrepresentation.
(E) Notwithstanding the foregoing provision of this Section 8, if
pursuant to an underwritten public offering of capital stock of SunPharm,
SunPharm, the Selling Shareholder and the underwriters enter into an
underwriting or purchase agreement relating to such offering which contains
provisions covering indemnification among the parties thereto in connection with
such offering, the indemnification provisions of this Section 8, to the extent
they are in conflict therewith, shall be deemed inoperative for the purpose of
such offering, except as to any parties to this Agreement who are not parties to
such subsequent underwriting or purchase agreement.
SECTION 9. CERTAIN INFORMATION.
(A) As a condition to exercising the registration rights provided set
forth herein, each Shareholder, with respect to any Registrable Securities
included in any registration, shall furnish SunPharm such information regarding
such Shareholder, the Registrable Securities and the distribution proposed by
such Shareholder as SunPharm may request in writing and as shall be required in
connection with any registration, qualification or compliance referred to in
Section 6.
(B) The failure of any Shareholder to furnish the information requested
pursuant to Section 9(A) shall not affect the obligation of SunPharm under
Section 6 to the remaining Shareholder(s) who furnish such information unless,
in the reasonable opinion of counsel to SunPharm or the underwriters, such
failure impairs or may impair the legality of the registration statement or the
underlying offering.
(C) Each Shareholder, with respect to any Registrable Securities
included in any registration, shall cooperate in good faith with SunPharm and
its underwriters in connection with such registration, including placing such
shares in escrow or custody to facilitate the sale and distribution thereof.
(D) Each Shareholder, with respect to any Registrable Securities
included in any registration, shall make no further sales or other dispositions,
of offers therefor, of such shares under such registration if, during the
effectiveness of such registration statement, an intervening event should occur
which, in the opinion of counsel to SunPharm, makes the prospectus included in
such registration statement no longer comply with the Securities Act, until such
time as such Shareholder has received from the SunPharm copies of a new, amended
or supplemented prospectus complying with the Securities Act.
SECTION 10. TRANSFEREES BOUND. The provisions of Sections 2, 3, 4 and 5
above shall not
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apply to a transfer by sale (as such term is defined herein) by a Shareholder or
some of all his Lockup Shares to his spouse, his lineal descendants (natural or
adopted), his parents, his grandparents, or his siblings, or to an intervivos
trust established on behalf of any such persons. Any such transferees shall
receive and hold the Lockup Shares subject to the terms of this Agreement, and
there shall be no further transfer of such Lockup shares except in accordance
with the terms of this Agreement. Any transferees of Lockup Shares, regardless
of the method by which said transferees acquired said Lockup Shares and provided
that the transfer is not void under Section 2 herein, shall be subject to the
terms of this Agreement, and shall, prior to the receipt of any such Lockup
Shares, agree in writing to be bound by the terms hereof. Any purported transfer
which does not comply with such provision shall be null and void. Any rights
granted to a Shareholder under this Agreement may be assigned to a transferee
under this Section 10 provided that (i) such transfer may otherwise be effected
in accordance with applicable securities laws, and (ii) the Shareholder notifies
SunPharm in writing prior to the transfer and the transferee agrees in writing
to be bound by the provisions of this Agreement..
SECTION 11. LEGEND ON STOCK CERTIFICATES.. SunPharm will cause to
appear on all stock certificates representing the Lockup Shares a conspicuous
legend in such form as the Board of Directors may determine, stating that such
shares are subject to an agreement which restricts the transferability of the
shares, and otherwise describes the rights which may be exercised by the
Shareholder thereof.
SECTION 12. SPECIFIC ENFORCEMENT. In view of the inadequacy of money
damages, if any Shareholder or other person shall fail to comply with the
provisions of Sections 2, 3, 4 or 5 hereof, SunPharm and the Shareholders shall
be entitled, to the extent permitted by applicable law, to injunctive relief in
the case of the violation, or attempted or threatened violation, by a
Shareholder or other person of any of the provisions of such Sections, or to a
decree compelling specific performance by a Shareholder or other person of any
such provisions, or to any other remedy legally allowed to them.
SECTION 13. VOID TRANSFERS.. If any Lockup Shares shall be sold
otherwise than in accordance with the terms and conditions of this Agreement,
such sale shall be void. The persons who would otherwise have been transferees
hereunder regarding such Lockup Shares shall have an
"adverse claim" with the meaning of such term as used in the Uniform Commercial
Code of any state. In addition to, and without prejudice to, any and all other
rights or remedies which may be available to SunPharm and the Shareholders, the
Shareholders agree that SunPharm may, but shall have no obligation to, hold and
refuse to transfer any Lockup Shares, or any certificate therefor, tendered to
it for transfer if the transfer violates the provisions of the Agreement.
SECTION 14. REISSUANCE OF STOCK SHARES. SunPharm shall not transfer or
reissue any of its shares of stock in violation of this Agreement or without
requiring proof of compliance with this Agreement.
SECTION 15. SPOUSES. The spouses of the Shareholders, if any, are fully
aware of, understand and fully consent to and agree to the provisions of the
Agreement and its binding effect upon any community property interest they may
now or hereafter own. They agree that the termination of the marital
relationship of any Shareholder for any reason or their death shall not have the
effect of removing any Lockup Shares otherwise subject to the Agreement from its
coverage. Their awareness, understanding, consents and agreement are evidenced
by their signing
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this Agreement. All stock described in this Agreement shall include the
community property interest of the spouse of a Shareholder.
SECTION 16. EVENTS OF TERMINATION This Agreement shall terminate upon a
change of control of SunPharm or by the mutual agreement of the parties hereto.
SECTION 17. NOTICES.. All notices and communications required or
permitted to be given or made under this Agreement shall be in writing and shall
be deemed to have been duly given or made when sent by mail, postage paid:
(A) If to Foundation, to: Xx. Xxxxxx Xxxxxxxxx
Executive Director
University of Florida
Research Foundation, Inc.
P. O. Xxx 00000
Xxxxxxxxxxx, Xxxxxxx 00000
and to: Xx. Xxxxx Xxxxxxxx
Vice President
University of Florida
000 Xxxxxxx Xxxx
Xxxxxxxxxxx, Xxxxxxx 00000
(B) If to SunPharm, to the attention of Xx. Xxxxxx Xxxx, President,
SunPharm Corporation, 0000 Xxxxxxxxx Xxxx, Xxxxx 000, Xxxxxxxxxxxx, Xxxxxxx,
00000
(C) If to any Director, to the address last shown on the stock record
books of SunPharm, or, in each case, at such other address as may hereafter have
been designated most recently in writing, with specific reference to this
Section, by the addressee to the addressor.
SECTION 18. BINDING FORCE; AMENDMENT; SEVERABILITY. This Agreement
shall be binding on the parties upon execution by SunPharm and by all of the
Shareholders, and may be amended, waived, discharged or terminated by a written
instrument signed by each of the shareholders; NOTWITHSTANDING THE ABOVE,
Directors agree that, in the event Directors holding a two-thirds (2/3) majority
of the Lockup Shares shall vote in favor of such amendment, waiver, discharge,
or termination, each Director will thereafter take such actions as a Shareholder
as are requested and necessary for the amendment, waiver, discharge or
termination to have full force and effect. PROVIDED HOWEVER, that if any of the
rights of a Shareholder are adversely affected by such amendment, waiver,
discharge, or termination separately from the rights of other Shareholders of
the same class of Lockup Shares, then in such instance the written consent of
the Shareholder adversely affected shall be required.
The invalidity or unenforceability of any particular provisions of this
Agreement shall not affect the other provisions hereof, and this Agreement shall
be construed in all respects as if such invalid or unenforceable provisions were
omitted.
SECTION 19. DATE OF TERMINATION. This Agreement shall terminate on
December 31, 1999, unless its term is extended by the written agreement of the
parties as provided in Section 18.
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SECTION 20. MISCELLANEOUS.. This Agreement (a) constitutes the entire
agreement and supersedes for existing one and all prior agreement and
understandings, both written and oral, among the parties with respect to the
subject matter hereof, (b) may be executed in several counterparts, each of
which shall be deemed an original, and all of which shall constitute one and the
same instrument, (c) shall inure to the benefit of, and be binding upon, the
successors, assigns, legatees, distributees, legal representatives and heirs of
each party and is not intended to confer upon any person, other than the parties
and their permitted successors and assigns, any rights or remedies hereunder,
and (d) shall be governed in all respects, including validity, interpretation
and effect, by the laws of the State of Delaware without respect to the conflict
of laws rules of such state. The captions in this Agreement are for convenience
of reference only and shall not affect its interpretation in any respect.
SECTION 21. EFFECTIVE DATE. The effective date of this Agreement is the
date first above written.
IN WITNESS WHEREOF, the undersigned have hereunto set their hands as of
the day and year first above written.
WITNESS: UNIVERSITY OF FLORIDA
RESEARCH FOUNDATION
By /s/ XXXXXX X. Xxxxxxxxx
-------------------------------
Xxxxxx X. Xxxxxxxxx
Its Executive Director
SUNPHARM CORPORATION
By /s/ XXXXXX Xxxx
-------------------------------
Xxxxxx Xxxx, its President
SHAREHOLDERS
/s/ XX XXXXXXX
-------------------------------
Xx. Xxxxxx X. Xxxxxxx
/s/ XXXXX X. Xxxxxxx
-------------------------------
Xxxxx X. Xxxxxxx
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/s/ XXXXXX X. XXXXXX
-------------------------------
Xxxxxx Xxxxxx
/s/ J REJEANGE
-------------------------------
Xxxxxxx Xxxxxxxx
/s/ XXXXXX X. Xxxxxxxx
-------------------------------
Xxxxxx X. Xxxxxxxx
/s/ XXXXXX X. Xxxxxxxxxxx
-------------------------------
Xxxxxx X. Xxxxxxxxxxx
/s/ XXXXXXX X. Xxxxx
-------------------------------
Xxxxxxx X. Xxxxx
/s/ XXXXXX Xxxx
-------------------------------
Xxxxxx Xxxx
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