Execution Copy
TERMINATION AGREEMENT
ELAN CORPORATION, PLC
ELAN PHARMA INTERNATIONAL LTD.
ELAN INTERNATIONAL SERVICES, LTD.
AND
INCARA PHARMACEUTICALS CORPORATION
AND
INCARA DEVELOPMENT, LTD.
INDEX
Section Heading Page
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1 DEFINITIONS 3
2 TERMINATION OF THE NEWCO AGREEMENTS 5
3 REPRESENTATIONS, WARRANTIES, CONFIRMATIONS AND
INDEMNITIES 7
4 INTELLECTUAL PROPERTY 12
5 RIGHTS RELATED TO SECURITIES 13
6 SALE OF SHARES AND COMPLETION 13
7 CONFIDENTIALITY 14
8 WAIVER OF ACCRUED RIGHTS/MUTUAL RELEASES 18
9 GENERAL 18
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THIS TERMINATION AGREEMENT made this 19th day of November, 2003 (this
"Agreement")
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 Corp");
(2) ELAN PHARMA INTERNATIONAL LIMITED, a private limited company incorporated
under the laws of Ireland, and having its registered office at XXX Xxxxx,
Xxxxxxx Xxxxxxxx Xxxx, Xxxxxxx, Xxxxxx Xxxxx, Xxxxxxx ("EPIL Xxxxxxx");
(3) ELAN INTERNATIONAL SERVICES, LTD., an exempted limited liability company
incorporated under the laws of Bermuda, and having its registered office at
Xxxxxxxxx Xxxxx, 0 Xxxxxx Xx., Xxxxxxxx, Xxxxxxx ("XXX");
(4) INCARA PHARMACEUTICALS CORPORATION (FORMERLY INTERCARDIA, INC.), a Delaware
corporation having its principal place of business at 79 X.X. Xxxxxxxxx
Drive, 4401 Research Commons, Suite 200, Research Triangle Park, North
Carolina 27709, United States of America ("Incara"); and
(5) INCARA DEVELOPMENT, LTD., an exempted company incorporated under the laws
of Bermuda, and having its registered office at Xxxxxxxxx Xxxxx, 0 Xxxxxx
Xx., Xxxxxxxx, Xxxxxxx.
RECITALS
A. The Parties entered into various agreements whereby Elan Corp, EPIL
Xxxxxxx, EIS and Incara established the joint venture company, Newco, and
Elan Corp, EPIL Xxxxxxx, EIS and Incara each licensed certain intellectual
property to Newco for a specified field of use. Specifically:
(i) Elan Corp, EIS, EPIL Xxxxxxx, Incara and Newco entered into a
Subscription, Joint Development and Operating Agreement dated January
19, 2001 (the "JDOA");
(ii) Elan Corp, EPIL Xxxxxxx, and Newco entered into a License Agreement
dated January 19, 2001 (the "Elan License Agreement");
(iii) Newco, Incara and EIS entered into a Registration Rights Agreement
with respect to the capital stock of Newco dated December 21, 2000
(the "Newco Registration Rights Agreement"); and
(iv) Incara and Newco entered into a License Agreement dated January 19,
2001 (the "JVP License Agreement").
B. The JDOA, Elan License Agreement, JVP License Agreement and Newco
Registration Rights Agreement are sometimes hereinafter collectively
referred to in this Agreement as the "Newco Agreements". The Elan License
Agreement and JVP License Agreement are sometimes hereinafter together
referred to in this Agreement as the "License Agreements".
C. The Parties also entered into agreements whereby Incara sold and EIS and
EPIL Xxxxxxx purchased certain securities of Incara and the Parties agreed
to certain matters related to the ownership of such securities.
Specifically:
(i) EIS, EPIL Xxxxxxx and Incara entered into a Securities Purchase
Agreement dated December 21, 2000 (as thereafter amended, the
"Securities Purchase Agreement");
(ii) EIS, EPIL Xxxxxxx, Aeolus Pharmaceuticals Inc. ("Aeolus") and Incara
entered into a Securities Purchase Agreement dated as of May 15, 2002,
as amended by a letter agreement executed on January 9, 2003 among
EIS, EPIL Xxxxxxx, Incara and Aeolus (the "January 9 Letter
Agreement") (as so amended, the "Series B Securities Purchase
Agreement");
(iii) EIS and Incara entered into a letter agreement dated January 7, 2003
with respect to the Series B Shares (as defined therein) (the "January
7 Letter Agreement");
(iv) EIS, EPIL Xxxxxxx and Incara entered into an Amended and Restated
Registration Rights Agreement with respect to the capital stock of
Incara dated as of May 15, 2002 (the "JVP Registration Rights
Agreement");
(v) Incara executed and delivered to EIS a Warrant, dated as of December
21, 2000, to purchase 22,191 shares of Series B Convertible Preferred
Stock, par value US$0.01 per share ("Series B Preferred"), of Incara
(the "Warrant");
(vi) Incara executed and delivered to EPIL Xxxxxxx a Convertible Promissory
Note, dated December 21, 2000, in the original principal amount of up
to U.S.$4,806,000 (as thereafter amended, the "Note");
(vii) EIS, EPIL Xxxxxxx and Incara entered into an Agreement and Amendment,
dated as of January 22, 2001, a Second Agreement and Amendment, dated
as of January 22, 2001, and a Third Agreement and Amendment, dated as
of January 22, 2001, with respect to certain matters relating to the
foregoing; and
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(viii) EIS, EPIL Xxxxxxx, EPIL III and Incara entered into an Agreement and
Fourth Amendment, dated as of February 13, 2002 (the "Fourth
Amendment"), with respect to certain matters relating to the
foregoing, including the conversion of a portion of the outstanding
principal of the Note into shares of common stock, par value $0.001
per share, of Incara and Series B Preferred.
D. Pursuant to that certain (i) letter agreement by and among Elan Corp,
Incara and Newco dated June 6, 2003, as set forth in Schedule 6 (the "Elan
Letter"); and (ii) letter agreement by and among JVP, Newco and Elan Corp
dated June 6, 2003 as set forth in Schedule 6 (the "JVP Letter" and
together with the Elan Letter, hereinafter sometimes referred to as the
"Letter Agreements"), Elan Corp, Incara and Newco terminated the License
Agreements (including all the provisions of the License Agreement expressly
stated to survive termination, with the exception of the confidentiality
obligations set forth in Clause 9 of the License Agreements) and all rights
and licenses granted to Newco pursuant to the License Agreements.
E. The Parties wish to (i) confirm the termination in full of the License
Agreements; (ii) terminate in full the JDOA and Newco Registration Rights
Agreement; and (iii) set forth their agreement in relation to other
matters, including, inter alia, the transfer of shares by EIS to Incara,
and (iii) amend certain agreements all as set forth below in relation to
matters related to security holdings in Incara.
IN CONSIDERATION OF THE MUTUAL COVENANTS CONTAINED HEREIN, AND OTHER GOOD AND
VALUABLE CONSIDERATION, THE RECEIPT AND ADEQUACY OF WHICH ARE HEREBY
ACKNOWLEDGED, IT IS HEREBY AGREED AS FOLLOWS:
1 DEFINITIONS
Capitalized terms used in this Agreement shall have the same meanings
assigned to them in the Newco Agreements, unless such terms are expressly
defined to the contrary in this Agreement.
"Affiliate" shall mean any corporation or entity controlling, controlled or
under the common control of any other corporation or entity, excluding, in
the case of Elan Corp, an Elan JV. For the purpose of this definition, (i)
"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;
and (ii) Newco shall not be an Affiliate of Elan Corp, EPIL III or EIS.
"Balance Sheet" shall mean the unaudited balance sheet of Newco as of the
Balance Sheet Date, as set forth in Schedule 1.
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"Balance Sheet Date" shall mean August 31, 2003.
"Effective Date" shall mean the date of this Agreement.
"Elan" shall mean Elan Corp and its Affiliates.
"Elan Improvements" shall mean improvements to the Elan Patents and/or the
Elan Know-How, developed (i) by Elan outside the Project, (ii) by Elan, JVP
or Newco or by a third party (under contract with Newco, Elan or JVP)
pursuant to the Project, and/or (iii) jointly by any combination of Elan,
JVP, Newco or a third party (under contract with Newco, Elan or JVP)
pursuant to the Project.
"Elan JV" shall mean an entity that Elan and a third party (i) establish or
have established; (ii) take shareholdings in or have a right to take
shareholdings in; and (iii) grant certain licenses in and to certain
intellectual property rights for the purpose of implementing a strategic
alliance.
"Elan Know-How" shall have the meaning set forth in the Elan License
Agreement.
"Elan Patents" shall have the meaning set forth in the Elan License
Agreement.
"Elan Trademark" shall have the meaning set forth in the Elan License
Agreement.
"EPIL III" shall mean Elan Pharmaceuticals Investment III, Ltd. an exempted
limited liability company incorporated under the laws of Bermuda.
"Exchange Right" shall have the meaning set forth in the JVP Certificate of
Designations.
"Field" shall have the meaning set forth in the JVP License Agreement and
Elan License Agreement.
"Force Majeure" shall mean causes beyond a Party's reasonable control,
including, without limitation, acts of God, fires, strikes, acts of war, or
intervention of a governmental authority.
"JVP" shall mean Incara and its Affiliates.
"JVP Certificate of Designations" shall mean that certain Certificate of
Designations, Preferences and Rights of Series B Convertible Preferred
Stock and Series C Convertible Exchangeable Preferred Stock of Incara filed
with the Delaware Secretary of State on March 18, 2002.
"JVP Improvements" shall mean improvements to the JVP Patents and/or the
JVP Know-How, developed (i) by JVP outside the Project, (ii) by JVP, Elan
or
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Newco or by a third party (under contract with Newco, Elan or JVP) pursuant
to the Project, and/or (iii) jointly by any combination of JVP, Elan, Newco
or a third party (under contract with Newco, Elan or JVP) pursuant to the
Project.
"JVP Know-How" shall mean Incara Know-How (as such term is defined in the
JVP License Agreement).
"JVP Patents" shall mean Incara Patents (as such term is defined in the JVP
License Agreement).
"JVP Trademarks" shall mean Incara Trademarks (as such term is defined in
the JVP License Agreement).
"Marketing Study" shall have the meaning set forth in Schedule 4.1.3.
"Newco" shall mean Incara Development, Ltd.
"Newco Intellectual Property" shall have the meaning set forth in the JDOA.
"Party" shall mean Elan Corp, EPIL Shannon, EIS, Incara or Newco, as the
case may be, and "Parties" shall mean all such parties together.
"Project" shall have the meaning set forth in the JDOA.
"Product" shall have the meaning set forth in the JVP License Agreement and
Elan License Agreement.
"Research and Development Program" shall mean R&D Program(s), as such term
is defined in the JDOA.
"Territory" shall mean all of the countries of the world.
"United States Dollar" and "US$" and "$" shall mean the lawful currency of
the United States of America.
2. TERMINATION OF THE NEWCO AGREEMENTS
2.1. Subject to the provisions of Clause 2.2 hereof, the Parties hereby
agree to terminate the JDOA and Newco Registration Rights Agreement,
including without limitation, those provisions expressly stated to
survive termination, in each case with effect from the Effective Date.
All the provisions of the JDOA and Newco Registration Rights Agreement
shall terminate forthwith with effect from the Effective Date and be
of no further legal force or effect.
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For the avoidance of doubt, this Agreement will not terminate or
supersede any provision of the Note, Warrant, Securities Purchase
Agreement or the JVP Registration Rights Agreement, which shall remain
in full force and effect and unchanged, save to any extent
specifically set forth herein.
2.2. For the avoidance of doubt and without prejudice to the generality of
the foregoing Clause 2.1 or the Letter Agreements, the Parties hereby
acknowledge and agree as follows:
2.2.1. the Management Committee and the R&D Committee (as such terms
are defined in the JDOA) shall each be dissolved forthwith with
effect from the Effective Date and thereby cease to have any
function;
2.2.2. the EIS Director, Xxxxxx Xxxxxxxx, holding office with Newco
immediately prior to the Effective Date shall resign;
2.2.3. the nominees on the Management Committee of the EIS Director
shall be deemed to have been removed from the Management
Committee by the EIS Director immediately prior to the
dissolution of the Management Committee pursuant to Clause 2.2.1;
2.2.4. the nominees on the R&D Committee of the nominees on the
Management Committee of the EIS Director, shall be deemed to have
been removed from the R&D Committee by the nominees on the
Management Committee of the EIS Director immediately prior to the
dissolution of the Management Committee pursuant to Clause 2.2.1;
2.2.5. all rights granted to Newco pursuant to the Elan License
Agreement to use the Elan Patents, the Elan Know-How, the Elan
Improvements and the Elan Trademarks were terminated pursuant to
the Elan Letter;
2.2.6. all rights granted to Newco pursuant to the JVP License
Agreement to use the JVP Patents, the JVP Know-How, the JVP
Improvements and the JVP Trademarks were terminated pursuant to
the JVP Letter;
2.2.7 the Parties shall terminate or shall cause to be terminated any
and all research and development work being conducted, if any, in
connection with or pursuant to any Research and Development
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Program of Newco, the Newco Agreements, or otherwise on behalf of
Newco;
2.2.8 the Parties shall terminate or cause to be terminated any and
all technical services and assistance being conducted, if any, in
connection with the Newco Agreements;
2.2.9 for the avoidance of doubt, none of the Parties have any
obligation to provide working capital, research or development
funding, or other funding or financing of any nature to Newco;
and
2.2.10 Elan does not have any obligation to pay any milestone payment
or make any milestone investment to or in Newco or JVP whether
relating to the Project, the achievement of any objectives set
forth therein or otherwise.
2.3 Each of the Parties acknowledges and agrees with the other Parties
that, as of the Effective Date, no monies are owed or are refundable
by any of the Parties to the others pursuant to the Newco Agreements.
For the avoidance of doubt, the Parties acknowledge that Newco is
liable to pay any fees due and owing to Codan Corporate Administrative
Services ("Codan") upon the Effective Date, and thereafter, provided,
however, that Elan acknowledges that on the Effective Date Newco owed
Codan US$2,038.31 which JVP agrees to pay on behalf of Newco, and Elan
agrees to pay JVP on the Effective Date US$405.62 which is 19.9% of
the amount owed to Codan.
3 REPRESENTATIONS, WARRANTIES, CONFIRMATIONS AND INDEMNITIES
3.1 Sub-licenses:
Newco represents and warrants to the other Parties that it has not
granted any sub-licenses or any other rights of any nature to any
third parties pursuant to the Elan License Agreement or the JVP
License Agreement.
3.2 JVP Shares:
Incara confirms to the other Parties that it is the legal and
beneficial owner of the following:
3.2.1 6,000 shares of Newco's Common Shares (as defined in the JDOA);
and
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3.2.2 3,612 shares of Newco's Preference Shares (as defined in the
JDOA).
3.3 EIS Shares:
EIS confirms to the other Parties that it is the legal and beneficial owner
of 2,388 shares of Newco's Preference Shares (the "EIS Shares").
3.4 Balance Sheet:
3.4.1 JVP represents and warrants to the other Parties that, to its actual
knowledge, the Balance Sheet is accurate and that, since the Balance
Sheet Date, there has been no material adverse change in the financial
position or prospects of Newco.
3.4.2 JVP represents and warrants to the other Parties that, to its actual
knowledge, there are no other creditors of Newco other than as
described in the Balance Sheet.
3.4.3 JVP represents and warrants to the other Parties that all amounts
owing to third party creditors arising under the Newco Third Party
Agreements (as defined in Clause 3.5.2) or otherwise have been paid in
full by JVP or Newco other than the amount of $25,200 owing to Opocrin
sPa which JVP hereby covenants to pay to Opocrin sPa within 30 days of
receiving a valid invoice from Opocrin sPa..
3.5 Third party agreements / Orders / Claims:
3.5.1 Each of the Parties confirms to the other Parties hereto that, as of
the Effective Date, to its actual knowledge, Newco is not a party to,
or bound by, any judgment, order, decree or other directive of or
stipulation with any court or any governmental or regulatory
authority.
3.5.2 JVP represents and warrants to the other Parties that Newco is not a
party to, or bound by, or is a third party beneficiary of any
agreement with any third party, except for the Newco Agreements, other
than as set out in Schedule 3.5.2 ("Newco Third Party Agreements").
For the avoidance of doubt and with reference to the indemnity in
Clause 3.8.1, the Parties agree that the indemnity in Clause 3.8.1
shall extend to any claims, losses, liabilities and/or damages arising
from such Newco Third Party Agreements.
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3.5.3 Each of the Parties confirms to the other Parties hereto that, as of
the Effective Date, to its actual knowledge, there are no claims,
suits or proceedings pending or threatened against Newco.
3.6 Regulatory Applications:
Each of the Parties confirms to the other Parties that, prior to and as of
the Effective Date, except as set forth in Schedule 3.6, no regulatory
applications have been filed by Newco or by any Party on behalf of Newco
with any government authority in any part of the world for any product,
including without limitation Newco Intellectual Property or otherwise
howsoever in relation to the Project.
3.7 Exclusion of warranties / liability:
WITH REFERENCE TO THE TRANSFER BY EIS TO JVP OF THE EIS SHARES AS PROVIDED
BY CLAUSE 6 ON THE EFFECTIVE DATE (BUT WITHOUT PREJUDICE TO EIS'S
OBLIGATION UNDER CLAUSE 6.1.1 HEREOF TO TRANSFER THE EIS SHARES TO INCARA
FREE FROM ALL LIENS, CHARGES AND ENCUMBRANCES), THE PARTIES ACKNOWLEDGE AND
AGREE THAT EIS AND ITS AFFILIATES MAKE NO REPRESENTATION OR WARRANTY OF ANY
NATURE TO JVP OR ANY OTHER PERSON IN RELATION TO NEWCO OR ANY OF ITS
AFFAIRS PAST, PRESENT OR FUTURE.
INCARA ACKNOWLEDGES THAT IT IS ENTERING INTO THIS AGREEMENT IN RELIANCE
EXCLUSIVELY ON ITS OWN BUSINESS JUDGMENT, THE INFORMATION WHICH HAS BEEN
AVAILABLE TO IT AS A SHAREHOLDER OF NEWCO AND OTHERWISE AND ON THE DUE
DILIGENCE IT HAS CARRIED OUT IN RELATION TO NEWCO.
EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT, ALL OTHER WARRANTIES,
CONDITIONS OR REPRESENTATIONS, EXPRESS OR IMPLIED, STATUTORY OR OTHERWISE,
ARE HEREBY EXPRESSLY EXCLUDED BY THE PARTIES.
NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THIS AGREEMENT, NO PARTY SHALL
BE LIABLE TO ANY OTHER PARTY BY REASON OF ANY REPRESENTATION OR WARRANTY,
CONDITION OR OTHER TERM OR ANY DUTY OF COMMON LAW, OR UNDER THE EXPRESS
TERMS OF THIS AGREEMENT, FOR ANY CONSEQUENTIAL SPECIAL OR INCIDENTAL OR
PUNITIVE LOSS OR DAMAGE (WHETHER FOR LOSS OF CURRENT OR FUTURE PROFITS,
LOSS OF
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ENTERPRISE VALUE OR OTHERWISE) AND WHETHER OCCASIONED BY THE NEGLIGENCE OF
THE RESPECTIVE PARTIES, THEIR EMPLOYEES OR AGENTS OR OTHERWISE.
3.8 Indemnity by JVP and Newco:
3.8.1 Incara and Newco, jointly and severally, hereby agree to indemnify
and hold harmless Elan Corp, EIS, and EPIL Xxxxxxx, their respective
Affiliates, officers, directors, agents, representatives, employees
and shareholders, and any person holding office on or prior to the
Effective Date as an EIS Director (as defined in the JDOA) (or any
alternate director of the EIS Director) or as a member of the
Management Committee or the R&D Committee (each such person or entity
referred to as an "Indemnified Party") against any claims, losses,
liabilities or damages and expenses (including reasonable attorneys'
fees and expenses) incurred or sustained by such Indemnified Party
arising in relation to any claim or proceedings made against Newco or
an Indemnified Party which relate in any way to the activities of
Newco, past present or future, including without limitation, claims
arising with respect to the conduct of clinical trials (if any) by
Newco, or by Incara or any other person or entity on behalf of Newco
whether in connection with the Project or otherwise.
3.8.2 For the avoidance of doubt and without prejudice to the generality of
Clause 3.8.1, Incara and Newco, jointly and severally, shall indemnify
and hold harmless Elan against any claims, losses, liabilities or
damages and expenses (including reasonable attorneys' fees and
expenses) which may arise in relation to any claim or proceedings made
against Elan Corp or any of its Affiliates alleging infringement or
other unauthorized use of the proprietary rights of a third party
arising from the manufacture, importation, use, offer for sale, sale
or other commercialization of any Product, the Newco Intellectual
Property and/or any technology related thereto.
3.8.3 For the avoidance of doubt and with reference to the indemnity in
Clause 3.8.1, the Parties acknowledge that clinical trials ("Clinical
Trials") were carried out by Incara on behalf of Newco and agree that
the indemnity in Clause 3.8.1 shall extend to any claims, losses,
liabilities or damages arising from such Clinical Trials.
3.8.4 Prior to the Effective Date, JVP shall furnish Elan Corp with copies
of all policies of comprehensive general liability insurance and/or
other insurance coverage (the "Policies") which it holds in respect of
the Clinical Trials referred to in Clause 3.8.3.
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JVP shall maintain the Policies for a period of 5 years from the
Effective Date, maintaining at all times at a minimum, the levels of
cover evidenced in the Policies, noting Elan Corp as an additional
insured only with regard to the Clinical Trials, and shall, at the
reasonable request of Elan Corp from time to time, furnish to Elan
Corp evidence that all premiums or other payments on the Policies are
fully paid up and the Policies are subsisting. JVP shall require the
consent of Elan Corp to make any modification to the Policies that
alters Elan Corp's coverage thereunder or to take any action to
terminate the Policies.
3.9 Organization and authority:
Each of the Parties represents and warrants to the other Parties that it 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 enter into this Agreement and to carry out the transactions
contemplated hereby.
3.10 Approvals:
Each of the Parties represents and warrants to the other Parties that no
permit, authorization, consent or approval of or by ("Approval"), or any
notification of or filing with ("Filing"), any person or entity
(governmental or otherwise) is required in connection with the execution,
delivery or performance of this Agreement by such Party, or if any such
Approval or Filing is so required, that same has been obtained or filed
prior to the Effective Date.
3.11 Investment Representations:
Incara hereby represents and warrants to the other Parties that, as of the
Effective Date, (i) it is sophisticated in transactions of this type and
capable of evaluating the merits and risks of its investment in Newco, (ii)
it has not been formed solely for the purpose of making this investment and
is acquiring the EIS 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, and no other person has a
direct or indirect interest, beneficial or otherwise in the EIS Shares,
(iii) it understands that the EIS Shares have not been registered under the
Securities Act of 1933, as amended (the "Securities Act"), or applicable
state and foreign securities laws by reason of a specific exemption from
the registration provisions of the Securities Act and applicable state and
foreign securities laws, the availability of which depends upon, among
other things, the bona fide nature of the investment intent and the
accuracy of its representations as expressed herein and (iv) it understands
that no public market now exists for
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any of the EIS Shares and that there is no assurance that a public market
will ever exist for such shares.
3.12 Trademark Applications:
JVP represents and warrants to the other Parties that neither Newco nor JVP
has filed for any trademark protection or has not adopted any trademark in
connection with Newco's business or any product or service provided
thereunder.
3.13 Representation and Warranties as of the Effective Date:
Except where expressly stated otherwise, each of the representations and
warranties in this Agreement are made as of the Effective Date.
4 INTELLECTUAL PROPERTY
4.1 Ownership:
On and following the Effective Date:
4.1.1 For the avoidance of doubt, the Elan Patents, the Elan Know-How,
the Elan Improvements and the Elan Trademarks shall remain the
sole and exclusive property of Elan.
A full list of the Elan Improvements developed pursuant to the
Project, or otherwise pursuant to the Newco Agreements is set
forth in Schedule 4.1.1.
4.1.2 For the avoidance of doubt, the JVP Patents, the JVP Know-How,
the JVP Improvements and the JVP Trademarks shall remain the sole
and exclusive property of JVP.
A full list of the JVP Improvements developed pursuant to the
Project, or otherwise pursuant to the Newco Agreements is set
forth in Schedule 4.1.2.
4.1.3 All Newco Intellectual Property shall remain the sole and
exclusive property of Newco.
A full list of the Newco Intellectual Property developed pursuant
to the Project, or otherwise pursuant to the Newco Agreements, is
set forth in Schedule 4.1.3.
4.2 License to Marketing Study:
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4.2.1 Newco and JVP hereby grant to Elan, a fully paid-up, perpetual,
royalty-free, sublicensable, transferable non-exclusive license to the
Marketing Study referred to in Schedule 4.1.3 to research, develop,
make and have made, import, use, offer for sale and sell any product
in and outside the Field in the Territory.
4.2.2 Immediately after the Effective Date, Newco and JVP shall provide
Elan with copies of all documentation and related information derived
in connection with the Marketing Study referred to in Schedule 4.1.3.
4.2.3 Newco and JVP hereby represent and warrant to Elan that, to its
actual knowledge, there are no agreements between any third party that
would limit or restrict Elan from practicing, using or otherwise
exploiting the rights granted hereunder by Newco and JVP.
5 RIGHTS RELATED TO SECURITIES
Nothing contained herein shall constitute a waiver of any right of EPIL
Xxxxxxx, EPIL III or EIS or any of their respective successors and assigns
with respect to their respective ownership of securities in Incara under
any agreements of any kind in existence with JVP with respect thereto,
which agreements shall remain unmodified and in full force and effect,
except as set forth in Schedule 5 hereof.
6 SALE OF SHARES AND COMPLETION
6.1 Subject to the terms of this Agreement,
6.1.1 EIS shall sell as legal and beneficial owner and Incara shall
purchase, free from all liens, charges and encumbrances and
together with all rights now or hereafter attaching to them, the
EIS Shares; and
6.1.2 the EIS Shares will be sold by EIS to Incara for a total
consideration of $10 ("Consideration").
6.2 On the Effective Date, Elan and JVP shall take or (to the extent that
the same is within its powers) cause to be taken the following steps
prior to or at directors and shareholders meetings of Newco, or such
other meetings, as appropriate:
6.2.1 the delivery by EIS to JVP of a stock transfer form in respect
of the EIS Shares duly executed by EIS in favor of JVP or as it
may direct together with the related share certificates;
6.2.2 the payment by JVP to EIS of the Consideration;
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6.2.3 the transfer to JVP (or as it may direct) of the share register,
and all books and records of Newco in the possession of Elan
(including any minute books and any company seal(s));
6.2.4 the change of the registered office of Newco from Xxxxxxxxx
Xxxxx, 0 Xxxxxx Xx., Xxxxxxxx, Xxxxxxx;
6.2.5 the resignation of the EIS Director on Newco's Board of
Directors and any alternate director of the EIS Director;
6.2.6 the adoption of new Bye-Laws of Newco;
6.2.7 the modification, as appropriate, by board resolutions of Newco
of matters such as the removal of EIS as book keeper for Newco,
the removal of EIS representatives as authorized signatories of
Newco's bank account, the resignation of the Company Secretary
and any other related matters whatsoever; and
6.2.8 any other steps required by this Agreement.
6.3 JVP shall, following the Effective Date, promptly notify the Bermuda
Monetary Authority of the transfer of the EIS Shares.
6.4 On the Effective Date, Elan shall pay to JVP:
6.4.1 US$405.62 in accordance with Clause 2.3;
6.4.2 the sum of US$1,000, which represents 19.9% of the estimated fees to
dissolve Newco. If actual costs of dissolution of Newco exceed
US$5,000.00, Elan will promptly reimburse JVP for 19.9% of all
additional expenses of the dissolution; and
6.4.3 19.9% of the estimated fees of the annual audit of Newco for the
fiscal year ending September 30, 2003.
The Parties agree that the total amount payable by Elan under Clause
6.4.2 and Clause 6.4.3 shall not exceed $3,000.
7 CONFIDENTIALITY
7.1 Confidentiality:
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7.1.1 Clause 9 of the Elan License Agreement and Clause 9 of the JVP
License Agreement are hereby terminated, of no further force and
effect and, with effect from the Effective Date, deemed
superceded by the confidentiality provisions of this Clause 7.
7.1.2 The Parties agree that it may be necessary pursuant to this
Agreement, from time to time, to disclose to each other
confidential and proprietary information, including without
limitation, inventions, trade secrets, specifications, designs,
data, know-how and other proprietary information, processes,
services and business of the disclosing Party.
The foregoing together with the terms of this Agreement shall be
referred to collectively as "Additional Confidential
Information".
The Parties also agree that it may have been necessary to
disclose to each other Confidential Information (as defined in
the JDOA) pursuant to the Newco Agreements.
Together Additional Confidential Information and Confidential
Information shall be referred to collectively as "Proprietary
Information".
7.1.3 Save as otherwise specifically provided herein, and subject to
Clause 7.2 and Clause 7.3, each Party shall disclose Proprietary
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, and not to any other third party.
Each Party further agrees to inform all such employees,
representatives and agents of the terms and provisions of this
Agreement relating to Proprietary Information and their duties
hereunder and to obtain their agreement hereto as a condition of
receiving Proprietary Information.
Each Party shall exercise the same standard of care as it would
itself exercise in relation to its own confidential information
(but in no event less than a reasonable standard of care) to
protect and preserve the proprietary and confidential nature of
the Proprietary Information disclosed to it by another Party.
Each Party shall promptly, upon request of another Party, return
all documents and any copies thereof containing Proprietary
Information belonging to, or disclosed by, such Party, save that
it
15
may retain one copy of the same solely for the purposes of
ensuring compliance with this Clause 7.
7.1.4 Any breach of this Clause 7 by any person informed by one of the
Parties is considered a breach by the Party itself.
7.1.5 Proprietary Information shall be deemed not to include:
(1) information which is in the public domain;
(2) information which is made public through no breach of this
Agreement;
(3) information which is independently developed by a Party, as
evidenced by such Party's records;
(4) information that becomes available to a receiving Party on a
non-confidential basis, whether directly or indirectly, from
a source other than another Party, which source did not
acquire this information on a confidential basis.
7.1.6 The provisions relating to confidentiality in this Clause 7
shall remain in effect during the term of this Agreement, and for
a period of 10 years following the Effective Date of this
Agreement.
7.1.7 The Parties agree that the obligations of this Clause 7 are
necessary and reasonable in order to protect the Parties'
respective businesses, and each Party agrees that monetary
damages may be inadequate to compensate a Party for any breach by
another Party of its covenants and agreements set forth herein.
The Parties agree that any such violation or threatened violation
may cause irreparable injury to a Party and that, in addition to
any other remedies that may be available, in law and equity or
otherwise, each Party shall be entitled to seek injunctive relief
against the threatened breach of the provisions of this Clause 7,
or a continuation of any such breach by another Party, specific
performance and other equitable relief to redress such breach
together with damages and reasonable counsel fees and expenses to
enforce its rights hereunder.
7.2 Announcements:
Subject to Clause 7.3, no announcement or public statement concerning the
existence, subject matter or any term of this Agreement shall be made
16
by or on behalf of any Party without the prior written approval of the
other Parties.
The terms of any such announcement shall be agreed in good faith by the
Parties.
7.3 Required Disclosures:
7.3.1 A Party (the "Disclosing Party") will be entitled to make an
announcement or public statement concerning the existence, subject
matter or any term of this Agreement, or to disclose Proprietary
Information that the Disclosing Party is required to make or disclose
pursuant to:
(1) a valid order of a court or governmental authority; or
(2) any other requirement of law or any securities or stock exchange;
provided, however, that if the Disclosing Party becomes legally
required to make such announcement, public statement or disclosure
hereunder, the Disclosing Party shall give the other Parties prompt
notice of such fact to enable the other Parties to seek a protective
order or other appropriate remedy concerning any such announcement,
public statement or disclosure; and provided further that no prior
approval or notice shall be required under this Clause 7.3 for the
inclusion in filings with the US Securities and Exchange Commission or
any foreign securities or regulatory body of a statement that the
Parties have terminated the Newco Agreements and the filing of this
Agreement as an exhibit to such filings.
The Disclosing Party shall fully co-operate with the other Parties in
connection with that other Party's or Parties' efforts to obtain any
such order or other remedy.
If any such order or other remedy does not fully preclude
announcement, public statement or disclosure, the Disclosing Party
shall make such announcement, public statement or disclosure only to
the extent that the same is legally required.
7.3.2 Each of the Parties shall be entitled to provide a copy of this
Agreement (and any subsequent amendments hereto) and the Newco
Agreements to a potential third party purchaser in connection with
Clause 9.2.1(2); provided, however, that the relevant third party
purchaser or assignee has entered into a
17
confidentiality agreement on terms no less protective than the terms
of this Clause 7.
8 WAIVER OF ACCRUED RIGHTS/MUTUAL RELEASES
8.1 With effect from the Effective Date, each Party and each of its
Affiliates ("Releasor"):
8.1.1 waives any accrued rights that Releasor may have accrued against
the other Parties and each of its Affiliates, officers,
directors, representative, agents and employees and the assigns
and successors in interest of any of the foregoing entities
("Releasees"), whether known or unknown, foreseen or unforeseen,
fixed or contingent, of any nature whatsoever from the beginning
of time to the Effective Date under the Newco Agreements; and
8.1.2 fully and finally releases and discharges the Releasees from any
and all manner of actions, claims, promises, debts, sums of
money, demands, obligations, in law or in equity, directly or
indirectly, whether known or unknown, foreseen or unforeseen,
fixed or contingent, of any nature whatsoever that Releasor may
have by reason of any act, omission, matter, provision, cause or
thing whatsoever from the beginning of time to the Effective Date
under the Newco Agreements.
8.2 For the avoidance of doubt the provisions of this Clause 8 shall not
in any way act as a waiver by any of the Parties in respect of any of
the provisions set forth in this Agreement (including, for the
avoidance of doubt, Clause 3.8.1).
9 GENERAL
9.1 Governing law and jurisdiction:
9.1.1 This Agreement shall be governed by and construed in accordance
with the laws of the State of New York, without regard to
conflicts of law principles under the laws of the State of New
York.
9.1.2 For the purposes of this Agreement, the Parties submit to the
nonexclusive jurisdiction of the State and Federal Courts of New
York.
9.2 Assignment:
18
9.2.1 Subject to Clause 9.2.2, this Agreement shall not be assigned by
any Party without the prior written consent of the others, save
that any Party:
(1) may assign this Agreement in whole or in part and delegate
its duties hereunder to its Affiliate or Affiliates without
such consent; and
(2) may assign its rights and obligations to a successor
(whether by merger, consolidation, reorganization or other
similar event) or purchaser of all or substantially all of
its assets relating to such Party's technology related to
this Agreement, provided that such successor or purchaser
has agreed in writing to assume all of such Party's rights
and obligations hereunder and a copy of such assumption is
provided to the other Parties.
9.2.2 For the avoidance of doubt, nothing in this Clause 9.2 shall
affect the provisions governing assignment of securities in
Schedule 5 hereof.
9.3 Notices:
9.3.1 Any notice to be given under this Agreement shall be sent in writing
in English by registered airmail, internationally recognized courier
or telefaxed to the following addresses:
If to Newco at:
Incara Development Ltd.
Xxxxxxxxx Xxxxx
0 Xxxxxx Xx.
Xxxxxxxx
Xxxxxxx
Attention:
Telephone:
Fax:
with a copy to JVP at the address below.
If to JVP at:
Incara Pharmaceuticals Corporation,
00 X.X. Xxxxxxxxx Xxxxx,
0000 Research Commons,
19
Suite 200,
Post Office Box 14287,
Research Xxxxxxxx Xxxx, XX 00000
XXX
Attn: Chief Executive Officer
Telephone919 558 8688
Fax: 000 000 0000
with a copy to:
Xxxxxx Xxxxxxx Xxxxx & Xxxxxx LLP
0000 Xxxx Xxxxx Xxxxx,
Xxxxx 000,
Xxxxxxx, XX 00000-0000
XXX
Attention: Xxxxx X. Xxxxxxx
Telephone919 781 4000
Fax: 000 000 0000
If to Elan, EIS and/or EPIL Xxxxxxx at:
Elan Corporation, plc
Elan Pharma International Limited
Elan International Services, Ltd.
C/o Elan International Services, Ltd.
000 Xx. Xxxxx Xxxxx
Xxxxxx,
Xxxxxx XX00
Bermuda
Attention: Secretary
Telephone: 000 000 0000
Fax: 000 000 0000
or to such other address (es) and telefax numbers as may from
time to time be notified by any Party to the others hereunder.
9.3.2 Any notice sent by mail shall be deemed to have been delivered within
seven (7) working days after dispatch or delivery to the relevant
courier and notice sent by fax shall be deemed to have been delivered
upon confirmation of receipt. Notice of change of address shall be
effective upon receipt.
9.4 Waiver:
20
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.
9.5 Severability:
If any provision in this Agreement is agreed by the Parties to be, or is
deemed to be, or becomes invalid, illegal, void or unenforceable under any
law that is applicable hereto:
9.5.1 such provision will be deemed amended to conform to applicable laws
so as to be valid and enforceable; or
9.5.2 if it cannot be so amended without materially altering the intention
of the Parties, it will be deleted, with effect from the date of this
Agreement or such earlier date as the Parties may agree, and the
validity, legality and enforceability of the remaining provisions of
this Agreement shall not be impaired or affected in any way.
9.6 Further Assurances:
At the request of any of the Parties, the other Party or Parties shall (and
shall use reasonable efforts to procure that any other necessary parties
shall) execute and perform all such documents, acts and things as may
reasonably be required subsequent to the signing of this Agreement for
assuring to or vesting in the requesting Party the full benefit of the
terms hereof.
9.7 Successors:
This Agreement shall be binding upon and inure to the benefit of the
Parties hereto and their respective successors and permitted assigns.
9.8 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 authorized
representative of each Party.
9.9 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.
21
9.10 Costs:
Each Party shall bear its own costs and expenses in connection with the
transactions contemplated by this Agreement.
9.11 Force Majeure:
No Party to this Agreement shall be liable for failure or delay in the
performance of any of its obligations hereunder if such failure or delay
results from Force Majeure, but any such failure or delay shall be remedied
by such Party as soon as practicable.
9.12 Relationship of the Parties:
The Parties are independent contractors under this Agreement. Nothing
herein contained shall be deemed to create or establish an employment,
agency, joint venture, or partnership relationship between the Parties or
any of their agents or employees, or any other legal arrangement that would
impose liability upon one Party for the act or failure to act of another
Party. No Party shall have any express or implied power to enter into any
contracts, commitments or negotiations or to incur any liabilities in the
name of, or on behalf of, another Party, or to bind another Party in any
respect whatsoever.
9.13 Entire agreement:
9.13.1 This Agreement (including the Schedules attached hereto) and the
Letter Agreements set forth all of the agreements and understandings
between the Parties with respect to the subject matter hereof. There
are no agreements or understandings with respect to the subject matter
hereof, either oral or written, between the Parties other than as set
forth in this Agreement.
9.13.2 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 the Parties unless specifically provided herein and only to
the extent so specified.
THE REMAINDER OF THIS PAGE
HAS BEEN INTENTIONALLY LEFT BLANK.
22
IN WITNESS WHEREOF the Parties have executed this Agreement.
SIGNED
BY: /s/ Xxxxx xxx Xxxxxxx/Xxxxxx Xxxxx
----------------------------------
for and on behalf of
Elan Corporation, plc
SIGNED
BY: /s/ Xxxxx xxx Xxxxxxx/Xxxxxx Xxxxx
----------------------------------
for and on behalf of
Elan Pharma International Limited
SIGNED
BY: /s/ XX Xxxxx
---------------------
for and on behalf of
Elan International Services, Ltd.
SIGNED
BY: /s/ Xxxxxxx X. Xxxxxxx
---------------------
for and on behalf of
Incara Development, Ltd.
Xxxxxxx X. Xxxxxxx
Executive Vice President
SIGNED
BY: /s/ Xxxxxxx X. Xxxxxx
---------------------
for and on behalf of
Incara Pharmaceuticals Corporation
Xxxxxxx X. Xxxxxx
President & CEO
23
SCHEDULE 1
INCARA DEVELOPMENT, LTD.
(a Development Stage Company)
BALANCE SHEETS
(expressed in U.S. dollars)
August 31, September 30,
2003 2002
------------------ -------------------
(Unaudited)
Assets
Current assets:
Cash and cash equivalents ............................................... $ 135 $ 240
------------------ -------------------
$ 135 $ 240
================== ===================
Liabilities, Redeemable Preferred Stock and Stockholders' Deficit
Current liabilities:
Accrued liabilities ..................................................... 2,038 10,000
Due to related parties .................................................. - 296,073
------------------ -------------------
Total current liabilities ............................................... 2,038 306,073
------------------ -------------------
Redeemable preferred stock, $1 par value; 6,000 shares authorized; 6,000
shares issued and outstanding ($7,494,000 contributed surplus)........... 7,500,000 7,500,000
Stockholders' Deficit:
Common stock, $1 par value; 6,000 shares authorized; 6000 shares
issued and outstanding .................................................. 6,000 6,000
Additional paid-in capital (contributed surplus)......................... 10,461,921 10,016,621
Accumulated deficit ..................................................... (17,969,824) (17,828,454)
------------------ -------------------
Total stockholders' deficit ............................................. (7,501,903) (7,805,833)
------------------ -------------------
$ 135 $ 240
================== ===================
24
SCHEDULE 3.5.2
Newco Third Party Agreements
1. Third party agreements to which Newco is a party
Codan Services Limited
PricewaterhouseCoopers
2. Third party agreements to which Elan is a party for the benefit of Newco.
None
3. Possible Third party agreements to which JVP is a party for the benefit of
Newco.
>> Xxxxxx Xxxxxxx - expired 9/26/2
>> Xxxxxx Xxxxx - terminated 7/7/3, last worked 11/17/2
>> Xxxxxx Xxxxxxxxxxxx, M.D. - expired 9/26/2
>> Xxxxx Xxxxxx, Ph.D. - expired 6/27/2
>> Western Institutional Review Board - no contract
>> Covance Central Laboratory Services - Terminated 9/25/2
>> Xxxx Xxxxxxx - expires 8/11/3
>> SAS Institute Inc. - expired 4/30/3
>> Xxxxxx Pharmaceutical Solutions, formerly Xxxxxx Healthcare Corporation -
terminated per Cancellation Plan dated 12/10/2
>> PPD Development, LLC - Completed in 2000
>> JMH Consulting - terminated verbally 9/1/2
>> Chrohn's & Colitis Foundation of America - no contract
>> Opocrin sPa - contract active
>> AGMG Clinical Research - terminated 9/18/2
>> XxxxxxxxXxxxxx.xxx, Inc. (3) - terminated 9/18/2
>> Atlanta Gastroenterology Assoc. - terminated 9/18/2
>> Xxxxxxx-Xxxxxxx Clinic - terminated 9/18/2
>> Cleveland Clinic Foundation - terminated 9/18/2
>> Community Clinical Trials - terminated 9/18/2
>> Duke University - terminated 9/18/2
>> Gant Research PA - terminated 9/18/2
>> Gastroenterology Clinic of San Antonio - terminated 9/18/2
>> Gastroenterology Specialities P.C. - terminated 9/18/2
>> Gastroenterology United of Tulsa - terminated 9/18/2
>> Xxxxxxx Xxxx, M.D., Long Island Clinical Research Associates - terminated
9/18/2
>> Medical College of Wisconsin - terminated 2/13/2
>> Miami Research Associates - terminated 9/18/2
>> Minnesota Clinical Research Center - terminated 9/18/2
>> Mount Sinai School of Medicine, Xxxxxx X. Present MD - terminated 9/18/2
25
>> Nashville Clinical Research - terminated 9/18/2
>> North Florida Foundation for Research & Education - terminated 9/18/2
>> Oklahoma Foundation for Digestive Research - terminated 9/18/2
>> Rocky Mountain Clinical Research, Inc. (2) - terminated 9/18/2
>> Xxxxxxx Xxxxx, M.D., Consultants for Clinical Research - terminated 9/18/2
>> Summit Research Solutions, PLLC - terminated 9/18/2
>> Tulane University Medical Center - terminated 2/13/2
>> University of Chicago - terminated 2/19/2
>> University of Kentucky Research Foundation - terminated 9/18/2
>> University of Miami - terminated 9/18/2
>> Regents of The University of Michigan - terminated 9/18/2
>> University of North Carolina - terminated 9/18/2
>> The Trustees of the University of Pennsylvania - terminated 9/18/2
>> University of Pittsburgh - terminated 4/10/2
>> The Xxxxxx and Visitors of the University of Virginia - terminated 9/18/2
>> Vanderbilt University - terminated 12/3/1
>> Wake Research Associates - terminated 9/18/2
>> Washington University - terminated 9/18/2
>> West Hills Gastroenterology - terminated 9/18/2
26
SCHEDULE 3.6
REGULATORY APPLICATIONS
United States IND 58,124: OP2000 (deligoparin) Injection (Ultra Low Molecular
Weight Heparin) for Ulcerative Colitis, inclusive of 37 amendments
Final report and request for termination of IND 58,124 was submitted to FDA on
January 31, 2003
27
Schedule 4.1.1
ELAN IMPROVEMENTS
1. Alternative device survey.
28
Schedule 4.1.2
JVP IMPROVEMENTS
United States IND 58,124: OP2000 (deligoparin) Injection (Ultra Low Molecular
Weight Heparin) for Ulcerative Colitis, inclusive of 37 amendments
Final report and request for termination of IND 58,124 was submitted to FDA on
January 31, 2003
29
Schedule 4.1.3
NEWCO INTELLECTUAL PROPERTY
1. Market research information relating to ulcertive colitis ("Marketing
Study")
30
SCHEDULE 5
RIGHTS RELATED TO THE SECURITIES;
Amendments to the Finance Documents
1. Development Funding
Section 1(e) ("Note Purchases") and Section 1(f) ("Second Closing") of the
Securities Purchase Agreement are hereby deleted in their entirety and are of no
further force or effect whatsoever as of the Effective Date.
Section 3 ("Reduction of Amounts Payable Hereunder") and Section 5(h) (certain
JDOA terminations as "Events of Default") of the Note are hereby deleted in
their entirety and are of no further force or effect whatsoever as of the
Effective Date.
2. Transfer Restrictions
The following provisions are hereby amended as follows, effective as of the
Effective Date:
Section 1(g) ("Exemption from Registration") of the Securities Purchase
Agreement is hereby amended by deleting the second legend in its entirety, which
is of no further force and effect.
Section 16 ("Assignments and Transfers") of the Securities Purchase Agreement is
hereby amended by (i) deleting the word "permitted" in the first sentence
thereof and adding the following to the end of the first sentence: "provided,
however, that the rights of EIS or any of its Affiliates under Section 5(b)
("Company Board of Directors") (1) shall not be assignable to a pharmaceutical
or biotechnology company engaged in a line of business similar to a line of
business then engaged in by the Company ("Technological Competitor") and (2)
shall not be assignable to any other person or entity which is not an Affiliate
of EIS without the prior written consent of the Company, which consent shall not
be unreasonably withheld or delayed", (ii) deleting the remainder of such
Section (as amended) in its entirety, and (iii) adding a new second sentence to
read as follows: "Notwithstanding the foregoing, the Company shall not assign
all or any part of this Agreement without the prior written consent of the other
parties.".
Section 17 ("Assignments and Transfers") of the Series B Securities Purchase
Agreement is hereby amended by (i) deleting the word "permitted" in the first
sentence thereof, (ii) deleting the second and third sentences thereof in their
entirety, and (iii) adding a new sentence at the end of Section 17 to read as
follows: "Notwithstanding the foregoing, the Company shall not assign all or any
part of this Agreement without the prior written consent of the other parties."
31
Section 10 ("Transfer of Registration Rights") of the JVP Registration Rights
Agreement is hereby deleted in its entirety and is of no further force and
effect.
Section 14(d) ("Successors and Assigns") of the JVP Registration Rights
Agreement is hereby amended by (i) deleting the word "permitted" in the first
sentence thereof and (ii) deleting the remainder of such Section in its
entirety.
The legend on the front page of the Warrant and in Section 5(a) thereof is
hereby amended to add the following to the end of subsection (i) thereof: "OR AN
EXEMPTION FROM REGISTRATION THEREUNDER".
Section 5(b)(i) of the Warrant is hereby deleted in its entirety and is of no
further force and effect.
Section 9(a) of the Note is hereby amended by (i) deleting the word "permitted"
in the first sentence thereof, (ii) deleting the second and third sentences
thereof in their entirety, and (iii) adding a new second sentence to read as
follows: "Notwithstanding the foregoing, the Company shall not assign or
transfer all or any part of this Note, or any interest therein, without the
prior written consent of the Holder".
JVP shall, if requested by the holder of securities for which legends are of no
effect pursuant to this Section 2 of Schedule 5, re-issue such securities
without such restrictive legend.
3. Pledge/Security Interest
Section 6 ("Pledge of Newco Shares") of the Securities Purchase Agreement is
hereby deleted in its entirety and is of no further force or effect whatsoever
as of the Effective Date. As soon as practicable after the Effective Date, EIS
shall deliver to Incara the shares of Newco held by or for EIS pursuant to
Section 6 of the Securities Purchase Agreement.
4. Covenants
Section 4 ("Restriction on Conversion of Certain Shares of Series B Preferred
Stock") of the Fourth Amendment is hereby deleted in its entirety and is of no
further force or effect whatsoever as of the Effective Date.
The January 7 Letter Agreement is hereby amended to provide that the
restrictions on conversion and transfer set forth therein with respect to Series
B Preferred Stock shall terminate with respect to any shares of Series B
Preferred Stock assigned or transferred to any person or entity other than a
subsidiary of Elan Corp, effective as of the date of such assignment or
transfer.
The Series B Securities Purchase Agreement is hereby amended to provide that the
provisions of Section 2(l) ("Waiver of Right to Vote Shares of Incara Stock")
shall
32
terminate with respect to any shares of Series B Preferred Stock assigned or
transferred to any person or entity other than a subsidiary of Elan Corp,
effective as of the date of such assignment or transfer.
5. Exchange Right
Section 5(c) ("Conversion and Exchange Rights") of the Securities Purchase
Agreement is hereby amended by deleting the second and third paragraphs in their
entirety, which are of no further force or effect whatsoever as of the Effective
Date.
Neither Elan Corp nor any of its Affiliates has any intention of acquiring
shares of Series C Preferred Stock, $.01 par value, of Incara Pharmaceuticals
Corporation ("Series C Preferred") from EPIL III. In the event that Elan Corp or
any such Affiliate nonetheless in the future acquires or otherwise obtains
ownership or control over such Series C Preferred, neither Elan Corp nor such
Affiliate will exercise the EIS Exchange Right (as defined in the Securities
Purchase Agreement) relating thereto.
6. Third Party Beneficiary
Each Party acknowledges and agrees that EPIL III shall be deemed in all respects
to be a third party beneficiary of the agreements contained in this Schedule
5.1, with the same force and effect as if EPIL III were a party thereto.
33
SCHEDULE 6
LETTER AGREEMENTS
[SIGNED COPIES WILL BE ATTACHED UPON EXECUTION OF TERMINATION AGREEMENT]
[ELAN LETTERHEAD]
June 6, 2003
Incara Development, Ltd.
Xxxxxxxxx Xxxxx,
0 Xxxxxx Xx.,
Xxxxxxxx,
Xxxxxxx
Xxxxxxxxx: Secretary
Incara Pharmaceuticals Corporation
79 XX Xxxxxxxxx Drive
4401 Research Commons
Xxxxx 000
X.X. Xxx 00000
Research Xxxxxxxx Xxxx, Xxxxx Xxxxxxxx 00000
Attention: Chief Executive Officer
RE: TERMINATION OF LICENSE AGREEMENT
Dear Sir or Madam:
This letter agreement ("Agreement") serves to confirm the agreement of the
parties below to terminate the License Agreement dated January 19, 2001 (the
"Elan License Agreement") among Elan Corporation, plc ("Elan"), Elan Pharma
International Ltd. ("EPIL") and Incara Development, Ltd. ("IDL"), which was
agreed to and accepted by Incara Pharmaceuticals Corporation ("Incara").
Capitalized terms used herein and not otherwise defined have the meanings set
forth in the Elan License Agreement.
Effective upon execution and delivery of this letter by all of the parties
hereto, the parties hereby confirm and agree that the Elan License Agreement is
deemed terminated as of the date first set forth above (the "Effective Date").
Accordingly, with effect from the Effective Date, all the provisions of the Elan
License Agreement, including those provisions expressly stated to survive
termination, with the exception of the confidentiality obligations set forth in
Clause 9, shall be deemed terminated and of no further force or effect.
34
For the avoidance of doubt and without prejudice to the generality of the
foregoing, the parties acknowledge and agree that, as of the Effective Date: (i)
all rights granted to IDL pursuant to the Elan License Agreement to use the Elan
Intellectual Property shall terminate forthwith, and (ii) neither Incara or its
Affiliates nor IDL shall have any rights in or to the Elan Intellectual
Property, the Elan Trademarks and/or any other patents, know-how or any other
intellectual property rights of Elan.
The parties further confirm that as of the Effective Date, there are no third
party sub-licensees in and to the Elan Intellectual Property.
IDL and Elan hereby relinquish all rights, title and interest in and to solely
that portion of Newco Intellectual Property arising from the Phase II/III
clinical trials conducted by Incara on behalf of IDL and relating solely to data
generated in respect of the compound, deligoparin, designated as OP 2000 (the
"Compound"), which Compound was licensed to Incara by Opocrin S.p.A. pursuant to
that certain License, Development, Marketing and Clinical Trials Supply
Agreement, dated 20 July 1998, by and between Opocrin S.p.A. and Intercardia,
Inc. (now known as Incara).
With effect from the Effective Date, Incara, IDL and each of their respective
Affiliates (collectively, "Releasor") hereby waives any accrued rights that
Releasor may have accrued against Elan and each of its Affiliates, officers,
directors, representatives, agents and employees and the assigns and successors
in interest of any of the foregoing entities ("Releasees"), whether known or
unknown, forseen or unforeseen, fixed or contingent, of any nature whatsoever
from the beginning of time to the effective date hereof and fully and finally
releases and discharges the Releasees from any and all manner of actions,
claims, promises, debts, sums of money, demands, obligations in law or in
equity, directly or indirectly, whether known or unknown, forseen or unforseen,
fixed or contingent, of any nature whatsoever that Releasor may have by reason
of any act, omission, matter, provision, cause or thing whatsoever from the
beginning of time to the effective date hereof.
Promptly following the Effective Date, the parties hereto will enter into good
faith negotiations to agree to a termination agreement in writing ("JDOA
Termination Agreement") to terminate that certain Subscription, Joint
Development and Operating Agreement, dated 19 January 2001 ("JDOA"), among Elan,
EPIL, Elan International Services Limited ("EIS"), Incara and IDL. Without
prejudice to the terms of this Agreement, the JDOA Termination Agreement shall
include provisions, on terms to be negotiated in good faith by the parties,
providing for the orderly termination of the JDOA, the Project, research and
development work and funding provided in connection therewith; the resignation
of various Elan and Incara representatives associated with committees or other
functions involved in IDL; the identification and ownership of intellectual
property rights; the waiver of accrued rights and a general release from each
party in favour of the other parties, as well as certain other matters relating
to the securities held by EIS in Incara.
35
Please indicate your acceptance of the provisions of this letter agreement by
signing and dating below and returning a signed copy to Elan, whereupon this
letter will become a binding agreement among us.
Sincerely,
ELAN CORPORATION, PLC ELAN PHARMA INTERNATIONAL LTD.
By: __________________________ By: _______________________________
Name: ________________________ Name: _____________________________
Title: _______________________ Title: ____________________________
Acknowledged and Agreed to By:
INCARA PHARMACEUTICALS INCARA DEVELOPMENT,
CORPORATION LTD.
By: By:
----------------------------- -------------------------------------
----------------------------- -------------------------------------
Name Name
----------------------------- -------------------------------------
Title Title
Date Date
cc: Xxxxx X. Xxxxxxx, Esq.
Xxxxxx Xxxxxxx Xxxxx Xxxxxx LLP
36
[INCARA LETTERHEAD]
June 6, 2003
Incara Development, Ltd
Xxxxxxxxx Xxxxx,
0 Xxxxxx Xx.,
Xxxxxxxx,
Xxxxxxx
Xxxxxxxxx: Secretary
Elan Corporation, plc
Xxxxxxx Xxxxx,
Xxxxxxx Xxxxx,
Xxxxxx 0,
Xxxxxxx
Attention: Vice President & General Counsel
RE: TERMINATION OF LICENSE AGREEMENT
Dear Sir or Madam:
This letter agreement ("Agreement") serves to confirm the agreement of the
parties below to terminate the License Agreement dated January 19, 2001 (the
"Incara License Agreement") between Incara Pharmaceuticals Corporation
("Incara") and Incara Development, Ltd. ("IDL"), which was agreed to and
accepted by Elan Corporation, plc ("Elan"). Capitalized terms used herein and
not otherwise defined have the meanings set forth in the Incara License
Agreement.
Effective upon execution and delivery of this letter by all of the parties
hereto, the parties hereby confirm and agree that the Incara License Agreement
is deemed terminated as of the date first set forth above (the "Effective
Date"). Accordingly, with effect from the Effective Date, all the provisions of
the Incara License Agreement, including those provisions expressly stated to
survive termination, with the exception of the confidentiality obligations set
forth in Clause 9, shall be deemed terminated and of no further force or effect.
For the avoidance of doubt and without prejudice to the generality of the
foregoing, the parties acknowledge and agree that, as of the Effective Date: (i)
all rights granted to IDL pursuant to the Incara License Agreement to use the
Incara Intellectual Property shall terminate forthwith, and (ii) neither Elan or
its Affiliates nor IDL shall have any rights in or to the Incara Intellectual
Property, the Incara Trademarks and/or any other patents, know-how or any other
intellectual property rights of Incara.
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IDL and Elan hereby relinquish all rights, title and interest in and to solely
that portion of Newco Intellectual Property arising from the Phase II/III
clinical trials conducted by Incara on behalf of IDL and relating solely to data
generated in respect of the compound, deligoparin, designated as OP 2000 (the
"Compound"), which Compound was licensed to Incara by Opocrin S.p.A. pursuant to
that certain License, Development, Marketing and Clinical Trials Supply
Agreement, dated 20 July 1998, by and between Opocrin S.p.A. and Intercardia,
Inc. (now known as Incara).
Promptly following the Effective Date, the parties hereto will enter into good
faith negotiations to agree to a termination agreement in writing ("JDOA
Termination Agreement") to terminate that certain Subscription, Joint
Development and Operating Agreement, dated 19 January 2001 ("JDOA"), among EPIL,
Elan International Services Limited ("EIS"), Incara and IDL. Without prejudice
to the terms of this Agreement, the JDOA Termination Agreement shall include
provisions, on terms to be negotiated in good faith by the parties, providing
for the orderly termination of the JDOA, the Project, research and development
work and funding provided in connection therewith; the resignation of various
Elan and Incara representatives associated with committees or other functions
involved in IDL; the identification and ownership of intellectual property
rights; the waiver of accrued rights and a general release from each party in
favour of the other parties, as well as certain other matters relating to the
securities held by EIS in Incara.
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Please indicate your acceptance of the provisions of this letter agreement by
signing and dating below and returning a signed copy to Incara, whereupon this
letter will become a binding agreement among us.
Sincerely,
INCARA PHARMACEUTICALS CORPORATION
By: __________________________
Name: ________________________
Title: _________________________
Acknowledged and Agreed to By:
ELAN CORPORATION, PLC INCARA DEVELOPMENT, LTD.
By: By:
-------------------------------- -----------------------------------
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Name Name
-------------------------------- -----------------------------------
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Title Title
Date Date
cc: Xxxxx X. Xxxxxxx, Esq.
Xxxxxx Xxxxxxx Xxxxx Xxxxxx LLP
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