Exhibit 5
RIGHT OF FIRST REFUSAL AGREEMENT
This RIGHT OF FIRST REFUSAL AGREEMENT is entered into as of the 7th day of
May, 1999 by and among SangStat Medical Corporation, a Delaware corporation
("SangStat"), and Xxxxxx Laboratories, an Illinois corporation ("Xxxxxx").
W I T N E S S E T H :
WHEREAS, SangStat and Xxxxxx are parties to the Stock Purchase Agreement of
even date herewith (the "Stock Purchase Agreement"), pursuant to which Xxxxxx is
purchasing those shares of SangStat's common stock $0.001 par value (the "Common
Stock") that are defined in the Stock Purchase Agreement as being the "Initial
Shares" and may purchase those shares of the Common Stock that are defined in
the Stock Purchase Agreement as being the "Option Shares" (the Initial Shares
and the Option Shares are referred to collectively herein as the "Shares"); and
WHEREAS, SangStat and Xxxxxx wish to provide further inducements to each
other to consummate the proposed transaction;
WHEREAS, all terms not otherwise defined herein shall have the same
meanings ascribed to them in the Stock Purchase Agreement;
NOW, THEREFORE, in consideration of the premises and the mutual promises
set forth in this Agreement;
THE PARTIES AGREE AS FOLLOWS:
1. RIGHT OF REFUSAL.
(A) TRANSFER NOTICE. If at any time after the expiration of the
Market Stand-Off set forth in the Stock Purchase Agreement, Xxxxxx proposes
to transfer any of the Shares to one or more third parties or in an open
market transaction (a "Transfer"), then Xxxxxx shall give SangStat written
notice of Xxxxxx'x intention to make the Transfer (the "Transfer Notice"),
which Transfer Notice shall include (i) a description of the Shares to be
transferred ("Offered Shares"), (ii) the identity of the prospective
transferee(s) if it is not an open market transaction and (iii) the
consideration and the material terms and conditions upon which the proposed
Transfer is to be made. The Transfer Notice shall also include a copy of any
written proposal, term sheet or letter of intent, or other agreement relating
to the proposed Transfer.
(B) SANGSTAT'S OPTION. SangStat shall have an option for a
period of thirty (30) days from receipt of the Transfer Notice to elect to
purchase the Offered Shares at the same price and subject to the same
material terms and conditions as described in the Transfer Notice or if the
Transfer Notice proposes an open market transaction, then the purchase price
for SangStat shall be the average of the closing prices for SangStat's Common
Stock, as quoted on the Nasdaq
National Market, on each of the twenty (20) trading days immediately
preceding the date of the Transfer Notice. SangStat may exercise such
purchase option and, thereby, purchase all of the Offered Shares if the
Transfer Notice proposes a transfer to one or more third parties not in an
open market transaction, or purchase all (or a portion of) the Offered Shares
if the Transfer Notice proposes an open market transaction by notifying
Xxxxxx in writing before expiration of the such thirty (30) day period as to
the number of such shares which it wishes to purchase. If SangStat gives
Xxxxxx notice that it desires to purchase such shares, then payment for the
Offered Shares shall be by check or wire transfer, against delivery of the
Offered Shares to be purchased at a place agreed upon between the parties and
at the time of the scheduled closing therefor, which shall be no later than
forty-five (45) days after SangStat's receipt of the Transfer Notice, unless
the Transfer Notice contemplated a later closing with the prospective third
party transferee(s) or unless the value of the purchase price has not yet
been established pursuant to Section 1.1(c).
(C) VALUATION OF PROPERTY. Should the purchase price specified
in the Transfer Notice be payable in property other than cash or evidences of
indebtedness, SangStat shall have the right to pay the purchase price in the
form of cash equal in amount to the value of such property. If Xxxxxx and
SangStat cannot agree on such cash value within ten (10) days after
SangStat's receipt of the Transfer Notice, the valuation shall be made by an
appraiser of recognized standing selected by Xxxxxx and SangStat or, if they
cannot agree on an appraiser within twenty (20) days after SangStat's receipt
of the Transfer Notice, each shall select an appraiser of recognized standing
and the two appraisers shall designate a third appraiser of recognized
standing, whose appraisal shall be determinative of such value. The cost of
such appraisal shall be shared equally by Xxxxxx and SangStat. If the time
for the closing of SangStat's purchase but for the determination of the value
of the purchase price offered by the prospective transferee(s), then such
closing shall held on or prior to the fifth business day after such valuation
shall have been made pursuant to this subsection.
1.2 NON-EXERCISE OF RIGHTS. To the extent that SangStat has not
exercised its right to purchase the Offered Shares within the time period
specified in Section 1.1, the rights set forth herein shall terminate.
1.3 LIMITATIONS TO RIGHT OF REFUSAL. Notwithstanding the provisions of
Section 1.1 and 1.2 of this Agreement, Xxxxxx may sell or otherwise assign,
with or without consideration, Shares to any affiliate or successor in
interest of Xxxxxx provided that each such transferee or assignee, prior to
the completion of the sale, transfer, or assignment shall have executed
documents assuming the obligations of Xxxxxx under this Agreement with
respect to the transferred securities.
2. ASSIGNMENTS AND TRANSFERS; NO THIRD PARTY BENEFICIARIES. This
Agreement and the rights and obligations of the parties hereunder shall inure
to the benefit of, and be binding upon, their respective successors, assigns
and legal representatives, but shall not otherwise be for the benefit of any
third party.
3. LEGEND. Each existing or replacement certificate for shares now owned
by Xxxxxx
shall bear the following legend upon its face:
"THE SALE, PLEDGE, HYPOTHECATION, ASSIGNMENT OR TRANSFER OF
THE SECURITIES REPRESENTED BY THIS CERTIFICATE IS SUBJECT TO
THE TERMS AND CONDITIONS OF A CERTAIN RIGHT OF FIRST REFUSAL
AGREEMENT BY AND BETWEEN THE STOCKHOLDER AND THE CORPORATION.
COPIES OF SUCH AGREEMENT MAY BE OBTAINED UPON WRITTEN REQUEST
TO THE SECRETARY OF THE CORPORATION."
4. TERM. This Agreement shall terminate upon the earlier of (i) December
31, 2004 and (ii) the closing of SangStat's sale of all or substantially all
of its assets or the acquisition of SangStat by another entity by means of
merger, consolidation or other transaction or series of related transactions
resulting in the exchange of the outstanding shares of SangStat's capital
stock such that the stockholders of SangStat prior to such transaction own,
directly or indirectly, less than 50% of the voting power of the surviving
entity.
5. MISCELLANEOUS.
5.1 ENTIRE AGREEMENT; CONTROLLING DOCUMENT. This Agreement constitutes
the entire agreement of the parties with respect to the subject matter hereof
and supersedes any and all prior negotiations, correspondence and
understandings between the parties with respect to the subject matter hereof,
whether oral or in writing.
5.2 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
5.3 DELAY AND WAIVER. No delay on the part of either party in exercising
any right under this Agreement shall operate as a waiver of such right. The
waiver by either party of any other term or condition of this Agreement shall
not be construed as a waiver of a subsequent breach or failure of the same
term or condition or a waiver of any other term or condition contained in
this Agreement.
5.4 ASSIGNMENT: SUCCESSORS AND ASSIGNS. No provision of this Agreement
may be assigned without the prior written consent of the other party hereto.
Except as otherwise provided herein, the terms and conditions of this
Agreement shall inure to the benefit of and be binding upon the respective
successors and assigns of the parties (including transferees of any of the
Initial Shares or Option Shares). Nothing in this Agreement, express or
implied, is intended to confer upon any party other than the parties hereto
or their respective successors and assigns any rights, remedies, obligations,
or liabilities under or by reason of this Agreement, except as expressly
provided in this Agreement.
5.5 GOVERNING LAW. This Agreement shall be governed by and construed
under the laws of the State of Delaware without regard to conflicts of law
principles.
5.6 TITLES AND SUBTITLES. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
5.7 EXPENSES. Irrespective of whether the Right of First Refusal is
exercised, each party shall pay all costs and expenses that it incurs with
respect to the negotiation, execution, delivery and performance of this
Agreement.
5.8 ALTERNATIVE DISPUTE RESOLUTION. The parties agree to effectuate all
reasonable efforts to resolve in an amicable manner any and all disputes
between them in connection with this Agreement. The parties agree that any
dispute that arises in connection with this Agreement, which cannot be
amicably resolved informally shall be finally settled as set forth in the
Alternative Dispute Resolution provisions of Exhibit E to the Co-Promotion
Agreement between Xxxxxx and SangStat dated as of May 7, 1999.
5.9 AMENDMENTS AND WAIVERS. Any term of this Agreement may be amended
and the observance of any term of this Agreement may be waived (either
generally or in a particular instance and either retroactively or
prospectively) only with the written consent of SangStat and Xxxxxx. Any
amendment or waiver effected in accordance with this paragraph shall be
binding upon each holder of any securities purchased under this Agreement at
the time outstanding (including securities into which such securities are
convertible), each future holder of all such securities and SangStat.
5.10 SEVERABILITY. If one or more provisions of this Agreement are held
to be unenforceable under applicable law, such provision shall be excluded
from this Agreement and the balance of the Agreement shall be interpreted as
if such provision were so excluded and shall be enforceable in accordance
with its terms.
5.11 FURTHER ASSURANCES. SangStat and Xxxxxx shall do and perform or
cause to be performed all such further acts and things and shall execute and
deliver all such other agreements, certificates, instruments or documents as
the other party may reasonably request from time to time in order to carry
out the intent and purposes of this Agreement and the consummation of the
transactions contemplated by the Agreement. Neither SangStat nor Xxxxxx shall
voluntarily undertake any course of action inconsistent with the satisfaction
of the requirements applicable to them as set forth in this Agreement, and
each shall promptly do all such acts and take all such measures as may be
appropriate to enable them to perform as early as practicable their
obligations under this Agreement.
5.12 NO THIRD PARTY RIGHTS. Nothing in this Agreement shall create or be
deemed to create any rights in any person or entity not a party to his
Agreement.
5.13 MUTUAL DRAFTING. This Agreement is the joint product of SangStat
and Xxxxxx and each provision of the Agreement has been subject to
consultation, negotiation and agreement of SangStat and Xxxxxx and their
respective legal counsel and advisers and any rule of construction that a
document shall be interpreted or construed against the drafting party shall
not apply.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first written above.
SANGSTAT MEDICAL CORPORATION
By: _______________________________________
President and Chief Executive Officer
Address: 0000 Xxxxx Xxxxx
Xxxxx Xxxx, XX 00000
XXXXXX LABORATORIES
By:
Name:
Title:
Address:
