AGREEMENT
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This Agreement (the " Agreement") is entered into and effective as of
the day of November 30, 2007 (the "Effective Date"), by and between SYNOVICS
PHARMACEUTICALS, INC., a Nevada corporation ("SYNOVICS") and XXXX X. XXXXXXX
("XXXXXXX").
PRELIMINARY STATEMENTS
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A. On or about May 21, 2007, SYNOVICS executed that certain Second
Amended and Restated Business Promissory Note (the "Note") in favor of XXXXXXX,
dated as of May 20, 2006, in the original principal amount of Three Million
($3,000,000.00) Dollars, a copy of which is attached hereto and made a part
hereof as Exhibit A, pursuant to which SYNOVICS was obligated to make, among
other payments, an interest payment, in the amount of Two Hundred Fifty-Eight
Thousand Forty-One and 51/100 ($258,041.51) Dollars, on October 3, 2007, which
amount was not paid by it.
B. The parties desire to comprise and amicably resolve their issues
with respect to SYNOVICS' payment obligations under the Note to XXXXXXX, in
accordance with the terms and conditions of this Agreement.
NOW, THEREFORE, for and in consideration of the amount set forth in this
Agreement, XXXXXXX' refraining from pursuing his remedies at this time, the
mutual covenants herein contained and other good and valuable consideration, the
receipt and adequacy of which are forever acknowledged and confessed, the
parties agree as follows:
AGREEMENT
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1. The above recitals are true and correct.
2. DEFINITIONS. The following defined terms shall have the meaning
stated:
2.1. The term "SYNOVICS" means SYNOVICS PHARMACEUTICALS, INC.
acting: (i) on its own behalf; and (ii) on behalf of directors, officers,
employees, successors, insurers, attorneys, lenders, creditors, shareholders,
agents, assigns, parent corporations, sister corporations, affiliate
corporations, subsidiaries and all other persons, natural or corporate, in
privity with SYNOVICS.
2.2. The term "XXXXXXX" means XXXX X. XXXXXXX, acting: (i) on
his own behalf; and (ii) on behalf his heirs, beneficiaries, estate, executors,
legatees, representatives, successors and assigns.
3. PAYMENTS. SYNOVICS shall pay XXXXXXX Two Million Two Hundred
Fifty-Eight Thousand Forty-One and 51/100 ($2,258,041.51) Dollars, which amount
represents principal in the amount of Two Million ($2,000,000.00) Dollars and
accrued interest, in the amount of Two Hundred Fifty-Eight Thousand Forty-One
and 51/100 ($258,041.51) Dollars, on or before August 1, 2008 (the "Maturity
Date"), together with interest, at the rate of Twelve (12%) Percent per annum,
from and after October 3, 2007, as follows:
3.1. Interest payment in the amount of Eighty-Four Thousand
Two Hundred Seventy-Two and 57/100 ($84,272.57) Dollars shall be payable on or
before November 16, 2007.
3.2. Interest payment in the amount of Sixty-One Thousand
Seven Hundred Sixty-Three and 94/100 ($61,763.94) Dollars shall be payable on or
before November 30, 2007.
3.3 Interest payment in the amount of Fifty-Six Thousand
Five Hundred Sixty-Seven and 35/100 ($56,567.35) Dollars shall be payable on or
before December 7, 2007.
3.4 Interest payment in the amount of Fifty-Six Thousand
Four Hundred Forty-Eight and 58/1 00 ($56,448.58) Dollars shall be payable on or
before December 14, 2007.
3.5 Interest payment in the amount of Fifty-Six Thousand
Three Hundred and Twenty-Nine and 81/100 ($56,329.81) Dollars shall be payable
on or before December 21, 2007.
After the December 21, 2007 payment, and presuming timely compliance with
the foregoing payment terms, the principal and interest then due and owing by
SYNOVICS to XXXXXXX will be Two Million ($2,000,000.00) Dollars, plus interest,
which amount shall be payable as follows:
3.6 Principal payment in the amount of One Million Five
Hundred Thousand ($1,500,000.00) Dollars, together with all accrued and unpaid
interest, at the rate of twelve (12%) percent per annum, on or before January
15, 2008.
After the January 15, 2008 payment, and presuming timely compliance with
the foregoing payment terms, the principal and interest then due and owing by
SYNOVICS to XXXXXXX will be Five Hundred Thousand ($500,000.00) Dollars, plus
interest, which amounts shall be payable as follows:
3.7 Interest payment in the amount of Five Thousand
Ninety-Five and 78/1 00 ($5,095.78) Dollars, on or before February 15, 2008.
3.8 Interest payment in the amount of Four Thousand Seven
Hundred Sixty-Seven and 02/100 ($4,767.02) Dollars, on or before March 15, 2008.
3.9 Interest payment in the amount of Five Thousand
Ninety-Five and 78/100 ($5,095.78) Dollars, on or before April 15, 2008.
3.10 Interest payment in the amount of Four Thousand Nine
Hundred Thirty-One and 40/100 ($4,931.40) Dollars, on or before May 15, 2008.
3.11 Interest payment in the amount of Five Thousand
Ninety-Five and 78/1 00 ($5,095.78) Dollars, on or before June 15, 2008.
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3.12 Interest payment in the amount of Four Thousand Nine
Hundred Thirty- One and 40/100 ($4,931.40) Dollars, on or before July 15, 2008.
3.13 Principal in the amount of Five Hundred Thousand
($500,000.00) Dollars, together with all accrued and unpaid interest, at the
rate of twelve (12%) percent per annum, on or before August 1, 2008.
3.14 Principal amounts outstanding under this Note may
otherwise be prepaid at any time at the option of SYNOVICS, in whole or in part,
without premium or penalty.
3.15 There shall not be any grace period, whatsoever, with
respect to any payments due under this Agreement. SYNOVICS specifically
acknowledges that time is of the essence in this Agreement. The payments to be
made by SYNOVICS, pursuant to Sections 3.1 through 3.13 above, shall be made by
wire transfer to XXXXXXX, pursuant to wiring instructions provided by XXXXXXX or
his attorney to SYNOVICS prior to the aforesaid payment dates.
4. JUDGMENT. In the event SYNOVICS fails to abide by the terms and
conditions of this Agreement and not remit any payment timely when due, then
SYNOVICS will be considered to be in default from the time the stipulated
payment became due.
4.1 XXXXXXX shall then proceed with litigation by filing a
Complaint in the Circuit Court in Broward County, Florida, without further
notice and/or conditions precedent. Once a Complaint is filed by XXXXXXX and
SYNOVICS is served with the lawsuit, SYNOVICS waives any and all defenses to
such action and agrees to a Final Judgment, without necessity of a further
hearing, for the sum of Two Million Two Hundred Fifty-Eight Thousand Forty-One
and 51/100 ($2,258,041.51) Dollars, plus all accrued and unpaid interest at the
rate of Twelve (12%) Percent per annum, as of the date of such judgment, which
amount shall be stipulated in such judgment, less those payments previously made
by SYNOVICS to XXXXXXX, pursuant to paragraph 3 above, plus additional interest,
at the rate of Eighteen (18%) percent per annum, from and after the date of
default, and for execution to issue forthwith.
4.2 XXXXXXX and SYNOVICS expressly waive both their rights
to a trial by jury.
4.3 Once full payment is made by SYNOVICS and received by
XXXXXXX, XXXXXXX will provide SYNOVICS with a Satisfaction of Payment and/or
Release. If an action was filed in Court, XXXXXXX will file a Voluntary
Dismissal With Prejudice with the Court where the action was filed once full
payment is received.
5. BANKRUPTCY. SYNOVICS further acknowledges and agrees that in the
event of the filing of a voluntary or involuntary bankruptcy, whether under
Chapter 7, Chapter 11, or otherwise, under the Federal Bankruptcy Code,
involving SYNOVICS, prior to the date on which SYNOVICS has fully satisfied its
payment obligations, pursuant to paragraph 3 above, it shall specifically
request of the bankruptcy court, that its debt to XXXXXXX, in the amount of the
remaining monies due and owing by it, pursuant to paragraph 3 above, not
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be discharged in bankruptcy and that such debt to XXXXXXX shall survive such
bankruptcy filing, together with the discharge of same.
6. SEVERABILITY. In the event any provision of this Agreement is
held to be unenforceable, void, or invalid for any reason, the unenforceability
or invalidity thereof shall not affect the remainder of this Agreement, which
shall remain in full force and effect and enforceable in accordance with its
terms.
7. CONSTRUCTION AND INTERPRETATION. When the context requires, the
gender of all words shall include the masculine, feminine, and neuter, and the
number of all words shall include the singular and plural. The paragraphs and
other headings contained in this Agreement are for reference purposes only and
shall not affect in any way the meaning or interpretation of this Agreement.
This Agreement shall be construed without regard to any presumption or other
rule requiring construction against the party causing this Agreement to be
drafted.
8. WAIVER. All waivers to be effective shall be in writing and
signed by the waiving party. One or more waivers of a breach of any provision of
this Agreement shall not be construed as a waiver of a subsequent breach of the
same or any other provision, nor shall any delay or omission by a non-defaulting
party to seek a remedy for any breach of this Agreement or otherwise to exercise
the rights accruing to a non-defaulting party by reason of such breach be deemed
a waiver by a non-defaulting party of its remedies and rights with respect to
such breach.
9. AMENDMENT AND MODIFICATION. No amendment or modification of the
terms of this Agreement shall be binding unless reduced to writing and signed by
each of the parties hereof.
10. ENTIRE AGREEMENT. This Agreement contains the entire Agreement
by and between the parties and supersedes any and all previous discussions or
agreements, written or oral, by and between the parties relating to the subject
matter of this Agreement.
11. JURISDICTION: VENUE: INCONVENIENT FORUM. Any suit, action or
proceeding with respect to this Agreement, or any judgment entered by any court
in respect to this Agreement shall be brought exclusively in the courts of the
State of Florida located in Broward County, Florida to the exclusion of any
other Court and the parties accept the exclusive personal jurisdiction of those
courts for the purpose of any suit, action or proceeding. In addition, the
parties knowingly, intentionally and irrevocably waive, to the fullest extent
permitted by law, any objection which they may now or later have to the laying
of venue of any suit, action or proceeding arising out of or relating to this
Agreement, or any judgment entered by any court brought in the State of Florida,
located in Broward County, and further, knowingly, intentionally and irrevocably
waive any claim that any suit, action or proceeding brought in the State of
Florida located in Broward County has been brought in any inconvenient forum.
12. BENEFIT. All of the terms and provisions of this Agreement shall
be binding upon, inure to the benefit of, and be enforceable by the parties
hereto and their respective administrators, executives, legal representatives,
heirs, successors and permitted assigns.
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13. COUNTERPARTS. This Agreement may be executed in multiple
counterparts, each of which shall be deemed to be an original and all of which
together shall be deemed to be one and the same instrument.
14. GOVERNING LAW. This Agreement has been executed and delivered
and shall be construed and enforced in accordance with the laws of the State of
Florida, without regard to Florida's conflicts of laws principles.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the date first written above.
XXXXXXX:
/s/ Xxxx X. Xxxxxxx
-----------------------------------------
Xxxx X. Xxxxxxx
SYNOVICS PHARMACEUTICALS, INC., a Nevada corporation:
By: /s/ Xxxxxx Xxxxxx Lane
---------------------------------------------
Xxxxxx Xxxxxx Xxxx, PhD, Chairman and CEO
[NOTARIZATION PAGE FOLLOWS]
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EXHIBIT A
SECOND AMENDED AND RESTATED BUSINESS PROMISSORY NOTE, DATED AS
--------------------------------------------------------------
OF MAY 20, 2006
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(COPY ATTACHED)
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$3,000,000.00 As of May 20, 2006
SECOND AMENDED AND RESTATED BUSINESS PROMISSORY NOTE
FOR VALUE RECEIVED, Synovics Pharmaceuticals, Inc., a Nevada corporation
("Borrower"), promises to pay to the order of Xxxx X. Xxxxxxx ("Lender"), Three
Million Dollars ($3,000,000 00), with interest, as provided herein.
1. PRINCIPAL AND INTEREST PAYMENTS. The principal amount of this Note,
plus all accrued and unpaid interest, shall be due and payable as follows:
As of July 5, 2007, the total amount owing by Borrower to Lender shall
be Three Million Two Hundred Fifty-Three Thousand Three Hundred Fifty-Six and
16/100 ($3,253,356.16) Dollars, representing principal, in the amount of Three
Million ($3,000,000.00) Dollars and accrued interest, in the amount of Two
Hundred Fifty-Three Thousand Three Hundred Fifty-Six and 16/100 ($253,356.16)
Dollars. On July 5, 2007, Borrower shall pay Lender the sum of One Million
($1,000,000.00) Dollars, thereby reducing the principal and interest then due
and owing by Borrower to Lender to Two Million Two Hundred Fifty-Three Thousand
Three Hundred Fifty-Six and 16/100 ($2,253,356.16) Dollars. The foregoing
accrued interest, in the amount of Two Hundred Fifty-Three Thousand Three
Hundred Fifty-Six and 16/100 ($253,356.16) Dollars, plus additional interest
accrued thereon, at the rate of Seven and One-Half (7 1/2%) Percent per annum,
in the amount of Four Thousand Six Hundred Eighty-Five and 35/100 ($4,685.35)
Dollars, for total accrued interest owing in the amount of Two Hundred
Fifty-Eight Thousand and Forty-One and 51/100 ($258,041.51) Dollars shall be due
and payable by Borrower to Lender on October 3, 2007.
Thereafter, Borrower shall make a principal payment to Lender on the
second (2nd) anniversary date of this Note, May 20, 2008, in the amount of One
Million ($1,000,000.00) Dollars, together with all accrued and unpaid interest
to such date. Borrower shall make a final principal payment to Lender on the
third (3rd) anniversary date of this Note, May 20, 2009, in the amount of One
Million ($1,000,000.00) Dollars, together with all accrued and unpaid interest
to such date.
Principal amounts outstanding under this Note may otherwise be prepaid
at any time at the option of Borrower, in whole or in part, without premium or
penalty.
Borrower and Lender acknowledge and agree that the portion of the
purchase price paid by Borrower to Lender for Lender's membership units of Xxxx
included Xxxx'x debt to Lender for deferred compensation owed by Xxxx to Lender
and that that deferred compensation will be paid by Borrower to Lender as a part
of the principal payment due under this Note on May 20, 2009.
2. INTEREST PAYMENTS. This Note shall bear interest on the unpaid
principal balance from the date hereof at the rate of seven and one half percent
(7 1/2%) per annum, payable as set forth in paragraph 1 hereof.
3. OPTIONS TO CONVERT TO COMMON STOCK. Lender shall have the option to
convert any payment of principal and/or interest then due and owing to him,
consistent with the provisions contained in paragraph 1 above, into Borrower's
common stock, through a private
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placement, on the dates such principal and/or interest payments are due and
payable (the "Payment Date"), at the Conversion Price which is defined as the
lesser of: (a) Two Dollars and Forty Cents ($2.40), relative to the payment date
of May 20, 2007; Three Dollars Forty Cents ($3.40), relative to the payment date
of May 20, 2008; and Four Dollars Forty Cents ($4.40), relative to the payment
date of May 20, 2009; or (b) the price that is eighty (80%) percent of the
trailing thirty (30) day average trading price of the common stock of Borrower
for the thirty (30) days prior to the relevant Payment Date. In the event the
Payment Date is neither May 20, 2007, May 20, 2008, nor May 20, 2009, the
Conversion Price set forth in (a) above shall not be applicable but, rather, the
Conversion Price shall be determined pursuant to (b) above. However, in no event
shall the Conversion Price be less than Two Dollars ($2.00) per share.
In order for Lender to exercise any option, consistent with the
foregoing, he shall provide written notice of same to the Chief Executive
Officer of Borrower, to Borrower's office at 0000 Xxxx Xxxxxxxxx Xxxx, Xxxxx
000, Xxxxxxx, Xxxxxxx 00000, confirmed by facsimile to 000-000-0000 and to the
Broward County, Florida address at 0000 XX 00xx Xxxxxx, Xxxx Xxxxxxxxxx, Xxxxxxx
00000 (the "Option Notice") at least fifteen (15) days prior to the applicable
Payment Date.
Lender shall be able to exercise his options consistent with the
foregoing, in whole or in part, meaning that Lender's failure to exercise one
(1) or more options provided hereunder shall not preclude him from exercising
subsequent options, relative to subsequent principal and/or interest payments
due and owing pursuant to this Note. However, absent any exercise by Lender of
his options, consistent with the foregoing, the payment provisions contained in
paragraph 1 shall apply and be controlling.
4. METHOD OF PAYMENT. All payments of principal and interest shall be
made by the transfer of immediately available funds to such account as Lender
shall designate from time to time. If any payment date shall fall on a day other
than a business day, the payment due on such date shall he payable on the next
succeeding business day or any.
5. DEFAULT. If Borrower shall fail to make a payment of principal or
interest when due or to comply with any of the other terms, provisions and
conditions of this Note, and such failure to pay or perform shall continue for a
period of thirty (30) business days following written notice from Lender, a
default shall be deemed to have occurred under this Note and Lender shall have
the right to pursue all remedies available to him. Notwithstanding the
foregoing, with regard to the first (1st) principal payment due, in the amount
of One Million ($1,000,000.00) Dollars, on July 5, 2007, together with the
interest payment, in the amount of Two Hundred Fifty-Eight Thousand and
Forty-One and 51/100 ($258,041.51) Dollars, due on October 3, 2007, if Borrower
shall fail to make either payment when due, a default shall be deemed to have
occurred under this Note without the requirement of Lender providing written
notice of such default to Borrower and without providing Borrower with an
opportunity to cure such default. If at any time Lender incurs costs in respect
of the collection of indebtedness hereunder, including attorneys' fees and
expenses, Lender shall be entitled to immediate reimbursement from the Borrower
for all such costs incurred (or at his option elect to add such amounts to the
principal balance of the indebtedness). After maturity or default, this Note
shall bear interest at the rate of eighteen percent (18%) per annum.
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6. ACCELERATION. Lender shall have the right, at any time, to accelerate
and have the principal balance then owing pursuant to this Note, plus interest
accrued thereon, become immediately due and payable upon written notice to
Borrower, in the event Xxxxxx X. Xxxx resigns or is removed from his position as
a member of the Board of Directors of Xxxx Pharmaceuticals, Inc. ("Xxxx") or
ceases to act, for any reason whatsoever, as a member of the Board of Directors
of Xxxx.
7. GOVERNING LAW. This Note shall he governed by and construed in
accordance with the laws of the State of Florida excluding the conflict or
choice of law principles thereof, and any suit brought in connection with the
enforcement or interpretation of this Note may be brought in the courts of the
State of Florida or the federal courts in Florida Borrower hereby irrevocably
submits to the non-exclusive jurisdiction of such courts
8. MISCELLANEOUS. Presentment, notices of dishonor and demand, protest
and diligence in collection and bringing suit are hereby severally waived by the
Borrower. No waiver of any default or failure or delay to exercise any right or
remedy by the holders of this Note shall operate as a waiver of any right or
remedy with respect to the same or any other occurrences. This written Note
represents the final agreement between the parties and may not be contradicted
by evidence of prior, contemporaneous, or subsequent, oral agreements of the
parties. There are no unwritten oral agreements between the parties.
9. WAIVER OF JURY TRIAL. IN ANY COURT ACTION RELATING TO THIS NOTE, EACH
OF BORROWER AND LENDER WAIVES ANY RIGHT TO TRIAL BY JURY
[Signature Page to Follow]
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IN WITNESS WHEREOF, Borrower has caused this Note to be executed by its
duly authorized officers.
SYNOVICS PHARMACEUTICALS, INC
Attest:
By: /s/ Xxxxxx X. Xxxx
--------------------------------
Xxxxxx Xxxxxx Xxxx, PhD
/s/ Xxxxxx X. Xxxx Chairman, CEO and President
----------------------------
Secretary
NOTICE
THIS NOTE HAS NOT BEEN REGISTERED PURSUANT TO THE SECURITIES ACT OF 1933, AS
AMENDED, OR UNDER THE SECURITIES LAWS OF ANY STATE. THIS NOTE MAY NOT BE OFFERED
OR SOLD UNLESS IT IS REGISTERED UNDER THE APPLICABLE SECURITIES LAWS OR UNLESS
AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE.
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