EXHIBIT 10.35
*** TEXT OMITTED AND FILED SEPARATELY
CONFIDENTIAL TREATMENT REQUESTED
UNDER 17 C.F.R. SECTIONS 200.80 (B)(4),
200.83 AND 240.24b-2
NOTE PURCHASE AGREEMENT
NOTE PURCHASE AGREEMENT (the "Agreement"), dated as of August
14, 2001, between SHEFFIELD PHARMACEUTICALS, INC., a Delaware corporation (the
"Company"), and ELAN PHARMA INTERNATIONAL LIMITED, an Irish limited company
("EPIL").
R E C I T A L :
The parties hereto (or in the case of EPIL, one of its
affiliates), are parties to a Securities Purchase Agreement dated as of October
15, 1999 (as amended at any time, the "Purchase Agreement"), pursuant to which,
among other things, the Company issued and sold to EPIL and EPIL acquired from
the Company certain securities. The parties desire that, in accordance with the
provisions hereof, the Company will issue to EPIL and EPIL will acquire from the
Company, a promissory note (as amended at any time, the "Note"), in the original
principal amount of $4 million, of which $2 million shall be funded on the date
hereof and up to the remaining $2 million may be funded in accordance with the
terms hereof and thereof (references herein to "dollars" or "$" refer to United
States dollars and capitalized terms not defined herein have the meanings
ascribed to them in the Purchase Agreement).
A G R E E M E N T :
The parties agree as follows:
SECTION 1. Closings. (a) Time and Place. The closing of the transactions
contemplated hereby (the "Closing") shall occur as of the date hereof at the
offices of New York counsel of EPIL or at such other place as the parties may
agree.
(b) Issuance of Note; Etc. At the Closing, the Company and EPIL shall
execute and deliver to EPIL the Note and EPIL shall fund to an account
designated by the Company $2 million, which is the initial principal amount
provided to be funded hereunder. In the event that (x) the company shall have
failed [text omitted] on or propr to the date that is 60 days after the date
hereof, and (y) there shall be no default or breach by the Company hereunder,
under the Note or under the Purchase Agreement or other Transaction Documents
and all of the Company's representations herein and therein shall be true and
accurate, then, in such events, the Company shall have the right to request
from EPIL (which request shall be in writing within 15 days of the expiration
of the 60-day period referred to in clause (x) above, and which writing shall
confirm the conditions described in clauses (x) and (y) above) that up to an
additional $2 million principal amount be funded thereunder (the "Second
Funding"), which EPIL shall have the right, in its sole discretion, to elect to
fund, to fund in part (up to the requested amount) or not to fund. In the
event that EPIL elects to fund all or a portion of the Second Funding, the
parties shall thereafter agree on a time and place for such funding and the
amount thereof (up to $2 million), EPIL shall fund such amount on such date and
an appropriate written notation in respect thereof shall be made by EPIL on the
reverse of the Note. There shall be only one funding of the Second Funding and
if the entire $2 million is not funded, such unfunded portion shall not be
subsequently funded.
(c) Exemption from Registration. The Note will be issued under an exemption
or exemptions from registration under the Securities Act of 1933, as amended
(the "Securities Act"); accordingly, the Note shall, upon issuance, contain the
following legend:
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"), AND MAY NOT UNDER ANY CIRCUMSTANCES BE TRANSFERRED
WITHOUT AN EFFECTIVE REGISTRATION STATEMENT FOR THIS NOTE UNDER THE ACT
OF AND ANY APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL
REASOANABLY SATISFACTORY TO THE CORPORATION THAT REGISTRATION IS NOT
REQUIRED UNDER SUCH ACT OR APPLICABLE STATE SECURITIES LAWS.
SECTION 2. (a) Representations of the Company. Except for representations
made as of a specified date not amended hereby, and except as set forth on
Schedule 2(a) hereto, the Company incorporates herein and restates, mutatis
mutandis, each of the representations made by the Company and set forth in
Section 2 of the Purchase Agreement, except that the dates in Sections 2(f) and
2(g) are amended from "December 31, 1998" and "June 30, 1999" to "December 31,
2000" and "June 30, 2001," respectively. In addition, Sections 2(c), 2(d) and
2(e) are amended to include the Note within the definitions of Securities and
Transaction Documents, as used therein.
(b) Representations of EPIL. Except as set forth on Schedule 2(b) hereto,
EPIL incorporates herein and restates, mutatis mutandis, each of the
representations made by EPIL and set forth in Section 3 of the Purchase
Agreement, as if EPIL were the party making such representations.
(c) The representations of the parties hereunder shall survive for a period
of 15 months following the date hereof or, if the Second Funding shall have
occurred, 15 months following the Second Funding.
SECTION 3. Covenants. (a) Use of Proceeds. The Company shall use the
disbursements under the Note for general corporate purposes.
(b) Further Assurances. From and after the date hereof, each of the parties
hereto agree to do or cause to be done such further acts and things and deliver
or cause to be delivered to each other such additional assignments, agreements,
powers and instruments, as
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each may reasonably require or deem advisable to carry into effect the purposes
of this Agreement and the Note.
(c) Non-disclosure. From and after the date hereof, neither the Company nor
EPIL shall disclose to any person or entity (other than its directors, officers
and agents who need to know such information in connection with the transactions
described herein and the Note, each of whom shall be informed of this
confidentiality provision and in respect of whose breaches the Company shall be
responsible) the content of this Agreement and the Note or the substance of the
transactions described herein, without the prior written consent of the other
party (which consent shall not be unreasonably withheld or delayed), except to
the extent required by applicable laws, regulations or administrative or
judicial processes in respect of press releases, periodic reports or other
public disclosure prepared in good faith by the Company or EPIL; provided, that
EPIL and the Company shall each provide the other with a reasonable opportunity
to review such releases or reports prior to release. This Section 3(c) shall not
be construed to prohibit disclosure of any information which has not been
previously determined to be confidential by EPIL or the Company, or which shall
have become publicly disclosed (other than by breach obligations of the Company
or EPIL hereunder).
SECTION 4. Notices. All notices, demands and requests of any kind to be
delivered to any party in connection with this Agreement shall be in writing and
shall be deemed to have been duly given if personally or hand delivered or if
sent by an internationally-recognized overnight courier or by registered or
certified airmail, return receipt requested and postage prepaid, or by facsimile
transmission addressed as follows:
(i) if to the Company, to:
Sheffield Pharmaceuticals, Inc.
South Xxxxxx Court
0000 Xxxxxx Xxxx Xxxxx
Xxxxx 000
Xxxxxxxxx, Xxx Xxxx 00000
Attention: Chairman
Facsimile: 000-000-0000
and
Sheffield Pharmaceuticals, Inc.
0000 Xxxxx Xxxxx Xxxxx Xxxx, Xxxxx 000
Xx. Xxxxx, Xxxxxxxx 00000-0000
Attention: Chief Executive Officer
Facsimile: 000-000-0000
with a copy to:
XxXxxxxxx Will & Xxxxx
00 Xxxxx Xxxxxx
0
Xxxxxx, Xxxxxxxxxxxxx 00000-0000
Attention: Xxxxxx Xxxxxx
Facsimile: 617-535-3800
(ii) if to EPIL, to:
Elan Pharma International Limited
Wil House
Xxxxxxx Business Xxxx
Xxxxxxx, Co. Xxxxx
Ireland
Facsimile: 000-00-000000
with a copy to:
Reitler Xxxxx LLC
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxxxx
Facsimile: 000-000-0000
or to such other address as the party to whom notice is to be given may have
furnished to the other party hereto in writing in accordance with provisions of
this Section 4. Any such notice or communication shall be deemed to have been
effectively given (i) in the case of personal or hand delivery, on the date of
such delivery, (ii) in the case of an internationally-recognized overnight
delivery courier, on the second business day after the date when sent, (iii) in
the case of mailing, on the fifth business day following that day on which the
piece of mail containing such communication is posted, and (iv) in the case of
facsimile transmission, the date of telephone confirmation of receipt. Notice
hereunder may be given on behalf of the parties by their respective attorneys.
SECTION 5. Amendments. This Agreement may not be modified or amended, or
any of the provisions hereof waived, except by written agreement of the Company
and EPIL.
SECTION 6. Counterparts and Facsimile. This Agreement may be executed in
any number of counterparts, and each such counterpart hereof shall be deemed to
be an original instrument, but all such counterparts together shall constitute
one agreement. Each of this Agreement and the Note may be signed and delivered
to the other party by facsimile transmission; such transmission shall be deemed
a valid signature.
SECTION 7. Headings. The section and paragraph headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of the Agreement.
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SECTION 8. Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York, without giving effect to
the principles thereof relating to conflicts of laws.
SECTION 9. Expenses. Each of the parties shall be responsible for its own
costs and expenses incurred in connection with the transactions contemplated
hereby.
SECTION 10. Assignments. This Agreement and all of the provisions hereof
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns. This Agreement and the Note may be
transferred by EPIL to affiliates and subsidiaries and to special purpose
financing and similar vehicles, in each case, without restriction (so long as
EPIL acts as agent or nominee for determinations hereunder); provided, however,
that EPIL shall remain liable for its obligations hereunder after any such
assignment. Other than as set forth above, no party shall transfer or assign
this Agreement or the Note or any interest therein without the prior written
consent of the other party.
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IN WITNESS WHEREOF, each of the undersigned has duly executed
this Agreement as of the date first written above.
SHEFFIELD PHARMACEUTICALS, INC.
By: /s/ Xxxxx X. Xxxxxxxx
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Name: Xxxxx X. Xxxxxxxx
Title: President & Chief Executive Officer
ELAN PHARMA INTERNATIONAL LIMITED
By: /s/ Xxxxx Xxxxxx
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Name: Xxxxx Xxxxxx
Title:
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