Exhibit 4.5(a)
[XXXXXXXX CHANCE LOGO] LIMITED LIABILITY PARTNERSHIP
EXECUTION COPY
ELAN CORPORATION, PLC
ELAN PHARMA INTERNATIONAL LIMITED
ELAN PHARMACEUTICALS, INC.
VERNALIS DEVELOPMENT LIMITED
AND
VERNALIS PLC
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AGREEMENT RELATING TO THE NORTH AMERICAN
FROVA ASSETS OF ELAN
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CONTENTS
CLAUSE PAGE
1. Interpretation..........................................................2
2. Termination of Existing Agreements.....................................12
3. Sale and Purchase......................................................15
4. Conditions.............................................................16
5. Purchase Price.........................................................17
6. Completion.............................................................19
7. Warranties and Pre Completion Conduct..................................20
8. Vernalis's Warranties..................................................21
9. Vernalis Guarantee and Indemnity.......................................21
10. Transfer of the Product Registrations..................................23
11. Use of Elan Name.......................................................23
12. Contracts..............................................................25
13. Liabilities and Apportionments.........................................26
14. Returns Rebates and Chargebacks........................................27
15. Value Added Tax........................................................27
16. Post Completion Obligations............................................28
17. Further Undertakings by the Sellers....................................28
18. Records and Assistance.................................................30
19. Legal Disclosure.......................................................32
20. Confidential Information...............................................32
21. Announcements..........................................................33
22. Costs..................................................................34
23. Set Off................................................................34
24. Indemnification........................................................34
25. General................................................................35
26. Entire Agreement.......................................................36
27. Assignment.............................................................36
28. Notices................................................................37
29. Governing Law and Jurisdiction.........................................38
30. Counterparts...........................................................39
Schedule 1 PURCHASE PRICE...........................................40
CONTENTS
CLAUSE PAGE
Schedule 2 COMPLETION STATEMENT.....................................41
Schedule 3 COMPLETION REQUIREMENTS..................................44
Schedule 4 WARRANTIES...............................................46
Schedule 5 LIMITATIONS ON THE SELLERS' LIABILITY....................49
Schedule 6 ACTION PENDING COMPLETION................................52
Schedule 7 RESIDUAL CONTRACTS.......................................54
Schedule 8 RETURNS, REBATES AND CHARGEBACKS.........................56
Schedule 9 FROVA LOGO...............................................62
Schedule 10 PRODUCT IMAGE............................................63
AGREED FORM DOCUMENTS
1. US Registered Trade Xxxx Assignment (Clause 3.3)
2. Canadian Registered Trade Xxxx Assignment (Clause 3.3)
3. Deed of Assignment of Unregistered Intellectual Property (Clause 3.4)
4. Resolution (Clause 4.1.1)
5. Form of Novation for Supply Agreements (Clause 4.1.3)
6. Form of Assignment for Supply Agreements (Clause 4.1.3)
7. Recommendation (Clause 4.2.2)
8. Announcement by Elan Corp (Clause 21)
9. Announcement by Vernalis (Clause 21)
10. Transfer letters to FDA (paragraph 2(c) of Part A of Schedule 3)
11. Transfer letter to Health Canada (paragraph (2(d) of Part A of Schedule 3)
12. Transitional Services Agreement (paragraph 2(e) of Part A of Schedule 3)
13. Floating Charge (paragraph 3 of Part A of Schedule 3)
14. Amendment to API Supply Agreement (paragraph 3 of Schedule 6)
15. Customer Information Letter (paragraph 5 of Schedule 6)
16. Physician Information Letter (paragraph 5 of Schedule 6)
THIS AGREEMENT is made on March 2004
BETWEEN:
(1) ELAN CORPORATION PLC, a company incorporated in Ireland (registered No.
30356), whose registered office is at Xxxxxxx Xxxxx, Xxxxxxx Xxxxx, Xxxxxx
0, Xxxxxxx ("ELAN CORP");
(2) ELAN PHARMA INTERNATIONAL LIMITED, a company incorporated in Ireland
(registered no. 222276), whose registered office is at XXX Xxxxx, Xxxxxxx
Xxxxxxxx Xxxx, Xxxxxxx, Xxxxxx Xxxxx, Xxxxxxx ("EPIL");
(3) ELAN PHARMACEUTICALS, INC., a company incorporated in the State of
Delaware, whose principal office is at 000 Xxxxxxx Xxxxxxxxx, Xxxxx Xxx
Xxxxxxxxx, XX 00000, XXX ("EPI");
(4) VERNALIS DEVELOPMENT LIMITED, a company incorporated in England and Wales
(registered no. 02600483), whose registered office is at Oakdene Court,
613 Xxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxxx XX00 0XX ("VDL"); and
(5) VERNALIS PLC, a company incorporated in England and Wales (registered no.
2304992), whose registered office is at Oakdene Court, 613 Xxxxxxx Xxxx,
Xxxxxxxx, Xxxxxxxxx XX00 0XX ("VERNALIS").
WHEREAS:
(A) On 15 March 2002, EPIL and VDL (then registered as Vernalis Limited)
entered into:
(i) the Second Amended and Restated Licence Agreement to develop, market
and sell the Product in the Territory (each as defined below) (the
"LICENCE AGREEMENT"); and
(ii) the Amended and Restated Development Agreement to undertake further
clinical development of the Product (as defined below) (the
"DEVELOPMENT AGREEMENT").
(B) EPIL and VDL have agreed to terminate the Licence Agreement and the
Development Agreement on the terms of this Agreement.
(C) EPI has agreed to sell and VDL has agreed to buy certain of EPI's rights
under the Contracts (as defined below) to which it is a party.
(D) Elan Corp, EPIL and EPI (each a "SELLER" and together the "SELLERS") have
agreed to sell and VDL has agreed to buy all of the Sellers' other rights
and assets relating to the development, production, marketing,
distribution, sales and supply of the Product in the Territory (each as
defined below) on the terms of this Agreement.
(E) Vernalis has agreed, inter alia, to guarantee the due and punctual
performance of VDL's obligations under this agreement.
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THE PARTIES AGREE as follows:
1. INTERPRETATION
1.1 In this Agreement:
"ACT" means the Companies Xxx 0000;
"ACTUAL STOCK VALUE" means the value of the Stock at Completion as
specified in the Completion Statement;
"API SUPPLY AGREEMENT" means the supply agreement between EPIL and Evotec
OAI Limited (then named Oxford Asymmetry International plc), dated 28
December 2000 (as amended prior to Completion);
"ASSETS" means all the property and assets agreed to be sold and purchased
under Clause 3.1 of this Agreement;
"BUSINESS DAY" means a day other than a Saturday or Sunday or public
holiday in England and Wales;
"CIRCULAR" means the circular to be despatched by Vernalis to its
shareholders in relation to the proposed acquisition by VDL of the Assets
pursuant to this Agreement;
"COMPLETION" means completion of the sale and purchase of the Assets in
accordance with this Agreement;
"COMPLETION DATE" means the date which is three Business Days after the
date on which the last of the Conditions is satisfied or waived;
"COMPLETION STATEMENT" means the statement of the quantity and value of
Stock as at Completion agreed by EPI and Vernalis (or determined) in
accordance with Schedule 2;
"COMPOUND" means the compound known as frovatriptan being
R(+)6-carboxamido-3-N-methylamino-1,2,3,4 tetrahydrocarbazole succinate
(1:1) monohydrate and "Compound" shall include any physiologically
acceptable salts thereof;
"CONDITION" means a condition set out in Clause 4.1 and "CONDITIONS" means
all those conditions;
"CONFIDENTIAL INFORMATION" means all the Know-How and all other
information which is not in the public domain and which is used in or
otherwise relates to the Product, the Assets or customers or financial or
other affairs of the Sellers in relation to the Product and the Assets
including, without limitation, information relating to:
(a) the marketing of goods or services including, without limitation,
customer names and lists and other details of customers, sales
targets, sales statistics, market share statistics, prices, market
research reports and surveys, and advertising or other promotional
materials;
(b) future projects, business development or planning, commercial
relationships and negotiations; or
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(c) regulatory matters (including pharmacovigilance and medical
affairs); and
(d) clinical development (including in relation to preventing
menstrually-associated migraine headaches);
"CONTRACTS" means the Supply Agreements and the Residual Contracts;
"COPYRIGHT" means all (if any) right, title and interest of the Sellers
(or any of them) at Completion in copyright subsisting in (i) the
Delivered Records and (ii) the Marketing Materials but does not (in any
case) include any such copyright subsisting in any of the Xxxx Xxxxx;
"CUSTOMER INFORMATION LETTER" means the letter from EPI to wholesale
customers for the Product, in the agreed form;
"DEED OF ASSIGNMENT OF UNREGISTERED INTELLECTUAL PROPERTY" means an
assignment of the Seller's right, title and interest in the Copyright and
the Unregistered Trade Marks between the Sellers and VDL in the agreed
form to be entered into at Completion;
"DELIVERED RECORDS" means:
(a) all of the clinical files for the Product held by any Elan Group
Undertaking;
(b) the Product Registration Information;
(c) copies (or, where possible, originals) of each of the Contracts;
(d) registration certificates and prosecution history files in respect
of the Registered Trade Marks, in each case that are in the
possession or under the control of an Elan Group Undertaking; and
(e) the Marketing Materials that are in the possession or under the
control of an Elan Group Undertaking,
(f) all batch documentation in relation to the Product;
(g) all retained manufacturing samples in relation to the Product;
(h) all stability test data in relation to the Product;
(i) all CMC reports in relation to the Product, including transit
testing;
(j) monthly reports of sales of the Product by the Sellers in the
Territory broken down by wholesaler;
(k) all documents received by an Elan Group Undertaking concerning the
Product that assert ongoing material lack of compliance with any
applicable laws by any Elan Group Undertaking; and
(l) all:
(i) adverse drug experience reports and associated documents;
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(ii) investigations of adverse drug experience reports;
(iii) customer complaints; and
(iv) investigations of complaints,
in each case in relation to the Product,
other than the Retained Records;
"DISCLOSURE LETTER" means the letter from Elan Corp to VDL in relation to
the Warranties having the same date as this Agreement, the receipt of
which has been acknowledged by VDL;
"DOMAIN NAMES" means the URLs xxx.xxxxx.xxx, xxx.xxxxx.xxx, xxx.xxxxx.xx,
xxx.xxxxx.xxx, xxx.xxxxx.xxxx, xxx.xxxxxxxxxxxx.xxx and
xxx.xxxxxxxxxxxx.xx;
"ELAN GROUP UNDERTAKING" means each of the Sellers or an undertaking which
is, on or at any time after the date of this Agreement, a subsidiary
undertaking of Elan Corporation, plc;
"XXXX XXXXX" has the meaning given to it in Clause 11.1;
"ELAN PAYABLE AMOUNT" means any amount:
(a) agreed by EPI in writing as payable pursuant to this Agreement or
the Transitional Services Agreement by any Elan Group Undertaking to
any Vernalis Group Undertaking but not yet paid if due;
(b) ordered by a Court of competent jurisdiction to be paid by any Elan
Group Undertaking to any Vernalis Group Undertaking as a result of a
claim made pursuant to this Agreement or the Transitional Services
Agreement where either:
(i) the order can not be appealed; or
(ii) EPI has notified Vernalis that the relevant Elan Group
Undertaking does not intend to appeal such order; or
(c) payable by EPI pursuant to Schedule 8 save to the extent that the
Elan Companies (as defined in the Transitional Services Agreement)
account to VDL for such amount pursuant to clause 2.9 of the
Transitional Services Agreement;
"ELAN'S ACCOUNTANTS" means KMPG of 0 Xxxxxx Xxxxx, Xx Xxxxxxx'x Xxxxx,
Xxxxxx 0, Xxxxxxx;
"ELAN'S SOLICITORS" means Xxxxxxxx Chance Limited Liability Partnership of
00 Xxxxx Xxxx Xxxxxx, Xxxxxx X00 0XX;
"ENCUMBRANCE" means a mortgage, charge, pledge, lien, option, restriction,
right of first refusal, right of pre emption, third party right or
interest, other encumbrance or security
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interest of any kind, or another type of preferential arrangement (including,
without limitation, a title transfer or retention arrangement) having similar
effect;
"EPL" means Elan Pharma Limited, a company incorporated in Ireland (registered
no. 100382), whose registered office is at Xxxxxxxxx, Xxxxxxx, Xxxxxx Xxxxxxxxx,
Xxxxxxx;
"EQUIPMENT" means all (if any) right, title and interest of the Sellers (or any
of them) in any equipment used exclusively in the manufacture of the Product and
located at the premises of Pharmaceutical Development and Manufacturing Services
Limited (as successor in title to Xxxxx Limited) or Sharp Corporation;
"EVENT" means an event, act, transaction or omission including, without
limitation, a receipt or accrual of income or gains, distribution, failure to
distribute, acquisition, disposal, transfer, payment, loan or advance;
"FDA" means the U.S. Food and Drug Administration;
"FINANCING" means any equity-based or equity-linked cash-raising exercise by
Vernalis in the public securities markets;
"FLOATING CHARGE" means the floating charge between VDL and EPIL, in the agreed
form;
"HSR ACT" has the meaning given to it in Clause 4.1.2;
"INTELLECTUAL PROPERTY" means:
(a) patents, trade marks, service marks, registered designs, applications and
rights to apply for any of those rights; unregistered trade marks and
service marks; copyright, database right; rights in knowhow, rights in
designs and inventions; and
(b) rights of the same or similar effect or nature as or to those in paragraph
(a) which now or in the future may subsist,
"IP ASSETS" means the Trade Marks, the Copyright and the Domain Names;
"KEY WHOLESALERS" means Cardinal, McKesson, AmeriSourceBergen, Xxxxxx & Xxxxxxx
and D&K Healthcare;
"KNOW-HOW" means information in the possession of an Elan Group Undertaking
related exclusively to the regulation, development, sales and marketing of the
Product other than any such information which is in the public domain at
Completion;
"MARKETING MATERIALS" means any packaging, advertising and promotional
literature and materials in each case used exclusively in the advertising and
promotion of the Product in the Territory in the Sellers' possession as at
Completion;
"NOC" means any notice of compliance issued by Health Canada that the Product
has been evaluated and determined to comply with the applicable provisions of
Division 8 of the Food and Drugs Act Regulations (Canada);
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"PHYSICIAN INFORMATION LETTER" means the letter from EPI to physicians, in the
agreed form;
"PARENT PROCEEDING" means any claim made by or against any Elan Group
Undertaking or any officers, directors or employees of any Elan Group
Undertaking in any legal proceeding or governmental investigation by or against
any Elan Group Undertaking or any officers, directors or employees of any Elan
Group Undertaking which is commenced either:
(a) prior to Completion; or
(b) after Completion but based on events occurring prior to Completion;
"PERMITTED ENCUMBRANCES" means:
(a) any encumbrance arising by operation of law;
(b) any third party rights over Stock which has been ordered but not yet
delivered;
(c) any rights of UCB and any advertising agency in relation to Marketing
Materials for the Product, together with any rights of third parties
appearing in Marketing Materials for the Product;
(d) without prejudice to Clause 12 of this Agreement, any right or obligation
of any third parties arising under any of the Contracts; and
(e) any right of UCB in relation to the xxxx "UCB" as it appears on the Product
packaging;
"PRODUCT" means any and all formulated and packaged pharmaceutical compositions
and dosing units containing Compound including compositions comprising Compound;
"PRODUCT REGISTRATIONS" means:
(a) the New Drug Application number NDA 21-006 filed in respect of the Product
pursuant to 21 C.F.R. Part 314 of the U.S. Food, Drug and Cosmetic Xxx
0000;
(b) the Investigational New Drug Application number IND 48,933 (encompassing,
inter alia, the identification of intention to study the use of
frovatriptan for the prevention of menstrually-associated migraine) filed
in respect of the Product pursuant to C.F.R Parts 312 of the U.S. Food,
Drug and Cosmetic Xxx 0000;
(c) the New Drug Submission control number 065221 made pursuant to Division 8
of the Food and Drugs Act Regulations (Canada); and
(d) all supplements or amendments to any of the foregoing,
whether filed before or after the date of this Agreement, but in any case prior
to the Completion Date;
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"PRODUCT REGISTRATION INFORMATION" means:
(a) the complete New Drug Application, Investigational New Drug Application and
New Drug Submission files referred to in or served in relation to the
Product Registration;
(b) any and all regulatory correspondence between the Sellers and any
regulatory authority in the Territory in relation to the Product
Registrations or the Product; and
(c) all dossiers, data, reports and other material in written or electronic
form exclusively relating to the Product Registrations or the Product which
have been filed with any governmental or regulatory authority;
"RECOMMENDATION" means the unanimous recommendation of the Vernalis directors
that Vernalis's shareholders should vote in favour of the Resolution, in the
agreed form;
"REGISTERED TRADE XXXX ASSIGNMENTS" means assignments of the Registered Trade
Marks between EPI and VDL in the agreed form to be entered into at Completion;
"REGISTERED TRADE MARKS" means U.S. Federal trade xxxx application no. 78017693
and Canadian trade xxxx application no. 1123447, each for 'FROVA';
"RELEVANT CLAIM" means a claim by Vernalis for any breach or alleged breach of
any of the Warranties;
"RESIDUAL CONTRACTS" means those contracts listed in Schedule 7;
"RESOLUTION" means the resolution of Vernalis's shareholders approving the
transactions contemplated by this Agreement in the agreed form;
"RETAINED RECORDS" means the originals of:
(a) all quarterly and year-end financial statements prepared between 1 January
1996 and Completion;
(b) all general ledgers, trial balances and adjusting journal entries
(including support for journals), Frango and similar financial submissions
to corporate or divisional management (e.g. Dublin, San Diego, Stevenage)
and related documentation supporting the financial statements of any Elan
Group Undertaking prepared or issued between 1 January 1996 and Completion;
(c) all documents concerning revenue, earnings per share and/or profit
projections for any time period from 1 January 1996 through Completion,
including any documents setting or tracking internal financial goals or
projections and any documents discussing whether Elan Corporation, plc or
any Elan Group Undertaking would meet internal financial goals or
projections;
(d) all original backup tapes of the network system of any Elan Group
Undertaking from the date closest to 13 February 2002 until Completion;
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(e) all documents relating to any joint venture or strategic collaboration
between any Elan Group Undertaking and any third party and any documents
relating to any Elan Group Undertaking's investments in any such third
parties;
(f) all documents identifying reserves or provisions maintained on the books of
any Elan Group Undertaking between 1 January 1996 and 31 December 2002;
(g) all documents concerning the establishment, use, reversal and/or
adjustments to all reserves or provisions identified in sub-paragraph (f)
between 1 January 1996 and 31 December 2002, including budgeted amounts,
journal entries, general ledger accounts, spreadsheets, analyses and
correspondence (including e-mail);
(h) all documents concerning any "Corporate provision release" of any Elan
Group Undertaking between 1 January 1996 and 31 December, 2002;
(i) all documents identifying an instance in which reducing reserves of any
Elan Group Undertaking contributed to any Elan Group Undertaking meeting or
exceeding its: (i) internal financial forecasts or budgets; (ii) strategic
plan objectives; or (iii) consensus analysts' earnings estimates, in each
case between 1 January 1996 and Completion;
(j) all documents concerning any assessment by any Elan Group Undertaking to
increase or decrease trade inventory levels at wholesalers in order for any
Elan Group Undertaking to meet or achieve any: (i) internal financial
forecasts or budgets; (ii) strategic plan objectives; or (iii) consensus
analysts' earnings estimates, in each case between 1 January 1996 and
Completion;
(k) all documents concerning any assessment by any Elan Group Undertaking to
provide discounts and/or incentives to wholesale or chain customers in
order for any Elan Group Undertaking to meet or achieve any: (i) internal
financial forecasts or budgets; (ii) strategic plan objectives; or (iii)
consensus analysts' earnings estimates, in each case between 1 January 1996
and Completion;
(l) all other financial records (whether relating to the Assets, the Product or
otherwise);
(m) all other tax records (whether relating to the Assets, the Product or
otherwise); and
(n) all human resources files;
"STOCK" means the stock of:
(a) Frova 2.5mg Tab, 2 Count Sample Blister;
(b) Frova 2.5mg Tab, 9 Count Blister;
(c) Frova 2.5mg Bulk Tablets;
(d) Frova 2.5mg Tab, Bulk Samples;
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(e) 4-Cyanophenyl Hydrazine, HCL;
(f) Amine Ketal HCL; and
(g) Frovatriptan Succinate,
in each case held by or on behalf of the Sellers (other than that held by or on
behalf of UCB) at Completion or which has been ordered from Sharp Corporation
but not delivered at Completion;
"SUPPLY AGREEMENT" means:
(a) the API Supply Agreement; or
(b) the Frovatriptan supply agreement between EPIL and Xxxxx Limited, dated 1
July 2002,
and "SUPPLY AGREEMENTS" means both of them;
"TAX" means any form of taxation, levy, duty, charge, contribution, withholding
or impost of whatever nature (including any related fine, penalty, surcharge or
interest) imposed, collected or assessed by, or payable to, a Tax Authority;
"TAX AUTHORITY" means any government, state or municipality or any local, state,
federal or other authority, body or official anywhere in the world exercising a
fiscal, revenue, customs or excise function including, without limitation, the
Inland Revenue and H.M. Customs & Excise;
"TERRITORY" means Canada, Mexico, the United States of America, its territories
and possessions and the Commonwealth of Puerto Rico;
"TRADE CREDITS" means all amounts owing by a Seller under the Contracts as at
Completion (whether or not invoiced and whether or not due and payable at that
time) and "TRADE CREDIT" means any of those amounts;
"TRADE DEBTS" means all amounts owing to a Seller under the Contracts as at
Completion (whether or not invoiced and whether or not due and payable at that
time) and "TRADE DEBT" means any of those amounts;
"TRADE MARKS" means (i) the Registered Trade Marks, and (ii) the Unregistered
Trade Marks;
"TRANSITIONAL SERVICES AGREEMENT" means the transitional services agreement
between Elan Corp, EPI, EPL and VDL in the agreed form;
"UCB" means UCB Coprom, L.P;
"UCB AGREEMENT" means the Frovatriptan Co-Promotion Agreement made between EPI
and UCB, dated 27 March 2002;
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"UNREGISTERED TRADE MARKS" means all of the Seller's right, title and interest
at Completion in the name and xxxx FROVA and in the logo reproduced in Schedule
9 (The Frova Logo) in the Territory (in each case);
"VAT" means (a) any value added tax imposed by any primary or subordinate
legislation promulgated by the European Community or any body or agency thereof
(including under or pursuant to any domestic legislation enacting or
implementing the same); and (b) any other tax of a similar fiscal nature,
whether imposed in a member state of the European Union in substitution for or
in addition to such tax, or imposed elsewhere;
"VERNALIS GROUP UNDERTAKING" means Vernalis or an undertaking which is, on or at
any time after the date of this Agreement, a subsidiary undertaking of Vernalis;
"VERNALIS PAYABLE AMOUNT" means any amount:
(a) agreed by Vernalis in writing as payable pursuant to this Agreement or the
Transitional Services Agreement by any Vernalis Group Undertaking to any
Elan Group Undertaking but not yet paid if due;
(b) ordered by a Court of competent jurisdiction to be paid by any Vernalis
Group Undertaking to any Elan Group Undertaking as a result of a claim made
pursuant to this Agreement or the Transitional Services Agreement where
either:
(i) the order can not be appealed; or
(ii) Vernalis has notified EPI that the relevant Vernalis Group Undertaking
does not intend to appeal such order; or
(c) payable by Vernalis pursuant to Schedule 8 save to the extent that the Elan
Companies (as defined in the Transitional Services Agreement) take such
amount into account pursuant to clause 2.9 of the Transitional Services
Agreement;
"VERNALIS'S ACCOUNTANTS" means PricewaterhouseCoopers LLP of 0 Xxxxxxxxxx Xxxxx,
Xxxxxx XX0X 0XX;
"VERNALIS'S SOLICITORS" means Xxxxx & Overy of Xxx Xxx Xxxxxx, Xxxxxx, XX0X 0XX;
and
"WARRANTY" means a statement contained in Schedule 4 and "WARRANTIES" means all
those statements.
1.2 In this Agreement, a reference to:
1.2.1 a "SUBSIDIARY UNDERTAKING" or "PARENT UNDERTAKING" is to be
construed in accordance with section 258 of the Act and a
"SUBSIDIARY" or "HOLDING COMPANY" is to be construed in
accordance with section 736 of the Act;
1.2.2 liability under, pursuant to or arising out of (or any
analogous expression) any agreement, contract, deed or other
instrument includes a reference to contingent
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liability under, pursuant to or arising out of (or any
analogous expression) that agreement, contract, deed or other
instrument;
1.2.3 a party being liable to another party, or to liability,
includes, but is not limited to, any liability in equity,
contract or tort (including negligence) or under the
Xxxxxxxxxxxxxxxxx Xxx 0000;
1.2.4 a document in the "AGREED FORM" is a reference to a document
in a form approved and for the purposes of identification
signed by or on behalf of each party;
1.2.5 a statutory provision (except where stated otherwise) includes
a reference to the statutory provision as modified or re
enacted or both from time to time before the date of this
Agreement and any subordinate legislation made under the
statutory provision (as so modified or re enacted) before the
date of this Agreement;
1.2.6 a "PERSON" includes a reference to any individual, firm,
company, corporation or other body corporate, government,
state or agency of a state or any joint venture, association
or partnership, works council or employee representative body
(whether or not having separate legal personality);
1.2.7 a person includes a reference to that person's legal personal
representatives, successors and permitted assigns;
1.2.8 a "PARTY" includes a reference to that party's successors and
permitted assigns;
1.2.9 a "CLAUSE", "PARAGRAPH" or "SCHEDULE", unless the context
otherwise requires, is a reference to a clause or paragraph
of, or schedule to, this Agreement;
1.2.10 any English legal term for any action, remedy, method of
judicial proceeding, legal document, legal status, court,
official or any legal concept or thing shall, in respect of
any jurisdiction other than England, be deemed to include what
most nearly approximates in that jurisdiction to the English
legal term and to any English statute shall be construed so as
to include equivalent or analogous laws of any other
jurisdiction;
1.2.11 a time of day is a reference to the time in London; and
1.2.12 "US$", "$" or "DOLLARS" is a reference to the lawful currency
of the United States of America.
1.3 The headings in this Agreement do not affect its interpretation.
1.4 Where in Clauses 18.6 and 19 and in the definition of Parent Proceeding
and Retained Records in Clause 1.1 the term "Elan Group Undertaking" is
used, that term is to be construed as if the words "on or at any time
after the date of the Agreement" in its definition in Clause 1.1 were
replaced by the words "from time to time".
1.5 Where any statement in Schedule 4 is qualified by the expression "so far
as the Sellers are aware" or any similar expression, that expression or
statement shall be limited to the
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actual knowledge (having made reasonable enquiries in relation to the
subject matter of the statement) of the persons set out below as at the
date of this Agreement:
1.5.1 in relation to all the Warranties, Xxxxxx Xxxxxxxx
1.5.2 in relation to the Warranties contained in paragraphs 4.2 and
4.3, Xxxxx Xxxxxxxxx;
1.5.3 in relation to the Warranty in paragraph 5.1, Xxxx Xxxxxx
Xxxxxxxx;
1.5.4 in relation to the Warranties in paragraph 6.1, Xxxxxx
Xxxxxxx;
1.5.5 in relation to the Warranty in paragraph 6.2, Xxxxxx Xxxxxxx;
1.5.6 in relation to the Warranty in paragraph 8, Xxxxxxx Xxxx;
1.5.7 in relation to the Warranty in paragraph 9, Xxxxx Xxxxxxx; and
1.5.8 in relation to the Warranty in paragraph 10, Xxxxxx X'Xxxxxx
and Xxxxx Xxxxxx.
2. TERMINATION OF EXISTING AGREEMENTS
2.1 Each of EPIL and VDL agrees that, with effect from Completion and
subject to Clause 2.2:
2.1.1 other than clauses 1, 7.9, 7.10, 12.1, 12.2, 17, 18, 19, 20,
21 and 22 of the Licence Agreement, all provisions of the
Licence Agreement shall terminate and cease to be of any force
or effect whatsoever (notwithstanding anything to the contrary
in the Licence Agreement), including without limitation (and
save as provided above), each of its accrued rights and
obligations thereunder at Completion; and
2.1.2 the Development Agreement shall terminate and cease to be of
any force or effect whatsoever, including without limitation,
the provisions thereof expressly stated to survive termination
and each of the accrued rights and obligations thereunder at
Completion .
2.1.3 it shall waive any rights that it may have accrued against the
other and each of the other's Group Undertakings, officers,
directors, representatives, agents and employees and the
assigns and successors in interest of any of the foregoing
entities ("RELEASEES") under the Development Agreement and
under the provisions of the Licence Agreement terminated by
Clause 2.1.1;
2.1.4 it fully and finally releases and discharges the other's
Releasees from any and all manner, claims and obligations
(whether actual or contingent), of any nature whatsoever that
it may have under the Development Agreement and the provisions
of the Licence Agreement terminated by Clause 2.1.1; and
2.1.5 it shall not attempt to enforce any rights which (but for
Clauses 2.1.1 to 2.1.4) it would otherwise have had under the
Licence Agreement and the Development Agreement.
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For the purposes of this Clause 2.1 "GROUP UNDERTAKING" means, in
relation to a party, such party or an undertaking which is, on or at any
time after the date of this Agreement, a subsidiary undertaking or
parent undertaking of such party or a subsidiary undertaking of a parent
undertaking of such party. Each Releasee may enforce the terms of this
Clause 2.1 subject to and in accordance with the provisions of the
Contracts (Rights of Third Parties) Xxx 0000.
2.2 Notwithstanding the provisions of Clause 2.1, EPIL shall remain liable
to pay any royalties accrued in the period prior to Completion pursuant
to clause 7.2 of the Licence Agreement.
2.3 Each Seller shall indemnify each Vernalis Group Undertaking against all
liability, cost and expense to such Vernalis Group Undertaking arising
out of the development, testing, manufacture, use or sale of the Product
by an Elan Group Undertaking or its permitted sub-licensees unless such
liability, cost or expense is caused by the negligent or intentional
acts or omissions of VDL or any undertaking which was, at that time, a
subsidiary undertaking or parent undertaking of VDL or a subsidiary
undertaking of a parent undertaking of VDL. Each Vernalis Group
Undertaking may enforce the terms of this Clause 2.3 subject to and in
accordance with the provisions of the Contracts (Rights of Third
Parties) Xxx 0000.
2.4 Vernalis shall indemnify each Elan Group Undertaking against all
liability, cost and expense incurred by such Elan Group Undertaking in
connection with the Product, other than arising out of the development,
testing, manufacture, use or sale of the Product by an Elan Group
Undertaking or its permitted sub-licensees which is not caused by the
negligent or intentional acts or omissions of VDL or any undertaking
which was, at that time, a subsidiary undertaking or parent undertaking
of VDL or a subsidiary undertaking of a parent undertaking of VDL. Each
Elan Group Undertaking may enforce the terms of this Clause 2.4 subject
to and in accordance with the provisions of the Contracts (Rights of
Third Parties) Xxx 0000.
2.5 The Sellers shall indemnify each Vernalis Group Undertaking against all
legal costs and expenses which such Vernalis Group Undertaking may
suffer or incur (i) arising out of any claim which may be brought by UCB
or any affiliate thereof against any Elan Group Undertaking or (ii) in
defending any action, claim or proceeding brought by UCB or any
affiliate thereof against a Vernalis Group Undertaking, in each case,
arising out of the termination of the UCB Agreement or the transactions
under this Agreement provided that the maximum liability of the Sellers
under this indemnity shall not exceed $2,000,000. The provisions of
Clause 24 shall not apply to the indemnity in this Clause 2.5.
2.6 If VDL becomes aware of a claim by UCB or any of its affiliates which
may give rise to a claim for indemnification under Clause 2.5 (a "UCB
CLAIM"), VDL shall notify and consult with EPI as soon as reasonably
practicable in respect of the UCB Claim.
2.7 Until the legal costs and expenses which the Vernalis Group Undertakings
together have suffered or incurred in circumstances set out in Clause
2.5 exceed $2,000,000, VDL shall:
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2.7.1 take any action and institute any proceedings, and give any
information and assistance, as EPI or its insurers may
reasonably request to:
(a) dispute, resist, appeal, compromise, defend, remedy or
mitigate the UCB Claim; or
(b) enforce against a person (other than the Sellers) the
rights of the relevant Vernalis Group Undertaking or of
its insurers in relation to the UCB Claim; and
2.7.2 in connection with negotiations or proceedings related to the
UCB Claim use advisers chosen by EPI or its insurers and, if
EPI requests, allow EPI or its insurers the exclusive conduct
of the proceedings, provided, however, that:
(a) EPI shall keep VDL informed of the progress of the
negotiations or proceedings;
(b) EPI shall not take any material action in connection
with the negotiations or proceedings without VDL's
consent (such consent not to be unreasonably withheld or
delayed);
(c) if, at EPI's direction, the relevant Vernalis Group
Undertaking admits liability in respect of or settles
the UCB Claim, EPI shall pay to such Vernalis Group
Undertaking any amount which such Vernalis Group
Undertaking is obliged to pay to UCB and any of its
affiliates in relation to such admission or settlement
and for the avoidance of doubt such payment is not
subject to any limit;
(d) the relevant Vernalis Group Undertaking may admit
liability in respect of or settle the UCB Claim when the
Sellers shall pay to such Vernalis Group Undertaking the
lesser of:
(i) 50 per cent. of any amount which such Vernalis
Group Undertaking is obliged to pay to UCB and
any of its affiliates in relation to such
admission or settlement; and
(ii) $2,000,000 less the aggregate of all amounts paid
or payable by the Sellers pursuant to Clause 2.5,
provided that any such admission or settlement under
this Clause 2.7.2(d) need not be at EPI's direction and
is without prejudice to the Sellers' obligations under
Clause 2.5; and
(e) if EPI elects to instruct one firm of attorneys to
represent both an Elan Group Undertaking and a Vernalis
Group Undertaking in connection with the UCB Claim, any
legal costs and expenses which a Vernalis Group
Undertaking suffers or incurs and which the Sellers pay
shall only be treated as a liability of the Sellers for
determining their maximum liability pursuant to Clause
2.5 if such costs and expenses would not have been
incurred by the Elan Group Undertaking with such firm if
such firm was
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only representing the Elan Group Undertaking in
connection with the UCB Claim.
2.8 Nothing in this Clause 2 shall serve to release or discharge a party in
respect of any fraud on the part of such party.
3. SALE AND PURCHASE
3.1 The Sellers agree to sell with full title guarantee and free of any
Encumbrance (other than any Permitted Encumbrance) and VDL agrees to
buy, in each case with effect from Completion, the following Assets:
3.1.1 the benefit (subject to the burden) of each Contract solely
insofar as it relates to the Compound and/or the Product (as
the case may be);
3.1.2 the IP Assets;
3.1.3 the Equipment;
3.1.4 the Delivered Records; and
3.1.5 the Stock.
Property and risk in the Assets shall vest in VDL on Completion.
3.2 The Product Registrations shall be transferred in accordance with the
provisions of Clause 10.
3.3 With respect to the Registered Trade Marks, and notwithstanding any
other provision of this Agreement, this Agreement shall take effect as
an agreement to sell such rights, with the sale being completed by the
entry of EPI and VDL into the Registered Trade Xxxx Assignments.
3.4 With respect to the Copyright and Unregistered Trade Marks, and
notwithstanding any other provision of this Agreement, this Agreement
shall take effect as an agreement to sell such rights, with the sale
being completed by the entry of the Sellers and VDL into the Deed of
Assignment of Unregistered Intellectual Property.
3.5 With respect to the Domain Names, the Sellers shall on request by VDL
from time to time at their own expense do and execute or arrange for the
doing and executing of, each necessary act, document and thing
reasonably within its power to transfer the Domain Names to VDL. If VDL
elects to record or lodge any document with any registrar of domain
names in respect of any of the Domain Names, it shall do so at its own
cost and expense.
3.6 Nothing in this Agreement shall operate to transfer
3.6.1 any cash in hand and at bank;
3.6.2 any Trade Debts; or
3.6.3 any Retained Records.
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4. CONDITIONS
4.1 Completion is conditional on the following Conditions being satisfied,
or in the case of the Conditions in Clauses 4.1.1 and 4.1.3 being waived
by Vernalis, on or before 11 a.m. on 30 June 2004:
4.1.1 Vernalis's shareholders passing the Resolution without
amendment at a general meeting of Vernalis's shareholders;
4.1.2 any applicable waiting period under the Xxxx Xxxxx Xxxxxx
Anti-trust Improvements Xxx 0000, as amended, and any
regulations made thereunder ("HSR ACT") relating to the
proposed acquisition of the Assets pursuant to this Agreement
having expired or been terminated; and
4.1.3 EPIL obtaining written consent (conditional only upon
Completion) to the novation or assignment of each Supply
Agreement being either in the agreed form or in such form as
is satisfactory to Vernalis acting reasonably.
4.2 Vernalis shall, and shall procure that the directors of Vernalis shall:
4.2.1 make all reasonable efforts to achieve satisfaction of each
Condition as soon as possible after the date of this
Agreement;
4.2.2 post the Circular to its shareholders, including the text of
the Resolution together with the Recommendation, no later than
30 April 2004;
4.2.3 insofar as is consistent with the fiduciary duties of the
directors of Vernalis, not withdraw or change the nature of
recommendation of its directors to its shareholders from that
in the agreed form;
4.2.4 procure that a validly constituted and quorate meeting of its
shareholders is held no later than 17 May 2004 that considers
and votes on the Resolution;
4.2.5 make, no later than 13 April 2004, an appropriate filing of a
notification and report form pursuant to the HSR Act in
relation to the proposed acquisition of assets pursuant to
this Agreement; and
4.2.6 supply promptly any additional information and documentary
material that may be requested by any United States anti trust
authority pursuant to the HSR Act in relation to such HSR Act
filing.
4.3 Each of the Sellers shall make all reasonable efforts to achieve
satisfaction of the Conditions set out in Clauses 4.1.2 and 4.1.3 as
soon as possible after the date of this Agreement.
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4.4 Elan Corp shall:
4.4.1 make, no later than 13 April 2004, an appropriate filing of a
notification and report form pursuant to the HSR Act in
relation to the proposed acquisition of assets pursuant to
this Agreement; and
4.4.2 supply promptly any additional information and documentary
material that may be requested by any United States anti trust
authority pursuant to the HSR Act in relation to such HSR Act
filing.
4.5 Each party shall (and shall, to the extent possible, procure that its
advisers shall), at the request of another party, provide such
co-operation and assistance to such party as is reasonably necessary to
ensure that the Conditions are satisfied as soon as possible after the
date of this Agreement always provided that neither Vernalis nor VDL
need make any payment to any party to a Supply Agreement, in relation to
obtaining any consent pursuant to Clause 4.1.3. In particular, the
Sellers shall provide such information within their possession in
relation to the Assets and the Sellers as may be reasonably requested by
Vernalis following the requirements of the UK Listing Authority or the
Federal Trade Commission for inclusion in the Circular or the filing in
respect of the HSR Act provided that if such information or any
reference to the Sellers is to be incorporated into the Circular or such
filing then Vernalis shall obtain Elan's written consent (not to be
unreasonably withheld or delayed) to such information or reference.
4.6 If, at any time, a party becomes aware of a fact or circumstance that
might prevent a Condition being satisfied, it shall immediately inform
the other parties.
4.7 At any time on or before 11 a.m. on 30 June 2004 Vernalis may waive the
Conditions set out in Clauses 4.1.1 and 4.1.3 by notice to the Sellers.
4.8 If any Condition has not been waived by Vernalis pursuant to Clause 4.7
or has not been satisfied by 11 a.m. on 30 June 2004 any party may
terminate this Agreement with immediate effect at any time thereafter.
4.9 In the event that:
4.9.1 a meeting of the shareholders of Vernalis, does not vote on
the Resolution on or before 30 June 2004; or
4.9.2 Vernalis withdraws or changes the nature of the Recommendation
and Vernalis's shareholders do not approve the Resolution,
VDL shall immediately pay to EPIL the amount of $750,000 (plus VAT if
applicable).
4.10 Each party's further rights and obligations (other than pursuant to
Clause 4.9) cease immediately on termination of this Agreement pursuant
to Clause 4.8, but termination does not affect a party's accrued rights
and obligations at the date of termination.
5. PURCHASE PRICE
5.1 The price payable under this Agreement is:
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5.1.1 $49,845,000 in respect of the termination of EPIL's rights
under the Licence Agreement and, the Development Agreement
pursuant to Clause 2; and
5.1.2 in respect of the Assets, the amount obtained by adding
together:
(a) $155,000, in respect of the assets listed in the first
column of Schedule 1, apportioned between them as shown
in the second column of Schedule 1; and
(b) in respect of the Stock, the Actual Stock Value.
5.2 At Completion VDL shall pay $5,000,000 to EPIL on account of the
consideration payable under Clause 5.1.1.
5.3 On the earlier of:
5.3.1 the completion of the Financing; and
5.3.2 31 December 2004,
VDL shall pay the Actual Stock Value to EPIL on account of the purchase
price payable under Clause 5.1.2.
5.4 On 31 December 2004, VDL shall pay $20,000,000 to EPIL on account of the
consideration payable under Clause 5.1.1.
5.5 On 31 December 2005, VDL shall pay $25,000,000 to EPIL (representing the
remaining consideration payable under Clause 5.1.1 and the remaining
purchase price payable under Clause 5.1.2).
5.6 In the event that (a) a Vernalis Group Undertaking disposes, in good
faith on arms' length terms, of all or part of its US rights in the
Product to a person which is not a Vernalis Group Undertaking and (b)
all or substantially all of the consideration payable in respect of such
disposal is cash payable upon the completion of such disposal, VDL shall
within 30 days pay EPIL the lesser of:
5.6.1 the amount of such cash consideration less any reasonable
costs which such Vernalis Group Undertaking incurred in
connection with or which relates to such disposal (including
costs of any advisers and costs relating to regulatory,
governmental or shareholder approvals required to effect such
disposal); or
5.6.2 the aggregate of the sums then payable by VDL to EPIL pursuant
to Clauses 5.3 , 5.4 and 5.5,
(the "REPAYMENT AMOUNT").
5.7 Any Repayment Amount shall be applied by EPIL as follows:
5.7.1 first, in reducing or discharging (as the case may be) on a
dollar for dollar basis VDL's obligation to pay EPIL under
Clause 5.3;
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5.7.2 next (if applicable), in reducing or discharging (as the case
may be) on a dollar for dollar basis VDL's obligation to pay
EPIL under Clause 5.4; and
5.7.3 finally (if applicable), in reducing or discharging (as the
case may be) on a dollar for dollar basis VDL's obligation to
pay EPIL under Clause 5.5.
5.8 In the event that:
5.8.1 VDL fails to make any payment under Clause 5.3, 5.4 or 5.5
within 30 days of the date on which it is due;
5.8.2 VDL breaches any provision of the Floating Charge, or any
other entity which executes a floating charge pursuant to
Clause 16.3 of this Agreement breaches any provision of such
floating charge;
5.8.3 a petition or application is presented for the making of an
administration order in relation to VDL or Vernalis;
5.8.4 any person who is entitled to do so gives written notice of
its intention to appoint an administrator of VDL or Vernalis
or files such a notice with the court;
5.8.5 either VDL or Vernalis passes a resolution for its winding up
or a court of competent jurisdiction makes an order for VDL's
or Vernalis's winding up or dissolution;
5.8.6 an administrator of VDL or Vernalis is appointed, or a
receiver is appointed over, or an encumbrancer takes
possession of or sells, an asset of VDL or Vernalis; or
5.8.7 either VDL or Vernalis makes an arrangement or composition
with its creditors generally or makes an application to a
court of competent jurisdiction for protection from its
creditors generally,
all amounts which have not then been paid pursuant to Clauses 5.3, 5.4
and 5.5 shall become immediately due and payable.
5.9 Where EPIL receives a sum from VDL pursuant to this Clause 5 relating to
Assets owned by another Elan Group Undertaking, EPIL shall receive such
sum on trust for the Elan Group Undertaking entitled to such sum. The
receipt by EPIL of any such sum shall discharge VDL's obligations to pay
such sum to any Elan Group Undertaking and VDL shall not be bound to
enquire as to the application by EPIL of any such sum received from VDL.
6. COMPLETION
6.1 Completion shall take place at the office of Elan's Solicitors on the
Completion Date.
6.2 At Completion, the Sellers and Vernalis shall do all those things
respectively required of them in Schedule 3 and VDL shall pay the amount
stated in Clause 5.2 to EPIL to the account which is notified to VDL by
EPIL prior to Completion.
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6.3 If Completion does not take place on the Completion Date because the
Sellers fail to comply with any of their obligations under Clause 6 and
Schedule 3, Vernalis may by notice to the Sellers:
6.3.1 proceed to Completion to the extent reasonably practicable
(but if Vernalis exercises its right pursuant to this Clause
6.3.1, completion of the purchase of some of the Assets does
not affect Vernalis's rights in connection with the others);
or
6.3.2 postpone Completion to a date not earlier than two Business
Days after the Completion Date and not later than 5 July 2004.
6.4 If Completion does not take place on the Completion Date because
Vernalis fails to comply with any of its obligations under Clause 6 and
Schedule 3, the Sellers may by notice to Vernalis:
6.4.1 proceed to Completion to the extent reasonably practicable
(but if the Sellers exercise their right pursuant to this
Clause 6.4.1, completion of the purchase of some of the Assets
does not affect the rights of the Sellers in connection with
the others); or
6.4.2 postpone Completion to a date not earlier than two Business
Days after the Completion Date and not later than 5 July 2004.
6.5 If Vernalis or the Sellers postpones Completion to another date in
accordance with Clause 6.3.2 or 6.4.2, the provisions of this Agreement
apply as if that other date is the Completion Date.
6.6 If Completion has not occurred on or before 5 July 2004 any party may
elect to terminate this Agreement. If this Agreement is terminated
pursuant to this Clause 6.6, each party's further rights and obligations
(other than pursuant to Clause 4.9) cease immediately on termination,
but termination does not affect a party's accrued rights and obligations
at the date of termination.
7. WARRANTIES AND PRE COMPLETION CONDUCT
7.1 The Sellers jointly and severally warrant to VDL on the terms set out in
Schedule 4. For this purpose only, where in a Warranty or in the
Disclosure Letter:
7.1.1 the term "Copyright", "Marketing Materials", "Stock" or
"Unregistered Trade Marks" is used or referred to, each term
is to be construed as if the words "Completion" in its
definition in Clause 1.1 were replaced with the words "the
date of this Agreement"; and
7.1.2 the term "Assets" and "IP Assets" is used or referred to, each
term is to be construed as if the terms listed in Clause 7.1.1
were construed in accordance with that clause.
7.2 The Sellers' liability for Relevant Claims shall be limited or excluded,
as the case may be, as set out in Schedule 5.
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7.3 Each of the Warranties are qualified by the facts and circumstances
fairly disclosed in the Disclosure Letter.
7.4 Subject to Clause 7.3, each of the Warranties, which are separate and
independent, is not, except as expressly provided in this Agreement,
limited by any other paragraph in the Warranties Schedule or this
Agreement.
7.5 Between the execution of this Agreement and Completion, each Seller
shall comply with Schedule 6.
7.6 If before Completion the Product Registration is revoked or there is a
recall of Product, then VDL may serve a notice on EPI (a "TERMINATION
NOTICE"). If VDL does not serve a Termination Notice pursuant to this
Clause 7.6 and proceeds to Completion, no Seller shall be liable for any
claim under this Agreement (including any Relevant Claim) arising from
such revocation of the Product Registration or such recall of Product
(as the case may be) or from any matter giving rise to such revocation
or recall.
7.7 Upon receipt of a Termination Notice:
7.7.1 this Agreement shall terminate and each party's further rights
and obligations cease immediately on termination; but
7.7.2 termination does not affect any party's accrued rights and
obligations at such time.
7.8 Except as set out in Clauses 7.6 and 7.7, neither Vernalis nor VDL shall
be entitled to rescind or otherwise seek in any way to terminate this
Agreement other than for fraud.
8. VERNALIS'S WARRANTIES
8.1 Vernalis warrants to the Sellers that:
8.1.1 each of Vernalis and VDL has the right, power and authority,
and has taken all action necessary, to execute, deliver and
exercise its respective rights and perform its respective
obligations under this Agreement and each document to be
executed by it at or before Completion; and
8.1.2 the obligations of each of Vernalis and VDL under this
Agreement and each document to be executed by it at or before
Completion are, or when the relevant document is executed will
be, enforceable in accordance with its respective terms.
9. VERNALIS GUARANTEE AND INDEMNITY
9.1 Vernalis irrevocably and unconditionally guarantees to each Seller the
due and punctual performance of each obligation of VDL contained in this
Agreement and the Transitional Services Agreement. Vernalis shall pay to
each Seller from time to time on demand any sum of money which VDL is at
any time liable to pay to such Seller under or pursuant to this
Agreement or the Transitional Services Agreement and which has not been
paid at the time the demand is made. Vernalis's obligations under this
clause are primary obligations and not those of a mere surety.
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9.2 Vernalis irrevocably and unconditionally agrees to indemnify (and keep
indemnified) each Seller on demand against any loss, liability or cost
incurred by such Seller as a result of any obligation of VDL referred to
in Clause 9.1 above being or becoming void, voidable or unenforceable as
against VDL for any reason whatsoever. The amount of the loss, liability
or cost shall be equal to the amount which such Seller would otherwise
have been entitled to recover from VDL.
9.3 Vernalis's obligations under Clauses 9.1 and 9.2 are continuing
obligations and are not satisfied, discharged or affected by an
intermediate payment or settlement of account by, or a change in the
constitution or control of, or merger or consolidation with any other
person of, or the insolvency of, or bankruptcy, winding up or analogous
proceedings relating to, VDL.
9.4 Vernalis's liabilities under Clauses 9.1 and 9.2 are not affected by an
arrangement which a Seller may make with VDL or with another person
which (but for this Clause 9.4) might operate to diminish or discharge
the liability of or otherwise provide a defence to a surety.
9.5 Without affecting the generality of Clause 9.4, a Seller may at any time
it thinks fit and without reference to Vernalis and without prejudice to
Vernalis's obligations under this Clause 9.1:
9.5.1 grant a time for payment or grant another indulgence or agree
to an amendment, variation, waiver or release in respect of an
obligation of VDL under this Agreement or the Transitional
Services Agreement;
9.5.2 give up, deal with, vary, exchange or abstain from perfecting
or enforcing other securities or guarantees held by such
Seller;
9.5.3 discharge a party to other securities or guarantees held by
such Seller and realise all or any of those securities or
guarantees; and
9.5.4 compound with, accept compositions from and make other
arrangements with VDL or a person or persons liable on other
securities or guarantees held or to be held by such Seller.
9.6 So long as VDL is under an actual or contingent obligation under this
Agreement or the Transitional Services Agreement Vernalis shall not
exercise a right which it may at any time have by reason of the
performance of its obligations under Clauses 9.1 and 9.2 to be
indemnified by VDL, to claim a contribution from another surety of VDL's
obligations or to take the benefit (wholly or partly and by way of
subrogation or otherwise) of any of VDL's rights under this Agreement or
the Transitional Services Agreement or of any other security taken by
VDL in connection with this Agreement or the Transitional Services
Agreement.
9.7 Vernalis's liabilities under Clauses 9.1 and 9.2 are not affected by the
avoidance of an assurance, security or payment or a release, settlement
or discharge which is given or made on the faith of an assurance,
security or payment, in either case, under an enactment relating to
bankruptcy or insolvency.
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9.8 Vernalis waives any right it may have of first requiring a Seller (or
any trustee or agent on its behalf) to proceed against or enforce any
other rights or security or claim payment from any person before
claiming from Vernalis under this Clause 9. This waiver applies
irrespective of any law or any provision of this Agreement or any
agreement entered into pursuant to this Agreement to the contrary.
10. TRANSFER OF THE PRODUCT REGISTRATIONS
10.1 At Completion, EPI shall transfer the Product Registrations to VDL free
from any Encumbrance on the terms of and in accordance with this
Clause 10.
10.2 At or without delay following Completion, EPI shall deliver the signed
transfer letters in the agreed form to the FDA or Health Canada (as the
case may be) or other notice, application, submission, report and other
instrument, document, correspondence or filing presented to it by VDL
that is necessary for the transfer of the Product Registrations to VDL.
10.3 Save insofar as they arise from EPI's failure to comply with Clause 10.1
of this Agreement or its obligations under the Transitional Services
Agreement, VDL hereby indemnifies each Elan Group Undertaking on demand
against any liability, loss, damage, cost or expense of any nature
suffered by any Elan Group Undertaking arising out of any breach by VDL
of its regulatory responsibility as the transferee. Each Elan Group
Undertaking may enforce the terms of this Clause 10.3 subject to and in
accordance with the provisions of the Contracts (Rights of Third
Parties) Xxx 0000.
10.4 No Seller shall have any further or other obligations with respect to
the transfer of the Product Registrations to VDL and the maintenance of
the Product Registrations after Completion except as expressly set out
in this Clause 10 or the Transitional Services Agreement.
11. USE OF ELAN NAME
11.1 Vernalis acknowledges and agrees that nothing in this Agreement shall
operate as an agreement to transfer (nor shall transfer) any right,
title or interest in the name and xxxx 'Elan', the Elan group corporate
logo or any name or xxxx including or comprising 'Elan' (including,
without limitation, as part of any of the corporate or trading names of
any Elan Group Undertaking) and the stylised "e" symbol currently
debossed on the Product and reproduced in Schedule 10 (the ""E" SYMBOL")
(the "XXXX XXXXX") or in any other name, xxxx, logo or trading insignia
of the Sellers or any other Elan Group Undertaking other than the Trade
Marks. This Agreement does not entitle Vernalis or any Vernalis Group
Undertaking to use any Xxxx Xxxxx or any such other name, xxxx, logo or
trading insignia save for the entitlement expressly conferred on
Vernalis in this Clause 11.
11.2 EPI (on behalf of itself and as agent for each Elan Group Undertaking)
grants to VDL, subject to the terms of this Clause 11, a royalty-free,
non-exclusive, non-sub-licensable and non-assignable licence to use (a)
the Xxxx Xxxxx (other than the "e" Symbol") on Marketing Materials for a
period of six months from Completion in connection with the sale and
distribution of the Product (including, for the avoidance of doubt, the
Stock), provided that in relation to the Stock marked with Xxxx Xxxxx
handed over at Completion such period shall be nine months from
Completion and (b) the "e" Symbol
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on the Product for a period of 24 months from Completion in the United
States by VDL in the manner and for the purpose for which the Xxxx Xxxxx
were used (if at all) in connection with the manufacture, sale and
distribution of the Product in the United States during the six months
before Completion, provided that Vernalis shall use all reasonable
endeavours to cease all use of the Xxxx Xxxxx as soon as reasonably
practicable after Completion.
11.3 Vernalis shall, no later than one month after the licences described in
Clause 11.2 terminate for any reason, destroy all existing stocks,
packaging, sales literature, stationery and marketing materials (in
documentary form) bearing any Elan Xxxx (and delete the same from any
template or design therefore) and remove the "e" Symbol from all
equipment used to xxxx the Product.
11.4 VDL shall:
11.4.1 not use any of the Xxxx Xxxxx in any modified or altered form,
or with any prefix or suffix or in any other language, or as
part of, or in combination, conjunction or association with,
any other name or xxxx, save for any xxxx including or
consisting of the name and xxxx "Frova";
11.4.2 not do, or cause to be done, anything which may in any way
damage, depreciate, tarnish, jeopardise or otherwise prejudice
the goodwill and reputation associated with the Xxxx Xxxxx;
11.4.3 not knowingly do anything that may jeopardise the
enforceability or validity of any registration of any Elan
Xxxx or lead to grounds for the revocation of any such
registration for any reason including, but not limited to, use
of any Elan Xxxx in a manner which may be misleading to the
public;
11.4.4 use the Xxxx Xxxxx only in connection with the Stock or a
Product complying with the quality and other specifications of
the Product Registrations;
11.4.5 comply with all reasonable written directions from EPI from
time to time regarding use of the Xxxx Xxxxx under this Clause
11;
11.4.6 not apply to register any Elan Xxxx as a trade xxxx based upon
its use of the Xxxx Xxxxx under this Clause 11, or otherwise
at any time; and
11.4.7 not use in connection with the Product any other trade xxxx or
trade name which is confusingly similar to any of the Xxxx
Xxxxx.
11.5 Vernalis shall have no entitlement to, or to call upon a Seller or any
Elan Group Undertaking to, bring proceedings or take any action against
any person infringing or suspected of infringing any rights of any Elan
Group Undertaking in any of the Xxxx Xxxxx, and Vernalis hereby
irrevocably waives any such entitlement that may be bestowed upon
Vernalis by operation of any law.
11.6 Vernalis acknowledges and agrees and understands that all rights and
goodwill arising from all use of the Xxxx Xxxxx by Vernalis under this
Clause 11 shall enure solely to the benefit of the Sellers (or the
relevant Elan Group Undertaking). On termination or
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expiry of the licence granted in Clause 11.2 (howsoever arising),
Vernalis shall, if so requested by EPI, execute an assignment in favour
of EPI (or such other person as EPI may direct) of all goodwill
associated with the Xxxx Xxxxx that may have accrued to Vernalis by
reason of its use of the Xxxx Xxxxx.
11.7 The licence granted in Clause 11.2 shall not be terminable or revocable
save for material breach by Vernalis of the provisions of this Clause 11
or save further if Vernalis or other Vernalis Group Undertaking opposes
or challenges the validity or grant of any registration of, or
application for, any of the Xxxx Xxxxx. In the event of termination of
the licence, Vernalis shall immediately cease using any of the Xxxx
Xxxxx.
11.8 For the avoidance of any doubt, the Sellers give no warranty and make no
representation that the use of the Xxxx Xxxxx by Vernalis will not
infringe the Intellectual Property of any third party.
11.9 Vernalis hereby indemnifies the Sellers against any liability, loss,
damage, cost or expense of any nature (including professional charges
and including damage to goodwill or reputation and the costs of
mitigation) reasonably incurred by the Sellers or any Elan Group
Undertaking whether direct or consequential (including, but not limited
to, any economic loss or other loss of profits, business or goodwill or
with respect to any product liability claim) arising out use of the Xxxx
Xxxxx by Vernalis under this Clause 11.
11.10 Nothing in Clauses 11.2 and 11.3 shall require Vernalis or any Vernalis
Group Undertaking to take any steps to remove the Xxxx Xxxxx from any
Product or any packaging or materials connected with the Product that
have already entered the distribution chain, save as required by law.
12. CONTRACTS
12.1 Subject to Clause 12.3.3 and the Transitional Services Agreement, after
Completion VDL shall:
12.1.1 perform all of the obligations of each Seller to be performed
after Completion under each Contract to which it is a party
solely insofar as it relates to the Compound and/or the
Product (as the case may be) (other than payment of the Trade
Credits) in accordance with the terms of the Contract; and
12.1.2 indemnify, and keep indemnified, each Seller on demand against
each loss, liability and cost which any such Seller incurs as
a result of any breach of Vernalis's obligations under Clause
12.1.1 (including, without limitation, each loss, liability
and cost incurred as a result of defending or settling a claim
alleging such a liability).
12.2 The Sellers shall indemnify, and keep indemnified, each Vernalis Group
Undertaking against each loss, liability and cost which any such
Vernalis Group Undertaking incurs as a result of each Seller's
performance of its obligations under each Contract to which it is a
party to the extent that the loss, liability or cost is attributable to
such Seller's act or omission before Completion (including, without
limitation, each loss, liability and cost incurred as a result of
defending or settling a claim alleging such a liability).
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12.3 If a Residual Contract cannot be transferred to VDL except by an
assignment made with a specified person's consent or by a novation
agreement:
12.3.1 this Agreement does not constitute an assignment or an
attempted assignment of such Residual Contract if an
assignment or attempted assignment would constitute a breach
of such Residual Contract;
12.3.2 both before and after Completion VDL and the Seller which is a
party to such Residual Contract shall each make all reasonable
efforts to obtain the person's consent to the assignment, or
achieve the novation, of such Residual Contract solely insofar
as it relates to the Compound and/or the Product (as the case
may be);
12.3.3 until the consent is obtained or novation is achieved, the
Seller which is a party to such Residual Contract shall, at
VDL's sole cost and risk, do each act and thing reasonably
requested of it by VDL to enable performance of such Residual
Contract solely insofar as it relates to the Compound and/or
the Product (as the case may be) and to provide for Vernalis
the benefits of those parts of such Residual Contract
(including, without limitation, enforcement of a right of such
Seller against another party to the Residual Contract arising
out of its termination by the other party or otherwise); and
12.3.4 until the consent is obtained or novation is achieved, the
Seller which is a party to such Residual Contract shall hold
the benefit of such Residual Contract solely insofar as it
relates to the Compound and/or the Product (as the case may
be) on trust for VDL.
13. LIABILITIES AND APPORTIONMENTS
13.1 Subject to Clause 14 and Schedule 8, each Seller shall:
13.1.1 remain responsible for the Trade Credits owed by it; and
13.1.2 indemnify, and keep indemnified, VDL on demand against each
loss, liability and cost which VDL incurs as a result of such
Seller's failure to comply with its obligations under Clause
13.1.1 including, without limitation, each loss, liability or
cost incurred as a result of defending or settling a claim
alleging such a liability but excluding any liability of VDL
arising under this Agreement.
13.2 Subject to Clause 14 and Schedule 8, VDL:
13.2.1 is responsible for all liabilities incurred in connection with
the Assets after Completion or the sale, marketing,
distribution or supply of the Product after Completion
including, without limitation, all outgoings and expenses owed
in connection with the Assets after Completion;
13.2.2 shall indemnify, and keep indemnified, each Seller on demand
against each loss, liability and cost which such Seller incurs
as a result of VDL's failure to comply with its obligations
under Clause 13.2.1 and against any liability arising out of
or in connection with the ownership or operation of the Assets
after
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Completion, including, without limitation, each loss,
liability or cost of the sale, marketing, distribution or
supply of the Product incurred as a result of defending or
settling a claim alleging such a liability but excluding any
liability of a Seller arising under this Agreement.
13.3 If a payment (not including any outgoings or expenses, or any part of
any outgoings or expenses, which represents VAT) under a Contract for a
period covering both before and after Completion is made by:
13.3.1 a Seller, Vernalis shall pay such Seller an amount equal to
that proportion of the payment that relates to the period
after Completion; or
13.3.2 Vernalis, the Seller which is a party to such Contract shall
pay Vernalis an amount equal to that proportion of the payment
that relates to the period before the Completion.
13.4 If a payment (not including any payment, or any part of any payment,
which represents VAT) under a Contract for a period covering both before
and after Completion is received by:
13.4.1 a Seller, such Seller is entitled to retain the proportion of
the payment that relates to the period before Completion and
shall pay Vernalis an amount equal to the remainder; or
13.4.2 Vernalis, Vernalis is entitled to retain the proportion of the
payment that relates to the period after Completion and shall
pay the Seller which is a party to such Contract an amount
equal to the remainder.
13.5 A party owing an amount under Clause 13.3 or 13.4 shall pay the other
party that amount within 14 days of payment of receipt (as the case may
be).
14. RETURNS REBATES AND CHARGEBACKS
The parties agree that the provisions of Schedule 8 will apply after
Completion.
15. VALUE ADDED TAX
15.1 All sums payable by VDL or Vernalis to a Seller pursuant to this
Agreement shall be deemed to be exclusive of any VAT which may be
chargeable on the supply or supplies for which such sums (or any part
thereof) are the whole or part of the consideration for VAT purposes.
15.2 Where, pursuant to the terms of this Agreement, a Seller makes a supply
to VDL or Vernalis for VAT purposes and VAT is or becomes chargeable on
such supply, VDL or Vernalis (as the case may be) shall pay to such
Seller (in addition to and at the same time as providing any other
consideration for such supply or, if later, within five Business Days
following the delivery by such Seller to VDL or Vernalis (as the case
may be) of a valid VAT invoice) a sum equal to the amount of VAT which
is or becomes chargeable on such supply and for which such Seller has
the liability to account to a tax authority.
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15.3 Where a party (the "PAYING PARTY") is required by the terms of this
Agreement to reimburse the other party (the "RECIPIENT") for any cost or
expense, the Paying Party shall reimburse the Recipient for the full
amount of such cost or expense, including such part thereof as
represents VAT, save to the extent that the Recipient obtains credit or
repayment in respect of such VAT from a tax authority.
16. POST COMPLETION OBLIGATIONS
16.1 EPI hereby agrees to use its reasonable endeavours to procure from UCB
as soon as possible after Completion an assignment to VDL (whether
directly from UCB or indirectly via EPI) of all of UCB's rights, title
and interest (if any) in any copyright and other Intellectual Property
subsisting in the Marketing Materials.
16.2 If, following Completion, any party discovers that a Seller owns any
Intellectual Property which:
16.2.1 was before Completion used exclusively for; and
16.2.2 is necessary for,
the promotion, marketing, distribution, sale or supply of the Product,
such Seller shall, at VDL's request, assign to VDL at such Seller's
cost, that Seller's right, title and interest in such Intellectual
Property, provided that such assignment is not prohibited by any prior
agreement. In that case, that Seller shall use its reasonable endeavours
to obtain consent to such assignment or a novation in favour of VDL (as
appropriate).
16.3 Vernalis shall procure that before any Vernalis Group Undertaking or
other affiliate of Vernalis (other than VDL) enters into any arrangement
which might give rise to a Monetary Claim (as defined in the Floating
Charge) if such entity were VDL, such entity shall execute and deliver
to EPIL a floating charge in EPIL's favour in the same form as the
Floating Charge.
16.4 On or after Completion the Sellers shall, at their own cost and expense,
execute and do (or procure to be executed and done by any other
necessary Elan Group Undertaking) all such deeds, documents, acts and
things as VDL may from time to time reasonably require in order to vest
any of the Assets in VDL (including taking reasonable steps within their
power to vest the Equipment in VDL with full title guarantee) or as
otherwise may be necessary to give full effect to this Agreement.
16.5 Each party shall immediately give to the other all payments, notices,
correspondence, information or enquiries in relation to the Business or
the Assets which it receives after Completion and which belong to the
other.
17. FURTHER UNDERTAKINGS BY THE SELLERS
17.1 In this Clause 17:
17.1.1 "SIMILAR COMPETING PRODUCT" means a pharmaceutical product
which contains any of the serotonin receptor agonists known as
"triptans" as agents for the treatment of migraine; and
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17.1.2 "DIRECTLY COMPETING PRODUCT" means a pharmaceutical product
which contains the Compound (or a compound which is
substantially the same as the Compound (including a chiral
isomer of the Compound)) as its active pharmaceutical
ingredient.
17.2 Each Seller undertakes to Vernalis that such Seller will not, for a
period up to and including 31 December 2005, be concerned in any
business which promotes, markets, distributes, sells or supplies:
17.2.1 a Similar Competing Product in the Territory; or
17.2.2 a Directly Competing Product in any member state of the
European Union or Japan ("EUROPE").
17.3 The Sellers shall ensure that each Elan Group Undertaking complies with
Clause 17.2.
17.4 For the purposes of Clauses 17.2 and 17.3, a Seller or other Elan Group
Undertaking is concerned in a business if carries it on as principal or
agent or if:
17.4.1 it is a partner, director or agent in, of or to any person who
carries on the business; or
17.4.2 it has any direct or indirect financial interest (as
shareholder or otherwise) in any person who carries on the
business; or
17.4.3 it is a partner, director or agent in, of or to any person who
has a direct or indirect financial interest (as shareholder or
otherwise) in any person who carries on the business.
17.5 Nothing in this Clause 17 shall:
17.5.1 restrict all Elan Group Undertakings from together being
interested in securities which amount to less than five per
cent. of the issued securities of that class of any entity
which promotes, markets, distributes, sells or supplies a
Similar Competing Product in the Territory or a Directly
Competing Product in Europe provided that no Elan Group
Undertaking is involved in the management of the business of
the issuer of the securities other than by the exercise of
voting rights attaching to the securities; or
17.5.2 prevent any Elan Group Undertaking from acquiring one or more
businesses and/or companies (together the "ACQUIRED ASSETS")
which promote, market, distribute, sell or supply a Similar
Competing Product in the Territory or a Directly Competing
Product in Europe provided that either:
(a) the turnover in the Territory of all Similar Competing
Products acquired plus the turnover in Europe of all
Directly Competing Products acquired (together, the
"COMPETING TURNOVER") is less than 10 per cent. of the
turnover attributable to the Acquired Assets (including
all Similar Competing Products and Directly Competing
Products); or
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(b) such Elan Group Undertaking disposes, within one year of
their being acquired, of sufficient Acquired Assets to
bring Competing Turnover below 10 per cent of the
turnover attributable to the Acquired Assets (including
all Similar Competing Products and Directly Competing
Products).
17.6 If the restriction in Clause 17.2 is void but would be valid if some
part of the restriction were deleted, the restriction shall apply with
such modification as may be necessary to make it valid.
17.7 Each Seller acknowledges that the above provisions of this Clause 17 are
no more extensive than is reasonable to protect VDL as the purchaser of
the Assets.
18. RECORDS AND ASSISTANCE
18.1 As soon as practical following Completion (and, in any event, no later
than three months after Completion), the Sellers shall deliver to
Vernalis the Delivered Records other than those required by the Elan
Companies (as defined in the Transitional Services Agreement) to
discharge their obligations under the Transitional Services Agreement
(the "TRANSITIONAL SERVICE Records"). The Sellers shall deliver the
Transitional Service Records to Vernalis as soon as is reasonably
practicable following termination of the Transitional Services
Agreement. The provisions of Clause 18.2 shall apply, mutatis mutandis,
in relation to the Transitional Service Records until they are delivered
to Vernalis. The Sellers shall be entitled to retain one copy of the
Delivered Records.
18.2 The Sellers shall retain the Retained Records following Completion and
shall allow Vernalis, its employees and agents and any other person
authorised by Vernalis (subject to the provisions of Clauses 18.5 and
20):
18.2.1 on reasonable notice to inspect (at all reasonable times
during usual business hours) such of the Retained Records as
it may reasonably request in connection with the Assets
(which, for the avoidance of doubt, shall not include any of
the records described in sub-paragraphs (c), (e), (f), (g),
(h), (i) and (m) of the definition of Retained Records); and
18.2.2 at Vernalis's cost, to take copies of any of those Retained
Records.
18.3 Following Completion, Vernalis shall allow the Sellers, their employees
and agents and any other person authorised by a Seller (subject to the
provisions of Clauses 18.4 and 20):
18.3.1 on reasonable notice to inspect the Delivered Records at all
reasonable times during usual business hours; and
18.3.2 at the Sellers' cost, to take copies of any of the Delivered
Records.
18.4 Vernalis shall procure that a Vernalis Group Undertaking maintains all
Delivered Records for a period of ten years after Completion.
Thereafter, Vernalis shall give the Sellers 90 days' written notice of
its intention to dispose of any Delivered Records. A
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Seller may elect to remove, at its cost, any or all of the Delivered
Records during such 90 day period.
18.5 The Sellers shall procure that an Elan Group Undertaking maintains all
Retained Records for a period of ten years after Completion. Thereafter,
EPI shall give Vernalis 90 days' written notice of any intention to
dispose of any Retained Records. Vernalis may elect to remove, at its
cost, during such 90 day period, such of the Retained Records as it may
reasonably require in connection with the Assets (which, for the
avoidance of doubt, shall not include any of the records described in
sub-paragraphs (c), (e), (f), (g), (h), (i) and (m) of the definition of
Retained Records).
18.6 To facilitate the resolution of any Parent Proceeding, following
Completion and upon reasonable notice, Vernalis shall (in each case at
the Sellers' sole cost):
18.6.1 to the extent that an Elan Group Undertaking is legally
required to produce original documents for inspection in a
Parent Proceeding, cooperate with such Elan Group Undertaking
in making such original documents available for inspection by
parties to such Parent Proceeding;
18.6.2 insofar as it is able, furnish to the Seller, their employees
and agents and any other person authorised by a Seller, such
additional financial and other information regarding any Elan
Group Undertaking relating to the period prior to Completion
as any Elan Group Undertaking may from time to time reasonably
request; and
18.6.3 make available to any Elan Group Undertaking, its employees
and agents and any other person authorised by a Seller, all
its employees (from time to time) whose assistance, testimony
or presence is necessary to assist such Elan Group Undertaking
in evaluating any such claims and/or in defending against such
claims, including the presence of such persons as witnesses in
hearings or trials for such purposes, provided that the
foregoing shall not unreasonably interfere with the business
or operations of any Vernalis Group Undertaking.
Each Elan Group Undertaking may enforce the terms of this Clause 18.6
subject to and in accordance with the provisions of the Contracts
(Rights of Third Parties) Xxx 0000.
18.7 In respect of any Retained Record that is an invention record or related
document in respect of the Registered Trade Marks, in any form, the
Sellers shall use their reasonable endeavours to locate and provide a
copy of any relevant part of such Retained Record if and to the extent
reasonably requested by Vernalis for the purposes of the defence of any
opposition, interference or other claim attacking the validity of any of
the Registered Trade Marks.
18.8 Vernalis (on behalf of itself and as agent for each Vernalis Group
Undertaking) hereby grants the Sellers a royalty-free, non-exclusive,
irrevocable, worldwide and non-terminable licence under all Copyright
and all its right, title and interest in other Intellectual Property
subsisting in the Delivered Records solely to reproduce copies of the
Delivered Records retained by the Sellers pursuant to Clause 18.1 and to
use such reproductions.
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19. LEGAL DISCLOSURE
19.1 Vernalis acknowledges that it has been informed that information
regarding the Elan Group Undertakings has been requested by the United
States Securities and Exchange Commission (the "SEC") and by private
litigants in connection with Parent Proceedings. Vernalis waives any
right that it may have to notice or consultation in relation to the
disclosure of any of the Retained Records or any other information that
has been (or may be) requested by the SEC and/or private litigants in
connection with the Parent Proceedings.
19.2 Notwithstanding Clause 20, each Elan Group Undertaking:
19.2.1 shall be permitted to use any information as is referred to in
Clauses 20.1 and 20.2 as required by any law, rule,
regulation, order, decree, injunction or judgment of any
federal, state, local or foreign court, legislative body,
administrative agency, commission or other governmental or
regulatory authority; and
19.2.2 may disclose any information as is referred to in Clause 20.2
to any employee, agent, attorney, accountant, consultant or
representative or other adviser in connection with the
prosecution or defence of any Parent Proceeding and may use
any such information that it believes to be necessary or
desirable for purposes of prosecuting or defending a Parent
Proceeding, provided, however, that such Elan Group
Undertaking will use its reasonable efforts to obtain an order
protecting the confidentiality of such information.
20. CONFIDENTIAL INFORMATION
20.1 Subject to Clause 20.3, each Seller undertakes to Vernalis that before
and after Completion such Seller shall:
20.1.1 not use or disclose to a person Confidential Information it
has or acquires (except to the extent necessary in the
ordinary course of marketing, distribution and sale of the
Product prior to Completion);
20.1.2 make every effort to prevent the use or disclosure of
Confidential Information (except as mentioned in Clause
20.1.1); and
20.1.3 procure that each Elan Group Undertaking complies with Clauses
20.1.1 and 20.1.2.
20.2 Subject to Clause 20.3 and Clause 21, each Seller undertakes to
Vernalis, for itself and as agent and trustee for each Vernalis Group
Undertaking, and Vernalis undertakes to each Seller, for itself and as
agent and trustee for each other Elan Group Undertaking, that it shall
treat as confidential all information received or obtained as a result
of entering into or performing this Agreement which relates to:
20.2.1 the other party including, where that other party is a Seller,
each Elan Group Undertaking and where that other party is
Vernalis, each Vernalis Group Undertaking;
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20.2.2 the provisions or the subject matter of this Agreement or any
document referred to herein and any claim or potential claim
thereunder; or
20.2.3 the negotiations relating to this Agreement or any documents
referred to herein.
Each Seller shall procure that each Elan Group Undertaking complies with
this Clause 20.2 and Vernalis shall procure that each Vernalis Group
Undertaking complies with this Clause 20.2
20.3 Clauses 20.1 and 20.2 do not apply to disclosure of information:
20.3.1 to a director, officer or employee of a Elan Group Undertaking
or a Vernalis Group Undertaking whose function requires him to
have such information;
20.3.2 required to be disclosed by law, by a rule of a listing
authority or stock exchange by or on which Elan Corp's shares
or Vernalis's shares are listed or traded, or by a
governmental or regulatory authority or other authority with
relevant powers to which an Elan Group Undertaking or a
Vernalis Group Undertaking is subject or submits, whether or
not the requirement has the force of law, provided that the
disclosure shall so far as is practicable be made after
consultation with the other parties and after taking into
account the reasonable requirements of the other parties as to
its timing, content and manner of making or despatch;
20.3.3 to an agent, attorney, accountant, consultant, representative
or other adviser provided that such disclosure is reasonably
necessary and is on the basis that Clauses 20.1 and 20.2 apply
to use and disclosure by the adviser; or
20.3.4 that is or becomes in the public domain other than as a result
of the breach of a confidentiality obligation by the party
making the disclosure.
21. ANNOUNCEMENTS
21.1 Subject to Clause 21.2, neither party may, before or after Completion,
make or send a public announcement, communication or circular concerning
the transactions referred to in this Agreement unless it has first
obtained the other party's written consent, which may not be
unreasonably withheld or delayed.
21.2 Clause 21.1 does not apply to the posting of the Circular by Vernalis
nor to a public announcement, communication or circular:
21.2.1 made or sent by Vernalis after Completion to a customer or
supplier of the Product informing it of Vernalis's purchase of
the Assets; or
21.2.2 required by law, by a rule of a listing authority or stock
exchange by or on which Elan Corp's or Vernalis's shares are
listed or traded, or by a governmental or regulatory authority
or other authority with relevant powers to which an Elan Group
Undertaking or a Vernalis Group Undertaking is subject or
submits, whether or not the requirement has the force of law,
provided that the public announcement, communication or
circular shall so far as is practicable be made after
consultation with the other parties and after taking into
account the
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reasonable requirements of the other parties as to its timing,
content and manner of making or despatch.
22. COSTS
22.1 Except where this Agreement or the relevant document provides otherwise,
each party shall pay its own costs relating to the negotiation,
preparation, execution and performance by it of this Agreement and of
each document referred to in it.
22.2 VDL shall pay, or shall procure the payment by a Vernalis Group
Undertaking of, any stamp duty, transfer, notarial or registration taxes
or any taxes of a similar fiscal nature and arising in any jurisdiction
whatsoever which are payable in respect of this Agreement, or any
document executed pursuant to this Agreement, pursuant to which any
estate, interest or title is transferred or otherwise vested in VDL or a
Vernalis Group Undertaking.
23. SET OFF
23.1 In the event of there being an Elan Payable Amount, it shall be dealt
with as follows:
23.1.1 first in reducing, by the amount of the Elan Payable Amount,
the sum payable by VDL pursuant to Clause 5.3 (the "STOCK
PAYMENT");
23.1.2 next (if applicable) in reducing, by the amount of the Elan
Payable Amount less the amount of the Stock Payment, the sum
payable by VDL pursuant to Clause 5.4;
23.1.3 next (if applicable) in reducing, by the amount of the Elan
Payable Amount less the aggregate of $20,000,000 and the
amount of the Stock Payment, the sum payable by VDL pursuant
to Clause 5.5; and
23.1.4 finally (if applicable) by Elan or the relevant Elan Group
Undertaking paying the balance (or the entirety as the case
may be) of the Elan Payable Amount to VDL.
23.2 In the event of there being a Vernalis Payable Amount this may only be
set off against an Elan Payable Amount and to the extent that this is
not possible it shall be paid in full.
24. INDEMNIFICATION
24.1 If a party (the "INDEMNIFIED PARTY") becomes aware of a matter which
might give rise to a claim for indemnification under this Agreement:
24.1.1 the Indemnified Party shall notify the party which has given
the indemnity (the "INDEMNIFIER") immediately of the matter
(stating in reasonable detail the nature of the matter and, if
practicable, the amount claimed) and consult with the
Indemnifier with respect to the matter; if the matter has
become the subject of proceedings the Indemnified Party shall
notify the Indemnifier within sufficient time to enable the
Indemnifier to have time to contest the proceedings before
final judgment;
24.1.2 the Indemnified Party shall:
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(a) take any action and institute any proceedings, and give
any information and assistance, as the Indemnifier or
its insurers may reasonably request to:
(i) dispute, resist, appeal, compromise, defend,
remedy or mitigate the matter; or
(ii) enforce against a person (other than the
Indemnifier) the Indemnified Party's or its
insurers' rights in relation to the matter; and
(b) in connection with proceedings related to the matter
(other than against the Indemnifier) use advisers chosen
by the Indemnifier or its insurers and, if the
Indemnifier requests, allow the Indemnifier or its
insurers the exclusive conduct of the proceedings,
in each case if the Indemnifier indemnifies the Indemnified
Party for all reasonable costs incurred as a result of a
request or choice by the Indemnifier or its insurers;
24.1.3 the Indemnified Party may only admit liability in respect of
or settle the matter if it has first obtained the
Indemnifier's written consent (not to be unreasonably withheld
or delayed).
25. GENERAL
25.1 A variation of this Agreement is valid only if it is in writing and
signed by or on behalf of each party.
25.2 The failure to exercise or delay in exercising a right or remedy
provided by this Agreement or by law does not impair or constitute a
waiver of the right or remedy or an impairment of or a waiver of other
rights or remedies. No single or partial exercise of a right or remedy
provided by this Agreement or by law prevents further exercise of the
right or remedy or the exercise of another right or remedy.
25.3 Each party's rights and remedies contained in this Agreement are
cumulative and not exclusive of rights or remedies provided by law.
25.4 Except to the extent that they have been performed and except where this
Agreement provides otherwise, the obligations contained in this
Agreement remain in force after Completion.
25.5 If a party fails to pay a sum due from it under this Agreement on the
due date of payment in accordance with the provisions of this Agreement,
that party shall pay interest on the overdue sum from the due date of
payment until the date on which its obligation to pay the sum is
discharged at the rate of 2 per cent. above the base rate from time to
time of Barclays Bank plc (whether before or after judgment). Interest
accrues and is payable from day to day.
25.6 If any payment under any Clause requiring one party (the "PAYER") to
indemnify or compensate another party (the "PAYEE") will be or has been
subject to Tax, the Payer
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shall on demand from the Payee pay to the Payee the amount (after taking
into account Tax payable in respect of the amount) that will ensure that
the Payee receives and retains a net sum equal to the sum it would have
received had the payment not been subject to Tax.
25.7 Except as provided in Clauses 2.1, 2.3, 2.4, 10.3, 18.6 and 26.7, a
person who is not a party to this Agreement has no right under the
Contracts (Rights of Third Parties) Xxx 0000 to enforce any term of this
Agreement, but this does not affect any right or remedy of a third party
which exists or is available apart from that Act.
25.8 The Sellers' obligations under this Agreement are joint and several.
26. ENTIRE AGREEMENT
26.1 In this Clause 26, "REPRESENTATION" means representation, statement,
assurance, covenant, undertaking, indemnity, guarantee or commitment
(whether contractual or otherwise).
26.2 This Agreement and each document referred to in it constitute the entire
agreement and supersede any previous agreement between the parties
relating to the subject matter of this Agreement (except as provided in
Clause 2.1).
26.3 Vernalis acknowledges and represents that it has not relied on or been
induced to enter into this Agreement by a Representation given by any
Elan Group Undertaking or any adviser to the Sellers other than the
Warranties or otherwise as set out in this Agreement or each document
referred to in it.
26.4 No Elan Group Undertaking is liable to Vernalis for a Representation
that is not set out in this Agreement or any document referred to in
this Agreement.
26.5 Each Seller acknowledges and represents that it has not relied on or
been induced to enter into this Agreement by a Representation given by
any Vernalis Group Undertaking or any adviser to Vernalis other than as
set out in this Agreement.
26.6 No Vernalis Group Undertaking is liable to the Sellers for a
Representation that is not set out in this Agreement or any document
referred to in this Agreement.
26.7 Each party agrees that no adviser or provider of finance to any other
party shall have any liability to the first party for a Representation
that is not set out in this Agreement or any document referred to in
this Agreement. Any such adviser or provider of finance may enforce the
terms of this Clause 26.7 subject to and in accordance with the
provisions of the Contracts (Rights of Third Parties) Xxx 0000.
26.8 Nothing in this Clause 26 shall have the effect of limiting or
restricting any liability arising as a result of any fraud, wilful
misconduct or wilful concealment.
27. ASSIGNMENT
27.1 Each of Vernalis and VDL may assign its rights under this Agreement to
any Vernalis Group Undertaking without the consent of any other party
and if it does so:
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27.1.1 as between the parties, each other party may nevertheless
enforce this Agreement against the assignor as if that
assignment had not occurred; and
27.1.2 if the assignee was originally, but subsequently ceases to be
a Vernalis Group Undertaking, the assignor shall procure that
the rights under this agreement are reassigned to the assignor
or another Vernalis Group Undertaking.
27.2 Each of Vernalis and VDL may assign the benefit of each of the
obligations on the part of the Sellers under this Agreement to any
financial institution providing debt financing to any Vernalis Group
Undertaking or to any security agent or any person or persons acting as
trustee, nominee or agent for any such financial institution or security
agent by way of security for the facilities being made available to the
Vernalis Group Undertaking.
27.3 Each Seller may assign its rights under this Agreement to any Elan Group
Undertaking without the consent of any other party and if it does so:
27.3.1 each other party may nevertheless enforce this Agreement
against the assignor as if that assignment had not occurred;
and
27.3.2 if the assignee was originally, but subsequently ceases to be
an Elan Group Undertaking, the assignor shall procure that the
rights under this agreement are reassigned to the assignor or
another Elan Group Undertaking.
27.4 No party shall be liable to make any payment to any assignee of any
other party which it would not have been liable to make to the assignor
but for any assignment.
27.5 Except as permitted by this Xxxxxx 00, xxxx of the rights or obligations
under this Agreement may be assigned or transferred without the prior
written consent of the other parties.
28. NOTICES
28.1 A notice or other communication under or in connection with this
Agreement (a "NOTICE") shall be:
28.1.1 in writing; and
28.1.2 delivered personally or sent by first class post delivery (and
air mail if overseas) or by fax to the party due to receive
the Notice to the address set out in Clause 28.3 or to another
address, person or fax number specified by that party by
written notice to the other parties received before the Notice
was despatched.
28.2 Unless there is evidence that it was received earlier, a Notice is
deemed given if:
28.2.1 delivered personally, when left at the address referred to in
Clause 28.1.2;
28.2.2 sent by mail, except air mail, two Business Days after posting
it;
28.2.3 sent by air mail, six Business Days after posting it; and
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28.2.4 sent by fax, when confirmation of its transmission has been
recorded by the sender's fax machine.
28.3 The address referred to in Clause 28.1.2 is:
28.3.1 in the case of Elan Corp and EPIL:
c/o Elan International Services, Ltd
000 Xx Xxxxx Xxxxx
Xxxxxx, Xxxxxx XX00
Bermuda
Fax: + 0 000 000 0000
Attention: Director;
28.3.2 in the case of EPI:
000 Xxxxxxx Xxxxxxxxx,
Xxxxx Xxx Xxxxxxxxx
XX 00000
Xxxxxx Xxxxxx of America
Fax: + 0 000 000 0000
Attention: General Counsel; and
28.3.3 in the case of Vernalis or VDL:
Oakdene Court
000 Xxxxxxx Xxxx
Xxxxxxxx
Xxxxxxxxx XX00 0XX
Xxxxxx Xxxxxxx
Fax: x00 000 000 0000
Attention: Company Secretary.
29. GOVERNING LAW AND JURISDICTION
29.1 This Agreement is governed by English law.
29.2 The courts of England have exclusive jurisdiction to settle any dispute
arising from or connected with this Agreement (a "DISPUTE") including a
dispute regarding the existence, validity or termination of this
Agreement or the consequences of its nullity.
29.3 The parties agree that the courts of England are the most appropriate
and convenient courts to settle any Dispute and, accordingly, that they
will not argue to the contrary.
29.4 The parties agree that the documents which start any proceedings
relating to a Dispute ("PROCEEDINGS") and any other documents required
to be served in relation to those Proceedings may be served on any
Seller in accordance with Clause 28. These documents may, however, be
served in any other manner allowed by law.
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30. COUNTERPARTS
This Agreement may be executed in any number of counterparts, each of
which when executed and delivered is an original and all of which
together evidence the same agreement.
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SCHEDULE 1
PURCHASE PRICE
ASSET PURCHASE PRICE
----- --------------
The Contracts $ 5,000
The IP Assets $ 50,000
The Equipment $ 50,000
The Delivered Records $ 50,000
--------
TOTAL $155,000
========
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SCHEDULE 2
COMPLETION STATEMENT
1. After Completion Vernalis shall (at its cost) ensure that Vernalis's
Accountants prepare a statement (in the form of paragraph 2) (the
"INITIAL STATEMENT") specifying the amount of the Stock and the Actual
Stock Value valued in accordance with paragraph 2.
2. The form of the Initial Statement (incorporating the values for different
types of Stock) is as follows:
OWNED OWNED BY TOTAL
DESCRIPTION OF STOCK EXPIRY DATE VALUE BY EPI EPIL VALUE
-------------------- ----------- ------------ --------- --------- -----
Frova 2.5mg Tab, 2 Count Sample Blister After 6 months $1.58/unit x units x $x
without the xxxx "UCB" appearing on the following Completion
packaging
Within 6 months Nil -- -- --
following Completion
Frova 2.5mg Tab, 2 Count Sample Blister After 6 months $1.58/unit x units x $x
with the xxxx "UCB" appearing on the following Completion
packaging (if UCB has consented to its
use post-Completion) Within 6 months Nil -- -- --
following Completion
Frova 2.5mg Tab, 2 Count Sample Blister Any Nil -- -- --
with the xxxx "UCB" appearing on the
packaging (if UCB has not consented to
its use post-Completion)
Frova 2.5mg, 9 Count Blister After 12 months $3.25/unit x units x units $x
following Completion
Within 12 months Nil -- -- --
following Completion
Frova 2.5mg Bulk Tablets After 9 months $0.31/tablet x tablets x tablets $x
following Completion
Within 9 months Nil -- -- --
following Completion
Frova 2.5mg Tab, Bulk Samples After 9 months $4.10/card x cards x cards $x
following Completion of 9
Within 9 months Nil -- -- --
following Completion
4-Cyanophenyl Hydrazine, HCL At any time after $510/kg x kgs x kgs $x
Completion
At any time prior Nil -- -- --
Completion
Amine Ketal HCL - batch #39032 or 39033 At any time after $1,325/kg x kgs x kgs $x
Completion
At any time prior Nil -- -- --
Completion
-41-
OWNED OWNED BY TOTAL
DESCRIPTION OF STOCK EXPIRY DATE VALUE BY EPI EPIL VALUE
-------------------- ----------- ------------ --------- --------- -----
Amine Ketal HCL - batch #44842 or 44813 At any time after $725/kg x kgs x kgs $x
Completion
At any time prior Nil -- -- --
Completion
Amine Ketal HCL - batch #39704 or 39736 At any time after $831.60/kg x kgs x kgs $x
Completion
At any time prior Nil -- -- --
Completion
Amine Ketal HCL - other batches At any time after At cost x kgs x kgs $x
Completion
At any time prior Nil -- -- --
to Completion
Frovatriptan Succinate - batch #61829-57 At any time after $22,778/kg x kgs x kgs $x
if, at Completion, the investigation Completion
underway at the date of this Agreement
has been completed successfully and the At any time prior Nil -- -- --
product released for sale to Completion
Frovatriptan Succinate - batch #61829-57 Any Nil -- -- --
if, at Completion, the investigation
underway at the date of this Agreement
has not been completed successfully and
the product not released for sale
Frovatriptan Succinate - other batches At any time after $22,778/kg x kgs x kgs $x
Completion
At any time prior Nil -- -- --
to Completion
$X
3. After Completion each of Vernalis and the Sellers shall provide Vernalis
and Vernalis's Accountants and the Sellers and Elan's Accountants
respectively with access to those assets, documents and records within
its possession or control which they may reasonably require for the
purpose of preparing and/or agreeing the Initial Statement (as the case
may be).
4. Vernalis shall ensure that within 30 days starting on the day after
Completion Vernalis's Accountants submit to Elan's Accountants the
Initial Statement. Within 30 days starting on the day after receipt of
the Initial Statement EPI shall notify Vernalis whether or not it agrees
with the Initial Statement.
5. If EPI notifies its agreement with the Initial Statement within the 30
day period referred to in paragraph 4 or fails to give any notification
within that period, the Initial Statement shall constitute the Completion
Statement. If EPI notifies Vernalis within the 30 day period referred to
in paragraph 4 that it disagrees with the Initial Statement, paragraphs
6, 7 and 8 apply.
6. If within 14 days starting on the day after receipt of the notification
referred to in paragraph 5, EPI and Vernalis have not agreed the items in
dispute in relation to the
-42-
Initial Statement, either party may refer the items in dispute to a
partner of at least 10 years qualified experience at an independent firm
of chartered accountants agreed by the parties in writing, or failing
agreement on the identity of the firm of chartered accountants within 21
days starting on the day after receipt of the notification referred to in
paragraph 5, an independent firm of chartered accountants appointed on
the application of either party by the President for the time being of
the Institute of Chartered Accountants in England and Wales (the
"EXPERT").
7. The Expert shall act on the following basis:
(a) the Expert shall act as an expert and not as an arbitrator;
(b) the Expert's terms of reference shall be to determine the matters
in dispute within 20 days of his appointment;
(c) the parties shall each provide the Expert with all information
relating to the items in dispute which the Expert reasonably
requires and the Expert shall be entitled (to the extent he
considers appropriate) to base his determination on such
information;
(d) the decision of the Expert is, in the absence of fraud or manifest
error, final and binding on the parties; and
(e) the Expert's costs shall be paid by EPI and Vernalis as the Expert
may determine.
8. The Initial Statement, adjusted in accordance with the agreement, if any,
between EPI and Vernalis pursuant to paragraph 6 or (as the case may be)
the decision of the Expert in accordance with paragraph 7 shall
constitute the Completion Statement and be final and binding on the
parties.
-43-
SCHEDULE 3
COMPLETION REQUIREMENTS
PART A: THE SELLERS' OBLIGATIONS
1. At Completion, each Seller shall deliver to Vernalis, as evidence of the
authority of each person executing a document referred to in this
schedule on such Seller's behalf:
(a) a copy of the minutes of a duly held meeting of the directors of
such Seller (or a duly constituted committee thereof) authorising
the execution by such Seller of the document and, where such
execution is authorised by a committee of the board of directors
of such Seller, a copy of the minutes of a duly held meeting of
the directors constituting such committee or the relevant extract
thereof; or
(b) a copy of the power of attorney conferring the authority,
in each case certified to be true by a director or the secretary of such
Seller.
2. At Completion, EPI shall deliver to Vernalis:
(a) a duly executed Registered Trade Xxxx Assignment for each of the
Registered Trade Marks;
(b) a duly executed deed of assignment of Unregistered Intellectual
Property;
(c) a copy of the duly executed transfer letters to the FDA in the
agreed forms, together with Forms FDA 356h and FDA 1571;
(d) a copy of the duly executed transfer letter to Health Canada in
the agreed form, together with Form 3011; and
(e) a duly executed Transitional Services Agreement.
3. At Completion, EPIL shall deliver to Vernalis a duly executed Floating
Charge.
4. Immediately following Completion, EPI shall dispatch:
(a) to the FDA, the two duly executed transfer letters in the agreed
form and Forms FDA 356H and FDA 1571; and
(b) to Health Canada, the duly executed transfer letter in the agreed
form and Form 3011.
PART B: VERNALIS'S OBLIGATIONS
1. At Completion, Vernalis shall deliver to the Sellers:
(a) evidence in a form reasonably satisfactory to the Sellers (by way
of a certificate of Vernalis's Solicitors or otherwise) of
satisfaction of the Condition set out in Clause 4.1.1;
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(b) as evidence of the authority of each person executing a document
referred to in this schedule on behalf of Vernalis and VDL:
(i) a copy of the minutes of a duly held meeting of the
directors of each of Vernalis and VDL (or a duly
constituted committee thereof) authorising the execution by
Vernalis and VDL respectively of the document and, where
such execution is authorised by a committee of the board of
directors of Vernalis or VDL, a copy of the minutes of a
duly held meeting of the directors constituting such
committee or the relevant extract thereof; or
(ii) a copy of the power of attorney conferring the authority,
in each case certified to be true by a director or the secretary
of Vernalis;
(c) a duly executed Registered Trade Xxxx Assignment for each of the
Registered Trade Marks;
(d) a duly executed Deed of Assignment of Unregistered Intellectual
Property;
(e) a duly executed Transitional Services Agreement;
(f) a duly executed Floating Charge; and
(g) the amount stated in Clause 5.2.
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SCHEDULE 4
WARRANTIES
1. CAPACITY AND AUTHORITY
1.1 RIGHT, POWER, AUTHORITY AND ACTION
Each Seller has the right, power and authority and has taken all action
necessary to execute, deliver and exercise its rights, and perform its
obligations, under this Agreement and each document to be executed by it
at or before Completion.
1.2 BINDING AGREEMENTS
Each Seller's obligations under this Agreement and each document to be
executed by it at or before Completion are, or when the relevant document
is executed will be, enforceable in accordance with their terms.
2. STAMP DUTY
All documents (other than those which have ceased to have any legal
effect) which relate to the Sellers' title to the Assets have been duly
stamped.
3. ASSETS
3.1 TITLE AND CONDITION
None of the Assets is subject to any Encumbrance other than a Permitted
Encumbrance.
3.2 STOCK
3.2.1 The Stock consists solely of the kind regularly produced by or on
behalf of the Sellers and is not obsolete.
3.2.2 The Stock is saleable or usable for the purpose for which it is
intended in the usual course of business of the Sellers.
4. INTELLECTUAL PROPERTY
4.1 All actions required to be taken before the date of this Agreement for
the prosecution or maintenance of the Registered Trade Marks have been
taken.
4.2 So far as the Sellers are aware, there are no pending proceedings in any
court or arbitration, administrative or other tribunal which are
concerned with the validity or ownership of any of the Registered Trade
Marks. No third party has notified a Seller in writing of its intention
to bring any such proceedings.
4.3 So far as the Sellers are aware, there is no material unauthorised use or
infringement by any person of any of the IP Assets and there are no
pending proceedings in any court or arbitration or other tribunal
concerning the same.
4.4 All registration and renewal fees due and payable by the date of this
Agreement in respect of the Domain Names have been paid.
-46-
4.5 No Seller holds any granted patent or pending patent application in
respect of the Product.
5. CONTRACTS
5.1 No Seller is, and so far as the Sellers are aware, no other party to a
Contract is in material breach of such Contract.
5.2 Other than the Contracts, no Seller or Elan Group Undertaking has entered
into any other material contract in respect of the Product.
6. REGULATORY
6.1 LICENCES AND CONSENTS
6.1.1 The Sellers are not aware of anything that could reasonably be
expected to result in the revocation, suspension or modification
of the Product Registrations.
6.1.2 The Sellers are not aware of anything that is likely to result in:
(i) the market withdrawal, recall or suspension of the Product;
(ii) a change in the marketing classification of the Product;
(iii) a material change in the labelling of the Product; or
(iv) a termination or suspension of marketing of the Product.
6.2 COMPLIANCE WITH PHARMACOVIGILANCE REPORTING REQUIREMENTS
As far as the Sellers are aware, each Seller (with respect to the
Product) has at all material times complied in all material respects with
the pharmacovigilance reporting requirements in force in the Territory.
7. INSOLVENCY
7.1 In respect of each Seller:
7.1.1 no receiver or administrative receiver has been appointed in
respect of the whole or any part of its assets or undertaking;
7.1.2 no administration order has been made and no petition has been
presented for such an order;
7.1.3 no meeting has been convened at which a resolution is to be
proposed, no resolution has been passed, no order has been made
and, so far as the Sellers are aware, no petition has been
presented for its winding-up;
7.1.4 it has not stopped or suspended payment of its debts, become
unable to pay its debts or otherwise become insolvent in any
relevant jurisdiction;
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7.1.5 no voluntary arrangement, scheme of arrangement nor any scheme for
the benefit of creditors generally has been proposed or
implemented, whether or not under the protection of the court and
whether or not involving a reorganisation or rescheduling of debt;
and
7.1.6 no statutory demand nor the equivalent in any jurisdiction other
than the UK has been served and, so far as the Sellers are aware,
no such demand or equivalent has been threatened.
7.2 No distress or execution has been levied on, or other process commenced
against any of the Assets which remains undischarged.
8. COMPLIANCE WITH STATUTES
So far as the Sellers are aware, other than in relation to the Marketing
Materials, no Seller nor any of its officers, agents or employees (during
the course of their duties) in relation to the promoting, marketing,
distributing, selling and supplying of the Product has done or omitted to
do anything which is a material contravention of any statute, order,
regulation or the like giving rise to any fine, penalty, default
proceedings or other liability.
9. LITIGATION
No Seller is engaged in any litigation or arbitration proceedings
affecting the Assets as plaintiff or defendant and, so far as the Sellers
are aware, there are no such proceedings pending or threatened by or
against any Seller.
10. MANUFACTURING PROCESSES
So far as the Sellers are aware, no material modifications to the
processes by which the Product is currently manufactured are required by
law.
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SCHEDULE 5
LIMITATIONS ON THE SELLERS' LIABILITY
1. LIMITATION ON QUANTUM
1.1 No Seller is liable in respect of a Relevant Claim:
1.1.1 unless the amount that would otherwise be recoverable from the
Sellers (but for this paragraph 1.1.1) in respect of that Relevant
Claim exceeds $50,000; and
1.1.2 unless and until the amount that would otherwise be recoverable
from the Sellers (but for this paragraph 1.1.2) in respect of that
Relevant Claim, when aggregated with any other amount or amounts
recoverable in respect of other Relevant Claims (excluding any
amounts in respect of a Relevant Claim for which no Seller has any
liability because of paragraph 1.1.1), exceeds $500,000.
1.2 The Sellers' total liability in respect of all Relevant Claims is limited
to $25,000,000.
2. TIME LIMITS FOR BRINGING CLAIMS
No Seller is liable for a Relevant Claim unless Vernalis has notified it
of the Relevant Claim stating in reasonable detail the nature of the
Relevant Claim and, if possible then to quantify, the amount claimed
(detailing Vernalis's best then estimate of the loss thereby alleged to
have been suffered) on or before 31 December 2005.
3. NOTICE OF CLAIMS
A Relevant Claim notified in accordance with paragraph 2 of this Schedule
and not satisfied, settled or withdrawn is unenforceable against any
Seller on the expiry of the period of six months starting on the day of
notification of the Relevant Claim, unless proceedings in respect of the
Relevant Claim have been properly issued and validly served on the
Sellers.
4. SPECIFIC LIMITATIONS
4.1 No Seller is liable in respect of a Relevant Claim:
4.1.1 to the extent that the matter giving rise to the Relevant Claim
would not have arisen but for:
(a) an Event after Completion by or involving a Vernalis Group
Undertaking or a director, employee or agent of a Vernalis
Group Undertaking (other than to comply with law or the
provisions of a Contract); or
(b) the passing of, or a change in, a law, rule, regulation,
interpretation of the law or administrative practice of a
government, governmental department, agency or regulatory
body after the date of this Agreement, in each case not
actually or prospectively in force at the date of this
Agreement;
4.1.2 to the extent that the matter giving rise to the Relevant Claim
arises wholly or partially from an Event before or after
Completion at the request or direction of,
-49-
or with the consent of, a Vernalis Group Undertaking or an
authorised agent or adviser of a Vernalis Group Undertaking; and
4.1.3 to the extent that the amount of the Relevant Claim is increased
because a Vernalis Group Undertaking has failed to act in
accordance with paragraph 6 of this Schedule in connection with
the matter giving rise to the Relevant Claim.
5. RECOVERY ONLY ONCE
Vernalis is not entitled to recover more than once in respect of any one
matter giving rise to a Relevant Claim.
6. CONDUCT OF RELEVANT CLAIMS
6.1 If Vernalis becomes aware of a matter which constitutes or which would or
might give rise to a Relevant Claim:
6.1.1 Vernalis shall as soon as is practicable give notice to the
Sellers of the matter and shall consult with EPI with respect to
the matter;
6.1.2 Vernalis shall, and shall ensure that each Vernalis Group
Undertaking will, provide to the Sellers and their advisers
reasonable access to premises and personnel and to relevant
assets, documents and records within the power or control of each
Vernalis Group Undertaking for the purposes of investigating the
matter and enabling the Sellers to take the action referred to in
paragraph 6.1.4 (a) of this Schedule;
6.1.3 each Seller (at its cost) may take copies the documents or
records, and photograph the premises or assets, referred to in
paragraph 6.1.2 of this Schedule;
6.1.4 Vernalis shall, and shall ensure that each Vernalis Group
Undertaking will:
(a) take any action and institute any proceedings, and give any
information and assistance, as EPI may reasonably request
to:
(1) dispute, resist, appeal, compromise, defend, remedy
or mitigate the matter; or
(2) enforce against a person (other than an Elan Group
Undertaking) the rights of a Vernalis Group
Undertaking in relation to the matter; and
(b) in connection with proceedings related to the matter (other
than against an Elan Group Undertaking) use advisers
nominated by EPI and, if EPI requests, allow EPI the
exclusive conduct of the proceedings,
and in each case on the basis that EPI shall indemnify Vernalis,
and keep Vernalis indemnified, on demand against all reasonable
costs incurred as a result of a request or nomination by EPI,
provided that no such action is required to be taken if Vernalis
reasonably believes that it would have a material adverse impact
on its business in relation to the Product;
-50-
6.1.5 Vernalis shall not, and shall ensure that no Vernalis Group
Undertaking will, admit liability in respect of, or compromise or
settle, the matter without the prior written consent of EPI (not
to be unreasonably withheld or delayed); and
6.1.6 Vernalis shall take all reasonable action to mitigate any loss
suffered by it or any Vernalis Group Undertaking in respect of a
matter giving rise to a Relevant Claim.
7. RECOVERY FROM ANOTHER PERSON
7.1 If any of the Sellers pays to a Vernalis Group Undertaking an amount in
respect of a Relevant Claim and a Vernalis Group Undertaking subsequently
recovers from another person an amount which is referable to the matter
giving rise to the Relevant Claim:
7.1.1 if the amount paid by the Sellers in respect of the Relevant Claim
is more than the Sum Recovered, Vernalis shall as soon as
practicable pay to the Sellers the Sum Recovered; and
7.1.2 if the amount paid by the Sellers in respect of the Relevant Claim
is less than or equal to the Sum Recovered, Vernalis shall as soon
as practicable pay to the Sellers an amount equal to the amount
paid by the Sellers.
7.2 For the purposes of paragraph 7.1 of this Schedule, "SUM RECOVERED" means
an amount equal to the total of the amount recovered from the other
person plus any interest in respect of the amount recovered from the
person less any Tax computed by reference to the amount recovered from
the person payable by a Vernalis Group Undertaking and less all
reasonable costs incurred by a Vernalis Group Undertaking in recovering
the amount from the person.
8. MITIGATION
Nothing in this Schedule 5 restricts or limits Vernalis's general
obligation at law to mitigate any loss or damage which it may incur in
consequence of a matter giving rise to a Relevant Claim.
9. PROVISION OF INFORMATION
If, at any time after the date of this Agreement, any Seller wants to
insure against its liabilities in respect of Relevant Claims, Vernalis
shall provide such information as a prospective insurer may reasonably
require before effecting the insurance.
10. PRESERVATION OF INFORMATION
Vernalis shall use all reasonable endeavours to preserve all documents,
records, correspondence, accounts and other information whatsoever
relevant to a matter which may give rise to a Relevant Claim.
11. GENERAL
Nothing in this Schedule 5 shall have the effect of limiting or
restricting any liability of the Sellers in respect of a Relevant Claim
arising as a result of any fraud.
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SCHEDULE 6
ACTION PENDING COMPLETION
1. Prior to Completion, no Seller shall, without the prior written consent
of Vernalis (not to be unreasonably withheld or delayed):
(a) dispose of, or agree to dispose of, any Stock except in the usual
course of business;
(b) keep any Stock in any unusable condition;
(c) vary, amend or terminate a Contract or agree to vary, amend or
terminate a Contract except in the usual course of business;
(d) take any action or commence any proceedings against any third
party in respect of any infringement or unauthorised use of any of
the IP Assets;
(e) dispose of any of the IP Assets;
(f) offer any new inducements or price discounts to Key Wholesalers
(other than a standard 2% cash discount if invoices are paid in
full within 30 days of invoicing);
(g) order any Key Raw Materials (as defined in the API Supply
Agreement) or any API;
(h) convert any API into bulk tablets or convert any bulk tablets into
blister packs; and
(i) move the Equipment from its location as at the date of this
Agreement.
2. Prior to Completion, EPI shall:
(a) maintain in force the Product Registrations (including updating
the FDA as a consequence of the sale by Xxxxx Limited of its
manufacturing business to Pharmaceutical Development and
Manufacturing Services Limited) and shall not cancel or surrender
the Product Registrations unless requested to do so by any
applicable governmental or regulatory authority, provided that if
a renewal fee in respect of the Product Registration is paid by
EPI after the date of this Agreement, VDL shall reimburse EPI for
a pro rata amount for such part of the period to which the fee
relates remaining after Completion;
(b) file with the FDA the protocol for the confirmatory efficacy study
for menstrually-associated migraine in the usual course of
business, provided that a Vernalis Group Undertaking provides the
necessary support for such filing;
(c) pay all renewal fees and other official registry fees that become
due in respect of the Registered Trade Marks and the Domain Names;
(d) take all action required to be taken for the prosecution of all
Registered Trade Marks that are applications for registration;
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(e) ensure that levels of Stock at wholesalers at Completion will be
consistent with the levels of Stock at wholesalers over the
six-month period ending on the date of this Agreement save to the
extent that Vernalis does not give its consent in relation to the
matters described in paragraphs 1(g) and 1(h) above; and
(f) provide a monthly movement schedule of Stock to Vernalis.
3. Once the development and validation work which is under way at the date
of this Agreement has been completed to EPIL's satisfaction, EPIL shall
use all reasonable endeavours to enter into an amendment to the API
Supply Agreement with Evotec OAI Limited on broadly similar terms to the
draft in the agreed form.
4. Prior to Completion, the Sellers shall:
(a) co-operate with Vernalis to allow Vernalis and its agents access
to the Delivered Records at all reasonable times;
(b) fully maintain the Delivered Records; and
(c) market, distribute, sell and otherwise deal in the Stock and the
Product in the ordinary course of business as it was conducted in
relation to the Product prior to the date of this Agreement,
provided that the Sellers shall be entitled to use their
hospital/speciality sales force for the purposes of promoting the
Product.
5. Within one week following the date of this Agreement, EPI shall despatch
a copy of the Customer Information Letter to its wholesale customers for
the Product and a copy of the Physician Information Letter to physicians
to whom EPI currently promotes the Product.
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SCHEDULE 7
RESIDUAL CONTRACTS
CONTRACT
Technical Agreement between Elan Pharmaceuticals, Inc. and Xxxxx Limited, dated
2 July 2003
Technical Agreement between Elan Pharmaceuticals, Inc. and Sharp Corporation,
dated 11 September 2003
Amended Formulary Reimbursement Agreement between Elan Pharmaceuticals, Inc. and
Advanced PCS Health, L.P., dated 1 October 2002
Amended Rebate Agreement between Elan Pharmaceuticals, Inc. and Argus Health
Systems, Inc. (unsigned)
Amended Rebate Agreement between Elan Pharmaceuticals, Inc. and Blue Cross Blue
Shield of Alabama dated 8 July 2002
Rebate Agreement between Elan Pharmaceuticals, Inc. and Blue Cross and Blue
Shield of Arizona, Inc., dated 25 February 2000
Fourth Amended Rebate Agreement between Elan Pharmaceuticals, Inc. and Express
Scripts, Inc., dated 4 April 2003 (together with a Participating Manufacturer
Agreement between Elan Pharmaceuticals and Diversified Pharmaceuticals Services,
Inc., dated 16 August 2000 (as amended))
Rebate Agreement between Elan Pharmaceuticals, Inc. and Independent Health
Association, Inc., dated 17 December 2002
Amended Rebate Agreement between Elan Pharmaceuticals, Inc. and Medco Health
Solutions, Inc. (formerly known as Merck-Medco Managed Care, L.L.C., Merck-Medco
Managed Care, Inc. and Managed Care LLC) dated 16 August 2002
Amended Rebate Agreement between Elan Pharmaceuticals, Inc. and MedImpact
Healthcare Systems, Inc., dated 17 October 2002
Rebate Agreement between Elan Pharmaceuticals, Inc. and Xxxxxxx Health Plan,
Inc., dated 24 November 2002
Rebate Agreement between Elan Pharmaceuticals, Inc. and Pharmaceutical Horizons,
Inc., dated 24 September 2002
Rebate Agreement between Elan Pharmaceuticals, Inc. and ProCare PBM, dated 25
November 2003
Rebate Agreement between Elan Pharmaceuticals, Inc. and Rx America, dated 30
January 2004
Investigator Agreement between Elan Pharmaceuticals, Inc. and The New England
Center for Headache, countersigned 20 January 2004
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CONTRACT
Investigator Agreement between Elan Pharmaceutical, Inc. and Diamond Headache
Center, countersigned 6 January 2004
Multiproduct Distribution Agreement between DDN/Obergfel, LLC and Dura
Pharmaceuticals, Inc., dated 23 August 1996 (as amended by an amendment
agreement dated as of 30 April 1998).
Quote and Consulting Agreement between CanReg Inc and Elan Pharmaceuticals, Inc.
effective 31 April 2003
Development/Validation Protocol with Evotec OAI Limited dated 28 October 2003
(together with a Process Development Proposal detailing specifications effective
as of 24 November 2003)
Technical Agreement between Evotec OAI Limited and Elan (unexecuted)
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SCHEDULE 8
RETURNS, REBATES AND CHARGEBACKS
1. INTERPRETATION
In this Schedule:
"COMMERCIAL CUSTOMER" means a customer of EPI or VDL (as the case may be)
other than a Governmental Authority or the US Veterans' Administration,
including health maintenance organisations;
"ELAN RETURNS PAYMENT" means:
(a) an Elan Payment (as defined in paragraph 2.1.4) for which EPI is
not entitled to invoice Vernalis pursuant to paragraph 2.3; or
(b) an invoice paid by EPI pursuant to paragraph 2.2;
"GOVERNMENTAL AUTHORITY" means any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or
pertaining to government (including at the federal and state levels)
(except, for the avoidance of doubt, the US Veterans' Administration);
"NDC AMENDMENT DATE" means the date on which the last Product bearing
EPI's NDC number is sold to a wholesaler;
"NDC" means a National Drug Code assigned by the FDA; and
"RESPONSIBILITY TERMINATION DATE" means the date which is 60 days
following Completion.
2. RETURNS
2.1 From Completion:
2.1.1 after EPI ceases to provide the returns, rebates and chargeback
service under the Transitional Services Agreement, each of EPI and
VDL shall use its reasonable endeavours to ensure that customers
direct all returned Product to VDL (or its returns handling
facility);
2.1.2 neither EPI nor VDL shall encourage Product returns or accept
Product returns other than in the ordinary course of business,
other than, in each case, with the prior written consent of the
other;
2.1.3 VDL shall procure that any Product which is returned to any
Vernalis Group Undertaking (or its returns handling facility) is
destroyed and a credit is issued (or other payment made) for such
returned Product to the relevant customer (each of these, a
"VERNALIS PAYMENT"); and
2.1.4 EPI shall procure that any Product which is returned to it (or its
returns handling facility) is destroyed and payment is made for
such returned Product to the relevant customer (each of these, an
"ELAN PAYMENT").
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In each case, the returned Products shall be treated by a party (or its
returns handling facility) in accordance with such party's then current
returned goods policy. The parties' ability to recover from each other as
a result of taking the steps set out in this paragraph 2.1 is limited to
those rights set out in the remainder of this paragraph 2.
2.2 If:
2.2.1 VDL destroys any returned Product and makes a Vernalis Payment in
connection therewith; and
2.2.2 such Product is returned on or before the date which is 90 days
following Completion,
VDL may issue (in the period ending 150 days after Completion but not
thereafter) an invoice to EPI for the reasonable cost of such destruction
and the amount of such Vernalis Payment and, in relation to such invoice,
shall provide to EPI details of the number of units destroyed and such
other information as EPI may reasonably request in relation to such
invoice. EPI shall pay any such invoice within 30 days of it having been
issued.
2.3 If:
2.3.1 EPI destroys any returned Product and makes an Elan Payment in
connection therewith; and
2.3.2 such Product was returned to any Elan Group Undertaking (or its
returns handling facility) after the date which is 90 days
following Completion,
EPI may issue an invoice to VDL for the reasonable cost of such
destruction and the amount of such Elan Payment and shall, in relation to
such invoice, provide to VDL details of the number of units destroyed and
such other information as VDL may reasonably request. VDL shall pay any
such invoice within 30 days of it having been issued.
3. GOVERNMENTAL REBATES
3.1 From Completion:
3.1.1 VDL shall pay (or shall procure that a Vernalis Group Undertaking
pays) to each Governmental Authority such rebates as are claimed
by that Governmental Authority from a Vernalis Group Undertaking
in relation to any Product bearing the NDC number of a Vernalis
Group Undertaking, and
3.1.2 EPI shall pay to each Governmental Authority such rebates as are
claimed by that Governmental Authority from EPI in relation to any
Product bearing EPI's NDC number,
(each, a "GOVERNMENTAL REBATE"). The parties' ability to recover from
each other as a result of taking the steps set out in this paragraph 3.1
is limited to those rights set out in the remainder of this paragraph 3.
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3.2 If:
3.2.1 any Vernalis Group Undertaking pays a Governmental Rebate in
accordance with paragraph 3.1.1; and
3.2.2 the Product to which the Governmental Rebate relates was dispensed
to a patient on or before the Responsibility Termination Date (as
evidenced by a government rebate invoice),
VDL may issue (in the period ending 240 days after Completion but not
thereafter) an invoice to EPI for the amount of such Governmental Rebate
and shall provide to EPI such information as EPI may reasonably request
in relation to such invoice. EPI shall pay any such invoice within 30
days of it having been issued.
3.3 If:
3.3.1 EPI pays a Governmental Rebate in accordance with paragraph 3.1.2;
and
3.3.2 either:
(b) the Product to which the Governmental Rebate relates was
dispensed to a patient after the Responsibility Termination
Date (as evidenced by a government rebate invoice); or
(c) the date on which such Governmental Rebate was claimed by a
Government Authority was more than 240 days after
Completion,
EPI may issue an invoice to VDL for the amount of any such Governmental
Rebate and shall provide to VDL such information as VDL may reasonably
request in relation to such invoice. VDL shall pay any such invoice
within 30 days of it having been issued.
3.4 Until the first anniversary of the NDC Amendment Date, VDL shall:
3.4.1 provide to EPI the following information within 25 days of the end
of each calendar quarter to enable EPI to comply with its
submission requirements to the Centres for Medicare and Medicaid
Services (or any successor agency):
(a) the "best price" (as defined under the Social Security Act,
42 U.S.C. Sections 1396r-8(c)(1)(C)) for each Product
bearing EPI's NDC number;
(b) the "average manufacturer price" (as defined under the
Social Security Act, 42 U.S.C. Sections 1396r-8(k)(1)) for
each Product bearing EPI's NDC number; and
(c) any additional data or other information related to such
government rebate programmes as reasonably requested by
EPI; and
3.4.2 provide to EPI, within 15 days of a request by EPI, any
information relating to the Product and the prices of the Product
which EPI reasonably needs to comply with any rules and
regulations applying to any agreement relating to government
rebate or chargeback programmes.
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4. COMMERCIAL REBATES
4.1 From Completion:
4.1.1 VDL shall pay (or shall procure that a Vernalis Group Undertaking
shall pay) to each Commercial Customer all rebates as are claimed
by that Commercial Customer from a Vernalis Group Undertaking in
relation to dispensed Product, and
4.1.2 EPI shall pay to each Commercial Customer all rebates as are
claimed by that Commercial Customer from EPI in relation to
dispensed Product;
(each, a "COMMERCIAL REBATE"). The parties' ability to recover from each
other as a result of taking the steps set out in this paragraph 4.1 is
limited to those rights set out in the remainder of this paragraph 4.
4.2 If:
4.2.1 any Vernalis Group Undertaking pays a Commercial Rebate in
accordance with paragraph 4.1.1 to a commercial customer;
4.2.2 EPI has a rebate arrangement in effect at Completion with such
commercial customer; and
4.2.3 the Product to which the Commercial Rebate relates was dispensed
to a patient on or before the Responsibility Termination Date (as
evidenced by an invoice from a commercial rebate programme),
VDL may issue (in the period ending 240 days after Completion but not
thereafter) an invoice to EPI for the amount of such Commercial Rebate
that was paid on the same terms as EPI's arrangement with such Commercial
Customer in regard to rebates as at Completion. VDL shall provide to EPI
such information as EPI may reasonably request in relation to such
invoice. EPI shall pay any such invoice within 30 days of it having been
issued.
4.3 If:
4.3.1 EPI pays a Commercial Rebate in accordance with paragraph 4.1.2;
and
4.3.2 either:
(a) the Product to which the Commercial Rebate relates was
dispensed to a patient after the Responsibility Termination
Date (as evidenced by an invoice from a commercial rebate
programme); or
(b) the date on which such Commercial Rebate was claimed by a
commercial customer was more than 240 days after
Completion,
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EPI may issue an invoice to VDL for the amount of any such Commercial
Rebate and shall provide to VDL such information as VDL may reasonably
request in relation to such invoice. VDL shall pay any such invoice
within 30 days of it having been issued.
5. CHARGEBACKS
5.1 As soon as practicable after Completion, Vernalis shall use its
reasonable endeavours to enter into a contract with the US Veterans'
Administration (the "VA"). Once such contract is in place and subject to
the Transitional Services Agreement, each of EPI and Vernalis shall file
a GSA Form 72 with the VA requesting that the Product be removed from
EPI's contract with the VA and added to Vernalis's contract with the VA,
in each case as soon as possible after Completion.
5.2 From Completion:
5.2.1 for so long as the Product is listed on EPI's contract with the
VA, EPI shall process and pay to each wholesaler all chargeback
claims and related administrative service fees as are claimed by
that wholesaler in respect of purchased Product; and
5.2.2 once the Product is listed on VDL's contract with the VA, VDL
shall process and pay (or shall procure that a Vernalis Group
Undertaking shall process and pay) to each wholesaler all
chargeback claims and related administrative service fees as are
claimed by that wholesaler in respect of purchased Product,
(each, a "CHARGEBACK CLAIM"). The parties' ability to recover from each
other as a result of taking the steps set out in this paragraph 5.2 is
limited to those rights set out in the remainder of this paragraph 5.
5.3 If:
5.3.1 any Vernalis Group Undertaking pays a Chargeback Claim in
accordance with paragraph 5.2.2;
5.3.2 EPI has a chargeback arrangement in effect at Completion which
would apply to the purchase of Product by such wholesaler; and
5.3.3 the invoice from such wholesaler to its customer to which such
Chargeback Claim relates is dated on or before the Responsibility
Termination Date,
VDL may issue (in the period ending 120 days after Completion but not
thereafter) an invoice to EPI for the amount of such Chargeback Claim
that was paid on the same terms as EPI's chargeback arrangement as at
Completion. VDL shall provide to EPI such information as EPI may
reasonably request in relation to such invoice. EPI shall pay any such
invoice within 30 days of it having been issued.
5.4 If:
5.4.1 EPI pays a Chargeback Claim in accordance with paragraph 5.2.1;
and
5.4.2 either:
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(a) the invoice from the relevant wholesaler to the relevant
wholesale customer to which such Chargeback Claim relates
is dated after the Responsibility Termination Date; or
(b) EPI did not have a chargeback arrangement in effect at
Completion which would apply to the purchase of Product by
such wholesaler; or
(c) the date on which such Chargeback Claim was made by a
wholesaler was more than 120 days after Completion,
EPI may issue an invoice to VDL for the amount of any such Chargeback
Claim and shall provide to VDL such information as VDL may reasonably
request in relation to such invoice. VDL shall pay any such invoice
within 30 days of it having been issued.
6. FURTHER UNDERTAKINGS
6.1 Subject to the Transitional Services Agreement and to the extent that it
will not disrupt the performance of the Services (as defined in the
Transitional Services Agreement), Vernalis shall, within 90 days of
Completion, change EPI's NDC number on new Product to Vernalis's NDC
number.
6.2 Subject to the Transitional Services Agreement and to the extent that it
will not disrupt the performance of the Services (as defined in the
Transitional Services Agreement), EPI and VDL shall, following
Completion, use reasonable efforts to notify the wholesale trade
customers for the Product of the transfer of the Assets from the Sellers
to VDL.
6.3 VDL shall not increase the wholesale acquisition cost of the Product
prior to the first day of the first calendar quarter beginning after the
Responsibility Termination Date.
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SCHEDULE 9
FROVA LOGO
[FROVA LOGO]
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SCHEDULE 10
PRODUCT IMAGE
[FROVA LOGO]
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EXECUTED BY THE PARTIES
Signed by )
for and on behalf of )
ELAN CORPORATION PLC )
Signed by )
for and on behalf of )
ELAN PHARMA INTERNATIONAL LIMITED )
Signed by )
for and on behalf of )
ELAN PHARMACEUTICALS, INC. )
Signed by )
for and on behalf of )
VERNALIS DEVELOPMENT LIMITED )
Signed by )
for and on behalf of )
VERNALIS PLC )