Asset Purchase Agreement
Exhibit 2.1
THIS ASSET PURCHASE AGREEMENT (the “Agreement”) is entered into as of December
1, 2006 (the “Signing Date”) by and between Sangamo BioSciences, Inc., a Delaware corporation
(“Sangamo”) and Xxxxxxx Lifesciences LLC, a Delaware limited liability company (“Xxxxxxx”).
Sangamo and Xxxxxxx are referred to individually as a “Party” and collectively as the “Parties.”
RECITALS
WHEREAS, Sangamo and Xxxxxxx are parties to the License Agreement (defined below) and the
Research Funding Agreement (defined below);
WHEREAS, the Parties now desire to terminate the License Agreement and their respective
obligations under the Research Funding Agreement; and
WHEREAS, Xxxxxxx desires to transfer to Sangamo, in some cases, and revert back to Sangamo, in
other cases, and Sangamo desires to acquire from Xxxxxxx, Xxxxxxx’ right, title and interest in and
to Xxxxxxx’ assets relating to the Products (defined below), as more specifically set forth below.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing recitals and the mutual covenants and
agreements contained in this Agreement, the Parties hereby agree as follows:
ARTICLE 1
DEFINITIONS
The following terms, when capitalized, shall have the following meanings (such meanings to be
equally applicable to both the singular and plural forms of the terms defined) as used in this
Agreement:
1.1 “Assets” has the meaning set forth in Section 3.1.
1.2 “Affiliate(s)” means, with respect to any person, any person which, directly or indirectly
through the ownership of equity securities or through other arrangements, either controls, is
controlled by or is under common control with, such person. A person shall be deemed to be in
control of another entity if it owns or controls at least fifty percent (50%) of the equity
securities of the subject entity entitled to vote in the election of directors (or, in the case of
an entity that is not a corporation, for the election of the corresponding managing authority);
provided, however, that a person shall not be deemed to be in control of an entity
in which a person owns a majority of the ordinary voting power to elect a majority of the board of
directors or other governing board but is restricted from electing such majority by contract or
otherwise, until such time as such restrictions are no longer in effect.
1.3 “Assigned Copyrights” has the meaning set forth in Section 3.1(a)(iii).
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1.4 “Assigned Data” has the meaning set forth in Section 3.1(b).
1.5 “Assigned Equipment” has the meaning set forth in Section 3.1(j).
1.6 “Assigned Government Licenses” has the meaning set forth in Section 3.1(f).
1.7 “Assigned Intellectual Property” has the meaning set forth in Section 3.1(a).
1.8 “Assigned Know-How” has the meaning set forth in Section 3.1(a)(ii).
1.9 “Assigned Materials” has the meaning set forth in Section 3.1(c).
1.10 “Assigned Patent Rights” has the meaning set forth in Section 3.1(a)(i).
1.11 “Assigned Trademarks” has the meaning set forth in Section 3.1(a)(iv).
1.12 “Assumed Contracts” has the meaning set forth in Section 3.1(h).
1.13 “Assumed Liabilities” has the meaning set forth in Section 3.3(b).
1.14 “Assumption Agreement” has the meaning set forth in Section 6.6(c).
1.15 “Breach” means, with respect to a representation, warranty, covenant, obligation or other
provision, an inaccuracy in or breach (including any inadvertent or innocent breach) of, or any
failure (including any inadvertent failure) to comply with or perform, such representation,
warranty, covenant, obligation or other provision.
1.16 “Claim Notice” has the meaning set forth in Section 11.1(c).
1.17 “Clinical Trial” means a clinical trial conducted by or on behalf of Xxxxxxx or its
Affiliates or pursuant to an Xxxxxxx Contract, in each case in which a Product is administered to a
human.
1.18 “Clinical Trial Materials” means all Products and placebo for the Products manufactured
by or on behalf of Xxxxxxx or its Affiliates that are for use in preclinical studies or Clinical
Trials primarily relating to the Products, whether in bulk, formulated or finished form and whether
in existence on the Signing Date or manufactured between the Signing Date and Closing Date.
1.19 “Clinical Trial Study Reports” means all reports or summaries of all data, records and
documents resulting from the Clinical Trials.
1.20 “Closing” means the closing of the transactions contemplated by this Agreement.
1.21 “Closing Date” means the date on which the Closing shall take place at the Palo Alto
office of Xxxxxx Godward Kronish LLP, commencing at 10:00 a.m. local time, which date shall be the
earliest of: (a) one (1) business day after the date on which the last of the conditions specified
in Article 10 to be satisfied or waived has been satisfied or waived, (b) the date specified in Sangamo’s written notice to the Escrow Agent pursuant to Section 10.3, or (c)
such other date as the Parties may agree upon in writing.
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1.22 “Common Stock” means the common stock, par value $0.01 per share, of Sangamo.
1.23 “Company” means Sangamo for the purposes of Section 5.2.
1.24 “Confidential Information” means all proprietary and confidential information, including
Know-How, disclosed by one Party to the other Party pursuant to, or in connection with this
Agreement, the License Agreement or the Research Funding Agreement, including any information
disclosed in contemplation of this Agreement prior to the Closing Date, regardless of the form or
manner of disclosure. “Confidential Information” shall not include information: (a) of which the
Party receiving such information was rightfully in possession prior to disclosure, as evidenced by
appropriate contemporaneous documentation; (b) that was independently developed by employees or
agents of the Party receiving the information without the benefit of Confidential Information
provided by the Party disclosing the information, as evidenced by appropriate contemporaneous
documentation; (c) that the Party receiving the information rightfully receives from a Third Party
not owing a duty of confidentiality to the Party disclosing the information; (d) that is or becomes
publicly available without fault of the Party receiving the information; (e) that is published
incident to patent application prosecution; or (f) that the Parties agree in writing will not be
treated as Confidential Information.
1.25 “Contract” means any written, oral, implied or other agreement, contract, understanding,
arrangement, instrument, note, guaranty, indemnity, representation, warranty, deed, assignment,
power of attorney, certificate, purchase order, work order, insurance policy, benefit plan,
commitment, covenant, assurance or undertaking of any nature.
1.26 “Damages” means any loss, damage, injury, decline in value, Liability, claim, demand,
settlement, judgment, award, fine, penalty, Tax, fee (including any reasonable legal fee, expert
fee, accounting fee or advisory fee), charge, cost (including any reasonable cost of investigation)
or expense of any nature.
1.27 “Dispute” means any claim, dispute or controversy of whatever nature arising out of or
relating to this Agreement, including the performance or alleged non-performance of a Party of its
obligations under this Agreement.
1.28 “Xxxxxxx Confidential Information” means (a) all Confidential Information disclosed by
Xxxxxxx to Sangamo, except for the Assigned Patent Rights, Assigned Know-How, Assigned Data,
Assigned Materials, Clinical Trial Materials, Technical Documents, Government Files and Financial
Materials, and (b) the terms of this Agreement, the License Agreement and the Research Funding
Agreement.
1.29 “Xxxxxxx Contracts” means the Contracts listed on Schedule [1.29].
1.30 “Xxxxxxx Indemnitees” means the following Persons: (a) Xxxxxxx; (b) Xxxxxxx’ current and
future Affiliates; (c) the respective Representatives of the Persons referred to in clauses “(a)” and “(b)” above; and (d) the respective successors and assigns of the Persons
referred to in clauses “(a)”, “(b)” and “(c)” above.
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1.31 “Encumbrance” means any lien, pledge, hypothecation, charge, mortgage, security interest,
encumbrance, equitable interest, claim, lease, license, covenant, infringement, interference,
order, right of first refusal, reservation, limitation, impairment, imperfection of title, and
condition or restriction of any nature that has an adverse effect on the title, ownership,
possession, use, exercise or transfer of any asset, including any restriction on the receipt of any
income derived from any asset; except Permitted Encumbrances and any of the foregoing or other
matters, individually or in the aggregate, that are not materially adverse to, or materially
interfere with, the use of the asset as they are currently or contemplated to be used or their
adequacy for such use.
1.32 “Entity” means any corporation (including any non-profit corporation), general
partnership, limited partnership, limited liability partnership, joint venture, estate, trust,
cooperative, foundation, society, political party, union, company (including any limited liability
company or joint stock company), firm or other enterprise, association, organization or entity.
1.33 “Escrow Account” has the meaning set forth in Section 2.1.
1.34 “Escrow Agent” has the meaning set forth in Section 2.1.
1.35 “Escrow Agreement” has the meaning set forth in Section 2.1.
1.36 “Escrowed Agreements” has the meaning set forth in Section 2.1.
1.37 “Excluded Assets” has the meaning set forth in Section 3.2.
1.38 “Exchange Act” means the Securities Exchange Act of 1934, as amended.
1.39 “FDA” means the United States Food and Drug Administration, or any successor agency
thereto.
1.40 “FDA Transfer Letter” has the meaning set forth in Section 6.8(b).
1.41 “Financial Materials” has the meaning set forth in Section 3.1(i).
1.42 “GAAP” means United States generally accepted accounting principles.
1.43 “Government Files” means any filings made by or on behalf of Xxxxxxx or its
Affiliates with any Governmental Authority with respect to the IND or primarily related to any
Product.
1.44 “Government License” means a regulatory approval or license, or investigational
applications, issued, granted, allowed or given by or under the authority of any Governmental
Authority or pursuant to any law, rule or regulation throughout the Territory and required for, and
used primarily in connection with, the clinical testing in humans of the Product anywhere in the
Territory. For clarity, the IND shall constitute a Government License.
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1.45 “Governmental Authority” means any United States, state, local or foreign
governmental entity or municipality or subdivision thereof or any authority, department,
commission, board, bureau, agency, court or instrumentality.
1.46 “IND” has the meaning set forth in Section 6.8(b).
1.47 “Indemnitee” means either Sangamo Indemnitee or Xxxxxxx Indemnitee, as applicable.
1.48 “IRB” means an institutional review board.
1.49 “Key Employees” has the meaning set forth in Section 6.5.
1.50 “Know-How” means all non-publicly available knowledge, data (including pharmacological,
toxicological, preclinical and clinical test data, and analytical and quality control data),
information, assay protocols, methods, results or ideas that (a) is necessary to research, develop
or manufacture a Product, (b) was made, conceived or reduced to practice pursuant to the License
Agreement, in the course of manufacturing a Product or pursuant to a Clinical Trial, or (c) was
used by or on behalf of Xxxxxxx or its Affiliates prior to the Closing Date in the course of
researching, developing, or manufacturing a Product.
1.51 “Know-How Transfer” has the meaning set forth in Section 6.4.
1.52 “Knowledge of Xxxxxxx” means the actual knowledge of the individuals listed on
Schedule [1.52].
1.53 “Knowledge of Sangamo” means the actual knowledge of the individuals listed on
Schedule [1.53].
1.54 “Legal Requirement” means any federal, state, local, municipal, foreign or other law,
statute, legislation, constitution, ordinance, code, edict, decree, proclamation, treaty,
convention, rule, regulation, ruling, directive, pronouncement, determination, decision, opinion or
interpretation issued, enacted, adopted, passed, approved, promulgated, made, implemented or
otherwise put into effect by or under the authority of any Governmental Authority.
1.55 “Liability” means any debt, obligation, duty or liability of any nature (including any
unknown, undisclosed, unmatured, unaccrued, unasserted, contingent, indirect, conditional, implied,
vicarious, derivative, joint, several or secondary liability), regardless of whether such debt,
obligation, duty or liability would be required to be disclosed on a balance sheet prepared in
accordance with GAAP and regardless of whether such debt, obligation, duty or liability is
immediately due and payable.
1.56 “License Agreement” means that certain License Agreement by and between Sangamo and
Xxxxxx Healthcare Corporation (Xxxxxxx’ predecessor in interest), dated as of January 11, 2000,
including all amendments thereto.
1.57 “Mutual Release Agreement” has the meaning set forth in Section 2.1.
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1.58 “Net Sales” means the gross sales price of a Royalty Product sold by Sangamo, its
Affiliates, sublicensees or assignees of the Sangamo IP (or Affiliates of such sublicensees or
assignees) to a Third Party, less the following to the extent borne by the seller and not taken
into account in determining gross sales price: (a) deduction of cash, trade and quantity discounts
actually given; (b) discounts, refunds, rebates, chargebacks, retroactive price adjustments, and
any other allowances actually given which effectively reduce the net selling price, including
institutional rebates or discounts such as those actually provided to Medicare, Medicaid, the
Department of Defense or any similar organization in the United States or otherwise; and (c)
credits and allowances for product returns actually made; (d) any other adjustments required by
generally accepted accounting principles in the United States. Net Sales shall exclude samples
distributed in the usual course of business. In the event a Royalty Product is sold as a part of a
combined product that contains other active ingredient(s), Net Sales shall be calculated by
multiplying the Net Sales of the combined product by the fraction A over B, in which A is the sales
price of the Royalty Product portion of the combined product when such Royalty Product is sold
separately, and B is the sales price of the combined product. In the event that there is no
separate sales price of the Royalty Product, Net Sales allocable to the Royalty Product shall be
reasonably and mutually determined by Sangamo and Xxxxxxx.
1.59 “Patent” means all United States patents, applications for patents, including any
divisionals, continuations, continuations-in-part (to the extent claiming subject matter disclosed
in the parent application), continued prosecution applications, provisional applications for
patent, and any patents issuing therefrom, and any reexaminations, reissues, extensions, and patent
term restorations and any foreign equivalents thereof filed anywhere in the Territory.
1.60 “Permitted Encumbrances” means (a) Encumbrances for Taxes not yet due and payable or that
are being contested in good faith by appropriate proceedings, (b) any mechanics’, carriers’,
workmen’s, repairmen’s or other similar liens arising or incurred in the ordinary course of
business, and (c) any liens arising under original purchase price, conditional sales contracts and
equipment leases with Third Parties entered into in the ordinary course of business.
1.61 “Person” means any individual, Entity or Governmental Authority.
1.62 “Product” means a pharmaceutical product that comprises zinc finger DNA binding proteins
or nucleic acids that encode zinc finger DNA binding proteins for the activation of VEGF genes or
VEGF receptors. For the avoidance of doubt, a pharmaceutical product shall not be Product if the
zinc finger DNA binding protein contained in or encoded by such product primarily targets and
activates a gene other than VEGF or a VEGF receptor.
1.63 “RAC” means the Recombinant DNA Advisory Committee of the National Institutes of Health,
or any successor thereto.
1.64 “Register”, “registration”, and “registered” refers to a registration effected by
preparing and filing a registration statement in compliance with the Securities Act, and the
declaration or ordering of effectiveness of such registration statement.
1.65 “Registrable Securities” means any and all of the Shares issued to Xxxxxxx hereunder;
provided, however, that such term shall not include any shares of Common Stock which have been previously registered or which have been sold to the public either pursuant to
a registration statement or Rule 144.
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1.66 “Regulatory Approval” means all approvals (including pricing and reimbursement
approvals), product and/or establishment licenses, registrations or authorizations of any regional,
federal, state or local regulatory agency, department, bureau or other governmental entity,
necessary for the sale of Products in a regulatory jurisdiction.
1.67 “Related Party” means each of the following: (a) each individual who is, or who has at
any time been, an officer of Xxxxxxx; (b) each member of the family of each of the individuals
referred to in clause “(a)” above; and (c) any Entity (other than Xxxxxxx) in which any one of the
individuals referred to in clauses “(a)” and “(b)” above holds or held (or in which more than one
of such individuals collectively hold or held), beneficially or otherwise, a controlling interest
or a material voting, proprietary or equity interest.
1.68 “Representatives” means officers, directors, employees, agents, attorneys, accountants,
advisors and representatives.
1.69 “Required Third Party Consent” has the meaning set forth in Section 6.6(a).
1.70 “Research Funding Agreement” means that certain Research Funding Agreement by and between
Sangamo and Xxxxxx Healthcare Corporation (Xxxxxxx’ predecessor in interest), dated as of January
11, 2000, including all amendments thereto.
1.71 “Royalty Indication” means diabetic neuropathy, intermittent claudication, critical limb
ischemia, ischemic cerebral vascular disease (excluding hemorrhagic stroke), peripheral artery
disease and ischemic heart disease.
1.72 “Royalty Product” means a Product that is sold in any Territory for treatment of one or
more Royalty Indications.
1.73 “Rule 144” means Rule 144 as promulgated by the SEC under the Securities Act, as such
Rule may be amended from time to time, or any similar successor rule that may be promulgated by the
SEC.
1.74 “Sangamo Confidential Information” means (a) all Confidential Information disclosed by
Sangamo to Xxxxxxx pursuant to the License Agreement, Research Funding Agreement or this Agreement,
including Sangamo Materials and sequence information relating thereto, (b) the terms of this
Agreement, the License Agreement and Research Funding Agreement, and (c) after the Closing Date,
the Assigned Patent Rights (but only to the extent such Assigned Patent Rights relate to
unpublished patent applications or are otherwise not publicly available), and that portion of the
Assigned Know-How, Assigned Data, Assigned Materials, Clinical Trial Materials, Technical
Documents, Government Files and Financial Materials that are not publicly available as of the
Signing Date.
1.75 “Sangamo Indemnitees” means the following Persons: (a) Sangamo; (b) Sangamo’s current
and future Affiliates; (c) the respective Representatives of the Persons referred to in clauses “(a)” and “(b)” above; and (d) the respective successors and assigns of
the Persons referred to in clauses “(a)”, “(b)” and “(c)” above.
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1.76 “Sangamo IP” means any and all intellectual property rights licensed to Xxxxxxx pursuant
to the terms of the License Agreement.
1.77 “Sangamo Materials” means the materials and information transferred to Xxxxxxx by Sangamo
under the License Agreement, and all copies, progeny and derivatives thereof.
1.78 “Sangamo Party” has the meaning set forth in Section 4.2.
1.79 “Sangamo SEC Documents” has the meaning set forth in Section 9.5.
1.80 “Sausalito Facilities” means the leased facility of Xxxxxxx located at Xxx Xxxxxx Xxxxx,
Xxxxx 000, Xxxxxxxxx, Xxxxxxxxxx 00000.
1.81 “SEC” means the U.S. Securities and Exchange Commission.
1.82 “Securities Act” means the Securities Act of 1933, as amended.
1.83 “Shares” has the meaning set forth in Section 5.1(a).
1.84 “Tax” means any tax (including any income tax, franchise tax, capital gains tax,
estimated tax, gross receipts tax, value-added tax, surtax, excise tax, ad valorem tax, transfer
tax, stamp tax, sales tax, use tax, property tax, business tax, occupation tax, inventory tax,
occupancy tax, withholding tax or payroll tax), levy, assessment, tariff, impost, imposition, toll,
duty (including any customs duty), deficiency or fee, and any related charge or amount (including
any fine, penalty or interest), that is, has been or may in the future be (a) imposed, assessed or
collected by or under the authority of any Governmental Authority, or (b) payable pursuant to any
tax-sharing agreement or similar Contract.
1.85 “Technical Documents” means all scientific and technical information and documentation
that is primarily related to the research, development or manufacture of any Product and that is in
embodied in documents or computer files owned or controlled by Xxxxxxx or its Affiliates as of the
Closing Date or during the Transition Period, including: laboratory notebooks, technical
documentation, manufacturing documentation, quality records, specifications, data, vector maps,
protocols, manuals, reference materials, and application notes; detailed restriction maps and
complete sequence information for each plasmid and nucleic acid included in the Assigned Materials;
full descriptions of all cell lines included in the Assigned Materials; detailed cell transfection
protocols; protocols for administering Product to humans, animals or cells; protocols detailing
methods, assays, processes, and procedures (including standard operating procedures) for
manufacturing or testing any Product.
1.86 “Termination Agreement” has the meaning set forth in Section 2.1.
1.87 “Territory” means all countries of the world.
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1.88 “Third Party” means any person or entity other than Sangamo or Xxxxxxx and their
respective Affiliates.
1.89 “Transactional Agreements” means the Assumption Agreement, the Mutual Release Agreement,
the Termination Agreement and the Escrow Agreement.
1.90 “Transition Period” means the period from the Signing Date through the Closing Date.
1.91 “VEGF” means vascular endothelial growth factors.
ARTICLE 2
SIGNING DATE ACTIVITIES
2.1 Signing Date. On the Signing Date, each Party shall duly execute the Termination
Agreement, Mutual Release Agreement, Assumption Agreement and FDA Transfer Letter, in the forms
attached hereto as Exhibits A, B, C and D, respectively (the
“Escrowed Agreements”), and shall deposit the executed Escrowed Agreements into an escrow account
(the “Escrow Account”) to be held and distributed by the escrow agent (the “Escrow Agent”) on the
Closing Date in accordance with the terms of the Escrow Agreement dated as of the Signing Date by
and among the Parties and the Escrow Agent, in the form attached hereto as Exhibit E (the
“Escrow Agreement”). In addition, on the Signing Date, Sangamo shall deposit the Shares into the
Escrow Account pursuant to Section 5.1 of this Agreement.
ARTICLE 3
PURCHASE AND SALE OF ASSETS
3.1 Purchase and Sale of Assets. Subject to the terms and conditions set forth herein, on the
Closing Date, Xxxxxxx shall sell, assign, transfer, convey, grant and deliver to Sangamo, and
Sangamo shall purchase, acquire and receive from Xxxxxxx, good and valid title and all other rights
and interests in and to the Assets, free and clear of any Encumbrances. For purposes of this
Agreement, “Assets” means the following assets:
(a) Intellectual Property.
(i) Patent Rights. All Patents listed on Schedule 3.1(a)(i) (collectively, the
“Assigned Patent Rights”).
(ii) Know-How. All Know-How owned by Xxxxxxx or its Affiliates as of the Closing Date that is
primarily related to a Product (collectively, the “Assigned Know-How”).
(iii) Assigned Copyrights and Other Related Proprietary Rights. All copyrights, copyright
registrations or copyright applications listed on Schedule 3.1(a)(iii) (collectively, the
“Assigned Copyrights”).
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(iv) Trademarks. All trademarks, design marks, service marks, trade names and trade dress
(including registrations and applications for the foregoing) listed on Schedule 3.1(a)(iv)
(collectively, the “Assigned Trademarks”).
The Assigned Patent Rights, Assigned Know-How, Assigned Copyrights and Assigned Trademarks shall be
referred to collectively as the “Assigned Intellectual Property.”
(b) Data. All data (including raw data, data files and summaries, including the Clinical
Trial Study Reports) owned by Xxxxxxx or its Affiliates as of the Closing Date that were generated
in the course of a Clinical Trial or other research on or testing of any Product by or on behalf of
Xxxxxxx or its Affiliates (collectively, the “Assigned Data”).
(c) Materials. All biological or chemical materials (including DNA, RNA, plasmids, vectors,
cell lines, proteins, antibodies, assays, poloxymers) owned by Xxxxxxx or its Affiliates as of the
Closing Date which (i) have been used by Xxxxxxx or its Affiliates during the term of the License
Agreement primarily in the research, development or manufacture of the Products, but excluding all
non-proprietary materials, such as reagents and other consumables that are generally available; or
(ii) have been derived from any Sangamo Materials and any and all progeny, derivatives,
replications, variants, and recombinants thereof, including those generated by recombinant genetic
engineering methods (collectively, “Assigned Materials”).
(d) Clinical Trial Materials. All Clinical Trial Materials owned by Xxxxxxx or its Affiliates
as of the Closing Date.
(e) Technical Documents. All Technical Documents owned by Xxxxxxx or its Affiliates as of the
Closing Date.
(f) Government Licenses. All Government Licenses owned by Xxxxxxx or its Affiliates on the
Closing Date and all applications therefor and related correspondence (collectively, the “Assigned
Government Licenses”).
(g) Government Files. All Government Files owned by Xxxxxxx or its Affiliates on the Closing
Date.
(h) Contracts. All rights of Xxxxxxx or its Affiliates under the Xxxxxxx Contracts listed on
Schedule 3.1(h) (the “Assumed Contracts”).
(i) Financial Materials. Any and all copies owned by Xxxxxxx or its Affiliates as of the
Closing Date of final market research analyses prepared on behalf of Xxxxxxx or its Affiliates,
relating primarily to the Products (collectively, the “Financial Materials”).
(j) Personal Property. All personal property physically located at the Sausalito Facilities,
including equipment, owned by Xxxxxxx on the Closing Date and used by or on behalf of Xxxxxxx
solely with respect to the Product (the “Assigned Equipment”).
3.2 Excluded Assets. Anything in Section 3.1 to the contrary notwithstanding, the Assets do
not include any assets, rights or interests of Xxxxxxx (collectively, the “Excluded Assets”) not
specifically set forth in Section 3.1, including:
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(a) Contracts or agreements with any Third Party that are not Assumed Contracts;
(b) Xxxxxxx facilities that are not Sausalito Facilities;
(c) Employment agreements;
(d) Intellectual property and rights thereto that were developed, conceived, reduced to
practice or otherwise acquired prior to the date of the License Agreement or, except as described
in Section 7.5, that are developed, conceived, reduced to practice or otherwise acquired after the
Closing Date;
(e) Corporate records (formation documents, stock records, board resolutions and minutes, and
the like); and
(f) laboratory and refrigerated storage equipment at Xxxxxxx’ facilities located in Irvine,
California.
3.3 Assumed Liabilities.
(a) Other than as specifically set forth in this Section 3.3, Sangamo shall not assume any
Liabilities of Xxxxxxx whatsoever, whether relating to the Assets or otherwise.
(b) Notwithstanding Section 3.3(a), at and following the Closing Date, Sangamo shall assume
and agree to honor, pay and discharge when due the following Liabilities of Xxxxxxx (the “Assumed
Liabilities”):
(i) all Liabilities of Xxxxxxx under the Assumed Contracts to be performed on or after, and in
respect of periods following, the Closing Date;
(ii) all Liabilities of Xxxxxxx under the Assigned Government Licenses to be performed on or
after, and in respect of periods following, the Closing Date; and
(iii) all other Liabilities arising out of or related to the Assets, in respect of periods
following the Closing Date;
provided, however, that notwithstanding the foregoing, and notwithstanding anything
to the contrary contained in this Agreement, the Assumed Liabilities shall be limited to
Liabilities that:
(1) arise on or after the Closing Date;
(2) do not arise from or relate to any Breach by Xxxxxxx of any provision of any of the
Assumed Contracts; or
(3) do not arise from or relate to any event, circumstance or condition occurring or
existing on or prior to the Closing Date that, with notice or lapse of time, would
constitute or result in a Breach of any of the Assumed Contracts.
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3.4 Taxes. Xxxxxxx and Sangamo shall each bear and pay one-half of any sales taxes, use
taxes, transfer taxes, documentary charges, filing fees, recording fees or similar taxes, charges,
fees or expenses that may become payable in connection with the sale of the Assets to Sangamo. The
Parties shall reasonably cooperate to file all requests for certifications of sales and use tax
due, including pursuant to Section 6812 of the California Revenue and Taxation Code.
3.5 Allocation. As soon as reasonably practicable after the Signing Date, but in any event
prior to the Closing Date, the Parties shall prepare and mutually agree to a statement setting
forth the Parties’ determination of the manner in which the consideration paid by Sangamo with
respect to the Assets is to be allocated among the Assets, which statement shall be attached hereto
as Schedule 3.5. The allocation prescribed by such statement shall be conclusive and
binding upon the Parties for all purposes. The Parties shall not file any Tax Return or other
document with, or make any statement or declaration to, any Governmental Authority that is
inconsistent with such allocation.
ARTICLE 4
INTELLECTUAL PROPERTY RIGHTS
4.1 Trademarks. Xxxxxxx shall not adopt, use or register any trademark or service xxxx
confusingly similar to any Assigned Trademark, in any context on the Internet or elsewhere in any
country.
4.2 Xxxxxxx Covenant Not to Assert. Xxxxxxx agrees, effective as of the Closing Date, that
neither it nor any of its Affiliates (and in each case such entity’s successor or assign) shall
assert or enforce against Sangamo, its Affiliates, or any licensee, sublicensee, manufacturer or
distributor (and in each case such entity’s successor or assign) (each a “Sangamo Party”), any
intellectual property owned by or exclusively licensed to Xxxxxxx or its Affiliates as of the
Closing Date that would be infringed, misappropriated or otherwise violated by any Sangamo Party’s
manufacture, use, development, import, offer for sale, or sale of the Products within the
Territory. The Parties acknowledge and agree that the covenant set forth in this Section 4.2 shall
be limited to the Products and shall not, under any circumstances, extend to any medical devices
including, catheters or delivery systems, whether or not sold in combination with the Products.
ARTICLE 5
PAYMENTS
5.1 Stock Escrow.
(a) As partial consideration for the sale, assignment, transfer, conveyance, grant and
delivery by Xxxxxxx of the Assets, the other rights and licenses granted by Xxxxxxx hereunder, and
the covenants, agreements and releases made by Xxxxxxx, all to or in favor of Sangamo, and in
addition to assuming the Assumed Liabilities, Sangamo shall issue and deliver to Xxxxxxx 1,000,000
shares of Common Stock (the “Shares”) as follows: On the Signing Date, Sangamo shall deposit the
Shares into the Escrow Account, to be held and distributed by the Escrow Agent to Xxxxxxx on the
Closing Date in accordance with the terms of the Escrow Agreement.
12
(b) Xxxxxxx understands that the Shares issued pursuant to Section 5.1(a) will not have been
registered under the Securities Act nor qualified under the blue sky laws of any state, and that
the Shares are being offered and sold to Xxxxxxx pursuant to an exemption from such registration
and qualification based in part upon the representations of Xxxxxxx contained herein. Xxxxxxx
acknowledges the certificate representing the shares shall contain an appropriate legend regarding
the foregoing. Xxxxxxx acknowledges and agrees with Sangamo that it is acquiring the Shares for
investment for its own account and not with a view to, or for resale in connection with, the
distribution or other disposition thereof in violation of applicable securities laws.
(c) Xxxxxxx represents and warrants to Sangamo that it is an “accredited investor,” as defined
in Rule 501 under the Securities Act, and has such knowledge and experience in financial and
business matters that it is capable of evaluating the merits and risks of an investment such as the
Shares.
(d) Xxxxxxx acknowledges to Sangamo that it is fully aware of the applicable transfer
restrictions of the Shares. Xxxxxxx understands that there are substantial risks pertaining to the
making of an investment in the Shares hereunder.
5.2 Registration Rights.
(a) Form S-3 Registrations. In case the Company shall receive from Xxxxxxx a written request
that the Company effect a registration statement on Form S-3 with respect to all or a part of the
Registrable Securities, the Company shall use commercially reasonable efforts to file, as soon as
practicable but not later than twenty (20) business days from the date of receipt by the Company of
the Notice of Registration (as defined below), with the SEC a registration statement on Form S-3
covering the resale of such Registrable Securities in a manner consistent with the method or plan
of distribution requested and shall use commercially reasonable effort to cause such Registration
Statement to be declared effective by the SEC as soon as practicable. Any request for such
registration by Xxxxxxx (a “Notice of Registration”) shall specify (i) the amount of Registrable
Shares proposed to be registered; and (ii) the intended method or methods and plan of distribution
thereof. In addition, Xxxxxxx shall provide to the Company all information and materials
reasonably requested by the Company in order to permit the Company to comply with all applicable
SEC requirements. The Company shall not be obligated to file or effect any such registration
pursuant to this Section 5.2(a):
(i) if Form S-3 is not available for such offering;
(ii) if Xxxxxxx proposes to sell less than 200,000 shares of Registrable Securities and such
other securities (if any);
(iii) if the request is made by Xxxxxxx prior to six (6) months after the Closing Date;
(iv) if the Company has, within the twelve (12) month period preceding the date of such
request, already effected one (1) registration on Form S-3 for Xxxxxxx pursuant to this Section
5.2(a);
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(v) for any Registrable Securities that have been sold to the public;
(vi) if all the Registrable Securities are eligible for resale during a three (3) month period
pursuant to Rule 144 under the Securities Act;
(vii) if the sale of Registrable Securities pursuant to the method and plan of distribution
requested in the Notice of Registration is not permissible under applicable law and the
requirements of the Form S-3; or
(viii) in any particular jurisdiction in which the Company would be required to qualify to do
business or to execute a general consent to service of process in effecting such registration,
qualification or compliance.
(b) Suspension of Registration Rights. Notwithstanding anything to the contrary contained
herein, the Company shall not be obligated to file or effect the Registration Statements, or to
file any amendment or supplement thereto, and may suspend the right of Xxxxxxx to make sales
pursuant to an effective Registration Statement, at any time when the filing thereof at the time
requested, or the offering of securities pursuant thereto, (i) would, in the good faith judgment of
the Company and its counsel, materially and adversely affect a pending or proposed acquisition,
merger, recapitalization, consolidation, reorganization, joint venture, divestiture, tender offer,
financing or similar transaction of the Company or one of its Affiliates, or negotiations,
discussions or pending proposals related thereto or (ii) would materially and adversely impact the
Company and its Affiliate, including by requiring, in the good faith judgment of the Company and
its counsel, the disclosure of an event or state of facts relating to the Company or its Affiliates
which is material to the Company and the disclosure of which could be adverse to the Company,
provided that the Company may not suspend the rights to make sales pursuant to this Section
5.2(b) for more than an aggregate of ninety (90) days, and provided further that
Sangamo shall not defer its obligation in this manner more than twice in any twelve (12) month
period.
(c) Expenses. All expenses incurred in connection with a registration pursuant to Section
5.2(a), including all registration, filing and qualification fees, printers’ and accounting fees,
fees and disbursements of counsel for the Company, and the reasonable fees and disbursements of one
counsel for Xxxxxxx (but excluding underwriters’ discounts and commissions), shall be borne by the
Company. Xxxxxxx shall bear all discounts, commissions or other amounts payable to underwriters or
brokers in connection with such offering.
(d) Obligations of the Company. Whenever required to effect the registration of any
Registrable Securities under this Agreement, the Company shall use commercially reasonable efforts
to do the following as expeditiously as reasonably possible:
(i) Prepare and file with the SEC a registration statement with respect to such Registrable
Securities and cause such registration statement to become effective, and, upon the request of
Xxxxxxx, keep such registration statement effective for up to ninety (90) days.
(ii) Prepare and file with the SEC such amendments and supplements to such registration
statement and the prospectus used in connection with such registration statement as may be necessary to comply with the provisions of the Securities Act with respect
to the disposition of all securities covered by such registration statement.
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(iii) Furnish to Xxxxxxx such number of copies of prospectus, including a preliminary
prospectus, in conformity with the requirements of the Securities Act, and such other documents as
Xxxxxxx may reasonably request in order to facilitate the disposition of Registrable Securities
owned by it that are included in such registration.
(iv) Use reasonable efforts to register and qualify the securities covered by such
registration statement under such other securities or Blue Sky laws of such jurisdictions as shall
be reasonably requested by the Xxxxxxx, provided that the Company shall not be required in
connection therewith or as a condition thereto to qualify to do business or to file, a general
consent to service of process in any such states or jurisdictions.
(v) Notify Xxxxxxx at any time when a prospectus relating thereto is required to be, delivered
under the Securities Act of the happening of any event as a result of which the prospectus included
in such registration statement, as then in effect, includes an untrue statement of a material fact
or omits to state a material fact required to be stated therein or necessary to make the statements
therein not misleading in the light of the circumstances then existing.
(vi) If the registration of Registrable Securities covers an underwritten offering, furnish,
at the request of Xxxxxxx, on the date that such Registrable Securities are delivered to the
underwriters for sale (1) an opinion, dated as of such date, of the counsel representing the
Company for the purposes of such registration, in form and substance as is customarily given to
underwriters in an underwritten public offering and reasonably satisfactory to the lead
underwriter, addressed to the underwriters and (2) a “comfort” letter dated as of such date, from
the independent certified public accountants of the Company, in form and substance as is
customarily given by independent certified public accountants to underwriters in an underwritten
public offering and reasonably satisfactory to the lead underwriter, addressed to the underwriters.
(e) Rule 144 Reporting. With a view to making available the benefits of certain rules and
regulations of the SEC which may at any time permit the sale of Registrable Securities to the
public without registration, after such time as a public market exists for the Common Stock of the
Company, the Company agrees to:
(i) Make and keep public information available, as those terms are understood and defined in
Rule 144 under the Securities Act;
(ii) Use reasonable, diligent efforts to file with the SEC in a timely manner all reports and
other documents required of the Company under the Securities Act and the Exchange Act; and
(iii) So long as Xxxxxxx owns any Registrable Securities, to furnish to Xxxxxxx forthwith upon
request a written statement by the Company as to its compliance with the reporting requirements of
said Rule 144, and of the Securities Act and the Exchange Act, a copy of the most recent annual or
quarterly report of the Company, and such other reports and documents of the Company as Xxxxxxx may reasonably request in availing itself of any rule or
regulation of the SEC allowing Xxxxxxx to sell any such securities without registration.
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5.3 Royalties.
(a) As additional partial consideration for the sale, assignment, transfer, conveyance, grant
and delivery by Xxxxxxx of the Assets, the other rights and licenses granted by Xxxxxxx hereunder,
and the covenants, agreements and releases made by Xxxxxxx, all to or in favor of Sangamo, and in
addition to assuming the Assumed Liabilities, subject to the terms and conditions of this
Agreement, Sangamo shall pay Xxxxxxx a royalty equal to:
(i) Five percent (5%) of the Net Sales of each Royalty Product sold by Sangamo or its
Affiliate for use in a Royalty Indication; and
(ii) The greater of (i) five percent (5%) of the Net Sales of each Royalty Product sold by a
sublicensee for use in a Royalty Indication or (ii) twenty-five percent (25%) of the royalty
payment received by Sangamo from its sublicensee on account of a Royalty Product sold by such
sublicensee for use in a Royalty Indication.
(b) The parties acknowledge and agree that, with respect to any unit of Royalty Product sold
for use in a Royalty Indication, Sangamo shall only owe royalties pursuant to Section 5.3(a)(i) or
Section 5.3(a)(ii), but not both.
(c) Subject to this Section 5.3 and Section 5.4, the royalty obligations of Sangamo and its
Affiliates, sublicensees and successors in interest set forth in Section 5.3(a) shall be perpetual
and apply to the Territory.
(d) Each Product sold by Sangamo or its Affiliate or sublicensee in a particular country shall
be presumed to be sold for the indication(s) for which it has received Regulatory Approval in such
country. Such presumption may be overcome if a Party, at its sole expense, procures and provides
the other Party with commercially reasonable evidence of off-label sales of such Product in such
country during the relevant period. Written notice and evidence shall be promptly provided to the
other Party upon learning of any such off-label sales of the Product. Such evidence shall be based
upon prescription data products or services or other relevant pharmaceutical sales tracking
research services (including, for example, use of random sampling, use of data regarding
distribution channels as a proxy for indication-specific sales and development of mathematical
models for approximating indication-specific sales) generally recognized in the pharmaceutical
industry as being reliable in the tracking of sales of pharmaceutical products of similar nature
and prescribed by similar physicians. For example, if Xxxxxxx timely provides Sangamo with such
commercially reasonable evidence that twenty percent (20%) of Sangamo’s sales in the United States
in a particular calendar quarter, of a Product that has only been approved for indications that are
not Royalty Indications, are sold for use in a Royalty Indication, then Sangamo shall pay royalties
pursuant to Section 5.3(a)(i) with respect to such twenty percent (20%) of such sales by Sangamo
with respect to that particular Product in the United States during such calendar quarter.
5.4 Maximum Royalties. The total royalties paid by Sangamo pursuant to Section 5.3 shall not
exceed:
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(a) $20,000,000 in any calendar year; or
(b) $100,000,000 in the aggregate.
Sangamo’s obligation to make royalty payments to Xxxxxxx shall terminate with respect to a
particular calendar year once Sangamo has paid Xxxxxxx $20,000,000 in royalties pursuant to Section
5.3 with respect to such calendar year. Sangamo shall not have any further obligation to make
royalty payments to Xxxxxxx once Sangamo has paid Xxxxxxx a total of $100,000,000 in royalties
pursuant to Section 5.3 during the term of this Agreement.
5.5 Royalty Reports and Payments. Within sixty (60) days after the end of each calendar
quarter prior to the termination of Sangamo’s royalty obligations pursuant to Section 5.4(b),
Sangamo shall deliver to Xxxxxxx a true and accurate report of Net Sales of Product sold by Sangamo
and its Affiliates and sublicensees (to the extent that Sangamo has such sublicensee information,
provided that Sangamo shall use commercially reasonable efforts to obtain such information,
and while Sangamo may delay payment due to unavailability of information, it shall nevertheless
promptly make payments once such information is available) during such calendar quarter and the
royalty payments received by Sangamo with respect to sublicensee’s sales of Royalty Products during
such calendar quarter, accompanied by all royalties due under Section 5.3 for such calendar
quarter. In addition, within such sixty (60) day period after the end of each calendar quarter for
which royalty payments are due pursuant to this Agreement, Sangamo shall deliver to Xxxxxxx a true
and accurate true-up report of all royalty payments not timely made pursuant to Section 5.3.
5.6 Payment Method. All payments due to Xxxxxxx under this Agreement shall be made by Sangamo
in the United States in U.S. Dollars by wire transfer to a bank account designated by Xxxxxxx.
5.7 Exchange Rate. With respect to sales of Royalty Products made in a currency other than
U.S. dollars, for the purposes of calculating royalties due under Section 5.3, Net Sales will be
determined in the original currency and then converted into U.S. dollars based on the rate of
exchange published in the Wall Street Journal for the last business day in the relevant calendar
quarter.
5.8 Withholdings. All taxes, assessments and fees of any nature levied or incurred on account
of any royalty payments accruing under this Agreement, by national, state or local governments,
will be assumed and paid by Sangamo, except taxes levied thereon as income taxes to Xxxxxxx, and if
such taxes are required to be withheld by Sangamo by the applicable national, state or local
Governmental Authority, then Sangamo shall deduct such taxes from such payments due to Xxxxxxx and
shall pay such taxes on the account of Xxxxxxx, and shall secure and provide to Xxxxxxx a receipt
of such payment, together with copies of all pertinent communications from or with such
Governmental Authority with respect thereto. Sangamo agrees to reasonably cooperate with Xxxxxxx
in any effort by Xxxxxxx in claiming any exemption from such deductions or withholdings under any
double taxation or similar agreement or treaty from time to time in force and in minimizing the
amount required to be so withheld or deducted.
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5.9 Records; Audit. Sangamo will maintain, and cause its Affiliates and sublicensees to
maintain, complete and accurate records of all sales and other dispositions of Royalty Products
prior to the termination of Sangamo’s royalty obligations pursuant to Section 5.4(b), including the
amounts which are relevant to the calculation of Net Sales under this Agreement, and such records
shall be retained and open during reasonable business hours for a period of three (3) years from
the creation of individual records for examination or for a longer period of time, if required by
applicable law, and not more often than once each calendar year, by an independent certified public
accountant that is selected by Xxxxxxx and reasonably acceptable to Sangamo for the sole purpose of
verifying the correctness of the Net Sales and royalty calculations made by Sangamo and its
Affiliates and sublicensees under this Agreement, provided that such accountant shall enter
into a binding confidentiality and non-use agreement with Sangamo that is no less restrictive than
the terms of Article 13. The auditing expense shall be paid by Xxxxxxx; provided,
however, that if the audit reveals an underpayment by Sangamo, of amounts due for any
quarter under Section 5.5 in excess of five percent (5%), Sangamo shall bear and promptly reimburse
Xxxxxxx for its reasonably, out-of-pocket expenses for such audit. In any case, Sangamo shall
promptly make any payments necessary to Xxxxxxx to correct any underpayment by Sangamo. Any such
underpayment shall bear interest at a rate equal to the smallest of (a) 10% per annum, (b) the
average rate of the three (3) months London Inter-Bank Offering Rate (“LIBOR”) multiplied by two
(2), or (c) the highest amount permitted by law, from the date when such payment was due until
payment in full, including interest accrued thereon. Any records or accounting information
received from Sangamo, its Affiliates, licensees, sublicensees or distributors shall be Sangamo
Confidential Information. Results of any such audit shall be provided to both Parties, subject to
Article 13.
ARTICLE 6
TRANSITION PERIOD COVENANTS
6.1 Delivery of Tangible Assets. Xxxxxxx shall make commercially reasonable efforts to
deliver to Sangamo, in accordance with Schedule 6.1, all tangible Assets and any tangible
manifestations of intangible Assets which are indicated as being deliverable prior to the Closing
Date, as promptly as possible and prior to December 22, 2006. Xxxxxxx will deliver all documents
in electronic form where available and practical. All costs associated with delivery of the Assets
shall be solely at Xxxxxxx’ expense and, unless otherwise specified in this Agreement, shall be
delivered in a commercially reasonable manner mutually agreed by the Parties. Sangamo shall
cooperate with Xxxxxxx with respect to Xxxxxxx’ deliveries contemplated by this Section 6.1.
Notwithstanding the foregoing, the sale, assignment, transfer, conveyance, grant and delivery of
Assets under this Agreement shall be effective as of, and not prior to, the Closing Date.
6.2 Additional Deliveries. In the event that, during the Transition Period, either Sangamo or
Xxxxxxx discovers that (a) any item that reasonably should have been included in the Schedules
provided for in Article 3 was omitted or (b) the representations and warranties of Xxxxxxx made in
Article 8 with respect to the Assets described therein were not materially true, correct and
complete as of the Signing Date, then the Party discovering such deficiency shall promptly notify
the other Party, and Xxxxxxx shall promptly supplement the Schedules, as applicable, and promptly
deliver such omitted items to Sangamo so as to correct such deficiency;
18
provided that the foregoing shall not limit Sangamo’s rights and remedies at law or in
equity for so long as Xxxxxxx has failed to deliver any omitted items and correct any such
deficiency.
6.3 Clinical Trial Materials. Xxxxxxx and Sangamo shall mutually agree to the schedule for
delivery of the Clinical Trial Materials to Sangamo or its designee.
6.4 Know-How Transfer. Xxxxxxx shall use commercially reasonable efforts to disclose the
Assigned Know-How to Sangamo in an orderly and professional manner as promptly as reasonably
possible and prior to December 22, 2006 (collectively, the “Know-How Transfer”). Such Know-How
Transfer shall include formal and informal training sessions led by Xxx Xxxxxxxx and/or Xxx Xxxx
(provided that each such individual remains an employee of Xxxxxxx) at Sangamo facilities
as well as support for Sangamo employees and consultants via the telephone or email.
6.5 Employees.
(a) Promptly after the Signing Date, Sangamo shall offer employment to the Xxxxxxx employees
identified on Schedule 6.5 attached hereto (the “Key Employees”), which employment, if
accepted, shall be effective as of the Closing Date. Xxxxxxx shall make commercially reasonable
efforts to retain the Key Employees until the Closing Date.
(b) On the Closing Date, Xxxxxxx shall terminate, and Sangamo shall hire, those Key Employees
that accept Sangamo’s offer of employment.
6.6 Assumed Contracts.
(a) Notwithstanding anything in this Agreement to the contrary, except as provided in this
Section 6.6, this Agreement shall not constitute an agreement to assign any Assumed Contract or any
claim or right or any benefit arising thereunder or resulting therefrom if an attempted assignment
thereof, without the consent of a Third Party thereto, would constitute a breach or other
contravention thereof or in any way adversely affect the rights of Sangamo or Xxxxxxx thereunder
(each such consent, a “Required Third Party Consent”). Xxxxxxx will use commercially reasonable
efforts to obtain each such Required Third Party Consent as promptly as reasonably possible and
prior to December 22, 2006. Sangamo will cooperate with Xxxxxxx, and will provide Xxxxxxx with
such assistance as Xxxxxxx may reasonably request, for the purpose of obtaining the Required Third
Party Consents. Notwithstanding anything herein, the failure to obtain any Required Third Party
Consent, in itself, or the failure to assign any Contract as a result of the lack of such Required
Third Party Consent, shall not constitute a Breach of any representation, warranty, covenant,
obligation or other provision, provided that (i) Xxxxxxx uses commercially reasonable
efforts to obtain such Required Third Party Consent and keeps Sangamo informed regarding the status
of such efforts, (ii) Xxxxxxx takes all commercially reasonable actions requested by Sangamo to
obtain such Required Third Party Consent, and (iii) if it appears that such Required Third Party
Consent will not be forthcoming, Xxxxxxx will discuss with Sangamo alternative measures
(provided that they are commercially reasonable) for providing Sangamo with the benefits
and obligations of such Assumed Contract and, upon Sangamo’s agreement, will implement such
measures until such Required Third Party Consent is obtained.
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(b) During the Transition Period, Xxxxxxx shall continue to perform all of its obligations
under all Assumed Contracts and shall retain all Liabilities under the Assumed Contracts. Except
as otherwise approved in writing by Sangamo, during the Transition Period, Xxxxxxx will not (i)
terminate or materially amend, grant a sublicense under, or assign, any of Assumed Contracts, (ii)
commit a breach of any Assumed Contract, or (iii) enter into any new Contract that relates
primarily to the research, development, manufacture or commercialization of any Product.
(c) On the Closing Date, Sangamo will assume the Assumed Contracts by entering into with
Xxxxxxx an Assumption Agreement in substantially the form of Exhibit C (the “Assumption
Agreement”).
6.7 Observation Rights. During the Transition Period, Xxxxxxx shall allow designated Sangamo
employees or agents (at Sangamo’s expense), subject to binding confidentiality and non-use
obligations and/or agreements with Sangamo no less restrictive than the terms of Article 13, to
visit the Sausalito Facilities, and have reasonable access to Xxxxxxx’ personnel at the Sausalito
Facilities for the purpose of coordinating and observing the transfer of Assets to Sangamo under
this Agreement and the provision of Services hereunder. The Parties shall make commercially
reasonable efforts to coordinate all such activities in a timely manner, including the provision of
reasonable advance notice of the same. All Sangamo employees and agents participating in such
facility visits shall comply with all Xxxxxxx written policies and procedures while on Xxxxxxx’
sites as reasonably notified by Xxxxxxx.
6.8 Regulatory Matters.
(a) During the Transition Period, Xxxxxxx shall (i) retain all responsibility for
Product-related regulatory matters, (ii) shall maintain and not transfer any Assigned Government
License and (iii) not procure any Government Licenses.
(b) On the Signing Date, Xxxxxxx shall deposit into the Escrow Account written notification to
the FDA of the transfer by Xxxxxxx to Sangamo of the Investigational New Drug Application
designated as U.S. IND #11544 (the “IND”, and such notification, the “FDA Transfer Letter”). The
FDA Transfer Letter shall be held and distributed by the Escrow Agent to Sangamo on the Closing
Date in accordance with the terms of the Escrow Agreement. Concurrently with the delivery of the
FDA Transfer Letter to the FDA, Sangamo shall notify the FDA that it accepts the transfer. Both
Parties shall perform such other activities as required by the FDA to accept such transfer.
Xxxxxxx shall take all actions necessary to transfer to Sangamo all Assigned Government Licenses,
if any, on or before the Closing Date, and Sangamo shall perform all activities required by the
applicable Governmental Authority or reasonably requested by Xxxxxxx to obtain such transfers by
the Closing Date. All transfers shall be made in accordance with applicable laws and regulations.
(c) Xxxxxxx hereby grants to Sangamo and its Affiliates and sublicensees the exclusive right
to use and reference any filings submitted to Governmental Authorities by or on behalf of Xxxxxxx
for any Government License, and any data and information contained in such filings or approvals
relating primarily to the Products, in Sangamo’s and its Affiliate’s and sublicensee’s filings or
submissions to Governmental Authorities with respect to the development, registration, manufacture or commercialization of Products anywhere in the
Territory.
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(d) During the Transition Period, Xxxxxxx agrees to (i) promptly provide Sangamo with
reasonable written notice and copies of all communications from Governmental Authorities relating
to such Assigned Government License; and (ii) arrange for Sangamo’s participation in any meetings
or conference telephone calls with Governmental Authorities relating to such Assigned Government
License, whether initiated by such Governmental Authority or at Sangamo’s reasonable request.
(e) On or prior to the Closing Date, Xxxxxxx shall send notices to the RAC, all applicable
IRBs and similar committees to direct Product-related communications (except for communications
related to Xxxxxxx’ responsibilities pursuant to Section 7.2), to Sangamo commencing on the Closing
Date.
6.9 Adverse Drug Experiences. Xxxxxxx shall promptly provide Sangamo with all information
received by Xxxxxxx during the Transition Period regarding adverse drug experiences related to the
use of the Product (regardless of where occurring). Throughout the Transition Period, Xxxxxxx
shall be primarily responsible for all pharmacovigilance activities with respect to any Product
including: adverse event reporting, including literature review and associated reporting; adverse
event follow-up reporting; preparation and submission of all safety reports to the regulatory
authorities as required by local laws and/or regulations; maintaining the safety database for such
Product; all interactions with health authorities regarding Product safety; periodic submissions;
labeling modifications; safety monitoring and detection; and safety measures (e.g., Dear Doctor
Letters, restriction on distribution, etc.). Xxxxxxx shall keep Sangamo informed with respect to
such activities and shall facilitate Sangamo’s requests to be involved in such activities. Prior
to the Closing Date, the Parties shall agree upon a plan for Sangamo to assume such activities as
of the Closing Date in accordance with Section 7.3.
6.10 Preservation of Assets. During the Transition Period, Xxxxxxx shall use commercially
reasonable efforts to preserve and maintain all Assets in existence as of the Signing Date and
shall not take any action or fail to take any action, outside the ordinary course of business, that
would diminish the value of the Assets or cause items which would have been Assets if the Signing
Date were the Closing Date to cease to be Assets as of the Closing Date.
6.11 Further Assurances. The Parties agree to execute, acknowledge and deliver such further
instruments, and to do all such other reasonable acts, as may be necessary or appropriate in order
to carry out the purposes and intent of this Agreement, including those acts necessary or useful to
satisfy the Closing conditions specified in Sections 10.1 and 10.2. Each Party shall bear its own
costs and expenses associated with fulfilling its obligations as set forth in this Section 6.11.
ARTICLE 7
POST-CLOSING DATE COVENANTS
7.1 [Intentionally Omitted]
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7.2 Enrolled Patients. Sangamo shall assume full responsibility for (including fulfilling all
regulatory reporting obligations and otherwise complying with applicable Legal Requirements), and
shall perform all obligations set forth in any Assumed Contract with respect to, each and every
human enrolled in a Clinical Trial prior to the Closing Date. Xxxxxxx agrees to pay 50% of the
out-of-pocket third party costs arising from the follow up obligations, including treatment, of
patients enrolled in Clinical Trials identified on Schedule 8.6(a) prior to the Closing.
7.3 Adverse Drug Experiences. To the extent Xxxxxxx receives any information after the
Closing Date regarding adverse drug experiences related to the use of the Product (regardless of
where occurring), Xxxxxxx shall promptly provide Sangamo with such information in accordance with
the Adverse Event Reporting Procedures set forth in Schedule 7.3. Except as set forth in
Section 7.2, commencing on the Closing Date, Sangamo shall be solely responsible for all
pharmacovigilance activities with respect to any Product including: adverse event reporting,
including literature review and associated reporting; adverse event follow-up reporting;
preparation and submission of all safety reports to the regulatory authorities as required by local
laws and/or regulations; maintaining the safety database for such Product; all interactions with
health authorities regarding Product safety; periodic submissions; labeling modifications; safety
monitoring and detection; and safety measures (e.g., Dear Doctor Letters and restriction on
distribution).
7.4 Regulatory Matters. Commencing on the Closing Date and subject to Section 7.2, Sangamo
shall bear all responsibility for Product-related regulatory matters.
7.5 New Data and Intellectual Property. Xxxxxxx shall promptly disclose to Sangamo all data
and intellectual property arising after the Closing Date as a result of Xxxxxxx’ obligations
pursuant to Section 7.2. Each such datum and intellectual property shall be deemed an Asset and,
to the extent owned or controlled by Xxxxxxx or its Affiliate, shall be automatically assigned to
Sangamo. If assignment is not possible, then Xxxxxxx shall be deemed to have granted Sangamo an
exclusive, fully paid, irrevocable, worldwide license, with respect to such data and intellectual
property, with the right to grant sublicenses through multiple tiers, to make, have made, use,
import, offer for sale and sell Products.
7.6 Post-Closing Deliveries. Xxxxxxx shall deliver to Sangamo all tangible Assets and any
tangible manifestations of intangible Assets listed on Schedule 6.1, which are indicated as
being deliverable after the Closing Date, as promptly as practicable. To the extent that any
Know-How Transfer contemplated to be provided pursuant to Section 6.4 shall not have been so
completed prior to the Closing Date, Xxxxxxx shall continue to make commercially reasonable efforts
to disclose the Assigned Know-How to Sangamo, including providing reasonable access to Xxx Xxxxxxxx
and Xxx Xxxx (provided that each such individual remains an employee of Xxxxxxx and such
access does not disrupt Xxxxxxx’ operations or such individual’s performance of his duties).
7.7 Consulting Agreements. After the Closing Date, Xxxxxxx shall not enforce any contractual
prohibitions set forth in the section entitled “Relationship with Others” in any consulting
agreement listed on Schedule 1.29 that would otherwise prohibit any Third Party that is a
party to such a consulting agreement from performing services for Sangamo with respect to a Product. At Sangamo’s request, Xxxxxxx shall notify in writing each such Third Party
identified in such request that such Third Party may perform services for Sangamo with respect to a
Product without such Third Party breaching its obligations to Xxxxxxx pursuant to such section.
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ARTICLE 8
REPRESENTATIONS AND WARRANTIES OF XXXXXXX
Xxxxxxx represents and warrants as follows:
8.1 Due Organization. Xxxxxxx is a limited liability company duly organized under the laws of
the State of Delaware and has all necessary power and authority to conduct its business in the
manner in which it is currently being conducted. Xxxxxxx is duly qualified to do business and is
in good standing as a foreign corporation in each jurisdiction where the ownership or operation of
its assets or the conduct of its business requires such qualification, except for failures to be so
qualified or in good standing, as the case may be, that would not individually or in the aggregate
have a material adverse effect on Xxxxxxx.
8.2 Title to Assets.
(a) Xxxxxxx or an Xxxxxxx Affiliate is the sole owner of, and has good and valid title to, all
of the Assets. All of the Assets are owned by Xxxxxxx or its Affiliate free and clear of any
Encumbrances.
(b) To the Knowledge of Xxxxxxx, except as set forth on Schedule 8.2(b), the Assets
collectively constitute, as of the Signing Date, all of the properties, rights, interests and other
tangible and intangible assets that are owned and used by Xxxxxxx or its Affiliates to research,
manufacture and develop Products in the manner in which such research, manufacture and development
is currently being conducted or has been conducted during the twelve (12) months prior to the
Signing Date, in each by or on behalf of Xxxxxxx or its Affiliates.
(c) Except as ascertainable (in nature and amount) solely by reference to the express terms of
the Xxxxxxx Contracts or otherwise specified in Schedule 8.2(c), Xxxxxxx is not obligated
to make any payment to any person or entity for the use or other exploitation of any of the Assets.
(d) Except as set forth on Schedule 8.2(d), there is no action, claim, suit,
arbitration or other proceeding pending against Xxxxxxx or, to the Knowledge of Xxxxxxx,
threatened, by any Person (i) contesting Xxxxxxx’ right to use, exclusively, the Assets or (ii)
otherwise challenging the ownership of any Asset or the validity, enforceability or use of any of
the Assigned Intellectual Property.
8.3 Intellectual Property.
(a) Except as set forth on Schedule 8.3(a)(i), no Person has been granted any license
under, or otherwise has received or acquired any right (whether or not currently exercisable) or
interest in, any Assigned Intellectual Property. Except as set forth on Schedule
8.3(a)(ii), Xxxxxxx is not bound by, and no Assigned Intellectual Property is subject to, any Contract containing any covenant or other provision that limits or restricts the ability of
Xxxxxxx to use, exploit, assert, or enforce any Assigned Intellectual Property anywhere in the
world.
23
(b) To the Knowledge of Xxxxxxx, Schedules 3.1(a)(i) and 3.1(a)(iii) identify
(i) the jurisdiction in which such Assigned Patent Right or Assigned Trademark has been registered
or filed and the applicable registration or serial number and (ii) each filing, payment, and
action, which, according to the applicable patent and trademark office, is due within ninety (90)
days after the Signing Date.
(c) To the Knowledge of Xxxxxxx, neither the execution, delivery or performance of this
Agreement nor the consummation of any of the transactions contemplated hereby will, with or without
notice or the lapse of time, result in or give any other Person the right or option to cause or
declare: (i) a loss of, or Encumbrance on, any Assigned Intellectual Property; (ii) a breach of
any Xxxxxxx Contract; (iii) the release, disclosure or delivery of any Assigned Intellectual
Property by or to any escrow agent or other Person; or (iv) the grant, assignment or transfer to
any other Person of any license or other right or interest under, to or in any Assigned
Intellectual Property.
(d) Xxxxxxx has the right to make the covenants set forth in Section 4.2 without breaching any
obligation to any Person.
(e) Excluding Sangamo IP, neither Xxxxxxx nor any Affiliate of Xxxxxxx has licensed any
intellectual property from any Third Party relating primarily to the manufacture, use, development,
import, offer for sale or sale of any Product.
(f) Except as set forth on Schedule 8.3(f), Schedule 3.1(a)(i) lists all
Patents owned by Xxxxxxx or its Affiliates as of the Signing Date that are relating primarily to
the research, development or manufacture of any Product.
(g) Except as set forth on Schedule 8.3(g), Schedule 3.1(a)(iii) lists all
copyrights, copyright registrations or copyright applications owned by Xxxxxxx or its Affiliates as
of the Signing Date that primarily relate to any Product or to research, develop, manufacture or
commercialize any Product.
(h) Except as set forth on Schedule 8.3(h), Schedule 3.1(a)(iv) lists all
trademarks, design marks, service marks, trade names or trade dress, whether registered or not, as
well as all registrations and applications for the same that are owned by Xxxxxxx or its Affiliates
and that relate primarily to a Product, or any substantially similar variations thereof, and the
goodwill of the business symbolized thereby, excluding Xxxxxxx House Marks. “Xxxxxxx House Marks”
are any trademarks or service marks, and registrations and applications therefor, utilized by
Xxxxxxx or planned to be utilized by Xxxxxxx, in whole or in part, in connection with any product
(other than the Products) or service of Xxxxxxx or any of its Affiliates or that contain the name
or any part of the name or logo now or previously used by Xxxxxxx or any of its Affiliates, and the
goodwill of the business symbolized thereby.
(i) Except as set forth on Schedule 8.3(i), Xxxxxxx and its Affiliates have not
granted any sublicenses to any Person under any Sangamo IP.
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8.4 Clinical Trial Materials. To the Knowledge of Xxxxxxx, Schedule 8.4 is a list of
all Clinical Trial Materials in existence as of the Signing Date. To the Knowledge of Xxxxxxx, all
such Clinical Trial Materials were manufactured and stored in compliance with Good Manufacturing
Practices and comply with the specifications for such Product. For the purposes of this Section
8.4, “Good Manufacturing Practices” means current good manufacturing practices pursuant to the U.S.
Federal Food, Drug and Cosmetics Act as amended (21 USC 301 et seq.) and the relevant U.S.
regulations in Title 21 of the U.S. Code of Federal Regulations (including Parts 11, 210, 211, 600
and 611).
8.5 Contracts.
(a) Schedule 1.29 is a complete and accurate list of each and every written and, to
Xxxxxxx’ knowledge, oral Contract presently in effect between Xxxxxxx or its Affiliates and a Third
Party, in each case that is primarily related to the Assets or the research, development,
manufacture or commercialization of Products.
(b) Each Assumed Contract is valid and binding on Xxxxxxx and, to the Knowledge of Xxxxxxx, on
the other parties thereto in accordance with its terms and is in full force and effect. Except as
set forth in Schedule 8.5, to the Knowledge of Xxxxxxx: (i) no Person has materially
violated or breached, or declared or committed any default in any material respect under, any
Assumed Contract; (ii) no event has occurred, and no circumstance or condition exists, that might
(with or without notice or lapse of time) (A) result in a material violation or breach of any of
the provisions of any Assumed Contract, (B) give any Person the right to declare a default or
exercise any remedy under any Assumed Contract, (C) give any Person the right to accelerate the
maturity or performance of any Assumed Contract, or (D) give any Person the right to cancel,
terminate or materially modify any Assumed Contract; (iii) Xxxxxxx has not received any written
notice regarding any actual, alleged, possible or potential material violation or breach of, or
default under, any Assumed Contract; and (iv) Xxxxxxx has not waived any of its material rights
under any of the Assumed Contracts.
8.6 Clinical Trials.
(a) Schedule 8.6(a) is an accurate and complete list of all Clinical Trials initiated
prior to the Signing Date. To the Knowledge of Xxxxxxx, the Clinical Trials were conducted in
material compliance with Good Clinical Practice, the reporting of adverse events, the filing of
reports and security promulgated by the FDA and similar regulations promulgated by other
Governmental Authorities as applicable to such trials. For the purposes of this Section 8.6, “Good
Clinical Practice” means current good clinical practice pursuant to the U.S. Federal Food, Drug and
Cosmetics Act as amended (21 USC 301 et seq.) and the relevant U.S. regulations in Title 21 of the
U.S. Code of Federal Regulations (including Parts 11, 50, 54, 56, 312, 314 and 601).
(b) There have been no actual personal injury or product liability claims pending or, to the
Knowledge of Xxxxxxx, no threatened personal injury or product liability claims, associated with
the Product.
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(c) During the Clinical Trials, other than as disclosed on Schedule 8.6(c), there have
been no deaths or serious adverse events and all such deaths and serious adverse events, to the
extent required to be reported to the FDA, have been reported to the FDA.
(d) Xxxxxxx has not received any written notices or other written correspondence from the FDA
or any other Governmental Authority requiring the termination or suspension of any Clinical Trials.
(e) In the course of its research, development or manufacture of the Products, as applicable,
(i) Xxxxxxx has not used any employee or consultant with which it has a written agreement or to
Xxxxxxx’ Knowledge, any other consultant, who is or has been debarred by the FDA, and (ii) to
Xxxxxxx’ Knowledge, it has not used any employee or consultant who is the subject of debarment
proceedings by the FDA.
8.7 Authority; Binding Nature of Agreements. Xxxxxxx has the power and authority to enter
into and to perform its obligations under this Agreement. The execution, delivery and performance
by Xxxxxxx of this Agreement have been duly authorized by all necessary action on the part of
Xxxxxxx. Assuming due execution by Sangamo, this Agreement constitutes the legal, valid and
binding obligation of Xxxxxxx, enforceable against Xxxxxxx in accordance with its terms, subject to
(i) laws of general application relating to bankruptcy, insolvency and the relief of debtors and
(ii) rules of law governing specific performance, injunctive relief and other equitable remedies.
8.8 Non-Contravention. The execution and delivery of this Agreement, and the consummation or
performance of any of the obligations under this Agreement by Xxxxxxx do not and will not (with or
without notice or lapse of time):
(a) contravene, conflict with or result in a violation of (i) any of the provisions of
Xxxxxxx’ Operating Agreement or other organizational documents, or (ii) any resolution adopted by
Xxxxxxx’ Board of Directors (or any committee thereof) or members;
(b) contravene, conflict with or result in a violation of, any Legal Requirement to which
Xxxxxxx, or any of the assets owned or used by Xxxxxxx, is subject, except as would not
individually or in the aggregate have a material adverse effect on the Assets; or
(c) result in the imposition or creation of any Encumbrance upon or with respect to the
Assets.
8.9 Compliance with Legal Requirements; Litigation.
(a) Except as set forth on Schedule 8.9(a) and except as would not individually or in
the aggregate have a material adverse effect on Xxxxxxx, Xxxxxxx is in compliance with all
applicable Legal Requirements.
(b) Except as set forth on Schedule 8.9(b), no judgment, order, writ, injunction or
decree of any Governmental Authority that is related to Xxxxxxx is in effect nor is any action,
claim, suit, arbitration, inquiry, investigation or other proceeding of any nature
26
(whether criminal, civil, legislative, administrative, regulatory, prosecutorial or otherwise)
by or before any arbitrator or Governmental Authority with respect to Xxxxxxx’ operations pending
or, to the Knowledge of Xxxxxxx, threatened, in each case as would individually or in the aggregate
have a material adverse effect on Xxxxxxx.
8.10 Documents and Records. Xxxxxxx has provided to Sangamo materially complete and accurate
copies of all documents requested by Sangamo. Xxxxxxx has provided Sangamo or Sangamo’s
Representatives with full and complete access to all of Xxxxxxx’ material records, documents and
data that relate primarily to the Assets including all material records, documents or other data
requested in writing by Sangamo as part its of its review and diligence.
8.11 Disclaimer. EXCEPT AS EXPRESSLY SET FORTH IN THIS ARTICLE 8, THE ASSETS ARE SOLD AND THE
ASSUMED LIABILITIES ARE TRANSFERRED HEREBY ON AN “AS IS, WHERE IS” BASIS, AND XXXXXX MAKES NO
REPRESENTATIONS AND EXTENDS NO WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED, WRITTEN OR ORAL,
AND HEREBY TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW DISCLAIMS ANY SUCH REPRESENTATION OR
WARRANTY (INCLUDING, WITHOUT LIMITATION, ANY WARRANTIES OF INFRINGEMENT, TITLE, MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE), WHETHER BY XXXXXX, ITS AFFILIATES OR ANY OF ITS OR THEIR
OFFICERS, DIRECTORS, MEMBERS, PRINCIPALS, EMPLOYEES, AGENTS, MEMBERS OR REPRESENTATIVES OR ANY
OTHER PERSON, WITH RESPECT TO THE ASSETS AND THE ASSUMED LIABILITIES OR THE EXECUTION AND DELIVERY
OF THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
ARTICLE 9
REPRESENTATIONS AND WARRANTIES OF SANGAMO
Sangamo represents and warrants as follows:
9.1 Due Organization. Sangamo is a corporation duly organized under the laws of the State of
Delaware, and has all necessary power and authority to conduct its business in the manner in which
it is currently being conducted. Sangamo is duly qualified to do business and is in good standing
as a foreign corporation in each jurisdiction where the ownership or operation of its assets or the
conduct of its business requires such qualification, except for failures to be so qualified or in
good standing, as the case may be, that would not individually or in the aggregate have a material
adverse effect on Sangamo.
9.2 Authority; Binding Nature of Agreement. Sangamo has the right, power and authority to
enter into and perform its obligations under this Agreement. The execution, delivery and
performance of this Agreement by Sangamo have been duly authorized by all necessary corporate
action on the part of Sangamo. Assuming due execution by Xxxxxxx, this Agreement constitutes the
legal, valid and binding obligation of Sangamo, enforceable against Sangamo in accordance with its
terms, subject to (a) laws of general application relating to bankruptcy, insolvency and the relief
of debtors, and (b) rules of law governing specific performance, injunctive relief and other
equitable remedies.
27
9.3 Non-Contravention. The execution and delivery of this Agreement, and the consummation or
performance of any of the obligations under this Agreement by Sangamo do not and will not (with or
without notice or lapse of time):
(a) contravene, conflict with or result in a violation of (i) any of the provisions of
Sangamo’s Certificate of Incorporation or bylaws or (ii) any resolution adopted by Sangamo’s Board
of Directors (or any committee thereof) or stockholders;
(b) contravene, conflict with or result in a violation of any Legal Requirement to which
Sangamo or any of the assets owned or used by Sangamo is subject; or
(c) to the Knowledge of Sangamo, result in or give any other Person the right or option to
cause or declare a breach of any material Contract to which Sangamo is a party, wherein such breach
would have a material adverse effect on Sangamo.
9.4 Capitalization.
(a) As of November 30, 2006, the authorized capital stock of Sangamo consists of 80,000,000
shares of common stock, par value $0.01 per share, of which 34,993,155 shares were issued and
outstanding as of such date, and zero shares of preferred stock, par value $0.01 per share, of
which no shares are issued and outstanding. The authorized and outstanding shares of Sangamo’s
capital stock have not and shall not have materially changed during the period between September
30, 2006 and the Closing Date. All of such outstanding shares are or have been, and all of the
Shares to be issued to Xxxxxxx, when so issued, will be, duly authorized, validly issued, fully
paid and nonassessable, free of any preemptive right, pledge, hypothecation, assignment,
encumbrance, lien (statutory or other), charge or other security interest or matter affecting title
or ownership, whether created by statute, Sangamo’s Certificate of Incorporation or bylaws or any
Contract to which Sangamo is a party or by which Sangamo is bound, and issued in compliance with
all applicable state and federal laws concerning the issuance of securities. No stockholder
approval or any other approvals are required for the issuance of the Shares to be issued to
Xxxxxxx, and Sangamo has reserved such Shares for issuance to Xxxxxxx.
(b) Except as disclosed in Sangamo SEC Documents or as set forth on Schedule 9.4(b),
(i) no option, warrant, call, subscription right, conversion right or other contract or commitment
of any kind exists of any character, written or oral, which may obligate Sangamo to issue or sell
any shares of capital stock, or by which any shares of capital stock may otherwise become
outstanding, and (ii) Sangamo has no obligation (contingent or otherwise) to purchase, redeem or
otherwise acquire any of its equity securities or any interests therein or to pay any dividend or
make any distribution in respect thereof.
9.5 SEC Documents and Other Reports. Sangamo has filed all required documents with the SEC
since December 31, 2005 (“Sangamo SEC Documents”). As of their respective dates, Sangamo SEC
Documents complied in all material respects with the requirements of the Securities Act and the
Exchange Act and, at the respective times they were filed, none of Sangamo SEC Documents contained
any untrue statement of a material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein, in light of
28
the circumstances under which they were made, not misleading. The consolidated financial
statements (including, in each case, any notes thereto) of Sangamo included in Sangamo SEC
Documents complied as to form in all material respects with applicable accounting requirements and
the published rules and regulations of the SEC with respect thereto, were prepared in accordance
with GAAP (except, in the case of the unaudited statements, as permitted by Form 10-Q of the SEC)
applied on a consistent basis during the periods involved (except as may be indicated therein or in
the notes thereto) and fairly presented in all material respects the consolidated financial
position of Sangamo and its consolidated Subsidiaries as at the respective dates thereof and the
consolidated results of their operations and their consolidated cash flows for the periods then
ended (subject, in the case of unaudited statements, to normal year-end audit adjustments and to
any other adjustments described therein). Except as disclosed in Sangamo SEC Documents or as
required by generally accepted accounting principles, Sangamo has not, since December 31, 2005,
made any change in the accounting practices or policies applied in the preparation of financial
statements.
9.6 Absence of Certain Changes or Events. Except as disclosed in Sangamo SEC Documents filed
with the SEC prior to the date of this Agreement, since December 31, 2005, there has been no event
or development that would, individually or in the aggregate, have a material adverse effect on
Sangamo (other than any events that arise primarily as a result of the announcement of this
Agreement and the transactions contemplated hereby).
9.7 Compliance with Legal Requirements; Litigation.
(a) Except as set forth on Schedule 9.7(a) and except as would not individually or in
the aggregate have a material adverse effect with respect to the business of Sangamo, Sangamo is in
compliance with all applicable Legal Requirements.
(b ) Except as set forth on Schedule 9.7(b), no judgment, order, writ, injunction or
decree of any Governmental Authority that is related to Sangamo is in effect nor is any action,
claim, suit, arbitration, inquiry, investigation or other proceeding of any nature (whether
criminal, civil, legislative, administrative, regulatory, prosecutorial or otherwise) by or before
any arbitrator or Governmental Authority with respect to Sangamo’s operations pending or, to the
Knowledge of Sangamo, threatened, in each case as would individually or in the aggregate have a
material adverse effect with respect to Sangamo.
9.8 Access to Information; Independent Due Diligence.
(a) Sangamo has had the opportunity to conduct due diligence with respect to the Assets and to
inspect the Assets. Sangamo has been afforded the opportunity to review all information provided
to it by Xxxxxxx and has had the opportunity to ask questions of and receive answers to its
satisfaction from representatives of Xxxxxxx concerning the Assets, and to obtain any additional
information reasonably requested by it; and
(b) Sangamo, either alone or together with any individuals or entities Sangamo has retained to
advise it with respect to the transactions contemplated hereby, has knowledge and experience in
transactions of this type and in the business related to the Assets, and is therefore capable of
evaluating the risks and merits of acquiring the Assets.
29
9.9 Disclaimer. EXCEPT AS EXPRESSLY SET FORTH IN THIS ARTICLE 9, SANGAMO MAKES NO
REPRESENTATIONS AND EXTENDS NO WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED, WRITTEN OR ORAL,
AND HEREBY TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW DISCLAIMS ANY SUCH REPRESENTATION OR
WARRANTY, WHETHER BY SANGAMO, ITS AFFILIATES OR ANY OF ITS OR THEIR OFFICERS, DIRECTORS,
STOCKHOLDERS, PRINCIPALS, EMPLOYEES, AGENTS, MEMBERS OR REPRESENTATIVES OR ANY OTHER PERSON, WITH
RESPECT TO THE EXECUTION AND DELIVERY OF THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
ARTICLE 10
CONDITIONS PRECEDENT TO CLOSING
10.1 Conditions to Obligations of Sangamo. The obligations of Sangamo to complete the
transactions contemplated by this Agreement at the Closing are subject to the satisfaction of the
following conditions, unless waived by Sangamo:
(a) Representations and Warranties; Performance of Obligations. The representations and
warranties made by Xxxxxxx in Article 8 shall be true and correct in all material respects as of
the date of this Agreement and on the Closing Date, with the same force and effect as if they had
been made on and as of said date; provided, however, that if any portion of any
such representation or warranty is already qualified by materiality, for purposes of determining
whether this condition has been satisfied with respect to such portion of such representation or
warranty, such portion of such representation or warranty as so qualified shall be true and correct
in all respects. Xxxxxxx shall have performed and complied with all obligations, covenants and
conditions herein required to be performed or complied with by it on or prior to the Closing Date.
(b) No Material Adverse Effect. There shall not have occurred any event that would have a
material adverse effect on the Assets taken as a whole.
(c) Required Consents. On or prior to the Closing, Xxxxxxx shall have obtained all applicable
authorizations, consents, orders and approvals of all Governmental Authorities.
(d) Compliance Certificate. Xxxxxxx shall have delivered to Sangamo a compliance certificate
executed by an officer of Xxxxxxx, dated as of the Closing Date, certifying to the fulfillment of
the conditions specified in Sections 10.1(a), (b) and (c).
(e) Services. The completion by Xxxxxxx of (i) delivery of the items identified on2
Schedule 6.1, to the extent such items are indicated as being deliverable prior to the
Closing Date, and (ii) disclosure of Assigned Know-How pursuant to Section 6.4.
(f) No Injunction. Neither Xxxxxxx nor Sangamo shall be subject to any statute, rule or
regulation or any final order, decree or injunction of a court of competent jurisdiction that (i)
renders any transaction contemplated by this Agreement illegal, (ii) would impose any material
limitation on the ability of Sangamo effectively to exercise full rights of ownership of the Assets, or (iii) renders Xxxxxxx or Sangamo incapable of completing the
transactions contemplated by this Agreement.
30
(g) No Pending Legal Action. No litigation seeking the issuance of a final order, decree or
injunction of a court of competent jurisdiction for relief against Xxxxxxx or Sangamo if the
transactions contemplated by this Agreement are completed, shall be pending which, in the good
faith judgment of Sangamo has a reasonable probability of resulting in such order, decree or
injunction and such relief would have a material adverse effect on the Assets.
10.2 Conditions to Obligations of Xxxxxxx. Subject to Section 10.3, the obligations of
Xxxxxxx to complete the transactions contemplated by this Agreement at the Closing are subject to
the satisfaction of the following conditions, unless waived by Xxxxxxx:
(a) Representations and Warranties; Performance of Obligations. The representations and
warranties made by Sangamo in Article 9 shall be true and correct in all material respects as of
the date of this Agreement and on the Closing Date, with the same force and effect as if they had
been made on and as of said date (except to the extent that such representations and warranties are
made as of a specified date, in which case such representations and warranties shall be true and
correct in all material respects as of such specified date); provided, however,
that if any portion of any such representation or warranty is already qualified by materiality, for
purposes of determining whether this condition has been satisfied with respect to such portion of
such representation or warranty, such portion of such representation or warranty as so qualified
shall be true and correct in all respects. Sangamo shall have performed and complied with all
obligations, covenants and conditions herein required to be performed or complied with by it on or
prior to the Closing Date.
(b) No Material Adverse Effect. Other than any events that arise primarily as a result of the
announcement of this Agreement and the transactions contemplated hereby, there shall not have
occurred any event that would have a material adverse effect on Sangamo.
(c) Required Consents. On or prior to the Closing, Sangamo shall have obtained all applicable
authorizations, consents, orders and approvals of all Governmental Authorities.
(d) Compliance Certificate. Sangamo shall have delivered to Xxxxxxx a compliance certificate
executed by an officer of Sangamo, dated as of the Closing Date, certifying to the fulfillment of
the conditions specified in Sections 10.2(a), (b) and (c).
(e) No Injunction. Neither Sangamo nor Xxxxxxx shall be subject to any statute, rule or
regulation or any final order, decree or injunction of a court of competent jurisdiction that (i)
renders any transaction contemplated by this Agreement illegal, (ii) would impose any material
limitation on the ability of Xxxxxxx effectively to exercise full rights of ownership of the
Assets, or (iii) renders Sangamo or Xxxxxxx incapable of completing the transactions contemplated
by this Agreement.
(f) No Pending Legal Action. No litigation seeking the issuance of a final order, decree or
injunction of a court of competent jurisdiction for relief against Sangamo or Xxxxxxx if the
transactions contemplated by this Agreement are completed, shall be pending which, in the good faith judgment of Xxxxxxx has a reasonable probability of resulting in such
order, decree or injunction and such relief would have a material adverse effect on the Assets.
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10.3 Closing Upon Notice from Sangamo. Regardless whether the conditions set forth in
Sections 10.1 and 10.2 have been met, Sangamo can cause the Closing to occur by sending written
notice to the Escrow Agent, with a copy to Xxxxxxx, specifying a date no later than December 31,
2006 on which the Escrow Agent shall release the Shares to Xxxxxxx and the executed Escrowed
Agreements to the Parties. If, as a result of Sangamo’s notice pursuant to this Section 10.3,
Closing occurs at a time when Xxxxxxx has not completed its obligations pursuant to Sections 6.1,
6.3 and 6.4, Xxxxxxx’ obligation to perform such actions shall survive the Closing, and Sangamo’s
obligations under the Assumed Contracts shall not include any obligation that it is unable to
perform because of Xxxxxxx’ failure to complete its obligations pursuant to Sections 6.1, 6.3 or
6.4. In the event that a Required Third Party Consent has not been obtained in connection with an
Assumed Contract, Xxxxxxx and Sangamo shall use commercially reasonable efforts to work together to
provide the benefit of any such Assumed Contract to Sangamo until such Required Third Party Consent
is obtained.
ARTICLE 11
INDEMNIFICATION
11.1 Survival of Representations and Covenants.
(a) Subject to Section 11.1(b), the representations and warranties of Xxxxxxx set forth in
this Agreement shall survive (without limitation): (i) the Closing Date and the sale of the Assets
to Sangamo; (ii) any sale or other disposition of any or all of the Assets by Sangamo; and (iii)
the dissolution or liquidation of any Party. The covenants and agreements of each Party set forth
in this Agreement shall survive indefinitely unless a covenant or agreement, by its nature or as
specified herein, has a limited survival period.
(b) The representations and warranties of each Party set forth in this Agreement shall expire
on the first anniversary of the Closing Date; provided, however, the
representations and warranties contained in Section 8.2(a) shall survive until expiration of the
applicable statute of limitations. Neither Party shall have any liability whatsoever with respect
to any such representation or warranty unless a Claim Notice is delivered by the other Party prior
to the expiration of the survival period applicable to such representation or warranty.
(c) For purposes of this Agreement, a “Claim Notice” relating to a particular representation
or warranty shall be deemed to have been given if any Indemnitee, acting in good faith, delivers to
Xxxxxxx or Sangamo, as applicable, a written notice stating that such Indemnitee believes that
there is or has been a possible Breach of such representation or warranty and containing (i) a
brief description of the circumstances supporting such Indemnitee’s belief that there is or has
been such a possible Breach, and (ii) a non-binding, preliminary estimate of the aggregate dollar
amount of the actual and potential Damages that have arisen and may arise as a direct or indirect
result of such possible Breach.
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(d) For purposes of this Agreement, each statement or other item of information set forth in
any Schedule shall be deemed to be a representation and warranty made by Xxxxxxx in this Agreement.
11.2 Indemnification by Xxxxxxx.
(a) Xxxxxxx shall hold harmless and indemnify each of the Sangamo Indemnitees from and
against, and shall compensate and reimburse each of the Sangamo Indemnitees for, any Damages that
are suffered or incurred by such Sangamo Indemnitee and that arise from or as a result of, or are
connected with:
(i) any Breach, during the applicable survival period set forth in Section 10.1, of any
of the representations or warranties made by Xxxxxxx in this Agreement as of the Closing
Date;
(ii) any Breach of any covenant or obligation of Xxxxxxx contained in this Agreement;
(iii) Xxxxxxx’ failure to discharge any Liability of Xxxxxxx, other than the Assumed
Liabilities; or
(iv) any Excluded Assets.
(b) Subject to Section 11.2(c), Xxxxxxx shall not be required to make any indemnification
payment pursuant to Section 11.2(a) until such time as the total amount of all Damages that have
been suffered or incurred by any one or more of the Sangamo Indemnitees exceeds $50,000, and then
only to the extent of any such excess.
(c) The total amount of the indemnification payments that Xxxxxxx shall be required to make
under or in connection with this Section 11.2 shall be limited in the aggregate to an amount equal
to thirty percent (30%) of the aggregate value of the Shares based on the closing price of the
Common Stock on the Closing Date.
(d) Notwithstanding the foregoing, the limitations set forth in paragraphs (b) and (c) above
shall not apply to any claims for Damages made pursuant to clause (ii), (iii), (iv) or (v) of
Section 11.2(a).
11.3 Indemnification by Sangamo. Sangamo shall hold harmless and indemnify each of the
Xxxxxxx Indemnitees from and against, and shall compensate and reimburse each of the Xxxxxxx
Indemnitees for, any Damages that are suffered or incurred by such Xxxxxxx Indemnitee and that
arise from or as a result of, or are connected with:
(a) any Breach, during the applicable survival period set forth in Section 11.1, of any of the
representations or warranties made by Sangamo in this Agreement as of the Closing Date (or in case
of representations or warranties made by Sangamo in any Exhibits and Schedules amended pursuant to
this Agreement, as of the date of such amendment);
33
(b) any Breach of any covenant or obligation of Sangamo contained in this Agreement; or
(c) Sangamo’s failure to discharge any Assumed Liability.
11.4 No Setoff. Under no circumstances shall Sangamo have the right to withhold or deduct any
sum owed to any Sangamo Indemnitee under Section 11.2 from any amount otherwise payable by any
Sangamo Indemnitee to Xxxxxxx.
11.5 Exclusivity of Indemnification Remedies. Each Party acknowledges and agrees that its
sole and exclusive remedy with respect to any and all claims relating to matters addressed by any
representation or warranty made pursuant to this Agreement shall be brought pursuant to the
indemnification provisions set forth in this Article 11. Notwithstanding the foregoing, nothing in
this Section 11.5 or elsewhere in this Agreement shall be deemed to limit any Party’s right to seek
specific performance or other equitable relief in any court of competent jurisdiction of its rights
and remedies hereunder.
11.6 Indemnification Procedure for Third Party Claims.
(a) Each Party will notify the other Party in writing in the event it becomes aware of a Third
Party claim for which indemnification may be sought hereunder. In case any proceeding shall be
instituted involving any Person in respect of which indemnity may be sought pursuant to this
Article 11, such Person (the “Indemnified Party”) shall promptly notify the other Party (the
“Indemnifying Party’) in writing and the Indemnifying Party and Indemnified Party shall meet to
discuss how to respond to any claims that are the subject matter of such proceeding;
provided, however, that failure to provide such notification shall not affect the
indemnification provided hereunder except to the extent the Indemnifying Party shall have been
actually prejudiced as a result of such failure (except that the Indemnifying Party shall not be
liable for any expenses incurred during the period in which the Indemnified Party failed to give
such notice). The Parties shall cooperate in defense of such matter.
(b) If a Third Party claim is made against an Indemnified Party, the Indemnifying Party shall
be entitled to participate in the defense thereof and, if it so chooses and acknowledges its
obligation to indemnify the Indemnified Party therefor, to assume the defense thereof with counsel
selected by the Indemnifying Party. Should the Indemnifying Party so elect to assume the defense
of a Third Party claim, the Indemnifying Party shall not be liable to the Indemnified Party for
legal expenses subsequently incurred by the Indemnified Party in connection with the defense
thereof. If the Indemnifying Party assumes such defense, the Indemnified Party shall have the
right to participate in the defense thereof and to employ counsel, at its own expense, separate
from the counsel employed by the Indemnifying Party, it being understood that the Indemnifying
Party shall control such defense. The Indemnifying Party shall be liable for the fees and expenses
of counsel employed by the Indemnified Party for any period during which the Indemnifying Party has
failed to assume the defense thereof (other than during the period prior to the time the
Indemnified Party shall have given notice of the Third Party claim as provided above).
34
(c) If the Indemnifying Party so elects to assume the defense of any Third Party claim, all of
the Indemnified Parties shall cooperate with the Indemnifying Party in the defense or prosecution
thereof. Such cooperation shall include the retention and (upon the Indemnifying Party’s request)
the provision to the Indemnifying Party of records and information that are reasonably relevant to
such Third Party claim, and making employees available on a mutually convenient basis to provide
additional information and explanation of any material provided hereunder. Whether or not the
Indemnifying Party shall have assumed the defense of a Third Party claim, the Indemnified Party
shall not admit any liability with respect to, or settle, compromise or discharge, such Third Party
claim without the Indemnified Party’s prior written consent (which consent shall not be
unreasonably withheld or delayed). If the Indemnifying Party shall have assumed the defense of a
Third Party claim, the Indemnified Party shall agree to any settlement, compromise or discharge of
a Third Party claim which the Indemnifying Party may recommend and which by its terms obligates the
Indemnifying Party to pay the full amount of the liability in connection with such Third Party
claim, and which releases the Indemnifying Party completely in connection with such Third Party
claim.
11.7 Insurance. Each Party shall obtain by the Closing Date and shall maintain at all times
thereafter in which it is performing a Clinical Trial or otherwise developing or commercializing a
Product and for five (5) years thereafter, Products Liability Insurance with reputable and
financially secure insurance carriers each having an A.M. Best rating of A-VII or better, to cover
its indemnification obligations under Article 11, with respect to third party claims for bodily
injury or property damage resulting from Clinical Trials, with limits of not less than five million
dollars ($5,000,000.00) per occurrence and ten million dollars ($10,000,000.00) in the aggregate.
Each Party shall provide the other Party with a Certificate of Insurance evidencing this coverage
within thirty (30) days after the relevant deadline for obtaining such coverage.
ARTICLE 12
TERM AND TERMINATION
12.1 Term. The terms and conditions of this Agreement will commence on the Signing Date and
will continue in full force and effect indefinitely unless this Agreement is terminated pursuant to
Section 12.2.
12.2 Termination. This Agreement may be terminated at any time prior to the Closing Date:
(a) by mutual written consent of the Parties;
(b) by Sangamo (provided that Sangamo is not in material breach of this Agreement), if
there has been a breach by Xxxxxxx of any representation, warranty, covenant or agreement set forth
in this Agreement on the part of Xxxxxxx which is material and which Xxxxxxx fails to cure within
15 days after written notice thereof is given by Sangamo (except that no cure period will be
provided for a breach by Xxxxxxx which by its nature cannot be cured);
35
(c) by Xxxxxxx (provided that Xxxxxxx is not in material breach of this Agreement), if
there has been a breach by Sangamo of any representation, warranty, covenant or agreement set forth
in this Agreement on the part of Sangamo which is material and which Sangamo fails to cure or
provide written notice pursuant to Section 10.3 within 15 days after written notice thereof is
given by Xxxxxxx (except that no cure period will be provided for a breach by Sangamo which by its
nature cannot be cured);
(d) by either Party, by giving written notice to the other Party, if the Closing has not
occurred on or before December 31, 2006, except that neither Party will have the right to terminate
this Agreement unilaterally if it has failed to use commercially reasonable efforts (to the extent
that such obligation is not already subject to a commercially reasonable standard) to fulfill the
obligations set forth in Article 10 and such party’s failure to fulfill any of its obligations
under this Agreement is the reason for the failure of the Closing to occur by such date; or
(e) by either Party if a court of competent jurisdiction or any Governmental Authority has
issued a final non-appealable order, decree or ruling, or taken any other action, having the effect
of permanently restraining, enjoining or otherwise prohibiting any of the transactions contemplated
by this Agreement.
12.3 Effect of Termination. In the event of the termination of this Agreement pursuant to any
paragraph of Section 12.2, the obligations of the Parties to complete the transactions contemplated
by this Agreement shall expire and none of the Parties shall have any further obligations under
this Agreement. Notwithstanding the foregoing, (a) in the event of the termination of this
Agreement pursuant to any paragraph of Section 12.2 that is caused by a breach of a Party, the
Party whose breach was the basis for the termination will not be relieved from any liability for
its breach hereof, and the other Party will have no further obligations under this Agreement, and
(b) the rights and obligations of each Party under Article 11 (Indemnification) will survive and
continue, if applicable.
ARTICLE 13
CONFIDENTIALITY
13.1 Non-Disclosure and Non-Use.
(a) Except to the extent expressly authorized by this Agreement or otherwise agreed in
writing, Xxxxxxx and its Affiliates agree to keep confidential, and not to publish or otherwise
disclose or use for any purpose other than as provided for in this Agreement, any Sangamo
Confidential Information.
(b) Except to the extent expressly authorized by this Agreement or otherwise agreed in
writing, Sangamo agrees to keep confidential, and not to publish or otherwise disclose or use for
any purpose other than as provided for in this Agreement, any Xxxxxxx Confidential Information.
36
13.2 Authorized Disclosure.
(a) Each Party may disclose Confidential Information of the other Party to the extent such
disclosure is required by an order of a court or other government agency or is required to comply
with applicable governmental regulations; provided, however, that if a Party is
required by court order, law or regulation to make any such disclosures of the other Party’s
Confidential Information it will give reasonable advance notice to the other Party sufficient to
allow such other Party to seek confidential treatment of such Confidential Information.
(b) Xxxxxxx may disclose Sangamo Confidential Information, without prior notice to Sangamo,
(i) in connection with the performance of the Know-How Transfer described in Section 6.4, to its
employees and consultants who need to know such information to perform such Know-How Transfer, and
(ii) to existing or potential acquirers or merger candidates, each of whom prior to disclosure must
be subject to a binding confidentiality agreement.
(c) Sangamo may disclose Xxxxxxx Confidential Information, without prior notice to Xxxxxxx,
(i) in connection with the research, development and manufacture of the Products or in the
performance of this Agreement, to its Affiliates, permitted sublicensees, employees, consultants,
representatives or agents who need to know such information for such purposes, and (ii) to existing
or potential acquirers or merger candidates, potential collaborators, investment bankers, existing
or potential investors, venture capital firms or other financial institutions or investors for
purposes of obtaining financing, each of whom prior to disclosure must be subject to a binding
confidentiality agreement.
13.3 Publicity. The Parties agree that the public announcement of the execution of this
Agreement shall be substantially in the form of the press release to be mutually agreed to by the
Parties. Thereafter, either Party may issue any other publication, news release or other public
announcement referring to the other Party relating to this Agreement, or such other Party’s
performance hereunder, under the License Agreement or under the Research Funding Agreement.
Notwithstanding the foregoing, either Party may issue a press release or make other public
announcements, without the prior approval of the other Party, if the disclosure concerning this
Agreement is limited to text previously approved by the other Party or previously disclosed
pursuant to a disclosure permitted by this Section 13.3.
ARTICLE 14
LIMITATIONS ON REMEDIES
14.1 Consequential Damages. IN NO EVENT WILL EITHER PARTY OR ITS AFFILIATES BE LIABLE FOR
SPECIAL, PUNITIVE, TREBLE OR CONSEQUENTIAL DAMAGES, WHETHER BASED ON CONTRACT, TORT OR ANY OTHER
LEGAL THEORY; PROVIDED, HOWEVER, THAT THIS LIMITATION WILL NOT LIMIT THE
INDEMNIFICATION OBLIGATION OF SUCH PARTY UNDER THE PROVISIONS OF ARTICLE 11 FOR SUCH DAMAGES
CLAIMED BY A THIRD PARTY OR A PARTY’S LIABILITY FOR BREACH OF ITS OBLIGATIONS UNDER ARTICLE 13.
37
14.2 Remedies. Nothing in this Agreement will limit either Party’s right to seek immediate
injunctive or other equitable relief whenever the facts or circumstances would permit a Party to
seek such relief in a court of competent jurisdiction.
ARTICLE 15
MISCELLANEOUS
15.1 Assignment. Neither Party may assign its rights or obligations under this Agreement
without the prior written consent of the other Party; provided, however, that
either Party may make such an assignment without prior written consent in connection with the
merger or acquisition of such Party or the sale of substantially all of its assets. This Agreement
shall be binding upon and inure to the benefit of the permitted assigns of the Parties. Any
assignment not in accordance with this Agreement shall be void.
15.2 Notices. All notices hereunder shall be in writing and shall be deemed given if
delivered personally or by facsimile transmission (receipt verified), telexed, mailed by registered
or certified mail (return receipt requested), postage prepaid, or sent by express courier service,
to the Parties at the following addresses (or at such other address for a Party as shall be
specified by like notice; provided that notices of a change of address shall be effective
only upon receipt thereof). Notice shall become effective upon receipt.
If to Sangamo:
|
Sangamo BioSciences, Inc. | |
Point Richmond Tech Center | ||
000 Xxxxx Xxxxxxxxx, Xxxxx X000 | ||
Xxxxxxxx, XX 00000 | ||
Attention: Chief Executive Officer | ||
Facsimile: (000) 000-0000 | ||
With a copy to:
|
Cooley Godward Kronish LLP | |
Five Palo Alto Square | ||
0000 Xx Xxxxxx Xxxx | ||
Xxxx Xxxx, XX 00000 | ||
Attention: Xxxxx X. Xxxxxxx, Esq. | ||
Facsimile: (000) 000-0000 | ||
If to Xxxxxxx:
|
Xxxxxxx Lifesciences LLC | |
c/o Edwards Lifesciences Corporation | ||
Xxx Xxxxxxx Xxx | ||
Xxxxxx, XX 00000 | ||
Attention: General Counsel | ||
Facsimile: (000) 000-0000 | ||
With a copy to:
|
Xxxxxx, Xxxx & Xxxxxxxx LLP | |
0 Xxxx Xxxxx | ||
Xxxxxx, XX 00000 | ||
Attention: Xxxx X. Xxxxxxxx, Esq. | ||
Facsimile: (000) 000-0000 |
38
15.3 Waiver. Except as specifically provided for herein, the waiver from time to time by
either of the Parties of any of their rights or their failure to exercise any remedy shall not
operate or be construed as a continuing waiver of same or any other of such Party’s rights or
remedies provided in this Agreement.
15.4 Severability. If any term, covenant or condition of this Agreement or the application
thereof to any Party or circumstances shall, to any extent, be held to be invalid or unenforceable,
then (a) the remainder of this Agreement, or the application of such term, covenant or condition to
the Parties or circumstances other than those as to which it is held invalid or unenforceable,
shall not be affected thereby and each term, covenant or condition of this Agreement shall be valid
and be enforced to the fullest extent permitted by law; and (b) the Parties covenant and agree to
renegotiate any such term, covenant or application thereof in good faith in order to provide a
reasonably acceptable alternative to the term, covenant or condition of this Agreement or the
application thereof that is invalid or unenforceable, it being the intent of the Parties that the
basic purposes of this Agreement are to be effectuated.
15.5 Ambiguities; Interpretation. Ambiguities, if any, in this Agreement shall not be
construed against any Party, irrespective of which Party may be deemed to have authored the
ambiguous provision. Whenever the words “include”, “includes” or “including” are used in this
Agreement, they shall be deemed, as the context indicates, to be followed by the words “without
limitation”.
15.6 Governing Law; Jurisdiction; Attorneys’ Fees.
(a) This Agreement shall be governed by and interpreted under the laws of the State of
California, without regard to conflicts of laws, except for questions regarding patents, which
shall be resolved in the United States courts having jurisdiction over the matter.
(b) The Parties will try to settle their differences amicably between themselves. If any
Dispute arises between the Parties, then a Party may notify the other Party in writing of such
Dispute. If such Dispute is not resolved within ten (10) days of such notice, the Parties hereby
agree to resolve such Dispute by referring the Dispute to their chief executive officers or their
designees, for attempted resolution by negotiations within fifteen (15) days after such notice of
Dispute is received.
(c) In the event the chief executive officers or their designees are unable to resolve such
Dispute within the fifteen (15) day period provided for in Section 15.6(b), then either Party may
bring an action or suit to resolve such Dispute provided that: (i) the sole forum for
resolving such Disputes shall be the state courts located in San Francisco County, California, and
each Party hereby irrevocably submits to such exclusive jurisdiction, (ii) EACH OF THE PARTIES
HERETO IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT
OF OR RELATING TO THIS AGREEMENT, and (iii) the prevailing Party in such action or dispute, whether
by final judgment, or out of court settlement shall be entitled to recover from the non-prevailing
Party all costs and expenses of suit, including actual attorneys’ fees. Any judgment or order
entered in any final judgment shall contain a specific provision providing for the recovery of all
costs and expenses of suit, including actual attorneys’ fees incurred in enforcing, perfecting and
executing such judgment.
39
15.7 Headings. The Sections and paragraph headings contained herein are for the purposes of
convenience only and are not intended to define or limit the contents of the Sections or paragraphs
to which they apply.
15.8 Facsimile Execution; Counterparts. This Agreement may be executed by facsimile and in
one or more counterparts, each of which shall be deemed an original, but all of which together
shall constitute one and the same instrument.
15.9 Entire Agreement; Amendments.
(a) This Agreement, including all addendums, exhibits, schedules and attachments attached
hereto, each of which is hereby incorporated hereinto, sets forth all the covenants, promises,
agreements, warranties, representations, conditions and understandings between the Parties with
respect to the subject matter hereof, and supersedes and terminates all prior agreements and
understandings between the Parties with respect to such subject matter. There are no covenants,
promises, agreements, warranties, representations, conditions or understandings, either oral or
written, between the Parties with respect to such subject matter other than as set forth in this
Agreement as described above.
(b) No alteration, amendment, change or addition to this Agreement shall be binding upon the
Parties hereto unless reduced to writing and signed by the respective authorized officers of the
Parties. This Agreement, including the addendums, exhibits, schedules and attachments hereto, is
intended to define the full extent of the legally enforceable undertakings of the Parties with
respect to the subject matter hereof, and no promise or representation, written or oral, which is
not set forth explicitly is intended by either Party to be legally binding. Both Parties
acknowledge that in deciding to enter into the Agreements and to consummate the transaction
contemplated thereby neither Party has relied upon any statement or representations, written or
oral, other than those explicitly set forth herein.
15.10 Independent Contractors. The status of the Parties under this Agreement shall be that
of independent contractors. Neither Party shall have the right to enter into any agreements on
behalf of the other Party, nor shall it represent to any person that it has any such right or
authority. Nothing in this Agreement shall be construed as establishing a partnership or joint
venture relationship between the Parties.
15.11 Currency. The references in this Agreement to amounts expressed in dollars ($) means
United States dollars.
15.12 Bankruptcy. All rights and licenses granted by Xxxxxxx under or pursuant to this
Agreement are, and shall otherwise be deemed to be, for purposes of Section 365(n) of Title
40
11, U.S.C. (the “Bankruptcy Code”), licenses and rights to “Intellectual Property” as defined
under Section 101(35A) of the Bankruptcy Code. Xxxxxxx agrees that Sangamo, as a licensee of such
rights under this Agreement, shall retain and may fully exercise all of its rights and elections
under the Bankruptcy Code. Xxxxxxx agrees to provide to Sangamo, on or before the Closing Date,
current copies of or, if not amenable to copying, detailed descriptions or other appropriate
embodiments, of all Assigned Intellectual Property. The Parties further agree that, in the event
of the commencement of a bankruptcy proceeding by or against Xxxxxxx under the Bankruptcy Code,
Sangamo shall be entitled to a complete duplicate of (or complete access to, as appropriate) any
such intellectual property and all embodiments of such intellectual property and the same, if not
already in its possession, shall be promptly delivered to Sangamo (a) upon any such commencement of
a bankruptcy proceeding upon written request therefor by Sangamo, unless Xxxxxxx elects to continue
to perform all of its obligations under this Agreement, or (b) if not delivered under (a) above,
upon the rejection of this Agreement by or on behalf of Xxxxxxx upon written request therefor by
Sangamo. Any delivery of descriptions or embodiments of the Assigned Intellectual Property
pursuant to this Section 15.12 shall not be deemed to effect a transfer of title or other change in
ownership or license rights, or to reduce in any respect the payment obligations of Sangamo under
this Agreement.
15.13 Force Majeure. No failure or omission by the Parties in the performance of any
obligation of this Agreement shall be deemed a breach of this Agreement or create any liability if
the same shall arise from any cause or causes beyond the reasonable control of the Parties,
including the following: acts of God; acts or omissions of any government; any rules, regulations
or orders issued by any governmental authority or by any officer, department, agency or
instrumentality thereof; fire; storm; flood; earthquake; accident; war; rebellion; terrorism;
insurrection; riot; and invasion; and provided that such failure or omission resulting from
one of the above causes is cured as soon as is practicable after the occurrence of one or more of
the above-mentioned causes. The Party claiming force majeure shall notify the other Party with
notice of the force majeure event as soon as practicable, but in no event longer than ten (10)
business days after its occurrence, which notice shall reasonably identify such obligations under
this Agreement and the extent to which performance thereof will be affected.
[Signature Page Follows]
41
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed as of the date first
written above by their respective duly authorized officers.
Xxxxxxx Lifesciences LLC |
||||
By: | /s/ Xxxx X. Xxxx, Xx. | |||
Name: | Xxxx X. Xxxx, Xx. | |||
Title: | Corporate Vice President | |||
Sangamo BioSciences, Inc. |
||||
By: | /s/ Xxxx X. Zante | |||
Name: | Xxxx X. Zante | |||
Title: | Vice President, Finance |
42
ARTICLE 1
|
DEFINITIONS | 1 | ||||
ARTICLE 2
|
SIGNING DATE ACTIVITIES | 9 | ||||
2.1
|
SIGNING DATE | 9 | ||||
ARTICLE 3
|
PURCHASE AND SALE OF ASSETS | 9 | ||||
3.1
|
PURCHASE AND SALE OF ASSETS | 9 | ||||
3.2
|
EXCLUDED ASSETS | 10 | ||||
3.3
|
ASSUMED LIABILITIES | 11 | ||||
3.4
|
Taxes | 12 | ||||
3.5
|
Allocation | 12 | ||||
ARTICLE 4
|
INTELLECTUAL PROPERTY RIGHTS | 12 | ||||
4.1
|
TRADEMARKS | 12 | ||||
4.2
|
XXXXXXX COVENANT NOT TO ASSERT | 12 | ||||
ARTICLE 5
|
PAYMENTS | 12 | ||||
5.1
|
STOCK ESCROW | 12 | ||||
5.2
|
REGISTRATION RIGHTS | 13 | ||||
5.3
|
ROYALTIES | 16 | ||||
5.4
|
MAXIMUM ROYALTIES | 16 | ||||
5.5
|
ROYALTY REPORTS AND PAYMENTS | 17 | ||||
5.6
|
PAYMENT METHOD | 17 | ||||
5.7
|
EXCHANGE RATE | 17 | ||||
5.8
|
WITHHOLDINGS | 17 | ||||
5.9
|
RECORDS; AUDIT | 17 | ||||
ARTICLE 6
|
TRANSITION PERIOD COVENANTS | 18 | ||||
6.1
|
DELIVERY OF TANGIBLE ASSETS | 18 | ||||
6.2
|
ADDITIONAL DELIVERIES | 18 | ||||
6.3
|
CLINICAL TRIAL MATERIALS | 19 | ||||
6.4
|
KNOW-HOW TRANSFER | 19 | ||||
6.5
|
EMPLOYEES | 19 | ||||
6.6
|
ASSUMED CONTRACTS | 19 | ||||
6.7
|
OBSERVATION RIGHTS | 20 | ||||
6.8
|
REGULATORY MATTERS | 20 | ||||
6.9
|
ADVERSE DRUG EXPERIENCES | 21 | ||||
6.10
|
PRESERVATION OF ASSETS | 21 |
43
6.11
|
FURTHER ASSURANCES | 21 | ||||
ARTICLE 7
|
POST-CLOSING DATE COVENANTS | 21 | ||||
7.1
|
XXXXXXX CONTRACTS | 21 | ||||
7.2
|
ENROLLED PATIENTS | 22 | ||||
7.3
|
ADVERSE DRUG EXPERIENCES | 22 | ||||
7.4
|
REGULATORY MATTERS | 22 | ||||
7.5
|
New Data and Intellectual Property | 22 | ||||
7.6
|
POST-CLOSING DELIVERIES | 22 | ||||
7.7
|
CONSULTING AGREEMENTS | 22 | ||||
ARTICLE 8
|
REPRESENTATIONS AND WARRANTIES OF XXXXXXX | 23 | ||||
8.1
|
DUE ORGANIZATION | 23 | ||||
8.2
|
TITLE TO ASSETS | 23 | ||||
8.3
|
INTELLECTUAL PROPERTY | 23 | ||||
8.4
|
CLINICAL TRIAL MATERIALS | 25 | ||||
8.5
|
CONTRACTS | 25 | ||||
8.6
|
CLINICAL TRIALS | 26 | ||||
8.7
|
AUTHORITY; BINDING NATURE OF AGREEMENTS | 26 | ||||
8.8
|
NON-CONTRAVENTION | 26 | ||||
8.9
|
COMPLIANCE WITH LEGAL REQUIREMENTS; LITIGATION | 27 | ||||
8.10
|
DOCUMENTS AND RECORDS | 27 | ||||
8.11
|
DISCLAIMER | 27 | ||||
ARTICLE 9
|
REPRESENTATIONS AND WARRANTIES OF SANGAMO | 27 | ||||
9.1
|
DUE ORGANIZATION | 28 | ||||
9.2
|
AUTHORITY; BINDING NATURE OF AGREEMENT | 28 | ||||
9.3
|
NON-CONTRAVENTION | 28 | ||||
9.4
|
CAPITALIZATION | 28 | ||||
9.5
|
SEC DOCUMENTS AND OTHER REPORTS | 29 | ||||
9.6
|
ABSENCE OF CERTAIN CHANGES OR EVENTS | 29 | ||||
9.7
|
COMPLIANCE WITH LEGAL REQUIREMENTS; LITIGATION | 29 | ||||
9.8
|
ACCESS TO INFORMATION; INDEPENDENT DUE DILIGENCE | 30 | ||||
9.9
|
DISCLAIMER | 30 | ||||
ARTICLE 10
|
CONDITIONS PRECEDENT TO CLOSING | 30 | ||||
10.1
|
CONDITIONS TO OBLIGATIONS OF SANGAMO | 30 |
44
10.2
|
CONDITIONS TO OBLIGATIONS OF XXXXXXX | 31 | ||||
10.3
|
CLOSING UPON NOTICE FROM SANGAMO | 32 | ||||
ARTICLE 11
|
INDEMNIFICATION | 32 | ||||
11.1
|
SURVIVAL OF REPRESENTATIONS AND COVENANTS | 32 | ||||
11.2
|
INDEMNIFICATION BY XXXXXXX | 33 | ||||
11.3
|
INDEMNIFICATION BY SANGAMO | 34 | ||||
11.4
|
NO SETOFF | 34 | ||||
11.5
|
EXCLUSIVITY OF INDEMNIFICATION REMEDIES | 34 | ||||
11.6
|
INDEMNIFICATION PROCEDURE FOR THIRD PARTY CLAIMS | 34 | ||||
11.7
|
INSURANCE | 35 | ||||
ARTICLE 12
|
TERM AND TERMINATION | 36 | ||||
12.1
|
TERM | 36 | ||||
12.2
|
TERMINATION | 36 | ||||
12.3
|
EFFECT OF TERMINATION | 36 | ||||
ARTICLE 13
|
CONFIDENTIALITY | 37 | ||||
13.1
|
NON-DISCLOSURE AND NON-USE | 37 | ||||
13.2
|
AUTHORIZED DISCLOSURE | 37 | ||||
13.3
|
PUBLICITY | 37 | ||||
ARTICLE 14
|
LIMITATIONS ON REMEDIES | 38 | ||||
14.1
|
CONSEQUENTIAL DAMAGES | 38 | ||||
14.2
|
REMEDIES | 38 | ||||
ARTICLE 15
|
MISCELLANEOUS | 38 | ||||
15.1
|
ASSIGNMENT | 38 | ||||
15.2
|
NOTICES | 38 | ||||
15.3
|
WAIVER | 39 | ||||
15.4
|
SEVERABILITY | 39 | ||||
15.5
|
AMBIGUITIES; INTERPRETATION | 39 | ||||
15.6
|
GOVERNING LAW; JURISDICTION; ATTORNEYS’ FEES | 39 | ||||
15.7
|
HEADINGS | 40 | ||||
15.8
|
FACSIMILE EXECUTION; COUNTERPARTS | 40 | ||||
15.9
|
ENTIRE AGREEMENT; AMENDMENTS | 40 | ||||
15.10
|
INDEPENDENT CONTRACTORS | 40 | ||||
15.11
|
CURRENCY | 41 | ||||
15.12
|
BANKRUPTCY | 41 | ||||
15.13
|
FORCE MAJEURE | 41 |
45