1
EXHIBIT 10.37
JOINT VENTURE AGREEMENT
THIS JOINT VENTURE AGREEMENT (this "AGREEMENT") is entered into as of
December 11, 1998 by and between INTRACEL CORPORATION ("INTRACEL"), a Delaware
corporation having its principal office at 1330 Piccard Drive, Rockville, MD,
and LEHIGH VALLEY HOSPITAL AND HEALTH NETWORK ("LEHIGH"), a Pennsylvania
non-profit corporation having its principal office at Cedar Crest & X-00,
Xxxxxxxxx, XX.
WHEREAS, Intracel has (i) developed OncoVaxCL(R) ("ONCOVAX") to be
utilized in the treatment of colon cancer and (ii) the technical expertise
necessary for the manufacture, production and distribution of OncoVax and other
drugs as agreed to by the parties to be used in the treatment of cancer;
WHEREAS, Lehigh and its medical staff have the knowledge and expertise,
as well as the facilities reasonably necessary to support the diagnoses and
treatment of certain oncological diseases and the location necessary for the
production and delivery of OncoVax to certain patients in the mid-Atlantic
region;
WHEREAS, Intracel and Lehigh desire to form Intracel Cancer Center of
Pennsylvania, Inc. ("ICC") as a for-profit Delaware corporation to operate a
center for the manufacture of OncoVax and other oncological products as agreed
to by the parties, and to provide, or arrange for the provision of, such
products to cancer patients; and
WHEREAS, the parties wish to set forth herein and in the documents and
agreements attached hereto and/or referenced herein the terms on which ICC would
be formed, capitalized, governed, and operated, as well as the obligations and
rights of the parties prior to such formation.
NOW THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements hereinafter set forth, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto hereby agree as follows:
1. DEFINITIONS
The following terms used in this Agreement (including the Exhibits
hereto), and the singular and plural thereof, which are not otherwise defined
herein, shall have the meanings ascribed to them in this Section 1.
2
"AMENDED AND RESTATED INITIAL ONCOVAX CENTER LEASE" means the Amended
and Restated Initial OncoVax Center Lease, substantially in the form attached
hereto as Exhibit N, to be entered into by the parties on the date hereof.
"BEST EFFORTS" means, as to a party hereto, an undertaking by such party
to perform or satisfy an obligation or duty or otherwise act in a manner
reasonably calculated to obtain the intended result by action or expenditure not
disproportionate or unduly burdensome in the circumstances, which means, among
other things, that such party shall not be required to (i) expend funds other
than for payment of the reasonable and customary costs and expenses of
employees, counsel, consultants, representatives or agents of such party in
connection with the performance or satisfaction of such obligation or duty or
other action or (ii) institute litigation or arbitration as part of its best
efforts.
"BUSINESS PLAN" means the business plan to be developed by Intracel and
Lehigh as described in Section 5.1 below.
"CLEAN ROOM" means the laboratory room as described in Exhibit H leased
to Intracel or ICC, as the case may be, by Lehigh under the terms of either the
Amended and Restated Initial OncoVax Center Lease or the Final OncoVax Center
Lease.
"COMMON STOCK" means the common stock of ICC, par value $.01 per share.
"COMMON STOCK PURCHASE PRICE" means the amount to be paid in
consideration of the Common Stock pursuant to Section 3.2 below.
"EQUIPMENT" or "CLEAN ROOM EQUIPMENT" means the Equipment located in the
Clean Room as described in Exhibit J attached hereto.
"FINAL CLOSING" means the closing of the transactions described in
Section 16.1 below.
"FINAL CLOSING DATE" means the date mutually agreed upon in writing by
the parties pursuant to Section 16.1 below, which is within 30 days of the
receipt of FDA approval to market OncoVax to cancer patients at the OncoVax
Center.
"FINAL ONCOVAX CENTER LEASE" means the Final OncoVax Center Lease,
substantially in the form attached hereto as Exhibit G, to be entered into by
Lehigh and Intracel at the Final Closing pursuant to Section 5.3 below.
"ICC SERVICE AREA" shall mean the following counties in Pennsylvania:
Bradford, Susquehanna, Xxxxx, Lycoming, Xxxxxxxx, Wyoming, Lackawanna,
Northumberland, Montour, Columbia, Luzerne, Pike, Dauphin, Schuylkill, Carbon,
Monroe, York, Lebanon, Lancaster, Berks, Lehigh, Northampton, Chester,
Montgomery, Bucks and Delaware, and the following counties in New Jersey:
Sussex, Xxxxxx, Hunterdon, Somerset and Xxxxxx.
- 2 -
3
"INITIAL FUNDING SCHEDULE" means the operating budget for ICC to be
developed by Intracel and Lehigh as described in Section 3.3 below. The Initial
Funding Schedule shall set forth, among other things, ICC's projected working
capital needs for the initial operation of ICC following the Final Closing Date.
"INITIAL CLOSING" means the closing of the transactions described in
Section 15.1 below.
"INITIAL CLOSING DATE" means December 11, 1998 or such other date as
mutually agreed upon in writing by the parties to this Agreement pursuant to
Section 15.1 below.
"INTERIM PHASE" means the period of time commencing on the Initial
Closing Date and ending on the Final Closing Date during which time the OncoVax
Center shall be operated in accordance with Section 10 below.
"MEDICAL DIRECTOR" means the medical director of the OncoVax Center.
"ONCOVAX CENTER" means the location from which Intracel or ICC, as the
case may be, shall manufacture, market and provide, or arrange for the provision
of, OncoVax or any other oncological product agreed to by the parties to cancer
patients.
"INTRACEL CANCER CENTER OF PENNSYLVANIA, INC." or "ICC" means a Delaware
corporation, which shall be organized by Intracel and Lehigh as contemplated in
Section 2.1 below.
"OPERATIONS AGREEMENT" means the agreement to be entered into by and
between ICC, Intracel and Lehigh on the Final Closing Date, which will set forth
the obligations of ICC, Intracel and Lehigh during the Operational Phase as more
fully described in Section 9 below.
"OPERATIONAL PHASE" means the period of time from the Final Closing Date
until the termination of this Agreement during which time the OncoVax Center
shall be operated in accordance with Section 5 below.
"STOCKHOLDERS' AGREEMENT" means the Stockholders' Agreement
substantially in the form of Exhibit F attached hereto to be entered into by and
among ICC, Intracel and Lehigh as described in Section 4 below.
"SUPERMAJORITY VOTE" shall have the meaning set forth in the
Stockholders' Agreement.
- 3 -
4
2. FORMATION AND ORGANIZATION OF ICC
2.1. GENERALLY
Prior to and as a condition to the Final Closing, the parties
shall incorporate ICC as a for-profit corporation under the Delaware General
Corporation Law by filing a Certificate of Incorporation substantially in the
form of Exhibit A attached hereto. The parties shall thereafter, but prior to
the Final Closing, cause the adoption of the organizational resolutions and
bylaws of ICC substantially in the form of Exhibits B-1 and B-2 attached hereto.
2.2. INITIAL DIRECTORS
The members of the initial Board of Directors of ICC shall be
named in the Certificate of Incorporation referred to in Section 2.1 above and
shall consist of (a) 3 directors designated by Intracel and (b) 2 directors
designated by Lehigh. Each of the parties will provide a list of its designees
to the initial ICC Board of Directors as soon as reasonably practicable after
the date hereof and in no event later than 10 days prior to the Final Closing.
2.3. INITIAL OFFICERS
The parties will select, and cause to be elected, the officers
of ICC as soon as possible after the execution and delivery hereof and in any
event prior to the Final Closing.
3. CAPITALIZATION OF ICC
3.1. CONTRIBUTION OF EQUIPMENT AND PURCHASE OF ICC COMMON STOCK BY
INTRACEL
Subject to the terms and conditions hereof, and as set forth in
the Subscription Agreement substantially in the form attached hereto as Exhibit
C and in the Xxxx of Sale substantially in the form attached hereto as Exhibit D
("ICC XXXX OF Sale"), Intracel hereby agrees to contribute the Equipment to ICC
at the Final Closing as further described in Section 6.2 in exchange for 1,900
shares of Common Stock of ICC, which stock shall have an aggregate value equal
to $700,000.
- 4 -
5
3.2. SUBSCRIPTION FOR AND PURCHASE OF ICC COMMON STOCK BY LEHIGH
Subject to the terms and conditions hereof and as set forth in
the Subscription Agreement attached hereto as Exhibit E, Lehigh shall subscribe
for and shall agree to purchase, at the Final Closing, 100 shares of Common
Stock at an aggregate purchase price equal to $36,482 (the "COMMON STOCK
PURCHASE PRICE").
3.3. CAPITALIZATION OF ICC UPON FINAL CLOSING.
The parties acknowledge and agree that, in accordance with this
Section 3, upon the consummation of the Final Closing, Intracel and Lehigh will
own 95% and 5%, respectively, of the issued and outstanding capital stock of
ICC.
3.4. INITIAL FUNDING SCHEDULE
During the Interim Phase, the parties agree to negotiate in good
faith and use their best efforts to develop the Initial Funding Schedule. The
Initial Funding Schedule shall be mutually agreed upon prior to the Final
Closing and shall (i) set forth, among other things, ICC's projected capital
needs for its initial operation following the Final Closing and (ii) provide
that the parties will contribute funds to ICC in proportion to their relative
ownership interests in ICC.
4. STOCKHOLDERS AGREEMENT AND GOVERNANCE OF ICC
At the Final Closing, Intracel and Lehigh shall execute and
deliver, and cause ICC to execute, a Stockholders' Agreement substantially in
the form attached hereto as Exhibit F (the "STOCKHOLDERS' AGREEMENT"), which
shall contain, among other things, customary covenants, and representations and
warranties, and shall provide that all distributions of dividends by ICC to the
parties be made in proportion to their relative ownership interests in ICC.
Execution and delivery of the Stockholders' Agreement by all of the parties
thereto shall be a condition to the Final Closing.
5. BUSINESS AND OPERATIONS OF ICC
5.1. DEVELOPMENT OF THE BUSINESS PLAN
Intracel and Lehigh, working with ICC management, shall use
their best efforts to develop, as soon as practicable after the Final Closing,
the Business
- 5 -
6
Plan for ICC. During the Interim Phase, the parties agree to negotiate in good
faith the terms of the Business Plan, which shall be developed on or prior to
the Final Closing. The terms of such Business Plan shall include, among other
things, the establishment and administration of the Initial Funding Schedule. As
more specifically provided in the Stockholders' Agreement, the Business Plan and
any material amendments thereto must be approved by a supermajority vote of the
Board of Directors of ICC. After the Final Closing, Intracel and Lehigh shall
each use its best efforts to cause ICC to fully and faithfully implement the
Business Plan in compliance with the Initial Funding Schedule and in a timely
manner.
5.2. SCOPE OF OPERATIONS
From the Final Closing Date until termination of this Agreement,
in addition to the conduct of Phase III clinical trials ("TRIALS") and in
accordance with the terms of the Operations Agreement (as described in Section 9
below), ICC shall operate the OncoVax Center for the manufacture of OncoVax and
other oncological products as agreed to by the parties and shall provide, or
arrange for the provision of, such products to cancer patients to the extent
permitted by applicable law (the "OPERATIONAL PHASE"). Intracel and Lehigh agree
to cooperate in coordinating publicity with the respect to the operation of the
OncoVax Center during the Operational Phase.
5.3. LEASE OF THE ONCOVAX CENTER
At the Final Closing, Lehigh and ICC shall enter into a lease
substantially in form attached hereto as Exhibit G, which shall provide for the
lease by Lehigh to ICC of the Clean Room, and all clinical patient care,
administrative and storage space, as more particularly described in Exhibit H
attached hereto, reasonably necessary for the operation of the OncoVax Center
(the "FINAL ONCOVAX CENTER LEASE").
5.4. OPERATION OF THE ONCOVAX CENTER
5.4.1. OPERATIONAL POLICIES AND PROCEDURES
The Operations Agreement shall provide that ICC shall adopt and
enforce policies and procedures for the operation of the OncoVax Center during
the Operational Phase, which such policies and procedures shall be consistent
with, and require ICC and its employees and agents to comply with, Lehigh's
Facility Policies, Rules and Regulations. Intracel shall, in accordance with the
terms of the Operations Agreement, have the right to review, amend and approve
all of ICC's operational policies and procedures including those related to
compliance with FDA
- 6 -
7
requirements, and any amendments thereto before such
policies and procedures are implemented by ICC. Lehigh shall have the right to
review all such policies and procedures and any amendments thereto and Intracel
shall take any concerns into consideration prior to approving any such policies
and procedures. The Operations Agreement shall provide that ICC shall accept all
amendments submitted by Intracel to ICC in connection with those operational
policies and procedures related to compliance with FDA requirements. Intracel
shall maintain ultimate responsibility for compliance with all applicable FDA
product requirements.
5.4.2. ONCOVAX CENTER PERSONNEL
Except as set forth below, the terms of the Operations Agreement
shall provide that during the Operational Phase, all laboratory, clinical and
administrative personnel working in the OncoVax Center shall be employees of ICC
and subject to ICC's personnel policies and procedures which personnel policies
and procedures shall be adopted only after receipt of approval from both
Intracel and Lehigh, each in its reasonable discretion; provided, however, that
Intracel shall have the right to terminate such employees as further described
in Section 9.1 below. The Medical Director shall be an employee of Lehigh and
provide services to the OncoVax Center as further described in Section 5.4.3
below.
5.4.3. DESIGNATION OF MEDICAL DIRECTOR
Unless the parties otherwise agree, the Medical Director of the
OncoVax Center during the Interim Phase (as designated in accordance with
Section 10.5 below) shall continue as Medical Director of the OncoVax Center
after the Final Closing Date. The Medical Director shall remain an employee of
Lehigh and shall perform services for the OncoVax Center as an independent
contractor pursuant to the terms of a Medical Director Services Agreement,
substantially in the form of Exhibit I attached hereto and made a part hereof
(the "FINAL MEDICAL DIRECTOR SERVICES AGREEMENT"). The parties shall use their
best efforts to cause ICC to execute the Final Medical Director Services
Agreement on the Final Closing Date. The Final Medical Director Services
Agreement shall provide that ICC shall reimburse Lehigh for the Medical
Director's services at the fair market value for such services, which the
parties agree shall be at the rate described in Section 10.5. Lehigh shall at
all times have the right to recommend and approve the appointment of a Medical
Director for the OncoVax Center; provided, however, that Intracel shall have the
right to terminate the services provided by any particular Medical Director as
provided in Section 9.
5.5. LEHIGH AND INTRACEL CONTRACTS WITH ICC
As further developed in the Business Plan and as provided for in
the Operations Agreement, each of the parties intends to enter into a services
- 7 -
8
agreement with ICC pursuant to which such party will provide specified
management or administrative services to ICC as further described in Sections
5.5.1 and 5.5.2 below. Each such agreement, and any amendment thereto shall be:
(a) on arms length, fair market value terms and conditions;
and
(b) subject to the prior approval by the Board of Directors
of ICC.
The parties shall use their best efforts to negotiate, enter into and cause ICC
to enter into, such mutually acceptable agreements on the Final Closing Date.
5.5.1. SERVICES PROVIDED BY LEHIGH
At the Final Closing, and from time to time throughout the term
of this Agreement and the term of the Operations Agreement, ICC may purchase
certain services from Lehigh at a price to be agreed upon by Lehigh and ICC,
which services shall include, but shall not be limited to the following:
(a) Support services such as bioengineering and
housekeeping;
(b) Specialized laboratory testing;
(c) Sales and marketing support; and
(d) Assistance with and support for the development of
relationships with managed care entities and physician
groups.
5.5.2. SERVICES PROVIDED BY INTRACEL
At the Final Closing, and from time to time throughout the term
of this Agreement and the term of the Operations Agreement, ICC may purchase
certain
- 8 -
9
services from Intracel at a price to be agreed upon by Intracel and ICC, which
services shall include, but shall not be limited to the following:
(a) Case management services;
(b) Reimbursement services;
(c) Accounting and finance services;
(d) Quality assurance and assistance with FDA regulatory
monitoring and compliance;
(e) Sales and marketing services; and
(f) Kits and supplies necessary for the manufacture and
production of OncoVax.
6. PURCHASE AND CONTRIBUTION OF CLEAN ROOM EQUIPMENT
6.1. PURCHASE OF CLEAN ROOM EQUIPMENT AT FINAL CLOSING
Concurrent with the Final Closing, Lehigh shall sell, assign,
and transfer to Intracel, and Intracel shall purchase from Lehigh the equipment
located in the Clean Room and described in Exhibit J attached hereto (the
"EQUIPMENT") for an aggregate purchase price of $700,000 (the "PURCHASE PRICE"),
which the parties agree reflects the fair market value of the Equipment. Upon
the Final Closing, the parties agree that the Purchase Price shall be adjusted
to reflect the amount of the Purchase Price pre-paid by Intracel to Lehigh prior
to the Final Closing Date (the "ADJUSTED PURCHASE PRICE"). The Adjusted Purchase
Price shall be calculated as follows: $700,000 minus the aggregate Principal
Component (as defined in Schedule 6.1) of the aggregate rent paid by Intracel to
Lehigh pursuant to Section 7.1 of each of the Initial OncoVax Center Lease and
the Amended and Restated Initial OncoVax Center Lease. At the Final Closing,
Intracel shall pay $36,842 of the Adjusted Purchase Price by check or wire
transfer of readily available funds and the remainder of the Adjusted Purchase
Price shall be paid in the form of a convertible note substantially in the form
of Exhibit K (the "CONVERTIBLE NOTE"). The principal amount due under the
Convertible Note shall be payable in a balloon payment due on the fifth
anniversary thereof together with interest at a rate equal to the prime rate as
published in the Wall Street Journal. The Convertible Note shall be secured by a
Security Agreement substantially in the form of Exhibit L attached hereto,
pursuant to which Intracel shall grant a security interest in the Equipment to
Lehigh. The terms and conditions of the purchase of the Equipment are more
particularly set forth in the Xxxx of Sale attached hereto as Exhibit M (the
"LEHIGH BILL OF SALE").
6.2. CONTRIBUTION OF EQUIPMENT AT THE FINAL CLOSING
Concurrent with the purchase and sale of the Equipment, Intracel
agrees to contribute the Equipment to ICC. The parties shall use their best
efforts to cause ICC to accept such Equipment and to issue shares of Common
Stock of ICC to Intracel in exchange for such Equipment as more particularly
described in Section 3.1 and in the ICC Xxxx of Sale attached hereto as Exhibit
D. Intracel agrees to provide Lehigh with documentation evidencing the
contribution of Equipment to ICC at the Final Closing.
- 9 -
10
7. LICENSE OF RIGHTS TO ICC
During the Interim Phase, the parties agree to negotiate in good faith
the terms of the License Agreement (the "LICENSE AGREEMENT") to be entered into
by Intracel and ICC at the Final Closing, pursuant to which Intracel shall grant
to ICC a limited, exclusive right in the ICC Service Area to manufacture,
produce and distribute or arrange for the distribution of, OncoVax and such
other products as the parties may mutually agree on.
8. LIMITATIONS ON ACTIVITIES OF LEHIGH
Lehigh agrees that during the term of this Agreement and for a period of
one year thereafter, it shall not directly or indirectly on its own or through
any joint venture, teaming arrangement, partnership, or other entity or
arrangement, engage in the manufacture, production or distribution of any cancer
related products comparable to any products manufactured, produced or
distributed by Intracel or ICC at any time during the Term of this Agreement.
9. OPERATIONS AGREEMENT
During the Interim Phase, Intracel and Lehigh agree to negotiate
in good faith the terms of an Operations Agreement to be entered into at the
Final Closing by ICC, Intracel and Lehigh (the "OPERATIONS AGREEMENT"). The
Operations Agreement shall set forth all the rights and obligations of ICC,
Intracel and Lehigh during the Operational Phase, including, but not limited to,
those rights and obligations described in Sections 5 and 7 above and the
additional operational rights of Intracel and Lehigh described below. In the
event of an inconsistency between the terms and conditions of this Agreement
relating to the rights and obligations of ICC, Intracel and Lehigh with respect
to those contained in the Operations Agreement, the Operations Agreement's terms
and conditions shall govern. The parties hereto shall each use its best efforts
to cause ICC to execute the Operations Agreement on the Final Closing Date.
9.1. INTRACEL'S OPERATIONAL RIGHTS
Notwithstanding anything to the contrary in this Agreement, the
parties agree that Intracel shall have, among others, the following rights: (i)
the right to audit ICC and the OncoVax Center, (ii) the right to close the
OncoVax Center or otherwise stop ICC from manufacturing OncoVax or any other
drug agreed to by the parties if the OncoVax Center or ICC's manufacturing of
OncoVax or any other drug is not in compliance with applicable laws and
regulations, (iii) the right to terminate any of ICC's employees or terminate
the services of any particular Medical Director if such employee or Medical
Director fails to comply
- 10 -
11
with applicable laws and regulations, (iv) the right to represent ICC and the
OncoVax Center in any interaction with the FDA, (v) the right to require
implementation of any actions or changes in order to assure full compliance with
all applicable FDA requirements, and (vi) the right to take all such other
actions with respect to ICC, its operations and its employees in order to comply
with all applicable laws and regulations.
9.2. LEHIGH'S OPERATIONAL RIGHTS
Notwithstanding anything to the contrary herein, the parties
agree that Lehigh shall have the right to (i) audit ICC and the OncoVax Center,
and (ii) review on a regular basis all of ICC's and the OncoVax Center's
operational policies and procedures.
10. INTERIM PHASE OPERATIONS
10.1. INITIAL ONCOVAX CENTER LEASE
On October 21, 1998 and prior to the Initial Closing, the
parties entered in a lease (the "INITIAL ONCOVAX CENTER LEASE") and a letter
agreement relating thereto (the "LETTER AGREEMENT") for the operation of the
OncoVax Center for the period from November 1, 1998 until the Initial Closing.
At the Initial Closing, Lehigh and Intracel shall terminate the Letter Agreement
and enter into an Amended and Restated Initial OncoVax Center Lease,
substantially in the form attached hereto as Exhibit N (the "AMENDED AND
RESTATED INITIAL ONCOVAX CENTER LEASE"), which Amended and Restated Initial
OncoVax Center Lease shall provide for the lease of the Clean Room, Clean Room
Equipment, and clinical patient care, administrative and storage space
(collectively, the "FACILITIES"), each as more particularly described in
Exhibits H and J attached hereto. In the event of the termination of this
Agreement during the Interim Phase for any reason, the Amended and Restated
Initial OncoVax Center Lease shall terminate in accordance with its own terms,
effective as of the date of the termination of this Agreement.
10.2. SCOPE OF OPERATIONS DURING INTERIM PHASE
During the Interim Phase, Intracel shall utilize the Facilities
for the purpose of manufacturing and producing OncoVax for use in the conduct of
the Trials and arranging for and/or sponsoring such Trials at the OncoVax Center
and furnishing OncoVax to patients as permitted under federal law and Food and
Drug Administration ("FDA") guidance. Intracel and Lehigh agree to cooperate in
coordinating publicity with the respect to the opening of the OncoVax Center for
the
- 11 -
12
conduct of such Trials. Lehigh agrees that it shall not publicize, advertise
or otherwise use the name of the OncoVax Center or Intracel without the prior
written consent of Intracel, which consent shall not be unreasonably withheld.
10.3. OPERATIONAL POLICIES AND PROCEDURES
Intracel shall adopt and enforce policies and procedures for the
operation of the OncoVax Center during the Interim Phase and shall require that
all Trials be conducted in accordance with (a) all applicable laws and
regulations and (b) Lehigh's Facility Policies, Rules and Regulations.
10.4. SERVICES PROVIDED BY LEHIGH
During the Interim Phase, Intracel shall purchase certain
services from Lehigh at a price to be agreed upon by Lehigh and ICC, which
services shall include the following:
(a) Support services such as bioengineering and
housekeeping;
(b) Specialized laboratory testing; and
(c) Assistance with and support for the development of
relationships with managed care entities and physician
groups.
Such services will be provided pursuant to an agreement
negotiated at arms length and providing for fair market value terms and
conditions.
10.5. ONCOVAX CENTER PERSONNEL
Except as described below, during the Interim Phase all
laboratory, clinical and administrative personnel engaged in the manufacture and
production of OncoVax and the conduct of the Trials, shall be employees of
Intracel and subject to Intracel's personnel policies and procedures. The
medical director of the OncoVax Center during the Interim Phase shall be Xxxxxxx
X. Xxxxxx, Xx., M.D. or his designee (the "MEDICAL DIRECTOR"). The Medical
Director shall be an employee of Lehigh and shall render services during the
Interim Phase as an independent contractor pursuant to the terms and conditions
of an initial Medical Director Services Agreement, substantially in the form of
Exhibit O attached hereto and made a part hereof (the "INITIAL MEDICAL DIRECTOR
SERVICES AGREEMENT"). The parties agree that the fair market value of the
services provided by the Medical Director for the OncoVax Center during the
first year shall be $75,000, which compensation pursuant to the terms of the
Initial Medical Director Services Agreement shall be adjusted annually by
Intracel during the Interim Phase to reflect the fair market value of the
Medical Director's services. In the event of the
- 12 -
13
termination of this Agreement during the Interim Phase for any reason, the
Initial Medical Director Services Agreement shall automatically terminate in
accordance with its own terms, effective as of the date of termination of this
Agreement.
10.6. ADDITIONAL EQUIPMENT; IMPROVEMENTS TO THE CLEAN ROOM
During the Interim Phase, Intracel may purchase additional
equipment for the Clean Room and make improvements to the Clean Room, which
additional equipment and improvements shall be transferred to ICC by Intracel,
as soon as practicable after the Final Closing on a date agreed to by the
parties. The parties agree that any amounts paid by Intracel to purchase such
additional equipment and improvements shall be off-set against any capital
contributions Intracel is required to make pursuant to the Initial Funding
Schedule.
11. REGULATORY APPROVALS
After the Initial Closing and prior to the Final Closing,
Intracel shall use its best efforts to obtain any authorizations, consent, and
approvals of any federal, state, local, foreign or other governmental agency,
instrumentality, commission, authority, board or body or other person or entity,
including the FDA, for the transactions contemplated hereunder. Such approvals
and authorizations shall include, without limitation, the FDA's approval and
authorization to market and provide OncoVax, manufactured at the OncoVax Center,
to cancer patients. Lehigh agrees to use its best efforts to cooperate with, and
provide support to, Intracel in complying with current Good Manufacturing
Practices ("CGMPS") and to maintain any state licenses necessary to furnish care
to cancer patients at the OncoVax Center.
12. REPRESENTATIONS AND WARRANTIES
Concurrent with the execution and delivery of this Agreement,
Intracel and Lehigh have each executed and delivered the Certificates attached
hereto as Exhibits P-1 and P-2 containing certain representations and warranties
of the parties.
13. CONDITIONS PRECEDENT TO INITIAL CLOSING
The obligations of each party to consummate the transactions
contemplated in this Agreement and to proceed with the Initial Closing are
subject to the fulfillment at or prior to the Initial Closing, of each of the
following conditions
- 13 -
14
(the failure of any of which shall excuse and discharge all obligations of such
party hereunder, unless such failure is agreed to in writing by such party):
(a) the execution and delivery by the parties of the Amended and
Restated Initial OncoVax Center Lease as set forth in Section 10.1 above;
(b) the Letter Agreement shall be terminated;
(c) the execution and delivery by the parties of the Initial
Medical Director Services Agreement; and
(d) the representations and warranties of Intracel and Lehigh
contained in this Agreement shall be true and correct in all material respects
as of the Initial Closing Date as if made at and as of such time, and Intracel
and Lehigh shall have performed or complied with, in all material respects all
agreements and covenants required by this Agreement to be performed or complied
with by it prior to or at and as of the Initial Closing Date.
14. CONDITIONS PRECEDENT TO THE FINAL CLOSING
14.1. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF EACH PARTY
The obligations of each party to consummate the transactions
contemplated in this Agreement and to proceed with the Final Closing are subject
to the fulfillment at or prior to the Final Closing, of each of the following
conditions (the failure of any of which shall excuse and discharge all
obligations of such party hereunder, unless such failure is agreed to in writing
by such party):
(a) Intracel's and Lehigh's designation of the initial ICC board
of directors pursuant to Section 2.2;
(b) the incorporation and organization of ICC as evidenced by
the filing of the Articles of Incorporation of ICC with and issuance of a
Certificate of Incorporation by, the Delaware Secretary of State;
(c) the adoption of the Bylaws of ICC;
(d) the development of the Initial Funding Schedule pursuant to
Section 3.3;
(e) the development of the Business Plan pursuant to Section 5.1
above; and
- 14 -
15
(f) FDA approval of OncoVax for use in the treatment of cancer.
14.2. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF INTRACEL
The obligations of Intracel as contemplated in this Agreement
and to proceed with the Final Closing are subject to the fulfillment, at or
prior to the Final Closing, of each of the following conditions (the failure of
any of which shall excuse and discharge all obligations of Intracel hereunder,
unless such failure is excused in writing by Intracel):
(a) the execution of the Lehigh Bill of Sale by Lehigh and the
delivery of the Equipment as set forth in Section 6.1 above;
(b) the execution and delivery of the Stockholders' Agreement by
Lehigh and ICC;
(c) the delivery of the Common Stock Purchase Price by Lehigh
and the delivery of a duly executed Subscription Agreement as set forth in
Section 3.2 above;
(d) the execution and delivery of the Final OncoVax Center Lease
as set forth in Section 5.3 above;
(e) the execution and delivery of the Final Medical Director
Services Agreement as set forth in Section 5.4.3 above;
- 15 -
16
(f) the execution and delivery of the License Agreement as set
forth in Section 7 above;
(g) the execution and delivery of the Operations Agreement as
set forth in Section 9 above;
(h) the representations and warranties of Lehigh contained in
this Agreement shall be true and correct in all material respects as of the
Final Closing Date as if made at and as of such time, and Lehigh shall have
performed or complied with, in all material respects all agreements and
covenants required by this Agreement to be performed or complied with by it
prior to or at and as of the Final Closing Date; and
(i) the transaction has been approved by the board of directors
of Lehigh or the executive committee of such board, if any.
14.3. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF LEHIGH
The obligations of Lehigh to consummate the transactions
contemplated in this Agreement and to proceed with the Final Closing are subject
to the fulfillment, at or prior to the Final Closing, of each of the following
conditions (the failure of any of which shall excuse and discharge all
obligations of Lehigh hereunder, unless such failure is excused in writing by
Lehigh):
(a) the execution and delivery of the Stockholders' Agreement by
Intracel and ICC;
(b) Intracel's delivery of the Equipment to ICC pursuant to the
ICC Xxxx of Sale and the delivery of a duly executed Subscription Agreement as
set forth in Sections 3.1 and 6.2 above;
(c) the execution and delivery of the Final OncoVax Center Lease
as set forth in Section 5.3 above;
(d) the execution and delivery of the Final Medical Director
Services Agreement as set forth in Section 5.4.3 above;
(e) the execution and delivery of the Convertible Note and the
Security Agreement as set forth in Section 6.1 above;
(f) the execution and delivery of the License Agreement as set
forth in Section 7 above;
- 16 -
17
(g) the execution and delivery of the Operations Agreement as
set forth in Section 9 above;
(h) the representations and warranties of Intracel contained in
this Agreement shall be true and correct in all material respects as of the
Final Closing Date as if made at and as of such time, and Intracel shall have
performed or complied with, in all material respects all agreements and
covenants required by this Agreement to be performed or complied with by it
prior to or at and as of the Final Closing Date; and
(i) the transaction has been approved by the board of directors
of Intracel or the executive committee of such board.
15. THE INITIAL CLOSING
15.1. GENERALLY
The Initial Closing shall take place at the offices of Lehigh
Valley Hospital and Health Network or at such other place to which the parties
may agree, on December 11, 1998, or such other time as the parties may agree
(the "INITIAL CLOSING DATE"). At the Initial Closing, and as a condition
precedent to the Initial Closing, the parties shall comply with such conditions
and shall deliver such documents as are set forth in Sections 15.2 and 15.3.
15.2. DELIVERIES BY INTRACEL
At the Initial Closing, in addition to any other documents or
agreements required under any other provision of this Agreement, Intracel shall
make the following deliveries and performance (and the obligation of Lehigh to
consummate the Initial Closing shall be conditioned thereon):
(a) this Agreement duly executed by Intracel;
(b) a certificate of good standing for Intracel from the
State of Delaware;
(c) a copy, certified by the Secretary of State of the State
of Delaware, of the Certificate of Incorporation of
Intracel, as amended;
- 17 -
18
(d) a copy of the Bylaws of Intracel, as amended, as
certified by the appropriate officers of Intracel as
being true, complete and in full force and effect;
(e) a certificate signed by the appropriate officers of
Intracel certifying resolutions authorizing the
execution of this Agreement and the transactions
hereunder;
(f) the Amended and Restated Initial OncoVax Center Lease
duly executed by Intracel;
(g) the Agreement terminating the Letter Agreement duly
executed by Intracel as required by Section 10.1 (the
"TERMINATION AGREEMENT");
(h) the Initial Medical Director Services Agreement duly
executed by Intracel;
(i) evidence that Intracel has obtained and maintains
insurance as required by Section 18.7.1 below; and
(j) any additional documents that Lehigh may reasonably
require for the proper consummation of the transactions
contemplated by this Agreement.
15.3. DELIVERIES BY LEHIGH
At the Initial Closing, in addition to any other documents or
agreements required under any other provision of this Agreement, Lehigh shall
make the following deliveries and performance (and the obligation of Intracel to
consummate the Initial Closing shall be conditioned thereon):
(a) this Agreement duly executed by Lehigh;
(b) a certificate of good standing for Lehigh from the
Commonwealth of Pennsylvania;
(c) a copy, certified by the Secretary of State of the
Commonwealth of Pennsylvania, of the Articles of
Incorporation of Lehigh, as amended;
- 18 -
19
(d) a copy of the Bylaws of Lehigh, as amended, as certified
by the appropriate officers of Lehigh as being true,
complete and in full force and effect;
(e) a certificate signed by the appropriate officers of
Lehigh certifying resolutions authorizing the execution
of this Agreement and the transactions hereunder;
(f) the Amended and Restated Initial OncoVax Center Lease
duly executed by Lehigh;
(g) the Termination Agreement duly executed by Lehigh;
(h) the Initial Medical Director Services Agreement duly
executed by Lehigh;
(i) evidence that Lehigh has obtained and maintains
insurance as required by Section 18.7.2 below; and
(j) any additional documents that Intracel may reasonably
require for the proper consummation of the transactions
contemplated by this Agreement.
16. THE FINAL CLOSING
16.1. GENERALLY
The Final Closing shall take place on a date, mutually agreed
upon by the parties, within 30 days after the receipt of FDA approval to market
OncoVax to cancer patients at the OncoVax Center (the "FINAL CLOSING DATE"), at
Lehigh's facility located at Cedar Crest & X-00, Xxxxxxxxx, XX or at such other
place to which the parties may agree. At the Final Closing, and as a condition
precedent to the Final Closing, the parties shall comply with such conditions
and shall deliver such documents as are set forth in Sections 16.2, 16.3 and
16.4.
16.2. DELIVERIES BY INTRACEL
At the Final Closing, in addition to any other documents or
agreements required under any other provision of this Agreement, Intracel shall
make the following deliveries and performance (and the obligation of Lehigh to
consummate the Final Closing shall be conditioned thereon):
(a) List of Intracel's designees to the initial ICC Board of
Directors;
(b) the Stockholders' Agreement duly executed by Intracel;
(c) the Convertible Note executed by Intracel;
(d) the Security Agreement duly executed by Intracel;
(e) the ICC Xxxx of Sale duly executed by Intracel, and
delivery of the ICC Xxxx of Sale and Equipment to ICC,
and documentation evidencing the delivery of the
Equipment to Lehigh;
(f) the License Agreement duly executed by Intracel pursuant
to Section 7;
(g) the Operations Agreement duly executed by Intracel
pursuant to Section 9; and
- 19 -
20
(h) any additional documents that Lehigh may reasonably
require for the proper consummation of the transactions
contemplated by this Agreement.
16.3. DELIVERIES BY LEHIGH
At the Final Closing, in addition to any other documents or
agreements required under any other provision of this Agreement, Lehigh shall
make the following deliveries and performance (and the obligation of Intracel to
consummate the Final Closing shall be conditioned thereon):
(a) List of Lehigh's designees to the initial ICC Board of
Directors;
(b) the Stockholders' Agreement duly executed by Lehigh;
(c) the Common Stock Purchase Price;
(d) the Final OncoVax Center Lease duly executed by Lehigh
pursuant to Section 5.3;
(e) the Final Medical Director Services Agreement duly
executed by Lehigh pursuant to Section 5.4.3;
(f) the Lehigh Bill of Sale duly executed by Lehigh pursuant
to Section 6.1 and delivery of the Equipment to
Intracel;
(g) the Operations Agreement duly executed by Lehigh
pursuant to Section 9;
(h) an Opinion of Bond Counsel to Lehigh in a form
satisfactory to Intracel; and
(i) any additional documents that Intracel may reasonably
require for the proper consummation of the transactions
contemplated by this Agreement.
16.4. DELIVERIES BY ICC
At the Final Closing, the parties shall use their best efforts
to cause ICC to:
(a) deliver to Lehigh, against delivery of the Common Stock
Purchase Price, a duly issued stock certificate made out
in Lehigh's name and representing the shares of Common
Stock to be purchased by Lehigh pursuant to Section 3.2
above;
(b) deliver to Intracel, against delivery of the Equipment,
a duly issued stock certificate made out in Intracel's
name and representing the shares of Common Stock to be
purchased by Intracel pursuant to Section 3.1 above;
(c) deliver the Stockholders' Agreement duly executed by
ICC;
(d) deliver the Final OncoVax Center lease duly executed by
ICC pursuant to Section 5.3;
(e) deliver the Final Medical Director Services Agreement
duly executed by ICC pursuant to Section 5.4.3;
(f) deliver the License Agreement duly executed by ICC
pursuant to Section 7; and
(g) deliver the Operations Agreement duly executed by ICC
pursuant to Section 9.
- 20 -
21
17. TERMINATION
17.1. TERMINATION
17.1.1. TERMINATION PRIOR TO FINAL CLOSING
This Agreement may be terminated at any time prior to Final
Closing as follows:
(a) immediately upon the mutual written agreement of Intracel
and Lehigh;
(b) immediately by Intracel, after written notice to Lehigh and
the expiration of any applicable cure period, upon a material breach of any
representation, warranty, covenant or agreement on the part of Lehigh set forth
in this Agreement, or if any representation or warranty of Lehigh has become
materially untrue, in either case such that Lehigh is unable to cure such
material breach so that the conditions set forth in Section 14 are incapable of
being satisfied by the Final Closing Date; provided, however, that in any case,
a willful breach will
- 21 -
22
be deemed to cause such conditions to be incapable of being satisfied for
purposes of this paragraph (b);
(c) immediately by Lehigh after written notice to Intracel and
the expiration of any applicable cure period, upon a material breach of any
representation, warranty, covenant or agreement on the part of Intracel set
forth in this Agreement, or if any representation or warranty of Intracel has
become materially untrue, in either case such that Intracel is unable to cure
such material breach so that the conditions set forth in Section 14 are
incapable of being satisfied by the Final Closing Date; provided, however, that
in any case, a willful breach will be deemed to cause such conditions to be
incapable of being satisfied for purposes of this paragraph (c); or
(d) immediately upon written notice by either party to the other
party if, through no fault of either party, the Final Closing shall not have
taken place by December 31, 2000, or such other date agreed to by the parties.
17.1.2. TERMINATION AFTER TO FINAL CLOSING
This Agreement may be terminated at any time after the Final
Closing as follows:
(a) immediately by either party after written notice to the
other party and the expiration of any applicable cure period in the event that
the other party has materially breached a representation, warranty, covenant or
agreement contained in this Agreement or in any other agreement or document
contemplated hereunder and such breach has not been cured within 30 days of
written notice thereof by the non-breaching party; or
(b) immediately upon written notice by either party to the other
party if FDA approval to market OncoVax is permanently withdrawn.
17.2. EFFECT OF TERMINATION
17.2.1. PRIOR TO FINAL CLOSING
In the event this Agreement is terminated prior to Final Closing
as provided above, (a) each of Lehigh and Intracel shall deliver to the other
party all documents previously delivered (and copies thereof in its possession)
concerning one another and the transactions contemplated hereby, (b) the Amended
and Restated Initial OncoVax Center Lease and the Initial Medical Director
Services Agreement shall terminate effective the date of termination of this
Agreement and the parties shall take any further action required to be taken
pursuant to the terms of
- 22 -
23
the Amended and Restated Initial OncoVax Center Lease and the Initial Medical
Director Services Agreement, and (c) neither of the parties nor any of their
respective stockholders, directors, officers or agents shall have any liability
to the other party, except for any deliberate breach or deliberate omission
resulting in breach of any of the provisions of this Agreement. In such case,
the breaching party shall be liable only for the expenses and costs of the
non-breaching party, and in no event shall either party be liable for
anticipated profits or consequential damages.
17.2.2. AFTER FINAL CLOSING
In the event this Agreement is terminated after Final Closing as
provided above, (a) each of Lehigh and Intracel shall deliver to the other party
all documents previously delivered (and copies thereof in its possession)
concerning one another and the transactions contemplated hereby, (b) the parties
shall take such steps as are reasonably necessary to cause the dissolution of
ICC in a timely fashion and in accordance with applicable law, (c) the parties
shall take such steps as are reasonably necessary to wind down the affairs of
ICC in accordance with applicable law and to terminate all of the agreements and
arrangements entered into by the parties as contemplated hereunder, (d) the
Final OncoVax Center Lease and the Final Medical Director Services Agreement
shall terminate effective the date of such termination of this Agreement and the
parties shall take any further action required to be taken pursuant to the terms
of the Final OncoVax Center Lease and the Final Medical Director Services
Agreement, (e) the parties shall cause ICC to sell, and ICC shall be obligated
to sell, the Clean Room Equipment to Lehigh, who shall be required to purchase
the Clean Room Equipment at its depreciated book value as of the date of
termination, and (f) neither of the parties nor any of their respective
stockholders, directors, officers or agents shall have any liability to the
other party, except for any deliberate breach or deliberate omission resulting
in breach of any of the provisions of this Agreement. In such case, the
breaching party shall be liable only for the expenses and costs of the
non-breaching party, and in no event shall either party be liable for
anticipated profits or consequential damages.
17.2.3. GENERALLY
After termination, each party shall keep confidential all
information provided by the other pursuant to this Agreement which is not in the
public domain, shall exercise the same degree of care in handling such
information as it would exercise with similar confidential information of its
own, and shall return any such information upon the other party's request.
- 23 -
24
18. INDEMNIFICATION; LIMITATION ON LIABILITY; INSURANCE; SURVIVAL
18.1. LEHIGH INDEMNIFICATION OF INTRACEL
Subject to Section 18.6.2 below, Lehigh will indemnify, defend
and hold harmless Intracel and Intracel's successors and assigns from and
against any and all actual and direct claims, damages, losses and liabilities
(including reasonable attorneys' fees) ("LOSSES") which may at any time be
asserted against or suffered by Intracel as a result of or on account of
Lehigh's negligence or any breach of any representation, warranty or covenant on
the part of Lehigh made herein or in any instrument or document delivered by
Lehigh pursuant hereto. Furthermore, Lehigh will indemnify Intracel and
Intracel's successors and assigns from any Losses arising out of any action
relating to or arising out of any action taken by Lehigh, or its employees as
agents, in connection with the Trials to be conducted at the Facilities during
the Interim Phase.
18.2. INTRACEL INDEMNIFICATION OF LEHIGH
Subject to Section 18.6.1 below, Intracel will indemnify, defend
and hold harmless Lehigh and Lehigh's successors and assigns from and against
any and all Losses which may at any time be asserted against or suffered by
Lehigh as a result of or on account of Intracel's negligence or any breach of
any representation, warranty or covenant on the part of Intracel made herein or
in any instrument or document delivered by Intracel pursuant hereto.
Furthermore, Intracel will indemnify Lehigh and Lehigh's successors and assigns
from any Losses arising out of any action relating to or arising out of any
action taken by Intracel, or its employees as agents, in connection with the
Trials to be conducted at the Facilities during the Interim Phase.
18.3. NOTICE
A party (an "INDEMNIFIED PARTY") shall give prompt written
notice to an indemnifying party (the "INDEMNIFYING PARTY") of any payments,
demands, claims, suits, judgments, liabilities, losses, costs, damages or
expenses (a "CLAIM") in respect of which such Indemnifying Party has a duty to
provide indemnity to such Indemnified Party under this Section 18, except that
any delay or failure to notify the Indemnifying Party only shall relieve the
Indemnifying Party of its obligations hereunder to the extent, if at all, that
it is prejudiced by reason of such delay or failure.
- 24 -
25
18.4. THIRD PARTY ACTIONS
In the event any claim is made, suit is brought, or other
proceeding instituted against a party to this Agreement which involves or
appears reasonably likely to involve a Loss, the Indemnified Party will, within
10 days after receipt of notice of any such claim, suit, or proceeding for which
indemnification may be sought, notify the Indemnifying Party in writing of the
commencement thereof; provided, however, that failure to give such notification
shall not affect the indemnification provided hereunder except to the extent the
Indemnifying Party can demonstrate actual monetary prejudice as a direct or
indirect result of such failure.
The Indemnified Party may elect, within 30 days after the
Indemnifying Party's receipt of such notice, or five days before the return date
required by any citation, claim, or other statute, whichever occurs earlier, to
contest or defend against such claim at the Indemnifying Party's expense, and
shall give written notice to the Indemnifying Party of the commencement of such
defense. The Indemnifying Party, its subsidiaries, successors, and assigns shall
be entitled to participate with the Indemnified Party in such event (at the
Indemnifying Party's cost and expense). In the event that the Indemnified Party
does not elect to contest, defend, settle, or pay the claim as provided above,
the Indemnifying Party, its subsidiaries, successors, or assigns shall have the
exclusive right to prosecute, defend, compromise, settle, or pay the claim in
its sole discretion and pursue its rights under this Agreement but shall not be
entitled in any way to release, waive, settle, modify, or pay such claim without
the consent of the Indemnified Party. Each party, its subsidiaries, successors,
and assigns shall cooperate in the defense of such action and the records of
each shall be available to the other with respect to such defense.
18.5. OTHER RECOVERIES
The amount of any Losses recoverable by an Indemnified Party
hereunder shall be reduced by the amount, if any, of the recovery (net of
reasonable expenses incurred in obtaining said recovery) the Indemnified Party
hereunder shall have received with respect thereto from any other party, person,
or entity, other than an insurer of the Indemnified Party unless such insurer
has expressly waived all rights of subrogation with respect to such recovery. In
the event such a recovery is made by an Indemnified Party after it receives
payment or other credit hereunder with respect to any Losses, then a refund
equal in aggregate amount to the recovery, net of reasonable expenses incurred
in obtaining that recovery, shall be made promptly to the Indemnifying Party
making such payment. Without limiting the foregoing, in the event that a claim
or benefit is created in connection with the occurrence of any Losses which have
not been collected by the Indemnified Party at the time payment with respect to
such Losses is made by the Indemnifying
- 25 -
26
Party, the Indemnified Party shall assign such benefit or claim to the
Indemnifying Party as a condition to the payment by the Indemnifying Party and
shall cooperate with the Indemnifying Party in its efforts to collect any such
benefit or claim. If such claim or benefit is not assignable under applicable
laws, the Indemnified Party shall cooperate in good faith with the Indemnifying
Party's efforts to collect such claim or benefit.
18.6. LIMITATION OF LIABILITY
18.6.1. LIMITATION OF INTRACEL'S LIABILITY.
Notwithstanding any other provision contained in this
Agreement, Intracel's liability under this Agreement shall be limited to actual
and direct losses suffered by Lehigh arising as a result of Intracel's negligent
failure to perform its obligations under this Agreement. Lehigh acknowledges and
agrees that Intracel shall not be liable for any lost reimbursement or loss of
data, earnings, profits or goodwill or any other indirect, consequential,
incidental, exemplary or punitive damages suffered by any person or entity,
including Lehigh, caused directly or indirectly by the acts or omissions of
Intracel, its employees or agents in the course of performing services or
functions contemplated under or related in any way to this Agreement (including,
without limitation, any breach by Intracel of its obligations under this
Agreement). Notwithstanding any other provision contained in this Agreement,
Intracel's maximum aggregate liability to Lehigh for any and all causes
whatsoever, and Lehigh's remedy, regardless of the form of action, whether in
contract or tort, including negligence, and whether or not pursuant to the
indemnification provisions contained in Section 18.2 and whether or not Intracel
is notified of the possibility of damage to Lehigh, shall be limited to
$3,000,000.
18.6.2. LIMITATION OF LEHIGH'S LIABILITY.
Notwithstanding any other provision contained in this
Agreement, Lehigh's liability under this Agreement shall be limited to actual
and direct losses suffered by Intracel arising as a result of Lehigh's negligent
failure to perform its obligations under this Agreement. Intracel acknowledges
and agrees that Lehigh shall not be liable for any lost reimbursement or loss of
data, earnings, profits or goodwill or any other indirect, consequential,
incidental, exemplary or punitive damages suffered by any person or entity,
including Intracel, caused directly or indirectly by the acts or omissions of
Lehigh, its employees or agents in the course of performing obligations or
functions contemplated under or related in any way to this Agreement (including,
without limitation, any breach by Lehigh of its obligations under this
Agreement). Notwithstanding any other provision contained in this Agreement,
Lehigh's maximum aggregate liability to Intracel for any and all causes
whatsoever, and Intracel's remedy, regardless of the form of
- 26 -
27
action, whether in contract or tort, including negligence, and whether or not
pursuant to the indemnification provisions contained in Section 18.1, and
whether or not Lehigh is notified of the possibility of damage to Intracel,
shall be to $3,000,000.
18.7. INSURANCE
18.7.1. INTRACEL'S OBLIGATION TO INSURE.
Intracel shall obtain and maintain in effect at all
times during the term of this Agreement insurance as set forth in Schedule
18.7.1. Such insurance policies shall name Lehigh as an additional insured and
Intracel shall provide such evidence as Lehigh may reasonably request from time
to time that Intracel has obtained and continues to maintain in full force and
effect insurance coverage as described in the preceding sentence. If such
insurance is purchased on a claims made basis, upon the termination of this
Agreement for any reason Intracel shall purchase an extended reporting
endorsement in amounts equivalent to the liability coverage maintained on the
date of termination to cover prior acts.
18.7.2. LEHIGH'S OBLIGATION TO INSURE.
Lehigh shall obtain and maintain in effect at all times
during the term of this Agreement insurance as set forth in Schedule 18.7.2.
Such insurance policies shall name Intracel as an additional insured and
Lehigh shall provide such evidence as Intracel may reasonably request from time
to time that Lehigh has obtained and continues to maintain in full force and
effect insurance coverage as described in the preceding sentence. If such
insurance is purchased on a claims made basis, upon the termination of this
Agreement for any reason Lehigh shall purchase an extended reporting endorsement
in amounts equivalent to the liability coverage maintained on the date of
termination to cover prior acts.
18.8. SURVIVAL
All representations, warranties, covenants, indemnities and
other agreements made by any party to this Agreement (including all Exhibits
hereto) or in any document, statement, certificate, or other instrument referred
to herein or delivered at the Initial Closing or the Final Closing in connection
with the transactions contemplated hereby shall survive any investigation made
by or on behalf of any of the parties and shall survive the execution and
delivery of this Agreement, the Initial Closing and the Final Closing, and the
consummation of the transactions contemplated hereby and shall remain in full
force and effect for a period of three years after the Final Closing Date,
except for claims, if any, asserted in writing prior to such third anniversary,
which claims shall survive until finally resolved and satisfied in full.
- 27 -
28
19. MISCELLANEOUS
19.1. CONFIDENTIAL AND PROPRIETARY INFORMATION
All non-public information received by Lehigh from Intracel or
by Intracel from Lehigh in connection with the transactions contemplated hereby
will be treated by the recipient as proprietary and will be made available only
to those within its organization who have a "need to know" in connection with
the matters contemplated hereby, to such recipient's attorneys, accountants and
other advisors, and as may be required by applicable law or regulations or may
be requested by any regulatory authority to which Lehigh or Intracel is subject;
provided, however, the foregoing restrictions with respect to information
furnished to one party by the other shall not apply to any such information
which the receiving party demonstrates (i) is on the date hereof, or hereafter
becomes, generally available to the public other than as a result of a
disclosure, directly or indirectly, by the receiving party or (ii) was available
or becomes available to the receiving party on a confidential or
non-confidential basis from a source other than the other party hereto, which
source was not itself bound by a confidentiality agreement with such other party
and did not receive such information, directly or indirectly, from a person or
entity so bound.
19.2. FURTHER ASSURANCES
The parties hereby agree to take whatever further actions or to
execute and deliver whatever further documents or instruments or make whatever
further filings as may be reasonably necessary or desirable to effectuate the
express provisions or the intent of this Agreement.
19.3. ASSIGNMENT; BINDING EFFECT
This Agreement, and the rights and obligations of the parties
created hereunder, shall not be assigned or delegated by either Lehigh or
Intracel without the prior written consent of all parties, and any purported or
attempted assignment or delegation without such consent shall be void and
without effect, except that (i) either party may assign or delegate its rights
and obligations under this Agreement to any successor to such party in the event
of a merger or consolidation of such party with another entity, or to any
purchaser of all or substantially all of the assets or business of such party,
and (ii) either party may assign or delegate its rights and obligations under
this Agreement to an Affiliate (as defined below) in which case the assigning or
delegating party shall not be relieved of their obligations hereunder. Any such
successor, purchaser or Affiliate shall execute a counterpart to the
Stockholders Agreement. For purposes of this Section 19.3, an Affiliate shall
mean, as to any party hereto, any corporation or other entity which,
- 28 -
29
directly or indirectly, through one or more intermediaries, controls (i.e.,
possesses, directly or indirectly, the power to direct or cause the direction of
the management and policies of an entity, whether through ownership of voting
securities, by contract, or otherwise) is controlled by, or is under common
control with such party. Subject to the foregoing, this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors, assigns, heirs, executors, administrators, and/or personal
representatives.
19.4. GOVERNING LAW
This Agreement and the rights and obligations of the parties
hereto shall be governed by and construed and enforced in accordance with the
laws of the Maryland (excluding the choice of law rules thereof).
19.5. SEVERABILITY
In the event that a court of competent jurisdiction holds that a
particular provision or requirement of this Agreement is in violation of any
applicable law, each such provision or requirement shall be enforced only to the
extent it is not in violation of such law or is not otherwise unenforceable and
all other provisions and requirements of this Agreement shall remain in full
force and effect.
19.6. EXPENSES; ATTORNEYS' FEES
The parties shall pay their own respective expenses (including,
without limitation, the fees, disbursements and expenses of their attorneys,
accountants, actuaries, and financial and other advisors) in connection with the
negotiation and preparation of this Agreement and the transactions contemplated
hereby. If any party is required to institute legal action or arbitration
against another party to enforce the provisions of this Agreement, the
prevailing party shall be entitled to recover costs of litigation, including,
but without limitation, reasonable attorneys' fees.
19.7. MODIFICATION; WAIVER
This Agreement shall not be modified or amended except by an
instrument in writing signed by Lehigh and Intracel. No delay or failure on the
part of any party hereto in exercising any right, power, or privilege under this
Agreement or any other instruments executed and delivered in connection with or
pursuant to this Agreement, shall impair any such right, power, or privilege or
be construed as a waiver of any default hereunder or any acquiescence therein.
No single or partial exercise of any such right, power, or privilege shall
preclude the
- 29 -
30
further exercise of such right, power, or privilege, or the exercise of any
other right, power, or privilege. No waiver shall be valid against any party
hereto unless made in writing and signed by the party against whom enforcement
of such waiver is sought and then only to the extent expressly specified
therein.
19.8. NOTICE
All notices, demands, requests or other communications which may
be or are required to be given, served or sent by any party to any other party
pursuant to this Agreement shall be in writing and shall be hand delivered
(including delivery by courier), sent by Federal Express or by other recognized
overnight delivery service, mailed by first-class, registered or certified mail,
return receipt requested, postage prepaid, or sent by telegram, telex, or
facsimile transmission, addressed as follows:
If to Intracel:
Intracel Corporation
0000 Xxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxx X. Xxxxx
Facsimile: (000) 000-0000
with a copy (which shall not constitute notice) to:
Xxxxx & Xxxxxxx L.L.P.
000 00xx Xxxxxx, X. X.
Xxxxxxxxxx, X.X. 00000-0000
Attn: Xxxxx X. Xxxxxxx, Esq.
Facsimile: (000) 000-0000
If to Lehigh:
Lehigh Valley Hospital and Health Network
Xxxxx Xxxxx & X-00
X.X. Xxx 000
Xxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attn: Xxxxx X. Xxxxxxxxx
Facsimile: (000) 000-0000
- 30 -
31
with a copy (which shall not constitute notice) to:
Xxxxxxx, Hudders & Xxxxxxxxxx
The Paragon Centre
0000 Xxxx Xxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attn: Xxxxxxx X. Xxxxxxxxxx, Esq.
Facsimile: (000) 000-0000
Each party may designate by notice in writing a new address to
which any notice, demand, request or communication may thereafter be so given,
served, or sent. Each notice, demand, request, or communication which shall be
mailed, delivered, or transmitted in the manner described above shall be deemed
sufficiently given, served, sent, or received for all purposes at such time as
it is delivered to the addressee (with the return receipt, the delivery receipt,
the affidavit of messenger, or (with respect to a telex or facsimile) the answer
back being deemed conclusive, but not exclusive, evidence of such delivery) or
at such time as delivery is refused by the addressee upon presentation.
19.9. BENEFIT OF THIS AGREEMENT
It is the explicit intention of the parties hereto that except
as set forth below no person or entity other than a party hereto is or shall be
entitled to bring any action to enforce any provision of this Agreement against
any of the parties hereto, and that the covenants, undertakings, and agreements
set forth in this Agreement shall be solely for the benefit of, and shall be
enforceable only by, the parties hereto or their respective successors and
assigns as permitted hereunder. Notwithstanding the foregoing, ICC shall be a
third party beneficiary hereto with respect to the enforcement of, and only to
the extent of, any rights it may have hereunder.
19.10. COMPLETE AGREEMENT
This Agreement sets forth the entire agreement of the parties
hereto with respect to its subject matter and any all prior agreements, whether
oral or written, between or among the parties hereto and relating to the subject
matter hereof are superseded hereby.
19.11. CONTRACT MODIFICATIONS FOR PROSPECTIVE LEGAL EVENTS
In the event any state or federal laws or regulations, now
existing or enacted or promulgated after the date hereof, are interpreted by
judicial decision, a
- 31 -
32
regulatory agency or legal counsel in such manner as to
indicate that this Agreement or any provision hereof may be in violation of such
laws or regulations, Intracel and Lehigh shall amend this Agreement as necessary
to preserve the underlying economic and financial arrangements between Intracel
and Lehigh and without substantial economic detriment to either party. Neither
party shall claim or assert illegality as a defense to the enforcement of this
Agreement or any provision hereof; instead any such purported illegality shall
be resolved pursuant to the terms of this Section 19.11.
19.12. EXECUTION IN COUNTERPARTS
This Agreement may be executed in counterparts, each of which
shall constitute an original hereof for all purposes.
- 32 -
33
IN WITNESS WHEREOF, each of the parties has duly caused this
Agreement to be duly executed in its name and on its behalf, as of the date
first written above.
INTRACEL:
INTRACEL CORPORATION
By:__________________________________
Name:________________________________
Title:_______________________________
LEHIGH:
LEHIGH VALLEY HOSPITAL AND HEALTH NETWORK
By:__________________________________
Name:________________________________
Title:_______________________________
- 33 -
34
EXHIBIT A
CERTIFICATE OF INCORPORATION
OF
INTRACEL CANCER CENTER OF PENNSYLVANIA, INC.
1. NAME
The name of this corporation is INTRACEL CANCER CENTER OF PENNSYLVANIA,
INC. (the "Corporation").
2. REGISTERED OFFICE AND AGENT
The registered office of the Corporation shall be located at the
Corporation Trust Center, 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000 in the
County of New Castle. The registered agent of the Corporation at such address
shall be The Corporation Trust Company.
3. PURPOSE AND POWERS
The purpose of the Corporation is to engage in any lawful act or
activity for which corporations may be organized under the General Corporation
Law of the State of Delaware (the "Delaware General Corporation Law"). The
Corporation shall have all power necessary or helpful to engage in such acts and
activities.
4. CAPITAL STOCK
4.1. Authorized Shares
The total number of shares of all classes of stock that the Corporation
shall have the authority to issue is Three Thousand (3,000) shares of Common
Stock, all of one class, having a par value of $.01 per share ("Common Stock").
35
4.2 RELATIVE RIGHTS
Each share of Common Stock shall have the same relative rights as
and be identical in all respects to all the other shares of Common Stock.
4.3 DIVIDENDS
Dividends may be paid on the Common Stock out of any assets legally
available for the payment of dividends thereon, but only when and as declared
by the Board of Directors of the Corporation.
4.4 VOTING RIGHTS
Each holder of shares of Common Stock shall be entitled to attend
all special and annual meetings of the stockholders of the Corporation and to
cast one vote for each outstanding share of Common Stock so held upon any
matter or thing (including, without limitation, the election of one or more
directors) properly considered and acted upon by the stockholders.
5. INCORPORATOR; INITIAL DIRECTORS
5.1 INCORPORATOR
The name and mailing address of the incorporator (the
"Incorporator") are The Corporation Trust Company, Corporation Trust Center,
0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000. The powers of the Incorporator
shall terminate upon the filing of this Certificate of Incorporation.
5.2 INITIAL DIRECTORS
The following persons, having the following mailing addresses,
shall serve as the directors of the Corporation until the first annual meeting
of the stockholders of the Corporation or until their successors are elected
and qualified:
NAME MAILING ADDRESS
------------------- -------------------------
------------------- -------------------------
------------------- -------------------------
------------------- -------------------------
------------------- -------------------------
-2-
36
6. BOARD OF DIRECTORS
6.1 NUMBER; ELECTION
The number of directors of the Corporation shall be such number as
from time to time shall be fixed by, or in the matter provided in, the bylaws
of the Corporation. Unless and except to the extent that the bylaws of the
Corporation shall otherwise require, the election of directors of the
Corporation need not be by written ballot.
6.2 LIMITATION OF LIABILITY
No director of the Corporation shall be liable to the Corporation
or its stockholders for monetary damages for breach of fiduciary duty as a
director, provided that this provision shall not eliminate or limit the
liability of a director (a) for any breach of the director's duty of loyalty to
the Corporation or its stockholders; (b) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of law;
(c) under Section 174 of the Delaware General Corporation Law; or (d) for any
transaction from which the director derived an improper personal benefit. Any
repeal or modification of this Article 6.2 shall be prospective only and shall
not adversely affect any right or protection of, or any limitation of the
liability of, a director of the Corporation existing at, or arising out of
facts or incidents occurring prior to, the effective date of such repeal or
modification.
7. COMPROMISE OR ARRANGEMENTS
Whenever a compromise or arrangement is proposed between this Corporation
and its creditors or any class of them and/or between this Corporation and its
stockholders or any class of them, any court of equitable jurisdiction within
the State of Delaware may, on the application in a summary way of this
Corporation or of any creditor or stockholder thereof or on the application of
any receiver or receivers appointed for this Corporation under Section 291 of
Title 8 of the Delaware Code or on the application of trustees in dissolution
or of any receiver or receivers appointed for this Corporation under Section
279 of Title 8 of the Delaware Code order a meeting of the creditors or class
of creditors, and/or of the stockholders or class of stockholders of this
Corporation, as the case may be, to be summoned in such manner as the said
court directs. If a majority in number representing three fourths in value of
the creditors or class of creditors, and/or of the stockholders or class of
stockholders of this Corporation, as the case may be, agree to any compromise
or arrangement and to any reorganization of this Corporation as consequence of
such compromise or arrangement, the said compromise or arrangement and the said
reorganization shall, if sanctioned by the court to which the said application
has been made, be binding on all the creditors or class of
-3-
37
creditors, and/or on all the stockholders or class of stockholders, of this
Corporation, as the case may be, and also on this Corporation.
8. AMENDMENT OF BYLAWS
In furtherance and not in limitation of the powers conferred by the
Delaware General Corporation Law, the Board of Directors of the Corporation is
expressly authorized and empowered to adopt, amend and repeal the bylaws of
the Corporation.
IN WITNESS WHEREOF, the undersigned, being the Incorporator
hereinabove named, for the purposes of forming a corporation pursuant to the
Delaware General Corporation Law, hereby certifies that the facts hereinabove
stated are truly set forth, and accordingly execute this Certificate of
Incorporation this ____ day of ______________, ____.
THE CORPORATION TRUST
COMPANY
Incorporator
By:______________________________
-4-
38
EXHIBIT B-1
INTRACEL CANCER CENTER OF PENNSYLVANIA, INC.
UNANIMOUS CONSENT OF DIRECTORS
The undersigned, being all of the directors of Intracel Cancer Center of
Pennsylvania, Inc., a Delaware corporation (the "CORPORATION"), for the purpose
of taking action without a meeting of the Board of Directors pursuant to
Sections 108 and 141(f) of the General Corporation Law of the State of
Delaware, hereby adopt the following resolutions:
1. BYLAWS
RESOLVED, that the proposed Bylaws attached hereto as Exhibit A are
hereby adopted as the Bylaws of the Corporation, and the Secretary of the
Corporation is hereby directed to insert said Bylaws in the Minute Book of the
Corporation.
2. OFFICERS
RESOLVED, that the following persons are hereby appointed to serve as
officers of the Corporation, holding the offices indicated opposite their
names, until their respective successors are appointed and qualified or until
their earlier resignation or removal:
NAME OFFICE
___________________ [Chairperson]
___________________ [President and Treasurer]
___________________ [Secretary]
3. PRINCIPAL OFFICE
RESOLVED, that the principal office of the Corporation shall be
established and maintained in ____________________.
39
4. STOCK CERTIFICATE
RESOLVED, that the form of stock certificate attached hereto as Exhibit B
is hereby approved and adopted, and the Secretary is hereby directed to insert
a specimen thereof in the Minute Book of the Corporation.
5. FISCAL YEAR
RESOLVED, that the fiscal year of the Corporation shall be the calendar
year.
6. ORGANIZATION EXPENSES
RESOLVED, that the Treasurer is hereby authorized to pay all fees and
expenses that such officer determines to be necessary or advisable in
connection with the organization of the Corporation (such determination to be
conclusively, but not exclusively, evidenced by the payment of such fees or
expenses).
7. QUALIFICATION TO DO BUSINESS
RESOLVED, that the President, Secretary and any Vice President, and each
of them, are hereby authorized (1) to take all actions and to execute and file
all instruments that any such officer determines to be necessary or advisable
in order to qualify the Corporation under any law or laws in any state, country
or other jurisdiction in which any such officer determines it to be necessary
or advisable for the Corporation to conduct activities, including without
limitation the appointment and substitution of agents or attorneys for service
of process, and the designation and change of statutory offices, and to effect
withdrawal from any state, country or other jurisdiction whenever any such
officer determines it to be necessary or advisable for the Corporation to cease
conducting activities therein; and (2) to make all such other filings with the
governmental entities of the United States or of any state, country or other
jurisdiction as such officer may determine to be necessary or advisable in
connection with the conduct of the affairs of the Corporation (any
determination pursuant to this resolution to be conclusively, but not
exclusively, evidenced by the taking of such actions or the execution of such
instruments).
8. BANK ACCOUNTS
RESOLVED, that the President and Secretary of the Corporation, and each of
them, are hereby authorized to open an account or accounts for and in the name
of the Corporation with such bank or banks in the State of Delaware, and in any
other state, country or other jurisdiction, as they, or either of them, may
determine to be necessary or advisable in conducting the affairs of the
Corporation (such
-2-
40
determination to be conclusively, but not exclusively, evidenced by the opening
of such account or accounts), and to deposit therein funds coming into the
possession of the Corporation;
RESOLVED FURTHER, that all such banks are hereby authorized and directed
to pay checks and other orders for the payment of money drawn on the name of
the Corporation when signed by the President of the Corporation or by any
employee designated in writing by ??? and no such bank shall be required, in
any case, to make inquiry respecting the application of any instrument executed
by virtue of this resolution, or of the proceeds therefrom, nor be under any
obligation to see the application of such instrument or proceeds; and
RESOLVED FURTHER, that all resolutions required by such banks in
connection with such accounts that are consistent with the foregoing are hereby
adopted, and the Secretary is directed to attach copies of all such resolutions
to these resolutions.
9. FILING OF CONSENT
RESOLVED, that this Consent shall be filed with the minutes and records
of the Corporation.
10. GENERAL
RESOLVED, that each of the officers of the Corporation hereby is
authorized to do all things, to take all actions and to execute, deliver and
file all documents and instruments, in the name and on behalf of the
Corporation, as such officer may determine to be necessary or advisable in
effecting the foregoing resolutions and the transactions contemplated
thereunder (such determination to be conclusively, but not exclusively,
evidenced by the taking of such actions or the execution of such documents or
instruments by any such officer).
-3-
41
IN WITNESS WHEREOF, each of the undersigned has executed and delivered
this Unanimous Consent of Directors as of the date set forth below.
Dated as of _________________, 199
__________________________
By:_______________________
Name:_____________________
__________________________
By:_______________________
Name:_____________________
__________________________
By:_______________________
Name:_____________________
__________________________
By:_______________________
Name:_____________________
__________________________
By:_______________________
Name:_____________________
-4-
42
EXHIBIT B-2
INTRACEL CANCER CENTER OF PENNSYLVANIA, INC.
BYLAWS
Adopted
as of
_________________, 199_
43
TABLE OF CONTENTS
1. OFFICES................................................................ 1
1.1. Registered Office................................................. 1
1.2. Other Offices..................................................... 1
2. MEETINGS OF STOCKHOLDERS............................................... 1
2.1. Place of Meetings................................................. 1
2.2. Annual Meetings................................................... 1
2.3. Special Meetings.................................................. 2
2.4. Notice of Meetings................................................ 2
2.5. Waivers of Notice................................................. 2
2.6. Business at Special Meetings...................................... 2
2.7. List of Stockholders.............................................. 3
2.8. Quorum at Meetings................................................ 3
2.9. Voting and Proxies................................................ 3
2.10 Required Vote..................................................... 4
2.11 Action Without a Meeting.......................................... 4
3. DIRECTORS.............................................................. 5
3.1. Powers............................................................ 5
3.2. Number and Election............................................... 5
3.3. Designation of Directors.......................................... 5
3.4. Vacancies......................................................... 5
3.5. Meetings.......................................................... 6
3.5.1. Regular Meetings.......................................... 6
3.5.2. Special Meetings.......................................... 6
3.5.3. Telephone Meetings........................................ 6
3.5.4. Action Without Meeting.................................... 6
3.5.5. Waiver of Notice of Meeting............................... 6
3.6 Quorum and Vote at Meetings........................................ 7
3.7 Committees of Directors............................................ 7
3.8 Compensation of Directors.......................................... 8
4. OFFICERS............................................................... 8
4.1. Positions......................................................... 8
4.2. Chairperson....................................................... 8
4.3. President......................................................... 9
4.4. Vice President.................................................... 9
4.5. Secretary......................................................... 9
4.6. Assistant Secretary............................................... 9
4.7. Treasurer.........................................................10
44
4.8. Assistant Treasurer...............................................10
4.9. Term of Office....................................................10
4.10. Compensation.....................................................10
4.11. Fidelity Bonds...................................................10
5. CAPITAL STOCK..........................................................11
5.1. Certificates of Stock; Uncertificated Shares......................11
5.2. Lost Certificates.................................................11
5.3. Record Date.......................................................12
5.3.1. Actions by Stockholders..................................12
5.3.2. Payments.................................................12
5.4. Stockholders of Record............................................13
6. INDEMNIFICATION; INSURANCE.............................................13
6.1. Authorization of Indemnification..................................13
6.2. Right of Claimant to Bring Action Against the Corporation.........14
6.3. Non-exclusivity...................................................15
6.4. Survival of Indemnification.......................................15
6.5. Insurance.........................................................15
7. GENERAL PROVISIONS.....................................................16
7.1. Inspection of Books and Records...................................16
7.2. Dividends.........................................................16
7.3. Reserves..........................................................16
7.4. Execution of Instruments..........................................16
7.5. Fiscal Year.......................................................16
7.6. Seal..............................................................17
45
BYLAWS
OF
INTRACEL CANCER CENTER OF PENNSYLVANIA, INC.
1. OFFICES
1.1 REGISTERED OFFICE
The initial registered office of the Corporation shall be in
Wilmington, Delaware, and the initial registered agent in charge thereof shall
be The Corporation Trust Company.
1.2 OTHER OFFICES
The Corporation may also have offices at such other places, both
within and without the State of Delaware, as the Board of Directors may from
time to time determine or as may be necessary or useful in connection with the
business of the Corporation.
2. MEETINGS OF STOCKHOLDERS
2.1 PLACE OF MEETINGS
All meetings of the stockholders shall be held at such place as may
be fixed from time to time by the Board of Directors, the Chairperson or the
President.
2.2 ANNUAL MEETINGS
The Corporation shall hold annual meetings of stockholders,
commencing with the year _______, on such date and at such time as shall be
designated from time to time by the Board of Directors, the Chairperson or the
President, at which stockholders shall elect a Board of Directors and transact
such other business as may properly be brought before the meeting.
46
2.3. SPECIAL MEETINGS
Special meetings of the stockholders, for any purpose or purposes,
unless otherwise prescribed by statute, may be called by the Board of
Directors, the Chairperson or the President.
2.4. NOTICE OF MEETINGS
Notice of any meeting of stockholders, stating the place, date and
hour of the meeting, and (if it is a special meeting) the purpose or purposes
for which the meeting is called, shall be given to each stockholder entitled to
vote at such meeting not less than ten nor more than sixty days before the date
of the meeting (except to the extent that such notice is waived or is not
required as provided in the General Corporation Law of the State of Delaware
(the "Delaware General Corporation Law") or these Bylaws). Such notice shall be
given in accordance with, and shall be deemed effective as set forth in,
Section 222 (or any successor section) of the Delaware General Corporation Law.
2.5. WAIVERS OF NOTICE
Whenever the giving of any notice is required by statute, the
Certificate of Incorporation or these Bylaws, a waiver thereof, in writing and
delivered to the Corporation, signed by the person or persons entitled to said
notice, whether before or after the event as to which such notice is required,
shall be deemed equivalent to notice. Attendance of a stockholder at a meeting
shall constitute a waiver of notice (1) of such meeting, except when the
stockholder at the beginning of the meeting objects to holding the meeting or
transacting business at the meeting, and (2) (if it is a special meeting) of
consideration of a particular matter at the meeting that is not within the
purpose or purposes described in the meeting notice, unless the stockholder
objects to considering the matter at the beginning of the meeting.
2.6 BUSINESS AT SPECIAL MEETINGS
Business transacted at any special meeting of stockholders shall be
limited to the purposes stated in the notice (except to the extent that such
notice is waived or is not required as provided in the Delaware General
Corporation Law or these Bylaws).
-2-
47
2.7. LIST OF STOCKHOLDERS
After the record date for a meeting of stockholders has been
fixed, at least ten days before such meeting, the officer who has charge of the
stock ledger of the Corporation shall make a list of all stockholders entitled
to vote at the meeting, arranged in alphabetical order and showing the
address of each stockholder and the number of shares registered in the name of
each stockholder. Such list shall be open to the examination of any stockholder
for any purpose germane to the meeting, during ordinary business hours, for a
period of at least ten days prior to the meeting, either at a place in the city
where the meeting is to be held, which place is to be specified in the notice
of the meeting, or at the place where the meeting is to be held. Such list
shall also, for the duration of the meeting, be produced and kept open to the
examination of any stockholder who is present at the time and place of the
meeting.
2.8. QUORUM AT MEETINGS
Stockholders may take action on a matter at a meeting only if a
quorum exists with respect to that matter. Except as otherwise provided by
statute or by the Certificate of Incorporation, the holders of a majority of
the shares entitled to vote at the meeting, and who are present in person or
represented by proxy, shall constitute a quorum at all meetings of the
stockholders for the transaction of business. Where a separate vote by a class
or classes is required, a majority of the outstanding shares of such class or
classes, present in person or represented by proxy, shall constitute a quorum
entitled to take action with respect to that vote on that matter. Once a share
is represented for any purpose at a meeting (other than solely to object (1) to
holding the meeting or transacting business at the meeting, or (2) (if it is a
special meeting) to consideration of a particular matter at the meeting that is
not within the purpose or purposes described in the meeting notice), it is
deemed present for quorum purposes for the remainder of the meeting and for any
adjournment of that meeting unless a new record date is or must be set for the
adjourned meeting. The holders of a majority of the voting shares represented
at a meeting, whether or not a quorum is present, may adjourn such meeting from
time to time.
2.9. VOTING AND PROXIES
Unless otherwise provided in the Delaware General Corporation
Law or in the Corporation's Certificate of Incorporation, and subject to the
other provisions of these Bylaws, each stockholder shall be entitled to one
vote on each matter, in person or by proxy, for each share of the Corporation's
capital stock that has voting power and that is held by such stockholder. No
proxy shall be voted or
-3-
48
acted upon after three years from its date, unless the proxy provides for a
longer period. A duly executed appointment of proxy shall be irrevocable if the
appointment form states that it is irrevocable and if, and only as long as, it
is coupled with an interest sufficient in law to support an irrevocable power.
2.10. REQUIRED VOTE
When a quorum is present at any meeting of stockholders, all
matters shall be determined, adopted and approved by the affirmative vote
(which need not be by ballot) of the holders of a majority of the shares
present in person or represented by proxy at the meeting and entitled to vote
with respect to the matter, unless the proposed action is one upon which, by
express provision of statutes, the Certificate of Incorporation or the
Stockholders' Agreement dated as of __________, 199_ by and between the
Corporation and the stockholders (the "Stockholders' Agreement"), a different
vote is specified and required, in which case such express provision shall
govern and control with respect to that vote on that matter. Where a separate
vote by a class or classes is required, the affirmative vote of the holders of
a majority of the shares of such class or classes present in person or
represented by proxy at the meeting shall be the act of such class.
Notwithstanding the foregoing, directors shall be elected by a plurality of the
votes of the shares present in person or represented by proxy at the meeting
and entitled to vote on the election of directors.
2.11. ACTION WITHOUT A MEETING
Any action required or permitted to be taken at a stockholders'
meeting may be taken without a meeting, without prior notice and without a vote,
if the action is taken by persons who would be entitled to vote at a meeting and
who hold shares having voting power equal to not less than the minimum number of
votes that would be necessary to authorize or take the action at a meeting at
which all shares entitled to vote were present and voted. The action must be
evidenced by one or more written consents describing the action taken, signed by
the stockholders entitled to take action without a meeting, and delivered to the
Corporation in the manner prescribed by the Delaware General Corporation Law for
inclusion in the minute book. No consent shall be effective to take the
corporate action specified unless the number of consents required to take such
action are delivered to the Corporation within sixty days of the delivery of the
earliest-dated consent. Written notice of the action taken shall be given in
accordance with the Delaware General Corporation Law to all stockholders who do
not participate in taking the action who would have been entitled to notice if
such action had been taken at a meeting having a record date on the date that
written consents signed by a sufficient number of holders to take the action
were delivered to the Corporation.
-4-
49
3. DIRECTORS
3.1 POWERS
The business and affairs of the Corporation shall be managed by or
under the direction of the Board of Directors, which may exercise all such
powers of the Corporation and do all such lawful acts and things, subject to
any limitation set forth in the Certificate of Incorporation, these Bylaws, or
as otherwise may be provided in the Delaware General Corporation Law or in the
Stockholders' Agreement.
3.2 NUMBER AND ELECTION
The number of directors which shall constitute the whole board
shall not be fewer than three nor more than seven. The first board shall
consist of five directors. Thereafter, within the limits above specified and
subject to the terms of SECTION 3.2(b) of the Stockholders' Agreement, the
number of directors shall be determined by resolution of the Board of Directors.
3.3 DESIGNATION OF DIRECTORS
Candidates for election as directors shall be designated by the
stockholders as provided in the Stockholders' Agreement. The directors shall be
elected at the annual meeting of the stockholders, except as provided in
SECTION 3.4 hereof, and each director elected shall hold office until such
director's successor is elected and qualified or until the director's earlier
death, resignation or removal. Directors need not be stockholders.
3.4 VACANCIES
Vacancies in any directorships resulting from the removal,
resignation or death of an director and newly created directorships resulting
from any increase in the authorized number of directors shall be filled by the
affirmative vote of a majority of stockholders, subject to any conditions or
limitations set forth in the Stockholders' Agreement. Each director so chosen
shall hold office until the next election of directors of the class to which
such director was appointed, and until such director's successor is elected and
qualified, or until the director's earlier death, resignation or removal. In
the event that one or more directors resign from the Board, effective at a
future date, the stockholders shall have power to fill such vacancy or
vacancies, the vote thereon to take effect when such resignation or
resignations shall become effective, and each director so chosen shall hold
office
-5-
50
until the next election of directors, and until such director's successor is
elected and qualified, or until the director's earlier death, resignation or
removal.
3.5 MEETINGS
3.5.1. REGULAR MEETINGS
Regular meetings of the Board of Directors may be held without notice
at such time and at such place as shall from time to time be determined by the
Board of Directors.
3.5.2. SPECIAL MEETINGS
Special meetings of the Board may be called by the Chairperson or
President on one day's notice to each director, either personally or by
telephone, express delivery service (so that the scheduled delivery date of
the notice is at least one day in advance of the meeting), telegram or
facsimile transmission, and on five days' notice by mail (effective upon
deposit of such notice in the mail). The notice need not describe the purpose
of a special meeting.
3.5.3. TELEPHONE MEETINGS
Members of the Board of Directors may participate in a meeting of the
board by any communication by means of which all participating directors
can simultaneously hear each other during the meeting. A director participating
in a meeting by this means is deemed to be present in person at the meeting.
3.5.4. ACTION WITHOUT MEETING
Any action required or permitted to be taken at any meeting of the
Board of Directors may be taken without a meeting if the action is taken by all
members of the Board. The action must be evidenced by one or more written
consents describing the action taken, signed by each director, and delivered to
the Corporation for inclusion in the minute book.
3.5.5. WAIVER OF NOTICE OF MEETING
A director may waive any notice required by statute, the Certificate
of Incorporation or these Bylaws before or after the date and time stated in
the notice. Except as set forth below, the waiver must be in writing, signed by
the director entitled to the notice, and delivered to the Corporation for
inclusion in the minute book. Notwithstanding the foregoing, a director's
attendance at or participation in a meeting waives any required notice to the
director of the meeting unless the
-6-
51
director at the beginning of the meeting objects to holding the meeting or
transacting business at the meeting and does not thereafter vote for or assent
to action taken at the meeting.
3.6. QUORUM AND VOTE AT MEETINGS
At all meetings of the board, a quorum of the Board of Directors
consists of a majority of the total number of directors prescribed pursuant to
SECTION 3.2 of these Bylaws, except as may be otherwise specifically provided
by the Stockholders' Agreement. The vote of a majority of the directors present
at any meeting at which there is a quorum shall be the act of the Board of
Directors, except as may be otherwise specifically provided by statute, or by
the Certificate of Incorporation, or by these Bylaws, or by the Stockholders'
Agreement. Pursuant to SECTION 3.2 of the Stockholders' Agreement, a
supermajority vote of directors is required for the Corporation to take certain
actions.
3.7. COMMITTEES OF DIRECTORS
The Board of Directors may designate one or more committees, each
committee to consist of one or more directors. The Board may designate one or
more directors as alternate members of any committee, who may replace any
absent or disqualified member at any meeting of the committee. If a member of a
committee shall be absent from any meeting, or disqualified from voting
thereat, the remaining member or members present and not disqualified from
voting, whether or not such member or members constitute a quorum, may, by
unanimous vote, appoint another member of the Board of Directors to act at the
meeting in the place of such absent or disqualified member. Any such committee,
to the extent provided in the resolution of the Board of Directors, shall have
and may exercise all the powers and authority of the Board of Directors in the
management of the business and affairs of the Corporation, and may authorize
the seal of the Corporation to be affixed to all papers which may require it;
but no such committee shall have the power or authority in reference to
approving or adopting, or recommending to the stockholders, any action or
matter expressly required by the Delaware General Corporation Law to be
submitted to stockholders for approval or adopting, amending or repealing any
bylaw of the Corporation, and unless the resolution designating the committee,
these bylaws or the Certificate of Incorporation expressly so provide, no such
committee shall have the power or authority to declare a dividend, to authorize
the issuance of stock, or to adopt a certificate of ownership and merger
pursuant to Section 253 of the Delaware General Corporation Law. Such committee
or committees shall have such name or names as may be determined from time to
time by resolution adopted by the Board of Directors. Each committee shall keep
regular minutes of its meetings and report
-7-
52
the same to the Board of Directors, when required. Unless otherwise specified
in the Board resolution appointing the Committee, all provisions of the
Delaware General Corporation Law and these Bylaws relating to meetings, action
without meetings, notice (and waiver thereof), and quorum and voting
requirements of the Board of Directors apply, as well, to such committee and
their members.
3.8. COMPENSATION OF DIRECTORS
The Board of Directors shall have the authority to fix the
compensation of directors. No such payment shall preclude any director from
serving the Corporation in any other capacity and receiving compensation
therefor.
4. OFFICERS
4.1. POSITIONS
The officers of the Corporation shall be a Chairperson, a President, a
Secretary and a Treasurer, and such other officers as the Board of Directors (or
an officer authorized by the Board of Directors) from time to time may appoint,
including one or more Vice Chairmen, Executive Vice Presidents, Vice Presidents,
Assistant Secretaries and Assistant Treasurers. Each such officer shall exercise
such powers and perform such duties as shall be set forth below and such other
powers and duties as from time to time may be specified by the Board of
Directors or by any officer(s) authorized by the Board of Directors to prescribe
the duties of such other officers. Any number of offices may be held by the same
person, except that in no event shall the President and the Secretary be the
same person. As set forth below, each of the Chairperson, President, and/or any
Vice President may execute bonds, mortgages and other contracts under the seal
of the Corporation, if required, except where required or permitted by law to be
otherwise executed and except where the execution thereof shall be expressly
delegated by the Board of Directors to some other officer or agent of the
Corporation.
4.2. CHAIRPERSON
The Chairperson shall be the chief executive officer of the
Corporation, shall have overall responsibility and authority for management of
the operations of the Corporation (subject to the authority of the Board of
Directors), shall (when present) preside at all meetings of the Board of
Directors and stockholders, and shall ensure that all orders and resolutions of
the Board of Directors and stockholders are carried into effect. The
Chairperson may execute bonds, mortgages and other contracts, under the seal of
the Corporation, if required, except where
-8-
53
required or permitted by law to be otherwise signed and executed and except
where the signing and execution thereof shall be expressly delegated by the
Board of Directors to some other officer or agent of the Corporation.
4.3 PRESIDENT
The President shall be the chief operating officer of the Corporation
and shall have full responsibility and authority for management of the
day-to-day operations of the Corporation, subject to the authority of the Board
of Directors and Chairperson. The President may execute bonds, mortgages and
other contracts, under the seal of the Corporation, if required, except where
required or permitted by law to be otherwise signed and executed and except
where the signing and execution thereof shall be expressly delegated by the
Board of Directors to some other officer or agent of the Corporation.
4.4 VICE PRESIDENT
In the absence of the President or in the event of the President's
inability or refusal to act, the Vice President (or in the event there be more
than one Vice President, the Vice Presidents in the order designated, or in the
absence of any designation, then in the order of their election) shall perform
the duties of the President, and when so acting shall have all the powers of,
and be subject to all the restrictions upon, the President.
4.5 SECRETARY
The Secretary shall have responsibility for preparation of minutes of
meetings of the Board of Directors and of the stockholders and for
authenticating records of the Corporation. The Secretary shall give, or cause
to be given, notice of all meetings of the stockholders and special meetings of
the Board of Directors. The Secretary or an Assistant Secretary may also attest
all instruments signed by any other officer of the Corporation.
4.6 ASSISTANT SECRETARY
The Assistant Secretary, or if there be more than one, the Assistant
Secretaries in the order determined by the Board of Directors (or if there
shall have been no such determination, then in the order of their election),
shall, in the absence of the Secretary or in the event of the Secretary's
inability or refusal to act, perform the duties and exercise the powers of the
Secretary.
-9-
54
4.7. TREASURER
The Treasurer shall be the chief financial officer of the
Corporation and shall have responsibility for the custody of the corporate funds
and securities and shall see to it that full and accurate accounts of receipts
and disbursements are kept in books belonging to the Corporation. The Treasurer
shall render to the Chairperson, the President, and the Board of Directors, upon
request, an account of all financial transactions and of the financial condition
of the Corporation.
4.8. ASSISTANT TREASURER
The Assistant Treasurer, or if there shall be more than one, the
Assistant Treasurers in the order determined by the Board of Directors (or if
there shall have been no such determination, then in the order of their
election), shall, in the absence of the Treasurer or in the event of the
Treasurer's inability or refusal to act, perform the duties and exercise the
powers of the Treasurer.
4.9. TERM OF OFFICE
The officers of the Corporation shall hold office until their
successors are chosen and qualify or until their earliest resignation or
removal. Any officer may resign at any time upon written notice to the
Corporation. Any officer elected or appointed by the Board of Directors may be
removed at any time, with or without cause, by the affirmative vote of a
majority of the Board of Directors.
4.10. COMPENSATION
The compensation of officers of the Corporation shall be fixed by
the Board of Directors or by any officer(s) authorized by the Board of Directors
to prescribe the compensation of such other officers.
4.11. FIDELITY BONDS
The Corporation may secure the fidelity of any or all of its
officers or agents by bond or otherwise.
-10-
55
5. CAPITAL STOCK
5.1. CERTIFICATES OF STOCK; UNCERTIFICATED SHARES
The shares of the Corporation shall be represented by certificates,
provided that the Board of Directors may provide by resolution that some or all
of any or all classes or series of the Corporation's stock shall be
uncertificated shares. Any such resolution shall not apply to shares
represented by a certificate until such certificate is surrendered to the
Corporation. Notwithstanding the adoption of such a resolution by the Board of
Directors, every holder of stock represented by certificates, and upon request
every holder of uncertificated shares, shall be entitled to have a certificate
(representing the number of shares registered in certificate form) signed in
the name of the Corporation by the Chairperson, President or any Vice
President, and by the Treasurer, Secretary or any Assistant Treasurer or
Assistant Secretary of the Corporation. Any or all the signatures on the
certificate may be facsimile. In case any officer, transfer agent or registrar
whose signature or facsimile signature appears on a certificate shall have
ceased to be such officer, transfer agent or registrar before such certificate
is issued, it may be issued by the Corporation with the same effect as if such
person were such officer, transfer agent or registrar at the date of issue.
5.2. LOST CERTIFICATES
The Board of Directors, Chairperson, President or Secretary may
direct a new certificate of stock to be issued in place of any certificate
theretofore issued by the Corporation and alleged to have been lost, stolen or
destroyed, upon the making of an affidavit of that fact by the person claiming
that the certificate of stock has been lost, stolen or destroyed. When
authorizing such issuance of a new certificate, the board or any such officer
may, as a condition precedent to the issuance thereof, require the owner of
such lost, stolen or destroyed certificate or certificates, or such owner's
legal representative, to advertise the same in such manner as the board or such
officer shall require and/or to give the Corporation a bond or indemnity, in
such sum or on such terms and conditions as the board or such officer may
direct, as indemnity against any claim that may be made against the Corporation
on account of the certificate alleged to have been lost, stolen or destroyed or
on account of the issuance of such new certificate or uncertificated shares.
-11-
56
5.3. RECORD DATE
5.3.1. ACTIONS BY STOCKHOLDERS
In order that the Corporation may determine the stockholders
entitled to notice of or to vote at any meeting of stockholders, the Board of
Directors may fix a record date, which record date shall not precede the date
upon which the resolution fixing the record date is adopted by the Board of
Directors, and which record date shall not be more than sixty days nor less
than ten days before the date of such meeting. If no record date is fixed by
the Board of Directors, the record date for determining stockholders entitled
to notice of or to vote at a meeting of stockholders shall be the close of
business on the day next preceding the day on which notice is given, or, if
notice is waived, at the close of business on the day next preceding the day on
which the meeting is held. A determination of stockholders of record entitled
to notice of or to vote at a meeting of stockholders shall apply to any
adjournment of the meeting, unless the Board of Directors fixes a new record
date for the adjourned meeting.
In order that the Corporation may determine the stockholders
entitled to consent to corporate action in writing without a meeting, the Board
of Directors may fix a record date, which record date shall not precede the
date upon which the resolution fixing the record date is adopted by the Board
of Directors, and which record date shall not be more than ten days after the
date upon which the resolution fixing the record date is adopted by the Board
of Directors. If no record date has been fixed by the Board of Directors, the
record date for determining stockholders entitled to consent to corporate
action in writing without a meeting, when no prior action by the Board of
Directors is required by the Delaware General Corporation Law, shall be the
first date on which a signed written consent setting forth the action taken or
proposed to be taken is delivered to the Corporation in the manner prescribed
by Section 213(b) of the Delaware General Corporation Law. If no record date
has been fixed by the Board of Directors and prior action by the Board of
Directors is required by the Delaware General Corporation Law, the record date
for determining stockholders entitled to consent to corporate action in writing
without a meeting shall be at the close of business on the day on which the
Board of Directors adopts the resolution taking such prior action.
5.3.2. PAYMENTS
In order that the Corporation may determine the stockholders
entitled to receive payment of any dividend or other distribution or allotment
of any rights or the stockholders entitled to exercise any rights in respect of
any change, conversion or exchange of stock, or for the purpose of any other
lawful action, the Board of Directors may fix a record date, which record date
shall not precede the
-12-
57
date upon which the resolution fixing the record date is adopted, and which
record date shall be not more than sixty days prior to such action. If no
record date is fixed, the record date for determining stockholders for any such
purpose shall be at the close of business on the day on which the Board of
Directors adopts the resolution relating thereto.
5.4. STOCKHOLDERS OF RECORD
The Corporation shall be entitled to recognize the exclusive right
of a person registered on its books as the owner of shares to receive
dividends, to receive notifications, to vote as such owner, and to exercise all
the rights and powers of an owner. The Corporation shall not be bound to
recognize any equitable or other claim to or interest in such share or shares
on the part of any other person, whether or not it shall have express or other
notice thereof, except as otherwise may be provided by the Delaware General
Corporation Law.
6. INDEMNIFICATION: INSURANCE
6.1. AUTHORIZATION OF INDEMNIFICATION
Each person who was or is a party or is threatened to be made a
party to or is involved in any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative and
whether by or in the right of the Corporation or otherwise (a "proceeding"), by
reason of the fact that he or she, or a person of whom he or she is the legal
representative, is or was a director or officer of the Corporation or is or was
serving at the request of the Corporation as a director, officer, employee,
partner (limited or general) or agent of another corporation or of a
partnership, joint venture, limited liability company, trust or other
enterprise, including service with respect to an employee benefit plan, shall
be (and shall be deemed to have a contractual right to be) indemnified and held
harmless by the Corporation (and any successor to the Corporation by merger or
otherwise) to the fullest extent authorized by, and subject to the conditions
and (except as provided herein) procedures set forth in the Delaware General
Corporation Law, as the same exists or may hereafter be amended (but any such
amendment shall not be deemed to limit or prohibit the rights of
indemnification hereunder for past acts or omissions of any such person insofar
as such amendment limits or prohibits the indemnification rights that said law
permitted the Corporation to provide prior to such amendment) and in the
Certificate of Incorporation, against all expenses, liabilities and losses
(including attorneys' fees, judgments, fines, ERISA taxes or penalties and
amounts paid or to be paid in settlement) reasonably incurred or suffered by
such person in connection therewith;
-13-
58
provided, however, that the Corporation shall indemnify any such person seeking
indemnification in connection with a proceeding (or part thereof) initiated by
such person (except for a suit or action pursuant to SECTION 6.2 hereof) only
if such proceeding (or part thereof) was authorized by the Board of Directors
of the Corporation. Persons who are not directors or officers of the
Corporation and are not so serving at the request of the Corporation may be
similarly indemnified in respect of such service to the extent authorized at
any time by the Board of Directors of the Corporation. The indemnification
conferred in this SECTION 6.1 also shall include the right to be paid by the
Corporation (and such successor) the expenses (including attorneys' fees)
incurred in the defense of or other involvement in any such proceeding in
advance of its final disposition; provided, however, that, if and to the extent
the Delaware General Corporation Law requires, the payment of such expenses
(including attorneys' fees) incurred by a director or officer in advance of the
final disposition of a proceeding shall be made only upon delivery to the
Corporation of an undertaking by or on behalf of such director or officer to
repay all amounts so paid in advance if it shall ultimately be determined that
such director or officer is not entitled to be indemnified under this SECTION
6.1 or otherwise; and provided further, that, such expenses incurred by other
employees and agents may be so paid in advance upon such terms and conditions,
if any, as the Board of Directors deems appropriate.
6.2. RIGHT OF CLAIMANT TO BRING ACTION AGAINST THE CORPORATION
If a claim under SECTION 6.1 is not paid in full by the
Corporation within sixty days after a written claim has been received by the
Corporation, the claimant may at any time thereafter bring an action against
the Corporation to recover the unpaid amount of the claim and, if successful in
whole or in part, the claimant shall be entitled to be paid also the expense of
prosecuting such action. It shall be a defense to any such action (other than
an action brought to enforce a claim for expenses incurred in connection with
any proceeding in advance of its final disposition where the required
undertaking, if any is required, has been tendered to the Corporation) that the
claimant has not met the standards of conduct which make it permissible under
the Delaware General Corporation Law for the Corporation to indemnify the
claimant for the amount claimed or is otherwise not entitled to indemnification
under SECTION 6.1, but the burden of proving such defense shall be on the
Corporation. The failure of the Corporation (in the manner provided under the
Delaware General Corporation Law) to have made a determination prior to or
after the commencement of such action that indemnification of the claimant is
proper in the circumstances because he or she has met the applicable standard
of conduct set forth in the Delaware General Corporation Law shall not be a
defense to the action or create a presumption that the claimant has not met the
applicable standard of conduct. Unless otherwise
-14-
59
specified in an agreement with the claimant, an actual determination by the
Corporation (in the manner provided under the Delaware General Corporation Law)
after the commencement of such action that the claimant has not met such
applicable standard of conduct shall not be a defense to the action, but shall
create a presumption that the claimant has not met the applicable standard of
conduct.
6.3. NON-EXCLUSIVITY
The rights to indemnification and advance payment of expenses
provided by SECTION 6.1 hereof shall not be deemed exclusive of any other
rights to which those seeking indemnification and advance payment of expenses
may be entitled under any by-law, agreement, vote of stockholders or
disinterested directors or otherwise, both as to action in his or her official
capacity and as to action in another capacity while holding such office.
6.4. SURVIVAL OF INDEMNIFICATION
The indemnification and advance payment of expenses and rights
thereto provided by, or granted pursuant to, SECTION 6.1 hereof shall, unless
otherwise provided when authorized or ratified, continued as to a person who
has ceased to be a director, officer, employee, partner or agent and shall
inure to the benefit of the personal representatives, heirs, executors and
administrators of such person.
6.5. INSURANCE
The Corporation shall have power to purchase and maintain
insurance on behalf of any person who is or was a director, officer, employee
or agent of the Corporation, or is or was serving at the request of the
Corporation as a director, officer, employee, partner (limited or general) or
agent of another corporation or of a partnership, joint venture, limited
liability company, trust or other enterprise, against any liability asserted
against such person or incurred by such person in any such capacity, or arising
out of such person's status as such, and related expenses, whether or not the
Corporation would have the power to indemnify such person against such
liability under the provisions of the Delaware General Corporation Law.
-15-
60
7. GENERAL PROVISIONS
7.1 INSPECTION OF BOOKS AND RECORDS
Subject to any additional conditions or limitations set forth in
the Stockholders' Agreement, any stockholder, in person or by attorney or other
agent, shall, upon written demand under oath stating the purpose thereof, have
the right during the usual hours for business to inspect for any proper purpose
the Corporation's stock ledger, a list of its stockholders, and its other books
and records, and to make copies or extracts therefrom. A proper purpose shall
mean a purpose reasonably related to such person's interest as a stockholder.
In every instance where an attorney or other agent shall be the person who
seeks the right to inspection, the demand under oath shall be accompanied by a
power of attorney or such other writing which authorizes the attorney or other
agent to so act on behalf of the stockholder. The demand under oath shall be
directed to the Corporation at its registered office or at its principal place
of business.
7.2 DIVIDENDS
The Board of Directors may declare dividends upon the capital stock
of the Corporation, subject to the provisions of the Certificate of
Incorporation and the laws of the State of Delaware.
7.3 RESERVES
The directors of the Corporation may set apart, out of the funds of
the Corporation available for dividends, a reserve or reserves for any proper
purpose and may abolish any such reserve.
7.4 EXECUTION OF INSTRUMENTS
All checks, drafts or other orders for the payment of money, and
promissory notes of the Corporation shall be signed by such officer or officers
or such other person or persons as the Board of Directors may from time to time
designate.
7.5 FISCAL YEAR
The fiscal year of the Corporation shall be fixed by resolution of
the Board of Directors.
-16-
61
7.6. SEAL
The corporate seal shall be in such form as the Board of Directors
shall approve. The seal may be used by causing it or a facsimile thereof to be
impressed or affixed or otherwise reproduced.
The foregoing Bylaws were adopted by the Board of Directors on
___________, 199__.
-17-
62
EXHIBIT D
XXXX OF SALE
THIS XXXX OF SALE (the "XXXX OF SALE") is executed and delivered effective
this _______ day of _________ 199__, by Intracel Corporation, a Delaware
corporation ("SELLER"), to Intracel Cancer Center of Pennsylvania, Inc., a
Delaware corporation ("BUYER").
WHEREAS, Seller and Buyer have entered into a Subscription Agreement,
pursuant to which, among other things, Seller has agreed to contribute the
assets described in Exhibit A attached hereto and incorporated by reference
herein (the "ASSETS") in exchange for 1,900 shares of common stock par value
$.01 per share (the "COMMON STOCK"), of Buyer; and
WHEREAS, the parties hereto desire by this Xxxx of Sale for Seller to
sell, assign, transfer and convey to Buyer the Assets in exchange for the
shares of Common Stock to be issued to Seller pursuant to the Subscription
Agreement.
NOW, THEREFORE, for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties agree as follows:
1. Seller hereby grants, bargains, sells, delivers, transfers, sets
over, assigns and conveys to Buyer and its successors and assigns, free and
clear of any and all liens, claims or encumbrances of any kind, except for the
security interest in the assets granted by Seller to Lehigh Valley Hospital and
Health Network ("LEHIGH") pursuant to that certain Security Agreement of even
date herewith, by and among Seller and Lehigh attached hereto as Exhibit B (the
"SECURITY AGREEMENT"), in the Assets in exchange for a total of 1,900 shares of
Common Stock. The parties agree that the Common Stock to be issued to Seller
reflects the fair market value of the Assets.
2. Seller, for itself and its successors and assigns, covenants to and
agrees with Buyer to warrant and defend the sale, transfer, assignment,
conveyance and delivery of the Assets unto Buyer and its successors and
assigns, against all lawful claims and demands arising from Seller's ownership
of the Assets prior to the date hereof.
63
3. Seller hereby covenants to and agrees with Buyer that it will duly
execute and deliver any other documents necessary to effect the transfer of the
Assets.
4. Buyer, for itself and its successor and assigns, covenants to
and agrees with Seller, to take all actions necessary to allow Seller to comply
with its obligations under the Security Agreement.
5. All of the terms and provisions of this Xxxx of Sale shall be
binding upon Seller and its respective successors and assigns, and shall inure
to the benefit of Buyer and its successors and assigns.
6. This Agreement shall be governed by, and construed in accordance
with, the internal laws of the State of Maryland, excluding choice of law rules.
7. This Agreement may be executed in counterparts, each of which
shall be deemed an original and all of which shall be deemed one and the same
instrument.
IN WITNESS WHEREOF, Seller and Buyer have caused the due execution
and delivery of this Xxxx of Sale as of the day and year first written above.
INTRACEL CANCER CENTER OF
PENNSYLVANIA, INC.
By: __________________________
Name: ________________________
Title: _______________________
INTRACEL CORPORATION
By: __________________________
Name: ________________________
Title: _______________________
2
64
EXHIBIT E
INTRACEL CANCER CENTER OF PENNSYLVANIA, INC.
____________
SUBSCRIPTION AGREEMENT
____________
_____________, 1998
65
TABLE OF CONTENTS
Page
----
1. SUBSCRIPTION FOR AND PURCHASE OF STOCK............................. 1
2. REPRESENTATIONS, WARRANTIES AND COVENANTS OF SUBSCRIBER............ 1
2.1 Accredited Investor Status............................... 2
2.2 Non-Registration of Shares............................... 2
2.3 Purchase for Investment Only............................. 2
2.4 Ability to Evaluate Investment and Bear Economic Risk.... 2
2.5 Familiarity with Business................................ 3
2.6 Restricted Securities; Rule 144.......................... 3
2.7 Legend on Shares......................................... 3
2.8 Authorization; Enforceability............................ 4
2.9 Brokers and Finders...................................... 4
3. MISCELLANEOUS...................................................... 4
66
INTRACEL CANCER CENTER OF PENNSYLVANIA, INC.
SUBSCRIPTION AGREEMENT
THIS SUBSCRIPTION AGREEMENT (this "AGREEMENT") is made and entered into as
of _______________, 199__ by and between Intracel Cancer Center of
Pennsylvania, Inc., a Delaware corporation (the "COMPANY"), and Lehigh Valley
Hospital and Health Network, a Pennsylvania non-profit corporation (the
"SUBSCRIBER").
WHEREAS, Subscriber desires to subscribe for and purchase, and the Company
desires to issue and sell, the shares of common stock of the Company, par value
$.01 per share (the "COMMON STOCK"), described in Section 1 below, all upon the
terms and conditions set forth in this Agreement.
NOW THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements hereinafter set forth, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto hereby agree as follows:
1. SUBSCRIPTION FOR AND PURCHASE OF STOCK
Subject to the terms and conditions hereof, Subscriber hereby subscribes
for and agrees to purchase, and the Company hereby agrees to issue and sell to
Subscriber, 100 shares of Common Stock (the "SHARES") at an aggregate purchase
price equal to $36,842 (the "PURCHASE PRICE"). Simultaneously with the
execution and delivery of this Agreement.
(a) Subscriber shall deliver to the Company, against delivery of a
certificate representing the Shares, payment of the Purchase Price in
the form of a check payable to the order of the Company or in such
other form as the Company may reasonably request; and
(b) the Company shall deliver to Subscriber, against delivery of the
Purchase Price, a duly issued stock certificate made out in
Subscriber's name and representing the Shares.
2. REPRESENTATIONS, WARRANTIES AND COVENANTS OF SUBSCRIBER
In order to induce the Company to enter into this Agreement, Subscriber
makes the following representations, warranties and covenants, each of which is
material to and is being relied upon by the Company.
67
2.1 ACCREDITED INVESTOR STATUS
Subscriber is an "accredited investor" as such term is defined in
Rule 501 under the Securities Act of 1933, as amended (the "SECURITIES ACT") as
of the date of the purchase of the Shares.
2.2 NON-REGISTRATION OF SHARES.
Subscriber understands that the Shares to be purchased by the
Subscriber under this Agreement have not been registered under the Securities
Act, or any applicable state securities laws, in reliance upon exemptions
contained in the Securities Act and applicable state securities laws and any
applicable regulations promulgated thereunder or interpretations thereof, and
cannot be offered for sale, sold or otherwise transferred unless such Shares
are subsequently so registered or qualify for exemption from registration under
the Securities Act and applicable state securities laws; that the certificates
representing such Shares shall bear a legend substantially in the form set
forth in Section 2.7 below; and that any transfer agent now or hereafter
employed or utilized by the Company shall be instructed not to effect any
transfer of the Shares without prior written authorization from the Company
(or, if the Company serves as its own transfer agent, a notation shall be made
in the Company's records indicating the transfer restrictions to which the
Shares are subject), which authorization may not be unreasonably withheld or
delayed.
2.3 PURCHASE FOR INVESTMENT ONLY.
The Shares are being acquired under this Agreement by Subscriber
solely for its own account, for investment and not with a view toward resale or
other distribution within the meaning of the Securities Act; and the Shares
will not be offered for sale, sold or otherwise transferred without either
registration or exemption from registration under the Securities Act and
applicable state securities laws.
2.4 ABILITY TO EVALUATE INVESTMENT AND BEAR ECONOMIC RISK.
Subscriber has such knowledge and experience in financial and
business matters that it is capable of evaluating the merits and risks of its
investment in the Shares; and Subscriber understands and is able to bear any
economic risks associated with such investment (including the necessity of
holding the Shares for an indefinite period of time, inasmuch as the Shares
have not been registered under the Securities Act and any applicable state
securities laws).
2
68
2.5 FAMILIARITY WITH BUSINESS.
Subscriber is familiar with the business and financial affairs of
the Company and has been given the opportunity to ask questions of, and receive
answers from, the principal officers of the Company; and Subscriber has had
further opportunity to obtain any additional information necessary or desirable
to verify the accuracy of the foregoing information. In evaluating the
suitability of an investment in the Shares, Subscriber confirms that it has not
relied upon any representations or other information (whether oral or written)
other than as set forth herein or in the documents furnished to it by the
Company.
2.6 RESTRICTED SECURITIES; RULE 144.
Subscriber understands that the Shares will be considered
"restricted securities" within the meaning of Rule 144 under the Securities
Act; that Rule 144 may not be available to exempt from the registration
requirements of the Securities Act the sale of such "restricted securities";
that if Rule 144 is available, sales may be made in reliance upon Rule 144 only
in accordance with the terms and conditions of Rule 144, which among other
things generally requires that the Shares be held for at least one year and
that sales be made in limited amounts; and that, if an exemption for such sales
by such Subscriber is not available, registration of the Shares may be
required, but that the Company is under no obligation to register the Shares or
to facilitate compliance or to comply with any exemption.
2.7 LEGEND ON SHARES.
The certificate representing the Shares to be sold to Subscriber
pursuant to this Agreement shall bear a legend in substantially the following
form:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"),
OR STATE SECURITIES LAWS AND CANNOT BE OFFERED FOR SALE, SOLD OR
OTHERWISE TRANSFERRED IN THE ABSENCE OF REGISTRATION OR THE
AVAILABILITY OF AN EXEMPTION FROM REGISTRATION UNDER THE ACT AND
REGULATIONS PROMULGATED THEREUNDER AND APPLICABLE STATE SECURITIES
LAWS. THE OWNER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE
AGREES NOT TO SELL THE SECURITIES FOR A PERIOD OF 1 YR AFTER [THE
DATE OF THE SECURITIES]
THE TRANSFER, SALE OR OTHER DISPOSITION OF THE SECURITIES REPRESENTED
BY THIS CERTIFICATE IS RESTRICTED BY AND SUBJECT TO THE PROVISIONS OF
A
3
69
STOCKHOLDERS' AGREEMENT, DATED AS OF ___________ __, 199_, AS
AMENDED AND MODIFIED FROM TIME TO TIME, AMONG THE ISSUER OF SUCH
SECURITIES (THE "COMPANY") AND CERTAIN OF THE COMPANY'S
STOCKHOLDERS. A COPY OF SUCH STOCKHOLDERS' AGREEMENT AND ANY AND ALL
AMENDMENTS THERETO SHALL BE FURNISHED WITHOUT CHARGE BY THE COMPANY
TO THE HOLDER HEREOF UPON WRITTEN REQUEST AND IS ALSO AVAILABLE FOR
INSPECTION AND EXAMINATION AT THE OFFICES OF THE COMPANY."
2.8 AUTHORIZATION; ENFORCEABILITY.
Subscriber has the capacity to execute and deliver this Agreement
and, subject to fulfillment or waiver (to the extent legally permitted) of
conditions precedent to such Subscriber's obligations hereunder, to carry out
its obligations hereunder. This Agreement constitutes a valid and legally
binding obligation of Subscriber enforceable in accordance with its terms,
except (a) as such enforcement may be limited by bankruptcy, reorganization,
insolvency, or other laws and court decisions relating to or affecting the
enforcement of creditors' rights generally (including, but not limited to,
statutory or other law regarding fraudulent transfers), and (b) as to the
availability of specific performance or other equitable remedies or subject to
principles of public policy.
2.9 BROKERS AND FINDERS
Subscriber confirms that it has not employed any broker or finder
or incurred any liability for any brokerage fees, commissions, or finders' fees
in connection with the transactions contemplated herein.
3. MISCELLANEOUS
No amendment or modification of this Agreement shall be valid or
binding unless set forth in writing and duly executed by the party against whom
enforcement of the amendment or modification is sought. No delay or failure to
exercise any right, power or remedy under this Agreement or enforcing any
provision of this Agreement shall be construed as a waiver of such provision or
a waiver of any default or acquiescence in such default or affect the right of
the Company to enforce each and every provision of this Agreement in accordance
with its terms. Any notice required to be given under this Agreement shall be
in writing and shall be hand delivered (including delivery by courier), sent by
Federal Express or by other recognized overnight delivery service, mailed by
first-class, registered or certified mail, return receipt requested, postage
prepaid, or sent by facsimile
4
70
transmission, to the parties at the addresses or facsimile numbers set forth
below their respective signatures below. This Agreement shall be governed by
and construed in accordance with the laws of the State of Delaware (excluding
the choice of law rules thereof). This Agreement constitutes the entire
Agreement between the parties hereto with respect to the subject matter hereof.
This Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective successors and assigns. This Agreement may
be executed in counterparts.
* * * * *
IN WITNESS WHEREOF, each of the parties has duly caused this
Agreement to be duly executed in its name and on it behalf, as of the date
first written above.
COMPANY:
INTRACEL CANCER CENTER OF
PENNSYLVANIA, INC.
By:_____________________________
Name:___________________________
Title:__________________________
Address:________________________
________________________
________________________
Fax No._________________________
SUBSCRIBER:
LEHIGH VALLEY HOSPITAL AND HEALTH
NETWORK
By:_____________________________
Name:___________________________
Title:__________________________
Address:________________________
________________________
________________________
Fax No._________________________
5
71
EXHIBIT F
INTRACEL CANCER CENTER OF PENNSYLVANIA, INC.
STOCKHOLDERS' AGREEMENT
THIS STOCKHOLDERS' AGREEMENT (this "Agreement") is entered into
as of ____________ ___, 19__ by and between Intracel Cancer Center of
Pennsylvania, inc., a Delaware corporation (the "Corporation"), and the
stockholders of the Corporation as listed on Exhibit A attached hereto (the
stockholders listed on Exhibit A are hereinafter referred to collectively as
"Stockholders" and individually as a "Stockholder").
WHEREAS, the Stockholders have formed a Delaware corporation
known as "Intracel Cancer Center of Pennsylvania, Inc." to own and operate a
center to manufacture OncoVaxcl(r) and other oncological products as agreed to
by the Stockholders and to provide such products to cancer patients;
WHEREAS, the Stockholders have purchased and are the holders of
record of the shares of capital stock of the Corporation set forth opposite
their name on Exhibit A hereto; and
WHEREAS, the Stockholders desire to set forth in this Agreement
(i) the terms and conditions upon which they would capitalize the Corporation
and manage its business and affairs and (ii) restrictions on the issuance and
transfer of capital stock of the Corporation.
NOW THEREFORE, in consideration of the foregoing, of the mutual
promises hereinafter set forth, and of other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties
hereto, intending to be legally bound, hereby agree as follows:
1. PURPOSES AND SCOPE
The Corporation has been organized for, among other lawful
purposes, the purpose of owning and operating a center known as the "OncoVax
Center" which shall manufacture OncoVaxCL(R) and other oncological products as
agreed to by the Stockholders and provide such products to cancer patients.
72
2. CAPITALIZATION
2.1. CAPITAL STRUCTURE.
As stated in the Certificate of Incorporation of the
Corporation, the Corporation initially shall have authorized capital stock
consisting of Three Thousand (3,000) shares of common stock, par value $.01 per
share (the "Common Stock").
2.2. INITIAL SUBSCRIPTIONS FOR STOCK.
Intracel Corporation ("Intracel") and Lehigh Valley Hospital and
Health Network ("Lehigh") have each purchased the number of shares of Common
Stock set forth below under the terms of a Joint Venture Agreement dated as of
December 11, 1998 (the "Joint Venture Agreement") and pursuant to Subscription
Agreements each dated as of _________ ___, 1998.
Number of Purchase
Stockholder Shares Purchased Price
----------- ---------------- -----
Intracel Corporation 1,900 $700,000
Lehigh Valley Hospital 100 $ 36,843
and Health Network
2.3. ADDITIONAL CONTRIBUTIONS TO CAPITAL.
2.3(a) Capital Contributions. The Stockholders shall have no
obligation to make additional contributions to the capital of the Corporation
except at such times, and in such amounts, as may be set forth in the Initial
Funding Schedule attached hereto as Exhibit C, as amended from time to time, and
as otherwise may be agreed upon by a Supermajority Vote (as defined in Section
10 below) of the Board of Directors and the Stockholders in accordance with
Section 4 below.
2.3(b) Loans and Advances. The Stockholders may make loans or
other advances to the Corporation in such amounts and at such rates of interest,
if any, as may be agreed upon by a Supermajority Vote of the Board of Directors;
provided, however, that the Stockholders need not obtain a Supermajority Vote
approval from the Board Director's for loans made to the Corporation on
commercially reasonable terms comparable to terms available to the Corporation
from commercial lending sources. Any such loans or advances shall be a debt of
the
- 2 -
73
Corporation to the lending Stockholders and shall not be regarded as
contributions to the capital of the Corporation.
2.4. LEGEND.
Each certificate representing shares of Capital Stock (as
defined in Section 9 below) shall bear a legend in substantially the following
form as consistent with the terms of this Agreement and applicable law:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"ACT"), OR STATE SECURITIES LAWS AND CANNOT BE OFFERED FOR SALE,
SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF REGISTRATION OR
THE AVAILABILITY OF AN EXEMPTION FROM REGISTRATION UNDER THE ACT
AND REGULATIONS PROMULGATED THEREUNDER AND APPLICABLE STATE
SECURITIES LAWS. THE OWNER OF THE SECURITIES REPRESENTED BY THIS
CERTIFICATE AGREES NOT TO SELL THE SECURITIES FOR A PERIOD OF 1
YR AFTER [THE DATE OF THE SECURITIES]
THE TRANSFER, SALE OR OTHER DISPOSITION OF THE SECURITIES
REPRESENTED BY THIS CERTIFICATE IS RESTRICTED BY AND SUBJECT TO
THE PROVISIONS OF A STOCKHOLDERS' AGREEMENT, DATED AS OF
_________ __, 199_, AS AMENDED AND MODIFIED FROM TIME TO TIME,
AMONG THE ISSUER OF SUCH SECURITIES (THE "COMPANY") AND CERTAIN
OF THE COMPANY'S STOCKHOLDERS. A COPY OF SUCH STOCKHOLDERS'
AGREEMENT AND ANY AND ALL AMENDMENTS THERETO SHALL BE FURNISHED
WITHOUT CHARGE BY THE COMPANY TO THE HOLDER HEREOF UPON WRITTEN
REQUEST AND IS ALSO AVAILABLE FOR INSPECTION AND EXAMINATION AT
THE OFFICES OF THE COMPANY.
- 3 -
74
3. CORPORATE GOVERNANCE; EXCLUSIVITY
3.1. BOARD OF DIRECTORS.
3.1(a) Composition of Board of Directors. The Board of Directors
shall be composed of directors designated by the Stockholders as more
specifically set forth in Exhibit B.
3.1(b) Stockholder Covenants. The Corporation and each
Stockholder (for so long as such Stockholder owns any Capital Stock) shall take
or cause to be taken all such actions within their respective power and
authority as may be required to:
(i) establish and maintain the authorized size of the Board of
Directors of the Corporation at the number of directors set
forth in Exhibit B attached hereto;
(ii) maintain the quorum requirements for actions of the Board
of Directors at the number of directors set forth in Exhibit B
attached hereto;
(iii) maintain the voting requirements for actions of the Board
of Directors at a majority of directors present at a meeting at
which there is a quorum, except with respect to (A) such matters
as the Certificate of Incorporation, the Bylaws, or applicable
provisions of the Delaware General Corporation Law impose a
greater voting requirement or (B) such matters as require action
by a Supermajority Vote of the Board of Directors in accordance
with Section 3.2;
(iv) cause to be elected to the Board of Directors the directors
designated by the Stockholders (the "Designated Directors") as
set forth in Exhibit B hereto or as otherwise instructed in
writing by the Stockholder entitled to designate a director
pursuant to this Agreement;
(v) remove forthwith any director when (and only when) such
removal is requested in writing for any reason, with or without
cause, by the Stockholder that designated such director; and
(vi) in the case of a vacancy caused by the death, resignation
or removal (as herein provided) of any director, to elect a
director
- 4 -
75
designated by the Stockholder entitled to fill the vacant
director position.
3.2. ACTIONS REQUIRING A SUPERMAJORITY VOTE OF BOARD OF DIRECTORS.
In addition to any vote required by law, the Certificate of
Incorporation, or the Bylaws of the Corporation, a Supermajority Vote (as
defined in Section 9 below and Exhibit B hereto) of the Board of Directors shall
be required for the Corporation to:
(a) Materially change the Corporation's principal business of
manufacturing OncoVaxCL(R) and other oncological products and
providing such products to cancer patients;
(b) Change or modify the authorized size of the Board of
Directors of the Corporation as set forth in Exhibit B attached
hereto;
(c) Enter into or materially amend any contract between the
Corporation and any of its Affiliates (including the
Stockholders and their respective Affiliates);
(d) Require any Stockholder to make any additional capital
contribution in excess of the consideration paid or payable for
Capital Stock purchased by such Stockholders and any amounts set
forth in the Funding Schedule attached hereto as Exhibit C;
(e) Adopt the Corporation's (i) business plan and any amendments
thereto or (ii) annual budget and plan and any material
revisions thereto or deviation therefrom;
(f) Incur indebtedness from any Stockholder, except as provided
in Section 2.3(b) above; or
(g) Incur or assume any other indebtedness in a single
transaction or in the aggregate in excess of $250,000.
3.3. SPECIAL APPROVAL RIGHT.
Notwithstanding any provision herein to the contrary, any
proposed action or transaction of the Corporation which Lehigh determines, in
its reasonable discretion, is reasonably likely to (i) have an adverse effect on
Lehigh's qualification as a tax-exempt charity or (ii) result in the receipt by
Lehigh of a material amount of "unrelated business taxable income" for federal
income tax purposes, must be approved by Lehigh in advance. Lehigh hereby
acknowledges and agrees that the execution, delivery and the terms of this
Agreement and that certain Joint Venture Agreement dated as of December 11,
1998, by and between Lehigh and Intracel (the "Joint Venture Agreement"), as
well as each of the exhibits to the Joint Venture
- 5 -
76
Agreement have already been approved by Lehigh prior to the execution and
delivery of this Agreement, and that the terms of this Section 3.3 do not apply
to the execution, delivery and performance of this Agreement, the Joint Venture
Agreement, and the exhibits to the Joint Venture Agreement.
3.4. DIVIDENDS.
Dividends, if any, shall be payable only in the manner and to
the extent permitted by law and in the sole and absolute discretion of the Board
of Directors of the Corporation. Any distribution of dividends to Stockholders
shall be made in proportion to their relative ownership interests in the
Corporation.
3.5. OPERATIONS AS INDEPENDENT COMPANIES; INTERESTED DIRECTOR
TRANSACTIONS.
3.5(a) Independent Companies. The business and financial affairs
of the Corporation shall be conducted in a manner consistent with the operation
of a separate and distinct corporation independent of its corporate
Stockholders. Nothing in this Agreement shall be construed so as to constitute
the Stockholders as partners or as agents of each other, or in any other manner
other than as separate and distinct corporations. Each Stockholder shall
compensate and reimburse the Corporation for the fair market value of any goods
or services received from the Corporation. The Corporation shall reimburse and
compensate each Stockholder for the fair market value of goods and services
provided by the Stockholder to the Corporation; provided, however, that no
Stockholder shall be entitled to such reimbursement or compensation unless such
reimbursement or compensation or the agreement under which such reimbursement or
compensation is to be paid or provided has been approved by the Board of
Directors of the Corporation.
3.5(b) Interested Director Transactions. In addition to any
requirements set forth in the Certificate of Incorporation, the Bylaws, or this
Agreement, any transaction between the Corporation and any director of the
Corporation or between the Corporation and any other corporation, firm, or
entity of which a director of the Corporation (the "Interested Director") is the
designee on the Board of Directors as contemplated in Section 3.1(a) above or
of which he/she is a director or in which he/she has a material financial
interest, shall be subject to the following:
(i) the Interested Director(s) must disclose his/her/their
common directorship or material financial interest to
the Board of Directors; and
- 6 -
77
(ii) the transaction must be approved by the affirmative vote
of a majority, or by a Supermajority Vote if required by
Section 3.2, of the directors other than the Interested
Director(s) (the "Disinterested Directors"). For
purposes of this Section 3.5(b), a Supermajority Vote of
the Disinterested Directors shall mean the affirmative
vote of at least 80% of the Disinterested Directors
rounded up to the nearest whole number.
3.6. BOOKS AND RECORDS; AUDIT.
Financial and all other books and records of the Corporation
shall be maintained at the principal office of the Corporation. In addition to
any right provided by law (including the Delaware General Corporation Law), each
Stockholder, upon reasonable notice and during normal business hours, shall have
the right to inspect the financial and all other records of the Corporation and
to make copies thereof; provided, however, that such access shall be subject to
the confidentiality and non-disclosure obligations in Section 10.4 below and,
notwithstanding any other provision herein, no Stockholder shall have access to
competitive information relating to any other Stockholder or any entity
affiliated therewith. Following the close of the fiscal year of the Corporation,
the financial books and records of the Corporation shall be audited by an
independent accounting firm selected and approved by the Board of Directors of
the Corporation. The financial statements examined by the Corporation's
independent auditors shall be final and binding upon all Stockholders.
3.7. FISCAL YEAR.
The Corporation shall conduct its financial affairs and shall
prepare federal and state tax returns on the basis of a fiscal year ending June
30, unless otherwise required by law.
4. RESTRICTIONS ON TRANSFER OF SHARES
4.1. TRANSFER SUBJECT TO RIGHTS OF CORPORATION AND STOCKHOLDERS.
Except as set forth in Section 4.9 below, no Stockholder shall
directly or indirectly transfer any Capital Stock to any person or entity
without the written consent of all of the other Stockholders (such parties,
together with the Corporation, hereinafter referred to individually as an
"Offeree" and collectively as the "Offerees"), unless the party desiring to make
such transfer (the "Transferor") shall have first made the Offer required by
this Section 4, and such Offer shall not have been accepted as provided in this
Section 4. Any purported transfer contrary to the terms of this Section 4 shall
be null and void and of no force and effect.
- 7 -
78
4.2. TRANSFER.
The term "transfer" as used in this Section 4 shall include a
sale, gift, mortgage, pledge, exchange, assignment, or other disposition,
whether or not for value, including a disposition under judicial order, legal
process, execution, attachment, or enforcement of an encumbrance, whether
resulting from bankruptcy, dissolution, insolvency, or otherwise but shall not
include a Change of Control (as defined in Section 9 below) of any Stockholder
or a pledge or mortgage in connection with a Stockholder financing where the
mortgagee or pledgee may not exercise voting or other rights associated with the
Capital Stock.
4.3. OFFER.
Except as provided in Section 4.9, the Transferor shall, prior
to transferring any or all of its Capital Stock, make to the Corporation and the
other Offerees an offer in writing to sell the Capital Stock proposed to be
transferred by the Transferor (the "Offer"). Attached to the Offer, which shall
be sent to the Corporation, shall be a statement of intention to transfer, and
the specific terms and conditions of the proposed transfer, including, but not
limited to, (i) the names and addresses of not more than five person(s) or
entity(ies) that the Transferor in good faith believes to be bona fide
prospective transferees, (ii) the number of shares of Capital Stock involved in
the proposed transfer, (iii) all of the terms of such transfer (which must
include a cash price unless a bona fide offer has been made to the Transferor
which consists partly or wholly of consideration other than cash), including the
terms and conditions of any bona fide offer made to the Transferor and a copy of
any such offer which is in writing, and (iv) the address of the Transferor to
which notice or acceptance of the Offer is to be sent. The Corporation reserves
the right to make reasonable requests for information regarding any proposed
transferee identified by the Transferor and the First Offer Period described in
Section 4.4(a) below shall not begin until such information has been received by
the Corporation and the Corporation has made a good faith determination that the
transferee(s) are reasonably qualified to comply with the covenants and
agreements contained in this Agreement; provided, that the Transferor may
require the Corporation to maintain the identity of the proposed transferee and
all such information confidential.
4.4. ACCEPTANCE.
(a) First Offer Period. Within 30 days after the Corporation's
receipt of the Offer (the "First Offer Period"), the Corporation
shall notify the Transferor whether or not it desires to
purchase any of the Capital Stock offered and how many of the
shares of
- 8 -
79
Capital Stock it desires to purchase. If a purchase by
the Corporation of all of the shares of Capital Stock offered is
intended, the notice shall fix a closing date not more than 30
days after the expiration of the First Offer Period.
(b) Second Offer Period. Should the Corporation determine to
purchase all of the shares of Capital Stock offered, it shall
promptly notify the other Offerees that it has made such
determination. Should the Corporation determine to purchase none
or less than all of the shares of Capital Stock offered, it
shall promptly communicate the Offer for the remaining shares of
Capital Stock to the other Offerees, which shall have 20 days
from the date of receipt of such notice (the "Second Offer
Period") within which to notify the Corporation whether or not
they intend to purchase any of the shares of Capital Stock
offered and how many of the shares of Capital Stock they desire
to purchase. The Corporation shall in turn promptly notify the
Transferor of any intended purchases by the other Offerees.
(c) Closing. The closing date of any such purchases hereunder by
such Offerees shall be no later than 30 days after the
expiration of the Second Offer Period. Any shares of Capital
Stock purchased by the participating Offerees (other than the
Corporation) shall be purchased in proportion to their holdings,
or in such other proportions as they may agree. The phrase "in
proportion to their holdings" as used in this Section 4.4 shall
mean in the proportion which the combined voting power of the
shares of Capital Stock held by each Offeree bears to the
aggregate voting power of the shares of Capital Stock held by
all the participating Offerees (other than the Corporation) at
the time when the formula is being applied; provided, however,
that any shares of Capital Stock which any Offeree has a right
to purchase under this Section 4.4 but declines to purchase may
be purchased by the remaining Offerees (if purchased in the
manner and within the time periods prescribed herein).
(d) Assignment of Rights. The Corporation or any other Offeree
may assign its rights to purchase Capital Stock pursuant to any
Offer made hereunder to (i) any stockholder of such Offeree,
(ii) any employee benefit plan (within the meaning of Section
3(3) of the Employee Retirement Income Security Act of 1974, as
amended) maintained by the Corporation or such other Offeree or
any Subsidiary or Affiliate, or (iii) any Affiliate of the
Corporation or such Offeree. The Corporation or any other
Offeree shall give reasonable written notice to the Transferor
and all other Offerees of any assignment of its rights as
permitted hereunder.
- 9 -
80
4.5. SPECIFIED MINIMUM PURCHASE.
Notwithstanding the foregoing, if the Transferor has received a
bona fide written offer from a prospective purchaser of its shares of Capital
Stock, but a condition of such offer is that such prospective purchaser will not
purchase less than the total, or a specified minimum, number of shares of
Capital Stock owned by the Transferor at the time of the bona fide written
offer, then in order to exercise the foregoing rights of first refusal the
Corporation and the other Offerees must purchase, in the aggregate, either (i)
all of the shares of Capital Stock offered by the Transferor, or (ii) no less
than that number of shares of Capital Stock which, when deducted from the total
number of shares of Capital Stock being offered by the Transferor, results in
the minimum number of shares of Capital Stock specified in the bona fide written
offer from such prospective purchaser remaining available for sale by the
Transferor to such prospective purchaser. Otherwise, the Offer shall be deemed
to have been completely rejected by the Corporation and the other Offerees.
4.6. PURCHASE PRICE.
The purchase price for each share of Capital Stock purchased
from the Transferor by the Corporation or the other Offerees shall be (i) the
same as, and on the same terms and conditions as, specified in the bona fide
offer received by the Transferor from a prospective transferee of some or all of
its Capital Stock, if such an offer has been received by the Transferor, or (ii)
the price in cash specified by the Transferor in the Offer. The purchase price
shall be payable in cash. In the event that a bona fide offer to purchase
Capital Stock received by the Transferor specifies the payment of consideration
other than cash, the purchase price for purposes of this Section 4.6 shall be
the cash equivalent of such consideration, determined on a per share basis by
the Board of Directors of the Corporation in good faith.
4.7. RELEASE OF TRANSFEROR FROM RESTRICTIONS.
If the Corporation and the other Offerees shall fail to purchase
all of the Capital Stock offered by the Transferor pursuant to the terms of this
Section 4, the Transferor shall be free for a period of 90 days to sell the
offered but unsold shares of Capital Stock to (i) the prospective transferee who
has made a bona fide offer to the Transferor, for the price and on the terms of
such offer, or (ii) one or more of the prospective transferees identified in the
Offer, if the Transferor has not received a bona fide offer from a prospective
transferee, for a price and on terms no more favorable to such transferee(s)
than were available to the Corporation and the other Offerees under the Offer.
Any such sale also shall be subject to the other provisions of this Section 4,
including Section 4.10 below. If the offered but unsold shares of Capital Stock
are not so sold by the Transferor within the specified 90-day period, all of the
Transferor's rights with respect to transfer of the Capital Stock
- 10 -
81
without again complying with the restrictions contained in this Section 4 shall
terminate.
4.8. TERMINATION OF RIGHTS AND OBLIGATIONS.
The rights and obligations of the parties under this Section 4
shall irrevocably terminate on the occurrence of any of the following events:
(i) the voluntary or involuntary dissolution of the Corporation; (ii) the
receipt by the Corporation from the SEC of an order of effectiveness as to any
registration statement relating to an Initial Public Offering (as defined in
Section 9 below) that is subsequently consummated; (iii) the termination of this
Agreement pursuant to Section 7.2 below; or (iv) an acquisition, consolidation,
or merger of the Corporation into or with another corporation that results in
the Stockholders owning publicly-traded securities.
4.9. TRANSFERS TO AFFILIATE.
Each Stockholder may transfer some or all of its shares of
Capital Stock to an Affiliate (as defined in Section 9 below) thereof without
such transfer being subject to Sections 4.3-4.7 above. Prompt written notice of
any such transfer shall be delivered to the Corporation and the other
Stockholder(s). From and after any such transfer, the Affiliate to which such
shares are transferred shall enjoy the respective rights of the transferring
Stockholder, and be subject to the respective restrictions imposed on such
Stockholder under this Agreement but the transferring Stockholder shall not be
relieved of any of its obligations hereunder and shall remain a party for all
purposes hereof.
4.10. AGREEMENTS BINDING UPON TRANSFEREES.
In the event that, at any time or from time to time, any shares
of Capital Stock are transferred in compliance with the terms of this Agreement
to any party, other than the Corporation, the transferee shall take such shares
of Capital Stock pursuant to all provisions, conditions, and covenants of this
Agreement, and, to the extent applicable, the Joint Venture Agreement and the
exhibits thereto, and, as a condition precedent to the transfer of such shares
of Capital Stock, the transferee shall agree in writing to be bound by all
provisions of this Agreement and all other applicable agreements by executing
and delivering a counterpart of this Agreement and all other applicable
agreements whereupon such transferee shall become a party hereto and thereto. In
the event that there shall be any transfer to any person or entity pursuant to
any provision of this Agreement and in compliance with the terms of this
Agreement all references herein to the Stockholders or to a Stockholder shall be
deemed to include such transferee, and the provisions of this Agreement shall
thereafter be binding upon such transferee.
- 11 -
82
4.11. STOCK TRANSFER RECORD.
The Corporation shall keep a stock transfer book in which shall
be recorded the name and address of each Stockholder of the Corporation. No
transfer or issuance of any shares of Capital Stock shall be effective or valid
unless and until recorded in the stock transfer book. The Corporation shall not
record any transfer or issuance of shares of Capital Stock in the stock transfer
book unless the transfer or issuance is in strict compliance with all provisions
of this Agreement. Each Stockholder agrees that, in the event such Stockholder
desires to make a transfer within the provisions hereof, such Stockholder shall
furnish to the Corporation such evidence of compliance with this Agreement as
may be reasonably be required by the Board of Directors of the Corporation.
5. PARTICIPATION IN CERTAIN ACQUISITION OFFERS
5.1. OBLIGATION TO OFFER.
In the event any Stockholder or Stockholders receive a bona fide
offer or related series of offers from any person (the "Control Offeror") to
purchase from such Stockholder(s) not less than 50%, by voting power, of the
then outstanding Capital Stock (a "Majority Interest") or to purchase from such
Stockholder(s) that number of shares of stock which, when added to the number of
shares of stock at the time already owned, directly or indirectly, by the
Control Offeror and its Affiliates constitutes a Majority Interest (a "Control
Offer"), such Stockholder(s) shall promptly forward a copy of such Control Offer
to the Corporation and the other Stockholders. The Stockholder(s) to whom the
Control Offer has been made shall not sell any such Capital Stock to the Control
Offeror unless (a) the Control Offer is extended to the other Stockholders and
(b) if the Control Offer, as extended, relates to less than all of the Capital
Stock owned by the other Stockholders, each Stockholder shall be entitled to
sell to the Control Offeror pursuant to the Control Offer, and the Control
Offeror shall agree to purchase from each Stockholder, a proportionate share of
the aggregate number of shares of Capital Stock as to which the Control Offer
relates. For the purposes of this Section 5.1, a Stockholder's proportionate
share of Capital Stock shall be the product of (i) the number of shares of
Capital Stock to which such Control Offer relates times (ii) the ratio that the
number of shares of Capital Stock owned by such Stockholder bears to the number
of shares of Capital Stock owned by all Stockholders electing to sell to the
Control Offeror. Notwithstanding anything contained in this Section 5.1, no
Stockholder shall
- 12 -
83
sell any Capital Stock to a Control Offeror unless and until the provisions of
Section 4 hereof have been complied with.
5.2. OBLIGATION TO SELL.
In the event that the Corporation has received a proposal for
any merger, sale of a significant portion of the Corporation's assets,
recapitalization, sale of more than a majority by voting power of all of the
Capital Stock, or other extraordinary transaction (an "Acquisition Offer"), or
any Stockholder has received a Control Offer, and (a) the Board of Directors of
the Corporation has recommended by at least a Supermajority Vote such
Acquisition Offer or Control Offer to the Stockholders or (b) Stockholders
owning more than 80% by voting power of the Capital Stock have notified the
Stockholders in writing that such Stockholders are in favor of such Acquisition
Offer or Control Offer, each Stockholder agrees that such Stockholder shall (i)
vote any shares of Capital Stock of the Corporation having the right to vote
held by such Stockholder (or as to which such Stockholder has voting power)
in favor of the consummation of transactions contemplated by such Acquisition
Offer or Control Offer at any meeting of Stockholders at which such transactions
are considered, (ii) tender all shares of Capital Stock held by such Stockholder
or as to which such Stockholder has power of disposition which are the subject
of such Acquisition Offer or Control Offer in accordance with the terms of the
Acquisition Offer or Control Offer, and (iii) take all other actions required in
order to fully effect the transactions contemplated by such Acquisition Offer or
Control Offer.
6. SPECIFIC PERFORMANCE
The parties hereto agree that it is impossible to measure in
money the damages which will accrue to a party hereto by reason of a failure by
any other party to perform any and all of their obligations under this
Agreement. Accordingly, in addition to any other remedies which such party may
have at law or in equity, the parties agree that each such party shall have the
right to have all obligations, undertakings, agreements, covenants, and other
provisions of this Agreement specifically performed, and that each such party
shall have the right to obtain an order or decree of such specific performance
in any of the courts of the United States or of any state or political
subdivisions thereof. An action for specific performance under this Section 6
shall not be subject to arbitration under Section 8 unless all parties mutually
agree in writing.
7. TERM; TERMINATION
7.1. TERM OF AGREEMENT.
This Agreement shall be effective as of the date first above
written and shall continue in effect until terminated in accordance with the
provisions of Section 7.2 below.
- 13 -
84
7.2. TERMINATION.
This Agreement shall terminate upon the first to occur of the
following events:
(a) the mutual written agreement of all of the Stockholders;
(b) the dissolution and liquidation of the Corporation; or
(c) the consummation of a merger or consolidation as a result of
which the Corporation does not survive.
7.3. RETURN OF PROPRIETARY INFORMATION.
Upon the termination of this Agreement, each Stockholder shall
return to the other Stockholders or the Corporation any and all proprietary and
confidential information provided by such other Stockholders or the Corporation.
8. ARBITRATION
Unless otherwise provided in this Agreement, any controversy or claim
arising out of or relating to this Agreement or any breach of any provision of
this Agreement shall be settled by arbitration in accordance with the rules of
the American Arbitration Association then in force. The parties agree to abide
by all awards rendered in such arbitration proceedings, and all such awards may
be filed by the prevailing party with a court of competent jurisdiction, as a
basis for judgment and the issuance of execution thereon.
9. DEFINITIONS
"Acquisition Offer" shall have the meaning set forth in Section 5.2.
"Affiliate" means, as to any party hereto, any corporation or other
entity which, directly or indirectly, through one or more intermediaries,
controls (i.e., possesses, directly or indirectly, the power to direct or cause
the direction of the management and policies of an entity, whether through
ownership of voting securities, by contract, or otherwise), is controlled by, or
is under common control with such party.
"Agreement" means this Stockholders' Agreement.
- 14 -
85
"best efforts" means, as to a party hereto, an undertaking by such party
to perform or satisfy an obligation or duty or otherwise act in a manner
reasonably calculated to obtain the intended result by action or expenditure not
disproportionate or unduly burdensome in the circumstances, which means, among
other things, that such party shall not be required to (i) expend substantial
funds other than for payment of the reasonable and customary costs and expenses
of employees, counsel, consultants, representatives, or agents of such party in
connection with the performance or satisfaction of such obligation or duty or
other action or (ii) institute litigation or arbitration as a part of its best
efforts.
"Capital Stock" means any share of any class or series of capital stock
or other equity securities of the Corporation or any right or option to acquire
any share of capital stock or other equity securities of the Corporation and
shall include the Common Stock.
"Change of Control" means with respect to an entity (a) a transfer of
all or substantially all of the assets of such entity, (b) a transfer of equity
interest in such entity after which the acquirer holds more than 50% of the
voting power of all equity interests in such entity, (c) the merger,
consolidation, or other reorganization of such entity with or into another
entity, or (d) a change in the composition of the governing body of such entity,
other than in the ordinary course, which results in the replacement of more than
50% of the membership of such governing body, as a result of one transaction or
a series of transactions.
"Common Stock" means the common stock of the Corporation, par value $.01
per share.
"Control Offer" shall have the meaning set forth in Section 5.1 above.
"Control Offeror" shall have the meaning set forth in Section 5.1 above.
"Corporation" means Intracel Cancer Center of Pennsylvania, Inc., a
Delaware corporation.
"First Offer Period" shall have the meaning set forth in Section 4.4.
"Founding Stockholder" shall mean either Intracel Corporation or Lehigh
Valley Hospital and Health Network.
"Initial Public Offering" means the first public sale of Capital Stock
pursuant to a registration statement filed under the Securities Act.
"Joint Venture Agreement" means that certain Joint Venture Agreement
dated as of December 11, 1998, by and between Intracel and Lehigh.
- 15 -
86
"Majority Interest" shall have the meaning set forth in Section 5.1
above.
"Offer" shall have the meaning set forth in Section 4.3.
"Offeree" shall have the meaning set forth in Section 4.1.
"Second Offer Period" shall have the meaning set forth in Section 4.4.
"SEC" means the United States Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Stockholder" means Intracel Corporation and Lehigh Valley Hospital and
Health Network, any other Stockholder listed on Exhibit A or any successor,
assign or transferee thereof as permitted hereunder.
"Subsidiary" means, with respect to any party hereto, any corporation or
other entity of which such party has an equity or other ownership interest that
represents a majority of the voting power of all equity and other ownership
interests in such corporation or other entity.
"Supermajority Vote" means, a vote of at least the number of directors
as set forth in Exhibit B hereto, provided that the vote of such directors must
include at least one director designated by each of the Founding Stockholders.
"Transfer" shall have the meaning set forth in Section 4.2.
"Transferor" shall have the meaning set forth in Section 4.1.
29. MISCELLANEOUS
10.1. FURTHER ASSURANCES.
The parties hereby agree to take whatever further actions or to
execute and deliver whatever further documents or instruments or make whatever
further filings as may be reasonably necessary or desirable to effectuate the
express provisions or the intent of this Agreement.
10.2. CONFLICT AMONG CORPORATION DOCUMENTS.
In the event of a conflict between this Stockholders' Agreement,
the Certificate of Incorporation or the Bylaws of the Corporation, such conflict
shall be resolved with reference to the documents in the following order: first,
by reference
- 16 -
87
to the Certificate of Incorporation of the Corporation; second, by reference to
the Bylaws of the Corporation; and finally, with reference to this Agreement.
10.3. ASSIGNMENT; BINDING EFFECT.
Except as provided in Section 4, this Agreement, and the rights
and obligations of the parties created hereunder, shall not be assigned or
delegated by any Stockholder or the Corporation without the prior written
consent of all parties and any purported or attempted assignment or delegation
without such consent shall be void and without effect. Subject to the foregoing,
this Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors, assigns, heirs, executors,
administrators, and/or personal representatives.
10.4. CONFIDENTIAL AND PROPRIETARY INFORMATION.
Each Stockholder agrees that it shall not, without the prior
written consent of the Corporation, directly or indirectly disclose to anyone
other than the Corporation or the other Stockholders any non-public information
regarding the Corporation and its operations, this Agreement, or the
transactions contemplated hereby or regarding the other Stockholders except to
the extent such disclosure is required by law or legal process. Subject to the
terms of any confidentiality, nondisclosure, or similar agreement between or
among the Stockholders and/or the Corporation, information received by any
Stockholder from the other Stockholders in connection with the transactions
contemplated hereby will be treated by the recipient as proprietary and
confidential and will be made available only to those within its organization
who have a "need to know" in connection with the matters contemplated hereby, to
such recipient's attorneys, accountants, and other
- 17 -
88
professional advisors who are bound by applicable professional rules to maintain
the confidentiality of such information, and as may be required by applicable
law or regulations or as may be requested by any regulatory authority to which
any Stockholder or the Corporation is subject; provided, however, the foregoing
restrictions with respect to information furnished to one party by the other
shall not apply to any such information which the receiving party demonstrates
(a) is on the date hereof, or hereafter becomes, generally available to the
public without restriction and other than as a result of a disclosure, directly
or indirectly, by the receiving party in violation of any confidentiality
agreement or other nondisclosure obligation relating to such information or (b)
was available or becomes available to the receiving party on a confidential or
nonconfidential basis from a source other than the other party hereto, which
source was not itself bound by a confidentiality agreement with such other party
and did not receive such information, directly or indirectly, from a person or
entity so bound.
10.5. GOVERNING LAW.
This Agreement and the rights and obligations of the parties
hereto shall be governed by and construed and enforced in accordance with the
laws of the State of Delaware (excluding the choice of law rules thereof).
10.6. SEVERABILITY.
In the event that a court of competent jurisdiction holds that a
particular provision or requirement of this Agreement is in violation of any
applicable law, each such provision or requirement shall be enforced only to the
extent it is not in violation of such law or is not otherwise unenforceable and
all other provisions and requirements of this Agreement shall remain in full
force and effect.
10.7. EXPENSES; ATTORNEYS' FEES.
The parties shall pay their own respective expenses (including,
without limitation, the fees, disbursements and expenses of their attorneys,
accountants, actuaries, and financial and other advisors) in connection with the
negotiation and preparation of this Agreement and the transactions contemplated
hereby. If any party is required to institute legal action or arbitration
against another party to enforce the provisions of this Agreement, the
prevailing party shall be entitled to recover costs of litigation, including,
but without limitation, reasonable attorneys' fees.
- 18 -
89
10.8. AMENDMENT.
This Agreement shall not be modified or amended except by an
instrument in writing executed by all of the Stockholders. All such instruments
shall be serially numbered and dated, whereupon they shall become an integral
part of, or construed together with, this Agreement. Notwithstanding the
foregoing, the Corporation shall have the authority to amend Exhibit A and/or
Exhibit B to reflect a designation of directors received from one or more
Stockholders in accordance with Section 3.1 above, without the need for any
Stockholder to execute such amended Exhibit A and/or Exhibit B. The Corporation
shall forthwith provide copies of any such counterpart or amended Exhibit A
and/or Exhibit B to each Stockholder.
10.9. WAIVER.
No delay or failure on the part of any party hereto in
exercising any right, power, or privilege under this Agreement or any other
instruments executed and delivered in connection with or pursuant to this
Agreement, shall impair any such right, power, or privilege or be construed as a
waiver of any default hereunder or any acquiescence therein. No single or
partial exercise of any such right, power, or privilege shall preclude the
further exercise of such right, power, or privilege, or the exercise of any
other right, power, or privilege. No waiver shall be valid against any party
hereto unless made in writing and signed by the party against whom enforcement
of such waiver is sought and then only to the extent expressly specified
therein.
10.10. NOTICE.
All notices, demands, requests or other communications which may
be or are required to be given, served or sent by any party to any other party
pursuant to this Agreement shall be in writing and shall be hand delivered
(including delivery by courier), sent by Federal Express or by other recognized
overnight delivery service, mailed by first-class, registered or certified mail,
return receipt requested, postage prepaid, or sent by telegram, telex, or
facsimile transmission, addressed as follows:
if to the Corporation:
Intracel Cancer Center of
Pennsylvania, Inc.
---------------------------------------------
---------------------------------------------
Attn:
----------------------------------------
Facsimile: ( )
----------------------------
with a copy (which shall not constitute notice) to:
if to Intracel:
Intracel Corporation
0000 Xxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxx X. Xxxxx
Facsimile: (000) 000-0000
with a copy (which shall not constitute notice) to:
Xxxxx & Xxxxxxx L.L.P.
000 00xx Xxxxxx, X. X.
Xxxxxxxxxx, X.X. 00000-0000
Attn: Xxxxx X. Xxxxxxx, Esq.
Facsimile: (000) 000-0000
- 19 -
90
if to Lehigh:
Lehigh Valley Hospital and Health Network
Xxxxx Xxxxx & X-00
X.X. Xxx 000
Xxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attn: Xxxxx X. Xxxxxxxxx
Facsimile: (000) 000-0000
with a copy (which shall not constitute notice) to:
Xxxxxxx, Hudders & Xxxxxxxxxx
The Paragon Centre
0000 Xxxx Xxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attn: Xxxxxxx X. Xxxxxxxxxx, Esq.
Facsimile: (000) 000-0000
if to other Stockholders, to the address set forth on Exhibit A:
Each party may designate by notice in writing a new address to which any notice,
demand, request or communication may thereafter be so given, served, or sent.
Each notice, demand, request, or communication which shall be mailed, delivered,
or transmitted in the manner described above shall be deemed sufficiently given,
served, sent, or received for all purposes at such time as it is delivered to
the addressee (with the return receipt, the delivery receipt, the affidavit of
messenger, or (with respect to a telex or facsimile) the answer back being
deemed conclusive, but not exclusive, evidence of such delivery) or at such time
as delivery is refused by the addressee upon presentation.
10.11. BENEFIT OF THIS AGREEMENT.
It is the explicit intention of the parties hereto that no
person or entity other than a party hereto (including the Corporation) is or
shall be entitled to bring any action to enforce any provision of this Agreement
against any of the parties hereto, and that the covenants, undertakings, and
agreements set forth in this Agreement shall be solely for the benefit of, and
shall be enforceable only by, the parties hereto or their respective successors
and assigns as permitted hereunder.
- 20 -
91
10.12. SURVIVAL.
Neither expiration nor termination of this Agreement shall
terminate those obligations and rights of the parties pursuant to provisions of
this Agreement which by their express terms are intended to survive and such
provisions shall survive the expiration or termination of this Agreement.
10.13. COMPLETE AGREEMENT.
This Agreement, together with the Exhibits and Schedules hereto,
sets forth the entire agreement of the parties hereto with respect to its
subject matter and any and all prior agreements, whether oral or written,
between or among the parties hereto and relating to the subject matter hereof
are superseded hereby.
10.14. EXECUTION IN COUNTERPARTS.
This Agreement may be executed in counterparts, each of which
shall constitute an original hereof for all purposes.
- 21 -
92
IN WITNESS WHEREOF, each of the parties has duly caused this
Agreement to be duly executed in its name and on its behalf, as of the date
first written above.
INTRACEL CANCER CENTER
OF PENNSYLVANIA, INC.
By:___________________________________
Name:________________________________
Title:_________________________________
INTRACEL CORPORATION
By:___________________________________
Name:________________________________
Title:_________________________________
LEHIGH VALLEY HOSPITAL AND HEALTH NETWORK
By:___________________________________
Name:________________________________
Title:_________________________________
- 22 -
93
EXHIBIT G
FINAL ONCOVAX CENTER LEASE
THIS FINAL ONCOVAX CENTER LEASE (this "LEASE"), is entered into
as of ________ __, 1998 by and between LEHIGH VALLEY HOSPITAL AND HEALTH
NETWORK, a Pennsylvania non-profit corporation ("LANDLORD"), having its
principal office at Xxxxx Xxxxx & X-00, Xxxxxxxxx, XX and INTRACEL CANCER CENTER
OF PENNSYLVANIA, INC., a Delaware corporation ("TENANT"), having its principal
office at ________________________________.
W I T N E S S E T H:
1. LEASED PREMISES; FIXTURES AND EQUIPMENT; COMMON AREAS
Landlord does hereby grant, demise and lease unto Tenant, and
Tenant does hereby lease and take from Landlord, for the Term (as defined below)
and upon the terms and conditions set forth in this Lease, the premises known as
the "Clean Room" which is located on the second floor of the General Services
Building of Landlord's hospital and described on Exhibit A attached hereto,
together with the clinical patient care, administrative and storage space also
described on Exhibit A, and all improvements made by Landlord, now or hereafter
constructed thereon and all rights, privileges, easements and appurtenances
belonging or pertaining thereto (collectively, the "LEASED PREMISES" ), together
with all of Landlord's fixtures and personal property, whether owned or leased
by Landlord, located on or used or useful or associated with, the Leased
Premises (as defined in Exhibit B), and all other furnishings, machinery,
apparatus, movable or non-movable equipment and materials described in Exhibit B
attached hereto (collectively the "FIXTURES AND EQUIPMENT"). Landlord also
hereby grants to Tenant a nonexclusive license for the benefit of Tenant, its
employees, agents and invitees for access to and from the Leased Premises
through the building and over the property of Landlord appurtenant thereto, and
to use those parts of the building designated by Landlord for use by tenants
including, but not limited to toilet rooms, elevators and unrestricted parking
areas, all as more particularly described in Exhibit C attached hereto
(collectively, the "COMMON AREAS").
2. SERVICES
During the Term, Landlord shall provide Tenant with all services,
including, but not limited to, electricity, heat, gas and air conditioning
(collectively "UTILITIES"), removal of hazardous waste, cleaning services and
laundry, necessary
94
and sufficient for Tenant to use the Leased Premises as described in Section 9.1
below.
3. POSSESSION
Landlord shall deliver to Tenant on the Commencement Date (as
herein defined) actual and exclusive possession of the Leased Premises, free and
clear of all leases, tenancies, agreements, matters, liens and defects in title,
together with exclusive possession of the Fixtures and Equipment.
4. TERM
The initial term of this Lease (the "INITIAL TERM") shall
commence on the Final Closing Date as that term is defined in that certain Joint
Venture Agreement (the "JOINT VENTURE AGREEMENT") entered into by and between
the parties hereto on December 11, 1998 (the "COMMENCEMENT DATE") and shall end,
unless earlier terminated as described in Section 5 below, on the ten year
anniversary date after the Final Closing Date. Thereafter, Tenant may extend the
term of this Lease for additional ____ year terms ("RENEWAL TERMS") by the
delivery of written notice to Landlord at least _____ days prior to the
expiration of the then effective Initial Term or Renewal Term. The Initial Term
and all Renewal Terms shall hereinafter be collectively referred to as the
"TERM". The parties agree that upon expiration or earlier termination as
described in Section 5 below, this Lease shall immediately expire or terminate
without the necessity of any notice from either Landlord or Tenant to terminate
the same, and Tenant hereby expressly waives all right to any notice which may
be required under any laws now or hereafter enacted and in force in
Pennsylvania, including The Landlord and Tenant Act of 1951, Act of April 6,
1951, Act of April 6, 1951, P.L. 69 as amended (the "ACT") upon such expiration
or termination.
5. EARLY TERMINATION
5.1. TERMINATION OF JOINT VENTURE AGREEMENT
This Lease shall immediately terminate if the Joint Venture Agreement is
terminated for any reason.
5.2. EVENTS OF DEFAULT; REMEDIES
5.2.1. EVENTS OF DEFAULT BY TENANT
Any of the following occurrences or acts shall constitute an
"Event of Default" under this Lease:
2
95
(i) Tenant fails to pay, on the date on which the same is
due and payable, any installment of monthly rent and any additional payments,
within ten days after Landlord notifies that such payment is overdue and due and
owing.
(ii) Except as otherwise provided herein, a party fails to
observe or perform any other provision hereof for 30 days (or such shorter
period of time if such default endangers life or property) after the
non-breaching party shall have delivered to Tenant notice of such failure.
(iii) A party's filing of a petition in bankruptcy under
Title 11 of the United States Code, as amended, or the commencement of a
proceeding under any other applicable law concerning insolvency, reorganization
or bankruptcy or a party becomes generally unable to pay its debts as they
become due; provided, however, if a proceeding with respect to an act of
bankruptcy is filed or commenced against Tenant, the same shall not constitute
an Event of Default if such proceeding is dismissed within 60 days from the date
of such filing.
(iv) The Leased Premises shall have been abandoned.
(v) Any representation or warranty made herein or any
statement or representation made in any certificate, report or opinion
(including legal opinions), financial statement or other instrument furnished in
connection with this Lease, proves to have been incorrect, false or misleading
in any material respect when made.
(vi) A party fails to comply with any requirement of any
governmental authority having jurisdiction within the time required by such
governmental authority; or any proceeding is commenced or action taken to
enforce any remedy for a violation of any requirement of a governmental
authority or any restrictive covenant affecting the Leased Premises or any part
thereof.
5.2.2. REMEDIES
If an Event of Default shall have happened and be continuing, a
party shall have the right at its election, then or at any time thereafter while
such Event of Default shall continue, to give written notice of its intention to
terminate this Lease on a date specified in such notice. Upon the giving of such
notice, the Term and the estate hereby granted shall expire and terminate on
such date as fully and completely and with the same effect as if such date were
the date hereinbefore fixed for the expiration of the Term.
5.3. OTHER TERMINATION EVENTS
This Lease may also be earlier terminated as further described in
Sections 10.4 and 15 below.
3
96
6. ACTIONS UPON TERMINATION
Upon the expiration or termination of this Lease,
(i) Tenant shall immediately permit Landlord and its employees
and agents full access to the Leased Premises to aid in the transition to a new
operator, and further agrees to give up quiet and peaceful possession without
further notice from Landlord.
(ii) If termination results because of Tenant's Event of Default,
Tenant shall continue to pay to Landlord the monthly rent until the end of the
Term; provided, that Tenant shall not be responsible for such rent if the Leased
Premises have been relet.
7. PAYMENTS
7.1. RENTAL PAYMENTS
Tenant shall pay as rent for the Leased Premises and the Fixtures
and Equipment to Landlord during the period of time from the Commencement Date
through the Term monthly installments of ____________________ ($_______), in
advance without demand on or before the first day of each month from and
including the month in which the Commencement Date occurs, which the parties
agree reflects the fair market rental value of the Leased Premises and the
Fixtures and Equipment. Such rent shall be adjusted on an annual basis to
reflect the fair market rental value of the Leased Premises and the Fixtures and
Equipment. Rent for any partial month shall be prorated based upon the actual
number days in such month.
7.2. ADDITIONAL PAYMENTS
Tenant shall pay as additional payments for the services provided
in Section 2 above (except Utilities which Landlord shall provide to Tenant
without any additional payments), monthly installments of
__________________________ ($________), in advance without demand on or before
the first day of each month from and including the month in which the
Commencement Date occurs, which the parties agree reflects the fair market value
of the services provided in Section 2.
7.3. DEFAULT
Tenant may not be declared in default for non-payment of rent or
any additional payments due hereunder if such rent or additional payments is/are
received by Landlord by the 10th day of the month.
4
97
8. TITLE AND QUIET ENJOYMENT
Subject to Section 18 below, Landlord hereby represents, warrants
and covenants that it has good and marketable fee simple title to the Leased
Premises, that the same is subject to no other leases, tenancies, agreements,
encumbrances (including delinquent taxes), liens or defects in title affecting
said property or the rights granted Tenant in this Lease. Landlord further
covenants that there are no restrictive covenants, zoning or other local
ordinances or regulations which will prevent Tenant from using and occupying the
Leased Premises for a current Good Manufacturing Practices ("CGMP") laboratory
and support area. Landlord further represents, warrants and covenants that it
has good and marketable title to all Fixtures and Equipment and that same are
subject to no leases, agreements, encumbrances, liens or defects in title
affecting said property or the rights granted Tenant in this Lease. Landlord
covenants and agrees that during the Term, Tenant shall, upon paying the rent
and performing the covenants of this Lease on its part to be performed,
peaceably and quietly have, hold and enjoy the Leased Premises and Fixtures and
Equipment and all rights granted Tenant in this Lease.
9. USES OF LEASED PREMISES; ACCESS TO LEASED PREMISES AND COMMON AREAS
9.1. TENANT'S USE OF LEASED PREMISES
The Leased Premises and the Fixtures and Equipment therein shall
be used for the conduct and operation of a cGMP laboratory and support area in
conformity with applicable law and the terms and conditions of the Joint Venture
Agreement. The Leased Premises shall be operated under the names of "Intracel
Cancer Center of Pennsylvania, Inc.," and the "OncoVax Center", and no other
names shall be permitted to be used in lieu of or in addition to such name
without the prior written consent of Landlord. Tenant hereby agrees to comply
and conform in all material respects with all legal requirements concerning the
use, occupancy and conditions of the Leased Premises and all machinery,
equipment, furnishings, fixtures and improvements therein. If any such legal
requirement requires an occupancy or use permit, license, special exception, or
other local, state or federal agency certification, then Tenant shall promptly
obtain and keep current the same.
9.2. LANDLORD ACCESS TO LEASED PREMISES
Landlord may enter upon the Leased Premises, upon reasonable
notice to Tenant, to inspect, maintain, repair the Leased Premises. Landlord may
enter the Leased Premises at any time to perform emergency repairs to preserve
the Leased Premises and/or the Fixtures and Equipment.
5
98
9.3. TENANT'S ACCESS TO LEASED PREMISES AND COMMON AREAS
Landlord shall keep the Leased Premises and the Common Areas
"open" during normal business hours which, for purposes of this Lease, shall
mean 24 hours a day, 365 days a year. Landlord shall provide lighting,
electricity, heat, air conditioning, water, elevator service and other necessary
services for Tenant's use and access to the Leased Premises and the Common Areas
when open. Tenant's use of the Common Areas shall not unreasonably hinder or
interfere with the Landlord's or other tenants' use of their Common Areas.
10. CONDITION OF LEASED PREMISES, FIXTURES AND EQUIPMENT; MAINTENANCE AND
REPAIRS
10.1. CONDITION OF LEASED PREMISES, FIXTURES AND EQUIPMENT
Landlord hereby represents and warrants that the Leased Premises
are constructed substantially in compliance with all applicable building codes
and regulations and substantially in accordance with the plan and specifications
approved by the Commonwealth of Pennsylvania Board of Health (the "BOARD OF
HEALTH"). Upon the expiration or earlier termination of the Lease, Tenant shall
surrender the Leased Premises in good condition, reasonable wear and tear and
damage by casualty and fire excepted, with all lighting, plumbing, electrical
and life/safety systems and the Fixtures and Equipment, in good working
condition, other than the "Tenant's Fixtures and Equipment Required to be
Removed" (as defined in Section 11.2).
10.2. TENANT'S MAINTENANCE AND REPAIRS
During the Term of this Lease, Tenant, at its expense, hereby
agrees to clean, and maintain and keep in good repair its equipment.
10.3. LANDLORD'S MAINTENANCE AND REPAIRS
Landlord shall make and pay for all repairs, replacements and
maintenance which are necessary for the operation of the Leased Premises, the
Common Areas, and the Fixtures and Equipment, excluding repairs or maintenance
necessitated by Tenant's willful acts or gross negligence. Tenant agrees to
notify Landlord of any necessary repairs within a reasonable period time of its
discovery. If Landlord fails to commence to perform any such maintenance,
replacement and repair after five days notice from Tenant, Tenant shall have the
right to undertake such maintenance, replacement and repair and to deduct any
expenditures associated therewith from the rent payments due under Section 7.1
above.
6
99
10.4. FIRE OR OTHER HAZARD
Tenant hereby agrees to notify Landlord of any damages to the
Leased Premises resulting from fire or other hazard and also of any dangerous or
hazardous condition within the Leased Premises immediately upon the occurrence
of such fire or other hazard or discovery of such condition, or as soon as
practicable thereafter. Upon occurrence of a fire, repairs shall be made by
Landlord as soon as reasonably may be done unless the costs of repairing the
Leased Premises exceed 25% of the replacement cost of the building in which case
the Landlord may, at its option, terminate this Lease by giving Tenant written
notice of termination within 45 days of the date of such fire. If the Landlord
does not terminate this Lease as described above, then Landlord has 45 days
after the date of such fire to give written notice to Tenant setting forth
Landlord's unqualified commitment to make all necessary repairs or replacements,
the projected date of commencement of such repairs, and Landlord's good faith
estimate of the date of completion of the same. If Landlord fails to give such
notice, or if the date of completion is more than 90 days after the date of the
fire or other hazard, then Tenant may, at its option, terminate this Lease and
Landlord will be obligated to refund to Tenant any rent allocable to the period
subsequent to the date of the fire. During any period of restoration and repair
Tenant shall continue to operate within the Leased Premises to the extent
practicable, with a pro-rata reduction in the rental payments based upon the
usable portions of the Leased Premises.
11. ALTERATIONS AND REMODELING OF LEASED PREMISES, AND FIXTURES AND EQUIPMENT
11.1. ALTERATIONS AND MODIFICATIONS TO THE LEASED PREMISES
Tenant may, at its own expense, from time to time during the term
of this Lease, upon the prior written approval of Landlord as described in
Section 11.3 below, make such structural alterations, additions, replacements
and changes, in and to the Leased Premises, and any buildings thereon, as it
finds necessary or desirable for the operation of the Leased Premises as a cGMP
laboratory. All such alterations, demolitions, additions, replacements and
changes shall be made in accordance with plans and specifications prepared by
Tenant and approved by Landlord, in conformity with applicable building laws and
regulations. Such alterations, additions, replacements and changes shall become
a part of the Leased Premises, shall be maintained and kept in repair in
accordance with the provisions of Section 10, and at the expiration or
termination of this Lease shall become the property of Landlord.
7
100
11.2. ALTERATIONS AND MODIFICATIONS TO THE FIXTURES AND EQUIPMENT
Tenant may, at its own expense, from time-to-time during the term
of this Lease, install, replace and operate in the Leased Premises such
removable medical equipment and personal property ("TENANT'S FIXTURES AND
EQUIPMENT") as it shall deem necessary or desirable in the conduct of its
business, provided all laws, rules and regulations of governmental bodies with
respect thereto shall be in all material respects complied with by Tenant.
Tenant's Fixtures and Equipment shall include the "Clean Room Equipment" as
described on Exhibit D hereto. Tenant may also, upon the prior written approval
of Landlord as described in Section 11.3 below, make such alterations,
additions, replacements and changes, in and to the Fixtures and Equipment, as it
finds necessary or desirable for the operation of a cGMP laboratory. Prior to
the expiration or termination of this Lease, Landlord and Tenant shall designate
those items of Tenant's Fixtures and Equipment that Landlord or Tenant desires
be removed from the Leased Premises, which shall include the "Clean Room
Equipment" described on Exhibit D, upon the expiration or termination of the
Lease ("TENANT'S FIXTURES AND EQUIPMENT REQUIRED TO BE REMOVED"). With the
exception of Tenant's Fixtures and Equipment Required to be Removed, all of the
Fixtures and Equipment shall remain on the Leased Premises at the termination of
this Lease and shall remain the property of Landlord and Landlord shall pay
Tenant the fair market value of any alterations, addition, or replacements to
such Fixtures and Equipment.
11.3. LANDLORD'S CONSENT
Landlord agrees not to unreasonably withhold, delay or condition
its consent to any action proposed by Tenant pursuant to this Section 11,
provided that (i) the alterations, construction or installation shall not have a
material adverse effect on the structure, appearance or use of the Leased
Premises or the building in which the Leased Premises are located or Fixtures
and the Equipment, in the reasonable judgment of Landlord, (ii) all such
alterations, construction and installations shall be expeditiously completed in
compliance with all legal requirements, (iii) all work done in connection with
any such alterations, construction or installation shall comply with the
requirements of any insurance policy required to be maintained by Tenant
hereunder, (iv) Tenant shall promptly pay all costs and expenses of any such
alteration, construction or installation and shall discharge all liens filed
against any of the Leased Premises or the Fixtures and Equipment arising out of
the same, (v) Tenant shall procure and pay for all permits and licenses required
in connection with any such alteration, construction or installation, (vi) such
alterations shall comply with any recorded lien or covenant affecting the Leased
Premises, and (vii) Landlord shall incur no expense or cost whatsoever in
connection with such alterations, including without limitation, costs for
reviewing and approving plans, or tap fees or other utility fees. Landlord may
require, as a condition to its consent to any alterations, reasonable
appropriate payments, bonds, assurances and undertakings from Tenant to ensure
that all such
8
101
conditions are satisfied. Notwithstanding the foregoing, it shall not be
unreasonable for Landlord to withhold its consent, or to condition its consent,
if the holder of a mortgage withholds its consent to any of the foregoing, or
requires that certain conditions or requirements be satisfied or observed.
11.4. LIENS OR ENCUMBRANCES
Except as permitted under Section 18, neither Tenant nor Landlord will
directly or indirectly, create or permit to be created or to remain, and will
promptly discharge, at its expense, any lien or encumbrance with respect to, the
Leased Premises or any part thereof, or the Fixtures and Equipment or either
party interest therein as a result of any alteration, construction, installation
or other action of either party. The existence of any mechanic's, laborer's,
materialman's, supplier's or vendor's lien, or any right in respect thereof,
shall not constitute a violation of this Section 11.4 if payment is not yet due
upon the contract or for the goods or services in respect of which any such lien
has arisen so long as such payment is made or bonded off within 30 days after
the later to occur of the completion of the work which gave rise to the
imposition of said liens or the rendering of the invoice, statement or demand
for such payment. Nothing contained in this Lease shall be construed as
constituting the consent or request of Landlord, expressed or implied, of any
contractor, subcontractor, laborer, materialman or vendor to or for the
performance of any labor or services or other furnishing of any materials for
any construction, alteration, addition, repair or demolition of or to the Leased
Premises or any part thereof.
12. ENVIRONMENTAL MATTERS
12.1. DEFINITIONS
As used in herein, the following items shall have meanings set
forth below:
(i) "CAA" shall mean the Clean Air Act, codified at
42 U.S.C. Sections 7401, et seq., as amended.
(ii) "CERCLA" shall mean the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, codified at 42
U.S.C. Sections 9601, et seq., as amended.
(iii) "CWA" shall mean the Clean Water Act,
codified at 33 U.S.C. Sections 407, et seq., as amended.
9
102
(iv) "ENFORCEMENT AGENCY" shall mean, collectively,
the Environmental Protection Agency ("EPA") and any state, county, municipal or
other agency having authority to enforce any Environmental Laws.
(v) "ENVIRONMENTAL LAWS" - shall mean CERCLA, HMTA,
RCRA, CAA, CWA, TSCA, RHA and the Right-to-Know Act and all other federal, local
and municipal laws, statutes, ordinances and codes, guidelines and standards
relating to health, safety, sanitation, and the protection of the environment or
governing the use, storage, treatment, generation, transportation, processing,
handling, production or disposal of Hazardous Materials, including, without
limitation, the Pennsylvania Solid Waste Management Act, 35 P.S. Sections
6018.103, et. seq., the Pennsylvania Hazardous Sites Clean Up Act (Act 108 of
1988), laws and regulations regarding the discharge of water or other materials
or fluids into waterways, and the rules, regulations, guidelines, decisions,
orders and directives of federal, local and municipal governmental agencies,
authorities and courts with respect thereto presently in effect or hereafter
enacted, promulgated or implemented.
(vi) "ENVIRONMENTAL PERMITS" - shall mean all
permits, licenses, approvals, authorizations, consents or registrations required
by any applicable Environmental Laws, on either an individual or group basis, in
connection with the construction, ownership, use or operation of the Leased
Premises, or the storage, treatment, generation, transportation, processing,
handling, production or disposal of Hazardous Materials related to the Leased
Premises.
(vii) "HAZARDOUS MATERIALS" - shall mean, without
limitation, flammable, explosives, radioactive materials, asbestos, urea
formaldehyde foam insulation, polychlorinated biphenyls, petroleum or petroleum
based or related substances, hydrocarbons or like substances and their additives
or constituents, and any substances now or hereafter defined as "hazardous
substances," "extremely hazardous substances," "hazardous wastes," "infectious
wastes" or "toxic chemicals" in any Environmental Laws, or in any regulation or
order issued pursuant to any Environmental Laws.
(viii) "HMTA" - shall mean the Hazardous Materials
Transportation Act, codified at 49 U.S.C. Sections 1801, et seq., as amended.
(ix) "RCRA" - shall mean the Resource Conservation
and Recovery Act of 1976, codified at 42 U.S.C. Sections 6801, et seq.,
as amended.
(x) "RELEASE" - shall have the same meaning as
given to that term in CERCLA, as amended, and the regulations promulgated
thereunder.
(xi) "RHA" - shall mean the Rivers and Harbors
Appropriation Act, codified at 33 U.S.C. Sections 401, et seq., as amended.
10
103
(xii) "RIGHT-TO-KNOW ACT" - shall mean the
Emergency Planning and Community Right-To-Know Act, codified at 42 U.S.C.
Sections 11001, et seq., as amended.
(xiii) "TSCA" - shall mean the Toxic Substances
Control Act, codified at 15 U.S.C. Sections 2601, et seq., as amended.
12.2. LANDLORD OBLIGATIONS; REPRESENTATION AND WARRANTIES
Landlord hereby represents and warrants to Tenant that on the
Commencement Date the Leased Premises does not contain asbestos or any Hazardous
Materials. Landlord shall be responsible for costs, expenses, damages and
penalties resulting from the existence of any Hazardous Materials in the Leased
Premises at the date of execution of this Lease and all alterations made by
Landlord to the Leased Premises or the Common Areas shall be made in accordance
any comply with all Environmental Laws and the requirements of any Enforcement
Agencies.
12.3. TENANT OBLIGATIONS
Tenant shall comply at all times and in all respects with the
provisions of all Environmental Laws and Environmental Permits, and shall not
commit any actions or omissions that result in the incurrence of any liability
under such Environmental Laws and Environmental Permits. Tenant shall obtain,
whenever necessary and in its own name, appropriate Environmental Permits for
its operations and shall comply in all respects with the requirements of such
Environmental Permits. All alterations made in the Leased Premises made by
Tenant shall be made in accordance with and shall comply with all Environmental
Laws and the requirements of any Enforcement Agencies. If any statutes, laws,
ordinances, rules or regulations are promulgated at any time after the date of
execution of this Lease for the removal, abatement or containment of Hazardous
Materials in the Leased Premises or any portion of the Leased Premises and, in
the reasonable judgment of Landlord, it is hazardous for the Tenant to remain in
the Leased Premises during such removal, abatement, or containment of the
Hazardous Materials, Tenant shall vacate the Leased Premises or that portion of
the Leased Premises that is hazardous and, provided that such condition did not
result from Tenant's acts, omissions, or operations, Tenant's rent shall be
abated proportionately for the period of time in which Tenant's use of such
portion of the Leased Premises has been interrupted. Tenant shall not
intentionally or unintentionally use, store, handle, spill or discharge any
Hazardous Materials at or in the vicinity of the Leased Premises, other than
those Hazardous Materials generally used, stored or handled in a cGMP
laboratory. Tenant shall promptly deliver to Landlord copies of all notices made
by Tenant to, or received by Tenant from, any Enforcement Agency or from the
United States Occupational Safety and
11
104
Health Administration concerning environmental matters or Hazardous Materials at
the Leased Premises.
12.4. INDEMNIFICATION; HOLD HARMLESS
Landlord shall indemnify, defend and hold Tenant harmless of and
from actual and direct losses arising out of or relating to any and all claims
arising from the existence, removal, containment, or abatement of any Hazardous
Materials from the Leased Premises related to Hazardous Materials existing in
the Leased Premises prior to the Commencement Date. Tenant shall indemnify,
defend and hold Landlord harmless of and from actual and direct losses arising
out of or relating to any and all claims arising by reason of any violation by
Tenant of the provisions of Section 12.3 above. This indemnity provision shall
survive expiration or earlier termination of this Lease.
12.5. INSPECTIONS
At any time throughout the Term of this Lease, Landlord may cause
an inspection to be made of the Leased Premises and its surrounding area for the
purpose of determining whether any Hazardous Materials is present thereon.
13. INSURANCE
13.1. TENANT INSURANCE
Tenant shall, at all times through the Term and at its sole expense,
maintain professional and general liability insurance (through third party
insurers) against claims for bodily injury or death occurring in or about the
Leased Premises, such insurance to provide coverage not less than $3,000,000 per
occurrence, $5,000,000 per annual aggregate. All such insurance shall name
Landlord as an additional insured and shall provide that Landlord be given 30
days prior notice of any material change or cancellation of such insurance.
Copies of such insurance policies shall be delivered to Landlord, upon
Landlord's request.
13.2. LANDLORD'S INSURANCE
Landlord shall, at all times through the Term and at its sole
expense, maintain insurance for the Leased Premises and the Common Areas at
replacement cost value, without coinsurance provisions, against fire and such
other hazards as are included within extended coverage and against earthquake
and flood damage, which insurance shall also include major mechanical system
repair and replacement coverage. In addition, Landlord shall, at all times
through the Term and at its sole expense, maintain insurance for the Fixtures
and Equipment at
12
105
replacement cost value, without coinsurance provisions, against fire and such
other hazards as are included within extended coverage and against earthquake
and flood damage, which insurance shall also include major mechanical system
repair and replacement coverage. Copies of such insurance policies shall be
delivered to Tenant, upon Tenant's request.
14. LIABILITY OF LANDLORD
Landlord shall be liable for all loss of property by theft or
otherwise, for all damage to property, for all injuries to persons while on the
Leased Premises from escape or leakage of water, rain, snow, or steam from any
part of the building on which the Leased Premises are located or from the pipes
or plumbing system therein, and for all damage resulting from the short
circuiting of electricity or from any other cause, where any such losses,
damages and/or injuries are due to the willful acts or negligence of the
Landlord, its servant, agents, or employees.
15. CONDEMNATION
If all or a part of the Leased Premises and/or Common Areas are taken by
eminent domain or conveyed in lieu thereof and such Leased Premises cannot then
be used by Tenant for its intended use as set forth in Section 9.1 above, this
Lease shall immediately terminate as of the date that the condemning authority
takes possession of the Leased Premises, subject to the following:
(i) All compensation awarded for the taking (or the proceeds of any
sale in lieu thereof) of the Leased Premises and/or Common Areas
shall be the property of the Landlord;
(ii) All compensation awarded for the taking or loss of any of the
Tenant's Fixtures and Equipment or for moving or relocation
expenses shall be the property of Tenant; and
(iii) If only part of the Leased Premises and/or Common Areas are taken
such that Tenant may still use the Leases Premises for its
intended use, this Lease shall remain in effect with a pro-rata
reduction in the rental payments based upon the usable portions
of the Leased Premises.
16. ASSIGNING OR SUBLETTING
Tenant shall not assign, sublet or in any manner transfer this
Lease or any estate or interest therein, or grant a license, concession or other
right of occupancy, to all or part of the Leased Premises, without Landlord's
prior written
13
106
consent, except that Tenant may assign, sublet or in any manner transfer this
Lease of any estate or interest therein, or grant a license, concession or other
right of occupancy, to all of part of the Leased Premises (i) to any successor
to Tenant in the event of a merger or consolidation of Tenant with another
entity, or to any purchaser of all or substantially all of the assets or
business of Tenant, and (ii) to an Affiliate (as defined below). For purposes of
this Section 16, an Affiliate shall mean, as to any party hereto, any
corporation or other entity which, directly or indirectly, through one or more
intermediaries, controls (i.e., possesses, directly or indirectly, the power to
direct or cause the direction of the management and policies of an entity,
whether through ownership of voting securities, by contract, or otherwise) is
controlled by, or is under common control with such party. In the event of any
permitted assignment, all rights, obligations and liabilities herein shall
extend to any successors or assigns.
17. WAIVER OF SUBROGATION
To the extent permitted by their insurers, Landlord hereby
releases Tenant, and Tenant hereby releases Landlord, and their respective
shareholders or members, directors, officers, employees and agents, from any and
all claims or demands for damages, losses, expenses, or injury to the Leased
Premises, or to the Fixtures and Equipment, or the inventory or other property
of Landlord or Tenant, as the case may be, in, or about, the Leased Premises
which may be caused by or results from events or happenings which are covered by
insurance carried by the respective parties and in force at the time of any such
damages, losses, expenses, or injury.
18. SUBORDINATION; ESTOPPEL CERTIFICATES
Subject to Section 8 above, this Lease is subordinate to the lien
of all present or future mortgages which affect the Leased Premises and to all
renewals, modifications, replacements and extensions thereof. This provision
shall be self-operative, but in any event Tenant hereby agrees to execute
promptly and deliver any estoppel certificate or other assurances that Landlord
may request in furtherance hereof. In the event of any foreclosure of any such
mortgage or modification, Tenant shall attorn to the purchaser in foreclosure of
who shall be named in any deed in lieu of foreclosure, shall recognize any such
purchaser as the Landlord under this Lease, and so long as Tenant is not in
default hereunder, this Lease shall remain in full force and effect.
14
107
19. MISCELLANEOUS
19.1. NOTICE
All notices, demands, requests or other communications which may
be or are required to be given, served or sent by any party to any other party
pursuant to this Lease shall be in writing and shall be hand delivered
(including delivery by courier), sent by Federal Express or by other recognized
overnight delivery service, mailed by first-class, registered or certified mail,
return receipt requested, postage prepaid, or sent by telegram, telex, or
facsimile transmission, addressed as follows:
If to ICC:
Intracel Cancer Center of Pennsylvania, Inc.
____________________________________________
____________________________________________
____________________________________________
Attn: _____________________________________
Facsimile: ________________________________
with a copy (which shall not constitute notice) to:
Xxxxx & Xxxxxxx L.L.P.
000 00xx Xxxxxx, X. X.
Xxxxxxxxxx, X.X. 00000-0000
Attn: Xxxxx X. Xxxxxxx, Esq.
Facsimile: (000) 000-0000
If to Lehigh:
Lehigh Valley Hospital and Health Network
Xxxxx Xxxxx & X-00
X.X. Xxx 000
Xxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attn: Xxxxx X. Xxxxxxxxx
Facsimile: (000) 000-0000
15
108
with a copy (which shall not constitute notice) to:
Xxxxxxx, Hudders & Xxxxxxxxxx
The Paragon Centre
0000 Xxxx Xxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attn: Xxxxxxx X. Xxxxxxxxxx, Esq.
Facsimile: (000) 000-0000
Each party may designate by notice in writing a new address to
which any notice, demand, request or communication may thereafter be so given,
served, or sent. Each notice, demand, request, or communication which shall be
mailed, delivered, or transmitted in the manner described above shall be deemed
sufficiently given, served, sent, or received for all purposes at such time as
it is delivered to the addressee (with the return receipt, the delivery receipt,
the affidavit of messenger, or (with respect to a telex or facsimile) the answer
back being deemed conclusive, but not exclusive, evidence of such delivery) or
at such time as delivery is refused by the addressee upon presentation.
19.2. COMPLETE AGREEMENT
This Lease, and all Exhibits hereto and incorporated agreements
(including the Joint Venture Agreement) set forth the entire agreement of the
parties hereto with respect to its subject matter and any and all prior
agreements, whether oral or written, between or among the parties hereto and
relating to the subject matter hereof are superseded hereby.
19.3. GOVERNING LAW
This Lease and the rights and obligations of the parties hereto
shall be governed by and construed and enforced in accordance with the laws of
the Commonwealth of Pennsylvania (excluding choice of laws rules thereof).
19.4. PARAGRAPH HEADINGS
The paragraph headings in this Lease are for convenience only and
are not a part of this Lease and do not in any way limit or amplify the terms
and provisions hereof and in no way shall be held to explain, modify or aid in
the interpretation, construction or meaning of the provisions of this Lease.
19.5. SEVERABILITY
In the event that a court of competent jurisdiction holds that a
particular provision or requirement of this Lease is in violation of any
applicable
16
109
law, each such provision or requirement shall be enforced only to the extent it
is not in violation of such law or is not otherwise unenforceable and all other
provisions and requirements of this Lease shall remain in full force and effect.
19.6. MODIFICATION; WAIVER
This Lease shall not be modified or amended except by an
instrument in writing signed by Landlord and Tenant. No delay or failure on the
part of any party hereto in exercising any right, power, or privilege under this
Lease or any other instruments executed and delivered in connection with or
pursuant to this Lease, shall impair any such right, power, or privilege or be
construed as a waiver of any default hereunder or any acquiescence therein. No
single or partial exercise of any such right, power, or privilege shall preclude
the further exercise of such right, power, or privilege, or the exercise of any
other right, power, or privilege. No waiver shall be valid against any party
hereto unless made in writing and signed by the party against whom enforcement
of such waiver is sought and then only to the extent expressly specified
therein.
19.7. BENEFIT OF THIS LEASE
It is the explicit intention of the parties hereto that except as
set forth below no person or entity other than a party hereto is or shall be
entitled to bring any action to enforce any provision of this Lease against any
of the parties hereto, and that the covenants, undertakings, and agreements set
forth in this Lease shall be solely for the benefit of, and shall be enforceable
only by, the parties hereto or their respective successors and assigns as
permitted hereunder.
19.8. SIGNAGE ON LEASED PREMISES
Landlord shall, at its own expense, erect all exterior and interior
signage at the Leased Premises as approved by Tenant.
19.9. INDEPENDENT CONTRACTOR
Tenant shall lease and operate the Leased Premises as an
independent contractor, and shall not be considered an agent, employee of,
partner of or joint venturer with Landlord.
19.10. EXECUTION IN COUNTERPARTS
This Lease may be executed in counterparts, each of which shall
constitute an original hereof for all purposes.
17
110
IN WITNESS WHEREOF, each of the parties intending to be legally
bound has duly caused this Lease to be duly executed and delivered in its name
and on its behalf, as of the date first written above.
TENANT:
INTRACEL CANCER CENTER OF
PENNSYLVANIA, INC.
By:____________________________________
Name__:________________________________
Title:_________________________________
LANDLORD:
LEHIGH VALLEY HOSPITAL AND
HEALTH NETWORK
By:____________________________________
Name__:________________________________
Title:_________________________________
18
111
EXHIBIT H
DESCRIPTION OF CLEAN ROOM, AND
ADMINISTRATIVE AND STORAGE SPACE
SEE ATTACHED
112
[LAYOUT OF LEHIGH VALLEY HOSPITAL
DEPARTMENT OF SURGERY RESEARCH LABORATORY]
The Clean Room, and Administrative and Storage Space consists of all the area
within and including the dotted lines.
113
EXHIBIT I
FINAL MEDICAL DIRECTOR SERVICES AGREEMENT
This Final Medical Director Services Agreement (this "AGREEMENT") is
entered into as of ________________ __, ____, by and between Intracel Cancer
Center of Pennsylvania, Inc. a Delaware for-profit corporation ("ICC"), and
Lehigh Valley Hospital and Health Network, a Pennsylvania non-profit corporation
("LEHIGH") (each a "PARTY", and collectively "PARTIES").
WHEREAS, Intracel Corporation ("INTRACEL") and Lehigh have entered into
a Joint Venture Agreement dated as of December 11, 1998 (the "JOINT VENTURE
AGREEMENT") pursuant to which ICC was formed to operate a center for the
manufacture and provision of OncoVaxCL(R) ("ONCOVAX"), a product developed by
Intracel to be utilized in the treatment of colon cancer and other oncological
products as agreed to by Intracel and Lehigh;
WHEREAS, ICC and Lehigh have entered into a lease with the same
effective date as this Agreement (the "FINAL ONCOVAX CENTER LEASE") pursuant to
which ICC is leasing from Lehigh the necessary space and equipment to operate a
laboratory and support area in compliance with current Good Manufacturing
Practices to manufacture and provide OncoVax and other oncological products as
agreed to by Intracel and Lehigh (the "ONCOVAX CENTER");
WHEREAS, Xxxxxxx X. Xxxxxx, Xx., M.D. is a physician employed by Lehigh
Valley Physician Group, a Pennsylvania non-profit corporation and wholly-owned
subsidiary of Lehigh;
WHEREAS, Xxxxxxx X. Xxxxxx, Xx., M.D. serves as the Chair of Surgery for
Lehigh pursuant to an agreement between Lehigh Valley Physician Group and
Lehigh;
WHEREAS, ICC desires to obtain the services of Xxxxxxx X. Xxxxxx, Xx.,
M.D. ("MEDICAL DIRECTOR") or his designee on a part-time, independent contractor
basis from Lehigh for the provision of certain Medical Director services at the
OncoVax Center as set forth more fully in Section 1.1 ("SERVICES");
WHEREAS, pursuant to the Joint Venture Agreement, Lehigh has agreed to
provide the Services of the Medical Director on a part-time, independent
contractor basis to ICC for ICC's Service Fee (as defined below) to Lehigh; and
WHEREAS, the Parties desire to enter into this Agreement to set forth
the terms and conditions under which Lehigh will provide the Services to ICC,
and ICC will compensate Lehigh for such Services.
114
NOW, THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Parties agree as follows:
1. MEDICAL DIRECTOR SERVICES
1.1 GENERAL DESCRIPTION OF SERVICES
During the Term (as defined in Section 6), Lehigh shall provide the
Services to ICC through Medical Director or, as described in Section 1.9 below,
through Medical Director's designee. The Services shall include: (a) assisting
ICC in establishing and enhancing the OncoVax Center, including assisting with
the clinical design of the center and the establishment of protocols and
systems; and (b) serving the OncoVax Center once it is operational as a medical
director, including (1) participating in administrative meetings and performing
other administrative duties as requested by ICC, (2) recommending rules and
policies for the operation of the center, (3) serving as a liaison with Lehigh
and Lehigh physicians, and (4) assisting in the assessment of outcomes and other
clinical data with respect to OncoVax and other Intracel or ICC products.
Medical Director and Lehigh acknowledge and agree that, depending upon certain
development decisions and other circumstances, some details of Medical
Director's duties may change over time. This Agreement shall remain in effect
notwithstanding such changes. ICC agrees to discuss any such changes with
Medical Director and to consider his input in these decisions. No activities or
services performed by Medical Director pursuant to this Agreement shall
constitute the practice of medicine. Any evaluations, diagnoses, treatments,
procedures or other professional health care services furnished to patients by
Medical Director will be provided in his individual capacity as a practicing
physician or employee of Lehigh or other entity, and will not be provided by
Medical Director in his capacity as an independent contractor to ICC pursuant to
this Agreement.
1.2 BEST EFFORTS
Medical Director shall devote his best efforts to performing the
Services. In doing so, Medical Director shall use his full education, skills,
and professional energy, consistent with his training and experience, to advance
the business interests of Intracel. During the Term of this Agreement, Medical
Director shall not engage in any other activity or occupation for compensation,
or any non-compensated activity, that in Intracel's reasonable opinion is
competitive with or adverse to the interests of ICC, without the prior written
consent of Intracel. Notwithstanding the foregoing, nothing in this Section 1.2
or elsewhere in this Agreement shall prevent Medical Director, during the time
not required for the performance of the Services, from maintaining his
individual medical practice or performing his duties as the Chair of Surgery for
Lehigh or an employee of Lehigh Valley Physician Group.
2
115
1.3 HOURS AND RECORDS
Notwithstanding any other provision of this Agreement, Medical Director
shall not spend less than 15 hours per month or be required to spend more than
25 hours per month, on average, performing the Services. The Parties agree that
these minimum and maximum numbers are annual averages, and that Medical Director
may spend less than 15 hours or more than 25 hours in any particular month
depending on Intracel's needs and Medical Director's availability. Within ten
(10) days following the end of each calendar month during the Term of this
Agreement, Lehigh shall provide ICC with a record of time Medical Director spent
performing the Services in the previous month. Such accounting shall include the
dates on which Medical Director performed Services, a description of the
Services performed on each date, and the amount of time spent performing those
Services.
1.4 REPORTING TO INTRACEL
Lehigh and/or Medical Director shall notify ICC in writing within one
working day of the occurrence of any of the following: (a) Medical Director's
being notified that any written complaint or report concerning him has been
filed with the Pennsylvania state medical board or the National Practitioner
Data Bank; (b) Medical Director's being notified that any written complaint has
been filed against him, or any adverse action has been proposed (whether final
or not), at any hospital, other health care facility, health maintenance
organization, preferred provider organization, insurer or health plan,
professional review organization, professional association or governmental body;
(c) Medical Director's receiving a summons and complaint or a subpoena relating
to his professional practice; (d) Medical Director's being charged with any
crime (excluding minor traffic violations); (e) any other event which reasonably
might be anticipated to expose ICC to a legal claim or adverse publicity, or
interfere with Medical Director's discharging his responsibilities under this
Agreement; or (f) any other disciplinary or professional liability actions
initiated against Medical Director. Medical Director acknowledges and agrees
that ICC may inform malpractice carriers or other appropriate parties of any
such occurrence.
1.5 COMPLIANCE WITH LAW
Lehigh and Medical Director shall perform the Services faithfully,
diligently, ethically, in a professional manner and in accordance with all
applicable laws, regulations and currently recognized professional standards.
1.6 COMPLIANCE WITH ICC AND INTRACEL RULES
Lehigh and Medical Director shall comply in all material respects with
the reasonable rules and policies of ICC, Intracel and the OncoVax Center, as
they now exist or as they may from time to time be amended, including rules and
policies
3
116
governing the provision of services, billing, records, and relationships with
OncoVax Center employees.
1.7 COOPERATION IN PROCEEDINGS
During and after the Term (and notwithstanding expiration or termination
of this Agreement for whatever reason), Lehigh and Medical Director shall,
without additional compensation, provide all reasonable assistance requested by
ICC in order to (a) assert ICC's rights under any insurance policies; or (b)
assist ICC in defense of professional liability or other actions.
1.8 PROFESSIONAL LIABILITY INSURANCE
Lehigh covenants that the Medical Director shall at all times during the
Term be covered by professional liability insurance that meets all requirements
of the Pennsylvania Healthcare Malpractice Act, as amended, and that such
coverage will be provided at Lehigh's cost.
1.9 MEDICAL DIRECTOR'S DESIGNEE
The Parties agree that Medical Director may delegate the provision of
Services to a designee, which designee shall be Xxxxx Xxxxxxx, M.D. unless the
Parties mutually agree on another designee. Notwithstanding anything in Section
1.3 to the contrary, Medical Director's designee shall devote a minimum of fifty
percent (50%) of her professional time to the performance of the Services. In
the event of such delegation, Medical Director's designee shall be subject to
all the terms and conditions under this Agreement which are applicable to
Medical Director as if a reference to such designee was expressly set forth in
each provision applicable to Medical Director. Any breach of any term or
condition as applied to any designee shall be a breach thereof in the same
manner as if applied to Medical Director himself.
2. REPRESENTATION AND WARRANTIES OF LEHIGH
2.1 GENERAL REPRESENTATIONS AND WARRANTIES
Lehigh hereby represents and warrants that (a) Medical Director
possesses and throughout the Term shall maintain, a current, valid, and
unencumbered license to practice medicine in the State of Pennsylvania; (b)
Medical Director either (1) is not subject to any actual or threatened
investigation, disciplinary proceeding, ethics action, public or private suit or
claim as to malpractice or professional misconduct, and his performance in his
job functions is not impaired due to a physical or mental condition or substance
abuse, or (2) as to any such matter to which Medical Director is subject, full
information has been disclosed in writing to Intracel; (c) Medical
4
117
Director either (1) knows of no existing circumstances that would provide a
basis for revoking or suspending his medical license, or subjecting him to suit,
or which would be harmful to ICC in engaging Medical Director, or (2) has
disclosed the same in writing to ICC; (d) Medical Director has adequate
malpractice "occurrence" coverage or "tail" coverage under existing insurance
with limits of liability of not less than $1 million per occurrence and $3
million in the aggregate, covering any claims relating to activities in his
private medical practice, and Lehigh shall indemnify and hold harmless ICC from
and against any claims, costs or expenses arising from such activities; and (e)
execution and performance of this Agreement does not violate any contract,
agreement, regulatory ruling or judicial order to which Lehigh or Medical
Director is subject (including both the Medical Director's employment agreement
and Lehigh's agreement with Lehigh Valley Physician Group), or to the best of
Lehigh's knowledge, violate any law.
2.2 EFFECT OF INACCURATE REPRESENTATIONS OR WARRANTIES
The Parties acknowledge and agree that if any representation or warranty
contained in this Section 2 is untrue or becomes untrue during the Term of this
Agreement, such untrue representation or warranty shall be deemed to be a
material misrepresentation by Medical Director and ICC shall have the right to
terminate this Agreement pursuant to Section 6.
3. RESPONSIBILITIES OF INTRACEL
3.1 ICC FACILITIES
Throughout the Term of this Agreement, ICC shall provide clerical and
other administrative support, to the extent ICC deems reasonable, to help
facilitate Medical Director's performance of the Services.
3.2 BUSINESS AND PROPERTY LIABILITY INSURANCE
ICC shall maintain general business and property liability insurance for
claims arising from (a) the occupancy of ICC offices by Medical Director; and
(b) the performance by Medical Director of the Services in accordance with the
terms of this Agreement.
4. REPRESENTATIONS AND WARRANTIES OF INTRACEL
ICC hereby represents and warrants that (a) it is a corporation duly
organized and validly existing; (b) this Agreement has been duly executed on
behalf of ICC; (c) this Agreement is a legal, valid and binding obligation of
ICC; and (d) execution and performance of this Agreement does not violate any
contract, agreement,
5
118
regulatory ruling, or judicial order to which ICC is subject, or to the best of
ICC's knowledge, violate any law.
5. PAYMENT FOR SERVICES
5.1 SERVICE FEE
In return for the Services, ICC shall pay to Lehigh a monthly service
fee ("SERVICE FEE") payable in arrears at the end of each month during the Term.
The Service Fee shall be [$6,250] per month, which the Parties agree reflects
the fair market value for the Services.
5.2 EXPENSES
Subject to reasonable ICC policies, including advance approval by ICC,
and up to the reasonable dollar limits specified from time to time by ICC,
Lehigh shall be entitled to reimbursement by ICC for reasonable expenses
(including but not limited to reasonable travel expenses) incurred by Medical
Director during the Term of this Agreement in performance of the Services and
upon the presentation of appropriate documentation. It is intended that all
expenses incurred pursuant to this Section 5.2 are to be ordinary and necessary
business expenses. It is therefore agreed that if any expense paid for, or
reimbursed to, Lehigh is disallowed by the Internal Revenue Service as a federal
income tax deduction of ICC, (1) ICC shall not be obliged to contest such
ruling, and (2) Lehigh shall reimburse ICC for such disallowed expense within
sixty (60) days after the final determination of such disallowance.
6. TERM AND TERMINATION
6.1 TERM
The term of this Agreement (the "TERM") shall commence on the Final
Closing Date as that term is defined in the Joint Venture Agreement (the
"EFFECTIVE DATE") and shall end on the one year anniversary date after the Final
Closing Date, unless earlier terminated in accordance with this Section 6. At
least 60 days prior to the end of the Term, the parties agree to negotiate in
good faith the terms for the renewal of this Agreement. Such renewed agreement
shall be substantially in the form of this Agreement, but will reflect, among
other things, any changes (a) in the applicable laws and (b) in the fair market
value of the Services provided.
6
119
6.2 TERMINATION BY INTRACEL
ICC may terminate this Agreement for Cause at any time during the Term
of this Agreement by giving Lehigh written notice at least thirty (30) days in
advance (the "NOTICE PERIOD") of the effective date of such termination (the
"TERMINATION DATE"). ICC may (without alteration of payment obligations under
this Agreement during the Notice Period) require that Medical Director cease his
performance of the Services at any time during the Notice Period. The following
shall be Cause for termination pursuant to this Section 6.2: (i) Lehigh itself,
or through Medical Director, breaches or fails to perform a material obligation
under this Agreement and that breach or failure is not cured to the reasonable
satisfaction of ICC within the Notice Period; (ii) any act or omission
constituting fraud or material misrepresentation by Lehigh or Medical Director
in dealing with ICC or the OncoVax Center; (iii) Medical Director's license to
practice medicine is suspended, limited or revoked, irrespective of other
proceedings, or Medical Director's DEA license to prescribe controlled
substances is revoked, limited or suspended; (iv) Medical Director is suspended
or barred from participation in Medicare; (v) Xxxxxxx X. Xxxxxx, Xx. is no
longer the Medical Director performing the Services on behalf of Lehigh, or he
becomes disabled to the extent that he is unable to perform the Services; (vi)
Medical Director becomes ineligible for professional liability coverage on
commercially reasonable terms; (vii) Lehigh is adjudged insolvent or bankrupt or
makes a general assignment for the benefit of creditors; or (viii) Medical
Director is convicted of a crime bearing on the practice of medicine, any crime
involving moral turpitude or fraud, or Medical Director is convicted of any
felony.
6.3 TERMINATION BY LEHIGH
Lehigh may terminate this Agreement for Cause at any time during the
Term of the Agreement by giving ICC written notice at least thirty (30) days in
advance (the "NOTICE PERIOD") of the effective date of such termination (the
"TERMINATION DATE"). The following shall be Cause for termination pursuant to
this Section 6.3: (i) ICC becomes insolvent or bankrupt or makes a general
assignment for the benefit of creditors; (ii) ICC breaches or fails to perform
any material obligation under this Agreement, and such breach or failure is not
cured to the reasonable satisfaction of Lehigh within the Notice Period; or
(iii) ICC commits fraud or material misrepresentation in its dealings with
Lehigh or Medical Director.
6.4 TERMINATION BY EVENT
Unless the Parties agree in writing to continue this Agreement, this
Agreement shall automatically terminate upon the occurrence, at any time, of any
of the following events: (i) the termination for any reason of the Joint Venture
Agreement (other than expiration of that Agreement coupled with the
effectiveness and continued effectiveness of the Operations Agreement as defined
in Section 9 of the Joint Venture Agreement); (ii) the termination for any
reason of the Operations
7
120
Agreement; (iii) the dissolution of ICC for any reason; or (iv) in accordance
with and only in accordance with the provisions of Section 8.5, in the event
this Agreement is deemed in the reasonable opinion of either Party to violate
law and be incapable of amendment.
6.5 TERMINATION OF MEDICAL DIRECTOR OR DESIGNEE BY INTRACEL
The Parties agree that pursuant to Section 9.1 of the Joint
Venture Agreement Intracel shall have the right to require that Medical Director
or any of his designees cease his or her performance of the Services at any time
during the Term of this Agreement if Medical Director or his designee fails to
comply with any or all applicable laws, rules and regulations.
6.6 COOPERATION
In the event of the expiration or termination of this Agreement for any
reason, Lehigh and Medical Director shall, without further compensation, if so
requested by ICC, thereafter, promptly (a) respond to requests for information
as reasonably may be necessary to ensure appropriate transfer of their
responsibilities; and (b) advise ICC if either receives a complaint, summons,
subpoena, or similar court order for records or testimony relating to
performance of the Services.
7. CONFIDENTIALITY
7.1 CONFIDENTIALITY
During the course of Lehigh's performance of the Services, Lehigh and/or
Medical Director may come to know certain confidential and proprietary business
or medical information of or about ICC, Intracel, the OncoVax Center, and/or ICC
or Intracel affiliates and joint venture partners (collectively, "ENTITIES"),
including but not limited to information concerning (a) business, affairs or
operations of the Entities or their customers, (b) Entity trade secrets, new
product developments, special or unique processes, protocols, or methods, (c)
Entity marketing, sales, advertising or other concepts or plans, (d) Entity fees
and billing arrangements, (e) Entity finances, (f) Entity management systems, or
(g) Entity business plans or prospects ("CONFIDENTIAL INFORMATION"). The term
"Confidential Information" shall exclude any information that is a matter of
public knowledge (except if such public knowledge resulted from an improper act
of Medical Director or Lehigh). Lehigh agrees that both during the Term of this
Agreement and after the expiration or termination of this Agreement for whatever
reason, Lehigh shall hold all such Confidential Information in the strictest
confidence, and shall not disclose, use, display, transfer, sell, publish, or
otherwise make available to any other person or entity, any such Confidential
Information without the prior written consent of ICC or Intracel as the case may
be, except as may be specifically required by law. Lehigh
8
121
shall protect such Confidential Information in a manner consistent with the
usual manner in which the most confidential business and professional
information is protected. Lehigh shall ensure that Medical Director complies
with the provisions of this Section 7.1.
7.2 ENFORCEMENT OF CONFIDENTIALITY REQUIREMENTS
Lehigh agrees that the restrictions contained in Section 7.1 are
part of the consideration for inducing ICC to contract with Lehigh to provide
the Services for the fees provided for in this Agreement; that such restrictions
are reasonable and necessary to protect the business interests of ICC, Intracel
and the OncoVax Center; and that any violation of such restrictions will cause
substantial and irreparable injury to ICC, Intracel and/or the OncoVax Center.
These restrictions shall be effective and enforceable upon the execution of this
Agreement by Lehigh, irrespective of the length of its Term. The Parties agree
that ICC, Intracel and the OncoVax Center each are entitled, in addition to any
and all other remedies available at law or in equity, to a restraining order,
preliminary and permanent injunctive relief and specific performance to prevent
a breach or contemplated breach of these restrictions, without the necessity of
proving actual damages. In the event of a breach of these provisions, Lehigh
shall be obligated to pay all costs and expenses, including reasonable
attorneys' fees, incurred by ICC, Intracel or the OncoVax Center due to such
breach or threatened breach.
7.3 NO ACQUIRED INTERESTS
Lehigh and Medical Director agree that upon termination or expiration of
this Agreement, all proprietary interest of ICC, Intracel or the OncoVax Center
in OncoVax or each of its other products, in customer accounts, lists,
copyrighted items, trade secrets, proprietary information, including all
intellectual property rights in any materials, documents, protocols, systems,
reports, or inventions, and all business assets, tangible or intangible
(collectively "PROPRIETARY INTERESTS"), with which Lehigh or Medical Director
deals or has access to, or that are developed or improved in whole or in part by
Lehigh or Medical Director in performing the Services during the Term of this
Agreement, shall remain the sole and exclusive property of ICC, Intracel and/or
the OncoVax Center, and in no event shall Lehigh or Medical Director, by virtue
of performing the Services, acquire any personal interest in the Proprietary
Interests or any right to use the Proprietary Interests except as specifically
set forth in a license agreement or other agreement executed by the Parties.
Lehigh and Medical Director each hereby assign to ICC all of Lehigh's or Medical
Director's right, title and interest, including all intellectual property
rights, if any, in any Proprietary Interests developed in whole or in part by
Lehigh or by Medical Director in performance of the Services, which Proprietary
Interests all shall be considered works made for hire. Lehigh and Medical
Director agree that upon termination or expiration of this Agreement each shall
promptly return to ICC all
9
122
business, corporate, medical or financial records, documents, forms, contracts,
lists and completed work or work in progress relating to the affairs of ICC,
Intracel or the OncoVax Center and any personal property of ICC or the
OncoVax Center in their possession at the time of termination or expiration.
8. GENERAL PROVISIONS
8.1 NOTICES
All notices and other communications under this Agreement shall be in
writing and shall be deemed given when delivered personally, sent by federal
express or other recognized overnight delivery service or mailed by registered
or certified mail, return receipt requested, to the Parties as follows or to
such other addressee as a party may in writing designate.
If to Lehigh:
Lehigh Valley Hospital and Health Network
Xxxxx Xxxxx & X-00
X.X. Xxx 000
Xxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attn: Xxxxx X. Xxxxxxxxx
Facsimile: (000) 000-0000
with a copy to:
Xxxxxxx, Hudders & Xxxxxxxxxx
The Paragon Centre
0000 Xxxx Xxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attn: Xxxxxxx X. Xxxxxxxxxx, Esq.
Facsimile: (000) 000-0000
If to ICC or OncoVax Center, to:
Intracel Cancer Center of Pennsylvania, Inc.
_____________________________________________
_____________________________________________
_____________________________________________
10
123
with a copy to:
Xxxxx Xxxxxxx, Esq.
Xxxxx & Xxxxxxx L.L.P.
000 00xx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
Each notice, demand, request or communication that shall be given or
made in the manner described in this Section 8.1 shall be deemed sufficiently
given or made for all purposes at such time as it is delivered to the addressee
(with the return receipt, the delivery receipt, or the affidavit of messenger
being deemed conclusive but not exclusive evidence of such delivery) or at such
time as delivery is refused by the addressee upon presentation. This Section 8.1
shall survive termination of this Agreement.
8.2 ENTIRE AGREEMENT; AMENDMENTS
This Agreement sets forth the entire understanding and agreement between
the parties with respect to the subject matter of this Agreement, and supersedes
all prior undertakings of any kind, whether written or oral. No terms,
conditions, or warranties, other than those contained in this Agreement, and no
amendments or modifications to this Agreement, shall be valid unless made in
writing and signed by the Parties.
8.3 EFFECT AND BENEFIT OF AGREEMENT
This Agreement shall be binding upon and inure to the benefit of the
Parties and their respective successors and permitted assigns. The covenants,
undertakings, and agreements set forth in this Agreement shall be solely for the
benefit of, and shall be enforceable only by, the Parties and their permitted
assigns, respective heirs, successors or legal representatives. Nothing in this
Agreement is intended to or shall be construed to, confer upon any person or
entity not a Party to this Agreement, any rights or benefits under this
Agreement. Notwithstanding the foregoing, Intracel shall be a third party
beneficiary hereto with respect to the enforcement of, and only to the extent
of, any rights it may have hereunder.
8.4 ASSIGNMENT
This Agreement and its performance shall not be assigned, sublet,
delegated or transferred by either Party in whole or in part without the prior
written consent of the other party, except that ICC shall have the right to
assign or delegate its rights and responsibilities under this Agreement, in
whole or in part, without Lehigh's consent, to the OncoVax Center (or a
successor entity) or to any affiliate or subsidiary of, or successor entity to,
Intracel.
11
124
8.5 INVALID PROVISIONS
If any provision of this Agreement or other document contemplated in
this Agreement is held to be illegal, invalid, or unenforceable under present or
future laws, such provisions shall be fully severable: (a) the appropriate
documents shall be construed and enforced as if such illegal, invalid, or
unenforceable provision had never comprised a part of the Agreement; (b) the
remaining provisions shall remain in full force and effect and shall not be
affected by the illegal, invalid or unenforceable provision; and (c) the Parties
shall in good faith negotiate and substitute a provision as similar in terms to
such illegal, invalid, or unenforceable provision as may be possible and still
be legal, valid and enforceable, unless the effect of such severance and
substitution would be to deprive a Party substantially of the benefits
contemplated under this Agreement, in which case either Party may terminate this
Agreement upon thirty days written notice to the other Party.
8.6 INDEPENDENT CONTRACTORS
The Parties acknowledge and agree that, with respect to this Agreement
and the arrangements set forth in this Agreement, they are independent
contractors and that except as provided in this Agreement, neither Party has the
right to obligate or bind the other Party in any manner whatsoever. Nothing in
this Agreement shall be interpreted, or is intended, to constitute either Party
as the employee or employer, joint venturer, or partner of the other Party. The
Parties understand and agree that (a) ICC will not withhold on behalf of Medical
Director any sum for income tax, unemployment insurance, social security or any
other withholding applicable to employees, and ICC will not provide Medical
Director with any of the benefits provided to employees of ICC or its
affiliates; (b) as between ICC and Lehigh, all such payments, withholdings and
benefits, if any, shall be the sole responsibility of Lehigh; and (c) Lehigh
will indemnify and hold ICC harmless from any and all loss or liability, cost or
expense arising with respect to any such payments, withholds, and benefits.
8.7 ACCESS TO BOOKS AND RECORDS
Until the expiration of six (6) years after expiration or termination of
this Agreement, ICC and Medical Director each shall make available to the
Secretary, U.S. Department of Health and Human Services, the U.S. Comptroller
General and their representatives, this Agreement and all books, documents and
records necessary to certify the nature and extent of the costs of the services
furnished hereunder and will provide such additional documentation as they
reasonably require. If Medical Director carries out any of the duties of this
Agreement through a subcontract worth ten thousand dollars ($10,000) or more
over a twelve month period with a related organization, the subcontract will
also contain a clause to permit access by the Secretary, Comptroller General,
and their representatives to
12
125
the related organization's books and records. This Section 8.7 shall survive
termination of this Agreement.
8.8 REMEDIES
Any remedies the Parties may have pursuant to this Agreement or by law
shall be cumulative.
8.9 NO WAIVER
The waiver by either Party of any breach of any provision of this
Agreement shall not be construed as a waiver of any subsequent breach of the
same or another provision. The failure to exercise any right under this
Agreement shall not operate as a waiver of such right. Any waiver must be in
writing and signed by the Party to be charged.
8.10 GOVERNING LAW
This Agreement, to the extent any particular issue is controlled by
state law, shall be governed by and construed in accordance with the laws of the
State of Maryland (but not including choice of law rules thereof).
8.11 COUNTERPARTS
This Agreement may be executed in two or more counterparts, each
of which shall be deemed an original, but which together shall constitute one
and the same Agreement.
13
126
IN WITNESS WHEREOF, each of the Parties intending to be legally
bound has caused this Agreement to be duly executed and delivered in its name
and on its behalf as of the date first set forth above.
INTRACEL CANCER CENTER OF
PENNSYLVANIA, INC.
By:__________________________________________
Name:
Title:
LEHIGH VALLEY HOSPITAL AND HEALTH NETWORK
By:__________________________________________
Name:
Title:
ACKNOWLEDGED AND AGREED:
XXXXXXX X. XXXXXX, XX., M.D.
By:__________________________________________
ACKNOWLEDGED AND AGREED:
XXXXX XXXXXXX, M.D.
By:__________________________________________
14
127
EXHIBIT J
DESCRIPTION OF CLEAN ROOM EQUIPMENT
EQUIPMENT NAME MANUFACTURER MODEL # SERIAL #
--------------------------------------- ---------------------- ---------------- --------------
Bio Safety Hood, 4' Xxxxx SG400 58432
Bio Safety Hood, 6' Xxxxx SG600 58388
Bio Safety Hood, 6' Xxxxx SG601 58382
Gammacell Irradiator Nordion 1000A 247
Controlled Rate Freezer Xxxxxxxxx 7009 06911-0497
Freezer Chamber Xxxxxxxxx 8753 06911-0497
MVE-TEC 2000 Storage MVE XLC-500F CDRA97B101
Incubator, CO2 Sanyo MCO-17AI 60905781
Incubator, CO2 Sanyo MCO-17AI 60905783
Ultralow Freezer Sanyo MDF-U6088SC 61006995
Water Bath, 1 of 2 Precision 180 697050163
Water Bath, 2 of 2 Precision 180 697030900
Refrigerator/Freezer Kenmore 363-9662825 L70640925
Chemical Fume Hood Kewaunee H05 R106417
Balance Xxxxxxxxx De410-D 73866
Microscope Nikon Labophot-2 462566
Refrigerator, undercounter Kenmore 564.9936111 961003215
Refrigerator, undercounter Kenmore 564.9936111 960901790
Immersible Stirrer VWR 230 0094
Immersible Stirrer VWR 230 0066
Immersible Stirrer VWR 230 0086
Immersible Stirrer VWR 230 0092
Pipetman Rainin P-1000
Pipetman Rainin P-200
Pipetman Rainin P-200
Pipetman Rainin P-200
Magnahelic Gauge Sure Flow
Magnahelic Gauge Sure Flow
Megafuge 1.0R Hereaus 75003062/02 232331
Calibrated Timer VWR
4 Work Stations with Divider Panels
3 Two Drawer Lateral Files
4 Office Chairs
5 Lab Chairs
Six door locker
2 two drawer file cabinets
1 Four Drawer File Cabinet
1 Six Drawer Lateral File Cabinet
3 Four Drawer File Cabinets
Computer Workstation with Printer
Fax Machine Murata
128
EXHIBIT K
THIS CONVERTIBLE PROMISSORY NOTE MAY NOT BE TRANSFERRED, SOLD, ASSIGNED,
PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF EXCEPT (A) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
AND THE RULES AND REGULATIONS IN EFFECT THEREUNDER (THE "ACT"), AND ALL
APPLICABLE STATE SECURITIES LAWS, OR (B) PURSUANT TO AN AVAILABLE EXEMPTION FROM
REGISTRATION UNDER, OR OTHERWISE IN COMPLIANCE WITH, THE ACT AND ALL APPLICABLE
STATE SECURITIES LAWS.
CONVERTIBLE PROMISSORY NOTE
$______________ ______________, 19__
FOR VALUE RECEIVED, the undersigned, Intracel Corporation, a
Delaware corporation ("INTRACEL"), hereby promises to pay to the order of Lehigh
Valley Hospital and Health Network, a Pennsylvania non-profit corporation
("HOLDER"), the sum of ______________________ and __/100 Dollars ($________), in
lawful money of the United States, same-day funds (the "PRINCIPAL SUM") from the
date hereof until paid in full at the rate and in the manner set forth below
together with interest on the principal balance thereof at the rate and in the
manner hereinafter provided.
This Note is secured by the collateral described in that certain
Security Agreement of even date herewith, by and between Intracel and the Holder
(the "SECURITY AGREEMENT"). The Holder is entitled to the benefits of the
Security Agreement and reference is made thereto for a description of the
collateral and the rights and remedies of the Holder thereunder. Neither the
reference to the Security Agreement nor any provision thereof, shall affect or
impair the absolute and unconditional obligation of the Company to pay the
Principal Sum hereof, together with interest accrued thereon, when due.
The Principal Sum shall be due and payable on _________ __, 20__,
(the "MATURITY DATE") when the outstanding principal balance, if any, together
with accrued interest and any other amounts payable hereunder shall be due and
payable in full.
129
Interest on the unpaid Principal Sum shall begin to accrue on the
Commencement Date and shall continue to accrue at an annual rate equal to the
"Prime Rate" as published from time to time in THE WALL STREET JOURNAL listing
of "Money Rates", and shall be the highest such rate if more than one is quoted.
If this index ceases to be published in THE WALL STREET JOURNAL, an alternate
index of similar nature will be selected. All computations of interest shall be
made by the Holder on the basis of a year of 360 days for the actual number of
days (including the first day but excluding the last day) occurring in the
period for which such interest is payable.
Whenever any payment hereunder shall be stated to be due on a day
other than a day on which full-service commercial banks are generally open for
business in the State of Maryland (a "BUSINESS DAY"), such payment shall be made
on the next succeeding Business Day, and such extension of time shall in such
case be included in the computation of payment of interest.
All payments hereunder shall be made to Holder at _____________________
_______________________________ or at such other address as the Holder may from
time to time designate in writing to Intracel.
Commencing on the first business day after the date Intracel's
common stock, par value $.0001 per share ("COMMON STOCK") is listed or admitted
for trading on a national securities exchange, Holder may elect to convert all
or a portion of the outstanding Principal Sum and accrued interest due
hereunder, in even increments of Fifty Thousand and No/100 Dollars ($50,000.00),
into the number of shares of Common Stock derived by dividing (a) such
outstanding Principal Sum to be converted hereunder by (b) the Conversion Price
then in effect. For purposes of this Note, Conversion Price shall mean the last
sale price, regular way, of the shares of the Common Stock on the Business Day
immediately preceding the date Holder notifies Intracel of its election to
convert all or a portion of the Principal Sum into Common Stock (the "PRICING
DATE") or, in case no such sale takes place on the Pricing Date, the average of
the closing bid and asked prices of the shares of the Common Stock, regular way,
in either case as reported in the principal consolidated transaction reporting
system with respect to securities listed or admitted to trading on the New York
Stock Exchange, or, if the shares of the Common Stock are not listed or admitted
to trading on the New York Stock Exchange, as reported in the principal
consolidated transaction reporting system with respect to securities listed on
the principal national securities exchange on which shares of the Common Stock
are listed or admitted to trading; provided, however, that the Conversion Price
shall in no event be an amount be less than [seventy-five percent (75%) of the
per share initial public offering price of the Common Stock]. If shares of
Common Stock are not publicly held or so listed or publicly traded, the
Conversion Price shall be an amount determined in good faith by the Intracel
Board of Directors as the fair market value of a share of Common Stock which
determination shall be final, binding and conclusive. Holder may
-2-
130
exercise its right to convert all or a portion of the Principal Sum under this
Note only once during each calendar quarter during the term of this Note.
Intracel shall at all times reserve and keep available for
issuance upon the conversion of this Note, free from any preemptive rights, such
number of its authorized but unissued shares of Common Stock as will from time
to time be sufficient to permit the conversion of the entire outstanding
Principal Sum of this Note into shares of Common Stock, and shall take all
action required to authorize a sufficient number of shares of Common Stock
necessary to permit the conversion, at any time, of the outstanding Principal
Sum of this Note, plus accrued but unpaid interest due thereon.
Any one of the following events constitutes an event of default
("EVENT OF DEFAULT") under this Note: (a) failure of Intracel to make any
payment of the Principal Sum or interest when due and such failure continues for
five days after written notice of such default by Holder; (b) failure of
Intracel to perform, observe, or comply with any provisions of this Note; (c)
filing by Intracel of any petition for relief under the Bankruptcy Code or any
similar federal or state statute or service upon Intracel of any petition for
relief under the Bankruptcy Code or under any federal or state bankruptcy,
reorganization, arrangement, insolvency, receivership, or similar law, if that
petition is not dismissed within 30 days after service upon Intracel.
Upon the occurrence of any Event of Default, Holder may, at its
option, declare the entire unpaid balance of the Principal Sum, together with
all accrued and unpaid interest, to become immediately due and payable. Holder's
failure to exercise this option upon an Event of Default, however, does not
constitute a waiver of Holder's right to exercise this option in the event of a
subsequent Event of Default. Holder shall have no duty to exercise any or all of
the rights and remedies herein provided or contemplated. Holder's acceptance of
any payment hereunder that is less than payment in full of all amounts due and
payable at the time of such payment shall not constitute a waiver of the right
to exercise any of the foregoing options at that time or at any subsequent time,
or nullify any prior exercise of any such option without Holder's express
written consent. Intracel shall pay all costs incurred by Holder in the
collection or enforcement of this Note, whether or not suit is filed thereon,
including reasonable attorneys' fees.
This Note shall be governed by and construed according to the
laws of the State of Maryland, without regard to principles of conflict of laws.
Intracel agrees that the extension of credit evidenced by this
Note shall be used by Intracel solely in furtherance of Intracel's commercial
business activities.
-3-
131
This Note shall be binding upon the successors and assigns of
Intracel and shall inure to the benefit of Holder, and its successors and
permitted assigns. This Note may not be assigned or transferred by Holder
without the prior written consent of the Intracel, which consent shall not be
unreasonably withheld.
If any term or provision of this Note shall be held invalid,
illegal or unenforceable, in whole or in part, neither the validity of the
remaining part of such term or provision, nor the validity of the remaining
terms of this Note shall in any way be affected thereby.
Intracel hereby waives any right to a trial by jury in connection
with any suit brought under this Note by Holder. This Note arises out of that
certain Xxxx of Sale, by and between Intracel and Holder, dated of even date
herewith.
INTRACEL CORPORATION
By:_________________________________
Name:_______________________________
Title:______________________________
-4-
132
EXHIBIT L
SECURITY AGREEMENT
THIS SECURITY AGREEMENT is entered into as of this _______ day
of ____________, 19___, by and between Lehigh Valley Hospital and Health
Network, a Pennsylvania non-profit corporation with its principal office at
Cedar Crest & X-00, Xxxxxxxxx, XX ("SECURED PARTY"), and Intracel Corporation, a
Delaware corporation with its principal office at 1330 Piccard Drive, Rockville,
MD ("DEBTOR").
WHEREAS, Debtor has executed and delivered to the Secured Party
a convertible promissory note (the "NOTE") of even date herewith; and
WHEREAS, as a condition to the obligation of Secured Party to
accept the Note, Debtor is required to enter into this Security Agreement and to
grant to Secured Party a security interest in the Collateral (as hereinafter
defined).
NOW, THEREFORE, in consideration of the foregoing and of the
mutual covenants and agreements hereinafter set forth, the parties hereto agree
as follows:
1. SECURITY INTEREST
1.1. COLLATERAL
As security for the Secured Obligations, Debtor hereby grants to
Secured Party a Security Interest in and lien on, and assigns and pledges to
Secured Party, all of the following (the "COLLATERAL"):
(a) all of the equipment described in Exhibit A attached hereto,
which equipment will be located at _______________________________________
during the term hereof.
(b) any and all additions to any of the foregoing, and any and
all replacements, products and proceeds (including insurance proceeds) of any of
the foregoing.
1.2. RIGHT OF SECURED PARTY TO PAY TAXES OR COSTS RELATING TO
COLLATERAL
Secured Party shall have the right, but not the obligation, to
pay any taxes or levies on the Collateral or any costs to repair or to preserve
the
133
Collateral, which payment shall be made for the account of Debtor and shall
constitute a part of the Secured Obligations.
1.3. FINANCING STATEMENTS
At the request of Secured Party, Debtor will promptly join with
Secured Party in executing financing statements, continuation statements,
assignments, certificates and other documents with respect to the Collateral
pursuant to the Uniform Commercial Code and otherwise as may be necessary to
enable Secured Party to perfect or from time to time renew the Security
Interests granted hereby (including without limitation such financing
statements, continuation statements, certificates and other documents as may be
necessary to perfect a Security Interest in any additional property or rights
hereafter acquired by Debtor or in any replacements or proceeds thereof), in a
form satisfactory to Secured Party, and Debtor will pay the cost of filing the
same in all public offices wherever Secured Party deems filing to be necessary
or desirable. Debtor grants Secured Party the right, at Secured Party's option,
to file any or all such financing statements, continuation statements and other
documents pursuant to the Uniform Commercial Code and otherwise, without
Debtor's signature, and irrevocably appoints Secured Party as Debtor's attorney
in fact to execute any such statements and documents in Debtor's name and to
perform all other acts which Secured Party deems appropriate to perfect and
continue the Security Interests conferred by this Agreement.
1.4. INJURY TO COLLATERAL
No injury to, or loss or destruction of, the Collateral shall
relieve Debtor of any of the Secured Obligations.
2. REPRESENTATIONS AND WARRANTIES OF DEBTOR
Debtor hereby represents and warrants to the Secured Party that:
2.1. CORPORATE AUTHORITY
Debtor is a corporation duly incorporated, validly existing and
in good standing under the laws of the state of Delaware, and has all requisite
power and authority, corporate and otherwise, to own, operate and lease its
properties and to carry on its business as currently conducted, to execute and
deliver and perform this Agreement and any other instruments or agreements
executed in connection herewith, and to incur the obligations provided for
therein and to perform the transactions contemplated thereby (including without
limitation the creation of a first security interest in favor of Secured
Party in the Collateral), all of which have been duly and validly authorized by
all proper and necessary actions, all of which actions are in full force and
effect.
- 2 -
134
2.2. APPROVALS
No approval, consent or other action by the stockholders of
Debtor, by any governmental authority, or by any other person or entity, is or
will be necessary to permit the valid execution, delivery or performance by
Debtor of this Agreement or of any other instruments or agreements executed in
connection herewith.
2.3. BINDING EFFECT, NO VIOLATIONS
Debtor has duly authorized the execution, delivery and
performance of this Agreement and of all other instruments or agreements
executed in connection herewith, each of which, upon its execution and delivery,
will constitute a legal, valid and binding obligation of Debtor, enforceable
against Debtor in accordance with its terms. The execution, delivery, and
performance of this Agreement and of all other instruments or agreements
executed in connection herewith will not (a) violate, conflict with, or
constitute a default under any law, regulation, order or any other requirement
of any governmental authority or arbitrator, any terms of the Articles or
Certificate of Incorporation or bylaws of Debtor, or any contract, agreement or
other arrangement binding upon or affecting Debtor or any of its properties, (b)
result in the creation, imposition or acceleration of any indebtedness or any
mortgage, lien, reservation, covenant, restriction or other encumbrance (each of
the foregoing hereinafter referred to as an "ENCUMBRANCE") of any nature upon,
or with respect to, Debtor or any of its properties, (c) have a material adverse
effect on the conduct of Debtor's business as it is now being conducted and
proposed to be conducted while this Agreement is in effect, or (d) otherwise
impair the value of the Security Interests granted to Secured Party hereunder.
2.4. TITLE TO COLLATERAL
As of the date hereof, Debtor is the sole owner of, and has
good, valid and marketable title to, the Collateral, free from all Encumbrances
and Security Interests in favor of any person other than Secured Party, and has
full right and power to grant Secured Party a Security Interest therein. Upon
the execution and delivery of this Agreement, and upon the filing of financing
statements referred to in SECTION 1.3 hereof, Secured Party will have a good,
valid and perfected first lien and Security Interest in the Collateral, subject
to no liens, encumbrances and security interests in favor of any other person or
entity.
2.5. NO DEFAULT
No event which constitutes, or with notice, lapse of time or
other condition would constitute, an Event of Default has occurred or is
continuing. Debtor is not, to its knowledge, in default under any contract or
agreement, which default would have a material adverse effect on the business,
properties or
- 3 -
135
condition, financial or otherwise, of Debtor, or in default in the performance
of any representations, warranties, covenants or conditions respecting any of
its indebtedness, and no holder of any indebtedness of Debtor has given notice
of any asserted default thereunder, and no liquidation or dissolution of Debtor
and no receivership, insolvency, bankruptcy, reorganization or other similar
proceedings relative to the Debtor or its properties is pending or, to the
knowledge of Debtor, is threatened against it.
3. AFFIRMATIVE COVENANTS OF DEBTOR
Until all Secured Obligations of Debtor have been paid in full
and performed, Debtor hereby covenants that it shall, unless Secured Party
otherwise consents in advance in writing:
3.1. CORPORATE EXISTENCE AND BUSINESS CONDUCT
Preserve, maintain and keep in full force and effect its
corporate existence in the jurisdiction of its incorporation, and all rights,
franchises, and privileges necessary or desirable in the normal conduct of its
business; continue to engage in business of the same general type as now
conducted by it; and conduct such business in an orderly, efficient and regular
manner consistent with the conduct of its business prior to the date hereof.
3.2. TAXES, CHARGES, AND OBLIGATIONS
Pay and discharge, or cause to be paid and discharged, all
taxes, assessments and other governmental charges imposed upon the Collateral or
upon any part thereof, or for its use or operation, prior to the date on which
penalties attach thereto, as well as all lawful claims which, if unpaid, might
become an Encumbrance upon the Collateral, and pay, discharge or otherwise
satisfy at or before maturity or before they become delinquent, as the case may
be, all of the indebtedness and other obligations of whatever nature of Debtor;
provided that Debtor shall not be required to pay any such tax, assessment,
charge, levy, claim, indebtedness or obligation which is being contested in good
faith and by proper proceedings if Debtor sets aside on its books adequate
reserves therefor.
3.3. MAINTENANCE OF PROPERTY
Keep the property comprising the Collateral, or cause the
property comprising the Collateral to be kept, in good repair, working order and
condition, and from time to time make all necessary or desirable repairs,
renewals and replacements thereof.
- 4 -
136
3.4. INSURANCE
Maintain, or caused to be maintained, with financially sound and
reputable insurers acceptable to Secured Party, insurance with respect to the
Collateral against loss or damage of the kinds customarily insured against by
corporations of established reputation engaged in the same or similar business
and similarly situated, of such types and in such amounts as are customarily
carried under similar circumstances by such other corporations. Debtor shall
furnish to, or cause to be furnished to, Secured Party such certificates,
policies or endorsements evidencing such insurance as Secured Party may require,
and if Debtor fails to do so, Secured Party may obtain such insurance and charge
the cost thereof to Debtor's account and add it to Secured Obligations of
Debtor. All such insurance policies shall be in form and substance reasonably
satisfactory to Secured Party. Secured Party shall be named as an additional
insured on all such insurance policies. In the event of a casualty loss, the
proceeds of all such insurance policies shall be payable directly to Secured
Party and may be applied to the restoration or replacement of that portion of
the Collateral which was the subject of such loss or to payment of Secured
Obligations of Debtor, whether or not due, as Secured Party may direct. Debtor
shall give Secured Party immediate written notice of any and all loss or damage
to the Collateral, however occasioned.
3.5. CONTRACT OBLIGATIONS
Perform in accordance with its terms every contract, agreement,
or other arrangement to which Debtor is a party or by which it or any of the
Collateral is bound, except to the extent that Debtor is contesting the
provisions thereof in good faith and by proper proceedings, and the failure to
comply therewith does not and will not, in the aggregate, have a material
adverse effect on the business, operations, property, or condition (financial or
otherwise) of Debtor.
3.6. COMPLIANCE WITH LAWS
Comply with all applicable laws, regulations, orders, and other
requirements of any court, tribunal, arbitrator or governmental authority,
non-compliance with which could have a material adverse effect on the business,
operations, property or condition (financial or otherwise) of Debtor.
3.7. ACCESS TO DEBTOR'S EMPLOYEES, PROPERTIES, AND BOOKS AND RECORDS
Permit Secured Party and any agents or representatives thereof
to visit and inspect the Collateral to examine and make abstracts from any of
Debtor's books and records at any and all reasonable times and as often as
Secured Party or such agents or representatives may desire, and to discuss the
business, operations,
- 5 -
137
properties, and condition (financial or otherwise) of Debtor as they affect the
Collateral with any of the officers, directors, employees, agents or
representatives (including, without limitation, the independent certified public
accountants) of Debtor. Debtor will maintain such records and books of account
at the address indicated in SECTION 7.3, except that Debtor may relocate such
records and books of account if Debtor gives Secured Party at least thirty (30)
days' prior written notice of any change in the location of such records and
books of account.
3.8. COLLATERAL
Execute and deliver any and all documents, or cause the
execution and delivery of any and all documents, necessary for Secured Party to
create, perfect, preserve, validate or otherwise protect its Security Interest
in the Collateral; maintain, or cause to be maintained, at all times, Secured
Party's Security Interest in the Collateral; immediately upon learning thereof,
report to Secured Party any reclamation, return or repossession of goods, any
claim or dispute asserted by any debtor or other obligor of Debtor, and any
other matters affecting the value or enforceability or collectibility of any of
the Collateral; defend the Collateral against all claims and demands of all
persons at any time claiming the same or any interest therein adverse to Secured
Party and pay all costs and expenses (including attorneys' fees and expenses)
incurred in connection with such defense; and at Debtor's sole cost and expense
(including attorneys' fees and expenses), settle any and all such claims and
disputes and indemnify and protect Secured Party against any liability, loss or
expense arising therefrom or out of any such reclamation, return or repossession
of any of the Collateral, provided, however, if Secured Party shall so elect, it
shall have the right at all times to settle, compromise, adjust, or litigate all
claims or disputes directly with the debtor or other obligor of Debtor upon such
terms and conditions as Secured Party deems advisable, and to charge all costs
and expenses thereof (including attorneys' fees and expenses) to Debtor's
account and to add them to the Secured Obligations.
4. NEGATIVE COVENANTS OF DEBTOR
Until all Secured Obligations of Debtor are paid in full and performed,
Debtor hereby covenants and agrees that it shall not, unless Secured Party
otherwise consents in advance in writing:
4.1. ENCUMBRANCES
Directly or indirectly create, incur, assume, or permit to
continue in existence any mortgage, lien, charge or encumbrance on, or security
interest in, or pledge or deposit of, or conditional sale or other title
retention agreement with respect to the Collateral, except for:
- 6 -
138
(i) liens for taxes, assessments or governmental charges the
payment of which is not at the time required by SECTION 3.2;
(ii) statutory liens of landlords and liens of carriers,
warehousemen, mechanics and materialmen incurred in the ordinary course of
business for sums not yet due or being contested in good faith and by
appropriate proceedings promptly initiated and diligently conducted, for which
it has made such reserve or other appropriate provision, if any, as shall be
required by generally accepted accounting principles;
(iii) liens incurred or deposits made in the ordinary course of
business in connection with workmen's compensation, unemployment insurance and
other types of social security, or to secure the performance of tenders,
statutory obligations, surety and appeal bonds, bids, leases, performance and
return-of-money bonds and other similar obligations (exclusive of obligations
for the payment of borrowed money);
(iv) any attachment lien being contested in good faith and by
proceedings promptly initiated and diligently conducted, unless the attachment
giving rise thereto shall not, within sixty (60) days after the entry thereof,
have been discharged or fully funded or shall not have been discharged within
sixty (60) days after the termination of such bond;
(v) any judgment lien, unless the judgment it secures shall not,
within sixty (60) days after the entry thereof, have been discharged or
execution thereof stayed pending appeal, or shall not have been discharged
within sixty (60) days after the expiration of any such stay;
(vi) easements, rights-of-way, restrictions and other similar
charges or encumbrances incurred in the ordinary course of business and not
interfering with the ordinary conduct of the business of Debtor;
(vii) liens securing motor vehicle loans and leases provided
that any such lien shall at all times be confined to the motor vehicle or
vehicles being purchased with the proceeds of such indebtedness or leased;
(viii) liens which (a) secure loans for the purchase of
equipment other than equipment which is purchased to replace equipment
comprising the Collateral, (b) are confined to the equipment so purchased, and
(c) are incurred with the Secured Party's prior written consent, which consent
shall not be unreasonably withheld;
(ix) liens, charges, encumbrances and priority claims junior to
those of the Secured Party and which are incidental to the conduct of the
business of Debtor and the ownership of its properties and assets and incurred
in the ordinary course of Debtor's business; and
- 7 -
139
(x) mortgages, liens and security interests securing the payment
of the Secured Obligations.
4.2. LOCATION OF COLLATERAL
Change the location of any items of inventory or equipment from
the places of business where such items of Collateral are required to be located
by SECTION 1.1 hereof.
5. EVENTS OF DEFAULT
Debtor shall be in default under this Agreement upon the happening of
any of the following events or conditions ("EVENTS OF DEFAULT"):
5.1. FAILURE TO MAKE PAYMENT
Debtor shall fail to make any payment of principal or interest
on any of the Secured Obligations as and when the same shall become due and
payable (whether at maturity or at a date fixed by acceleration or otherwise),
and such failure continues for a period of twenty (20) Business Days, which for
purposes of this Agreement shall mean any day on which full-service commercial
banks are generally open for business in the State of Maryland (each, a
"BUSINESS DAY"), after Secured Party gives notice thereof to Debtor; or
5.2. REPRESENTATION AND WARRANTIES
Any representation or warranty of Debtor made herein shall prove
to have been incorrect or misleading or breached in any material respect on or
as of any date as of which made; or
5.3. OBSERVANCE OF COVENANTS
Debtor shall at any time fail to observe, satisfy or perform any
of the covenants or agreements contained in SECTION 3 or 4 hereof and such
default shall continue unremedied for a period of twenty (20) Business Days
after written notice of the existence of such default shall have been received
by Debtor from Secured Party; or
5.4. OBSERVANCE OF OTHER PROVISIONS
Debtor shall fail to observe or perform any other term, covenant
or agreement contained in this Agreement and such default shall continue
unremedied for a period of twenty (20) Business Days after written notice of
such default shall have been received by Debtor from Secured Party.
- 8 -
140
6. RIGHTS OF SECURED PARTY UPON OCCURRENCE OF EVENTS OF DEFAULT
6.1. MISCELLANEOUS RIGHTS OF SECURED PARTY
Upon the occurrence of any Event of Default, such Event of
Default not having been previously remedied or cured, Secured Party shall have
the right (a) to declare all of the Secured Obligations to be immediately due
and payable, whereupon all such Secured Obligations shall become immediately due
and payable without presentment, demand, protest or further notice of any kind,
all of which are hereby expressly waived by Borrower, anything contained herein
to the contrary notwithstanding; and/or (b) to exercise any one or more of the
rights and remedies exercisable by Secured Party under other provisions of this
Agreement or exercisable by a secured party under the Uniform Commercial Code as
in effect in Pennsylvania (subject to any rights of Debtor to redeem the
Collateral provided therein) or under any other applicable law.
6.2. RIGHT OF SECURED PARTY TO TAKE POSSESSION AND FORECLOSE
Upon the occurrence of any Event of Default, such default not
having previously been remedied or cured, Secured Party shall have the right,
subject to compliance with the requirements of SECTION 6.3, to take possession
of the Collateral and of any and all books of account and records of Debtor
relating to any of the Collateral, the right to place Secured Party's
representatives upon any premises on which the Collateral or any part thereof or
any such books of account or records may be situated with full power to remove
the same therefrom. Secured Party may require Debtor to assemble the Collateral
or any part thereof and to make the same (to the extent the same is moveable)
available to Secured Party at a place to be designated by the Secured Party
which is reasonably convenient to all parties. Secured Party may render the
Collateral or any part thereof unusable without removing the same from the
premises on which it may be situated, and may sell the same on the premises of
Debtor if such Collateral or part thereof is situated thereon. The Secured Party
will give the Debtor at least twenty (20) days' prior written notice of the time
and place of any public sale thereof or of the time after which any private sale
or any other intended disposition thereof is to be made, which notice shall
constitute reasonable notice. In addition to exercising the foregoing rights,
Secured Party may, to the extent permitted by law, arrange for and conduct the
sale of the Collateral at a public or private sale, as Secured Party may elect,
which sale may be conducted by an employee or representative of Secured Party,
and such sale shall be considered or deemed to be a sale in a commercially
reasonable manner. Secured Party may release, temporarily or otherwise, to
Debtor any item of Collateral of which Secured Party has taken possession
pursuant to any right granted to Secured Party by this Agreement without waiving
any rights granted to Secured Party under this SECTION 62.2.
- 9 -
141
Secured Party, in dealing with or disposing of the Collateral or any part
thereof, shall not be required to give priority or preference to any item of
Collateral or otherwise to xxxxxxxx assets.
6.3. RIGHT OF SECURED PARTY TO USE AND OPERATE COLLATERAL
Upon the Secured Party's taking possession of all or any part of
the Collateral, pursuant to any right granted Secured Party by this Agreement,
Secured Party shall have the right to hold, store, and/or use, operate, manage
and control the same. Upon any such taking of possession, Secured Party may,
from time to time, at the expense of Debtor, make all such repairs,
replacements, alterations, additions and improvements to and of all or any of
the Collateral as Secured Party may deem proper. In any such case Secured Party
shall have the right to exercise all rights and powers of Debtor in respect of
the Collateral or any part thereof as Secured Party shall deem best, including
the right to enter into any and all such agreements with respect to the leasing
and/or operation of the Collateral or any part thereof as Secured Party may see
fit; and Secured Party shall be entitled to collect and receive all rents,
issues, profits, fees, revenues and other income of the same and every part
thereof.
6.4. APPLICATION OF PROCEEDS
All dividends, interest, rents, issues, profits, fees, revenues,
income, and other proceeds from collecting, holding, managing, renting, selling,
or otherwise disposing of the Collateral or any part thereof shall be applied in
the following order of priority:
First, to the payment of all costs and expenses
of collecting, storing, leasing, holding, operating,
managing, selling or otherwise disposing of, or
delivering the Collateral or any part thereof or any
proceeds thereof and of conducting the Debtor's
business, and of maintenance, repairs, replacements,
alterations, additions and improvements of or to the
Collateral, and to the payment of all sums which Secured
Party may be required or may elect to pay, if any, for
taxes, assessments, insurance and other charges upon the
Collateral or any part thereof, and all other payments
which Secured Party may be required or authorized to
make under any provision of this Agreement (including in
each such case legal costs and attorneys' fees and
expenses and all expenses, liabilities and advances made
or incurred in connection therewith);
- 10 -
142
Second, to the payment of all Secured
Obligations;
Third, to the satisfaction of indebtedness
secured by any subordinate security interest of record
in the collateral if written notification of demand
therefor is received before distribution of the proceeds
is completed. If requested by Secured Party, the holder
of a subordinate security interest shall seasonably
furnish reasonable proof of his interest, and unless he
does so Secured Party need not comply with his demands;
and
Fourth, to the payment of any surplus then
remaining to Debtor, unless otherwise provided by law or
directed by a court of competent jurisdiction; provided
that Debtor shall be liable for any deficiency if such
proceeds are insufficient to satisfy the Secured
Obligations.
7. MISCELLANEOUS PROVISIONS
7.1. ADDITIONAL ACTIONS AND DOCUMENTS
Debtor hereby agrees to take or cause to be taken such further
actions, to execute, deliver and file or cause to be executed, delivered and
filed such further documents and instruments, and to obtain such consents, as
may be necessary or as may be reasonably requested in order to fully effectuate
the purposes, terms and conditions of this Agreement, whether before, at or
after the closing of transactions contemplated hereby or the occurrence of an
Event of Default hereunder.
7.2. EXPENSES
Debtor agrees, whether or not the transactions hereby
contemplated shall be consummated, to reimburse and save Secured Party harmless
against liability for the payment of all out-of-pocket expenses arising in
connection with the preparation, execution, delivery, administration, or
enforcement of, or the preservation or exercise of any rights (including the
right to collect and dispose of the Collateral) under this Agreement, including
without limitation the fees and expenses of counsel to Secured Party arising in
such connection.
- 11 -
143
7.3. NOTICES
All notices, demands, requests, or other communications which
may be or are required to be given, served or sent by any party to any other
party pursuant to this Agreement shall be in writing and shall be mailed by
first-class, registered or certified mail, return receipt requested, postage
prepaid, or transmitted by telegram, addressed as follows:
(a) If to Debtor:
Intracel Corporation
0000 Xxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxx
Facsimile: (000) 000-0000
with a copy (which shall not constitute notice) to:
Xxxxx & Xxxxxxx L.L.P.
000 00xx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000-0000
Attention: Xxxxx Xxxxxxx, Esq.
(b) If to Secured Party:
Lehigh Valley Hospital and Health Network
Cedar Crest & X-00
Xxxxxxxxx, XX
Attention: Xxxxx X. Xxxxxxxxx
Facsimile: (000) 000-0000
with a copy (which shall not constitute notice) to:
Xxxxxxx, Hudders & Xxxxxxxxxx
The Paragon Center
0000 Xxxx Xxxx, Xxxxx 000
Xxxxxxxxx, XX 00000-0000
Attention: Xxxxxxx X. Xxxxxxxxxx, Esq.
Facsimile: (000) 000-0000
Each party may designate by notice in writing a new address to which any notice,
demand, request or communication may thereafter be so given, served or sent.
Each notice, demand, request or communication which shall be mailed in the
manner described above, or which shall be delivered to a telegraph company,
shall be deemed sufficiently given, served, sent or received for all purposes at
such time as it is delivered to the addressee (with the return receipt or the
delivery receipt being deemed conclusive evidence of such delivery) or at such
time
- 12 -
144
as delivery is refused by the addressee upon presentation.
7.4. WAIVER BY SECURED PARTY
No waiver by Secured Party of, or consent by Secured Party to, a
variation from the requirements of any provision of this Agreement shall be
effective unless made in a written instrument duly executed on behalf of Secured
Party by its duly authorized officer, and any such waiver shall be limited
solely to those rights or conditions expressly waived.
7.5. RELEASE OF COLLATERAL
Promptly following performance and payment in full of the
Secured Obligations, the Security Interest created hereby shall terminate, and
Secured Party shall execute and deliver such documents, at Debtor's expense, as
are necessary to release Secured Party's Security Interest in the Collateral.
7.6. BENEFIT AND ASSIGNMENT
This Security Agreement shall be binding upon and shall inure to
the benefit of the parties hereto and their respective successors and assigns as
permitted hereunder. This Agreement may not be assigned by the Debtor without
the prior written consent of Secured Party. In the event of a sale or assignment
by Secured Party of all or any part of the interests in the Note, Secured Party
may assign and transfer its rights and interests under this Agreement in whole
or in part to the Purchaser or Purchasers of such interests in the Note,
whereupon such Purchaser or Purchasers shall become vested with all of the
powers and rights given to the Secured Party hereunder, and shall be deemed to
be a Secured Party for all purposes hereunder, and the predecessor Secured Party
shall thereafter be forever released and fully discharged from any liability or
responsibility hereunder with respect to the rights and interests so assigned.
7.7. SEVERABILITY
If fulfillment of any provision of this Agreement, or
performance of any transaction related hereto, at the time such fulfillment or
performance shall be due, shall involve transcending the limit of validity
prescribed by law, then the obligation to be fulfilled or performed shall be
reduced to the limit of such validity.
- 13 -
145
7.8. SURVIVAL
It is the express intention and agreement of the parties hereto
that all covenants and agreements, statements, representations, warranties and
indemnities made by Debtor shall survive the execution and delivery of this
Agreement.
7.9. RIGHTS CUMULATIVE
The rights and remedies of Secured Party described herein are
cumulative and not exclusive of any other rights or remedies which Secured Party
otherwise would have at law or in equity or otherwise. No notice to or demand on
Debtor in any case shall entitle Debtor to any other notice or demand in similar
or other circumstances.
7.10. ENTIRE AGREEMENT, MODIFICATION; BENEFIT
This Agreement and the exhibits hereto constitute the entire
agreement of the parties hereto with respect to the transactions contemplated
herein, and supersede all prior oral and written agreements with respect to the
transactions contemplated herein, and may not be modified, deleted or amended in
any manner except by agreement in writing executed by the parties.
7.11. TERMINATION
This Agreement shall terminate upon payment in full of all
amounts payable and performance of all other obligations owed by Borrower to
Secured Party under this Agreement.
7.12. CONSTRUCTION
This Agreement, the rights and obligations of the parties
hereto, and any claims or disputes relating thereto, shall be governed by and
construed in accordance with the laws of Maryland (but not including the choice
of law rules thereof). Each party hereto hereby acknowledges that all parties
hereto participated equally in the negotiation and drafting of this Agreement
and that, accordingly, no court construing this Agreement shall construe it more
stringently against one party than against the other.
7.13. EXECUTION
To facilitate execution, this Agreement may be executed in as
many counterparts as may be required; and it shall not be necessary that the
signatures of, or on behalf of, each party, or that the signatures of all
persons required to bind
- 14 -
146
any party, appear on each counterpart; but it shall be sufficient that the
signature of, or on behalf of, each party, or that the signatures of the persons
required to bind any party, appear on one or more of the counterparts. All
counterparts shall collectively constitute a single agreement. It shall not be
necessary in making proof of this Agreement to produce or account for any
particular number of counterparts; but rather any number of counterparts shall
be sufficient so long as those counterparts contain the respective signatures
of, or on behalf of, all of the parties hereto.
7.14. FILING
A photographic or other copy of this Agreement may be filed in
lieu of a financing statement.
- 15 -
147
IN WITNESS WHEREOF, each of the parties have duly caused this
Security Agreement to be duly executed in its name and on its behalf, as of the
date first written above.
ATTEST: DEBTOR:
INTRACEL CORPORATION
By: By:
------------------------------- --------------------------------------
Name: Name:
----------------------------- ------------------------------------
Title: Title:
---------------------------- -----------------------------------
ATTEST: SECURED PARTY:
LEHIGH VALLEY HOSPITAL AND
HEALTH NETWORK
By: By:
------------------------------- --------------------------------------
Name: Name:
----------------------------- ------------------------------------
Title: Title:
---------------------------- -----------------------------------
- 16 -
148
EXHIBIT M
XXXX OF SALE
THIS XXXX OF SALE (the "XXXX OF SALE") is executed and delivered effective
this ________ day of _______ 199__, by Lehigh Valley Hospital and Health
Network, a Pennsylvania non-profit corporation ("SELLER"), to Intracel
Corporation, a Delaware corporation ("BUYER").
WHEREAS, Seller and Buyer have entered into a Joint Venture Agreement
dated as of November __, 1998, providing for, among other things, the purchase
by the Buyer of the assets described in Exhibit A attached hereto and
incorporated by reference herein (the "ASSETS"); and
WHEREAS, the parties hereto desire by this Xxxx of Sale for Seller to
sell, assign, transfer and convey to Buyer the Assets for the purchase price
(the "PURCHASE PRICE") set forth herein.
NOW, THEREFORE, for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties agree as follows:
1. Seller hereby grants, bargains, sells, delivers, transfers, sets
over, assigns and conveys to Buyer and its successors and assigns, free and
clear of any and all liens, claims or encumbrances of any kind, except for
Seller's Security Interest (as defined below), those Assets set forth in
Exhibit A for a total aggregate Purchase Price of $_____, of which $______ shall
be paid by Buyer by check or wire transfer of readily available funds, and the
remaining $______ shall be paid by Buyer in the form of a convertible promissory
note substantially in the form of Exhibit B attached hereto (the "PROMISSORY
NOTE"), which is secured by a Security Agreement of even date herewith, by and
between Buyer and Seller substantially in the form of Exhibit C attached hereto
(the "SECURITY AGREEMENT"), pursuant to which Buyer has granted a security
interest in the Assets (the "SELLER'S SECURITY INTEREST") to secure Buyer's
obligations under the Promissory Note. The principal amount due under the
Promissory Note shall be due and payable on _________, 20__ together with
interest thereon at a rate equal to the prime rate of
149
interest as published in the Wall Street Journal. The parties agree that the
Purchase Price reflects the fair market value of the Assets.
2. Seller, for itself and its successors and assigns, covenants to and
agrees with Buyer to warrant and defend the sale, transfer, assignment,
conveyance and delivery of the Assets unto Buyer and its successors and
assigns, against all lawful claims and demands arising from Seller's ownership
of the Assets prior to the date hereof.
3. Seller hereby covenants to and agrees with Buyer that it will duly
execute and deliver any other documents necessary to effect the transfer of the
Assets.
4. All of the terms and provisions of this Xxxx of Sale shall be binding
upon Seller and its respective successors and assigns, and shall inure to the
benefit of Buyer and its successors and assigns.
5. This Agreement shall be governed by, and construed in accordance with,
the internal laws of the State of Maryland, excluding choice of law rules.
6. This Agreement may be executed in counterparts, each of which shall
be deemed an original and all of which shall be deemed one and the same
instrument.
IN WITNESS WHEREOF, Seller and Buyer have caused the due execution of this
Xxxx of Sale as of the day and year first written above.
LEHIGH VALLEY HOSPITAL AND HEALTH
NETWORK
By: ______________________
Name: ____________________
Title: ___________________
INTRACEL CORPORATION
By: ______________________
Name: ____________________
Title: ___________________
2
150
EXHIBIT N
AMENDED AND RESTATED INITIAL ONCOVAX CENTER LEASE
THIS AMENDED AND RESTATED INITIAL ONCOVAX CENTER LEASE (this
"LEASE"), is entered into as of December 11, 1998 by and between LEHIGH VALLEY
HOSPITAL AND HEALTH NETWORK, a Pennsylvania non-profit corporation
("LANDLORD"), having its principal office at Cedar Crest & I-78, Allentown, PA
and INTRACEL CORPORATION, a Delaware corporation (the "TENANT"), having its
principal office at 0000 Xxxxxxx Xxxxx, Xxxxxxxxx, XX.
WHEREAS, on October 21, 1998 the parties hereto were negotiating in
good faith the terms of a Joint Venture Agreement to be entered into by and
between the parties (the "JOINT VENTURE AGREEMENT"), which contemplated that
the parties would enter into an Initial OncoVax Center Lease (the "INITIAL
ONCOVAX CENTER LEASE") and notwithstanding the fact that the Joint Venture
Agreement was not entered into on such date, the parties entered into the
Initial OncoVax Center Lease and an accompanying letter agreement;
WHEREAS, the parties have concluded the negotiations of the Joint
Venture Agreement and desire to enter into such Joint Venture Agreement; and
WHEREAS, the parties desire to enter into this Lease to amend and
restate the Initial OncoVax Center Lease in its entirety to reflect all of the
additional terms and conditions relating to said lease as negotiated between
the parties since the execution of the Initial OncoVax Center Lease.
NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements hereinafter set forth, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto hereby agree as follows:
W I T N E S S E T H:
1. LEASED PREMISES; FIXTURES AND EQUIPMENT; COMMON AREAS
Landlord does hereby grant, demise and lease unto Tenant, and Tenant
does hereby lease and take from Landlord, for the Term (as defined below) and
upon the terms and conditions set forth in this Lease, the premises known as
the "Clean Room" which is located on the second floor of the General Services
Building of Landlord's hospital and described on EXHIBIT A attached hereto,
together with the clinical patient care, administration and storage space also
151
described on EXHIBIT A, and all improvements made by Landlord, now or hereafter
constructed thereon and all rights, privileges, easements and appurtenances
belonging or pertaining thereto (collectively, the "LEASED PREMISES"), together
with all of Landlord's fixtures and personal property, whether owned or leased
by Landlord, located on or used or useful or associated with, the Leased
Premises, including but not limited to the Clean Room Equipment (as defined in
EXHIBIT B), and all other furnishings, machinery, apparatus, movable or
non-movable equipment and materials described in EXHIBIT B attached hereto
(collectively the "FIXTURES AND EQUIPMENT"). Landlord also hereby grants to
Tenant a nonexclusive license of the benefit of Tenant, its employees, agents
and invitees for access to and from the Leased Premises through the building
and over the property of Landlord appurtenant thereto, and to use those parts
of the building designated by Landlord for use by tenants including, but not
limited to toilet rooms, elevators and unrestricted parking areas, all as more
particularly described in EXHIBIT C attached hereto (collectively, the "COMMON
AREAS").
2. SERVICES
During the Term, Landlord shall provide Tenant with all services,
including, but not limited to, electricity, heat, gas and air conditioning
(collectively "UTILITIES"), removal of hazardous waste, cleaning services and
laundry, necessary and sufficient for Tenant to use the Leased Premises as
described in SECTION 9.1 below.
3. POSSESSION
Landlord shall deliver to Tenant on the Commencement Date (as herein
defined) actual and exclusive possession of the Leased Premises, free and clear
of all leases, tenancies, agreements, matters, liens and defects in title,
together with exclusive possession of the Fixtures and Equipment.
4. TERM
The term of this Lease (the "TERM") shall commence on November 1,
1998 (the "COMMENCEMENT DATE") and shall end, unless earlier terminated as
described in SECTION 5 below, on the Final Closing Date as that term is defined
in that certain Joint Venture Agreement (the "JOINT VENTURE AGREEMENT") entered
into by and between the parties hereto and dated of even date herewith. The
parties agree that this Lease shall immediately expire or terminate upon the
Final Closing Date or earlier terminate as described in SECTION 5 below
without the necessity of any notice from either Landlord or Tenant to
terminate the same, and Tenant hereby expressly waives all right to any notice
which may be required under any laws now or hereafter enacted and in force in
Pennsylvania, including The
2
152
Landlord and Tenant Act of 1951, Act of April 6, 1951, Act of April 6, 1951,
P.L. 69 as amended (the "Act") upon such expiration or termination.
5. EARLY TERMINATION
5.1 TERMINATION OF JOINT VENTURE AGREEMENT
This Lease shall immediately terminate if the Joint Venture Agreement is
terminated for any reason.
5.2 EVENTS OF DEFAULT; REMEDIES
5.2.1 EVENTS OF DEFAULT BY TENANT
Any of the following occurrences or acts shall constitute an "Event
of Default" under this Lease:
(i) Tenant fails to pay, on the date on which the same is due
and payable, any installment of monthly rent and any additional payments,
within ten days after Landlord notifies that such payment is overdue and due
and owing.
(ii) Except as otherwise provided herein, a party fails to
observe or perform any other provision hereof for 30 days (or such shorter
period of time if such default endangers life or property) after the
non-breaching party shall have delivered to Tenant notice of such failure.
(iii) A party's filing of a petition in bankruptcy under Title
11 of the United States Code, as amended, or the commencement of a proceeding
under any other applicable law concerning insolvency, reorganization or
bankruptcy or a party becomes generally unable to pay its debts as they become
due; provided, however, if a proceeding with respect to an act of bankruptcy is
filed or commenced against Tenant, the same shall not constitute an Event of
Default if such proceeding is dismissed within 60 days from the date of such
filing.
(iv) The Leased Premises shall have been abandoned.
(v) Any representation or warranty made herein or any statement
or representation made in any certificate, report or opinion (including legal
opinions), financial statement or other instrument furnished in connection with
this Lease, proves to have been incorrect, false or misleading in any material
respect when made.
(vi) A party fails to comply with any requirement of any
governmental authority having jurisdiction within the time required by such
governmental authority; or any proceeding is commenced or action taken to
enforce
3
153
any remedy for a violation of any requirement of a governmental authority or
any restrictive covenant affecting the Leased Premises or any part thereof.
5.2.2. REMEDIES
If an Event of Default shall have happened and be continuing, a party
shall have the right at its election, then or at any time thereafter while such
Event of Default shall continue, to give written notice of its intention to
terminate this Lease on a date specified in such notice. Upon the giving of such
notice, the Term and the estate hereby granted shall expire and terminate on
such date as fully and completely and with the same effect as if such date were
the date hereinbefore fixed for the expiration of the Term.
5.3. OTHER TERMINATION EVENTS
This Lease may also be earlier terminated as further described in
Sections 10.4 and 15 below.
6. ACTIONS UPON TERMINATION
Upon the expiration or termination of this Lease,
(i) Tenant shall immediately permit Landlord and its employees and
agents full access to the Leased Premises to aid in the transition to a new
operator, and further agrees to give up quite and peaceful possession without
further notice from Landlord.
(ii) If termination results because of Tenant's Event of Default,
Tenant shall continue to pay to Landlord the monthly rent until the end of the
Term; provided, that Tenant shall not be responsible for such rent if the Leased
Premises have been relet.
7. PAYMENTS
7.1 RENTAL PAYMENTS
Tenant shall pay as rent for the Leased Premises and the Fixtures and
Equipment to Landlord during the period of time from the Commencement Date
through the Term monthly installments of Six Thousand Six Hundred and Ninety
Dollars and no cents ($6,690.00), in advance without demand on or before the
first day of each month from and including the month in which the commencement
Date occurs, which the parties agree (i) reflects the fair market rental value
of the Leased Premises and the Fixtures and Equipment and (ii) is attributable
in its entirety to
4
154
the Fixtures and Equipment. Rent for any partial month shall be prorated based
upon the actual number days in such month.
7.2. ADDITIONAL PAYMENTS
Tenant shall pay as additional payments for the services provided in
Section 2 above (except Utilities which Landlord shall provide to Tenant
without any additional payments), monthly installments of Two Thousand Dollars
and no cents ($2,000.00), in advance without demand on or before the first day
of each month from and including the month in which the Commencement Date
occurs, which the parties agree reflects the fair market value of the services
provided in Section 2.
7.3. DEFAULT
Tenant may not be declared in default for non-payment of rent or any
additional payments due hereunder if such rent or additional payments is/are
received by Landlord by the 10th day of the month.
8. TITLE AND QUIET ENJOYMENT
Subject to Section 18 below, Landlord hereby represents, warrants and
covenants that it has good and marketable fee simple title to the Leased
Premises, that the same is subject to no other leases, tenancies, agreements,
encumbrances (including delinquent taxes), liens or defects in title affecting
said property or the rights granted Tenant in this Lease. Landlord further
covenants that there are no restrictive covenants, zoning or other local
ordinances or regulations which will prevent Tenant from using and occupying
the Leased Premises for a current Good Manufacturing Practices ("cGMP")
laboratory and support area. Landlord further represents, warrants and
covenants that it has good and marketable title to all Fixtures and Equipment
and that same are subject to no leases, agreements, encumbrances, liens or
defects in title affecting said property or the rights granted Tenant in this
Lease. Landlord covenants and agrees that during the Term, Tenant shall, upon
paying the rent and performing the covenants of this Lease on its part to be
performed, peaceably and quietly have, hold and enjoy the Leased Premises and
Fixtures and Equipment and all rights granted Tenant in this Lease.
5
155
9. USES OF LEASED PREMISES; ACCESS TO LEASED PREMISES AND COMMON AREAS
9.1. TENANT'S USE OF LEASED PREMISES
The Leased Premises and the Fixtures and Equipment therein shall be
used for the conduct and operation of a cGMP laboratory and support area in
conformity with applicable law and the terms and conditions of the Joint
Venture Agreement. The Leased Premises shall be operated under the names of
"Intracel Corporation," and no other names shall be permitted to be used in
lieu of or in addition to such name without the prior written consent of
Landlord. Tenant hereby agrees to comply and conform in all material respects
with all legal requirements concerning the use, occupancy and conditions of the
Leased Premises and all machinery, equipment, furnishings, fixtures and
improvements therein. If any such legal requirement requires an occupancy or
use permit, license, special exception, or other local, state or federal agency
certification, then Tenant shall promptly obtain and keep current the same.
9.2. LANDLORD ACCESS TO LEASED PREMISES
Landlord may enter upon the Leased Premises, upon reasonable notice
to Tenant, to inspect, maintain, repair the Leased Premises. Landlord may enter
the Leased Premises at any time to perform emergency repairs to preserve the
Leased Premises and/or the Fixtures and Equipment.
9.3. TENANT'S ACCESS TO LEASED PREMISES AND COMMON AREAS
Landlord shall keep the Leased Premises and the Common Areas "open"
during normal business hours which, for purposes of this Lease, shall mean 24
hours a day, 365 days a year. Landlord shall provide lighting, electricity,
heat, air conditioning, water, elevator service and other necessary services
for Tenant's use and access to the Leased Premises and the Common Areas when
open. Tenant's use of the Common Areas shall not unreasonably hinder or
interfere with the Landlord's or other tenants' use of their Common Areas.
10. CONDITIONS OF LEASED PREMISES, FIXTURES AND EQUIPMENT; MAINTENANCE AND
REPAIRS
10.1. CONDITION OF LEASED PREMISES, FIXTURES AND EQUIPMENT
Landlord hereby represents and warrants that the Leased Premises are
constructed substantially in compliance with all applicable building codes and
regulations and substantially in accordance with the plan and specifications
6
156
approved by the Commonwealth of Pennsylvania Board of Health (the "Board of
Health"). Upon the expiration or earlier termination of the Lease, Tenant
shall surrender the Leased Premises in good condition, reasonable wear and tear
and damage by casualty and fire excepted, with all lighting, plumbing,
electrical and life/safety systems and the Fixtures and Equipment, in good
working condition, other than the "Tenant's Fixtures and Equipment Required to
be Removed or Otherwise Transferred" (as defined in Section 11.2).
10.2 TENANT'S MAINTENANCE AND REPAIRS
During the Term of this Lease, Tenant, at its expense, hereby agrees
to clean, and maintain and keep in good repair its equipment.
10.3 LANDLORD'S MAINTENANCE AND REPAIRS
Landlord shall make and pay for all repairs, replacements and
maintenance which are necessary for the operation of the Leased Premises, the
Common Areas, and the Fixtures and Equipment, excluding repairs or maintenance
necessitated by Tenant's willful acts or gross negligence. Tenant agrees to
notify Landlord of any necessary repairs within a reasonable period time of its
discovery. If Landlord fails to commence to perform any such maintenance,
replacement and repair after five days notice from Tenant, Tenant shall have
the right to undertake such maintenance, replacement and repair and to deduct
any expenditures associated therewith from the rent payments due under Section
7.1 above.
10.4 FIRE OR OTHER HAZARD
Tenant hereby agrees to notify Landlord of any damages to the Leased
Premises resulting from fire or other hazard and also of any dangerous or
hazardous condition within the Leased Premises immediately upon the occurrence
of such fire or other hazard or discovery of such condition, or as soon as
practicable thereafter. Upon occurrence of a fire, repairs shall be made by
Landlord as soon as reasonably may be done unless the costs of repairing the
Leased Premises exceed 25% of the replacement cost of the building in which
case the Landlord may, at its option, terminate this Lease by giving Tenant
written notice of termination within 45 days of the date of such fire. If the
Landlord does not terminate this Lease as described above, then Landlord has 45
days after the date of such fire to give written notice to Tenant setting forth
Landlord's unqualified commitment to make all necessary repairs or
replacements, the projected date of commencement of such repairs, and
Landlord's good faith estimate of the date of completion of the same. If
Landlord fails to give such notice, or if the date of completion is more than
90 days after the date of the fire or other hazard, then Tenant may, at its
option, terminate this Lease and Landlord will be obligated to refund to Tenant
any rent allocable to the period subsequent to the date of the fire. During any
period of restoration and
7
157
repair Tenant shall continue to operate within the Leased Premises to the
extent practicable, with a pro-rata reduction in the rental payments based upon
the usable portions of the Leased Premises.
11. ALTERATIONS AND REMODELING OF LEASED PREMISES, AND FIXTURES AND EQUIPMENT
11.1 ALTERATIONS AND MODIFICATIONS TO THE LEASED PREMISES
Tenant may, at its own expense, from time to time during the term of
this Lease, upon the prior written approval of Landlord as described in Section
11.3 below, make such structural alterations, additions, replacements and
changes, in and to the Leased Premises, and any buildings thereon, as it finds
necessary or desirable for the operation of the Leased Premises as a cGMP
laboratory. All such alterations, demolitions, additions, replacements and
changes shall be made in accordance with plans and specifications prepared by
Tenant and approved by Landlord, in conformity with applicable building laws
and regulations. Except for Fixtures and Equipment acquired, or purchased and
contributed to ICC (as defined below) by Tenant pursuant to Section 11.2 below,
such alterations, additions, replacements and changes shall become a part of
the Leased Premises, shall be maintained and kept in repair in accordance with
the provisions of Section 10, and at the expiration or termination of this
Lease shall become the property of Landlord without the payment of any money or
other consideration.
11.2 ALTERATIONS AND MODIFICATIONS TO THE FIXTURES AND EQUIPMENT
Tenant may, at its own expense, from time-to-time during the term of
this Lease, install, replace and operate in the Leased Premises such removable
medical equipment and personal property ("TENANT'S FIXTURES AND EQUIPMENT") as
it shall deem necessary or desirable in the conduct of its business, provided
all laws, rules and regulations of governmental bodies with respect thereto
shall be in all material respects complied with by Tenant. Tenant may also,
upon the prior written approval of Landlord as described in Section 11.3 below,
make such alterations, additions, replacements and changes, in and to the
Fixtures and Equipment, as it finds necessary or desirable for the operation of
a cGMP laboratory. The Clean Room Equipment as described on Exhibit B shall be
sold to Tenant by Landlord as of the Final Closing Date and this Lease's
expiration date pursuant to Section 6.1 of the Joint Venture Agreement and
together with any alterations, additions, replacements and changes thereto
shall be concurrently contributed to Intracel Cancer Center of Pennsylvania,
Inc. ("ICC") pursuant to Sections 3.1 and 6.2 of the Joint Venture Agreement.
If this Lease is earlier terminated by Tenant pursuant to Section 5.2.1 above,
the Clean Room Equipment and together with any alterations, additions,
replacements and changes thereto shall remain Landlord's property and Landlord
shall reimburse Tenant the actual
8
158
costs of all alterations, additions, replacements and changes thereto. Prior to
the expiration or termination of this Lease, Landlord and Tenant shall
designate those items of Tenant's Fixtures and Equipment that Landlord or
Tenant desires be removed from the Leased Premises, and the Clean Room
Equipment to be purchased by Tenant and contributed to ICC upon the expiration
or termination of the Lease ("TENANT'S FIXTURES AND EQUIPMENT REQUIRED TO BE
REMOVED OR CONTRIBUTED"). With the exception of Tenant's Fixtures and Equipment
Required to be Removed or Contributed, all of the Fixtures and Equipment shall
remain on the Leased Premises at the termination of this Lease and shall remain
the property of Landlord.
11.3 LANDLORD'S CONSENT
Landlord agrees not to unreasonably withhold, delay or condition its
consent to any action proposed by Tenant pursuant to this Section 11, provided
that (i) the alterations, construction or installation shall not have a
material adverse effect on the structure, appearance or use of the Leased
Premises or the building in which the Leased Premises are located or Fixtures
and the Equipment, in the reasonable judgment of Landlord, (ii) all such
alterations, construction and installations shall be expeditiously completed in
compliance with all legal requirements, (iii) all work done in connection with
any such alterations, construction or installation shall comply with the
requirements of any insurance policy required to be maintained by Tenant
hereunder, (iv) Tenant shall promptly pay all costs and expenses of any such
alteration, construction or installation and shall discharge all liens filed
against any of the Leased Premises or the Fixtures and Equipment arising out of
the same, (v) Tenant shall procure and pay for all permits and licenses
required in connection with any such alteration, construction or installation,
(vi) such alterations shall comply with any recorded lien or covenant affecting
the Leased Premises, and (vii) Landlord shall incur no expense or cost
whatsoever in connection with such alterations, including without limitation,
costs for reviewing and approving plans, or tap fees or other utility fees.
Landlord may require, as a condition to its consent to any alterations,
reasonable appropriate payments, bonds, assurances and undertakings from Tenant
to ensure that all such conditions are satisfied. Notwithstanding the
foregoing, it shall not be unreasonable for Landlord to withhold its consent,
or to condition its consent, if the holder of a mortgage withholds its consent
to any of the foregoing, or requires that certain conditions or requirements be
satisfied or observed.
11.4 LIENS OF ENCUMBRANCES
Except as permitted under Section 18, neither Tenant nor Landlord
will directly or indirectly, create or permit to be created or to remain, and
will promptly discharge, at its expense, any lien or encumbrance with respect
to, the Leased Premises or any part thereof, or the Fixtures and Equipment or
either party
9
159
interest therein as a result of any alteration, construction, installation or
other action of either party. The existence of any mechanic's, laborer's,
materialman's, supplier's or vendor's lien, or any right in respect thereof,
shall not constitute a violation of this Section 11.4 if payment is not yet due
upon the contract or for the goods or services in respect of which any such
lien has arisen so long as such payment is made or bonded off within 30 days
after the later to occur of the completion of the work which gave rise to the
imposition of said liens or the rendering of the invoice, statement or demand
for such payment. Nothing contained in this Lease shall be construed as
constituting the consent or request of Landlord, expressed or implied, of any
contractor, subcontractor, laborer, materialman or vendor to or for the
performance of any construction, alteration, addition, repair or demolition of
or to the Leased Premises or any part thereof.
12. ENVIRONMENTAL MATTERS
12.1. DEFINITIONS
As used in herein, the following items shall have meanings set forth
below:
(i) "CAA" shall mean the Clean Air Act, codified at 42 U.S.C.
Sections 7401, et seq., as amended.
(ii) "CERCLA" shall mean the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, codified at 42 U.S.C.
Sections 9601, et seq., as amended.
(iii) "CWA" shall mean the Clean Water Act, codified at 33 U.S.C.
Sections 407, et seq., as amended.
(iv) "ENFORCEMENT AGENCY" shall mean, collectively, the
Environmental Protection Agency ("EPA") and any state, county, municipal or
other agency having authority to enforce any Environmental Laws.
(v) "ENVIRONMENTAL LAWS" shall mean CERCLA, HMTA, RCRA, CAA,
CWA, TSCA, RHA and the Right-to-Know Act and all other federal local and
municipal laws, statutes, ordinances and codes, guidelines and standards
relating to health, safety, sanitation, and the protection of the environment
or governing the use, storage, treatment, generation, transportation,
processing, handling, production or disposal of Hazardous Materials, including,
without limitation, the Pennsylvania Solid Waste Management Act, 35 P.S.
Sections 6018.103, et seq., the Pennsylvania Hazardous Sites Clean Up Act (Act
108 of 1988), laws and regulations regarding the discharge of water or other
materials or fluids into waterways, and the rules, regulations, guidelines,
decisions, orders and
10
160
directives of federal, local and municipal governmental agencies, authorities
and courts with respect thereto presently in effect or hereafter enacted,
promulgated or implemented.
(vi) "ENVIRONMENTAL PERMITS" -shall mean all permits, licenses,
approvals, authorizations, consents or registrations required by any applicable
Environmental Laws, on either an individual or group basis, in connection with
the construction, ownership, use or operation of the Leased Premises, or the
storage, treatment, generation, transportation, processing, handling, production
or disposal of Hazardous Materials related to the leased Premises.
(vii) "HAZARDOUS MATERIALS" -shall mean, without limitation,
flammable, explosives, radioactive materials, asbestos, urea formaldehyde foam
insulation, polychlorinated biphenyls, petroleum or petroleum based or related
substances, hydrocarbons or like substances and their additives or constituents,
and any substances now or hereafter defined as "hazardous substances,"
"extremely hazardous substances," "hazardous wastes," "infectious wastes" or
"toxic chemicals" in any Environmental Laws, or in any regulation or order
issued pursuant to any Environmental Laws.
(viii) "HMTA" -shall mean the Hazardous Materials Transportation
Act, codified at 49 U.S.C. Sections 1801, et seq., as amended.
(ix) "RCRA" -shall mean the Resource Conservation and Recovery
Act of 1976, codified at 42 U.S.C. Sections 6801, et seq., as amended.
(x) "RELEASE" -shall have the same meaning as given to that term
in CERCLA, as amended, and the regulations promulgated thereunder.
(xi) "RHA" -shall mean the Rivers and Harbors Appropriation Act,
codified at 33 U.S.C. Sections 401, et seq., as amended.
(xii) "RIGHT-TO-KNOW ACT" -shall mean the Emergency Planning and
Community Right-To-Know Act, codified at 42 U.S.C. Sections 11001, et. seq., as
amended.
(xiii) "TSCA" -shall mean the Toxic Substances Control Act,
codified at 15 U.S.C. Sections 2601, et. seq., as amended.
12.2. LANDLORD OBLIGATIONS; REPRESENTATION AND WARRANTIES
Landlord hereby represents and warrants to Tenant that on the
Commencement Date the Leased Premises does not contain asbestos or any Hazardous
Materials. Landlord shall be responsible for costs, expenses, damages and
penalties resulting from the existence of any Hazardous Materials in the
11
161
Leased Premises at the date of execution of this Lease and all alterations made
by Landlord to the Leased Premises or the Common Areas shall be made in
accordance any comply with all Environmental Laws and the requirements of any
Enforcement Agencies.
12.3. TENANT OBLIGATIONS
Tenant shall comply at all times and in all respects with the
provisions of all Environmental Laws and Environmental Permits, and shall not
commit any actions or omissions that result in the incurrence of any liability
under such Environmental Laws and Environmental Permits. Tenant shall obtain,
whenever necessary and in its own name, appropriate Environmental Permits for
its operations and shall comply in all respects with the requirements of such
Environmental Permits. All alterations made in the Leased Premises made by
Tenant shall be made in accordance with and shall comply with all Environmental
Laws and the requirements of any Enforcement Agencies. If any statutes, laws,
ordinances, rules or regulations are promulgated at any time after the date of
execution of this Lease for the removal, abatement or containment of Hazardous
Materials in the Leased Premises or any portion of the Leased Premises and, in
the reasonable judgment of Landlord, it is hazardous for the Tenant to remain
in the Leased Premises during such removal, abatement, or containment of the
Hazardous Materials, Tenant shall vacate the Leased Premises or that portion of
the Leased Premises that is hazardous and, provided that such condition did not
result from Tenant's acts, omissions, or operations, Tenant's rent shall be
abated proportionately for the period of time in which Tenant's use of such
portion of the Leased Premises has been interrupted. Tenant shall not
intentionally or unintentionally use, store, handle, spill or discharge any
Hazardous Materials at or in the vicinity of the Lease Premises, other than
those Hazardous Materials generally used, stored or handled in a cGMP
laboratory. Tenant shall promptly deliver to Landlord copies of all notices
made by Tenant to, or received by Tenant from, any Enforcement Agency or from
the United States Occupational Safety and Health Administration concerning
environmental matters or Hazardous Materials at the Leased Premises.
12.4. INDEMNIFICATION; HOLD HARMLESS
Landlord shall indemnify, defend and hold Tenant harmless of and from
actual and direct losses arising out of or relating to any and all claims
arising from the existence, removal, containment, or abatement of any Hazardous
Materials from the Leased Premises related to Hazardous Materials existing in
the Leased Premises prior to the Commencement Date. Tenant shall indemnify,
defend and hold Landlord harmless of and from actual and direct losses arising
out of or relating to any and all claims arising by reason of any violation by
Tenant of the
12
162
provisions of Section 12.3 above. This indemnity provision shall survive
expiration or earlier termination of this Lease.
12.5. INSPECTIONS
At any time throughout the Term of this Lease, Landlord may cause an
inspection to be made of the Leased Premises and its surrounding area for the
purpose of determining whether any Hazardous Materials is present thereon.
13. INSURANCE
13.1. TENANT INSURANCE
Tenant shall, at all times through the Term and at its sole expense,
maintain professional and general liability insurance (through third party
insurers) against claims for bodily injury or death occurring in or about the
Leased Premises, such insurance to provide coverage not less than $3,000,000
per occurrence, $5,000,000 per annual aggregate. In addition, Tenant shall, at
all times through the Term and at its sole expense, maintain insurance for the
Fixtures and Equipment at replacement cost value, without coinsurance
provisions, against fire and such other hazards as are included within extended
coverage and against earthquake and flood damage, which insurance shall also
include major mechanical system repair and replacement coverage. All such
insurance shall name Landlord as an additional insured and shall provide that
Landlord be given 30 days prior notice of any material change or cancellation
of such insurance. Copies of such insurance policies shall be delivered to
Landlord, upon Landlord's request. The parties shall mutually determine how to
distribute any insurance proceeds received to replace any or all of the
Fixtures and Equipment.
13.2. LANDLORD'S INSURANCE
Landlord shall, at all times through the Term and at its sole
expense, maintain insurance for the Leased Premises and the Common Areas at
replacement cost value, without coinsurance provisions, against fire and such
other hazards as are included within extended coverage and against earthquake
and flood damage, which insurance shall also include major mechanical system
repair and replacement coverage. Copies of such insurance policies shall be
delivered to Tenant, upon Tenant's request.
14. LIABILITY OF LANDLORD
Landlord shall be liable for all loss of property by theft or otherwise,
for all damage to property, for all injuries to persons while on the Leased
Premises
13
163
from escape or leakage of water, rain, snow, or steam from any part of the
building on which the Leased Premises are located or from the pipes or plumbing
system therein, and for all damage resulting from the short circuiting of
electricity or from any other cause, where any such losses, damages and/or
injuries are due to the willful acts or negligence of the Landlord, its
servant, agents, or employees.
15. CONDEMNATION
If all or a part of the Leased Premises and/or Common Areas are taken by
eminent domain or conveyed in lieu thereof and such Leased Premises cannot then
be used by Tenant for its intended use as set forth in Section 9.1 above, this
Lease shall immediately terminate as of the date that the condemning authority
takes possession of the Leased Premises, subject to the following:
(i) All compensation awarded for the taking (or the proceeds of any sale
in lieu thereof) of the Leased Premises and/or Common Areas shall be
the property of the Landlord;
(ii) All compensation awarded for the taking or loss of any of the
Tenant's Fixtures and Equipment or for moving or relocation expenses
shall be the property of Tenant; and
(iii) If only part of the Leased Premises and/or Common Areas are taken
such that Tenant may still use the Leases Premises for its intended
use, this Lease shall remain in effect with a pro-rata reduction in
the rental payments based upon the usable portions of the Leased
Premises.
16. ASSIGNING OR SUBLETTING
Tenant shall not assign, sublet or in any manner transfer this Lease
or any estate or interest therein, or grant a license, concession or other
right of occupancy, to all or part of the Leased Premises, without Landlord's
prior written consent, except that Tenant may assign, sublet or in any manner
transfer this Lease of any estate or interest therein, or grant a license,
concession or other right of occupancy, to all of part of the Leased Premises
(i) to any successor to Tenant in the event of a merger or consolidation of
Tenant with another entity, or to any purchaser of all or substantially all of
the assets or business of Tenant, and (ii) to an Affiliate (as defined below).
For purposes of this Section 16, an Affiliate shall mean, as to any party
hereto, any corporation or other entity which, directly or indirectly, through
one or more intermediaries, controls (i.e., possesses, directly or indirectly,
the power to direct or cause the direction of the management and policies of an
entity, whether through ownership of voting securities, by contract, or
otherwise) is controlled by, or is under common control with such party. In the
14
164
event of any permitted assignment, all rights, obligations and liabilities
herein shall extend to any successors or assigns.
17. WAIVER OF SUBROGATION
To the extent permitted by their insurers, Landlord hereby releases
Tenant, and Tenant hereby releases Landlord, and their respective shareholders
or members, directors, officers, employees and agents, from any and all claims
or demands for damages, losses, expenses, or injury to the Leased Premises, or
to the Fixtures and Equipment, or the inventory or other property of Landlord
or Tenant, as the case may be, in, or about, the Leased Premises which may be
caused by or results from events or happenings which are covered by insurance
carried by the respective parties and in force at the time of any such damages,
losses, expenses, or injury.
18. SUBORDINATION; ESTOPPEL CERTIFICATES
Subject to Section 8 above, this Lease is subordinate to the lien of
all present or future mortgages which affect the Leased Premises and to all
renewals, modifications, replacements and extensions thereof. This provision
shall be self-operative, but in any event Tenant hereby agrees to execute
promptly and deliver any estoppel certificate or other assurances that Landlord
may request in furtherance hereof. In the event of any foreclosure of any such
mortgage or modification, Tenant shall attorn to the purchaser in foreclosure
of who shall be named in any deed in lieu of foreclosure, shall recognize any
such purchaser as the Landlord under this Lease, and so long as Tenant is not
in default hereunder, this Lease shall remain in full force and effect.
19. MISCELLANEOUS
19.1 NOTICE
All notices, demands, requests or other communications which may be
or are required to be given, served or sent by any party to any other party
pursuant to this Lease shall be in writing and shall be hand delivered
(including delivery by courier), sent by Federal Express or by other recognized
overnight delivery service, mailed by first-class, registered or certified
mail, return receipt requested, postage prepaid, or sent by telegram, telex, or
facsimile transmission, addressed as follows:
15
165
If to Intracel:
Intracel Corporation
0000 Xxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxx X. Xxxxx
Facsimile: (000) 000-0000
with a copy (which shall not constitute notice) to:
Xxxxx & Xxxxxxx L.L.P.
000 00xx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000-0000
Attn: Xxxxx X. Xxxxxxx, Esq.
Facsimile: (000) 000-0000
If to Lehigh:
Lehigh Valley Hospital and Health Network
Xxxxx Xxxxx & X-00
X.X. Xxx 000
Xxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attn: Xxxxx X. Xxxxxxxxx
Facsimile: (000) 000-0000
with a copy (which shall not constitute notice) to:
Xxxxxxx, Hudders & Xxxxxxxxxx
The Paragon Centre
0000 Xxxx Xxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attn: Xxxxxxx X. Xxxxxxxxxx, Esq.
Facsimile: (000) 000-0000
Each party may designate by notice in writing a new address to which any
notice, demand, request or communication may thereafter be so given, served, or
sent. Each notice, demand, request, or communication which shall be mailed,
delivered, or transmitted in the manner described above shall be deemed
sufficiently given, served, sent, or received for all purposes at such time as
it is delivered to the addressee (with the return receipt, the delivery
receipt, the affidavit of messenger, or (with respect to a telex or facsimile)
the answer back being deemed conclusive, but not exclusive, evidence of such
delivery) or at such time as delivery is refused by the addressee upon
presentation.
16
166
19.2. COMPLETE AGREEMENT
This Lease, and all Exhibits hereto and incorporated agreements (including
the Joint Venture Agreement) set forth the entire agreement of the parties
hereto with respect to its subject matter and any and all prior agreements,
whether oral or written, between or among the parties hereto and relating to
the subject matter hereof are superseded hereby.
19.3. GOVERNING LAW
This Lease and the rights and obligations of the parties hereto shall
be governed by and construed and enforced in accordance with the laws of the
Commonwealth of Pennsylvania (excluding choice of laws rules thereof).
19.4. PARAGRAPH HEADINGS
The paragraph headings in this Lease are for convenience only and are
not a part of this Lease and do not in any way limit or amplify the terms and
provisions hereof and in no way shall be held to explain, modify or aid in the
interpretation, construction or meaning of the provisions of this Lease.
19.5. SEVERABILITY
In the event that a court of competent jurisdiction holds that a
particular provision or requirement of this Lease is in violation of any
applicable law, each such provision or requirement shall be enforced only to
the extent it is not in violation of such law or is not otherwise unenforceable
and all other provision and requirements of this Lease shall remain in full
force and effect.
19.6. MODIFICATION; WAIVER
This Lease shall not be modified or amended except by an instrument
in writing signed by Landlord and Tenant. No delay or failure on the part of
any party hereto in exercising any right, power, or privilege under this Lease
or any other instruments executed and delivered in connection with or pursuant
to this Lease, shall impair any such right, power, or privilege or be construed
as a waiver of any default hereunder or any acquiescence therein. No single or
partial exercise of any such right, power, or privilege shall preclude the
further exercise of such right, power, or privilege, or the exercise of any
other right, power, or privilege. No waiver shall be valid against any party
hereto unless made in writing and signed by the party against whom enforcement
of such waiver is sought and then only to the extent expressly specified
therein.
17
167
19.7 BENEFIT OF THIS LEASE
It is the explicit intention of the parities hereto that except as
set forth below no person or entity other than a party hereto is or shall be
entitled to bring any action to enforce any provision of this Lease against any
of the parties hereto, and that the covenants, undertakings, and agreements set
forth in this Lease shall be solely for the benefit of, and shall be
enforceable only by, the parties hereto or their respective successors and
assigns as permitted hereunder.
19.8 SIGNAGE ON LEASED PREMISES
Landlord shall, at its own expense, erect all exterior and interior
signage at the Leased Premises as approved by Tenant.
19.8 INDEPENDENT CONTRACTOR
Tenant shall lease and operate the Leased Premises as an independent
contractor, and shall not be considered an agent, employee of, partner of or
joint venturer with Landlord.
19.10 EXECUTION COUNTERPARTS
This Lease may be executed in counterparts, each of which shall
constitute and original hereof for all purposes.
18
168
IN WITNESS WHEREOF, each of the parties intending to be legally bound has
duly caused this Lease to be duly executed and delivered in its name and on its
behalf, as of the date first written above.
TENANT:
INTRACEL CORPORATION
By:
---------------------------
Name:
-------------------------
Title:
------------------------
LANDLORD:
LEHIGH VALLEY HOSPITAL AND
HEALTH NETWORK
By:
---------------------------
Name:
-------------------------
Title:
------------------------
19
169
EXHIBIT A
DESCRIPTION OF CLEAN ROOM, AND CLINICAL PATIENT CARE,
ADMINISTRATIVE AND STORAGE SPACE
SEE ATTACHED
170
EXHIBIT B
DESCRIPTION OF FIXTURES AND EQUIPMENT
Set forth below is a description of the Fixtures and Equipment.
1. Clean Room Equipment. For purposes of this Lease, the term "Clean
Room Equipment" shall include all of the following equipment:
EQUIPMENT NAME MANUFACTURER MODEL # SERIAL #
Bio Safety Hood, 4' Xxxxx SG400 58432
Bio Safety Hood, 6' Xxxxx SG600 58388
Bio Safety Hood, 6' Xxxxx SG601 58382
Gammacell Irradiator Nordion 1000 A 247
Controlled Rate Freezer Xxxxxxxxx 7009 06911-0497
Freezer Chamber Xxxxxxxxx 8753 06911-0497
MVE-TEC 2000 Storage MVE XLC-500F CDRA97B101
Incubator, CO2 Sanyo MCO-17AI 60905781
Incubator, CO2 Sanyo MCO-17AI 60905783
Ultralow Freezer Sanyo MDF-U6088SC 61006995
Water Bath, 1 of 2 Precision 180 697050163
Water Bath, 2 of 2 Precision 180 697090900
Refrigerator/Freezer Kenmore 363-9662825 L70640925
Chemical Fume Hood Kewaunee H05 R106417
Balance Xxxxxxxxx De410-D 73866
Microscope Nikon Labophot-2 462566
Refrigerator, undercounter Kenmore 564.9936111 961003216
Refrigerator, undercounter Kenmore 564.9936111 960901790
Immersible Stirrer VWR 230 0094
Immersible Stirrer VWR 290 0066
Immersible Stirrer VWR 230 0086
Immersible Stirrer VWR 230 0092
Pipetman Rainin P-1000
Pipetman Rainin P-200
Pipetman Rainin P-200
Pipetman Rainin P-200
Magnahelic Gauge Sure Flow
Magnahelic Gauge Sure Flow
Megafuge 1.0R Hereaus 75003062/02 232331
Calibrated Timer VWR
4 Work Stations with
Divider Panels
3 Two Drawer Lateral Files
4 Office Chairs
5 Lab Chairs
Six door locker
2 two drawer file cabinets
1 Four Drawer File Cabinet
1 Six Drawer Lateral File
171
EQUIPMENT NAME MANUFACTURER MODEL # SERIAL #
Cabinet
3 Four Drawer File Cabinets
Computer Workstation with
Printer
Fax Machine Murata
2. Other furnishings, machinery, apparatus, movable or non-movable
equipment and materials. For purposes of this Lease, the term "Other
furnishings, machinery, apparatus, movable or non-movable equipment and
materials" shall include all of the following:
NONE
172
EXHIBIT C
DESCRIPTION OF COMMON AREAS
SEE ATTACHED
173
EXHIBIT O
INITIAL MEDICAL DIRECTOR SERVICES AGREEMENT
This Initial Medical Director Services Agreement (this "AGREEMENT") is
entered into as of December 11, 1998, by and between Intracel Corporation, a
Delaware for-profit corporation ("INTRACEL"), and Lehigh Valley Hospital and
Health Network, a Pennsylvania non-profit corporation ("LEHIGH") each a
("PARTY", and collectively "PARTIES").
WHEREAS, Intracel Corporation ("INTRACEL") and Lehigh have entered into a
Joint Venture Agreement dated as of December 11, 1998 (the "JOINT VENTURE
AGREEMENT") pursuant to which they intend to form a corporation ("ICC") to
operate a center for the manufacture and provision of OncoVaxCL(R) ("ONCOVAX"),
a product developed by Intracel to be utilized in the treatment of colon
cancer and other oncological products as agreed to by Intracel and Lehigh;
WHEREAS, during the period between the Effective Date and the formation of
capitalization of ICC, ICC and Lehigh have entered into an amended and restated
lease with the same effective date as this Agreement (the "AMENDED AND RESTATED
INITIAL ONCOVAX CENTER LEASE") pursuant to which Intracel is leasing from
Lehigh the necessary space and equipment to operate a laboratory and support
area in compliance with current Good Manufacturing Practices to manufacture and
provide OncoVax and other oncological products as agreed to by Intracel and
Lehigh (the "ONCOVAX CENTER";
WHEREAS, Xxxxxxx X. Xxxxxx, Xx., M.D. is a physician employed by Lehigh
Valley Physician Group, which is a Pennsylvania non-profit corporation and
wholly-owned subsidiary of Lehigh;
WHEREAS, Xxxxxxx X. Xxxxxx, Xx., M.D. serves as the Chair of Surgery for
Lehigh pursuant to an agreement between Lehigh Valley Physician Group and
Lehigh;
WHEREAS, Intracel desires to obtain the services of Xxxxxxx X. Xxxxxx,
Xx., M.D. ("MEDICAL DIRECTOR") or his designee on an initial part-time,
independent contractor basis from Lehigh for the provision of certain Medical
Director services at the OncoVax Center as set forth more fully in Section 1.1
("SERVICES");
WHEREAS, pursuant to the Joint Venture Agreement, Lehigh has agreed to
provide the Services of the Medial Director on an initial part-time,
independent contractor basis to Intracel for Intracel's Service Fee (as defined
below) to Lehigh; and
174
WHEREAS, the Parties desire to enter into this Agreement to set forth the
terms and conditions under which Lehigh will provide the Services to Intracel,
and Intracel will compensate Lehigh for such Services.
NOW, THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Parties agree as follows:
1. MEDICAL DIRECTOR SERVICES
1.1 GENERAL DESCRIPTION OF SERVICES
During the Term (as defined in Section 6), Lehigh shall provide the
Services to Intracel through Medical Director, or as described in Section 1.9
below, through the Medical Director's designee. The Services shall include: (a)
assisting Intracel in establishing and enhancing the OncoVax Center, including
assisting with the clinical design of the center and the establishment of
protocols and systems; and (b) serving the OncoVax Center once it is
operational as a medical director, including (1) participating in
administrative meetings and performing other administrative duties as requested
by Intracel, (2) recommending rules and policies for the operation of the
center, (3) serving as a liaison with Lehigh and Lehigh physicians, and (4)
assisting in the assessment of outcomes and other clinical data with respect to
OncoVax and other Intracel products. Medical Director and Lehigh acknowledge
and agree that, depending upon certain development decisions and other
circumstances, some details of Medical Director's duties may change over time.
This Agreement shall remain in effect notwithstanding such changes. Intracel
agrees to discuss any such changes with Medical Director and to consider his
input in these decisions. No activities or services performed by Medical
Director pursuant to this Agreement shall constitute the practice of medicine.
Any evaluations, diagnoses, treatments, procedures or other professional health
care services furnished to patients by Medical Director will be provided in his
individual capacity as a practicing physician or employee of Lehigh or other
entity, and will not be provided by Medical Director in his capacity as an
independent contractor to Intracel pursuant to this Agreement.
1.2 BEST EFFORTS
Medical Director shall devote his best efforts to performing the Services.
In doing so, Medical Director shall use his full education, skills, and
professional energy, consistent with his training and experience, to advance
the business interests of Intracel. During the Term of this Agreement, Medical
Director shall not engage in any other activity or occupation for compensation,
or any non-compensated activity, that in Intracel's reasonable opinion is
competitive with or adverse to the interests of Intracel, without the prior
written consent of Intracel. Notwithstanding the foregoing, nothing in this
Section 1.2 or elsewhere in this Agreement shall prevent
2
175
Medical Director, during the time not required for the performance of the
Services, from maintaining his individual medical practice or performing his
duties as the Chair of Surgery for Lehigh or an employee of Lehigh Valley
Physician Group.
1.3 HOURS AND RECORDS
Notwithstanding any other provision of this Agreement, Medical Director
shall not spend less than 15 hours per month or be required to spend more than
25 hours per month, on average, performing the Services. The Parties agree that
these minimum and maximum numbers are annual averages, and that Medical Director
may spend less than 15 hours or more than 25 hours in any particular month
depending on Intracel's needs and Medical Director's availability. Within ten
(10) days following the end of each calendar month during the Term of this
Agreement, Lehigh shall provide Intracel with a record of time Medical Director
spent performing the Services in the previous month. Such accounting shall
include the dates on which Medical Director performed Services, a description
of the Services performed on each date, and the amount of time spent performing
those Services.
1.4 REPORTING TO INTRACEL
Lehigh and/or Medical Director shall notify Intracel in writing within one
working day of the occurrence of any of the following: (a) Medical Director's
being notified that any written complaint or report concerning him has been
filed with the Pennsylvania state medical board or the National Practitioner
Data Bank; (b) Medical Director's being notified that any written complaint has
been filed against him, or any adverse action has been proposed (whether final
or not), at any hospital, other health care facility, health maintenance
organization, preferred provider organization, insurer or health plan,
professional review organization, professional association or governmental
body; (c) Medical Director's receiving a summons and complaint or a subpoena
relating to his professional practice; (d) Medical Director's being charged
with any crime (excluding minor traffic violations); (e) any other event which
reasonably might be anticipated to expose Intracel to a legal claim or adverse
publicity, or interfere with Medical Director's discharging his
responsibilities under this Agreement; or (f) any other disciplinary or
professional liability actions initiated against Medical Director. Medical
Director acknowledges and agrees that Intracel may inform malpractice carriers
or other appropriate parties of any such occurrence.
1.5 COMPLIANCE WITH LAW
Lehigh and Medical Director shall perform the Services faithfully,
diligently, ethically, in a professional manner and in accordance with all
applicable laws, regulations and currently recognized professional standards.
3
176
1.6 COMPLIANCE WITH INTRACEL RULES
Lehigh and Medical Director shall comply in all material respects with the
reasonable rules and policies of Intracel and the OncoVax Center, as they now
exist or as they may from time to time be amended, including rules and policies
governing the provisions of services, billing, records, and relationships with
OncoVax Center employees.
1.7 COOPERATION IN PROCEEDINGS
During and after the Term (and notwithstanding expiration or termination
of this Agreement for whatever reason), Lehigh and Medical Director shall,
without additional compensation, provide all reasonable assistance requested by
Intracel in order to (a) assert Intracel's rights under any insurance policies;
or (b) assist Intracel in defense of professional liability or other actions.
1.8 PROFESSIONAL LIABILITY INSURANCE
Lehigh covenants that the Medical Director shall at all times during the
Term be covered by professional liability insurance that meets all requirements
of the Pennsylvania Healthcare Malpractice Act, as amended, and that such
coverage will be provided at Lehigh's cost.
1.9 MEDICAL DIRECTOR'S DESIGNEE
The Parties agree that Medical Director may delegate the provision of
Services to a designee, which designee shall be Xxxxx Xxxxxxx, M.D. unless the
Parties mutually agree on another designee. Notwithstanding anything in Section
1.3 to the contrary, Medical Director's designee shall devote a minimum of
fifty percent (50%) of her professional time to the performance of the
Services. In the event of such delegation, Medical Director's designee shall be
subject to all the terms and conditions under this Agreement which are
applicable to Medical Director as if a reference to such designee was expressly
set forth in each provision applicable to Medical Director. Any breach of any
term or condition as applied to any designee shall be a breach thereof in the
same manner as if applied to Medical Director himself.
2. REPRESENTATION AND WARRANTIES OF LEHIGH
2.1 GENERAL REPRESENTATIONS AND WARRANTIES
Lehigh hereby represents and warrants that (a) Medical Director possesses
and throughout the Terms shall maintain, a current, valid, and unencumbered
license to practice medicine in the State of Pennsylvania; (b) Medical Director
either (1) is not
4
177
subject to any actual or threatened investigation, disciplinary proceeding,
ethics action, public or private suit or claim as to malpractice or
professional misconduct, and his performance in his job functions is not
impaired due to a physical or mental condition or substance abuse, or (2) as to
any such matter to which Medical Director is subject, full information has been
disclosed in writing to Intracel; (c) Medical Director either (1) knows of no
existing circumstances that would provide a basis for revoking or suspending
his medical license, or subjecting him to suit, or which would be harmful to
Intracel in engaging Medical Director, or (2) has disclosed the same in writing
to Intracel; (d) Medical Director has adequate malpractice "occurrence"
coverage or "tail" coverage under existing insurance with limits of liability
of not less than $1 million per occurrence and $3 million in the aggregate,
covering any claims relating to activities in his private medical practice, and
Lehigh shall indemnify and hold harmless Intracel from and against any claims,
costs or expenses arising from such activities; and (e) execution and
performance of this Agreement does not violate any contract, agreement,
regulatory ruling or judicial order to which Lehigh or Medical Director is
subject (including both the Medical Director's employment agreement and Lehigh's
agreement with Lehigh Valley Physician Group), or to the best of Lehigh's
knowledge, violate any law.
2.2 Effect of Inaccurate Representations or Warranties
The Parties acknowledge and agree that if any representation or warranty
contained in this Section 2 is untrue or becomes untrue during the Term of this
Agreement, such untrue representation or warranty shall be deemed to be a
material misrepresentation by Medical Director and Intracel shall have the
right to terminate this Agreement pursuant to Section 6.
3. RESPONSIBILITIES OF INTRACEL
3.1 Intracel Facilities
Throughout the Term of this Agreement, Intracel shall provide clerical and
other administrative support, to the extent Intracel deems reasonable, to help
facilitate Medical Director's performance of the Services.
3.2 Business and Property Liability Insurance
Intracel shall maintain general business and property liability insurance
for claims arising from (a) the occupancy of Intracel offices by Medical
Director; and (b) the performance by Medical Director of the Services in
accordance with the terms of this Agreement.
5
178
4. REPRESENTATIONS AND WARRANTIES OF INTRACEL
Intracel hereby represents and warrants that (a) it is a corporation duly
organized and validly existing; (b) this Agreement has been duly executed on
behalf of Intracel; (c) this Agreement is a legal, valid and binding obligation
of Intracel; and (d) execution and performance of this Agreement does not
violate any contract, agreement, regulatory ruling, or judicial order to which
Intracel is subject, or to the best of Intracel's knowledge, violate any law.
5. PAYMENT FOR SERVICES
5.1 SERVICE FEE
In return for the Services, Intracel shall pay to Lehigh a monthly service
fee ("SERVICE FEE") payable in arrears at the end of each month during the
Term. The Service Fee shall be $6,250 per month. The Parties agree (i) that the
Service Fee reflects the fair market value for the Services, and (ii) that
Intracel shall annually adjust the Service Fee to reflect the fair market value
of the Services.
5.2 EXPENSES
Subject to reasonable Intracel policies, including advance approval by
Intracel, and up to the reasonable dollar limits specified from time to time by
Intracel, Lehigh shall be entitled to reimbursement by Intracel for reasonable
expenses (including but not limited to reasonable travel expenses) incurred by
Medical Director during the Term of this Agreement in performance of the
Services and upon the presentation of appropriate documentation. It is intended
that all expenses incurred pursuant to this Section 5.2 are to be ordinary and
necessary business expenses. It is therefore agreed that if any expense paid
for, or reimbursed to, Lehigh is disallowed by the Internal Revenue Service as
a federal income tax deduction of Intracel, (1) Intracel shall not be obliged
to contest such ruling, and (2) Lehigh shall reimburse Intracel for such
disallowed expense within sixty (60) days after the final determination of such
disallowance.
6. TERM AND TERMINATION
6.1 TERM
The term of this Agreement (the "TERM") shall commence on the Initial
Closing Date, as that term is defined in the Joint Venture Agreement (the
"EFFECTIVE DATE") and shall end, unless earlier terminated in accordance with
this Section 6, on the Final Closing Date, as that term is defined in the Joint
Venture Agreement.
6
179
6.2 TERMINATION BY INTRACEL
Intracel may terminate this Agreement for Cause at any time during the
Term of this Agreement by giving Lehigh written notice at least thirty (30)
days in advance (the "NOTICE PERIOD") of the effective date of such termination
(the "TERMINATION DATE"). Intracel may (without alteration of payment
obligations under this Agreement during the Notice Period) require that Medical
Director cease his performance of the Services at any time during the Notice
Period. The following shall be Cause for termination pursuant to this Section
6.2 (i) Lehigh itself, or through Medical Director, breaches or fails to
perform a material obligation under this Agreement and that breach or failure
is not cured to the reasonable satisfaction of Intracel within the Notice
Period; (ii) any act or omission constituting fraud or material
misrepresentation by Lehigh or Medical Director in dealing with Intracel or the
OncoVax Center; (iii) Medical Director's license to practice medicine is
suspended, limited or revoked, irrespective of other proceedings, or Medical
Director's DEA license to prescribe controlled substances is revoked, limited
or suspended; (iv) Medical Director is suspended or barred from participation
in Medicare; (v) Xxxxxxx X. Xxxxxx, Xx. is no longer the Medical Director
performing the Services on behalf of Lehigh, or he becomes disabled to the
extent that he is unable to perform the Services; (vi) Medical Director becomes
ineligible for professional liability coverage on commercially reasonable
terms; (vii) Lehigh is adjudged insolvent or bankrupt or makes a general
assignment for the benefit of creditors; or (viii) Medical Director is
convicted of a crime bearing on the practice of medicine, any crime involving
moral turpitude or fraud, or Medical Director is convicted of any felony.
6.3 TERMINATION BY LEHIGH
Lehigh may terminate this Agreement for Cause at any time during the Term
of the Agreement by giving Intracel written notice at least thirty (30) days in
advance (the "NOTICE PERIOD") of the effective date of such termination (the
"TERMINATION DATE"). The following shall be Cause for termination pursuant to
this Section 6.3 (i) Intracel becomes insolvent or bankrupt or makes a general
assignment for the benefit of creditors; (ii) Intracel breaches or fails to
perform any material obligation under this Agreement, and such breach or
failure is not cured to the reasonable satisfaction of Lehigh within the Notice
Period; or (iii) Intracel commits fraud or material misrepresentation in its
dealings with Lehigh or Medical Director.
6.4 TERMINATION BY EVENT
Unless the Parties agree in writing to continue this Agreement, this
Agreement shall automatically terminate upon the occurrence, at any time, of
any of the following events: (i) the termination for any reason of the Joint
Venture Agreement, or (ii) in accordance with and only in accordance with the
provisions of Section 8.5, in the event this Agreement is deemed in the
reasonable opinion of either Party to violate law and be incapable of amendment.
7
180
6.5 COOPERATION
In the event of the expiration or termination of this Agreement for any
reason, Lehigh and Medical Director shall, without further compensation, if so
requested by Intracel, thereafter, promptly (a) respond to requests for
information as reasonably may be necessary to ensure appropriate transfer of
their responsibilities; and (b) advise Intracel if either receives a complaint,
summons, subpoena, or similar court order for records or testimony relating to
performance of the Services.
7. CONFIDENTIALITY
7.1 CONFIDENTIALITY
During the course of Lehigh's performance of the Services, Lehigh and/or
Medial Director may come to know certain confidential and proprietary business
or medical information of or about Intracel, the OncoVax Center, and/or
Intracel affiliates and joint venture partners (collectively, "ENTITIES"),
including but not limited to information concerning (a) business, affairs or
operations of the Entities or their customers, (b) entity trade secrets, new
product developments, special or unique processes, protocols, or methods, (c)
Entity marketing, sales, advertising or other concepts or plans, (d) Entity
fees and billing arrangements, (e) Entity finances, (f) Entity management
systems, or (g) entity business plans or prospects ("CONFIDENTIAL
INFORMATION"). The term "Confidential Information" shall exclude any
information that is a matter of public knowledge (except if such public
knowledge resulted form an improper act of Medical Director or Lehigh). Lehigh
agrees that both during the Term of this Agreement and after the expiration or
termination of this Agreement for whatever reason, Lehigh shall hold all such
Confidential Information in the strictest confidence, and shall not disclose,
use, or display, transfer, sell, publish, or otherwise make available to any
other person or entity, any such Confidential Information without the prior
written consent of Intracel, except as may be specifically required by law.
Lehigh shall protect such Confidential Information in a manner consistent with
the usual manner in which the most confidential business and professional
information is protected. Lehigh shall ensure that Medical Director complies
with the provisions of this Section 7.1.
7.2 ENFORCEMENT OF CONFIDENTIALITY REQUIREMENTS
Lehigh agrees that the restrictions contained in Section 7.1 are part of
the consideration for inducing the Intracel to contract with Lehigh to provide
the Services for the fees provided for in this Agreement; that such
restrictions are reasonable and necessary to protect the business interests of
Intracel and the OncoVax Center; and that any violation of such restrictions
will cause substantial and irreparable injury to the Intracel and/or the
OncoVax Center. These restrictions shall be effective and enforceable upon the
execution of this Agreement by Lehigh, irrespective of the
8
181
length of its Term. The Parties agree that Intracel and the OncoVax Center each
are entitled, in addition to any and all other remedies available at law or in
equity, to a restraining order, preliminary and permanent injunctive relief and
specific performance to prevent a breach or contemplated breach of these
restrictions, without the necessity of proving actual damages. In the event of
a breach of these provisions, Lehigh shall be obligated to pay all costs and
expenses, including reasonable attorneys' fees, incurred by Intracel or the
OncoVax Center due to such breach or threatened breach.
7.3 NO ACQUIRED INTERESTS
Lehigh and Medical Director agree that upon termination or expiration
of this Agreement, all proprietary interest of Intracel or the OncoVax Center
in OncoVax or its other products, in customer accounts, lists, copyrighted
items, trade secrets, proprietary information, including all intellectual
property rights in any materials, documents, protocols, systems, reports, or
inventions, and all business assets, tangible or intangible (collectively
"PROPRIETARY INTERESTS"), with which Lehigh or Medical Director deals or has
access to, or that are developed or improved in whole or in part by Lehigh or
Medical Director in performing the Services during the Term of this Agreement,
shall remain the sole and exclusive property of Intracel and/or the OncoVax
Center, and in no event shall Lehigh or Medical Director, by virtue of
performing the Services, acquire any personal interest in the Proprietary
Interests or any right to use the Proprietary Interests except as specifically
set forth in a license agreement or other agreement executed by the Parties.
Lehigh and Medical Director each hereby assign to Intracel all of Lehigh's or
Medical Director's right, title and interest, including all intellectual
property rights, if any, in any Proprietary Interests developed in whole or in
part by Lehigh or by Medical Director in performance of the Services, which
Proprietary Interests all shall be considered works made for hire. Lehigh and
Medical Director agree that upon termination or expiration of this Agreement
each shall promptly return to Intracel all business, corporate, medical or
financial records, documents, forms, contracts, lists and completed work or
work in progress relating to the affairs of Intracel or the OncoVax Center and
any personal property of Intracel or the OncoVax Center in their possession at
the time of termination or expiration.
8. GENERAL PROVISIONS
8.1 NOTICES
All notices and other communications under this Agreement shall be in
writing and shall be deemed given when delivered personally, sent by federal
express or other recognized overnight delivery service or mailed by registered
or certified mail, return receipt requested, to the Parties as follows or to
such other addressee as a party may in writing designate.
9
182
If to Lehigh:
Lehigh Valley Hospital and Health Network
Xxxxx Xxxxx & X-00
X.X. Xxx 000
Xxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attn: Xxxxx X. Xxxxxxxxx
Facsimile: (000)000-0000
with a copy to:
Xxxxxxx, Xxxxxxx & Xxxxxxxxxx
The Paragon Centre
0000 Xxxx Xxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attn: Xxxxxxx X. Xxxxxxxxxx, Esq.
Facsimile: (000)000-0000
If to Intracel or OncoVax Center:
Intracel Corporation
0000 Xxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxx X. Xxxxx
Facsimile: (000)000-0000
with a copy to:
Xxxxx Xxxxxxx, Esq.
Xxxxx & Xxxxxxx, L.L.P.
000 00xx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
Facsimile: (000)000-0000
Each notice, demand, request or communication that shall be given or made
in the manner described in this Section 8.1 shall be deemed sufficiently given
or made for all purposes at such time as it is delivered to the addressee (with
the return receipt, the delivery receipt, or the affidavit of messenger being
deemed conclusive but not exclusive evidence of such delivery) or at such time
as delivery is refused by the addressee upon presentation. This Section 8.1
shall survive termination of this Agreement.
10
183
8.2 ENTIRE AGREEMENT; AMENDMENTS
This Agreement sets forth the entire understanding and agreement between
the parties with respect to the subject matter of this Agreement, and
supersedes all prior undertakings of any kind, whether written or oral. No
terms, conditions, or warranties, other than those contained in this Agreement,
and no amendments or modifications to this Agreement, shall be valid unless
made in writing and signed by the Parties.
8.3 EFFECT AND BENEFIT OF AGREEMENT
This Agreement shall be binding upon and inure to the benefit of the
Parties and their respective successors and permitted assigns. The covenants,
undertakings, and agreements set forth in this Agreement shall be solely for
the benefit of, and shall be enforceable only by, the Parties and their
permitted assigns, respective heirs, successors or legal representatives.
Nothing in this Agreement is intended to or shall be construed to, confer upon
any person or entity not a Party to this Agreement, any rights or benefits
under this Agreement.
8.4 ASSIGNMENT
This Agreement and its performance shall not be assigned, sublet,
delegated or transferred by either Party in whole or in part without the prior
written consent of the other party, except that Intracel shall have the right
to assign or delegate its rights and responsibilities under this Agreement, in
whole or in part, without Lehigh's consent, to the OncoVax Center (or successor
entity) or to any affiliate or subsidiary of, or successor entity to, Intracel.
8.5 INVALID PROVISIONS
If any provision of this Agreement or other document contemplated in this
Agreement is held to be illegal, invalid, or unenforceable under present or
future laws, such provisions shall be fully severable: (a) the appropriate
documents shall be construed and enforced as if such illegal, invalid, or
unenforceable provision had never comprised a part of the Agreement; (b) the
remaining provisions shall remain in full force and effect and shall not be
affected by the illegal, invalid or unenforceable provision; and (c) the
Parties shall in good faith negotiate and substitute a provision as similar in
terms to such illegal, invalid, or unenforceable provision as may be possible
and still be legal, valid and enforceable, unless the effect of such severance
and substitution would be to deprive a Party substantially of the benefits
contemplated under this Agreement, in which case either Party may terminate
this Agreement upon thirty days written notice to the other Party.
11
184
8.6 INDEPENDENT CONTRACTORS
The Parties acknowledge and agree that, with respect to this Agreement
and the arrangements set forth in this Agreement, they are independent
contractors and that except as provided in this Agreement, neither Party has
the right to obligate or bind the other Party in any manner whatsoever. Nothing
in this Agreement shall be interpreted, or is intended, to constitute either
Party as the employee or employer, joint venturer, or partner of the other
Party. The Parties understand and agree that (a) Intracel will not withhold on
behalf of Medical Director any sum for income tax, unemployment insurance,
social security or any other withholding applicable to employees, and Intracel
will not provide Medical Director with any of the benefits provided to
employees of Intracel or its affiliates, (b) as between Intracel and Lehigh,
all such payments, withholdings and benefits, if any, shall be the sole
responsibility of Lehigh; and (c) Lehigh will indemnify and hold Intracel
harmless from any and all loss or liability, cost or expense arising with
respect to any such payments, withholds, and benefits.
8.7 ACCESS TO BOOKS AND RECORDS
Until the expiration of six (6) years after expiration or termination
of this Agreement, Intracel and Medical Director each shall make available to
the Secretary, U.S. Department of Health and Human Services, the U.S.
Comptroller General and their representatives, this Agreement and all books,
documents and records necessary to certify the nature and extent of the costs
of the services furnished hereunder and will provide such additional
documentation as they reasonably require. If Medical Director carries out any
of the duties of this Agreement through a subcontract worth ten thousand
dollars ($10,000) or more over a twelve month period with a related
organization, the subcontract will also contain a clause to permit access by
the Secretary, Comptroller General, and their representatives to the related
organization's books and records. This Section 8.7 shall survive termination of
this Agreement.
8.8 REMEDIES
Any remedies the Parties may have pursuant to this Agreement or by
law shall be cumulative.
8.9 NO WAIVER
The waiver by either Party of any breach of any provision of this
Agreement shall not be construed as a waiver of any subsequent breach of the
same or another provision. The failure to exercise any right under this
Agreement shall not operate as a waiver of such right. Any waiver must be in
writing and signed by the Party to be charged.
12
185
8.10 GOVERNING LAW
This Agreement, to the extent any particular issue is controlled by
state law, shall be governed by and construed in accordance with the laws of the
State of Maryland (but not including choice of law rules thereof).
8.11 COUNTERPARTS
This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but which together shall constitute one and
the same Agreement.
13
186
IN WITNESS WHEREOF, each of the Parties intending to be legally bound has
caused this Agreement to be duly executed and delivered in its name and on its
behalf as of the date first set forth above.
INTRACEL CORPORATION
By: _________________________________
Name: _______________________________
Title: ______________________________
LEHIGH VALLEY HOSPITAL AND
HEALTH NETWORK
By: _________________________________
Name: _______________________________
Title: ______________________________
ACKNOWLEDGED AND AGREED:
XXXXXXX X. XXXXXX, XX., M.D.
By: _________________________________
ACKNOWLEDGED AND AGREED:
XXXXX XXXXXXX, M.D.
By: _________________________________
14
187
EXHIBIT P-1
CERTIFICATE OF
REPRESENTATIONS AND WARRANTIES OF INTRACEL
In order to induce Lehigh Valley Hospital and Health Network ("LEHIGH") to
enter into the Joint Venture Agreement (the "AGREEMENT") to which this Exhibit
P-1 is attached, Intracel Corporation ("INTRACEL") makes the following
representations and warranties each of which is material to and is being relied
upon by Lehigh:
1. ORGANIZATION AND STANDING.
Intracel is a corporation duly incorporated, validly existing, and in
good standing under the laws of the State of Delaware and has all requisite
power and authority, corporate and otherwise, to own, operate, and lease its
properties and to carry on its business as currently conducted, to execute and
deliver the Agreement and all other agreements and instruments contemplated
thereby and to carry out the transactions contemplated thereby.
2. AUTHORITY AND POWER.
Intracel has full legal right, power and authority to execute and
deliver the Agreement and all other agreements and instruments contemplated
thereby and to consummate the transactions as contemplated thereby in
accordance with the terms and conditions thereof.
3. AUTHORIZATION.
Intracel has taken all corporate action necessary for Intracel to enter
into the Agreement and all other agreements and instruments contemplated
therein and for Intracel to consummate the transactions contemplated therein in
accordance with the terms thereof.
4. ABSENCE OF VIOLATIONS.
The execution, delivery, and performance by Intracel of the Agreement
and all other agreements and instruments contemplated thereby, the fulfillment
of and the compliance with the respective terms and provisions thereof, and the
consummation of the transactions contemplated therein, do not and will not: (i)
conflict with, or violate any provision of, any statute, law, rule, regulation,
order,
188
judgment, injunction, decree, or award of any arbitrator or governmental
authority having applicability to Intracel or any of its business, assets, or
properties or to any Subsidiary (as defined in the Agreement) of Intracel, or
any provision of the Articles of Incorporation, Bylaws or similar governing
instruments of Intracel or (ii) conflict with, violate, or result in any breach
of, or constitute a default under, any indenture or loan or credit agreement or
any other agreement, to which Intracel is a party or by which Intracel or any
of its business, assets or properties or any Subsidiary of Intracel may be
bound or affected, except for such conflicts, violations, breaches, or defaults
which shall not individually or in the aggregate have a material adverse effect
upon Intracel or upon Intracel's ability to consummate the transactions
contemplated therein.
5. CONSENTS AND APPROVALS.
Intracel is not subject to any statute, law, regulation, rule, order,
judgment, injunction, decree, charter, bylaw, mortgage, deed of trust,
indenture, agreement, or other restriction of any kind or character whatsoever
which (i) would prevent the execution or delivery or performance by Intracel of
the Agreement or any other agreement or instrument contemplated thereby or the
consummation by Intracel of any of the transactions contemplated thereby; or
(ii) would require approval of, or filing with, any governmental or regulatory
authority for the execution, delivery, and performance by Intracel of the
Agreement or any other agreement or instrument contemplated thereby and the
consummation by Intracel of all the transactions contemplated thereby. Intracel
has obtained all consents and approvals which are necessary to permit the
consummation by Intracel of the transactions contemplated in the Agreement or
in any other agreement or instrument contemplated thereby.
6. COMPLIANCE WITH APPLICABLE LAWS.
Intracel has complied in all material respects and remains in
material compliance with all statutes, laws, ordinances, regulations, rules,
orders, determinations, writs, injunctions, awards, judgments, and decrees
applicable to Intracel or to the assets, properties, employees, agents, and
business of Intracel.
7. BINDING OBLIGATION.
The Agreement constitutes a valid and binding obligation of Intracel,
enforceable in accordance with its terms, and each document and instrument to
be executed by Intracel pursuant hereto, when executed and delivered in
accordance with the provisions thereof, shall be a valid and binding obligation
of Intracel, enforceable in accordance with its terms.
2
189
8. LICENSES, ACCREDITATION AND REGULATORY MATTERS.
Intracel and all its professional employees or agents hold, or have
applied for, all material licenses, certificates of need or other regulatory
approvals which are needed or required by law with respect to its business,
operation and facilities as presently conducted and as contemplated under the
Agreement ("LICENSES"). To the extent such Licenses have been issued, such
Licenses are in full force and effect, and Intracel is in compliance in all
material respects with all conditions and requirements of such Licenses and
with all laws, rules and regulations relating thereto. Any and all past
litigation concerning such issued Licenses, and all claims and causes of action
raised therein, has been finally adjudicated. No such issued License has been
revoked, conditioned (except as may be customary) or restricted, and no action
(equitable, legal or administrative), arbitration or other process is pending,
or to the best knowledge of Intracel, threatened, which in any way challenges
the validity of, or seeks to revoke, condition or restrict any such License.
IN WITNESS WHEREOF, the undersigned has duly executed and delivered
this Certificate of Representations and Warranties of Intracel as of December
__, 1998.
INTRACEL CORPORATION
By:_____________________________
Name:___________________________
Title:__________________________
3
190
EXHIBIT P-2
CERTIFICATE OF
REPRESENTATIONS AND WARRANTIES OF LEHIGH
In order to induce Intracel Corporation ("INTRACEL") to enter into the
Joint Venture Agreement (the "AGREEMENT") to which this Exhibit P-2 is
attached, Lehigh Valley Hospital and Health Network ("LEHIGH") makes the
following representations and warranties each of which is material to and is
being relied upon by Intracel:
1. ORGANIZATION AND STANDING.
Lehigh is a non-profit corporation duly incorporated, validly
existing, and in good standing under the laws of the Commonwealth of
Pennsylvania and has all requisite power and authority, corporate and
otherwise, to own, operate, and lease its properties and to carry on its
business as currently conducted, to execute and deliver the Agreement and all
other agreements and instruments contemplated thereby and to carry out the
transactions contemplated thereby.
2. AUTHORITY AND POWER.
Lehigh has full legal right, power and authority to execute and
deliver the Agreement and all other agreements and instruments contemplated
thereby and to consummate the transactions as contemplated thereby in
accordance with the terms and conditions thereof.
3. AUTHORIZATION.
Lehigh has taken all corporate action necessary for Lehigh to enter
into the Agreement and all other agreements and instruments contemplated
therein and for Lehigh to consummate the transactions contemplated therein in
accordance with the terms thereof.
4. ABSENCE OF VIOLATIONS.
The execution, delivery, and performance by Lehigh of the Agreement
and all other agreements and instruments contemplated thereby, the fulfillment
of and the compliance with the respective terms and provisions thereof, and the
consummation of the transactions contemplated therein, do not and will not:
(i) conflict with, or violate any provision of, any statute, law, rule,
regulation, order, judgment, injunction, decree, or award of any arbitrator or
governmental authority having applicability to Lehigh or any of its business,
assets, or properties or to any
191
Subsidiary (as defined in the Agreement) of Lehigh, or any provision of the
Articles of Incorporation, Bylaws or similar governing instruments of Lehigh or
(ii) conflict with, violate, or result in any breach of, or constitute a
default under, any indenture or loan or credit agreement or any other
agreement, to which Lehigh is a party or by which Lehigh or any of its
business, assets or properties or any Subsidiary of Lehigh may be bound or
affected, except for such conflicts, violations, breaches, or defaults which
shall not individually or in the aggregate have a material adverse effect upon
Lehigh or upon Lehigh's ability to consummate the transactions contemplated
therein.
5. CONSENTS AND APPROVALS.
Lehigh is not subject to any statute, law, regulation, rule, order,
judgment, injunction, decree, charter, bylaw, mortgage, deed of trust,
indenture, agreement, or other restriction of any kind or character whatsoever
which (i) would prevent the execution or delivery or performance by Lehigh of
the Agreement or any other agreement or instrument contemplated thereby or the
consummation by Lehigh of any of the transactions contemplated thereby; or (ii)
would require approval of, or filing with, any governmental or regulatory
authority for the execution, delivery, and performance by Lehigh of the
Agreement or any other agreement or instrument contemplated thereby and the
consummation by Lehigh of all the transactions contemplated thereby. Lehigh has
obtained all consents and approvals which are necessary to permit the
consummation by Lehigh of the transactions contemplated in the Agreement or in
any other agreement or instrument contemplated thereby.
6. COMPLIANCE WITH APPLICABLE LAWS.
Lehigh has complied in all material respects and remains in material
compliance with all statutes, laws, ordinances, regulations, rules, orders,
determinations, writs, injunctions, awards, judgments, and decrees applicable
to Lehigh or to the assets, properties, employees, agents, and business of
Lehigh.
7. BINDING OBLIGATION.
The Agreement constitutes a valid and binding obligation of Lehigh,
enforceable in accordance with its terms, and each document and instrument to
be executed by Lehigh pursuant hereto, when executed and delivered in
accordance with the provisions thereof, shall be a valid and binding obligation
of Lehigh, enforceable in accordance with its terms.
2
192
8. LICENSES, ACCREDITATION AND REGULATORY MATTERS.
Lehigh and its Subsidiaries and all professional employees or
agents of each hold all material licenses, certificates of need or other
regulatory approvals which are needed or required by law with respect to their
respective businesses, operations and facilities as presently conducted and as
contemplated under the Agreement ("LICENSES"). All such Licenses are in full
force and effect, and each of Lehigh and its Subsidiaries is in compliance in
all material respects with all conditions and requirements of the Licenses and
with all laws, rules and regulations relating thereto. Any and all past
litigation concerning such Licenses, and all claims and causes of action raised
therein, has been finally adjudicated. No such License has been revoked,
conditioned (except as may be customary) or restricted, and no action
(equitable, legal or administrative), arbitration or other process is pending,
or to the best knowledge of Lehigh, threatened, which in any way challenges the
validity of, or seeks to revoke, condition or restrict any such License. Lehigh
and its Subsidiaries are, to the extent applicable to their operations, (i)
eligible to receive payments under Titles XVIII and XIX of the Social Security
Act for covered services furnished to eligible beneficiaries by physicians
employed by a hospital, (ii) suppliers under existing supplier agreements with
the Medicare program through applicable Medicare contractors and (iii) in
compliance in all material respects with the applicable conditions of
participation in the Medicare program and the third party payor contracts to
which they are a party. Lehigh and its Subsidiaries have timely filed all
requisite, claims and other reports required to be filed in connection with the
Medicare or Medicaid programs and, other governmental health programs, or by
third party payors contracts which were due on or before the date hereof, all of
which were, when filed, complete and correct in all material respects. There are
no current claims, actions or appeals pending, and neither Lehigh nor its
Subsidiaries have filed any claims or reports which would be reasonably likely
to result in such claims, actions or appeals, before any commission, board or
agency, including, without limitation, any Medicare carrier or the Administrator
of the Health Care Financing Administration with respect to any Medicare claims,
or any disallowances in connection with any audit of such which would be
reasonably likely to have a material adverse effect on Lehigh or its
Subsidiaries in the aggregate. To the best of the Lehigh's knowledge, neither
Lehigh nor its Subsidiaries nor their respective employees or shareholders have
committed a violation of the Medicare or Medicaid fraud and abuse provisions of
the Social Security Act or have violated the terms of the third party payor
contracts to which they are a party.
3
193
IN WITNESS WHEREOF, the undersigned has duly executed and delivered
this Certificate of Representations and Warranties of Lehigh Valley Hospital
and Health Network as of December __, 1998.
LEHIGH VALLEY HOSPITAL
\ AND HEALTH NETWORK
By:
-------------------------------
Name:
-----------------------------
Title:
----------------------------
4
