<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) December 8, 1997
EuroMed, Inc.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Nevada 0-27720 88-031770
--------- ----------- ------------------
(State or other jurisdiction (Commission (IRS Employer
of incorporation File Number) Identification No.)
Wilhelminakanaal Noord 6, NL 4902VR Oosterhout, The Netherlands
------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 011-31-16-243-7440
------------------
<PAGE> 2
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
On December 8, 1997, EuroMed, Inc. (the "Company") consummated the sale of
80% of the capital stock of its wholly-owned subsidiary EuroMed Europe, Inc.
("Subsidiary"), the holding company for the Company's operating subsidiaries, to
Neopharm B.V., a Dutch pharmaceutical company. The purchase price for the
capital stock consisted of cash in the amount of $1 million, ($330,000 of which
has been paid, and the remaining $670,000 of which will be paid following
approval by the Dutch government of an increase in Subsidiary's share capital),
the retainment of a loan made by the Company to Subsidiary in the amount of
approximately $300,000, and the assignment to the Company of a claim of
approximately $500,000 against the purchaser of the Company's assets in
Pluripharm International B.V. In addition, the Company agreed to indemnify the
purchaser and its affiliates from any claims made by Gregory Gaylor.
Additionally, the Company and its subsidiaries have entered into a
Settlement Agreement with A. Francois Hinnen and his affiliates, whereby, among
other things, Mr. Hinnen's affiliate will return to the Company 1,850,000 shares
of the Company's common stock (850,000 of which were previously canceled by the
Company), Mr. Hinnen will resign as a director of the Company and Mr. Hinnen and
his affiliates will resign as managers of the Company's operating subsidiaries,
in consideration for which such subsidiaries transferred to Mr. Hinnen title to
the Company's 51% interest in Confedera Philippines, Inc. and title to an
automobile and personal computer being utilized by Mr. Hinnen. In addition, each
party agreed to release each other for any claims they may have against each
other, and the Company agreed to indemnify Mr. Hinnen and his affiliates from
certain actions or events, except for claims arising from the unlawful action or
omission for which Hinnen and his affiliates may be blamed personally.
Consummation of the above Settlement Agreement is subject to certain conditions
precedent, which the Company believes will be satisfied in the near future.
The transactions set forth above were negotiated by the parties at
arms-length. To the best knowledge of the Company, there is no material
relationship between Neopharm and the Company or any of its affiliates, any
director or officer of the Company, or any associate of such director or
officer.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(b) Pro forma Financial Information for the Transaction.(1)
(i) Pro forma Condensed Balance Sheet.
(ii) Pro forma Condensed Consolidated Statement of
Income.
2
<PAGE> 3
(c) Exhibits.
The following is a list of exhibits filed as part of this Current Report on
Form 8-K:
Exhibit No. Description
----------- -----------
2.1 Purchase Agreement by and between EuroMed, Inc. and
Neopharm B.V. dated November 26, 1997.*
2.2 Settlement Agreement.*
27.1 Financial Data Schedule.(1)
- ------------------
* Filed herewith.
(1) It is impractical for the registrant to file such financial
statements and related financial data schedule at this time. Such
financial statements and related financial data schedule will be filed
under cover of Form 8-K/A as soon as practicable, but no later than 60
days after the date by which this report on Form 8-K was required to be
filed.
3
<PAGE> 4
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
EUROMED, INC.
Date: December 23, 1997 By: /S/ E. Gene Tindell
------------------------
E. Gene Tindell
Chief Executive Officer
4
<PAGE> 5
INDEX TO EXHIBITS
Exhibit No. Description
2.1 Purchase Agreement by and between EuroMed, Inc.
and Neopharm B.V. dated November 26, 1997.*
2.2 Settlement Agreement.*
27.1 Financial Data Schedule.(1)
- ------------------
* Filed herewith.
(1) It is impractical for the registrant to file such financial
statements and related financial data schedule at this time.
Such financial statements and related financial data schedule
will be filed under cover of Form 8-K/A as soon as
practicable, but no later than 60 days after the date by which
this report on Form 8-K was required to be filed.
5
<PAGE> 1
EXHIBIT 2.1
PURCHASE AGREEMENT
relating to the purchase of 80% of the issued
and outstanding shares in
EUROMED EUROPE B.V.
by
NEOPHARM B.V.
<PAGE> 2
PURCHASE AGREEMENT
THE UNDERSIGNED:
- ---------------
1. NEOPHARM B.V., a private company with limited liability with seat at
Groningen, duly represented by Mr. M. Rijkeboer, hereinafter referred to as
"the Purchaser";
AND
2. EUROMED, INC. , a public company incorporated under the laws of Nevada,
United States of America, duly represented by its CEO, Mr. E.G. Tindell,
hereinafter referred to as "the Vendor";
TAKING INTO CONSIDERATION:
- -------------------------
A. EUROMED EUROPE B.V., hereinafter referred to as "the Company", is a closed
company with limited liability incorporated under the laws of the
Netherlands, with statutory seat at Oosterhout, the Netherlands, with an
issued and paid-up share capital consisting of 400 shares with a nominal
value of Dfl l00 each (hereinafter referred to as "the Shares").
B. The Company is the direct owner of subsidiary companies and affiliate
companies as defined below.
C. The Vendor is the sole owner of the Shares.
D. The Vendor wishes to sell 80% of the Shares (this 80% hereinafter referred
to as "the Sale Shares") and the Purchaser wishes to buy the Sale Shares
under the conditions as set forth hereinafter.
NOW IT IS HEREBY AGREED AS FOLLOWS:
- ----------------------------------
1. Sale and Purchase
1.1. The Vendor hereby sells to Purchaser and the Purchaser hereby
purchases from Vendor the Sale Shares, with numbers 1 up and including
320 free from all liens, charges and encumbrances and with all rights
attaching to them.
-2-
<PAGE> 3
1.2. Legal title to, and any risk attaching to, the Sale Shares shall pass
on Completion Date to Purchaser.
2. Purchase Consideration
----------------------
2.1. The total purchase consideration for the Sale Shares ("the Purchase
Price") is US $1,000,000 (one million United States dollars).
3. Completion
----------
3.1. Completion shall take place on such date as shall be mutually agreed
by the Purchaser and the Vendor being not later than December 15, 1997
("the Completion Date") in the offices of Boekel De Neree, 3037
Strawinskylaan, Amsterdam the Netherlands.
3.2. On the Completion Date, the Purchaser and the Vendor shall execute a
notarial Deed of Transfer in favor of the Purchaser. The Vendor shall
procure that the Company shall acknowledge such transfer of the Sale
Shares by co-signing the Deed of Transfer.
3.4. Until Completion Date, Vendor warrants that the Company shall not
resolve to any material changes of its policy, strategies,
transactions or matters outside the ordinary course of business of the
Company, unless with the prior approval of Purchaser.
4. Payment of the Purchase Price
-----------------------------
4.1. On the Completion Date, the Purchase Price shall be paid by telephone
bank transfer to Vendor in accordance with instructions given by
Vendor. Prior to completion, an amount equal to the Purchase Price
shall be transferred to the third party account of the Notary. Payment
made by the Notary to Vendor in accordance with the instructions given
to the Notary, will discharge Purchaser for its obligations under this
Article 4.1.
5. Guarantees
----------
It is agreed and acknowledged that with respect to the Sale Shares and
the Company, Vendor does not give any representation, warranty or
guarantee whatsoever except those which are mentioned in this article.
The Vendor guarantees ("garandeert") to the Purchaser that each of the
following statements is true and accurate as of today and as at the
Completion Date, save as properly disclosed in writing to the
Purchaser, subject to Article 8.3 of this Agreement.
-3-
<PAGE> 4
As far as the Guarantees are given with regard to the Company, it is
implied that such guarantees are equally applicable to any of the
subsidiary or affiliated companies of the Company.
A. STATUS OF THE COMPANY
---------------------
5.1. The Company was incorporated by a notarial deed on 28 December 1995
and is registered with the Trade Registry of the Chamber of Commerce
and Industry for Westelijk Noord Brabant (Breda), the Netherlands,
under file number 79000. A Trade Registry Extract with respect to the
Company is attached to this Agreement as Exhibit 1 and is correct and
up to date in every respect. The Articles of Association of the
Company as presently in force are attached as Exhibit 2.
5.2. The Company is the owner of the following shares in the subsidiary and
affiliated companies:
-- Confedera B.V. (100%);
-- Galenica B.V. (100%);
-- Mutarestes B.V. (100%);
Mutarestes B.V. is the owner of 100% of the shares in Pluripharm
International B.V. Pluripharm International B.V. is the owner of 100%
of the shares in Financieringsmaatschappij de Nieuwe Wereld B.V. The
Company owns such shares including the voting rights thereto, free
and clear of any liens, security interests, charges, claims, options,
rights of first refusal, other than as appearing from the articles of
association of the relevant companies or shareholders or similar
agreements, as provided for in Exhibit 3.
5.3. The Company, through its subsidiary and affiliated companies, carries
on activities, in the field of wholesale of pharmaceutical products.
5.4. On Completion Date, the Sale Shares are free of any liens or charges,
and no depositary receipts ("certification") have been issued in
respect of them and the Vendor has free title to the Sale Shares. The
Sale Shares constitute 80% of the issued and outstanding share-capital
of the Company. The Sale Shares are fully paid-up, unencumbered and
free of any claims by third parties.
5.5 Neither the Company nor the Vendor has issued any outstanding options
or other rights to any person to acquire shares in the Company.
5.6. The Company has not issued to any person a right to share in its
profit, such as, but not limited to profit-sharing agreements and
staff bonuses.
-4-
<PAGE> 5
5.7. The Vendor has the power ("bevoegdheid") to enter into this
Agreement and to perform the obligations expressed to be assumed by it
and has taken all necessary corporate action to authorize the
execution and performance of this Agreement.
B. MANAGEMENT BOARD; POWERS OF ATTORNEY
------------------------------------
5.8. The Company has not granted any power of attorney or similar authority
to any person including, without limitation, any power of attorney or
similar authority to commit the Company in any way or to dispose of
assets of the Company or to operate any bank facilities, except as
mentioned in the Trade Registry Extract (attached as Exhibits 1 and
3).
C. INSOLVENCY
----------
5.9. No order has been made and no resolution has been passed for the
winding up of the Company and no meeting has been convened for the
purpose of the winding up of the Company.
5.10 No bankruptcy order has been made and no petition for such an order
has been presented in respect of the Company. No receiver
bewindvoerder) has been appointed in respect of the Company of all or
any of its assets. The Company is not insolvent. No distress
execution or other process has been levied on any of the Company's
assets or action taken to repossess goods in the Company's possession.
Purchaser is aware that Confedera B.V. and Galenica B.V. have been
granted temporarily "surseance van betaling" (suspension of payment)
by the relevant District Courts of Utrecht en Breda on 19 November
1997.
6. Breach of Guarantees
--------------------
6.1. All liabilities of the vendor arising as a result of any matter which
is subject of the warranties as referred to in Article 5 shall
terminate on the expiry of a period of I year as from the Completion
Date, except if the Purchaser has delivered any claim in writing,
stating description of facts and circumstances and the amount claimed,
to the Vendor prior to such times.
6.2. The Vendor's liability for damage with respect to the aforementioned
Guarantees is maximized up to the total of the Purchase Price as
determined above in Article 2 of this Agreement.
6.3. In the event of breach of any of the Guarantees by the Vendor or a
default by the Vendor of any other obligation contemplated by in this
Agreement, the Vendor or the Purchaser, as the case may be, shall upon
obtaining knowledge thereof notify the other party promptly in
writing. If such party has not taken appropriate measures
-5-
<PAGE> 6
within 30 days of such notification in order to remedy the breach or
default concerned, and a dispute arises in this respect between the
parties, then the affected party shall be entitled to institute
proceedings pursuant to Article 14 of this Agreement.
7. Confidentiality
---------------
7.1 Vendor undertakes not to provide to any other person or use any
information regarding the Company, which information it knows or
should know is secret or confidential, or the distribution of which
may cause damage to Purchaser and/or the Company, unless it is
required to do so by virtue of or pursuant to statue or applicable
regulations or the requirements of any governmental or regulatory
body, provided that Vendor shall not disclose any such information
without the prior consultation with Purchaser, unless this
consultation is prevented by law.
8. Further Covenants
-----------------
8.1. Upon signing this Agreement, Purchaser undertakes to restore the
credit facility of both Galenica B.V. and Confedera B.V. to the extent
necessary to secure the support of the court appointed administrator
("bewindvoerder") for petitioning the relevant District Courts to
withdraw the temporarily granted "surseance van betaling" of Confedera
B.V. and Galenica B.V.
8.2. Ultimately on Completion Date Vendor shall resign as statutory
director of the Company and its subsidiary companies, as the case may
be, effective the Completion Date.
Vendor shall undertake that Mr. Hinnen, B.V. Wisteria and/or
Pantapharma B.V. shall resign as statutory director of the Company and
its subsidiary companies, as the case may be, effective the Completion
Date. On Completion Date, Purchaser shall, to the extent necessary,
confirm the "Settlement Agreement" to be concluded between Vendor, the
Company and its subsidiary companies on the one hand and Mr. Hinnen,
B.V. Wisteria and/or Pantapharma on the other hand. On Completion
Date Mr. H. Olthof shall be appointed as statutory director of the
Company.
8.3. Vendor has made available to Purchaser, amongst others, (i) an
information Memorandum regarding Galenica B.V. and Confedera B.V.
prepared by Reitsma & Wertheim Partners (attached to this Agreement as
Exhibit 4) (ii) a memorandum on the consolidated interim financial
statements of the Company for the period ended 30 September 1997,
prepared by the auditor of the Company, PaardeKooper & Hoffman
accountants (attached to this Agreement as Exhibit 5). To the best of
Vendor's knowledge, the information contained in these memorandums is
accurate and complete.
-6-
<PAGE> 7
The Vendor knows of no information which is or may reasonably be
regarded as material to an accurate appraisal of the affairs of the
Company and which has not been disclosed to the Purchaser.
8.4 Purchaser is aware of a dispute between Pluripham International B.V.
on the one hand, and Singultus B.V. on the other hand, which dispute
has arisen out of an Assets and Liabilities Transfer Agreement dated 4
July 1997. This dispute concerns the entitlement to an amount of
f 1.000.000, -- as presently held in escrow account. It is agreed that
any costs and proceeds in connection with this dispute will be solely
for the account of Vendor. In case any action is required by Purchaser
in this respect, Purchaser undertakes to assist Vendor and/or
Pluripharm International B.V., as the case may be.
8.5 It is agreed that upon completion, the Articles of Association of the
Company will be amended to the effect that (i) a supervisory board
(the "Board") will be installed (with two members, one on behalf of
Vendor (initially being Mr. E.G. Tindell) and one on behalf of
Purchaser (initially being Mr. M. Rijkehoer); (ii) the Board shall be
entitled to receive financial information on the Company and its
subsidiaries on a monthly basis, and an audited financial statement on
an annual basis; and (iii) no material action may be taken without
unanimous approval of the members of the Board (such material actions
shall include, but not be limited to (a) the issuance of any equity
(or securities or instruments convertible or exercisable into equity
securities) of the Company or its subsidiaries; (b) the entering into
any transaction with an affiliate of Vendor or the Company; (c) the
increase in compensation of any executive officer or managing director
of the Company or any of its subsidiaries; (d) the sale or transfer of
all or substantially all of the assets or stock of the Company or any
of its subsidiaries; or (e) the liquidation, dissolution or winding-up
of the Company or any of its subsidiaries or the bankruptcy or
suspension of payment by the Company or any of its subsidiaries.
8.7 It is agreed that Purchaser will be responsible for the day to day
management of the Company and its subsidiary companies, as the case
may be. It is further agreed that Vendor will not interfere in the
normal conduct of business of the Company and its subsidiary
companies, as the case may be.
9 Assignment of Rights
--------------------
9.1. The Purchaser is entitled to assign all its rights under this
Agreement to any of its 100 subsidiaries or to a member of the
Purchasers Group in which Purchaser holds a majority interest or a
natural person related to the Purchaser. In the event of such
assignment by Purchaser, Purchaser shall procure that the assignee
assumes all then outstanding obligations of Purchaser under this
Agreement.
-7-
<PAGE> 8
10. Rescission
----------
10.1 Up to Completion Date, the Purchaser shall, in its sole judgement, be
entitled to rescind ("ontbinden") this Agreement, without intervention
of the Court being required, by notice to the Vendor, solely in the
event the relevant Districts Courts in Utrecht and Breda have not
approved of withdrawing the "surseance van betaling" (suspension of
payment) which was temporarily granted to Confedera B.V. and
Galenica B.V. on 19 November 1997. Purchaser shall not be entitled to
rescind this Agreement on any other ground or for any other reason.
11. Costs
-----
11.1. Each party to this Agreement will bear its own costs in relation to
the negotiating and preparing of this Agreement. The costs of the
Notarial Deed of Transfer will be for 50% for the account of each
party to this Agreement.
12. Governing Law, Disputes
-----------------------
12.1. This Agreement shall be governed by the laws of the Netherlands.
12.2. All disputes arising in connection with this Agreement shall he
submitted to the competent Court in Amsterdam, the Netherlands.
13. Announcements
-------------
13.1. No announcements with respect to this Agreement shall be made unless
agreed by parties or required by law.
13.2. The vendor undertakes to the Purchaser that it will not at any time
from the date hereof divulge or communicate to any person other than
to officers or employees of the Company whose province it is to know
the same or on the instructions of the Board of Directors of the
Company any confidential information concerning any aspect of the
Company and it shall use its best endeavors to prevent the publication
or disclosure of any such confidential information concerning such
matters.
This Agreement represents the entire understanding and agreement between the
Vendor and the Purchaser with respect to the purchase and sale of the Shares and
supercedes all previous agreements, both in writing and oral, including
correspondence.
-8-
<PAGE> 9
IN WITNESS WHEREOF the parties hereto have executed this Agreement in Amsterdam,
the Netherlands, on 26 November 1997 by their duly authorized representatives.
/S/ E. Gene Tindell /S/ M. Rijkeboer
- --------------------------- --------------------------
EuroMed, Inc. Neopharm B.V.
-9-
<PAGE> 10
ADDENDUM
--------
THE UNDERSIGNED:
1. NEOPHARM B.V., a private company with limited liability with seat at
Groningen, duly represented by Mr. M. Rijkeboer, hereinafter referred to as
"the Purchaser";
AND
2. EUROMED, INC., a public company incorporated under the laws of Nevada,
United States of America, duly represented by its CEO, Mr. E.G. Tindell,
hereinafter referred to as "the Vendor";
This letter is executed in addition to the Purchase Agreement entered into
between Vendor and Purchaser dated 26 November 1997 regarding the purchase of
80% of the issued and outstanding shares in EuroMed Europe B.V. ("the
Agreement"). Words in this Letter of Additional Understanding shall have the
same meaning as provided in the Agreement.
1. It is agreed that upon Completion, Vendor undertakes to increase the equity
of the Company by way of converting a loan made available by Vendor to the
Company to the amount of Dfl 5.500.00 (five million five hundred thousand)
into share capital of the Company. To the extent necessary, the Articles of
Association of the Company will be amended accordingly. All costs in
connection with the envisaged increase of capital will be for the account
of Vendor. Equity in the Company will be issued to Vendor and Purchaser in
such a way that upon completion of the increase of share capital as
mentioned in this clause, Purchaser will hold 80% of the issued and
outstanding share capital in the Company.
2. It is agreed that Vendor will indemnify, defend and hold Purchaser, and its
employees, agents, attorneys and affiliates harmless from and against any
and all losses, claims, cause of action, obligations, demands assessments,
penalties, liabilities, costs, damages, attorneys' fees and expenses,
asserted against or incurred by third parties (such as, but not limited to
shareholders and creditors of EuroMed, Inc.) By reason of or resulting (i)
from any claims made or initiated by Mr. A. Gaylor against Vendor and/or
its subsidiary and/or affiliate companies and/or its employees, or agents
and (ii) from any claims made or initiated by Mr. A. Gaylor against
Purchaser and/or its subsidiary and/or affiliate companies, and/or its
employees or agents.
3. It is agreed that Purchaser will pay one-third (1/3) of the purchase price
as mentioned in the Agreement under clause 2, on Monday 8 December 1997 and
the balance (2/3) on Completion Date on condition that ultimately on 8
December 1997 (i) Vendor has furnished to Purchaser written evidence of
board approval of the Board of Directors of EuroMed, Inc. unconditionally
approving and/or ratifying (a) the Agreement as signed on 26 November 1997
including this Addendum and (b) the Settlement Agreement signed on 27
November 1997 between the EuroMed Group and Mr. Hinnen, Pantapharma and
Wisteria; and (ii) the suspensions of
-10-
<PAGE> 11
payment of Galencia B.V. and Confedera B.V. have been withdrawn by the
relevant District Courts.
Signed at Amsterdam, the Netherlands on December 3, 1997, by:
/S/ E. Gene Tindell /S/ M. Rijkeboer
- --------------------------- ---------------------------
Neopharm B.V. EuroMed, Inc.
-11-
<PAGE> 1
EXHIBIT 2.2
SETTLEMENT AGREEMENT
1a. The company EUROMED. INC., incorporated under the laws of Nevada,
United States of America, duly represented by one of its board
members, E.G. Tindell, hereinafter to be referred as: "EuroMed,
Inc.";
1b. The private limited liability company EUROMED EUROPE B.V.,
incorporated under the laws of The Netherlands, duly represented by
one of its statutory directors, EuroMed, Inc., hereinafter to be
referred as: "EuroMed B.V.";
1c. The private limited liability company MUTARESTES B.V., incorporated
under the laws of The Netherlands, duly represented by its statutory
director, B.V. Wisteria, duly represented by its statutory director
Pantapharma B.V., hereinafter to be referred as: "Mutarestes";
1d. The private limited liability company GALENICA B.V., incorporated
under the laws of The Netherlands, duly represented by its statutory
director EuroMed Europe B.V., hereinafter to be referred as:
"Galenica";
1e. The private limited liability company CONFEDERA B.V., incorporated
under the laws of The Netherlands, duly represented by its statutory
director, EuroMed Europe B.V., hereinafter to be referred as:
"Confedera";
1f. The private limited liability company PLURIPHARM INTERNATIONAL B.V.,
incorporated under the laws of The Netherlands, duly represented by
its statutory director Wisteria, hereinafter to be referred as:
"Pluripharm";
AND
2a. The private limited liability company PANTAPHARMA B.V., incorporated
under the laws of The Netherlands, duly represented by its statutory
director, A.F. Hinnen, hereinafter to be referred as: "Pantapharma";
2b. The private limited liability company B.V. WISTERIA, incorporated
under the laws of The Netherlands, duly represented by its statutory
director Pantapharma, hereinafter to be referred as: "Wisteria";
2c. ADRIAAN FRANCOIS HINNEN, residing at Velp (Gld), The Netherlands,
Beekhuizenseweg 87 (6881 AG), hereinafter to be referred as:
"Hinnen";
Parties la. up to and including lf. will be collectively referred to as: "the
EuroMed-group";
Page 1
<PAGE> 2
WHEREAS:
a. EuroMed, Inc., owns all of the issued and outstanding shares of
EuroMed B.V.;
b. EuroMed B.V. holds all of the issued and outstanding shares in the
capital of Mutarestes, which in turn owns all of the issued and
outstanding shares of Pluripharm;
c. EuroMed B.V. holds also all of the issued and outstanding shares in
the capital of Galenica and Confedera;
d. Pantapharma is the statutory director of Wisteria, which latter
company is a major shareholder in EuroMed, Inc. and holds 1,850,000
shares (of which 1,000,000 are legally owned by Wisteria);
e. Hinnen, Wisteria and Pantapharma have entered into three management
agreements with the EuroMed-group which were signed on October 12,
1995 (2x) and July 5, 1996 (lx), (hereinafter: "the Management
Agreements"), whereby Wisteria was appointed as manager for EuroMed
B.V., Mutarestes, Pluripharm and Galenica and whereby Pantapharma was
appointed as manager for Confedera. In addition, Hinnen was appointed
as board member of EuroMed, Inc. in July 1996;
f. The Parties have made certain claims against each other and have
agreed to settle their differences on the terms contained in the
agreement (hereinafter: "the Agreement");
THE PARTIES HEREBY AGREE AS FOLLOWS:
ARTICLE 1 RETURN OF THE 1,850,000 EUROMED, INC. SHARES
1.1 Subject to the terms and conditions contained herein Wisteria agrees
to return for the benefit of EuroMed, Inc. the 1,850,000 EuroMed,
Inc. Shares to EuroMed, Inc. and EuroMed, Inc. accepts the 1,850,000
EuroMed, Inc. Shares from Wisteria. Wisteria agrees to return the
1,850,000 EuroMed, Inc. Shares to EuroMed, Inc. in consideration of
receiving full and final release from the EuroMed-group as defined in
Article 3 hereof.
1.2 The return of the 1,850,000 EuroMed, Inc. Shares will be effected by
handing over the original certificate by Wisteria to Mr. N.B.L.
Taaselaar, civil law notary, until (i) the joint declaration as
mentioned in Article 5.2 hereof has been furnished, (ii) the
resolutions mentioned in Article 6.4 hereof have been furnished and
(iii) all conditions mentioned in Article 7 hereof have beef
fulfilled.
Page 2
<PAGE> 3
ARTICLE 2 REPRESENTATIONS AND WARRANTIES
2.1 Each member of the EuroMed-group represents and warrants that EuroMed,
Inc. has full corporate power and authority to execute and perform the
Agreement and the transactions contemplated thereby in accordance with
their terms.
2.2 At or prior to the signing of the Agreement, each member of the
EuroMed-group represents and warrants that the execution and the
performance of the Agreement and the transactions contemplated thereby
have been duly authorized by all necessary corporate actions on the
part of EuroMed, Inc.
2.3 At or prior to the signing of the Agreement, each member of the
EuroMed-group represents and warrants that no consent, authorization,
approval of the United States Securities and Exchange Commission,
Federal Trade Commission or any other law of the United States of
America or any State "Blue Sky Law" is required on behalf of EuroMed,
Inc. in connection with the execution and performance of the Agreement
and the transactions contemplated thereby.
ARTICLE 3 INDEMNIFICATION AND WAIVER OF CLAIMS
3.1 Each member of the EuroMed-group will indemnify, defend and hold
Hinnen, Wisteria, Pantapharma and their employees, agents, attorneys
and affiliates harmless from and against any and all losses, claims,
causes of action, obligations, demands, assessments, penalties,
liabilities, costs, damages, attorneys' fees and expenses, asserted
against or incurred by third parties (such as, but not limited to
shareholders and creditors of EuroMed, Inc.) by reason of or resulting
from: (a) any claim arising from this Agreement and/or any other
agreement executed in connection with this transaction contemplated
hereby and/or (b) any claim arising from the Share Purchase Agreement
(regarding the shares of Mutarestes B.V.) dated July 5, 1996 and the
Asset and Liabilities Transfer Agreement (regarding the assets of
Mutarestes B.V.) dated March 3, 1997, the Management Agreements and/or
the activities and duties performed by Hinnen, Wisteria and/or
Pantapharma, except for claims (i) arising from the unlawful action or
omission for which Hinnen, Wisteria and/or Pantapharma may be blamed
personally ("verwijtbaar onrechtmatig handelen of nalaten").
3.2 Each member of the EuroMed-group hereby fully releases Hinnen,
Wisteria, Pantapharma and their employees, agents, officers,
directors, attorneys and affiliates and waives its rights to claim
inter alia damages and on the same basis Hinnen, Wisteria and
Pantapharma hereby fully release each member of the EuroMed-group and
their employees, agents, officers, directors, attorneys and affiliates
and waives their right to claim inter alia damages with respect to any
claim, such as, but not limited to any claim (i) resulting from this
Agreement or (ii) resulting from the Management Agreements and/or the
activities and duties performed by Hinnen, Wisteria and/or Pantapharma
or (iii) resulting from any event in connection with the financial
position of the EuroMed- group, the delisting of the Nasdaq or any
other event which
Page 3
<PAGE> 4
occurred as of July 5, 1996 or (iv) resulting from any event, act or
omission by Hinnen, Wisteria and Pantapharma with respect to the
EuroMed-group and in their possible capacity as member of the Board of
Directors of EuroMed, Inc., EuroMed B.V., Confedera, Galenica,
Mutarestes and/or Pluripharm.
3.3 Each member of the EuroMed-group represents and warrants that it has
not assigned or transferred any of the claims mentioned in Article 3
hereof to any third party.
On the same basis Hinnen, Wisteria and Pantapharma represent and
warrant that they have not assigned or transferred any of the claims
mentioned in Article 3 hereof to any third party.
3.4 It is explicitly understood that the settlement of disputes and the
releases as mentioned in this article is considered to be a settlement
agreement as meant by Article 7:900 of the Dutch Civil Code as of the
date the certificates are handed over to EuroMed, Inc. as provided in
Article 1.2.
ARTICLE 4 TREATMENT OF CLAIMS
4.1 In case Hinnen and/or Wisteria and/or Pantapharma will be sued by a
third party concerning an event for which the indemnification of
Article 3 applies, EuroMed, Inc. will deal diligently with this claim
on behalf of the abovementioned persons and legal entities as "dominus
litis."
4.2 EuroMed, Inc. will inform Hinnen, Wisteria and Pantapharma fully and
quickly about the pending claim and will furnish copies of all
documents concerning the claim to Hinnen, Wisteria and/or Pantapharma.
4.3 The costs for and arising from any legal proceeding or settlement with
respect to such claim will be for the account of EuroMed, Inc.
4.4 Hinnen and Wisteria may appoint a counsel who may interfere with the
legal proceedings and/or negotiations on their behalf and on behalf of
Hinnen, Wisteria and/or Pantapharma. The costs for this counsel will
be for the account of Hinnen and Wisteria.
4.5 Hinnen and Wisteria will not give any support (unless required by law)
to third parties who have the intention to file a claim against the
EuroMed-group with respect to the agreements and actions mentioned in
Article 3.1 under a and b. The EuroMed-group will not give any
support (unless required by law) to third parties who have the
intention to file a claim against Hinnen, Wisteria and/or Pantapharma
with respect to the agreements and actions mentioned in Article 3.1
under a and b.
Page 4
<PAGE> 5
ARTICLE 5 CONFIDENTIALITY
5.1 Each party shall keep the terms of the Agreement confidential, and
shall make no press release or public disclosures, either written or
oral, regarding the transactions contemplated by the Agreement without
the prior knowledge and consent of the other parties hereto; provided
that the foregoing shall not prohibit any disclosure (i) by press
release or filing that is required by law (such as United States
securities laws), copies of which shall be made available to Hinnen,
Wisteria and Pantapharma, (ii) to advisors, financiers or lenders of
any party and (iii) to the Shareholders meeting of EuroMed, Inc.
5.2 Parties will jointly agree on a text for a press release and on filing
with the SEC, announcing the resignation of Hinnen and Wisteria as
directors of the EuroMed-group as agreed in this Settlement Agreement
and the sale of (part of) the companies of the EuroMed-group to
Rijkeboer/Neopharm. No interviews or other press releases will be
made by any of the parties. This joint declaration will be the only
publication (verbal or written) made by the parties regarding this
transaction. This joint declaration will be deposited with the civil
law notary mentioned in Article 1.2 hereof and be released when all
the conditions mentioned in Article 1.2 have been fulfilled.
ARTICLE 6 MANAGEMENT AGREEMENTS AND RELEASE
6.1 EuroMed B.V. confirms hereby the resignation of Hinnen, Wisteria and
Pantapharma as managers in accordance with the Management Agreements
as of the date that the original certificate mentioned in Article 1.2
is handed over by Wisteria to the civil law notary and all conditions
mentioned all conditions mentioned in Article 1.2 have been fulfilled.
6.2 EuroMed, Inc. confirms hereby the resignation of Hinnen as member of
the Board of Directors of EuroMed, Inc. as per the date that the
original certificate mentioned in Article 1.2 is handed over by
Wisteria to the civil law notary and all conditions mentioned in
Article 1.2 have been fulfilled.
6.3 The EuroMed-group as of the date of termination of the Management
Agreements and the date of resignation of Hinnen as member of the
Board of Directors of EuroMed, Inc., acknowledges that Hinnen,
Wisteria and Pantapharma will be released from any liabilities and
will be fully discharged with respect to their position as managers.
It is agreed that the non-competition clauses of the Management
Agreements cannot be enforced against Hinnen, Wisteria and
Pantapharma. However, Hinnen, Wisteria and Pantapharma agree that
they are not allowed, directly or indirectly, to be active in the
field of wholesale of pharmaceutical products in the Netherlands for a
period of two years upon signing this agreement.
Page 5
<PAGE> 6
6.4 Each respective company in the EuroMed-group will pass on the date
mentioned in Article 6.1 hereof a shareholders resolution in which the
relevant company and/or Pantapharma (i) confirms the resignation of
Hinnen and/or Wisteria as board member and/or statutory directors as
per the date mentioned in Article 6.1 hereof and (ii) provides a
general release of Hinnen, Wisteria and/or Pantapharma from any and
all liabilities and fully discharges them with respect to their
position as board member and/or statutory directors.
6.5 Each respective company in the EuroMed-group further declares that the
relevant company will release Hinnen, Wisteria and/or Pantapharma,
from any and all liabilities and fully discharges them with respect to
any amounts due (in current account, in connection with the Management
Agreements, or otherwise) by Hinnen, Wisteria and/or Pantapharma (or
Cofa Beheer B.V. or Hybrida B.V. as the case may be) to such company.
6.6 Hinnen, Wisteria and Pantapharma declare to release each respective
company in the EuroMed-group from any and all liabilities and fully
discharges them with respect to any amounts due (in current account or
in connection with the Management Agreements, or otherwise) by the
relevant company to Hinnen, Wisteria and/or Pantapharma.
ARTICLE 7 FURTHER COVENANTS
7.1 EuroMed Europe B.V. shall transfer legal title of 51% of the shares it
presently owns in the share capital of Confedera Philippines Inc. to
Hinnen or to a legal entity in accordance with his instructions. In
order to implement this transfer of shares, EuroMed Europe B.V. hereby
transfers - to the extent possible under the laws of the Philippines -
said shares to Hinnen, who accepts, to the extent possible under the
laws of the Philippines, this transfer. EuroMed Europe B.V. herewith
grants full power of attorney to Hinnen in order to sign every
document and to perform any and all acts that may be necessary or
useful in order to effectuate the transfer of legal title of the
Confedera Philippines Inc. to Hinnen according to the applicable laws
of the Philippines.
7.2 Confedera B.V. shall transfer ownership of the car presently used by
Hinnen (audi 100, with number LH-JF-72) to Hinnen or to a legal entity
in accordance with his instructions.
7.3 EuroMed, Inc. will furnish evidence of board approval of EuroMed, Inc.
to enter into this Settlement Agreement, in the form of a signed copy
of the minutes of the relevant board meeting. EuroMed, Inc. will
furnish this evidence of board approval to the civil law notary
mentioned in Article 1.2 hereof.
7.4 Confedera B.V. shall transfer ownership of the personal computer
presently used by Hinnen to Hinnen or to a legal entity in accordance
with his instructions.
Page 6
<PAGE> 7
7.5 Hinnen, Wisteria and Panthapharma shall return all documents, keys,
assets, and or other items owed by or belonging to EuroMed-group to
the relevant company of the EuroMed-group.
ARTICLE 8 CHOICE OF LAWS
8.1 The Agreement and the rights and obligations of the parties hereto are
governed by and construed and enforced in accordance with the laws of
The Netherlands. Any dispute arising under the Agreement shall be
exclusively settled by the competent Court of Amsterdam, The
Netherlands.
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of
today 27 November 1997.
/S/ E. Gene Tindell /S/ E. Gene Tindell
- ------------------------------------- --------------------------------------
EuroMed, Inc. EuroMed Europe B.V.
/S/ E. Gene Tindell, /S/ A. F. Hinnen /S/ E. Gene Tindell
- ------------------------------------- --------------------------------------
Mutarestes B.V. Galenica B.V.
/S/ E. Gene Tindell /S/ A. F. Hinnen
- ------------------------------------- --------------------------------------
Confedera B.V. A. F. Hinnen
/S/ A. F. Hinnen /S/ A. F. Hinnen
- ------------------------------------- --------------------------------------
Pantapharma B.V. B. V. Wisteria
/S/ E. Gene Tindell
- -------------------------------------
Pluripharm International B.V.
Page 7
