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
MARCH 20, 1998
(Date of earliest event reported)
NAPRO BIOTHERAPEUTICS, INC.
(Exact name of registrant as specified in its charter)
Commission file number: 0-243201
Delaware 84-1187753
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
6304 Spine Road, Unit A
Boulder, CO 80301
(Address of principal executive offices)
(303) 530-3891
(Registrant's telephone number, including area code)
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Item 5. Other Events.
On March 23, 1998, the Company issued a press release announcing a
Termination Agreement dated March 20, 1998 (the "Termination Agreement") among
the Company, IVAX Corporation, a Florida corporation ("IVAX"), Baker Norton
Pharmaceuticals, Inc., a Florida corporation ("BNP") and D&N Holding
Corporation, a Delaware corporation ("D&N") which terminates certain agreements
and licences certain technology.
The Termination Agreement and certain other agreements have been filed
as exhibits to this report and are incorporated herein by reference by this
reference.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
The following exhibits are filed herewith:
99.1 Termination Agreement dated March 20, 1998 among the Company, IVAX,
BNP and D&N.1
99.2 Escrow Agreement dated as of March 24, 1998 by and between the
Company, BNP and U.S. Bank National Association d/b/a Colorado
National Bank.
99.3. Letter Agreement, dated March 20, 1998, by and between the Company,
Leonard P. Shaykin and D&N
99.4 NaPro Release dated as of March 20, 1998.
99.5 IVAX, BNP and D&N Release dated as of March 20, 1998.
99.6 Press Release dated March 23, 1998 regarding Termination Agreement and
other agreements.
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1 A portion of the text of this agreement has been
redacted from this agreement and filed separately with the
Commission pursuant to a Confidential Treatment Request.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Napro Biotherapeutics, Inc.
/s/Gordon H. Link, Jr.
Date: March 26, 1998 Gordon H. Link, Jr.
Chief Financial Officer
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Exhibit 99.1
TERMINATION AGREEMENT
This Termination Agreement, dated March 20, 1998 (the "Effective
Date"), is entered into among NaPro BioTherapeutics, Inc., a Delaware
corporation ("NaPro"), IVAX Corporation, a Florida corporation ("IVAX"), Baker
Norton Pharmaceuticals, Inc., a Florida corporation ("BNP"), and D&N Holding
Company, a Delaware corporation ("D&N"). NaPro shall be referred to herein as a
"party" to this Agreement and IVAX, BNP and D&N shall collectively be referred
to herein as a "party" to this Agreement.
Recitals
IVAX is the parent company of BNP and D&N. NaPro and BNP are parties to
an agreement, dated June 7, 1993, as amended April 12, 1994 and January 25,
1996, relating to the manufacture, marketing and distribution of paclitaxel (the
"Prior Agreement"), and NaPro and D&N are parties to a Subscription Agreement
dated as of June 7, 1993, a Stockholders Agreement dated as of June 7, 1993, a
Registration Agreement dated as of June 7, 1993, a Subscription Agreement dated
as of April 12, 1994, and a Registration Rights Agreement dated as of April 12,
1994 (collectively, the "Related Agreements"). NaPro and BNP desire to terminate
the Prior Agreement and their respective rights and obligations under such
agreement on the terms and conditions of this Agreement, and NaPro and D&N
desire to terminate the Related Agreements and their respective rights and
obligations under such agreements on the terms and conditions of this Agreement
so that this Agreement comprises the entire agreement between the parties.
Agreement
In consideration of the Recitals and the mutual promises set forth in
this Agreement, NaPro, IVAX, BNP and D&N agree as set forth below.
1. Definitions. In this Agreement, the following terms when used with
initial capital letters shall have the meanings set forth below:
(a) "Affiliate" shall mean with respect to a Person, any other
Person controlling, controlled by or under common control with such Person. For
the purposes of this definition, "control" (including, with the correlative
meanings, "controlling", "controlled by" and "under common control with"), with
respect to any Person means the direct or indirect ownership of more than fifty
percent (50%) of the outstanding voting or equity interest in such Person.
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(b) "BNP Formulation" shall mean the formulation of paclitaxel injection
presently described in *[TEXT REDACTED]1
(c) "BNP Territory" shall mean the United States, Canada, Europe (including
the European Union, Eastern Europe and CIS), Argentina, Chile, Uruguay, Brazil,
China and Taiwan.
(d) "CIS" shall mean the Commonwealth of Independent States, or any
successor state or states.
(e) "Confidential Information" shall have the meaning set forth in Section
7(a) of this Agreement.
(f) "Dollars or $" shall mean U.S. Dollars.
(g) "Exclusive Faulding Territory" shall mean Australia, New Zealand,
Singapore, Malaysia, Thailand, the Philippines, Indonesia, India, Hong Kong and
South Korea.
(h) "Ex works" shall mean such delivery term as defined in the current
edition of the International Chamber of Commerce publication "Incoterms".
(i) "Faulding" shall mean F.H. Faulding & Co., Limited.
(j) "FDA" shall mean the United States Food and Drug Administration or any
successor body.
(k) "GMP" shall mean good manufacturing practice as required by FDA
regulations.
(l) "IND" shall mean the application with the regulatory authority required
in a particular country in relation to a product in order that such product may
be used for investigational clinical use with human subjects notwithstanding
that the local name for such an application may be different.
(m) "Loss" shall mean all loss, damage, cost and expense, including
reasonable attorneys' fees, but shall exclude claims for lost profits and other
consequential losses. -------- 1The portion of this agreement marked "*[TEXT
REDACTED]" indicates that the portion that has been omitted from this agreement
and filed separately with the Commission pursuant to a Confidential Treatment
Request.
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(n) "NaPro Patent" shall mean NaPro's U.S. patent application
entitled *[TEXT REDACTED]1 and any and all divisional applications or
continuations of such patent application and any patents issued thereupon and
the equivalent thereof in all countries of the BNP Territory.
(o) "Paclitaxel" shall mean the chemical entity of the formula set forth in
Exhibit G attached hereto.
(p) "Person" shall mean any company, corporation, partnership, trust, or
any other legal entity.
(q) "Product" shall mean Paclitaxel which meets the Specification.
(r) "Registration" shall mean the registration with the
regulatory authority required in a particular country in relation to a product
in order that such product can be marketed for human use to the general public
in that country.
(s) "Reserved Patents" shall mean all of the patents and
patent applications which NaPro owns or controls as of the Effective Date (other
than the NaPro Patent) relating to the manufacture, finishing or pharmaceutical
uses of Paclitaxel, and any substitute, continuation, continuation-in-part,
division, reissue, renewal, extension or addition thereof, and any foreign
applications corresponding to any of such patents and patent applications and
any patents which issue in any country based on any of said patent applications.
(t) "Specification" shall mean the specification for the Product set forth
on Exhibit F.
(u) "Third Party" shall mean a Person other than BNP, NaPro, or any
Affiliate of BNP or NaPro.
2. Termination of Prior Agreement and Related Agreements. As of the
Effective Date, the Prior Agreement and the Related Agreements are terminated in
all respects and of no further force or effect and, notwithstanding anything in
the Prior Agreement or the Related Agreements to the contrary (including but not
limited to Section 6.3 of the Prior Agreement), no party shall have any further
rights or obligations under such agreements.
- --------
1The portion of this agreement marked "*[TEXT REDACTED]" indicates that
the portion that has been omitted from this agreement and filed separately with
the Commission pursuant to a Confidential Treatment Request.
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3. Release. On the Effective Date, NaPro agrees to execute and deliver
to IVAX, BNP and D&N the form of release attached hereto as Exhibit A-1 and
IVAX, BNP and D&N each agree to execute and deliver to NaPro the form of release
attached hereto as Exhibit A-2.
4. Patent License.
(a) Grant of License. Subject to Sections 4(b), 4(c) and
11(i), NaPro hereby grants to BNP a non-exclusive, royalty-free license under
the NaPro Patent to manufacture, use, sell, offer for sale and import paclitaxel
injection in the BNP Territory, until the expiration of the NaPro Patent in each
country of the BNP Territory (the "License").
(b) Consideration for License. In consideration of the License and the
other rights granted to BNP pursuant to the terms of this Agreement:
(i) Within two (2) business days after the Effective Date, BNP shall make a
payment to NaPro equal to six million seventy thousand dollars ($6,070,000) by
wire transfer of immediately available funds to an account designated by NaPro;
provided, however, that two million dollars ($2,000,000) of such amount shall be
placed in escrow (the "Escrow Payment") and transferred to NaPro in accordance
with the provisions of Section 6(b)(iv) hereof;
(ii) Within five (5) business days after NaPro files its 1997 annual report
on Form 10-K and delivers a copy of such report to BNP, BNP shall transfer to
NaPro one million one hundred twenty six thousand three hundred ninety eight
(1,126,398) shares of NaPro common stock ("Common Stock"),which transfer shall
be effected by the delivery to NaPro of the stock certificate or certificates
representing such shares together with appropriately executed stock powers;
(iii) Subject to clause (v) below, within two (2) business days after NaPro
notifies BNP of the issuance of the NaPro Patent in the United States, which
notice shall include proof of issuance, BNP shall make a payment to NaPro equal
to three million seven hundred fifty thousand dollars ($3,750,000) by wire
transfer of immediately available funds to an account designated by NaPro; and
(iv) Subject to clause (v) below, within two (2) business days after NaPro
notifies BNP of the grant of the NaPro Patent in the European Patent Office,
which notice shall include proof of grant, BNP shall make a payment to NaPro
equal to two million six hundred ten thousand dollars ($2,610,000) by wire
transfer of immediately available funds to an account designated by NaPro.
(v) BNP's obligation to make the payments set forth in 4(b)(iii) and
4(b)(iv) shall be subject to the following conditions: (1) the License is then
in full force and
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effect and (2) the BNP Formulation would infringe the claims of the issued
patent, provided, however, that if BNP believes that the BNP Formulation does
not infringe upon the claims of the issued patent and elects not to pay the fee
as set forth in (iii) or (iv) above, then the License shall no longer include
such patent.
(c) No Assignment or Transfer. The License is personal to BNP
and may not be assigned or transferred or sublicensed in any manner, other than
to an Affiliate of BNP that has agreed in writing to be bound by the terms and
conditions of this Agreement, without the prior written consent of NaPro;
provided that this clause shall in no way restrict the ability of BNP to (1)
appoint marketing partners or distributors for paclitaxel injection or (2)
subcontract with Third Parties to manufacture paclitaxel injection for BNP or
BNP's marketing partners and distributors. Notwithstanding the foregoing, in the
event that (i) BNP or any Affiliate of BNP shall appoint any of the companies
listed on Exhibit E attached hereto as a marketing partner or distributor of
paclitaxel injection, or (ii) BNP shall become an Affiliate of any of the
companies listed on Exhibit E attached hereto, then NaPro shall have the right
to terminate the License upon written notice to BNP, and upon such termination
by NaPro the License shall be of no further force or effect; provided that BNP
may enter into any other type of arrangement with such companies, including
without limitation, arrangements for the supply of Paclitaxel or arrangements
for the contract manufacture of paclitaxel injection.
(d) Prosecution of NaPro Patent. NaPro shall, through counsel
of its own choosing and at its own expense, take all reasonable steps to file,
prosecute and maintain the NaPro Patent in all countries within the BNP
Territory where such patent is pending, whether by means of patent cooperation
treaties or otherwise. NaPro agrees to promptly provide BNP's patent counsel, in
such period of time as shall accord BNP and its patent counsel a reasonable
period of time for review and comment to the extent possible, given filing
deadlines, with a copy of all filings related to the NaPro Patent in such
countries prior to the time any such filings are made. To the extent possible
given filing deadlines, BNP and its patent counsel shall be provided with an
opportunity to comment on all such filings and NaPro shall consider all
reasonable comments made by BNP and its patent counsel received in time for such
comments to be incorporated into such filings. In addition to the foregoing,
NaPro agrees to promptly provide BNP's patent counsel with copies of all papers,
specifications, amendments, replies, official actions and other documents and
correspondence with the patent offices of such countries relating to the filing,
prosecution and maintenance of the NaPro Patent, including, without limitation,
copies of each patent application filed in the patent offices of such countries
and each patent that issues thereon with respect to the NaPro Patent. Neither
BNP nor any of its Affiliates shall have the right to enforce the NaPro Patent.
(e) Reserved Patents. Other than the NaPro Patent, BNP acknowledges and
agrees that nothing in this Agreement grants BNP or any of its Affiliates any
rights under or to
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any patents or patent applications owned now or in the future by NaPro or any of
its Affiliates, including without limitation the Reserved Patents.
5. Outstanding Receivable. BNP shall make a payment to NaPro equal to
one million dollars ($1,000,000) in full satisfaction of all amounts due to
NaPro under the Prior Agreement, including all outstanding unpaid invoices for
Product. Such payment shall be made within two (2) business days after the
Effective Date by wire transfer of immediately available funds to an account
designated by NaPro.
6. Supply of Product.
(a) Cancellation of Purchase Orders and Forecasts. All outstanding purchase
orders for Product and forecasts under the Prior Agreement are canceled in all
respects as of the Effective Date.
(b) Supply of Product.
(i) Delivery of Product. NaPro shall deliver a total of *[TEXT REDACTED]1
of Product to BNP in accordance with the delivery schedule attached hereto as
Exhibit B. NaPro acknowledges that (i) BNP has paid for and is the owner of
*[TEXT REDACTED] of such Product, (ii) that the remaining *[TEXT REDACTED] of
such Product has been processed to a semi-finished state exclusively for BNP,
(iii) that BNP has already paid to NaPro *[TEXT REDACTED] for *[TEXT REDACTED]
of such semi-finished Product and that BNP is the owner of such semi-finished
Product; and (iv) that BNP has already paid to NaPro *[TEXT REDACTED] for *[TEXT
REDACTED] of such semi-finished Product, which price includes the price for
converting such semi-finished Product to finished Product, and that BNP is the
owner of such Product. Pending delivery of such Product to BNP, NaPro agrees to
maintain such Product segregated from its other inventory and to identify such
Product as owned by BNP, in a manner reasonably acceptable to BNP. Upon
reasonable notice to NaPro, BNP shall have the right to inspect such Product
during normal business hours to ensure NaPro's compliance with this paragraph.
For purposes of notifying NaPro's creditors of BNP's ownership of such Product,
on the Effective Date NaPro will execute and deliver to BNP a UCC-1 financing
statement in a form reasonably acceptable to BNP. NaPro shall also take such
further actions and execute such further documents as BNP may reasonably request
to secure BNP's interest in such Product.
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1The portion of this agreement marked "*[TEXT REDACTED]" indicates that
the portion that has been omitted from this agreement and filed separately with
the Commission pursuant to a Confidential Treatment Request.
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(ii) Force Majeure. NaPro shall not be liable to BNP in the event that
performance of its supply obligations hereunder shall be prevented by events of
force majeure, including without limitation acts of God, acts of government,
accident, fire, delay or destruction of means of transport or other disaster,
but NaPro shall use reasonable efforts to avoid or remove the cause of such
nonperformance and shall continue performance hereunder with the utmost dispatch
whenever such cause is removed.
(iii) Payment for Product. The first *[TEXT REDACTED]1 of Product delivered
by NaPro pursuant to Section 6(b)(i) shall require no additional payment by BNP.
For the remaining *[TEXT REDACTED] of Product to be delivered to BNP pursuant to
Section 6(b)(i), the ex works price to convert such Product from semi-finished
to finished state shall be *[TEXT REDACTED]. NaPro shall invoice such Product
upon delivery ex works Boulder (or other NaPro Facility) and payment for the
Product shall be due thirty (30) days net. Payments shall be made by wire
transfer to the account specified by NaPro from time to time.
(iv) Release from Escrow. In addition to the payments for Product to be
made by BNP pursuant to Section 6(b)(iii), upon delivery of Product to BNP in
the quantities set forth on Exhibit B, BNP shall release from escrow the amount
of money set forth on such Exhibit B corresponding to such Product quantity. In
the event that NaPro fails to supply Product according to such delivery
schedule, then BNP may issue NaPro a notice of default of this supply
obligation. If (a) ninety (90) days following such notice, NaPro remains in
default, or (b) NaPro is unable to supply Product due to a force majeure event
that lasts for a period of six (6) months, BNP may cancel the remainder of
scheduled deliveries. BNP shall be entitled to immediately recover the remaining
escrow amount, and NaPro shall, within two business days after cancellation of
the remaining delivery schedule, pay to BNP any Loss not covered by the
remaining escrow amount. The maximum Loss which NaPro shall be responsible for
in connection with failure to supply Product as set forth in Exhibit B shall be
*[TEXT REDACTED] not delivered.
(v) Manufacture of Product. NaPro shall manufacture or have manufactured
Product according to the Specification and in accordance with all applicable
United States laws and regulations, including GMP regulations as applicable.
NaPro warrants and guarantees that the Product shall meet the Specification.
With each lot of Product supplied by NaPro to BNP, whether manufactured by NaPro
or otherwise, NaPro shall submit to BNP an appropriate certificate of analysis
confirming compliance with the Specification.
- --------
1The portion of this agreement marked "*[TEXT REDACTED]" indicates that
the portion that has been omitted from this agreement and filed separately with
the Commission pursuant to a Confidential Treatment Request.
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(vi) Inspections. NaPro shall, upon reasonable notice and at
reasonable times, but not more often than once a year (except if a deficiency or
defect or other similar problem is detected, in which event reinspections may be
conducted as often as reasonably necessary to ascertain that such deficiency or
defect or other such problem has been cured), afford BNP's Quality Assurance and
Quality Compliance representatives (which are not manufacturing or production
personnel) (hereinafter referred to "Q&A Representatives") access to NaPro's
premises where the Product manufactured for BNP is being tested and manufactured
and make available books, records and documents as reasonably required to
ascertain that the Product is being manufactured in accordance with the
Specification and all applicable United States laws and regulations, including
without limitation, GMP regulations. During such inspections, NaPro shall permit
BNP's Q&A Representatives to contact and question the quality assurance and
quality compliance personnel of NaPro for the sole purpose set forth in the
preceding sentence. NaPro shall promptly notify BNP of any inspections by any
health regulatory authorities of the premises where the Product is being
manufactured and shall promptly provide BNP with copies of all correspondence,
reports, notices, findings and other material pertinent to such inspections or
otherwise relating to the production of Paclitaxel, as they are received or
produced by or on behalf of NaPro from or to the FDA or any other federal, state
or foreign governmental or regulatory authority. Without limiting the generality
of the foregoing, NaPro shall promptly provide BNP with copies of all regulatory
letters, warning letters, and letters of adverse findings received by NaPro or
any of its agents relating to the production, use or sale of Paclitaxel supplied
to BNP, including without limitation FDA Form 483. For all materials provided to
BNP pursuant to this Section 6(b)(vi), those portions of materials that contain
information that discloses NaPro intellectual property or trade secrets
(including, without limitation, information relating to the production and
manufacture of Paclitaxel) shall be redacted and not provided to BNP; provided,
however, that complete full copies of such materials without such redaction
shall be made available for review (but not copying) by BNP's Q&A
Representatives at NaPro's offices.
(vii) Shipping. NaPro shall deliver the Product Ex works NaPro's
manufacturing facility. NaPro shall cooperate with BNP to ship the Product to
BNP or the finisher designated by BNP or to such other location as BNP's
purchase order shall specify, at BNP's expense. Risk of loss to the Product
shall pass upon delivery to BNP's common carrier. BNP shall be responsible for
obtaining any necessary import or export licenses to ship the Product. Following
delivery of the Product to BNP, BNP shall forthwith check a representative
sample of the Product for conformity to the Specification and inform NaPro by
written notice of any damaged or otherwise defective Product supplied by NaPro
hereunder and shall, upon the request of NaPro, return the damaged or defective
Product to NaPro and the reasonable cost of return shall be borne by NaPro and
NaPro shall as soon as practicable replace the damaged or defective Product free
of any additional charges, provided that such damage or defect shall not have
been caused by BNP or the shipper to BNP.
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(viii) Additional Product. At the request of BNP, NaPro shall
manufacture and sell to BNP up to *[TEXT REDACTED]1 of Product containing *[TEXT
REDACTED] to be mutually agreed upon by NaPro and BNP at a price to be mutually
agreed upon between the parties.
(ix) *[TEXT REDACTED]. NaPro shall continue its ongoing *[TEXT
REDACTED] for Product and provide BNP with the results of such study, and BNP
shall maintain the results of such study in confidence pursuant to the
provisions of Section 7 hereof.
(c) Restriction on Sale of Product. Without the prior written
consent of NaPro: (i) BNP shall not sell any product containing Paclitaxel
supplied by NaPro within the Exclusive Faulding Territory, and (ii) during the
time in which NaPro is a supplier of Product to BNP pursuant to this Agreement
or the License is in full force and effect, BNP shall not sell paclitaxel
injection in the Exclusive Faulding Territory.
(d) Right of Reference. BNP and, to the extent necessary, its
marketing partners and distributors, shall have the right to reference NaPro's
Drug Master File in connection with the sale of paclitaxel injection containing
Product supplied by NaPro under the Prior Agreement or this Agreement. This
right shall terminate upon the completion of BNP's sale of paclitaxel injection
containing Product supplied by NaPro. In the United States, Canada, and the
European Union, BNP and its Affiliates shall endeavor to sell paclitaxel
injection containing NaPro Paclitaxel prior to selling Paclitaxel supplied by
other sources. While this right is in effect, NaPro shall maintain its Drug
Master File in the United States, Canada and the European Union. NaPro will
consult with and assist BNP as reasonably requested in interactions with
regulatory authorities within the United States, Canada, and the European Union
in connection with NaPro's Drug Master File and BNP's pending applications for
Registration in such countries. NaPro shall further provide such letters and
documents to such regulatory authorities as are required to respond to the
questions and comments of such regulatory authorities regarding NaPro's Drug
Master File and BNP's pending applications for Registration in such countries as
will enable BNP to make reference to NaPro's Drug Master File in support of
BNP's submissions or filings with said authorities and as will enable BNP to
respond to questions and comments of such regulatory authorities regarding the
portions of such applications which contain information provided by NaPro, to
the extent such documents or information are in the possession of NaPro. BNP
shall pay NaPro's out-of-pocket costs for such assistance. NaPro shall not make
any amendments to its Drug Master File which would require an amendment to any
of BNP's regulatory applications or otherwise require BNP to make any filing
with any regulatory authority until after such amendment has been approved or
such filing
- --------
1The portion of this agreement marked "*[TEXT REDACTED]" indicates that
the portion that has been omitted from this agreement and filed separately with
the Commission pursuant to a Confidential Treatment Request.
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made. BNP shall use its reasonable best efforts to obtain such approvals or make
such filings in a timely manner.
7. Confidential Information.
(a) Confidential Information. NaPro and BNP have disclosed
information to each other pursuant to the Prior Agreement and NaPro may disclose
information to BNP pursuant to this Agreement which the disclosing party
considers to be confidential ("Confidential Information"). Such Confidential
Information shall expressly include *[TEXT REDACTED]1 and any information
provided by any party to the other pursuant to filing an IND or Registration,
including, without limitation, clinical and pre-clinical data, including
information received from Faulding. Confidential Information shall not include
any information which:
(i) Is now, or hereafter becomes, through no act or failure to act on the
part of the receiving party, generally known or available to the public;
(ii) Is known to the receiving party at the original time of disclosure as
evidenced by written documents in the possession of the receiving party;
(iii) Is hereafter furnished to the receiving party by a Third Party, as a
matter of right and without restriction on disclosure;
(iv) Is disclosed by the receiving party with the written approval of the
disclosing party; or
(v) Is independently developed by a party without use of the other
party's Confidential Information, as evidenced by the developing party's writte
records.
(b) Restriction on Disclosure and Use. As of the Effective
Date, except as provided below, neither party shall disclose any Confidential
Information received from the other party to any Third Party or use any
Confidential Information received from the other party for any purpose.
(c) Return of Confidential Information. Within forty-five (45)
days after the Effective Date, NaPro shall (1) deliver to BNP all Confidential
Information received from BNP that is in tangible form, (2) destroy all such
Confidential Information that is in electronic form, and (3) destroy all
documents created by NaPro or its agents which contain or incorporate
- --------
1The portion of this agreement marked "*[TEXT REDACTED]" indicates that
the portion that has been omitted from this agreement and filed separately with
the Commission pursuant to a Confidential Treatment Request.
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such Confidential Information. Within forty-five (45) days after the Effective
Date, BNP shall (A) deliver to NaPro all Confidential Information received from
NaPro that is in tangible form, (B) destroy all such Confidential Information
that is in electronic form, and (C) destroy all documents created by BNP or its
agents which contain or incorporate such Confidential Information, except for
the Confidential Information specified on Exhibit C-1 ("BNP Retained
Information"). Notwithstanding the foregoing, outside counsel for each of NaPro
and BNP may retain one copy of Confidential Information received from the other
party solely for purposes of maintaining a record of the actual Confidential
Information returned pursuant to this Agreement and each party's compliance with
the provisions of this Agreement. Within five (5) business days after a party is
required to return Confidential Information to the other pursuant to this
Agreement, such party shall deliver to the other a certificate of compliance
with its obligations under this Section 7 in the form attached hereto as Exhibit
C-2 in the case of NaPro, and Exhibit C-3 in the case of BNP, and signed by the
persons listed on Exhibits C-2 in the case of NaPro and Exhibit C-3 in the case
of BNP.
(d) Right to Use and Retain Certain Information.
(i) NaPro shall have no right to retain or use Confidential Information
of BNP.
(ii) BNP shall have the right to use BNP Retained Information, but
only for purposes of formulation, obtaining Registrations within the BNP
Territory, and manufacturing finished paclitaxel injection (but not bulk
Paclitaxel). BNP shall under no circumstances use any Confidential Information,
including any Retained Information, for the purposes of manufacturing or having
manufactured bulk Paclitaxel. BNP shall have the right to use Confidential
Information of Faulding provided to it pursuant to the Prior Agreement solely
within the BNP Territory and solely for the purposes of obtaining Registrations
within the BNP Territory.
(iii) Faulding shall have the right to use Confidential Information of
BNP consisting solely of pre-clinical and clinical data relating to Paclitaxel,
the Product and the BNP Formulation developed under applications for
Registrations or INDs which was provided to Faulding in accordance with the
Prior Agreement prior to the Effective Date, if any, solely within the Exclusive
Faulding Territory and solely for the purposes of obtaining Registrations within
the Exclusive Faulding Territory. Faulding shall not be permitted to disclose
any such information to NaPro or any Third Party except to (i) governmental
regulatory authorities in connection with any applications for an IND or
Registration for paclitaxel injection and any applications for import or export
license with respect to the Product or paclitaxel injection in the Exclusive
Faulding Territory and (ii) clinicians or others in connection with the filing
of such applications. Faulding shall take precautions consistent with those
described in Section 7(f) of this Agreement
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with respect to such information. NaPro shall use commercially reasonable
efforts to cause Faulding to comply with this Section 7(d)(iii).
(e) Restricted Disclosure. BNP will restrict dissemination of
BNP Retained Information to only those employees of BNP with a need to know such
information for the purposes of fulfilling BNP's obligations or exercising its
rights pursuant to this Agreement. No BNP Retained Information shall be
disclosed in any manner to any Third Party, including prospective suppliers,
distributors, marketers or other Persons, except that such information may be
provided to (i) governmental regulatory authorities in connection with any
applications for an IND or Registration for paclitaxel injection and any
applications for import or export license with respect to the Product or
paclitaxel injection in the BNP Territory; (ii) clinicians or others in
connection with the filing of such applications; (iii) a Third Party finisher of
Product as may be necessary for such Third Party to finish the Product; (iv)
pharmaceutical companies with which BNP has entered into an arrangement to
assist in the marketing and selling or distribution of paclitaxel injection; or
(v) Third Parties if required pursuant to any proceeding before a court of
governmental authority, provided that BNP gives NaPro notice of such required
disclosure so that NaPro may seek a protective order or other appropriate
remedy. BNP shall under no circumstances disclose any BNP Retained Information
identified in Section A of Exhibit C-1 to any Third Party which, itself or
through an Affiliate, manufactures bulk Paclitaxel.
(f) Precautions. BNP shall maintain the BNP Retained
Information as confidential, and protect the same from misuse, espionage, loss
or theft and shall not disclose the BNP Retained Information to others except as
provided in this Section 7 and shall cause any Person (other than any
governmental agency or authority) receiving BNP Retained Information to sign a
confidentiality agreement with obligations at least as strict as those contained
in this Section 7 and with respect to any governmental agency or authority,
shall use reasonable efforts to have such agency or authority maintain the
confidential nature of such BNP Retained Information.
(g) Equitable Remedies. In the event of a breach or threatened
breach by a party of the provisions of this Section 7, the non-breaching party
shall be entitled to an injunction restraining the breaching party from
disclosing, in whole or in part, such Confidential Information. Nothing herein
shall be construed as prohibiting the non-breaching party from pursuing any
other remedies available to it for such breach or threatened breach, including
the recovery of damages from the breaching party.
8. Certain Representations and Warranties.
(a) By BNP. BNP represents and warrants to NaPro as of the
date of this Agreement that (1) BNP has not disclosed any Confidential
Information received from NaPro except as permitted by the Prior Agreement, (2)
BNP has not assigned or licensed any of NaPro's
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intellectual property to any Third Party, (3) BNP has not authorized any Third
Party to market and sell any Paclitaxel product other than Knoll A.G., which
company was granted the right to distribute BNP's paclitaxel injection in
Germany, (4) other than such agreement with Knoll A.G. or agreements with
Affiliates of BNP, BNP has not entered into any marketing or distribution
contract or relationship relating to Paclitaxel, (5) BNP has disclosed to NaPro
all of BNP's material activities and material regulatory interactions regarding
development of paclitaxel injection products, and (6) other than in connection
with the agreement with Knoll A.G., BNP has not received any cash consideration
from any Third Party in return for the grant of rights or formation of a
contract or other relationship relating to Paclitaxel.
(b) By IVAX, BNP and D&N. Each of IVAX, BNP and D&N represent
and warrant to NaPro as of the date of this Agreement that (1) the execution,
delivery and performance of this Agreement by it has been duly authorized by all
requisite corporate action, (2) this Agreement has been duly executed and
delivered by it, and constitutes its legal, valid and binding obligation,
enforceable in accordance with its terms, (3) the execution, delivery and
performance of this Agreement by it do not and will not violate or conflict with
any provision of law or regulation, or any order, judgment or decree of any
court or governmental or regulatory authority, or any provision of its charter
or bylaws, or any agreement to which it is a party, (4) no consent, approval or
authorization of, or registration, qualification or filing with any governmental
or regulatory authority is required to be made by it in connection with the
execution, delivery or performance by it of this Agreement, (5) it has read and
understands this Agreement, it had the assistance of counsel in connection with
the negotiation, execution and delivery of this Agreement, and it voluntarily
entered into this Agreement and (6) with respect to D&N only, D&N has read and
is familiar with NaPro's periodic filings as filed with the United States
Securities and Exchange Commission.
(c) By NaPro. NaPro represents and warrants to BNP as of the
date of this Agreement that (1) NaPro has not disclosed any Confidential
Information received from BNP except as permitted by the Prior Agreement, (2)
Exhibit D is a complete list of all Reserved Patents, (3) except for *[TEXT
REDACTED]1, its foreign equivalents and any continuations,
continuations-in-part, divisions, reissues, renewals, extensions or additions
thereof, none of the Reserved Patents (assuming the issuance of all patent
applications)*[TEXT REDACTED], (4) assuming a noninfringing bulk drug supply,
none of the Reserved Patents would be infringed by BNP's making, using,
importing, selling or offering for sale the BNP Formulation in the BNP
Territory, (5) Exhibit H comprises a list of all countries (both within and
outside the BNP Territory) where the NaPro Patent is currently pending or
issued, (6) NaPro believes that the NaPro Patent will issue in the United
States, and, to NaPro's knowledge after due inquiry, the
- --------
1The portion of this agreement marked "*[TEXT REDACTED]" indicates that
the portion that has been omitted from this agreement and filed separately with
the Commission pursuant to a Confidential Treatment Request.
#388043
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<PAGE>
NaPro Patent, if and when issued, will be valid and enforceable; however, NaPro
makes no other representations or warranties, whether express or implied, with
respect to the NaPro Patent, (7) other than the Prior Agreement and its
agreement with Faulding dated January 19, 1994, NaPro has not entered into any
marketing or distribution contract or relationship relating to Paclitaxel, (8)
the execution, delivery and performance of this Agreement by NaPro has been duly
authorized by all requisite corporate action, (9) this Agreement has been duly
executed and delivered by NaPro, and constitutes the legal, valid and binding
obligation of NaPro, enforceable in accordance with its terms, (10) the
execution, delivery and performance of this Agreement by NaPro do not and will
not violate or conflict with any provision of law or regulation, or any order,
judgment or decree of any court or governmental or regulatory authority, or any
provision of NaPro's charter or bylaws, or any agreement to which NaPro is a
party, (11) no consent, approval or authorization of, or registration,
qualification or filing with any governmental or regulatory authority is
required to be made by NaPro in connection with the execution, delivery or
performance by NaPro of this Agreement, and (12) NaPro has read and understands
this Agreement, NaPro had the assistance of counsel in connection with the
negotiation, execution and delivery of this Agreement, and NaPro voluntarily
entered into this Agreement.
9. Standstill Agreement. IVAX agrees that for a period of ten (10)
years from the Effective Date, neither it nor any of its Affiliates will, unless
specifically invited in writing by NaPro: (a) acquire, offer or propose to
acquire, solicit an offer to sell or agree to acquire, directly or indirectly,
alone or in concert with others, by purchase or otherwise, any direct or
indirect beneficial interest in any NaPro voting securities of any type,
including debt or equity securities, or direct or indirect rights, warrants or
options to acquire, or securities convertible into or exchangeable for, any
NaPro voting securities; (b) make, or in any way participate in, directly or
indirectly, alone or in concert with others, any "solicitation" of "proxies" to
vote (as such terms are used in the proxy rules of the Securities and Exchange
Commission promulgated pursuant to Section 14 of the Exchange Act) or seek to
advise or influence in any manner whatsoever any person or entity with respect
to the voting of any NaPro voting securities; (c) form, join or in any way
participate in a "group" (within the meaning of Section 13(d)(3) of the Exchange
Act) with respect to any NaPro voting securities; (d) acquire, offer to acquire
or agree to acquire, directly or indirectly, alone or in concert with others, by
purchase, exchange or otherwise, (i) any of NaPro's assets, tangible and
intangible, or (ii) direct or indirect rights, warrants or options to acquire
any such assets, except for such assets as are then being offered for sale by
NaPro; (e) arrange, or in any way participate, directly or indirectly, in any
financing for the purchase of any NaPro voting securities or securities
convertible or exchangeable into or exercisable for any NaPro voting securities
or NaPro assets, except for such assets as are then being offered for sale by
NaPro; (f) otherwise act, alone or in concert with others, to seek or propose to
NaPro or any of its shareholders any business combination, restructuring,
recapitalization or similar transaction to or with NaPro or otherwise seek,
alone or in concert with others, to control, change or influence NaPro's
management, board of directors or policies or nominate any person as a director
of NaPro or propose any manner to be voted upon by NaPro's shareholders; or (g)
announce an
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intention to do, or enter into any agreement or understanding with others to do,
any of the actions restricted or prohibited under clauses (a) through (f) of
this Section.
10. Indemnity.
(a) NaPro Indemnity. Subject to the provisions of Section
10(c) below, NaPro shall protect, indemnify and hold harmless BNP and its
Affiliates from and against all Loss incurred by BNP, its Affiliates or its
distributors or marketing partners by reason of:
(i) Defect. Any failure of the Product supplied to BNP pursuant to
this Agreement or the Prior Agreement to meet the Specification;
(ii) Breach. The breach by NaPro of any of the obligations,
representations, warranties and covenants contained herein; and
(iii) Infringement. Any claim of patent or trade secret infringement
against such Person under the laws or regulations of the United States, Canada
or any country in the European Union relating to the manufacture, composition or
sale of the Product supplied by NaPro to BNP pursuant to this Agreement or the
Prior Agreement.
(b) BNP Indemnity. Subject to the provisions of Section 10(c)
below, BNP shall protect, indemnify and hold harmless NaPro and its Affiliates
from and against all Loss incurred by NaPro by reason of:
(i) Defect. The manufacture by BNP of any product containing the
Product (whether supplied pursuant to this Agreement or the Prior Agreement) to
the extent of a defect caused by BNP;
(ii) BNP Activities. The formulation, storage, handling, promotion,
distribution, Registration or sale of any product containing the Product or the
storage or handling of the Product by BNP, its Affiliates or its distributors
(whether supplied pursuant to this Agreement or the Prior Agreement); provided,
however, that such indemnification obligation shall not apply to legal fees and
expenses incurred by NaPro in connection with *[TEXT REDACTED]1 and
- --------
1The portion of this agreement marked "*[TEXT REDACTED]" indicates that
the portion that has been omitted from this agreement and filed separately with
the Commission pursuant to a Confidential Treatment Request.
#388043
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<PAGE>
(iii) Breach. The breach by BNP of any of the obligations,
representations, warranties and covenants contained herein.
(c) Action by Parties. Neither party shall be obligated to
indemnify and hold harmless the other from or against any Loss due to the other
party's negligence or other wrongdoing or to the extent that any such Loss is a
result of the action or inaction of the other party for which such other party
would be obligated to indemnify such party.
11. Miscellaneous Provisions.
(a) No NaPro Involvement with Clinical Development or
Marketing. The parties acknowledge and agree that NaPro has no obligation or
right, and shall not assist or counsel BNP regarding BNP's clinical development,
administration, marketing or distribution of any product including but not
limited to the BNP Formulation.
(b) Entire Agreement. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof, and
cancels and supersedes all prior negotiations, understandings and agreements
(including but not limited to the Prior Agreement and the Related Agreements)
between the parties concerning the subject matter hereof.
(c) Waiver and Amendment. This Agreement may not be amended
except pursuant to a written instrument signed by the parties. No right of a
party, and no breach of any term of this Agreement, can be waived and no
election under this Agreement can be made unless such waiver or election is in
writing signed by the party to be charged with such waiver or election.
(d) Governing Law. This Agreement shall be governed by the laws of the
State of New York, without regard to the choice of law principles thereof.
(e) Construction. This Agreement (including its Exhibits) were
and shall be deemed to have been drafted by the parties; accordingly, any rule
pertaining to the construction of contracts to the effect that ambiguities are
to be resolved against the drafting party shall not apply to the interpretation
of this Agreement.
(f) Severability. The provisions of this Agreement shall be
severable, and if any of them are held invalid or unenforceable, for any reason,
such provision shall be replaced with a provision which accomplishes, to the
extent possible, the original business purpose of such provision in a valid and
enforceable manner. The invalidity or unenforceability of one provision shall
not affect any other provision of this Agreement.
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(g) Notices. Any notice required or permitted to be given
under this Agreement shall be made in writing by registered mail, return receipt
requested, or by overnight courier, and shall be deemed given on the date
received. Notices to IVAX, BNP and D&N shall be sent to the appropriate company
at 4400 Biscayne Boulevard, Miami, Florida 33137, Attention: General Counsel,
and notices to NaPro shall be sent to NaPro BioTherapeutics, Inc., 6304 Spine
Road, Unit A, Boulder, Colorado 80301, Attention: Chief Executive Officer.
(h) Bankruptcy or Insolvency. For purposes of Section 365(n)
of the United States Bankruptcy Code, all rights and licenses granted under this
Agreement are, and shall be deemed to be, licenses of rights to "Intellectual
Property" as defined under Section 101(56) of such code. The parties agree that
BNP, as a licensee of such rights under this Agreement, shall retain and may
fully exercise all of its rights and elections under the United States
Bankruptcy Code, including but not limited to the right to continue to exercise
the rights licensed under this Agreement following the bankruptcy of NaPro.
(i) Termination of License. In the event: (i) BNP fails to
make the payments or fails to remit the NaPro securities to NaPro as required
pursuant to Section 4(b) or Section 5 of this Agreement, (ii) BNP discloses to a
Third Party the Confidential Information of NaPro identified on Exhibit I
attached hereto in violation of Section 7, or (iii) Section 8(a)(1) of this
Agreement is not true in all material respects, then NaPro shall have the right
to terminate the License, provided that BNP shall first be given a sixty (60)
day period in which to cure any such breach of clauses (ii) or (iii). BNP shall
have the right to terminate the License at any time upon written notice to
NaPro. In the event of any termination pursuant to this Section 11(i), BNP shall
have no obligation to make any payments to NaPro under Section 4(b) which would
be due after the date of termination.
(j) Publicity. Each of NaPro and IVAX shall issue a press
release in the form attached hereto as Exhibits J-1 and J-2, respectively, at a
mutually agreed time (the "Initial Release"). Thereafter, the parties will
consult with each other before issuing any press release or otherwise making any
public statements with respect to this Agreement, the Prior Agreement or the
relationship between the parties and shall not issue any such press release or
make any such public statements without the prior written approval of the other
party, except (1) either party may make public statements (other than in the
form of a press release) to the extent such statements are consistent with the
Initial Release and do not disclose any information which was not disclosed in
the Initial Release or is not publicly available as a result of a disclosure
made pursuant to clause (2) of this paragraph; and (2) to the extent required by
applicable law or the rules of any applicable stock exchange, in which case the
issuing party shall use its best efforts to consult with the other party before
issuing any such release or making any such public statement.
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(k) Execution. This Agreement may be executed by facsimile and
in any number of counterparts, each of which when so executed shall be deemed to
be an original and all of which when taken together shall constitute this
Agreement.
* * * * *
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
Effective Date.
NaPro BioTherapeutics, Inc. IVAX Corporation
By: /s/ Leonard P. Shaykin By: /s/ David R. Bethune
Leonard P. Shaykin David R. Bethune
Chairman of the Board President and
Chief Operating
Officer
Baker Norton Pharmaceuticals, Inc. D&N Holding Company
By: /s/ David R. Bethune By: /s/ Armando A. Tabernilla
David R. Bethune Armando A. Tabernilla
President Secretary
#388043
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Exhibit 99.2
ESCROW AGREEMENT
THIS ESCROW AGREEMENT (this "Agreement"), dated as of March
24, 1998, is by and among NaPro BioTherapeutics, Inc., a Delaware corporation
("NaPro"), Baker Norton Pharmaceuticals, Inc., a Florida corporation ("BNP"),
and U.S. Bank National Association d/b/a Colorado National Bank (the "Escrow
Agent").
WHEREAS, NaPro, BNP, IVAX Corporation, a Florida corporation
("IVAX") and D&N Holding Company, a Delaware corporation ("D&N") are parties to
that certain Termination Agreement dated as of the same date hereof
("Termination Agreement"), pursuant to which BNP has agreed, inter alia, to
deposit two million dollars ($2,000,000) in an escrow account for release to
NaPro upon certain events set forth in such Termination Agreement; and
WHEREAS, this Agreement is being entered into in conjunction
with the Termination Agreement so as to govern the administration of such escrow
account;
NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
1. Definitions. All capitalized terms used and not defined herein shall
have the meanings ascribed to such terms in the Termination Agreement.
2. Deposit of Funds.
(a) Deposit. BNP shall deliver herewith to the Escrow Agent the sum of two
million dollars ($2,000,000) by means of wire transfer. Such amount plus any
interest thereon, products and proceeds thereof, and any such amounts remaining
after disbursements made pursuant to the terms and conditions of this Agreement
are hereinafter referred to as the "Deposit". The Escrow Agent hereby agrees to
hold the Deposit in a separate and distinct interest-bearing account (the
"Escrow Account") as a trust fund. Except as set forth in Section 5(b) hereof,
the Deposit shall not be subject to any lien, attachment, trustee process, or
any other judicial process of any creditor of any party hereto, and shall be
used solely for the purposes of and subject to the terms and conditions of this
Agreement.
(b) Permissible Investments. The Escrow Agent shall follow the written
instructions of BNP with respect to the investment, reinvestment, purchase, or
sale of all amounts in the Escrow Account; provided, that permissible
investments shall be limited to any of the following (the following to be
referred to herein as the "Permissible Investments"): (i) marketable obligations
issued and guaranteed by the United States of America or its agencies or
instrumentalities, having maturities not exceeding thirty (30) days; (ii) bank
certificates of deposit having maturities not exceeding thirty (30) days issued
by United States national banks with assets in excess of one hundred million
dollars ($100,000,000); (iii) commercial paper rated at least "Prime
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1" by Moody's Investors Service, Inc. or "A-1" by Standard & Poor's Corporation
and having a maturity of not more than thirty (30) days; (iv) money market
mutual funds with daily liquidity that invests primarily in the Permissible
Investments; and (v) such other investments as BNP and NaPro may agree upon in
writing, provided that the Escrow Agent has been duly notified in writing of
such agreed upon investments. In the event that the Escrow Agent does not
receive investment instructions upon receipt of the Deposit, the Escrow Agent
shall, pending alternative investment instructions, invest the funds in mutual
funds, including First American Mutual Funds, investing in securities or
obligations that are Permissible Investments under this Agreement, including any
mutual fund from which the Escrow Agent or any of its Affiliates may receive
compensation.
3. Disbursement of Deposit.
(a) Disbursement on Delivery of Product. Upon shipment of Product by NaPro
to BNP, NaPro shall provide the Escrow Agent and BNP with (i) a copy of the
Certificate of Analysis for the shipped Product, (ii) a copy of the shipping
documents for such Product, and (iii) a document signed by an officer of NaPro
certifying the amount shipped and the total quantity of Product shipped to BNP
since the date of this Agreement. The Escrow Agent shall forward a copy of such
documents to BNP by facsimile. In the event BNP does not provide the Escrow
Agent with a written objection to disbursement of the Deposit within ten (10)
days of receipt of the foregoing information by BNP from the Escrow Agent, the
Escrow Agent shall disburse to NaPro the amount of the Deposit corresponding to
the amount of Product shipped by NaPro to BNP, as set forth on Exhibit A
attached hereto. Such disbursement shall be made by wire transfer of immediately
available funds.
(b) Disbursement on Cancellation. Upon cancellation of the remaining
scheduled deliveries of Product by BNP pursuant to Section 6(b)(iv) of the
Termination Agreement, BNP shall send a copy of the notice of cancellation to
both NaPro and the Escrow Agent. The Escrow Agent shall forward a copy of any
such cancellation notice to NaPro by facsimile. In the event that NaPro does not
provide the Escrow Agent with a written objection to disbursement of the Deposit
within ten (10) days of receipt of the cancellation notice by NaPro from the
Escrow Agent, the Escrow Agent shall disburse to BNP the entire balance of the
Deposit. Such disbursement shall be made by wire transfer of immediately
available funds to an account designated by BNP.
(c) Investment Earnings. In order to comply with IRS reporting
requirements, the Escrow Agent is hereby directed to allocate investment
earnings on the Deposit to NaPro, and to pay the investment earnings to NaPro
monthly as they are earned.
4. Termination. This Escrow Agreement shall automatically
terminate on the date on which all amounts in the Escrow Account have been
distributed pursuant to the provisions of Section 3 hereof; provided, however,
if the Deposit is not distributed pursuant to Section 3 hereof on or before
March 20, 2013, the Escrow Agent is instructed to release and then distribute
the Deposit in the Escrow Account to BNP. Upon release of the Deposit hereunder,
the Escrow Agent shall be relieved of all liability arising under this
Agreement.
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5. The Escrow Agent.
(a) Escrow Agent's Conduct. In performing its duties hereunder, the Escrow
Agent may, without liability for sufficiency, correctness, or validity thereof,
rely on statements, writings, or signatures furnished to it by the parties
hereto, or on any other evidence deemed by the Escrow Agent to be reliable. The
Escrow Agent's duties shall be limited to the safekeeping of the Escrow Account
and discharge of same in accordance with the written instructions described
above. The Escrow Agent undertakes to perform only such duties as are expressly
set forth herein, and no implied duties or obligations shall be read into this
Agreement with respect to the Escrow Agent. The Escrow Agent shall not be liable
for any act it may do or omit to do as agent, while acting in good faith and in
the exercise of its own best judgment. Any act done or omitted by the Escrow
Agent on the advice of its own attorneys shall be deemed conclusively to have
been done or omitted in good faith. The Escrow Agent shall have the right at any
time to consult with counsel on any question arising under this Agreement. The
Escrow Agent shall incur no liability for any delay reasonably required to
obtain the advice of counsel. The Escrow Agent shall not be a party to and shall
not be bound by any agreements related hereto other than this Agreement.
Furthermore, the Escrow Agent shall have no duty to know or determine the
performance or nonperformance of any provision of any agreement that exists
between BNP and NaPro and/or any other third parties.
(b) Escrow Agent's Fees and Expenses. The Escrow Agent shall receive fees
for performance of this Agreement, and shall be entitled to the payment of
reasonable out-of-pocket expenses, including reasonable attorneys' fees, if any,
incurred in connection with performing its duties hereunder, which fees and
expenses shall be billed directly to and paid by NaPro, it being understood that
the payment of such fees and expenses shall be deemed to satisfy in full any
obligations on the part of the parties hereto with respect to the Escrow Agent.
The Escrow Agent's fees for the performance of ordinary duties are as follows:
(i) setting up fees equal to five hundred dollars ($500), (ii) annual fees
(payable in advance, per year or any portion thereof) equal to one thousand
dollars ($1000), billed quarterly at two hundred fifty dollars ($250) or any
portion thereof, and (iii) fifty dollars ($50) per buy or sell of any investment
other than First American Mutual Fund investments. The Escrow Agent shall have a
first and prior lien on the Deposit to secure its indemnification and payment of
fees and expenses. In the event payment is not received promptly from NaPro, the
Escrow Agent is authorized to deduct fees and expenses first from the investment
earnings otherwise payable to NaPro, and then from any remaining Deposit.
(c) New Escrow Agent. The Escrow Agent may, upon ten (10) business days
written notice to each of NaPro and BNP, resign and cease acting as Escrow
Agent. NaPro and BNP may at any time remove the Escrow Agent with or without
cause by an instrument signed by BNP and NaPro and delivered to the Escrow
Agent. If the Escrow Agent shall resign or cease to act as Escrow Agent, BNP and
NaPro shall mutually agree upon a successor, which will be deemed to be the
Escrow Agent for all purposes of this Agreement. The Escrow Agent shall, upon
selection of a successor, deliver the amount in the Escrow Account to such
successor and shall be relieved from any further liability and responsibility
under this Agreement.
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(d) Protection of Escrow Agent. In consideration of the acceptance of this
escrow by the Escrow Agent, the parties hereby agree, jointly and severally, for
themselves and their successors and assigns, that (i) any party may examine the
books and records evidencing the Escrow Account at any time at the office of the
Escrow Agent during the Escrow Agent's normal business hours; (ii) no
assignment, transfer, conveyance, or hypothecation of any right, title, or
interest of any party or its successor in and to the Escrow Account shall be
binding upon the Escrow Agent, unless and until written evidence of such
assignment, transfer, conveyance, or hypothecation in form satisfactory to the
Escrow Agent shall be filed with and accepted by the Escrow Agent; (iii) the
Escrow Agent shall not be personally liable for any act it may do or omit to do
as Escrow Agent under this Agreement, unless resulting from gross negligence or
wilful misconduct; (iv) the Escrow Agent may disregard any and all notices or
warnings given by any of the parties hereto (except notices expressly envisioned
in this Escrow Agreement), or by any other person or entity, excepting only
orders or process of court, and is hereby expressly authorized to comply with
and obey any and all orders, judgments, or decrees of any court reasonably
believed by the Escrow Agent to have jurisdiction of the subject matter and the
parties, and in case the Escrow Agent obeys or complies with any such order,
judgment, or decree of any such court it shall not be liable to any of the
parties hereto or to any other person or entity by reason of such compliance,
notwithstanding any such order, judgment, or decree being subsequently reversed,
modified, annulled, set aside or vacated, or found to have been entered without
jurisdiction; and (v) NaPro and BNP shall jointly, but not severally, indemnify
and hold the Escrow Agent harmless as to any loss, claim, damage, or liability
incurred by the Escrow Agent to any other person or entity by reason of the
Escrow Agent's having acted as Escrow Agent hereunder, or in connection herewith
(collectively, "Losses"), other than those Losses resulting from the Escrow
Agent's gross negligence or willful misconduct.
(e) Interpleader. In the event of any disagreement or uncertainty regarding
the determination of the arbitrators pursuant to Section 6(f) of this Agreement,
the interpretation of this Agreement, the rights and obligations set forth in
this Agreement, or the propriety of any action contemplated to be taken by the
Escrow Agent hereunder, the Escrow Agent may, in its sole discretion, file an
action in interpleader to resolve such disagreement or uncertainty. The Escrow
Agent shall be entitled to recover from the parties hereto all reasonable fees
and expenses in connection with the filing of any such action.
(f) Reports. The Escrow Agent shall furnish NaPro and BNP with written
reports on a monthly basis as to the amount of funds contained in the Escrow
Account, the investments contained in the Escrow Account, and describing each
transaction made with respect to this Agreement during the term of this
Agreement.
6. Miscellaneous.
(a) Counterparts. This Agreement may be executed by facsimile and in one or
more counterparts, all of which taken together will constitute one and the same
agreement.
(b) Governing Law. All questions concerning the construction, validity, and
interpretation of this Agreement will be governed by and construed in accordance
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with the domestic laws of the State of New York, without giving effect to any
choice of law or conflict of law provision or rule (whether of the State of New
York or any other jurisdiction) that would cause the application of the laws of
any jurisdiction other than the State of New York.
(c) Notices. All notices, communications, and deliveries hereunder shall be
made in writing by registered mail, return receipt requested, or by overnight
courier, and shall be deemed given on the date received. Notices shall be sent
to the following addresses:
To the Escrow Agent:
Colorado National Bank
950 17th Street
Denver, Colorado 80202
Fax: 303-585-6865
Attn: Adam Dalmy
Corporate Trust Department
To NaPro:
NaPro BioTherapeutics, Inc.
6304 Spine Road, Unit A
Boulder, Colorado 80301
Fax: 303-530-1296
Attn: Chief Executive Officer
To BNP:
Baker Norton Pharmaceuticals, Inc.
4400 Biscayne Boulevard
Miami, Florida 33137
Fax: 305-575-6049
Attn: General Counsel
or to such other representative or at such other address of a party as such
party hereto may furnish to the other parties in writing.
(d) Successors and Assigns. All covenants and agreements contained in this
Agreement by or on behalf of any of the parties hereto will bind and inure to
the benefit of the respective successors and assigns of the parties hereto
whether so expressed or not.
(e) Entire Agreement. This Agreement and the Termination Agreement contain
the complete agreement between the parties and supersede any prior
understandings,
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agreements or representations by or between the parties, written or oral, which
may have related to the subject matter hereof in any way.
(f) Arbitration. Any dispute of the parties arising out of or in connection
with this Agreement, including any question regarding its existence,
interpretation, validity, or termination shall be submitted to binding
arbitration pursuant to the Commercial Arbitration Rules of the American
Arbitration Association (the "AAA"). If any such dispute arises, the aggrieved
party shall give the other party written notice of such controversy, claim, or
dispute in accordance with Section 6(c) hereof, and if the parties are unable in
good faith to resolve such controversy, claim, or dispute within ten (10) days
of such notice, NaPro and BNP shall have thirty (30) days to each select an
arbitrator, and such arbitrators shall together choose a third arbitrator within
thirty (30) days. If one party does not designate an arbitrator within thirty
(30) days, the other party shall notify the AAA who shall designate an
arbitrator for the nonselecting party. Within sixty (60) days after their
selection, the arbitrators shall submit a written report of their determination
to the parties hereto. The determination of a majority of the arbitrators shall
be binding upon the parties hereto. The losing party shall pay all costs of all
arbitrators and all other costs of the arbitration; provided, that such costs
shall not include either party's legal fees or preparation costs associated with
such arbitration. Any decision, determination, or award rendered as a result of
such arbitration shall be final, conclusive, and binding on the parties hereto
and may be reduced to judgment in any appropriate court having jurisdiction
thereof in accordance with the provisions of any applicable law relating
thereto. The arbitration shall be conducted in New York, New York. Escrow Agent
shall not be a party to any arbitration, but shall cooperate with parties and
arbitrators in providing requested information about the Escrow Account.
(h) Amendments. This Escrow Agreement may be amended or modified at any
time or from time to time in a writing executed by NaPro, BNP and the Escrow
Agent.
(i) Severability. The provisions of this Agreement shall be severable, and
if any of them are held invalid or unenforceable, for any reason, such provision
shall be replaced with a provision which accomplishes, to the extent possible,
the original business purpose of such provision in a valid and enforceable
manner. The invalidity or unenforceability of one provision shall not affect any
other provision of this Agreement.
* * * * *
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this
Escrow Agreement as of the day and year first set forth above.
NAPRO BIOTHERAPEUTICS, INC.
By: /s/ Leonard P. Shaykin
Name: Leonard P. Shaykin
Title: Chairman of the Board
BAKER NORTON PHARMACEUTICALS, INC.
By: /s/ArmandoTabernilla
Name: Armando Tabernilla
Title: Secretary
U.S. BANK NATIONAL ASSOCIATION
D/B/A COLORADO NATIONAL BANK
By: /s/ Adam M. Dalmy
Name: Adam M. Dalmy
Title: Vice President
- - 7 -
<PAGE>
Exhibit 99.3
March 20, 1998
Leonard P. Shaykin
c/o NaPro BioTherapeutics, Inc.
6304 Spine Road, Unit A
Boulder, Colorado 80301
NaPro BioTherapeutics, Inc.
6304 Spine Road, Unit A
Boulder, Colorado 80301
Attn: Sterling K. Ainsworth
Chief Executive Officer
Gentlemen:
As you know, Mr. Shaykin ("Shaykin") and D&N Holding Company ("D&N"), a
wholly-owned subsidiary of IVAX Corporation ("IVAX"), are parties to a Warrant
Purchase Agreement (the "Purchase Agreement") dated as of March 29, 1996,
pursuant to which D&N transferred to Shaykin a Stock Purchase Warrant, dated
June 7, 1993, to purchase 111,111 shares of the Common Stock, par value $.0075,
of NaPro BioTherapeutics, Inc. ("NaPro"), in exchange for a promissory note in
the principal amount of $944,443.50 (the "Note").
This letter will confirm that, subject to (1) the execution and
delivery of this letter by Shaykin and NaPro, (2) the execution and delivery of
the Termination Agreement among IVAX, Baker Norton Pharmaceuticals, Inc., D&N
and NaPro, by NaPro, and (3) the payment by Shaykin to D&N of $100,000 by wire
transfer of immediately available funds to an account designated by D&N within 3
business days after the date of this letter, D&N agrees to forgive the
indebtedness represented by Note, to cancel the Note and deliver it to Shaykin
marked "canceled," and to deliver the Warrant, which D&N is holding on Shaykin's
behalf, to NaPro for cancellation.
NaPro agrees to indemnify and hold harmless D&N, IVAX, and their
affiliates, and the directors, officers, employees and agents of D&N, IVAX and
their affiliates, from, against and in respect of, the full amount of any and
all liabilities, damages, claims, deficiencies, fines assessments, losses,
penalties, interest, costs and expenses, including, without limitation,
reasonable fees and disbursements of counsel, arising from, in connection with,
or incident to this letter agreement, the cancellation and delivery of the Note,
and the delivery of the Warrant to NaPro.
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<PAGE>
Leonard P. Shaykin
NaPro BioTherapeutics, Inc.
March 20, 1998
Page 2
D&N represents to Shaykin that it has not assigned the Note or any
portion of it to any person, that no other person has beneficial interest in the
Note, and that it the owner of the Note.
If you are in agreement with the foregoing, please execute this letter
in the space provided below and it shall continue a binding agreement among the
parties.
D&N Holding Company,
By: /s/ Armando A. Tabernilla
Armando A. Tabernilla
Secretary
Agreed:
/s/Leonard P. Shaykin Date: March 20, 1998
Leonard P. Shaykin
NaPro BioTherapeutics, Inc.
By: /s/Sterling K. Ainsworth Date: March 20, 1998
Sterling K. Ainsworth
Chief Executive Officer
#388046
<PAGE>
Exhibit 99.4
NaPro Release
TO ALL TO WHOM THESE PRESENTS SHALL COME OR MAY CONCERN, KNOW THAT
NAPRO BIOTHERAPEUTICS, INC., a Delaware corporation with its principal place of
business at 6304 Spine Road, Unit A, Boulder, Colorado 80301 ("NaPro"), on
behalf of itself and each of its officers, directors, affiliates, divisions,
subsidiaries, employees, agents and attorneys (and the predecessors, heirs,
executors, administrators and successors of each of the foregoing) (herein
separately and collectively, the "Releasors"), in consideration of good and
valuable consideration received from IVAX CORPORATION ("IVAX"), BAKER NORTON
PHARMACEUTICALS, INC. ("BNP"), and D&N HOLDING COMPANY ("D&N"), the receipt and
sufficiency of which are hereby acknowledged, hereby releases and forever
discharges IVAX, BNP and D&N and each of their respective officers, directors,
affiliates, divisions, subsidiaries, employees, agents (including without
limitation Paine Webber) and attorneys (and the predecessors, heirs, executors,
administrators and successors of each of the foregoing) (herein separately and
collectively, the "Releasees") from any and all claims, demands, actions, causes
of action, and suits, in law or in equity, whether now known or unknown
(collectively, the "Actions") which the Releasors ever had or now have, or
hereafter can, shall or may have, for, upon or by reason of any manner, cause or
thing whatsoever, arising from the beginning of the world through the day of the
date of this Release relating to or arising from (1) the parties' relationship
and collaboration regarding paclitaxel, (2) an agreement between NaPro and BNP,
dated June 7, 1993, as amended April 12, 1994 and January 25, 1996, relating to
the manufacture, marketing and distribution of paclitaxel, and (3) the following
agreements between NaPro and D&N: a Subscription Agreement dated as of June 7,
1993, a Stockholders Agreement dated as of June 7, 1993, a Registration
Agreement dated as of June 7, 1993, a Subscription Agreement dated as of April
12, 1994, and a Registration Rights Agreement dated as of April 12, 1994.
Releasors represent and warrant that they have duly considered,
approved and authorized the Agreement, dated March 19, 1998 (the "Agreement")
and this Release, that they have consulted with counsel and taken all necessary
actions for the Agreement and this Release to be valid and binding, and that the
execution of the Agreement and this Release by the undersigned signatories on
behalf of NaPro duly binds and commits NaPro and its officers, directors,
affiliates, divisions, subsidiaries, employees, agents and attorneys (and the
predecessors, heirs, executors, administrators and successors of each of the
foregoing).
Releasors represent and warrant that Releasors have not sold, assigned,
transferred, conveyed or otherwise disposed of any claim, demand, action, cause
of action, or suit, in law or in equity, or any part thereof, relating to any
matter covered by this Release and agree to indemnify Releasees against any and
all such claims, demands, actions, causes of action, or suits by third parties
resulting from such sale, assignment, transfer, conveyance or other disposition.
This Release is and may be pleaded as a full and complete defense to,
and is and may be used as the basis for an injunction against prosecution of,
any claim or action which seeks recovery or relief contrary to the terms of this
Release. Should any Releasors or Releasees retain
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<PAGE>
counsel for the purpose of restraining, enjoining, or otherwise preventing the
breach of, or enforcing, this Release, including without limitation the
commencement or institution of any action or proceeding to enforce any provision
of this Release or to obtain (a) damages by reason of any alleged breach of any
provision hereof, (b) a declaration of the rights or obligations of any
Releasors or any Releasees or (c) any other judicial remedy in connection
therewith, the prevailing party shall be entitled, in addition to such other
relief as may be granted in such action or proceeding, whether at trial or on
appeal, to be reimbursed by the other party for all costs and expenses incurred
as a result thereof including without limitation reasonable attorneys' fees and
costs for services rendered to such prevailing party.
This Release shall not be altered or modified in any way except by the
written consent of the authorized representatives of Releasors and Releasees.
This Release in no way affects the respective rights and obligations of
the parties under the Agreement.
This Release shall be governed by the laws of the State of New York.
IN WITNESS WHEREOF, Releasors have caused this Release to be executed
by their duly authorized officers and agents as of March 20, 1998.
NaPro BioTherapeutics, Inc.
By: /s/ Leonard P. Shaykin
Leonard P. Shaykin
Chairman of the Board
STATE OF NEW YORK )
COUNTY OF NEW YORK ) ss.:
On this 20th day of March 1998, before me personally appeared
Leonard P. Shaykin, to me known, who, being duly sworn, did depose and say that
he is the Chairman of the Board of NaPro BioTherapeutics, Inc., and who executed
the foregoing certification in my presence.
/s/ Martha M. Toohig
Notary Public
#388226
<PAGE>
Exhibit 99.5
IVAX, BNP and D&N Release
TO ALL TO WHOM THESE PRESENTS SHALL COME OR MAY CONCERN, KNOW THAT IVAX
CORPORATION, a Florida corporation with its principal place of business at 4400
Biscayne Boulevard, Miami, Florida 33137 ("IVAX"), BAKER NORTON PHARMACEUTICALS,
INC., a Florida corporation with its principal place of business at 4400
Biscayne Boulevard, Miami, Florida 33137 ("BNP") and D&N HOLDING COMPANY, a
Delaware corporation with its principal place of business at 4400 Biscayne
Boulevard, Miami, Florida 33137 ("D&N"), on behalf of themselves and each of
their respective officers, directors, divisions, subsidiaries, employees, agents
and attorneys (and the predecessors, heirs, executors, administrators and
successors of each of the foregoing) (herein separately and collectively, the
"Releasors"), in consideration of good and valuable consideration received from
NAPRO BIOTHERAPEUTICS, INC. ("NaPro"), the receipt and sufficiency of which are
hereby acknowledged, hereby releases and forever discharges NaPro and its
officers and directors and affiliates, divisions, subsidiaries, employees,
agents (including without limitation Lehman Brothers) and attorneys (and the
predecessors, heirs, executors, administrators, successors and assigns of each
of the foregoing) (herein separately and collectively, the "Releasees") from any
and all claims, demands, actions, causes of action, and suits, in law or in
equity, whether now known or unknown (collectively, the "Actions") which the
Releasors ever had or now have, or hereafter can, shall or may have, for, upon
or by reason of any manner, cause or thing whatsoever, arising from the
beginning of the world through the day of the date of this Release,
relating to or arising from (1) the parties' relationship and collaboration
regarding paclitaxel, (2) an agreement between NaPro and BNP, dated June 7,
1993, as amended April 12, 1994 and January 25, 1996, relating to the
manufacture, marketing and distribution of paclitaxel, and (3) the following
agreements between NaPro and D&N: a Subscription Agreement dated as of June 7,
1993, a Stockholders Agreement dated as of June 7, 1993, a Registration
Agreement dated as of June 7, 1993, a Subscription Agreement dated as of April
12, 1994, and a Registration Rights Agreement dated as of April 12, 1994.
Releasors represent and warrant that they have duly considered,
approved and authorized the Agreement, dated March 19, 1998 (the "Agreement")
and this Release, that they have consulted with counsel and taken all necessary
actions for the Agreement and this Release to be valid and binding, and that the
execution of the Agreement and this Release by the undersigned signatories on
behalf of IVAX, BNP and D&N duly binds and commits IVAX, BNP and D&N and each of
their respective officers, directors, affiliates, divisions, subsidiaries,
employees, agents and attorneys (and the predecessors, heirs, executors,
administrators, successors and assigns of each of the foregoing).
Releasors represent and warrant that Releasors have not sold, assigned,
transferred, conveyed or otherwise disposed of any claim, demand, action, cause
of action, or suit, in law or in equity, or any part thereof, relating to any
matter covered by this Release and agree to indemnify Releasees against any and
all such claims, demands, actions, causes of action, or suits by third parties
resulting from such sale, assignment, transfer, conveyance or other disposition.
This Release is and may be pleaded as a full and complete defense to,
and is and may be used as the basis for an injunction against prosecution of,
any claim or action which seeks recovery or relief contrary to the terms of this
Release. Should any Releasors or Releasees retain
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<PAGE>
counsel for the purpose of restraining, enjoining, or otherwise preventing the
breach of, or enforcing, this Release, including without limitation the
commencement or institution of any action or proceeding to enforce any provision
of this Release or to obtain (a) damages by reason of any alleged breach of any
provision hereof, (b) a declaration of the rights or obligations of any
Releasors or any Releasees or (c) any other judicial remedy in connection
therewith, the prevailing party shall be entitled, in addition to such other
relief as may be granted in such action or proceeding, whether at trial or on
appeal, to be reimbursed by the other party for all costs and expenses incurred
as a result thereof including without limitation reasonable attorneys' fees and
costs for services rendered to such prevailing party.
This Release shall not be altered or modified in any way except by the
written consent of the authorized representatives of Releasors and Releasees.
This Release shall be governed by the laws of the State of New York.
This Release in no way affects the respective rights and obligations of
the parties under the Agreement.
IN WITNESS WHEREOF, Releasors have caused this Release to be executed
by their duly authorized officers and agents as of March 20, 1998.
IVAX Corporation
By: /s/ David R. Bethune
David R. Bethune
President and Chief Operating Officer
STATE OF FLORIDA )
COUNTY OF DADE ) ss.:
On this 20th day of March 1998, before me personally appeared
David R. Bethune, to me known, who, being duly sworn, did depose and say that he
is the President and Chief Operating Officer of IVAX Corporation and who
executed the foregoing certification in my presence.
/s/ Carole Amster
Notary Public
#388226
<PAGE>
Baker Norton Pharmaceuticals, Inc.
By: /s/ David R. Bethune
David R. Bethune
President
STATE OF FLORIDA )
COUNTY OF DADE ) ss.:
On this 20th day of March 1998, before me personally appeared
David R. Bethune, to me known, who, being duly sworn, did depose and say that he
is the President of Baker Norton Pharmaceuticals, Inc. and who executed the
foregoing certification in my presence.
/s/ Carole Amster
Notary Public
D&N Holding Company
By: /s/Armando A. Tabernilla
Armando A. Tabernilla
Secretary
STATE OF FLORIDA )
COUNTY OF DADE ) ss.:
On this 20th day of March 1998, before me personally appeared
Armando A. Tabernilla, to me known, who, being duly sworn, did depose and say
that he is the Secretary of D&N Holding Company and who executed the foregoing
certification in my presence.
/s/ Carole Amster
Notary Public
#388226
<PAGE>
Exhibit 99.6
Press Release
CONTACT:
Gordon Link Janet Dally (investors)
NaPro BioTherapeutics, Inc. Justin Jackson (media)
VP and Chief Financial Officer Burns McClellan, Inc.
(303) 530-3891 (212) 213-0006
For Immediate Release
NAPRO AND IVAX TERMINATE PACLITAXEL
DEVELOPMENT AND MARKETING AGREEMENT
Boulder, Colo., March 19, 1998 - NaPro BioTherapeutics, Inc. (Nasdaq: NPRO)
today announced that NaPro and Baker Norton Pharmaceuticals, Inc., a wholly
owned subsidiary of IVAX Corporation (AMEX: IVX), have terminated their
paclitaxel development and marketing agreement dating from 1993.
Under terms of the termination agreement, IVAX will receive a royalty-free,
limited, non-exclusive license to NaPro's pending patents for a stable
formulation of paclitaxel in the United States, Europe and certain other world
markets. In return, NaPro will receive a cash payment of approximately $6
million, additional payments of up to approximately $6.4 million contingent upon
the issuance of the patents in certain jurisdictions, and the return of IVAX's
approximate 1.1 million shares of NaPro common stock. NaPro will continue to
supply IVAX an agreed upon amount of paclitaxel.
"This agreement frees both IVAX and NaPro to separately pursue registration of
paclitaxel around the world, and allows both parties to form other alliances,"
said Sterling Ainsworth, NaPro President and Chief Executive Officer.
NaPro BioTherapeutics, Inc., headquartered in Boulder, Colorado, is a
biopharmaceutical company focused on the development, production and licensing
of complex natural-product pharmaceuticals.
Except for the historical matters contained herein, statements in this press
release are forward looking and are made pursuant to the safe harbor provisions
of the Securities Litigation Reform Act of 1995. Investors are cautioned that
forward looking statements involve risks and uncertainties which may affect the
company's business and prospects, including the risk that the transaction may
not close, and certain economic, competitive, governmental, technological and
other factors discussed in NaPro's filings with the Securities and Exchange
Commission.
# # #
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