Exhibit 10.2

 

 

 

RESTRUCTURING AGREEMENT

 

BETWEEN

 

BAYER CONSUMER CARE AG

 

AND

 

KYTHERA BIOPHARMACEUTICALS, INC.

 

 

 

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RESTRUCTURING AGREEMENT

 

THIS RESTRUCTURING AGREEMENT (this “Restructuring Agreement”), is entered into
as of March 7, 2014 (the “Effective Date”), by and among Bayer Consumer Care AG,
a company organized under the laws of Switzerland (“Bayer”) and KYTHERA
Biopharmaceuticals, Inc., a Delaware corporation (“Kythera”) (each, a “Party”
and together, the “Parties”) and, with respect to Article 3 and Article 6 hereof
only, Intendis GmbH, a company organized under the laws of the Federal Republic
of Germany (“Intendis”).

 

BACKGROUND

 

A.            WHEREAS, Kythera possesses certain intellectual property relating
to the use of certain deoxycholic acid-based products for the treatment of
localized fat deposits;

 

B.            WHEREAS, pursuant to the License Agreement between Kythera and
Bayer, dated as of 26 August 2010, as amended March 21, 2011 and April 2, 2012
(the “Original License Agreement”), Kythera granted to Bayer exclusive rights to
develop, manufacture and commercialize Products in the BCC Territory (each of
Products and BCC Territory as defined in the Original License Agreement);

 

C.            WHEREAS, pursuant to the Services, Research, Development and
Collaboration Agreement between Kythera and Intendis, an Affiliate (as defined
in the Original License Agreement) of Bayer, dated as of 26 August 2010, as
amended (the “Collaboration Agreement”), Kythera and Intendis agreed to
collaborate on the development of Products in the BCC Territory;

 

D.            WHEREAS, KYTHERA Holdings Ltd. (“KHL”), an Affiliate of Kythera,
wishes to acquire, by assignment and license, certain of Bayer’s rights,
information and material relating to the development, manufacture and
commercialization of Products;

 

E.            WHEREAS, in anticipation of and in furtherance of the foregoing,
Kythera and Bayer wish to amend the Original License Agreement as of the
Effective Date in the form attached hereto as Exhibit A (the “Amended License
Agreement”), and Kythera and Intendis have further agreed that the Collaboration
Agreement will terminate;

 

F.             WHEREAS, Kythera, Bayer and their respective Affiliates have
agreed that Bayer will, after the transactions contemplated by this
Restructuring Agreement have been consummated, assign to KHL all of its right,
title, and interest in and to the Amended License Agreement; and

 

G.            WHEREAS, in contemplation of the fact that Kythera and Bayer will
no longer be in privity of contract under the Amended License Agreement
following Bayer’s assignment of the Amended License Agreement to KHL, and the
fact that Kythera and Intendis will no longer be in privity of contract under
the Collaboration Agreement following the termination of the Collaboration
Agreement, the Parties and their Affiliates wish to further establish certain
terms to govern their relationship following these transactions.

 

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NOW THEREFORE, the Parties agree as follows:

 

ARTICLE 1
DEFINITIONS

 

Except as otherwise set forth below, all capitalized and undefined terms in this
Restructuring Agreement shall have the meanings set forth in the Amended License
Agreement or the Collaboration Agreement, as applicable:

 

1.1          “Amended License Agreement” has the meaning set forth in the
WHEREAS clauses.

 

1.2          “Assignment and Novation Agreement” has the meaning set forth in
Section 2.2.

 

1.3          “Bayer Indemnitees” has the meaning set forth in Section 6.1.

 

1.4          “Collaboration Agreement” has the meaning set forth in the WHEREAS
clauses.

 

1.5          “Indemnified Party” has the meaning set forth in Section 6.3.

 

1.6          “Indemnifying Party” has the meaning set forth in Section 6.3.

 

1.7          “KHL” has the meaning set forth in the WHEREAS clauses.

 

1.8          “Kythera Indemnitees” has the meaning set forth in Section 6.2.

 

1.9          “Losses” means, with respect to a Party, any and all liabilities,
expenses and/or losses, including without limitation (i) reasonable legal
expenses and attorneys’ fees for external counsel that are incurred by or on
behalf of such Party, and (ii) documented internal costs (including general and
administrative expenses) incurred by or on behalf of such Party to the extent
that such costs are charged on a basis consistent with such Party’s ordinary
business practices consistently applied, and consistent with industry standards.

 

1.10        “Original License Agreement” has the meaning set forth in the
WHEREAS clauses.

 

1.11        “Party” and “Parties” have the meanings set forth in the preamble.

 

1.12        “Restructuring Agreement” has the meaning set forth in the preamble.

 

1.13        “Third Party” means any person other than the Parties and their
respective Affiliates.

 

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ARTICLE 2
AMENDED LICENSE AGREEMENT

 

2.1                               Amended License Agreement.

 

2.1.1       Bayer and Kythera shall, simultaneously with the execution of this
Restructuring Agreement, execute the Amended License Agreement, and such Amended
License Agreement shall be considered effective at the same time as this
Restructuring Agreement is effective.

 

2.1.2       The Parties acknowledge that Bayer and Kythera have entered into the
Amended License Agreement to remove Bayer’s obligations to Develop, manufacture,
or Commercialize the Compound and Products, and that accordingly, upon and after
the Effective Date, Bayer shall have no obligations with respect to the
Development, manufacture or Commercialization of the Compound and Products, nor
shall it have any obligation, express or implied, to use Commercially Reasonable
Efforts, or any other level of efforts, in connection with such activities
except for those expressly provided in the Amended License Agreement.

 

2.2          Assignment and Novation Agreement.  Kythera and Bayer shall, on the
Effective Date, execute an agreement by which Bayer assigns and novates all of
its right, title, and interest in and to the Amended License Agreement to KHL
(such agreement, the “Assignment and Novation Agreement”).  If Bayer and KHL
fail to execute the Assignment and Novation Agreement within the time limit set
forth in this Section 2.2, the Amended License Agreement and this Restructuring
Agreement shall be deemed void nunc pro tunc.

 

ARTICLE 3
COLLABORATION AGREEMENT

 

3.1          Termination of the Collaboration Agreement.  Kythera and Intendis
hereby terminate, effective as of the Effective Date, the Collaboration
Agreement, subject to the survival of the following provisions: Sections
2.4(a) (provided that Intendis shall not have the right to review Kythera’s
records), 4.2, 4.4 (for the period set forth therein), 7.1 (solely to the extent
necessary for Intendis to assign its interest in any Intendis Developed IP and
any Joint Developed IP to KHL in accordance with the Assignment and Novation
Agreement), 10.3, 10.4, 10.5(a) (solely with regard to any rights and
obligations that survive termination), 10.8-10.14 and Articles 5 and 9.  The
Parties and Intendis acknowledge and agree that Intendis has previously invoiced
Kythera for all services performed under the Collaboration Agreement, that
Kythera has paid all outstanding invoices, including interest earned thereon,
and that Kythera may close the Development Account and transfer any funds into
any account of Kythera.

 

ARTICLE 4
REPRESENTATIONS AND COVENANTS

 

4.1          Compliance with Law.  Each Party shall comply in all material
respects with all applicable laws related to such Party’s performance of any
activities (a) required under this Restructuring Agreement or (b) reasonably
necessary in connection with any duties and obligations hereunder.

 

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4.2          Mutual Representations.  Each Party represents as follows as of the
Effective Date:

 

4.2.1       It is a corporation, company, or other entity duly organized or
incorporated, validly existing and in good standing under the laws of its
jurisdiction as set forth on the first page of this Restructuring Agreement, is
qualified to do business and is in good standing as a foreign corporation or
other entity in each jurisdiction in which the performance of its obligations
hereunder requires such qualification, and has all requisite power and
authority, corporate or otherwise, to conduct its business as now being
conducted and to execute, deliver and perform this Restructuring Agreement.

 

4.2.2       The execution, delivery and performance by it of this Restructuring
Agreement have been duly authorized by all necessary corporate action, and do
not and will not:

 

(a)           require any consent or approval of its stockholders or any
government authority, except the approvals of the applicable Regulatory
Authorities for the transfer of the MAA Approvals; or

 

(b)           violate any provision of any law, rule, regulation, order, writ,
judgment, injunction, decree, determination or award presently in effect having
applicability to it or any provision of its charter documents.

 

4.2.3       This Restructuring Agreement is legal, valid and binding and any
obligations under this Restructuring Agreement are enforceable in accordance
with their respective terms and conditions.

 

4.2.4       It is not under any obligation to any person, or entity, contractual
or otherwise, that is materially conflicting or materially inconsistent in any
respect with the terms of this Restructuring Agreement or that would materially
impede the diligent and complete fulfillment of its obligations.

 

4.3          Non-Disparagement.  Neither Party shall intentionally, and shall
cause its Affiliates not to intentionally, disparage any other Party (or its
Affiliates), verbally or in writing, in words or in substance, directly or
indirectly, in connection with any matters relating to or arising under this
Restructuring Agreement.

 

ARTICLE 5
CONFIDENTIALITY AND DISCLOSURE

 

5.1          Terms of Agreement and Related Matters.  No Party shall disclose
any terms or conditions of this Restructuring Agreement to any Third Party, nor
make any statement to the public regarding the execution or any other aspect of
the subject matter of this Restructuring Agreement, without the prior consent of
the other Parties, except as specifically set forth in this Section 5.1 or in
Section 5.2.  Notwithstanding the foregoing, any Party may make such disclosure:
(a) where a Party reasonably believes disclosure is required under applicable
laws; (b) where disclosure is required under the regulations, rules or agreement
with any applicable stock exchange; (c) for customary discussions and other
disclosures with and to shareholders,

 

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current or prospective investors and analysts and potential acquirers,
licensees, merger partners or potential providers of financing and their
advisors; (d) where information regarding the Development, Regulatory Approval
or Commercialization status of the Product is required by applicable laws or
stock exchange rules; or (e) to the extent it is consistent with the text of a
statement previously approved by the other Party.

 

5.2          Press Releases and Other Communications.  The Parties have agreed
upon the content of one (1) or more press releases (which shall be issued
substantially in the form of the language of the draft press release attached as
Exhibit B), the release of which the Parties shall coordinate promptly upon
execution of this Restructuring Agreement.  The Parties shall develop and agree
upon a set of additional communications messages consistent with the outline of
disclosure contained in Exhibit C, to be used by both Parties to further
communicate details of the Restructuring Agreement, and the business rationale
for the Restructuring Agreement, which may be released to Third Parties.

 

ARTICLE 6
INDEMNIFICATION

 

6.1          Indemnification By Kythera.  Except to the extent of any Losses
covered by Section 6.2, Kythera shall defend, indemnify and hold harmless
Bayer, Intendis, their Affiliates, and their respective directors, officers,
employees, and agents (the “Bayer Indemnitees”) from and against any and all
Losses arising out, resulting from or relating to the following (to the extent
not otherwise subject to the indemnification obligations surviving pursuant to
Section 3.1):

 

6.1.1       any material breach of a representation, warranty or covenant made
by Kythera in this Restructuring Agreement; or

 

6.1.2       any negligent act or omission or willful misconduct of any of the
Kythera Indemnitees in connection with this Restructuring Agreement.

 

6.2          Indemnification By Bayer and Intendis.  Except to the extent of any
Losses covered by Section 6.1, Bayer and Intendis shall defend, indemnify and
hold harmless Kythera, its Affiliates, and its and their respective directors,
officers, employees, and agents (the “Kythera Indemnitees”) from and against any
and all Losses arising out of a Third Party Claim arising out of, resulting from
or relating to the following (to the extent not otherwise subject to the
indemnification obligations surviving pursuant to Section 3.1):

 

6.2.1       any material breach of a representation, warranty or covenant made
by Bayer or Intendis in this Restructuring Agreement; or

 

6.2.2       any negligent act or omission or willful misconduct of any of the
Bayer Indemnitees in connection with this Restructuring Agreement.

 

6.3          Procedure.  A Party entitled to be indemnified under Section 6.1 or
6.2 (the “Indemnified Party”) shall promptly notify the other Party liable for
such indemnification (the “Indemnifying Party”) in writing of any Third Party
Claim which the Indemnified Party has

 

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determined has given or could give rise to a right of indemnification under this
Restructuring Agreement.  Failure to promptly notify the Indemnifying Party of
any such claim shall not relieve the Indemnifying Party of any such duty to so
indemnify except to the extent that the Indemnifying Party can demonstrate
actual loss and prejudice as a result of such failure.  The Indemnifying Party
shall have the obligation to control the defense of the Indemnified Party
against any such Third Party Claim, utilizing counsel chosen in the Indemnifying
Party’s sole discretion; provided, however, that the Indemnified Party may
participate in any such defense, at its own expense, by separate counsel of its
choice; provided further, that any such participation shall not limit the
Indemnifying Party’s right to control such defense.  Notwithstanding the
foregoing, the Indemnifying Party shall obtain the prior written approval of the
Indemnified Party, not to be unreasonably withheld or delayed, before
(i) admitting any liability or fault of the Indemnified Party, (ii) ceasing to
defend against any Third Party Claim or (iii) entering into any settlement,
adjustment or compromise of such Third Party Claim involving injunctive or
similar equitable relief being asserted against any Indemnified Party or any of
its Affiliates.  The Indemnified Party shall cooperate with the Indemnifying
Party in the provision of any such defense by providing to the Indemnifying
Party all such information, assistance and authority as may reasonably be
requested by the Indemnifying Party.

 

ARTICLE 7
MISCELLANEOUS

 

7.1          Entire Agreement; Amendment.  This Restructuring Agreement,
including the Exhibits hereto, sets forth the complete, final and exclusive
agreement and all the covenants, promises, agreements, warranties,
representations, conditions and understandings between the Parties hereto with
respect to the subject matter hereof and supersede, as of the Effective Date,
all prior agreements and understandings between the Parties with respect to the
subject matter hereof except as expressly set forth in this Restructuring
Agreement.  There are no covenants, promises, agreements, warranties,
representations, conditions or understandings, either oral or written, between
the Parties other than as are set forth herein and therein.  No subsequent
alteration, amendment, change or addition to this Restructuring Agreement shall
be binding upon the Parties unless reduced to writing and signed by an
authorized officer of each Party.

 

7.2          Notices.  Any notice required or permitted to be given under this
Restructuring Agreement shall be in writing, shall specifically refer to this
Restructuring Agreement, and shall be addressed to the appropriate Party at the
address specified below or such other address as may be specified by such Party
in writing in accordance with this Section 7.2, and shall be deemed to have been
given for all purposes (a) when received, if hand-delivered or sent by confirmed
facsimile or a reputable courier service, or (b) five (5) Business Days after
mailing, if mailed by first class certified or registered airmail, postage
prepaid, return receipt requested.

 

If to Kythera:

KYTHERA Biopharmaceuticals, Inc.

 

27200 West Agoura Road, Suite 200

 

Calabasas, CA 91301

 

Attention: Keith Klein, Esq., General Counsel

 

Facsimile: (818) 587-4591

 

 

With a copy to:

Latham & Watkins LLP

 

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140 Scott Drive

 

Menlo Park, CA 94025

 

Attention: Alan Mendelson, Esq. and Judith Hasko, Esq.

 

Facsimile: (650) 463-2600

 

 

If to Bayer:

Bayer Consumer Care AG

 

Peter Merian-Strabe 84

 

4052 Basel, Switzerland

 

Attention: Pascal Bürgin

 

Facsimile: +41 58 272 71 73

 

 

With a copy to:

Bayer HealthCare Consumer Care

 

100 Bayer Boulevard, P.O. Box 915

 

Whippany, NJ 07981-0915

 

Attention: William B. Dodero, Esq., Vice President & Assistant General Counsel

 

Facsimile: (862) 404-3164

 

 

And with a copy to:

Arnold & Porter LLP

 

555 Twelfth Street, N.W.

 

Washington, D.C. 20004

 

Attention: Steve Parker, Esq.

 

Facsimile: (202) 942-5999

 

 

If to Intendis:

Intendis GmbH

 

Max-Dohrn — Strabe 10

 

10589 Berlin, Germany

 

Attention: Shakaib Qureshi, Esq.

 

Facsimile: +49 30 52 00 75-645

 

 

With a copy to:

Arnold & Porter LLP

 

555 Twelfth Street, N.W.

 

Washington, D.C. 20004

 

Attention: Steve Parker, Esq.

 

Facsimile: (202) 942-5999

 

7.3          No Strict Construction; Headings.  This Restructuring Agreement has
been prepared jointly and shall not be strictly construed against any Party. 
Ambiguities, if any, in this Restructuring Agreement shall not be construed
against any Party, irrespective of which Party may be deemed to have authored
the ambiguous provision.  The headings of each Article and Section in this
Restructuring Agreement have been inserted for convenience of reference only and
are not intended to limit or expand on the meaning of the language contained in
the particular Article or Section.

 

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7.4          Assignment; Change in Control.  Except as otherwise permitted by
this Restructuring Agreement, and subject to the requirements of this
Restructuring Agreement, no Party may assign or transfer this Restructuring
Agreement, or any rights or obligations hereunder without the prior written
consent of the other, except that a Party may make such an assignment without
the other Party’s consent to (a) any of its Affiliates or (b) a successor in a
Change in Control.  Any permitted successor or assignee of rights and/or
obligations hereunder shall, in writing to the other Party, expressly assume
performance of such rights and/or obligations.  Any permitted assignment shall
be binding on the successors of the assigning Party.  Any assignment or
attempted assignment by either Party in violation of the terms of this
Section 7.4 shall be null, void and of no legal effect.

 

7.5          Further Actions.  Each Party agrees to execute, acknowledge and
deliver such further instruments, and to do all such other acts, as may be
necessary or appropriate in order to carry out the purposes and intent of this
Restructuring Agreement.

 

7.6          Severability.  If any one or more of the provisions of this
Restructuring Agreement is held to be invalid or unenforceable by any court of
competent jurisdiction from which no appeal can be or is taken, the provision
shall be considered severed from this Restructuring Agreement and shall not
serve to invalidate any remaining provisions hereof.  The Parties shall make a
good faith effort to replace any invalid or unenforceable provision with a valid
and enforceable one such that the objectives contemplated by the Parties when
entering this Restructuring Agreement may be realized.

 

7.7          No Waiver.  Any delay in enforcing a Party’s rights under this
Restructuring Agreement or any waiver as to a particular default or other matter
shall not constitute a waiver of such Party’s rights to the future enforcement
of its rights under this Restructuring Agreement, except with respect to an
express written and signed waiver relating to a particular matter for a
particular period of time.

 

7.8          Independent Contractors.  Each Party shall act solely as an
independent contractor, and nothing in this Restructuring Agreement shall be
construed to give either Party the power or authority to act for, bind, or
commit the other Party in any way, except as otherwise expressly provided in
this Restructuring Agreement.  Nothing herein shall be construed to create the
relationship of partners, principal and agent, or joint-venture partners between
the Parties.

 

7.9          Third Party Beneficiaries. This Agreement does not, and is not
intended to, confer any rights or remedies upon any person other than Bayer and
Kythera and their Affiliates, and no other person shall be considered a third
party beneficiary of the rights granted to any of Bayer or Kythera or their
Affiliates under this Agreement.

 

7.10        English Language.  This Restructuring Agreement was prepared in the
English language, which language shall govern the interpretation of, and any
dispute regarding, the terms of this Restructuring Agreement.  To the extent
this Restructuring Agreement requires a Party to provide to the other Party
Information, correspondence, notice and/or other documentation, such Party shall
provide such Information, correspondence, notice and/or other documentation in
the English language.

 

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7.11        Governing Law.  This Restructuring Agreement and all disputes
arising out of or related to this Restructuring Agreement or any breach hereof
shall be governed by and construed under the laws of the State of New York,
without giving effect to any choice of law principles that would require the
application of the laws of a different jurisdiction.

 

7.12        Counterparts.  This Restructuring Agreement may be executed in any
number of counterparts each of which shall be deemed to be an original and all
of which taken together shall constitute one and the same instrument.

 

[Signature page follows]

 

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IN WITNESS WHEREOF, the Parties hereto have caused this Restructuring Agreement
to be duly executed and delivered in duplicate originals as of the date first
above written.

 

Agreed:

BAYER CONSUMER CARE AG

 

 

 

 

 

/s/ Martin Steiner

/s/ Ernst Coppens

 

By: Martin Steiner

Ernst Coppens

 

Title: Legal Counsel

Head CAO

 

 

Agreed:

KYTHERA BIOPHARMACEUTICALS, INC.  

 

 

 

 

 

/s/ Keith R. Leonard, Jr.

 

By: Keith R. Leonard, Jr.

 

Title: President and Chief Executive Officer

 

 

Agreed, solely with respect to

INTENDIS GMBH

Articles 3 and 6:

 

 

 

 

s/ Martin Steiner

 

By: Martin Steiner

 

Title: Legal Counsel

 

[Signature page of Restructuring Agreement]

 

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EXHIBIT A

 

Amended License Agreement

 

[provided separately]

 

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EXHIBIT B

 

Initial Press Release

 

[provided separately]

 

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EXHIBIT C

 

Communication Messages

 

[provided separately]

 

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