Exhibit 10.1
ASSET PURCHASE AGREEMENT
As of April 6, 2009
     This ASSET PURCHASE AGREEMENT (this “Agreement”) is made by and between
EPIX Pharmaceuticals, Inc., a Delaware corporation (“Seller”), and Lantheus
Medical Imaging, Inc., a Delaware corporation (“Buyer”), as of the date first
written above (the “Execution Date”). Buyer and Seller also may be referred to
herein each as a “Party” and collectively as the “Parties.”
     All capitalized terms used in this Agreement are defined in Section 1.1
below.
RECITALS
     WHEREAS, Seller (i) has collaborated in the development of the Product with
Bayer, (ii) presently conducts, either directly or indirectly, the business of
the Exploitation of the Product in the Territory, (iii) has received regulatory
approval to market the Product in the Territory from the FDA, Health Canada or
the ATGA, as applicable, and (iv) is willing to transfer to Buyer all rights in,
and certain assets and liabilities relating to, the Product in the Territory on
the terms and conditions set forth herein; and
     WHEREAS, the Parties desire that Seller sell, transfer and assign (or cause
the sale, transfer and assignment) to Buyer, and Buyer acquire and assume, all
of the Purchased Assets and Assumed Liabilities, subject to the terms and
conditions of this Agreement.
     NOW, THEREFORE, in consideration of the premises and the mutual promises
herein made, and in consideration of the representations, warranties, and
covenants herein contained, the Parties agree as follows:
ARTICLE I
DEFINITIONS; INTERPRETATION
     1.1 Definitions. The following terms shall have the following meanings for
purposes of this Agreement:
     “Affiliate” as applied to any Person, means any other Person directly or
indirectly controlling, controlled by, or under common control with, that
Person. For the purposes of this definition, “control” (including, with
correlative meanings, the terms “controlling,” “controlled by” and “under common
control with”), as applied to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of that Person, whether through the ownership of voting securities or
by contract or otherwise.
     “Agreement” has the meaning set forth in the Preamble.
     “Approvals” means any approvals, permits, franchises, authorizations
(including Marketing Authorizations and variations thereto), licenses, consents,
waivers, exemptions,

 

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applications (including any new drug applications and investigational new drug
applications), certifications or similar approvals or rights issued by
Governmental Authorities (including the FDA, the Drug Enforcement
Administration, Health Canada, the ATGA and any other Governmental Authorities
in the Territory engaged in the regulation of pharmaceuticals or biohazardous
materials) that are required to be obtained or maintained under any applicable
Law (including Environmental Law), in each case, in connection with the
Purchased Assets, the Exploitation of the Product in the Territory or the
testing, handling, processing, recordkeeping, storage, warehousing, disposal,
packaging, labeling, promotion, import or export of the Product in the
Territory.
     “Assigned Contract Rights” has the meaning set forth in Section 2.1(e)(ii).
     “Assigned Contracts” has the meaning set forth in Section 2.1(e).
     “Assigned Intellectual Property” has the meaning set forth in
Section 2.1(a).
     “Assignment and Assumption Agreement” means an Assignment and Assumption
Agreement in substantially the form of Exhibit A hereto.
     “Assumed Liabilities” has the meaning set forth in Section 2.3(a).
     “ATGA” means the Australian Therapeutic Goods Administration and any
Governmental Authority successor thereto.
     “Australian Drug Law” means the Therapeutic Goods Act 1989 and implementing
regulations, as each has been or may be amended.
     “Basket Amount” has the meaning set forth in Section 8.3(b).
     “Bayer” means Schering Aktiengesellschaft.
     “Bayer Collaboration Agreement” mean the Strategic Collaboration Agreement
between Seller and Bayer dated as of June 9, 2000 (as amended).
     “Bill of Sale” means a Bill of Sale in substantially the form of Exhibit B
hereto.
     “Business Day” means, any day other than (i) a Saturday or a Sunday or
(ii) a day on which banks are authorized to close in New York, NY.
     “Buyer” has the meaning set forth in the Preamble.
     “Buyer FDA Letters” means the letters from Buyer to the FDA, duly executed
by Buyer, to be delivered to Seller at the Closing, with regard to the Vasovist
NDA and MS-325 IND 51,172, the forms of which are attached hereto as Exhibits
C-1 and C-2, respectively.
     “Buyer’s Indemnified Persons” has the meaning set forth in Section 8.1.

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     “Cap” has the meaning set forth in Section 8.3(b).
     “Canadian Drug Law” means the Canadian Food and Drugs Act and implementing
regulations, as each has been or may be amended.
     “Closing” has the meaning set forth in Section 3.3.
     “Closing Date” has the meaning set forth in Section 3.3.
     “Code” means the United States Internal Revenue Code of 1986, as amended.
     “Competing Product” means a magnetic contrast agent for (i) magnetic
resonance angiography or (ii) any other use that was investigated for the
Product under an investigational new drug application with the FDA, Health
Canada or the ATGA; provided that in no event shall EP-2104R or EP-3600 (or any
other magnetic contrast agent targeted at thrombus or collagen-binding contrast
agent) be deemed a “Competing Product” hereunder.
     “Confidential Information” has the meaning set forth in Section 10.1(a) and
(b).
     “Contract” means any contract, agreement, lease, license, commitment,
indenture, mortgage, note, bond loan or other arrangement, understanding,
undertaking, commitment or obligation, whether written or oral.
     “Convertible Senior Notes” means Seller’s 3.0% Convertible Senior Notes due
June 15, 2024 issued pursuant to the Indenture.
     “Covidien” means collectively, Mallinckrodt Inc. and United States Surgical
Corporation.
     “Disclosing Party” has the meaning set forth in Section 10.1(a).
     “Environmental Law” means any Law in any way relating to the protection of
human health and safety, the environment or natural resources, including the
Comprehensive Environmental Response, Compensation and Liability Act (42 U.S.C.
§ 9601 et seq.), the Hazardous Materials Transportation Act (49 U.S.C. App. §
1801 et seq.), the Resource Conservation and Recovery Act (42 U.S.C. § 6901 et
seq.), the Clean Water Act (33 U.S.C. § 1251 et seq.), the Clean Air Act (42
U.S.C. § 7401 et seq.), the Toxic Substances Control Act (15 U.S.C. § 2601 et
seq.), the Federal Insecticide, Fungicide, and Rodenticide Act (7 U.S.C. § 136
et seq.), and the Occupational Safety and Health Act (29 U.S.C. § 651 et seq.),
and the regulations promulgated pursuant thereto, as each has been amended.
     “Exchange Act” has the meaning set forth in Section 4.15.
     “Excluded Assets” has the meaning set forth in Section 2.2.
     “Excluded Liabilities” has the meaning set forth in Section 2.3(b).

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     “Exclusive Negotiation Period” has the meaning set forth in Section 6.8(b).
     “Execution Date” has the meaning set forth in the Preamble.
     “Exploitation” (including, with correlative meanings, the terms “Exploit”
and “Exploited”) means research, development, manufacturing, marketing,
distribution, commercialization, sale, use or other exploitation.
     “FDA” means the United States Food and Drug Administration and any
Governmental Authority successor thereto.
     “FFDCA” means the Federal Food, Drug, and Cosmetic Act and implementing
regulations, as each has been or may be amended.
     “Fundamental Representations” has the meaning set forth in Section 8.3(a)
     “GAAP” means generally accepted accounting principles in the United States
as of the date hereof.
     “General IP Assignment” means a general assignment of the Assigned
Intellectual Property (other than the Patents assigned pursuant to the Patent
Assignments) in substantially the form of Exhibit D hereto.
     “Governmental Authority” means any government or governmental or regulatory
body thereof, or political subdivision thereof, whether foreign, federal, state
or local, or any department, commission, bureau, agency, board, instrumentality
or authority thereof, or any court or arbitrator (public or private) and
including specifically those of each country in the Territory.
     “Hatch-Waxman Act” means the “Drug Price Competition and Patent Term
Restoration Act of 1984,” Pub. L. No. 98-417, 98 Stat. 1585 (1984).
     “Health Canada” means Health Canada and any Governmental Authority
successor thereto.
     “Indebtedness” of any Person means and includes the principal of and
accreted value and unpaid interest in respect of: (i) indebtedness for borrowed
money or indebtedness issued or incurred in substitution or exchange for
indebtedness for borrowed money; (ii) amounts owing as the deferred purchase
price for property or services; (iii) indebtedness evidenced by any note, bond,
debenture or other debt instrument or debt security, the payment of which such
Person is responsible or liable; (iv) obligations of the type referred to in
clauses (i) through (iii) of any Persons the payment of which such Person is
responsible or liable, directly or indirectly, as obligor, guarantor, surety or
otherwise; and (v) obligations of the type referred to in clauses (i) through
(iii) of other Persons secured by any Lien on any property or asset of such
Person.
     “Indemnification Claim” has the meaning set forth in Section 8.4(b).

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     “Indemnifying Party” has the meaning set forth in Section 8.4(b).
     “Indemnified Persons” shall mean the Buyer’s Indemnified Persons or the
Seller’s Indemnified Persons, as the case may be.
     “Indenture” means the Indenture relating to the Convertible Senior Notes,
dated as of June 7, 2004, into which Seller, as issuer, and U.S. Bank National
Association, as trustee, have entered, as may by amended, modified or
supplemented from time to time.
     “Intellectual Property” means all right, title and interest in or relating
to intellectual property, whether protected, created or arising under the Laws
of the United States or any other jurisdiction, including: (i) all patents and
applications therefor, including all continuations, divisionals, patents of
additions and continuations-in-part thereof and patents issuing thereon, along
with all reissues, reexaminations and extensions thereof, including all
supplemental protection certificates (collectively, “Patents”); (ii) all
trademarks, service marks, trade names, service names, brand names, trade dress
rights, logos, corporate names, trade styles, logos and other source or business
identifiers and general intangibles of a like nature, together with the goodwill
associated with any of the foregoing, along with all applications,
registrations, renewals and extensions thereof (collectively, “Marks”); (iii)
all Internet domain names; (iv) all copyrights and all mask work, database and
design rights, whether or not registered or published, all registrations and
recordations thereof and all applications in connection therewith, along with
all reversions, extensions and renewals thereof; (iv) all trade secrets; and
(v) all other intellectual property rights arising from or relating to
Technology.
     “Law” means any law, statute, regulation, ordinance, rule, Order,
settlement, Contract or governmental requirement enacted, promulgated, entered
into, or imposed by, any Governmental Authority (including, for the sake of
clarity, common law).
     “Legal Proceeding” means any judicial, administrative or arbitral actions,
suits, proceedings, hearings or investigations (in each case, whether public or
private and whether civil, criminal or administrative) by or before a
Governmental Authority.
     “Liability” means, collectively, any Indebtedness, guaranties,
endorsements, claims, losses, damages, deficiencies, costs, expenses, fines,
penalties, liabilities, obligations or responsibilities, whether fixed or
unfixed, known or unknown, choate or inchoate, liquidated or unliquidated,
secured or unsecured, direct or indirect, matured or unmatured, determinable or
indeterminable, absolute, contingent or otherwise, or in contract, tort, strict
liability or otherwise, including any product liability and any related costs
and expenses of any defense.
     “Lien” means any lien, encumbrance, pledge, mortgage, deed of trust,
security interest, claim, lease, charge, option, right of first refusal,
easement, servitude or transfer restriction.
     “Loss” and “Losses” have the meanings set forth in Section 8.1.

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     “Marketing Authorization” means any current marketing authorizations and
pending applications for marketing authorizations granted by a Governmental
Authority for the purpose of promoting, marketing, selling and distributing the
Product in, and importing the Product into, the Territory in accordance with
applicable Law.
     “Material Adverse Effect” means a material adverse effect on (a) the
Exploitation of the Product in the Territory or (b) the ability of Seller to
consummate the Transactions; provided, however, that none of the following
shall, by itself, constitute a “Material Adverse Effect”: (i) changes that are
the result of factors generally affecting the industries or markets in which the
Product is Exploited that do not disproportionately affect the Exploitation of
the Product as compared to other companies of similar size and scope that
operate in the same industry or business as Seller; (ii) except for purposes of
Section 4.3, any adverse change, effect or circumstance arising out of or
resulting from actions contemplated by the Parties in connection with this
Agreement or the pendency or announcement of the Transactions; (iii) changes in
Laws or GAAP as applied on a consistent basis or the interpretation thereof that
do not disproportionately affect the Exploitation of the Product as compared to
other companies of similar size and scope that operate in the same industry or
business as Seller; (iv) any action taken at the written request of Buyer;
(v) any legal or investment banking fees or expenses of Seller, incurred or made
in connection with the Transactions; (vi) any failure, in and of itself and
occurring prior to the Closing, of Seller to meet any projection or forecast
(including with respect to the Product); and (vii) changes that are the result
of economic factors affecting the national, regional or world economy or acts of
war or terrorism that do not disproportionately affect the Exploitation of the
Product as compared to other companies of similar size and scope that operate in
the same industry or business as Seller.
     “Necessary Buyer Consents” has the meaning set forth in Section 5.3(b).
     “Necessary Seller Consents” has the meaning set forth in Section 3.4(a)(v).
     “Noteholder Consent” means the consent executed by certain holders of
Convertible Senior Notes in form and substance reasonably acceptable to Buyer
and Seller.
     “Offerors” has the meaning set forth in Section 6.8(a).
     “Order” means any order, injunction, judgment, doctrine, decree, ruling,
writ, assessment, award or arbitration award of a Governmental Body.
     “Ordinary Course of Business” means the ordinary and usual course of normal
day-to-day operations relating to the Product in the Territory and the Purchased
Assets, as conducted by or on behalf of Seller, consistent in all material
respects with past practice.
     “Party” and “Parties” have the meanings set forth in the Preamble.
     “Patent Assignments” means short form Patent Assignment Agreements, each in
substantially the form of Exhibit E hereto.

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     “Patent Term Extension” means the extension of a patent term under 35
U.S.C. § 156.
     “Patents” has the meaning set forth in the definition of the term
“Intellectual Property.”
     “Permitted Transaction” means (a) any consolidation or merger of Seller
with or into any other Person, or any other corporate reorganization or
transaction (including the acquisition of capital stock of Seller), whether or
not Seller is a party thereto, in which the stockholders of Seller immediately
prior to such consolidation, merger, reorganization or transaction, own capital
stock either (i) representing directly, or indirectly through one or more
entities, less than fifty percent (50%) of the economic interests in, or voting
power of, Seller (or other surviving entity) immediately after such
consolidation, merger, reorganization or transaction or (ii) that does not
directly, or indirectly through one or more entities, have the power to elect a
majority of the entire board of directors of Seller (or other surviving entity)
immediately after such consolidation, merger, reorganization or transaction;
provided that (x) if within an Exclusive Negotiation Period, the ROFN Assets are
excluded from any such transaction and (y) Seller (or other surviving entity)
expressly acknowledges Buyer’s rights, and expressly reaffirms Seller’s (or
other surviving entity’s) obligations, under the post-Closing covenants set
forth in the Transaction Documents (including under Section 6.8 of this
Agreement); or (b) any sale, lease or other disposition of all or substantially
all of Seller’s assets other than, if within an Exclusive Negotiation Period,
the ROFN Assets.
     “Person” means an individual, a partnership, a corporation, a limited
liability company, an association, a joint stock company, a trust, a joint
venture, an unincorporated organization, any other business entity or a
Governmental Authority.
     “Pharmacovigilance Provider” means, (a) within the U.S. Territory, TMC
Pharma Services Ltd. (b) within Canada and Australia and outside the Territory
(i) prior to the transfer of the Marketing Authorization in the European Union
by Bayer to a third party, Bayer and (ii) thereafter, TMC Pharma Services Ltd.
     “Product” means the injectable intravascular magnetic resonance angiography
contrast agent currently known as Vasovist® (gadofosveset trisodium) and,
(a) with respect to the U.S. Territory, approved by the FDA pursuant to the
Vasovist NDA, (b) with respect to Canada, approved by Health Canada pursuant to
the Vasovist NDS and, (c) with respect to Australia, approved by the ATGA
pursuant to the Vasovist MAA.
     “Product Records” means all files, reports, books, records, documents and
similar materials (in each case, whether or not in electronic form) owned or
licensed by Seller (whether inside or outside of the Territory) and primarily
pertaining to (a) the Product in the Territory or the Purchased Assets or
(b) the Exploitation of the Product in the Territory, regulatory approval,
testing, clinical trialing, handling, processing, recordkeeping, storage,
warehousing, disposal, packaging, labeling, promotion, import or export of the
Product in the Territory (including copies of all ledgers, journals, operating
data and plans, technical documentation (including design specifications,
functional requirements, operating instructions, logic manuals, flow charts and
similar items), user documentation (including user manuals, training materials,
release notes,

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working papers and similar items), marketing studies and documentation
(including sales brochures, flyers, pamphlets, web pages and similar items),
customer and supplier lists, consultant reports, invention disclosures,
laboratory notebooks and records, physician databases, correspondence and other
materials, internal memoranda and notes relating to interactions with
Governmental Authorities, and all complaint files and adverse event files);
provided, however, that “Product Records” shall not include any books,
documents, records, files and similar materials (in each case, whether or not in
electronic form) (A) prepared in connection with the Transaction, (B) maintained
by Seller and/or its Representatives, agents or licensees in connection with
their respective ongoing Tax requirements or (C) primarily pertaining to the
Exploitation of the Product outside the Territory or any other business of
Seller.
     “Purchase Price” has the meaning set forth in Section 3.1.
     “Purchased Assets” has the meaning set forth in Section 2.1.
     “Receiving Party” has the meaning set forth in Section 10.1(a).
     “Representatives” means, with respect to any Person, the Affiliates,
directors, officers, employees, agents or advisors (including attorneys,
accountants, financial advisors and consultants) of such Person and
representatives of any of the foregoing; and, with respect to Buyer, the term
“Representatives” shall also include Buyer’s lenders and their respective
Representatives.
     “Required Payments” has the meaning set forth in Section 6.1(b).
     “ROFN Acquisition Transaction” has the meaning set forth in Section 6.8(b).
     “ROFN Assets” has the meaning set forth in Section 6.8(a).
     “ROFN Notice” has the meaning set forth in Section 6.8(b).
     “ROFN Period” has the meaning set forth in Section 6.8(f).
     “Scheduled Approvals” has the meaning set forth in Section 4.8(a).
     “SEC” means the Securities and Exchange Commission and any successor
Governmental Authority.
     “SEC Documents” has the meaning set forth in Section 4.15.
     “Seller” has the meaning set forth in the Preamble.
     “Seller FDA Letters” means the letter from Seller to the FDA, duly executed
by Seller, to be delivered to Buyer at the Closing, with regard to the Vasovist
NDA and MS-325 IND 51,172, the forms of which are attached hereto as Exhibits
F-1 and F-2, respectively.

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     “Seller’s Indemnified Persons” has the meaning set forth in Section 8.2.
     “Seller’s Knowledge” means the actual knowledge of those individuals set
forth on Schedule 1.1, after their due inquiry of the employees and/or
consultants of Seller materially involved with respect to the matter in
question.
     “Specified Contracts” has the meaning set forth in Section 2.1(e)(i).
     “Sublicensed Intellectual Property” has the meaning set forth in Section
6.3(c).
     “Subsidiary” means any Person of which (i) a majority of the outstanding
share capital, voting securities or other equity interests are owned, directly
or indirectly, by another Person or (ii) another Person is entitled, directly or
indirectly, to appoint a majority of the board of directors or managers or
comparable supervisory body of such Person.
     “Tax” or “Taxes” means any and all taxes, assessments, levies, tariffs,
duties or other charges or impositions in the nature of a tax imposed by any
Governmental Authority, including, without limitation, income, gross receipts,
license, payroll, employment, excise, severance, stamp, occupation, premium,
windfall profits, environmental, franchise, profits, withholding, social
security (or similar), unemployment, disability, real property, personal
property, sales, use, transfer, real property transfer, recording, registration,
value added, alternative or add-on minimum, estimated, or other tax of any kind
whatsoever (whether payable directly or by withholding and whether or not
requiring the filing of a Tax Return), including any interest or penalty thereon
or addition thereto and any interest in respect of such additions or penalties.
     “Tax Return” means any report, return (including any information return),
claim for refund, election, estimated Tax filing or payment, request for
extension, document, declaration or other information or filing supplied or
required to be supplied to any Governmental Authority with respect to Taxes.
     “Technology” means, collectively, all information, designs, formulae,
algorithms, procedures, methods, techniques, ideas, know-how, research and
development, technical data, programs, subroutines, tools, materials,
specifications, processes, inventions (whether patentable or unpatentable and
whether or not reduced to practice), apparatus, creations, improvements, works
of authorship and other similar materials, and all recordings, graphs, drawings,
reports, analyses, and other writings, and other tangible embodiments of the
foregoing, in any form whether or not specifically listed herein, and all
related technology, that are used in, incorporated in, embodied in, displayed by
or relate to, or are used in connection with the foregoing.
     “Termination Agreement” means the Termination Agreement, dated as of
April 6, 2009, by and among Bayer, TMC Pharma Services, Ltd. Seller and, with
respect to certain provisions, Buyer.
     “Territory” means the U.S. Territory, Canada and Australia.

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     “Total Consideration” has the meaning set forth in Section 3.1.
     “Transaction Documents” means this Agreement, the Bill of Sale, the
Assignment and Assumption Agreement, the Patent Assignment, the General IP
Assignment and the other documents, instruments, exhibits, annexes, schedules or
certificates contemplated hereby and thereby.
     “Transactions” means the transactions contemplated by the Transaction
Documents.
     “Transfer Taxes” has the meaning set forth in Section 9.2.
     “U.S. Territory” means the United States of America, including the states
thereof, the District of Columbia and the Commonwealth of Puerto Rico, but
excluding each of its other territories.
     “Vasovist Authorization” means each of (a) in the U.S. Territory, the
Vasovist NDA, (b) in Canada, the Vasovist NDS and (c) in Australia, the Vasovist
MAA.
     “Vasovist MAA” means the registration approvals (including ARTG Nos.
115,498, 115,546 and 115,547) granted by the ATGA for the manufacture,
importation, storage, promotion, sale or other distribution of the Product in
Australia, including any submissions, resubmissions, variations or supplements
thereto, and any official correspondence with or from the ATGA regarding such
approval, application, submissions, resubmissions, variations or supplements, as
of the Closing Date.
     “Vasovist NDA” means the investigational new drug application 51,172 and
the new drug application 21-711, including any submissions, resubmissions or
supplements thereto, and any official correspondence with the FDA regarding such
applications, submissions, resubmissions or supplements, as of the Closing Date.
     “Vasovist NDS” the new drug submission control number 096420, including any
submissions, resubmissions or supplements thereto, any official correspondence
with Health Canada regarding such application, submissions, resubmissions or
supplements, and the notice of compliance for Vasovist, as of the Closing Date.
     “Worldwide IP” means all Intellectual Property owned, used, held for use,
currently contemplated to be used, filed by or licensed to Seller or its
Subsidiaries and primarily pertaining to the Exploitation of the Product
anywhere in the world, including the Assigned Intellectual Property.
     1.2 Interpretation. References in this Agreement to any gender include
references to all genders, and references to the singular include references to
the plural and vice versa. The words “include,” “includes” and “including” when
used in this Agreement shall be deemed to be followed by the phrase “without
limitation.” Unless the context otherwise requires, references in this Agreement
to Articles, Sections, Exhibits and Schedules shall be deemed references to

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     Articles and Sections of, and Exhibits and Schedules to, this Agreement.
Unless the context otherwise requires, the words “hereof,” “hereby” and “herein”
and words of similar meaning when used in this Agreement refer to this Agreement
in its entirety and not to any particular Article, Section or provision of this
Agreement. The table of contents and headings contained in this Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. Any reference to any Law shall be deemed also
to refer to all rules and regulations promulgated thereunder, unless the context
requires otherwise.
ARTICLE II
PURCHASE AND SALE
OF ASSETS AND ASSUMPTION OF LIABILITIES
     2.1 Purchase and Sale of Assets. On the terms and subject to the conditions
set forth in this Agreement, at the Closing, for the Total Consideration, Seller
shall sell, transfer, assign, convey and deliver to Buyer (or its designated
Affiliate or Affiliates), and Buyer (or its designated Affiliate or Affiliates)
shall purchase, acquire and accept from Seller or its designee, all right, title
and interest in, to and under the Purchased Assets, free and clear of all Liens
(other than Liens pursuant to the terms of the Assigned Contracts (as defined
below)). The “Purchased Assets” shall mean all right, title and interest in and
to the following assets and rights owned or held by Seller as of the Closing:
          (a) (i) all Patents primarily pertaining to the Product in the
Territory owned by Seller, all of which are set forth on Schedule 2.1(a)(i); and
(ii) all trade secrets, know-how and copyrights owned by Seller and primarily
pertaining to the Product in the Territory (the Intellectual Property described
in clauses (i) and (ii) is referred to herein collectively as the “Assigned
Intellectual Property”);
          (b) all regulatory filings, drug master files and other regulatory
dossiers and Approvals primarily pertaining to the Product in the Territory
owned or licensed by Seller, all of which are set forth in Schedule 2.1(b);
          (c) all other preclinical and clinical data, information, results and
other materials to the extent primarily pertaining to the Product in the
Territory owned or licensed by Seller (including a copy of Seller’s magnetic
resonance image database in the Territory), all of which are described on
Schedule 2.1(c);
          (d) all Product Records; provided that Seller shall be entitled to
retain (subject to Article X) a copy of all Product Records;
          (e) other than Contracts listed on Schedule 2.2(g), (i) those
Contracts to which Seller is a party primarily pertaining to the Product in the
Territory or any of the Purchased Assets set forth on Schedule 2.1(e)(i) (the
“Specified Contracts”) and (ii) the benefit of all non-disclosure,
confidentiality, standstill, non-compete and non-solicitation agreements or
obligations and invention assignment obligations of all current and former
employees,

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consultants and agents of Seller or third parties pursuant to Contracts between
such persons and Seller, in each case, to the extent relating to the Product in
the Territory or any of the Purchased Assets or any portion of any of the
foregoing, all of which are set forth on Schedule 2.1(e)(ii) (the “Assigned
Contract Rights”) (the Specified Contracts and the Assigned Contract Rights are
referred to collectively as the “Assigned Contracts”); and
          (f) all claims, credits, causes of action and other rights of Seller
against third parties in respect of (i) the Purchased Assets described in
clauses (a) through (e) above or (ii) the Assumed Liabilities, including those
set forth on Schedule 2.1(f).
     2.2 Excluded Assets. The Parties acknowledge and agree that Seller shall
not convey, transfer, deliver or assign to Buyer, and Buyer shall not purchase,
take delivery of, or acquire, any rights to any assets, properties, interests or
rights of Seller other than the Purchased Assets specifically enumerated in
Section 2.1 (collectively the “Excluded Assets”), including all of the rights,
title and interests of Seller and its Subsidiaries and Affiliates in the
following:
          (a) all rights pertaining to products, services, business and
prospects of Seller and its Subsidiaries, other than, or with respect to, the
Purchased Assets;
          (b) all rights of Seller to the extent relating to the Product outside
the Territory (except, for the avoidance of doubt, as expressly set forth in
Section 6.8);
          (c) all Seller’s employees;
          (d) all claims, credits, causes of action and other rights of Seller
against third parties pertaining to any Excluded Asset;
          (e) the retained copies of the Product Records and Seller’s magnetic
resonance image database;
          (f) any and all Tax assets of Seller and its Subsidiaries, including,
without limitation, any Tax claims or rights to Tax refunds, other than Tax
claims or rights to Tax refunds in respect of Taxes for which Buyer is liable
pursuant to Section 2.4 or Section 9.2 hereof;
          (g) those Contracts to which Seller is a party primarily pertaining to
the Product in the Territory or any of the Purchased Assets set forth on
Schedule 2.2(g); and
          (h) all rights of Seller under this Agreement or any of the
Transaction Documents.
     2.3 Assumption of Liabilities.
          (a) On the terms and subject to the conditions set forth in this
Agreement, at the Closing, Buyer shall (or shall cause its designated Affiliate
or Affiliates to) assume, effective

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as of the Closing, and shall, from and after the Closing, perform, satisfy and
discharge only the following Liabilities of Seller (collectively, the “Assumed
Liabilities”):
     (i) subject to Section 2.3(b)(ii), all Liabilities of Seller under the
Specified Contracts and Approvals arising out of, or relating to, the Product in
the Territory, but only to the extent relating to the period from and after the
Closing; and
     (ii) subject to Section 2.3(b)(iii), all Liabilities arising out of,
relating to, or otherwise in respect of the Purchased Assets from and after the
Closing.
          (b) Buyer will not assume or be liable for any Excluded Liabilities
(as defined below). Seller shall retain, be responsible for, perform, satisfy
and discharge all Excluded Liabilities in all respects. “Excluded Liabilities”
shall mean all Liabilities of Seller other than the Assumed Liabilities,
including all of the following Liabilities:
     (i) all Liabilities arising out of, relating to, or otherwise in respect
of, (A) the Purchased Assets or the Product in respect of the period before the
Closing, (B) Seller’s business, assets and operations outside of the Territory
or (C) the Product outside of the Territory;
     (ii) all Liabilities under the Assigned Contracts and Approvals in respect
of the Exploitation of the Product by the Seller during the period before the
Closing, including the Required Payments;
     (iii) all Liabilities incurred as a result of any Legal Proceedings
(regardless of when asserted or initiated) to the extent that such Legal
Proceeding arises out of, or relates to, (A) any action, omission, occurrence,
event, circumstance, or condition relating to the Product, the Exploitation or
the ownership or operation of the Purchased Assets that occurred or existed at
or before the Closing (whether asserted before, at or after the Closing) or (B)
Seller’s business, assets and operations, the Product or the Purchased Assets to
the extent the basis for which arose out of, or related to, any actions or
omissions that occurred outside of the Territory;
     (iv) all Taxes of Seller and its Subsidiaries for any period, including (x)
any Taxes for which Seller or any of its Subsidiaries may be liable under
Treasury Regulations Section 1.1502-6 or any similar provision of state, local
or foreign law, or as transferee or successor, by Contract or otherwise, (y) all
Taxes relating to the Excluded Assets or Excluded Liabilities for any period and
(z) all Taxes relating to the Purchased Assets or the Assumed Liabilities for
any taxable period prior to the Closing Date and, with respect to any taxable
period beginning before and ending after the Closing Date, for the portion of
such taxable period ending on the Closing Date, other than any Transfer Taxes as
set forth in Section 9.2 hereof; and

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     (v) all Liabilities arising out of, relating to, or otherwise in respect
of, the Excluded Assets.
     2.4 Prorations. Seller and Buyer agree that all of the items listed below
relating to the Purchased Assets will be prorated as of the Closing Date, with
Seller liable to the extent such items relate to any time period up to and
including the Closing Date and Buyer liable to the extent such items relate to
periods subsequent to the Closing Date: (a) property, ad valorem and other
similar Taxes, if any, attributable to the Purchased Assets; and (b) the amount
of any license or registration fees with respect to any Approvals which are
being assigned or transferred hereunder. Each of Seller and Buyer agrees to
furnish the other Party with such documents and other records as such other
Party reasonably requests in order to confirm all adjustment and proration
calculations made pursuant to this Section 2.4. Seller shall promptly forward to
Buyer all invoices relating to the Purchased Assets that Seller receives. Buyer
shall pay the full amount of all such invoices and any other invoices received
by it and shall submit a request for reimbursement to Seller for Seller’s share
of such expenses. Seller shall promptly reimburse Buyer for Seller’s share of
such expenses.
ARTICLE III
PAYMENT; CLOSING
     3.1 Payment. The aggregate consideration for the Purchased Assets shall be
(a) an amount in cash equal to $28,000,000 (the “Purchase Price”) and (b) the
assumption of the Assumed Liabilities (together with the Purchase Price, the
“Total Consideration”).
     3.2 Payment Method. On the Closing Date, Buyer shall pay the Purchase Price
to, or on behalf of, Seller by wire transfer of immediately available funds into
the accounts designated by Seller in writing not fewer than one Business Day
before the Closing Date.
     3.3 The Closing. The consummation of the purchase and sale of the Purchased
Assets and the assumption of the Assumed Liabilities provided for in Article II
hereof (the “Closing”) shall take place at the offices of Weil, Gotshal & Manges
LLP located at 100 Federal Street, 34th Floor, Boston, MA 02110 (or at such
other place as the parties may designate in writing) at 10:00 a.m. (Boston time)
on the date hereof unless another time, date or place is agreed to in writing by
the Parties (the date on which the Closing occurs is referred to herein as the
“Closing Date”).
     3.4 Closing Deliveries.
     (a) Deliveries by Seller. At the Closing, Seller shall deliver or cause to
be delivered to Buyer the following:
     (i) a certificate duly executed by Seller’s Chief Executive Officer or
Chief Financial Officer, in a form and substance reasonably satisfactory to
Buyer, dated as of the Closing Date, to the effect that each of the conditions
specified in Sections 7.1(a) and 7.1(b) has been satisfied in all respects;

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     (ii) (A) a duly executed Bill of Sale; (B) a duly executed Assignment and
Assumption Agreement; (C) duly executed Patent Assignments; and (D) a duly
executed General IP Assignment;
     (iii) a copy of the executed Seller FDA Letters and a copy of each Vasovist
Authorization;
     (iv) all instruments and documents necessary to release any and all Liens
on the Purchased Assets, including appropriate UCC financing statement
amendments (termination statements);
     (v) evidence reasonably satisfactory to Buyer that the consents listed on
Schedule 3.4(a)(v) (the “Necessary Seller Consents”) have been obtained;
     (vi) evidence that Seller has made, or has caused to be made, all Required
Payments;
     (vii) an affidavit of non-foreign status of Seller that complies with
Section 1445 of the Code;
     (viii) a copy of the executed Noteholder Consent; and
     (ix) all other documents as Buyer may reasonably request, including
secretary’s certificates, evidence of corporate existence and good standing,
evidence of corporate approvals and other similar documents.
     (b) Deliveries by Buyer. At the Closing, Buyer shall deliver to Seller the
following:
     (i) a certificate duly executed by Buyer’s Chief Executive Officer or Chief
Financial Officer, in a form and substance reasonably satisfactory to Seller,
dated as of the Closing Date, to the effect that each of the conditions
specified in Sections 7.2(a) and 7.2(b) has been satisfied in all respects;
     (ii) a duly executed Assignment and Assumption Agreement;
     (iii) evidence reasonably satisfactory to Seller that the Necessary Buyer
Consents have been obtained;
     (iv) a copy of the executed Buyer FDA Letters;
     (v) evidence of wire transfer(s) of the Purchase Price referred to in
Section 3.2; and

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     (vi) all other documents as Seller may reasonably request, including
secretary’s certificates, evidence of corporate existence and good standing,
evidence of corporate approvals and other similar documents.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF SELLER
     Seller represents and warrants to Buyer as follows as of the Execution Date
and as of the Closing Date:
     4.1 Organization and Corporate Power. Seller is a corporation duly
organized, validly existing and in good standing under the Laws of the State of
Delaware. Seller has the requisite corporate power and authority to own, operate
or lease the properties that it purports to own, operate or lease and to carry
on its business as it is now being conducted and is duly licensed or qualified
to do business in each jurisdiction in which the nature of the business
conducted by it or the character or location of the properties owned or leased
by it makes such licensing or qualification necessary, except where the failure
to be so licensed or qualified would not have, or would not be reasonably
expected to have, a Material Adverse Effect.
     4.2 Due Authorization. Seller has the requisite corporate power and
authority to execute and deliver the Transaction Documents and to consummate the
Transactions. The execution, delivery and performance by Seller of the
Transaction Documents and the consummation by Seller of the Transactions have
been duly authorized by all necessary corporate action on the part of Seller,
and no other corporate proceeding is necessary for the execution and delivery of
the Transaction Documents by Seller the performance by Seller of its obligations
thereunder and the consummation by Seller of the Transactions. This Agreement
has been duly executed and delivered by Seller and constitutes the legal, valid
and binding obligation of Seller, enforceable against Seller in accordance with
its terms, except as the same may be limited by bankruptcy, insolvency,
moratorium, reorganization or other Laws of general applicability relating to or
affecting the enforcement of creditor’s rights and general principles of equity.
When executed and delivered in accordance herewith, the other Transaction
Documents will have been duly executed and delivered by Seller and will
constitute legal, valid and binding obligations of Seller enforceable against
Seller in accordance with their respective terms, except as the same may be
limited by bankruptcy, insolvency, moratorium, reorganization or other Laws of
general applicability relating to or affecting the enforcement of creditor’s
rights and general principles of equity.
     4.3 No Violation; Consents.
          (a) The execution, delivery and performance by Seller of the
Transaction Documents do not and will not: (i) violate any material Law or Order
applicable to Seller or any of its properties or assets (including the Purchased
Assets); (ii) violate or conflict with, result in a breach of, constitute a
default (or an event which, with or without notice or lapse of time or both,
would constitute a default) under, permit cancellation of, or result in the
creation of any Lien

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upon any of Seller’s properties or assets (including the Purchased Assets)
under, any material Contract to which Seller is a party or by which it or its
properties and assets are bound (including the Indenture, the Convertible Senior
Notes and the Assigned Contracts); or (iii) violate or conflict with any
provision of Seller’s certificate of incorporation and by-laws.
          (b) Except for the approvals, notices and consents of, and filings
with, the Governmental Authorities or other Persons not a party to this
Agreement set forth on Schedule 4.3(b), no consents, notices or approvals of, or
filings or registrations by Seller with, any Governmental Authority or any other
Person not a party to this Agreement are necessary in connection with the
execution, delivery and performance of the Transaction Documents or the
Transactions or the continuing validity and effectiveness immediately following
the Closing of any Assigned Contracts or Approvals.
     4.4 Intellectual Property.
          (a) Seller owns, or licenses pursuant to the Specified Contracts set
forth on Schedule 2.1(e)(i), free and clear of all Liens (other than Liens
pursuant to the terms of the Assigned Contracts), all Intellectual Property
used, held for use or contemplated for use by Seller or its Subsidiaries with
respect to the Exploitation of the Product in the Territory in the approved
formulations and indications set forth in the applicable Vasovist Authorization,
and the consummation of the Transactions will not conflict with, alter or impair
any such rights in any material respect.
          (b) Schedule 4.4(b) contains a complete and accurate list of the
following Worldwide IP used or held for use in the Exploitation of the Product:
(i) all issued, registered and applications to register Intellectual Property,
(ii) all material unregistered trademarks, and (iii) all Contracts granting any
licenses, options or other rights to any Intellectual Property. For each item
listed on such Schedule, Schedule 4.4(b) sets forth (A) the owner, (B) the
jurisdiction where issued, registered, legally sanctioned, filed or the
equivalent and (C) to the extent such Intellectual Property is owned by Seller,
the particulars of any registrations or issuances including, without limitation,
all relevant dates, inventors’ names, application numbers and the status
thereof.
          (c) Schedule 4.4(c) lists all royalties payable to any third party
with respect to the Exploitation of the Product in the Territory or the use of
any of the Assigned Intellectual Property and Sublicensed Intellectual Property
as of the Closing (whether or not payable before, at or after the Closing).
Except as set forth on Schedule 4.4(c), (i) there is no restriction or
limitation on Seller’s right to transfer any Assigned Intellectual Property and
Sublicensed Intellectual Property to Buyer, as herein contemplated, and
(ii) neither Seller nor any of its Subsidiaries has licensed any third party to
use any of the Assigned Intellectual Property and Sublicensed Intellectual
Property.
          (d) All Assigned Intellectual Property and Sublicensed Intellectual
Property is valid and subsisting and to Seller’s Knowledge enforceable, and all
necessary registration, prosecution, maintenance, renewal, and other relevant
filing fees due in connection therewith

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have been timely paid and all necessary actions (including the filing of
documents and certificates in connection therewith) have been timely taken with
the relevant authorities for the purposes of prosecuting and/or maintaining such
Intellectual Property in full force and effect. Except as set forth on
Schedule 4.4(d), as of the date of this Agreement, there are no filings,
payments or similar actions that must be taken within ninety (90) days following
the date hereof for the purposes of obtaining, maintaining, perfecting or
renewing any registrations and applications to such Intellectual Property.
          (e) To Seller’s Knowledge, none of the use of Assigned Intellectual
Property and Sublicensed Intellectual Property by Seller or its Affiliates in
the Exploitation of the Product in the Territory in the approved formulations
and indications set forth in the applicable Vasovist Authorization, or the
Exploitation of the Product in the Territory in the approved formulations and
indications set forth in the applicable Vasovist Authorization, infringes,
misappropriates, otherwise violates or is in conflict with the rights of others
or the rights granted to Seller under any applicable Laws, and, to Seller’s
Knowledge, there is no basis for any such claim or demand. No Legal Proceeding
is pending or, to Seller’s Knowledge, threatened or asserted in writing, against
Seller or any of its Subsidiaries by any person before any Governmental
Authority (including the U.S. Patent and Trademark Office or equivalent
authority anywhere in the world) with respect to (i) the ownership, validity,
enforceability, effectiveness or use of any Assigned Intellectual Property and
Sublicensed Intellectual Property, or (ii) allegations of any infringement,
misappropriation, or other violation or conflict (including under any unfair
competition or trade practices claim) related to the Product in the Territory or
the Exploitation of the Product in the Territory, in each case, in the approved
formulations and indications set forth in the applicable Vasovist Authorization.
          (f) To Seller’s Knowledge, no Person is infringing upon or otherwise
violating any of the Assigned Intellectual Property and Sublicensed Intellectual
Property. Neither Seller nor any of its Subsidiaries has brought or asserted any
Legal Proceeding against any person for infringing, misappropriating or
otherwise violating any Assigned Intellectual Property and Sublicensed
Intellectual Property, and, to Seller’s Knowledge, there is no basis for any
such Legal Proceeding.
          (g) Except as would not and would not reasonably be expected to
materially impair (i) the Exploitation of the Product in the Territory in the
approved formulations and indications set forth in the applicable Vasovist
Authorization or (ii) the Purchased Assets, all confidential Assigned
Intellectual Property and Sublicensed Intellectual Property and other
confidential and proprietary information and Technology of Seller to the extent
relating to the Exploitation of the Product in the Territory in the approved
formulations and indications set forth in the applicable Vasovist Authorization
or included in the Purchased Assets has been maintained in confidence in
accordance with Seller’s customary protection procedures, which are reasonably
adequate and in accordance with industry standards, and Seller has executed
written confidentiality and invention assignment agreements in a form provided
to Buyer with all past and present employees, consultants and independent
contractors who have materially contributed to or been retained in connection
with the development of the Assigned Intellectual Property

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pursuant to which such employees, consultants and independent contractors have
assigned to Seller all their rights in and to all Assigned Intellectual Property
they developed in the course of their employment or retention.
     4.5 Litigation and Claims.
          (a) There is no Legal Proceeding (whether in or outside the Territory)
pending or, to Seller’s Knowledge, threatened or asserted in writing, against or
affecting (i) Seller that would prohibit or materially hinder, delay or
otherwise impair Seller’s ability to perform its obligations under the
Transaction Documents, including the assignment of the Purchased Assets, that
would affect the legality, validity or enforceability of the Transaction
Documents, or that would prevent or materially delay the consummation of the
Transactions, (ii) the Exploitation of the Product (whether in or outside the
Territory), (iii) the Product (whether in or outside the Territory) or (iv) the
Purchased Assets.
          (b) None of Seller, any of its Subsidiaries or, to the Knowledge of
Seller, any of their respective Affiliates, directors, officers, agents or
employees is subject to any Order (whether in or outside the Territory) that is
related to the Exploitation of the Product (whether in or outside the
Territory), the Product (whether in or outside the Territory) or the Purchased
Assets.
          (c) Seller has paid to Covidien and any of its Affiliates all
Liabilities due and payable or otherwise accrued before, or in connection with,
the Closing and/or the Transactions under the Amended and Restated Strategic
Collaboration Agreement between Seller and Covidien, dated as of June 9, 2000,
as amended to date, in full satisfaction of all Liabilities owed or accrued
thereunder.
     4.6 Good and Valid Title. Except as set forth on Schedule 4.6, Seller has,
or as of the Closing Date will have the right to acquire and transfer to Buyer,
good and valid title to the Purchased Assets, in each case free and clear of all
Liens (other than Liens pursuant to the terms of the Assigned Contracts).
     4.7 Assigned Contracts. Except as set forth on Schedule 4.7, the Assigned
Contracts represent all Contracts of Seller or any of its Affiliates to the
extent relating to the Product in the Territory or the Purchased Assets,
including all Contracts (a) to the extent relating to the acquisition, use,
transfer, development or sharing of, or granting any license, option or other
rights to, the Assigned Intellectual Property (including any license or other
Contract under which Seller is a licensee or licensor of any such Assigned
Intellectual Property) and Sublicensed Intellectual Property, (b) to the extent
relating to the joint development of, or any strategic alliance, partnership or
sharing of profits or proprietary information with respect to, the Product in
the Territory or the Assigned Intellectual Property and Sublicensed Intellectual
Property, (c) containing any covenants restricting or prohibiting the owner and
operator of the Purchased Assets from competing in any line of business or in
any geographical area or from soliciting or hiring any Person, or any covenants
of another Person restricting or prohibiting such Person from doing any of the
foregoing, (d) restricting any use of the Purchased Assets, (e) to the extent

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relating to the Exploitation of the Product in the Territory and (f) providing
for royalties on the sale of the Product in the Territory (whether payable
before, at or after Closing). Seller has provided Buyer with true and complete
copies of each Assigned Contract, including all amendments, supplements and
modifications to each such Assigned Contract. All of the Assigned Contracts are
the valid, binding obligations of Seller, enforceable by and against Seller in
accordance with their respective terms, except as the same may be limited by
bankruptcy, insolvency, moratorium, reorganization or other Laws of general
applicability relating to or affecting the enforcement of creditor’s rights and
general principles of equity. Neither Seller nor, to Seller’s Knowledge, any
other party thereto is in breach or default under any provision of any Assigned
Contract.
     4.8 Approvals; Compliance with Laws.
          (a) Schedule 4.8(a)(i) hereto sets forth a true and complete list of
all Approvals held by Seller (the “Scheduled Approvals”). Seller validly holds,
possesses or has rights to, the Scheduled Approvals, and all Scheduled Approvals
are in full force and effect, except as would not and would not reasonably be
expected to materially impair the Product in the Territory or the Purchased
Assets. Except as set forth in Schedule 4.8(a)(ii), the Scheduled Approvals
constitute all Approvals necessary and sufficient for the Exploitation of the
Product in the Territory in the approved formulations and indications set forth
in the applicable Vasovist Authorization and the testing, processing,
recordkeeping, storage, disposal, packaging, labeling, promotion, import or
export of the Product in the Territory in the approved formulations and
indications set forth in the applicable Vasovist Authorization (excluding any
clinical research that Buyer may initiate). Seller has complied in all material
respects with all of the terms and conditions of the Scheduled Approvals, except
the post-market requirements pursuant to Section 505(o) of FFDCA. Seller has not
received any formal or informal written notice of material noncompliance with
any Scheduled Approvals or that any Governmental Authority is considering any
Legal Proceeding to limit, revoke, suspend or modify any Scheduled Approval. The
consummation of the Transactions will not cause the limitation, suspension,
revocation or cancellation of any Scheduled Approval.
          (b) Seller has complied, and is in compliance, in all material
respects with those Laws (including the FFDCA and Environmental Laws) applicable
to (x) the Exploitation of the Product in the Territory or the testing,
handling, processing, recordkeeping, storage, warehousing, disposal, packaging,
labeling, promotion, import or export of the Product in the Territory or (y) the
Purchased Assets. Seller has not received written notice of material
noncompliance with any such Laws. Not in limitation of the foregoing:
     (i) All studies, tests and preclinical and clinical trials relating to the
Product conducted by or on behalf of Seller are being (or if completed, have
been) conducted in material compliance with experimental protocols, procedures
and controls pursuant to applicable Laws, including, but not limited to, the
FFDCA and its implementing regulations at 21 C.F.R. Parts 50, 54, 56 and 312 and
any applicable Australian Drug Law or Canadian Drug Law. The clinical trials
listed in Schedule 4.8(b)(i) are the only clinical trials conducted by Seller in
relation to

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the Product in the Territory, and all such trials have been fully completed.
Seller has not received any written notices, correspondence or other
communication from the FDA or other Governmental Authority requiring the
termination, suspension or material modification of any study, test or clinical
or preclinical trial relating to the Product currently being conducted by it or
on its behalf.
     (ii) All reports, documents, claims, notices or Approvals required to be
filed, obtained, maintained or furnished to any Governmental Authority by Seller
with respect to the Product in the Territory or the Purchased Assets have been
so filed, obtained, maintained or furnished. There are no outstanding requests
for information or requisitions from any Governmental Authority relating to the
Product in the Territory. All information submitted by Seller to any
Governmental Authority with respect to the reports, documents, claims or notices
or for the purpose of seeking Approvals has, to Seller’s Knowledge, been true,
accurate and complete in all material respects.
     (iii) Seller (A) is not a party to a corporate integrity agreement, consent
order, warning letter or FDA Form 483, (B) has no reporting obligations pursuant
to a settlement agreement, plan of correction or other remedial measure entered
into with any Governmental Authority, and (C) has not been served with or
received any search warrant, subpoena, civil investigative demand or contact
letter from any Governmental Authority related to the Product or the Purchased
Assets (whether in or outside the Territory).
     (iv) Seller has disclosed to Buyer all regulatory reports required to be
filed with the FDA, and all written correspondence from the FDA, in each case,
solely with respect to the Product in the U.S. Territory.
          (c) No transfer of property is being made, and no obligation is being
incurred, in connection with the Transactions with the intent to hinder, delay
or defraud either present or future creditors of Seller or any of its
Subsidiaries. Seller acknowledges that it is selling the Purchased Assets to
Buyer in exchange for reasonably “equivalent value,” as such term or similar
terms are used in any potentially applicable fraudulent conveyance Laws.
          (d) To Seller’s Knowledge, other than with respect to the supply of
the Product as required under the clinical trials listed in Schedule 4.8(b)(i),
no Product has been imported into or sold in Australia.
          (e) To Seller’s Knowledge, except as set forth on Schedule 4.8(e), all
fees relating to the Approval of the Product in the Territory have been paid.
     4.9 Sufficiency of Assets and Rights. Except for the rights and assets set
forth on Schedule 4.9, the Purchased Assets, together with the rights granted to
Buyer under the Transaction Documents, constitute (a) all of the assets and
rights of Seller primarily pertaining to the Product in the Territory, (b) all
of the assets and rights necessary for the Exploitation of the

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Product in the Territory in the approved formulations and indications set forth
in the applicable Vasovist Authorization in all material respects as conducted
by Seller on the Execution Date and the Closing Date, and (c) all of the assets
and rights necessary for the further Exploitation of the Product in the
Territory in the approved formulations and indications set forth in the
applicable Vasovist Authorization.
     4.10 Tax Matters.
          (a) Except as would not have, or would not reasonably be expected to
have a Material Adverse Effect, Seller (i) has filed (or caused to be filed)
with the appropriate taxing authorities all Tax Returns relating to the
Purchased Assets required to be filed, and (ii) has paid (or caused to be paid)
all Taxes relating to the Purchased Assets required to be paid on or prior to
the Closing Date.
          (b) Seller is not a “foreign person” within the meaning of
Section 1445 of the Code.
     4.11 Absence of Certain Changes. Since December 31, 2008:
          (a) there has not occurred any events, occurrences or developments
that have had, or would reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect;
          (b) Seller has, directly or indirectly, conducted the Exploitation of
the Product in the Territory and otherwise operated the Purchased Assets in the
Ordinary Course of Business and has not:
     (i) transferred, sold, conveyed, leased or otherwise disposed of, or
transferred or granted any license, sublicense, rights or options in or to, any
of the Purchased Assets;
     (ii) mortgaged, pledged or subjected to any Lien, any of the Purchased
Assets;
     (iii) amended or waived any material right under any of the Assigned
Contracts;
     (iv) failed to exercise any rights of renewal with respect to any Assigned
Contract or Approval that, by its terms, would otherwise expire prior to the
Closing Date;
     (v) settled or compromised any claims relating to the Product in the
Territory or the Purchased Assets; and
     (vi) agreed to do anything described in clauses (i) — (v) above.

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     4.12 Broker’s Fees. Seller has not employed any broker, finder or
investment banker, or incurred any Liability for any brokerage, finder’s or
other fee or commission, in connection with the Transactions (other than such
fees or commissions for which Seller is solely responsible).
     4.13 Insurance. Seller has in full force and effect insurance policies in
such amounts, with such deductibles and against such risks and losses as are
customary for other companies of similar size and scope that operate in the same
industry or business as Seller.
     4.14 Affiliate Transactions. There are no Contracts or Liabilities between
Seller, on the one hand, and any Affiliate of Seller, on the other hand, that
are included in the Purchased Assets or the Assumed Liabilities or by which the
Purchased Assets are bound.
     4.15 Public Disclosures. Seller has filed with the SEC all forms, reports,
schedules, statements, exhibits and other documents required to be filed by
Seller subsequent to December 31, 2008 under the Exchange Act of 1934, as
amended (the “Exchange Act”) (collectively, the “SEC Documents”). As of its
filing date or, if amended, as of the date of the last such amendment, each SEC
Document complied in all material respects with the applicable requirements of
the Exchange Act and the applicable rules and regulations of the SEC thereunder.
As of its filing date, or, if amended, as of the date of the last such
amendment, each SEC Document did not contain any untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements made therein, in light of the circumstances under which they were
made, not misleading. All of the audited consolidated financial statements and
unaudited consolidated interim financial statements included in the SEC
Documents (i) have been prepared from, are in accordance with and accurately
reflect in all material respects the books and records of Seller and its
consolidated Subsidiaries, (ii) comply in all material respects with the
applicable accounting requirements and with the published rules and regulations
of the SEC with respect thereto (including Regulation S-X), (iii) were prepared
in accordance with GAAP applied on a consistent basis during the periods
involved except as may be indicated in the notes thereto and except, in the case
of the unaudited interim statements, as may be permitted under the Exchange Act
with respect to Quarterly Reports on Form 10-Q) and (iv) fairly present, in all
material respects, the consolidated financial position and the consolidated
results of operations and cash flows (subject, in the case of unaudited interim
financial statements, to normal year-end adjustments) of Seller and its
consolidated Subsidiaries as of the dates and for the periods referred to
therein. The reports of Seller’s independent auditors regarding Seller’s
consolidated financial statements in the SEC filings have not been withdrawn,
supplemented or modified, and none of Seller or any of its Subsidiaries has
received any written communication from its independent auditors threatening any
such withdrawal, supplement or modification.
     4.16 Disclaimer of Other Representations.
          (a) SELLER HAS NOT MADE ANY REPRESENTATIONS OR WARRANTIES, EXPRESS OR
IMPLIED, OF ANY NATURE WHATSOEVER RELATING TO SELLER OR ANY OF ITS SUBSIDIARIES
OR AFFILIATES OR THE BUSINESS OF

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SELLER OR ANY OF ITS SUBSIDIARIES OR AFFILIATES OR OTHERWISE IN CONNECTION WITH
THE TRANSACTIONS, OTHER THAN THOSE REPRESENTATIONS AND WARRANTIES EXPRESSLY SET
FORTH IN THIS ARTICLE IV.
          (b) Without limiting the generality of clause (a) above, except as
expressly set forth in this ARTICLE IV, neither Seller nor any of its
Representatives has made, and shall not be deemed to have made, any
representations or warranties in the materials relating to the business of
Seller and its Subsidiaries made available to Buyer and its Representatives,
including due diligence materials, or in any presentation of the business of
Seller and its Subsidiaries by management of Seller or others in connection with
the Transactions, and no statement contained in any of such materials or made in
any such presentation shall be deemed a representation or warranty hereunder or
otherwise or deemed to be relied upon by Buyer in executing, delivering and
performing this Agreement and the Transactions. Except as expressly set forth in
this ARTICLE IV, it is understood that any cost estimates, projections or other
predictions, any data, any financial information or any memoranda or offering
materials or presentations are not and shall not be deemed to be or to include
representations or warranties of Seller, and are not and shall not be deemed to
be relied upon by Buyer in executing, delivering and performing this Agreement
and the Transactions.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF BUYER
     Buyer represents and warrants to Seller as follows as of the Execution Date
and as of the Closing Date:
     5.1 Organization and Corporate Power. Buyer is a corporation duly
organized, validly existing and in good standing under the Laws of the State of
Delaware. Buyer has the requisite corporate power and authority to own, operate
or lease the properties that it purports to own, operate or lease and to carry
on its business as it is now being conducted and is duly licensed or qualified
to do business in each jurisdiction in which the nature of the business
conducted by it or the character or location of the properties owned or leased
by it makes such licensing or qualification necessary, except where the failure
to be so licensed or qualified would not have, or would not reasonably be
expected to have, a material adverse effect on Buyer’s ability to consummate the
Transactions.
     5.2 Due Authorization. Buyer has the requisite corporate power and
authority to execute and deliver the Transaction Documents and to consummate the
Transactions. The execution, delivery and performance by Buyer of the
Transaction Documents and the consummation by Buyer of the Transactions have
been duly authorized by all necessary corporate action on the part of Buyer and
no other corporate proceeding is necessary for the execution and delivery of the
Transaction Documents by Buyer, the performance by Buyer of its obligations
thereunder and the consummation by Buyer of the Transactions. This Agreement has
been duly executed and delivered by Buyer and constitutes the legal, valid and
binding

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obligation of Buyer, enforceable against Buyer in accordance with its terms,
except as the same may be limited by bankruptcy, insolvency, moratorium,
reorganization or other Laws of general applicability relating to or affecting
the enforcement of creditor’s rights and general principles of equity. When
executed and delivered in accordance herewith, the other Transaction Documents
will have been duly executed and delivered by Buyer and will constitute legal,
valid and binding obligations of Buyer, enforceable against Buyer in accordance
with their respective terms, except as the same may be limited by bankruptcy,
insolvency, moratorium, reorganization or other Laws of general applicability
relating to or affecting the enforcement of creditor’s rights and general
principles of equity.
     5.3 No Violation; Consents.
          (a) The execution, delivery and performance by Buyer of the
Transaction Documents do not and will not: (i) violate any material Law or Order
applicable to Buyer or any of its properties or assets; (ii) violate or conflict
with, result in a breach of, constitute a default (or an event which, with or
without notice or lapse of time or both, would constitute a default) under,
permit cancellation of, or result in the creation of any Lien upon any of
Buyer’s properties or assets including the Purchased Assets (other than any Lien
imposed by Buyer’s lenders under its existing credit facilities, as may be
amended from time to time) under, any material Contract to which Buyer is a
party or by which it or its properties and assets are bound; or (iii) violate or
conflict with any provision of the certificate of incorporation and by-laws or
comparable organizational documents of Buyer.
          (b) Except for the approvals, notices and consents of, and filings
with, Governmental Authorities or other Persons not a party to this Agreement
set forth on Schedule 5.3(b) (collectively, the “Necessary Buyer Consents”), no
consents, notices or approvals of, or filings or registrations by Buyer with,
any Governmental Authority or any other Person not a party to this Agreement are
necessary in connection with the execution, delivery and performance of the
Transaction Documents or the Transactions.
     5.4 Litigation. There is no Legal Proceeding pending or, to Buyer’s
knowledge, threatened or asserted in writing, against or affecting Buyer that
would prohibit or materially hinder, delay or otherwise impair Buyer’s ability
to perform its obligations under this Agreement or under the Transaction
Documents, including the assumption of the Assumed Liabilities, that would
affect the legality, validity or enforceability of this Agreement or the
Transaction Documents, or that would prevent or materially delay the
consummation of the Transactions.
     5.5 Financial Capability. Buyer has, and at the Closing will have,
sufficient unrestricted internal funds available and on hand to pay the Purchase
Price and any expenses incurred by Buyer in connection with the Transactions.
     5.6 Inspection; No Other Representations. Buyer is an informed and
sophisticated Person, and has engaged expert advisors experienced in the
evaluation and acquisition of assets such as the Purchased Assets as
contemplated hereunder. Buyer acknowledges that, except as expressly set forth
in ARTICLE IV, (a) Seller does not make any representation or warranty with

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respect to (i) any projections, estimates or budgets delivered to or made
available to Buyer or (ii) any other information or documents made available to
Buyer or its Representatives with respect to the Purchased Assets or Seller, its
Subsidiaries and Affiliates and their respective businesses and (b) Buyer has
not relied and will not rely upon any of the information described in subclauses
(i) and (ii) of clause (a) above or any other information, representation or
warranty except those representations and warranties set forth in ARTICLE IV
hereof in executing, delivering and performing this Agreement and the
Transactions.
     5.7 Broker’s Fees. Buyer has not employed any broker, finder or investment
banker, or incurred any Liability for any brokerage, finder’s or other fee or
commission, in connection with the Transactions (other than such fees or
commissions for which Buyer is solely responsible).
ARTICLE VI
COVENANTS AND AGREEMENTS
     6.1 Approvals and Consents; Required Payments
          (a) Buyer and Seller shall file the Buyer FDA Letters and the Seller
FDA Letters, respectively, with the FDA on the Closing Date. Notwithstanding
anything contrary herein, Seller shall be solely responsible for the payment of
any filing or similar fees payable to the FDA with respect to the transfer of
the Vasovist NDA and the Purchased Assets to Buyer. Transfer of title to the
Vasovist NDA to Buyer shall be effective as of the Closing Date. Transfer of
title to the Vasovist NDS and Vasovist MAA, including all modifications thereto
for which approval is granted by Health Canada or the ATGA (as the case may be),
to Buyer shall be made pursuant to the terms of the Termination Agreement.
          (b) On or prior to the Closing Date, Seller shall pay to all
counterparties (including Bayer) and any of their respective Affiliates, all
Liabilities due and payable or otherwise accrued before, or in connection with,
the Closing and/or the Transactions under (i) the Specified Contracts and
(ii) Section 13.4 of the Bayer Collaboration Agreement (which Liabilities
thereunder equal $10,500,000), in each case, in full satisfaction of all
Liabilities owed or accrued thereunder as of the Closing. All payments made or
required to be made pursuant to this Section 6.1(b) are referred to herein as
the “Required Payments.” Notwithstanding the foregoing, “Required Payments”
shall not include (x) the $3,687,000 payable to Bayer pursuant to Section 10.3
of the Termination Agreement, which shall be paid by Seller in accordance with
the terms and conditions of the Termination Agreement, or (y) up to €7,000
payable by Seller to Bayer in respect of accrued legal and filing fees pursuant
to the letter agreement between Seller and Bayer dated November 14, 2008.
     (c) The Parties waive compliance with the Bulk Sales Act (Ontario, Canada)
and any other similar bulk sales Laws.

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     6.2 Publicity. Within four (4) business days following the Execution Date,
each of the Parties shall issue a press release, and Seller shall file a current
report on Form 8-K, announcing the Transactions, and each such press release and
current report shall be in form and substance reasonably satisfactory to each of
the Parties; provided, that the foregoing shall not prohibit the filing of such
Form 8-K by Seller to the extent required, and by the due date prescribed, by
applicable law so long as Seller uses its good faith efforts to consider any
reasonable and timely comments provided by Buyer. Except as provided in the
foregoing sentence, following the Closing, neither Party may issue any further
publication, press release or other public announcement relating to the
Transaction Documents or the Transactions without the other Party’s prior
written consent, unless disclosure, filing or registration is required by Law
(in which case, the Party required to make such disclosure, filing or
registration shall, in addition to complying with Section 10.2, and subject to
any restrictions of applicable Law, give reasonable advance notice of any such
legally required disclosure to the other Party, and such other Party may provide
any comments on the proposed disclosure, and such disclosing Party shall use its
good faith efforts to consider any reasonable comments that such other Party may
have with respect thereto). The Parties shall reasonably cooperate, each at its
own expense, in such disclosure, filing or registration, including such
confidential treatment request, and shall execute all documents reasonably
required in connection therewith.
     6.3 Further Assurances.
          (a) Each of Buyer and Seller shall, at the request of the other Party
and at such other Party’s expense, promptly execute and deliver to such other
Party all such further instruments, assignments (including Intellectual Property
assignments), assurances, filings and other documents and take any actions as
such other Party may reasonably request in connection with the carrying out and
effectuating the Transaction Documents and the Transactions (including without
limitation, filing with the FDA, Health Canada or the ATGA, any other notices,
assignments, documents and/or other materials required by the FFDCA, Canadian
Drug Law or Australian Drug Law and their respective implementing regulations),
including any materials necessary for the approval of any changes to the
Vasovist MAA and the Vasovist NDS required to enable the Product as presently
being manufactured to be supplied in Australia and Canada, respectively,
regardless of whether such request occurs before, at or after Closing. The Party
making any request pursuant to this Section 6.3 shall promptly reimburse the
other Party for all out-of-pocket expenses reasonably incurred by such other
Party in providing the further assurances requested by such requesting Party.
          (b) Upon and subject to delivery by Bayer to Seller of a written
consent relating to the license and sublicense contemplated by this
Section 6.3(b), which consent shall not contain any requirement for payment by
Seller or any other obligation on the part of Seller, Seller shall grant to
Purchaser: (i) a royalty-free license under the Worldwide IP owned or licensed
by Seller as of the Closing Date and not otherwise conveyed to Buyer pursuant to
Section 2.1 to make (or have made by a contract manufacturer) the Product
anywhere in the world solely for use, sale, and import in and into the
Territory; and (ii) a sublicense under all of the rights granted to Seller upon
termination of the Bayer Collaboration Agreement (as such

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rights exist on the Closing Date) to make (or have made by a contract
manufacturer) the Product anywhere in the world solely for use, sale, and import
in and into the Territory.
          (c) Seller hereby grants to Purchaser: (i) a royalty-free license to
develop, have developed, make, have made, use, sell, distribute and import the
Product in the Territory under the Worldwide IP owned or licensed by Seller as
of the Closing Date, not otherwise conveyed to Buyer pursuant to Section 2.1 and
required to be conveyed to make the representations and warranties set forth in
Section 4.9 true and correct as of the Closing Date; and (ii) a sublicense under
all of the rights granted to Seller upon termination of the Bayer Collaboration
Agreement (as such rights exist on the Closing Date) to make (or have made by a
contract manufacturer) the Product in the Territory solely for use, sale, and
import in and into the Territory (the Intellectual Property described in clauses
(i) and (ii) is referred to herein collectively as the “Sublicensed Intellectual
Property”).
     6.4 Delivery of Purchased Assets; General Consultation and Cooperation;
Pharmacovigilance.
          (a) Seller shall physically deliver, at its sole expense, the tangible
embodiments of the Purchased Assets to Buyer within five (5) Business Days after
the Closing Date, except the Product Records related to the Vasovist NDS and
Vasovist MAA that are not in Seller’s possession as of the Closing Date
(including all modifications to the Vasovist NDA and Vasovist MAA for which
approval is granted by Health Canada or the ATGA (as the case may be)), which
tangible embodiments shall be delivered to Buyer by Bayer or Seller after the
Closing Date in accordance with the terms of the Termination Agreement.
          (b) At Buyer’s reasonable request, Seller shall, at Buyer’s expense
and during normal business hours upon reasonable notice, use its commercially
reasonable efforts to make Seller’s Representatives available to consult with
Buyer about the Product or the Purchased Assets; provided that such consultation
shall not unreasonably disrupt Seller’s operations. If Buyer shall become
engaged in or participate in any Legal Proceeding with any third party relating
in any way to the Product or the Purchased Assets, then Seller shall, at Buyer’s
sole expense, reasonably cooperate with Buyer in connection therewith,
including, by using its commercially reasonable efforts to make available to
Buyer such Representatives who may be helpful with respect to such Legal
Proceeding.
          (c) From and after the Closing, Seller shall provide (or provide in a
form that can be so provided or otherwise make available) to Buyer copies of all
files, reports, books, records, documents and similar materials (in each case,
whether or not in electronic form) owned or licensed by Seller to the extent any
such materials relate (but do not primarily pertain) to (i) the Product in the
Territory or the Purchased Assets or (ii) the Exploitation of the Product in the
Territory, regulatory approval, testing, handling, processing, recordkeeping,
storage, warehousing, disposal, packaging, labeling, promotion, import or export
of the Product in the Territory; provided, that Seller may redact or withhold
any portion of such materials that do not relate to the Product in the Territory
or the Purchased Assets; provided, further, that Seller shall not be required to
make available to Buyer any books, documents, records, files and similar

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materials (in each case, whether or not in electronic form) prepared in
connection with Transaction or maintained by Seller and/or its Representatives,
agents or licensees in connection with their respective ongoing Tax
requirements; provided, further, Seller shall provide to Buyer within thirty
(30) days after the Closing Date copies of all such materials that are within
Seller’s possession as of the Closing Date and a description of all regulatory
filings, drug master files and other regulatory dossiers and Approvals with
respect to Australia.
          (d) After the Closing, each Party shall make available on a timely
basis to the other Party all pharmacovigilance materials in such Party’s
possession or to which such Party has access that relate to the Product in or
outside the Territory, including all FDA, Health Canada and ATGA safety
submissions and raw data, including periodic safety update reports.
          (e) The obligations of the Parties under Section 6.4(a), (b) and (c)
shall terminate on the date that is twelve (12) months after the Closing Date,
and thereafter, any Representatives shall be made available for such time and
upon such terms and conditions (including, but not limited to, compensation) as
the Parties may mutually agree. The obligations of the Parties under
Section 6.4(d) shall survive indefinitely.
     6.5 Retention of Books and Records and Information. Seller and Buyer agree
that each shall preserve and keep the records held by it relating to the
Purchased Assets for a period of seven (7) years from the Closing Date and shall
make such records and personnel available to the other as may be reasonably
required by such Party in connection with, among other things, any insurance
claims by, Legal Proceedings or Tax audits against or governmental
investigations of Seller or Buyer or in order to enable Seller or Buyer to
comply with their respective obligations under the Transaction Documents. In the
event Seller or Buyer wishes to destroy such records after that time, such Party
shall first give thirty (30) days prior written notice to the other and such
other Party shall have the right at its option and expense, upon prior written
notice given to such Party within that thirty (30) day period, to take
possession of the records within sixty (60) days after the date of such notice.
     6.6 Non-Compete.
          (a) Seller Obligations. Neither Seller nor any of its Affiliates
shall, for a period of five (5) years following the Closing Date, directly or
indirectly, (i) engage in the Exploitation of a Competing Product in the
Territory (including, without limitation, by owning, managing, controlling,
operating, performing, or having any conflicting interest in, or otherwise being
engaged in or concerned with, a business or any products approved by a competent
Governmental Authority as a generic version of a Competing Product in the
Territory), (ii) solicit any customers of the Product in the Territory to
terminate or otherwise materially and adversely affect their business
relationships with Buyer or (iii) use or attempt to use any Assigned
Intellectual Property in the Territory. In furtherance of the foregoing, for a
period of five (5) years following the Closing Date, Seller and its Affiliates
shall use commercially reasonable efforts not to distribute, market, promote,
license or sublicense, offer for sale or sell the Product to any Person outside
of the Territory that Seller or its Affiliates knows is reasonably likely to
Exploit the Product in the Territory or assist another Person to do so.
Notwithstanding anything

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herein to the contrary, nothing in this Section 6.6(a) shall prohibit or
restrict the ability of Seller or any Subsidiary or Affiliate of Seller,
directly or indirectly, to (x) engage in any activities described in clause (i)
outside of the Territory, (y) retain any customers of the Product (including
customers of the Product in the Territory) as a consultant to Seller on matters
other than relating to a Competing Product or (z) beneficially own less than one
percent (1%) of the outstanding securities of any publicly-traded Person.
          (b) Buyer Obligations. Neither Buyer nor any of its Affiliates shall,
following the Closing Date, directly or indirectly: (i) engage in the
Exploitation of the Product, or any successor to the Product or generic
formulation of the Product, outside the Territory (including, without
limitation, by owning, managing, controlling, operating, performing, or having
any conflicting interest in, or otherwise being engaged in or concerned with, a
business or any products approved by a competent Governmental Authority as a
generic version of the Product outside the Territory) or (ii) use or attempt to
use any Assigned Intellectual Property outside the Territory. In furtherance of
the foregoing, Buyer and its Affiliates shall use commercially reasonable
efforts not to distribute, market, promote, license or sublicense, offer for
sale or sell the Product, or any successor to the Product or generic formulation
of the Product, to any Person in the Territory that Buyer or its Affiliates
knows is reasonably likely to Exploit the Product (or such successor or generic
formulation) outside the Territory or assist another Person to do so.
Notwithstanding anything herein to the contrary, nothing in this Section 6.6(b)
shall prohibit or restrict the ability of Buyer or any Subsidiary or Affiliate
of Buyer, directly or indirectly, to (A) engage in any activities described in
clause (i) inside of the Territory, (B) engage in the activities permitted under
Section 6.3(b) but only to the extent that a license and sublicense have been
granted pursuant Section 6.3(b), (C) beneficially own less than one percent (1%)
of the outstanding securities of any publicly-traded Person or (D) Exploit,
import, export, lease, license, sublicense or otherwise exploit, or otherwise
own, have an interest in, or have commercial arrangements with respect to, any
product, including a Competing Product, not derived from or based upon the
Product or the Purchased Assets, whether outside or inside the Territory. The
provisions of this Section 6.6(b) shall terminate upon the earliest of (x) the
acquisition of the ROFN Assets by Buyer and (y) the fifth (5th) anniversary of
the Closing Date.
          (c) Material Inducement. Each Party acknowledges and agrees that the
covenants and agreements contained in this Section 6.6 (i) have been negotiated
in good faith by the Parties, (ii) are reasonable and not more restrictive or
broader than necessary to protect the interests of Buyer and Seller and
(iii) would not achieve their intended purposes if such covenants and agreements
were on different terms or for periods of time shorter than the periods of time
provided herein or were applied in more restrictive geographical areas. Each of
the Parties further acknowledges and agrees that neither Buyer nor Seller would
enter into this Agreement but for the covenants and agreements contained in this
Section 6.6 and that such covenants and agreements are essential to protect the
value of the Parties’ interests.
          (d) Blue Pencil Provision. If any provision (or any part thereof) of
this Section 6.6 is held to be unenforceable because of the duration or scope of
such provision, the type of conduct being restricted herein or the area of such
provision’s applicability, the court

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making such determination shall have the power to modify such duration, scope,
type of conduct, area and/or other terms of such provision to the minimum extent
necessary in order to make such provision enforceable, and such provision shall
then be enforceable in such modified form (provided that such modified provision
is not more restrictive to the applicable Party than the original provision set
forth in this Agreement).
          (e) Equitable Remedies. Each Party further acknowledges, stipulates
and agrees that a breach of this Section 6.6 will result in irreparable harm and
continuing damage to the other Party for which there will be no adequate remedy
at law and further agrees that, in the event of any breach hereof, such other
Party will be entitled to injunctive relief (without the need to post any bond
or prove actual damages) and to such other relief as is proper under the
circumstances.
     6.7 Non-Solicitation. For a period commencing on the Execution Date and
ending one (1) year following the Closing Date, no Party shall, directly or
indirectly, (a) solicit for employment or hire any employee of the other Party
who is listed on Schedule 6.7 or (b) induce or attempt to influence any such
employee to terminate his or her employment with such other Party; provided that
the foregoing shall not apply to the solicitation or hiring of any person
(i) via general solicitations not targeted at employees of the other Party,
(ii) who initiates discussions with such Party or (iii) who terminates, or is
terminated from, his or her employment with such other Party.
     6.8 Right of First Negotiation.
          (a) Schedule 6.8(a) sets forth an accurate and complete list of all of
the rights, title or interests in or to any Intellectual Property, regulatory
materials, inventory, data files and/or other assets primarily pertaining to the
Product outside of the Territory that is owned or licensed by Seller and/or any
of its Subsidiaries (collectively, the “Offerors”) as of the Execution Date
(such assets, together with any assets primarily pertaining to the Product
outside of the Territory that become owned or licensed by the Offerors from time
to time after the Execution Date, are referred to herein individually and
collectively as the “ROFN Assets”).
          (b) Negotiation Rights. In the event that any time after the Execution
Date, the Offerors wish to sell, license or sublicense material rights relating
to, or otherwise transfer, any ROFN Assets to any one or more Persons (other
than any Affiliate of the Offerors), other than in a Permitted Transaction (a
“ROFN Acquisition Transaction”), the Offerors shall provide Buyer with written
notice specifying the material terms (including price) of the proposed ROFN
Acquisition Transaction (the “ROFN Notice”), and, for a period of twenty
(20) days following Buyer’s receipt of the ROFN Notice (the “Exclusive
Negotiation Period”), the Offerors shall negotiate with Buyer exclusively and in
good faith to reach a definitive agreement pursuant to which Buyer would acquire
the ROFN Assets. During the Exclusive Negotiation Period, Seller shall in good
faith grant Buyer timely and reasonable access to due diligence materials
relating to the ROFN Assets specified in the ROFN Notice to enable Buyer to
conduct a reasonable due diligence review and examination regarding its possible
acquisition of such ROFN Assets; provided, that such due diligence review shall
not unreasonably disrupt Seller’s operations.

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Except as set forth in Section 6.8(d) below, in the event that the Offerors and
Buyer do not reach a definitive agreement within the Exclusive Negotiation
Period with respect to the purchase and sale of the ROFN Assets specified in the
ROFN Notice, then the Offerors shall have no further obligations to Buyer under
this Section 6.8.
          (c) Standstill. During the Exclusive Negotiation Period, Seller shall
not, and shall not permit any of its Representatives to, directly or indirectly,
(i) discuss, encourage, negotiate, undertake, initiate, authorize, recommend,
propose or enter into, any ROFN Acquisition Transaction, (ii) facilitate,
encourage, solicit or initiate discussions, negotiations or submissions of
proposals or offers in respect of an ROFN Acquisition Transaction, (iii) furnish
or cause to be furnished, to any Person, any information concerning the ROFN
Assets in connection with a ROFN Acquisition Transaction or (iv) otherwise
cooperate in any way with, or assist or participate in, facilitate or encourage,
any effort or attempt by any other Person to do or seek any of the foregoing.
          (d) Expiration of Exclusive Negotiation Period. Upon expiration of the
Exclusive Negotiation Period, Offerors may negotiate with any other Person and
take any and all actions with respect to the ROFN Assets; provided that, in the
event that no Offeror has entered into a definitive agreement to consummate a
ROFN Acquisition Transaction with any other Person within one hundred twenty
(120) days after the expiration of the Exclusive Negotiation Period, then Seller
shall be obligated to issue a new ROFN Notice pursuant to Section 6.8(b) (and,
for the sake of clarity, a new Exclusive Negotiation Period with Buyer shall
commence under Sections 6.8(b) and the Offerors shall be subject to the
obligations set forth in Sections 6.8(b) and 6.8(c) during such new Exclusive
Negotiation Period) before continuing any such negotiations with any other
Person or initiating additional negotiations with any other Person. For the
avoidance of doubt, Offerors shall not be required to provide a ROFN Notice more
than once in any one hundred twenty (120) day period, regardless of whether any
Offeror receives additional proposals for a ROFN Acquisition Transaction during
such period or whether the proposal that was the subject of the applicable ROFN
Notice has been materially modified.
          (e) Non-Contravention. Seller hereby agrees not to enter into any
agreement relating to a sale of the ROFN Assets (other than in a Permitted
Transaction) without first complying with the terms of this Section 6.8.
          (f) Termination. The rights and obligations set forth in this
Section 6.8 shall remain in full force and effect until the fifth (5th)
anniversary of the Closing Date (the “ROFN Period”), at which time all such
rights and obligations shall terminate.
ARTICLE VII
CONDITIONS PRECEDENT TO CLOSING
     7.1 Conditions Precedent to the Obligations of Buyer. The obligations of
Buyer to consummate the Transactions are subject to the fulfillment of the
following conditions, any of which may be waived by Buyer:

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          (a) Representations and Warranties. The representations and warranties
of Seller set forth in ARTICLE IV shall be true and correct in all material
respects at and as of the Execution Date and the Closing Date (or any other date
specifically referenced therein), except to the extent that such representations
and warranties are qualified by terms such as “material” and “Material Adverse
Effect,” in which case such representations and warranties shall be true and
correct in all respects at and as of the Execution Date and the Closing Date (or
any other date specifically referenced therein).
          (b) Covenants. Seller shall have performed and complied in all
material respects with all covenants and agreements contained herein and
required to be performed or complied with by it on or before the Closing Date.
          (c) Documents. Buyer shall have received all of the agreements and
documents specified in Section 3.4(a).
          (d) No Litigation or Prohibition. There shall not be any Legal
Proceeding threatened or asserted in writing, initiated or pending arising out
of, or in connection with, or otherwise relating to, the Product in the
Territory, the Purchased Assets or the Transactions. There shall not be in
effect any Order restraining, enjoining or otherwise prohibiting the
consummation of the Transactions.
          (e) Regulatory Matters.
     (i) (A) The FDA shall not have modified or revoked any Approvals relating
to the Product in the U.S. Territory after December 22, 2008, (B) Health Canada
shall not have modified or revoked any Approvals relating to the Product in
Canada after October 16, 2006, other than any modifications resulting from an
approval granted by Health Canada of changes thereto required to enable the
Product as presently being manufactured to be supplied in Canada, and (C) the
ATGA shall not have modified or revoked any Approvals relating to the Product in
Australia after August 24, 2006, other than any modifications resulting from an
approval granted by the ATGA of changes thereto required to enable the Product
as presently being manufactured to be supplied in Australia.
     (ii) Except as set forth on Schedule 7.2(e)(ii), there shall not be any
outstanding requests for information or orders from the FDA, Health Canada or
ATGA relating to the Approvals relating to the Product in the Territory.
     (iii) Seller shall have filed an application for a Patent Term Extension of
U.S. Patent Nos. 6,676,929 and 7,060,250 under the Hatch-Waxman Act with respect
to the Product.
     (iv) Seller shall have entered into, and shall have obligated its
Pharmacovigilance Provider to provide to Buyer those sources essentially as
described in, the Pharmacovigilance Agreement among Bayer, Seller and TMC Pharma
Services, Ltd., in form and substance reasonably acceptable to Buyer and

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Seller; provided, however, that Buyer shall be responsible for reporting to the
FDA, Health Canada and the ATGA.
     (v) Seller shall have made available to Buyer all rights and obligations of
Seller to pharmacovigilance materials that relate to the Product in or outside
the Territory, including all FDA, Health Canada and ATGA safety submissions and
raw data and periodic safety update reports.
     (f) Additional Intellectual Property Contracts.
     (i) Manufacturing and Supply Agreement. Buyer and Covidien shall have
entered into, and Seller shall have acknowledged, a manufacturing and supply
agreement in form and substance reasonably acceptable to Buyer and Seller.
     (ii) Prince Assignment. Buyer and Seller shall have entered into an
assignment agreement in form and substance reasonably acceptable to Buyer and
Seller.
     (iii) Bayer Purchase Agreement. Bayer and Buyer shall have entered into,
and Seller and TMC Pharma Services, Ltd. shall have acknowledged, a purchase
agreement for inventory, manufacturing improvements and know-how in form and
substance reasonably acceptable to Buyer and Seller.
     (iv) Termination Agreement. Bayer, TMC Pharma Services, Ltd., Seller, and
with respect to certain provisions, Buyer shall have entered into the
Termination Agreement in form and substance reasonably acceptable to Buyer and
Seller.
     (v) Settlement and Release Agreement. Bayer, Covidien and Seller shall have
entered into a settlement and release agreement in form and substance reasonably
acceptable to Buyer and Seller.
     7.2 Conditions Precedent to the Obligations of Seller. The obligations of
Seller to consummate the Transactions are subject to the fulfillment of the
following conditions, any of which may be waived by Seller:
          (a) Representations and Warranties. The representations and warranties
of Buyer set forth in ARTICLE V shall be true and correct in all material
respects at and as of the Execution Date and the Closing Date (or any other date
specifically referenced therein), except to the extent that such representations
and warranties are qualified by terms such as “material” and “material adverse
effect,” in which case such representations and warranties shall be true and
correct in all respects at and as of the Execution Date and the Closing Date (or
any other date specifically referenced therein).

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          (b) Covenants. Buyer shall have performed and complied in all material
respects with all covenants and agreements contained herein and required to be
performed or complied with by it on or before the Closing Date.
          (c) Documents. Seller shall have received all of the agreements and
documents specified in Section 3.4(b).
          (d) Legal Proceedings; No Prohibition. There shall not be any Legal
Proceeding threatened or asserted in writing, initiated or pending arising out
of, or in connection with, or otherwise relating to, the Product in the
Territory, the Purchased Assets or the Transactions. There shall not be in
effect any Order restraining, enjoining or otherwise prohibiting the
consummation of the Transactions.
     7.3 Frustration of Closing Conditions. Neither Party may rely on the
failure of any conditions set forth in this ARTICLE VII to be satisfied if such
failure was caused by such Party’s material breach of this Agreement.
ARTICLE VIII
INDEMNIFICATION
     8.1 Indemnification by Seller. Subject to all of the limitations set forth
in this ARTICLE VIII, Seller agrees to indemnify, defend and hold Buyer, its
Affiliates and each of their respective directors, officers, employees,
controlling Persons, agents, attorneys, representatives, successors and
permitted assigns (Buyer and such Persons are collectively hereinafter referred
to as “Buyer’s Indemnified Persons”), harmless from and against any and all
loss, Liability, damage or deficiency, including interest, penalties, reasonable
costs of preparation and investigation, and reasonable attorneys’ fees and
disbursements (individually a “Loss,” and collectively, “Losses”) that Buyer’s
Indemnified Persons may suffer, sustain, incur or become subject to, arising out
of or due to: (a) the failure of any representation or warranty of Seller in
ARTICLE IV to be true and correct as of the Execution Date or the Closing Date;
(b) the breach of any covenant, undertaking, agreement or other obligation of
Seller under this Agreement; or (c) any Excluded Asset or Excluded Liability.
     8.2 Indemnification by Buyer. Subject to all of the limitations set forth
in this ARTICLE VIII, Buyer agrees to indemnify, defend and hold Seller, its
Affiliates and each of their respective directors, officers, employees,
controlling Persons, agents, attorneys, representatives, successors and
permitted assigns (Seller and such Persons are hereinafter collectively referred
to as “Seller’s Indemnified Persons”), harmless from and against any and all
Losses that Seller’s Indemnified Persons may, suffer, sustain, incur or become
subject to, arising out of, or due to: (a) the failure of any representation or
warranty of Buyer in ARTICLE V to be true and correct as of the Execution Date
or the Closing Date; (b) the breach of any covenant, undertaking, agreement or
other obligation of Buyer under this Agreement; or (c) any Assumed Liability.

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     8.3 Survival of Representations and Warranties; Limitations.
          (a) The representations and warranties of the Parties contained in
this Agreement shall survive the Closing Date and shall remain in full force and
effect thereafter for a period of eighteen (18) months and shall be effective
with respect to any claimed breach of the representations and warranties timely
made pursuant to Section 8.4, after which period the representations and
warranties of the Parties contained in this Agreement shall terminate and be of
no further force or effect. Notwithstanding the foregoing, (i) the
representations and warranties set forth in Section 4.3 (No Violation; Consents)
and Section 4.9 (Sufficiency of Assets and Rights) shall survive for six
(6) years and (ii) the representations and warranties set forth in Section 4.2
(Due Authorization), Section 4.6 (Good and Valid Title), Section 4.12 (Broker’s
Fees), Section 5.2 (Due Authorization) and Section 5.7 (Broker’s Fees) shall
survive indefinitely (the representations and warranties referenced in clauses
(i) and (ii) are referred to herein collectively as the “Fundamental
Representations”).
          (b) Anything to the contrary contained herein notwithstanding, neither
Party shall be entitled to any recovery from the other Party with respect to any
breach of such representations and warranties unless and until the amount of
such Losses suffered, sustained or incurred by the asserting Party, or to which
such Party becomes subject, by reason of such breach, shall exceed One Hundred
Forty Thousand Dollars ($140,000) calculated on a cumulative basis and not a per
item basis (the “Basket Amount”), and in such event, the indemnifying party
shall be required to pay the amount of such Losses exceeding the Basket Amount.
In no event shall either Party be liable to the other Party under this Agreement
in an aggregate amount in excess of Five Million Six Hundred Dollars
($5,600,000) (the “Cap”). The Basket Amount and the Cap shall not be applicable
to (i) any breach of any Fundamental Representations, (ii) Losses indemnifiable
under Section 8.1(b), 8.1 (c), 8.2(b) or 8.2(c) or (iii) Losses based on fraud.
          (c) For purposes of determining the failure of any representations or
warranties to be true and correct, the breach of any covenants or agreements and
calculating Losses hereunder, any materiality or Material Adverse Effect
qualifications in the representations, warranties, covenants and agreements
shall be disregarded.
          (d) The right to indemnification or any other remedy based on
representations, warranties, covenants and agreements in the Transaction
Documents shall not be affected by any investigation conducted at any time, or
any knowledge acquired (or capable of being acquired) at any time, whether
before or after the execution and delivery of this Agreement or the Closing
Date, with respect to the accuracy or inaccuracy of, or compliance with, any
such representation, warranty, covenant or agreement.
          (e) Seller shall not be required to indemnify any Buyer’s Indemnified
Persons, and Buyer shall not be required to indemnify any Seller’s Indemnified
Persons, to the extent of any Losses that any court of competent jurisdiction
shall have determined by final judgment to have resulted from the bad faith,
gross negligence or willful misconduct of the party seeking indemnification.

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          (f) Anything herein to the contrary notwithstanding, no breach of any
representation, warranty, covenant or agreement contained herein shall give rise
to any right on the part of Party or any Indemnified Person, after the
consummation of the Transactions, to rescind this Agreement or any of the
Transactions; provided that nothing in this clause (f) shall restrict any
remedies for fraud.
          (g) Any liability for indemnification under this Article VIII shall be
determined without duplication of recovery by reason of the state of facts
giving rise to such liability constituting a breach of more than one
representation, warranty, covenant or agreement.
          (h) Notwithstanding any other provision in this Agreement, neither
Seller nor Buyer shall in any event be liable to the other Party or any of the
other Party’s Indemnified Persons on account of any indemnity obligation set
forth in Section 8.1 or Section 8.2 for (i) any Losses that are not direct,
actual damages or (ii) any special, incidental or punitive damages, in each
case, unless such Losses are paid pursuant to a third party claim.
     8.4 Indemnification Procedure.
          (a) A claim for indemnification for any matter not involving a
third-party claim may be asserted by notice issued in accordance with
Section 11.2 to the Party from whom indemnification is sought.
          (b) In the event that any Legal Proceedings shall be instituted, or
that any claim shall be asserted, by any third party in respect of which payment
may be sought under Sections 8.1 and 8.2 hereof (regardless of the limitations
set forth in Section 8.3) (an “Indemnification Claim”), the Indemnified Person
shall promptly cause written notice of the assertion of any Indemnification
Claim of which it has knowledge that is covered by this indemnity to be
forwarded to the Party against whom indemnification is sought (the “Indemnifying
Party”). The failure of the Indemnified Person to give reasonably prompt notice
of any Indemnification Claim shall not release, waive or otherwise affect the
Indemnifying Party’s obligations with respect thereto, except to the extent that
the Indemnifying Party is materially prejudiced as a result of such failure. The
Indemnifying Party shall have the right, at its sole option and expense, to be
represented by counsel of its choice and to defend against, negotiate, settle or
otherwise deal with, any Indemnification Claim that relates to any Losses
indemnified against by it hereunder. If the Indemnifying Party elects to defend
against, negotiate, settle or otherwise deal with any Indemnification Claim that
relates to any Losses indemnified against by it hereunder, it shall within
thirty (30) days (or sooner, if the nature of the Indemnification Claim so
requires) notify the Indemnified Person of its intent to do so. If the
Indemnifying Party elects not to defend against, negotiate, settle or otherwise
deal with, any Indemnification Claim that relates to any Losses indemnified
against hereunder, the Indemnified Person may defend against, negotiate, settle
or otherwise deal with, such Indemnification Claim. If the Indemnifying Party
shall assume the defense of any Indemnification Claim, the Indemnified Person
may participate, at his or its own expense, in the defense of such
Indemnification Claim; provided, however, that such Indemnified Person shall be
entitled to participate in any such defense with separate counsel at the expense
of the Indemnifying Party if

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(i) so requested by the Indemnifying Party to participate or, (ii) in the
reasonable opinion of counsel to the Indemnified Person, a conflict or potential
conflict exists between the Indemnified Person and the Indemnifying Party that
would make such separate representation advisable; and provided, further, that
the Indemnifying Party shall not be required to pay for more than one such
counsel (plus any appropriate local counsel) for all Indemnified Persons in
connection with any Indemnification Claim. The parties hereto agree to cooperate
fully with each other in connection with the defense, negotiation or settlement
of any such Indemnification Claim. Notwithstanding anything in this Section 8.4
to the contrary, neither the Indemnifying Party nor any Indemnified Person
shall, without the written consent of the other Party, settle or compromise any
Indemnification Claim or permit a default or consent to entry of any judgment.
If the Indemnifying Party makes any payment on any Indemnification Claim, the
Indemnifying Party shall be subrogated, to the extent of such payment, to all
rights and remedies of the Indemnified Persons to any insurance benefits or
other claims of the indemnified party with respect to such Indemnification Claim
for payment thereof.
          (c) After any final decision, judgment or award shall have been
rendered by a Governmental Authority of competent jurisdiction and the
expiration of the time in which to appeal therefrom, or a settlement shall have
been consummated, or the Indemnified Persons and the Indemnifying Party shall
have arrived at a mutually binding agreement with respect to an Indemnification
Claim hereunder, the Indemnified Persons shall forward to the Indemnifying Party
notice of any sums due and owing by the Indemnifying Party pursuant to this
Agreement with respect to such matter.
     8.5 Character of Payments. To the extent permitted by applicable Law, the
Parties agree that any indemnification payments (and/or payments or adjustments)
made with respect to this Agreement shall be treated for all Tax purposes as an
adjustment to the Purchase Price.
     8.6 Calculation of Losses(a) . The amount of any Losses for which
indemnification is provided under this Article VIII shall be net of any amounts
actually recovered by the indemnified party under insurance policies with
respect to such Losses (net of any Tax or expenses incurred in connection with
such recovery). Each Indemnified Person shall take, and shall cause its
Affiliates to take, all commercially reasonable efforts to mitigate and
otherwise minimize the Losses to the maximum extent reasonably possible upon,
and after becoming aware of, any event which would reasonably be expected to
give rise to any Losses. Each Indemnified Person shall use commercially
reasonable efforts to collect any amounts available under insurance coverage, or
from any other Person alleged to be responsible, for any Losses to the same
extent that such Indemnified Person would if such Loss were not subject to
indemnification hereunder.
     8.7 Exclusive Remedy. From and after the Closing, the sole and exclusive
remedies for (a) any breach or failure to be true and correct, or alleged breach
or failure to be true and correct, of any representation or warranty in this
Agreement shall be indemnification in accordance with this Article VIII, or
(b) any breach, or alleged breach, of any covenant or agreement in this
Agreement (other than the covenants set forth in Sections 6.6 and ARTICLE X)
shall be indemnification in accordance with this Article VIII and, subject to
Section 8.3(f),

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specific performance, injunction or other equitable relief; provided, however,
that no Party shall be deemed to have waived any rights, claims, causes of
action or remedies if and to the extent that (i) such rights, claims, causes of
action or remedies may not be waived under applicable Law or (ii) such Party
proves the other Party’s actual fraud, intentional misrepresentation or active
concealment.
ARTICLE IX
TAX MATTERS
     9.1 Cooperation on Tax Matters.
          (a) Notwithstanding anything in Section 6.4(c) to the contrary, Seller
and Buyer agree to furnish or cause to be furnished to the other, upon request,
as promptly as practicable, such information (including access to books and
records) relating to the Purchased Assets and the Assumed Liabilities as is
reasonably necessary for the filing of any Tax Return, the preparation for any
Tax audit, or the prosecution or defense of any claim relating to any proposed
Tax adjustment. Buyer and Seller shall keep all such information and documents
received by them confidential in accordance with ARTICLE X.
          (b) Notwithstanding anything in Section 6.4(c) to the contrary, Buyer
and Seller shall reasonably cooperate with each other in the conduct of any
audit or other proceedings relating to the Purchased Assets or the Assumed
Liabilities and they shall each execute and deliver such powers of attorney and
other documents as are reasonably necessary to carry out the intent of this
Agreement.
     9.2 Transfer Taxes. One-half of all goods and services, sales, use and
transfer Taxes, including but not limited to any value added, gross receipts,
stamp duty and personal or intangible property transfer Taxes and other such
Taxes and any conveyance fees or recording charges due by reason of the transfer
of the Purchased Assets, including but not limited to any interest or penalties
in respect thereof (the “Transfer Taxes”) shall be paid by Buyer and one-half of
the Transfer Taxes shall be paid by Seller. The Party required by Law to file a
Tax Return with respect to any Transfer Taxes shall file such Tax Return, and
the other Party shall promptly reimburse the filing Party for such other Party’s
portion of any Transfer Taxes paid by the filing Party. Seller and Buyer shall
reasonably cooperate with each other and use their reasonable best efforts to
minimize the Transfer Taxes attributable to the transfer of the Purchased Assets
and shall use their best efforts to obtain any certificate or document from any
Governmental Authority as may be necessary to mitigate such Taxes.
     9.3 Allocation. In accordance with Section 1060 of the Code and the
Treasury Regulations thereunder, Seller and Buyer agree to allocate the Total
Consideration (and all other relevant items) as determined for federal income
tax purposes among the Purchased Assets and the covenants contained in
Sections 6.6 and 6.7 hereof for Tax purposes. Buyer and Seller shall report,
act, and file all Tax Returns in all respects and for all purposes consistent
with such allocation. In furtherance of the foregoing, not later than sixty
(60) days after the Closing Date,

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Buyer shall prepare and deliver to Seller a proposed statement with respect to
such allocation, together with reasonable detail regarding the methods and
calculations used by Buyer to determine such allocation. Seller shall have
thirty (30) days thereafter to review such allocation statement and notify Buyer
of any changes proposed by Seller to such allocation. If Seller does not provide
any such notice within such 30-day period, Seller shall be deemed to have agreed
to the allocation proposed by Buyer and all income Tax Returns and reports filed
by Buyer and Seller shall be prepared consistently with such allocation. To the
extent Seller provides a notice proposing changes, Buyer shall work in good
faith with Seller to address such changes and to revise the allocation statement
in a manner mutually agreeable to both parties and all income Tax Returns and
reports filed by Buyer and Seller shall be prepared consistently with such
mutually agreed allocation; provided, that if Seller and Buyer are unable to
agree on the allocation statement, each of Seller and Buyer shall prepare their
respective income Tax Returns in accordance with the first sentence of this
Section 9.3 (but shall have no obligation to prepare such reports in a manner
consistent with Buyer’s proposed allocation statement).
ARTICLE X
CONFIDENTIALITY
     10.1 Confidential Information.
          (a) Each of the Parties (the “Receiving Party”) acknowledges its
possession of Confidential Information (as defined below) of the other Party
(the “Disclosing Party”). From and after the Closing Date, subject to
Sections 6.2 and 10.2 and except as contemplated by the Transaction Documents,
the Receiving Party shall not, and shall cause its Representatives not to,
directly or indirectly, disclose, reveal, divulge or communicate the
Confidential Information of the Disclosing Party to any third Person other than
the Receiving Party’s Representatives. The Receiving Party and its
Representatives shall use the same degree of care to prevent and restrain the
unauthorized use or disclosure of the Confidential Information as the Receiving
Party and such Representatives, respectively, currently uses for its own
confidential information of a like nature, but in no event less than a
commercially reasonable standard of care. “Confidential Information” of the
Disclosing Party means any confidential or proprietary information, data,
material or documents that, (a) with respect to Buyer as the Disclosing Party,
primarily pertains to the Product in the Territory, the Purchased Assets and/or
the Assumed Liabilities, (b) with respect to Seller as the Disclosing Party,
primarily pertains to the Product outside the Territory, the Excluded Assets
and/or the Excluded Liabilities or, (c) with respect to either Party as the
Disclosing Party, primarily pertains to the Transaction Documents and/or the
Transactions and/or otherwise disclosed under the Transaction Documents, in each
case, irrespective of the form of communication, and all notes, analyses,
compilations, forecasts, data, translations, studies, memoranda or other
documents prepared by the Receiving Party or its Representatives that contain or
otherwise reflect such information, data, material or documents.
          (b) Notwithstanding the foregoing, “Confidential Information” does not
include, and there shall be no obligation hereunder with respect to,
information, data, material or documents that (i) are or become generally
available to the public, other than as a result of a

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disclosure by the Receiving Party or its Representatives in breach of this
Agreement, (ii) was available to the Receiving Party or its Representatives on a
non-confidential basis prior to disclosure by the Disclosing Party or its
Representatives, (iii) becomes available to the Receiving Party or its
Representatives on a non-confidential basis from a Person who, to the Receiving
Party’s or such Representative’s knowledge, is not bound by a confidentiality
agreement with the Disclosing Party or (iv) was or is independently developed by
the Receiving Party or its Representatives without use of the Confidential
Information of the Disclosing Party.
          (c) For the sake of clarity, nothing herein shall impose any
obligation on the Seller as the Receiving Party and its Representatives with
respect to their disclosure for Seller’s own legitimate business or other
purposes of information, data, material or documents that relates (but does not
primarily pertain) to the Product in the Territory, the Purchased Assets or the
Assumed Liabilities; and nothing herein shall impose any obligation on Buyer as
the Receiving Party and its Representatives with respect to Buyer’s use or
disclosure for its own legitimate business or other purposes of information,
data, material or documents that relates (but does not primarily pertain) to the
Product outside the Territory, the Excluded Assets and the Excluded Liabilities.
          (d) Notwithstanding anything to the contrary herein, in the event that
Buyer hires or retains any current or former employee or consultant of Seller in
compliance with Section 6.7, Seller agrees to release, and does hereby release,
such employee or consultant from any and all confidentiality and nondisclosure
restrictions of which Seller is the beneficiary, but only for purposes related
to the Product in the Territory.
     10.2 Disclosure Required by Law. If the Receiving Party or any of its
Representatives is required by any Governmental Authority (whether by oral
question, interrogatories, requests for information or documents, subpoena,
civil investigative demand or similar process) or pursuant to applicable Law to
disclose or provide any Confidential Information, the Receiving Party and its
Representatives shall use commercially reasonable efforts to provide (if not
prohibited by such applicable Law or Governmental Authority) the Disclosing
Party with written notice of such request or demand as promptly as practicable
under the circumstances so that the Disclosing Party shall have an opportunity
to seek an appropriate protective Order. The Receiving Party agrees to take, and
cause its Representatives to take, at the Disclosing Party’s expense, all other
commercially reasonable steps necessary to obtain confidential treatment.
Subject to the foregoing, the Receiving Party and its Representatives may
thereafter disclose or provide any such Confidential Information, as the case
may be, to the extent required by such Law (as so advised by counsel) or such
Governmental Authority.
     10.3 Duration of Confidentiality Obligations. This ARTICLE X shall survive
for a period of seven (7) years following the Closing Date.
     10.4 Confidential Disclosure Agreement. Effective as of the Closing, that
certain Confidential Disclosure Agreement dated as of March 31, 2008 by and
between Buyer and Seller shall be of no further force and effect from and after
the Closing Date; provided, however, that

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such Confidential Disclosure Agreement shall remain in effect in accordance with
the terms thereof with respect to any breaches thereof occurring prior to the
Closing Date.
ARTICLE XI
MISCELLANEOUS
     11.1 Expenses. Except as specifically provided herein, Seller and Buyer
shall each pay its own expenses (including the fees and expenses of their
respective agents, representatives, counsel and accountants) incidental to the
preparation, negotiation, and consummation of the Transaction Documents and the
Transactions.
     11.2 Notices. Any notice, request, demand or other communication given by
any Party under this Agreement shall be in writing, may be given by a Party or
its legal counsel, and shall be deemed to be duly given (i) when personally
delivered, or (ii) upon delivery by an internationally recognized express
courier service which provides evidence of delivery, or (iii) when three
(3) days have elapsed after its transmittal by registered or certified mail,
postage prepaid, return receipt requested, addressed to the Party to whom
directed at that Party’s address as it appears below or another address of which
that Party has given notice, or (iv) when delivered by facsimile transmission if
a copy thereof is also delivered in person or by overnight courier. Notices of
address change shall be effective only upon receipt notwithstanding the
provisions of the foregoing sentence.
If to Seller, to:
EPIX Pharmaceuticals, Inc.
4 Maguire Road
Lexington, MA 02421
Attn: Chief Financial Officer
Facsimile: (781) 761-7641

with copies sent concurrently to:

Goodwin Procter LLP
Exchange Place, 53 State Street
Boston, MA 02109
Attn: Christopher Denn, Esq.
          James R. Kasinger, Esq.
Facsimile: (617) 523-1231
If to Buyer, to:
Lantheus Medical Imaging, Inc.
331 Treble Cove Road
North Billerica, MA 01862
Attn: Michael Duffy, Esq.

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Facsimile: (978) 671-8724

with copies sent concurrently to:

Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, NY 10153
Attn: David Blittner, Esq.
Facsimile: (212) 310-8007
provided, however, that if any Party shall have designated a different address
by notice to the other Party, then to the last address so designated.
     11.3 Successors and Assigns; Assignment. This Agreement shall be binding
upon and inure to the benefit of the Parties and their respective successors and
permitted assigns. This Agreement or any part thereof, may not be assigned, in
whole or in part, without the prior written consent of the other Party, which
consent may be withheld in the sole discretion of the other Party; provided,
however, that either Party may assign this Agreement without the consent of the
other Party (i) in whole or in part to any Affiliate of such Party, it being
agreed that no such assignment to a Party’s Affiliate shall release the
assigning Party from its obligations hereunder and provided that the assigning
Party shall give prior written notice of any such assignment to the other Party,
or, (ii) subject to Section 6.8 in connection with the transfer and sale of all
or substantially all of the assets or business of such Party or any of its
Affiliates, it being agreed that no such assignment shall release the assigning
Party from its obligations hereunder. In the event of any assignment hereunder,
the assignee shall enter into a joinder agreement pursuant to which it shall be
subject to the terms, conditions and covenants of this Agreement, and shall be
deemed to be “Buyer” or “Seller,” as applicable, in the same capacity as the
transferring Party. Notwithstanding anything to the contrary in this Agreement,
in no event shall any Permitted Transaction be consummated unless the acquiring
or successor entity in such Permitted Transaction expressly acknowledges and
assumes Seller’s obligations under this Agreement, including under Section 6.8.
     11.4 Entire Agreement; Modification. Except as expressly provided in
Section 10.4, the Transaction Documents supersede all prior Contracts and
understandings between the Parties (written or oral) relating to the subject
matter hereof and thereof, including any term sheets, and the Transaction
Documents are the entire and complete statement of the terms of the agreement
between the Parties with respect to such subject matter. This Agreement may be
amended, modified or supplemented only in a writing signed by Seller and Buyer.
     11.5 Waivers. The failure of a Party hereto at any time or times to require
performance of any provision hereof shall in no manner affect its right at a
later time to enforce the same. No waiver by a Party of any condition or of any
breach of any term, covenant, representation or warranty contained in this
Agreement shall be effective unless in writing, and no waiver in any one or more
instances shall be deemed to be a further or continuing waiver of any such
condition

43

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or breach in other instances or a waiver of any other condition or breach of any
other term, covenant, representation or warranty.
     11.6 Section and Other Headings. The section and other headings contained
in this Agreement are for reference purposes only and shall not in any way
affect the meaning or interpretation of this Agreement.
     11.7 Governing Law. Any controversy, dispute or claim arising under, or in
connection with, or otherwise related to this Agreement (including the
existence, validity, interpretation or breach hereof and any claim based on
contract, tort or statute) shall be exclusively interpreted in accordance with,
and governed by, the Laws of the Commonwealth of Massachusetts, without regard
to the conflicts of law rules thereof.
     11.8 Submission to Jurisdiction; Consent to Service of Process.
          (a) The Parties hereby irrevocably submit to the exclusive
jurisdiction of any federal or state court located within the City of Boston,
Massachusetts over any disputes, controversies or claims arising from, relating
to, or in connection with, this Agreement or any of the Transactions, and each
Party hereby irrevocably agrees that all claims in respect of such dispute or
any suit, action proceeding related thereto may be heard and determined in such
courts. The Parties hereby irrevocably waive, to the fullest extent permitted by
applicable Law, any objection which they may now or hereafter have to the laying
of venue of any such dispute brought in such court or any defense of
inconvenient forum for the maintenance of such dispute. Each of the Parties
agrees that a judgment in any such dispute may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by Law.
          (b) Each of the Parties hereby consents to process being served by any
party to this Agreement in any suit, action or proceeding by the delivery of a
copy thereof in accordance with the provisions of Section 11.2.
     11.9 Severability. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition and unenforceability in
any jurisdiction shall not invalidate or render unenforceable such provision in
any other jurisdiction.
     11.10 No Third Party Beneficiaries. Neither this Agreement nor any
provision hereof is intended to confer upon any Person (other than the Parties
hereto) any rights or remedies hereunder.
     11.11 Construction. The Parties have participated jointly in the
negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the Parties and no presumption or burden of proof shall
arise favoring or disfavoring any Party by virtue of the authorship of any of
the provisions of this Agreement.

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     11.12 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original, and such
counterparts shall together constitute one and the same instrument. A facsimile
or other electronic transmission of an executed counterpart signature page shall
be deemed an original.
     11.13 Incorporation of Schedules and Exhibits. The schedules and exhibits
hereto are incorporated into this Agreement and shall be deemed a part hereof as
if set forth herein in full. References herein to “this Agreement” and the words
“herein,” “hereof” and words of similar import refer to this Agreement
(including its schedules and exhibits as an entirety). In the event of any
conflict between the provisions of this Agreement and any such schedule or
exhibit, the provisions of this Agreement shall control.
[The remainder of this page is left blank intentionally.]

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     IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the
day and year first above written.

            SELLER

EPIX PHARMACEUTICALS, INC.
      By:   /s/ Elkan Gamzu, Ph.D.         Name:   Elkan Gamzu, Ph.D.       
Title:   Chief Executive Officer     

            BUYER

LANTHEUS MEDICAL IMAGING, INC.
      By:   /s/ Michael Duffy         Name:   Michael Duffy        Title:  
Secretary     

 

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ASSET PURCHASE AGREEMENT
by and between
EPIX PHARMACEUTICALS, INC.,
as Seller,
and
LANTHEUS MEDICAL IMAGING, INC.,
as Buyer
As April 6, 2009

 

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TABLE OF CONTENTS
Page

         
ARTICLE I DEFINITIONS; INTERPRETATION
    1  
1.1 Definitions
    1  
1.2 Interpretation
    10  
ARTICLE II PURCHASE AND SALE OF ASSETS AND ASSUMPTION OF LIABILITIES
    10  
2.1 Purchase and Sale of Assets
    10  
2.2 Excluded Assets
    11  
2.3 Assumption of Liabilities
    12  
2.4 Prorations
    13  
ARTICLE III PAYMENT; CLOSING
    13  
3.1 Payment
    13  
3.2 Payment Method
    14  
3.3 The Closing
    14  
3.4 Closing Deliveries
    14  
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF SELLER
    15  
4.1 Organization and Corporate Power
    15  
4.2 Due Authorization
    15  
4.3 No Violation; Consents
    16  
4.4 Intellectual Property
    16  
4.5 Litigation and Claims
    18  
4.6 Good and Valid Title
    18  
4.7 Assigned Contracts
    18  
4.8 Approvals; Compliance with Laws
    19  
4.9 Sufficiency of Assets and Rights
    21  
4.10 Tax Matters
    21  
4.11 Absence of Certain Changes
    21  
4.12 Broker’s Fees
    22  
4.13 Insurance
    22  
4.14 Affiliate Transactions
    22  
4.15 Public Disclosures
    22  

 

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TABLE OF CONTENTS
(continued)
Page

         
4.16 Disclaimer of Other Representations
    22  
ARTICLE V REPRESENTATIONS AND WARRANTIES OF BUYER
    23  
5.1 Organization and Corporate Power
    23  
5.2 Due Authorization
    23  
5.3 No Violation; Consents
    24  
5.4 Litigation
    24  
5.5 Financial Capability
    24  
5.6 Inspection; No Other Representations
    24  
5.7 Broker’s Fees
    25  
ARTICLE VI COVENANTS AND AGREEMENTS
    25  
6.1 Approvals and Consents; Required Payments
    25  
6.2 Publicity
    25  
6.3 Further Assurances
    26  
6.4 Delivery of Purchased Assets; General Consultation and Cooperation;
Pharmacovigilance
    27  
6.5 Retention of Books and Records and Information
    28  
6.6 Non-Compete
    28  
6.7 Non-Solicitation
    29  
6.8 Right of First Negotiation
    30  
ARTICLE VII CONDITIONS PRECEDENT TO CLOSING
    31  
7.1 Conditions Precedent to the Obligations of Buyer
    31  
7.2 Conditions Precedent to the Obligations of Seller
    33  
7.3 Frustration of Closing Conditions
    33  
ARTICLE VIII INDEMNIFICATION
    33  
8.1 Indemnification by Seller
    33  
8.2 Indemnification by Buyer
    34  
8.3 Survival of Representations and Warranties; Limitations
    34  
8.4 Indemnification Procedure
    35  
8.5 Character of Payments
    36  
8.6 Calculation of Losses
    36  

 

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TABLE OF CONTENTS
(continued)
Page

         
8.7 Exclusive Remedy
    37  
ARTICLE IX TAX MATTERS
    37  
9.1 Cooperation on Tax Matters
    37  
9.2 Transfer Taxes
    37  
9.3 Allocation
    38  
ARTICLE X CONFIDENTIALITY
    38  
10.1 Confidential Information
    38  
10.2 Disclosure Required by Law
    39  
10.3 Duration of Confidentiality Obligations
    40  
10.4 Confidential Disclosure Agreement
    40  
ARTICLE XI MISCELLANEOUS
    40  
11.1 Expenses
    40  
11.2 Notices
    40  
11.3 Successors and Assigns; Assignment
    41  
11.4 Entire Agreement; Modification
    41  
11.5 Waivers
    41  
11.6 Section and Other Headings
    42  
11.7 Governing Law
    42  
11.8 Submission to Jurisdiction; Consent to Service of Process
    42  
11.9 Severability
    42  
11.10 No Third Party Beneficiaries
    42  
11.11 Construction
    42  
11.12 Counterparts
    42  
11.13 Incorporation of Schedules and Exhibits
    43  

 

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      Exhibits:    
 
   
Exhibit A
  Form of Assignment and Assumption Agreement
Exhibit B
  Form of Bill of Sale
Exhibit C-1
  Form of Buyer FDA Letter (NDA)
Exhibit C-2
  Form of Buyer FDA Letter (IND)
Exhibit D
  Form of General IP Assignment
Exhibit E
  Form of Patent Assignment
Exhibit F-1
  Form of Seller FDA Letter (NDA)
Exhibit F-2
  Form of Seller FDA Letter (IND)

      Schedules:    
 
   
Schedule 1.1
  Seller’s Knowledge
Schedule 2.1(a)(i)
  Assigned Patents
Schedule 2.1(b)
  Approvals
Schedule 2.1(c)
  Clinical Data
Schedule 2.1(e)(i)
  Specified Contracts
Schedule 2.1(e)(ii)
  Assigned Contract Rights
Schedule 2.1(f)
  Assigned Claims
Schedule 2.2(g)
  Excluded Contracts
Schedule 3.4(a)(v)
  Necessary Seller Consents
Schedule 4.3(b)
  No Violations; Consents
Schedule 4.4(b)
  Worldwide IP
Schedule 4.4(c)
  Royalties
Schedule 4.4(d)
  Filings & Payments
Schedule 4.6
  Good and Valid Title
Schedule 4.7
  Assigned Contracts
Schedule 4.8(a)
  Approvals; Compliance with Laws
Schedule 4.8(b)(i)
  Clinical Trials
Schedule 4.8(e)
  Approval Fees
Schedule 4.9
  Sufficiency of Assets and Rights
Schedule 5.3(b)
  Necessary Buyer Consents
Schedule 6.7
  Employees Subject to Non-Solicitation
Schedule 6.8(a)
  ROFN Assets
Schedule 7.1(e)(ii)
  Outstanding Requests and Orders