Document:

exv10w13

 

Exhibit 10.13

THIS AGREEMENT is dated as of the 23rd July 2001.

BETWEEN

(1) NEWSQUEST MEDIA GROUP LTD a company having its registered office at
Newspaper House, 34-44 London Road, Morden, Surrey SM4 5BR (the “Company”); and

(2) PAUL DAVIDSON (the “Executive”).

WHEREAS

The Executive is a director and is employed by the Company and it is desired to
regulate the terms of the Executive’s employment with the Company.

NOW IT IS HEREBY AGREED

1. JOB TITLE

The Company agrees to employ the Executive and the Executive agrees to act as
Chief Executive of the Company or in such other appointment as may from time to
time be agreed (the “Appointment”) and the Executive agrees to serve the
Company upon the terms set out in this Agreement.

The Executive will report to the President of Gannett Co., Inc.

2. PERIOD

(a) The Appointment shall commence on the date hereof and (subject
to the provisions for termination of this Agreement) shall
continue until terminated by either party giving to the other not
less than 12 months previous notice in writing to that effect.

(b) Notwithstanding the provisions of Sub-Clause 2(a) the
Appointment will terminate automatically when the Executive
reaches the age of sixty five.

(c) The Company may at its absolute discretion elect to terminate
the employment of the Executive with immediate effect by paying to
the Executive salary and an amount equal to the value of the other
benefits available to the Executive hereunder in lieu of notice.

3. DUTIES OF EXECUTIVE

During the continuance of the Appointment:

(a) The Executive shall devote the whole of his time, attention
and skill to the duties of his office and shall faithfully,
efficiently, competently and diligently perform such duties and
exercise such powers as may from time to time be assigned to or
vested in him and shall obey all reasonable and lawful directions
given to him by or under the authority of the

 

 

Board and use all reasonable endeavours to promote and extend the
Company’s business and to protect and further the interest and
reputation of the Company;

(b) the Company reserves the right to assign to the Executive
duties of a different nature to those which are consistent with
the job title set out in Clause 1 provided such duties are of an
equivalent or higher status to those consistent with the job title
set out in Clause 1;

(c) the Executive may be required in pursuance of his duties
hereunder to perform services not only for the Company but also
for any associated company for so long as the Company requires and
(without further remuneration) to accept such offices in any
associated company as the Company may from time to time reasonably
require and the Executive shall carry out such duties as if they
were duties to be performed by him on behalf of the Company and
the obligations contained herein shall apply mutatis mutandis as
if all references to “the Company” are references to the relevant
associated company;

(d) the Executive hereby agrees that the Company shall be entitled
from time to time without any further consent to second him to the
employment of any associated company but without prejudice to his
rights hereunder and the Executive shall carry out such duties as
if they were duties to be performed by him on behalf of the
Company and the obligations contained herein shall apply mutatis
mutandis as if all references to “the Company” are references to
the relevant associated company;

(e) the Executive hereby warrants to the Company that he shall
not, as a consequence of carrying out his duties hereunder, or
entering into this Agreement or other agreements or arrangements
made or to be made between the Company or any associated company
and him commit any breach of any terms express or implied (whether
concerning confidentiality, non-competition or otherwise) of any
contract with or of any other obligation to any third party
binding upon him;

(f) the Executive shall not during the term of this Agreement
(except with the prior consent in writing of the Board) be
directly or indirectly engaged or concerned in the conduct of any
other business which is wholly or partly in competition with any
business carried on by the Company or any associated company
whether by himself or in partnership with or as agent, employee or
representative of any third party nor shall he be directly or
indirectly interested in any such business save through his
holding or being interested in investments (quoted or unquoted)
not representing more than one per cent of the issued securities
of any class of any one company;

(g) the Executive shall, if called upon to do so and without any
further remuneration other than is herein mentioned, perform his
duties hereunder at premises in any part of the United Kingdom as
may be agreed between the Executive and the Company. If in
accordance with this sub-clause the Executive is required to
change his residence the Company will reimburse the Executive such
removal and other expense incidental to such change of residence
as the Company may consider fair and reasonable in the
circumstances together with the disturbance allowance in
accordance with the Company’s policy;

(h) the Executive shall at all times keep the Board promptly and
fully informed (in writing if so requested) of his conduct of the
business or affairs of the Company or any associated company and
provide such further information, written records and/or
explanation as the Board may reasonably require; and

 

 

(i) the Executive may be required in pursuance of his duties
hereunder to travel and stay on a temporary basis outside the
United Kingdom, but shall not, without his consent, be required to
reside outside the United Kingdom.

4. FURTHER OBLIGATIONS OF THE EXECUTIVE

(a) The Executive shall during the continuance of his employment
and for the period of 6 months after its termination comply (and
shall procure that his spouse or partner and his minor children
shall comply) with all applicable rules of law, New York Stock
Exchange regulations in respect of the stock of Gannett Co., Inc.,
and codes of conduct of the Company and any associated company for
the time being in force in relation to dealings in shares,
debentures or other securities of the Company or any associated
company or any unpublished price sensitive information affecting
the securities of any other company (provided that the Executive
shall be entitled to exercise any options granted to him under any
share option scheme established by the Company or any associated
company subject to the rules of any such scheme).

(b) The Executive shall in relation to any dealings in securities
of overseas companies comply with all laws of any foreign state
affecting dealings in the securities of such companies and all
regulations of any relevant stock exchanges on which such dealings
take place.

(c) During the continuance of his employment the Executive:

(i) shall not directly or indirectly procure accept
or obtain for his own benefit (or for the benefit of
any other person) any payment, rebate, discount,
commission, vouchers, gift entertainment, or other
benefit (“Gratuities”) from any third party in
respect of any business transacted or proposed to be
transacted (whether or not by him) or by or on
behalf of the Company or any associated company; and

(ii) shall observe the terms of any policy issued by
the Company in relation to Gratuities; and

(iii) shall immediately disclose and account to the
Company for any Gratuities received by him (or by
any other person on his behalf or at his
instruction).

5. SALARY AND OTHER BENEFITS

During the continuance of the Appointment:

(a) The Company shall pay to the Executive a salary at the rate of
TWO HUNDRED AND FIFTEEN THOUSAND POUNDS (GBP 215,000) per annum or
such rate as may from time to time be agreed by the Company, such
salary to be subject to review in January each year beginning
January 2003 (any adjustment not to be downwards) and shall be
inclusive of any other remuneration from the Company or any
associated company including, without prejudice to the above
generality, any fees receivable by the Executive as a Director of
the

 

 

Company or any associated company. The said salary (less tax and
statutory deductions) shall be payable to the Executive by equal
monthly payments two weeks in arrears on the fifteenth day of each
month and shall be deemed to accrue on a daily basis;

(b) The Executive shall during the continuance of his employment,
be entitled to be paid bonuses on achievement of or exceeding
performance levels set annually by the Remuneration Committee;

(c) The Company shall refund to the Executive, subject where
appropriate to the production of vouchers, all reasonable
out-of-pocket expenses properly incurred by him in the performance
of his duties including expenses of entertainment, subsistence and
travelling and where the Company issues a company sponsored credit
or charge card the Executive shall use such card only for those
expenses reimbursable in terms of this Sub-Clause 5(c) and the
Company reserves the right in its absolute discretion to withdraw
the use of such card(s) from the Executive at any time without
assigning any reason therefore;

(d) The Executive shall conform to such hours of work as may from
time to time reasonably be required of him in the performance of
his duties hereunder for the Company or any associated company and
shall not be entitled to receive any additional remuneration for
work outside the normal hours;

(e) The Executive shall be entitled without loss of remuneration
to 25 working days holiday in each holiday year of the Company
which is the calendar year (in addition to Bank and other public
holidays) to be taken at such time or times as the Company may
approve. The Executive shall not be entitled to carry forward any
annual holiday entitlement foregone by him for any reason during
the holiday year in which it accrued. Neither Saturday nor Sunday
shall be regarded as a working day. Upon the termination of his
employment the Executive’s entitlement to accrued holiday pay
shall be calculated on a pro rata basis in respect of each
completed month of service in the holiday year in which his
employment terminates and the appropriate amount shall be paid to
the Executive provided that if the Executive shall have taken more
days’ holiday than his accrued entitlement the Company is hereby
authorised to make an appropriate deduction from the Executive’s
final salary payment;

(f) Without prejudice to the Company’s rights under clause 9 below
during any period of absence from work due to sickness or accident
the Executive shall (after giving the Company when required
evidence satisfactory to it of incapacity and continuing
incapacity to work) be paid as follows:

Period of Service Duration of Benefit

Under 1 year 15 weeks in any period of 12 months

1 year but under 5 years 30 weeks in any period of 12 months

5 years and over 52 weeks in any period of 18 months

In each case there shall be deducted from the
Executive’s remuneration any statutory sick pay or
sick pay or social security benefits under which he
is entitled to claim in consequence of such sickness
or accident under the National Insurance scheme for
the time being in force (whether such income benefit
is

 

 

received or not) and/or any scheme for the time
being in force of which by virtue of his employment
with the Company he is a non-contributory member
provided that after the period of twelve months the
payment of salary shall be at the discretion of the
Company.

(g) subject to the rules for the time being applicable thereto the
Executive shall be entitled to continued membership of the
Enhanced Section of the Newsquest Pension Scheme (the “Scheme”).
Whilst the Executive continues in membership changes in the rules
of the Scheme will be notified in writing to the Executive within
one month and copies of the rules of the Scheme for the time being
in force will be made available to him for inspection on
application to the Secretary of the Company. The Company has
special arrangements for employees who are affected by the
earnings cap (introduced by the Finance Act 1989) and details of
the arrangements which apply to the Executive are contained in a
separate letter from the Company to the Executive;

(h) the Company shall provide the Executive, his spouse and his
unmarried children (if any) under the age of 21 (or under the age
of 25 if they are continuing in full time education) with
membership of a private health scheme without excess, or at the
discretion of the Board at an alternative private health scheme
providing similar benefits;

(i) the Company will maintain Director’s and Officer’s Liability
Insurance for the Executive during the course of his employment at
a level at which such insurance is normally maintained for
businesses of the size of the Company such insurance will cover
the Executive’s reasonable legal costs incurred by him in
defending any action brought against the Executive arising out of
the performance of his duties under this Agreement; and

(j) If the Executive’s employment under this Agreement is
terminated by reason of redundancy (as defined by section 139 of
the Employment Rights Act 1996) the Executive will be entitled to
receive a redundancy payment equal to one month’s basic salary (as
referred to in Clause 5(a)
above) for every year that he has been employed by the Company or
in any employment in respect of which his employment with the
Company is continuous, up to a maximum of 12 months salary (as
aforesaid) such payment to be in addition to any other entitlement
of the Executive arising out of the termination of his employment
under this Agreement.

6. MOTOR CAR

For the purpose of enabling the Executive properly to perform his duties
hereunder the Company shall provide him with the use of a motor car of a make,
model and specification compatible with his status in the Company in accordance
with the Company’s car policy from time to time and shall defray the insurance
costs and all running costs. The Executive will pay all petrol costs and be
refunded on an agreed scale for all business mileage. The Executive shall,
except at such times as the vehicle is by arrangement with the Company, out
with the Executive’s custody and control, be responsible for ensuring that such
vehicle is at all times in the state and condition required by law and that
(where applicable) a test certificate in relation thereto is in force and for
ensuring that he holds a valid United Kingdom drivers licence at all times
which shall be produced to the Company on demand. The Executive will be
required at all times to conform with the Company’s regulations regarding the
provision of motor vehicles and in particular shall procure that the insurance
cover relating to the vehicle provided is not prejudiced or avoided.

 

 

7. NON-DISCLOSURE OF CONFIDENTIAL INFORMATION

(a) The Executive shall not directly or indirectly divulge or
communicate to any person (other than those within the employment
of the Company whose province it is to know the same or with the
prior written authority of the Company or as otherwise required by
law) nor shall he make use of (otherwise than for the purposes of
performing his duties hereunder) any of the trade secrets,
designs, techniques, design improvements, know-how, business
information, methods, lists or other confidential information of
the Company or of any associated company or of their respective
customers which he may (whether heretofore or hereafter) have
received or obtained while in the service of the Company or any
associated company is bound by an obligation of confidentiality to
a third party (“Confidential Information”). This restriction shall
continue to apply after the termination of the Appointment.

(b) The Executive shall use his best endeavours to prevent the
publication or disclosure of any Confidential Information whether
relating to trade dealings, financial affairs or otherwise.

(c) The restrictions contained in this Clause 7 shall cease to
apply to any Confidential Information which may (otherwise than by
reason of the default of the Executive) become available to the
public generally.

(d) The Executive shall not during the continuation of the
Appointment make (otherwise than for the benefit of the Company or
any associated company) any notes, memoranda, tape recordings,
films, photographs, plans, drawings or any form of record relating
to any matter within the scope of the business of the Company or
any associated company or concerning any of the dealings or
affairs of the Company or any associated company (“the Company
Records”).

(e) The provisions of this Clause 7 shall apply mutatis mutandis
to any secret information or Confidential Information the
Executive may have received or obtained while in the employment of
any associated company or of any company to which the Executive
has been seconded in terms of Sub-Clause 3(c) hereof as if all
references to “the Company” are references to the relevant
associated company or company to which the Executive is seconded.

8. INVENTIONS

In view of the fact that the business of the Company and of its associated
companies consists in part of the development and exploitation of inventions,
techniques and methods and that it is the Executive’s responsibility to further
the interests of the Company and its associated companies in respect thereof he
agrees that each and every discovers, invention, improvement, design and secret
process made or discovered by him (whether alone or with any other person or
persons) at any time whether before or after the date hereof but after he
became an employee of the Company whether capable of being patented or
registered or not (and whether or not made or discovered in the course of his
employment hereunder) in connection with or in any way affecting or relating to
the business of the Company or of any associated company or capable of being
used or adapted for use therein or in connection therewith shall forthwith be
disclosed to the Company and shall belong to and be the absolute property of
the Company or such associated company as the Company may nominate for the
purpose. If and whenever

 

 

required so to do (whether during or after the termination of the Appointment)
the Executive shall at the expense of the Company apply or join in or appoint
the Company as his agent with full powers for the purposes of applying for
letters patent or other equivalent protection in the United Kingdom or any
other part of the world for any such discovery, invention, improvement, design
and secret process as aforesaid and execute all instruments and do all things
necessary for vesting the said letters patent or other equivalent protection
when obtained and all right, title and interest to and in the same in the
Company (or its nominees) absolutely and as sole beneficial owner or in such
other person as the Company may require; provided always that nothing herein
shall prejudice the rights of the Executive as contained in Sections 40 to 43
of the Patents Act 1977 as
amended by the Copyright, Designs and Patents Act 1988. The Company hereby
undertakes to indemnify the Executive for all liabilities arising out of the
unauthorised use of the power of attorney granted pursuant to this clause.

9. TERMINATION

(a) Without in any way limiting any rights of the Company this
Agreement shall be subject to termination by the Company forthwith
without notice or payment in lieu of notice:

(i) if the Executive shall have committed any
serious or material breach (whether by one or
several acts or omissions) of his obligations
hereunder; or

(ii) if the Executive shall have repeated or
continued any breach of his obligations hereunder
after he has at any time received written warning
from the Company in respect of such breach; or

(iii) if the Executive shall have been found guilty
of any criminal offence (other than under the Road
Traffic Acts from time to time in force which does
not involve a custodial sentence and other than in
relation to any criminal offence committed by the
Executive as a consequence of the publication of any
matter in a newspaper, magazine or periodical
published by the Company or any associated company
which has not knowingly been cleared by the
Executive and in circumstances where no personal
blame is attributed to the Executive); or

(iv) shall have become insolvent or shall have
compounded with or granted a trust deed for his
creditors (or their respective equivalents in any
jurisdiction); or

(v) if the Executive is guilty of conduct which
brings the Company or any associated company into
disrepute;

(vi) if the Executive is or becomes prohibited by
law from being a director; or

(vii) if the Executive voluntarily resigns as a
director of the Company except at the request of the
Company.

(b) If the Company has any grounds to believe it may have right to
terminate the Appointment of the Executive pursuant to Sub-Clause
(a) above, it shall be entitled (but without prejudice to its right
subsequently to terminate the Appointment on the same or any other
ground) to suspend the Executive on full pay during the period of
any enquiry or

 

 

investigation into the circumstances giving rise to such belief.

(c) Without prejudice to the rights of the Executive to
remuneration and other benefits hereunder and to the rights of the
Company hereunder including, without prejudice to the foregoing
generality, Sub-Clause 9(b) and Clause 7, the Company shall have
the right at any time after either party has given notice to the
other of termination of this Agreement in accordance with the
terms of Clause 2 hereof until such termination to require the
Executive not to attend at any place of work and to exclude him
from any premises of the Company (or any associated company in
relation to which the Executive held a position of responsibility
at any time during the twelve months immediately prior to the date
on which notice is served pursuant to Clause 2(a). For so long as
the Company exercises its rights under this Clause the Company
shall be under no obligation to vest in or assign to the Executive
any powers or duties or to provide any work for the Executive and
shall have the right to suspend him from the performance of any
duties or obligations hereunder. The rights of the Company
pursuant to this Sub-Clause 9(c) shall not be exercised for a
period exceeding six months in aggregate. Without prejudice to the
right of the Executive to remuneration and other benefits
hereunder the Executive shall, at the request of the Company,
resign without claim for compensation from any office of Director
or otherwise held by him in the Company or in any associated
company.

(d) In the event the Company terminates this Agreement for any
reason set forth in Clause 9(a), the Executive shall not be
entitled to receive any bonus (to the extent unpaid) that would
otherwise have been payable to him.

10. PROVISIONS ON TERMINATION

(a) On the termination of the Appointment (which term, for the
purposes of the Agreement as a whole, shall mean termination of
the Appointment irrespective of the cause or manner, including,
for the avoidance of doubt, by reason of a repudiatory breach of
the Agreement by the Company) or any time thereafter the Executive
shall without prejudice to the rights of the Executive to
remuneration and other benefits hereunder at the request of the
Company resign without claim for compensation from any office of
Director or otherwise held by him in the Company or in any
associated company and transfer without payment to the Company any
shares held by the Executive as a nominee on behalf of the Company
or any associated company.

(b) All drawings, designs, photographs, plans, models,
blue-prints, reports, manuals, files, notes, accounts, documents
or other material and all notes and memoranda of any trade secrets
of the Company or of any associated company or any Confidential
Information and Company records (including copies thereof) or keys
and other property of or relation to the Company or its associated
companies as shall have been made or received by the Executive
during the course of his employment (whether heretofore or
hereafter) are and shall be the property of the Company and shall,
together with any company sponsored credit or charge cards, be
surrendered by him to someone duly authorised by the Company upon
the termination of the Appointment or the suspension of the
Appointment in accordance with Sub-Clause 9(b) or at the request
of the Board at any time during the course of his employment
hereunder.

11. NON-COMPETITION

 

 

(a) In this Clause the expression “the Relevant Date” means the
first to occur of:

(i) The date on which this Agreement shall lawfully
determine; or

(ii) The date upon which the Executive is required
no longer to perform executive duties pursuant to
Sub-Clause 9(c).

(b) Since the Executive has obtained and is likely to obtain in
the course of his employment with the Company and any associated
company knowledge or trade secrets, designs, design improvements,
know-how, techniques, methods, lists and other confidential
information relating to the Company and any associated company and
also to their respective customers he hereby agrees that in
addition to the restrictions contained in Clause 7 of this
Agreement he will be bound by the following restrictions namely:

(i) He will not during the currency of his
employment and for the period of 12 months from the
Relevant Date entice or solicit or endeavor to
entice or solicit away from the Company (or any
associated company in relation to which the
Executive held a position of responsibility at any
time during the 12 months immediately prior to the
Relevant Date) or have business dealings with or
accept business from any person, firm, company or
organisation who or which is or has been a customer
of the Company or such associated company as the
case may be and with whom the
Executive has dealt and which business is of the
kind which is undertaken by the Company or such
associated company and has been so undertaken by the
Company or such associated company and has been so
undertaken for or on behalf of that person, firm,
company or organisation at any time during the 12
months immediately prior to the Relevant Date;

(ii) he will not, without the consent of the
Company, during the currency of his employment and
for the period of 12 months from the Relevant Date
be directly or indirectly interested or concerned in
any business carried on or about to be carried on by
any person , firm, company or organisation in
competition with the Company (or any associated
company in which he held a position of
responsibility at any time during the 12 months
immediately prior to the Relevant Date) within the
United Kingdom; provided always that this
restriction shall not operate so as to prohibit any
employment none of the duties of which relate or
would relate to the sale of any goods or provisions
of any services of a kind which the Executive shall
during the course of his employment with the Company
or such associated company have been involved in
selling or providing in his capacity as an employee
of the Company or any associated company;

(iii) he will not at any time whether before or
after the Relevant Date interfere or seek to
interfere with the supply to the Company (or to any
associated company in which he has held a position
of responsibility in the 12 months immediately prior
to the Relevant Date) of any goods or services by
any supplier who during the 12 months preceding such
time shall have supplied goods or services to the
Company or to any associated company nor will he
interfere or seek to interfere with the continuance
of such supply or the terms on which supply has
during such period as aforesaid been made.

 

 

(c) Since he has obtained and is likely to obtain in the course of
his employment with the Company the confidence of and influence
over the employees of the Company and, in particular, both a
knowledge of and the confidence of and influence over those
employees of particular importance to the Company due to their key
skills and responsible positions, and in recognition that the
Company has an interest in preserving its connection with such key
employees, the Executive hereby agrees that in the event of
his Appointment being lawfully terminated he will not during the
currency of his employment and for the period of 12 months from
the Relevant Date directly or indirectly entice, solicit or
endeavour to entice or solicit away from the Company or any
associated company any person who was a director, or senior
employee reporting direct to any executive director of the Company
or any associated company at any time during the period of his
Appointment and who was engaged in the area of business in which
the Executive was engaged at any time during the period of his
Appointment or with whom the Executive otherwise had a material
degree of contact in the course of the Appointment.

(d) The restrictions set out in Sub-Clauses (b) and (c) above
shall apply to any action taken by the Executive whether as agent,
representative, principal, employee or consultant or as a director
of any company.

(e) The Executive acknowledges and agrees that each of paragraphs
(i) to (iii) of Sub-Clause (b) and Sub-Clause (c) of this Clause
11 constitutes an entirely separate and independent restriction on
him and that the duration, extent and application of each of the
restrictions are no greater than is necessary for the protection
of the interests of the Company and its association companies.

12. AUTHORITY OF THE COMPANY

The Executive hereby irrevocably appoints the Company to be his authorised
attorney to do all such things and to execute all such documents in his name
and on his behalf as may be necessary to secure that the full benefit and
advantage of the rights arising under Clause 8 and sub-Clauses 10(a) and (b)
hereof are obtained by the Company (or where appropriate its nominee) and a
letter signed by any Director or Secretary of the Company certifying that
anything or any document has been done or executed within the authority hereby
conferred shall be conclusive evidence of the same. The Company hereby
undertakes to indemnify the Executive for all liabilities arising out of the
unauthorised use of the power of attorney granted pursuant to this Clause.

13. DEFINITIONS

In this Agreement words and phrases defined in Section 736 of the Companies Act
1985 (as amended) shall bear the same meaning and the expression “Board” means
the Directors of the Company present at a meeting of the Directors or of a
Committee of the Directors duly convened and held; “Remuneration Committee”
shall be comprised of the President and Chief Financial Officer of Gannett Co.,
Inc., either of whom shall have the authority to act on behalf of the
Remuneration Committee; and the expression “associated company” means any
company which from time to time is (i) a company having an ordinary share
capital of which not less than 50 per cent is owned directly or indirectly by
the Company or (ii) a holding company of the Company or any subsidiary of any
such holding company and the provisions of Section 840 of the Income and
Corporation Taxes Act 1988 shall apply in determining the question of control
for any purpose.

 

 

14. NOTICES

Notices may be given by either party by first class prepaid recorded delivery
letter or by facsimile transmission addressed to the other, or by delivery at
(in the case of a notice to the Company) at its registered office for the time
being and (in the case of a notice to the Executive) his last known address and
in the case of a letter shall be deemed to have been given 48 hours after
posting and in the case of facsimile transmission or delivery shall be deemed
to have been at 9:00 a.m. on the business day following transmission or
delivery as the case may be (provided that a copy of any facsimile transmission
is posted to the recipient of the facsimile in the manner set out herein on or
prior to the business day next following the date of the transmission).

15. EMPLOYMENT RIGHTS ACT

The information contained herein and in the Schedule hereto constitutes a
written statement of the terms of the Executive’s employment in compliance with
the provisions of the Employment Rights Act 1996.

16. ENTIRE AGREEMENT

This Agreement contains the entire understanding between the parties and is in
substitution for all previous contracts, service agreements, arrangements, and
understandings relating to the employment of the Executive (written or oral)
between the Company or any associated company and the Executive which shall be
deemed to have been terminated by mutual consent as from the date on which this
Agreement is deemed to have commenced. The Executive acknowledges that he has
not entered into this Agreement in reliance on any warranty, representation or
undertaking which is not contained in or specifically incorporated in this
Agreement. The Executive acknowledges that he has no claim against the Company
or any associated company (or against any of their respective assets) arising
under or out of any such contract or arrangement other than for accrued salary.

17. PROPER LAW

This Agreement shall be governed by and construed in accordance with the Law of
England and the parties to this Agreement hereby submit to the exclusive
jurisdiction of the English courts.

IN WITNESS WHEREOF these presents are executed in the manner and on the date
hereinafter appearing:

SIGNED on behalf of

NEWSQUEST MEDIA GROUP LIMITED

by

/s/Paul Davidson          

Director

/s/Paul Hunter          

Director

SIGNED and delivered as a DEED

by the said PAUL DAVIDSON

in the presence of:

/s/D.C. Lowe          

Witness

Diane Christine Lowe          

Full Name

Secretary          

Occupationexv10w34

 

Exhibit 10.34

REAL ESTATE PURCHASE AGREEMENT

REAL ESTATE PURCHASE
AGREEMENT

THIS REAL ESTATE PURCHASE AGREEMENT (“Agreement”) is made and entered into this
31st day of October, 2003 (the “Effective Date”), by and between UNITHER
PHARMACEUTICALS, INC., a Delaware corporation (“Purchaser”), and MONTGOMERY
COUNTY, a political subdivision of the State of Maryland (“Seller”) (Seller and
Purchaser, collectively, the “Parties”).

1. DESCRIPTION OF PROPERTY. Subject to the terms and conditions of this
Agreement, Seller hereby agrees to sell, assign and convey, and Purchaser
hereby agrees to purchase, that certain approximately 0.92-acre parcel of real
property situate in Silver Spring, Montgomery County, Maryland, as more
particularly described in Exhibit A attached hereto, together with the
easements, rights, privileges and appurtenances thereto belonging (including
without limitation all rights attributable to previous dedications of portion
of the Property for use as public rights of way) (the “Property”).

2. PURCHASE PRICE. The purchase price of the Property is TWO MILLION EIGHT
HUNDRED EIGHTY THOUSAND AND NO/100 DOLLARS ($2,880,000.00) (hereinafter
referred to as the “Purchase Price”).

3. PURCHASE DEPOSIT.

     (a) Within three (3) business days after the execution and delivery of
this Agreement by the Parties, Purchaser shall deposit with Arthur Konopka Law
Offices, 4530 Wisconsin Avenue, N.W., Suite 300, Washington, D.C. 20016 Attn.
Arthur Konopka, Esq. (“Escrow Agent”), agent for Lawyers Title Insurance
Corporation (the “Title Company”), the sum of Eighty Thousand and No/100
Dollars ($80,000.00) (the “Initial Deposit”).

     (b) Within three (3) business days after the expiration of the Inspection
Period (as hereinafter defined), and provided Purchaser has not terminated this
Agreement as set forth in paragraph 5 below, Purchaser shall deposit with
Escrow Agent the sum of Two Million Seven Hundred Thousand and No/100 Dollars
($2,700,000.00) (the “Second Deposit”).

     (c) The Initial Deposit and the Second Deposit are hereinafter
collectively referred to as the “Purchase Deposit,” which term shall include
all interest accrued thereon. The Purchase Deposit shall be held by Escrow
Agent in one or more interest-bearing federally insured accounts with a
financial institution reasonably acceptable to Purchaser and Seller. Interest
on the Purchase Deposit shall accrue for the benefit of Purchaser.

4. PAYMENT OF PURCHASE PRICE. Purchaser agrees to pay to Seller the Purchase
Price at the Closing (hereinafter defined) of which the Purchase Deposit shall
constitute a part. The Purchase Price shall be paid in cash, certified funds
or by electronic wire transfer at the Closing.

5. CONTINGENCIES. This Agreement is contingent upon the following:

     A. Inspection. Purchaser shall have until 5:00 PM (Eastern time) on
December 15, 2003, to inspect the condition of the Property (the “Inspection
Period”), and if the Property does not meet Purchaser’s satisfaction in its
sole and absolute discretion, Purchaser shall be permitted to terminate this
Agreement, by written notice to Seller received no later than such date and,
upon termination of this Agreement, the Initial Deposit shall be promptly
refunded and paid over to Purchaser and neither Party shall have any further
liability to the other under this Agreement, except as expressly provided for
by the terms of this Agreement.

     B. Environmental Inspection. Purchaser shall have until 5:00 PM (Eastern
time) on December 15, 2003, to conduct an environmental inspection and/or audit
of the Property. In the event the inspection or audit reveals certain
conditions which require the expenditure of any sums to bring the Property into
compliance with all existing Federal and State of Maryland environmental laws,
statutes, regulations or ordinances, Purchaser shall be permitted to terminate
this Agreement by written notice to Seller received no later than December 15,
2003, and, upon termination of this Agreement, the Initial
Deposit shall be promptly refunded and paid over to Purchaser and neither
Party shall have any further liability to the other under this Agreement,
except as expressly provided for by the terms of this Agreement. Under no
circumstances will the

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Seller be obligated to the Purchaser to remediate or
otherwise abate or correct any environmental condition at the Property.
Subject to the right of Purchaser in paragraph 10 below to terminate this
Agreement upon the occurrence of an Environmental Event (as hereinafter
defined), Purchaser agrees that it will be responsible for any remediation,
abatement or corrective action that is required on the Property after Closing,
even if the condition existed prior to Closing.

     C. Right of Entry. During the pendency of this Agreement, Purchaser and
its representatives, consultants and contractors may enter upon the Property
upon reasonable notice to make such inspections and tests regarding the
Property as Purchaser deems necessary or desirable, including without
limitation investigations of zoning and topographic suitability to Purchaser’s
intended use, soil boring studies, environmental inspections, audits or tests
(including soil borings and such “Phase 2” testing as may be necessary), and
the location of public facilities and utilities for the Property (including the
relocation of the Public Facilities, as hereafter defined). Purchaser and
Seller have executed the Right of Entry Agreement, a copy of which is attached
hereto as Exhibit B attached hereto. The Right of Entry Agreement shall not be
merged into this Agreement and termination of this Agreement shall not
constitute a termination of the Right of Entry Agreement.

     D. Relocation of Public Facilities.

          (1) Certain stormwater management facilities (including stormwater drains,
an oil/grit separator and related facilities) and related facilities
(collectively, the “Public Facilities”) are currently located on the Property.
Development of the Property for the use desired by Purchaser will necessitate
the relocation of the Public Facilities. During the Inspection Period,
Purchaser shall have the right to determine in its sole discretion whether the
Public Facilities can be re-located on the Property such that the Property may
be developed as Purchaser desires. If Purchaser shall determine in its sole
discretion that the Public Facilities cannot be relocated on the Property such
that the Property may be developed as Purchaser desires, or if Seller shall
fail to provide the Seller’s Relocation Approval (as hereinafter defined) prior
to the Closing Date, Purchaser shall be permitted to terminate this Agreement
by written notice to Seller received prior to the Closing Date and, upon
termination of this Agreement, the Purchase Deposit shall be promptly refunded
and paid over to Purchaser and neither Party shall have any further liability
to the other under this Agreement, except as expressly provided for by the
terms of this Agreement. Seller (acting solely in its role as the
owner/operator of the parking garage owned by Seller and located adjacent to
the Property (the “Adjacent Garage”)), shall have the right to approve the
proposed location of the Public Facilities solely for the purposes of
determining whether said location, in comparison with the Public Facilities in
their current location, would adversely impact the costs to the Seller of
operating, maintaining, repairing and/or replacing the Public Facilities or
would impair the functionality and effectiveness of the Public Facilities (said
approval, the “Seller’s Relocation Approval”). Nothing herein shall limit
Purchaser’s obligation to obtain approvals from Seller acting in its
governmental regulatory capacity (or in its capacity as owner of any land other
the Property upon which the Public Facilities are proposed to be located) as to
the relocation of the Public Facilities to the extent such approvals are
required by applicable law.

          (2) If Purchaser determines in its sole discretion that the Public
Facilities can be relocated on the Property to the location approved by
Seller’s Relocation Approval such that the Property may be developed as
Purchaser desires (i.e. Purchaser elects not to terminate this Agreement as
provided in subparagraph (1) above) and if Seller provides the Seller’s
Relocation Approval, Purchaser shall be responsible for performing all work as
may be necessary to relocate the Public Facilities. Purchaser shall also be
responsible for obtaining permits and approvals, including any NPDES approvals
requires for the relocation of the Public Facilities. The design and
specifications of the relocated Public Facilities shall be subject to approval
by Seller (said approval not to be unreasonably withheld, conditioned or
delayed), but in no event, other than as may be necessary to maintain no less
than the same water quality and quantity management function for the Adjacent
Garage as the Public Facilities served prior to relocation, shall Seller have
the right to require Purchaser to provide Public Facilities which exceed in
design and specifications (including with respect to capacity and size) the
Public Facilities as are in place prior to relocation. The work related to the
relocation of the Public Facilities shall be performed by Purchaser in
conjunction with Purchaser’s development of the Property. At Closing, Seller
shall deposit into an escrow account to be held by Escrow Agent the sum of
Three Hundred Thousand and No/100 Dollars ($300,000.00) (the “Relocation
Escrow”). The terms and conditions of the Relocation Escrow and the conditions
for disbursement therefrom are set forth in that certain Relocation Escrow
Agreement (the form of which is attached hereto as Exhibit C) to be executed
and delivered by Seller, Purchaser and Escrow Agent at Closing. The provisions
of the Relocation Escrow Agreement which shall govern any conflict with the
provisions of this subparagraph (2). Purchaser also have the right, at its
expense, to relocate any sanitary sewer lines on the Property that interfere
with Purchaser’s desired development of the Property and, with respect to any
sanitary sewer line that serves the Adjacent Garage, the proposed location of
the relocated sanitary sewer line shall be subject to the Seller’s approval,
which approval will not be unreasonably withheld, delayed or conditioned;
provided, however, that Seller shall approve to the proposed location if the
relocated sanitary sewer line, upon relocation, shall have at least the same
degree of functionality and accessibility as the sanitary sewer line had in its
original location .

     E. Waiver of Subdivision Regulations. On September 25, 2003, in
accordance with the opinion dated October    , 2003, the Montgomery County
Planning Board of the Maryland-National Capital Park and Planning Commission
(the “Planning Board”) approved the request for a waiver of certain Subdivision
Regulations (the “Subdivision Waiver Approval”), such request having been made
by that certain letter dated August 28, 2003, from Seller to the Planning
Board. If any appeal of the Subdivision Waiver Approval shall be filed within
any applicable appeal period and said appeal shall not have been be

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finally
resolved prior to Closing such that on the Closing Date the original
Subdivision Waiver Approval has not been affirmed without possibility of future
appeal, Purchaser shall have the right to terminate this Agreement by providing
written notice to Seller on or prior to Closing and, upon termination of this
Agreement, the Purchase Deposit shall be promptly refunded and paid over to
Purchaser and neither Party shall have any further liability to the other under
this Agreement, except as expressly provided for by the terms of this
Agreement.

6. REPRESENTATIONS, WARRANTIES AND COVENANTS OF SELLER. Seller hereby
represents, warrants and covenants to Purchaser, all of which are true as of
the date hereof and shall be deemed to be remade by Seller to Purchaser as of
the Closing Date (hereinafter defined) and shall survive the Closing
(hereinafter defined).

     A. Seller’s Authority. The Seller is a political subdivision of the State
of Maryland and has the lawful power and authority to enter into and carry out
the terms of this Agreement. The execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated hereby, have
been duly authorized and approved, and this Agreement, the Deed, the Right of
Entry Agreement, the Relocation Escrow Agreement, the Easement Agreement, the
Restrictive Covenant and Repurchase Agreement, and the Parking License
Agreement, in the forms as attached as exhibits to this Agreement, each will
constitute a valid and binding agreement of the Seller, enforceable in
accordance with its terms.

     B. No Violation. Neither the execution and delivery of this Agreement by
the Seller, nor the consummation by the Seller of the transactions contemplated
hereby, will to the Seller’s actual knowledge constitute a violation of any
applicable judgment, decree or order or, to the Seller’s actual knowledge, any
applicable code, resolution, law, statute, regulation, ordinance or rule.

     C. No Government Proceedings. There are no existing, pending, nor to
Seller’s actual knowledge any contemplated or threatened, condemnation,
incorporation, annexation or moratorium proceedings affecting the Property (or
any portion thereof).

     D. No Other Agreements. Seller owns fee title to the Property and the
Property is not subject to any liens or encumbrances other than as may be
determined upon examination of the title to the property in the Land Records
for Montgomery County. Seller has not entered into any other contracts for the
sale of the Property, and no party has a right of first refusal or option to
purchase all or a portion of the Property.

     If Seller becomes aware of the fact that any representation or warranty
contained in this Agreement should become materially untrue or incorrect at or
before the Closing (hereinafter defined), Seller shall notify Purchaser of such
condition and Purchaser may (i) waive such condition and close, or (ii)
terminate this Agreement, whereupon the Purchase Deposit shall be refunded to
Purchaser and no party hereto shall have any further rights, claims or
liabilities hereunder, except as expressly provided for by the terms of this
Agreement.

7. TITLE AND SETTLEMENT.

     A. Title. Within ten (10) business days after the Effective Date,
Purchaser shall (i) order from the Escrow Agent a commitment for title
insurance (the “Commitment”) accompanied by copies of all recorded documents
relating to liens, encumbrances, plats, easements, rights of way, restrictions,
covenants, ground leases and conditions affecting the Property, in such form as
may be required by Purchaser, and (ii) order an ALTA/ACSM land title survey of
the Property (the “Survey”). Within twenty (20) days after receipt of the
Commitment, copies of all special exceptions identified therein, and the
Survey, Purchaser shall notify Seller in writing (“Purchaser’s Objection
Notice”) specifying any title matter, exceptions or survey matter to which it
objects (any exceptions or title or survey matter to which Purchaser does not
object shall be “Permitted Exceptions”). Within ten (10) business days after
receipt of Purchaser’s Objection Notice, Seller shall provide Purchaser written
notice (“Seller’s Cure Notice”) of which objections set forth in Purchaser’s
Objection Notice that Seller will cure prior to the Closing; provided, however,
that Seller shall not be required to expend any sum of money to cure any such
objections. In the event Seller states in its Seller’s Cure Notice that Seller
is unable or unwilling to eliminate or modify any objection raised in
Purchaser’s Objection Notice, Purchaser may (i) terminate this Agreement by
written notice to Seller whereupon the Purchase Deposit shall be refunded to
Purchaser and no party shall have any further rights, claims or liabilities
hereunder, except as expressly provided for by the terms of this Agreement, or (ii)
accept such title as Seller can deliver.

     B. Date of Settlement. The closing shall occur on the earlier to occur of
the following (the “Closing” or the “Closing Date”): (i) such date after the
Effective Date that is set forth on a written notice by Purchaser to Seller
stating that Purchaser is ready to proceed to Closing (Closing to occur no
sooner than ten (10) days after the date of such notice), or (ii) December 15,
2004, or (iii) on such other date as the Parties may agree. Seller and
Purchaser agree to make full settlement in accordance with the terms hereof on
the Closing Date.

     C. Place of Settlement. The Closing shall take place at the offices of
the Escrow Agent. The Purchase Deposit shall be held by the Escrow Agent in
escrow pursuant to the terms and conditions of this Agreement.

     D. Payment of Settlement Costs. Purchaser agrees to pay at the Closing
the settlement charges in connection with the examination of title, the Survey,
the cost of the preparation and recordation of any mortgage instruments and any

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document recording expenses. Seller shall pay the cost to satisfy any deeds of
trust, mortgages, judgments or other monetary liens upon the Property that
Seller has agreed to discharge prior to Closing and provide releases with
respect thereto. Purchaser shall also pay recording costs and fees with
respect to the Deed (as hereinafter defined), any recordation, transfer and
other taxes imposed on the Deed by the State of Maryland and/or Montgomery
County (including Agricultural Transfer Taxes, if any), and all other costs of
Closing. Seller and Purchaser hereby covenant and agree with each other that
no real estate commissions, finder’s fees or broker’s fees have been or will be
incurred in connection with this Agreement or the transactions contemplated
herein. Each party shall indemnify and hold harmless the other from and
against any costs or liability arising from the claim of a broker or agent
claiming through such party.

     E. Taking Title. The Property is to be conveyed in the name of Purchaser
or such other entity or individual as designated by Purchaser. Seller agrees
to execute and deliver the Deed at the Closing; said Deed shall convey good,
marketable and insurable title to the Property to Purchaser, subject to the
Permitted Exceptions.

     F. Adjustments. Taxes, water rents, and all utility and other operating
expenses of the Property are to be adjusted as of the date of the Closing.

     G. Closing.

          (1) Seller’s Deliveries. On the Closing Date, Seller shall deliver to
Escrow Agent two (2) original counterparts of the following documents, fully
executed and acknowledged where appropriate, and such other items as follows:

               (a) Deed. A special warranty deed executed by Seller in the form attached
hereto as Exhibit D conveying Seller’s title to the Property to Purchaser, or
any nominee or assignee of Purchaser, subject only to the Permitted Exceptions
(the “Deed”); and

               (b) Owner’s Affidavit. An owner’s affidavit as to mechanic’s liens and
parties in possession in form and substance reasonably acceptable to Seller and
as may be reasonably required by the Title Company to issue the Title Policy
(as hereinafter defined);

               (c) Non-Foreign Certificate. If required of a political subdivision, as
affidavit executed by Seller in form and substance reasonable acceptable to the
Seller certifying that Seller is not a “foreign person” as defined in Section
1445 of the Internal Revenue Code or any related regulations, as amended;

               (d) Relocation Escrow Agreement. A Relocation Escrow Agreement executed
by Seller and in form attached hereto as Exhibit C (the “Relocation Escrow
Agreement”);

               (e) Easement Agreement. An Easement Agreement executed by Seller in the
form contemplated by paragraph 13F below (the “Easement Agreement”);

               (f) Restrictive Covenant and Repurchase Agreement. A Restrictive Covenant
and Repurchase Agreement executed by Seller and in form attached hereto as
Exhibit E (the “Restrictive Covenant and Repurchase Agreement”); and

               (g) Release of Memorandum of Real Estate Purchase Agreement. A release of
the Memorandum of Real Estate Purchase Agreement executed by Seller in
recordable form and in substance effective to release the Memorandum of Contact
(as hereinafter defined) of record (the “Release of Memorandum”).

          (2) Purchaser’s Deliveries.

               (a) Purchase Price. On or prior to the Closing Date, Purchaser shall
deliver to Escrow Agent a certified check or wire transfer in an amount equal
to the Purchase Price, less the Purchase Deposit and any prorations or other
adjustments provided for herein;

               (b) Relocation Escrow Agreement. The Relocation Escrow Agreement executed
by Purchaser;

               (c) Easement Agreement. The Easement Agreement executed by Purchaser;

               (d) Restrictive Covenant and Repurchase Agreement. The Restrictive
Covenant and Repurchase Agreement executed by Purchaser; and

                    (g) Release of Memorandum of Real Estate Purchase Agreement. The Release
of the Memorandum executed by Purchaser.

8. REPRESENTATIONS, WARRANTIES AND CONDITIONS TO PURCHASER’S OBLIGATIONS.

     A. Representations and Warranties of Purchaser:

     Due Organization and Good Standing. The Purchaser is a corporation duly
organized and validly existing and in good standing under the laws of Delaware
and is duly qualified to enter into this Agreement and undertake the
obligations provided for herein.

     Purchaser’s Authority. The Purchaser has the full and unrestricted lawful
power and authority to enter into and carry out the terms of this Agreement.
The execution, delivery and performance of this Agreement and the consummation
of the transactions contemplated hereby have been or will be as of the Closing
Date, duly authorized and approved by all requisite action, as the case may be,
and this Agreement, when duly executed and delivered, will constitute a valid
and binding

4

 

agreement of the Purchaser, enforceable in accordance with its
terms.

     No Conflict. Neither the execution or delivery of this Agreement, nor the
consummation of the transactions contemplated hereby, will: (i) conflict with,
or result in a breach of, the terms, conditions or provisions of, or constitute
a default under Purchaser’s articles of incorporation or bylaws or any
agreement or instrument to which Purchaser is a party or is subject; (ii)
violate any agreement, restriction, easement, restrictive covenant, or
instrument to which Purchaser is a party or to which Purchaser is subject; or,
(iii) to Purchaser’s knowledge, constitute a violation of any applicable code,
resolution, law, statute, regulation, ordinance, rule, judgment, decree or
order applicable to Purchaser.

     No Violation. There are no actions, suits, proceedings or investigations
pending or, to the knowledge of the Purchaser, threatened against or affecting
the Purchaser which question the validity of this Agreement, at law or in
equity, before or by any federal, state, municipal or other governmental
department, commission, board, bureau, agency or instrumentality.

     B. Conditions of Purchaser’s Obligation to Close. The obligation of
Purchaser to consummate the conveyance of the Property hereunder is subject to
the satisfaction of each of the following conditions precedent (any of which
may be waived in whole or in part by the Purchaser at or prior to the Closing):

          (1) The representations and warranties of Seller contained in this
Agreement shall be true, complete and accurate, and all covenants and other
agreements of Seller shall have been performed or observed, on and as of the
date hereof and the Closing Date as if the same were made on and as of such
date.

          (2) The Title Company shall be irrevocably committed to insure Purchaser
on the Closing Date as the
fee owner of the Property in the amount of the Purchase Price by issuance
of an ALTA owner’s title insurance policy (the “Title Policy”) and in the
standard form issued by the Title Company in the State of Maryland, subject
only to the Permitted Exceptions.

          (3) No Environmental Event (as hereinafter defined) shall have occurred at
the Property.

          (4) This Agreement shall not have been terminated as expressly provided by
this Agreement.

9. REMEDIES.

     A. Seller’s Default. In the event Seller shall fail to sell, transfer and
assign the Property to Purchaser for any reason and/or perform any other
obligation of Seller hereunder, except upon a material default of Purchaser or
termination of this Agreement by Seller or Purchaser pursuant to the provisions
hereof, Purchaser shall be entitled to its choice of the following remedies:
(i) Purchaser may seek specific performance of this Agreement, or (ii)
Purchaser may declare this Agreement to be null and void and demand return of
the Purchase Deposit.

     B. Purchaser’s Default. In the event that Purchaser shall fail to
consummate this Agreement for any reason, except upon a default of Seller or
termination of this Agreement by Seller or Purchaser pursuant to the terms and
provisions hereof, Seller shall be entitled as its sole and exclusive remedy to
receive the Initial Deposit (and not the Second Deposit, which shall be
promptly returned to Purchaser), as full and agreed upon liquidated damages and
each of the Parties shall be released from any further liability hereunder.

10. DESTRUCTION, DAMAGE OR ENVIRONMENTAL EVENT PRIOR TO THE CLOSING DATE.

               (a) Except as otherwise provided herein or in the Right of Entry
Agreement, Seller assumes all risk of loss or damage to the Property by fire or
other casualty until the executed Deed is delivered to Purchaser at the
Closing. If at any time on or prior to the Closing Date any portion of the
Property is destroyed or damaged as a result of fire or any other cause
whatsoever, or if an Environmental Event (as hereinafter defined) shall occur,
Seller shall promptly give written notice thereof to Purchaser. In the event
of such destruction, damage or Environmental Event, Purchaser shall have the
right to terminate this Agreement by written notice to Seller within ten (10)
days following the date upon which Purchaser receives written notice and, upon
termination of this Agreement, the Purchase Deposit shall be promptly refunded
and paid over to Purchaser and neither Party shall have any further liability
to the other under this Agreement, except as expressly provided for by the
terms of this Agreement. If Purchaser does not elect to so terminate this
Agreement within said ten (10) day period, this Agreement shall remain in full
force and effect and the parties shall proceed to the Closing without any
reduction or adjustment in the Purchase Price and Purchaser shall assume all
responsibility, legal and financial, for the Property in its “as is” condition
at the time of Closing.

               (b) For the purposes of this paragraph 10, the term “Environmental Event”
shall mean the release, discharge or disposal of any Hazardous Material on,
onto, in (or within), under, over or from the Property, or the violation of any
Environmental Law because of the condition of, or activity on, the Property.
The term “Hazardous Material” means any hazardous or toxic material, substance,
contaminant or waste, or similar terms, defined by or regulated as such under
any Environmental Laws, including, but not limited to, petroleum and petroleum
products (other than petroleum products or other automotive fluids contained in
the automobiles which are parked on the Property in connection with Seller’s
public parking operations at the Property or any de minimis amount of petroleum
products or other automotive fluids that in the normal operations of a public
parking operation would be expected to leak from the automobiles parked on the
Property).

5

 

The term “Environmental Law(s)” means any federal, state or local
law, ordinance, regulation, rule, court order or decree, or administrative
order or any administrative policy or guideline concerning action levels of a
governmental authority relating to the environment, public health, any
Hazardous Material or any Environmental Event on, under or about the Property,
in effect from time to time, including, but not limited to (i) the Federal
Water Pollution Control Act, as amended (33 U.S.C. §1251 et seq.); (ii) the
Resource Conservation and Recovery Act, as amended (42 U.S.C. §6901 et seq.);
(iii) the Comprehensive Environmental Response, Compensation and Liability Act,
as amended (42 U.S.C. §9601 et seq.); (iv) the Federal Clean Air Act, as
amended (42 U.S.C. §7401 et seq.); (v) the Toxic Substances Control Act, as
amended (15 U.S.C. §2601 et seq.); and (ix) all regulations or guidelines
promulgated pursuant to all of the foregoing, as same may be amended from time
to time.

11. CONDEMNATION.

     In the event, at any time prior to the Closing Date, any action or
proceeding is filed, under which the Property, or any portion thereof, may be
taken pursuant to any law, ordinance or regulation or by condemnation or the
right of eminent domain, Seller shall promptly give written notice thereof to
Purchaser. Purchaser shall have the right to terminate this
Agreement by written notice to Seller within ten (10) days following the
date upon which Purchaser receives notice of such action or proceeding from
Seller and a description of the Property (or portion thereof) proposed to be
taken thereunder, and, upon termination of this Agreement, the Purchase Deposit
shall be promptly refunded and paid over to Purchaser and neither Party shall
have any further liability to the other under this Agreement, except as
expressly provided for by the terms of this Agreement. If Purchaser does not
elect to so terminate this Agreement within said ten (10) day period, this
Agreement shall remain in full force and effect and the Parties shall proceed
to the Closing without any reduction or adjustment in the Purchase Price.

12. DISPOSITION OF DEPOSIT.

     The Purchase Deposit shall be held by Escrow Agent in accordance with this
Agreement until the Closing, or until disposition thereof is made pursuant to
the terms of this Agreement. Escrow Agent shall have the right to disburse the
Purchase Deposit to Purchaser or Seller (a) at the Closing with respect to the
Purchase Deposit and/or (b) otherwise, as provided in this Agreement upon ten
(10) days written notice to the Parties; provided, however, that Escrow Agent
shall not have received any written objections to such disbursements within ten
(10) days after receipt by Purchaser and Seller of said notice. The Parties
acknowledge that Escrow Agent shall have no liability to any party on account
of Escrow Agent’s failure to disburse the Purchase Deposit if a dispute shall
have arisen between the Parties with respect to the propriety of such
disbursement; and there is an unresolved dispute as to who is entitled to
receive the amount(s) escrowed, Escrow Agent shall have the right to retain the
funds and disburse them in accordance with the final order of a Court of
competent jurisdiction located in Montgomery County, Maryland, or to deposit
such funds with said Court pending a final decision of such controversy. The
Parties further agree that Escrow Agent shall not be liable for failure of any
bona fide, federally-insured depository and shall not be otherwise liable
except in the event of Escrow Agent is guilty of negligence or misconduct.

13. DEVELOPMENT.

     A. Definitions.

               (1) “Applicable Law” means any federal, state or local law or regulation,
or bond covenants for Federal, County Government, or State bonds, applicable to
the parties, the Property and/or this Agreement. Applicable Law includes
orders of court or administrative agencies having jurisdiction over any of the
parties hereto with respect to or affecting the Purchaser or the Property,
including without limitation regulations of and requirements imposed by the
United States Food and Drug Administration (the “FDA”).

               (2) “Development Approvals” means, as contemplated by Applicable Law, and
as may be necessary, any subdivision approval (including without limitation the
Subdivision Waiver Approval), preliminary plan of subdivision approval, project
plan approval, site plan approval, record plat approval and recordation, site
plan enforcement agreements, building permits, storm water management
approvals, sediment control permits, utility connections and any other permit
or governmental or quasi-governmental approval (including without limitation
from the FDA) which is necessary to commence and duly and diligently construct
to completion, reconstruct, operate, repair and maintain the Project.

               (4) “Force Majeure” means the following events or circumstances, to the
extent that they cause the delay of performance of any obligation hereunder
incurred by Purchaser and such delay is beyond the reasonable control of and
could not be reasonably anticipated or accommodated by Purchaser:

          Strikes or lockouts (excluding the general contractor’s workforce) or
inability to procure materials or suitable substitute materials or failure of
utilities necessary for performance;

          Changes in law (including without limitation any Applicable Law)
applicable to the development, construction and/or operation of the Project,
including changes in law that would reduce or restrict the density, height or
use

6

 

of the Project as contemplated by Purchaser;

          Delays in obtaining Development Approvals for the development,
construction and/or operation of the Project, including the imposition of
conditions to Development Approvals that materially and adversely affect
Purchaser’s ability to construct the Project as contemplated by Purchaser;

          Acts of God, tornadoes, hurricanes, floods, sinkholes, fires and other
casualties, landslides, earthquakes, and abnormally inclement weather for the
area;

          Acts of war, terrorism, blockades, insurrection, riots, civil
disturbances, or national calamities; and

          Other acts or circumstances to the extent they would otherwise customarily
constitute a Force Majeure event.

          Force Majeure shall not include matters which increase cost but do not
cause delay.

               (3) “Permitted Uses” means the utilization of the Project for the Silver
Spring Ovarian Cancer Laboratory Project, other biotechnology or laboratory
purposes, and/or other uses supporting the primary use, including without
limitation administrative offices and storage.

               (4) “Project” means all improvements now or hereafter constructed on the
Property from time to time. The initial phase of the Project shall include
construction of approximately 37,000 square feet (and containing approximately
30,000 square feet of FAR) of laboratory space, related administrative
laboratory space, and related administrative and ancillary uses.

     B. Construction of Improvements.

          (1) Commencement of Construction. Purchaser agrees to commence
construction of the initial phase of the Project on the Property within ninety
(90) days after the later to occur of (i) the Closing Date or (ii) the issuance
of the Development Approvals (the “Construction Commencement Date”), and
thereafter to proceed with reasonable dispatch to complete construction of the
Project. Notwithstanding the foregoing, the Construction Commencement Date
shall be extended one (1) day for each day that the construction of the initial
phase of the Project cannot be undertaken due to events of Force Majeure up to
a total of 18 months after the Construction Commencement Date.

          (2) Completion of Construction. The initial phase of the Project shall be
“Substantially Completed” by the date (the “Substantial Completion Date”) which
is no later than the later to occur of (i) October 1, 2007, or (ii) the date
which is two (2) years after the issuance of the Development Approvals.
Notwithstanding the foregoing, the Substantial Completion Date shall be
extended one (1) day for each day that the construction of the initial phase of
the Project cannot be undertaken or Substantially Completed due to events of
Force Majeure. For purposes of this subparagraph (2), the initial phase of the
Project shall be deemed to be “Substantially Completed” on the date that
Purchaser’s architect shall execute a certificate of substantial completion
certifying, in part, that construction of the initial phase of the Project has
been substantially completed and is available for occupancy (subject to
issuance of a certificate of use and occupancy by the Montgomery County
Department of Permitting Services) for one or more of the Permitted Uses. The
terms, provisions and conditions of the above covenant are set forth in the
Restrictive Covenant and Repurchase Agreement, which Restrictive Covenant and
Repurchase Agreement shall control over any conflict with the terms, provisions
and/or conditions of this subparagraph (2).

          C. Cooperation in Obtaining Development Approvals. At all times after the
Effective Date and prior to the date of Closing, Seller shall cooperate with
Purchaser in assisting Purchaser to obtain Development Approvals. To this end,
Seller has executed and delivered to Purchase the Agency Authorization in the
form attached hereto as Exhibit F. The foregoing notwithstanding, any
instruments or agreements required of Seller hereunder shall be in form
reasonably acceptable to Seller and shall not impose any expense or liability
on Seller except as Seller may otherwise agree.

          D. Use of the Property. For a period of seven (7) years following
issuance of a certificate of use and occupancy for the initial phase of the
Project, the primary uses of the improvements constructed on the Property shall
be restricted to one or more of the Permitted Uses unless otherwise approved by
Seller (such approval not to be unreasonably withheld, conditioned or delayed).
The terms, provisions and conditions of the above covenant are set forth in
the Restrictive Covenant and Repurchase Agreement, which Restrictive Covenant
and Repurchase Agreement shall control over any conflict with the terms,
provisions and/or conditions of this subparagraph D.

          E. Access Easement. The Property shall be developed in such manner as to
preserve pedestrian and vehicular access to the Adjacent Garage from Cameron
Street to a degree that is at least as good as that which currently exists.
The Parties shall execute and deliver at Closing an Easement Agreement, in a
form to be agreed upon by the Parties prior to Closing covering both the
pedestrian and vehicular access and the Public Facilities.

     14. OPERATION OF THE PROPERTY PENDING CLOSING. Until the Closing Date,
Seller may continue to use the Property as a surface public parking lot in
substantially the same manner as Seller operated the public parking lot
immediately prior to the Effective Date and consistent with the operation of
other similar facilities operated by

7

 

Seller. Any material change in the use of
the Property shall require the prior written approval of Purchaser, which may
be granted or denied at Purchaser’s sole discretion. Seller shall not
construct on the Property improvements of any kind (other than pavement repair
work for the existing surface lot or repairs needed in connection with the
Public Facilities or other utilities serving the Adjacent Garage) without the
prior written approval of Purchaser, which may be granted or denied at
Purchaser’s sole discretion. Other than in connection with the public parking
on the Property or servicing the Adjacent Garage, Seller shall not store any
vehicles, supplies or materials (including without limitation any Hazardous
Materials) on the Property. Prior to the Closing Date, Seller shall remove at
its sole cost and expense all parking meters and other personal property of
Seller affixed to or located on the Property (excluding the Public Facilities).
Any such property remaining on the Property after the Closing Date shall
become the property of Purchaser and may be disposed of by Purchaser as it sees
fit without obligation to Seller. Prior to Closing, Seller shall not encumber
the Property or allow any judgment to attach to the Property or grant, convey
or assign any easement or other property right or interest in the Property or
any potion thereof

     15. CHOICE OF LAW. This Agreement, the rights and obligations of the
Parties hereto, and any claims or disputes relating thereto shall be governed
by and construed in accordance with the laws of the State of Maryland. In the
event of any dispute arising with respect to this Agreement, the Parties agree
that venue shall be in the Circuit Court for Montgomery County, Maryland.

     16. TIME OF ESSENCE. Purchaser and Seller agree that time is of the
essence of this Agreement.

     17. ACCEPTANCE; DATE OF AGREEMENT. The “Effective Date” shall be the date
this Agreement is executed by the Seller. This Agreement must be ratified and
accepted by Seller within thirty (30) business days after the date this
Agreement is executed by Purchaser in order to be effectual and binding;
otherwise, the obligations of Purchaser hereunder shall cease and terminate and
the Purchase Deposit shall be refunded.

     18. BINDING EFFECT; ENTIRE AGREEMENT. Purchaser and Seller mutually agree
that this Agreement shall be binding upon them, and their respective heirs,
executors, administrators, successors and assigns; that this Agreement contains
the final and entire Agreement between the Parties, and that they shall not be
bound by any terms, conditions, statements, warranties, or representations,
oral or written, express or implied, not expressly contained herein. The
language of this Agreement shall in all cases be construed as a whole and
according to its fair meaning and not strictly for or against any party hereto,
whether or not all or any portion of this Agreement was drafted by or on behalf
of any party hereto.

     19. PRONOUNS. The words “Seller,” “Purchaser,” all pronouns and any
variations thereof shall be deemed to refer to the masculine, feminine, neuter,
singular or plural, as the identity of the person or entity and the context may
require.

     20. NOTICES. Any notices, consents or other communications required or
permitted to be given pursuant to this Agreement must be in writing and shall
be deemed to have been delivered (a) if delivered in person or via courier,
when received at the address of the person to whom notice is given, (b) if sent
by a nationally recognized overnight delivery service (e.g., Federal Express,
UPS, Airborne Courier), on the first (1st) business day after receipt by such
delivery service for overnight delivery, or (c) if sent by certified United
States Mail (except where actual receipt is specified in this Agreement), on
the earlier of the date actually received or two (2) business days after
deposited in a receptacle provided by the United States Post Office, addressed
to the intended Parties at the following respective addresses:

	 	 	 
	If to Seller:

	 	Montgomery County Government
	Office of the County Executive
	 	 
	101 Monroe Street, Second Floor
	 	 
	Rockville, Maryland 20850
	 	 
	Attention: Chief Administrative Officer
	 	 

With a copy that does not constitute notice to:

Montgomery County Government

Department of Economic Development

101 Monroe Street

Rockville, Maryland 20850

Attention: Director

8

 

	 	 	 
	

	 	With a copy that does not constitute notice to:
	 
	 	 
	

	 	County Attorney for Montgomery County, Maryland
	

	 	101 Monroe Street, 3rd Floor
	

	 	Rockville, Maryland 20850
	

	 	Attn.: County Attorney
	 
	 	 
	

	 	With a copy that does not constitute notice to:

Montgomery County Department of Public

      Works and Transportation, Division of Parking Services

101 Orchard Ridge Drive, Suite 200

Gaithersburg, Maryland 20878

If to Purchaser:            Unither Pharmaceuticals, Inc.

1110 Spring Street

Silver Spring, Maryland 20910

Attn: General Counsel

With a copy to:      Holland & Knight LLP

3 Bethesda Metro Center, Suite 800

Bethesda, Maryland 20814

Attn. Jerald S. Cohn, Esq.

If to Escrow Agent:             Arthur Konopka Law Offices

4530 Wisconsin Avenue, N.W., Suite 300

Washington, D.C. 20016

Attn. Arthur Konopka, Esq.

or to such other substitute address and/or addressee as any party hereto shall
designate by written notice to the other party in accordance with the terms of
this paragraph; provided, however, that no such notice of change of address
and/or addressee shall be effective unless and until actually received by the
party to whom such notice is sent.

     21. MEMORANDUM OF CONTRACT. Upon execution of this Agreement, Seller and
Purchaser shall execute and deliver a Memorandum of Real Estate Purchase
Agreement (the “Memorandum of Contract”) in the form attached hereto as Exhibit
G. Purchaser shall thereupon cause the Memorandum of Contract to be recorded
against the Property to provide notice of the existence of this Agreement.

     22. MONTGOMERY COUNTY PROVISIONS.

          A. Master Plan Disclosures.

               (i) Seller has offered the Purchaser the opportunity to review the
applicable master plan and municipal land use plan for the area in which the
Property is located and any adopted amendment.

               (ii) Seller has informed Purchaser that amendments affecting the plan may
be pending before the County Planning Board or the County Council or a
municipal planning body.

               (iii) Purchaser has waived the right to review each plan and adopted
amendment.

               (iv) Purchaser understands, that to stay informed of future changes in
county or municipal land use plans, Purchaser should consult the County
Planning Board and the appropriate municipal planning body.

          B. Water and Sewer Disclosures.

               (i) Seller has provided to Purchaser the all information required by
§40-10A(a) of the

9

 

Montgomery Code (or Seller has informed Purchaser that Seller
does not know the information required by said §40-10A(a)), including the
following: (i) whether the Property is connected to, or has been approved for
connection to, a public water and sewer system, (ii) the source, if any, of
potable water for the Property, (iii) whether an individual sewage disposal
system has been constructed on the Property or approved or disapproved for
construction, (iv) the water and sewer service area category or categories that
currently apply to the Property, and a brief explanation of how each category
affects the availability of water and sewer service to the Property, (v) any
recommendations in the applicable master plan regarding water and sewer service
to the Property, and (vi) the status of any pending water and sewer
comprehensive plan amendments or service area category changes that would apply
to the Property.

               (ii) Purchaser understands that, to stay informed of future changes in
County or municipal water and sewer changes, Purchaser should consult the
County Planning Board, the Washington Suburban Sanitary Commission, the
Department of Permitting Services, or the Department of Environmental
Protection, or any appropriate municipal planning board or water and sewer
body.

          C. Subdivision Plat. Purchaser acknowledges that, due to the pending
subdivision process, Purchaser will not receive a copy of any plat of
subdivision in which the Property is located and no plat of subdivision will
exist on the date of Closing.

          D. Airports, Heliports Disclosures. Purchaser hereby acknowledges that
Seller has disclosed to Purchaser the relative location of an airport or
heliport, as defined in the Montgomery County Zoning Ordinance, existing within
a five-mile radius of the Property.

          E. Special Protection Area Disclosures. Seller has disclosed to Purchaser
whether the Property is located in an area designated as a special protection
area under §19-62 of the Montgomery County Code. If the Property is located in
a “special protection area,” Purchaser understands that special water quality
measures and certain restrictions on land uses and impervious surfaces may
apply to the Property.

[Signatures Commence on Next Page]

10

 

IN WITNESS WHEREOF, the Parties hereto hereby ratify, accept and agree to the
above and acknowledge it to be our Agreement, all as of the day and year first
hereinabove written.

	 	 	 	 	 
	 	 	PURCHASER:
	 
	 	 	 	 
	 	 	UNITHER PHARMACEUTICALS, INC., a Delaware corporation
	 
	 	 	 	 
	

	 	By:
	 	/s/ Martine Rothblatt, Ph.D.
	

	 	 	 	
 
	

	 	Name:
	 	Martine Rothblatt, Ph.D.
	

	 	Title:
	 	CEO
	 
	 	 	 	 
	 	 	Date: October 31, 2003
	 
	 	 	 	 
	 	 	SELLER:
	 
	 	 	 	 
	 	 	MONTGOMERY COUNTY, MARYLAND
	 
	 	 	 	 
	

	 	By:
	 	/s/ William Money
	

	 	 	 	
 
	

	 	 	 	William Mooney
	

	 	 	 	Assistant Chief Administrative Officer
	 
	 	 	 	 
	 	 	Date: November 20, 2003
	 
	 	 	 	 
	 	 	APPROVED AS TO FORM AND LEGALITY
	 
	 	 	 	 
	

	 	By:
	 	/s/ Diane R. A. Jones
	

	 	 	 	
 
	

	 	 	 	Diane R. A. Jones
	

	 	Date:
	 	November 14, 2003

11

 

EXHIBIT E

After recording, return to:

_________________________

_________________________

_________________________

RESTRICTIVE COVENANT

AND REPURCHASE AGREEMENT

     THIS RESTRICTIVE COVENANT AND REPURCHASE AGREEMENT (this “Agreement”) is
made as of this         day of         , 200   , by and between MONTGOMERY
COUNTY, MARYLAND, a political subdivision of the State of Maryland (the
“County”), and UNITHER PHARMACEUTICALS, INC., a Delaware corporation
(“Unither,” which term shall include the successors and assigns of Unither).

RECITALS

     A. Pursuant to that certain Special Warranty Deed of even date herewith,
the County conveyed to Unither all the County’s right, title and interest in
and to that certain parcel of real property located in Montgomery County,
Maryland, more particularly described by Exhibit A attached hereto (the
“Property”).

     B. Unither has proposed to construct certain improvements on the Property.

     C. The County and Unither agreed to enter into this Agreement in order to
ensure that the Construction Covenant and the Permitted Uses Covenant (as
hereinafter defined) as set forth in this Agreement (i) will, during the
Effective Period (as hereafter defined), run with, encumber and burden the
Property, and be binding, during the Effective Period, upon Unither and all
others who may hereafter obtain any interest in or to all or any portion of the
Property, and (ii) will, during the Effective Period, run to the benefit of the
County and be enforceable, in accordance with the terms of this Agreement, by
the County.

     NOW, THEREFORE, in consideration of the foregoing recitals and of other
good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the County and Unither do hereby covenant and agree as
follows:

     1. Definitions.

          (a) “Additional Investment Costs” mean all actual out-of-pocket costs paid
by Unither to third parties and which are incurred through the date of the
closing of the repurchase for construction, architectural and engineering
services and materials in connection with the development and construction of
the improvements which comprise the Project.

          (b) “Applicable Law” means any federal, state or local law or regulation,
or bond covenants for Federal, County Government, or State bonds, applicable to
the parties, the Property and/or this Agreement. Applicable Law includes
orders of court or administrative agencies having jurisdiction over any of the
parties hereto with respect to or affecting Unither or the Property, including
without limitation regulations of and requirements imposed by the United States
Food and Drug Administration (the “FDA”).

          (c) “Changes in Law” means changes in law (including without limitation
any Applicable Law) applicable to the development, construction and/or
operation of the Project, including changes in law that would reduce or
restrict the density, height or use of the Project as contemplated by Unither;

          (d) “Development Approvals” means, as contemplated by Applicable Law, and
as may be necessary, any subdivision approval (including without limitation
approval beyond any applicable appeal period of the waiver of certain
Subdivision Regulations as requested by Unither by letter dated August 28,
2003, to the Montgomery County Planning Board of the Maryland-National Capital
Park and Planning Commission), preliminary plan of subdivision approval,
project plan approval, site plan approval, record plat approval and
recordation, site plan enforcement agreements, building permits, storm water
management approvals, sediment control permits, utility connections and any
other permit or governmental or quasi-governmental approval (including without
limitation from the FDA) which is necessary to commence and duly and diligently
construct to completion, reconstruct, operate, repair and maintain the Project.

12

 

          (e) “Force Majeure” means the following events or circumstances, to the
extent that they cause the delay of performance of any obligation hereunder
incurred by Unither and such delay is beyond the reasonable control of and
could not be reasonably anticipated or accommodated by Unither:

	 	•	 	Strikes or lockouts (excluding the
general contractor’s workforce) or inability to procure
materials or suitable substitute materials or failure of
utilities necessary for performance;
	 
	 	•	 	Changes in Law;
	 
	 	•	 	Delays in obtaining Development
Approvals for the development, construction and/or
operation of the Project, including the imposition of
conditions to Development Approvals that materially and
adversely affect Unither’s ability to construct the
Project as contemplated by Unither;
	 
	 	•	 	Acts of God, tornadoes, hurricanes,
floods, sinkholes, fires and other casualties,
landslides, earthquakes, and abnormally inclement weather
for the area;
	 
	 	•	 	Acts of war, terrorism, blockades,
insurrection, riots, civil disturbances, or national
calamities; and
	 
	 	•	 	Other acts or circumstances to the
extent they would otherwise customarily constitute a
Force Majeure event.
	 
	 	•	 	Force Majeure shall not include matters
which increase cost but do not cause delay.

          (f) “Permitted Uses” means the utilization of the Project for the Silver
Spring Ovarian Cancer Laboratory, other biotechnology or laboratory purposes,
and/or other uses supporting the primary use, including without limitation
administrative offices and storage.

          (g) “Project” means all improvements now or hereafter constructed on the
Property from time to time. The initial phase of the Project shall include
construction of approximately 37,000 square feet (and containing approximately
30,000 square feet of FAR) of laboratory space, related administrative
laboratory space, and related administrative and ancillary uses.

          (h) “Repurchase Price” means the amount equal to the sum of (i) one
hundred percent (100%) of the Purchase Price paid by Unither to the County for
the Property, which is an amount equal to [TWO MILLION EIGHT HUNDRED EIGHTY
THOUSAND AND NO/100 DOLLARS ($2,880,000.00)], plus (ii) Additional Investment
Costs.

     2. Construction Covenant.

          (a) Unither hereby covenants and agrees that the initial phase of the
Project shall be “Substantially Completed” by the date (the “Substantial
Completion Date”) which is no later than the later to occur of (i) October 1,
2007, or (ii) the date which is two (2) years after the issuance of the
Development Approvals. Notwithstanding the foregoing, the Substantial
Completion Date shall be extended one (1) day for each day that the
construction of the initial phase of the Project cannot be undertaken or
Substantially Completed due to events of Force Majeure.

          (b) For purposes of paragraph 2(a) above, the initial phase of the Project
shall be deemed to be “Substantially Completed” on the date that Unither’s
architect shall execute a certificate of substantial completion certifying, in
part, that construction of the initial phase of the Project has been
substantially completed and is available for occupancy (subject to issuance of
a certificate of use and occupancy by the Montgomery County Department of
Permitting Services) for one or more of the Permitted Uses.

          (c) Promptly after the initial phase of the Project has been Substantially
Completed, upon request made by Unither to the County, the County shall execute
a written release of the Construction Covenant to be recorded among the Land
Records of Montgomery County, Maryland.

     3. Permitted Uses Covenant.

          (a) Unither hereby covenants and agrees that, commencing on the date of
issuance of a certificate of use and occupancy for the initial phase of the
Project and continuing through the last day of the Effective Period (as
hereinafter defined), the primary use of the Project shall be restricted to one
or more of the Permitted Uses unless otherwise approved by the County, such
approval not to be unreasonably withheld, conditioned or delayed (the aforesaid
covenant is hereinafter referred to as the “Permitted Uses Covenant”). Nothing
herein shall be deemed to prohibit Unither from leasing or

13

 

licensing all or a portion of the Property (or to consent to any sublease)
to related or third party tenants, subtenants or licensees so long as each said
tenant, subtenant or licensee, as the case may be, is obligated by the term of
its lease, sublease or license to use its premises solely for one or more of
the Permitted Uses.

          (b) Notwithstanding anything to the contrary set forth in this Agreement,
in the event that a Change in Law shall occur which prohibits or materially
limits any of the Permitted Uses, and said Change in Law was not initiated by
Unither or acquiesced by Unither, then this Agreement shall thereupon
automatically terminate (including without limitation the Construction Covenant
and the Permitted Use Covenant) and be of no further force or effect. Upon
request made by Unither to the County after the effective date of such a Change
on Law, the County shall promptly execute a written release of this Agreement
to be recorded among the Land Records of Montgomery County, Maryland.

     4. Default under Construction Covenant; Remedy.

          (a) A “Construction Covenant Event of Default” shall be deemed to have
occurred under this Agreement after the occurrence of all of the following:

	 	(i)	 	A violation of the covenant set forth
paragraph 2(a) above shall have occurred; and
	 
	 	(ii)	 	the County shall have provided to
Unither a written notice of default describing the
alleged violation in reasonable detail (the “Notice of
Construction Covenant Default”); and
	 
	 	(iii)	 	Unither has failed to cure said
violation within ninety (90) days after Unither’s receipt
of the Notice of Construction Covenant Default (or, if
the cure of the violation cannot reasonably be cured
within said 90-day period and if Unither has commenced
action to cure said violation within said 90-day period
and continues diligently to pursue said cure, such longer
time as may be reasonably necessary to cure such
violation) (said cure period, the “Cure Period”).

          (b) The County’s sole and exclusive remedy in the event of an occurrence
of a Construction Covenant Event of Default shall be to elect to repurchase the
entire Property (including the then-existing improvements), strictly in
accordance with the provisions set forth in subparagraphs 4(b)(i) through (iv)
below (the “Repurchase Right”).

               (i) The County shall exercise the Repurchase Right by providing written
notice to Unither (the “Exercise Notice”) no more than thirty (30) days after
the expiration of the Cure Period. If the County shall fail to provide the
Exercise Notice within said thirty (30) day period, the County shall be deemed
to have waived its right to exercise its Repurchase Right with respect to said
Construction Covenant Event of Default.

               (ii) Upon exercise of the Repurchase Right, the County shall repurchase
the Property (including without limitation any improvements constructed
thereon) but excluding all personal property located thereon or therein) at the
Repurchase Price. The County’s repurchase right shall exclude all of Unither’s
personal property located on the Property (other than such fixtures and other
items of personal property which are included as part of the Additional
Investment Costs), which personal property shall be removed by Unither prior to
the closing of the repurchase and shall all times remain the property of
Unither unencumbered by this Agreement. Unither shall exercise due care in the
removal of its personal property from the Property and Unither shall be
responsible for the costs of repairing any damage caused to the improvements as
a result of such removal. In the event that the Repurchase Price includes
payment for documents, warranties, plans and/or specifications related to the
Project and stored or maintained at a location other than the Property, Unither
will, to the extent of its ownership rights therein, deliver or cause copies of
such construction documents, warranties, plans and/or specifications to be
delivered to the County at one or more locations to be prescribed by the
County.

               (iii) The closing on the repurchase shall occur on a date after the date
of the Exercise Notice that is mutually satisfactory to Unither and the County,
but in no event shall such closing occur more than one hundred eighty (180)
days after the date of the Exercise Notice. At the closing of the repurchase
(i) Unither will, by special warranty deed, convey to County all of Unither’s
right, title, and interest in the Property and all improvements thereon, free
and clear of all liens and encumbrances except the title exceptions listed as
“Permitted Exceptions” in the deed to Unither from the County and any other
easements, covenants and restrictions encumbering the Property that Unither
accepted after said closing; and (ii) the County shall pay to Unither the
Repurchase Price by wire transfer of funds pursuant to wire instructions to be
provided to the County prior to the closing of the repurchase. If the County
provides the Exercise Notice but fails, for any reason other than a breach or
default by Unither, to close on the repurchase as aforesaid, the County shall
waive all of its rights to repurchase the Property and this Agreement
(including the Construction Covenant, the Permitted Uses Covenant, and the

14

 

Repurchase Right) shall be deemed terminated without further action by any
party, and Unither may thereafter sell, use or lease the Property free and
clear thereof.

               (iv) Upon closing on the repurchase and the payment by the County to
Unither of the Repurchase Price, the County and Unither agree that each shall
be released of any and all liability to the County with respect to the
Property, including without limitation arising by virtue of this Agreement.

     5. Default under Permitted Uses Covenant; Remedy.

          (a) A “Use Covenant Event of Default” shall be deemed to have occurred
under this Agreement after the occurrence of all of the following:

	 	(i)	 	A violation of the covenant set forth
paragraph 3(a) above shall have occurred; and
	 
	 	(ii)	 	the County shall have provided to
Unither a written notice of default describing the
alleged violation in reasonable detail (the “Notice of
Default”); and
	 
	 	(iii)	 	Unither has failed to cure said
violation within ninety (90) days after Unither’s receipt
of the Notice of Default (or, if the cure of the
violation cannot reasonably be cured within said 90-day
period and if Unither has commenced action to cure said
violation within said 90-day period and continues
diligently to pursue said cure, such longer time as may
be reasonably necessary to cure such violation).

          (b) The County’s sole and exclusive remedy in the event of an occurrence
of a Use Covenant Event of Default shall be to enforce the Permitted Use
Covenant by seeking from the Circuit Court for Montgomery County, Maryland, an
appropriate injunction to enjoin the violation of the Permitted Uses Covenant.
Unither acknowledges that, upon a violation of the Permitted Uses Covenant, the
County would suffer damages that would not be compensated adequately by the
award of money damages or other remedy at law alone. Accordingly, Unither
agrees that the issuance of an injunction enjoining the violation of Permitted
Uses Covenant would be appropriate. Unither shall raise no defense to any
petition for an injunction sought by the County under this subparagraph except
to argue, if appropriate, that the use in question is, in fact, one of the
Permitted Uses. In the event of an occurrence of a Use Covenant Event of
Default, (i) the County shall have no right to seek monetary damages and the
County hereby waives any such right, and (ii) the County would have no right to
repurchase the Property (or any portion thereof).

     6. Effective Period. This Agreement shall be valid commencing on the date
of this Agreement and shall terminate automatically (and without the need for
any further documentation to be executed or recorded by any party) on the date
that is seven (7) years after the initial use and occupancy certificate for the
initial phase of the Project is issued by Montgomery County, Maryland (the
“Effective Period”). Upon request made by Unither to the County after the
Effective Period has expired, the County shall promptly execute a written
release of this Agreement to be recorded among the Land Records of Montgomery
County, Maryland.

     7. Benefit and Burden. Each provision of this Agreement is, during the
Effective Period, (i) an equitable servitude upon and a covenant running with,
encumbering and burdening, during the Effective Period, the Property and (ii)
binding upon Unither and all others who may hereafter obtain any interest in or
to all or any portion of the Property. Each provision of this Agreement is,
during the Effective Period, enforceable (only as permitted by paragraphs 4 and
5 of this Agreement, as applicable) by the County.

     8. Governing Law. This Agreement, the rights and obligations of the
parties hereto, and any claims or disputes relating thereto shall be governed
by and construed in accordance with the laws of the State of Maryland. In the
event of any dispute arising with respect to this Agreement, the parties agree
that venue shall be in the Circuit Court for Montgomery County, Maryland.

     9. Notices. Any notices, consents or other communications required or
permitted to be given pursuant to this Agreement must be in writing and shall
be deemed to have been delivered (a) if delivered in person or via courier,
when received at the address of the person to whom notice is given, (b) if sent
by a nationally recognized overnight delivery service (e.g., Federal Express,
UPS, Airborne Courier), on the first (1st) business day after receipt by such
delivery service for overnight delivery, or (c) if sent by certified United
States Mail (except where actual receipt is specified in this Agreement), on
the earlier of the date actually received or two (2) business days after
deposited in a receptacle provided by the United States Post Office, addressed
to the intended Parties at the following respective addresses:

15

 

	 	 	 	 	 
	 
	 	 	 	 
	If to the County:	 	Montgomery County Government
	

	 	 	 	Chief Administrative Officer
	

	 	 	 	101 Monroe Street, Second Floor
	

	 	 	 	Rockville, Maryland 20850
	 
	 	 	 	 
	

	 	 	 	With a copy that does not constitute notice to:
	 
	 	 	 	 
	

	 	 	 	Montgomery County Government
	

	 	 	 	Department of Public Works and Transportation
	

	 	 	 	101 Monroe Street, 10th Floor
	

	 	 	 	Rockville, Maryland 20850
	

	 	 	 	Attention: Director
	 
	 	 	 	 
	

	 	 	 	With a copy that does not constitute notice to:
	 
	 	 	 	 
	

	 	 	 	Montgomery County Government
	

	 	 	 	Department of Economic Development
	

	 	 	 	101 Monroe Street, 15th Floor
	

	 	 	 	Rockville, Maryland 20850
	

	 	 	 	Attention: Director
	 
	 	 	 	 
	

	 	 	 	With a copy that does not constitute notice to:
	 
	 	 	 	 
	

	 	 	 	County Attorney for Montgomery County, Maryland
	

	 	 	 	101 Monroe Street, 3rd Floor
	

	 	 	 	Rockville, Maryland 20850
	

	 	 	 	Attn.: County Attorney
	 
	 	 	 	 
	If to Unither:

	 	 	 	Unither Pharmaceuticals, Inc.
	

	 	 	 	1110 Spring Street
	

	 	 	 	Silver Spring, Maryland 20910
	

	 	 	 	Attn: General Counsel
	 
	 	 	 	 
	

	 	 	 	With a copy that does not constitute notice to:
	 
	 	 	 	 
	

	 	 	 	Holland & Knight LLP
	

	 	 	 	3 Bethesda Metro Center, Suite 800
	

	 	 	 	Bethesda, Maryland 20814
	

	 	 	 	Attn. Jerald S. Cohn, Esq.

or to such other substitute address and/or addressee as any party hereto shall
designate by written notice to the other party in accordance with the terms of
this paragraph; provided, however, that no such notice of change of address
and/or addressee shall be effective unless and until actually received by the
party to whom such notice is sent.

     10. Binding Effect; Survival. This Agreement shall be binding, during the
Effective Period, upon Unither and all others who may hereafter obtain any
interest in or to all or any portion of the Property.

     11. Partial Invalidity. If any provision of this Agreement or the
application of any such provision to any person or circumstance shall be
invalid or unenforceable, the remainder of this Agreement, and the application
of that provision to persons or circumstances other than those as to which it
is held invalid or unenforceable, shall not be affected, and each provision of
this Agreement shall be valid and enforceable to the fullest extent permitted
by law.

     12. Interpretation. The article and section headings used in this
Agreement are for convenience only and shall not enter into the interpretation
of this Agreement. If any date upon which action is required under this
Agreement shall be a Saturday, Sunday, or legal holiday, the date for such
action shall be extended to the first regular business day after such date
which is not a Saturday, Sunday or legal holiday. The Recitals set forth in
this Agreement are incorporated into and made a part of this Agreement.

     13. No Third-Party Beneficiaries. No party other than the County shall
have any rights under this Agreement, as third-party beneficiaries or
otherwise.

16

 

     14. Entire Declaration. This Agreement contains the entire agreement
between the parties regarding the subject matter of this Agreement. There are
no promises, agreements, conditions, undertakings, warranties, or
representations, oral or written, express or implied, between the parties
relating to the subject matter hereof, other than as set forth in this
Agreement. This Agreement is intended by the parties to be an integration of
all prior or contemporaneous promises, agreements, conditions, negotiations,
and undertakings between them. This Agreement shall not be construed more
strictly against one party than against the other party merely because its may
have been prepared by counsel for one of the parties, it being recognized and
agreed that all parties are thoroughly familiar with the terms and provisions
of this Agreement and, together with their respective counsel, have actively
participated in the preparation of this Agreement.

     15. Modifications, Waivers, and Consents. Modifications, waivers, and
consents respecting this Agreement shall only be binding if in writing and
signed by Unither (or its successor or assigns) and the County. In addition,
no modification of this Agreement shall be effective unless and until duly
recorded among the Land Records of Montgomery County, Maryland.

     16. No Partnership. This Agreement is not intended to, and does not,
create a joint venture, partnership, or any other similar relationship between
the parties.

     17. No Waiver. Except as otherwise expressly provided in this Agreement,
(i) no delay or omission by the County in exercising any right or power
accruing upon Unither’s non-compliance with or failure to perform any of the
provisions of this Agreement shall impair or be construed to be a waiver of any
such right or power, and (ii) a waiver by the County of any of the obligations
of Unither under this Agreement in one instance shall not be construed to be a
waiver of any subsequent breach of that obligation or a waiver of any other
term, covenant, or condition of this Agreement.

     18. Estoppel Certificates. The County shall, without charge, at any time
and from time to time hereafter, within twenty (20) days after written request
of Unither, certify by written instrument, duly executed and acknowledged, to
any mortgagee, proposed mortgagee, proposed purchaser or proposed tenant
(collectively, the “Addressee”): (i) whether this Agreement has been
supplemented or amended, and, if so, the substance and manner of the supplement
or amendment; (ii) whether any default exists under this Agreement, and, if so,
a description of each such default; (iii) whether any offsets, counterclaims or
defenses exist on the part of the responding party with respect to its
obligations under this Agreement, and, if so, the nature and amount of such
offsets, counterclaims or defenses; and (iv) such other matters as maybe
reasonably requested. Subject to the foregoing, any such certification shall
be in form and substance acceptable to the County and shall provide that the
certificate is for the sole benefit of the Addressee and may not be relied upon
by any other person or entity. The certificate shall estop the County from
asserting a defense or claim against the Addressee that is inconsistent with
the facts contained in the certificate, but only to the extent the Addressee
relied upon the statement of fact and had no actual knowledge of any facts that
were inconsistent with the facts contained in the certificate. Regardless of
any inaccuracy or misstatement contained therein, said certificate shall create
no liability on the part of the County to the Addressee.

     19. Recordation. Unither shall pay all costs of recording this Agreement,
including, without limitation, the costs of tax certificates, notary fees,
documentary stamps, all transfer and recordation taxes, and recording charges.

     20. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be an original but all of which shall
constitute one and the same instrument.

[SIGNATURES COMMENCE ON NEXT PAGE]

17

 

     IN WITNESS WHEREOF, the parties have caused this Restrictive Covenant and
Repurchase Agreement to be executed as of the above written date.

	 	 	 	 	 
	 	 	UNITHER:
	 
	 	 	 	 
	 	 	UNITHER PHARMACEUTICALS, INC., a Delaware corporation
	 
	 	 	 	 
	

	 	By:	 	 
	

	 	 	 	
 
	

	 	Name:	 	 
	

	 	 	 	
 
	

	 	Title:	 	 
	

	 	 	 	
 
	 
	 	 	 	 
	 	 	COUNTY:
	 
	 	 	 	 
	 	 	MONTGOMERY COUNTY, MARYLAND
	 
	 	 	 	 
	

	 	By:	 	 
	

	 	 	 	
 
	

	 	 	 	Douglas M. Duncan,
	

	 	 	 	County Executive
	 
	 	 	 	 
	 	 	APPROVED AS TO FORM AND LEGALITY
	 
	 	 	 	 
	

	 	By:	 	 
	

	 	 	 	
 
	 
	 	 	 	 
	

	 	Date:
	 	           , 2003

	 	 	 	 	 	 	 	 	 
	STATE OF MARYLAND

	 	 	)	 	 	 	 	 
	

	 	 	 	 	 	) : ss	 	 
	COUNTY OF MONTGOMERY

	 	 	)	 	 	 	 	 

     On
this         day of
               , 2003, before me, personally appeared
Douglas M. Duncan, who acknowledged himself to be the County Executive of
Montgomery County, Maryland, a political subdivision of the State of Maryland,
and that he, as said as County Executive, executed the foregoing Restrictive
Covenant and Repurchase Agreement for the purposes therein contained.

     IN WITNESS WHEREOF, I hereunto set my hand and official seal.

	 	 	 	 	 
	

	 	 	 	
 
	

	 	 	 	Notary Public
	 
	 	 	 	 
	My Commission Expires:
	 	 	 	 
	

	 	
 	 	 

18

 

     THIS IS TO CERTIFY that the within instrument has been prepared by or
under the supervision of the undersigned Maryland attorney.

	 	 	 	 	 
	

	 	
 	 	 
	

	 	Jerald S. Cohn	 	 

19

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