Document:

exv10w49

 

Exhibit 10.49

Confidential Project

SETTLEMENT AGREEMENT

BETWEEN THE UNDERSIGNED

IDM Pharma SA, formerly Immuno-Designed Molecules, a French “société anonyme” with a share capital
of 1.975.000 Euros, the registered office of which is located 172 rue de Charonne, 75011 Paris,
registered on the Paris Companies Register under number B 382 632 263 represented by T. Walbert,

FOR THE FIRST PART,

AND

SANOFI-AVENTIS, formerly SANOFI-SYNTHELABO, a French “société anonyme” with a share capital of 2
718 869 366 Euros, the registered office of which is located 174 avenue de France, 75013 Paris,
registered on the Paris Companies Register under number B 403 335 938 represented by,

FOR THE OTHER PART

Hereafter referred to as “Party” or commonly as the “Parties”

RECITALS:

	1.	 	IDM Pharma SA (herafter “IDM”) is a biotechnology company that developed a know-how and
expertise in the field of immunotherapy, and particularly in ex vivo cancer treatments for
humans.
	 
	 	 	Sanofi-Aventis (hereafter “Sanofi”) is a pharmaceutical company that develops, manufactures
and markets pharmaceutical products in the field of human health on a worldwide basis.
	 
	2.	 	On July 13, 1999, IDM and Sanofi signed a Licence Agreement (hereafter the “1999 License
Agreement”) defining the terms and conditions under which Sanofi granted IDM a non exclusive
license to its industrial property rights relating to the IL-13 cytokine, in consideration for
Sanofi’s taking a stake in IDM’s capital and receiving a commercialization option should
developments undertaken by IDM under this license be successful.
	 
	3.	 	IDM and Sanofi signed a Memorandum Agreement on July 20, 2001 (hereafter “the 2001
Agreement”) defining the terms and conditions under which Sanofi has been granted a certain
number of options on IDM Developments Programs in the field of ex vivo cellular therapies.
This 2001 Agreement amended the terms on the above-mentioned 1999 License Agreement.

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	 	 	The 2001 Agreement was entered for a fixed period of 10 years as from its effective date,
but the development programs under the 2001 Agreement was not entered for a fixed duration.
	 
	 	 	Pursuant to Article 5.3 of the 2001 Agreement, Sanofi has the right, subject to three months
notice to IDM, to discontinue at any time, each Development Program, without any
justification and without any compensation to IDM.
	 
	4.	 	Further to the 2001 Agreement, IDM and Sanofi agreed to amend the 1999 License Agreement and
concluded on November 30, 2001 a IL13 agreement (hereafter “the IL 13 Agreement”) modifying
the supply conditions of IDM of IL-13 products and specifying some terms and conditions of the
1999 License Agreement for the marketing of search kits IL-13, the achievement of development
programs IL-13 and the marketing of finished IL-13 products and providing for the execution of
a license agreement. Such license (the amended and restated IL13 License Agreement) has been
signed on August 12th, 2005.
	 
	5.	 	In a letter dated December 21, 2001, pursuant to article 3.7.of the 2001 Agreement, Sanofi
notified IDM of its decision to exercise one Development Option for the IDD-3-program for the
treatment of melanoma (hereafter the “Uvidem Development Program”).and the Parties have
thereafter implemented the Uvidem Development Program pursuant to the terms and conditions of
the 2001 Agreement
	 
	8.	 	By registered letter dated December 26, 2007, Sanofi notified IDM of its decision to
terminate the Uvidem Development Program, subject to 3 month notice period, in accordance with
Article 5.3 of the 2001 Agreement. However Sanofi stated that its decision should not impact
it future option rights for the remaining duration of the 2001 Agreement, as defined in
Article 3.1 and 10.4 of the 2001 Agreement.
	 
	9.	 	Contrary to the position of Sanofi, IDM considers that Sanofi’s termination of its
participation in the UVIDEM Development Program under the 2001 Agreement described herein was
sudden and unpredictable and that despite the three months notice, such termination was an
abuse of Sanofi’s rights under Article 5.3 of the 2001 Agreement. Furthermore, IDM considers
that Sanofi’s termination of its participation in the Uvidem Development Program may
jeopardize continuation of the Uvidem Development Program as a whole.
	 
	10.	 	Notwithstanding their opposing views regarding the termination of Sanofi’s participation in
the Uvidem Development Program, the Parties have entered into discussions with the intention
to settle definitively the consequences of the termination of Uvidem Development Program
pursuant to the terms and conditions of this Settlement Agreement.
	 
	11.	 	Sanofi considers that it has complied with its obligations under the 2001 Agreement and that
its decision to terminate its participation to the Uvidem Development Program fully complies
with the wording and spirit of the Article 5.3 of the 2001 Agreement.

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	12.	 	Unless otherwise provided or defined in this Settlement Agreement, capitalised terms in the
Settlement Agreement shall have the same meaning as the capitalised terms of the 2001
Agreement.

IT WAS THEREFORE AGREED AS FOLLOWS:

	1.	 	PURPOSE

This Settlement Agreement is aimed at terminating, in a final and irrevocable manner, the various
pending or potential disputes between the Parties as described in the Recitals regarding the Uvidem
Development Program.

In order to settle the conditions under which Uvidem Development Program has been terminated and to
prevent any further dispute, the Parties have hereto agreed mutual concessions in consideration of
which they accordingly hereby fully, finally and irrevocably settle their respective claims,
actions, demands and disputes existing or which cause has arisen or was disclosed as at the date
hereof.

The Parties acknowledge that this Settlement Agreement does not constitute an acknowledgement or an
admission of the positions taken by each Party in the pending disputes, such as described in the
Recitals hereabove.

	2.	 	MUTUAL CONCESSIONS

	2.1	 	Sanofi’s obligations

In consideration for IDM’s release and waiver of action under Article 4 below, and subject
to the performance in full by IDM of its obligations pursuant to Article 2.2:

	 	2.1.1	 	Sanofi grants to IDM a lump sum of 5,217,185 Euros (excluding VAT) payable at
the Effective Date of this Settlement Agreement by cheque or standing order to the
order of IDM SA, corresponding to :

	 	(i)	 	payment of invoice in relation to
services for Q1 2008 for an amount of 1,600,000 Euros,
	 
	 	(ii)	 	payment of a final amount of
3,617,185 Euros.

	 	2.1.2	 	Sanofi releases and discharges IDM from all its obligations under the Uvidem
Development Program. Sanofi acknowledges that under the 2001 Agreement, IDM is under no
obligation to carry out any new Developments Programs or develop any new Product.
	 
	 	2.1.3	 	The 2001 Agreement remains in full force and effect except the provisions of
article 5.10 of the 2001 Agreement related to the right of first refusal granted by IDM
to Sanofi with regard to the Uvidem Development Program.

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	2.2	 	IDM’s obligations
	 
	 	 	In consideration for Sanofi’s release and waiver of action under Article 4 below, and
subject to the performance in full by Sanofi of its obligations pursuant to Article 2.1:

	 	2.2.1	 	IDM declares that it has been fully compensated for all damages arising out of
or in connection with the termination of the Uvidem Development Program.
	 
	 	2.2.2	 	IDM releases and discharges Sanofi from all its obligations under the Uvidem
Development Program.
	 
	 	2.2.3	 	IDM shall indemnify (including all costs and fees) and hold Sanofi harmless
from and against and in respect of any claim by any past or present employee of IDM or
any IDM Affiliate in respect of any claim arising from the effect of Sanofi’s decision
to terminate the Uvidem Development Program.

	3.	 	CONTRACTUAL CONSEQUENCES OF THE DISCONTINUATION OF THE PARTICIPATION OF SANOFI OF THE UVIDEM
DEVELOPMENT PROGRAM
	 
	 	 	Pursuant to its decision not to interrupt the Uvidem Development Program, and in accordance
with provision of Article 5.4 of the 2001 Agreement, the Parties acknowledge that IDM shall
be free without any consideration on its part to develop the corresponding Product in the
Therapeutic indication covered by the interrupted Uvidem Development Program, either on its
own or in collaboration with a third party without any obligation to Sanofi.
	 
	 	 	Sanofi agrees not to be granted with the right of first refusal as described in article 5.10
with respect to the Uvidem Development Program.
	 
	4.	 	JUDICIAL PROCEEDINGS

As a result of this Settlement Agreement, the Parties expressly and irrevocably waive all actions,
claims and/ or counterclaims of any type in respect of the termination of the Uvidem Development
Program.

The Parties waives any rights or cause of action arising out of the performance or termination of
the Uvidem Development Program, and any factual or legal relationship which may exist or have
existed between the Parties in that connection.

Without prejudice to any separate confidential agreement, each Party has to bear its own legal
costs of the present Settlement Agreement.

Except as set forth in this Settlement Agreement, the Parties, for and in consideration of this
Settlement Agreement and other good and valuable consideration described herein received from each
other, do hereby release and fully discharge each other, and their agents, representatives,
predecessors, heirs, successors, assigns, attorneys, parent companies,

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subsidiaries, and related entities, and their officers, directors and shareholders forever of and
from any and all manner of action and actions, cause and causes of action, claims, obligations,
liabilities, and demands of any kind whatsoever, which each may have had, ever had, claims to have
had, now has, or which their predecessors, heirs, and successors can, shall, or may have that
arises from or relates to the allegations of the complains in the pending and/or threatened action
relating the Uvidem Development Program.

The provisions of the third paragraph of article 5.2 of the 2001 Agreement, related to the
warranties and liabilities of IDM, shall remain applicable to the Uvidem Development Program.

	5.	 	EFFECTIVE DATE

The present Settlement Agreement shall become effective at the date of signature by the Parties
(the “Effective Date”).

	6.	 	LEGAL SUCCESSORS

The Settlement Agreement is binding upon and inures to the benefit of the heirs, successors,
assignees, subsidiaries, licensees and affiliates of the Parties.

	7.	 	MISCELLANEOUS

	7.1	 	Subject to proper performance hereof, this Settlement Agreement is made as a full and final
release and discharge of all accounts in accordance with the terms or Articles 2044 et seq. of
the French civil Code.
	 
	7.2	 	The execution of this Settlement Agreement shall be deemed a settlement agreement within the
meaning of Articles 2044 et seq. of the French civil Code.
	 
	7.3	 	This Settlement Agreement is prepared in English and this version will be binding.
	 
	7.4	 	This Settlement Agreement replaces all oral or written agreements entered into between the
Parties hereto prior to its signing in relation to the conditions of the discontinuation of
the participation of Sanofi of the Uvidem Development Program. Modifications or supplements to
this Agreement — including this Article — require the written form and signature by the
Parties to become legally binding.
	 
	7.5	 	Should a provision of this Settlement Agreement be deemed invalid or become invalid or should
Settlement Agreement be incomplete, the validity of the remaining provisions shall not be
thereby affected. Instead of the invalid provision, a valid provision shall be deemed to be
agreed upon, which comes economically closest to the one intended by the parties. The same
should apply in case of an omission in Settlement Agreement.
	 
	7.6	 	The Parties undertake to keep the terms and condition, and the existence of this Settlement
Agreement strictly confidential, also after termination, unless required to disclose same
pursuant to subpoena, court order, or other regulatory or administrative directive. Notice of
such disclosure shall be made to counsel for non-disclosing party’s counsel as soon as
practicable after being put on actual notice that such disclosure is

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	 	 	compelled. It is already agreed between the Parties, that IDM Pharma Inc may require to file
this document with the US Securities and Exchange Commission (SEC) as part if its mandatory
disclosure requirement.
	 
	8.	 	DISPUTE SETTLEMENT

The Settlement Agreement shall be governed by French law.

Any dispute regarding the present Agreement and in particular regarding the interpretation of the
Agreement including those that may evolve from the question of its coming into effect as well as
those that originate from the Agreement after its termination, shall be settled by amicable
negotiations between the parties, if possible.

Any dispute arising from this Settlement Agreement or in connection with the same, shall be
resolved permanently in accordance with the Arbitration Rules of the International Chamber of
Commerce by one or more arbitrators names pursuant to these Rules. The place of arbitration shall
be Paris, and the language of Arbitration shall be English.

Made in two originals, one for each of the Parties

	 	 	 	 	 	 	 
	Paris,
the 19th Day of March 2008

	 	 	 	Paris, the 19th Day of March 2008	 	 
	 
	 	 	 	 	 	 
	/s/
Timothy P. Walbert 
	 	 	 	/s/ Laurence Debroux	 	 
	 

IDM Pharma SA

	 	 	 	 

Sanofi-Aventis
	 	 
	Represented by T. Walbert

	 	 	 	Represented by Laurence DEBROUX	 	 
	 

	 	 	 	Chief Finance Officer	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	/s/ Jean-Claude Muller	 	 
	 

	 	 	 	 
Jean-Claude
MULLER	 	 
	 

	 	 	 	Senior Vice President, Administration
and Ressources, Research &Development	 	 

Under « Signature » and name of each party’s representatives, please mention in a handwritten way
the name, position and the following formula:

« Valid for settlement according to the provisions of articles 2044 and following of the French
Civil Code. Valid for a waiver to any proceeding and action ».

6/6EX-10.1

 

Exhibit 10.1

Form of Subscription Agreement

SUBSCRIPTION AGREEMENT

May 8, 2008

The undersigned investor (the “Investor”) hereby confirms its agreement with Javelin
Pharmaceuticals, Inc. (the “Company”) as follows:

     1. This Subscription Agreement (this “Agreement”) is made as of the date set forth below
between the Company and the Investor.

     2. The Company has authorized the sale and issuance to certain investors of up to an aggregate
of [• ] shares (the “Shares”) of its common stock, par value $0.001 per share (the “Common
Stock”), for a purchase price of $2.41 per share (the “Purchase Price”).

     3. The offering and sale of the Shares (the “Offering”) is being made pursuant to (1) an
effective Registration Statement on Form S-3 (Registration No. 333-149090) filed by the Company
with the Securities and Exchange Commission (the “Commission”) (the “Registration Statement”),
which contains the base prospectus (the “Base Prospectus”) and was declared effective by the
Commission on February 12, 2008, (2) if applicable, certain “free writing prospectuses” (as that
term is defined in Rule 405 under the Securities Act of 1933, as amended), that have or will be
filed with the Commission and delivered to the Investor on or prior to the date hereof and (3) a
final prospectus supplement (the “Prospectus Supplement” and together with the Base Prospectus, the
“Prospectus”) containing certain supplemental information regarding the Shares and terms of the
Offering that will be filed with the Commission and delivered to the Investor (or made available to
the Investor by the filing by the Company of an electronic version thereof with the Commission)
along with the Company’s counterpart to this Agreement.

     4. The Company and the Investor agree that the Investor will purchase from the Company and the
Company will issue and sell to the Investor the Shares set forth below for the aggregate purchase
price set forth below. The Shares shall be purchased pursuant to the Terms and Conditions for
Purchase of Shares attached hereto as Annex I and incorporated herein by this reference as
if fully set forth herein. The Investor acknowledges that the Offering is not being underwritten
by the placement agents (the “Placement Agents”) named in the Prospectus Supplement and that there
is no minimum offering amount.

     5. The manner of settlement of the Shares purchased by the Investor shall be determined by
such Investor as follows:

Delivery by electronic book-entry at The Depository Trust Company (“DTC”), registered in the
Investor’s name and address as set forth below, and released by American Stock Transfer &
Trust Company, the Company’s transfer agent (the “Transfer Agent”) (attention: Wilbert
Myles, telephone: (718) 921-8248, to the Investor at the Closing (as defined in Section 3.1
of Annex A hereto). NO LATER THAN ONE (1) BUSINESS DAY AFTER THE EXECUTION OF THIS
AGREEMENT BY THE INVESTOR AND THE COMPANY, THE INVESTOR SHALL:

	 	(I)	 	DIRECT THE BROKER-DEALER AT WHICH THE ACCOUNT OR ACCOUNTS TO BE CREDITED WITH
THE SHARES ARE MAINTAINED TO SET UP A DEPOSIT/WITHDRAWAL AT CUSTODIAN (“DWAC”)
INSTRUCTING THE

 

 

	 	 	 	TRANSFER AGENT TO CREDIT SUCH ACCOUNT OR ACCOUNTS WITH THE SHARES, AND

	 	(II)	 	REMIT BY WIRE TRANSFER THE AMOUNT OF FUNDS EQUAL TO THE AGGREGATE PURCHASE
PRICE FOR THE SHARES BEING PURCHASED BY THE INVESTOR TO THE FOLLOWING ACCOUNT:

JPMorgan Chase Bank, N.A.

ABA # 021000021

Account Name: Javelin Pharmaceuticals, Inc.

Account Number: 777130808

Attn: Audrey Mohan

Tel: (212) 623-5087

IT IS THE INVESTOR’S RESPONSIBILITY TO (A) MAKE THE NECESSARY WIRE TRANSFER OR CONFIRM THE PROPER
ACCOUNT BALANCE IN A TIMELY MANNER AND (B) ARRANGE FOR SETTLEMENT BY WAY OF DWAC IN A TIMELY
MANNER. IF THE INVESTOR DOES NOT DELIVER THE AGGREGATE PURCHASE PRICE FOR THE SHARES OR DOES NOT
MAKE PROPER ARRANGEMENTS FOR SETTLEMENT IN A TIMELY MANNER, THE SHARES MAY NOT BE DELIVERED AT
CLOSING TO THE INVESTOR OR THE INVESTOR MAY BE EXCLUDED FROM THE CLOSING ALTOGETHER.

     6. [Intentionally Omitted].

     7. The Investor represents that, except as set forth below, (a) it has had no position, office
or other material relationship within the past three years with the Company or persons known to it
to be affiliates of the Company, (b) it is not a NASD member or an Associated Person (as such term
is defined under the NASD Membership and Registration Rules Section 1011) as of the Closing, and
(c) neither the Investor nor any group of Investors (as identified in a public filing made with the
Commission) of which the Investor is a part in connection with the Offering of the Shares,
acquired, or obtained the right to acquire, 20% or more of the Common Stock (or securities
convertible into or exercisable for Common Stock) or the voting power of the Company on a
post-transaction basis.

     Exceptions:

(If no exceptions, write “none.” If left blank, response will be deemed to be “none.”)

     8. The Investor represents that it has received or can obtain on the Commission’s EDGAR filing
system the Base Prospectus, which is part of the Company’s Registration Statement, the documents
incorporated by reference therein, and any free writing prospectus (collectively, the “Disclosure
Package”), prior to or in connection with the receipt of this Agreement along with the Company’s
counterpart to this Agreement.

     9. No offer by the Investor to buy Shares will be accepted and no part of the Purchase Price
will be delivered to the Company until the Company has accepted such offer by countersigning a copy
of this Agreement, and any such offer may be withdrawn or revoked, without obligation or commitment
of any kind, at any time prior to the Company (or a Placement Agent on behalf of the Company)
sending (orally, in writing, or by electronic mail) notice of its acceptance of such offer. An
indication of interest will

Page 2

 

 

involve no obligation or commitment of any kind until this Agreement is accepted and
countersigned by or on behalf of the Company.

Number of Shares:                                        

Purchase Price Per Share: $2.41

Aggregate Purchase Price: $                                        

Please confirm that the foregoing correctly sets forth the agreement between us by signing in the
space provided below for that purpose.

Dated as of May [• ], 2008

	 	 	 	 	 
	 

	 	 	 	 
	 

	 	INVESTOR	 	 
	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	Name:	 	 
	 

	 	 	 	 
	 

	 	Title:	 	 
	 

	 	 	 	 
	 

	 	Address:	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	 
	 

	 	 	 	 

	 	 	 	 	 
	Agreed and accepted this	 	 
	 

	 	 

	 	 
	day of
                     2008:	 	 
	 
	 	 	 	 
	JAVELIN PHARMACEUTICALS, INC.

	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

	 	 
	Name:
	 	 	 	 
	 

	 	 

	 	 
	Title:
	 	 	 	 
	 

	 	 

	 	 

Page 3

 

 

ANNEX I

TERMS AND CONDITIONS FOR PURCHASE OF SHARES

     1. Authorization and Sale of the Shares. Subject to the terms and conditions of this
Agreement, the Company has authorized the sale of the Shares.

     2. Agreement to Sell and Purchase the Shares; Placement Agents.

     2.1 At the Closing (as defined in Section 3.1 of this Annex I), the Company will sell to the
Investor, and the Investor will purchase from the Company, upon the terms and conditions set forth
herein, the number of Shares set forth on the last page of the Agreement to which these Terms and
Conditions for Purchase of Shares are attached as Annex I (the “Signature Page”) for the
aggregate purchase price therefor set forth on the Signature Page.

     2.2 The Company proposes to enter into substantially this same form of Subscription Agreement
with certain other investors (the “Other Investors”) and expects to complete sales of Shares to
them. The Investor and the Other Investors are hereinafter sometimes collectively referred to as
the “Investors,” and this Agreement and the Subscription Agreements executed by the Other Investors
are hereinafter sometimes collectively referred to as the “Agreements.”

     2.3 The Investor acknowledges that the Company intends to pay Leerink Swann, LLC and Riverbank
Capital Securities, Inc. (collectively, the “Placement Agents”) a fee (the “Placement Fee”) in
respect of the sale of Shares to the Investor.

     2.4
The Company has entered into a Placement Agency Agreement, dated May 8, 2008 (the
“Placement Agreement”), with the Placement Agents that contains certain representations,
warranties, covenants, and agreements of the Company that may be relied upon by the Investor, which
shall be a third party beneficiary thereof. A copy of the Placement Agreement is available upon
request.

3. Closings and Delivery of the Shares and Funds.

     3.1 Closing. The completion of the purchase and sale of the Shares (the “Closing”) shall
occur at a place and time (the “Closing Date”) to be specified by the Company and the Placement
Agents, and of which the Investors will be notified in advance by the Placement Agents, in
accordance with Rule 15c6-1 promulgated under the Securities Exchange Act of 1934, as amended (the
“Exchange Act”). At the Closing, (a) the Company shall cause the Transfer Agent to deliver to the
Investor the number of Shares set forth on the Signature Page registered in the name of the
Investor or, if so indicated on the Investor Questionnaire attached hereto as Schedule A,
in the name of a nominee designated by the Investor and (b) the aggregate purchase price for the
Shares being purchased by the Investor will be delivered by or on behalf of the Investor to the
Company.

     3.2 (a) Conditions to the Company’s Obligations. The Company’s obligation to issue and sell
the Shares to the Investor shall be subject to: (i) the receipt by the Company of the purchase
price for the Shares being purchased hereunder as set forth on the Signature Page and (ii) the
accuracy of the representations and warranties made by the Investor and the fulfillment of those
undertakings of the Investor to be fulfilled prior to the Closing Date.

          (b) Conditions to the Investor’s Obligations. The Investor’s obligation to purchase the
Shares will be subject to the accuracy of the representations and warranties made by the Company
and the fulfillment of those undertakings of the Company to be fulfilled prior to the Closing Date
that are

Annex I — Page 1

 

 

contained in the Placement Agreement and the Subscription Agreement, and to the condition that
the Placement Agents shall not have: (i) terminated the Placement Agreement pursuant to the terms
thereof or (ii) determined that the conditions to the closing in the Placement Agreement have not
been satisfied. The Investor’s obligations are expressly not conditioned on the purchase by any or
all of the Other Investors of the Shares that they have agreed to purchase from the Company or the
issuance of any minimum amount of Shares by the Company.

     3.3 Delivery of Funds by Electronic Book-Entry at The Depository Trust Company. No later
than one (1) business day after the execution of this Agreement by the Investor and the
Company, the Investor shall remit by wire transfer the amount of funds equal to the aggregate
purchase price for the Shares being purchased by the Investor to the following account designated
by the Company and the Placement Agents pursuant to the terms of that certain Escrow Agreement (the
“Escrow Agreement”) dated as of May 8, 2008, by and among the Company, the Placement Agents
and JPMorgan Chase Bank, N.A. (the “Escrow Agent”):

JPMorgan Chase Bank, N.A.

ABA # 021000021

Account Name: Javelin Pharmaceuticals, Inc.

Account Number: 777130808

Attn: Audrey Mohan

Tel: (212) 623-5087

     Such funds shall be held in escrow until the Closing and delivered by the Escrow Agent on
behalf of the Investors to the Company upon the satisfaction, in the reasonable judgment of the
Placement Agents, of the conditions set forth in Section 3.2(b) hereof. The Placement Agents shall
have no rights in or to any of the escrowed funds unless the Placement Agents and the Escrow Agent
are notified in writing by the Company in connection with the Closing that a portion of the
escrowed funds shall be applied to the Placement Fee in accordance with the terms of the Escrow
Agreement. The Company and the Investor agree to indemnify and hold the Escrow Agent and the
Placement Agents harmless from and against any and all losses, costs, damages, expenses and claims
(including, without limitation, court costs and reasonable attorneys fees) (“Losses”) arising under
this Section 3.3 or otherwise with respect to the funds held in escrow pursuant hereto or arising
under the Escrow Agreement, unless it is finally determined that such Losses resulted directly from
the willful misconduct or gross negligence of the Escrow Agent or the Placement Agents. Anything
in this Agreement to the contrary notwithstanding, in no event shall the Escrow Agent or the
Placement Agents be liable for any special, indirect or consequential loss or damage of any kind
whatsoever (including but not limited to lost profits), even if the Escrow Agent or the Placement
Agents have been advised of the likelihood of such loss or damage and regardless of the form of
action.

          3.4 Delivery of Shares by Electronic Book-Entry at The Depository Trust Company. No later
than one (1) business day after the execution of this Agreement by the Investor and the
Company, the Investor shall direct the broker-dealer at which the account or accounts to be
credited with the Shares being purchased by such Investor are maintained, which broker/dealer shall
be a DTC participant, to set up a Deposit/Withdrawal at Custodian (“DWAC”) instructing American
Stock Transfer & Trust Company, the Company’s transfer agent, to credit such account or accounts
with the Shares by means of an electronic book-entry delivery. Such DWAC shall indicate the
settlement date for the deposit of the Shares, which date shall be provided to the Investor by the
Placement Agents. Simultaneously with the delivery to the Company by the Escrow Agent of the funds
held in escrow pursuant to Section 3.3 above, the Company shall direct its transfer agent to credit
the Investor’s account or accounts with the Shares pursuant to the information contained in the
DWAC.

Annex I — Page 2

 

 

     4. Representations, Warranties and Covenants of the Investor.

          4.1 The Investor represents and warrants to, and covenants with, the Company that (a) the
Investor is knowledgeable, sophisticated and experienced in making, and is qualified to make
decisions with respect to, investments in shares presenting an investment decision like that
involved in the purchase of the Shares, including investments in securities issued by the Company
and investments in comparable companies, and has requested, received, reviewed and considered all
information it deemed relevant in making an informed decision to purchase the Shares, (b) the
Investor has answered all questions on the Signature Page and the Investor Questionnaire for use in
preparation of the Prospectus Supplement and the answers thereto are true and correct as of the
date hereof and will be true and correct as of the Closing Date and (c) the Investor, in connection
with its decision to purchase the number of Shares set forth on the Signature Page, has reviewed
the Disclosure Package and is relying only upon the Disclosure Package and the representations and
warranties of the Company contained herein and the Placement Agreement.

          4.2 The Investor acknowledges, represents and agrees that no action has been or will be taken
in any jurisdiction outside the United States by the Company or the Placement Agents that would
permit an offering of the Shares, or possession or distribution of offering materials in connection
with the issue of the Shares in any jurisdiction outside the United States where action for that
purpose is required. Each Investor outside the United States will comply with all applicable laws
and regulations in each foreign jurisdiction in which it purchases, offers, sells or delivers
Shares or has in its possession or distributes any offering material, in all cases at its own
expense. The Placement Agents are not authorized to make and have not made any representation or
use of any information in connection with the issue, placement, purchase and sale of the Shares,
except as set forth or incorporated by reference in the Disclosure Package.

          4.3 The Investor further represents and warrants to, and covenants with, the Company that
(a) the Investor has full right, power, authority and capacity to enter into this Agreement and to
consummate the transactions contemplated hereby and has taken all necessary action to authorize the
execution, delivery and performance of this Agreement, and (b) this Agreement constitutes a valid
and binding obligation of the Investor enforceable against the Investor in accordance with its
terms, except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors’ and contracting parties’ rights
generally and except as enforceability may be subject to general principles of equity (regardless
of whether such enforceability is considered in a proceeding in equity or at law) and except as the
indemnification agreements of the Investors herein may be legally unenforceable.

          4.4 The Investor understands that nothing in this Agreement, the Prospectus or any other
materials presented to the Investor in connection with the purchase and sale of the Shares
constitutes legal, tax or investment advice. The Investor has consulted such legal, tax and
investment advisors as it, in its sole discretion, has deemed necessary or appropriate in
connection with its purchase of Shares.

          4.5 Each Investor represents, warrants and agrees that, since the earlier to occur of (i) the
date on which any Placement Agent first contacted such Investor about the Offering and (ii) the
date of this Agreement, it has not engaged in any transactions in the securities of the Company
(including, without limitation, any Short Sales involving the Company’s securities). Each Investor
covenants that it will not engage in any transactions in the securities of the Company (including
Short Sales) prior to the time that the transactions contemplated by this Agreement are publicly
disclosed. Each Investor agrees that it will not use any of the Shares acquired pursuant to this
Agreement to cover any short position in the Common Stock if doing so would be in violation of
applicable securities laws. For purposes hereof, “Short Sales” include, without limitation, all
“short sales” as defined in Rule 200 promulgated under Regulation SHO under the Exchange Act,
whether or not against the box, and all types of direct and indirect stock pledges,

Annex I — Page 3

 

 

forward sales contracts, options, puts, calls, short sales, swaps, “put equivalent positions”
(as defined in Rule 16a-1(h) under the Exchange Act) and similar arrangements (including on a total
return basis), and sales and other transactions through non-US broker dealers or foreign regulated
brokers.

     5. Survival of Representations, Warranties and Agreements; Third Party Beneficiary.
Notwithstanding any investigation made by any party to this Agreement or by the Placement Agents,
all covenants, agreements, representations and warranties made by the Company and the Investor
herein will survive the execution of this Agreement, the delivery to the Investor of the Shares
being purchased and the payment therefor. The Placement Agents shall be third party beneficiaries
with respect to representations, warranties and agreements of the Investor in Section 4 hereof.

     6. Notices. All notices, requests, consents and other communications hereunder will be in
writing, will be mailed (a) if within the domestic United States by first-class registered or
certified airmail, or nationally recognized overnight express courier, postage prepaid, or by
facsimile or (b) if delivered from outside the United States, by International Federal Express or
facsimile, and will be deemed given (i) if delivered by first-class registered or certified mail
domestic, three business days after so mailed, (ii) if delivered by nationally recognized overnight
carrier, one business day after so mailed, (iii) if delivered by International Federal Express, two
business days after so mailed and (iv) if delivered by facsimile, upon electric confirmation of
receipt and will be delivered and addressed as follows:

6.1 if to the Company, to:

Javelin Pharmaceuticals, Inc.

125 CambridgePark Drive

Cambridge, MA 02140

Attention: Stephen J. Tulipano, CFO

Facsimile: (617) 349-4505

with copies to:

Pryor Cashman LLP

410 Park Avenue

Park and 55th

New York, NY 10022

Attention: Richard S. Frazer, Esq.

Facsimile: (212) 798-6312

               6.2 if to the Investor, at its address on the Signature Page hereto, or at such other address
or addresses as may have been furnished to the Company in writing.

     7. Changes. This Agreement may not be modified or amended except pursuant to an instrument in
writing signed by the Company and the Investor.

     8. Headings. The headings of the various sections of this Agreement have been inserted for
convenience of reference only and will not be deemed to be part of this Agreement.

     9. Severability. In case any provision contained in this Agreement should be invalid, illegal
or unenforceable in any respect, the validity, legality and enforceability of the remaining
provisions contained herein will not in any way be affected or impaired thereby.

Annex I — Page 4

 

 

     10. Governing Law. This Agreement will be governed by, and construed in accordance with, the
internal laws of the State of Delaware, without giving effect to the principles of conflicts of law
that would require the application of the laws of any other jurisdiction.

     11. Counterparts. This Agreement may be executed in two or more counterparts, each of which
will constitute an original, but all of which, when taken together, will constitute but one
instrument, and will become effective when one or more counterparts have been signed by each party
hereto and delivered to the other parties. The Company and the Investor acknowledge and agree that
the Company shall deliver its counterpart to the Investor along with the Base Prospectus and the
Prospectus Supplement (or the filing by the Company of an electronic version thereof with the
Commission).

     12. Confirmation of Sale. The Investor acknowledges and agrees that such Investor’s receipt
of the Company’s counterpart to this Agreement, together with the Base Prospectus and the
Prospectus Supplement (or the filing by the Company of an electronic version thereof with the
Commission), shall constitute written confirmation of the Company’s sale of Shares to such
Investor.

     13. Press Release. The Company and the Investor agree that the Company shall issue a press
release announcing the material terms of the Offering prior to the opening of the financial markets
in New York City on the business day immediately after the date hereof to the extent permitted by
applicable law and the rules and regulations of the Commission.

     14. Termination. In the event that the Placement Agreement is terminated by the Placement
Agents pursuant to the terms thereof, this Agreement shall terminate without any further action on
the part of the parties hereto.

Annex I — Page 5

 

 

SCHEDULE
A TO ANNEX I

JAVELIN
PHARMACEUTICALS, INC.

INVESTOR QUESTIONNAIRE

Pursuant to Section 3 of Annex I to the Agreement, please provide us with the following
information:

	1.	 	The exact name that your Shares are to be registered in. You may use a nominee name if
appropriate:
	 
	 	 	                                                                                

	2.	 	The relationship between the Investor and the registered holder listed in response to item 1
above:
	 
	 	 	              
              
              
                
               
    
   

3. The mailing address of the registered holder listed in response to item 1 above:

      
                
               
               
               
                  

	4.	 	The Social Security Number or Tax Identification Number of the registered holder listed in
the response to item 1 above:
	 
	 	 	                                                                                

	5.	 	Name of DTC Participant (broker-dealer at which the account or accounts to be credited with
the Shares are maintained); please include the name and telephone number of the contract
person at the broker-dealer:
	 
	 	 	                                                                                

	 
	 	 	                                                                                

	 
	 	 	                                                                                

	6.	 	DTC Participant Number:
	 
	 	 	                                                                                

	7.	 	Name of Account at DTC Participant being credited with the Shares:
	 
	 	 	                                                                                

	 
	 	 	                                                                                

	8.	 	Account Number at DTC Participant being credited with the Shares:
	 
	 	 	                                                                                

Schedule A to Annex I — Page 1

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