Document:

Exhibit 10.55

 

DEBT SETTLEMENT AGREEMENT

 

THIS DEBT SETTLEMENT AGREEMENT (“Agreement”) dated this 31st day of March, 2017 (the “Agreement Date”), is made and entered into between Dan Becka (“Becka”) Napo Pharmaceuticals, Inc., a Delaware corporation (“Company”).

 

1.              RECITALS

 

a.                                      Company is indebted to Becka for services rendered in an aggregate amount, as of March 31, 2017, equal to $513,741.27 plus any fees, costs, charges, or interest related thereto whether currently outstanding or arising after the date hereof (the “Obligation”).

 

b.                                      As a complete settlement and satisfaction of the Obligation, Company has offered, subject to the terms and conditions hereof, to pay in the Obligation by, pursuant to the Merger Agreement (as defined below), causing Jaguar (as defined below) to issue and deliver to Becka upon consummation of the Merger (as defined below) 555,395 shares of non-voting common stock of Jaguar (such shares, which shall be appropriately adjusted for any stock splits, combinations, reclassifications, reorganizations and similar transactions effected after the Effective Date as necessary to reflect the intention of the parties hereto, the “Settlement Shares”).

 

c.                                       Becka is willing to accept Company’s offer to pay in kind the Obligation by delivering the Settlement Shares to Becka upon consummation of the Merger, as a complete settlement and satisfaction of the Obligation, upon the terms and conditions set forth in this Agreement.

 

2.              CONDITIONS PRECEDENT.  The following are conditions precedent to Becka’s obligations under Section 5 of this Agreement:

 

a.                                      Receipt by Becka of a fully executed copy of this Agreement.

 

b.                                      Receipt by Becka of a fully executed copy of that certain Agreement and Plan of Merger (the “Merger Agreement”) between Company and Napo Acquisition Corporation, a Delaware corporation (“Merger Sub”), a wholly owned subsidiary of Jaguar Animal Health, Inc., a Delaware corporation (“Jaguar”) in substantially the form attached hereto as Exhibit A.

 

c.                                       The consummation of the merger between Company and Merger Sub pursuant to the terms of the Merger Agreement (the “Merger”).

 

d.                                      The representations and warranties of the Company contained in this Agreement are true and correct in all material respects on the date hereof.

 

e.                                       Upon consummation of the Merger Company shall deliver or cause to be delivered to Becka, certificates representing the Settlement Shares.

 

 

3.              COMPANY’S REPRESENTATIONS AND WARRANTIES.  Company represents and warrants that:

 

a.                                      it is duly authorized to execute this Agreement and has all requisite power, authority, and approval required to enter into, execute, and deliver this Agreement;

 

b.                                      this Agreement is the legal, valid and binding obligation of Company enforceable against Company in accordance with its terms (except as such enforcement may be limited by bankruptcy, insolvency, reorganization, receivership, moratorium or other laws or equitable principles limiting to the rights of creditors generally); and

 

c.                                       it has the right to enter into this Agreement without the consent of any third party (other than consents which have been obtained) and the execution and delivery of this Agreement does not violate any agreement to which Company is a party or otherwise bound (after giving effect to contemporaneous amendments and consents to any such agreements).

 

4.              BECKA’ REPRESENTATIONS AND WARRANTIES.  Becka represents and warrants to Company and Jaguar that:

 

a.                                      Becka has all necessary power and authority to execute and deliver this Agreement and to carry out its provisions.  All action on Becka’s part required for the lawful execution and delivery of this Agreement has been taken.  Upon its execution and delivery, this Agreement will be a valid and binding obligation of Becka, enforceable in accordance with its terms (except as such enforcement may be limited by bankruptcy, insolvency, reorganization, receivership, moratorium or other laws or equitable principles limiting to the rights of creditors generally).

 

b.                                      Becka is aware that the Settlement Shares to be issued to Becka have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), and that the Settlement Shares are deemed to constitute “restricted securities” under Rule 144 promulgated under the Securities Act (“Rule 144”).  Becka also understands that the Settlement Shares are being offered and sold pursuant to an exemption from registration contained in the Securities Act based in part upon Becka’s representations contained in this Agreement.

 

c.                                       Becka is obtaining the Settlement Shares for its own account and Becka has no present intention of distributing or selling the securities except as permitted under the Securities Act and applicable state securities laws.

 

d.                                      Becka has sufficient knowledge and experience in business and financial matters to evaluate Jaguar, its proposed activities and the risks and merits of this investment.  Becka has the ability to accept the high risk and lack of liquidity inherent in this type of investment.  Becka has conducted its own independent investigation of Jaguar and has reached its own conclusions regarding the risks and merits of this investment.  Becka is not relying upon any representations or warranties from Company or Jaguar except as explicitly set forth herein.

 

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e.                                       Becka had an opportunity to discuss Jaguar’s business, management and financial affairs with directors, officers and management of Jaguar.  Becka has also had the opportunity to ask questions of and receive answers from Jaguar and its management regarding the terms and conditions of this investment.  Becka understands the significant risks of this investment.

 

f.                                        Becka has the capacity to protect its own interests in connection with the purchase of the Settlement Shares by virtue of its business or financial expertise.

 

g.                                      Becka understands that the Settlement Shares must be held indefinitely unless they are subsequently registered under the Securities Act or an exemption from such registration is available.  Becka has been advised or is aware of the provisions of Rule 144, as in effect from time to time, which permit limited resale of shares purchased in a private placement subject to the satisfaction of certain conditions, including, among other things, the availability of certain current public information about Jaguar, the resale occurring following the required holding period under Rule 144, and the number of shares being sold during any three month period not exceeding specified limitations.

 

h.                                      Becka acknowledges and agrees that the Settlement Shares upon issuance shall bear customary restrictive legends referencing their restrictions on transfer in accordance with the Securities Act.

 

i.                                         If Becka is not a United States person (as defined by Section 7701(a)(30) of the Internal Revenue Code of 1986, as amended (the “Code”)), Becka hereby represents that Becka has satisfied itself as to the full observance of the laws of its jurisdiction in connection with any invitation to subscribe for or otherwise acquire the Settlement Shares or any use of this Agreement, including (i) the legal requirements within its jurisdiction for the purchase of the Settlement Shares, (ii) any foreign exchange restrictions applicable to such purchase, (iii) any government or other consents that may need to be obtained in connection with such purchase, and (iv) the income tax and other tax consequences, if any, that may be relevant to the purchase, holding, redemption, sale or transfer of the Settlement Shares.  Jaguar’s offer and sale and Becka’s subscription and payment for and continued beneficial ownership of (or Company’s transfer of, as applicable) the Settlement Shares will not violate any applicable securities or other laws of Becka’s jurisdiction.

 

j.                                         Becka has reviewed this Agreement in its entirety, has had an opportunity to obtain the advice of counsel prior to executing this Agreement and fully understands all provisions of this Agreement. Becka acknowledges that no other representations or warranties, oral or written, have been made by Company or any agent thereof except as set forth in this Agreement.

 

k.                                      The office or offices of Becka in which its investment decision was made is located at the address or addresses of Becka set forth on the signature page hereto.

 

l.                                         Becka is an “accredited investor” as that term is defined under Regulation D promulgated under the Securities Act.

 

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m.                                  Becka is aware that Company and Jaguar are relying on the accuracy of the above representations to establish compliance with Federal and State securities laws.  If any such warranties or representations are not true and accurate in any respect as of the Effective Date (as defined below), Becka shall so notify Company in writing immediately and shall be cause for rescission by Company at its sole election.  Becka represents that neither Becka, nor any person or entity with whom Becka shares beneficial ownership of Jaguar’s securities, is subject to any of the “Bad Actor” disqualifications described in Rule 506(d)(1)(i) to (viii) under the Securities Act, attached hereto as Annex I.

 

5.              BECKA’S OBLIGATIONS AND AGREEMENTS.  Upon satisfaction (or waiver by Becka) of the conditions precedent in Section 2 of this Agreement (the “Effective Date”), Becka agrees that:

 

a.                                      the Obligation shall be deemed paid in full and extinguished;

 

b.                                      all security interests and liens granted to Becka on any personal property (including, but not limited to, any intellectual property) and real property of the Company and any of its affiliates, if any, are automatically terminated and of no further force and effect;

 

c.                                       the Company, its affiliates and designees are hereby authorized to file on behalf of Becka, all Uniform Commercial Code termination statements with respect to any UCC financing statements filed by or on behalf of Becka against the Company or any of its affiliates, including, without limitation, the UCC-1;

 

d.                                      Becka will promptly deliver such documents and take such other actions as Company may request in order to effectuate the termination of the Obligation and the release and termination of its security interests in the property of Company and its affiliates; and

 

e.                                       Becka will reflect on its books and records that the Obligation has been paid in full.

 

6.              FORBEARANCE.  In reliance upon Company’s representations, warranties and covenants contained in this Agreement, and subject to the terms and conditions of this Agreement, Becka hereby agrees, during the period commencing on the Agreement Date and ending at 5:00 pm Eastern Time on July 31, 2017 to forbear from exercising any of its rights and remedies relating to the Obligation or in any way seeking to collect the Obligation except as expressly contemplated in this Agreement, including, without limitation, by commencing any proceeding with respect thereto.

 

7.              MUTUAL RELEASE.  In consideration of the agreements set forth herein, Company, and Becka hereby agree as follows, effective upon consummation of the Merger:

 

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a.                                      Release by Company:

 

i.            Company does hereby release, acquit and forever discharge Becka, and its respective past and present officers, directors, attorneys, affiliates, employees and agents, of and from any and all claims, demands, obligations, liabilities, indebtedness, breaches of contract, breaches of duty or of any relationship, acts, omissions, misfeasance, malfeasance, causes of action, defenses, offsets, debts, sums of money, accounts, compensation, contracts, controversies, promises, damages, costs, losses and expenses, of every type, kind, nature, description or character, whether known or unknown, suspected or unsuspected, liquidated or unliquidated, each as though fully set forth herein at length (each, a “Company Released Claim” and collectively, the “Company Released Claims”), that Company hereunder has as of the date of the consummation of the Merger or may acquire in any way arising out of, connected with or related to the Obligation.

 

ii.        Each person signing below on behalf of Company hereunder acknowledges that he or she has read each of the provisions of this Section 7(a).  Each such person fully understands that this Section 7(a) has important legal consequences, and each such person realizes that they are releasing any and all Company Released Claims that Company may have.  Company hereby acknowledges that each of them has had an opportunity to obtain a lawyer’s advice concerning the legal consequences of each of the provisions of this Section 7(a).

 

iii.    Company hereby specifically acknowledges and agrees that:  (i) none of the provisions of this Section 7(a) shall be construed as or constitute an admission of any liability on the part of Becka; (ii) the provisions of this Section 7(a) shall constitute an absolute bar to any Company Released Claim of any kind, whether any such Company Released Claim is based on contract, tort, warranty, mistake or any other theory, whether legal, statutory or equitable; and (iii) any attempt to assert a Company Released Claim barred by the provisions of this Section 7(a) shall subject Company to the provisions of applicable law setting forth the remedies for the bringing of groundless, frivolous or baseless claims or causes of action.

 

iv.     Company expressly waives any and all rights and benefits conferred upon it by Section 1542 of the Civil Code of the State of California (and any similar or like statute or other law which may be applicable), which states as follows:

 

“A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.”

 

Company expressly agrees and understands that the release given by it pursuant to this provision applies to all unknown, unsuspected and

 

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unanticipated Claims which it may have against Becka that it has released.  Company understands and acknowledges that the significance and consequence of this waiver of Section 1542 of the California Civil Code (and any similar or like statute or other law which may be applicable) is that even if it should eventually suffer additional damages relating in any way to any dispute, that Company will not be permitted to make any claim for those damages against Becka that it has released pursuant to this Agreement.  Furthermore, Company acknowledges that it intends these consequences even as to claims for damages that may now exist as of the date of this Agreement but which are not known to exist, and which, if known would materially affect its decision to execute these releases, regardless of whether their lack of knowledge, or the lack of knowledge of any one of them, is the result of ignorance, oversight, error, negligence, or any other cause.

 

b.                                      Release by Becka.

 

i.            Becka, for itself and on behalf of its respective successors and assigns, does hereby release, acquit and forever discharge Company and Jaguar and all of their respective past and present officers, directors, attorneys, affiliates, employees and agents, of and from any and all claims, demands, obligations, liabilities, indebtedness, breaches of contract, breaches of duty or of any relationship, acts, omissions, misfeasance, malfeasance, causes of action, defenses, offsets, debts, sums of money, accounts, compensation, contracts, controversies, promises, damages, costs, losses and expenses, of every type, kind, nature, description or character, whether known or unknown, suspected or unsuspected, liquidated or unliquidated, each as though fully set forth herein at length (each, a “Becka Released Claim” and collectively, the “Becka Released Claims”), that Becka hereunder now has as of the date of the consummation of the Merger or may acquire in any way arising out of, connected with or related to the Obligation.

 

ii.        Each person signing below on behalf of Becka hereunder acknowledges that he or she has read each of the provisions of this Section 7(b).  Each such person fully understands that this Section 7(b) has important legal consequences, and each such person realizes that they are releasing any and all Becka Released Claims that Becka may have.  Becka hereunder hereby acknowledge that each of them has had an opportunity to obtain a lawyer’s advice concerning the legal consequences of each of the provisions of this Section 7(b).

 

iii.    Becka hereby specifically acknowledge and agree that:  (i) none of the provisions of this Section 7(b) shall be construed as or constitute an admission of any liability on the part of Company; (ii) the provisions of this Section 7(b) shall constitute an absolute bar to any Becka Released

 

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Claim of any kind, whether any such Becka Released Claim is based on contract, tort, warranty, mistake or any other theory, whether legal, statutory or equitable; and (iii) any attempt to assert a Becka Released Claim barred by the provisions of this Section 7(b) shall subject Becka to the provisions of applicable law setting forth the remedies for the bringing of groundless, frivolous or baseless claims or causes of action.

 

iv.     Becka expressly waives any and all rights and benefits conferred upon it by Section 1542 of the Civil Code of the State of California (and any similar or like statute or other law which may be applicable), which states as follows:

 

“A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.”

 

Becka expressly agrees and understands that the release given by it pursuant to this provision applies to all unknown, unsuspected and unanticipated Claims which it may have against the Company that it has released.  Becka understands and acknowledges that the significance and consequence of this waiver of Section 1542 of the California Civil Code (and any similar or like statute or other law which may be applicable) is that even if it should eventually suffer additional damages relating in any way to any dispute, that Becka will not be permitted to make any claim for those damages against the Company that it has released pursuant to this Agreement.  Furthermore, Becka acknowledges that it intends these consequences even as to claims for damages that may now exist as of the date of this Agreement but which are not known to exist, and which, if known would materially affect its decision to execute these releases, regardless of whether their lack of knowledge, or the lack of knowledge of any one of them, is the result of ignorance, oversight, error, negligence, or any other cause.

 

8.                                      REGISTRATION RIGHTS.  Company represents that as a condition of the Merger Agreement, and Company and Becka agree, that the following terms shall be effective upon consummation of the Merger:

 

a.                                      No later than thirty (30) days following the consummation of the Merger (the “Filing Date”), Jaguar shall prepare and file with the Securities and Exchange Commission (the “Commission”), a Registration Statement on Form S-3 (or such other form available) covering the public resale of the Settlement Shares and shall cause such Registration Statement to be filed by the Filing Date for such Registration Statement and use reasonable best efforts to have the Registration Statement declared effective under the Securities Act as soon as possible thereafter (the “Effectiveness Date”).  Jaguar shall use its reasonable best efforts to keep such Registration Statement continuously effective under the Securities Act during the entire Effectiveness Period.

 

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b.                                      Becka agrees to furnish to Jaguar a completed selling stockholder questionnaire in the customary form to be presented to Becka.  Jaguar shall not be required to include the Settlement Shares in the Registration Statement if Becka fails to furnish to Jaguar a fully completed questionnaire at least two Trading Days prior to the Effectiveness Date.

 

c.                                       Notwithstanding anything in this Section to the contrary, Jaguar may delay or suspend the effectiveness of the Registration Statement for up to thirty (30) days (a “Delay Period”) if the board of directors of Jaguar determines in good faith that (i) effectiveness of the Registration Statement must be suspended in accordance with the rules and regulations under the Securities Act or that (ii) the disclosure of material non-public information (“Pending Developments”) at such time would be detrimental to Jaguar and its subsidiaries, taken as a whole.  Notwithstanding the foregoing, Jaguar shall use its reasonable best efforts to ensure that the Registration Statement is declared effective and its permitted use is resumed following a Delay Period as promptly as practicable.

 

d.                                      In addition to the covenants set forth herein, following the consummation of the Merger, Jaguar shall:

 

(i)                                     furnish to Becka such reasonable number of copies of the registration statement, preliminary prospectus, final prospectus and such other documents as it may reasonably request in order to facilitate the public offering of the Settlement Shares;

 

(ii)                                  use its reasonable best efforts to register or qualify the Settlement Shares under such state securities or blue sky laws of such jurisdictions as Becka may reasonably request in writing within twenty (20) days following the original filing of such registration statement, except that Jaguar shall not for any purpose be required to execute a general consent to service of process or to qualify to do business as a foreign corporation in any jurisdiction wherein it is not so qualified;

 

(iii)                               notify Becka, promptly after it shall receive notice thereof, of the time when such registration statement or a supplement to any prospectus forming a part of such registration statement has become effective;

 

(iv)                              notify Becka promptly of any request by the Staff of the Commission for the amending or supplementing of such registration statement or prospectus or for additional information;

 

(v)                                 prepare and file with the Commission any amendments or supplements to such registration statement or prospectus which is required under the Securities Act or the rules and regulations promulgated thereunder in connection with the distribution of the Settlement Shares;

 

(vi)                              prepare and promptly file with the Commission and promptly notify Becka of the filing of such amendment or supplement to such registration statement or prospectus as may be necessary to correct any statements or omissions if, at the time when a prospectus relating to the Settlement Shares is required to be delivered

 

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under the Securities Act, any event shall have occurred as the result of which any such prospectus or any other prospectuses then in effect would include an untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances in which they were made, not misleading;

 

(vii)                           advise Becka promptly after it shall receive notice or obtain knowledge thereof, of the issuance of any stop order by the Division of Enforcement of the Commission suspending the effectiveness of such registration statement or the initiation or threatening of any proceeding for that purpose and promptly use its reasonable best efforts to prevent the issuance of any stop order or to obtain its withdrawal if such stop order should be issued; and

 

(viii)                        indemnify and hold harmless Becka against any and all losses, claims, damages or liabilities to which Becka shall become subject, under the Securities Act or otherwise, that arise out of or are based upon any untrue statement or alleged untrue statement of any material fact contained in the effective registration statement or any prospectus that forms a part thereof or any amendment or supplement thereto, or arise out of or are based upon any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; provided, however, that no such indemnification shall be available to Becka (and Becka shall indemnify and hold harmless Jaguar) with respect to, and to the extent there is liability attributable to, written information provided by Becka to Jaguar for use in such registration statement or prospectus thereunder or any amendment or supplement thereto, or any related preliminary prospectus.

 

e.                                       All fees and expenses incident to the performance of or compliance with this Section by Jaguar shall be borne by Jaguar whether or not any Settlement Shares are sold pursuant to a Registration Statement.

 

f.                                        As used in this Section, the following terms have the respective meanings:

 

“Change of Control” means (i) any merger, consolidation or other business combination of Jaguar with any entity in which the stockholders of Jaguar immediately prior to such transaction in the aggregate cease to own at least 50% of the voting power of the voting securities of the entity surviving or resulting from such transaction (or the ultimate parent thereof), or (ii) any sale, transfer, lease, assignment or other disposal of all or substantially all of the assets of Jaguar and its subsidiaries, taken as a whole.

 

“Effectiveness Period” means, the period commencing on the Effectiveness Date of the Registration Statement and ending on the earlier of (i) the time as all of the Settlement Shares covered by such Registration Statement have been sold (either pursuant to a Registration Statement or otherwise), (ii) the time as all of the Settlement Shares are eligible to be sold by the Holders without compliance with the volume limitations or public information requirements of Rule 144; or (iii) a Change of Control.

 

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“Holder” or “Holders” means the holder or holders, as the case may be, from time to time, of the Settlement Shares.

 

“Registration Statement” means the registration statements required to be filed in accordance with this Section and any additional registration statements required to be filed under this this Section, including in each case the prospectus, amendments and supplements to such registration statements or prospectus, including pre and post effective amendments, all exhibits thereto, and all material incorporated by reference or deemed to be incorporated by reference therein.

 

“Trading Day” means a day on which the Nasdaq Stock Market is open for trading.

 

9.              GENERAL PROVISIONS

 

a.                                      Each party to this Agreement acknowledges and warrants that it has been represented by independent counsel of its own choice throughout all negotiations which preceded the negotiation and execution of this Agreement.  Each party has read or had read to it all of this Agreement and had it explained to it by its attorney and fully understands all the terms used and their significance;

 

b.                                      The parties hereto are sophisticated and have been represented by attorneys throughout the transactions contemplated hereby who have carefully negotiated the provisions hereof.  As a consequence, the parties do not intend that the presumptions of laws or rules relating to the interpretation of contracts against the drafter of any particular clause should be applied to this Agreement or any agreement or instrument executed in connection herewith, and therefore waive their effects;

 

c.                                       Each of the parties to this Agreement shall bear its own expenses with respect to the negotiation, execution, delivery and enforcement of this Agreement, the transactions referenced herein and all other transactions relating hereto;

 

d.                                      This Agreement contains the entire agreement and understanding concerning the subject matter hereof between the parties, and supersedes and replaces all prior negotiations, proposed agreements and agreements written or oral.  Each of the parties to this Agreement acknowledges that no other party to this Agreement, nor any agent or attorney of any such party, has made any promise, representation or warranty whatsoever, express or implied, not contained in this Agreement, to induce him to execute this Agreement.  Each of the parties further acknowledge that he is not executing this Agreement in reliance on any promise, representation or warranty not contained in this Agreement;

 

e.                                       Whenever, in this Agreement, the context may so require, the masculine or neuter gender shall be deemed to refer to and include the feminine, masculine, and neuter, and the singular to refer to and include the plural;

 

f.                                        This Agreement shall in all respects be interpreted, enforced and governed by the laws of the State of New York (without reference to conflict of laws rules or principles);

 

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g.             Jaguar is an intended third-party beneficiary of this Agreement;

 

h.             This Agreement may be executed in several counterparts, all of which shall be an original and enforceable against any party who signed it, and all of which shall constitute one and the same document.  Signatures submitted via facsimile or .pdf email shall be acceptable to bind the parties hereunder;

 

i.              CONFIDENTIALITY.  The parties agree that the terms of this Agreement, the information contained in this Agreement and all information delivered by or on behalf of Company pursuant to or in connection with this agreement shall remain strictly confidential and neither Becka nor Company, shall release any such information to any other person or entity (other than Jaguar, Dorsar Investment Company, Alco Investment Company, Two Daughters LLC, Boies, Schiller & Flexner LLP, Dan Becka, Nantucket Investments Limited and any lender to or equity holder in Company or Jaguar and their respective officers, directors, shareholders, attorneys and advisors), without the prior written consent of the other parties hereto.  Notwithstanding the foregoing, prior written consent of Becka shall not be required for the disclosure of information regarding this Agreement to Company’s officers, directors, shareholders, attorneys and advisors and to the extent required by legal process or court order;

 

j.              EXCLUSIVE JURISDICTION. BECKA AND COMPANY AGREE THAT ALL ACTIONS TO ENFORCE THIS AGREEMENT AND ALL DISPUTES AMONG OR BETWEEN THEM ARISING OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG OR BETWEEN THEM IN CONNECTION WITH THIS AGREEMENT, AND WHETHER ARISING IN CONTRACT, TORT, EQUITY, OR OTHERWISE, SHALL BE RESOLVED ONLY BY A COURT LOCATED IN NEW YORK, NEW YORK, AND BECKA AND COMPANY HEREBY CONSENT AND SUBMIT TO THE JURISDICTION OF SUCH COURT;

 

k.             WAIVER OF RIGHT TO TRIAL BY JURY.  EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER THIS AGREEMENT, OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO THE AGREEMENT (AS NOW OR HEREAFTER MODIFIED) OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH, OR THE TRANSACTIONS RELATED HERETO OR THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY; AND

 

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l.              Wherever possible, each provision of this Agreement shall be interpreted in such manner as to be valid under applicable law.  To the extent any such provision is found to be invalid or unenforceable under applicable law in a given jurisdiction, then (a) such provision shall be ineffective only to such extent; (b) the remainder of such provision and the other provisions of this Agreement shall remain in full force and effect in such jurisdiction; and (c) such provision shall remain in full force and effect in any other jurisdiction.

 

[The remainder of this page is intentionally left blank.  Signatures follow.]

 

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IN WITNESS WHEREOF, Company and Becka have caused this Agreement to be duly executed as of the date first written above.

 

	
 
    	
COMPANY:
    
	
 
    	
 
    
	
 
    	
NAPO   PHARMACEUTICALS, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Lisa A. Conte
    
	
 
    	
 
    	
Name:   Lisa A. Conte
    
	
 
    	
 
    	
Title:   Chief Executive Officer
    
	
 
    	
 
    
	
 
    	
BECKA:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/   Dan Becka
    
	
 
    	
Dan   Becka
    

 

Signature Page to

Debt Settlement Agreement (Becka)

 

 

ANNEX I

 

BAD ACTOR

Rule 506(d)(1)(i) to (viii) under the Securities Act of 1933, as amended

 

(i) Has been convicted, within ten years before such sale (or five years, in the case of issuers, their predecessors and affiliated issuers), of any felony or misdemeanor:

 

(A) In connection with the purchase or sale of any security;

(B) Involving the making of any false filing with the Commission; or

(C) Arising out of the conduct of the business of an underwriter, broker, dealer, municipal securities dealer, investment adviser or paid solicitor of purchasers of securities;

 

(ii) Is subject to any order, judgment or decree of any court of competent jurisdiction, entered within five years before such sale, that, at the time of such sale, restrains or enjoins such person from engaging or continuing to engage in any conduct or practice:

 

(A) In connection with the purchase or sale of any security;

(B) Involving the making of any false filing with the Commission; or

(C) Arising out of the conduct of the business of an underwriter, broker, dealer, municipal securities dealer, investment adviser or paid solicitor of purchasers of securities;

 

(iii) Is subject to a final order of a state securities commission (or an agency or officer of a state performing like functions); a state authority that supervises or examines banks, savings associations, or credit unions; a state insurance commission (or an agency or officer of a state performing like functions); an appropriate federal banking agency; the U.S. Commodity Futures Trading Commission; or the National Credit Union Administration that:

 

(A) At the time of such sale, bars the person from:

 

(1) Association with an entity regulated by such commission, authority, agency, or officer;

(2) Engaging in the business of securities, insurance or banking; or

(3) Engaging in savings association or credit union activities; or

 

(B) Constitutes a final order based on a violation of any law or regulation that prohibits fraudulent, manipulative, or deceptive conduct entered within ten years before such sale;

 

(iv) Is subject to an order of the Commission entered pursuant to section 15(b) or 15B(c) of the Securities Exchange Act of 1934 (15 U.S.C. 78o(b) or 78o-4(c)) or section 203(e) or (f) of the Investment Advisers Act of 1940 (15 U.S.C. 80b-3(e) or (f)) that, at the time of such sale:

 

(A) Suspends or revokes such person’s registration as a broker, dealer, municipal securities dealer or investment adviser;

(B) Places limitations on the activities, functions or operations of such person; or

(C)Bars such person from being associated with any entity or from participating in the offering of any penny stock;

 

(v) Is subject to any order of the Commission entered within five years before such sale that, at the time of such sale, orders the person to cease and desist from committing or causing a violation or future violation of:

 

(A) Any scienter-based anti-fraud provision of the federal securities laws, including without limitation section 17(a)(1) of the Securities Act of 1933 (15 U.S.C. 77q(a)(1)), section 10(b) of the Securities Exchange Act of 1934 (15 U.S.C. 78j(b)) and 17 CFR 240.10b-5, section 15(c)(1) of the Securities Exchange Act of 1934 (15 U.S.C. 78o(c)(1)) and section 206(1) of the Investment Advisers Act of 1940 (15 U.S.C. 80b-6(1)), or any other rule or regulation thereunder; or

(B) Section 5 of the Securities Act of 1933 (15 U.S.C. 77e).

 

(vi) Is suspended or expelled from membership in, or suspended or barred from association with a member of, a registered national securities exchange or a registered national or affiliated securities association for any act or omission to act constituting conduct inconsistent with just and equitable principles of trade;

 

(vii) Has filed (as a registrant or issuer), or was or was named as an underwriter in, any registration statement or Regulation A offering statement filed with the Commission that, within five years before such sale, was the subject of a refusal order, stop order, or order suspending the Regulation A exemption, or is, at the time of such sale, the subject of an investigation or proceeding to determine whether a stop order or suspension order should be issued; or

 

(viii) Is subject to a United States Postal Service false representation order entered within five years before such sale, or is, at the time of such sale, subject to a temporary restraining order or preliminary injunction with respect to conduct alleged by the United States Postal Service to constitute a scheme or device for obtaining money or property through the mail by means of false representations.Exhibit 10.57

 

FORM OF ESCROW AGREEMENT

 

THIS ESCROW AGREEMENT (this “Agreement”) is made and entered into as of           , 2017, by and among Jaguar Animal Health, Inc., a Delaware corporation, (“Jaguar”), Nantucket Investments Limited, a company organized under the laws of Guernsey (“Nantucket” and, together with Jaguar, sometimes referred to individually as a “Party” and collectively as the “Parties”), and Citibank, National Association, as escrow agent (the “Escrow Agent”).  Capitalized terms not defined herein shall have the meanings assigned to them in that certain Investor Rights Agreement, dated as of March 31, 2017 (as may be amended from time to time, the “Investor Rights Agreement”), by and between Jaguar and Nantucket.

 

RECITALS

 

WHEREAS, the Investor Rights Agreement contemplates the execution and delivery of this Agreement and the deposit by Jaguar with the Escrow Agent of             shares of Jaguar convertible non-voting common stock, par value $0.0001 per share, which are subject to the terms of the Investor Rights Agreement, including Section 2.3 therein, and registered in the name of Nantucket (the “Escrowed Shares”);

 

WHEREAS, Nantucket agrees to execute and deliver to the Escrow Agent a stock assignment separate from certificate duly executed in blank by Nantucket with medallion guarantee (the “Stock Assignment”); and

 

WHEREAS, the Escrow Agent agrees to hold and deliver the Escrowed Shares and the Stock Assignment in accordance with the terms of this Agreement.

 

NOW THEREFORE, in consideration of the foregoing and of the mutual covenants hereinafter set forth, the parties hereto agree as follows:

 

1.                                      Appointment.  The Parties hereby appoint the Escrow Agent as their escrow agent for the purposes set forth herein, and the Escrow Agent hereby accepts such appointment and agrees to act as escrow agent in accordance with the terms and conditions set forth herein.

 

2.                                      Escrowed Shares.  Simultaneous with the Closing, Jaguar is depositing the Escrowed Shares with the Escrow Agent and Nantucket is delivering the Stock Assignment to the Escrow Agent.  The Escrow Agent hereby acknowledges receipt of the Escrowed Shares and the Stock Assignment (together, the “Escrowed Property”) in a separate and distinct account (the “Escrow Account”), subject to the terms and conditions of this Agreement. Nantucket shall be entitled to exercise all voting rights with respect to the Escrowed Shares so long as such shares are held by the Escrow Agent and Jaguar shall take all reasonable steps to allow the exercise of such rights.  Except for dividends paid in securities or the distribution of rights to purchase additional securities, which in each case shall be held in escrow as Escrowed Property to be distributed in accordance with the terms hereof, any and all dividends, distributions or other income paid on or made in respect of any Escrowed Shares shall belong to Nantucket and shall be promptly delivered to Nantucket by the Escrow Agent following its receipt thereof.  While the Escrowed Shares are held in the Escrow Account, Nantucket will retain and will be able to 

 

 

exercise all other rights of ownership of such shares which are not inconsistent with the terms and conditions of this Agreement or the Investor Rights Agreement.

 

3.                                      Transferability.  The Escrowed Shares shall not be assignable or transferable unless and until the Escrowed Shares are released in accordance with the terms hereof.

 

4.                                      Account Activity. The Escrow Agent shall send an account statement to each of the Parties on a monthly basis reflecting activity in the Escrow Account for the preceding month.  No statement need be rendered for the Escrow Account if no activity occurred for such month.

 

5.                                      Disposition and Termination of the Escrowed Property.

 

(a)                                 Escrowed Property.  The Parties shall act in accordance with, and the Escrow Agent shall hold and release the Escrowed Shares as provided in, this Section 5(a), subject to the terms and conditions of the Investor Rights Agreement, as follows:

 

(i)                                                       Upon receipt of a Joint Release Instruction with respect to the Escrowed Property, the Escrow Agent shall promptly, but in any event within two (2) Business Days after receipt of a Joint Release Instruction, disburse all or part of the Escrowed Property in accordance with such Joint Release Instruction.

 

(ii)                                                    If at any time either of the Parties receives a Final Determination, then upon receipt by the Escrow Agent of a copy of such Final Determination from any Party, the Escrow Agent shall (A) promptly deliver a copy of such Final Determination to the other Party and (B) on the fifth (5th) Business Day following receipt by the applicable Party from the Escrow Agent of the Final Determination, disburse as directed, part or all, as the case may be, of the Escrowed Property in accordance with such Final Determination.  Subject to the terms of this Section 5(a), the Escrow Agent shall be entitled to reasonably rely on any such Final Determination and shall have no responsibility to make any determination as to whether such Final Determination is final and non-appealable or is from a court of competent jurisdiction.

 

(iii)                                                 All disbursements of any part of the Escrowed Property shall be made as set forth in the Joint Release Instruction or Final Determination, as applicable.

 

(iv)                                                In the event a Joint Release Instruction is delivered to the Escrow Agent, whether in writing, by telecopier, by e-mail or otherwise, the Escrow Agent is authorized to seek confirmation of such instruction by telephone call back to the person or persons designated in Exhibits A-1 and or A-2 annexed hereto (the “Call Back Authorized Individuals”), and the Escrow Agent may rely upon the confirmations of anyone purporting to be a Call Back Authorized Individual.  To assure the accuracy of the instructions it receives, the Escrow Agent may record such call backs.  If the Escrow Agent is unable to verify the instructions, or is not satisfied with the verification it receives, it will not execute the instruction until all such issues have been resolved.  The persons and telephone numbers for call backs may be changed only in writing actually received and acknowledged by the Escrow Agent from the Party entitled to designate such Call Back Authorized Individuals.

 

(v)                                 Notwithstanding anything to the contrary herein, in the event that less than all of the Escrowed Shares are released pursuant to a Joint Release Instruction or a

 

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Final Determination, then any shares that are not so released shall remain held by the Escrow Agent in the Escrow Account and shall constitute “Escrowed Shares” until such time as the Escrow Agent receives a Joint Release Instruction or a Final Determination in respect of such remaining shares in accordance with the terms and conditions of this Section 5(a).  The Escrow Agent acknowledges and agrees that the Parties may, from time to time after the date hereof, acting jointly pursuant to Joint Release Instructions or other written instructions signed by both Parties, deposit with the Escrow Agent one or more replacement stock certificates representing the Escrowed Shares in lieu of any stock certificates that may then be held in the Escrow Account.

 

(b)                                 Certain Definitions.

 

(i)                                     “Business Day” means any day that is not a Saturday, a Sunday or other day on which banks are not required or authorized by law to be closed in San Francisco, California or New York, New York.

 

(ii)           “Final Determination” means a final non-appealable order of any court of competent jurisdiction directing delivery of all or a portion of the Escrowed Property, as applicable, which shall be accompanied by (A) a certificate executed by a duly authorized officer or director of the prevailing Party to the effect that such judgment is final and non-appealable and from a court of competent jurisdiction having proper authority and (B) the written delivery instructions of the prevailing Party.

 

(iii)          “Joint Release Instruction” means the joint written instruction of Nantucket and Jaguar, which is executed by Nantucket and Jaguar, to the Escrow Agent directing the Escrow Agent to disburse all or a portion of the Escrowed Property, as applicable.

 

(iv)          “Person” means an individual, a partnership, a corporation, a limited liability company, an association, a joint stock company, a trust, a joint venture, an unincorporated organization or a Governmental Entity or any department, agency or political subdivision thereof.

 

6.                                      Escrow Agent.  The Escrow Agent undertakes to perform only such duties as are expressly set forth herein, which shall be deemed purely ministerial in nature, and no duties shall be implied.  The Escrow Agent shall neither be responsible for, nor chargeable with, knowledge of, nor have any requirements to comply with, the terms and conditions of any other agreement, instrument or document between the Parties, in connection herewith, if any, including without limitation the Investor Rights Agreement, nor shall the Escrow Agent be required to determine if any Person has complied with any such agreements, nor shall any additional obligations of the Escrow Agent be inferred from the terms of such agreements, even though reference thereto may be made in this Agreement.  The Escrow Agent may rely upon and shall not be liable for acting or refraining from acting upon any Joint Release Instruction furnished to it hereunder and believed by it to be genuine and to have been signed and presented by the proper Party or Parties, except in the event of Escrow Agent’s fraud, gross negligence or willful misconduct.  Concurrent with the execution of this Agreement, the Parties shall deliver to the Escrow Agent authorized signers’ forms in the form of Exhibit A-1 and Exhibit A-2 attached hereto.  The Escrow Agent shall be under no duty to inquire into or investigate the validity, accuracy or content of any such

 

3

 

document, notice, instruction or request.  The Escrow Agent shall have no duty to solicit any payments which may be due it or the Escrowed Property.  In the event that the Escrow Agent shall be uncertain as to its duties or rights hereunder or shall receive instructions, claims or demands from any Party hereto which, in its opinion, conflict with any of the provisions of this Agreement, it shall be entitled to refrain from taking any action and its sole obligation shall be to keep safely all property held in escrow until it shall be directed otherwise in a Final Determination.  The Escrow Agent may, after 10 days’ notice to the Parties of intention to do so, interplead all of the assets held hereunder into a court of competent jurisdiction or may seek a declaratory judgment with respect to certain circumstances, and thereafter be fully relieved from any and all liability or obligation with respect to such interpleaded assets or any action or nonaction based on such declaratory judgment.  The Escrow Agent may consult with legal counsel of its selection at its sole cost and expense in the event of any dispute or question as to the meaning or construction of any of the provisions hereof or its duties hereunder.  The Escrow Agent shall have no liability or obligation for any action taken in good faith with respect to the Escrowed Property except for the Escrow Agent’s fraud, willful misconduct or gross negligence.  To the extent practicable, the Parties agree to pursue any redress or recourse in connection with any dispute (other than with respect to a dispute involving the Escrow Agent) without making the Escrow Agent a party to the same.  Anything in this Agreement to the contrary notwithstanding, in no event shall the Escrow Agent be liable, directly or indirectly, 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 has been advised of the likelihood of such loss or damage and regardless of the form of action.

 

7.                                      Resignation and Removal of Escrow Agent.  The Escrow Agent (a) may resign and be discharged from its duties or obligations hereunder by giving thirty (30) calendar days advance notice in writing of such resignation to the Parties specifying a date when such resignation shall take effect or (b) may be removed, with or without cause, by Nantucket and Jaguar acting jointly at any time by providing written notice to the Escrow Agent.  Any corporation or association into which the Escrow Agent may be merged or converted or with which it may be consolidated, or any corporation or association to which all or substantially all of the escrow business of the Escrow Agent’s line of business may be transferred, shall be the Escrow Agent under this Agreement without further act.  The Escrow Agent’s sole responsibility after such thirty (30) day notice period expires (or such later date resignation is effective as specified in the notice) or after receipt of written notice of removal shall be to hold and safeguard the Escrowed Property (without any obligation to reinvest the same) and to deliver the same (i) to a substitute or successor escrow agent pursuant to a joint written designation from the Parties, (ii) as set forth in a Joint Release Instruction or (iii) in accordance with the directions of a Final Determination, at which time of delivery the Escrow Agent’s obligations hereunder shall cease and terminate.  In the event the Escrow Agent resigns, if the Parties have failed to appoint a successor escrow agent prior to the expiration of thirty (30) calendar days following receipt of the notice of resignation, the Escrow Agent may petition any court of competent jurisdiction for the appointment of such a successor escrow agent or for other appropriate relief, and any such resulting appointment shall be binding upon all of the Parties hereto.

 

8.                                      Fees and Expenses.  All fees and expenses of the Escrow Agent are described in Schedule 1 attached hereto and shall be paid by Jaguar. The fees agreed upon for the services to be rendered hereunder are intended as full compensation for the Escrow Agent services as 

 

4

 

contemplated by this Agreement; provided, however, that in the event that the conditions for the disbursement of Escrowed Shares under this Agreement are not fulfilled, or the Escrow Agent renders any service not contemplated in this Agreement, or there is any assignment of interest in the subject matter of this Agreement, or any material modification hereof, or any material modification hereof, or if any material controversy arises hereunder, or the Escrow Agent is made a party to any litigation pertaining to this Agreement or the subject matter hereof, then the Escrow Agent shall be compensated for such extraordinary services and reimbursed for all reasonable and documented out-of-pocket costs and expenses, including reasonable attorneys’ fees and expenses, occasioned by any such delay, controversy, litigation or event.

 

9.                                      Indemnity.  Each of the Parties shall jointly and severally indemnify, defend and save harmless the Escrow Agent and its affiliates and their respective successors, assigns, directors, officers, agents and employees (the “Indemnitees”) from and against any and all losses, damages, claims, liabilities, penalties, judgments, settlements, actions, suits, proceedings, litigation, investigations, costs or expenses (including the reasonable fees and expenses of one outside counsel and experts and their staffs and all expense of document location, duplication and shipment) (collectively “Escrow Agent Losses”) arising out of or in connection with (a) the Escrow Agent’s execution and performance of this Agreement, tax reporting or withholding, the enforcement of any rights or remedies under or in connection with this Agreement, or as may arise by reason of any act, omission or error of the Indemnitee, except to the extent that such Escrow Agent Losses have been caused by the fraud, gross negligence or willful misconduct of Escrow Agent or any such Indemnitee, or (b) its following any instructions or other directions from Jaguar or Nantucket, except to the extent that its following any such instruction or direction is expressly forbidden by the terms hereof.  The Parties hereto acknowledge that the foregoing indemnities shall survive the resignation or removal of the Escrow Agent or the termination of this Agreement.  Notwithstanding anything to the contrary herein, Nantucket and Jaguar agree, solely as between themselves, that any obligation for indemnification under this Section 9 (or for reasonable fees and expenses of the Escrow Agent described in Section 8) shall be borne by the party or parties determined by a court of competent jurisdiction to be responsible for causing the loss, damage, liability, cost or expense against which the Escrow Agent is entitled to indemnification or, if no such determination is made, then one-half by Nantucket and one-half by Jaguar.  The provisions of this Section 9 shall survive the resignation or removal of the Escrow Agent and the termination of this Agreement.

 

10.                               Tax Matters.

 

(a)           The Parties shall provide an executed IRS Form W-9 or appropriate IRS Form W-8 (or, in each case, any successor form) to the Escrow Agent prior to the date hereof, and shall promptly update any such form to the extent such form becomes obsolete or inaccurate in any respect.

 

(b)           Nantucket and Jaguar agree that, for federal and applicable state income tax purposes, Nantucket shall be treated as the owner of the Escrowed Shares and the income earned thereon, if any. The Escrow Agent shall report such income on IRS Form 1099 showing the Escrow Agent as payor and Nantucket as payee as of the end of each calendar year and to the extent required by the Code and the regulations promulgated thereunder, whether or not such income was disbursed during such calendar year. Neither Nantucket nor Jaguar shall take any 

 

5

 

position for federal or applicable state income tax purposes that is inconsistent with the provisions of this Section 10.

 

(c)           Nantucket and Jaguar acknowledge and agree that the Escrow Agent shall have no responsibility for the preparation and/or filing of any tax return or withholding with respect to the Escrowed Shares or any income earned by the Escrowed Shares.  The Escrow Agent shall withhold any taxes required to be withheld by applicable law, including but not limited to required withholding in the absence of proper tax documentation, and shall remit such taxes to the appropriate authorities.

 

11.                               Covenant of Escrow Agent.  The Escrow Agent hereby agrees and covenants with Nantucket and Jaguar that it shall perform all of its obligations under this Agreement and shall not deliver custody or possession of any of the Escrowed Property to anyone except pursuant to the express terms of this Agreement or as otherwise required by law.

 

12.                               Notices.  All notices, requests, demands and other communications required under this Agreement shall be in writing, in English, and shall be deemed to have been duly given if delivered (i) personally, (ii) by facsimile transmission with written confirmation of receipt, (iii) on the day of transmission if sent by electronic mail (“e-mail”) with a signed PDF attachment to the e-mail address given below, and written confirmation of receipt is obtained promptly after completion of the transmission, (iv) by overnight delivery with a reputable national overnight delivery service, or (v) by mail or by certified mail, return receipt requested, and postage prepaid. If any notice is mailed, it shall be deemed given five business days after the date such notice is deposited in the United States Mail. If notice is given to a party, it shall be given at the address for such party set forth below. It shall be the responsibility of the Parties to notify the Escrow Agent and the other Party in writing of any name or address changes.

 

if to Nantucket, then to:

 

Nantucket Investments Limited

Regency Court

Glategny Esplanade

St. Peter Port

Guernsey GY1 1WW

Attention:  Mark Woodall

Telephone No.:  +44 1481 723450

Facsimile No.:  +44 1481 716868

Email:

 

6

 

with a copy (which shall not constitute notice) to:

 

Klee, Tuchin, Bogdanoff & Stern LLP

1999 Avenue of the Stars

39th Floor

Los Angeles, CA 90067

Attention:  Lee Bogdanoff / Justin Yi

Telephone No.:  (310) 407-4000

Facsimile No.:  (310) 407-9090

Email:  lbogdanoff@ktbslaw.com / jyi@ktbslaw.com

 

or, if to Jaguar, then to:

 

Jaguar Animal Health, Inc.

201 Mission Street, Suite 2375

San Francisco, CA 94105

Telephone No.:  (415) 371-8300

Facsimile: (415) 371-8311

Attn: Lisa A. Conte, President and CEO

E-mail: lconte@jaguaranimalhealth.com

 

with a copy (which shall not constitute notice) to:

 

Reed Smith LLP

101 Second Street, Suite 1800

San Francisco, CA 94105

Telephone No.:  (415) 659-5989

Facsimile No.:  (415) 391-8269

Attn: Donald C Reinke, Esq.

E-mail: dreinke@reedsmith.com

 

or, if to the Escrow Agent, then to:

 

Citibank, N.A.

Citi Private Bank

One Sansome Street, 23rd Floor

San Francisco, CA 94105

Attn: Claude Acoba

Phone:  415- 627-6424

Fax:  415-592-5584

E-mail: Claude.Acoba@citi.com

 

Notwithstanding the above, in the case of communications delivered to the Escrow Agent pursuant to the foregoing clause (c) or (d) of this Section 12, such communications shall be 

 

7

 

deemed to have been given on the date received by the Escrow Agent.  In the event that the Escrow Agent, in its sole discretion, shall determine that an emergency exists, the Escrow Agent may use such other means of communication as the Escrow Agent deems appropriate.

 

13.                               Termination.  This Agreement shall terminate on the first to occur of (a) the delivery of all the Escrowed Property in accordance with this Agreement or (b) delivery to the Escrow Agent of a written notice of termination executed jointly by Nantucket and Jaguar after which this Agreement shall be of no further force and effect except that the provisions of Section 9 hereof shall survive termination.

 

14.                               Miscellaneous.  The provisions of this Agreement may be waived, altered, amended or supplemented, in whole or in part, only by a writing signed by all of the parties hereto.  Neither this Agreement nor any right or interest hereunder may be assigned in whole or in part by any party, except as provided in Section 7, without the prior consent of each other party hereto.  To comply with Federal law including USA Patriot Act requirements, any such permitted assignees shall provide to the Escrow Agent the appropriate form W-9 or W-8 as applicable and such other forms and documentation that the Escrow Agent may reasonably request to verify identification and authorization to act.  This Agreement shall be governed by and construed under the laws of the State of Delaware without giving effect to the principles of conflicts of law thereof or of any other jurisdiction. Each party irrevocably waives any objection on the grounds of venue, forum non-conveniens or any similar grounds and irrevocably consents to service of process by mail or in any other manner permitted by applicable law and consents to the jurisdiction of the courts located in the State of New York.  The parties hereby waive any right to a trial by jury with respect to any lawsuit or judicial proceeding arising or relating to this Agreement.  This Agreement may be executed in multiple counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.  All signatures of the parties to this Agreement may be transmitted by facsimile or electronic transmission in portable document format (.pdf), and such facsimile or .pdf will, for all purposes, be deemed to be the original signature of such party whose signature it reproduces, and will be binding upon such party.  If any provision of this Agreement is determined to be prohibited or unenforceable by reason of any applicable law of a jurisdiction, then such provision shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions thereof, and any such prohibition or unenforceability in such jurisdiction shall not invalidate or render unenforceable such provisions in any other jurisdiction.  The Parties represent, warrant and covenant that each document, notice, instruction or request provided by such Party to Escrow Agent shall comply with applicable laws and regulations.  Where, however, the conflicting provisions of any such applicable law may be waived, they are hereby irrevocably waived by the parties hereto to the fullest extent permitted by law, to the end that this Agreement shall be enforced as written.  Except as expressly provided in Sections 8 and 9, nothing in this Agreement, whether express or implied, shall be construed to give to any person or entity other than the Escrow Agent and the Parties any legal or equitable right, remedy, interest or claim under or in respect of this Agreement or any property escrowed hereunder. As between the Parties, nothing in this Agreement waives or modifies any right or obligation under the Investor Rights Agreement.

 

15.                               Compliance with Court Orders.  In the event that any Escrowed Property shall be attached, garnished or levied upon by any court order, or the delivery thereof shall be stayed or

 

8

 

enjoined by an order of a court, or any order, judgment or decree shall be made or entered by any court order affecting the property deposited under this Agreement, the Escrow Agent is hereby expressly authorized, in its sole discretion, to obey and comply with all writs, orders or decrees so entered or issued, which it is advised by legal counsel of its own choosing is binding upon it, whether with or without jurisdiction, and in the event that the Escrow Agent obeys or complies with any such writ, order or decree it shall not be liable to any of the Parties hereto or to any other Person, by reason of such compliance notwithstanding such writ, order or decree be subsequently reversed, modified, annulled, set aside or vacated.  The Escrow Agent shall be required to notify Nantucket and Jaguar of any action taken with respect to the property deposited under this Agreement in order to comply with a writ, order or decree as described above.

 

16.          Further Assurances.  Following the date hereof, each party shall deliver to the other parties such further information and documents and shall execute and deliver to the other parties such further instruments and agreements as any other party shall reasonably request to consummate or confirm the transactions provided for herein, to accomplish the purpose hereof or to assure to any other party the benefits hereof.

 

17.          Reserved.

 

18.          Force Majeure.  The Escrow Agent shall not incur any liability for not performing any act or fulfilling any obligation hereunder by reason of any occurrence beyond its control (including, but not limited to, any provision of any present or future law or regulation or any act of any governmental authority, any act of God or war or terrorism, or the unavailability of the Federal Reserve Bank wire services or any electronic communication facility), it being understood that the Escrow Agent shall use commercially reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as reasonably practicable under the circumstances.

 

19.          Use of Citibank Name.  No publicly distributed printed or other material in any language, including prospectuses, notices, reports, and promotional material which mentions “Citibank” by name or the rights, powers, or duties of the Escrow Agent under this Agreement shall be issued by any other parties hereto, or on such party’s behalf, without the prior written consent of the Escrow Agent.

 

*    *    *    *    *

 

9

 

IN WITNESS WHEREOF, the parties hereto have executed this Escrow Agreement as of the date set forth above.

 

	
 
    	
NANTUCKET   INVESTMENTS LIMITED
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Its:
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
JAGUAR   ANIMAL HEALTH, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Its:
    	
 
    
	
 
    	
 
    
	
 
    	
ESCROW AGENT:
    
	
 
    	
 
    
	
 
    	
CITIBANK, N.A.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Its:
    	
 
    

 

Signature Page to Escrow Agreement

 

 

Schedule 1

 

ESCROW AGENT FEE SCHEDULE

Citibank, N.A., Escrow Agent

 

Acceptance Fee

 

To cover the acceptance of the Escrow Agency appointment, the study of the Escrow Agreement, and supporting documents submitted in connection with the execution and delivery thereof, and communication with other members of the working group:

 

Fee:

 

Administration Fee

 

The annual administration fee covers maintenance of the Escrow Account including safekeeping of assets in the escrow account, normal administrative functions of the Escrow Agent, including maintenance of the Escrow Agent’s records, follow-up of the Escrow Agreement’s provisions, and any other safekeeping duties required by the Escrow Agent under the terms of the Escrow Agreement. Fee is based on Escrow Amount being deposited in a non-interest bearing transaction deposit account, FDIC insured to the applicable limits.

 

Fee:

 

Tax Preparation Fee

 

To cover preparation and mailing of Forms 1099-INT, if applicable for the escrow parties for each calendar year:

 

Fee:

 

Transaction Fees

 

To oversee all required disbursements or release of property from the escrow account to any escrow party, including cash disbursements made via check and/or wire transfer, fees associated with postage and overnight delivery charges incurred by the Escrow Agent as required under the terms and conditions of the Escrow Agreement:

 

Fee:

 

Other Fees

 

Material amendments to the Agreement: additional fee(s), if any, to be discussed at time of amendment

 

TERMS AND CONDITIONS: The above schedule of fees does not include charges for reasonable out-of-pocket expenses or for any services of an extraordinary nature that we or our legal counsel may be called upon from time to time to perform in either an agency or fiduciary capacity.  Our participation in the transactions contemplated by the Agreement is subject to internal approval of the third party depositing monies into the escrow account.

 

 

EXHIBIT A-1

 

Certificate as to Jaguar’s Authorized Signatures

 

The specimen signatures shown below are the specimen signatures of the individuals who have been designated as authorized representatives of Jaguar and are authorized to initiate and approve transactions of all types for the escrow account or accounts established under this Agreement, on behalf of Jaguar.  The below listed persons (must list at least two individuals) have also been designated Call Back Authorized Individuals and will be notified by Citibank N.A. upon the release of Escrowed Property from the escrow account(s) unless an original “Standing or Predefined Instruction” letter is on file with the Escrow Agent.

 

	
Name / Title /Telephone #
    	
 
    	
Specimen Signature
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Lisa A. Conte
    	
 
    	
 
    
	
Name
    	
 
    	
Signature
    
	
 
    	
 
    	
 
    
	
CEO and President
    	
 
    	
 
    
	
Title
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
(415) 371-8300
    	
 
    	
 
    
	
Telephone #
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Karen S. Wright
    	
 
    	
 
    
	
Name
    	
 
    	
Signature
    
	
 
    	
 
    	
 
    
	
CFO
    	
 
    	
 
    
	
Title
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
(415) 503-7483
    	
 
    	
 
    
	
Telephone #
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Name
    	
 
    	
Signature
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Title
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Telephone #
    	
 
    	
 
    

 

Exhibit to Escrow Agreement

 

 

EXHIBIT A-2

 

Certificate as to Nantucket Authorized Signatures

 

The specimen signatures shown below are the specimen signatures of the individuals who have been designated as authorized representatives of Nantucket and are authorized to initiate and approve transactions of all types for the escrow account or accounts established under this Agreement, on behalf of Nantucket.  The below listed persons (must list at least two individuals) have also been designated Call Back Authorized Individuals and will be notified by Citibank N.A. upon the release of Escrowed Property from the escrow account(s) unless an original “Standing or Predefined Instruction” letter is on file with the Escrow Agent.

 

	
Name / Title /Telephone #
    	
 
    	
Specimen Signature
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Name
    	
 
    	
Signature
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Title
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Telephone #
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Name
    	
 
    	
Signature
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Title
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Telephone #
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Name
    	
 
    	
Signature
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Title
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Telephone #
    	
 
    	
 
    

 

Exhibit to Escrow Agreement

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00269-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00269-of-00352.parquet"}]]