Document:

Exhibit 10.15

 

This
Agreement is made on 30 November 2006, between:

 

1.                                       Warburg Pincus Partners LLC (acting in its capacity as general partner
of Warburg Pincus Equity Partners, L.P., Warburg Pincus Netherlands Equity
Partners I C.V. and Warburg Pincus Netherlands Equity Partners III C.V.),
having its registered address at 466 Lexington Avenue, New York, NY 10017, USA
(“WPP”);

 

2.                                       Warburg Pincus Ventures
International, L.P., having
its registered address at Cedar House, 41 Cedar Avenue, Hamilton HMI2, Bermuda
(“WPVI”, and together with WPP, “WP”); and

 

3.                                       Eurand B.V., a private limited liability company
incorporated under the laws of The Netherlands, whose corporate seat is at
Olympic Plaza, Fred. Roeskestraat 123, 1076 EE Amsterdam, The Netherlands (“Eurand”).

 

WHEREAS:

 

A.                                   With a view to the intended initial public
offering (“IPO”) of its ordinary shares on
the NASDAQ Global Market, Eurand wishes to convert from a BV-company into a
Netherlands NV-company (naamloze vennootschap);

 

B.                                     In order to be able to convert into an
NV-company, section 2:72 paragraph 1 under b. of the Netherlands Civil Code
requires, among others, that an accountant renders a certificate (the “Certificate”) showing that on a date within five months
prior to the date of conversion, the net assets of Eurand in accounts under
Dutch GAAP were at least equal to its paid up and called up part of the capital
according to the deed of conversion;

 

C.                                     In order to enable the accountant to render
the Certificate, it is proposed that each of WPVI and WPP will convert €11.5
million of principal amount of certain loans granted to Eurand on 6 August
2003, as modified on 20 December 2003, into equity, so that in total €23
million of principal amount of those certain loans will be converted into
equity (such total principal amount, excluding the accrued and unpaid
accumulated interest thereon, hereafter the “Loan”);

 

D.                                    Each of WPVI and WPP is willing to convert
the Loan into equity on the terms and conditions set forth in this Agreement.

 

NOW
HEREBY AGREE AS FOLLOWS:

 

Article 1                                               Amendment
of the Articles of Association of Eurand

 

The
parties agree to procure that the Articles of Association of Eurand will be
amended on or before 30 November 2006 in all material respects in accordance
with the draft deed of amendment attached hereto as Schedule 1
(such Articles of Association after the amendment hereafter referred to as the “Amended Articles”).

 

Article 2                                               Issue
of two C shares

 

Immediately
after the amendment of the Articles of Association, but in any event on or
before 30 November 2006, Eurand shall issue one C share, as defined in the
Amended Articles, to each of WPVI and

 

 

WPP.
Each of WPVI and WPP shall pay up the C shares by converting the Loan into
equity. The difference between the value of the Loan at the date of issue of
the two C shares and the nominal value of the C shares will be treated as share
premium and will be allocated to the C share premium reserve (as defined in the
Amended Articles). The C shares will have the characteristics as described in
the Amended Articles, which characteristics will remain unchanged in subsequent
amendments of the Amended Articles as long as there is a balance in the C share
premium reserve.

 

Article 3                                               Conversion into an NV-company

 

Eurand
shall use its best efforts to procure that as soon as is reasonably possible
after the issue of the two C shares, an accountant will render the Certificate.
As soon as possible after the Certificate has been rendered and a statement of
no-objection (verklaring van geen bezvaar) has
been obtained from the Netherlands Ministry of Justice with respect to the
conversion and the amendment of the Articles of Association of Eurand, Eurand
will be converted into an NV-company. Upon conversion into an NV-company the
Articles of Association of Eurand will in all material respects be in
accordance with the draft deed of conversion and amendment attached hereto as Schedule
2.

 

Article 4                                               Issue of shares against C share premium reserve
after IPO and conversion of the C shares into B shares

 

4.1.                              If the IPO takes place
before 30 June 2007, or at any time thereafter an IPO takes place and the C
shares are still outstanding, at the date thereof WP shall request the
management board of Eurand, and the management board of Eurand shall be obliged
to resolve (i) to convert the C share premium reserve immediately after
settlement of the IPO into ordinary B shares to be issued by Eurand to each of
WPVI and WPP, and (ii) immediately after such issue of B shares, to convert
each of the C shares into one B share. Upon receipt of such request the
management board shall immediately resolve (a) to issue such number of B shares
in its capital as is equal to the sum of (i) the balance of the C share premium
reserve, (ii) any dividend which was not paid to the holders of the C shares in
a prior year in accordance with article 23 of the Amended Articles and (iii) an
amount equal to that part of the dividend payment that would have been due for
the current financial year to the holders of the C shares, calculated according
to the number of days from the beginning of the financial year up to and
including the dale of issue of the B shares, minus any dividend paid on the C
shares in the current financial year, divided by the price for a B share in the
IPO (converted into euros based at the euro/dollar exchange rate for buying a
currency quoted by JP Morgan Chase Bank in London at or about 11.00 a.m.
(London time) on the date of the IPO), whereby fractions will be rounded down
to the nearest whole number, and (b) upon issue of the B shares to convert each
of the C shares into one B share. In addition the management board shall
resolve that (x) the B shares to be issued to WP in accordance with the
previous sentence will be issued with the exclusion of pre-emptive rights of
other shareholders and (y) such B shares will be paid up out of the entire
balance of the C share premium reserve, whereby the difference between such
balance and the nominal value of the B shares to be issued will be deemed to be
a premium reserve allocated to the B shares.

 

4.2.                              As soon as is reasonably possible after the above management board
resolution has been adopted, Eurand shall take all necessary steps to
effectuate the issue of the B shares and subsequently the conversion of each of
the C shares into one B share.

 

Article 5                                               Issue
of shares against C share premium account and conversion of the C share into a
B share if no IPO takes place

 

5.1.                              At any time after 30 June 2007, if no IPO has taken place, WP may
request the management board of Eurand, and the management board of Eurand
shall be obliged to resolve, to convert the C share 

 

2

 

premium reserve
into ordinary B shares to be issued by Eurand to WP. If such a request is made,
WP and Eurand will (i) firstly jointly seek to agree a valuation of the
ordinary B shares, or (ii) if no agreement can be reached between Eurand and WP
within 20 business days from the date of the request from WP, Eurand and WP
will then jointly request an independent accountancy firm or investment bank
with an international reputation to determine, as independent expert, the value
per outstanding ordinary B share in euros on a fully diluted basis. In the
absence of agreement between Eurand and WP on such independent expert within 10
business days, each party shall be entitled to request the chairman of the
Chamber of Commerce (Kamer van Koophandel)
at Amsterdam to appoint such independent expert. The valuation by the
independent expert (the “First Expert Valuation”)
will be binding on Eurand, but WP may request a second valuation within one
month from the date of the First Expert Valuation. In the event that WP
requests a second valuation, Eurand and WP shall agree on an independent
accountancy firm or investment bank with international reputation to determine,
as second independent expert, the value per outstanding ordinary B share in
euros on a fully diluted basis. In the absence of agreement between Eurand and
WP on such independent expert within 10 business days, each party shall be
entitled to request the chairman of the Chamber of Commerce at Amsterdam to
appoint such independent expert. The valuation by the second independent expert
(the “Second Expert Valuation”) shall be
binding on all parties and shall supersede the First Expert Valuation. Once the
value of the ordinary B Shares is determined in accordance with the above, WP
can then elect, within one month from the later of the date of the First Expert
Valuation or the Second Expert Valuation (to the extent it has been prepared),
to either a) convert the C share premium into ordinary B shares, or b) choose
not convert the C share premium. If WP chooses not to convert the C share
premium, then WP must wait for at least six months before sending a new request
to the management board of Eurand to convert the C share premium reserve into
ordinary B shares. The procedure to come to a valuation per outstanding
ordinary B share in euros on a fully diluted basis with respect to a new
request will be the same as described above. If WP chooses to convert the C
share premium on the basis of the valuation agreed or determined, the
management board will resolve (a) to issue such number of B shares in its
capital as is equal to the sum of (i) the balance of the C share premium
reserve, (ii) any dividend which was not paid to the holders of the C shares in
a prior year in accordance with article 23 of the Amended Articles and (iii) an
amount equal to that part of the dividend payment that would have been due for
the current financial year to the holders of the C shares, calculated according
to the number of days from the beginning of the financial year up to and
including the date of issue of the B shares, minus any dividend paid on the C
shares in the current financial year, divided by the value per B share as
agreed or determined by the process described above, whereby fractions will be
rounded down to the nearest whole number, and (b) upon issue of the B shares to
convert each of the C shares into one B share. In addition the management board
shall resolve that (x) the B shares to be issued to WP in accordance with the
previous sentence will be issued with exclusion of pre-emptive rights of other
shareholders and (y) such B shares will be paid up out of the entire balance of
the C share premium reserve, whereby the difference between such balance and
the nominal value of the B shares to be issued will be deemed to be a premium
reserve allocated to the B shares. If and to the extent at the time of the
issue of the B shares Eurand has insufficient freely distributable reserves to
pay up the nominal amount of the B shares to be issued, such nominal amount
will be paid up by WP in cash.

 

5.2.                              The costs of the First Expert Valuation will be borne by Eurand and the
costs of the Second Expert Valuation will be borne by WP.

 

5.3.                              As soon as is reasonably possible after the management board resolution
referred to in article 5.1 has been adopted, Eurand shall take all necessary
steps to effectuate the issue of the B shares and subsequently the conversion
of each of the C shares into one B share.

 

3

 

Article 6                                               Repayment
of share premium and conversion into loan if no IPO takes place

 

If
no IPO takes place by 30 June 2007, at any time thereafter WP may request from
Eurand repayment of (part of) the balance of the C share premium reserve if and
to the extent Eurand has freely distributable reserves. If (part of) the
balance of the C share premium reserve thus becomes repayable, such (part of)
the balance will be converted into a loan note subject to similar terms and
conditions as the Loan following required procedures under applicable tax and
legal rules.

 

Article 7                                               Sale
of Eurand

 

If
the shares (or part thereof including the C shares) of Eurand are sold in a
private sale, the purchase price for the equity will be allocated as follows. First
of all such part of the purchase price as corresponds with the sum of (i) the
balance of the C share premium reserve, (ii) any dividend which was not paid to
the holders of the C shares in a prior year in accordance with article 23 of
the Amended Articles and (iii) an amount equal to that part of the dividend
payment that would have been due for the current financial year to the holders
of the C shares, calculated according to the number of days from the beginning
of the financial year up to and including the date of sale of Eurand, minus any
dividend paid on the C shares in the current financial year, will be paid to
the holder of the C shares. The remainder of the purchase price will be paid to
the selling shareholders pro rata to the number of shares sold by each of them.

 

Article 8                                               Approval
general meeting of shareholders

 

The
parties agree to submit this agreement for approval to the general meeting of
shareholders of Eurand to be held on 29 November 2006.

 

Article 9                                               Termination
of Agreement

 

This
Agreement will come into force immediately and will remain in force, provided
the C shares have been issued, as long as there is a balance in the C share
premium reserve. It will terminate automatically as soon as, after the C shares
have been issued, there is no longer any balance in the C share premium
reserve.

 

Article 10                                        Assignment

 

Eurand
may not assign this agreement (contractsoverneming)
or assign any of its rights thereunder without the prior written consent of WP.
Each of WPP and WPVI may assign this agreement or assign any of their rights
thereunder to one of their affiliates, provided that such assignment shall
require notification to Eurand.

 

Article 11                                        Governing
Law

 

This
Agreement shall be governed by and construed in accordance with the laws of the
Netherlands.

 

Article 12                                        Counterparts

 

This
Agreement may be executed in any number of counterparts, all of which, taken
together constitute one agreement and any party may enter into this agreement
by executing a counterpart.

 

4

 

	
   

  	
  This Agreement has been signed on 30 November 2006.

  	
   

  	
   

  	 

	
   

  	
   

  	
   

  	
   

  	 

	
   

  	
  WARBURG PINCUS PARTNERS, LLC

  	
   

  	
   

  	 

	
   

  	
   

  	
   

  	
   

  	 

	
   

  	
  By: Warburg Pincus & Co., Managing Member

  	
   

  	
   

  	 

	
   

  	
   

  	
   

  	
   

  	 

	
  By: 

  	
  /s/ Timothy J. Curt

  	
   

  	
   

  	 

	
   

  	
  Name: Timothy J. Curt

  	
   

  	
   

  
	
   

  	
  Partner

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  WARBURG PINCUS VENTURES INTERNATIONAL, L.P.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By: Warburg Pincus Partners LLC, General Partner

  	
   

  	
   

  
	
   

  	
  By: Warburg Pincus & Co., Managing Member

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By: 

  	
  /s/ Timothy J. Curt

  	
   

  	
   

  
	
   

  	
  Name: Timothy J. Curt

  	
   

  	
   

  
	
   

  	
  Partner

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  EURAND B.V.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title

  	
   

  	
   

  
							

 

5

 

	
   

  	
  This Agreement has been signed on 30
  November 2006.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  WARBURG PINCUS PARTNERS, LLC

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By: Warburg Pincus & Co., Managing Member

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Partner

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  WARBURG PINCUS VENTURES INTERNATIONAL, L.P.

  	
   

  	 

	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By: Warburg Pincus Partners LLC, General Partner

  	
   

  	
   

  
	
   

  	
  By: Warburg Pincus & Co., Managing Member

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Partner

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  EURAND B.V.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Gearoid Faherty

  	
   

  	
   

  
	
   

  	
  Name: Gearoid Faherty

  	
   

  	
   

  
	
   

  	
  Title: Managing Director

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Nicholas Lowcock

  	
   

  	
   

  
	
   

  	
  Name: Nicholas Lowcock

  	
   

  	
   

  
	
   

  	
  Title: Managing Director

  	
   

  	
   

  

 

6Exhibit 10.16

 

This agreement is made on • 2007,
between:

 

1.                                       Warburg Pincus Partners LLC (acting in its capacity as general partner
of Warburg Pincus Equity Partners, L.P., Warburg Pincus Netherlands Equity
Partners I C.V. and Warburg Pincus Netherlands Equity Partners III C.V.),
having its registered address at 466 Lexington Avenue, New York, NY 10017, USA
(“WPP”);

 

2.                                       Warburg Pincus Ventures
International, L.P., having
its registered address at Cedar House, 41 Cedar Avenue, Hamilton HM12, Bermuda
(“WPVI”, and together with WPP, “WP”); and

 

3.                                       Eurand N.V. (formerly named
Eurand B.V.), a public
limited liability company incorporated under the laws of The Netherlands, whose
corporate seat is at Olympic Plaza, Fred. Roeskestraat 123, 1076 EE Amsterdam,
The Netherlands (“Eurand”).

 

WHEREAS:

 

A.                                   The
parties entered into an agreement on 30 November 2006 (the “Agreement”);

 

B.                                     The
parties wish to amend the Agreement as set forth hereafter;

 

C.                                     Unless
otherwise defined in this amendment the terms defined in the Agreement shall
have the same meaning when used in this amendment;

 

NOW HEREBY AGREE AS FOLLOWS:

 

1.             To amend article 4.1
of the Agreement as follows:

 

If the determination of the price of each of
the ordinary shares to be offered in the IPO (the “IPO Ordinary
Share Price”) takes place before 30 June 2007, or at any time
thereafter pricing of the ordinary shares to be offered in an IPO takes place
and the C shares are still outstanding, WP shall request the management board
of Eurand on or before the date of determination of the IPO Ordinary Share
Price (the “Pricing Date”), and the management
board of Eurand shall be obliged to resolve (i) to convert the C share premium
reserve immediately after determination of the IPO Ordinary Share Price into
ordinary shares to be issued by Eurand to each of WPVI and WPP, and (ii)
immediately after such issue of ordinary shares to each of WPVI and WPP, to
convert each of the C shares into one ordinary share. Upon receipt of such
request the management board shall resolve (a) immediately after determination
of the IPO Ordinary Share Price to issue such number of ordinary shares in its
capital as is equal to the sum of (i) the balance of the C share premium
reserve, (ii) any dividend which was not paid to the holders of the C shares in
a prior year in accordance with article 23 of the Amended Articles and (iii) an
amount equal to that part of the dividend payment that would have been due for
the current financial year to the holders of the C shares, calculated according
to the number of days from the beginning of the financial year up to and
including the date of issue of the ordinary shares to each of WPVI and WPP
under this article, minus any dividend paid on the C shares in the current
financial year, divided by the IPO Ordinary Share Price (converted into euros
(if the IPO Ordinary Share Price is not denominated in euros) based at the
euro/dollar exchange rate for buying a currency quoted by JP Morgan Chase Bank
in London at or about 11.00 a.m. (London time) on the Pricing Date),

 

 

whereby fractions will be rounded down to the
nearest whole number, and (b) upon issue of the ordinary shares to convert each
of the C shares into one ordinary share. In addition the management board shall
resolve that (x) the ordinary shares to be issued to WP in accordance with the
previous sentence will be issued with the exclusion of pre-emptive rights of
other shareholders and (y) such ordinary shares will be paid up out of the
entire balance of the C share premium reserve, whereby the difference between
such balance and the nominal value of the ordinary shares to be issued will be
deemed to be a premium reserve allocated to the ordinary shares.

 

2.                                      Wherever
the Agreement refers to “(ordinary) B shares” or “(ordinary) B share”, to amend
this in “ordinary shares” or “ordinary share”.

 

3.                                      Articles
11 and 12 of the Agreement apply mutatis mutandis to this agreement.

 

4.             The Agreement as
amended and restated is attached as Annex A.

 

This agreement has been signed on • 2007

 

 

	
   

  	
   

  
	
  Warburg, Pincus Partners LLC

  
	
  by: Warburg Pincus & Co, its Managing
  Member

  
	
   

  	
  by:

  
	
   

  	
  title:

  
			

 

 

	
   

  	
   

  
	
  Warburg, Pincus Ventures
  International, L.P.

  
	
  by: Warburg, Pincus Partners LLC, its General
  Partner

  
	
   

  	
  by: Warburg Pincus
  & Co, its Managing Member

  
	
   

  	
  by:

  
	
   

  	
  title:

  
				

 

 

	
   

  	
   

  
	
  Eurand N.V.

  
	
  by:

  
	
  title:

  

 

2

 

ANNEX A

 

The Conversion Agreement
dated 30 November 2006 as amended and restated on • 2007

(without Schedules)

 

This Agreement is made on 30 November 2006 and
amended on • 2007, between:

 

1.                                       Warburg Pincus Partners LLC (acting in its capacity as general partner
of Warburg Pincus Equity Partners, L.P., Warburg Pincus Netherlands Equity Partners
I C.V. and Warburg Pincus Netherlands Equity Partners III C.V.), having its
registered address at 466 Lexington Avenue, New York, NY 10017, USA (“WPP”);

 

2.                                       Warburg Pincus Ventures
International, L.P., having
its registered address at Cedar House, 41 Cedar Avenue, Hamilton HM12, Bermuda
(“WPVI”, and together with WPP, “WP”); and

 

3.                                       Eurand N.V. (formerly named
Eurand B.V.), a private
limited liability company incorporated under the laws of The Netherlands, whose
corporate seat is at Olympic Plaza, Fred. Roeskestraat 123, 1076 EE Amsterdam,
The Netherlands (“Eurand”).

 

WHEREAS:

 

A.                                   With a
view to the intended initial public offering (“IPO”)
of its ordinary shares on the NASDAQ Global Market, Eurand wishes to convert
from a BV-company into a Netherlands NV-company (naamloze
vennootschap);

 

B.                                     In order
to be able to convert into an NV-company, section 2:72 paragraph 1 under b. of
the Netherlands Civil Code requires, among others, that an accountant renders a
certificate (the “Certificate”)
showing that on a date within five months prior to the date of conversion, the
net assets of Eurand in accounts under Dutch GAAP were at least equal to its
paid up and called up part of the capital according to the deed of conversion;

 

C.                                     In order
to enable the accountant to render the Certificate, it is proposed that each of
WPVI and WPP will convert €11.5 million of principal amount of certain loans
granted to Eurand on 6 August 2003, as modified on 20 December 2003, into
equity, so that in total €23 million of principal amount of those certain loans
will be converted into equity (such total principal amount, excluding the
accrued and unpaid accumulated interest thereon, hereafter the “Loan”);

 

D.                                    Each of
WPVI and WPP is willing to convert the Loan into equity on the terms and
conditions set forth in this Agreement.

 

NOW HEREBY AGREE AS FOLLOWS:

 

Article 1                 Amendment of the Articles of
Association of Eurand

 

The parties agree to procure that the Articles
of Association of Eurand will be amended on or before 30 November 2006 in all
material respects in accordance with the draft deed of amendment attached
hereto as Schedule 1 (such Articles of Association after the amendment
hereafter referred to as the “Amended Articles”).

 

3

 

Article 2                 Issue of two C shares

 

Immediately after the amendment of the Articles
of Association, but in any event on or before 30 November 2006, Eurand shall
issue one C share, as defined in the Amended Articles, to each of WPVI and WPP.
Each of WPVI and WPP shall pay up the C shares by converting the Loan into
equity. The difference between the value of the Loan at the date of issue of
the two C shares and the nominal value of the C shares will be treated as share
premium and will be allocated to the C share premium reserve (as defined in the
Amended Articles). The C shares will have the characteristics as described in
the Amended Articles, which characteristics will remain unchanged in subsequent
amendments of the Amended Articles as long as there is a balance in the C share
premium reserve.

 

Article 3                 Conversion
into an NV-company

 

Eurand shall use its best efforts to procure
that as soon as is reasonably possible after the issue of the two C shares, an
accountant will render the Certificate. As soon as possible after the Certificate
has been rendered and a statement of no-objection (verklaring
van geen bezwaar) has been obtained from the Netherlands Ministry of
Justice with respect to the conversion and the amendment of the Articles of
Association of Eurand, Eurand will be converted into an NV-company. Upon
conversion into an NV-company the Articles of Association of Eurand will in all
material respects be in accordance with the draft deed of conversion and
amendment attached hereto as Schedule 2.

 

Article
4                                                 Issue of
shares against C share premium reserve after IPO and conversion of the C shares
into B shares

 

4.1                                If the
determination of the price of each of the ordinary shares to be offered in the
IPO (the “IPO Ordinary Share Price”) takes place
before 30 June 2007, or at any time thereafter pricing of the ordinary shares
to be offered in an IPO takes place and the C shares are still outstanding, WP
shall request the management board of Eurand on or before the date of
determination of the IPO Ordinary Share Price (the “Pricing Date”),
and the management board of Eurand shall be obliged to resolve (i) to convert
the C share premium reserve immediately after determination of the IPO Ordinary
Share Price into ordinary shares to be issued by Eurand to each of WPVI and
WPP, and (ii) immediately after such issue of ordinary shares to each of WPVI
and WPP, to convert each of the C shares into one ordinary share. Upon receipt
of such request the management board shall resolve (a) immediately after
determination of the IPO Ordinary Share Price to issue such number of ordinary
shares in its capital as is equal to the sum of (i) the balance of the C share
premium reserve, (ii) any dividend which was not paid to the holders of the C
shares in a prior year in accordance with article 23 of the Amended Articles
and (iii) an amount equal to that part of the dividend payment that would have
been due for the current financial year to the holders of the C shares,
calculated according to the number of days from the beginning of the financial
year up to and including the date of issue of the ordinary shares to each of
WPVI and WPP under this article, minus any dividend paid on the C shares in the
current financial year, divided by the IPO Ordinary Share Price (converted into
euros (if the IPO Ordinary Share Price is not denominated in euros) based at
the euro/dollar exchange rate for buying a currency quoted by JP Morgan Chase
Bank in London at or about 11.00 a.m. (London time) on the Pricing Date),
whereby fractions will be rounded down to the nearest whole number, and (b)
upon issue of the ordinary shares to convert each of the C shares into one
ordinary share. In addition the management board shall resolve that (x) the
ordinary shares to be issued to WP in accordance with the previous sentence
will be issued with the exclusion of pre-emptive rights of other shareholders
and (y) such ordinary shares will be paid up out of the entire balance of the C
share premium reserve, whereby the difference between such balance and the
nominal value of the ordinary shares to be issued will be deemed to be a
premium reserve allocated to the ordinary shares.

 

4

 

4.2                                As soon as
is reasonably possible after the above management board resolution has been
adopted, Eurand shall take all necessary steps to effectuate the issue of the
ordinary shares and subsequently the conversion of each of the C shares into
ordinary share.

 

Article
5                                                 Issue of
shares against C share premium account and conversion of the C share into a B
share if no IPO takes place

 

5.1                                At any
time after 30 June 2007, if no IPO has taken place, WP may request the
management board of Eurand, and the management board of Eurand shall be obliged
to resolve, to convert the C share premium reserve into ordinary shares to be
issued by Eurand to WP. If such a request is made, WP and Eurand will (i)
firstly jointly seek to agree a valuation of the ordinary shares, or (ii) if no
agreement can be reached between Eurand and WP within 20 business days from the
date of the request from WP, Eurand and WP will then jointly request an
independent accountancy firm or investment bank with an international
reputation to determine, as independent expert, the value per outstanding
ordinary share in euros on a fully diluted basis. In the absence of agreement
between Eurand and WP on such independent expert within 10 business days, each
party shall be entitled to request the chairman of the Chamber of Commerce (Kamer van Koophandel) at Amsterdam to appoint such
independent expert. The valuation by the independent expert (the “First Expert Valuation”) will be binding on Eurand, but WP
may request a second valuation within one month from the date of the First
Expert Valuation. In the event that WP requests a second valuation, Eurand and
WP shall agree on an independent accountancy firm or investment bank with
international reputation to determine, as second independent expert, the value
per outstanding ordinary share in euros on a fully diluted basis. In the
absence of agreement between Eurand and WP on such independent expert within 10
business days, each party shall be entitled to request the chairman of the
Chamber of Commerce at Amsterdam to appoint such independent expert. The
valuation by the second independent expert (the “Second
Expert Valuation”) shall be binding on all parties and shall
supersede the First Expert Valuation. Once the value of the ordinary shares is
determined in accordance with the above, WP can then elect, within one month
from the later of the date of the First Expert Valuation or the Second Expert
Valuation (to the extent it has been prepared), to either a) convert the C
share premium into ordinary shares, or b) choose not convert the C share
premium. If WP chooses not to convert the C share premium, then WP must wait for
at least six months before sending a new request to the management board of
Eurand to convert the C share premium reserve into ordinary shares. The
procedure to come to a valuation per outstanding ordinary share in euros on a
fully diluted basis with respect to a new request will be the same as described
above. If WP chooses to convert the C share premium on the basis of the
valuation agreed or determined, the management board will resolve (a) to issue
such number of ordinary shares in its capital as is equal to the sum of (i) the
balance of the C share premium reserve, (ii) any dividend which was not paid to
the holders of the C shares in a prior year in accordance with article 23 of
the Amended Articles and (iii) an amount equal to that part of the dividend
payment that would have been due for the current financial year to the holders
of the C shares, calculated according to the number of days from the beginning
of the financial year up to and including the date of issue of the ordinary
shares, minus any dividend paid on the C shares in the current financial year,
divided by the value per ordinary share as agreed or determined by the process
described above, whereby fractions will be rounded down to the nearest whole
number, and (b) upon issue of the ordinary shares to convert each of the C
shares into one ordinary share. In addition the management board shall resolve
that (x) the ordinary shares to be issued to WP in accordance with the previous
sentence will be issued with exclusion of pre-emptive rights of other
shareholders and (y) such ordinary shares will be paid up out of the entire
balance of the C share premium reserve, whereby the difference between such
balance and the nominal value of the ordinary shares to be issued will be
deemed to be a premium reserve allocated to the ordinary shares. If and to the
extent at the time of the issue of the ordinary shares Eurand has insufficient
freely distributable reserves to pay up the nominal amount of the ordinary
shares to be issued, such nominal amount will be paid up by WP in cash.

 

5

 

5.2                                The costs
of the First Expert Valuation will be borne by Eurand and the costs of the
Second Expert Valuation will be borne by WP.

 

5.3                                As soon as
is reasonably possible after the management board resolution referred to in
article 5.1 has been adopted, Eurand shall take all necessary steps to
effectuate the issue of the ordinary shares and subsequently the conversion of
each of the C shares into one ordinary share.

 

Article 6                 Repayment of share premium
and conversion into loan if no IPO takes place

 

If no IPO takes place by 30 June 2007, at any
time thereafter WP may request from Eurand repayment of (part of) the balance
of the C share premium reserve if and to the extent Eurand has freely
distributable reserves. If (part of) the balance of the C share premium reserve
thus becomes repayable, such (part of) the balance will be converted into a
loan note subject to similar terms and conditions as the Loan following
required procedures under applicable tax and legal rules.

 

Article 7                 Sale of Eurand  

 

If the shares (or part thereof including the C
shares) of Eurand are sold in a private sale, the purchase price for the equity
will be allocated as follows. First of all such part of the purchase price as
corresponds with the sum of (i) the balance of the C share premium reserve,
(ii) any dividend which was not paid to the holders of the C shares in a prior
year in accordance with article 23 of the Amended Articles and (iii) an amount
equal to that part of the dividend payment that would have been due for the
current financial year to the holders of the C shares, calculated according to
the number of days from the beginning of the financial year up to and including
the date of sale of Eurand, minus any dividend paid on the C shares in the
current financial year, will be paid to the holder of the C shares. The
remainder of the purchase price will be paid to the selling shareholders pro
rata to the number of shares sold by each of them.

 

Article 8                 Approval general meeting of
shareholders

 

The parties agree to submit this agreement for
approval to the general meeting of shareholders of Eurand to be held on 29
November 2006.

 

Article 9                 Termination of Agreement

 

This Agreement will come into force immediately
and will remain in force, provided the C shares have been issued, as long as
there is a balance in the C share premium reserve. It will terminate
automatically as soon as, after the C shares have been issued, there is no
longer any balance in the C share premium reserve.

 

Article 10               Assignment

 

Eurand may not assign this agreement (contractsoverneming) or assign any of its rights thereunder
without the prior written consent of WP. Each of WPP and WPVI may assign this
agreement or assign any of their rights thereunder to one of their affiliates,
provided that such assignment shall require notification to Eurand.

 

Article 11               Governing
Law

 

This Agreement shall be governed by and
construed in accordance with the laws of the Netherlands.

 

6

 

Article 12               Counterparts

 

This Agreement may be executed in any number of
counterparts, all of which, taken together constitute one agreement and any
party may enter into this agreement by executing a counterpart.

 

This Agreement has been signed on 30 November
2006 and amended on • 2007.

 

	
   

  	
   

  
	
  Warburg, Pincus Partners LLC

  
	
  by: Warburg Pincus & Co, its Managing
  Member

  
	
   

  	
  by:

  
	
   

  	
  title:

  
			

 

 

	
   

  	
   

  
	
  Warburg, Pincus Ventures
  International, L.P.

  
	
  by: Warburg, Pincus Partners LLC, its General
  Partner

  
	
   

  	
  by: Warburg Pincus
  & Co, its Managing Member

  
	
   

  	
  by:

  
	
   

  	
  title:

  
				

 

 

	
   

  	
   

  
	
  Eurand N.V.

  
	
  by:

  
	
  title:

  

 

7

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