Asset Purchase Agreement [Amendment No. 1] - AstraZeneca AB and aaiPharma LLC
FIRST AMENDMENT TO ASSET PURCHASE AGREEMENT
This FIRST AMENDMENT TO ASSET PURCHASE AGREEMENT (the "Amendment") is made this
22nd day of July 2003, with an effective date as of December 31, 2002, by and
between ASTRAZENECA AB, a corporation organized under the laws of Sweden, on
behalf of itself and its relevant Affiliates ("Seller"), and AAIPHARMA LLC, a
Delaware limited liability company ("Buyer"), a wholly-owned subsidiary of
aaiPharma Inc. and f/k/a NeoSan Pharmaceuticals Inc.
WHEREAS, Buyer and Seller are parties to that certain Asset Purchase Agreement,
dated as of July 25, 2001, (the "APA") relating to the sale by Seller and
purchase by Buyer of the Purchased Assets (as defined in the APA); and
WHEREAS, the parties now wish to amend certain terms and conditions of the APA
as set forth herein.
NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants
and agreements contained herein, the receipt and sufficiency of which is hereby
acknowledged by the parties hereto, and intending to be legally bound hereby,
the parties hereby agree as follows:
1. DEFINITIONS. All capitalized terms used and not defined herein
shall have the meanings ascribed thereto in the APA.
2. AMENDMENT OF SECTION 1.01.
The following definitions are hereby added to Section 1.01:
(eeee) "Approvable Letter" means a written communication to an
applicant from FDA stating that FDA will approve the applicant's NDA if specific
additional information or material is submitted or specific conditions are met
in accordance with 21 CFR 314.110.
(ffff) "Approval of Application" means a written communication to an
applicant from FDA approving the applicant's NDA in accordance with 21 CFR
3114.105.
(gggg) "CFR" means the United States Code of Federal Regulations.
(hhhh) "NDA" means a New Drug Application submitted in accordance with
the federal Food, Drug and Cosmetic Act, as amended.
(iiii) "Payment Date" means August 17, 2004.
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(jjjj) "Postapproval Study" means a study requested or required by FDA
as a condition to maintaining NDA approval.
(kkkk) "Reformulation NDA" means each of (i) NDA 21-643 filed by Buyer
with FDA (relating to the pharmacy bulk package of Reformulated MVI-12 with ten
(10) doses per vial in a two-vial application), as the same may be amended or
supplemented, and (ii) NDA 21-625 filed by Buyer with FDA (relating to other
packaging configurations of Reformulated MVI-12), as the same may be amended or
supplemented.
(llll) "Reformulated MVI-12" means MVI-12 Product that includes
increased dosages of vitamins B1, B6, C, and folic acid and the addition of
vitamin K in accordance with the Federal Register Notice published by the FDA on
April 20, 2000 [Docket No. 79N-0113]
3. AMENDMENT OF SECTION 4.01.
(a) Subsection 4.01(a) is hereby amended by deleting the term
"Second Contingent Installment" from the parenthetical phrase contained in the
last clause thereof.
(b) Subsection 4.01(a)(iv) is hereby deleted in its entirety and
replaced with the word "Reserved."
(c) Subsection 4.01 (a)(v) is hereby deleted in its entirety and
replaced with the following:
"subject to Section 4.01A below, on the Payment Date, an
additional $43.5 million ("Remaining Purchase Price") in
immediately available funds by wire transfer into an account
designated by Seller two business days before such amount is
due;"
(d) The last paragraph of Section 4.01 is hereby deleted in its
entirety and replaced with the following new Section 4.01A:
"4.01A Reduction of Remaining Purchase Price.
(a) The Remaining Purchase Price shall be paid
to Seller in accordance with Section 4.01(a)(v) above if, with
respect to each Reformulation NDA, either (i) FDA delivers an
Approval of Application of such Reformulation NDA (which may
contain a request by FDA that one or more Postapproval Studies
be conducted with respect to Reformulated MVI-12 and which
Approval of Application shall cover each packaging
configuration submitted for approval in such Reformulation
NDA) and each packaging configuration of Reformulated MVI-12
approved in such Approval of Application has a minimum shelf
life of twelve months ("FDA Approval") or (ii) FDA delivers an
Approvable Letter with respect to such Reformulation NDA in
which FDA states that the only additional information
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or material required for approval of such Reformulation NDA by
FDA and/or the only conditions that are required to be
satisfied in order for FDA to approve such Reformulation NDA
(in either case, before approving the packaging configurations
covered thereby with minimum shelf lives of twelve months)
relate to the name of Reformulated MVI-12 ("FDA Approvable
Status"); provided that (x) if FDA Approval or FDA Approvable
Status of either Reformulation NDA is not obtained by December
31, 2002 (the "Penalty Date"), then the Remaining Purchase
Price shall be reduced by $1 million for each full month
thereafter until the month in which FDA Approval or FDA
Approvable Status of either Reformulation NDA is obtained
("Monthly Penalty") and (y) if FDA Approval or FDA Approvable
Status of each Reformulation NDA is not obtained on or before
the Outside Date (as defined herein), then the Remaining
Purchase Price will equal zero. For purposes of this
Agreement, "Outside Date" means May 31, 2004, or such later
date as may be required in accordance with the following
paragraphs in this Section.
(b) Buyer shall be solely responsible for
conducting any and all Postapproval Studies required by the
FDA with respect to Reformulated MVI. In no event will the
Remaining Purchase Price due to Seller or the Payment Date be
affected by FDA's requirement of Postapproval Studies.
(c) If, in any Approvable Letter delivered by
FDA with respect to either Reformulation NDA, FDA states that
information or material is required for approval of such
Reformulation NDA by FDA and/or there are conditions that are
required to be satisfied in order for FDA to approve such
Reformulation NDA in addition to those relating to the name of
Reformulated MVI-12, Buyer shall provide Seller (i) with all
material information that is already in Buyer's possession at
the time of receipt of such Approvable Letter and is readily
available to be provided to Seller (the "Existing Data"), and
(ii) with reasonable reanalyses of such Existing Data, in each
case in (i) and (ii) above as reasonably requested by Seller
in connection with responding to such Approvable Letter, as
promptly as commercially practicable (and within five (5)
business days where commercially practicable) after such
request by Seller, or as mutually agreed to by the parties.
Notwithstanding the foregoing sentence, Buyer will respond
within five (5) business days to all Manufacturer requests
concerning the name of Reformulated MVI-12. If Buyer fails to
provide all such information of a material nature within the
timeframe specified in the preceding sentences, (a) the
Outside Date shall be extended by the number of days from the
end of the timeframe specified in the preceding sentences
through and including the day on which Buyer provides such
information (a "Delay Period") and (b) the accrual of the
Monthly Penalty shall be suspended for the Delay Period by
adding such Delay Period onto the end of the calendar month in
which such failure occurs before the Monthly Penalty would
again apply, with corresponding adjustments of the date
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that the Monthly Penalty would apply in subsequent months
where the circumstances therefor then apply. (By way of
example and not by way of limitation, if a six-day Delay
Period occurred in October 2003, the Monthly Penalty
previously applicable for October would thereafter apply six
days into November and six days into each subsequent month,
assuming the circumstances for the Monthly Penalty were then
applicable in such month.) In the event that such extension
would otherwise cause the Outside Date to fall on a day other
than a Business Day, the Outside Date shall be the next
succeeding Business Day. Such information that may be
requested from Seller hereunder, and readily available to be
provided to Seller, includes Existing Data pertaining to
analytical data, methods qualification data, analytical
methods validation information, specification setting, and
label issues, and reasonable reanalyses of Existing Data
related to the foregoing examples.
4. AMENDMENT OF APA SECTION 8.19.
(a) Section 8.19 is hereby amended by replacing the term
"Reformulation SNDA" in each place it appears with the term "Reformulation
NDAs."
(b) The language in the first sentence of Subsection 8.19(b)
reading "Upon the earlier of FDA's approval of the Reformulation SNDA or
Seller's notice to Buyer that it is abandoning its efforts to obtain such
approval," is hereby changed to read "Upon the earliest to occur of FDA Approval
or FDA Approvable Status of the two Reformulation NDAs, Seller's notice to Buyer
that it is abandoning its efforts to obtain such approval, or August 17, 2004."
(c) Subsection 8.19(d) is hereby amended by adding the following
new clause at the end thereof:
", including all regulatory filing fees related to the filing
of the two Reformulation NDAs."
5. AMENDMENT OF SECTION 13.02.
The following provision is hereby added after the last
sentence of Section 13.02.
"Buyer shall provide to Seller a copy of all Governmental or
Regulatory Authority correspondence regarding either
Reformulation NDA received by Buyer, that does not clearly
indicate that Seller has also received a copy of such
correspondence, or a copy of all relevant portions of such
correspondence dealing with either Reformulation NDA, within
three (3) business days of receipt by Buyer. If Buyer fails to
provide any such correspondence within the timeframe specified
in the preceding sentence and Seller has not otherwise
received a copy of such correspondence, the Outside
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Date shall be extended by the relevant Delay Period (i.e., the
number of days from the end of the timeframe specified in the
preceding sentence through and including the day on which
Buyer provides such correspondence or relevant portions
thereof to Seller) and the accrual of the Monthly Penalty
shall be suspended for the Delay Period by adding such Delay
Period onto the end of the calendar month in which such
failure occurs before the Monthly Penalty would again apply,
with corresponding adjustments of the date that the Monthly
Penalty would apply with respect to subsequent months where
the circumstances therefor then apply. In the event that such
extension would otherwise cause the Outside Date to fall on a
day other than a Business Day, the Outside Date shall be the
next succeeding Business Day."
6. ASSIGNMENT. APA Section 13.07 is hereby deleted in its
entirety and replaced with the following:
"This Agreement may not be assigned by either party, in whole
or in part, without the prior written consent of the other
party, which consent shall not be unreasonably withheld.
Notwithstanding the foregoing, either party may assign this
entire Agreement and its rights and obligations hereunder to
any of its Affiliates with a guarantee of performance by the
assigning party. Any assignment in violation of this Section
shall be void. All validly assigned rights and obligations of
the parties shall be binding upon and inure to the benefit of
and be enforceable against the permitted assigns of such
party. If either party seeks and obtains the other party's
consent to assign its rights or obligations to a third party,
the assignee shall assume all rights and obligations of its
assignor under this Agreement."
7. NO OTHER AMENDMENTS. Except as expressly amended hereby, all
other terms and conditions of the APA shall remain in full force and effect.
8. HEADINGS. The headings used in this Amendment have been
inserted for convenience of reference only and do not define or limit the
provisions hereof.
9. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE APPLICABLE TO
CONTRACTS EXECUTED AND PERFORMED IN SUCH STATE, WITHOUT GIVING EFFECT TO
CONFLICTS OF LAWS PRINCIPLES.
10. COUNTERPARTS. This Amendment may be executed in any number of
counterparts and by facsimile, each of which will be deemed an original, but all
of which together will constitute one and the same instrument
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IN WITNESS WHEREOF, the parties have caused their respective duly authorized
officers to execute this Amendment which shall be effective as of the day and
year first above written.
aaiPHARMA LLC ASTRAZENECA AB
By: /S/ DAVID M. HURLEY By: /S/ GLENN M. ENGELMANN
--------------------------- --------------------------------------
Name: David M. Hurley Name: Glenn M. Engelmann
Title: President Title: Attorney-in-fact
Date: July 22, 2003 Date: July 25, 2003
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AMENDMENT TO AAIPHARMA INC. GUARANTY
WHEREAS, pursuant to a Guaranty attached to the Asset Purchase
Agreement (the "APA"), dated as of July 25, 2001, by and between AstraZeneca AB,
on behalf of itself and its relevant Affiliates ("Seller"), andaaiPharma LLC,
f/k/a NeoSan Pharmaceuticals Inc. ("Buyer"), aaiPHARMA Inc. has guaranteed the
performance by Buyer of its obligations under the APA; and
WHEREAS, Buyer and Seller have amended the APA on the foregoing terms
and conditions.
NOW, THEREFORE, in consideration of Seller's entering into, and
continued performance under, the APA, the Guaranty is hereby amended to add the
phrase, "as amended from time to time," immediately after the word "Agreement"
in the fourth line thereof.
IN WITNESS WHEREOF, aaiPHARMA Inc. has caused its duly authorized
officer to execute this amendment which shall be effective as of July 22, 2003.
aaiPHARMA Inc.
By: /S/ PHILIP S. TABBINER
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Name: Philip S. Tabbiner
Title: Chief Executive Officer