Exhibit 10.6
CONSENT AND LIMITED WAIVER AGREEMENT
This
Consent and Limited Waiver Agreement (this “Waiver”) is entered into
as of the November 1, 2019, by and among Peter Steelman
(“Steelman”), James Flynn
(“Flynn”), and Deerfield
CSF, LLC, on behalf of itself and its affiliates
(“Deerfield”, and
collectively with Steelman and Flynn, the “Deerfield Parties”),
Avadel U.S. Holdings, Inc. and its subsidiaries and affiliates
(collectively, “Avadel”), Armistice
Capital Master Fund, Ltd. (“Armistice”), Cerecor Inc.
(“Cerecor”), Aytu
BioScience, Inc. (“Buyer”) and Aytu
Therapeutics LLC (“Aytu
Therapeutics”).
RECITALS
WHEREAS, the
Deerfield Parties and Avadel (including through its affiliated
entities) are parties to that certain Membership Interest Purchase
Agreement dated as of February 5, 2016, as may be amended from time
to time (the “Deerfield
Agreement”);
WHEREAS, pursuant
to that certain Asset Purchase Agreement dated February 12, 2018
(the “Prior
APA”), Cerecor purchased from Avadel certain assets
and assumed certain liabilities, including certain of
Avadel’s liabilities under the Deerfield
Agreement;
WHEREAS, Cerecor
and Buyer have entered into an Asset Purchase Agreement dated as of
October 10, 2019 (the “APA”) pursuant to which
Buyer will purchase certain assets from Cerecor and assume certain
of Cerecor’s liabilities, including all of Cerecor’s
assets and liabilities arising under the Deerfield Agreement and,
to the extent related to or arising out of the operation of the
Business (as defined in the APA) after the Closing (as defined in
the APA), the Prior APA (the “Asset
Purchase”);
WHEREAS, each of
Armistice and Cerecor have agreed to enter into Guarantees in favor
of the Deerfield Parties in substantially the forms attached hereto
as Exhibits A-1 and
A-2 (the “Armistice Guaranty” and
“Cerecor
Guarantee”, respectively, and collectively, the
“Guarantees”);
WHEREAS, Armistice
has agreed to deposit $15,000,000 (the “Escrow Funds”) in an
escrow account (the “Escrow Account”) governed
by that certain escrow agreement dated on or about the date hereof
by and among Armistice, the Deerfield Parties and JPMorgan Chase
Bank, N.A. (the “Escrow Agent”), in
substantially the form attached hereto as Exhibit B (the “Escrow Agreement”) for
the purpose of securing the portion of the Primary Obligations
under the Armistice Guarantee comprised of the balloon payment of
$15,000,000 due to the Deerfield Parties by Buyer on the last
business day of January 2021 or earlier in accordance with Section
1.6(g) of the Deerfield Agreement (the “Balloon Payment
Obligation”);
WHEREAS, neither
Buyer nor Cerecor would agree to consummate the Asset Purchase
without the prior written consent, release and limited waiver of
and by Avadel and the Deerfield Parties as set forth herein;
and
WHEREAS, in
consideration of Buyer’s agreement to assume certain
liabilities under the Deerfield Agreement as set forth in the APA,
as well as the Escrow Agreement and the Guarantees, the Deerfield
Parties and Avadel desire to provide this consent, release and
limited waiver.
NOW,
THEREFORE, in consideration of the premises and of the mutual
covenants, conditions and agreements set forth herein and for other
good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto, intending to be
legally bound, hereby agree as follows.
1. Defined Terms. Capitalized
terms used herein (including in the preamble and recitals above)
but not otherwise defined herein have the meanings ascribed to them
in the Deerfield Agreement.
2. Reliance. The parties hereto
acknowledge and agree that the effectiveness of the Deerfield
Parties’ consent and waiver, as set forth in Sections 6 and 7
below, is contingent upon (a) Armistice entering into the Escrow
Agreement and depositing $15,000,000 in the Escrow Account
thereunder, (b) Armistice and Cerecor entering into the Guarantees
and (c) payment by Cerecor of the attorney fees incurred by the
Deerfield Parties in connection with transactions contemplated
hereby.
3. Security
Arrangements.
(a) In the event that
the Deerfield Parties do not receive payment of the Balloon Payment
Obligation in full when due and the Escrow Funds are still in the
Escrow Account, then, upon written request from Deerfield,
Armistice and the Deerfield Parties shall sign and deliver to the
Escrow Agent a joint written instruction sufficient under the
Escrow Agreement to cause the Escrow Agent to deliver Escrow Funds
to the Deerfield Parties in an amount sufficient such that the
Deerfield Parties receive the amount of the Balloon Payment
Obligation in full with any excess Escrow Funds being disbursed to
Armistice. The Deerfield Parties acknowledge and agree that they
will seek payment from the Escrow Funds pursuant to this Section
3(a) before requesting payment from Avadel pursuant to the Avadel
Guarantee; provided, that such agreement
does not limit the rights of the Deerfield Parties pursuant to the
Avadel Guarantee in the event that payment is not timely made from
the Escrow Funds with respect to the Balloon Payment
Obligation.
(b) In the event that
the Deerfield Parties do receive payment of the Balloon Payment
Obligation in full when due and the Escrow Funds are still in the
Escrow Account, then, upon written request from Armistice,
Armistice and the Deerfield Parties shall sign and deliver to the
Escrow Agent a joint written instruction sufficient under the
Escrow Agreement to cause the Escrow Agent to deliver the Escrow
Funds to Armistice.
(c) In
the event that Armistice arranges for an Acceptable Letter of
Credit to be issued in favor of the Deerfield Parties, then, upon
written request from Armistice, Armistice and the Deerfield Parties
shall sign and deliver to the Escrow Agent a joint written
instruction sufficient under the Escrow Agreement to cause the
Escrow Agent to deliver the Escrow Funds to Armistice. An
“Acceptable Letter of Credit” means a letter of credit
that is (i) issued by a bank domiciled in the United States
acceptable to Deerfield, (ii) on a form acceptable to Deerfield,
(iii) is in the amount of $15,000,000, (iv) is for the benefit of
the Deerfield Parties, (v) does not expire until the last business
day of February 2021, and (vi) permits the Deerfield Parties to
draw on such letter of credit immediately if the Deerfield Parties
do not receive payment of the Balloon Payment Obligation in full
when due.
4. Assumption. Buyer acknowledges
and agrees that: (i) it has assumed all obligations under the
provisions of the Deerfield Agreement set forth on Appendix A; (ii)
this limited waiver of the Asset Purchase as an Acceleration
Trigger Event only applies to the Asset Purchase and any future
events, facts or circumstances that constitute an Acceleration
Trigger Event are not waived; (iii) the definition of “Net
Sales” in the Deerfield Agreement shall hereby be deemed to
include, among other items, the amounts invoiced for sales of
Products by or on behalf of Buyer or any of its Affiliates or any
direct or indirect assignee or licensee of Buyer or any of its
Affiliates; and (iv) the audit rights of the Deerfield Parties in
Section 1.6(d) of the Deerfield Agreement shall apply to the books
and records of Buyer and its Affiliates.
5. Security Interest.
Buyer’s subsidiary, Aytu Therapeutics, which will hold the
Purchased Assets (as defined below), hereby pledges, assigns,
hypothecates, transfers and grants to the Deerfield Parties, a
first priority lien upon and security interest in, all of its
right, title and interest in and to the Purchased Assets (as
defined in the APA) to the extent such Purchased Assets were also
“Purchased Assets” under the Prior APA. The Purchased
Assets shall secure the full and prompt payment, at any time and
from time to time as and when due (whether at the stated payment
date, by acceleration or otherwise), of Buyer’s obligations
under the provisions of the Deerfield Agreement set forth on
Appendix A. Buyer and the Deerfield Parties acknowledge that the
Purchased Assets constitute the FSC Assets Collateral for purposes
of Buyer’s obligations under the provisions of the Deerfield
Agreement set forth on Appendix A (including, without limitation,
Sections 1.7(b) and (c)).
6. Deerfield Consent and Limited
Waiver. The Deerfield Parties hereby (i) consent to the
Asset Purchase and Cerecor and Buyer’s entry into the APA for
all purposes, (ii) represent and warrant to Cerecor and Buyer that
to the actual knowledge of Steelman and Flynn no breach of the
Deerfield Agreement exists as of the date hereof and no such breach
will occur as a result of the consummation of the Asset Purchase,
(iii) agree that the Asset Purchase is not, and will not be deemed
to be, an Acceleration Trigger Event, (iv) irrevocably waive all
rights with respect to Section 1.6(g) of the Deerfield Agreement
only in connection with the Asset Purchase (but not any future
events), (v) irrevocably waive, discharge and release Cerecor and
Buyer from any claim that Cerecor or Buyer is in breach of Section
1.6(g) of the Deerfield Agreement only as a result of the Asset
Purchase (but not any future events), (vi) agree that the
provisions of the Deerfield Agreement set forth on Appendix A hereto (as such obligations
may be expressly modified therein with respect to the Deferred
Consideration and each Deferred Payment related thereto), and all
obligations of Cerecor arising thereunder, are assigned to Buyer,
and (vii) agree that if (a) Buyer is current in its payment
obligations to the Deerfield Parties and (b) makes a payment
to the Deerfield Parties in advance of such payment being due and
payable (a “Prepayment”), then Buyer
may designate whether such Prepayment is deemed to be a Fixed
Payment or a Deferred Payment.
7. Avadel Consent and Release. In
accordance with Section 7.6 of the Prior APA, Avadel hereby (a)
consents to Cerecor’s assignment to Buyer of all
Cerecor’s rights, interests and obligations under the Prior
APA and Cerecor and Buyer’s entry into the APA for all
purposes, and (b) represents and warrants to Cerecor and Buyer that
to the actual knowledge of Avadel no breach of the Prior APA exists
as of the date hereof and no such breach will occur as a result of
the consummation of the Asset Purchase. Avadel, on behalf of itself
and its Affiliates, hereby releases Cerecor from all obligations
under the Prior APA. Avadel further acknowledges and agrees to the
modification of the payment terms with respect to the Deferred
Consideration and Deferred Payments pursuant to the APA and agrees
that such modification is hereby incorporated into the terms of the
Deerfield Agreement, subject to the guarantee of such obligations
by Armistice pursuant to the Armistice Guarantee. Avadel also
acknowledges and agrees that its Guarantee (the “Avadel Guarantee’) issued
on February 16, 2018, in favor of the Deerfield Parties remains in
full force and effect notwithstanding the assignment of the
Obligations (as defined in the Avadel Guarantee) to Buyer and the
modification of the payment terms with respect to the Deferred
Consideration and Deferred Payments.
8. No Breach. Cerecor hereby
represents and warrants that no breach of the Deerfield Agreement
exists as of the date hereof.
9. No Modification. Except as
amended, waived or consented to hereby, the Deerfield Agreement
remains unmodified and in full force and effect.
10. Successors and Assigns. The
provisions of this Waiver will inure to the benefit of and be
binding on each of the Deerfield Parties, Cerecor and Buyer and
their permitted assigns (if any).
11. Governing Law. This Waiver
shall be governed by, and construed, interpreted and enforced in
accordance with, the laws of the Delaware. Any legal action or
proceeding with respect to this Waiver will be brought solely and
exclusively in any state or federal court of competent jurisdiction
in Delaware. By execution and delivery of this Waiver, each party
hereto hereby irrevocably consents to and accepts, for itself and
in respect of its property, generally and unconditionally the sole
and exclusive jurisdiction of such courts. Each party hereto hereby
further irrevocably waives any objection, including any objection
to the laying of venue or based on the grounds of forum non
conveniens, which it may now or hereafter have to the bringing of
any action or proceeding in such jurisdiction in respect of this
Waiver.
12. Notice. Each party and express
beneficiary irrevocably consents to the service of process out of
any of the courts referred to in this Waiver in any such suit,
action or proceeding by the mailing of copies thereof by registered
or certified mail, postage prepaid, to it at its address set forth
in the Deerfield Agreement, or with respect to Cerecor, to:
Cerecor, Inc., 540 Gaither Road, Suite 400, Rockville, Maryland
20850, attention: Joe Miller, via email: jmiller@cerecor.com, with
a copy (that does not constitute notice) to Wyrick Robbins Yates
& Ponton LLP, 4101 Lake Boone Trail, Suite 300, Raleigh, North
Carolina 27607, attention: Don Reynolds, via email:
dreynolds@wyrick.com, or with respect to Buyer, to: Aytu
BioScience, Inc., 373 Inverness Parkway, Suite 206, Englewood,
Colorado 80112, attention: David Green, CFO, via email:
dgreen@aytubio.com, with a copy (that does not constitute notice)
to Dorsey & Whitney, 111 S Main Street, Suite 2100, Salt Lake
City, UT 84111, attention: Nolan Taylor, or with respect to
Armistice, to: Armistice Capital Master Fund, Ltd., 510 Madison
Avenue, 22nd Floor, New York, NY
10022, attention: Anthony Cordone, via email:
acordone@armisticecapital.com. Each party irrevocably waives any
objection to such service of process and further irrevocably waives
and agrees not to plead or claim in any suit, action or proceeding
commenced hereunder that service of process was in any way invalid
or ineffective. Nothing herein shall affect the right of a party to
serve process on the other party in any other manner permitted by
law.
13. Counterparts. This Waiver may
be executed in any number of counterparts, and by different parties
hereto in separate counterparts, each of which when so delivered
shall be deemed an original, but all of which counterparts shall
constitute but one and the same instrument. Any counterpart may be
executed by facsimile or pdf signature and such facsimile or pdf
signature shall be deemed an original.
14.
Disclosure.
On or before 8:00 a.m.,
New York time, on the business day immediately following the date
hereof, Buyer shall file a
Current Report on Form 8-K meeting all of the requirements of Item
1.01 thereof, which Form 8-K shall disclose the closing of the
transactions contemplated by the APA, disclose all the material
terms of the transactions contemplated by this Waiver and the
Guarantees (and any previously undisclosed terms of the APA) and
shall attach each of the APA (to the extent not previously publicly
filed), this Waiver and the Guarantees, in each of their
entireties. Each of Avadel, Cerecor, and Buyer (each a
“Disclosing Party”) expressly acknowledges, represents
and agrees that after such filing, (i) all material, non-public information
(if any) provided or made available to the Deerfield Parties and
their affiliates (and their respective agents and representatives)
by such Disclosing Party or any of its officers, directors,
employees, affiliates or agents in connection with the transactions
contemplated by the APA, the Prior APA, this Waiver, the Guarantees, or
otherwise prior to the date hereof, shall have been publicly
disclosed. and (ii) that from and after such filing, the
Deerfield Parties and their affiliates (and their respective agents
and representatives) shall not have any duty to any Disclosing
Party of trust or confidence with respect to, or a duty to any
Disclosing Party not to trade in any securities on the basis of,
any information regarding such Disclosing Party (unless expressly
agreed to by such Deerfield Party in a written definitive and
binding and binding agreement executed by such Disclosing Party and
Deerfield Party or customary oral (confirmed by e-mail) “wall
cross” agreement).
[Signature
Page Follows]
IN
WITNESS WHEREOF, the parties hereto have executed this Consent and
Limited Waiver Agreement as of the day and year first above
written.
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DEERFIELD
PARTIES:
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Deerfield
CSF, LLC
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By:_________________________________
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Name:_______________________________
Title:________________________________
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____________________________________
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Peter
Steelman
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____________________________________
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James
Flynn
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AVADEL:
Avadel
U.S. Holdings, Inc.
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By:
____________________________________
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Name: ____________________________________
Title:
____________________________________
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ARMISTICE
Armistice
Capital Master Fund, Ltd.
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By:
____________________________________
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Name: ____________________________________
Title:
____________________________________
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CERECOR:
Cerecor
Inc.
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By:
____________________________________
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Name: ____________________________________
Title:
____________________________________
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BUYER:
Aytu
BioScience, Inc.
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By:
____________________________________
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Name: ____________________________________
Title:
____________________________________
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BUYER
SUBSIDIARY:
Aytu
Therapeutics LLC
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By:
____________________________________
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Name: ____________________________________
Title:
____________________________________
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Exhibit
A-1
Armistice
Guarantee
GUARANTEE
GUARANTEE, dated as of November 1, 2019
(this “Guarantee”), made by Armistice
Capital Master Fund, Ltd. (the “Guarantor”), in favor of Deerfield
CSF, LLC, Peter Steelman and James Flynn (each a
“Guaranteed
Party” and collectively, the “Guaranteed
Parties”).
WHEREAS, Avadel US
Holdings, Inc., Avadel Pharmaceuticals plc, and certain of their
affiliated parties (collectively, “Avadel”) and the Guaranteed
Parties, are parties to that certain Membership Interest Purchase
Agreement, dated February 5, 2016 (the “MIPA”);
WHEREAS, Avadel
entered into an Asset Purchase Agreement with Cerecor Inc.
(“Cerecor”)
dated February 12, 2018 (the “Prior APA”);
WHEREAS, Cerecor
has entered into an Asset Purchased Agreement with Aytu BioScience,
Inc. (“Debtor”),
dated as of or about the date hereof (the “APA”);
WHEREAS, under the
APA, Debtor will purchase certain assets from Cerecor and assume
certain of Cerecor’s liabilities, including all of
Cerecor’s assets and liabilities arising under the MIPA and,
to the extent related to or arising out of the operation of the
Business (as defined in the APA) after the Closing (as defined in
the APA), the Prior APA (the “Assignment”);
WHEREAS,
notwithstanding the Assignment, Avadel remains obligated to the
Guaranteed Parties under such assigned rights and
obligations;
WHEREAS, in
connection with the Assignment, the Guaranteed Parties have
requested that the Guarantor provide this Guarantee and Guarantor
is willing to provide such Guarantee; and
WHEREAS, Cerecor
also intends to provide a guarantee of the Obligations (as defined
below) in favor of the Guaranteed Parties dated on or about the
date hereof (the “Cerecor
Guarantee”);
NOW THEREFORE, for
valuable consideration, the receipt and sufficiency of which are
hereby conclusively acknowledged by the Guarantor, the Guarantor
hereby agrees in favor of the Guaranteed Parties as
follows:
1. Guarantee.
The Guarantor hereby unconditionally and irrevocably, as a primary
obligor and not only a surety, guarantees the prompt payment and
performance to the Guaranteed Parties when due of any of
Debtor’s obligations set forth in Section 1.2(a), Section
1.6(a), Section 1.6(b), and Section 1.6(g) of the MIPA (whether
direct or indirect, joint or several, absolute or contingent,
matured or unmatured) (collectively, the “Primary Obligations”). The
Guarantor further agrees that, with respect to Debtor’s
obligation to pay the Deferred Payments pursuant to Section 1.6(a)
of the MIPA, if the aggregate of the Deferred Payments made by
Debtor in any full calendar month between (and including) November
1, 2019 and February 5, 2026 is less than $100,000 and the
Guaranteed Parties have not received payment of such deficiency
when due, then the Guarantor shall pay to the Guaranteed Parties
the amount of such deficiency (the “Deferred Obligation”), it being
agreed that, if Debtor’s obligation to pay the Deferred
Payments is still in effect, the foregoing Deferred Obligation
shall be prorated on a daily basis for the month of February
2026;provided,
however, that if
Debtor’s obligation to pay the Deferred Payments terminates
because $12,500,000 of Deferred Payments has been paid in the
aggregate to the Guaranteed Parties (including payments prior to
the date hereof), the foregoing obligation of Guarantor shall no
longer be in effect. The Deferred Payment Obligation and the
Primary Obligations hereinafter collectively referred to as, the
“Obligations”.
2. Payment by
Guarantor. If all or any part of the Obligations shall not
be punctually paid when due, whether at demand, maturity,
acceleration or otherwise, the Guarantor shall, immediately upon
demand by the Guaranteed Parties, and without presentment protest,
notice of protest, notice of non-payment, notice of intention to
accelerate the maturity, notice of acceleration of the maturity, or
any other notice whatsoever, but subject to the other terms of this
Guarantee, pay in lawful money of the United States of America, the
amount then due on the Obligations to the Guaranteed Parties at the
Guaranteed Parties’ address set forth herein. Such demand(s)
may be made at any time coincident with or after the time any of
the Obligations become due. Such demand shall be deemed made, given
and received in accordance with the notice provisions
hereof.
3. Additional
Security. If Guarantor fails to satisfy the portion of the
Primary Obligations comprised of the balloon payment of $15,000,000
due to the Guaranteed Parties on the last business day of January
2021 or earlier in accordance with Section 1.6(g) of the MIPA (the
“Balloon Payment
Obligation”), then Guarantor acknowledges and agrees
that the Guaranteed Parties may take any and all actions provided
for under, as applicable, the escrow agreement dated on or about
the date hereof by and among the Guarantor, the Guaranteed Parties,
and JPMorgan Chase Bank, N.A., or any Letter of Credit subsequently
provided by Guarantor in favor of the Guaranteed Parties and with
respect solely to the Balloon Payment
Obligation.
4. No Duty To Pursue
Others. It shall not be necessary for the Guaranteed Parties
(and the Guarantor hereby waives any rights that the Guarantor may
have to require the Guaranteed Parties), in order to enforce the
obligations of the Guarantor hereunder, first to (i) institute suit
or exhaust its remedies against Debtor or any other party that may
be liable on the Obligations, (ii) enforce the Guaranteed
Parties’ rights against any collateral which shall have been
given to secure the Obligations, (iii) enforce the Guaranteed
Parties’ rights against any other guarantors of the
Obligations, (iv) join Debtor or any other party liable on the
Obligations in any action seeking to enforce this Guarantee, or (v)
resort to any other means of obtaining payment of the Obligations;
provided, however, that if the Guaranteed Parties enforce their
rights against collateral given by Debtor or the Guarantor, the
Obligations shall be reduced accordingly.
5. Amount. The
aggregate amount covered by this Guarantee shall not exceed
$25,875,000 less any amount paid pursuant to the Cerecor Guarantee,
plus reasonable costs and expenses, if any, including reasonable
attorneys’ fees, incurred by the Guaranteed Parties to
enforce any of its rights hereunder;provided, however, that such
costs and expenses shall be payable by the Guarantor only to the
extent the Guaranteed Parties are successful in enforcing this
Guarantee (collectively, the “Guaranteed Cap”). The
Guarantor’s liability under this Guarantee is specifically
limited to the payment and performance of the Obligations (even if
such Obligations are deemed to be damages).
6. Release of
Obligations. This Guarantee will remain in full force and
effect until all of the Obligations are irrevocably and
unconditionally performed and paid in full or Debtor ceases to have
any obligations in respect thereof in accordance with the terms of
the APA.
7. Nature of
Guarantee. This Guarantee may not be revoked by the
Guarantor and shall continue to be effective with respect to any
Obligations arising or created after any attempted revocation by
the Guarantor. In the event that any payment of the Debtor to the
Guaranteed Parties in respect of any Obligations is rescinded or
must otherwise be returned to the Debtor or surrendered to any
person for any reason whatsoever, then the Obligations or part
thereof intended to be satisfied shall be reinstated or returned by
the Guaranteed Parties to the Guarantor, and this Guarantee shall
continue to be effective as if such payment had not been made or
value received notwithstanding any revocation thereof; provided,
however, that the Guaranteed Cap shall be reduced by the amount of
such rescinded or returned payment.
8. Obligations Not
Reduced by Offset. The Obligations and the liabilities and
obligations of Guarantor to the Guaranteed Parties hereunder shall
not be reduced, discharged, or released because or by reason of any
existing or future offset, claim or defense of Debtor, or any other
party, against a Guaranteed Party or against payment of the
Obligations, whether such offset, claim or defense arises in
connection with the Obligations (or the transactions creating the
Obligations) or otherwise;provided, however, that if a Guaranteed
Party proceeds against the Guarantor under the Obligations, the
Guarantor shall be afforded all rights and defenses against such
claim as would be available to the Debtor in connection with such
claim.
9. Liability
Absolute. Without limiting the generality of the foregoing,
the liability of the Guarantor will not be released, discharged,
diminished, limited or otherwise affected by: (i) any change in the
name, existence, structure, powers, business, constitution,
objects, capital, constating documents, by-laws, control or
ownership of the Debtor, the Guarantor or any other person, or (ii)
any insolvency, bankruptcy, reorganization or other similar
proceeding affecting the Debtor, it being the intention of the
Debtor and the Guarantor that the Guarantor’s obligations
hereunder shall not be discharged except by (a) the
Guarantor’s or Debtor’s performance of such
obligations, and then only to the extent of such performance, or
(b) any other termination of such obligations, and then only to the
extent of such termination.
10. Waivers.
Guarantor agrees to the provisions of the APA, and hereby waives
notice of (i) acceptance of this Guarantee, (ii) any amendment of
the APA, (iii) the execution and delivery by Debtor and the
Guaranteed Parties of any other agreement arising under or in
connection with the APA, (iv) the occurrence of any breach by
Debtor or an event of default; (v) the Guaranteed Parties’
transfer or disposition of the Obligations, or any part thereof,
(vi) protest, proof of non-payment or default by Debtor, or (vii)
any other action at any time taken or omitted by a Guaranteed
Party, and, generally, all demands and notices of every kind in
connection with this Guarantee or the APA, any documents or
agreements evidencing, securing or relating to any of the
Obligations and the obligations hereby guaranteed. Guarantor waives
(a) diligence, presentment, protest, demand for payment and notice
of default or nonpayment to or upon Buyer or any of them with
respect to the Obligations (b) notice of the existence or creation
or non-payment of all or any of the Obligations, and (c) all
diligence in collection or protection of or realization upon any
Obligations or any guaranty of any Obligations.
11. Governing Law;
Attornment. This Guarantee shall be governed by and
construed in accordance with the domestic laws of the State of
Delaware without giving effect to any choice or conflict of law
provision or rule (whether of the State of Delaware or any other
jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of Delaware. Any action, suit or
other proceeding, at law or in equity, arising out of or relating
to this Agreement or any agreements or transactions contemplated
hereby shall only be brought in any state or federal court located
in Delaware. THE PARTIES AGREE THAT JURISDICTION AND VENUE IN ANY
ACTION BROUGHT BY ANY PARTY PURSUANT TO THIS AGREEMENT SHALL
PROPERLY AND EXCLUSIVELY LIE IN SUCH COURTS. BY EXECUTION AND
DELIVERY OF THIS AGREEMENT, EACH PARTY IRREVOCABLY AND EXCLUSIVELY
SUBMITS TO THE JURISDICTION OF SUCH COURTS FOR ITSELF AND IN
RESPECT OF ITS PROPERTY WITH RESPECT TO SUCH ACTION. THE PARTIES
IRREVOCABLY AGREE THAT VENUE WOULD BE PROPER IN SUCH COURT, AND
HEREBY WAIVE ANY OBJECTION THAT SUCH COURT IS AN IMPROPER OR
INCONVENIENT FORUM FOR THE RESOLUTION OF SUCH ACTION. THE PARTIES
FURTHER AGREE THAT THE MAILING BY CERTIFIED OR REGISTERED MAIL,
RETURN RECEIPT REQUESTED, OF ANY PROCESS REQUIRED BY ANY SUCH COURT
SHALL CONSTITUTE VALID AND LAWFUL SERVICE OF PROCESS AGAINST THEM,
WITHOUT NECESSITY FOR SERVICE BY ANY OTHER MEANS PROVIDED BY
STATUTE OR RULE OF COURT. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN RESPECT TO ANY PROCEEDING DIRECTLY OR
INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS
AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY. EACH PARTY
CERTIFIES AND ACKNOWLEDGES THAT (I) NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR
OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (II) IT
UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF SUCH WAIVER,
(III) IT MAKES SUCH WAIVER VOLUNTARILY, AND (IV) IT HAS BEEN
INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE
MUTUAL WAIVERS AND CERTIFICATIONS IN PARAGRAPH.
12. Successors and
Assigns. The provisions of this Guarantee will be binding
upon and inure to the benefit of the Guaranteed Parties and will be
binding upon the Guarantor and its successors. This Guarantee may
not be assigned by the Guarantor or the Guaranteed Parties without
the prior written consent of the other.
13. Severability.
Wherever possible, any provision in this Guarantee which is held
invalid or unenforceable by a court of competent jurisdiction from
which no further appeal has or is taken shall, as to such
jurisdiction, be ineffective only to the extent of such prohibition
or unenforceability without invalidating the remaining provisions
of this Guarantee, and any such invalidity or unenforceability in
any one jurisdiction shall not invalidate or render unenforceable
such provision in any other jurisdiction.
14. Notice. All
notices, requests, claims, demands and other communications
hereunder shall be given (and shall be deemed to have been duly
given upon receipt) by hand delivery, by prepaid overnight courier
(providing written proof of delivery), by transmission-mail (with
confirmation of transmission other than by means of an
automatically- generated reply) or by certified or registered mail
(return receipt requested and first class postage prepaid),
addressed as follows (or at such other address for a party as shall
be specified by like notice):
If to the Guaranteed
Parties:
780 Third Avenue
37th
Floor
New York, NY
10017
Fax: (212)
573-8111
Email:
Attention: James E.
Flynn, Peter Steelman, David J. Clark
with a copy to
(which shall not constitute notice):
Robinson, Bradshaw
& Hinson, P.A.
101 North Tryon
Street, Suite 1900
Charlotte, NC
28246
Fax: (704)
339-3428
Email:
mhenry@robinsonbradshaw.com
Attention: Mark O.
Henry
If to the
Guarantor:
Armistice Capital
Master Fund, Ltd.
510 Madison Avenue;
22nd Floor
New York, NY
10022
Attn: Anthony
Cordone
e-mail:
acordone@armisticecapital.com
provided that any notice
received at the addressee’s location on any business day
after 5:00 p.m. (addressee’s local time) shall be deemed to
have been received at 9:00 a.m. (addressee’s local time) on
the next business day.
15. Amendment.
No term or provision of this Guarantee shall be amended, modified,
altered, waived or supplemented except in a writing signed by
Guarantor and the Guaranteed Parties.
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blank.]
THIS GUARANTEE executed effective
the date first written
above.
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Armistice
Capital Master Fund, Ltd.
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By:
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Acknowledged and
accepted:
Deerfield
CSF, LLC
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By:
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Name:
Title:
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______________________________
Peter
Steelman
______________________________
James
Flynn
Exhibit
A-2
Cerecor
Guarantee
GUARANTEE
GUARANTEE, dated as of November 1, 2019
(this “Guarantee”), made by Cerecor Inc.
(the “Guarantor”), in favor of Deerfield
CSF, LLC, Peter Steelman and James Flynn (each a
“Guaranteed
Party” and collectively, the “Guaranteed
Parties”).
WHEREAS, Avadel US
Holdings, Inc., Avadel Pharmaceuticals plc, and certain of their
affiliated parties (collectively, “Avadel”) and the Guaranteed
Parties, are parties to that certain Membership Interest Purchase
Agreement, dated February 5, 2016 (the “MIPA”);
WHEREAS, Avadel
entered into an Asset Purchase Agreement with the Guarantor dated
February 12, 2018 (the “Prior
APA”);
WHEREAS, the
Guarantor has entered into an Asset Purchased Agreement with Aytu
BioScience, Inc. (“Debtor”), dated as of or about the
date hereof (the “APA”);
WHEREAS, under the
APA, Debtor will purchase certain assets from the Guarantor and
assume certain of the Guarantor’s liabilities, including all
of the Guarantor’s assets and liabilities arising under the
MIPA and, to the extent related to or arising out of the operation
of the Business (as defined in the APA) after the Closing (as
defined in the APA), the Prior APA (the “Assignment”);
WHEREAS,
notwithstanding the Assignment, Avadel remains obligated to the
Guaranteed Parties under such assigned rights and
obligations;
WHEREAS, in
connection with the Assignment, the Guaranteed Parties have
requested that the Guarantor provide this Guarantee and the
Guarantor is willing to provide such Guarantee;
and
WHEREAS, Armistice
Capital Master Fund, Ltd. also intends to provide a guarantee of
the Obligations (as defined below) in favor of the Guaranteed
Parties dated on or about the date hereof (the “Armistice
Guarantee”);
NOW THEREFORE, for
valuable consideration, the receipt and sufficiency of which are
hereby conclusively acknowledged by the Guarantor, the Guarantor
hereby agrees in favor of the Guaranteed Parties as
follows:
16. Guarantee.
The Guarantor hereby unconditionally and irrevocably, as a primary
obligor and not only a surety, guarantees the prompt payment and
performance to the Guaranteed Parties when due of any amounts or
obligations set forth in Section 1.2(a), Section 1.6(a), Section
1.6(b), and Section 1.6(g) of the MIPA (whether direct or indirect,
joint or several, absolute or contingent, matured or unmatured)
(collectively, the “Primary
Obligations”). The Guarantor further agrees that, with
respect to Debtor’s obligation to pay the Deferred Payments
pursuant to Section 1.6(a) of the MIPA, if the aggregate of the
Deferred Payments made by Debtor in any full calendar month between
(and including) November 1, 2019 and February 5, 2026 is less than
$100,000 and the Guaranteed Parties have not received payment of
such deficiency when due, then the Guarantor shall pay to the
Guaranteed Parties the amount of such deficiency (the
“Deferred
Obligation”), it being agreed that, if Debtor’s
obligation to pay the Deferred Payments is still in effect, the
foregoing Deferred Obligation shall be prorated on a daily basis
for the month of February 2026;provided, however, that if Debtor’s
obligation to pay the Deferred Payments terminates because
$12,500,000 of Deferred Payments has been paid in the aggregate to
the Guaranteed Parties (including payments prior to the date
hereof), the foregoing obligation of Guarantor shall no longer be
in effect. The Deferred Payment Obligation and the Primary
Obligations hereinafter collectively referred to as, the
“Obligations”.
17. Payment by
Guarantor. If all or any part of the Obligations shall not
be punctually paid when due, whether at demand, maturity,
acceleration or otherwise, the Guarantor shall, immediately upon
demand by the Guaranteed Parties, and without presentment protest,
notice of protest, notice of non-payment, notice of intention to
accelerate the maturity, notice of acceleration of the maturity, or
any other notice whatsoever, but subject to the other terms of this
Guarantee, pay in lawful money of the United States of America, the
amount then due on the Obligations to the Guaranteed Parties at the
Guaranteed Parties’ address set forth herein. Such demand(s)
may be made at any time coincident with or after the time any of
the Obligations become due. Such demand shall be deemed made, given
and received in accordance with the notice provisions
hereof.
18. [Reserved].
19. No Duty To Pursue
Others. It shall not be necessary for the Guaranteed Parties
(and the Guarantor hereby waives any rights that the Guarantor may
have to require the Guaranteed Parties), in order to enforce the
obligations of the Guarantor hereunder, first to (i) institute suit
or exhaust its remedies against Debtor or any other party that may
be liable on the Obligations, (ii) enforce the Guaranteed
Parties’ rights against any collateral which shall have been
given to secure the Obligations, (iii) enforce the Guaranteed
Parties’ rights against any other guarantors of the
Obligations, (iv) join Debtor or any other party liable on the
Obligations in any action seeking to enforce this Guarantee, or (v)
resort to any other means of obtaining payment of the Obligations;
provided, however, that if the Guaranteed Parties enforce their
rights against collateral given by Debtor or the Guarantor, the
Obligations shall be reduced accordingly.
20. Amount. The
aggregate amount covered by this Guarantee shall not exceed
$25,875,000 less any amount paid pursuant to the Armistice
Guarantee, plus reasonable costs and expenses, if any, including
reasonable attorneys’ fees, incurred by the Guaranteed
Parties to enforce any of its rights hereunder; provided, however,
that such costs and expenses shall be payable by the Guarantor only
to the extent the Guaranteed Parties are successful in enforcing
this Guarantee (collectively, the “Guaranteed Cap”). The
Guarantor’s liability under this Guarantee is specifically
limited to the payment and performance of the Obligations (even if
such Obligations are deemed to be damages).
21. Release of
Obligations. This Guarantee will remain in full force and
effect until all of the Obligations are irrevocably and
unconditionally performed and paid in full or Debtor ceases to have
any obligations in respect thereof in accordance with the terms of
the APA.
22. Nature of
Guarantee. This Guarantee may not be revoked by the
Guarantor and shall continue to be effective with respect to any
Obligations arising or created after any attempted revocation by
the Guarantor. In the event that any payment of the Debtor to the
Guaranteed Parties in respect of any Obligations is rescinded or
must otherwise be returned to the Debtor or surrendered to any
person for any reason whatsoever, then the Obligations or part
thereof intended to be satisfied shall be reinstated or returned by
the Guaranteed Parties to the Guarantor, and this Guarantee shall
continue to be effective as if such payment had not been made or
value received notwithstanding any revocation thereof; provided,
however, that the Guaranteed Cap shall be reduced by the amount of
such rescinded or returned payment.
23. Obligations Not
Reduced by Offset. The Obligations and the liabilities and
obligations of Guarantor to the Guaranteed Parties hereunder shall
not be reduced, discharged, or released because or by reason of any
existing or future offset, claim or defense of Debtor, or any other
party, against a Guaranteed Party or against payment of the
Obligations, whether such offset, claim or defense arises in
connection with the Obligations (or the transactions creating the
Obligations) or otherwise;provided, however, that if a Guaranteed
Party proceeds against the Guarantor under the Obligations, the
Guarantor shall be afforded all rights and defenses against such
claim as would be available to the Debtor in connection with such
claim.
24. Liability
Absolute. Without limiting the generality of the foregoing,
the liability of the Guarantor will not be released, discharged,
diminished, limited or otherwise affected by: (i) any change in the
name, existence, structure, powers, business, constitution,
objects, capital, constating documents, by-laws, control or
ownership of the Debtor, the Guarantor or any other person, or (ii)
any insolvency, bankruptcy, reorganization or other similar
proceeding affecting the Debtor, it being the intention of the
Debtor and the Guarantor that the Guarantor’s obligations
hereunder shall not be discharged except by (a) the
Guarantor’s or Debtor’s performance of such
obligations, and then only to the extent of such performance, or
(b) any other termination of such obligations, and then only to the
extent of such termination.
25. Waivers.
Guarantor agrees to the provisions of the APA, and hereby waives
notice of (i) acceptance of this Guarantee, (ii) any amendment of
the APA, (iii) the execution and delivery by Debtor and the
Guaranteed Parties of any other agreement arising under or in
connection with the APA, (iv) the occurrence of any breach by
Debtor or an event of default; (v) the Guaranteed Parties’
transfer or disposition of the Obligations, or any part thereof,
(vi) protest, proof of non-payment or default by Debtor, or (vii)
any other action at any time taken or omitted by a Guaranteed
Party, and, generally, all demands and notices of every kind in
connection with this Guarantee or the APA, any documents or
agreements evidencing, securing or relating to any of the
Obligations and the obligations hereby guaranteed. Guarantor waives
(a) diligence, presentment, protest, demand for payment and notice
of default or nonpayment to or upon Buyer or any of them with
respect to the Obligations (b) notice of the existence or creation
or non-payment of all or any of the Obligations, and (c) all
diligence in collection or protection of or realization upon any
Obligations or any guaranty of any Obligations.
26. Governing Law;
Attornment. This Guarantee shall be governed by and
construed in accordance with the domestic laws of the State of
Delaware without giving effect to any choice or conflict of law
provision or rule (whether of the State of Delaware or any other
jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of Delaware. Any action, suit or
other proceeding, at law or in equity, arising out of or relating
to this Agreement or any agreements or transactions contemplated
hereby shall only be brought in any state or federal court located
in Delaware. THE PARTIES AGREE THAT JURISDICTION AND VENUE IN ANY
ACTION BROUGHT BY ANY PARTY PURSUANT TO THIS AGREEMENT SHALL
PROPERLY AND EXCLUSIVELY LIE IN SUCH COURTS. BY EXECUTION AND
DELIVERY OF THIS AGREEMENT, EACH PARTY IRREVOCABLY AND EXCLUSIVELY
SUBMITS TO THE JURISDICTION OF SUCH COURTS FOR ITSELF AND IN
RESPECT OF ITS PROPERTY WITH RESPECT TO SUCH ACTION. THE PARTIES
IRREVOCABLY AGREE THAT VENUE WOULD BE PROPER IN SUCH COURT, AND
HEREBY WAIVE ANY OBJECTION THAT SUCH COURT IS AN IMPROPER OR
INCONVENIENT FORUM FOR THE RESOLUTION OF SUCH ACTION. THE PARTIES
FURTHER AGREE THAT THE MAILING BY CERTIFIED OR REGISTERED MAIL,
RETURN RECEIPT REQUESTED, OF ANY PROCESS REQUIRED BY ANY SUCH COURT
SHALL CONSTITUTE VALID AND LAWFUL SERVICE OF PROCESS AGAINST THEM,
WITHOUT NECESSITY FOR SERVICE BY ANY OTHER MEANS PROVIDED BY
STATUTE OR RULE OF COURT. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN RESPECT TO ANY PROCEEDING DIRECTLY OR
INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS
AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY. EACH PARTY
CERTIFIES AND ACKNOWLEDGES THAT (I) NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR
OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (II) IT
UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF SUCH WAIVER,
(III) IT MAKES SUCH WAIVER VOLUNTARILY, AND (IV) IT HAS BEEN
INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE
MUTUAL WAIVERS AND CERTIFICATIONS IN PARAGRAPH.
27. Successors and
Assigns. The provisions of this Guarantee will be binding
upon and inure to the benefit of the Guaranteed Parties and will be
binding upon the Guarantor and its successors. This Guarantee may
not be assigned by the Guarantor or the Guaranteed Parties without
the prior written consent of the other.
28. Severability.
Wherever possible, any provision in this Guarantee which is held
invalid or unenforceable by a court of competent jurisdiction from
which no further appeal has or is taken shall, as to such
jurisdiction, be ineffective only to the extent of such prohibition
or unenforceability without invalidating the remaining provisions
of this Guarantee, and any such invalidity or unenforceability in
any one jurisdiction shall not invalidate or render unenforceable
such provision in any other jurisdiction.
29. Notice. All
notices, requests, claims, demands and other communications
hereunder shall be given (and shall be deemed to have been duly
given upon receipt) by hand delivery, by prepaid overnight courier
(providing written proof of delivery), by transmission-mail (with
confirmation of transmission other than by means of an
automatically- generated reply) or by certified or registered mail
(return receipt requested and first class postage prepaid),
addressed as follows (or at such other address for a party as shall
be specified by like notice):
If to the Guaranteed
Parties:
780 Third Avenue
37th
Floor
New York, NY
10017
Fax: (212)
573-8111
Email:
Attention: James E.
Flynn, Peter Steelman, David J. Clark
with a copy to
(which shall not constitute notice):
Robinson, Bradshaw
& Hinson, P.A.
101 North Tryon
Street, Suite 1900
Charlotte, NC
28246
Fax: (704)
339-3428
Email:
mhenry@robinsonbradshaw.com
Attention: Mark O.
Henry
If to the
Guarantor:
540 Gaither Road,
Suite 400,
Rockville, Maryland
20850
Attention: Joe
Miller
Email:
jmiller@cerecor.com
with a copy to
(which shall not constitute notice):
Wyrick Robbins
Yates & Ponton LLP
4101 Lake Boone
Trail, Suite 300
Raleigh, North
Carolina 27607
Attention: Don
Reynolds
Email:
dreynolds@wyrick.com
provided that any notice
received at the addressee’s location on any business day
after 5:00 p.m. (addressee’s local time) shall be deemed to
have been received at 9:00 a.m. (addressee’s local time) on
the next business day.
30. Amendment.
No term or provision of this Guarantee shall be amended, modified,
altered, waived or supplemented except in a writing signed by
Guarantor and the Guaranteed Parties.
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remainder of this page has been intentionally left
blank.]
THIS GUARANTEE executed effective
the date first written
above.
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Cerecor
Inc.
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By:
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Name
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Title
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Cerecor
Inc.
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By:
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Name:Title:
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Acknowledged and
accepted:
Deerfield
CSF, LLC
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By:
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Name:
Title:
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__________________________
Peter
Steelman
__________________________
James
Flynn
Exhibit
B
Escrow
Agreement
ESCROW AGREEMENT
THIS ESCROW
AGREEMENT (this “Agreement”) is entered into as of
November 1, 2019, by and among Armistice Capital Master Fund LTD
(“Armistice”), James Flynn, Peter Steelman and
Deerfield CSF, LLC (collectively, “Deerfield”, and
together with Armistice, sometimes referred to individually as
“Party” and collectively as the
“Parties”), and JPMorgan Chase Bank, N.A.
(“Escrow Agent”).
WHEREAS, the Parties have agreed to
deposit in escrow certain funds and wish such deposit to be subject
to the terms and conditions set forth herein.
1.
Appointment. The Parties hereby appoint
Escrow Agent as their escrow agent for the purposes set forth
herein, and Escrow Agent hereby accepts such appointment under the
terms and conditions set forth herein.
2.
Fund; Investment. (a) Armistice agrees
to deposit with
Escrow Agent the sum of $15,000,000 (the “Escrow
Deposit”). Escrow Agent shall hold the Escrow Deposit in one
or more demand deposit accounts un-invested (the
“Fund”) in a non-interest bearing account at
JPMorgan Chase Bank, N.A.
(b) Escrow Agent will not provide supervision,
recommendations or advice relating to either the investment of
moneys held in the Fund or the purchase, sale, retention or other
disposition of any investment described herein, and each Party
acknowledges that it was not offered any investment, tax or
accounting advice or recommendation by Escrow Agent with regard to
any investment and has made an independent assessment of the
suitability and appropriateness of any investment selected
hereunder for purposes of this Agreement. Escrow Agent shall
not have any liability for any loss sustained as a result of any
investment made pursuant to the terms of this Agreement or as a
result of any liquidation of any investment prior to its maturity
or for the failure of an Authorized Representative of the Parties
to give Escrow Agent instructions to
invest or reinvest the Fund. Escrow Agent shall have the right to
liquidate any investments held in order to provide funds necessary
to make required payments under this
Agreement.
(c) [RESERVED].
3.
Disposition and Termination.
(a) Escrow Agent
shall immediately release the Fund, and in any event within one (1)
Business Day, upon receipt of and in accordance with written
instructions from an Authorized Representative of both Deerfield
and Armistice in the form of Exhibit A-1 annexed hereto (a
“Joint Written Instruction”). Alternatively,
upon receipt by the Escrow Agent of a Final Determination expressly
stating that such Party is owed all or a part of the Fund, then
Escrow Agent shall, and is hereby authorized and directed to,
disburse the money from the Fund in accordance with such Final
Determination. For purposes of this
Escrow Agreement, “Final Determination” means a final non-appealable order,
decision, judgment or award of any court of competent jurisdiction
or arbitrator, together with (i) a certificate from counsel of the
prevailing Party attesting to the effect that such order, decision,
judgment or award is final and non-appealable and from a court of
competent jurisdiction or arbitrator having proper authority and
(ii) a written
instruction from an Authorized Representative of the instructing
Party given to effectuate such order, decision, judgment or award.
Escrow Agent shall be
entitled to conclusively rely upon any such certification and
instruction and shall have no responsibility to review the
order, decision, judgment or
award to which
such certification and instruction refers or to make any
determination as to whether such order, decision, judgment or award
is
final.
(b) Notwithstanding anything to the contrary set
forth in Section 8, any instructions setting forth, claiming,
containing, objecting to, or in any way related to the transfer or
distribution of the Fund, must be in writing and executed by
the appropriate Party or Parties as evidenced by the signatures of
the person or persons signing this Agreement or one of the
designated persons as set forth on the Designation of Authorized
Representatives attached hereto as Schedule 1-A and 1-B (each an
“Authorized Representative”), and delivered to Escrow
Agent only by confirmed facsimile or as a Portable Document Format
(“PDF”) attached to an email only at the fax number or
email address set forth in Section 8 below. Each Designation of
Authorized Representatives shall be signed by a Secretary, any
Assistant Secretary or other duly authorized person of the named
Party. No instruction for or related to the transfer or
distribution of the Fund shall be deemed delivered and effective
unless Escrow Agent actually shall have received it by facsimile or
as a PDF attached to an email only at the fax number or email
address set forth in Section 8 and in the case of a facsimile, as
evidenced by a confirmed transmittal to the Party’s or
Parties’ transmitting fax number. Escrow Agent shall not be
liable to any Party or other person for refraining from acting upon
any instruction for or related to the transfer or distribution of the Fund if delivered to any
other fax number or email address, including but not limited to a
valid email address of any employee of Escrow Agent.
Notwithstanding anything to the contrary, the Parties acknowledge
and agree that Escrow Agent (i) shall have no obligation to take
any action in connection with this Agreement on a non-Business Day
and any action Escrow Agent may otherwise be required to perform on
a non-Business Day may be performed by Escrow Agent on the
following Business Day and (ii) may not transfer or distribute the
Fund until Escrow Agent has completed its security
procedures.
(c) Each Party authorizes Escrow Agent to
use the funds transfer instructions (“Initial Standing
Instructions”) specified for it below to disburse any funds
due to such Party, without a verifying call-back or email
confirmation as set forth below:
(d)
In the event any funds transfer instructions other than the Initial
Standing Instructions are set forth in a permitted instruction from
a Party or the Parties in accordance with this Agreement (any such
additional funds transfer instructions, “Additional Standing
Instructions” and, together with the Initial Standing
Instructions, the “Standing Instructions”), Escrow
Agent will confirm such Additional Standing Instructions by a
telephone call-back or email confirmation to an Authorized
Representative of such Party or Parties, and Escrow Agent may rely
and act upon the confirmation of anyone purporting to be that
Authorized Representative. No funds will be disbursed until such
confirmation occurs. Each Party agrees that after such
confirmation, Escrow Agent may continue to rely solely upon such
Additional Standing Instructions and all identifying information
set forth therein for such beneficiary without an additional
telephone call-back or email confirmation. Further, it is
understood and agreed that if multiple disbursements are provided
for under this Agreement pursuant to any Standing Instructions,
only the date, amount and/or description of payments may change
without requiring a telephone call-back or email
confirmation.
(e)
The persons designated as Authorized Representatives and telephone
numbers for same may be changed only in a writing executed by an
Authorized Representative or other duly authorized person of the
applicable Party setting forth such changes and actually received
by Escrow Agent via facsimile or as a PDF attached to an email.
Escrow Agent will confirm any such change in Authorized
Representatives by a telephone call-back or email confirmation to
an Authorized Representative and Escrow Agent may rely and act upon
the confirmation of anyone purporting to be that Authorized
Representative.
(f)
Escrow Agent, any intermediary bank and the beneficiary's bank in
any funds transfer may rely upon the identifying number of the
beneficiary’s bank or any intermediary bank included in a
funds transfer instruction provided by a Party or the Parties and,
if applicable, confirmed in accordance with this Agreement.
Further, the beneficiary’s bank in the funds transfer
instructions may make payment on the basis of the account number
provided in such Party’s or the Parties’ instruction
and, if applicable, confirmed in accordance with this Agreement
even though it identifies a person different from the named
beneficiary.
(g)
As used in this Section 3, “Business Day” shall mean
any day other than a Saturday, Sunday or any other day on which
Escrow Agent located at the notice address set forth below is
authorized or required by law or executive order to remain closed.
The Parties acknowledge that the security procedures set forth in
this Section 3 are commercially reasonable. Upon delivery of the
Fund in full by Escrow Agent pursuant to this Section 3, this
Agreement shall terminate, and all the related account(s) shall be
closed, subject to the provisions of Sections 6 and
7.
(h) Notwithstanding anything to the contrary
contained in this Agreement, in the event that an electronic
signature is affixed to an instruction issued hereunder to disburse
or transfer funds, such instruction shall be confirmed by a
verifying call-back (or email confirmation) to an Authorized
Representative.
4.
Escrow Agent. Escrow Agent shall have only those duties as are
specifically and expressly provided herein, which shall be deemed
purely ministerial in nature, and no other duties, including but
not limited to any fiduciary duty, shall be implied.
Notwithstanding anything to the contrary, Escrow Agent has no
knowledge of, nor any obligation to comply with, the terms and
conditions of any other agreement, Escrow Agent shall not be
responsible for determining the meaning of any capitalized term not
entirely defined herein, nor shall Escrow Agent be required
to determine if any Party has complied with any other agreement.
Notwithstanding the terms
of any other agreement, the terms and
conditions of this Agreement shall control the actions of Escrow
Agent. Escrow Agent may conclusively rely upon any
written notice, document, instruction or request delivered by the
Parties believed by it to be genuine and to have been signed by an
Authorized Representative(s), as applicable, without inquiry and
without requiring substantiating evidence of any kind and Escrow
Agent shall be under no duty to inquire into or investigate the
validity, accuracy or content of any such document, notice,
instruction or request. Any notice, document, instruction or
request delivered by a Party but not required under this Agreement
may be disregarded by Escrow Agent. Escrow Agent shall not be
liable for any action taken, suffered or omitted to be taken by it
in good faith except to the extent that Escrow Agent's gross
negligence or willful misconduct was the cause of any direct
loss to either Party. Escrow
Agent may execute any of its powers and perform any of its duties
hereunder directly or through affiliates or agents. In the event
Escrow Agent shall be uncertain, or believes there is some
ambiguity, as to its duties or rights hereunder or receives
instructions, claims or demands from any Party hereto which in
Escrow Agent’s judgment conflict with the provisions of this
Agreement, or if Escrow Agent receives conflicting instructions
from the Parties, Escrow Agent shall be entitled either to: (a)
refrain from taking any action until it shall be given (i) a joint
written direction executed by Authorized Representatives of the
Parties which
eliminates such ambiguity or conflict or (ii) a court order issued
by a court of competent jurisdiction (it being understood that
Escrow Agent shall be entitled conclusively to rely and act upon
any such court order and shall have no obligation to determine
whether any such court order is final); or (b) file an action in
interpleader. Escrow Agent shall have no duty to solicit any
payments which may be due it or the Fund, including, without
limitation, the Escrow Deposit nor shall Escrow Agent have any
duty or obligation to confirm or
verify the accuracy or correctness of any amounts deposited with it
hereunder. The Parties grant to Escrow Agent a lien and
security interest in the Fund in order to secure any
indemnification obligations of the Parties or obligation for fees
or expenses owed to Escrow Agent hereunder. Anything in this Agreement to the contrary
notwithstanding, in no event shall Escrow Agent be liable for
special, incidental, punitive, indirect or consequential loss or
damage of any kind whatsoever (including but not limited to lost
profits), even if Escrow Agent has been advised of the likelihood
of such loss or damage and regardless of the form of
action.
5.
Succession. Escrow Agent may resign and be discharged from its
duties or obligations hereunder by giving no less than thirty
(30) days advance notice in
writing of such resignation to the Parties or may be removed, with
or without cause, by the Parties at any time after giving not less than thirty (30)
days advance joint written
notice to Escrow Agent. Escrow Agent’s sole responsibility
after such thirty (30) day notice period expires shall be to hold
the Fund and to deliver the same to a designated substitute escrow
agent, if any, appointed by the Parties, or such other person
designated by the Parties, or in accordance with the directions of
a final court order, at which time of delivery, Escrow
Agent’s obligations hereunder shall cease and terminate. If
prior to the effective resignation or removal date, the Parties
have failed to appoint a successor escrow agent, or to instruct
Escrow Agent to deliver the Fund to another person as provided
above, or if such delivery is contrary to applicable law, at any
time on or after the effective resignation date, Escrow Agent may
either (a) interplead the Fund with a court located in the
State of New York and the costs, expenses and reasonable
attorney’s fees which are incurred in connection with such
proceeding may be charged against and
withdrawn from the Fund; or (b) appoint a successor escrow agent of
its own choice. Any appointment of a successor escrow agent shall
be binding upon the Parties and no appointed successor escrow agent
shall be deemed to be an agent of Escrow Agent. Escrow Agent shall
deliver the Fund to any appointed successor escrow agent, at which
time Escrow Agent’s obligations under this Agreement shall
cease and terminate. Any entity into which Escrow Agent may be
merged or converted or with which it may be consolidated, or any
entity to which all or substantially all the escrow business may be
transferred, shall be Escrow Agent under this Agreement without
further act.
6.
Compensation;
Acknowledgment. (a) The Parties agree jointly and severally to pay
Escrow Agent upon execution of this Agreement and from time to time
thereafter reasonable compensation for the services to be rendered
hereunder, which unless otherwise agreed in writing, shall be as
described in Schedule 2.
(b)
Each of the Parties further agrees to the disclosures and
agreements set forth in Schedule 2.
7.
Indemnification
and Reimbursement.
The Parties agree jointly and
severally to indemnify, defend, hold harmless, pay or reimburse
Escrow Agent and its affiliates and their respective successors,
assigns, directors, agents and employees (the
“Indemnitees”) from and against any and all losses,
damages, claims, liabilities, costs or expenses (including
attorney’s fees) (collectively “Losses”),
resulting directly or indirectly from (a) Escrow Agent’s
performance of this Agreement, except to the extent that such
Losses are determined by a court of competent jurisdiction to have
been caused by the gross negligence, willful misconduct, or bad
faith of such Indemnitee; and (b) Escrow Agent’s following,
accepting or acting upon any instructions or directions, whether
joint or singular, from the Parties received in accordance with
this Agreement. The Parties hereby grant Escrow Agent a right of
set-off against the Fund for the payment of any claim for
indemnification, fees, expenses and amounts due to Escrow Agent or
an Indemnitee. The
obligations set forth in this Section 7 shall survive the
resignation, replacement or removal of Escrow Agent or the
termination of this Agreement.
8.
Notices. Except as otherwise provided in Section 3, all
communications hereunder shall be in writing or set forth in
a PDF attached to an email, and shall
be delivered by facsimile,
email or overnight
courier only to the appropriate
fax number, email address, or notice address set forth for each
Party as follows:
If to Armistice:
510 Madison Avenue; 7th
Floor
New
York, NY 10022
Attention:
Anthony Cardone
Tel No.: (212)
231-4932
Email Address:
acordone@armisticecapital.com
Account
statements and
billing: [Insert address
if different from above]
With copies
to:
(street
address)
(City, state [country], zip [postal code])
Attention:
Tel
No.:
Fax
No.:
Email
Address:
If to
Deerfield:
780 Third Ave. 37th
Fl
New
York, NY 10017
Attention:
Elliot Press
Tel No.: (212)
583-7290
Email Address:
epress@deerfield.com
If to Escrow Agent:
JPMorgan Chase Bank, N.A.
Escrow
Services
4
New York Plaza, Floor 11
New York, NY
10004
Attention: Renfred
Pico / Donna Fitzsimmons
Fax No.:
212-552-2812
Email Address: ec.escrow@jpmorgan.com
9.
Compliance with
Directives. In the event that a
legal garnishment, attachment, levy, restraining notice, court
order or other governmental order (a “Directive”) is
served with respect to any of the Fund, or the delivery thereof
shall be stayed or enjoined by a Directive, Escrow Agent is hereby
expressly authorized, in its sole discretion, to obey and comply
with all such Directives so entered or issued, and in the event
that Escrow Agent obeys or complies with any such Directive it
shall not be liable to any of the Parties hereto or to any other
person by reason of such compliance notwithstanding such Directive
be subsequently reversed, modified, annulled, set aside or
vacated.
10.
Miscellaneous.
(a) The provisions of this Agreement may be waived,
altered, amended or supplemented only by a writing signed by Escrow
Agent and the Parties. Neither this Agreement nor any right or
interest hereunder may be assigned by any Party without the prior
consent of Escrow Agent and the other Party and any assignment in
violation of this Agreement shall be ineffective and void. This
Agreement shall be governed by and construed under the laws of the
State of New York. Each Party and Escrow Agent 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. To the extent that
in any jurisdiction either Party may now or hereafter be entitled
to claim for itself or its assets, immunity from suit, execution,
attachment (before or after judgment) or other legal process or
immunity from liability, such Party shall not claim, and hereby
irrevocably waives, such immunity. Escrow Agent and the Parties
further hereby waive any right to a trial by jury with respect to
any lawsuit or judicial proceeding arising or relating to this
Agreement.
(b) No party to this Agreement is liable to any
other party for losses due to, or if it is unable to perform its
obligations under the terms of this Agreement because of, acts of
God, fire, war, terrorism, floods, strikes, electrical outages,
equipment or transmission failure, or other causes reasonably
beyond its control. This Agreement and any joint instructions from
the Parties may be executed in one or more counterparts, each of
which shall be deemed an original, but all of which together shall
constitute one and the same instrument or instruction, as
applicable. This Agreement may be executed and transmitted by
facsimile or as a PDF attached to an email and each such execution
shall be of the same legal effect, validity and enforceability as a
manually executed original, wet-inked signature. All signatures of
the parties to this Agreement may be transmitted by facsimile or as
a PDF attached to an email, 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 each represent,
warrant and covenant that (i) each document, notice, instruction or
request provided by such Party to Escrow Agent shall comply with
applicable laws and regulations; (ii) such Party has full power and
authority to enter into this Agreement and to perform all of the
duties and obligations to be performed by it hereunder; and (iii)
the person(s) executing this Agreement on such Party’s behalf
and certifying Authorized Representatives in the applicable
Schedule 1 has been duly and properly authorized to do so, and each
Authorized Representative of such Party has been duly and properly
authorized to take actions specified for such person in the
applicable Schedule 1. Except as expressly provided in Section 7
above, nothing in this Agreement, whether express or implied, shall
be construed to give to any person or entity other than Escrow
Agent and the Parties any legal or equitable right, remedy,
interest or claim under or in respect of the Fund or this
Agreement.
IN WITNESS
WHEREOF, the parties hereto
have executed this Agreement as of the date set forth
above.
ESCROW AGENT
ARMISTICE CAPITAL MASTER FUND LTD JPMORGAN CHASE BANK,
N.A.
|
By:
________________________
|
By:
________________________
|
|
Name:
________________________
|
Name: Christopher
Palermo
|
|
Title:
________________________
|
Title: Vice
President
|
DEERFIELD CSF, LLC
By: ___________________________
Name: ___________________________
Title: ___________________________
__________________________________
James
Flynn
__________________________________
Peter
Steelman
EXHIBIT
A-1
Form of Escrow Release Notice – Joint
Instructions
JPMorgan Chase
Bank, N.A., Escrow Services
[Address]
[Fax
No.]
[Email
Address]
Attention:
[_______]
Date:
Re: [Name of
Parties] – Escrow Agreement dated [ ]
Escrow Account no.
[ ]
Dear
Sir/Madam:
We refer to an
escrow agreement dated [ ] among [ ], [ ] and JPMorgan Chase Bank,
N.A., as Escrow Agent (the “Escrow
Agreement”).
Capitalized terms
in this letter that are not otherwise defined shall have the same
meaning given to them in the Escrow Agreement.
Pursuant to Section
[__] of the Escrow Agreement, [Armistice/Deerfield/the Parties]
instruct[s] Escrow Agent to release the Fund, or the portion
specified below, to the specified Party as instructed
below.
Amount
(In
writing)
Beneficiary
City
Country
US
Instructions:
Bank
Bank
address
ABA
Number:
Credit A/C
Name:
Credit A/C
#:
Credit A/C
Address:
If
Applicable:
FFC A/C
Name:
FFC A/C
#:
FFC A/C
Address:
International
Instructions:
Bank
Name:
Bank
Address
SWIFT
Code:
US Pay Through
ABA:
Credit A/C
Name:
Credit A/C # (IBAN
#):
Credit A/C
Address:
If
Applicable:
FFC A/C
Name:
FFC A/C # (IBAN
#):
FFC A/C
Address:
ARMISTICE:
______________________
By:
__________________________
Name:
Title:
Date:
DEERFIELD:
______________________
By: _________________________________
Name:
Title:
Date:
Schedule
1-A
Armistice Capital
Master Fund LTD
DESIGNATION
OF AUTHORIZED
REPRESENTATIVES
The undersigned,
_[______________]___, being the duly elected, qualified and acting
_[______________]___ of Armistice Capital Master Fund LTD
(“Armistice”), does hereby certify:
1. That each of the
following representatives is at the date hereof an Authorized
Representative, as such term is defined in the Escrow Agreement,
dated October [__], 2019, by and among Armistice, Deerfield and
Escrow Agent (the “Escrow Agreement”), that the
signature appearing opposite each Authorized Representative’s
name is the true and genuine signature of such Authorized
Representative, and that each Authorized Representative’s
contact information is current and up-to-date at the date hereof.
Each of the Authorized Representatives is authorized to issue
instructions, confirm funds transfer instructions by callback or
email confirmation and effect changes in Authorized
Representatives, all in accordance with the terms of the Escrow
Agreement. Callbacks or emails
confirming an instruction shall be made to an Authorized
Representative other than the Authorized Representative who issued
the instruction unless (a) only a single Authorized Representative
is designated below, (b) the information set forth below changes
and is not updated by Armistice such that only the Authorized
Representative who issued the instruction is available to receive a
callback or email confirmation, or (c) Armistice is an individual.
Armistice acknowledges that pursuant to this Schedule, Escrow Agent
is offering an option for callback or email confirmation to a
different Authorized Representative, and if Armistice nevertheless
names only a single Authorized Representative or fails to update
Authorized Representative information, Armistice agrees to be bound
by any instruction, whether or not authorized, confirmed by
callback or email confirmation to the issuer of the
instruction.
|
NAME
|
SIGNATURE
|
TELEPHONE, CELL
NUMBER and EMAIL ADDRESS
|
|
Stephen
Boyd
|
____________________________
|
(ph)__________________________
(cell)_________________________
(email)SBoyd@armisticecapital.com
|
|
____________________________
|
____________________________
|
(ph)__________________________
(cell)_________________________
(email)________________________
|
|
|
|
|
|
|
|
|
2.
Email confirmation
is only permitted to a corporate email address for purposes of this
Schedule. Any personal email addresses provided will not be used
for email confirmation.
3.
This
Schedule may be signed in counterparts and the undersigned
certifies that any signature set forth on an attachment to this
Schedule is the true and genuine signature of an Authorized
Representative and that each such Authorized Representative’s
contact information is current and up-to-date at the date
hereof.
4.
That pursuant to
Armistice’s governing documents, as amended, the undersigned
has the power and authority to execute this Designation on behalf
of Armistice, and that the undersigned has so executed this
Designation this _[____]_ day of October, 2019.
5.
Notwithstanding
the above, if Armistice is an individual, no signature will be
required below.
|
|
Signature:
_____________________________
|
|
Name:
_____________________________
|
|
|
Title:
_____________________________
|
FOR YOUR SECURITY, PLEASE CROSS OUT ALL UNUSED SIGNATURE LINES ON
THIS SCHEDULE 1-A
All instructions, including but not limited to
funds transfer instructions, whether transmitted by
facsimile or set forth in a PDF attached to an email, must include the signature (or electronic
signature subject to the conditions set forth in the Escrow
Agreement) of the Authorized Representative authorizing said funds
transfer on behalf of such Party.
Schedule
1-B
DEERFIELD
DESIGNATION
OF AUTHORIZED
REPRESENTATIVES
The undersigned
does hereby certify:
1.
That each of the
following representatives is at the date hereof an Authorized
Representative, as such term is defined in the Escrow Agreement,
dated ________________, 20__, by and among Armistice, Deerfield and
Escrow Agent (the “Escrow Agreement”), that the
signature appearing opposite each Authorized Representative’s
name is the true and genuine signature of such Authorized
Representative, and that each Authorized Representative’s
contact information is current and up-to-date at the date hereof.
Each of the Authorized Representatives is authorized to issue
instructions, confirm funds transfer instructions by callback or
email confirmation and effect changes in Authorized
Representatives, all in accordance with the terms of the Escrow
Agreement. Callbacks or emails
confirming an instruction shall be made to an Authorized
Representative other than the Authorized Representative who issued
the instruction unless (a) only a single Authorized Representative
is designated below, (b) the information set forth below changes
and is not updated by Deerfield such that only the Authorized
Representative who issued the instruction is available to receive a
callback or email confirmation, or (c) Deerfield is an individual.
Deerfield acknowledges that pursuant to this Schedule, Escrow Agent
is offering an option for callback or email confirmation to a
different Authorized Representative, and if Deerfield nevertheless
names only a single Authorized Representative or fails to update
Authorized Representative information, Deerfield agrees to be bound
by any instruction, whether or not authorized, confirmed by
callback or email confirmation to the issuer of the
instruction.
|
NAME
|
SIGNATURE
|
TELEPHONE, CELL
NUMBER and EMAIL ADDRESS
|
|
James
Flynn
|
____________________________
|
(ph)__________________________
(cell)_________________________
(email)________________________
|
|
____________________________
|
____________________________
|
(ph)__________________________
(cell)_________________________
(email)________________________
|
|
____________________________
|
____________________________
|
(ph)__________________________
(cell)_________________________
(email)________________________
|
|
|
|
|
|
|
|
|
2.
Email confirmation
is only permitted to a corporate email address for purposes of this
Schedule. Any personal email addresses provided will not be used
for email confirmation.
3.
This
Schedule may be signed in counterparts and the undersigned
certifies that any signature set forth on an attachment to this
Schedule is the true and genuine signature of an Authorized
Representative and that each such Authorized Representative’s
contact information is current and up-to-date at the date
hereof.
4.
That pursuant to
Deerfield’s governing documents, as amended, the undersigned
has the power and authority to execute this Designation on behalf
of Deerfield, and that the undersigned has so executed this
Designation this _____ day of ______, 20__.
5.
Notwithstanding
the above, if Deerfield is an individual, no signature will be
required below.
|
|
Signature:
_____________________________
|
|
Name:
_____________________________
|
|
|
Title:
_____________________________
|
FOR YOUR SECURITY, PLEASE CROSS OUT ALL UNUSED SIGNATURE LINES ON
THIS SCHEDULE 1-B
All instructions, including but not limited to
funds transfer instructions, whether transmitted by
facsimile or set forth in a PDF attached to an email, must include the signature (or electronic
signature subject to the conditions set forth in the Escrow
Agreement) of the Authorized Representative authorizing said funds
transfer on behalf of such Party.
SCHEDULE 2
Schedule of Fees and Disclosures for Escrow Agent
Services
Schedule of Fees
for Escrow Agent Services
Account Acceptance Fee . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . .
…...$
3,500.00
Encompassing
review, negotiation and execution of governing documentation,
opening of the account, and completion of all due diligence
documentation. Payable upon closing.
Annual Administration Fee . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . $ Waived.
The Administration
Fee covers our usual and customary ministerial duties, including
record keeping, distributions, document compliance and such other
duties and responsibilities expressly set forth in the governing
documents for each transaction. Payable upon closing and annually
in advance thereafter, without pro-ration for partial
years.
Extraordinary Services and Out-of-Pocket
Expenses: Escrow Agent or any of its affiliates may receive
compensation with respect to any investment directed hereunder
including without limitation charging any applicable agency fee or
trade execution fee in connection with each transaction. Any
additional services beyond our standard services as specified
above, and all reasonable out-of-pocket expenses including
attorney’s or accountant’s fees and expenses will be
considered extraordinary services for which related costs,
transaction charges, and additional fees will be billed at Escrow
Agent's then standard rate. Escrow Agent may impose, charge,
pass-through and modify fees and/or charges for any account
established and services provided by Escrow Agent, including but
not limited to, transaction, maintenance, balance-deficiency, and
service fees, agency or trade execution fees, and other charges,
including those levied by any governmental
authority.
Fee Disclosure & Assumptions: Please
note that the fees quoted are based on a review of the transaction
documents provided and an internal due diligence review, and
assumes the escrow deposit will be continuously invested in [a
MMDA][an interest bearing demand deposit account] at JPMorgan Chase
Bank, N.A. Escrow Agent reserves the right to revise, modify,
change and supplement the fees quoted herein if the assumptions
underlying the activity in the account, level of balances, market
volatility or other factors change from those used to set the fees
described herein.
Payment of the
invoice is due upon receipt.
Disclosures
and Agreements:
Taxes.
The Parties shall
duly complete such tax documentation or other procedural
formalities necessary for Escrow Agent to complete required tax
reporting and for the relevant Party to receive interest or other
income without withholding or deduction of tax in any jurisdiction.
Should any information supplied in such tax documentation change,
the Parties shall promptly notify Escrow Agent. Escrow Agent shall
withhold any taxes it deems appropriate in the absence of proper
tax documentation or as required by law, including without
limitation, the Foreign Account Tax Compliance Act
(“FATCA”), and shall remit such taxes to the
appropriate authorities.
Representations Relating to Section 15B of the
Securities Exchange Act of 1934 (Rule 15Ba1-1 et seq.) (the
“Municipal Advisor Rule”). Each Party represents and warrants to Escrow
Agent that for purposes of the Municipal Advisor Rules,
none of the funds
(if any) currently invested, or that will be invested in the
future, in money market funds, commercial paper or treasury bills
under this Agreement constitute or contain (i) proceeds of
municipal securities (including investment income therefrom and
monies pledged or otherwise legally dedicated to serve as
collateral or a source or repayment for such securities) or (ii)
municipal escrow investments (as each such term is defined in the
Municipal Advisor Rule). Each Party also represents and
warrants to Escrow Agent that the person providing this
certification has access to the appropriate information or has
direct knowledge of the source of the funds to be invested to
enable the forgoing representation to be made. Further, each
Party acknowledges that Escrow Agent will rely on this
representation until notified in writing
otherwise.
Know Your Customer. To assist in the
prevention of the funding of terrorism and money laundering
activities, applicable law may require financial institutions to
obtain, verify, and record information that identifies each person
who opens an account. What this means for the Parties: when the
Parties open an account, Escrow Agent may ask for each
Party’s name, address, date of birth (for natural persons),
and/or other information and documents that will allow Escrow Agent
to identify such Party. Escrow Agent may also request and obtain
certain information from third party vendors regarding any Party.
To fulfill Escrow Agent’s “know your customer”
responsibilities and in connection with its performance of this
Agreement, Escrow Agent may request information and/or
documentation from each Party from time to time, including, without
limitation, regarding such Party’s organization, business
and, to the extent applicable, beneficial owner(s) of such Party,
including relevant natural or legal persons, and such Party shall
procure and furnish the same to Escrow Agent in a timely manner.
Any information and/or documentation furnished by any Party is the
sole responsibility of such Party and Escrow Agent is entitled to
rely on the information and/or documentation without making any
verification whatsoever (except for the authentication under the
security procedures, as applicable). Each Party represents and
warrants that all such information and/or documentation is true,
correct and not misleading and shall advise Escrow Agent promptly
of any changes and, except as prohibited by applicable law, such
Party agrees to provide complete responses to Escrow Agent’s
requests within the timeframes specified. If any Party fails to
provide or consent to the provision of any information required by
this paragraph, Escrow Agent may suspend or discontinue providing
any service hereunder and resign pursuant to this
Agreement.
OFAC
Disclosure. Escrow Agent is
required to act in accordance with the laws and regulations of
various jurisdictions relating to the prevention of money
laundering and the implementation of sanctions, including but not
limited to regulations issued by the U.S. Office of Foreign Assets
Control. Escrow Agent is not obligated to execute payment orders or
effect any other transaction where the beneficiary or other payee
is a person or entity with whom Escrow Agent is prohibited from
doing business by any law or regulation applicable to Escrow Agent,
or in any case where compliance would, in Escrow Agent’s
opinion, conflict with applicable law or banking practice or its
own policies and procedures. Where Escrow Agent does not execute a
payment order or effect a transaction for such reasons, Escrow
Agent may take any action required by any law or regulation
applicable to Escrow Agent including, without limitation, freezing
or blocking funds. Transaction screening may result in delays in
the posting of transactions.
Abandoned
Property. Escrow Agent is
required to act in accordance with the laws and regulations of
various states relating to abandoned property, escheatment or
similar law and, accordingly, shall be entitled to remit dormant
funds to any state as abandoned property in accordance with such
laws and regulations. Without limitation of the foregoing,
notwithstandingany instruction to the contrary, Escrow Agent shall
not be liable to any Party for any amount disbursed from an account
maintained under this Agreement to a governmental entity or public
official in compliance with any applicable abandoned property,
escheatment or similar law.
Information. The Parties
authorize Escrow Agent to disclose information with respect to this
Agreement and the account(s) established hereunder, the Parties, or
any transaction hereunder if such disclosure is: (i) necessary in
Escrow Agent’s opinion, for the purpose of allowing Escrow
Agent to perform its duties and to exercise its powers and rights
hereunder or for operational or risk management purposes or
compliance with legal, tax and regulatory requirements, including,
without limitation, FATCA; (ii) to a proposed assignee of the
rights of Escrow Agent; (iii) to a branch, affiliate, subsidiary,
employee or agent of Escrow Agent or to their auditors, regulators
or legal advisers or to any competent court; (iv) to the auditors
of any of the Parties; or (v) required by applicable law,
regardless of whether the disclosure is made in the country in
which each Party resides, in which the Escrow Account is
maintained, or in which the transaction is conducted. The Parties
agree that such disclosures by Escrow Agent and its affiliates may
be transmitted across national boundaries and through networks,
including those owned by third parties.
Foreign Exchange. If Escrow Agent
accepts a funds transfer instruction under this Agreement for
payment in a currency (the “Non-Account Currency”)
other than the currency of the account (the “Account
Currency”), Escrow Agent is authorized to enter into a
foreign exchange transaction to sell to the Party or Parties the
amount of Non-Account Currency required to complete the funds
transfer and debit the account for the purchase price of the
Non-Account Currency. If Escrow Agent receives a payment to the
account in a Non-Account Currency, Escrow Agent is authorized to
purchase the Non-Account Currency from the Party or Parties, and to
credit the purchase price to the account in lieu of the Non-Account
Currency. The applicable foreign exchange rate and spread for any
of the foregoing transactions shall be determined by Escrow Agent
in its sole discretion and may differ from foreign exchange rates
and spreads at which comparable transactions are entered into with
other customers or the range of foreign exchange rates or spreads
at which Escrow Agent otherwise enters into foreign exchange
transactions on the relevant date. Escrow Agent may generate
additional profit or loss in connection with Escrow Agent’s
execution of a foreign exchange transaction or management of its
risk related thereto in addition to the applicable spread. Further,
(i) Escrow Agent has full discretion to execute such foreign
exchange transactions in such manner as Escrow Agent determines in
its sole discretion and (ii) Escrow Agent may manage the associated
risks of Escrow Agent’s own position in the market in a
manner it deems appropriate without regard to the impact of such
activities on the Parties. Any such foreign exchange transaction
will be between Escrow Agent and a Party or Parties as principals,
and Escrow Agent will not be acting as agent or fiduciary for the
Parties.
Acknowledgment of Compensation
and Multiple Roles. Escrow Agent is authorized to act
under this
Agreement notwithstanding that Escrow Agent or any
of its subsidiaries
or affiliates (such subsidiaries and affiliates hereafter
individually called an “Affiliate” and collectively
called “Affiliates”) may (A) receive fees or derive
earnings (float) as a result of providing an investment product
oraccount on the books of Escrow Agentpursuant to this Agreement
orfor providing services or referralswith respect
to investment products, or (B)
(i) act in
the same transaction in multiple capacities, (ii) engage in other
transactions or relationshipswith the same entities to which
Escrow Agent may be providing escrow or other services under this
Agreement,
(iii) refer clients to an Affiliate for services or (iv) enter into agreements
under which referrals of escrow or related transactions are
provided to Escrow Agent. JPMorgan Chase Bank, N.A. may
earncompensation from any of theseactivities in
addition to the fees charged for services under this
Agreement.
FDIC Disclosure. In the
event Escrow Agent becomes insolvent or enters into receivership,
Escrow Agent may provide to the Federal Deposit Insurance
Corporation (“FDIC”) account balance information for
any account governed by this Agreement, as reflected on Escrow
Agent’s end-of-day ledger balance, and the customer name and
tax identification number associated with such accounts for the
purposes of determining the appropriate deposit insurance
coverage. Funds held in such accounts will be insured by the
FDIC under its applicable rules and limits.
THE FOLLOWING DISCLOSURES ARE REQUIRED TO BE PROVIDED UNDER
APPLICABLE U.S. REGULATIONS, INCLUDING, BUT NOT LIMITED TO, FEDERAL
RESERVE REGULATION D. WHERE SPECIFIC INVESTMENTS ARE NOTED BELOW,
THE DISCLOSURES APPLY ONLY TO THOSE INVESTMENTS AND NOT TO ANY
OTHER INVESTMENT.
Demand Deposit Account
Disclosure. Escrow Agent
is authorized, for regulatory reporting and internal accounting
purposes, to divide an escrow demand deposit account maintained in
the U.S. in which the Fund is held into a non-interest bearing
demand deposit internal account and a non-interest bearing savings
internal account, and to transfer funds on a daily basis between
these internal accounts on Escrow Agent’s general ledger in
accordance with U.S. law at no cost to the Parties. Escrow Agent
will record the internal accounts and any transfers between them on
Escrow Agent’s books and records only. The internal accounts
and any transfers between them will not affect the Fund, any
investment or disposition of the Fund, use of the escrow demand
deposit account or any other activities under this Agreement,
except as described herein. Escrow Agent will establish a target
balance for the demand deposit internal account, which may change
at any time. To the extent funds in the demand deposit
internal account exceed the target balance, the excess will be
transferred to the savings internal account, unless the maximum
number of transfers from the savings internal account for that
calendar month or statement cycle has already occurred. If
withdrawals from the demand deposit internal account exceeds the
available balance in the demand deposit internal account, funds
from the savings internal account will be transferred to the demand
deposit internal account up to the entire balance of available
funds in the savings internal account to cover the shortfall and to
replenish any target balance that Escrow Agent has established for
the demand deposit internal account. If a sixth transfer
is needed during a calendar month or statement cycle, it will be
for the entire balance in the savings internal account, and such
funds will remain in the demand deposit internal account for the
remainder of the calendar month or statement
cycle.
MMDA Disclosure and Agreement. If MMDA
is the investment for the escrow deposit as set forth above or
anytime in the future, the Parties acknowledge and agree that U.S.
law limits the number of pre-authorized or automatic transfers or
withdrawals or telephonic/electronic instructions that can be made
from an MMDA to a total of six (6) per calendar month or statement
cycle or similar period. Escrow Agent is required by U.S. law to
reserve the right to require at least seven (7) days’ notice
prior to a withdrawal from a money market deposit
account.
Unlawful Internet Gambling. The use of
any account to conduct transactions (including, without limitation,
the acceptance or receipt of funds through an electronic funds
transfer, or by check, draft or similar instrument, or the proceeds
of any of the foregoing) that are related, directly or indirectly,
to unlawful Internet gambling is strictly
prohibited.
Recordings. Each Party and Escrow
Agent consent to the other party or parties making and retaining
recordings of telephone conversations between any Party or Parties
on one hand and Escrow Agent on the other hand in connection with
Escrow Agent’s security procedures.
Use of Electronic Records and Signatures. As used in this
Agreement, the terms “writing” and
“written” include electronic records, and the terms
“execute”, “signed” and
“signature” include the use of electronic signatures.
Notwithstanding any other provision of this Agreement or the
attached Exhibits and Schedules, any electronic signature that is
presented as the signature of the purported signer, regardless of
the appearance or form of such electronic signature, may be deemed
genuine by Escrow Agent in Escrow Agent’s sole discretion,
and such electronic signature shall be of the same legal effect,
validity and enforceability as a manually executed, original,
wet-inked signature; provided, however, that any such electronic
signature must be an actual and not a typed signature. Any
electronically signed agreement shall be an “electronic
record” established in the ordinary course of business and
any copy shall constitute an original for all purposes. The terms
“electronic signature” and “electronic
record” shall have the meanings ascribed to them in 15 USC
§ 7006. This Agreement and any instruction or other document
furnished hereunder may be transmitted by facsimile or as a PDF
file attached to an email.
Schedule I
Fixed Payments
33