TABLE OF CONTENTS

 

		Page
ARTICLE I Definitions; Interpretation		2
Section 1.1	Definitions	2
Section 1.2	Interpretation	10
ARTICLE II Purchase and Sale		11
Section 2.1	Purchase and Sale of Assets; Purchase Price	11
Section 2.2	Purchased Assets; Licensed Assets; Excluded Assets.	11
Section 2.3	Assumed Liabilities; Excluded Liabilities	13
Section 2.4	Closing	14
Section 2.5	Purchase Price Allocation	15
Section 2.6	Books and Records	15
Section 2.7	Privileges	15
ARTICLE III REPRESENTATIONS AND WARRANTIES OF SELLER		16
Section 3.1	Organization, Standing and Power	16
Section 3.2	Authority; Binding Agreements	16
Section 3.3	Conflicts	17
Section 3.4	Consents	17
Section 3.5	Seller Documents; Proxy Statement	18
Section 3.6	Good Title	18
Section 3.7	Intellectual Property	19
Section 3.8	Compliance with Applicable Law	20
Section 3.9	Litigation	20
Section 3.10	Insurance	21
Section 3.11	Taxes	21
Section 3.12	Brokers	21
Section 3.13	Regulatory Matters	22
Section 3.14	Solvency	22
Section 3.15	Novo Asset Purchase Agreement	22
Section 3.16	No Implied Warranty	23
ARTICLE IV Representations and Warranties of Buyer		23
Section 4.1	Organization, Standing and Power	23
Section 4.2	Authority; Binding Agreements	23

 

 

Section 4.3	Conflicts	23
Section 4.4	Consents	24
Section 4.5	Brokers	24
Section 4.6	Litigation	24
Section 4.7	Availability of Funds	24
Section 4.8	No Implied Warranty	24
ARTICLE V Additional Agreements		25
Section 5.1	Obligation to Consummate Transaction	25
Section 5.2	Confidentiality	25
Section 5.3	Access to Information	25
Section 5.4	Preparation of Proxy Statement; Stockholders Meeting	25
Section 5.5	Standstill Agreement	27
Section 5.6	Certain Tax Matters	28
Section 5.7	Public Announcements	29
Section 5.8	Cooperation in Patent Transfer and Assignment	29
Section 5.9	Technical Transition	29
Section 5.10	Termination of the Collaboration Agreement	30
Section 5.11	Further Assurances	30
Section 5.12	Acquisition Proposals	30
Section 5.13	Insurance	32
Section 5.14	Amendments to Novo Asset Purchase Agreement	33
Section 5.15	Notice of Certain Events	33
ARTICLE VI Conditions Precedent		34
Section 6.1	Conditions to Obligations of Buyer and Seller	34
Section 6.2	Conditions to Obligations of Buyer	34
Section 6.3	Conditions to Obligations of Seller	36
Section 6.4	Closing Deliverables	37
Section 6.5	Frustration of Closing Conditions	38
Section 6.6	Liquidation of Seller	38
ARTICLE VII TERMINATION		38
Section 7.1	Termination	38
Section 7.2	Procedure and Effect of Termination	39
ARTICLE VIII Miscellaneous		40
Section 8.1	Limitation on Liability of Seller	40

 

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Section 8.2	Non-Survival of Representations, Warranties and Agreements	41
Section 8.3	Governing Law; Jurisdiction; Venue; Service Of Process	41
Section 8.4	Notices	42
Section 8.5	Benefits of Agreement	43
Section 8.6	Amendments and Waivers	43
Section 8.7	Cumulative Rights	43
Section 8.8	Expenses	43
Section 8.9	Waiver of Jury Trial	43
Section 8.10	Assignment	44
Section 8.11	Enforceability; Severability	44
Section 8.12	Entire Agreement	44
Section 8.13	Counterparts	44
Section 8.14	Specific Performance	44

 

SCHEDULES TO ASSET PURCHASE AGREEMENT

 

Schedule 1.1(a)	Transferred Patent Rights
Schedule 1.1(b)(i)	Neose Retained Intellectual Property
Schedule 1.1(b)(ii)	Other Excluded Intellectual Property
Schedule 1.1(c)	Individuals with Seller’s Knowledge
Schedule 1.1(d)	Transferred Trademarks
Schedule 2.2(a)(vi)	Assumed Contracts
Schedule 2.2(b)	Transition Plan
Schedule 2.7	Privileged Documents and Opinions
Schedule 3.1	Affiliates
Schedule 3.3(b)	Conflicts
Schedule 3.4	Governmental Authority Consents
Schedule 3.5(d)	Certain Changes
Schedule 3.6	Certain Liens to Title
Schedule 3.7(a)	Registered Intellectual Property
Schedule 3.7(b)	Third Party License Agreements
Schedule 3.7(c)	Intellectual Property Infringement and Litigation
Schedule 3.7(d)	License Grants
Schedule 5.9	Technical Transition Employees
Schedule 6.4(b)(i)	Seller’s Wire Transfer Instructions

 

EXHIBITS TO ASSET PURCHASE AGREEMENT

 

Exhibit A	Form of Bill of Sale and Assignment and Assumption Agreement
Exhibit B	Form of BGX License Agreement
Exhibit C	Form of BGX Sublicense Agreement

 

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Exhibit D	Form of Patent Cooperation Agreement
Exhibit E	Form of Novo Assignment and Assumption Agreement
Exhibit F	Form of Mutual Release Agreement
Exhibit G	Form of Post-Closing Confidentiality Agreement

 

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ASSET PURCHASE AGREEMENT

 

This Asset Purchase Agreement (this “ Agreement ”), dated as of September 17, 2008, is made by and between Neose Technologies, Inc., a Delaware corporation (“ Seller ”), and BioGeneriX AG, a company organized under the laws of the Federal Republic of Germany (“ Buyer ”).

 

RECITALS

 

WHEREAS , Seller and Buyer are currently party to that certain Research, Co-Development and Commercialization Agreement, dated as of April 20, 2004, as amended by Amendment Number 1 to Research, Co-Development and Commercialization Agreement and Research License and Option Agreement, dated as of October 20, 2006 (as amended, the “ Collaboration Agreement ”);

 

WHEREAS , pursuant to the Collaboration Agreement, Seller and Buyer have collaborated in the discovery of a next-generation G-CSF (as hereinafter defined) (the “ Collaboration ”);

 

WHEREAS , subject to the terms and conditions of this Agreement, Seller desires to transfer to Buyer and Buyer desires to acquire the Purchased Assets (as defined herein);

 

WHEREAS , simultaneously with the sale of the Purchased Assets, subject to approval by the Seller’s stockholders, Seller intends to sell substantially all of its remaining assets to Novo Nordisk A/S (“ Novo ”) pursuant to an asset purchase agreement between Seller and Novo (the “ Novo Asset Purchase Agreement ”);

 

WHEREAS , immediately prior to the sale of the Purchased Assets, Seller and Buyer will enter into a license agreement (the “ BGX License Agreement ”) and a sublicense agreement (the “ BGX Sublicense Agreement ”) pursuant to which Seller will exclusively license or sublicense, as the case may be, certain of its rights in the Novo Transferred Assets (as hereinafter defined) to Buyer;

 

WHEREAS , simultaneously with the sale of assets to Novo pursuant to the Novo Asset Purchase Agreement, Seller shall assign the BGX License Agreement and the BGX Sublicense Agreement, Novo shall assume all of Seller’s rights, duties and obligations thereunder, and Novo and Buyer shall enter into patent cooperation agreement (the “ Patent Cooperation Agreement ”) pursuant to which the parties will enter into agreements with respect to the prosecution, maintenance and use of the patent rights included in the Novo Transferred Assets;

 

WHEREAS , upon the closing of the asset sale transaction contemplated hereby, Seller and Buyer shall terminate the Collaboration Agreement; and

 

WHEREAS , after closing of the sale, Seller intends to dissolve and distribute its remaining assets to its stockholders.

 

 

NOW, THEREFORE, in consideration of the mutual benefits to be derived from this Agreement and of the representations, warranties, conditions, agreements and promises contained herein and 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:

 

ARTICLE I
DEFINITIONS; INTERPRETATION

 

Section 1.1.            Definitions .  The capitalized terms used in this Agreement have the respective meanings ascribed to them as follows:

 

“ Acquisition Proposal ” means any bona fide written proposal (other than the asset sale and related transactions contemplated by the Novo Asset Purchase Agreement), made by a party to acquire beneficial ownership (as defined under Rule 13(d) promulgated under the Securities Exchange Act) of all or a material portion of the assets of, or any material equity interest in, Seller pursuant to a merger, consolidation or other business combination, sale of shares of capital stock, sale of assets, licensing transaction, tender or exchange offer or similar transaction involving Seller, including any single or multi-step transaction or series of related transactions that is structured to permit such party to acquire beneficial ownership of any material portion of the assets of, or any material equity interest in, Seller.  For purposes of the definition of Acquisition Proposal, a material portion of the assets of, or material equity interest in, Seller means greater than 20% of the assets of, or equity interest in, Seller.

 

“ Act ” means the United States Federal Food, Drug and Cosmetic Act and the rules, regulations, guidelines, guidances and requirements promulgated thereunder, as may be in effect from time to time.

 

“ Action ” means any claim, action, suit, arbitration, inquiry, audit, proceeding or investigation by or before or otherwise involving, any Governmental Authority.

 

“ Affiliate ” means, with respect to any Person, any other Person directly or indirectly Controlling or Controlled by, or under direct or indirect common Control with, such first Person.

 

“ Agreement ” has the meaning set forth in the preamble hereof.

 

“ Applicable Law ” means the applicable laws, rules, regulations, including any guidelines, or other requirements of any Governmental Authorities, that may be in effect from time to time.

 

“ Applicable Period ” has the meaning set forth in Section 5.12(b).

 

“ Apportioned Obligations ” has the meaning set forth in Section 5.6(b).

 

“ Assumed Contracts ” has the meaning set forth in Section 2.2(a)(vi).

 

“ Assumed Liabilities ” has the meaning set forth in Section 2.3.

 

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“ BGX License Agreement ” has the meaning set forth in the recitals.

 

“ BGX Sublicense Agreement ” has the meaning set forth in the recitals.

 

“ Books and Records ” means all books, records, files (including data files) and documents (including research and development records, annuity payment reports, correspondence and, to the extent not originals, true, accurate and complete copies of all files relating to the filing, prosecution, issuance, maintenance, enforcement or defense of any Intellectual Property, including file wrappers, ribboned and sealed letters patents, written third party correspondence, records and documents, including laboratory notebooks, procedures, tests, dosage information, criteria for patient selection, safety and efficacy and study protocols, investigators brochures and all pharmacovigilence and other safety records) in all forms, including electronic, in which they are stored or maintained, and all data and information included or referenced therein, in each case that are owned or Controlled by Seller.

 

“ Business Day” means any day excluding Saturdays, Sundays and any day that is a legal holiday under the laws of the United States or the Federal Republic of Germany or that is a day on which banking institutions located in New York, New York or Mannheim, Germany are authorized or required by Applicable Law or other governmental action to close.

 

“ Buyer ” has the meaning set forth in the preamble hereof.

 

“ Buyer’s Knowledge ” (and similar phrases) means the knowledge of any officer or director of Buyer, and the knowledge any such Person would have had if he had performed his services and duties in the ordinary course of business on behalf of Buyer in a reasonably diligent manner.

 

“ Change in Recommendation ” has the meaning set forth in Section 5.12(c).

 

“ Closing ” has the meaning set forth in Section 2.4.

 

“ Closing Date ” has the meaning set forth in Section 2.4.

 

“ Code ” means the Internal Revenue Code of 1986, as amended from time to time.

 

“ Collaboration ” has the meaning set forth in the recitals.

 

“ Collaboration Agreement ” has the meaning set forth in the recitals.

 

“ Combined Purchased Assets ” has the meaning set forth in Section 2.2(b).

 

“ Consent ” means, with respect to a Contract, any consent or approval of any Person other than either party to this Agreement that, in accordance with the terms of such Contract, is required to be obtained for the assignment, license or sublicense thereof to Buyer.

 

“ Contracts ” means contracts, commitments, arrangements, agreements, leases, subleases, licenses, sublicenses, purchase orders for the sale or purchase of goods or services and any other understandings, in each case whether oral or written.

 

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“ Control ” including its various tenses and derivatives (such as “ Controlled ” and “ Controlling ”) means (a) for purposes of the definition of Affiliate, a Person that (i) owns or controls, directly or indirectly, or has the ability to direct or cause the direction or control of, more than 50% of the voting equity of the other Person, or (ii) has the ability to direct, cause the direction of, or control the actions of such other Person, whether through direct or indirect ownership of voting equity, by Contract or otherwise and (b) when used with respect to any item of Intellectual Property, possession of the right, whether directly or indirectly, and whether by ownership, license or otherwise, to assign or grant a license, sublicense or other right to or under such Intellectual Property.

 

“ Dollars ” or “ $ ” means United States dollars.

 

“ EMEA ” means the European Agency for the Evaluation of Medicinal Products, or any successor agency thereto.

 

“ Employee ” means an individual who is currently providing services to Seller in respect of the Purchased Assets or Licensed Assets as an employee or consultant of Seller.

 

“ End Date ” has the meaning set forth in Section 7.1(b).

 

“ Excluded Assets ” has the meaning set forth in Section 2.2(c).

 

“ Excluded Intellectual Property ” means all right, title and interest of Seller in and to Intellectual Property relating exclusively to the Exploitation of (i) non-GlycoPEGylated glycolipids or oligosaccharides, in each case not attached to a peptide or protein, including the Patent Rights set forth on Schedule 1.1(b)(i) , and (ii) the Patent Rights set forth on Schedule 1.1(b)(ii) .

 

“ Excluded Liabilities ” has the meaning set forth in Section 2.3(b).

 

“ Existing Confidentiality Agreement ” means the Confidentiality and Non-Disclosure Agreement, dated as of November 20, 2007, by and between Buyer and Seller.

 

“ Exploit ” or “ Exploitation ” means to make, have made, import, use, sell, offer for sale, or otherwise dispose of, including all discovery, research, development, registration, modification, enhancement, improvement, Manufacture, storage, formulation, optimization, importation, exportation, transportation, distribution, promotion and marketing activities related thereto.

 

“ FDA ” means the United States Food and Drug Administration, or any successor agency thereto.

 

“ G-CSF ” means any and all forms of granulocyte-colony stimulating factor, including full length G-CSF, truncated G-CSF, fusion proteins, fragments, derivatives, analogs, mutants, splice variants, and conjugates with other molecular entities such as proteins, peptides, organic or inorganic substances.

 

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“ Governmental Authority ” means any supra-national, federal, state, local or foreign government, legislature, governmental or administrative agency, department, commission, bureau, board, instrumentality, self-regulatory association or authority (including stock exchanges), court or other authority of tribunal of competent jurisdiction (including any arbitration or other alternative dispute forum), or any other governmental authority or instrumentality anywhere in the world.

 

“ IND ” means (a) an Investigational New Drug Application, as defined in the Act, which is required to be filed with the FDA before beginning clinical testing of a product in human subjects, and its equivalent in other countries or regulatory jurisdictions outside the United States or any successor application or procedure, and (b) all supplements and amendments that may be filed with respect to the foregoing.

 

“ Intellectual Property ” means all intellectual property rights, whether registered or unregistered, including (a) Patent Rights, (b) Trademarks, (c) Know-How, (d) all completed or pending registrations, renewals or applications for registration or renewal of any of the foregoing, (e) copies and tangible embodiments of any of the foregoing (in whatever form or media) and (f) other tangible and intangible information or material.

 

“ Inventory ” has the meaning set forth in Section 2.2(a)(iii).

 

“ Know-How ” means any and all formulae, procedures, processes, methods, designs, know-how, trade secrets and other proprietary information, discoveries, licenses, software and source code, programs, prototypes, designs, techniques, ideas, concepts, data, engineering and Manufacturing information, electronic control circuits, specifications, diagrams, drawings, schematics, blueprints and parts lists and other proprietary information, rights and works of authorship, whether or not reduced to writing.

 

“ Licensed Assets ” means, collectively, the Intellectual Property to be licensed or sublicensed to Buyer pursuant to the BGX License Agreement and the BGX Sublicense Agreement.

 

“ Lien ” means any lien (statutory or otherwise), security interest, pledge, hypothecation, mortgage, assessment, lease, claim, levy, license, defect in title, charge, or any other third party right, license or property interest of any kind, or any conditional sale or other title retention agreement, right of first option, right of first refusal or similar restriction, any covenant not to sue, or any restriction on use, transfer, receipt of income or exercise of any other attribute of ownership or any agreement to give any of the foregoing in the future or similar encumbrance of any kind or nature whatsoever.

 

“ Losses ” means any and all liabilities, judgments, claims, settlements, losses, damages, fees, Liens, penalties, obligations and expenses (including reasonably attorneys’ fees and expenses and costs and expenses of investigation) incurred or suffered, directly or indirectly, by Buyer or any of its Affiliates arising from, by reason of or in connection with any breach or inaccuracy of any representation or warranty of Seller in this Agreement.

 

“ Magnolia ” has the meaning set forth in Section 2.2(c)(ix).

 

5

 

“ Manufacture ” and “ Manufacturing ” means, with respect to a product or compound, the manufacturing, processing, formulating, packaging, labeling, holding and quality control testing of such product or compound.

 

“ Material Adverse Effect ” means any event, state of facts, circumstance, development, change or effect that, individually or in the aggregate with all other events, states of facts, circumstances, developments, changes or effects, (a) is materially adverse to the business, assets, liabilities, operations, condition (financial or otherwise), or results of operations of Seller, taken as a whole, (b) is materially adverse to the Purchased Assets and the Licensed Assets, or (c) materially impacts, materially delays or prevents the consummation of the transactions contemplated hereby, other than any event, state of facts, circumstance, development, change or effect resulting from (i) changes in general economic market conditions, (ii) general changes or developments in the industries in which Seller operates; (iii) changes in the price or trading volume of Seller’s common stock ( provided that the underlying changes, events, occurrences, state of facts or developments that caused or contributed to any such change may otherwise be taken into consideration in determining whether a Material Adverse Effect has occurred), (iv) changes in U.S. GAAP, (v) that can be directly attributed to the announcement or performance of this Agreement and the transactions contemplated hereby, including compliance with the covenants set forth herein, or any action taken or omitted to be taken by Seller at the written request or with the prior written consent of Buyer, (vi) any failure by Seller to meet revenue or earnings projections, in and of itself ( provided that the underlying changes, events, occurrences, states of facts or developments that caused or contributed to such failure to meet published revenue or earnings projections may otherwise be taken into consideration in determining whether a Material Adverse Effect has occurred); (vii) acts of war or terrorism or natural disasters, except, in the case of the foregoing clauses (i), (ii), (iii) and (vii) to the extent such changes or developments referred to therein have a disproportionate impact on Seller relative to other industry participants or would prevent or materially impair or materially delay the ability of Seller to perform its obligations under this Agreement or to consummate the transactions contemplated hereby.

 

“ Materials ” means any materials, including raw materials, DNA sequences, vectors, plasmids, cells, cell clones, enzymes, substrates, products, intermediates, references, analytical standards and retained samples.

 

“ Medical Product Regulatory Authority ” means any Governmental Authority that is concerned with the safety, efficacy, reliability, manufacture, investigation, sale or marketing of pharmaceuticals, medical products, biologics or biopharmaceuticals, including the FDA and the EMEA.

 

“ Mutual Release Agreement ” has the meaning set forth in Section 6.2(f).

 

“ Notice of Termination ” has the meaning set forth in Section 7.2(a).

 

“ Novo ” has the meaning set forth in the recitals.

 

“ Novo Asset Purchase Agreement ” has the meaning set forth in the recitals.

 

6

 

“ Novo Assignment and Assumption Agreement ” has the meaning set forth in Section 6.2(f).

 

 “ Novo Transferred Assets ” has the meaning set forth in Section 2.2(c)(i).

 

“ Order ” means any writ, judgment, decree, injunction or similar order, including consent orders, of any Governmental Authority (in each such case whether preliminary or final).

 

“ Patent Cooperation Agreement ” has the meaning set forth in the recitals.

 

“ Patent Rights ” means individually and collectively any and all patents and/or patent applications and provisional applications, all inventions disclosed therein, and any and all continuations, continuations-in-part, continued prosecution applications, divisions, renewals, patents of addition, reissues, confirmations, registrations, revalidations, revisions and re-examinations thereof, utility models, petty patents, design registrations and any all patents issuing therefrom and any and all foreign counterparts thereof and extensions of any of the foregoing, including under the United States Patent Term Restoration Act, and Supplementary Protection Certificates (SPCs) according to Counsel Regulation (EEC) No. 1768/92 and similar extensions for other patents under any Applicable Laws.

 

“ Permitted Liens ” means (a) Liens for Taxes not yet due and payable and (b) statutory worker’s, carrier’s, mechanic’s, materialmen’s, and similar Liens arising in the ordinary course of business and consistent with past practice and that are not delinquent.

 

“ Person ” means a human being, labor organization, partnership, firm, enterprise, association, joint venture, corporation, limited liability company, cooperative, legal representative, foundation, society, political party, estate, trust, trustee, trustee in bankruptcy, receiver or any other organization or entity whatsoever, including any Governmental Authority.

 

“ Post-Closing Confidentiality Agreement ” has the meaning set forth in Section 5.2.

 

“ Post-Closing Tax Period ” has the meaning set forth in Section 5.6(b).

 

“ Pre-Closing Tax Period ” means (a) any Tax period ending on or before the Closing Date and (b) with respect to a Tax period that commences before but ends after the Closing Date, the portion of such period up to and including the Closing Date.

 

“ Proxy Statement ” has the meaning set forth in Section 3.4.

 

“ Purchase Price ” has the meaning set forth in Section 2.1(a)(i).

 

“ Purchase Price Allocation ” has the meaning set forth in Section 2.5(a).

 

“ Purchased Assets ” has the meaning set forth in Section 2.2.

 

“ Recommendation ” has the meaning set forth in Section 3.2(a).

 

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“ Regulatory Approval ” means, with respect to a country or other jurisdiction, any and all approvals (including pricing and reimbursement approvals), licenses, registrations or authorizations of any Governmental Authority necessary for the Exploitation of any compound or product generated under or in connection with the Purchased Assets or the Licensed Assets, as the case may be, in such country or other jurisdiction, including, where applicable, (a) approval of any such product, including any INDs, new drug applications and supplements and amendments thereto; (b) pre- and post-approval marketing authorizations (including any prerequisite manufacturing approval or authorization related thereto); (c) labeling approval; and (d) technical, medical and scientific licenses.

 

“ Regulatory Documentation ” means all applications, registrations, licenses, authorizations and approvals (including all Regulatory Approvals), all correspondence submitted to or received from Medical Product Regulatory Authorities (including minutes and official contact reports relating to any communications with any Medical Product Regulatory Authority) and all supporting documents and all clinical studies and tests, and all data contained in any of the foregoing, including all INDs, marketing authorizations, regulatory drug lists, advertising and promotion documents, adverse event files, complaint files and Manufacturing records generated in connection with the operations of Seller prior to the Closing Date including, for clarity, original and, if available, electronic copies of all (a) clinical studies and tests and all data generated therefrom (including case report forms), (b) all correspondence and other documentation related to communications to or from Medical Product Regulatory Authorities and (c) all other supporting documentation and materials that would be necessary or useful to obtain or maintain Regulatory Approvals.

 

“ Related Documents ” means, other than this Agreement, all agreements, certificates and documents signed and delivered by either party in connection with this Agreement, exclusive of the Novo Asset Purchase Agreement and any related or ancillary documents thereto.

 

“ Representation and Warranty Policy ” has the meaning set forth in Section 5.13(a).

 

“ Required Stockholder Vote ” has the meaning set forth in Section 3.2(b).

 

“ SEC ” means the United States Securities and Exchange Commission.

 

“ Securities Act ” has the meaning set forth in Section 3.5(a).

 

“ Securities Exchange Act ” has the meaning set forth in Section 3.5(a)

 

“ Seller ” has the meaning set forth in the preamble hereof.

 

“ Seller Collaboration Activities ” means those tests, studies and other activities conducted by or on behalf of Seller under or in connection with the Collaboration Agreement.

 

“ Seller SEC Documents ” has the meaning set forth in Section 3.5(a).

 

“ Seller’s Financial Advisor ” means RBC Capital Markets Corporation.

 

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“ Seller’s Knowledge ” (and similar phrases) means the actual knowledge of any of the individuals listed on Schedule 1.1(c) , after making due inquiry of the Employees having primary responsibility for such matter.

 

“ Seller Stockholders Meeting ” has the meaning set forth in Section 5.4(c).

 

“ Superior Acquisition Proposal” means any unsolicited Acquisition Proposal made by a third party for consideration to Seller’s stockholders or Board of Directors providing for the payment or exchange of cash and/or securities for all of the shares of Seller’s capital stock then outstanding or all or substantially all the assets of Seller (other than the asset sale and related transactions contemplated by the Novo Asset Purchase Agreement), which the Board of Directors of Seller, acting in its good faith judgment, determines (a) is superior to Seller’s stockholders from a financial point of view to the transactions contemplated by this Agreement and the Related Documents, (b) is reasonably likely to be consummated on its terms, taking into account all legal, financial, regulatory and other aspects of the proposal, and (c) if providing for the payment of cash to Seller or its stockholders, is supported by fully-committed financing, subject to customary conditions.

 

“ Tail Policy ” has the meaning set forth in Section 5.13(c).

 

“ Tax ” or “ Taxes ” means any and all federal, state, local, foreign and other taxes, assessments, levies, tariffs, duties or other charges or impositions in the nature of a tax (together with any and all interest, penalties, additions to tax and additional amounts imposed with respect thereto) imposed by any Governmental Authority, including income, estimated income, gross receipts, profits, business, license, occupation, franchise, capital stock, real or personal property, sales, use, transfer, value added, ad valorem, turnover, payroll, severance, employment or unemployment, social security, disability, alternative or add-on minimum, customs, excise, stamp, environmental, commercial rent or withholding taxes, and shall include any liability for Taxes of any other Person under Applicable Law, as a transferee or successor, by contract or otherwise.

 

“ Tax Return ” means any return, declaration, report, claim for refund, information return or statement relating to Taxes, including any schedule or attachment thereto, filed or maintained, or required to be filed or maintained, in connection with the calculation, determination, assessment or collection of any Tax and shall include any amended returns.

 

“ Technical Transition Employees ” has the meaning set forth in Section 5.9.

 

“ Technical Transition Period ” has the meaning set forth in Section 5.9.

 

“ Termination Fee ” has the meaning set forth in Section 7.2(c).

 

“ Third Party License Agreements ” has the meaning set forth in Section 3.7(b).

 

“Trademark” means (a) any word, name, symbol, color, designation or device or any combination thereof, including any trademark, trade dress, brand mark, trade name, brand name, logo or business symbol; (b) all registrations and applications for any of the foregoing; and (c) all rights and priorities connected with the foregoing afforded under Applicable Law.

 

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“ Transfer Date ” means with respect to an Assumed Contract requiring a Consent, the date such Consent is obtained and such Assumed Contract is duly assigned to Buyer.

 

“Transferred Know-How ” means all Know-How Controlled by Seller as of the Closing Date (a) to the extent covered or claimed by the Transferred Patent Rights or (b) otherwise relating to the BGX Field of Use (as defined in the BGX License Agreement), excluding any Know-How comprising part of the Excluded Intellectual Property or Novo Transferred Assets.

 

“ Transferred Intellectual Property ” means the Transferred Patent Rights, Transferred Trademarks and Transferred Know-How.

 

“ Transferred Patent Rights ” means those Patent Rights listed on Schedule 1.1(a) .

 

“ Transferred Trademarks ” means the Trademarks listed on Schedule 1.1(d) .

 

“ Transfer Taxes ” has the meaning set forth in Section 5.6(a).

 

“ Transition Plan ” has the meaning set forth in Section 2.2(b).

 

“ UC License Agreement ” means the Exclusive License Agreement for Method of Producing Secretable Glycosyltransferases and Golgi Processing Enzymes and Production of Soluble Recombinant Beta-Galactoside Alpha-2,3 Sialyltransferase between The Regents of the University of California and Cytel Corporation, dated February 25, 1999, as amended March 23, 1999 to substitute Seller for Cytel, as amended December 8, 2003, as amended January 24, 2005, as amended March 23, 2005.

 

“ U.S. GAAP ” means those generally accepted accounting principles in the United States, applied on a consistent basis.

 

Section 1.2.                                    Interpretation .

 

(a)                                   Descriptive headings are for convenience only and shall not control or affect the meaning or construction of any provision of this Agreement.

 

(b)                                  Except as otherwise expressly provided in this Agreement or as the context otherwise requires, the following rules of interpretation apply to this Agreement:  (i) the singular includes the plural and the plural includes the singular; (ii) “or” and “any” are not exclusive and the words “include” and “including,” and variations thereof, shall not be deemed to be terms of limitation, but rather shall be deemed to be followed by the words “without limitation;” (iii) a reference to any Contract includes permitted supplements and amendments; (iv) a reference to an Applicable Law includes any amendment or modification to such Applicable Law; (v) a reference to a Person includes its successors, heirs and permitted assigns; (vi) a reference to one gender shall include any other gender; (vii) a reference in this Agreement to an Article, Section, Exhibit or Schedule is to the referenced Article, Section, Exhibit or Schedule of this Agreement; (viii) “hereunder,” “hereof,” and words of similar import shall be deemed references to this Agreement as a whole and not to any particular Article, Section or other provision; and (ix) “commercially reasonable efforts” of a party to this Agreement shall be

 

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construed as the efforts that a prudent Person in such party’s industry, desirous of achieving a result, would use in similar circumstances to achieve that result as expeditiously as possible.

 

(c)                                   The parties hereto agree that they have been represented by counsel during the negotiation, drafting, preparation and execution of this Agreement and, therefore, waive the application of any Applicable Law or rule of construction providing that ambiguities in an agreement or other document will be construed against the party drafting such agreement or document.

 

ARTICLE II
PURCHASE AND SALE

 

Section 2.1.                                    Purchase and Sale of Assets; Purchase Price .

 

(a)                                   Pursuant to the terms and subject to the conditions of this Agreement, at the Closing, Seller shall sell, convey, deliver, transfer and assign to Buyer, free and clear of all Liens (other than Permitted Liens), and Buyer shall purchase, take delivery of and acquire from Seller, all of Seller’s right, title and interest in, to and under all of the Purchased Assets of Seller.  In consideration of the sale, conveyance, delivery, transfer, and assignment of the Purchased Assets to Buyer, Seller’s license and sublicense of the Licensed Assets to Buyer pursuant to the BGX License Agreement and the BGX Sublicense Agreement, and Seller’s other covenants and obligations hereunder, at the Closing and pursuant to the terms and subject to the conditions hereof, Buyer shall:

 

(i)                                 pay Seller an amount equal to $22,000,000 (the “ Purchase Price ”); and

 

(ii)                              assume the Assumed Liabilities.

 

(b)                                  Pursuant to the terms and subject to the conditions of this Agreement, at the Closing, Buyer shall deliver the Purchase Price to Seller, by wire transfer of immediately available funds to the account set forth on Schedule 6.4(b)(i) .

 

Section 2.2.                                    Purchased Assets; Licensed Assets; Excluded Assets.

 

(a)                                   The term “ Purchased Assets ” means all of Seller’s right, title and interest in and to all properties and assets (tangible or intangible) identified in this Section 2.2, other than the Excluded Assets (as set forth in Section 2.2(c)), including the following:

 

(i)                                 the Transferred Intellectual Property;

 

(ii)                              all tangible embodiments of the Transferred Intellectual Property, such as Books and Records relating to the Exploitation of the Transferred Intellectual Property, including original files relating to the Exploitation of all Transferred Patent Rights;

 

(iii)                           all inventory of any Materials related to the Purchased Assets or the Licensed Assets in Seller’s possession or control as of the Closing Date (the “ Inventory ”),

 

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including specifically all such Materials that are to be delivered to Buyer in accordance with the Transition Plan, but excluding any such Materials included in the Novo Transferred Assets that were Manufactured solely for the Seller’s collaboration with Novo and any Materials relating exclusively to the Excluded Assets;

 

(iv)                               all Regulatory Documentation, including all tangible embodiments thereof, to the extent related to the Seller Collaboration Activities, excluding any INDs included in such Regulatory Documentation;

 

(v)                                  all claims, counterclaims, credits, causes of action, rights of recovery, and rights of indemnification or setoff against third parties, insurance benefits and other claims and rights of Seller to the extent relating to the Seller Collaboration Activities, any Purchased Assets or the Assumed Liabilities, and all other intangible property rights that relate to the Seller Collaboration Activities, any Purchased Assets or the Assumed Liabilities; and

 

(vi)                               all rights in, under and to the Contracts set forth on Schedule 2.2(a)(vi)  (collectively, the “ Assumed Contracts ”), including all rights to receive goods and services purchased and to Exploit Intellectual Property licensed pursuant to such Contracts, and all rights to assert claims and take other actions in respect of breaches or other violations of the foregoing.

 

(b)                                  Transition Plan .  Seller acknowledges and agrees that the Purchased Assets assigned and transferred to Buyer pursuant to this Agreement and the Novo Transferred Assets assigned and transferred to Novo pursuant to the Novo Asset Purchase Agreement (collectively, the “ Combined Purchased Assets ”) shall include tangible embodiments of all Intellectual Property assigned or transferred pursuant to this Agreement or the Novo Asset Purchase Agreement, and all Books and Records and Regulatory Documentation relating to such Intellectual Property that are under the Control of Seller, except as may otherwise be agreed in writing by Seller and Buyer.  Seller, Buyer and Novo shall cooperate in the transfer of such tangible embodiments of the Combined Purchased Assets that are to be delivered to Buyer at Closing in accordance with Section 2.2 and the written transition plan as set forth on Schedule 2.2(b)  (as the same may be amended from time to time prior to the Closing Date by written agreement of Seller and Buyer, the “ Transition Plan ”).  Buyer acknowledges that the Transition Plan, as amended through the Closing Date, sets forth the full and complete delivery requirements of Seller with respect to the Purchased Assets and the Licensed Assets.  Any copying fees and expenses relating to the Purchased Assets or the Licensed Assets incurred in connection with the Transition Plan or the implementation thereof shall be borne by Seller and any transportation or shipping fees relating to the Purchased Assets or the Licensed Assets shall be borne by Buyer.  In accordance with the Transition Plan, Seller will cooperate with any reasonable arrangements agreed upon by Buyer and Novo with respect to ensuring access following the Closing to Books and Records and Regulatory Documentation embodied in electronic databases or other formats that cannot reasonably be divided or copied.

 

(c)                                   Notwithstanding Section 2.2(a), Buyer shall not acquire from Seller pursuant to this Agreement any other assets of Seller, including the following assets (collectively, the “ Excluded Assets ”):

 

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(i)                                      all assets to be transferred to Novo pursuant to the Novo Asset Purchase Agreement (the “ Novo Transferred Assets ”);

 

(ii)                                   all cash, cash equivalents, investments, securities and bank or other deposit accounts of Seller;

 

(iii)                                any refunds, claims for refunds or rights to receive refunds from any Governmental Authority with respect to Taxes paid or to be paid by Seller;

 

(iv)                               the equipment, office supplies, accessories, tooling, tools, fixtures and furniture that are not Purchased Assets;

 

(v)                                  any records (including accounting records) related to Taxes paid or payable by Seller and all financial and Tax records that form part of the general ledger of Seller;

 

(vi)                               all insurance benefits, including rights and proceeds, arising from or relating to the Excluded Assets or the Excluded Liabilities;

 

(vii)                            Seller’s certificate of incorporation, bylaws, minute books, stock records and corporate seal;

 

(viii)                         all Contracts, including the Third Party License Agreements, that are not Assumed Contracts;

 

(ix)                                 any right relating to Magnolia Nutritionals LLC (“ Magnolia ”);

 

(x)                                    any right, title or interest to the Excluded Intellectual Property and any associated right, obligation or liability; and

 

(xi)                                 any of the rights of Seller under this Agreement, the Related Documents and the Novo Asset Purchase Agreement and any ancillary documents related thereto.

 

Section 2.3.                                    Assumed Liabilities; Excluded Liabilities .

 

(a)                                   Assumed Liabilities .  Pursuant to the terms and subject to the conditions of this Agreement, at the Closing, Seller shall sell, convey, transfer and assign to Buyer, and Buyer shall assume from Seller, the Assumed Liabilities.  “ Assumed Liabilities ” means performance obligations arising (i) after the Closing Date in connection with the Regulatory Documentation included in the Purchased Assets but excluding any such obligations arising out of or resulting from any breach or violation of such Regulatory Documentation or any related requirement of Applicable Law by Seller on or prior to the Closing Date; or (ii) under the Assumed Contracts accruing with respect to the period commencing, as applicable, after the Closing Date or the Transfer Date (if Consent to assignment thereof is required) (other than liabilities or obligations attributable to any failure by Seller to comply with the terms thereof).  Notwithstanding any other provision of this Agreement, Buyer does not assume and has no

 

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responsibility for any liabilities or obligations of Seller other than the Assumed Liabilities specifically identified in this Section 2.3(a).

 

(b)                                  Excluded Liabilities .  Notwithstanding any provision in this Agreement or any other writing to the contrary, neither Buyer nor any of its Affiliates is assuming any liability or obligation of Seller (or any predecessor of Seller or any prior owner of all or part of its businesses or assets) of whatever nature, whether presently in existence or arising hereafter, other than the Assumed Liabilities.  All such liabilities and obligations shall be retained by and remain obligations and liabilities of Seller (all such liabilities and obligations not being assumed being herein referred to as the “ Excluded Liabilities ”).  Notwithstanding any provision in this Agreement or any other writing to the contrary and without limiting the generality of the foregoing, the Excluded Liabilities shall include:

 

(i)                                      all liabilities and obligations of Seller, or any member of any consolidated, affiliated, combined or unitary group of which Seller is or has been a member, for Taxes; provided that Transfer Taxes incurred in connection with the transactions contemplated by this Agreement and Apportioned Obligations shall be paid in the manner set forth in Section 5.6(b) hereof;

 

(ii)                                   all liabilities and obligations relating to employee benefits or compensation arrangements in relation to Seller, whether relating or attributable to, or arising during, the period before or after Closing, including all liabilities or obligations under any employee benefit agreements, plans or other arrangements;

 

(iii)                                all liabilities and obligations arising from any Action relating to Seller, the Purchased Assets or the Licensed Assets pending before any arbitrator or Governmental Authority;

 

(iv)                               all liabilities and obligations relating to or arising from any asset, property or business of Seller that is not a Purchased Asset or a Licensed Asset, whether relating or attributable to, or arising during, the period before or after Closing;

 

(v)                                  all liabilities and obligations relating or attributable to any owned, leased or operated Purchased Asset or Licensed Asset prior to Closing, including in relation to any contract, agreement, lease, license, commitment, sales or purchase order or other instrument; and

 

(vi)                               all liabilities and obligations in relation to Magnolia.

 

Section 2.4.                                    Closing .  Pursuant to the terms and subject to the conditions of this Agreement, the closing of the transactions contemplated by this Agreement (the “ Closing ”) shall take place at the offices of Morgan Lewis & Bockius LLP, 502 Carnegie Center, Princeton, NJ 08540, at 10:00 a.m. local time within five (5) Business Days following the satisfaction or waiver of all of the conditions or obligations set forth in Article VI, or such other time and place as Buyer and Seller may agree to in writing (such date, the “ Closing Date ”).

 

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Section 2.5.                                    Purchase Price Allocation .

 

(a)                                   Prior to the Closing Date, Buyer shall provide to Seller copies of IRS Form 8594 and any required exhibits (the “ Purchase Price Allocation ”) setting forth Buyer’s proposed allocation of the Purchase Price and the Assumed Liabilities among the Purchased Assets and the Licensed Assets in accordance with Section 1060 of the Code.  Within 20 days after the receipt of the Purchase Price Allocation, Seller shall propose to Buyer any changes to the Purchase Price Allocation or shall be deemed to have indicated its concurrence therewith.  Buyer and Seller shall endeavor in good faith to resolve any differences with respect to the Purchase Price Allocation within 20 days after Buyer’s receipt of notice of objection from Seller.

 

(b)                                  If Seller objects to the Purchase Price Allocation within the period provided in Section 2.5(a) and Buyer and Seller are unable to resolve any differences that, in the aggregate, are material in relation to the Purchase Price, then any remaining disputed matters shall be finally and conclusively determined by an independent accounting firm of recognized national standing selected by Buyer and Seller, which firm shall not be the regular auditing firm of Buyer or Seller.  Promptly, but not later than 20 days after its acceptance of its appointment, such accounting firm shall determine (based solely on presentations by Buyer and Seller and not by independent review) only those matters in dispute and shall render a written report as to the disputed matters and the resulting allocation of the Purchase Price and the Assumed Liabilities, which report shall be conclusive and binding upon the parties.  Buyer and Seller shall, subject to the requirements of Applicable Law, file all Tax Returns and reports consistent with the allocation provided in the Purchase Price Allocation as determined by such accounting firm.  The fees and expenses of such accounting firm shall be shared equally by Buyer and Seller.

 

(c)                                   Seller and Buyer agree to act in accordance with the Purchase Price Allocation in any Tax Return, including any forms or reports required to be filed pursuant to Section 1060 of the Code or any provisions of any comparable Applicable Law, unless there has been a final “determination,” as defined in Section 1313(a) of the Code, in which the allocation is modified.  Buyer and Seller shall cooperate in the preparation of such Tax Returns and file such forms as may be required by Applicable Law.  Neither Buyer nor Seller shall take a position inconsistent therewith upon examination of any Tax Return, in any refund claim, or in any litigation or investigation, without the prior written consent of the other party, except as required by Applicable Law.  In the event that the Purchase Price Allocation is disputed by any Governmental Authority, the party receiving notice of the dispute shall promptly notify the other party hereto in writing of such notice and resolution of the dispute.

 

Section 2.6.                                    Books and Records .  Subject to the Post-Closing Confidentiality Agreement and the Transition Plan, Buyer agrees and acknowledges that Seller may retain photocopies or other duplications of certain Books and Records relating to the Purchased Assets or the Licensed Assets to the extent necessary for Tax, regulatory or accounting purposes.

 

Section 2.7.                                    Privileges .  Buyer acknowledges that the Purchased Assets include certain attorney work product protections, attorney-client privileges and similar legal protections and privileges with which Seller may be entitled in connection with the Purchased Assets or Assumed Liabilities, including the freedom to operate opinions listed on Schedule 2.7 . Accordingly, Seller is not waiving, and shall not be deemed to have waived or diminished, any of its attorney work product protections, attorney-client privileges or similar protections or privileges to the extent allowed by Applicable Law as a result of the disclosure of information to

 

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Buyer and its representatives in connection with this Agreement and the transactions contemplated by this Agreement.  Seller and Buyer (i) share a common legal and commercial interest in all of the information and communications that may subject to such protections and privileges, (ii) are or may become joint defendants in Actions to which such protections and privileges may relate and (iii) intend that such protections and privileges remain intact should either party become subject to any actual or threatened Actions to which such information or communications relate.  Seller agrees that it shall have no right or power after the Closing Date to assert or waive any such protection or privilege included in the Purchased Assets and Seller shall take all actions reasonably requested by Buyer, at the expense of Buyer, in order to permit Buyer, at its sole discretion, to preserve, assert or waive any such protection or privilege.

 

ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLER

 

Seller represents and warrants to Buyer that each statement contained in this Article III is true and correct as of the date hereof and as of the Closing Date, with each such representation and warranty subject to the disclosure Schedules of Seller referenced in such representation or warranty.

 

Section 3.1.                                    Organization, Standing and Power .  Seller is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware and has all requisite corporate power and authority to own, lease and operate its properties and to carry on its business as now being conducted.  Seller is duly qualified to do business and is in good standing in each jurisdiction in which such qualification is necessary because of the property owned, leased or operated by it or because of the nature of its business as now being conducted, except where any failure, individually or in the aggregate, to be so qualified or in good standing does not or could not reasonably be expected to have a Material Adverse Effect.  Accurate and complete copies of Seller’s certificate of incorporation and bylaws, as currently in effect, are available in the Seller SEC Documents (as defined below) and Seller is not in material default under or in material violation of any provision thereof.  Except as set forth on Schedule 3.1 , Seller has no, and since January 1, 2002 Seller has not had, any Affiliates.

 

Section 3.2.                                    Authority; Binding Agreements .

 

(a)                                   The Board of Directors of Seller, at a meeting thereof duly called and held, has duly adopted resolutions by the requisite majority vote approving this Agreement, the Related Documents and the transactions contemplated hereby and thereby determining that the terms and conditions of this Agreement, the Related Documents and the transactions contemplated hereby and thereby are in the best interests of Seller and its stockholders, and recommending that Seller’s stockholders authorize the transactions contemplated by this Agreement and the Related Documents (the “ Recommendation ”).  The foregoing resolutions of the Board of Directors of Seller have not been modified, supplemented or rescinded and remain in full force and effect as of the date hereof.  The Board of Directors of Seller has received an opinion of Seller’s Financial Advisor to the effect that, as of the date of such opinion, the terms and conditions of the transactions contemplated by this Agreement and the Related Documents are fair, from a financial point of view, to Seller.  The foregoing opinion has not been modified, supplemented or rescinded prior to the date of this Agreement.

 

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(b)                                  No stockholder or other equityholder approval is required on behalf of Seller for the execution, delivery or performance of this Agreement, the Related Documents or any of the transactions contemplated hereby or thereby, other than the affirmative vote of the holders of a majority of the outstanding shares of Seller’s common stock (the “ Required Stockholder Vote ”).  Subject to obtaining the Required Stockholder Vote, the execution and delivery by Seller of this Agreement and the Related Documents to which it is or will become a party and the consummation of the transactions contemplated hereby and thereby have been duly and validly authorized by all necessary action on the part of Seller.  Seller has all requisite corporate power and authority to enter into this Agreement and the Related Documents to which it is or will become a party and, subject to obtaining the Required Stockholder Vote, to consummate the transactions contemplated hereby and thereby, and this Agreement and such Related Documents have been, or upon execution and delivery thereof will be, duly executed and delivered by Seller.  This Agreement and the Related Documents to which Seller is or will become a party are, or upon execution and delivery by Seller thereof will be, the valid and binding obligations of Seller, enforceable against Seller in accordance with their respective terms, except to the extent that enforceability is limited by bankruptcy, insolvency or similar laws affecting creditors’ rights and remedies by equitable principles.

 

Section 3.3.                                    Conflicts .  The execution and delivery by Seller of this Agreement and the Related Documents to which it is or will become a party and the consummation of the transactions contemplated hereby and thereby do not and will not:

 

(a)                                   conflict with or result in a breach of the certificate of incorporation, bylaws or other constitutive or organizational documents of Seller;

 

(b)                                  conflict with, result in a default or give rise to any right of termination, cancellation, modification or acceleration under any material note, bond, lease, mortgage, indenture, Contract or other instrument or obligation to which Seller is a party, or by which Seller, the Collaboration or any of the Purchased Assets or Licensed Assets may be bound or affected except as set forth on Schedule 3.3(b) ;

 

(c)                                   assuming the Required Stockholder Vote is obtained and the filings referred to in Section 5.4 are made, conflict with or violate any material Applicable Law with respect to Seller or any of the Purchased Assets or the Licensed Assets; or

 

(d)                                  result in the creation or imposition of any Lien (other than Permitted Liens) upon any Purchased Asset or Licensed Asset.

 

Section 3.4.                                    Consents .  No consent, approval or authorization of, or registration, declaration or filing with, any Governmental Authority is required to be obtained or made by or with respect to Seller in connection with the execution, delivery and performance of this Agreement, the Related Documents, or the consummation of the transactions contemplated hereby and thereby, other than (a) a proxy statement related to the Seller Stockholders Meeting (together with any amendments thereof or supplements thereto, the “ Proxy Statement ”), (b) compliance with the rules of The Nasdaq Stock Market Inc., (c) any notices, applications, authorizations or licenses required under Directive 2001/83/EC, Regulation (EC) No. 726/2004, each as amended, and relevant national implementations thereof, (d) those that may be required

 

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solely by reason of Buyer’s (as opposed to any other third party’s) participation in the transactions contemplated by this Agreement and the Related Documents, and (e) those set forth on Schedule 3.4.

 

Section 3.5.                             Seller Documents; Proxy Statement.

 

(a)                                   Seller has since January 1, 2005 filed all reports, forms, statements, certifications and other documents (collectively, together with all financial statements included or incorporated by reference therein, the “ Seller SEC Documents ”) required to be filed by Seller with the SEC pursuant to the Securities Act of 1933, as amended (together with the rules and regulations of the SEC thereunder, the “ Securities Act ”), or the Securities Exchange Act of 1934, as amended (together with the rules and regulations of the SEC thereunder, the “ Securities Exchange Act ”).  Each of the Seller SEC Documents, as of its filing date and at each time thereafter when the information included therein was updated in accordance with the rules and regulations of the SEC, complied in all material respects with the applicable requirements of the Securities Act and the Securities Exchange Act.  None of the Seller SEC Documents, as of their respective filing dates or any date thereafter when the information included therein was required to be updated pursuant to the rules and regulations of the SEC, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.

 

(b)                                  Each of the financial statements included in the Seller SEC Documents fairly presented in all material respects the financial condition and the results of operations, changes in stockholders’ equity and cash flow of Seller as of the respective dates and for the periods indicated therein, all in accordance with United States generally accepted accounting principles (subject in the case of unaudited interim financial statements to the omission of financial statement footnotes and to normal year end