Exhibit 10.38
NONCOMPETITION AND
NONSOLICITATION AGREEMENT
between
FRESENIUS USA MANUFACTURING,
INC.
and
NABI
BIOPHARMACEUTICALS
November 14,
2006
NONCOMPETITION AND
NONSOLICITATION AGREEMENT
THIS NONCOMPETITION AND
NONSOLICITATION AGREEMENT (this “ Agreement ”), dated
as of November 14, 2006, is between Fresenius USA
Manufacturing, Inc. , a Delaware corporation, (the “
Buyer ”), and Nabi Biopharmaceuticals , a
Delaware corporation (the “ Seller
”).
Background
Statement
The Buyer and the Seller are parties
to an Asset Purchase Agreement dated as of October 11, 2006
(the “ Purchase Agreement ”) pursuant to which
the Buyer is purchasing the PhosLo Business.
The entering into of this Agreement
by the Buyer and the Seller is a condition precedent to the closing
of the transactions contemplated by the Purchase
Agreement.
Statement of
Agreement
The parties agree as
follows:
(a) “ Restricted
Business ” shall mean the business of developing,
licensing, acquiring, manufacturing, marketing, distributing or
selling (i) any phosphate binder or (ii) any product or
device or therapeutic service for the treatment of
hyperphosphaetemia.
(b) “ Ancillary
Acquisition ” shall mean the acquisition by the Seller,
or one of its Affiliates that is an entity, of a product or
products (whether directly through an acquisition or license of
assets or indirectly through an acquisition of capital stock of a
company) as a part of the acquisition of a group of products which
upon such acquisition would constitute a Restrictive Business in
the Territory (“ Competitive Products ”) in
circumstances which do not involve a Sale of the Seller and where
the Seller notifies the Buyer in advance of such acquisition of its
intention to divest the Competitive Products as promptly as
reasonably possible following the acquisition thereof.
(c) “ Sale of the
Seller ” shall mean the sale or transfer by the Seller of
all or substantially all of its assets, the merger of the Seller
with or into another entity or the consummation of any other
similar business transaction as a result of which the shareholders
of the Seller immediately prior to such transaction do not continue
to hold a majority of the outstanding voting securities of the
surviving entity following such transaction.
(d) All other capitalized terms used
in this Agreement and not otherwise defined have the meanings set
forth in the Purchase Agreement.
2. Noncompetition;
Nonsolicitation; No-hire . As an inducement for the Buyer to
enter into the Purchase Agreement and in consideration for the
Buyer’s consummation of the transactions contemplated
thereby, the Seller agrees that:
(a) Until the
15 th
anniversary of the
Closing Date or, if earlier, the date the Buyer, its Affiliates and
their successors and assigns cease entirely to operate the PhosLo
Business (the “ Term ”), the Seller shall not,
and shall cause its Affiliates that are entities not to, directly
or indirectly, (i) engage or invest in, own, manage, operate,
finance, control, or participate in the ownership, management,
operation, financing or control of any Person engaged in, the
Restricted Business or (ii) render any service to, or advise
or consult with, any Person with respect to a Restricted Business,
in each case anywhere in the world, including specifically the
United States of America, Canada and Europe; provided ,
however , that (A) the Seller, together with its
Affiliates that are entities, in the aggregate, may purchase or
otherwise acquire up to (but not more than) two percent
(2%) of any class of securities of any entity engaged in the
Restricted Business if such securities are listed on any national
or regional securities exchange or have been registered under
Section 12(g) of the Securities Exchange Act of 1934, as
amended, and (B) the foregoing provisions of this
Section 2(a) and Section 2(b) shall not
apply in the following circumstances (i) during the first 12
months following an Ancillary Acquisition with respect to the
Competitive Products acquired in the Ancillary Acquisition,
(ii) a Person (or such Person’s Affiliates that are
entities, other than the Seller) engaged in the Restricted Business
acquires the Seller in a Sale of the Seller, but only if such
Person engaged in the Restricted Business as of the closing of such
Sale of the Seller and only if the Seller and its successors and
assigns, and all Employees who are employed by the Seller or any of
its Affiliates that are entities as of the closing of such Sale of
the Seller, do not engage or participate in, or provide advice or
render services with respect to, such Restricted Business,
(iii) a Person (or such Person’s Affiliates that are
entities, other than the Seller) acquires the Seller in a Sale of
the Seller, and is not engaged in the Restricted Business as of the
closing of such Sale of the Seller and later acquires or develops a
Restricted Business, but only if the Seller and its successors and
assigns, and all Employees who are employed by the Seller or any of
its Affiliates that are entities as of the closing of such Sale of
the Seller, do not engage or participate in, or provide advice or
render services with respect to, such Restricted Business, or
(iv) to the Seller and any of its Affiliates that are entities
in connection with the development, licensing, acquisition,
manufacturing, marketing, distribution or sale of New Formulation
Products in any country in which the Seller re-acquires rights to
the New Formulation Products pursuant to Section 8.10(e) of
the Purchase Agreement. For seven (7) years after the Closing
Date, the term “Employees” as used in this
Section 2(a) shall be deemed to include Henrik S. Rasmussen
and Paul Kessler.
(b) During the Term, the Seller
shall not, and shall cause its Affiliates that are entities not to,
directly or indirectly, whether for such Person’s own account
or for any other Person solicit, induce or attempt to induce any
supplier, patient, vendor, licensee or other Person to cease or
reduce doing business with the Buyer or its Affiliates with respect
to the PhosLo Business or in any way interfere with the
relationship between any such supplier, patient, vendor, licensee
or other Perso
