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10-Q
Nov 13, 7:15 AM ET
Galera Therapeutics, Inc. 10-Q
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Contents
64
Article I.TRANSFER OF PROPERTIES AND ASSETS OF SELLER
Section 1.1 Sale and Transfer of Properties and Assets. Upon the terms and subject to the conditions of this Agreement, and in consideration of the purchase by Buyer described below, Buyer hereby agrees to purchase and Seller hereby agrees to, and cause its Affiliates to, sell, transfer, convey, assign and deliver to Buyer, free and clear of all mortgages, pledges, charges, hypothecations, liens, claims, and encumbrances of any kind, nature or description (collectively, “Liens”) (except as expressly permitted in this Agreement and except for Permitted Liens), immediately following the execution of this Agreement (the “Closing”), the following assets exclusively related to the Compounds (collectively, the “Purchased Assets”):
Section 1.2 Excluded Assets. All assets, properties, rights and interests of Seller not included in the Purchased Assets are expressly excluded from the purchase and sale contemplated hereby and as such are not included in the Purchased Assets and shall remain the assets, property rights and interests of Seller (collectively, the “Excluded Assets”), which shall include the Excluded Contract and the Excluded Confidentiality Agreements. For clarity, Seller retains no right, title or interest in or to the Purchased Assets other than (i) the right to receive payments expressly provided for in Section 1.5 and (ii) access and copies of Assigned Books and Records as permitted by Section 1.10(b).
Section 1.3 Assumed Liabilities. Upon the terms and subject to the conditions of this Agreement, at the Closing, Buyer shall assume, and shall pay, perform, satisfy and discharge (or cause to be paid, performed, satisfied and discharged on behalf of Buyer) when due, the following Liabilities of Seller related to the Purchased Assets (collectively, the “Assumed Liabilities”):
Section 1.4 Excluded Liabilities. Notwithstanding anything to the contrary in this Agreement, the Assumed Liabilities will exclude any Liability whatsoever not expressly assumed by Buyer under Section 1.3, including, but not limited to, the following Liabilities, which shall be retained by Seller (collectively, the “Excluded Liabilities”):
Section 1.5 Purchase Price. Upon the terms and subject to the conditions of this Agreement, in full payment for the sale, conveyance, assignment, transfer and delivery of the Purchased Assets, Buyer agrees to assume the Assumed Liabilities and to deliver or cause to be delivered to Seller the following amounts (collectively, the “Purchase Price”) at the following times:
Section 1.6 Tax Matters.
Section 1.7 Seller Closing Deliveries. Seller shall duly execute and/or deliver to Buyer at the Closing:
Section 1.8 Buyer Closing Deliveries. Buyer shall properly execute and deliver to Seller at the Closing:
Section 1.9 Closing. The Closing shall take place remotely by the exchange of documents and signatures (or their electronic counterparts) on the date hereof, concurrently with the execution and delivery of this Agreement.
Section 1.10 Tangible Purchased Assets; Assigned Books and Records.
Section 1.11 Additional Obligations of Seller.
Article II.REPRESENTATIONS AND WARRANTIES OF SELLER
Section 2.1 Corporate Organization, Standing and Power. Seller is a corporation duly organized, validly existing and in good standing under the laws of Delaware. Seller has all necessary corporate power and authority to execute and deliver this Agreement and to perform its obligations hereunder. Seller has all requisite corporate power and authority to carry on its business as now being conducted as relates to the Purchased Assets.
Section 2.2 Consents, Authorization and Enforceability.
Section 2.3 Title to Assets.
Section 2.4 Non-Contravention. Except as set forth on Section 2.4 of the Seller Disclosure Schedule, the execution and delivery of this Agreement by Seller does not and the consummation of the transactions contemplated hereby by Seller will not (a) violate any provision of the certificate of incorporation or similar governance documents that may be applicable to Seller, (b) result in a breach (or any event which, with notice or lapse of time or both, would constitute a breach) of any material term or provision of, or constitute a material default under, any Assumed Contract or other Contract material to the Compounds to which Seller is a party or by which Seller or the Purchased Assets are bound, except as would not reasonably be expected to have a Material Adverse Effect, (c) result in the creation of any Lien on the Purchased Assets (other than a Permitted Lien), or (d) violate in any material respect any Applicable Law or any judgment, decree, order, regulation or rule of any Governmental Authority by which Seller is bound or subject.
Section 2.5 Contracts and Commitments.
Section 2.6 Intellectual Property.
Section 2.7 Regulatory; Clinical; Manufacturing. (a) All Regulatory Filings and Approvals listed on Schedule 1.1(c) are true, complete and correct copies; (b) such filings were, to Seller’s Knowledge, accurate and complete in all material respects at the time filed; (c) Seller has not received written notice of any clinical hold or similar action related to the Compounds; (d) all clinical and nonclinical studies sponsored by Seller in relation to the Compounds have been conducted in all material respects in accordance with Applicable Law; (e) Seller has not received any written notice of debarment or disqualification of any Person involved in such studies; and (f) all material adverse events required to be reported under Applicable Law have been reported to the appropriate Governmental Authorities in accordance with such Applicable Law.
Section 2.8 Inventory; CMC. All Purchased Inventory and reference standards to be transferred are, to Seller’s Knowledge, (i) manufactured and handled in accordance with current
Good Manufacturing Practice (cGMP), and (ii) accompanied by available batch records, Certificates of Analysis (CoAs) and stability data in Seller’s possession or control.
Section 2.9 Litigation. There is no action, suit, claim, proceeding or investigation (collectively, the “Actions”) pending or, to Seller’s Knowledge, threatened in writing against Seller or, to Seller’s Knowledge, any predecessor in interest to Seller, before or by any Governmental Authority against, relating to or affecting the Purchased Assets or seeking to prevent Seller’s performance of this Agreement and the transactions contemplated hereby.
Section 2.10 Compliance with Law. Seller has conducted its business as applied to or in connection with the Purchased Assets in compliance in all material respects with Applicable Laws.
Section 2.11 Taxes. There are no material Liens for Taxes on any of the Purchased Assets (other than Permitted Liens) and there are no Taxes of Seller related to the Purchased Assets which could become liabilities of Buyer. None of the Purchased Assets constitutes a “United States real property interest” for federal income tax purposes.
Article III.REPRESENTATIONS AND WARRANTIES OF BUYER
Section 3.1 Organization, Standing and Authority. Buyer is a corporation duly organized, validly existing and in good standing under the laws of Canada. Buyer has all necessary corporate power and authority to enter into this Agreement and to perform its obligations hereunder.
Section 3.2 Consents and Authorization. No consent, waiver, approval, order or authorization of, or registration, declaration or filing with, or notice to any Governmental Authority is required by, or with respect to, Buyer in connection with the execution and delivery of this Agreement or the consummation of the transactions contemplated hereby, except for any notice filings or registrations of transfer with any Governmental Authority that may be required in connection with the assignment and transfer of the Purchased Assets. All requisite corporate action necessary to authorize the execution, delivery and performance by Buyer of this Agreement has been taken. This Agreement constitutes a valid and binding obligation of Buyer, enforceable against Buyer in accordance with its terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium, arrangement or other similar Applicable Law or equitable principles relating to or limiting creditors’ rights generally.
Section 3.3 Non-Contravention. The execution and delivery of this Agreement by Buyer does not and the consummation of the transactions contemplated hereby by Buyer will not (a) violate any provision of the certificate of incorporation, bylaws or similar governance documents that may be applicable to Buyer, (b) result in the breach (or an event which, with notice or lapse of time or both, would constitute a breach) of any term or provision of, or constitute a default under any material Contract or material arrangement to which Buyer is a party or by which
it is bound, or (c) violate in any material respect any Applicable Law or any judgment, decree, order, regulation or rule of any Governmental Authority to which Buyer is bound or subject.
Section 3.4 Litigation and Claims. There is no Action pending, or to the Knowledge of Buyer, threatened, against Buyer before or by any Governmental Authority which seeks to prevent Buyer’s performance of this Agreement and the transactions contemplated hereby or have a material adverse effect on the ability of Buyer to complete such transactions.
Section 3.5 Proof of Funds. [***]
Section 3.6 Adequacy of Funds. [***]
Article IV.COVENANTS
Section 4.1 Access to Information.
Section 4.2 Obligations of Confidentiality and Non-Use.
Section 4.3 Records and Audits. For as long as Milestone Events are outstanding, Buyer shall keep, and shall cause Seller to keep, records that are necessary to ascertain the Milestone Payments due hereunder. Such records shall be kept for [***], but for no less than [***] years following the end of the Calendar Quarter to which they pertain. For as long as Milestone Events are outstanding, Seller shall, not more than [***], have the right to have an external independent registered public accounting firm of Seller’s choosing inspect Buyer’s records for the purpose of determining the accuracy of Milestone Payments for a period covering the Calendar Quarter to which they pertain and the [***] calendar years prior to the Calendar Quarter to which they pertain. No period shall be audited more than once and each audit must be reasonable in scope. Such auditors shall keep confidential any information obtained during such inspection and shall report to Seller and Buyer only the amounts of payments due and payable. Such audits may be exercised during normal business hours upon reasonable prior written notice to Buyer. Seller shall bear the full cost of any such audit unless such audit discloses Buyer’s failure to make a Milestone Payment otherwise due under this Agreement, in which case, Buyer shall bear the full cost of such audit and shall remit to Seller, in accordance with this Agreement, the outstanding payment within [***] Business Days of the date the auditors’ written report is received by Buyer.
Section 4.4 Buyer Diligence. Except as set forth in the Exclusive License, after the Closing, Buyer shall have sole decision-making authority over the development, registration, manufacture, commercialization and other Exploitation of the Products; provided that Buyer shall, and shall cause its Affiliates, licensees, and sublicensees, as applicable, to, use Commercially Reasonable Efforts to develop, obtain Marketing Approval of, manufacture and commercialize at least one Product worldwide, including in the United States, the European Union and Asia.
Section 4.5 Further Assurances; Consents.
Section 4.6 Covenant Not to Sue. To Seller’s Knowledge, the Purchased IP constitutes the entirety of the Intellectual Property Rights owned or controlled by Seller that is necessary or reasonably useful to Exploit the Compounds or Products as of the Closing Date. Seller covenants not to, directly or indirectly, bring any demand, claim, lawsuit, or action against Buyer, its Affiliates, licensees, sublicensees as well as their successors or assigns, and their respective
subcontractors, suppliers, resellers, distributors, agents or users alleging infringement or misappropriation of any Intellectual Property Rights that Seller owns or controls as of the Closing.
Section 4.7 Post-Closing Finalization of Exclusive License. [***].
Article V.INDEMNIFICATION
Section 5.1 Survival of Representations and Warranties and Covenants. The representations, warranties, covenants and agreements of the Parties contained in this Agreement shall survive the Closing for the applicable period set forth in this Section 5.1, and any and all claims and causes of action for indemnification under this Article V arising out of the inaccuracy or breach of any representation, warranty, covenant or agreement of a Party must be made prior to the termination of the applicable survival period. The Parties agree that all of the representations, warranties, covenants and agreements of the Parties contained in this Agreement and any and all claims and causes of action for indemnification under this Article V shall survive as follows:
Section 5.2 Obligation to Indemnify.
Section 5.3 Indemnification Procedures.
Section 5.4 Subrogation. After any indemnification payment is made to any Indemnified Party pursuant to this Article V (other than by offset), the Indemnifying Party shall, to the extent of such payment, be subrogated to all rights (if any) of the Indemnified Party against any Third Party in connection with the Losses to which such payment relates. Without limiting the generality of the preceding sentence, any Indemnified Party receiving an indemnification payment pursuant to the preceding sentence (other than by offset) shall execute, upon the written request of the Indemnifying Party, any instrument reasonably necessary to evidence such subrogation rights.
Section 5.5 Right of Offset. [***] .
Section 5.6 Insurance Proceeds. The amount of any Losses required to be reimbursed under this Article V sustained by an Indemnified Party shall be reduced by any amount received by such Indemnified Party with respect thereto under any insurance coverage or from any other Person alleged to be responsible therefore (net of any expenses incurred in recovering such monies, any deductible and any increase in premiums as a result of such claim); provided, the amount of such reduction shall not exceed the amount of such Losses; provided, further, the Indemnified Party shall be entitled to seek indemnification pursuant to this Article V for the amount of such Losses net of the amount of such reductions (net of any expenses incurred in recovering such monies, any deductible and any increase in premiums as a result of such claim). The Indemnified Parties shall use commercially reasonable efforts to collect any amounts available under such insurance coverage and from such other Person alleged to have responsibility. If an Indemnified Party receives an amount under insurance coverage or from such other Person with respect to Losses sustained at any time subsequent to any indemnification payment pursuant to this Article V, then such Indemnified Party shall promptly reimburse the applicable Indemnifying Party for any payment made or expense incurred by such Indemnifying Party in connection with providing such indemnification up to such amount received by the Indemnified Party.
Section 5.7 Duty to Mitigate. Each Indemnified Party shall be obligated to use its commercially reasonable efforts to mitigate to the fullest extent reasonably practicable the amount of any Losses for which it is entitled to seek indemnification under this Article V, and the Indemnifying Party shall not be required to make any payment to an Indemnified Party in respect of such Losses to the extent such Losses arise from the failure of the Indemnified Party to comply with the foregoing obligation. All reasonable costs and expenses incurred in connection with such mitigation shall be included as indemnifiable Losses to the extent reasonably incurred in an effort to mitigate an indemnifiable Loss.
Section 5.8 Remedies; Limitations on Indemnity.
Article VI.MISCELLANEOUS
Section 6.1 Definitions. As used in this Agreement, the following terms shall have the following meanings:
Section 6.2 Notices. All notices, requests, demands and other communications which are required or may be given under this Agreement shall be in writing and shall be deemed to have been duly given when received if personally delivered; upon receipt if transmitted by email; the day after it is sent, if sent for next day delivery to a U.S. address by recognized overnight delivery service (e.g., Federal Express); and upon receipt, if sent by certified or registered mail, return receipt requested, as follows:
Section 6.3 Governing Law. This Agreement shall be governed by and construed in accordance with the internal substantive laws of the State of New York as such laws are applied to agreements between residents of the State of New York that are entered into in the State of New York.
Section 6.4 Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.
Section 6.5 Entire Agreement. This Agreement, including the Schedules and Exhibits hereto and the documents referred to herein, embodies the entire agreement and understanding of the Parties hereto in respect of the subject matter contained herein. This Agreement supersedes all prior agreements and understandings between the Parties with respect to such subject matter.
Section 6.6 Amendment and Modification. This Agreement may be amended or modified only by written agreement of the Parties hereto.
Section 6.7 Binding Effect; Benefits. This Agreement shall inure to the benefit of and be binding upon the Parties hereto and their respective successors and assigns; nothing in this Agreement, express or implied, is intended to confer on any Person other than the Parties hereto and their respective successors and assigns any rights, remedies, obligations or liabilities under or by reason of this Agreement.
Section 6.8 Assignability. This Agreement shall not be assignable by any Party hereto without the prior written consent of the other Party except that (a) Buyer may assign its rights and obligations under this Agreement to any Affiliate of Buyer without the prior written consent of Seller, provided that such assignee continues to be an Affiliate of Buyer; (b) Seller may assign its
rights and obligations hereunder to any acquiror of all or substantially all of the assets of Seller, including an assignment by operation of law, without the prior written consent of Buyer; and (c) Seller may assign any or all of its right to receive payments hereunder without the prior written consent of Buyer.
Section 6.9 Interpretation Provisions.
Section 6.10 Severability. Whenever possible, each provision or portion of any provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision or portion of any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability shall not affect the validity, legality or enforceability of any other provision or portion of any provision in such jurisdiction.
Section 6.11 Obligations of Party’s Affiliates. Each Party shall cause its Affiliates that are entities to perform any obligations of such Party and its Affiliates that are entities in connection with the Purchased Assets and the consummation of the transactions contemplated by this Agreement.