Share Purchase Agreement (2006)Full Document 

Start of Preview
                            SHARE PURCHASE AGREEMENT
              (FOR THE PURCHASE OF SHARES FROM MMV FINANCIAL INC.)

          THIS AGREEMENT is made as of the 18th day of November, 2005,

BETWEEN:

               MMV FINANCIAL INC., a corporation incorporated under the laws of
               Canada

               (the "VENDOR")

               - and -

               VERNALIS PLC, a corporation incorporated under the laws of
               England and Wales, with company number 2304992

               ("VERNALIS")

               - and -

               VERNALIS (CANADA) INC., a corporation incorporated under the laws
               of New Brunswick

               (the "PURCHASER")

RECITALS:

A.   Certain holders of warrants, conversion rights and options to acquire Class
     A Preference Shares, Class D Preference Shares and common shares (the
     "PRINCIPAL SHAREHOLDERS") in the capital of Cita Neuropharmaceuticals Inc.
     (the "CORPORATION"), the Purchaser, Vernalis and the Corporation have
     entered into a share purchase agreement (the "PRINCIPAL PURCHASE
     AGREEMENT") dated the date hereof whereby the Principal Shareholders have
     agreed to sell to the Purchaser all of their shares in the capital of the
     Corporation, including those issuable upon exercise of warrants, conversion
     rights, options and other rights to acquire shares in the capital of the
     Corporation, or to exchange certain options and other rights to acquire
     shares in the capital of the Corporation (both the shares and options
     being, collectively, the "PRINCIPAL SHAREHOLDERS' SECURITIES").



B.   The Vendor wishes to sell all of its Class A Preference shares in the
     capital of the Corporation issuable upon exercise of warrants (the
     "PURCHASED SHARES") and the Purchaser wishes to purchase such shares, on
     and subject to the terms and conditions of this Agreement.

C.   The Vendor wishes to appoint VenGrowth to act as its representative with
     respect to certain matters with respect to this Agreement and related
     documents.

D.   The Purchaser is also entering into separate agreements with other holders
     of shares in the capital of the Corporation and holders of warrants,
     conversion rights, options or rights to acquire shares in the capital of
     the Corporation to acquire all such shares and/or rights.

          NOW THEREFORE in consideration of the mutual covenants and agreements
contained in this Agreement and other good and valuable consideration (the
receipt and sufficiency of which are hereby acknowledged), the parties hereto
agree as follows:

                                    ARTICLE 1
                                 INTERPRETATION

1.1  DEFINITIONS

          In this Agreement,

     1.1.1 "AFFILIATE" has the meaning attributed to such term under the
     Business Corporations Act (Ontario);

     1.1.2 "AGREED PAIN PROJECT BUDGET" means the budget for the Pain Project
     agreed between the Corporation and the Purchaser;

     1.1.3 "AGREED PARKINSON'S PROJECT BUDGET" means the budget for the
     Parkinson's Project agreed between the Corporation and the Purchaser;

     1.1.4 "AGREEMENT" means this agreement and all schedules attached to this
     agreement, in each case as they may be amended or supplemented from time to
     time, and the expressions "HEREOF", "HEREIN", "HERETO", "HEREUNDER",
     "HEREBY" and similar expressions refer to this agreement; and unless
     otherwise indicated, references to Articles and sections are to Articles
     and sections in this agreement;

     1.1.5 "ALZHEIMER'S PROJECT" means the Business which relates to CNP1061 for
     the indication of Alzheimer's disease;

     1.1.6 "API INVENTORY AMOUNT" means the aggregate purchase price of
     specified inventory acquired in respect of the Pain Project and the
     Parkinson's Project, as set out in the Principal Purchase Agreement;


                                      -2-



     1.1.7 "BUSINESS" means the business of the Corporation of researching,
     developing and testing drug candidates related to the Pain Project, the
     Parkinson's Project and the Alzheimer's Project;

     1.1.8 "BUSINESS DAY" means any day, other than Saturday, Sunday or any
     statutory holiday in the Province of Ontario or London, England;

     1.1.9 "CANADIAN DOLLARS", "CDN. DOLLARS" or "CDN.$" means lawful currency
     of Canada;

     1.1.10 "CHARGE" means any security interest, lien, charge, pledge,
     encumbrance, mortgage, adverse claim or title retention agreement of any
     nature or kind;

     1.1.11 "CLASS 2 PREFERRED SHARES" means the Class 2 non-voting,
     retractable, redeemable, preferred shares, in registered form, of the
     Purchaser, having the share provisions set out in Schedule C and subject to
     the prior redemption right of the Class 1 non-voting, retractable,
     redeemable, preferred shares, in registered form, of the Purchaser, with a
     stated redemption price of U.S.$1.00 per share and with an aggregate
     Redemption Price as set out in the Final Proceeds Schedule, plus the
     aggregate Redemption Price of any additional Class 2 Preferred Shares
     issued in accordance with section 2.7.2 and to other Persons in respect of
     Net Cash, and subject to further reduction and set-off in accordance with
     section 2.4.7 and the share provisions attached to the Purchaser Shares;

     1.1.12 "CLASS 3 PREFERRED SHARES" means the Class 3 non-voting,
     retractable, redeemable, preferred shares, in registered form, of the
     Purchaser, having the share provisions set out in Schedule C and subject to
     the prior redemption right of the Class 1 non-voting, retractable,
     redeemable, preferred shares, in registered form, of the Purchaser and the
     Class 2 Preferred Shares, with a stated redemption price of U.S.$1.00 per
     share and with an aggregate Redemption Price as set out in the Final
     Proceeds Schedule, plus the aggregate Redemption Price of any additional

End of Preview