Feasibility Study Agreement
EXHIBIT
10.4
Confidential
Treatment
This
feasibility Study Agreement (“Agreement”) is entered into this 18th day of June,
2007 (Effective Date”), by and between Applied DNA Sciences, Inc. a Nevada
corporation with its principal place of business at 00 Xxxxxx Xxxxxxxx Xx,
Xxxxx
Xxxxx XX 00000 (“ADNAS”) and Supima, a promotional organization of America Pima
cotton growers with its principal place of business at 000 X. 00xx
Xx.,
Xxxxx 00-X, Xxx Xxxx XX 00000-0000 (“Supima”)
Whereas,
ADNAS and Supima has agreed on the principal protocol for the feasibility study
as outlined above in the document titled: U.S. Pima Cotton Fiber Authentication
Program except for the following additions and exceptions:
| 1) |
IP
ownership remains solely with ADNAS. All inventions developed as
a result
of this feasibility study during the Initial Feasibility Study period
or
any extensions thereof will be owned solely by
ADNAS..
|
| 2) |
Supima
maintains a right of first refusal to purchase the IP in the event
that
ADNAS or its successors ceased to exist or offered the IP for sale.
Any
offer to purchase the IP must meet or exceed the value of other purchase
offers received by ADNAS. Supima will have 30 business days to close
on
the IP purchase after it has been notified by ADNAS of any intention
to
sell the IP to a specific buyer.
|
| 3) |
ADNAS
agrees to a **% revenue-sharing rate with Supima for all authentication
services relating to Pima cotton and purchased by any of the member
companies of Supima. Prices for authentication can not be determined
until
the methodology is finalized. Prices will be volume-dependent. Prices
are
guarantied not to exceed $** per level 3 forensic authentication
(CE
sequencing) and $** per level 2 forensic authentication (Real Time
PCR)
for a period of five years starting on June 18, 2007 and ending on
June
17, 2012. Notwithstanding the language in this Section 3, Supima
shall have access to all authentication services relating to Pima
cotton
at a price equal to or lower than the price of such services rendered
to
any member or non-member company of
Supima.
|
| 4) |
ADNAS
agrees to a **% revenue-sharing rate with Supima for all authentication
services relating to non-Supima member companies and to non-Pima
cotton.
Prices for authentication can not be determined until the methodology
is
finalized. Prices will be volume-dependent.
|
| 5) |
Supima
maintains a right of first refusal to fund feasibility studies in
non-Pima
cotton to be performed by ADNAS. Supima’s offer to fund must be made
within 30 business days after ADNAS notifies Supima of alternative
offers
to fund feasilbility studies to develop primers that would allow
confirmation of the specific cotton cultivar used to create a textile.
|
Confidential
Treatment
| 6) |
ADNAS
agrees to refund 50% of the total research expenditure to Supima
as a
bonus to the revenue sharing on future authentication service revenue.
This bonus would survive for up to 5
years.
|
| a) |
ADNAS
will pay Supima $** of the revenue (above the **% revenue sharing)
per
authentication service to Supima until the earlier of either:
|
| i) |
5
years, or,
|
| ii) |
until
ADNAS has refunded 50% of the total research expenditure.
|
| b) |
At
the end of five years, or once 50% of the research expenditure has
been
refunded, the revenue-sharing rate to Supima would continue to be
**% of
its members authentication purchases for pima cotton.
|
| 7) |
Payment
Schedule is modified as follows:
|
| a) |
$**.
upon signing of this agreement
(non-refundable)
|
| b) |
$**.
due and payable on the 6th
day of July, 2007 (non-refundable)
|
| c) |
A
total of four equal payments of $**. will be received by APDN on
the
6th
day of each of the 4 success months (Aug, Sept, Oct, Nov). The total
research program is $250,000.
|
| 8) |
This
agreement can be cancelled after sixty (60) days by notifying the
other
party in writing 14 days in advance Any notice or other communication
required or permitted by this Agreement to be given to a party shall
be in
writing and shall be deemed given if delivered personally or by commercial
messenger or courier service, or mailed by U.S. registered or certified
mail (return receipt requested), or sent via facsimile (with receipt
of
confirmation of complete transmission) to the party at the party’s address
or facsimile number written below or at such other address or facsimile
number as the party may have previously specified by like
notice.
|
If
to
ADNAS to:
Applied
DNA Sciences, Inc.
00
Xxxxxx
Xxxxxxxx Xxxxx, Xxxxx 000
Xxxxx
Xxxxx, Xxx Xxxx 00000
Attention:
Xxxx Xxxxxx
Telephone:
(000) 000-0000
Facsimile:
(000) 000-0000
If
to
Supima, to the address for notice on the signature page to this Agreement.
| 9) |
The
first two (2) months feasibility study is limited to the Genetic
Study as
set forth under Phase I section A (d). The X-Ray study will commence
in
month 3.
|
| 10) |
The
Feasibility Study Time schedule is provided as a general guideline
and
will not commence before ADNAS receives the cultivars that are to
be
provided by Supima.
|
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| 11) |
CONFIDENTIALITY.
|
| a) |
The
Parties recognize that each party shall disclose to the other information
concerning suppliers, clients, distributors, agents, brokers, buyers,
sellers, technical data, performance data, pricing details, formulas,
processes, commissions, discounts, information relating to competitors
and
other information which the parties have acquired through their investment
of time, expense and effort and which may constitute confidential
proprietary business information, intellectual property, and/or trade
secrets. The parties acknowledge and agree that during the term of
this
Agreement, and in the course of the discharge of the duties hereunder,
the
parties shall have access to and become acquainted with information
concerning the operation of the other party, including, financial,
personnel, sales, manufacturing, buying, planning, and other information
owned by and regularly used in the operation of the business of each
party
and each party shall also receive information of a proprietary nature
regarding the constitution, formulation, pricing and effectiveness
of the
Products and both parties hereto accept that such information as
outlined
above constitutes the Confidential Information of the providing
party.
|
| b) |
As
used herein, “Confidential Information” of a party means all trade secret,
proprietary and confidential information and materials, in any form
whatever, relating to such party’s technologies, compounds, research
programs, operations or financial or business condition (including,
without limitation, know-how, data, drawings, designs, specifications,
formulations, processes, methods, equipment, software and pricing
information) that is (i) disclosed in writing and marked as
“Confidential”, “Proprietary” or with similar words, or (ii) orally
or visually disclosed and identified as confidential or proprietary
at the
time of disclosure and confirmed as such in writing within thirty
(30)
days thereafter.
|
| c) |
Notwithstanding
Section 11A or 11B above, “Confidential Information” of a party shall not
include any information or materials
that:
|
| i) |
are
approved for release by that party in writing without
restriction;
|
| ii) |
are
demonstrated by written records of the receiving party as being previously
known to it other than through a prior disclosure by the disclosing
party
or by any third party with an obligation of confidentiality to the
disclosing party;
|
| iii) |
are
publicly known as of the date of this Agreement, or become public
knowledge subsequent thereto, through no act or omission of the party
receiving the information or any third party with an obligation of
confidentiality to such party;
|
| iv) |
are
obtained by the receiving party in good faith from a third party
without
the violation of any obligation of confidentiality to such party
by either
the receiving party or such third party;
or
|
| v) |
are
independently developed by or on behalf of the receiving party without
the
benefit of such party’s Confidential Information, as shown by competent
written records.
|
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| 12) |
CHOICE
OF LAW AND JURISDICTION. This Agreement and all amendments, modifications,
alterations or supplements hereto, and the rights of all Parties
hereunder, shall be construed under and governed by the laws of the
State
of New York, U.S.A. (without regard to its laws regarding choice
of law)
and the United States of America. Only federal or state courts located
in
the State of New York, U.S.A. shall have jurisdiction to hear and
decide
any controversy or claim between the Parties arising under or relating
to
this Agreement.
|
| 13) |
ARBITRATION.
Any
disputes, controversies or claims arising out of this Agreement shall
be
resolved through arbitration conducted under the auspices of the
American
Arbitration Association pursuant to that organization’s rules for
commercial arbitration.
|
| 14) |
COMPLETE
AGREEMENT. This Agreement constitutes the complete and exclusive
statement
of understanding among the Parties. It supersedes all prior written
or
oral statements, including any prior representation, statement, condition,
or warranty, except as expressly provided otherwise herein. This
Agreement
may not be amended without the written consent of all of the Parties
and
represents a final agreement of the parties. No change or modification
of
this Agreement shall be valid unless the same be in writing and signed
by
all parties hereto and attached hereto as a supplement and made an
integral part of this Agreement.
|
| 15) |
IN
WITNESS WHEREOF, each of the Parties below has caused this Agreement
to be
executed by its duly authorized representatives as of the date
hereof,
|
For
ADNAS
by:
______________________
Name:
Xxxxx X. Xxxxxxx
Title:
CEO
For
SUPIMA by:
______________________
Name:
Title:
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