LICENSE AGREEMENT
Exhibit 10.2
THIS LICENSE AGREEMENT (this “Agreement”) is made and is effective as of June 8, 2004, (the
“Effective Date”) between SynthRx, Inc. a Delaware corporation (“SynthRx”) and CytRx
Corporation, a Delaware corporation (“CytRx”) with reference to the following facts:
A. CytRx has developed CytRx Know-How (as hereinafter defined) and has CytRx Patent Rights
(as hereinafter defined) in the fields of:
(i) the composition and use of surface-active copolymers exemplified by poloxamer 188 to treat
ischemic or damaged tissue, myocardial damage, stroke, pathological hydrophobic interactions in
biological fluids, tissue damaged by reperfusion injury, sickle cell disease, cancer and in
performing angioplasty procedures (with the CytRx Know-How and CytRx Patent Rights in this field
referred to collectively as the “FLOCOR Intellectual Property”);
(ii) the composition and use of surface active copolymers (exemplified by poloxamers, reverse
poloxamers and diether, diester or diamide fatty acid conjugates of poloxyethylene) to treat
infections caused by microorganisms, including bacteria, fungi, and viruses and to treat tumors
(with the CytRx Know-How and CytRx Patent Rights in this field referred to collectively as the
“Anti-Infectives Intellectual Property”); and
(iii) conventional vaccine adjuvants exemplified by poloxamer P1005 (with the CytRx Know-How
and CytRx Patent Rights in this field referred to collectively as the “OptiVax Intellectual
Property”).
B. CytRx has exclusively licensed to Merck & Co. (“Merck), Ivy Animal Health, Inc. (“Ivy
Animal Health”), TiterMax USA, Inc. (“TiterMax”) and Vical Inc. (“Vical”) and has granted an
option to acquire an exclusive license to Progenies Pharmaceuticals, Inc. (“Progenies”), CytRx
Know-How and CytRx Patent Rights in certain fields under agreements collectively referred to as
the CytRx Licenses, copies of which are attached hereto as Schedule A.
C. Xx. Xxxxxx X. Xxxxxx (“Xxxxxx”) has previously participated in the development of most
of the poloxamer technology that is the subject of the Licensed Intellectual Property (as
hereinafter defined) and has developed Hunter Know-How (as hereinafter defined) and has no
Hunter Patent Rights (as hereinafter defined).
D. CytRx and SynthRx wish to continue the development and subsequent commercialization of
the FLOCOR Intellectual Property, the Anti-Infectives Intellectual Property and the OptiVax
Intellectual Property (collectively referred to as the “Licensed Intellectual Property”)
pursuant to a license to the Licensed Intellectual Property to be granted by CytRx to SynthRx
and upon the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing premises and the mutual covenants herein
contained, the parties hereby agree as follows:
| *** | Certain confidential portions of this Exhibit were omitted by means of blackout of the text (the “Xxxx”). This Exhibit has been filed separately with the Secretary of the Commission without the Xxxx pursuant to the Company’s Application Requesting Confidential Treatment under Rule 24b-2 under the 1934 Act. |
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ARTICLE I.
DEFINITIONS
DEFINITIONS
Unless specifically set forth to the contrary herein, the following terms, whether used in
the singular or plural, shall have the respective meanings set forth below:
1.1 The term “Affiliate” shall mean (i) any corporation or business entity of which 50% or
more of the securities or other ownership interests representing the equity, the voting stock or
general partnership interest are owned, controlled or held, directly or indirectly, by SynthRx,
Hunter or CytRx; or (ii) any corporation or business entity which, directly or indirectly, owns,
controls or holds 50% or more of the securities or other ownership interests representing the
equity or the voting stock of SynthRx or CytRx.
1.2 The term “Anti-Infectives” shall mean polyoxypropylene/polyoxyethylene copolymers and
other polyoxyethylene conjugates having therapeutic activity or having the ability to enhance the
therapeutic activity of other agents against infective organisms, including bacteria, viruses and
fungi.
1.3 The term “Calendar Quarter” shall mean the respective periods of three consecutive
calendar months ending on March 31, June 30, September 30 and December 31.
1.4 The term “Calendar Year” shall mean each successive period of twelve consecutive calendar
months commencing on January 1 and ending on December 31.
1.5 The term “CytRx Know-How” shall mean information and materials, including but not limited
to, discoveries, Improvements, processes, formulas, data, know-how and trade secrets, patentable or
otherwise, which (i) are in CytRx’s possession or control at the Effective Date or are developed by
CytRx during the term of this Agreement, if any, (ii) are not generally known, (iii) are necessary
to SynthRx in connection with the research, development, marketing, use or sale of Licensed
Products in the Field in the Territory, and (iv) CytRx has the right to provide to SynthRx.
1.6 The term “CytRx Licenses” shall mean the previously entered into exclusive license
agreements between CytRx and Merck, Ivy Animal Health, TiterMax and Vical and the exclusive license
agreement to be entered into between CytRx and Progenies upon Progenies exercising the option
granted to h by CytRx for certain CytRx Know-How and CytRx Patent Rights for certain fields as
defined in each license agreement listed in Schedule A.
1.7 The term “CytRx Patent Rights” shall mean (i) all United States or foreign patents or
patent applications, and patents to be issued pursuant thereto, owned by or licensed to CytRx,
pertaining to Flocor, the Anti-Infectives or Optivax, excluding the use in certain fields that are
covered in the CytRx Licenses listed in Schedule A hereto; or (ii) are divisions, continuations,
reissues, renewals, extensions, supplementary protection certificates, utility models and the like
of any such United States patents and patent applications and foreign equivalents thereof.
1.8 The term “Field” shall mean the use of Licensed Intellectual Property in all fields for
FLOCOR, Anti-Infectives and OptiVax Agreements, except for those fields of use that are or will be
licensed under the CytRx Licenses set forth in recital A to this Agreement.
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1.9 The term “FLOCOR” shall mean surface-active copolymers of an ethylene oxide-propylene
oxide condensation products that have cytoprotective, rheologic and antithrombotic activities
exemplified by poloxamer 188.
1.10 The term “Hunter Know-How” shall mean information and materials, including but not
limited to, discoveries, Improvements, processes, formulas, dates, know-how and trade secrets,
patentable or otherwise, which are in Hunter’s possession or control at the Effective Date or are
developed by Hunter alone or with others during the term of this Agreement, if any, (i) are not
generally known, (ii) are necessary to SynthRx in connection with the research, development,
marketing, use or sale of the Licensed Products in the Field in the Territory, and (iii) which
Hunter has the right to provide to SynthRx.
1.11 The term “Hunter Patent Rights” shall mean (i) all United States or foreign patents or
patent applications and patents to be issued pursuant thereto, owned by or licensed to Hunter,
including but not limited to those listed in Schedule B hereto; or (ii) are divisions,
continuations, reissues, renewals, extensions, supplementary protection certificates, utility
models and the like of any such United States patents and patent applications and foreign
equivalents thereof in die fields of FLOCOR, the Anti-lnfectives and OptiVax.
1.12 The term “Improvement” shall mean any improvement or enhancement by SynthRx, CytRx or
Hunter to any of the Licensed Intellectual Property, including without limitation in the synthesis,
purification or manufacture of FLOCOR, OptiVax or the Anti-lnfectives.
1.13 The term “Licensed Product” shall mean a Product for use in the Field, that in the
absence of this Agreement would infringe one or more claims of the CytRx Patent Rights or Hunter
Patent Rights, or a Product that is made using a process or method covered by one or more claims of
the CytRx Patent Rights or Hunter Patent Rights.
1.14 The term “Major Market Country” shall mean the United States, Japan or one half of the
countries of the European Union.
1.15 The term “Net Sales” shall mean with respect to any Licensed Product, the gross sales
price of such Licensed Product invoiced by SynthRx or Affiliates to customers who are not
Affiliates (or are Affiliates but are end users of such Licensed Product) less, to the extent
actually paid or accrued by SynthRx or Affiliates (as applicable), (a) normal and customary
credits, allowances, discounts and rebates to, and chargebacks from the account of such customers
for spoiled, damaged, out-dated or returned Licensed Product; (b) normal and customary outer
packing, freight and insurance costs incurred in transporting such Licensed Product to such
customers; (c) normal and customary cash, quantity and trade discounts, rebates and other price
reductions for such Licensed Product given to such customers; (d) sales, use, excise, value-added
and other taxes (but not income taxes of any kind) imposed upon the sale of such Licensed Product
in final form to such customers; and (e) customs duties, surcharges and other governmental charges
incurred in exporting or importing such Licensed Product to such customers.
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In the case of a Combination Product, as defined below, for which the agent or ingredient
constituting a Licensed Product and each of the other active agents or active ingredients not
constituting a Licensed Product have established market prices when sold separately, Net Sales
shall be determined by multiplying the Net Sales for each such Combination Product by a fraction,
the numerator of which shall be the established market price for the Licensed Product contained in
the Combination Product and the denominator of which shall be the sum of the established market
prices for the Licensed Product plus the other active agents or active ingredients contained in the
Combination Product. When such separate market prices are not established, then the parties shall
negotiate in good faith to determine a fair and equitable method of calculating Net Sales for the
Combination Product in question. For purposes of the foregoing, “Combination Product” shall mean
any product containing both an agent or ingredient, which constitutes a Licensed Product and one or
more other active agents which do not by themselves constitute Licensed Products, whether such
Combination Product is packaged separately but sold together or are both packaged and sold
together.
1.16 The term “OptiVax” shall mean novel polyoxyethylene/polyoxypropylene copolymers that are
high molecular weight molecules and are useful as vaccine adjuvants.
1.17 The term “Organization Agreement”, shall mean the Agreement dated as of October 20,2003,
by and among CytRx, SynthRx and Hunter.
1.18 The term “Phase I Clinical Trial” shall mean that portion of the clinical development
program, which includes one or more trials of a Licensed Product on human patients to estimate
initial safety and tolerability for the desired claims and indications.
1.19 The term “Phase II Clinical Trial” shall mean that portion of the clinical development
program conducted after the completion of the required Phase I Clinical Trials and which includes
one or more human clinical trials, which trials are intended to evaluate the safety and
effectiveness of a Licensed Product for a particular indication or indications in patients with the
disease or indication under study or that would otherwise satisfy the requirements of 21 CFR
312.21(b), any future revisions thereof, any future substitutes therefor, or foreign equivalents
thereof.
1.20 The term “Phase III Clinical Trial” shall mean that portion of the clinical development
program which includes one or more human clinical trials, the results of which could be used to
establish the safety and efficacy of a Licensed Product as a basis for a NDA or that would
otherwise satisfy requirements of 21 CFR 312.21(c), any future revisions thereof, any future
substitutes therefor, or foreign equivalents thereof.
1.21 The term “Product” shall mean any prescription or over-the-counter prophylactic,
diagnostic or therapeutic product, vaccine or medical device for use in the Field in the Territory.
1.22 The term “Proprietary Information” shall mean all SynthRx Know-How, Hunter Know-How and
CytRx Know-How, and all other scientific, clinical, regulatory, marketing, financial and commercial
information or data, whether communicated in writing or orally or by sensory detection, which is
provided by one party to the other party in connection with this Agreement.
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1.23 The term “Regulatory Approval” shall mean notification from the United States Food and
Drug Administration or a comparable regulatory authority in a country that all approvals for the
marketing of a Licensed Product, including pricing approvals, have been granted.
1.24 The term “SynthRx Know-How” shall mean any SynthRx information and materials, including
but not limited to, discoveries, Improvements, processes, formulas, data, inventions, know-how and
trade secrets, patentable or otherwise, which during the term of this Agreement are not generally
known.
1.25 The term “Territory” shall mean all of the countries in the world.
1.26 The term “separately branded Licensed Products” shall mean two or more Licensed Products
that are not interchangeable. It does not include different dosage forms, modified labeling or
different names used in conjunction with different languages.
ARTICLE II.
LICENSE: DEVELOPMENT AND COMMERCIALIZATION
LICENSE: DEVELOPMENT AND COMMERCIALIZATION
2.1 SynthRx License Grant. CytRx hereby grants to SynthRx effective as of the
Effective Date an exclusive license to CytRx Patent Rights in the Territory with the right to
sublicense the Licensed Intellectual Property to research, develop, use, manufacture, have
manufactured, sell, offer to sell or have sold (i) Licensed Products; and (ii) OptiVax as it
relates to use in the Field.
2.2 Exchange of Information; Supply of Material.
(a) Initial Data Transfer. CytRx shall make available to SynthRx on or prior to the
Closing Date in English and in writing for its use, CytRx Know-How in CytRx’s possession as of the
Closing Date (as defined in the Organization Agreement), including but not limited to the
embodiments of such CytRx Know-How as set forth on the attached Schedule C. CytRx also agrees to
disclose to SynthRx, upon execution of this Agreement CytRx’s pending United States patent
applications, if any. CytRx shall also transfer to SynthRx within 60 days of the Closing Date
copies of all regulatory filings (including without limitation IND’s) and data pertaining to
FLOCOR, OptiVax and CytRx’s Anti-Infectives patent portfolio.
(b) Additional Date Transfer. During the term of this Agreement and so long as
SynthRx continues to have an obligation to pay royalties to CytRx under this Agreement, CytRx shall
promptly disclose to SynthRx in writing on an ongoing basis all CytRx Know-How not previously
disclosed.
(c) Reports. During the term of tins Agreement, and upon written request from CytRx,
but not more than once per Calendar Year, SynthRx agrees to provide CytRx with a written report
summarizing research and development activities related to the Licensed Intellectual Property over
the previous Calendar Year.
(d) Sublicense Agreements. SynthRx shall provide to CytRx a copy of all sublicense
agreements pertaining to Licensed Intellectual Property within 30 days of execution.
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(e) Supply of Flocor and other drug product. CytRx shall assign ownership to SynthRx
on or before the Second Closing Date (as defined in the Organization Agreement) of all of its drug
product relating to OptiVax, the Anti-Infectives and FLOCOR, including FLOCOR finished drug
product, work in progress drug product and drug substance in accordance with the provisions of the
Organization Agreement but makes no representation or warranty as to the physical condition or
usability in future clinical trials of any of these drug materials.
2.3 Development and Commercialization. SynthRx shall use its commercially reasonable
best efforts at its own expense, to develop and commercialize Licensed Products in the Territory
and to maximize the sales of Licensed Products. SynthRx shall provide CytRx with summaries of all
of its development plans for Licensed Products as well as copies of all material correspondence
with the FDA and other foreign regulatory authorities with respect to the development, manufacture
and sale of Licensed Products.
ARTICLE III.
CONFIDENTIALITY AND PUBLICATION
CONFIDENTIALITY AND PUBLICATION
3.1 Nondisclosure Obligation. All Proprietary Information disclosed by a disclosing
party to a receiving party hereunder shall be maintained in confidence by the receiving party and
shall not be disclosed to a non-party or used for any purpose except as set forth herein without
the prior written consent of the disclosing party, except to the extent that such Proprietary
Information:
(a) is known by recipient at the time of its receipt, and not through a prior disclosure by
the disclosing party, as documented by business records;
(b) is properly in the public domain;
(c) is subsequently disclosed to the receiving party by a third party who may lawfully do so
and is not under an obligation of confidentiality to the disclosing party;
(d) is developed by the receiving party independently of Proprietary Information received from
the disclosing party as documented by business records;
(e) is disclosed to governmental or other regulatory agencies in order to obtain patents or to
gain approval to conduct clinical trials or to market Licensed Product, but such disclosure may be
only to the extent reasonably necessary to obtain patents or authorizations upon prior review and
consent of the disclosing party;
(f) is deemed necessary by SynthRx to be disclosed to sublicensees, agents, consultants,
Affiliates, distributors and/or other third parties for the research and development, manufacture,
use sale or offer for sale of Licensed Products (or for such parties to determine their interest in
performing such activities) in accordance with this Agreement on the condition that such third
parties agree to be bound by the confidentiality obligations contained in this Agreement, provided
the term of confidentiality for such third parties shall be no less than ten (10) years; or
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(g) is required to be disclosed by law or court order, provided that notice is promptly
delivered to the other party in order to provide an opportunity to challenge or limit the
disclosure obligations.
ARTICLE IV.
PAYMENTS: ROYALTIES AND REPORTS
PAYMENTS: ROYALTIES AND REPORTS
4.1 Initial Payment. In partial consideration for the license granted pursuant to
Section 2.1 hereof under the Licensed Intellectual Property, upon the terms and conditions
contained herein, SynthRx shall pay to CytRx on the Effective Date the CytRx cash license payment
provided for by Section 2.2 of the Organization Agreement. This cash payment shall be
non-refundable and not creditable against the royalty or other payments called for by Section 4.2
or Section 4.3 hereof
4.2 Milestone Payments. Subject to the terms and conditions in this Agreement and as
further consideration for the license granted herein, SynthRx shall pay to CytRx the following
milestone payments, which shall be non-refundable and not creditable against the royalty called for
under Section 4.3 hereof:
(a) With respect to the development of Licensed Products being developed by SynthRx or an
affiliate based on FLOCOR Intellectual Property:
(i) A $2,000,000 payment for the first Major Market Country upon obtaining Regulatory Approval
and first commercial sale due to such approval in that country.
(ii) For each additional separately branded License Product:
A $2,000,000 payment for the first Major Market Country in which a Regulatory Approval is
obtained, upon the securing the first commercial sale due to such approval.
(b) With respect to the development of Licensed Products being developed by SynthRx or an
affiliate based on Anti-Infectives Intellectual Property:
(i) A $2,000,000 payment for the first Major Market Country in which Regulatory Approval is
obtained, upon the securing the first commercial sale due to such approval.
(ii) For each additional separately branded Licensed Product:
A $2,000,000 payment for the first Major Market Country in which a Regulatory Approval is
obtained, upon the securing the first commercial sale due to such approval.
Except as otherwise provided above, SynthRx shall notify CytRx in writing within 30 days upon the
achievement of each milestone. Payment shall be divided and spread over time, as follows: $1
million will be due on market introduction; the remaining $1 million will be payable over time
at a rate of 25% of net sales quarterly as set forth in the reports described in Section 4.3.3
hereof until the total amount specified is paid.
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4.3 Royalties.
4.3.1 Royalties Payable By SvnthRx. Subject to the terms and conditions of this
Agreement, SynthRx shall pay to CytRx royalties for sales by SynthRx or an affiliate of Licensed
Product on a country-by-country basis in an amount equal to:
(a) Subject to Paragraph 4.3.1 (b) below, for Net Sales by SynthRx or Affiliates of
Licensed Products sold:
(i) under the license to FLOCOR Intellectual Property granted under Section 2.1(a)
hereof a royalty of 5%;
(ii) under the license for Anti-Infectives Intellectual Property granted under Section
2.1(a) hereof a royalty of 5%; and
(iii) under the license for OptiVax Intellectual Property granted under Section 2.1(a)
hereof, a royalty of 4%.
(b) If in any country, the total royalty payments on a Licensed Product (including
royalties payable to CytRx) being paid by SynthRx or its Affiliates exceeds double the
royalty obligation to CytRx, the royalty to CytRx for such country shall be reduced by the
formula set forth below, provided that in no event shall the royalty payable to CytRx be
reduced by more than 50% on a country-by-country basis. It is understood that royalty
reductions are intended to be equitably applied to all of SynthRx’s licensors of technology
related to Licensed Products. If SynthRx concludes that a royalty reduction formula is
applicable, SynthRx shall inform CytRx of the total amount of its royalty burden on Licensed
Product. SynthRx represents and warrants that as of the Effective Date, it has no reason to
know that total royalty payments on Licensed Products will exceed 10%.
Formula. The amount payable to CytRx will be the larger of (1) the contracted royalty
to CytRx multiplied by the fraction that is double the total royalty obligation of SynthRx or (2)
50% of the contracted royalty to CytRx.
Example: CytRx royalty is 5% and total royalty burden on Licensed Product is 30%.
Royalty due CytRx would be as follows: 10%/30% multiplied by 5% . This is
10%/30% * 10% = 3.33%.
(c) Royalties on Licensed Product at the rates set forth in this Section 4.3.1 shall be
effective as of the date of first commercial sale of Licensed Product in a country and shall
continue for the longer of 7 years from the first commercial sale of Licensed Product in that
country or until the expiration of the last applicable patent on Licensed Product in such
country in the case of sales under Subsection 4.3.1 (unless a generic equivalent for Licensed
Product is then being marketed in such country, in which case the royalty rate will be
reduced by 50%) subject to the following conditions.
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(A) that only one royalty shall be due under this Agreement with respect to the each unit of
Licensed Product;
(B) that no royalties shall be due upon the sale or other transfer among SynthRx or its
Affiliates, but in such cases the royalty shall be due and calculated upon SynthRx’s or its
Affiliate’s Net Sales; no royalties shall accrue on the disposition of Licensed Product by SynthRx
or its Affiliates as samples (promotion or otherwise) or as donations (for example, to non-profit
institutions, government agencies for a non-commercial purpose); and
(C) sales of Licensed Product by SynthRx, any Affiliate of SynthRx or any sublicensee or
distributor of SynthRx solely for research or clinical testing or for indigent or similar public
support or compassionate use programs, which sales are made at or below the cost of goods of such
Licensed Product or at or below the cost of purchasing such Licensed Product from a third party
manufacturer if such Licensed Product is so purchased by SynthRx (plus, in each case, the costs of
shipping and administration of such clinical, indigent or compassionate use program) shall be
excluded from the computation of Net Sales.
4.3.2 Royalty Payable Under Managed Pharmaceutical Contract. It is understood by the
parties that SynthRx may sell Licensed Product to an independent third party (such as a retailer or
wholesaler) and may subsequently perform services relating to Licensed Products under a managed
pharmaceutical benefits contract or other similar contract. In such cases, it is agreed by the
Parties that Net Sales shall be based on the invoice price to an independent retailer or
wholesaler, provided that such invoice price represents a fair market price for such Licensed
Products.
4.3.3 Reports: Payment of Royalty. During the term of this Agreement following the
first commercial sale of a Licensed Product, SynthRx shall furnish to CytRx a quarterly written
report for the Calendar Quarter showing the sales of all Licensed Products subject to royalty
payments sold by SynthRx, its Affiliates and its sublicensees in the Territory during the reporting
period and the royalties payable under this Agreement. Reports shall be due on the 45th day
following the close of each Calendar Quarter. Royalties shown to have accrued by each royalty
report shall be due and payable on the date such royalty report is due. SynthRx shall keep
complete and accurate records in sufficient detail to enable the royalties payable hereunder to be
determined.
4.3.4 Audits.
(a) Upon the written request of CytRx and not more than once in each Calendar Year, SynthRx
shall permit an independent certified public accounting firm of nationally recognized standing
selected by CytRx and reasonably acceptable to SynthRx, at CytRx’s expense, to have access during
normal business hours to such of the records of SynthRx as may be reasonably necessary to verify
the accuracy of the royalty reports hereunder for any year ending not more than 24 months prior to
the date of such request. The accounting firm shall disclose to CytRx only whether the royalty
reports are correct or incorrect and the specific details concerning any discrepancies. No other
information shall be provided to CytRx.
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(b) If such accounting firm correctly concludes that additional royalties were owed during
such period, SynthRx shall pay the additional royalties within 30 days of the date CytRx delivers
to SynthRx such accounting firm’s written report so correctly concluding, and will also pay the
fees charged by such accounting firm. In addition, if the additional royalties found due exceed 5%
of the amounts paid, the SynthRx will pay CytRx interest on such additional royalties at the rate
of prime rate plus 2% (as published in the Wall Street Journal on the last Friday of the month)
from the date such additional royalties were due to the date such additional royalties are paid.
(c) SynthRx shall include in each sublicense granted by it pursuant to this Agreement a
provision requiring the sublicensee to make reports to SynthRx, to keep and maintain records of
sales made pursuant to such sublicense and to grant access to such records by CytRx’s independent
accountant to die same extent required of SynthRx under this Agreement. Upon the expiration of 24
months following the end of any year, the calculation of royalties payable with respect to such
year shall be binding and conclusive upon CytRx, and SynthRx and its sublicensees shall be
released from any liability or accountability with respect to royalties for such year.
(d) CytRx shall treat all financial information subject to review under this Section 4.3.4 or
under any sublicense agreement in accordance with the confidentiality provisions of this
Agreement, and shall cause its accounting firm to enter into an acceptable confidentiality
agreement with SynthRx obligating it to retain all such financial information in confidence
pursuant to such confidentiality agreement.
4.3.5 Payment Exchange Rate. All payments to be made by SynthRx to CytRx under this
Agreement shall be made in United States dollars and may be paid by check made to the order of
CytRx or bank wire transfer in immediately available funds to such bank account in the United
States designated in writing by CytRx from time to time. In the case of sales outside the United
States, the rate of exchange to be used in computing the amount of currency equivalent in United
States dollars shall be made according to the prevailing rate of exchange on the last business day
of the month in which such sales were recorded as published in the Wall Street Journal.
4.3.6 Income Tax Withholding. If laws, rules or regulations require withholding of
income taxes or other taxes imposed upon payments set forth in this Article IV, SynthRx shall make
such withholding payments as required and subtract such withholding payments from the payments set
forth in this Article IV. SynthRx shall submit appropriate proof of payment of the withholding
taxes to CytRx within a reasonable period of time.
4.3.7 Sublicense Income. If SynthRx elects to sublicense CytRx Patent Rights as
provided for in Section 2.1, then after such sublicense the milestone payments (Section 4.2) and
royalties (Section 4.3) will not apply to any Licensed Product sold by the sublicensee. Instead,
SynthRx shall pay CytRx an amount equal to 20% of any sublicensing income that it receives from any
third party within 30 days after receiving the sublicense payment from the sub licensee, Sublicense
income includes all payments received by SynthRx in consideration of any sublicense of the rights
granted to SynthRx by CytRx pursuant to Section 2.1 hereof, including without limitation, license
fees, royalties, milestone payments, license maintenance fees and strategic alliance payments,
whether in cash, equity or other property, with the payment by SynthRx to CytRx to be in the same
form as the payment received by SynthRx.
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ARTICLE V.
REPRESENTATIONS AND DISCLAIMER OF WARRANTIES
REPRESENTATIONS AND DISCLAIMER OF WARRANTIES
5.1 NOTHING IN THIS AGREEMENT SHALL BE DEEMED TO BE A REPRESENTATION OR WARRANTY BY CYTRX OF
THE VALIDITY OF ANY OF THE PATENTS OR THE ACCURACY, SAFETY, OR USEFULNESS FOR ANY PURPOSE, OF ANY
CYTRX KNOW-HOW AND ANY OTHER TECHNICAL INFORMATION, TECHNIQUES, OR PRACTICES AT ANY TIME MADE
AVAILABLE BY CYTRX, CYTRX SHALL HAVE NO LIABILITY WHATSOEVER TO SYNTHRX OR ANY OTHER PERSON FOR OR
ON ACCOUNT OF ANY INJURY, LOSS, OR DAMAGE, OF ANY KIND OR NATURE, SUSTAINED BY, OR ANY DAMAGE
ASSESSED OR ASSERTED AGAINST, OR ANY OTHER LIABILITY INCURRED BY OR IMPOSED UPON SYNTHRX OR ANY
OTHER PERSON, ARISING OUT OF OR IN CONNECTION WITH OR RESULTING FROM (a) THE PRODUCTION, USE, OR
SALE OF ANY PRODUCT, OR THE PRACTICE OF THE PATENT RIGHTS AND/OR CYTRX KNOW-HOW; (b) THE USE OF ANY
CYTRX KNOW-HOW OR ANY OTHER TECHNICAL INFORMATION, TECHNIQUES, OR PRACTICES DISCLOSED BY CYTRX; OR
(c) ANY ADVERTISING OR OTHER PROMOTIONAL ACTIVITIES BY SYNTHRX WITH RESPECT TO ANY OF THE
FOREGOING.
ARTICLE VI.
INVENTIONS AND PATENT PROVISIONS
INVENTIONS AND PATENT PROVISIONS
6.1 Filing, Prosecution and Maintenance of Patents. SynthRx, at its own expense shall
have primary responsibility for filing, prosecuting, and maintaining any and all CytRx Patent
Rights, including any Improvements to the CytRx Patent Rights. SynthRx shall have the right to
determine whether or not, and where to abandon the prosecution of any patent or patent application,
to discontinue the maintenance of any patent or patent application, or to seek patent term
restoration or supplemental protection certificates or their equivalents in any country in the
Territory where applicable to patents. SynthRx shall provide CytRx with copies of all material
correspondence and filings with the U.S. Patent and Trademark Office and any foreign patent office.
CytRx may, at its own expense, file for or maintain any patent that SynthRx elects to not pursue
or to abandon, in which case such patent shall be excluded from the CytRx Patent Rights that are
licensed to SynthRx. However, some CytRx patents are overlapping, providing multiple layers of
protection. SynthRx may elect to abandon such patents that are deemed not necessary for protection
of the technology. Consequently, if CytRx files for or maintains any patent that SynthRx elects to
not pursue or to abandon, then CytRx agrees not to enforce that patent against any activities of
SynthRx permitted by this Agreement that are protected by patents that SynthRx has elected to
maintain.
6.2 Interference. Opposition. Reexamination and Reissue.
(a) CytRx and SynthRx shall, within ten 10 days of learning of such event, inform the other
party of any request for, or filing or declaration of any interference, opposition, or
reexamination relating to any of the CytRx Patent Rights. SynthRx and CytRx shall thereafter
consult and cooperate fully to determine a course of action with respect to any such proceeding,
with SynthRx having primary responsibility, at its own expense, for implementing such agreed upon
action.
Page 11 of 18
(b) SynthRx shall not institute any reexamination, or reissue proceeding relating to any of
the CytRx Patent Rights without the prior written consent to CytRx, which consent shall not be
unreasonably withheld.
(c) In connection with any interference, opposition, reissue, or reexamination proceeding
relating to any of the CytRx Patent Rights, SynthRx and CytRx will cooperate fully and will
provide each other with any information or assistance that either may reasonably request. SynthRx
shall keep CytRx informed of developments in any such action or proceeding, including, to the
extent permissible, the status of any settlement negotiations and the terms of any offer related
thereto.
6.3 Enforcement Rights.
(a) CytRx and SynthRx shall give each other notice of either (i) any infringement of any of
the CytRx Patent Rights, or (ii) any misappropriation or misuse of CytRx Know-How, that may come to
CytRx’s or SynthRx’s attention. SynthRx and CytRx shall thereafter consuh and cooperate folly to
determine a course of action, including but not limited to the commencement of legal action by
SynthRx at its own expense to terminate any infringement of any of the CytRx Patent Rights or any
misappropriation or misuse of CytRx Know-How. SynthRx shall promptly inform CytRx if SynthRx
elects not to exercise its right to commence legal action and CytRx shall thereafter have the
right, but not the obligation, to either initiate and prosecute such action.
(b) In the event that SynthRx elects not to initiate and prosecute an action as provided in
paragraph (a), and CytRx elects to do so, the costs of any course of action to terminate
infringement of any of the CytRx Patent Rights or misappropriation or misuse of CytRx Know-How,
including the costs of any legal action commenced shall be shared equally by CytRx and SynthRx.
(c) For any action to terminate any infringement of any of the CytRx Patent Rights or any
misappropriation or misuse of CytRx Know-How, in the event that SynthRx is unable to initiate or
prosecute such action solely in its own name, CytRx will join such action voluntarily and will
execute and cause its Affiliates to execute all documents necessary for SynthRx to initiate
litigation to prosecute and maintain such action, In connection with any action, SynthRx and CytRx
will cooperate fully and will provide each other with any information or assistance that either may
reasonably request. Each party shall keep the other informed of developments in any action or
proceeding, including, to the extent permissible by law, the status of any settlement negotiations
and the terms of any offer related thereto.
(d) Any recovery obtained by either SynthRx or CytRx in connection with or as a result of any
action contemplated by this section, whether by settlement or otherwise, shall be shared in order
as follows:
Page 12 of 18
(i) the party which initiated and prosecuted the action shall recoup all of its costs and
expenses incurred in connection with the action;
(ii) the other party or parties shall then, to the extent possible, recover its costs and
expenses incurred in connection with the action; and
(iii) the amount of any recovery remaining shall then be allocated between the parties on a
pro rata basis under which CytRx shall receive a proportion based on the royalties it lost and
SynthRx shall receive any remaining amounts.
(e) CytRx shall immediately give notice to SynthRx of any certification regarding any Patent
Rights it has received pursuant to the United States “Drug Price Competition and Patent Term
Restoration Act of 1984” under either 21 U.S.C. §§355(b)(2)(A)(iv) or (j)(2)(A)(vii)(IV) or
equivalent foreign provision and shall provide SynthRx with a copy of such certification within 5
days of receipt. CytRx’s and SynthRx’s rights with respect to the initiation and prosecution of
any legal action as a result of such certification or any recovery obtained as a result of such
legal action shall be denned in paragraphs (a)-(d) hereof, provided, however, if SynthRx decides
not to bring infringement proceedings against the entity making such a certification, SynthRx shall
give notice to CytRx of such decision not to bring suit within 30 days after receipt of notice of
such certification. CytRx may then, but is not required to, bring suit against the party that
filed the certification. Any such suit by SynthRx or CytRx shall either be in the name of SynthRx
or in the name of CytRx, or jointly.
6.4 Patent Term Restoration. SynthRx and CytRx shall cooperate with each other in
obtaining patent term restoration or supplemental protection certificates or their equivalents in
any country in the Territory where applicable to the CytRx Patent Rights. SynthRx shall have the
opportunity to make any election with respect to obtaining such patent term restoration to the
extent possible and shall bear the cost thereof, which shall be fully creditable toward any future
royalty payments owed by SynthRx pursuant to Section 5.3 hereof
6.5 Patent Markings. SynthRx agrees to xxxx the Licensed Products and OptiVax sold in
the United States with all applicable United States patent numbers. All Licensed Products and
OptiVax shipped to or sold in other countries shall be marked in such a manner as to conform with
the patent laws and practice of the country of manufacture or sale.
ARTICLE VII
TERM AND TERMINATION
TERM AND TERMINATION
7.1 Term and Expiration. This Agreement shall be effective as of the Effective Date
and the term of this Agreement shall continue in effect until the expiration of all royalty
obligations hereunder. Upon expiration of all royalty obligations hereunder, SynthRx’s license
pursuant to Section 2.1 hereof shall become a fully paid-up, perpetual license.
7.2 Termination Without Cause by SynthRx. Notwithstanding anything contained herein
to the contrary, SynthRx shall have the right to terminate the license granted under this Agreement
at any time in its sole discretion by giving 90 days advance written notice to CytRx. In the event
of such termination under this Section 7.2, the rights and obligations under SynthRx’s
license pursuant to Section 2.1 hereof and any payment obligations not due and owing as of the
termination date shall terminate, but the provisions of Article III shall survive such termination.
Page 13 of 18
7.3 Termination for Cause.
7.3.1 Termination for Non-Payment. The parties agree that in the event that SynthRx
fails to make any non-disputed payment due by virtue of Article IV and such failure to make such
non-disputed payment continues for 30 days after written notice of such breach is provided to
SynthRx by CytRx, then the license granted to SynthRx under Section 2.1 hereof shall automatically
terminate at the conclusion of the such 30-day period, unless otherwise mutually agreed to in
writing by SynthRx and CytRx.
7.3.2 Termination for Cause. This Agreement may be terminated by notice by either
SynthRx or CytRx at any time during the term of this Agreement if the other party is in breach of
its material obligations hereunder by causes and reasons within its control and has not cured such
breach within 60 days after notice requesting cure of the breach. This Agreement may be terminated
by notice by CytRx upon the filing or institution of bankruptcy, reorganization, liquidation or
receivership proceedings by SynthRx, or upon a general assignment of a substantial portion of all
of SynthRx’s assets for the benefit of creditors; provided, however, in the case of any involuntary
bankruptcy proceeding such right to terminate shall only become effective if the party consents to
the involuntary bankruptcy or such proceeding is not dismissed within 90 days after the filing
thereof.
7.3.3 Effect of Termination for Cause on License.
(a) In the event that CytRx terminates this Agreement under Section 7.3.1 hereof or 7.3.2
hereof, SynthRx’s license pursuant to Section 2.1 hereof shall terminate as of such termination
date, but the provisions of Article in shall survive such termination.
(b) In accordance with Section 365(n) of the United States Bankruptcy Code, 11 USC 365(n), in
the event an order for relief becomes effective in any bankruptcy case under any chapter of the
Bankruptcy Code, in which CytRx is a debtor, SynthRx shall, as licensee from CytRx, upon the
rejection of such license by CytRx, have the right, without limitation and in addition to all
rights provided for by the Bankruptcy Code or otherwise, to elect to retain its rights (including a
right to enforce any exclusivity provision of such license, but excluding any other right under
applicable nonbankruptcy law to specific performance of such license) under such license and under
any agreement supplementary to such license, to such intellectual property (including any
embodiment of such intellectual property to the extent protected by applicable nonbankruptcy law),
as such rights existed immediately before the bankruptcy case commenced, for:
(i) the duration of such license; and
(ii) any period for which such contract may be extended by the licensee as of right under
applicable nonbankruptcy law.
Page 14 of 18
(c) In the event that CytRx materially breaches this Agreement and fails to cure such breach
as permitted by Section 7.3.1 hereof; SynthRx may, in lieu of terminating this Agreement, recover
the damages from CytRx specifically resulting from such breach; provided, however, that SynthRx
will continue to be obligated to make and shall make all of the payments to CytRx provided for by
Article IV hereof or otherwise under this Agreement.
7.4 Effect of Termination. Expiration or termination of the Agreement shall not
relieve the parties of any obligation accruing prior to such expiration or termination. Any
expiration or early termination of this Agreement shall be without prejudice to the rights of
either party against the other accrued or accruing under this Agreement prior to termination,
including the obligation to pay royalties for Licensed Products sold prior to such termination.
Notwithstanding the foregoing, any termination by either party pursuant to Section 7.3.1 hereof or
Section 7.3.2 hereof shall not limit any other remedies that either party may have against the
other arising out of or related to such breach, including claims for damages. To the extent
SynthRx’s license in CytRx Know-How is terminated, SynthRx shall promptly transfer to CytRx alt
copies and materials containing CytRx Know-How in its possession and control and in the possession
and control of its Affiliates, sublicensees and distributors and shall delete all CytRx Know-How,
or any portion thereof, from its and their computer data bases.
ARTICLE VIII
MISCELLANEOUS
MISCELLANEOUS
8.1 Force Majeure. Neither party shall be held liable or responsible to the other
party nor be deemed to have defaulted under or breached the Agreement for failure or delay in
fulfilling or performing any term of the Agreement when such failure or delay is caused by or
results from causes beyond the reasonable control of the affected party including, but not limited
to, fire, floods, embargoes, war, acts of war (whether war be declared or not), insurrections,
riots, civil commotions, strikes, lockouts or other labor disturbances, acts of God or acts,
omissions or delays in acting by any governmental authority or the other party. The affected party
shall notify the other party of such force majeure circumstances as soon as reasonably practical.
8.2 Assignment. This Agreement may not be assigned by SynthRx without the consent of
CytRx and may not be assigned by CytRx without the consent of SynthRx. Notwithstanding the
foregoing, either party hereto may assign this Agreement without the other party’s consent in
connection with a merger into, a consolidation with, or a transfer of all or substantially all of
its corporate assets or the transfer of all or substantially all of the assets related to the
product line to which this Agreement pertains as an entirety or to any corporation, partnership or
other person or entity, so long as the successor surviving person or entity in any such merger,
consolidation, partnership or other person or entity transfer or reorganization assumes in writing
the obligations of this Agreement. Such merger, consolidation, transfer or reorganization shall
not in any way be a breach of this Section 8.2, nor be a default under this Agreement. Any
permitted assignee shall assume all obligations of its assignor under the Agreement.
8.3 Severability. In the event any one or more of the provisions contained in this
Agreement should be held invalid, illegal or contained herein shall not in any way be affected or
impaired thereby, unless the absence of the invalidated provisions) adversely affect the
substantive rights of the parties. The parties shall in such an instance use their best efforts to
replace the
invalid, illegal or unenforceable provision(s) with valid, legal and enforceable provisions)
which, insofar as practical, implement the purposes of this Agreement.
Page 15 of 18
8.4 Notices. All notices or other communications which are required or permitted
hereunder shall be in writing and sufficient if delivered personally, sent by telecopier (and
promptly confirmed by personal delivery, registered or certified mail or overnight courier), sent
by internationally-recognized overnight or second day courier or sent by registered or certified
mail, postage prepaid, return receipt requested, addressed as follows:
if to CytRx, to:
|
CytRx Corporation | |
| 00000 Xxx Xxxxxxx Xxxxxxxxx | ||
| Xxxxx 000 | ||
| Xxx Xxxxxxx, Xxxxxxxxxx 00000 | ||
| Attention: President & CEO | ||
| Facsimile No.: (000) 000-0000 | ||
if to SynthRx, to:
|
SynthRx, Inc. | |
| 0000 Xxxxxx | ||
| Xxxxxxxx, Xxxxx 00000 | ||
| Facsimile No.: (000)000-0000 |
or to such other address as the party to whom notice is to be given may have furnished to the other
party in writing in accordance herewith. Any such communication shall be deemed to have been given
when delivered if personally delivered or sent by telecopier on a business day, on the business day
after dispatch if sent by nationally-recognized overnight courier and on the third business day
following the date of mailing if sent by mail.
8.5 Applicable Law. The Agreement shall be governed by and construed in accordance
with the laws of the State of Texas and the United States without reference to any rules of
conflict of laws.
8.6 Dispute Resolution. The parties shall negotiate in good faith and use reasonable
efforts to settle any dispute, controversy or claim arising from or related to this Agreement or
the breach thereof. If the parties do not fully settle, and a party wishes to pursue the matter,
each such dispute, controversy or claim that is not an “Excluded Claim” shall be finally resolved
by binding arbitration in Las Vegas, Nevada in accordance with the Commercial Arbitration Rules and
Supplementary Procedures for Large Complex Disputes of the American Arbitration Association
(“AAA”), and judgment on the arbitration award may be entered in any court having jurisdiction
thereof. The arbitration shall be conducted by a panel of three persons experienced in the
pharmaceutical business. Within 30 days after initiation of arbitration, each party shall select
one person to act as arbitrator and the two party-selected arbitrators shall select a third
arbitrator within 30 days of their appointment. If the arbitrators selected by the parties are
unable or fail to agree upon the third arbitrator, the AAA shall appoint the third arbitrator.
Either party may apply to the arbitrators for interim injunctive relief until the arbitration award
is rendered or the controversy is otherwise resolved. Either party also may, without waiving any
remedy under this Agreement, seek from any court having jurisdiction any injunctive or provisional
relief necessary to protect the rights or property of that party pending the arbitration award.
The arbitrators shall have no
Page 16 of 18
authority to award punitive or any other type of damages not measured by a party’s
compensatory damages. Each party shall bear its own costs and expenses and attorneys’ fees and an
equal share of the arbitrators’ and any administrative fees of arbitration. Except to the extent
necessary to confirm an award or as may be required by law, neither a party nor an arbitrator may
disclose the existence, content, or results of an arbitration without the prior written consent of
both parties. In no event shall an arbitration be initiated after the date when commencement of a
legal or equitable proceeding based on the dispute, controversy or claim would be barred by the
applicable Texas statute of limitations. As used in this Section, the term “Excluded Claim” shall
mean a dispute, controversy or claim that concerns (a) the validity or infringement of a patent,
trademark or copyright; or (b) any antitrust, anti-monopoly or competition law or regulation,
whether or not statutory.
8.7 Entire Agreement. This Agreement, together with the Organization Agreement,
contains the entire understanding of the parties with respect to the subject matter hereof. All
express or implied agreements and understandings, either oral or written, heretofore made are
expressly merged in and made a part of the Agreement. The Agreement may be amended, or any term
hereof modified, only by a written instrument duly executed by each of the parties hereto.
8.8 Headings. The captions to the several Articles and Sections hereof are not a part
of the Agreement, but are merely guides or labels to assist in locating and reading the several
Articles and Sections hereof.
8.9 Independent Contractors. It is expressly agreed that the parties shall be
independent contractors and that the relationship between the parties shall not constitute a
partnership, joint venture or agency. Neither party shall have the authority to make any
statements, representations or commitments of any kind, or to take any action, which shall be
binding on the other, without the prior consent of the other party.
8.10 Waiver. The waiver by either party hereto of any right hereunder or the failure
to perform or of a breach by the other party shall not be deemed a waiver of any other right
hereunder or of any other breach or failure by said other party whether of a similar nature or
otherwise.
8.11 Counterparts. The 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.
8.12 Waiver of Rule of Construction. Each party has had the opportunity to consult
with counsel in connection with the review, drafting and negotiation of this Agreement.
Accordingly, the parties agree that the rule of construction that any ambiguity in this Agreement
shall be construed against the drafting party shall not apply.
8.13 Exportation of Technical Information. SynthRx agrees to comply with the laws and
rules of the United States Government regarding prohibition of exportation of CytRx Know-How
furnished to SynthRx either directly or indirectly by CytRx.
Page 17 of 18
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first set forth
above.
| CytRx Corporation |
||||
| By: | /s/ Illegible | |||
| Title: | ||||
| Date: | ||||
| SynthRx, Inc. |
||||
| By: | /s/ Xxxxxx Xxxxxx | |||
| Title: Chairman | ||||
| Date: 6/8/04 | ||||
Page 18 of 18
[CytRx Corporation Letterhead]
August 3, 2006
Xxxxxx Xxxxxx, M.D., Ph.D.
President
SynthRx Corporation
C/o 6431 Xxxxxx, MSB 2.136
Xxxxxxx, XX 00000
President
SynthRx Corporation
C/o 6431 Xxxxxx, MSB 2.136
Xxxxxxx, XX 00000
| Re: | Amendment to License Agreement dated June 8, 2004, by and between CytRx Corporation and SynthRx, Inc. |
Dear Xxx,
Reference is made to that certain License Agreement (the “Agreement”) dated June 8, 2004, by
and between CytRx Corporation, a Delaware corporation (“CytRx”), and SynthRx, Inc., a Texas
corporation (“SynthRx”). Capitalized terms used but not defined herein shall have the meanings
ascribed to such terms in the Agreement.
This is to confirm that, notwithstanding anything to the contrary in the Agreement, the CytRx
Patent Rights shall include only patent rights related to the patent filings listed on the attached
schedule. Pursuant to Section 6.1 of the Agreement, SynthRx confirms that is has primary
responsibility for filing, prosecuting, and maintaining the CytRx Patent Rights at its own expense.
Except as set forth in this letter, all other terms of the Agreement remain unchanged.
Please sign where indicated below, whereupon this letter shall become a binding agreement
between us.
| Very truly yours, CYTRX CORPORATION |
||||
| By: | /s/ Xxxxxx X. Xxxxxxxxx | |||
| Name: | Xxxxxx X. Xxxxxxxxx | |||
| Title: | President and Chief Executive Officer | |||
| ACCEPTED AND AGREED: SYNTHRX, INC. |
||||
| By: | /s/ Xxxxxx Xxxxxx | |||
| Name: | Xxxxxx Xxxxxx, M.D., Ph.D. | |||
| Title: | President | |||
00000 Xxx Xxxxxxx Xxxx. • Suite 650 • Xxx Xxxxxxx, Xxxxxxxxxx 00000
Phone: (000) 000-0000 • Fax: (000) 000-0000
Phone: (000) 000-0000 • Fax: (000) 000-0000
***
| *** | Portions of this page have been omitted pursuant to a request for Confidential Treatment filed separately with the Commission. |
***
| *** | Portions of this page have been omitted pursuant to a request for Confidential Treatment filed separately with the Commission. |
***
| *** | Portions of this page have been omitted pursuant to a request for Confidential Treatment filed separately with the Commission. |
AGREEMENT AND AMENDMENT NO. 2
TO
LICENSE AGREEMENT
TO
LICENSE AGREEMENT
THIS AGREEMENT AND AMENDMENT NO. 2 TO LICENSE AGREEMENT (this “Amendment”) dated as of
December 1, 2010 (the “Amendment Date”), is entered into between SynthRx, Inc., a Delaware
corporation (“SynthRx”), and CytRx Corporation, a Delaware corporation (“CytRx”). This Amendment
shall be effective as of the closing of a merger or other strategic transaction (a “Strategic
Transaction”) between SynthRx and ADVENTRX Pharmaceuticals, Inc., a Delaware corporation (or one of
its affiliates). If a definitive agreement regarding a Strategic Transaction has not been signed
by February 28, 2011, or the Strategic Transaction has not closed within three (3) months of
signing such definitive agreement, this Amendment shall be deemed null and void.
WHEREAS, SynthRx and CytRx previously entered into that certain License Agreement dated June
8, 2004, as amended by an Amendment No. 1 dated August 3, 2006 (the “License Agreement”);
WHEREAS, SynthRx and CytRx recognize that providing clarity with respect to certain terms and
conditions of the License Agreement will enhance SynthRx’s ability (directly or through
partnerships or collaborations) to continue the development of certain products related to the
License Agreement and, in light of the foregoing, wish to clarify and amend the License Agreement
in certain respects as set forth herein;
NOW THEREFORE, in consideration of the foregoing, and other good and valuable consideration,
the receipt and sufficiency of which each party hereby acknowledges, CytRx and SynthRx hereby agree
as follows:
1. The definition of “CytRx Patent Rights” in Section 1.7 of the License Agreement is hereby
amended and restated in its entirety as follows:
“The term “CytRx Patent Rights” shall mean the United States patents listed in the schedule
to that certain letter agreement, dated August 3, 2006, regarding “Amendment to License
Agreement dated June 8, 2004, by and between CytRx Corporation and SynthRx, Inc,” and all
divisions, continuations, reissues, renewals, extensions, supplementary protection
certificates, utility models and the like of any such United States patents, and the
foreign equivalents thereof.”
2. The reference to “recital A” in Section 1.8 of the License Agreement is hereby amended to
be a reference to “recital B.”
3. Section 2.1 of the License Agreement is hereby amended and restated in its entirety as
follows:
1
“SynthRx License Grant. CytRx hereby grants to SynthRx effective as of the
Effective Date an exclusive license (with the right to grant sublicenses) under the
CytRx Patent Rights to research, develop, use, manufacture, have manufactured, sell, offer
to sell, have sold and import Licensed Products (including OptiVax), in each case in the
Territory and in the Field. In addition, if CytRx owns or controls any patent or patent
application that covers a Product for use in the Field and in the Territory (the “Other
Patent Rights”), and provided that CytRx has the right to grant a license under the Other
Patent Rights, then the CytRx Patent Rights shall also include the Other Patent Rights.”
4. In addition, for consistency, all references in the License Agreement to “Licensed
Intellectual Property” will be deemed to be references to “CytRx Patent Rights.”
5. The opening clause of Section 3.1 of the License Agreement is hereby amended by replacing
the words “as set forth herein” with “as is reasonably necessary for the development and
commercialization of FLOCOR, the Anti-Infectives and/or OptiVax.”
6. Section 4.2(a)(i) of the License Agreement is hereby amended and restated in its entirety
as follows:
“A $2,000,000 payment for the first Major Market Country in which Regulatory Approval is
obtained, upon securing the first commercial sale due to such approval.”
7. Section 4.3.7 of the License Agreement is hereby amended and restated in its entirety as
follows:
“With respect to each sublicense of CytRx Patent Rights, SynthRx, in its sole discretion,
may elect, as an alternative to, and in lieu of, the payment of milestones (Section 4.2)
and royalties (Section 4.3) in respect of the sale of any Licensed Product by such
sublicensee, to pay CytRx an amount equal to 20% of any sublicensing income received by
SynthRx from any third party within 30 days after receipt thereof. Sublicense income
includes all payments received by SynthRx in consideration of any sublicense of the rights
granted to SynthRx by CytRx pursuant to Section 2.1 hereof, including, without limitation,
license fees, royalties, milestone payments, license maintenance fees and strategic
alliance payments, whether in cash, equity or other property, with the payment by SynthRx
to CytRx to be in the same form as the payment received by SynthRx.”
8. Section 6.3(b) of the License Agreement is hereby amended and restated in its entirety as
follows:
“(b) In the event SynthRx elects not to initiate and prosecute an action as provided in
paragraph (a), and CytRx elects to do so, the costs of any course of action to terminate
infringement of any of the CytRx Patent Rights, including the costs of any legal action
commenced shall be borne solely by CytRx.”
2
9. Section 8.5 of the License Agreement is hereby amended and restated in its entirety as
follows:
“Applicable Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of California as applied to agreements among California
residents entered into and to be performed entirely within California.”
In addition, for consistency, Section 8.6 of the License Agreement is amended by replacing the
word “Texas” with “California.”
10. As of the Amendment Date, and assuming the passage of time and/or the giving of notice,
(i) to CytRx’s knowledge, SynthRx is not in breach of or default under any provision of the License
Agreement or, (ii) in the event of any such breach or default, CytRx hereby waives the occurrence
of and events underlying such breach or default (whether known or unknown and whether contingent or
otherwise). CytRx has not and will not exercise its rights to file for or maintain any CytRx
Patent Right that, as of the Amendment Date, SynthRx has not pursued or that SynthRx has abandoned.
11. In the event that CytRx provides any notice to SynthRx pursuant to Section 7.3 of the
License Agreement, CytRx also will provide written notice to each sublicensee under sublicense
agreements provided to CytRx under Section 2.2(d) of the License Agreement and both CytRx and
SynthRx agree that such sublicensee may cure any non-payment or breach, but only after the
expiration of any period provided in the License Agreement for cure by SynthRx, as if such
sublicensee were SynthRx; provided, however, the period for cure available to Synthrx shall be
extended by 30 days for the benefit of such sublicensee. In the event a breach is not subject to
cure, subject to consent of such sublicensee, or if CytRx and such sublicensee mutually agree,
immediately following expiration of the period provided for cure by SynthRx, such breach remaining
uncured, CytRx will assign the License Agreement to such sublicensee, and such sublicensee will
assume SynthRx’s rights and obligations thereunder, unless there remains an uresolved dispute
between SynthRx and CytRx regarding the existence of a breach. In such case, no assignment of the
License Agreement shall be made to a sublicense until a final determination is reached regarding
whether a breach existed entitling CytRx to terminate the License Agreement. SynthRx consents and
agrees to any such assignment.
12. CytRx acknowledges that, following the execution of this Amendment, SynthRx may grant a
sublicense under the rights granted to SynthRx under Section 2.1 of the License Agreement.
13. Any reference in the License Agreement to “this Agreement” (or similar references), and
any reference in this Amendment to the License Agreement, will be a reference to the License
Agreement, as amended.
3
14. Except as expressly modified herein, the License Agreement will continue to remain in full
force and effect in accordance with its terms. This Amendment may be
executed in two or more counterparts, each of which will be deemed an original, but all of
which together shall constitute one and the same instrument. This Amendment will be governed by
and construed in accordance with the laws of the State of California as applied to agreements among
California residents entered into and to be performed entirely within California.
In Witness Whereof, the parties have caused this Agreement and Amendment No. 2 to
License Agreement to be executed by their respective duly authorized representatives effective as
of the Amendment Date.
| SynthRx, Inc. | CytRx Corporation | |||||||||
By:
|
/s/ R Xxxxxx Xxxxxxxx | By: | /s/ Xxxxxx X. Xxxxxxxxx | |||||||
Name:
|
R Xxxxxx Xxxxxxxx | Name: | Xxxxxx X. Xxxxxxxxx | |||||||
Title:
|
President & CEO | Title: | President & CEO | |||||||
4
