TECHNOLOGY ACQUISITION AGREEMENT
Exhibit
10.3
ThisTECHNOLOGY
ACQUISITION AGREEMENT(the
“Agreement”)
is
dated effective as of March 16, 2006 (the “Effective
Date”)
by and
among FermaVir
Pharmaceuticals, Inc.,
a
Florida corporation (“Fermavir”)
and
Fermavir
Research, Inc.,
a
Delaware corporation (“Fermavir
Research”,
and
together with Fermavir referred herein as the “Company”),
on the
one hand, and Xxxxx
XxXxxxxx,
a
resident of Wales, Xxxx
XxXxxxxx,
a
resident of Belgium and Xxx
Xxxxxxxxx,
a
resident of Belgium (collectively, “Holders”),
on the
other hand, with reference to the facts and circumstances set forth in the
Recitals below.
RECITALS
A. Fermavir
Research is a wholly owned subsidiary of Fermavir as a result of the
shareholders of Fermavir Research, including Xx. XxXxxxxx, exchanging shares
of
Fermavir Research for shares of Fermavir on August 16, 2005 (the “Exchange”).
B. At
the
time of the Exchange Fermavir had raised $2,118,000 of capital in a private
placement (“Initial
Financing”),
and
has applied a portion of the net proceeds thereof to pay obligations of Fermavir
incurred to acquire the Core Technology (as defined below), Core Technology
Development (define below) and general working capital.
C. The
Company will apply the remaining proceeds from the Initial Financing and will
seek additional equity or debt financing to fund the Core Technology
Development, proved that certain key milestones have been achieved.
D. The
execution of this Agreement is a condition of the execution of a Restricted
Stock Purchase Option Agreement by Xx. XxXxxxxx, which gives the Company the
option to acquire 926,100 shares of Fermavir owned by Xx. XxXxxxxx, in the
event
a critical milestone is not met, as well as the agreement of Messrs. XxXxxxxx
and Xxxxxxxxx that certain options granted to them by the Company may be
cancelled by the Company at its option if the same critical milestone has not
been achieved (collectively the “Company’s Option”).
E. Subject
to the terms and conditions of this Agreement, Company desires to grant to
the
Holders an option to acquire the Core Technology from Company in the event
that
the Company exercises the Company’s Option.
F. The
parties are executing this Agreement to memorialize their understanding
regarding the foregoing.
AGREEMENT
NOW,
THEREFORE,
in
consideration of the above Recitals, the mutual promises and covenants set
forth
herein, and other good and valuable consideration, the sufficiency and receipt
of which is hereby acknowledged, the parties, intending to be legally bound,
agree as follows:
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ARTICLE
1
DEFINITIONS
1.1 Definitions. The
terms
below when used herein shall have the following meanings:
(a) “Acquisition
Option”shall
have the meaning given in Section 2.1 below.
(b) “Affiliate”
with respect to any Person shall mean any other Person directly or indirectly
controlling, controlled by or under common control with such
Person.
(c) “Agreement”
shall mean this Agreement and all exhibits and schedules hereto, as the same
may
from time to time be amended or supplemented by one or more instruments executed
by the Parties hereto.
(d) “Company
Records”
shall
have the meaning given in Section 3.3 below.
(e) “Core
Technology”
shall
mean all intellectual property and technology underlying the Fermavir
Technology, all divisionals, continuations, continuations-in-part,
substitutions, conversions, prolongations, extensions, reissues, reexaminations,
or renewals thereof, and any and all Improvements, trade secrets, know how
or
other proprietary rights related thereto.
(f) “Core
Technology Development”
shall
mean Company’s research and development relating to the Core
Technology.
(g) “Development
Period”
shall
mean the two (2) year period between the Closing and the second anniversary
of
the Closing.
(h) “Development
Report”
shall
have the meaning given in Section 3.3(b) below.
(i) “Direct
Offering Expenses”
shall
mean the sum of commissions, agent and underwriter expense reimbursements,
legal, accounting, expert and due diligence expenses, filing, printing and
listing fees borne by the issuer of securities in any financing.
(j) “Exercise
Date”shall
mean the date the Exercise Notice has been delivered to Company.
(k) “Exercise
Notice”shall
have the meaning given in Section 2.2 below.
(l) “Exercise
Period”shall
mean, subject tolling pursuant to Section 3.3 below, the thirty (30) day period
immediately following the Company’s exercise of the Company’s
Option.
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(m) “Fermavir
Technology”shall
mean all “Licensed Products,” Licensed Subject Matter,” “Patent Rights” and
“Technology Rights” or other rights granted directly or indirectly by University
Cardiff Consultants Limited to Fermavir Research pursuant to that Patent and
Technology License Agreement made February 2, 2005, as amended.
(n) “Improvements”
shall
mean any improvement, refinement, enhancement or other modification of the
Fermavir Technology that Company develops during the Development Period.
(o) “Liabilities”
shall mean claims, liabilities and obligations of every nature or kind, whether
accrued, absolute, contingent or otherwise and whether asserted or unasserted,
known or unknown and whether due or to become due.
(p) “Parties”
shall mean Company and the Holders.
(q) “Person”
shall mean an individual, corporation, partnership, joint venture, trust or
unincorporated organization or a federal, state, city, municipal or foreign
government or an agency or political subdivision thereof.
ARTICLE
2
GRANT
OF ACQUISITION OPTION
2.1 Grant
of Acquisition Option.
Subject
to the terms and conditions herein, Company hereby grants to the Holders an
option (the “Acquisition
Option”)
to
acquire the Core Technology from Company. The option may be exercised if Company
exercises the Company’s Option.
2.2 Exercise
of Option. Provided
that the condition set forth in Section 2.1 above has been met, the Holders
may
exercise the Acquisition Option during the Exercise Period by delivering nominal
consideration equal to $1.00 to the Company and written notice (the “Exercise
Notice”)
signed
by at least two of the Holders to either Fermavir or Fermavir Research in any
manner permitted under Section 4.4 below. The Company shall then have 10 days
(the “Cure
Period”)
to
retract its exercise of the Company’s Option. In the event that the Company
fails to retract, or otherwise states in writing that they do not wish to
retract, the Company’s Option within the Cure Period, the exercise of the
Acquisition Option shall become effective as of the end of the last day of
the
Cure Period. The Acquisition may only be exercised in whole and not in
part.
2.3 Intentionally
deleted.
2.4 Core
Technology Assignment.
Within
thirty (30) days after the Exercise Notice has become effective, Company shall
transfer, in exchange for the consideration set forth in Section 2.3, all
rights, title and interest in and to the Core Technology, without any
encumbrance or lien (but subject to any development or research right or
licenses granted by the Company prior to the Exercise Date and the payment
of
the Purchase Note), and deliver the Core Technology, including any documentation
thereto, to the Holders or any assignee of the Holders,including, without
limitation, University Cardiff Consultants Limited, as directed in the Exercise
Notice. To the extent any of the rights, title and interest in and to Core
Technology cannot be assigned by Company to Holders, Company will grant to
Holders or any assignee of the Holders an exclusive, royalty-free, transferable,
irrevocable, worldwide license (with rights to sublicense through multiple
tiers
of sublicensees) to practice such non-assignable rights, title and interest.
To
the extent any of the rights, title and interest in and to the Core Technology
can be neither assigned nor licensed by Company to Holders, Company will
irrevocably waive and agree never to assert such non-assignable and
non-licensable rights, title and interest against Holders or any of Holders’
successors in interest to such non-assignable and non-licensable rights, title
and interest.
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2.5 Cooperation
in Perfecting Rights to Core Technology
(a) Company
agrees to perform, within one hundred twenty (120) days after the assignment
of
the Core Technology set forth in Section 2.4, all acts and deliver all documents
deemed necessary by Holders to permit and assist Holders, in obtaining and
enforcing the full benefits, enjoyment, rights and title throughout the world
in
the Core Technology. Such acts may include, but are not limited to, execution
of
documents and assistance or cooperation (i) in the filing, prosecution,
registration and memorialization of assignment of the Core Technology and any
applicable patents, copyrights, mask work, or other applications and (ii) in
the
enforcement of any ownership rights in and to the Core Technology and any
applicable patents, copyrights, mask work, moral rights, trade secrets, or
other
proprietary rights.
(b) In
the
event that Holders are unable for any reason to secure Company's signature
to
any document required to evidence Holders’ ownership in and to the Core
Technology or to file, prosecute, register, or memorialize the assignment of
the
Core Technology or any patent, copyright, mask work or other applications or
to
enforce any patent, copyright, mask work, moral right, trade secret or other
proprietary rights related to the Core Technology, Company hereby irrevocably
designates and appoints each Shareholder, severally and not jointly, as
Company's agent and attorney-in-fact to act for and on Company's behalf and
instead of Company, (i) to execute, file, prosecute, register and memorialize
the assignment of any such application, (ii) to execute and file any
documentation required for such enforcement, and (iii) to do all other lawfully
permitted acts to further the transfer of all right, title, and interest in
and
to the Core Technology to Holders after delivery of the Exercise Notice, and
the
filing, prosecution, registration, memorialization of assignment, issuance,
and
enforcement of any ownership right in and to the Core Technology, any patents,
copyrights, mask works, moral rights, trade secrets or other rights relating
to
the Core Technology, all with the same legal force and effect as if executed
by
Company.
ARTICLE
3
OWNERSHIP
AND OBLIGATIONS OF COMPANY
3.1 Ownership
of Core Technology.
Subject
to the Acquisition Option, Company is and shall remain at all times, during
the
term of this Agreement, the sole and exclusive owner of the Core Technology
and
neither the Holders nor any third party shall have any right or interest
therein.
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3.2 Maintenance
and Enforcement of Ownership Rights.
(a) Maintenance.
During
the term of this Agreement, Company shall prepare, file, prosecute and maintain
any and all patent applications and patents, and other intellectual property
rights, relating to the Core Technology. If Company fails to take any action
reasonably necessary to prepare, file, prosecute or maintain patents and patent
applications, and other intellectual property rights relating to the Core
Technology, the Holders may take such action on behalf of Company and at
Company’s expense after first providing Company with thirty (30) days written
notice of its intention to do so. Company shall promptly reimburse the Holders
for all reasonable out-of-pocket expenses the Holders have incurred, or may
incur in the future, for such preparation, filing, prosecution and
maintenance.
(b) Enforcement.
During
the term of this Agreement, Company shall actively prosecute actions and/or
lawsuits against third parties for infringement of Company’s rights in the Core
Technology. All costs and expenses associated with such actions and lawsuits
shall be borne by Company, which shall be solely entitled to the full amount
any
recovery received as a result thereof, whether by adjudication or settlement.
(c) Notice
to Holders.
Company
agrees to notify the Holders promptly in the event Company becomes aware of
any
infringement of any right of Company in the Core Technology. Moreover, Company
shall keep the Holders informed of the status of any prosecution of actions
or
lawsuits against third parties for infringement.
3.3 Reports
and Records.
(a) Record
Keeping.
During
the Development Period, Company shall keep complete, accurate and authentic
accounts, notes, data and records, including, without limitation, any and all
ideas for technical solutions, designs, drawings, schematics, technical data,
prototypes, inventions, or other intellectual property, relating to the Core
Technology Development (collectively, “Company
Records”).
(b) Reports.
Simultaneously with exercising the Company’s Option, the Company shall furnish
the Holders with a report (the “Development
Report”)
setting
forth: (i) the Core Technology Development performed by Company during the
Development Period and a description (including patents and patent filings)
of
the Core Technology; and (ii) any other information the Holders may reasonably
request to be included in such Development Report.
(c) Audit
Rights.
To
ensure compliance with the terms of this Agreement, the Holders shall have
the
right to inspect and audit Company Records (including the Development Report)
and Company’s bookkeeping records relating to the Core Technology with the
assistance of professional consulting, law and accounting firms that are
reasonably acceptable to Company. All representatives of such firms involved
in
the inspection and audit shall be required to sign reasonable nondisclosure
agreements and to abide by reasonable site security requirements when carrying
out the inspection and audit. The inspection and audit shall be conducted during
normal business hours at Company’s offices in such a manner as not unreasonably
to interfere with Company’s normal business activities. Any such inspection and
audit shall be at the Holders’ sole expense.
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(d) New
Development Report.
If any
inspection and audit of the Development Report discloses material discrepancies
as to the Core Technology, then (i) Company shall pay to the Holders the
reasonable fees and expenses charged by the professional consulting, law,
accounting firms and (ii) the Parties shall promptly engage a mutually agreeable
independent party to provide a final Development Report. The finding by such
independent party shall be binding upon the Parties. Company shall pay the
expenses arising from the work performed by such independent party.
(e) Tolling
of Exercise Period.
The
Parties agree that the Exercise Period shall be tolled for the duration of
any
audit pursuant to sub-section (c) above, and any engagement by an independent
party and preparation of a final Development Report pursuant to sub-section
(d)
above.
3.4 Termination.
The
Company’s obligations under this Article 3 shall terminate and be of no further
force or effect upon the later of: (a) the transfer of the Core Technology
under
Sections 2.3 and 2.4 hereof, if the Acquisition Option; or (b) end of the
Exercise Period, if the Acquisition Option is not exercised.
ARTICLE
4
MISCELLANEOUS
PROVISIONS
4.1 Governing
Law.
The
interpretation and construction of this Agreement, and all matters relating
hereto, shall be governed by the laws of the State of New York applicable to
agreements executed and to be performed solely within such State without regard
to conflicts of laws.
4.2 Jurisdiction.
Any
judicial proceeding brought against any of the parties to this Agreement on
any
dispute arising out of this Agreement or any matter related hereto may be
brought in the courts of the State of New York, or in the United States District
Court for the Eastern or Southern District of New York, and, by execution and
delivery of this Agreement, each of the parties to this Agreement accepts the
exclusive jurisdiction of such courts, and irrevocably agrees to be bound by
any
judgment rendered thereby in connection with this Agreement. The prevailing
party or parties in any such litigation shall be entitled to receive from the
losing party or parties all costs and expenses, including reasonable counsel
fees, incurred by the prevailing party or parties.
4.3 Captions.
The
Article and Section captions used herein for reference purposes only, and shall
not in any way affect the meaning or interpretation of this
Agreement.
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4.4 Notices.
Any
notice or other communication required or permitted hereunder shall be deemed
sufficiently given when delivered in person, one business day after delivery
to
a reputa-ble overnight carrier, four business days if delivered by regis-tered
or certified mail, postage prepaid or when sent by telecopy with a copy
following by hand or overnight carrier or mailed, certified or registered mail,
postage prepaid, addressed as follows:
If
to the
Company:
Fermavir
Research, Inc.
000
Xxxxxxxxx Xxxxxx, Xxxxx 000
Xxx
Xxxx,
XX 00000
Attn:
President
with
a
required copy to:
Xxxxxxx
Xxxxxxx, Esq.
Sichenzia
Xxxx Xxxxxxxx Xxxxxxx LLP
0000
Xxxxxx xx xxx Xxxxxxxx, 00xx Xxxxx
Xxx
Xxxx,
XX 00000
If
to
Holders:
Xxxxx
XxXxxxxx
Cardiff
University
Redwood
Building
Xxxx
Xxxxxx VII Avenue
Cardiff
CF10 3XF Wales, United Kingdom
Xxxx
XxXxxxxx
Xxxx
Institute
Xxxxxxxxxxxxxx
Xxxxxx 00
X-0000
Xxxxxx, Xxxxxxx
Xxx
Xxxxxxxxx
Rega
Institute
Xxxxxxxxxxxxxx
Xxxxxx 00
B-3000
Leuven, Belguim
4.5 Parties
in Interest.
With
the exception of the Holders’ right to request transfer of the Core Technology
to and to effectuate the acquisition of the Core Technology through an assignee,
this Agreement may not be transferred, assigned, pledged or hypothecated by
any
party hereto, other than by operation of law. This Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
heirs, executors, administrators, successors and assigns.
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4.6 Counterparts.
This
Agreement may be executed in two or more counterparts and delivered by facsimile
all of which taken together shall constitute one instrument.
4.7 Entire
Agreement.
The
Exchange Agreement and this Agreement, including the exhibits hereto and the
other documents referred to herein which form a part hereof, contain the entire
understanding of the parties hereto with respect to the subject matter contained
herein and therein. This Agreement supersedes all prior agreements and
understandings between the parties with respect to such subject
matter.
4.8 Amendments.
This
Agreement may not be changed orally, but only by an agreement in writing signed
by Company and the Holders.
4.9 Severability.
In case
any provision in this Agreement shall be held invalid, illegal or unenforceable,
the validity, legality and enforceability of the remaining provisions hereof
will not in any way be affected or impaired thereby.
4.10 Third
Party Beneficiaries.
Each
party hereto intends that this Agreement shall not benefit or create any right
or cause of action in or on behalf of any person other than the parties
hereof.
[SIGNATURE
PAGE FOLLOWS]
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IN
WITNESS WHEREOF, undersigned parties have executed this Technology Acquisition
Agreement, as of the day and year first above written.
| “FERMAVIR:” | FermaVir Pharmaceuticals, Inc. | |
| a Florida corporation | ||
| By: /s/ Xxxxxxxx X. Xxxxxx | ||
|
Name: Xxxxxxxx
X. Xxxxxx
|
||
|
Title: President
|
||
| “FERMAVIR RESEARCH:” | FermaVir Research, Inc. | |
| a Delaware corporation | ||
| By: /s/ Xxxxxxxx X. Xxxxxx | ||
|
Name: Xxxxxxxx
X. Xxxxxx
|
||
|
Title: President
|
||
| “HOLDERS:” |
/s/
Xxxxx XxXxxxxx
Xxxxx
XxXxxxxx
|
|
|
/s/
Xxxx Xx Xxxxxx
Xxxx
Xx Xxxxxx
|
||
|
/s/
Xxx Xxxxxxxxx
Xxx
Xxxxxxxxx
|
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