PATENT AND TECHNOLOGY LICENSE AND PURCHASE OPTION AGREEMENT
EXHIBIT 10.1
PATENT AND TECHNOLOGY LICENSE AND
PURCHASE OPTION AGREEMENT
This Patent and Technology License and Purchase Option Agreement is entered into on June 20, 2016 (“Signing Date”) by and between (i) Q BioMed Inc. (“Q Bio”) and (ii) Bio-Nucleonics Inc. (“BNI”): BNI and Q Bio are hereinafter also referred to individually as a “Party” and collectively as the “Parties.”
The following capitalized terms when used in this Agreement shall have the respective meanings ascribed thereto below. Other capitalized terms are defined elsewhere in this Agreement.
1.1 “Affiliate(s)” shall mean, with respect to a Party, any one or more legal entities (i) owned or controlled by the Party, or (ii) owning or controlling the Party, or (iii) owned or controlled by the legal entity owning or controlling the Party, but any such legal entity shall only be considered an Affiliate of a Party for as long as such direct or indirect ownership or control exists. For the purposes of this definition a legal entity shall be deemed to own or control another legal entity if more than 50% (fifty percent) of the voting stock of the latter legal entity, ordinarily entitled to vote in the meetings of shareholders of that entity (or, if there is no such stock, more than 50% (fifty percent) of the ownership of or control in the latter legal entity), is held, directly or indirectly, by the owning or controlling legal entity, or if a legal entity has the ability to appoint a majority of the board of directors of another legal entity or to hire and/or replace another legal entity’s upper management.
1.2 “Agreement” shall mean this Patent and Technology License and Purchase Option Agreement, including all its exhibits and annexes.
1.3 “Authorization” means any consent, approval, order, license, permit and other similar authorization of or from (including any applications to), any Governmental Entity, together with any renewals, extensions, or modifications thereof and additions thereto.
* Confidential treatment has been requested for certain portions of this Exhibit. The confidential portions of this Exhibit have been omitted and filed separately with the Securities and Exchange Commission. Such portions have been marked with “****” at the exact place where material has been omitted.
Exhibit 10.1, 1
1.4 “BNI Assets” shall mean
(i) BNI IP;
(ii) BNI Patents, if any;
(iii) BNI Products; and
(iv) all licenses, market authorizations granted to BNI by a governmental agency (including -an abbreviated new drug application (ANDA) under the U.S. Federal Food, Drug, and Cosmetic Act or other governmental approvals (as may be subsequently amended and/or approved) relating to BNI IP, BNI Patents and BNI Products (a “Market Authorization License”).
1.5 “BNI IP” shall mean all IP (including the BNI Patents, if any, and know how) owned by BNI that is related to Strontium-Chloride 89 (“SR89”), including methods and licenses for procurement, transport, end-product manufacturing, distribution, sales and marketing and all improvements to “BNI IP” made after the Closing, including those related to any and all therapeutic, diagnostic, pain relief or other uses of “BNI IP” for any matter (including, but not limited to, prostate cancer, breast cancer, bone cancer, palliation or therapeutic use).
1.6 “BNI Patents” shall mean all BNI Patents and patent applications related to SR89 (including those listed on Exhibit 1.6) and any new patent application encompassing an invention comprising BNI IP; and any patent that issues therefrom together with any renewal, division, continuation, continued prosecution application or continuation-in-part of any of such patents, certificates, and applications, any and all patents or certificates of invention issuing thereon, and any and all reissues, reexaminations, extensions, divisions, provisional filings, parent applications, renewals, substitutions, confirmations, registrations and revalidations of or to any of the foregoing, and any foreign counterparts of any of the foregoing.
1.7 “BNI Product” shall mean any Product related to BNI IP, made or commercialized by, for or on behalf of BNI or its Affiliates in any country or territory in the world (or any component or subsystem thereof).
1.8 “Business Day” means any day other than a Saturday, Sunday or statutory holiday in the city of New York, United States.
1.9 “First Sale” means the first commercial sale of a BNI Product to an arms-length third party, of an aggregate of more than $****.
* Confidential treatment has been requested for certain portions of this Exhibit. The confidential portions of this Exhibit have been omitted and filed separately with the Securities and Exchange Commission. Such portions have been marked with “****” at the exact place where material has been omitted.
Exhibit 10.1, 2
1.10 “Environmental Laws” means all federal, state or local laws (including any statute, rule, regulation, ordinance, code or rule of common law), and all judicial or administrative interpretations thereof, and all decrees, judgments, policies, written guidance or judicial or administrative orders relating to the environment, health, safety or Hazardous Substances, including the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. § 9901 et seq., the Resource Conservation and Recovery Act of 1976, 42 U.S.C. § 6901 et seq., the Emergency Planning and Community Xxxxx-xx-Xxxx Xxx, 00 X.X.X. § 00000 et seq., the Clean Air Act, 42 U.S.C. § 7401 et seq., the Federal Water Pollution Control Act, 33 U.S.C. § 1251 et seq., the Toxic Substance Control Act, 15 U.S.C. § 2601 et seq., the Safe Drinking Water Act, U.S.C. § 300f et seq., the Occupational Safety and Health Act, 42 U.S.C. § 1801 et seq., the Federal Insecticide, Fungicide and Rodenticide Act, 7 U.S.C. § 136 et seq., the Hazardous Materials Transportation Act, 49 U.S.C. § 1801 et seq., and their state counterparts or equivalents, all as amended, and any regulations or rules adopted or promulgated pursuant thereto.
1.11 “Governmental Entity” means any federal, state, provincial, local, foreign or supranational (a) government; (b) court of competent jurisdiction; (c) governmental official agency, arbitrator, authority or instrumentality; (d) department, commission, board or bureau; or (e) regulatory body, including the U.S. Food & Drug Administration (the “FDA”), and the United States Drug Enforcement Administration.
1.12 “Gross Profits” shall mean Q Bio’s gross revenue derived from the sales of a BNI Product less the direct cost of goods sold which shall only include the costs directly associated with (i) the acquisition of raw materials, (ii) direct manufacturing cost, (iii) logistics and delivery and (iv) contract sales and marketing organizations but which shall not exceed 50% of the net profits to Q Bio from the sales of BNI Products.
1.13 “Hazardous Substance” means any: contaminant or pollutant; toxic, radioactive or hazardous waste, chemical, substance, material or constituent; asbestos; polychlorinated byphenyls (PCBs); paint containing lead or mercury; fixtures containing mercury or urea formaldehyde; natural or liquefied gas; flammable, explosive, corrosive, radioactive, medical and infectious waste; and oil or other petroleum product, all as defined in Environmental Laws.
1.14 “Intellectual Property” or “IP” shall mean:
(i) inventions and discoveries, whether patentable or not, all patents, registrations, invention disclosures and applications therefor, including divisions, continuations, continuations-in-part and renewal applications, and including renewals, extensions and reissues;
(ii) Trade Secrets;
(iii) to the extent not meeting the definition of Trade Secrets, other confidential information, know-how, processes, schematics, business methods, formulae, drawings, prototypes, models, designs, customer lists and supplier lists;
(iv) published and unpublished works of authorship, whether copyrightable or not, including, without limitation, databases or other compilations of information), copyrights therein and thereto, and registrations and applications therefor, and all renewals, extensions, restorations and reversions thereof; and
* Confidential treatment has been requested for certain portions of this Exhibit. The confidential portions of this Exhibit have been omitted and filed separately with the Securities and Exchange Commission. Such portions have been marked with “****” at the exact place where material has been omitted.
Exhibit 10.1, 3
(v) all other generally recognized intellectual property or proprietary rights (including trademarks, service marks and similar rights in marks, names and logos).
1.15 “Knowledge” shall mean actual knowledge and any knowledge that would have been acquired upon reasonable inquiry and investigation; as applies to BNI Assets, such knowledge shall be limited to Xx. Xxxxxxx Xxxx and Xx. Xxxx Xxxx, except where otherwise stated.
1.16 “Legal Requirement” means any constitution, act, statute, law (including common law), ordinance, treaty, rule or regulation of any Governmental Entity.
1.17 “Principal Market” means (i) any national exchange on which the Common Stock is traded, and if none then (ii) the NASDAQ, and if not then (iii) the OTCQB of the OTC Markets Group Inc., and if not then (iv) the Over-the-Counter Bulletin Board of the Financial Industry Regulatory Authority, Inc.
1.18 “Royalty Reporting Form” shall mean a written statement in the form as attached hereto as Exhibit 1.18 signed by a duly authorized officer on behalf of Q Bio.
1.19 “Technology” shall mean any technical information, clinical trial data, know-how, processes, procedures, methods, formulae, protocols, techniques documentation, works of authorship, data, designations, substances, components, inventions (whether or not patentable)ideas, trade secrets and other information or materials, in tangible or intangible form, as it relates to discoveries, inventions, and indications that are related to BNI Assets.
1.20 “Third Party” shall mean any entity, person or government entity other than a Party or an Affiliate of a Party.
1.21 “Trade Secret” shall mean information and know-how to the extent that such information or know-how (a) derives independent economic value, actual or potential, from not being generally known to the public or to other persons who can obtain economic value from its disclosure or use and (b) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy. Trade Secrets may include, but are not limited to confidential information, know-how, processes, schematics, business methods, formulae, customer lists, and supplier lists that meet the foregoing definition.
1.22 “Trading Day” means, as applicable, (x) with respect to all price determinations relating to the Common Stock, any day on which the Common Stock is traded on the Principal Market, or, if the Principal Market is not the principal trading market for the Common Stock, then on the principal securities exchange or securities market on which the Common Stock is then traded, provided that “Trading Day” shall not include any day on which the Common Stock is scheduled to trade on such exchange or market for less than 4.5 hours or any day that the Common Stock is suspended from trading during the final hour of trading on such exchange or market (or if such exchange or market does not designate in advance the closing time of trading on such exchange or market, then during the hour ending at 4:00:00 p.m., New York time) or (y) with respect to all determinations other than price determinations relating to the Common Stock, any day on which The New York Stock Exchange (or any successor thereto) is open for trading of securities.
* Confidential treatment has been requested for certain portions of this Exhibit. The confidential portions of this Exhibit have been omitted and filed separately with the Securities and Exchange Commission. Such portions have been marked with “****” at the exact place where material has been omitted.
Exhibit 10.1, 4
1.23 “VWAP” means, for any security as of any date, the dollar volume-weighted average price for such security on the Principal Market (or, if the Principal Market is not the principal trading market for such security, then on the principal securities exchange or securities market on which such security is then traded) during the period beginning at 9:30:01 a.m., New York time, and ending at 4:00:00 p.m., New York time, as reported by Bloomberg through its “Volume at Price” function or, if the foregoing does not apply, the dollar volume-weighted average price of such security in the over-the-counter market on the electronic bulletin board for such security during the period beginning at 9:30:01 a.m., New York time, and ending at 4:00:00 p.m., New York time, as reported by Bloomberg, or, if no dollar volume-weighted average price is reported for such security by Bloomberg for such hours, the average of the highest closing bid price and the lowest closing ask price of any of the market makers for such security as reported in the “pink sheets” by OTC Markets Group Inc. (formerly Pink Sheets LLC). If VWAP cannot be calculated for such security on such date on any of the foregoing bases, the VWAP of such security on such date shall be the fair market value as mutually determined by the Company and the Holder.
* Confidential treatment has been requested for certain portions of this Exhibit. The confidential portions of this Exhibit have been omitted and filed separately with the Securities and Exchange Commission. Such portions have been marked with “****” at the exact place where material has been omitted.
Exhibit 10.1, 5
3.1 Closing. Subject to the terms and conditions hereof, the closing of the transactions contemplated herein (“Closing”) will take place on or before June 20, 2016 (the “Closing Date”). The Closing shall be held at the offices of Xxxxxxx Ortoli Xxxxxx-Xxxx Xxxxxxxxxx LLP at 501 Madison Avenue, New York, NY, USA, or another place as mutually agreed to by the Parties.
(a) issue to BNI - 110,000 shares of its common stock (the “Stock Payment”) pursuant to the following schedule:
(i)
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50,000 shares of Q Bio common stock upon Closing (the “Initial Stock Payment”);
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(ii)
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**** shares of Q Bio common stock upon successful amendment of ANDA 75-941Market Authorization License granted to BNI on January 6, 2003 by the FDA (a copy of which license is attached hereto as Exhibit 3.2(a)(ii) to allow Isotex or another properly licensed entity to manufacture Strontium Chloride Sr89 Injection, USP (the “Amended FDA Market Authorization License”), provided that if such amendment occurs after the Amended Market Authorization Deadline such amount shall be reduced to **** shares (“Market Authorization Stock Payment”); and
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(iii)
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**** shares of Q Bio common stock upon the First Sale, provided that if the Amended FDA Market Authorization License is approved by the U.S. FDA after the Amended Market Authorization Deadline such amount shall be reduced to **** shares (“First Sale Payment”).
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* Confidential treatment has been requested for certain portions of this Exhibit. The confidential portions of this Exhibit have been omitted and filed separately with the Securities and Exchange Commission. Such portions have been marked with “****” at the exact place where material has been omitted.
Exhibit 10.1, 6
From the time each of the Initial Stock Payment, Market Authorization Stock Payment and First Sale Payment are issued, the shares of common stock underlying each issuance shall be held in escrow at SOVR Law and restricted from transfer pursuant to the terms of a lock-up agreement, the form of which shall be delivered within ten business (10) days of Closing (the “Lock-Up Agreement”).
(b) subject to the terms ultimately agreed to between BNI and the holders of the liens found in Exhibit 7.3 hereto, pay $850,000 to be used in the final steps to acquire BNI Asset and commercialize a BNI Product in accordance with the use of proceeds found in Schedule 3.2(b) (“Total Cash Investment”). Of the Total Cash Investment Q Bio shall transfer:
(i) $**** to BNI at Closing directly to BNI (the “Initial Cash Payment”) (ii) $**** to BNI no later than 30 days from Closing to third parties approved in writing by BNI that are preparing or supporting the preparation of the Amended FDA Market Authorization License and/or to undertaking studies or other actions necessary to complete such Amended FDA Market Authorization License; and
(iii) the remaining $**** Total Cash Investment in accordance with a timeline to be mutually agreed upon between the Parties, but in no event longer than 12 months from the Closing; provided that prior to the approval of the Amended FDA Market Authorization License by the FDA such payments shall be made either directly to BNI or to third parties approved in writing by BNI, as agreed to by the Parties, for activities that include preparing the Amended FDA Market Authorization License, undertaking studies or other actions necessary to complete such Amended FDA Market Authorization License
(a) Subject to subsection (c) of this section 3.3, Q Bio agrees to pay to BNI a: (i) **** % royalty on Gross Profits until BNI has been paid a total of $**** , (ii) **** % royalty on Gross Profits until BNI has been paid a total of an additional $**** and (iii) after BNI has received a total of $**** from (i) and (ii) above, it shall receive a perpetual royalty of **** % on Gross Profits.
(b) Within thirty (30) calendar days following the end of each calendar quarter after the Closing, Q BIO shall submit to BNI (even in the event that no royalties are due) a royalty reporting form, duly completed by an authorized officer of Q Bio, together with any payments due under this Section.
(c) First Sale, as defined herein, shall take place no later than **** months after BNI has completed all regulatory and manufacturing tasks associated with the Product so that it can be commercialized. Subject to the Parties having made a good faith and commercially reasonable effort, Q Bio shall pay the following minimal royalty guarantee in cash: (1) Year 1 following First Sale: $****; (2) Year 2 following First Sale: $**** and (3) Year 3 following First Sale: $****.
* Confidential treatment has been requested for certain portions of this Exhibit. The confidential portions of this Exhibit have been omitted and filed separately with the Securities and Exchange Commission. Such portions have been marked with “****” at the exact place where material has been omitted.
Exhibit 10.1, 7
(a) If a reversion occurs pursuant to Section 2.4(a), in exchange for all Stock Payments and all cash invested to the date of such reversion, BNI shall pay to Q Bio a royalty in all income derived from BNI Products or BNI Assets equal to (i) **** % until such time that the aggregate of royalties paid to Q Bio exceeds twice the aggregate of all Total Cash Investment paid by Q Bio and (ii) in the event that the aggregate of the Total Cash Investment paid to BNI, any royalties paid under Section 3.3 hereof and any other amounts advanced to or on behalf of BNI by Q Bio equals or exceeds $**** as of the date of reversion, **** % thereafter in perpetuity.
(b) Within thirty (30) calendar days following the end of each calendar quarter after the Closing, BNI shall submit to Q Bio (even in the event that no royalties are due) a royalty reporting form, duly completed by an authorized officer of BNI, together with any payments due under this Section.
(i) If Q Bio sells BNI Assets or the rights to commercialize a BNI Product, in each case, that is not in existence on the date of the Closing, to an unrelated third party (a “Non-Royalty Based Economic Event”) within the first twelve **** months following the Closing, Q Bio shall deliver to BNI within five (5) Business Days of the closing of such sale, **** percent (**** %) of the value received by Q Bio attributable to the BNI Assets.
(ii) If Q Bio engages in a Non-Royalty Based Economic Event between **** and **** months after the Closing, Q Bio shall deliver to BNI within five (5) Business Days of closing of such sale, **** % of the value received by Q Bio attributable to the BNI Assets.
(iii) If Q Bio engages in a Non-Royalty Based Economic Event after the **** month anniversary of the Closing, Q Bio shall deliver to BNI within five (5) Business Days of closing of such sale, **** % of the value received by Q Bio attributable to the BNI Assets. For point of clarification a “sale” does not include a royalty and or license arrangement with a third party.
(iv) If Q Bio sells BNI Assets or the rights to commercialize a BNI Product, in each case, that is not in existence on the date of the Closing to a third party introduced to Q Bio by BNI at any time during the Term, Q Bio shall deliver to BNI, within five (5) Business Days of the closing of such sale, an additional **** % of the value received by Q Bio attributable to the BNI Assets.
(v) If Q Bio sublicenses the rights under this Agreement to a Third Party, Q Bio shall remain the responsible party with regard to honoring all obligations to BNI under this Agreement.
* Confidential treatment has been requested for certain portions of this Exhibit. The confidential portions of this Exhibit have been omitted and filed separately with the Securities and Exchange Commission. Such portions have been marked with “****” at the exact place where material has been omitted.
Exhibit 10.1, 8
(ii) Compliance with all necessary legal requirements.
(a) Since January 1, 2012, it has been in compliance in all material respects with all legal requirements relating to the BNI Assets. Since January 1, 2012, it has not received any notice, claim, request for information, complaint or administrative or judicial order from any governmental entity or any written notice, claim, request for information or complaint from any other person alleging any failure to comply with or any liability under any legal requirement relating to BNI Assets, and to the knowledge of BNI, none is pending or threatened, or have been received by BNI prior to January 1, 2012, except for any such notice relating to an immaterial failure to comply that has since been cured.
* Confidential treatment has been requested for certain portions of this Exhibit. The confidential portions of this Exhibit have been omitted and filed separately with the Securities and Exchange Commission. Such portions have been marked with “****” at the exact place where material has been omitted.
Exhibit 10.1, 9
(b) There has not been any action, operating practice or failure to act by BNI that would reasonably be expected to give rise to a liability on the part of Q Bio as a result of:
(1) the generation, handling, storage, use, presence, transportation, treatment or disposal or arranging for transportation or disposal of any Hazardous Substance in connection with its intended use;
(2) any emission, discharge or release of any hazardous substance into or upon the air, surface water, ground water, drinking water, sediments or land in connection with its intended use;
(3) any disposal, handling, manufacturing, processing, distribution, use, treatment or transport of any Hazardous Substances in connection with the intended use;
(4) the presence of any Hazardous Substances (including asbestos, urea formaldehyde foam installation or similar substances contained in building materials) in the operation of the intended use; or
(5) sending or disposing of, otherwise taking or transporting, arranging for the taking or disposal of or release of a Hazardous Substance to or at a site that is contaminated by any Hazardous Substance or that, pursuant to any Environmental Law: (A) has been placed on the “National Priorities List,” the “CERCLIS” list, or any similar state or federal list; or (B) is subject to or the source of a claim, an administrative order or other request to take removal, remedial, corrective or any other response action under any Environmental Law or to pay for the costs of any such action at the site.
(6) BNI holds all Authorizations issued by or on behalf of any Governmental Entity that are required to develop the BNI Assets or pursuant to any Environmental Laws for the conduct by BNI and its Affiliates of the intended use and the possible ownership of BNI Assets (“Environmental Permits”), except where the failure to hold such Environmental Permits would not have a material adverse effect on the value of BNI Assets taken as a whole. Any such Environmental Permits held by BNI are currently in full force and effect. BNI and its Affiliates are and for the past five years have been in compliance in all material respects with all terms and conditions of such Environmental Permits, and with all other applicable limitations, restrictions, conditions, standards, prohibitions, requirements, obligations, schedules and timetables contained in Environmental Laws.
(c) BNI has not, either expressly or by operation of law, assumed or undertaken, or agreed to indemnify, any liability or corrective, investigatory or remedial obligation of any other Person, relating to any Environmental Laws.
(d) BNI has made available to Q Bio copies of all environmental reports, audits, permits, licenses, registrations and other environmental, health or safety documents relating to the BNI Assets that are in BNI’s possession or control.
* Confidential treatment has been requested for certain portions of this Exhibit. The confidential portions of this Exhibit have been omitted and filed separately with the Securities and Exchange Commission. Such portions have been marked with “****” at the exact place where material has been omitted.
Exhibit 10.1, 10
(a) Except as set out in Schedule 4.1(iii)(a), BNI Product are being or have been developed, manufactured, tested, packaged, distributed, and sold in substantial compliance with all applicable requirements under the Federal Food, Drug and Cosmetic Act (“FDCA”), the Public Health Service Act (“PHSA”) and the regulations of the Food and Drug Administration (“FDA”) promulgated thereunder and similar applicable foreign Legal Requirements, including those relating to investigational use, good manufacturing practices, good clinical practices, good laboratory practices, registration and listing, record keeping, adverse event reporting, and submission of other required reports. The required licenses and authorizations are current and in full force and effect and include all necessary and relevant regulatory filings and governmental registrations made by or issued to BNI or any of its Affiliates that relate specifically to BNI Products. BNI has made available to Q Bio true and complete copies of all governmental correspondence (including copies of official notices, citations or decisions) in the files of BNI or its Affiliates relating to the Specified Authorizations.
(b) Except as set out in Schedule 4.1(iii)(b), BNI or its Affiliates have obtained all necessary licenses, permits and registrations required by FDA, any other applicable Governmental Entity, and any applicable foreign regulatory authority to permit the operation of the intended use by BNI and the Affiliates as presently conducted and all such licenses, permits and registrations are included in the Specified Authorizations. Neither BNI nor any of its Affiliates have received any communication from any Governmental Entity threatening to withdraw or suspend any such license, permit, or registration. BNI or its Affiliates have filed with the applicable regulatory authorities all required filings, declarations, listings, registrations, reports or submissions, including adverse event reports. All relevant filings, declarations, listings, registrations, reports or submissions were in compliance with all applicable Legal Requirements when filed, and no deficiencies have been asserted by any applicable regulatory authority with respect to any such filings, declarations, listing, registrations, reports or submissions.
(c) Neither BNI nor any of its Affiliates nor, to the Knowledge of BNI, any of the officers, key employees, agents or clinical investigators acting for BNI or any of its Affiliates has received any communication from FDA or any other Governmental Entity, including without limitation any warning letter or untitled letter that alleges or suggests that the intended use is not in compliance with any applicable requirements under the FDCA, the PHSA, FDA regulations promulgated thereunder, or similar applicable foreign Legal Requirements.
(d) Neither BNI nor any of its Affiliates nor, to the Knowledge of BNI, any of the officers, key employees, agents or clinical investigators acting for BNI or its Affiliates, has committed any act, made any statement or failed to make any statement or commit any act that would reasonably be expected to provide a basis for the FDA to invoke its policy with respect to “Fraud, Untrue Statements of Material Facts, Bribery, and Illegal Gratuities” set forth in 56 Fed. Reg. 46191 (September 10, 1991) and any amendments thereto. Additionally, neither BNI or its Affiliates, nor to the Knowledge of BNI, any officer, employee or agent of BNI or its Affiliates has been convicted of any crime or engaged in any conduct that would reasonably be expected to result, or has resulted, in (i) debarment under 21 U.S.C. Section 335a or any similar state Legal Requirement; or (ii) exclusion under 42 U.S.C. Section 1320a-7 or any similar state Legal Requirement.
* Confidential treatment has been requested for certain portions of this Exhibit. The confidential portions of this Exhibit have been omitted and filed separately with the Securities and Exchange Commission. Such portions have been marked with “****” at the exact place where material has been omitted.
Exhibit 10.1, 11
(e) To the Knowledge of BNI, there are no investigations, suits, claims, actions or proceedings against or affecting BNI or any Affiliate relating to BNI Assets, including those relating to or arising under applicable Legal Requirements relating to government health care programs, private health care plans, or the privacy and confidentiality of patient health information.
(f) BNI and the Affiliates are in compliance in all material respects with all healthcare Legal Requirements to the extent applicable to the operation of the intended use and the sale of BNI Products, as currently conducted, including any and all federal, state and local fraud and abuse laws, including the federal Anti-Kickback Statute (42 U.S.C. § 1320a-7(b)), the civil False Claims Act (31 U.S.C. § 3729 et seq.) and the regulations promulgated pursuant to such statutes. Neither BNI nor any Affiliate is subject to any enforcement, regulatory or administrative proceedings against or affecting BNI relating to or arising under the FDCA or similar Legal Requirement, and to the Knowledge of BNI no such enforcement, regulatory or administrative proceeding has been threatened.
* Confidential treatment has been requested for certain portions of this Exhibit. The confidential portions of this Exhibit have been omitted and filed separately with the Securities and Exchange Commission. Such portions have been marked with “****” at the exact place where material has been omitted.
Exhibit 10.1, 12
. BNI represents and warrants that this Agreement has been duly and validly authorized, executed and delivered on behalf of BNI and constitutes the legal, valid and binding obligations of BNI enforceable against BNI in accordance with its respective terms, except as such enforceability may be limited by general principles of equity or to applicable bankruptcy, insolvency, reorganization, moratorium, liquidation and other similar laws relating to, or affecting generally, the enforcement of applicable creditors’ rights and remedies.
* Confidential treatment has been requested for certain portions of this Exhibit. The confidential portions of this Exhibit have been omitted and filed separately with the Securities and Exchange Commission. Such portions have been marked with “****” at the exact place where material has been omitted.
Exhibit 10.1, 13
4.2 Q Bio hereby represents and warrants, or covenants (as the case may be) as follows:
(i) Non-Contravention. Neither the execution and delivery of this Agreement nor the performance of this Agreement will result (with or without notice or lapse of time) in (i) a violation of any judgment, order or decree to which Q Bio is subject or (ii) a breach or violation of any agreement or understanding (whether oral, written, express or implied) to which Q Bio is a party.
(ii) Validity; Enforcement
. This Agreement has been duly and validly authorized, executed and delivered on behalf of Q Bio and constitutes the legal, valid and binding obligations of BNI enforceable against Q Bio in accordance with their respective terms, except as such enforceability may be limited by general principles of equity or to applicable bankruptcy, insolvency, reorganization, moratorium, liquidation and other similar laws relating to, or affecting generally, the enforcement of applicable creditors’ rights and remedies.
(iii) Good Standing. Q Bio is an entity duly organized, validly existing and in good standing under the laws of the State of Nevada with the requisite power and authority to enter into and to consummate the transactions contemplated by this Agreement and otherwise to carry out its obligations hereunder.
* Confidential treatment has been requested for certain portions of this Exhibit. The confidential portions of this Exhibit have been omitted and filed separately with the Securities and Exchange Commission. Such portions have been marked with “****” at the exact place where material has been omitted.
Exhibit 10.1, 14
(iv) Issuance of Securities
. The issuance of the Common Stock of Q Bio under this Agreement has been duly authorized and upon issuance of such Common Stock in accordance with the terms of the this Agreement, such Common Stock shall be validly issued, fully paid and non-assessable and free from all preemptive or similar rights, taxes, liens, charges and other encumbrances with respect to the issue thereof, and is in compliance with all applicable United States securities laws and regulations.
(v) Equity Capitalization
. As of the date hereof, the authorized capital stock of Q Bio consists of (i) 250,000,000 shares of Common Stock, of which, 8,749,835 are issued and (ii) 100,000,000 shares of blank check preferred stock, of which, none are issued and outstanding.
(vi) Cooperation. Except where otherwise set out in this Agreement, Q Bio shall use commercially reasonable efforts to take, or cause to be taken, all actions, and do, or cause to be done, and to assist and cooperate with BNI in doing, all things reasonably necessary, proper or advisable to consummate the transactions contemplated hereby.
(vii) Bankruptcy. Q Bio represents and warrants that it has not (i) made a general assignment for the benefit of creditors, (ii) filed any voluntary petition in bankruptcy or suffered the filing of an involuntary petition by any creditor, (iii) suffered the appointment of a receiver to take possession of all or any portion of its assets, (iv) suffered the attachment or judicial seizure of all or any portion of its assets, (v) admitted in writing to one or more of its lenders or trade creditors its inability to pay its debts as they come due, (vi) made an offer of settlement, extension or composition to its creditors generally nor (vii) does it have any current intention to undertake such actions or Knowledge that such actions are being taken against it.
(viii) Arm’s Length Transaction. The terms and provisions of this Agreement were negotiated at arm’s length and are fair, reasonable and consistent with existing market conditions. The transactions contemplated by this Agreement are not being entered into by Q Bio with the intention of hindering, delaying or defrauding any of Q Bio’s current or future creditors.
(ix) Management. Q Bio shall use commercially reasonable efforts to have each of Xx. Xxxxxxx Xxxx and/or Xx. Xxxx Xxxx appointed to its Advisory Board on the date of Closing or as soon as possible thereafter. Upon the exercise of the Option, each of Dr. and Xx. Xxxx shall be eligible to receive stock options to acquire shares of Q Bio common stock on terms consistent with other Advisory Board members at the discretion of the Q Bio compensation committee.
* Confidential treatment has been requested for certain portions of this Exhibit. The confidential portions of this Exhibit have been omitted and filed separately with the Securities and Exchange Commission. Such portions have been marked with “****” at the exact place where material has been omitted.
Exhibit 10.1, 15
Unless there is reversion of rights, title and interest in BNI Assets and, if applicable, other Technology pursuant to Section 2.4 of this Agreement, BNI shall not directly or indirectly develop, manufacture, distribute, sell or market any BNI products that would compete with the BNI Assets licensed hereunder.
* Confidential treatment has been requested for certain portions of this Exhibit. The confidential portions of this Exhibit have been omitted and filed separately with the Securities and Exchange Commission. Such portions have been marked with “****” at the exact place where material has been omitted.
Exhibit 10.1, 16
d
7.1 Closing Conditions. The obligation of Q Bio to effect the Closing shall be subject to the satisfaction at or prior to the Closing of the following conditions, unless waived in writing by Q Bio:
* Confidential treatment has been requested for certain portions of this Exhibit. The confidential portions of this Exhibit have been omitted and filed separately with the Securities and Exchange Commission. Such portions have been marked with “****” at the exact place where material has been omitted.
Exhibit 10.1, 17
(vii) Within 10 business days of Closing, Q Bio shall deliver to each of Xx. Xxxxxxx Xxxx and Xx. Xxxx Xxxx the form of Lock-Up Agreement incorporating the “leak-out” provisions found in the Term Sheet dated March 23, 2016 and each of Dr. and Xx. Xxxx shall make a good faith effort to enter into each of such Agreement within 10 business days following receipt thereof.
* Confidential treatment has been requested for certain portions of this Exhibit. The confidential portions of this Exhibit have been omitted and filed separately with the Securities and Exchange Commission. Such portions have been marked with “****” at the exact place where material has been omitted.
Exhibit 10.1, 18
8.1 Without in any way limiting any of the rights or remedies otherwise available to any of Q Bio, its Affiliates and their respective directors, officers, agents and employees (the “Q Bio Indemnitees”), BNI shall indemnify and hold harmless each Q Bio Indemnitee against and from any damages finally awarded against such Q Bio Indemnitee and any cost award made against such Q Bio Indemnity in regards to any legal proceeding relating to allegations that Q Bio’s use and/or commercialization of the BNI Assets as permitted under this Agreement constitutes willful infringement any third party rights in the United States, provided the foregoing will not apply where the freedom to operate opinion failed to disclose a third party patent that has been infringed or did in fact disclose such patent but the parties nevertheless agreed to move forward irrespective of same.
8.2 Without in any way limiting any of the rights or remedies otherwise available to any of BNI, its Affiliates and their respective directors, officers, agents and employees (the “BNI Indemnitees”), Q Bio shall indemnify and hold harmless each BNI Indemnitee against and from any damages finally awarded against such BNI Indemnitee and any cost award made against such BNI Indemnitee in regards to any unauthorized use or commercialization of the BNI Assets, any modification to and/or improvement of the BNI Assets by Bio Q, or any breach of Bio Q’s confidentiality obligations under this Agreement.
* Confidential treatment has been requested for certain portions of this Exhibit. The confidential portions of this Exhibit have been omitted and filed separately with the Securities and Exchange Commission. Such portions have been marked with “****” at the exact place where material has been omitted.
Exhibit 10.1, 19
* Confidential treatment has been requested for certain portions of this Exhibit. The confidential portions of this Exhibit have been omitted and filed separately with the Securities and Exchange Commission. Such portions have been marked with “****” at the exact place where material has been omitted.
Exhibit 10.1, 20
* Confidential treatment has been requested for certain portions of this Exhibit. The confidential portions of this Exhibit have been omitted and filed separately with the Securities and Exchange Commission. Such portions have been marked with “****” at the exact place where material has been omitted.
Exhibit 10.1, 21
* Confidential treatment has been requested for certain portions of this Exhibit. The confidential portions of this Exhibit have been omitted and filed separately with the Securities and Exchange Commission. Such portions have been marked with “****” at the exact place where material has been omitted.
Exhibit 10.1, 22
Any notice required under this Agreement to be sent by either Party shall be given in writing by means of a letter or facsimile directed:
If to Q Bio:
c/o Sanders Xxxxxx Xxxxxx-Xxxx Xxxxxxxxxx LLP
000 Xxxxxxx Xxx.
Xxx Xxxx, X.X. 00000
Attn: Xxxxx Xxxxx
Email: xxxxxx@xxxxxxx.xxx
With a copy to:
Xxxxxxx Xxxxxx Xxxxxx-Xxxx Xxxxxxxxxx LLP
000 Xxxxxxx Xxx.
Xxx Xxxx, X.X. 00000
Attn: Xxxxxxx Xxxxxxxxxx
Email: xxx@xxxxxxx.xxx
If to BNI:
Bio-Nucleonics, Inc.
0000 XX Xxxxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxx Xxxxx, XX 00000
Attn: Xx. Xxxx Xxxx
With a copy to:
Xxxxx Day LLP
World Brickell Plaza
000 Xxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxx, Xxxxxxx 00000
Attn: Xx. Xxxxx Xxxxxx
Email: xxxxxxx@xxxxxxxx.xxx
or such other address as may have been specified in writing by either Party to the other. Notice shall be conclusively deemed to have been duly given (a) when hand delivered to another Party; (b) when sent by email, with receipt confirmation, to the address set forth above if sent between 8:00 a.m. and 5:00 p.m. recipient’s local time on a business day, or on the next business day if sent other than between 8:00 a.m. and 5:00 p.m. recipient’s local time on a business day; or (c) the next business day after deposit with an international overnight courier service, postage prepaid, addressed to the applicable Party as set forth above with next business day delivery guaranteed, provided that the sending Party receives a confirmation of delivery from the delivery service provider.
* Confidential treatment has been requested for certain portions of this Exhibit. The confidential portions of this Exhibit have been omitted and filed separately with the Securities and Exchange Commission. Such portions have been marked with “****” at the exact place where material has been omitted.
Exhibit 10.1, 23
This Agreement shall be binding upon and inure to the benefit of the Parties and their respective Affiliates, successors and assigns. This Agreement shall not be assignable by either Party, in whole or in part to any Third Party (subject to Q Bio’s termination rights under Section 13), except that either Party may assign or transfer this Agreement, without consent, to (a) an Affiliate or subsidiary company of that Party or (b) a successor to such Party’s business to which this Agreement relates through any merger, consolidation or reorganization; provided in each case that the entity to whom this Agreement is assigned agrees in writing to be bound by the terms and conditions hereof and that the assignor remains liable for any breach of this Agreement by the assignee or any subsequent assignee.
The Parties are and intend to remain independent contractors. Nothing in this Agreement shall be construed as an agency, business combination, joint venture or partnership between the Parties.
This Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regard or reference to its conflicts of law rules or principles. Any dispute between the Parties in connection with this Agreement (including any question regarding its existence, validity or termination) shall be submitted exclusively to the federal and state courts located in New York County, New York. Each party hereto submits to the jurisdiction of the courts located in New York County, New York. In the event of litigation between the parties in regards to this Agreement, the successful party in terms of such litigation will be entitled to reimbursement of its reasonable legal fees and litigation specific disbursements.
* Confidential treatment has been requested for certain portions of this Exhibit. The confidential portions of this Exhibit have been omitted and filed separately with the Securities and Exchange Commission. Such portions have been marked with “****” at the exact place where material has been omitted.
Exhibit 10.1, 24
The rights and remedies of the parties hereto shall be cumulative. The transactions contemplated by this Agreement are unique transactions and any failure on the part of any party to complete the transactions contemplated by this Agreement on the terms of this Agreement will not be fully compensable in damages and the breach or threatened breach of the provisions of this Agreement would cause the other parties hereto irreparable harm. Accordingly, in addition to and not in limitation of any other remedies available to the parties hereto for a breach or threatened breach of this Agreement, the parties shall be entitled to seek specific performance of this Agreement and seek an injunction restraining any such party from such breach or threatened breach.
* Confidential treatment has been requested for certain portions of this Exhibit. The confidential portions of this Exhibit have been omitted and filed separately with the Securities and Exchange Commission. Such portions have been marked with “****” at the exact place where material has been omitted.
Exhibit 10.1, 25
AS WITNESS, the Parties have caused this Patent and Technology License and Purchase Option Agreement to be signed on the date first written above.
______________________
Name:
Title:
BIO-NUCLEONICS INC.
______________________
Name:
Title:
Exhibit 10.1, 26