LICENSE AGREEMENT
This Agreement, effective as of February 27, 1997 (the "Effective Date"), is by
and between CURE, LLC (hereinafter "CURE"), a corporation organized and existing
under the laws of the State of Maryland and having a place of business at 0000
Xxxxxx Xxxx, Xxxxxx Xxxxxx, Xxxxxxxx 00000 and AXONYX Inc. (hereinafter
"LICENSEE"), a corporation organized and existing under the laws of the State of
Delaware having its principal office at: 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, X.X.
00000.
RECITALS
WHEREAS, CURE has entered into a "PHS PATENT LICENSE
AGREEMENT-EXCLUSIVE"( the "PHS Agreement") dated January 31, 1997 with the
Public Health Service ("PHS") for the licensing of rights in intellectual
property contained in certain United States and foreign patents listed in
Appendix I Patents and Patent Applications, including all U.S. and foreign
rights derived from such patents (collectively the "Patents").
WHEREAS, pursuant to the PHS Agreement CURE has exclusive worldwide
licensing rights to the intellectual property contained in the Patents and is
empowered to enter into sub-licensing agreements covering all or part of the
Patents;
WHEREAS, LICENSEE desires to acquire commercialization rights to certain
of the inventions contained in the Patents in order to develop processes,
methods, and marketable products for public use and benefit;
WHEREAS, subject to the terms and conditions hereinafter set forth, CURE
is willing to grant to LICENSEE and LICENSEE is willing to accept from CURE a
sub-license (as hereinafter defined) covering the Patents;
NOW, THEREFORE, in consideration of the mutual promises and agreements
contained herein, the parties hereto hereby agree as follows:
1. DEFINITIONS.
(a) "Calendar Year" shall mean a consecutive period of twelve
calendar months commencing on the first day of January of any
year.
(b) "Licensed Fields of Use" shall mean all fields of use covered
under the PHS Agreement.
(c) "License" shall mean the exclusive worldwide license to practice
the Licensed Patent Rights (as hereinafter defined) for the
development, manufacture, use and sale of Licensed Products or
Licensed Processes (as hereinafter defined), to the same extent
that CURE has such rights pursuant to the PHS Agreement.
2
(d) "Net Sales" shall mean the total gross receipts for sales of
Licensed Products or practice of Licensed Processes by or on
behalf of LICENSEE or its sub-licensees, and from leasing,
renting or otherwise making Licensed Products available to others
without sale or disposition, whether invoiced or not, less
returns and allowances actually granted, packing costs, insurance
costs, freight out, taxes or excise duties imposed on the
transaction (if separately invoiced), and wholesale or cash
discounts in amounts customary in the trade. No deductions shall
be made for commissions paid to individuals, whether they be with
independent sales agencies or regularly employed by LICENSEE or
sub-licensees, and on its payroll, or for the cost of
collections.
(e) "Licensed Patent Rights" shall mean the rights granted to CURE
under the PHS Agreement.
(f) "Licensed Process(es)" means processes which, in the course of
being practiced would, in the absence of this Agreement, infringe
one or more claims of the Licensed Patent Rights that have not
been held invalid or unenforceable by an unappealed or
unappealable judgment of a court of competent jurisdiction.
(g) "Licensed Product(s)" means tangible materials which, in the
course of manufacture, use, or sale would, in the absence of this
Agreement, infringe one or more claims of the Licensed Patent
Rights that have not been held invalid or unenforceable by an
unappealed or unappealable judgment of a court of competent
jurisdiction.
(h) "Licensed Territory" shall mean worldwide.
(i) "Commercial Development Plan" means the written commercialization
plan, as amended, that is part of the PHS Agreement and that is
attached hereto as Appendix II, which forms an integral part of
this Agreement.
2. EFFECTIVE DATE:
(a) This Agreement shall become effective upon the signing of this
Agreement by both parties and the payment by LICENSEE to CURE of
$ 15,000, of which sum $ 5000 shall be used to reimburse CURE
forthe non-refundable license issue royalty, LICENSEE shall pay
to CURE an additional $ 10,000 six (6) months after the Effective
Date.
(b) Upon this Agreement becoming effective, this Agreement shall
remain in force and effect until it expires or is terminated in
accordance with Section 12 hereof.
3
3. PASS THROUGH OBLIGATIONS FROM PHS AGREEMENT
LICENSEE agrees that the provisions of the PHS Agreement listed in
Paragraph 4.02, and appended hereto as Appendix III, shall be binding
upon LICENSEE as if it were a party to the PHS Agreement. These
specific provisions from the PHS Agreement cover the following:
Reserved Government Rights, Record Keeping, Performance of the
Commercial Development Plan, Indemnification of PHS, and certain
Termination and Modification of Rights provisions.
In addition to the forgoing, if the PHS Agreement shall terminate
pursuant to Section 13 thereof, then at LICENSEE's option, either: (a)
this Agreement also shall terminate; or (b) LICENSEE shall become a
direct licensee of PHS, subject to the approval of PHS and LICENSEE's
acceptance of the additional provisions of the PHS Agreement.
4. GRANT OF LICENSE.
(a) By this Agreement CURE grants to LICENSEE an exclusive license to
practice the Licensed Patent Rights in the Licensed Fields of Use
within the Licensed Territory. The License granted to LICENSEE
herein shall commence upon the Effective Date and shall remain in
force on a country-by-country basis, if not previously terminated
under the terms of this Agreement, for the life of the Patents or
the term of the PHS Agreement, whichever shall be shorter. At
the expiration of the term of this Agreement, the LICENSEE shall
be deemed to have a fully paid License, in perpetuity, in respect
of the Licensed Patent Rights, and no further royalties shall
accrue or be payable by the LICENSEE to CURE in respect thereof.
(b) LICENSEE shall be entitled to grant sub-licenses under the
License on terms and conditions not inconsistent with the terms
and conditions of this Agreement (except that the fees paid for
the sub-license may be different from those set forth in this
Agreement) to qualified third parties for fair consideration and
in an arms-length transaction. Such third parties shall be
deemed qualified if: (a) they have a capitalization of over
$100,000,000, and if they agree to be bound by all of the
applicable material provisions of this Agreement including
specifically the dictates of the Commercial Development Plan, or
(b) if CURE approves of them in writing.
5. PATENTS AND PATENT APPLICATIONS.
LICENSEE agrees that all of the provisions of the PHS Agreement relating
to patent filing, prosecution, and maintenance shall be binding upon
LICENSEE as if it were a party to the PHS Agreement. Subject to those
provisions:
4
(a) At the initiative of LICENSEE or CURE, the parties shall consult
with each other regarding the prosecution of all patent
applications with respect to the Licensed Patent Rights
(c) LICENSEE shall, during the period beginning 36 months after the
Effective Date of this Agreement pay, or cause to be paid to CURE
such sums as CURE shall be required to pay to PHS in connection
with the applications and maintenance of the Patents. Any sums
that LICENSEE shall be obligated to pay to CURE hereunder shall
be paid on the same schedule and terms as the payments that CURE
must make to PHS.
(d) CURE and LICENSEE shall assist, and cause their respective
employees and consultants to assist each other, in assembling
inventorship information and data for the filing and prosecution
of patent applications on inventions pertaining to the Licensed
Patent Rights.
6. PAYMENTS FOR LICENSE.
In consideration for the grant and during the term of the License,
LICENSEE shall pay to CURE:
(a) MILESTONE PAYMENTS:
So that CURE may satisfy its obligations under the PHS Agreement,
LICENSEE will make, or cause to be made certain one time payments
to CURE as set forth below within thirty (30) days of the
achievement of the following technical milestones:
Milestone Payments
--------- --------
On LICENSEE's or its sub-licensee's submission
to the U.S. Food and Drug Administration (FDA)
of the first New Drug Application (NDA) to the
Licensed Products in the Licensed Fields of Use,
or of the corresponding filing in a foreign equivalent
of the FDA, whichever occurs first: $100,000
Upon the first FDA approval of any NDA submitted
to the FDA by LICENSEE or its sub-licensee: $300,000
On the first approval by a foreign counterpart of
the FDA of that country's equivalent of the NDA
submitted by the LICENSEE or its sub-licensee
for the licensed Products in the licensed Field of Use: $200,000
In the event that NDA approval is obtained within six (6) years of the
effective date of the PHS Agreement, the milestone payments on the above
schedule will be
5
reduced to $200,000 for the first NDA approval by the FDA and $150,000
for the first approval by a foreign counterpart of the FDA of that
country's equivalent of the NDA.
(b) ROYALTY PAYMENTS:
(i) SCHEDULE.
LICENSEE shall pay to CURE royalties according to the
following schedule:
With respect to the first $25 million in annual total Net
Sales CURE shall receive a royalty of 3%.
With respect to that portion of the total annual Net
Sales amount that shall exceed $25 million and be less
than or equal to $50 million CURE shall receive a royalty
of 2.5%.
With respect to that portion of the total annual Net
Sales amount that shall exceed $50 million and be less
than or equal to $100 million CURE shall receive a
royalty of 2%.
With respect to that portion of the total annual Net
Sales amount shall exceed $100 million CURE shall
receive a royalty of 1%.
(ii) SUB-LICENSING ROYALTY.
In the event that LICENSEE sub-licences the Licensed
Products and/or Licensed Processes, CURE shall receive as
royalties the larger of either the amount set forth on
the above schedule or 25% of the royalty income received
by LICENSEE pursuant to such sub-license for the first
two years after the first commercial sale in the United
States, Japan, the U.K., Germany, France, Belgium, or
Canada. Subsequent to that initial two-year period CURE
shall receive as royalties the smaller of either the
amount set forth on the above schedule or 25% of the
royalty income received by LICENSEE pursuant to such
sub-license, but not less than 1% of the total annual Net
Sales amount. Should LICENSEE receive any lump sum or
non-royalty based payments pursuant to any sub-license
agreement for the Licensed Products and/or Licensed
Processes other than the above pass-through milestone
payments and any training or research and development
fees earned by LICENSEE, LICENSEE shall pay, or cause to
be paid to CURE 33% of any such payment.
(c) MID-YEAR REPORT.
6
For the purpose of computing the royalties due to CURE
hereunder, the year shall be divided into two parts
ending on June 30 and December 31. Not later than
forty-five (45) days after each December and June in each
Calendar Year or part thereof during the term of the
License, LICENSEE shall submit to CURE a full and
detailed report of royalties and payments due to CURE
under the terms of this Agreement for the preceding half
year (hereinafter "the Half-Year Report"), setting forth
the Net Sales of each of LICENSEE, and each sub-licensee
of LICENSEE and/or lump sum payments and all other
payments or consideration from sub-licensees upon which
such royalties are computed and including at least the
information in LICENSEE's possession that is necessary to
permit CURE to submit the reports required by the PHS
Agreement, including without limitation:
(i) the quantity of Licensed Products and Licensed
Processes used, sold, transferred or otherwise
disposed of on a country-by-country basis;
(ii) the selling price of each Licensed Product and
Licensed Process;
(iii) the deductions permitted under subsection 1 (d)
hereof used to compute Net Sales; and the royalty
computations and payment.
If no royalties or other payments are due a statement
shall be sent to CURE stating such fact. Payment of the
full amount of any royalties or other payments due to
CURE for the preceding half year shall accompany each
Mid-Year Report. LICENSEE shall maintain for a period of
at least five (5) years after the calendar year to which
the information pertains, full, accurate and compete
books and records consistent with sound business and
accounting practices and in such form and detail as to
enable the determination of the amounts due to CURE from
LICENSEE pursuant to the terms of this Agreement.
(d) ANNUAL REPORT.
Within forty-five (45) days after the end of each
Calendar Year or part thereof commencing on the date of
first commercial sale, LICENSEE shall furnish CURE with a
report (hereinafter the "Annual Report"), certified by an
independent certified public accountant, relating to the
royalties and other payments due to CURE pursuant to this
Agreement in respect of the Calendar Year covered by such
Annual Report and containing the same details as those
7
specified in Section 6(c) above in respect of the
Half-Year Report including at least the information in
LICENSEE's possession that is necessary to permit CURE to
submit the reports required by the PHS Agreement.
(e) INSPECTION OF BOOKS.
On reasonable notice and during regular business hours,
CURE or its authorized representative shall each have the
right to inspect the books of accounts, records and other
relevant documentation of LICENSEE, or any of LICENSEE's
sub-licensees to the extant these are made available to
LICENSEE, insofar as they relate to the production,
marketing and sale of the Licensed Products, in order to
ascertain or verify the amount of royalties and other
payments due to CURE hereunder, and the accuracy of the
information provided to CURE in the aforementioned
reports.
(f) MINIMUM ANNUAL PAYMENTS.
So that CURE may satisfy its obligations under the PHS
Agreement, beginning three years after the effective date
of the PHS Agreement and continuing annually thereafter
until this Agreement shall terminate or expire, LICENSEE
agrees that LICENSEE shall pay to CURE a non-refundable
minimum annual payment of ten thousand dollars ($10,000)
for each Calendar Year, pro-rated for any fraction
thereof, until the First Commercial Sale (as defined in
the PHS Agreement) shall have occurred, and thereafter
LICENSEE shall pay to CURE a non-refundable minimum
annual payment of twenty-five thousand dollars ($25,000)
for each Calendar Year, pro-rated for any fraction
thereof. The amount of any royalties on Net Sales that
LICENSEE shall have paid to CURE during such Calendar
Year shall be credited against such minimum annual
payment amount due to CURE hereunder. If LICENSEE shall
fail to make such payment when due CURE shall have the
right solely at its election, upon written notice to
LICENSEE, to either terminate this .Agreement for cause
or to declare the License granted herein to LICENSEE to
be non-exclusive.
(g) Miscellaneous.
LICENSEE shall cause each of its sub-licensees to effect
sales of Licensed Products or Licensed Processes to third
parties on commercially reasonable, arm's length terms.
8
7. METHOD OF PAYMENT.
All royalties and other payments due to CURE hereunder shall be paid to
CURE in United States dollars. Any royalties on transactions in a
foreign currency shall be converted into United States dollars based on
the New York foreign exchange rate quoted in the WALL STREET JOURNAL on
the day that the payment is due, unless LICENSEE's ability to convert
such funds into United States dollars is not lawful or possible, in
which case the CURE may elect to be paid in the local currency or in
United States dollars in an amount to be calculated upon conversion.
8. SCIENTIFIC ADVISORY BOARD.
LICENSEE shall form and maintain form a Scientific Advisory Board
("SAB") to supervise the progress of the Commercial Development Plan.
The SAB shall be composed of members appointed by the LICENSEE and shall
include Xx. Xxxxxxx Xxxxxxxx of CURE.
9. DEVELOPMENT AND COMMERCIALIZATION.
(a) LICENSEE undertakes to use reasonable diligence to carry out the
Commercial Development Plan including but not limited to, the
performance of all efficacy, pharmaceutical, safety,
toxicological and clinical tests, trials and studies and all
other activities necessary to obtain the approval of the FDA for
the production, use and sale of the Licensed Products, all as set
forth in the Commercial Development Plan and within all
timetables set forth therein. LICENSEE further undertakes to
exercise due diligence and to employ its reasonable diligence to
obtain or to cause its sub-licensees to obtain, the appropriate
approvals of the health authorities for the production, use and
sale of the Licensed Products, in each of the other countries of
the world in which LICENSEE or its sub-licensees intend to
produce, use, and/or sell Licensed Products.
(b) Provided that applicable laws, rules and regulations require that
the performance of the tests, trials, studies and other
activities specified in subsection (a) above shall be carried out
in accordance with U.S. FDA Good Laboratory Practices and in a
manner acceptable to the relevant health authorities, LICENSEE
shall carry out such tests, trials, studies and other activities
in accordance with U.S. FDA Good Laboratory Practices or in a
manner acceptable to the relevant foreign health authorities.
Furthermore, the Licensed Products shall be produced in
accordance with U.S. FDA Good Manufacturing Practice ("GMP")
procedures in a facility which has been certified by the FDA as
complying with GMP, provided that applicable laws, rules and
regulations so require.
(c) LICENSEE undertakes to begin the regular commercial production,
use, and sale of the Licensed Products in good faith in
accordance with the
9
Commercial Development Plan and to continue diligently thereafter
to commercialize the Licensed Products and/or Licensed Processes.
(d) LICENSEE shall provide CURE with written reports on all
activities and actions undertaken by LICENSEE to develop and
commercialize the Licensed Products; such reports (the Half-Year
Commercialization Reports) shall be made within forty-five (45)
days after each six (6) months of the duration of this Agreement,
commencing six months after the Effective Date.
(e) If LICENSEE shall not commercialize the Licensed Products within
a reasonable time frame, unless such delay is necessitated by FDA
or other regulatory agencies or unless CURE and LICENSEE have
mutually agreed to amend the Commercial Development Plan, or
because of unforeseen circumstances, including manufacturing
delays out of LICENSEE's control, CURE shall notify LICENSEE in
writing of LICENSEE's failure to commercialize and shall allow
LICENSEE a reasonable period of time thereafter to cure its
failure to commercialize. LICENSEE's failure to cure such delay
to CURE's reasonable satisfaction within such reasonable period
of time shall be a material breach of this Agreement.
10. REVERSIONARY RIGHTS
In the event that LICENSEE fails either to: (a) commence Phase I
testing within three (3) months after the date of approval of an IND,
(b) Phase II testing within nine (9) months of the date of such
approval, (c) Phase III testing within twenty-seven (27) months of the
date of such approval, or (d) submit an NDA for approval in the United
States, Japan, the U.K., Germany, France, Belgium, or Canada within five
(5) years of the date of the IND approval, then CURE may make a written
demand that LICENSEE begin such phase of testing or submit such NDA for
approval, it being understood, however that if the delay in commencing
such phase of testing or obtaining such approval is a result of
difficulties in recruiting clinical research subjects for Phase III
clinical trials, or the result of other similar technical or logistical
difficulties with respect to factors outside of LICENSEE's or its
sub-licensee's control, then CURE shall refrain from making the
aforementioned written demand so long as, in CURE's reasonable judgment,
LICENSEE and/or its sub-licensee is acting in good faith and using its
best efforts to recruit such clinical research subjects, or to address
such other difficulties. If LICENSEE has not commenced such testing or
submitted such NDA application within sixty (60) days after receiving
such demand, and if CURE has not withdrawn its demand, then all rights
to the Patents transferred by this Agreement shall revert to CURE at
CURE's option, as provided below, unless either (i) such delay is
necessitated by the U.S. FDA or other regulatory agencies and LICENSEE
is working diligently to end such delay, or (ii) LICENSEE pays to CURE,
commencing on the sixty-first (61st) day following LICENSEE's receipt of
CURE's notice and continuing monthly thereafter as provided herein, the
sum of: (w) ten thousand dollars ($10,000) per month for up to a
maximum of three (3)
10
months, and twenty-five thousand dollars ($25,000) per month for
up to three (3) months thereafter, for delays in commencing Phase I
testing, (x) fifteen thousand dollars ($15,000) per month for up
to a maximum of three (3) months, and thirty thousand dollars
($30,000) per month for up to three (3) months thereafter, for
delays in commencing Phase II testing, (y) twenty-five thousand dollars
($25,000) per month for up to a maximum of three (3) months, and fifty
thousand dollars ($50,000) per month for up to three (3) months
thereafter, for delays in commencing Phase III testing, or (z) fifty
thousand dollars ($50,000) per month for up to a maximum of three (3)
months, and one hundred thousand ($100,000) per month for each
additional month of delay until such NDA application has been submitted.
If LICENSEE shall fail to pay to CURE the sums set forth above when due,
or in any event if any of the above delays shall continue for more than
six months, then all rights to the Patents transferred by this Agreement
may, at CURE's election, revert to CURE, in which case this Agreement
shall terminate and LICENSEE shall immediately send to CURE exclusively
any and all scientific reports and research developed to that point
pursuant to this Agreement.
11. INFRINGEMENT OF PATENTS.
(a) In the event a party to this Agreement acquires information that
a third party is infringing one or more of the Licensed Patent
Rights the party acquiring such information shall promptly
notify the other party to the Agreement in writing of such
infringement.
(b) In the event of an infringement of the Licensed Patent Rights,
LICENSEE (1) may bring suit in its own name, at its own expense,
and on its own behalf for such infringement; (2) in any such
suit, enjoin infringement and collect for its use, damages,
profits, and awards of whatever nature recoverable for such
infringement; and (3) settle any claim or suit for infringement
of the Licensed Patent Rights, subject in each case to the rights
of CURE, PHS and appropriate Government authorities under
provisions of the PHS Agreement. Should LICENSEE elect to bring
suit against an infringer and CURE is joined as a party plaintiff
in any such suit, CURE shall have the right to approve the
counsel selected by LICENSEE to represent LICENSEE and CURE.
LICENSEE shall not compromise or settle such litigation without
the prior written consent of CURE, which consent shall not be
unreasonably withheld.
(c) Fifty percent of expenses incurred by LICENSEE under this Section
11 (c) including costs, fees, attorney fees, and disbursements,
may be credited against the royalties payable to CURE under this
Agreement in the country in which the suit was filed. In the
event that fifty percent (50%) of such expenses exceed the amount
of royalties payable by LICENSEE in any calendar year, the
expenses in excess may be carried over as a credit on the same
basis into succeeding calendar years. A credit against
litigation expenses, however, may not reduce the royalties due in
any calendar year to less than the minimum annual royalty. Any
recovery made by
11
LICENSEE, through court judgment or settlement, first shall be
applied to reimburse CURE for royalties withheld as a credit
against litigation expenses and then to reimburse LICENSEE for
its litigation expense. Any remaining recoveries shall be shared
equally by LICENSEE and CURE.
(d) If LICENSEE does not bring suit against said infringer pursuant
to Section 11(c) herein, or has not commenced negotiations with
said infringer for discontinuance of said infringement, within
ninety (90) days after LICENSEE becomes aware of such
infringement, CURE or PHS shall have the right, but shall not be
obligated, to bring suit for such infringement. Should CURE
elect to bring suit against an infringer and LICENSEE is joined
as a party plaintiff in any such suit, LICENSEE shall have the
right to approve the counsel selected by CURE to represent CURE
and LICENSEE, and CURE shall hold LICENSEE free, clear and
harmless from and against any and all costs and expenses of such
litigation, including attorneys' fees. If LICENSEE has commenced
negotiations with an alleged infringer of the Licensed Patent
Rights for discontinuance of such infringement within such 90-day
period, LICENSEE shall have an additional ninety (90) days from
the termination of such initial 90-day period to conclude its
negotiations before CURE may bring suit for such infringement.
In the event CURE brings suit for infringement of the Licensed
Patent Rights, CURE shall have the right to first reimburse
itself out of any sums recovered in such suit or settlement
thereof for all costs and expenses of every kind and character,
including reasonable attorneys' fees necessarily involved in the
prosecution of such suit, and if after such reimbursement, any
funds shall remain from said recovery, CURE shall promptly pay to
LICENSEE an amount equal to fifty percent (50%) of such remainder
and CURE shall be entitled to receive and retain the balance of
the remainder of such recovery.
(e) Each party shall always have the right to be represented by
counsel of its own selection in any suit for infringement of the
Licensed Patent Rights instituted by the other party to this
Agreement under the terms hereof. The expense of such counsel
shall be borne by the party initiating such infringement suit.
(f) LICENSEE agrees to cooperate fully with CURE at the request of
CURE, including, by giving testimony and producing documents
lawfully requested in the prosecution of any suit by CURE for
infringement of the CURE Licensed Patent Rights; provided, CURE
shall pay all reasonable expenses (including attorneys' fees)
incurred by LICENSEE in connection with such cooperation. CURE
shall cooperate with LICENSEE at the request of LICENSEE,
including by giving testimony and producing documents lawfully
requested, in the prosecution of any suit by LICENSEE for
infringement of the Licensed Patent Rights; provided that
LICENSEE shall pay all reasonable expenses (including attorneys'
fees) incurred by CURE in connection with such cooperation.
12
12. TERMINATION.
(a) Unless earlier terminated pursuant to Section 9-10 hereof, this
Agreement shall expire upon the expiration of the last to expire
of the Patents.
(b) LICENSEE shall have a unilateral right to terminate this
Agreement and/or any licenses in any country by giving CURE sixty
(60) days notice to that effect, and LICENSEE shall immediately
send to CURE exclusively any and all scientific reports and
research developed to that point pursuant to this Agreement.
Nothing in this paragraph shall limit CURE's right to any payment
owed to it by LICENSEE pursuant Section 10 hereof.
(c) At any time prior to expiration of this Agreement, either party
may terminate this Agreement forthwith for cause, as "cause" is
described below, by giving written notice to the other party.
Cause for termination of this Agreement shall be deemed to exist
if a party materially breaches or defaults in the performance or
observance of any of the provisions of this Agreement and such
breach or default is not cured within ninety (90) days after the
giving of notice specifying such breach or default, or if either
party discontinues its business or becomes insolvent or bankrupt.
(d) Any amount payable hereunder by one of the parties to the other,
which has not been paid by the date on which such payment is due,
shall bear interest from such date until the date on which such
payment is made, at the rate of two percent (2%) per annum in
excess of the prime rate prevailing at Citibank, N.A., in New
York, or the maximum rate then permitted by law if less, during
the period of arrears and such amount and the interest thereon
may be set off against any amount due, whether in terms of this
Agreement or otherwise, to the party in default by any
non-defaulting party.
(e) Upon termination of this Agreement for any reason and prior to
expiration of the Patents as set forth in Section 12 (a) hereof,
all rights in and to the Licensed Patent Rights transferred to
LICENSEE pursuant to this Agreement shall revert to CURE, and
LICENSEE shall not be entitled to make any further use whatsoever
of the Licensed Patent Rights.
(f) Termination of this Agreement shall not relieve either party of
any obligation to the other party incurred prior to such
termination.
(g) Section 16 hereof shall survive and remain in full force and
effect after any termination, cancellation or expiration of this
Agreement.
13. REPRESENTATIONS AND WARRANTIES BY LICENSEE.
LICENSEE hereby represents and warrants to CURE as follows:
13
(1) LICENSEE is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware. LICENSEE
has been granted all requisite power and authority to carry on
its business and to own and operate its properties and assets.
The execution, delivery and performance of this Agreement have
been duly authorized by the Board of Directors of LICENSEE.
(2) There is no pending or, to LICENSEE's knowledge, threatened
litigation involving LICENSEE which would have any effect on this
Agreement or on LICENSEE's ability to perform its obligations
hereunder; and
(3) There is no indenture, contract, or agreement to which LICENSEE
is a party or by which LICENSEE is bound which prohibits or would
prohibit the execution and delivery by LICENSEE of this Agreement
or the performance or observance by LICENSEE of any term or
condition of this Agreement.
14. REPRESENTATIONS AND WARRANTIES BY CURE.
CURE hereby represents and warrants to LICENSEE as follows:
(1) CURE is a corporation duly organized, validly existing and in
good standing under the laws of the State of Maryland. CURE has
been granted all requisite power and authority to carry on its
business and to own and operate its properties and assets. The
execution, delivery and performance of this Agreement have been
duly authorized by the Managing Director of CURE.
(2) There is no pending or, to CURE's knowledge, threatened
litigation involving CURE which would have any effect on this
Agreement or on CURE's ability to perform its obligations
hereunder; and
(3) There is no indenture, contract, or agreement to which CURE is a
party or by which CURE is bound which prohibits or would prohibit
the execution and delivery by CURE of this Agreement or the
performance or observance by CURE of any term or condition of
this Agreement.
15. NO ASSIGNMENT.
Neither LICENSEE nor CURE shall have the right to assign, delegate or
transfer at any time to any party, in whole or in part, any or all of
the rights, duties and interest herein granted without first obtaining
the written consent of the other to such assignment.
14
16. INDEMNIFICATION.
(a) LICENSEE agrees that the Indemnification provision from the PHS
Agreement appended hereto in Appendix III shall be binding upon
LICENSEE as if LICENSEE were a party to that contract, and
LICENSEE hereby agrees to indemnify CURE to the fullest extent
that CURE shall be obligated to indemnify PHS thereunder for
liabilities other than those resulting from CURE's own acts or
omissions.
(b) Each party shall indemnify the other against any and all third
party claims, suits, actions or threats of action, liabilities,
settlement amounts, expenses or costs of any kind, including but
not limited to attorney's fees and costs which result from or
arise out of intentional or negligent actions or omissions,
misconduct or wrongdoing by the indemnifying party in its
performance under this Agreement.
(c) Upon receiving notice of any claim or suit, any indemnitee shall
immediately notify the indemnifying party and shall allow the
indemnifying party and/or its insurer the opportunity to assume
direction and control of the defense of such claim, including
without limitation the settlement thereof at the sole option of
the indemnifying party or its insurer, the conduct of any
negotiations, dispute resolution or litigation of any such claim
or suit; and the indemnifying party shall inform the indemnitee
of the progress of the claim or suit at such time and in such
manner as is reasonable under the circumstances. Notwithstanding
anything to the contrary herein, the LICENSEE, if it is the
indemnified party, shall at all times have the right to assume
the loss and expense of any litigation relating to the Licensed
Product and thereby control the contest and defense thereof.
17. MISCELLANEOUS.
(a) In carrying out this Agreement the parties shall comply with all
local, state and federal laws and regulations.
(b) If any provision of this Agreement is determined to be invalid or
void, the remaining provisions shall remain in effect.
(c) This Agreement shall be deemed to have been made in the State of
New York and shall be governed and interpreted in all respects by
federal law as applied in the Southern District of New York.
(d) Any dispute arising under this Agreement shall be resolved
through binding arbitration under the auspices of the American
Arbitration Association in New York State under federal law as
applied in the Southern District of New York.
15
(e) All payments or notices required or permitted to be given under
this Agreement shall be given in writing and shall be effective
when either personally delivered or deposited, postage prepaid,
in the United States registered or certified mail, addressed as
follows:
To LICENSEE:
AXONYX Inc.
Attention: Xx. Xxxxxx Xxxxxxx,
Chairman
000 Xxxxxx Xx.
X.X. Xxx 000
Xxxxxxxxx XX, 00000
with a copy to:
Xxxxxxx X. Xxxxxx Esq.
000 Xxxx 00xx Xxxxxx
Xxx Xxxx X.X. 00000
To CURE:
CURE, LLC
0000 Xxxxxx Xxxx
Xxxxxx Xxxxxx, Xxxxxxxx 00000
Attention: Xx. Xxxxxxx Xxxxxxxx
with a copy to:
Xxxxx X. Xxxxxx Xx., Esq.
Piper & Marbury L.L.P.
0000 00xx Xxxxxx, X.X.
Xxxxxxxxxx X.X. 00000
or such other address or addresses as either party may hereafter specify
by written notice to the other. Such notices and communications shall be deemed
effective on the date of delivery or fourteen (14) days after having been sent
by registered or certified mail, whichever is earlier.
(f) This Agreement (and the annexed Appendices) constitute the entire
Agreement between the parties and no variation, modification or waiver of any of
the terms or conditions hereof shall be deemed valid unless made in writing and
signed by both parties hereto. This Agreement supersedes any and all prior
agreements or understandings, whether oral or written, between LICENSEE and
CURE.
16
(g) No waiver by either party of any non-performance or violation by
the other party of any of the covenants, obligations or agreements of such other
party hereunder shall be deemed to be a waiver of any subsequent violation or
non-performance of the same or any other covenant, agreement or obligation, nor
shall forbearance by any party be deemed to be a waiver by such party of its
rights or remedies with respect to such violation or non-performance.
(h) The descriptive headings contained in this Agreement are included
for convenience and reference only and shall not be heard to expand, modify or
aid in the interpretation, construction or meaning of this Agreement.
(i) It is not the intent of the parties to create a partnership or
joint venture or to assume partnership responsibility or liability. The
obligations of the parties shall be limited to those set out herein and such
obligations shall be several and not joint.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
effective as of the date and year first above written.
AXONYX Inc. CURE, LLC
By: Xx. Xxxxxx Xxxxxxx By: Xx. Xxxxxxx Xxxxxxxx
/s/ Xxxxxx X. Xxxxxxx, M.D. /s/ Xxxxxxx Xxxxxxxx
--------------------------- ---------------------------
Title: Chairman Title: President
Date: 2-27-97 Date: 3/14/97
-------------------- --------------------
