1
EXHIBIT 10.3
AMENDED AND RESTATED LICENSE AGREEMENT
(OPTIVAX(R))
THIS LICENSE AGREEMENT (this "Agreement") is made and executed as of
October 10, 1996, by and between CYTRX CORPORATION, a Delaware corporation
("CytRx"), and VAXCEL, INC., a Delaware corporation ("Vaxcel").
RECITALS
WHEREAS, CytRx owns certain patents, patent applications, technology
and other rights related to a certain copolymer and its use as a vaccine
adjuvant;
WHEREAS, Vaxcel obtained the exclusive, worldwide license in and to
such rights, in accordance with the terms of a License Agreement dated as of
January 1, 1993 (the "Original Agreement"), and amended as of February 1, 1994,
December 30, 1994, and August 10, 1995, to develop and commercially exploit such
patents, patent applications, technology and other rights in the Field (as
defined below); and
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, CytRx and Vaxcel hereby agree to amend and restate the
Original Agreement, as amended, as follows:
ARTICLE I
DEFINITIONS
1.1 Definitions. Capitalized terms not otherwise defined herein shall
have the meanings set forth below.
"Affiliate," "affiliate" or any variation thereof means, when used with
reference to a specified person, any person or entity directly or indirectly
controlling, controlled by or under common control with the specified person.
For purposes of this Agreement, the direct or indirect ownership of over 50% of
the outstanding voting securities of an entity, or the right to receive over 50%
of the profits or earnings of an entity, or the right to control the policy
decisions of a person or entity, shall be deemed to constitute control.
"Block Copolymer Patent Rights" means CytRx's rights in all information
or discoveries covered by patents and patent applications listed on Exhibit A
hereto, and all patents issuing upon such applications, and all continuations,
continuations-in-part, additions, divisions, renewals, extensions,
reexaminations and reissues of any of the foregoing.
2
"Copolymer" means a certain series of 12,000 kd molecular weight
polyoxyethylene / polyoxypropylene copolymers, as more specifically described on
Exhibit B, and covered by the claims in the Patent Rights.
"Effective Date" means the date specified in the introduction to the
Original Agreement.
"Emory Agreement" means the License Agreement and Amendment dated as of
November 1, 1985, between Emory University and CytRx (formerly known as
SYNTHRx), as further amended on July 22, 1986, August 18, 1986 and January 9,
1992.
"Federal Government Interest" means the rights of the U.S. Government
arising under 35 U.S.C. Section 200 et seq. (which codifies Public Laws 96-517,
97-256 and 98-620) and any regulations issued thereunder, as such statute or
regulations may be amended from time to time hereafter.
"Field" means Regulated Use of the Copolymer or Products as Vaccine
Adjuvants in combination with an antigen in a Vaccine Delivery System (a) in
human animals, and (b) solely for the purpose of conducting research or
preclinical trials by Vaxcel and its Technology partners in non-human animals in
order to predict safety and efficacy in human animals (this arrangement would be
covered under a Materials Transfer, Option, or Sublicense Agreement between
Vaxcel and a third party). The term "Field" excludes any other use of the
Copolymer and Products alone or in combination with any other active ingredient
and specifically excludes, without limitation, (1) the use of the Copolymer and
Products for the delivery and/or protection of genes, oligonucleotides or
therapeutic agents for any in vivo, ex vivo, or in vitro purposes, (2) the use
of the Copolymer and Products alone as non-specific immune stimulants, and (3)
the use of the Copolymer and Products as therapeutic agents to treat infectious
diseases. Notwithstanding clause (2) of the preceding sentence, the Copolymer
may be used (and the term "Field" shall include Regulated Use of the Copolymer)
alone as a prophylactic, non-specific immune stimulant in human animals.
"FDA" means the U.S. Food and Drug Administration or any successor
agency thereto.
"Improvement" means any and all new or useful processes, manufacturing
methods, compositions of matter or methods of use first conceived, reduced to
practice or developed after the Effective Date and during the term of this
Agreement which relate to the manufacture or use of Products and which apply to
the Field.
"Net Sales" as applied to a Product shall mean the gross sales of such
Product by Vaxcel or any Affiliate thereof to an unaffiliated third party, less:
transportation charges to the extent separately identified on the invoice and
included in the gross sales; returns and allowances actually paid or allowed by
Vaxcel; customary discounts (whether in cash or trade); and sales and similar
taxes based on sales prices to the extent included in gross sales, but not
including taxes assessed on income derived from such sales.
- 2 -
3
"Patent Rights" means the Vaccine Patent Rights and the Block Copolymer
Patent Rights.
"Product" or "Products" means the Copolymer and any product containing,
incorporating, based upon or otherwise using the Copolymer or the Technology in
the Field.
"Product Information" means all technical, scientific, business
development and marketing data and information owned or possessed by CytRx on or
before the Effective Date relating to the Copolymer or the Products in the
Field, including (i) all information relating to indications for use and
conditions of the Copolymer in the Field, (ii) the specifications for the
Copolymer, (iii) licensing and similar contacts, and (iv) all other methods,
processes, know-how and trade secrets, whether or not patented or patentable,
which CytRx owns or possesses (to the extent CytRx can furnish such information
without violating any obligation of confidentiality to a third party) on the
Effective Date and which relate to the Copolymer or Products in the Field and
may be useful in the manufacturing, marketing or sale of Products in the Field.
"Regulated Use" means the development, manufacture and sale of any
Product that, at the time Vaxcel begins its development efforts, is subject to
regulations by the FDA (if conducted in the United States), other regulatory
agencies around the world (if conducted outside the United States), or any
successor agencies.
"Technology" means the Patent Rights and the Product Information.
"Vaccine Adjuvant" means the Copolymer or any Product which
specifically enhances the body's immune response to one or more specific
antigen(s) in a vaccine.
"Vaccine Delivery System" means any emulsion or formulation containing
the Copolymer in combination with an antigen, which is intended to elicit an
immune response that is specific for the antigen. The emulsion or formulation
may deliver the combination either immediately or over a period of time, through
any route of administration including, without limitation, an oral, nasal or
pulmonary method or use.
"Vaccine Patent Rights" means CytRx's rights in all information or
discoveries covered by patents and patent applications listed on Exhibit C
hereto, and all patents issuing upon such applications, and all continuations,
continuations-in-part, additions, divisions, renewals, extensions,
reexaminations and reissues of any of the foregoing.
"Valid Claim" means a claim included in an issued patent that has not
expired or been held invalid or unenforceable by a court of competent
jurisdiction in a final and nonappealable or non-appealed judgment or a claim
included in a patent application.
- 3 -
4
ARTICLE II
GRANT OF LICENSE TO VAXCEL;
TRANSFER OF PRODUCT INFORMATION
2.1 License. Subject to the terms and conditions herein, CytRx hereby
grants to Vaxcel a worldwide, royalty-bearing right and license in and to the
Technology to make, have made, use, modify, further develop, improve, market,
sell and otherwise commercially exploit the Products in the Field, and to
practice under the Patents and to use the Product Information in the Field in
connection therewith. The license shall be exclusive, even as to CytRx, subject
to the Federal Government Interest. Vaxcel shall have the right to sublicense
its rights hereunder to the extent consistent with the terms of this Agreement,
including Section 2.4 hereof. Vaxcel shall not have the right to make or have
made the Copolymer but shall have the right to have the Copolymer made on its
behalf by CytRx, in accordance with Section 4.6 hereof.
2.2 Transfer of Product Information. Promptly following the Effective
Date, CytRx shall use all reasonable efforts to make available to Vaxcel a copy
of all Product Information owned or possessed by CytRx on the Effective Date.
2.3 Improvements.
(a) Any and all Improvements made, discovered, developed or
acquired by Vaxcel in the Field ("Vaxcel Improvements") during the term of this
Agreement shall belong to Vaxcel, and Vaxcel shall have exclusive right, title
and interest thereto and shall have no obligation to disclose to CytRx such
Improvements or to permit CytRx to make use of such Improvements. All Vaxcel
Improvements in the Field shall be transferred to CytRx, without charge, upon
termination of this Agreement (except in the case of termination pursuant to
Section 6.1 or because of breach by CytRx pursuant to Section 6.3).
(b) Vaxcel shall promptly notify CytRx, in writing, of any
Improvement outside the Field. All Improvements made, discovered, developed or
acquired by Vaxcel outside the Field during the term of this Agreement shall
belong to Vaxcel, but CytRx shall have the right to license any such Improvement
on an exclusive, worldwide basis, on terms no less favorable to CytRx than the
terms of this Agreement. CytRx's right of first refusal shall terminate 180 days
after Vaxcel has fully disclosed the Improvement and all corresponding data to
CytRx in writing, but in no event may Vaxcel subsequently license the
Improvement to any person on terms less favorable than those offered to CytRx,
without first allowing CytRx the opportunity to license the Improvement on the
more favorable terms.
- 4 -
5
2.4 Sublicensing of Technology. The right of Vaxcel to grant
sublicenses to third parties under Section 2.1 hereof is subject to the
following conditions:
(a) Vaxcel shall forward to CytRx, within thirty (30) days
after execution of a sublicense, option, or similar agreement, a complete and
accurate written copy of each executed agreement hereunder;
(b) In each such sublicense, the sublicensee shall acknowledge
that it is subject to all of Vaxcel's duties and obligations contained in this
Agreement;
(c) Notwithstanding any sublicense to the contrary, Vaxcel
shall remain responsible to CytRx for all of Vaxcel's and its Sublicensees'
duties and obligations contained in this Agreement;
(d) Upon the occurrence of an Event of Default under Section
6.2(a), all payments then or thereafter due and owing to Vaxcel from any of its
sublicensees shall upon notice from CytRx to any such sublicensee become payable
directly to CytRx by such sublicensee for the account of Vaxcel; provided,
however, that CytRx shall remit to Vaxcel the amount by which such payments
exceed the amounts owed by Vaxcel to CytRx under this Agreement or otherwise,
less any costs of collection plus interest for late payment per Section 3.7 (if
any); and
(e) Each sublicense shall provide for its assignment to CytRx,
at the option of CytRx, in the event of termination of this Agreement for any
reason (other than termination pursuant to Section 6.1 or because of breach by
CytRx pursuant to Section 6.3).
ARTICLE III
ROYALTIES, ETC.
3.1 Royalties. In consideration of the licenses granted under Article
II, Vaxcel shall pay a royalty to CytRx on every direct sale of the Product by
Vaxcel or its Affiliates in any country for the longer of (a) ten years from the
first commercial sale of the Product in that country, or (b) for so long as the
manufacture or sale of the Product is subject to a Valid Claim in such country.
The royalty shall be equal to ten percent (10%) of the Net Sales of such
Product. A sale of a Product shall be deemed to occur upon the earlier of (i)
shipment of a Product by Vaxcel or its Affiliates to an unaffiliated party, or
(ii) transfer of title to the Product to the buyer.
3.2 Sublicense Compensation. If Vaxcel sublicenses any or all of its
rights hereunder to an unaffiliated third party, Vaxcel shall pay to CytRx a
royalty of fifteen percent (15%) of all compensation received by Vaxcel from the
sublicensee, whether denominated as license fees, milestone payments, approval
fees, royalty income or otherwise. Furthermore, any compensation above Vaxcel's
fully allocated cost of either
- 5 -
6
chemical sales or R&D revenue received by Vaxcel will be considered sublicense
compensation for the purposes of calculating the CytRx payment. Notwithstanding
the foregoing, however, sublicense compensation shall not include government
grants or purchases of Vaxcel equity by an unaffiliated third party.
3.3 Third Party Royalties. CytRx shall be responsible for any royalties
payable as a result of this Agreement, if any, pursuant to the Emory Agreement,
any royalties payable to BASF, if any, pursuant to an Agreement dated as of May
22, 1986, as such may be amended, between CytRx and BASF Corporation (the "BASF
Agreement"). Vaxcel shall be responsible for any other royalties or similar
payments owed to third parties as a result of Vaxcel's commercialization of
Products under this Agreement.
3.4 Payment of Royalties. Royalties payable to CytRx under Section 3.1
or 3.2 shall be due for each calendar quarter beginning with the first calendar
quarter in which a sale of any Product occurs or sublicense cash compensation is
received from any third party and shall be payable to CytRx within thirty (30)
days following the last day of the applicable calendar quarter.
3.5 Reports. Vaxcel shall deliver to CytRx within thirty (30) days
after the end of each calendar quarter a report, certified by the chief
financial officer of Vaxcel, setting forth in reasonable detail the calculation
of the royalties payable to CytRx for such calendar quarter, including the Net
Sales on a Product-by-Product and country-by-country basis, and all royalty
income received from sublicensees of Vaxcel.
3.6 Currency and Place of Payment.
(a) All payments to CytRx under this Agreement shall be made
by wire transfer in immediately available funds in legal currency of the United
States and shall be delivered to CytRx at the account designated in writing by
CytRx from time to time.
(b) With respect to sales of Products made in a currency other
than United States dollars, royalties shall be computed based upon the same
conversion rate of the currencies of sales into United States dollars as is
published in The Wall Street Journal (Eastern Edition) as of the last business
day of the calendar quarter included in the report.
(c) In the event that Vaxcel is prevented from making any
royalty payment under this Agreement by virtue of restrictions on currency
conversion or repatriation under the statutes, laws, codes or governmental
regulations of the country from which the payment is to be made, then such
royalty payments may be paid by depositing them in the currency in which accrued
to CytRx's account in a bank acceptable to CytRx in the country whose currency
is involved. If the local currency can not be converted or remitted to CytRx
within twelve (12) months from the initial deposit, Vaxcel shall pay CytRx the
equivalent of such amount (including any interest earnings) in United
- 6 -
7
States dollars, and the local currency shall be transferred to an account in a
bank acceptable to Vaxcel in that country.
3.7 Late Payment. Payments hereunder shall be deemed paid as of the day
on which they are received at the account designated pursuant to Section 3.6.
Any part of a royalty which is not paid on or before the date when due shall
accrue interest thereon from such date until the date of its payment in full at
three (3) percentage points over the per annum interest rate published as the
"Prime Rate" in The Wall Street Journal (Eastern Edition), but in no event shall
such rate exceed the maximum rate permitted by applicable law.
3.8 Records. Vaxcel agrees to maintain for five (5) years after the
submission of each report under Section 3.5 hereof full and accurate books and
records in sufficient detail to enable the royalties payable hereunder to be
verified, and to require any Affiliate or sublicensee to do the same. Upon
reasonable prior notice to Vaxcel, CytRx and its certified public accountants
shall have access to the books and records of Vaxcel to conduct a review or
audit thereof. Such access shall be available not more than once each calendar
year, during normal business hours, during the term of this Agreement and for a
period of three (3) years after its expiration or termination.
3.9 No Set-Offs or Counterclaims. Under no circumstances shall any
amount payable to CytRx under this Agreement be reduced, whether by set-off,
counterclaim, adjustment or otherwise, by virtue of any claim against Vaxcel
asserted or alleged by Vaxcel, any of its Affiliates, any assignees,
sublicensees or any other party, or any other person.
ARTICLE IV
CERTAIN RESPONSIBILITIES OF THE PARTIES
4.1 Development Responsibility. Vaxcel shall be responsible for
determining a commercialization strategy and for conducting, at its cost and
expense, all activities relating to the development, manufacture and marketing
of the Products including, without limitation, the conduct of preclinical and
clinical testing, product registration activities, the establishment of a sales
force or distribution network, and the promotion and sale of Products.
4.2 Commercialization of Products and Indications. Vaxcel shall
commercialize the Products as promptly as practicable, consistent with
commercially reasonable practice. Vaxcel shall provide CytRx with semi-annual
updates (which may be oral, unless CytRx requires a written update), in
reasonable detail, describing the progress of the development and
commercialization of the Products and the development activities in the Field.
In addition, representatives of CytRx and Vaxcel shall meet not less frequently
than twice each calendar year to review and discuss the development and
commercialization activities of Vaxcel with respect to the Products.
- 7 -
8
4.3 Government Approvals. Vaxcel shall be responsible, at its cost and
expense, for obtaining and maintaining all approvals, licenses, registrations or
authorizations, including pricing and reimbursement approvals, of any U.S. or
non-U.S. national, state or local regulatory agency, department, bureau or other
government entity, including the FDA and USDA, necessary for the manufacture,
use, storage, transport or sale of Products sold by or on behalf of Vaxcel. All
such approvals, registrations and authorizations shall be in the name of Vaxcel.
4.4 Assistance by CytRx. Vaxcel may request the assistance of CytRx in
the development and commercialization activities related to the Product. If
CytRx agrees to provide any such assistance, the services provided by CytRx
employees shall be paid by Vaxcel in accordance with the Services and Facilities
Agreement between CytRx and Vaxcel effective as of January 1, 1993 (the
"Services Agreement"), unless otherwise agreed to in writing by the parties.
4.5 Drug Master File. CytRx shall be responsible for preparing and
maintaining a Drug Master File on the Copolymer (the "DMF") and submitting said
DMF to the FDA and certain international regulatory agencies, as designated by
Vaxcel. CytRx may request the assistance of Vaxcel in the preparation and
maintenance of the DMF. Unless otherwise agreed to in writing by CytRx and
Vaxcel, the services provided by CytRx employees in connection with any such
assistance shall be paid by Vaxcel in accordance with the Services Agreement.
CytRx shall maintain ownership of the DMF and shall allow Vaxcel and its third
party sublicensee(s) access to the DMF for confidential regulatory purposes.
4.6 Supply of the Copolymer by CytRx; Finished Chemical Product. CytRx
shall supply Vaxcel's requirements of the Copolymer in accordance with the terms
of the Amended and Restated Supply Agreement between CytRx and Vaxcel effective
as of August 10, 1995.
4.7 Non-Competition.
(a) During the term of this Agreement and for five years
thereafter Vaxcel shall not, directly or indirectly, develop, market, sell or
distribute any product in the CytRx Field. For purposes of this Agreement, the
term "CytRx Field" means use of surfactant, surfactant-like, and
glycosaminoglycan molecules and all derivatives, modifications, analogues and
variations thereof, as biologically active agents. These molecules include
poloxamers, poloxamines, tetronics, ethoxylated fatty acids, tritons, tweens,
and all derivatives, modifications, analogues and variations thereof.
(b) During the term of this Agreement, CytRx shall not, and
shall not license other persons to, directly or indirectly, develop, market,
sell or distribute any product that consists of a
polyoxyethylene/polyoxypropylene copolymer in the Field; provided, however, that
for the purposes of this Section 4.7(b) only, "Field" shall not
- 8 -
9
include (and this Section 4.7(b) shall not apply to) sales of TiterMax or any
successor brands for vaccine research in non-human animals.
ARTICLE V
PROTECTION OF LICENSED TECHNOLOGY
5.1 Prosecution of Patents.
(a) From and after the Effective Date, Vaxcel shall be
responsible, at its cost and expense, for prosecuting to issuance all patent
applications, for filing and prosecuting all patent reissues and
re-examinations, for applying for and obtaining any patent term extensions, and
for paying all maintenance fees, on all applications and patents which
constitute Vaccine Patent Rights under this Agreement. CytRx shall retain
responsibility for such obligations as they relate to the Block Copolymer Patent
Rights.
(b) Each party shall cooperate with the other party including,
without limitation, executing all lawful papers and instruments and making all
rightful oaths and declarations, as may be necessary in the preparation and
prosecution of all such patents and other protections related to the Technology.
(c) In the event Vaxcel should elect not to continue the
prosecution of any patent application, patent reissue or patent re-examination,
to apply for a patent extension, or to pay a patent maintenance fee that relates
to the Vaccine Patent Rights, Vaxcel shall notify CytRx of such decision at
least forty-five (45) days in advance of the due date for such action or
payment, and CytRx shall have the right, but not the obligation, to assume
Vaxcel's responsibility therefor, but upon such notice from Vaxcel such patents
or applications shall be excluded from the definition of Vaccine Patent Rights
under this Agreement.
5.2 Infringement of Patents.
(a) Each party shall promptly give written notice to the other
party of any infringement or possible infringement of any of the Technology by a
third party.
(b) Vaxcel shall be responsible, at its discretion and at its
cost and expense, for prosecuting any such infringement. In such event, CytRx
shall cooperate with Vaxcel, at Vaxcel's expense. Vaxcel shall not settle or
compromise any such suit in a manner that imposes any obligations or
restrictions on CytRx or grants any rights to the Technology, without CytRx's
prior written consent (which consent shall not be unreasonably withheld).
Notwithstanding the above, CytRx may (at its expense) elect to prosecute any
infringement of the Block Copolymer Patent Rights and Vaxcel shall cooperate
with CytRx.
- 9 -
10
(c) If Vaxcel fails to prosecute such infringement in a
reasonable period of time (but in no event later than sixty (60) days after
CytRx receives notice thereof), CytRx shall have the right, but not the
obligation, to prosecute such infringement at its own expense, but such
Technology shall be excluded from the definition of Technology under this
Agreement. In such event, Vaxcel shall cooperate with CytRx, at CytRx's expense.
(d) Any recovery obtained by the prosecuting party as the
result of such proceeding, by settlement or otherwise, shall be applied first,
to the prosecuting party, in an amount equal to its costs and expenses of the
litigation. Any remaining damage award shall be allocated 80% to the party
prosecuting the claim and 20% to the non-prosecuting party.
ARTICLE VI
TERMINATION
6.1 Term. This Agreement shall begin on the Effective Date and, unless
sooner terminated under this Article VI, shall expire upon the later of ten
years after the first commercial sale of the initial Product, or expiration of
the last-to-expire patent included in the Patent Rights.
6.2 Termination by CytRx.
(a) Upon the occurrence of any of the events set forth below
("Events of Default"), CytRx shall have the right to terminate this Agreement by
giving written notice of termination, such termination to be effective with the
giving of such notice:
(1) nonpayment of any amount payable to CytRx that is
continuing thirty (30) calendar days after CytRx gives Vaxcel written notice of
such nonpayment;
(2) breach by Vaxcel of any covenant (other than a
payment covenant included in clause (1)) or of any representation or warranty
contained in this Agreement that is continuing sixty (60) calendar days after
CytRx gives Vaxcel written notice of such breach;
(3) Vaxcel becomes insolvent, or voluntary or
involuntary proceedings by or against Vaxcel are instituted in bankruptcy or
under any insolvency law, or a receiver or custodian is appointed for Vaxcel, or
proceedings are instituted by or against Vaxcel for corporate reorganization or
the dissolution of Vaxcel, which proceedings, if involuntary, shall not have
been dismissed within sixty (60) days after the date of filing, or Vaxcel makes
an assignment for the benefit of creditors;
- 10 -
11
(4) the cessation of operations by Vaxcel (other than
pursuant to a merger, reorganization or consolidation in which Vaxcel is not the
surviving corporation or a sale by Vaxcel of all or substantially all of its
assets);
(5) the seizure or attachment of all or substantially
all of the assets of Vaxcel, in conjunction with any action against it by any
third party, which seizure or attachment is not released within forty-five (45)
days after such seizure or attachment and which is contested in good faith by
Vaxcel;
(6) the failure of Vaxcel or any sublicensee thereof
to have used its best efforts to file a Product License Application ("PLA") with
the FDA by the seventh anniversary of the Effective Date for a Product that
under applicable FDA rules and regulations does not require a full-scale
efficacy trial prior to the filing of the PLA;
(7) the failure of Vaxcel or any sublicensee thereof
to have used its best efforts to make any commercial sales of a Product in the
United States, Europe or Japan by the eighth anniversary of the Effective Date;
or
(8) Vaxcel at any time discontinues the marketing and
sale of all Products under this Agreement.
(b) No exercise by CytRx of any right of termination will
constitute a waiver of any right of CytRx for recovery of any moneys then due to
it hereunder or any other right or remedy CytRx may have by law or by this
Agreement.
6.3 Termination by Vaxcel. Vaxcel shall have the right to terminate
this Agreement upon sixty (60) calendar days notice to CytRx upon breach by
CytRx of any covenant, representation or warranty that is continuing sixty (60)
calendar days after Vaxcel gives CytRx written notice of such breach.
6.4 No Other Events of Termination. This Agreement shall terminate or
otherwise be deemed to end if and only if the expiration or termination is
effected pursuant to Sections 6.1, 6.2 or 6.3 hereof.
6.5 Rights and Duties Upon Termination. Within 30 days after
termination of this Agreement under Sections 6.2 or 6.3:
(a) Each party shall return to the other party any trade
secrets or confidential information of the other party received pursuant to this
Agreement or otherwise.
(b) Vaxcel also shall deliver to CytRx all Technology which is
embodied in physical form, together with any and all promotional materials and
other data, information, test results, marketing information, customer lists and
records, distributor lists and records, sales data and projections and any other
information under
- 11 -
12
Vaxcel's control that is related to the manufacture, marketing or sale of
Product or Copolymer.
(c) Upon termination of this Agreement by CytRx (except
termination for breach by Vaxcel), Vaxcel may sell remaining inventory and
finished goods for a period not to exceed six (6) months, subject to the royalty
obligations and other provisions of this Agreement.
6.6 Survival of Contents. Notwithstanding anything else in this
Agreement to the contrary, the parties agree that Vaxcel's obligation to pay any
royalties accrued but unpaid prior to such termination shall survive the
termination of this Agreement. In addition, Sections 2.3, 4.7(a), 5.2, 6.5, 7.1
and 7.2(a) and this Section 6.6 and Articles IX and X shall survive the
termination of this Agreement, together with any other provisions to the extent
required for the full observation and performance of the surviving terms by any
or all of the parties hereto.
ARTICLE VII
CERTAIN COVENANTS
7.1 Proprietary Information.
(a) Non-Disclosure Covenant. Trade Secrets and Confidential
Information and all physical embodiments thereof received by one party (the
"Receiving Party") from the other (the "Disclosing Party") during the term of
this Agreement are confidential to and are and will remain the sole and
exclusive property of the Disclosing Party. At all times, both during the term
of this Agreement and after its termination, Receiving Party shall hold all
Trade Secrets of Disclosing Party in confidence, and will not use, copy or
disclose such Trade Secrets, or any physical embodiment thereof, or cause any of
such Trade Secrets to lose their character as Trade Secrets. At all times during
the term of this Agreement and for a period of three (3) years following its
termination, Receiving Party shall hold the Confidential Information of
Disclosing Party in confidence, and will not use, copy or disclose such
Confidential Information, or any physical embodiments thereof, or cause any of
such Confidential Information to lose its character or cease to qualify as
Confidential Information.
(b) Security Measures. Trade Secrets and Confidential
Information shall be maintained under secure conditions by Receiving Party,
using reasonable security measures and in any event (1) not less than the same
security measures used by Receiving Party for the protection of its own trade
secrets and confidential information of a similar kind, and (2) any specific
security measures required by Disclosing Party. Receiving Party shall not
remove, obscure, or deface any proprietary legend relating to the Disclosing
Party's rights, on or from any tangible embodiment of any Trade Secrets or
Confidential Information without the Disclosing Party's prior written consent.
- 12 -
13
(c) Disclosure Ordered by Government Bodies. If Receiving
Party is ordered by a court, administrative agency, or other governmental body
of competent jurisdiction to disclose Trade Secrets or Confidential Information,
or if it is served with or otherwise becomes aware of a motion or similar
request that such an order be issued, then Receiving Party will not be liable to
Disclosing Party for disclosure of Trade Secrets or Confidential Information
required by such order if Receiving Party complies with the following
requirements: (1) if an already-issued order calls for immediate disclosure,
then Receiving Party shall immediately move for or otherwise request a stay of
such order to permit Disclosing Party to respond as set forth in this Section
7.1(c); (2) Receiving Party shall immediately notify Disclosing Party of the
motion or order by the most expeditious possible means; and (3) Receiving Party
shall join or agree to (or at a minimum shall not oppose) a motion or similar
request by Disclosing Party for an order protecting the confidentiality of the
Trade Secrets and Confidential Information including joining or agreeing to (or
nonopposition to) a motion for leave to intervene by Disclosing Party.
(d) Reports of Misappropriation by Others. Receiving Party
shall immediately report to Disclosing Party any attempt by any person of which
Receiving Party has knowledge (1) to use or disclose any portion of the Trade
Secrets or Confidential Information without authorization from Disclosing Party,
or (2) to copy, reverse assemble, reverse compile or otherwise reverse engineer
any part of such materials (except as permitted herein).
(e) Trade Secrets Defined. "Trade Secrets" means information
related to Disclosing Party (1) which derives economic value, actual or
potential, from not being generally known to or readily ascertainable by other
persons who can obtain economic value from its disclosure or use, and (2) which
is the subject of efforts that are reasonable under the circumstances to
maintain its secrecy. . (f) Confidential Information Defined. "Confidential
Information" means information that is (1) confidential to the business of
Disclosing Party, (2) is designated and identified as such by Disclosing Party,
and (3) is not a Trade Secret; provided, however, that Confidential Information
does not include:
(1) any information that is at the time of receipt by
Receiving Party or thereafter becomes part of the public domain (through
publication or otherwise);
(2) any information that was independently known to
Receiving Party prior to receipt thereof from Disclosing Party, as evidenced by
written records of Receiving Party;
(3) any information that was disclosed to Receiving
Party by a third party having the right to disclose such information; or
(4) information that is required to be disclosed by
Receiving Party by proper order of a court or administrative body, but prior to
such disclosure Receiving Party must notify Disclosing Party of its belief that
disclosure is required.
- 13 -
14
Notwithstanding the foregoing, it is understood that Receiving Party
may disclose Trade Secrets and Confidential Information to its consultants,
outside contractors, clinical investigators and agents if such persons agree to
keep such information confidential to the same extent Receiving Party is so
obligated hereunder, and agree to use such information only for such purposes as
Receiving Party is authorized to use such information.
7.2 Certain Trademark Matters.
(a) Vaxcel shall have the right and the obligation, at its
sole cost and expense, to select, register, prosecute, maintain and defend all
trademarks used with Products under this Agreement. Upon termination of this
License Agreement by CytRx under Section 6.2 hereof, Vaxcel shall transfer and
assign such trademarks and any registrations relating thereto to CytRx or
CytRx's designee.
(b) CytRx shall be entitled to use and refer to Vaxcel's
trademarks in CytRx's reports to stockholders, registration statements, private
placement memoranda and similar corporate documents and records, without
obligation to Vaxcel.
7.3 Compliance with Laws. Vaxcel shall comply with all applicable laws,
rules and regulations pertaining to the use of the Technology and the
development, marketing, advertising and distribution of the Products.
7.4 Taxes. All taxes, assessments and fees of any nature levied or
incurred on account of any payments accruing under this Agreement, by national,
state or local governments, will be assumed and paid by Vaxcel, except taxes
levied thereon as income to CytRx, and if such taxes are required to be withheld
by Vaxcel, they will be deducted from such payments due to CytRx and will be
paid by Vaxcel for the account of CytRx, a receipt thereof secured, if available
and sent to CytRx. If for any reason CytRx cannot credit such withholding tax in
a particular country against the Federal income taxes paid by CytRx, Vaxcel
shall increase the royalty in such country to provide CytRx with a net amount
equal to the royalty that would have been paid absent such withholding tax.
7.5 Press Releases. Vaxcel shall provide CytRx with the prior
opportunity to approve any press release or similar public announcement
concerning this Agreement, the Technology or the Products, as soon as
practicable but in no event later than 24 hours before the announcement is made.
CytRx acknowledges that its opportunity to review and approve press
announcements is subject to and may be limited by any securities laws to which
Vaxcel may be subject that require immediate disclosure.
- 14 -
15
ARTICLE VIII
DISCLAIMERS
8.1 No Warranty. EXCEPT AS EXPRESSLY SET FORTH IN SECTION 11.1 HEREOF,
CYTRX MAKES NO EXPRESS OR IMPLIED WARRANTIES, STATUTORY OR OTHERWISE, CONCERNING
THE TECHNOLOGY, THE PRODUCTS OR ANY INFORMATION COMMUNICATED TO VAXCEL BY CYTRX.
SPECIFICALLY, BUT WITHOUT LIMITING THE FOREGOING, CYTRX MAKES NO EXPRESS OR
IMPLIED WARRANTY OF MERCHANTABILITY, FITNESS (FOR A PARTICULAR PURPOSE OR
OTHERWISE), QUALITY OR USEFULNESS OF THE TECHNOLOGY OR THE PRODUCTS. THE RIGHTS
GRANTED HEREUNDER ARE GRANTED ON AN "AS IS" BASIS. CytRx does not warrant the
accuracy of any information included within the Technology nor does CytRx
warrant that any such information constitutes Trade Secrets or Confidential
Information or that the Technology will be free from claims of infringement by
third parties or any other rights of third parties. Under no circumstances shall
CytRx be liable to Vaxcel or any third party for consequential damages in tort
or contract or otherwise incurred by Vaxcel or any third party.
ARTICLE IX
INDEMNITY
9.1 Indemnification by Vaxcel. Vaxcel will indemnify and hold harmless
CytRx and its Affiliates, employees, officers, directors, stockholders and
agents (a "CytRx Indemnified Party") from and against any and all liability,
loss, damages, costs, or expenses (including reasonable attorneys' fees) which
the CytRx Indemnified Party may incur, suffer or be required to pay resulting
from or arising in connection with (a) the breach by Vaxcel of any covenant,
representation or warranty of Vaxcel contained in this Agreement, (b) the
manufacturing, marketing, sale or distribution of any Product by Vaxcel or any
person on behalf of Vaxcel, (c) the use by any person of any Product that was
manufactured, marketed, sold or distributed by Vaxcel or any Affiliate or
sublicensee, (d) any contamination of or defect in any Product, (e) the use by
Vaxcel or any Affiliate or sublicensee of the Technology or the Products, or (f)
the successful enforcement by a CytRx Indemnified Party of any of the foregoing.
9.2 Indemnification by CytRx. CytRx will indemnify and hold harmless
Vaxcel and its Affiliates, employees, officers, directors, shareholders and
agents (a "Vaxcel Indemnified Party") from and against any and all liability,
loss, damages, costs or expenses (including reasonable attorneys' fees) which
the Vaxcel Indemnified Party may incur, suffer or be required to pay resulting
from or arising in connection with (a) the breach by CytRx of any covenant,
representation or warranty of CytRx contained in this Agreement, or (b) the
successful enforcement by a Vaxcel Indemnified Party of any of the foregoing.
- 15 -
16
9.3 Conditions to Indemnification. The obligations of the indemnifying
party under Sections 9.1 and 9.2 are conditioned upon the prompt notification to
the indemnifying party of any of the aforementioned suits or claims in writing
within fifteen (15) days after receipt of notice by the indemnified party of
such suit or claim. The indemnifying party shall have the right to assume the
defense of any such suit or claim unless, in the reasonable judgment of the
indemnified party, such suit or claim involves an issue or matter which could
have a materially adverse effect on the business, operations or assets of the
indemnified party, in which event the indemnified party may control the defense
or settlement thereof. If the indemnifying party defends the claim, the
indemnified party may participate in the defense of such suit or claim at its
sole cost and expense. This provision for indemnification shall be void and
there shall be no liability against a party as to any suit or claim for which
settlement or compromise or an offer of settlement or compromise is made without
the prior consent of the indemnifying party.
ARTICLE X
JURISDICTION
10.1 Jurisdiction. Each party irrevocably and unconditionally (a)
agrees that any suit, action or other legal proceeding under this Agreement may
be brought in the United States District Court for the Northern District of
Georgia or, if such court does not have jurisdiction or will not accept
jurisdiction, in any court of general jurisdiction in ▇▇▇▇▇▇ County, Georgia;
(b) consents to the jurisdiction of any such court in any such suit, action or
proceeding; and (c) waives any objection that it may have to personal
jurisdiction or the laying of venue of any such suit, action or proceeding in
any such court.
ARTICLE XI
REPRESENTATIONS AND WARRANTIES
11.1 Representations and Warranties of CytRx. CytRx represents and
warrants to Vaxcel as follows:
(a) It is a corporation duly organized, validly existing and
in good standing under the laws of the State of Delaware.
(b) The execution and delivery of this Agreement have been
duly and validly authorized, and all necessary action has been taken to make
this Agreement a legal, valid and binding obligation of CytRx enforceable in
accordance with its terms.
(c) The execution and delivery of this Agreement and the
performance by CytRx of its obligations hereunder will not contravene or result
in any breach of the
- 16 -
17
Certificate of Incorporation or Bylaws of CytRx or result in any material breach
or violation of or material default under any material agreement, indenture,
license, instrument or understanding or, to the best of its knowledge, result in
any violation of any law, rule, regulation, statute, order or decree to which
CytRx or any of its Affiliates is a party or by which any of them or any of
their property is subject.
(d) CytRx has not received notice of any claim that the
Copolymer or any of the Products or Patent Rights infringe upon any third
party's know-how, patent or other intellectual property rights.
(e) CytRx is the exclusive owner or licensee of all rights in
and to the Technology, subject to the Federal Government Interest, the rights of
Emory under the Emory Agreement, and the rights of BASF under the BASF
Agreement.
11.2 Representations and Warranties of Vaxcel. Vaxcel represents and
warrants to CytRx as follows:
(a) Vaxcel is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of Delaware.
(b) The execution and delivery of this Agreement have been
duly and validly authorized, and all necessary action has been taken to make
this Agreement a legal, valid and binding obligation of Vaxcel enforceable in
accordance with its terms.
(c) The execution and delivery of this Agreement and the
performance by Vaxcel of its obligations hereunder will not contravene, or
result in any breach of, the Certificate of Incorporation or Bylaws of Vaxcel,
or result in any material breach or violation of or material default under any
material agreement, indenture, license, instrument or understanding or, to the
best of its knowledge, result in any violation of any law, rule, regulation,
statute, order or decree to which Vaxcel or any of its Affiliates is a party or
by which any of them or any of their property is subject.
ARTICLE XII
MISCELLANEOUS
12.1 Entire Agreement: Amendment. This Agreement, together with the
Exhibits annexed hereto sets forth and constitutes the entire agreement between
the parties hereto with respect to the subject matter hereof, and supersedes any
and all prior agreements, understandings, promises, and representations made by
either party to the other concerning the subject matter hereof and the terms
applicable hereto. This Agreement may not be released, discharged, amended or
modified in any manner except by an instrument in writing signed by duly
authorized representatives of Vaxcel and CytRx.
- 17 -
18
12.2 Parties Independent. In making and performing this Agreement, the
parties act and shall act at all times as independent entities and nothing
contained in this Agreement shall be construed or implied to create an agency,
partnership or employer and employee relationship between Vaxcel and CytRx.
Except as specifically provided herein, at no time shall either party make
commitments or incur any charges or expenses for or in the name of the other
party.
12.3 Effect of Invalidity of Certain Provisions. Any term or provision
of this Agreement which is invalid or unenforceable in any jurisdiction shall,
as to such jurisdiction, be ineffective to the extent of such invalidity or
unenforceability without rendering invalid or unenforceable the remaining terms
and provisions of this Agreement.
12.4 Governing Law. This Agreement shall be deemed to have been entered
into and shall be construed and enforced in accordance with the laws of the
State of Delaware.
12.5 Waivers. The failure of either party to insist, in any one or more
instances, upon the performance of any of the terms, covenants or conditions of
this Agreement and to exercise any right hereunder, shall not be construed as a
waiver or relinquishment of the future performance of any such term, covenant or
condition or the future exercise of such right, but the obligations of the other
party with respect to such future performance shall continue in full force and
effect.
12.6 Headings. The headings of the articles, sections and paragraphs
used in this Agreement are included for convenience only and are not to be used
in construing or interpreting this Agreement.
12.7 Notice. Any notice or other communication required or permitted to
be made or given to either party hereto pursuant to this Agreement shall be
sufficiently made or given if sent to such party by either telecopy transmission
or certified or registered first class mail, postage prepaid, return receipt
requested addressed to it as follows:
If to CytRx:
CytRx Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
FAX No. (▇▇▇) ▇▇▇-▇▇▇▇
Attention: President
with a copy to:
▇▇▇▇▇▇ & Bird
One Atlantic Center
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
FAX No. (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
- 18 -
19
If to Vaxcel:
Vaxcel, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
FAX No. (▇▇▇) ▇▇▇-▇▇▇▇
Attention: President
or to such other address as either party shall designate by written notice,
similarly given, to the other party. Any notice if given or made by certified or
registered first class mail letter, return receipt requested, shall be deemed to
have been received on the earlier of the date actually received and the date
three (3) days after the same was posted (and in proving such it shall be
sufficient to prove that the envelope containing the same was properly addressed
and posted as aforesaid) and if given or made by telecopy transmission shall be
deemed to have been received at the time of dispatch, unless such date of deemed
receipt is not a business day, in which case the date of deemed receipt shall be
the next succeeding business day.
12.8 Successors and Assigns. This Agreement shall not be assignable by
either party without the prior written consent of the other party, except that
such consent is not required in connection with the assignment of either party's
rights or obligations hereunder to an Affiliate thereof or to any successor to
substantially all of this Agreement. Subject to the foregoing, this Agreement,
and each and every provision hereof, shall be binding upon and shall inure to
the benefit of the parties, their respective successors, successors-in-title,
heirs and assigns, and each and every successor-in-interest to any party,
whether such successor acquires such interest by way of gift, purchase,
foreclosure, or by any other method, shall hold such interest subject to all the
terms and provisions of this Agreement.
12.9 Counterparts. This Agreement shall become binding when any one or
more counterparts hereof, individually or taken together, shall bear the
signatures of each of the parties hereto. This Agreement may be executed in any
number of counterparts, each of which shall be an original as against either
party whose signature appears thereon, but all of which together shall
constitute but one and the same instrument.
12.10 License of Additional Copolymer(s) to Vaxcel. CytRx grants Vaxcel
the right to evaluate and request a license in the Field for a copolymer(s)
different than those described on Exhibit B. If such a license request is duly
approved by both parties, such copolymer(s) shall be deemed to be included
within the definition of Copolymer in Section 1.1 of this Agreement and the
parties will amend Exhibit B to reflect the additional licensed copolymer(s).
- 19 -
20
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed as of the date first above written.
CYTRX CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President and Chief Executive
Officer
VAXCEL, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President and Chief
Executive officer
- 20 -
21
EXHIBIT B
DESCRIPTION OF
COPOLYMERS LICENSED
TO VAXCEL BY CYTRX
DESCRIPTION - Synthetically produced block copolymers composed of a central
hydrophobic core of polyoxypropylene of 12,000 kd molecular weight, flanked by
hydrophilic chains of polyoxyethylene (including those synthesized by SCF
processes) as designated in the following chart.
-----------------------------------------------------------------------------
Copolymer Peak Molecular
Designation % ▇▇▇ Weight
-----------------------------------------------------------------------------
CRL-8196 2.5% 12,470
-----------------------------------------------------------------------------
CRL-1005 5.0% 12,670
-----------------------------------------------------------------------------
CRL-1309 7.5% 12,880
-----------------------------------------------------------------------------
CRL-2690 10% 13,090
-----------------------------------------------------------------------------
CRL-4279 15% 13,530
-----------------------------------------------------------------------------
CRL-4654 20% 14,240
-----------------------------------------------------------------------------
- 21 -
