RESEARCH AND LICENSE AGREEMENT
This Agreement, effective as of April 1, 1997 (the "Effective Date"), is by and
between NEW YORK UNIVERSITY (hereinafter "NYU"), a corporation organized and
existing under the laws of the State of New York and having a place of business
at 00 Xxxxxxxxxx Xxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 and AXONYX INC.
(hereinafter "CORPORATION"), a corporation organized and existing under the laws
of the State of Delaware having its principal office at: 000 Xxxxxx Xxxxxx
Xxxxxxxxx XX 00000.
RECITALS
WHEREAS, Drs. Xxxxxxx Xxxx-Xxxx and Xxxx Xxxxxxxxx of NYU (hereinafter
the "NYU Scientists") have made certain inventions relating to the diagnosis and
treatment of Alzheimer's Disease and other amyloidosis disorders, all as more
particularly described in pending U.S. patent application and counterpart
foreign patent application owned by NYU, identified in annexed Appendix I and
forming an integral part hereof (hereinafter the "Pre-Existing Inventions");
WHEREAS, NYU is willing to perform the NYU Research Project (as
hereinafter defined);
WHEREAS, CORPORATION is prepared to sponsor the NYU Research Project;
WHEREAS, subject to the terms and conditions hereinafter set forth, NYU
is willing to grant to CORPORATION and CORPORATION is willing to accept from NYU
the License (as hereinafter defined);
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 any consecutive period of twelve
months commencing on the first day of January of any year.
(b) "Corporation Entity" shall mean any company or other legal entity
which controls, or is controlled by, or is under common control
with, CORPORATION; control, means the holding of fifty and one
tenth percent (50. 1 %) or more of (i) the capital and/or (ii)
the voting rights and/or (iii) the right to elect or appoint
directors.
(c) "Date of First Commercial Sale" shall mean the date when a
"Licensed Product" is first sold in any country.
(d) "Field" shall mean anti-amyloid peptide inhibitors of
amyloidogenesis in connection with the diagnosis, treatment and
prevention of animal or human diseases or conditions.
(e) "License" shall mean the exclusive worldwide license to practice
the Research Technology (as hereinafter defined) to develop, to
make and have made, to use and have used, and to sell and have
sold, the Licensed Products.
(f) "Licensed Products" shall mean products for the diagnosis,
treatment or prevention of animal or human diseases or conditions
(i) covered by a claim of any unexpired NYU Patent which has not
been disclaimed or held invalid by a court of competent
jurisdiction from which no appeal can be taken, or (ii) utilizing
or based upon NYU Know-How.
(g) "Net Sales" shall mean the total amount received by Corporation,
any Corporation Entity, or any sub-licensee of CORPORATION in
connection with sales of Licensed Products, in any arm's length
transaction, by CORPORATION, any Corporation Entity or any
sublicensee of CORPORATION, after deduction of all the following
to the extent applicable to such sales:
(i) all trade, case and quantity credits, discounts, refunds
or rebates-,
(ii) allowances or credits for returns or recalls;
(iii) sales commissions ;
(iv) all taxes (except income taxes), tariffs, duties and
other similar governmental charges paid by the
CORPORATION or its affiliates or sublicensees; and
(v) export packaging, outbound freight or transportation
charges;
provided that Net Sales shall not include amounts
invoiced by CORPORATION to any person or entity that is a
Corporation Entity or a sublicensee of CORPORATION under
the License.
(h) "NYU Know-How" shall mean the Pre-Existing Inventions and any
unpublished information and materials including, but not limited
to, pharmaceutical, chemical, biological and biochemical
products, technical and non-technical data, materials, methods
and processes and any drawings, plans, diagrams, specifications
and/or other documents containing such information, discovered,
developed or acquired by, or on behalf of students or employees
of NYU during the term and in the course of the NYU Research
Project.
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(i) "NYU Patents" shall mean all United States and foreign patents
and patent applications, and any divisions, continuations, in
whole or in part, reissues, renewals and extensions thereof, and
pending applications therefor:
(i) which claim Pre-Existing Inventions and which are
identified on annexed Appendix 1; or
(ii) which claim inventions that are made, in whole or in
part, by students or employees of NYU during the term and
in the course of the NYU Research Project.
(j) "Research Period" shall mean the four-year period commencing on
the Effective Date hereof and any extension thereof as to which
NYU and CORPORATION shall mutually agree in writing.
(k) "NYU Research Project" shall mean the investigations at NYU
during the Research Period into the Field under the supervision
of the NYU Scientists in accordance with the research program,
described in annexed Appendix II, which forms an integral part
hereof.
(l) "Research Technology" shall mean all NYU Patents and NYU
Know-How.
(m) "Total Net Sales" shall mean the aggregate Net Sales of
CORPORATION, any Corporation Entity and any sublicensee of
CORPORATION.
2. EFFECTIVE DATE:
(a) This Agreement shall become effective with the signing of this
Agreement on April 1, 1997. Upon the Effective Date of this
Agreement CORPORATION will make its first quarterly installment
payment to NYU under Section 4 hereof.
(b) Upon this Agreement becoming effective, this Agreement shall
remain in force and effect until it expires or is terminated in
accordance with Section 16 or 18 hereof.
3. PERFORMANCE OF THE NYU RESEARCH PROJECT.
(a) In consideration of the sums to be paid to NYU as set forth in
Section 4 below, NYU undertakes to perform the NYU Research
Project under the supervision of the NYU Scientists during the
Research Period. If, during the Research Period all of the NYU
Scientists shall cease to supervise the NYU Research Project,
then NYU shall promptly so notify CORPORATION and shall endeavor
to' find among the scientists of NYU a scientist acceptable to
CORPORATION to continue the supervision of the NYU Research
Project in place of the NYU Scientists. If NYU is unable to find
such a scientist acceptable. to CORPORATION within three
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months after such notice to CORPORATION, CORPORATION shall have
the option to terminate its funding of the NYU Research Project.
CORPORATION shall promptly advise NYU in writing if CORPORATION
so elects. Such termination of funding pursuant to this Section
3(a) shall not terminate this Agreement or the License granted
herein. Nothing herein contained shall be deemed to impose an
obligation on NYU to find a replacement for the NYU Scientists.
(b) Nothing contained in this Agreement shall be construed as a
warranty on the part of NYU that any results or inventions will
be achieved by the NYU Research Project, or that the Research
Technology and/or any other results or inventions achieved by the
NYU Research Project, if any, are or will be commercially
exploitable and furthermore, NYU makes no warranties whatsoever
as to the commercial or scientific value of the Research
Technology and/or as to any results which may be achieved in the
NYU Research Project.
(c) NYU shall have full authority and responsibility for the
completion of the NYU Research Project within the parameters set
forth therein, subject to its obligations under Section 3(d)
hereof. All students and employees of NYU who work on the NYU
Research Project will do so as employees or students of NYU, and
not as employees of CORPORATION. Any student working on the NYU
Research Project shall enter into a written confidentiality
agreement with respect to CORPORATION Confidential Information
(as that term is hereinafter defined), a copy of which will be
provided to CORPORATION.
(d) A Scientific Advisory Board (hereinafter the "SAB") shall be
constituted by CORPORATION, and members of such Board appointed
by CORPORATION following consultation with NYU as to the
identities and qualifications of such members. The NYU Scientists
shall consult from time to time with the SAB to review the plan,
progress and direction of the NYU Research Project to evaluate
the tasks, goals, and timing of the NYU Research Project. The
NYU Research Project shall be amended only with the written
consent of NYU the NYU Scientists and CORPORATION.
(e) On or about June 1 and December 1 of each year of the Research
Period, NYU shall prepare a written report summarizing the
results of the work conducted on the NYU Research Project during
the preceding six (6) months and deliver such report to the SAB.
The CORPORATION may request, upon thirty days notice that NYU
prepare a written interim report for the SAB.
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4. FUNDING OF THE NYU RESEARCH PROJECT.
(a) As compensation to NYU for work to be performed on the NYU
Research Project during the Research Period, subject to any
earlier termination of the NYU Research Project pursuant to
Section 3(a) hereof, CORPORATION will pay NYU the total sum of
$1,200,000, payable in sixteen consecutive quarterly payments of
$ 75,000, beginning on the date of the signing of this Agreement
with subsequent payments on each three (3) month anniversary of
the Effective Date.
(b) Nothing in this Agreement shall be interpreted to prohibit NYU
(or the NYU Scientists) from obtaining additional financing or
research grants for the NYU Research Project from government
agencies, which grants or financing may render all or part of the
NYU Research Project and the results thereof subject to the
rights of the U.S. Government and its agencies, as set forth in
Title 35 U.S.C. Section 200 ET SEC. NYU shall provide
CORPORATION with reasonably timely notice of any such grant or
other financing. Such notice will include a copy of the complete
scientific research proposal for any such grant or additional
financing.
5. TITLE.
(a) Subject to the License granted to CORPORATION hereunder, it is
hereby agreed that all right, title and interest, in and to the
Research Technology, and in and to any drawings, plans, diagrams,
specifications, and other documents containing any of the
Research Technology shall vest solely in NYU. At the request of
NYU, CORPORATION shall take all steps as may be necessary to give
full effect to said right, title and interest of NYU including,
but not limited to, the execution of any documents that may be
required to record such right, title and interest with the
appropriate agency or government office.
(b) Subject to the License granted to CORPORATION hereunder, for so
long as the NYU Scientists are employed by NYU, any and all
inventions made by such NYU Scientists and relating to the Field
shall' be owned solely by NYU.
6. PATENTS AND PATENT APPLICATIONS.
(a) CORPORATION shall, simultaneously -with the signing of this
Agreement pay NYU the sum of U.S. $ 2,4,994.72, being the amount
of all costs and fees incurred by NYU up to the date hereof in
connection with the patent applications identified in Appendix I
hereto.
(b) NYU will promptly disclose to CORPORATION in writing any
inventions which constitute potential NYU Patents. CORPORATION
will promptly disclose to NYU any inventions which are in the
Field and which are conceived by employees
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or consultants of CORPORATION. All such inventions shall be
considered "CORPORATION Confidential Information" subject to
Section 11 of this Agreement.
(c) At the initiative of CORPORATION or NYU, the parties shall
consult with each other regarding the prosecution of all patent
applications with respect to the Research Technology. Such
patent applications shall be filed, prosecuted and maintained by
patent counsel selected by NYU, and acceptable to CORPORATION,
which acceptance shall be timely communicated and not be
unreasonably denied. Copies of all such patent applications and
patent office actions shall be forwarded to each of NYU and
CORPORATION. NYU and CORPORATION shall each also have the right
to have such patent applications and patent office actions
independently reviewed by other patent counsel separately
retained by NYU or CORPORATION, at their own respective expense,
upon prior notice to and consent of the other party, which
consent shall not unreasonably be withheld.
(d) All applications and proceedings with respect to the NYU Patents
shall be filed, prosecuted and maintained by NYU at the expense
of CORPORATION. Against the submission of invoices, CORPORATION
shall reimburse NYU for all reasonable costs and fees incurred by
NYU during the term of this Agreement in connection with the
filing, maintenance, prosecution, protection and the like of the
NYU Patents, subject to the prior written submission of cost
estimates and a budget for any legal work expected to cost more
than $2500.
(e) NYU and CORPORATION 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 Research
Technology.
(f) As long as CORPORATION diligently maintains and prosecutes any
patents or patent applications within the NYU Patents in each of
the following Major Countries: the United States, Japan, France,
Germany, the United Kingdom, Spain, Italy, Switzerland, Canada,
and Australia; CORPORATION shall retain a world wide exclusive
License as that term is defined above. If at any time during the
term of this Agreement CORPORATION decides that it is
undesirable, as to one or more of the Major Countries, to
prosecute or maintain any patents or patent applications within
the NYU Patents, it shall give prompt written notice thereof to
NYU, and upon receipt of such notice CORPORATION shall be
released from its obligations to bear all of the expenses to be
incurred thereafter as to such Major Countries in conjunction
with such patent(s) or patent application(s) and such patent(s)
or application(s) shall be deleted from the Research Technology
and NYU shall be free to grant rights in and to the Research
Technology in such Major
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Countries to third parties, and CORPORATION shall have no right
to exploit the Research Technology in such Major Countries
(g) Nothing herein contained shall be deemed to be a warranty by NYU
that
(i) NYU can or will be able to obtain any patent or patents
on any patent application or applications in the NYU
Patents or any portion thereof, or that any of the NYU
Patents will afford adequate or commercially worthwhile
protection, or
(ii) that the manufacture, use, or sale of any element of the
Research Technology or any Licensed Product will not
infringe any patent(s) of a third party.
7. GRANT OF LICENSE.
(a) Subject to the terms and conditions hereinafter set forth and
subject to the rights of the U.S. government and its agencies as
set forth in 35 U.S.C. 200 ET SEC, NYU hereby grants to
CORPORATION and CORPORATION hereby accepts from NYU the License.
(b) The License granted to CORPORATION in Section 7(a) hereto 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 eight (8) years from the Date of
First Commercial Sale in such country or until the expiration
date of the last to expire of the NYU Patents whichever shall be
later. At the expiration of the term of this Agreement, the
CORPORATION shall be deemed to have a fully paid License, in
respect of all rights being licensed hereunder, and no further
royalties shall accrue or be payable by CORPORATION to NYU in
respect thereof.
(c) CORPORATION shall be entitled to grant sublicenses under the
License on terms and conditions in compliance and not
inconsistent with the terms and conditions of this Agreement
(except that the rate of royalty may be different from those set
forth in this Agreement) (i) to a Corporation Entity or (ii) to
other third parties, in each case for consideration and in an
arms-length transaction. Sublicenses shall only be granted by
CORPORATION under a written agreement, a copy of which shall be
provided by CORPORATION to NYU as soon as practicable after the
signing thereof. Each sublicense granted by CORPORATION
hereunder shall be subject and subordinate to the terms and
conditions of this License Agreement and shall contain
(inter-alia) the following provisions:
(1) the sublicense shall expire automatically on the
termination of the License;
(2) the sublicense shall not be assignable, in whole or in
part;
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(3) the sublicensee shall not grant further sublicenses;
(4) both during the term of the sublicense and thereafter the
sublicensee shall agree to a confidentiality obligation
similar to that imposed on CORPORATION in Section 11
below, and that the sublicensee shall impose on its
employees, both during the terms of their employment and
thereafter, a similar undertaking of confidentiality; and
(5) the sublicense agreement shall include the text of
Sections 14 and 15 of this Agreement and shall state that
NYU is an intended third party beneficiary of such
sublicense agreement for :the purpose of enforcing such
indemnification and insurance provisions.
8. PAYMENTS FOR LICENSE.
(a) In consideration for the grant and during the term of the
License, CORPORATION shall pay to NYU:
(1) upon the achievement of the following technical
milestones with respect to:
(a) one neuroimaging product, (b) one Alzheimer's
treatment product and (c) one prion treatment product, in
each case which is a Licensed Product, the payments as
indicated below:
Milestone Payments
--------- --------
On (x) Thirty days (30) following the first filing of an $25,000
Investigational New Drug Application ("IND") or
(y) if the Federal Drug Administration requires
modification of such IND within such
thirty-day period, upon approval of such IND after
such modification
Upon the approval of a New Drug $150,000;
Application in the United States
(2) With respect to sales of Licensed Products that
constitute therapeutic or preventative products for use
in humans, a royalty of (a) 4% of Total Net Sales during
each calendar year up to and including $50,000,000, (b)
3% of Total Net Sales during each calendar year in excess
of $50,000,000 and up to and including $100,000,000 and
(c) 2% of Total Net Sales during each calendar year in
excess of $ 1 00,000,000; and
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(3) With respect to sales of Licensed Products that
constitute diagnostic products for use in humans, or
diagnostic, therapeutic or preventative products for use
in animals, a royalty of (a) 3% of Total Net Sales during
each calendar year-up to and including $30,000,000 and
(b) 2% of Total Net Sales during each calendar year in
excess of $30,000,000.
(4) CORPORATION shall pay to NYU the royalty payments set
forth in Sections 8 (a)(2) and 8 (a)(3) hereof for a
period of eight (8) years from the Date of first
Commercial Sale in such country or until the expiration
date of the last to expire of the NYU Patents, whichever
shall be later; PROVIDED, however, that during any period
of time after the expiration date of the last to expire
of the NYU Patents, covering the product in question, but
within eight (8) years from the Date of First Commercial
Sale in a given country, NYU shall receive one half (1/2)
of the royalty payment as set forth on the schedule in
Sections 8 (a)(2) and 8(a)(3) hereof, on a country by
country and product by product basis. CORPORATION shall
inform NYU in writing of the Date of First Commercial
Sale with respect to each Licensed Product in each
country as soon as practicable after the making of each
such first commercial sale.
(b) For the purpose of computing the royalties due to NYU hereunder,
the year shall be divided into two parts ending on June 30 and
December 31. Not later than sixty (60) days after each December
and June in each Calendar Year during the term of the License,
CORPORATION shall submit to NYU a full and detailed report of
royalties or payments due NYU under the terms of this Agreement
for the preceding half year (hereinafter "the Half-Year Report"),
setting forth the Total Net Sales and Net Sales of each of
CORPORATION, each Corporation Entity and each sublicensee of
CORPORATION and/or lump sum payments and all other payments or
consideration from sublicensees upon which such royalties are
computed and including at least
(i) the quantity of Licensed Products used, sold, transferred
or otherwise disposed of on a country-by-country basis;
(ii) the selling price of each Licensed Product;
(iii) the deductions permitted under Section l(g) hereof to
arrive at Net Sales; and the royalty computations and
subject of payment.
If no royalties or other payments, are due, a statement shall be
sent to NYU stating such fact. Payment of the full amount of any
royalties or other payments due to NYU for the preceding half
year shall accompany each Half-Year Report on
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royalties and payments. CORPORATION shall keep for a period of
at least four (4) years after the date of entry, full, accurate
and compete books and records consistent with sound business and
accounting practices and in such form and in such detail as to
enable the determination of the amounts due to NYU from
CORPORATION pursuant to the terms of this Agreement.
(c) Within sixty (60) days after the end of each Calendar Year
commencing on the Date of First Commercial Sale, CORPORATION
shall furnish NYU with a report (hereinafter the "Annual
Report"), certified by CORPORATION's chief financial officer,
relating to the royalties and other payments due to NYU pursuant
to this Agreement in respect of the Calendar Year covered by such
Annual Report and containing the same details as those specified
in Section 8(b) above in respect of the Half-Year Report.
(d) On reasonable notice and during regular business hours, NYU or an
authorized representative of NYU shall each have the right to
inspect the books of accounts, records and other relevant
documentation of CORPORATION, or any Corporation Entity insofar
as they relate to the production, marketing and sale of Licensed
Products, in order to ascertain or verify the amount of royalties
and other payments due to NYU hereunder, and the accuracy of the
information provided to NYU in the aforementioned reports.
CORPORATION shall cause any sub-licensee of CORPORATION to permit
an inspection by CORPORATION, directly or through agents of
CORPORATION, of such sub-licensee's books of accounts, records
and other documentation to the extent that such documentation
relates to the production, marketing and sale of Licensed
Products, and shall, upon request of NYU, appoint NYU as an agent
of CORPORATION for purposes of conducting such an inspection.
(e) Beginning on the sixth Calendar Year and continuing thereafter
until this Agreement shall terminate or expire, CORPORATION
agrees that if the total royalties paid to NYU under Section
8(a)(2) and (3) do not amount to one hundred and fifty thousand
dollars ($150,000) in each Calendar Year, CORPORATION will pay to
NYU within sixty (60) days after the end of each such Calendar
Year, as additional royalty, the difference between the amount of
the total royalties paid to NYU by CORPORATION in such Calendar
Year and one hundred and fifty thousand dollars ($150,000),
failing which NYU shall have the right solely at its election,
upon written notice to CORPORATION, to either terminate this
Agreement for cause or to declare the License granted herein to
CORPORATION to be non-exclusive.
(f) CORPORATION shall, and shall cause each Corporation Entity and
sublicensee of CORPORATION, to effect sales of Licensed, Products
to third parties on commercially reasonable, arm's length terms.
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9. METHOD OF PAYMENT.
(a) Royalties and other payments due to NYU hereunder, shall be paid
to NYU in United States dollars. Any such royalties on or other
payments relating to transactions in a foreign currency shall be
converted into United States dollars based on the closing buying
rate published in the Wall Street Journal applicable to
transactions under exchange regulations for the particular
currency on the last business day of the accounting period for
which such royalty or other payment is due. If the transfer of
or the conversion into United States dollar equivalent of any
such royalties or payments due is not lawful or possible in any
country, such royalties or payments shall be made by the deposit
thereof in the currency of the country in question to the credit
and account of NYU or its nominee in a bank or trust company
located in that country, prompt notice of which shall given to
NYU, NYU shall be advised in writing in advance by CORPORATION
and provide CORPORATION a nominee if so desired.
(b) CORPORATION shall be responsible for payment to NYU of all
royalties due on sale, transfer or disposition of Licensed
Products by CORPORATION, any Corporation Entity and by the
sublicensees of CORPORATION.
10. DEVELOPMENT AND COMMERCIALIZATION.
(a) CORPORATION undertakes to use reasonable diligence to carry out
the Development Plan (annexed hereto as Appendix - and which is
an integral part of this Agreement), including but not limited
to, the performance of all efficacy, pharmaceutical, safety,
toxicological and clinical tests, trials and studies and all
other activities necessary in order to obtain the approval of the
FDA for the production, use and sale of the Licensed Products,
all as set forth in the Development Plan and within all
timetables set forth therein. CORPORATION further undertakes to
exercise due diligence and to employ its reasonable diligence to
obtain or to cause its sublicensees 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 CORPORATION or its sublicensees 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 FDA Good Laboratory Practices and in a manner
acceptable to the relevant health authorities, CORPORATION shall
carry out such tests, trials, studies and other activities in
accordance with FDA Good Laboratory Practices and in a manner
acceptable to the relevant health authorities. Furthermore, the
Licensed Products shall be produced in accordance with FDA
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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) CORPORATION undertakes to begin the regular commercial
production, use, and sale of the Licensed Products in good faith
in accordance with the Development Plan and to continue
diligently thereafter to commercialize the Licensed Products.
(d) CORPORATION shall provide NYU with written reports on all
activities and actions undertaken by CORPORATION to develop and
commercialize the Licensed Products; such reports shall be made
within sixty (60) days after each six (6) months of the duration
of this Agreement, commencing six months after the Effective
Date.
(e) If CORPORATION shall not commercialize the Licensed Products
within a reasonable time frame, unless such delay is necessitated
by FDA or other regulatory agencies or unless NYU and CORPORATION
have mutually agreed to amend the Development Plan because of
unforeseen circumstances, NYU shall notify CORPORATION in writing
of CORPORATION's failure to commercialize and shall allow
CORPORATION ninety (90) days to cure its failure to
commercialize. CORPORATION's failure to cure such delay to NYU's
reasonable satisfaction within such ninety (90)-day period shall
be a material breach of this Agreement.
11. CONFIDENTIAL INFORMATION.
(a) Except as otherwise provided in Section 11 (c) and Section 12
below, NYU shall maintain any and all of the Research Technology
and any and all CORPORATION Confidential Inventions disclosed
under 6(b) hereof in confidence and shall not release or disclose
any tangible or intangible component thereof to any third party
without first receiving the prior written consent of CORPORATION
to said release or disclosure; provided, however that the
requirements of this section with respect to Research Technology
shall not apply to (i) government authorities and (ii) provision
of tangible components to academic or non-profit institutions for
research purposes, which shall be provided under a material
transfer agreement on conditions consistent with academic
standards. NYU shall provide timely notice to CORPORATION of any
disclosure made under this provision.
(b) Except as otherwise provided in Section 11 (c) and 11 (d) below,
CORPORATION shall maintain any and all of the Research Technology
in confidence and shall not release or disclose any tangible or
intangible component thereof to any third party without first
receiving the prior written consent of NYU to said release or
disclosure which consent shall not be withheld unreasonably.
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(c) The obligations of confidentiality on each party set forth in
Sections 11 (a) and (b) shall not apply to any component of the
Research Technology or Corporation Inventions which: (i) was part
of the public domain prior to the Effective Date of this
Agreement, (ii) which becomes a part of the public domain not due
to some unauthorized act by or omission of the receiving party
after the effective date of this Agreement, (iii) which was
disclosed to the receiving party by a third party who has the
right to make such disclosure, (iv) was known to the receiving
party prior to disclosure by the disclosing party, or (v) was
independently developed by the receiving party without use of
confidential information of the disclosing party.
(d) The provisions of Section 11 (b) notwithstanding, CORPORATION may
disclose the Research Technology to: (i) third parties who need
to know the same in order to secure regulatory approval for the
sale of Licensed Products, (ii) in any private placement
memoranda, prospectus, business plan or other aspect of a
presentation to interested investors, or (iii), to prospective or
actual sublicensees of CORPORATION, provided that such third
parties undertake a written obligation of confidentiality with
respect to the Research Technology at least as restrictive as
CORPORATION's obligations under this Section 11, a copy of which
shall be provided to NYU.
12. PUBLICATION.
(a) Prior to submission for publication of a manuscript describing
the results of any aspect of the NYU Research Project, NYU shall
send CORPORATION a copy of the manuscript to be submitted, and
shall allow CORPORATION sixty (60) days from the date of such
mailing to determine whether- the manuscript contains such
subject matter for which patent protection should be sought prior
to publication of such manuscript, for the purpose of protecting
an invention made by the NYU Scientists during the course and
within the term of the NYU Research Project. Should CORPORATION
believe the subject matter of the manuscript contains a
patentable invention, then, prior to the expiration of such sixty
(60)-day period from the mailing date of such manuscript to
CORPORATION by NYU, CORPORATION shall give written notification
to NYU of:
(i) its determination that such manuscript contains
patentable subject matter for which patent protection
should be sought; and
(ii) the countries in which such patent protection should be
sought.
(b) After the expiration of such sixty (60)-day period from the date
of mailing such manuscript to CORPORATION, unless NYU has
received the written notice specified above from CORPORATION, NYU
shall be free to submit such manuscript for publication to
publish the disclosed research results in any manner consistent
with academic standards.
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(c) Upon receipt of such written notice from CORPORATION, NYU will
thereafter delay submission of the manuscript for an additional
period of up to sixty (60) days to permit the preparation and
filing in accordance with Section 6 hereof of a U.S. patent
application by NYU on the subject matter to be disclosed in such
manuscript. After expiration of such 60-day period, or the
filing of a patent application on each such invention, whichever
shall occur first, NYU shall be free to submit the manuscript and
to publish the disclosed results.
13. INFRINGEMENT OF NYU PATENT.
(a) In the event a party to this Agreement acquires information that
a third party is infringing one or more of the NYU Patents, 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 an NYU Patent, CORPORATION
shall be privileged but not required to bring suit against the
infringer. Should CORPORATION elect to bring suit against an
infringer and NYU is joined as a party plaintiff in any such
suit, NYU shall have the right to approve the counsel selected by
CORPORATION to represent NYU. The expenses of such suit or suits
that CORPORATION elects to bring, including any expenses of NYU
incurred in conjunction with the prosecution of such suit or the
settlement thereof, shall be paid for entirely by CORPORATION and
CORPORATION shall hold NYU free, clear and harmless from and
against any and all costs of such litigation, including
attorneys' fees. CORPORATION shall not compromise or settle such
litigation without the prior written consent of NYU which shall
not be unreasonably withheld.
(c) In the event that CORPORATION exercises the right to xxx provided
herein and obtains any amounts as a recovery in any such suit,
such amounts shall be divided into two categories of damages:
amounts attributable to lost revenues and amounts attributable to
all other claims. If the court or terms of any settlement
entered into by CORPORATION in accordance with the terms hereof
provides for an allocation, such allocation shall be used for
purposes of this Section 13 (c). CORPORATION shall (A) reimburse
itself for all costs and expenses of every kind and character,
including reasonable attorney's fees, necessarily involved in the
prosecution of such suit from amounts allocable to lost revenues,
(b) promptly pay to NYU an amount equal to the percentage called
for under the royalty provisions of this agreement of all amounts
allocated to claims for lost revenues, after reimbursement of
CORPORATION for expenses as provided in clause (a).
(d) If CORPORATION does not bring suit against said infringer
pursuant to Section 13(b) herein, or has not commenced
negotiations with said infringer for discontinuance of said
infringement, within ninety (90) days after receipt of such
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notice, NYU shall have the right, but shall not be obligated, to
bring suit for such infringement. Should NYU elect to bring suit
against an infringer and CORPORATION is joined as a party
plaintiff in any such suit, CORPORATION shall have the right to
approve the counsel selected by NYU to, represent CORPORATION and
NYU shall hold CORPORATION free, clear and harmless from and
against any and all costs and expenses of such litigation,
including attorneys' fees. If CORPORATION has commenced
negotiations with an alleged infringer of the NYU Patent for
discontinuance of such infringement within such 90-day period,
CORPORATION shall have an additional ninety (90) days from the
termination of such initial 90-day period to conclude its
negotiations before NYU may bring suit for such infringement. In
the event NYU brings suit for infringement of any NYU Patent, NYU
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, NYU shall promptly pay to CORPORATION an
amount equal to fifty percent (50%) of such remainder and NYU
shall be entitled to receive and retain the balance of the
remainder of such recovery.
(e) CORPORATION agrees to cooperate fully with NYU at the request of
NYU, including, by giving testimony and producing documents
lawfully requested in the prosecution of any suit by NYU for
infringement of the NYU patents; provided, NYU shall pay all
reasonable expenses (including attorneys' fees) incurred by
CORPORATION in connection with such cooperation. NYU shall
cooperate and shall endeavor to cause the NYU Scientists to
cooperate with CORPORATION at the request of CORPORATION,
including by giving testimony and producing documents lawfully
requested, in the prosecution of any suit by CORPORATION for
infringement of the NYU Patents; PROVIDED that CORPORATION shall
pay all reasonable expenses (including attorneys' fees) incurred
by NYU in connection with such cooperation.
14. LIABILITY AND INDEMNIFICATION.
(a) CORPORATION shall indemnify, defend and hold harmless NYU and its
trustees, officers, medical and professional staff, employees,
students and agents and their respective successors, heirs and
assigns (the "Indemnitees"), against any liability, damage, loss
or expense (including reasonable attorneys' fees and expenses of
litigation) incurred by or imposed upon the Indemnitees or any
one of them in connection with: any claims, suits, actions,
demands or judgments (i) arising out of the design, production,
manufacture, sale, use in commerce or in human clinical trials,
lease, or promotion by CORPORATION, Corporation Entity or any
agent or sublicensee of CORPORATION of any Licensed Product,
process or service relating to, or developed pursuant to, this
Agreement, or (ii) arising out of any
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other activities to be carried out pursuant to this Agreement;
except for claims arising out of the sole gross negligence of the
Indemnitee.
(b) With respect to an Indemnitee, CORPORATION's indemnification
under subsection (a)(i) of this Section 14 shall apply to any
liability, damage, loss or expense whether or not it is
attributable to the negligent activities of such Indemnitee.
CORPORATION's indemnification obligation under subsection (a)(ii)
of this Section 14 shall not apply to any liability, damage, loss
or expense to the extent that it is attributable to the negligent
activities of such Indemnitee.
(c) CORPORATION agrees, at its own expense, to provide attorneys
reasonably acceptable to NYU to defend against any actions
brought or filed against any Indemnitee with respect to the
subject of indemnity to which such Indemnitee is entitled
hereunder, whether or not such actions are rightfully brought.
(d) Whenever an event or situation arises which, it is reasonable to
believe, may lead to an indemnification obligation by
CORPORATION, the Indemnitee shall give prompt written notice to
CORPORATION of such event or situation and, if a claim is made or
a suit is brought, the Indemnified Party shall promptly forward a
copy of every demand, notice, summons, complaint or other process
received by it to CORPORATION. CORPORATION shall assume the
defense of such claim and all costs thereof. CORPORATION shall
have the right to negotiate and consent to settlement; PROVIDED
that the consent of NYU shall be obtained prior to any settlement
of a claim or litigation that involves affirmative action on the
part of NYU or any Indemnitee or the payment of money for which
CORPORATION has not made satisfactory arrangements for
reimbursement of NYU or such Indemnified Party. The
Indemnified Party shall cooperate reasonably with CORPORATION in
all respects in all phases of a claim and any proceeding arising
therefrom, including but not limited to, assisting in the conduct
of lawsuits, assisting in enforcing an agreement of contribution
or indemnity against a third party, providing witnesses, and
making records and information available to CORPORATION. The
Indemnified Party shall have the right to employ separate counsel
in any such action and to participate in the defense thereof, but
the fees and expenses of such counsel shall be at the expense of
such Indemnified Party unless the employment of such counsel has
been specifically authorized in writing by CORPORATION.
CORPORATION shall not be responsible for any settlement of any
such claim effected without its consent.
15. SECURITY FOR INDEMNIFICATION.
(a) At such time as any Licensed Product, process or service relating
to, or developed pursuant to, this Agreement is being
-commercially distributed or sold (other than for the purpose of
obtaining regulatory approvals) by CORPORATION, any Corporation
Entity or any agent or sublicensee of
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CORPORATION, CORPORATION shall at its sole cost and expense,
procure and maintain policies of comprehensive general liability
insurance in amounts not less than $2,000,000 per incident and
$5,000,000 annual aggregate and naming the Indemnitees as
additional insureds. Such comprehensive general liability
insurance shall provide (i) product liability coverage and (ii)
broad form contractual liability coverage for CORPORATION's
indemnification obligations under Section 14 of this Agreement.
If CORPORATION elects to self-insure all or part of the limits
described above (including deductibles or retentions which are in
excess of $250,000 annual aggregate), such self-insurance program
must be acceptable to NYU. The minimum amounts of insurance
coverage required under this Section 15 shall not be construed to
create a limit of CORPORATION's liability with respect to its
indemnification obligations under Section 14 of this Agreement.
(b) CORPORATION shall provide NYU with written evidence of such
insurance upon request of NYU. CORPORATION shall provide NYU
with written notice at least sixty (60) days prior to the
cancellation, non-renewal or material change in such insurance;
if CORPORATION does not obtain replacement insurance providing
comparable coverage within such sixty (60) day period, NYU shall
have the right to terminate this Agreement effective at the end
of such sixty (60) day period without notice or any additional
waiting periods.
(c) CORPORATION shall maintain such comprehensive general liability
insurance beyond the expiration or termination of this Agreement
during (i) the period that any product, process or service,
relating to, or developed pursuant to, this Agreement is being
commercially distributed or sold (other than for the purpose of
obtaining regulatory approvals) by CORPORATION, any Corporation
Entity or any agent or sublicensee of CORPORATION and (ii) a
reasonable period after the period referred to in (c)(i) above
which in no event shall be less than fifteen (15) years.
16. EXPIRY AND TERMINATION.
(a) Unless earlier terminated pursuant to Section 16 or 18 hereof,
this Agreement shall expire upon the expiration of the period of
the License in all countries as set forth in Section 7(b) above.
(b) 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 by one party of this Agreement shall be
deemed to exist if the other 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 sixty (60) days or, in the case of failure to pay
17
any amounts due hereunder, thirty (30) days (unless otherwise
specified herein) after the giving of notice by the other party
specifying such breach or default, or automatically and without
further action if either NYU or CORPORATION discontinues its
business or becomes insolvent or bankrupt.
(c) 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, during-the period of arrears and such amount and the
interest thereon may be set off against any amount due, whether
under terms of this Agreement or otherwise, to the party in
default by any non-defaulting party.
(d) Upon termination of this Agreement for any reason, prior to
expiration as set forth in Section 16(a) hereof, all rights in
and to the Research Technology shall revert to NYU, and
CORPORATION shall not be entitled to make any further use
whatsoever of the Research Technology.
(e) Termination of this Agreement shall not relieve either party of
any obligation to the other party incurred prior to such
termination.
(f) Sections 5, 14, 15, 16, and 21 hereof shall survive and remain in
full force and effect after any termination, cancellation or
expiration of this Agreement. Section 11 shall survive
terminaton, cancellation or expiration of this Agreement and
shall remain in full force and effect, EXCEPT that, upon
termination, Section 11(a) shall not apply to NYU with respect to
Research Technology.
(g) At the end of the term of the NYU Research Project, after
CORPORATION's payment of all funds due under Section 4 hereof,
CORPORATION shall have the right to terminate this Agreement
without cause, on sixty (60) days' written notice, whereupon all
rights in and to the Research Technology shall revert to NYU, and
CORPORATION shall not be entitled to make any further use
whatsoever of the Research Technology.
17. REPRESENTATIONS AND WARRANTIES BY CORPORATION.
CORPORATION hereby represents and warrants to NYU as follows:
(a) CORPORATION is a corporation duly organized, validly existing and
in good standing under the laws of the State of Delaware.
CORPORATION 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
CORPORATION.
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(b) There is no pending or, to CORPORATION's knowledge, threatened
litigation involving CORPORATION which would have any effect on
this Agreement or on CORPORATION's ability to perform its
obligations hereunder; and
(c) There is no indenture, contract, or agreement to which
CORPORATION is a party or by which CORPORATION is bound which
prohibits or would prohibit the execution and delivery by
CORPORATION of this Agreement or the performance or observance by
CORPORATION of any term or condition of this Agreement.
18. CAPITALIZATION OF THE CORPORATION.
(a) To effectuate its funding obligations under Sections 4 and 8 of
this Agreement and its development and commercialization
obligations under Section 10 hereof, CORPORATION undertakes to
use its best efforts to sufficiently capitalize CORPORATION with
equity financing. CORPORATION undertakes to use its best efforts
to raise an aggregate amount of $5 million through one or more
private placements of equity securities prior to one (1) year
after the Effective Date of this Agreement, or such later date as
shall be mutually agreed upon by CORPORATION and NYU in writing,
provided, however, that neither party shall have any obligation
to agree to an extension beyond one (1) year after the Effective
Date of this Agreement. In the event CORPORATION is not
capitalized according to this agreement and CORPORATION has not
satisfied the requirements of Section 18 (b) below on or before
one (1) year after the Effective Date of this Agreement, and the
parties have not mutually agreed to an extension of such date,
this Agreement may be terminated by NYU on written notice to
CORPORATION.
(b) As an alternative to meeting the capitalization requirements of
Section 18(a) above CORPORATION may, at its option, upon written
notice to NYU, satisfy the requirements of this Section 18 by
entering into a strategic alliance including a sublicense
agreement under Section 7 (c) hereof with a major pharmaceutical
company, with a market valuation of $5 billion or more, that has
made a commitment to develop the Licensed Products in the United
States, Japan or Europe, and further provided that CORPORATION
shall have: (i) paid to NYU $500,000, and (ii) agrees to pay NYU
milestone payments upon filing of an IND and approval of an NDA
equal to four (4) times those contemplated in Section 8 (a)
above.
(c) The CORPORATION shall give NYU timely written notification of all
closings of private placements pursuant to Section 18(a), and any
strategic alliances contemplated in Section 18(b) above.
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19. REPRESENTATIONS AND WARRANTIES BY NYU.
NYU hereby represents and warrants to CORPORATION as follows:
(a) NYU is a corporation duly organized, validly existing and in good
standing under the laws of the State of New York. NYU 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 NYU.
(b) There is no pending or, to NYU's knowledge, threatened litigation
involving NYU which would have any effect on this Agreement or on
NYU's ability to perform its obligations hereunder; and
(c) There is no indenture, contract, or agreement to which NYU is a
party or by which NYU is bound which prohibits or would prohibit
the execution and delivery by NYU of this Agreement or the
performance or observance by NYU of any term or condition of this
Agreement.
20. NO ASSIGNMENT.
Neither CORPORATION nor NYU 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; PROVIDED that NYU
may assign its interest in this Agreement in whole or in part without
the consent of CORPORATION if such assignee (A) is a parent, subsidiary,
affiliate or related entity to NYU or (B) is an entity that acquires
substantially all of the ownership interests or assets of NYU or New
York University Medical Center (or any successor to the foregoing) or
(C) is an entity formed by NYU or New York University Medical Center (or
any successor to the foregoing) and other institutions, one of the
purposes, of which is to perform the activities for which NYU is
obligated pursuant to this Agreement.
21. USE OF NAME.
Without the prior written consent of the other party, neither
CORPORATION nor NYU shall use the name of the other party or any
adaptation thereof or of any staff member, employee or student of the
other party:
(i) in any product labeling, advertising, promotional or sales
literature;
(ii) in connection with any public or private offering or in
conjunction with any application for regulatory approval, unless
disclosure is otherwise required by law, in which case either
party may make factual statements concerning this Agreement
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or file copies of this Agreement after providing the other party
with an opportunity to comment and reasonable time within which
to do so on such statement in draft.
Except as provided herein, neither NYU nor CORPORATION will issue public
announcements about this Agreement or the status or existence of the NYU
Research Project without prior written approval of the other party.
22. MISCELLANEOUS.
(a) In carrying out this Agreement the parties shall comply with all
local, state and federal laws and regulations including but not
limited to, the provisions of Title 35 United States Code Section
200 ET al. and 15 CFR Section 368 ET SEQ.
(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
under the laws of the State of New York.
(d) Any dispute arising under this Agreement shall be resolved in an
action in the courts of New York State or the federal courts
located in New York State, and the parties hereby consent to
personal jurisdiction of such courts in any action.
(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 NYU: New York University Medical Center
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx X. Xxxxxxxx
Vice President for
Industrial Liaison
and,
Office of Legal Counsel
New York University
Xxxxx Library
00 Xxxxxxxxxx Xxxxxx Xxxxx
Xxx Xxxx, XX 00000
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Attention: Xxxxx X. Xxxxxx Associate General Counsel
To CORPORATION:
AXONYX Inc.
000 Xxxxxx Xxxxxx
X.X. Xxx 000
Xxxxxxxxx XX 00000
Attention: Xx. Xxxxxx Xxxxxxx,
Chairman
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 CORPORATION and NYU.
(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.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement effective as
of the date and year first above written.
NEW YORK UNIVERSITY
By: /s/ Xxxxx X. Xxxxxxxx
-----------------------------------
Xxxxx X. Xxxxxxxx
Title: Vice President for Industrial Liaison
Date: 4/8/97
-----------------------------------
AXONYX Inc.
By: /s/ Xxxxxx X. Xxxxxxx, M.D.
-----------------------------------
Xx. Xxxxxx Xxxxxxx
Title: President
Date: 4/3/97
-----------------------------------
Read and Accepted by:
/s/ Xxxx Xxxxxxxxx /s/ Xxxxxxx Xxxx
------------------------------ ------------------------------
Xx. Xxxx Xxxxxxxxx Dr. Xxxxxxx Xxxx-Xxxx
Date: 4/8/97 Date: 4/8/97
------------------------- -------------------------
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