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EXHIBIT 10.4
CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.
ASTERISKS DENOTE SUCH OMISSIONS.
LICENSE AGREEMENT
THIS AGREEMENT, effective this 5th day of April, 1994 ("Effective
Date"), is entered into by and between Clintec Nutrition Company, an
Illinois partnership organized under the laws of the State of Illinois,
having offices at Xxxxx Xxxxxxx Xxxxx, Xxxxx 000, Xxxxxxxxx, Xxxxxxxx
00000-0000 ("CLINTEC") and Free Radical Sciences, Inc., a Delaware
corporation, having offices at 000 Xxxxx Xxxxxx, 00xx Xxxxx, Xxxxxxxxx,
Xxxxxxxxxxxxx 00000 ("FRS").
WHEREAS, CLINTEC and FRS have entered into a Contribution Agreement of
even date herewith;
WHEREAS, pursuant to the Contribution Agreement, various patents and
patent applications and other technology were transferred by CLINTEC to
FRS;
WHEREAS, CLINTEC wants to acquire a sublicense to the patents, patent
applications, and technology that were transferred to FRS for use in the
fields of clinical nutrition and nutrition; and
WHEREAS, FRS is willing to grant such a sublicense to Clintec.
NOW THEREFORE, in consideration of the foregoing and of the mutual
covenants set forth below, the parties hereby agree as follows:
1. DEFINITIONS.
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1.1 CLINICAL NUTRITION shall mean the feeding under professional
supervision of patients requiring special food administration techniques
and devices or nutrients in relation to their medical condition and (for
purposes of this Agreement) shall be deemed to exclude the administration
of any product in which the Compounds (as defined below) (i) ********** by
dry weight of the total content of the amino acids, amino acid precursors
and amino acid substrates, or (ii) ********* by weight volume of the
product administered in liquid form to patients, unless FRS otherwise
consents (which consent shall not be unreasonably withheld). Clinical
Nutrition comprises parenteral (intravenous and intraperitoneal) and
enteral (nasogastric, jejunal and oral) nutrition for patient needs in
hospitals, nursing homes, extended care facilities and, if taken under
professional supervision, private residences.
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1.2 CLINICAL NUTRITION PRODUCTS shall mean products used or that can
be used in the field of Clinical Nutrition. Clinical Nutrition Products
include those products that replete nutritional deficits, return naturally
occurring cellular constituents or cellular products toward or to accepted
normal clinical ranges, ameliorate malnutrition, maintain or improve
nutrition status, offset negative nitrogen balance or replete energy
deficit. In biological systems Clinical Nutrition Products are handled by
known metabolic pathways which may or may not be altered by disease state
or clinical condition.
1.3 COMPOUND(S) shall mean any of the molecular entities
L-2-oxothiazolidine-4-carboxylate (Procysteine), its isomers, its esters
(including diesters) and its neutral salts, the cysteine derivative
N-acetyl-cysteine, and glutathione esters (including diesters) including
the alkyl monoesters.
1.4 CORNELL LICENSE AGREEMENT shall mean the "Exclusive License
Agreement CRF D-416 and D-520, D-913, D-169, D-1239, D-1258, D-1403,
D-1426" by and between Cornell Research Foundation Inc. ("Cornell") and FRS
having an Effective Date as of the date of this Agreement.
1.5 CORNELL LICENSED PATENTS shall mean the United States (U.S.) and
non-U.S. patents and patent applications licensed to FRS under the Cornell
License Agreement.
1.6 DATA shall mean all Data and information resulting from any
studies, including stability, toxicology, preclinical and clinicals,
relating to Compounds that was generated prior to the Effective Date of
this Agreement.
1.7 FRS PATENTS shall mean the U.S. and non-U.S. patents identified on
Schedule A attached hereto including any reissues or reexaminations
thereof, as well as any U.S. or non-U.S. patents that may issue from FRS
Patent Applications (defined below).
1.8 FRS PATENT APPLICATIONS shall mean the patent applications
identified on Schedule B attached hereto, as well as any patent application
that is filed after the Effective Date of this Agreement that: is based in
whole, or in part, on the invention records identified on Schedule C;
claims priority, at least in part, from a patent application identified on
Schedule B; is based in whole, or in part, on Licensed Know-How; or is
filed as a divisional, continuation, or continuation-in-part of a patent
application identified on Schedule B.
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1.9 LICENSED KNOW-HOW shall mean any proprietary right in existence as
of the date of this Agreement, other than a patent or patent application,
owned by, controlled by, or licensed to FRS with the right to sublicense
relating to Clinical Nutrition or Clinical Nutrition Products.
1.10 NUTRITION shall mean the feeding of individuals and shall include
all products not having therapeutic claims and not included in the
definition of Clinical Nutrition that have as their principal purpose
providing nutrients to an individual.
1.11 OTHER COMPOUNDS shall have the meaning ascribed to such term in
the Contribution Agreement.
1.12 PHARMACEUTICAL APPLICATIONS shall mean the provision of a
medicinal substance or a drug other than a nutrient with the intent to
bypass or to alter or restore normal in vivo synthesis, metabolic or
physiologic state, including redox status. Generally, medicinal substances
or drugs will be synthetic, specifically isolated or specifically produced
and will require an approved drug license to allow sale and promotion of
the claimed indication regardless of the route of administration. Such
medicinal substances or drugs can be administered alone or with other
entities such as nutrients.
2. GRANT.
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2.1 GRANT TO CLINTEC. In consideration of the Contribution Agreement,
as well as other good and valuable consideration the sufficiency of which
is hereby acknowledged, FRS grants to CLINTEC an exclusive, even as to FRS,
paid-up, royalty-free license to the Other Compounds, FRS Patents, FRS
Patent Applications, and Cornell Patents limited to the field of Clinical
Nutrition and a paid-up, royalty-free non-exclusive license limited to the
field of Nutrition.
2.2 ROYALTY FOR CORNELL PATENTS. To the extent any royalty is due and
owing under the Cornell License Agreement in view of CLINTEC's sale of a
Clinical Nutrition Product under this Agreement, CLINTEC agrees to pay the
applicable royalty to Cornell.
2.3 DATA AND KNOW-HOW. FRS grants to CLINTEC a royalty-free
nonexclusive license to Licensed Know-How. Additionally, FRS will make
available to CLINTEC at no cost to CLINTEC, at CLINTEC's request all Data
for use by CLINTEC in the development and regulatory approvals of Clinical
Nutrition Products.
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CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE EXCHANGE COMMISSION.
ASTERISKS DENOTE SUCH OMISSIONS.
2.4 CLINTEC'S RIGHT OF FIRST REFUSAL. FRS grants to CLINTEC a right of
first refusal to any Clinical Nutrition Product developed by FRS after the
Effective Date of this Agreement and for a period of *******************
********* that is based on or includes Other Compounds or a Compound. The
parties shall negotiate in good faith an exclusive license to such Clinical
Nutrition Product. If the parties fail to reach agreement with respect to
any such Clinical Nutrition Product, FRS may solicit other offers and
engage in negotiations with third parties with respect to that specific
Clinical Nutrition Product. However, prior to concluding any such Agreement
with any third party, FRS must offer CLINTEC the option to accept the
proposed Agreement with respect to the Clinical Nutrition Product on the
terms agreed to with the third party. If CLINTEC does not accept such offer
within forty-five (45) days after written notice by FRS, FRS will be free
to enter into an agreement with the third party on such terms.
2.5 FRS RIGHT OF FIRST REFUSAL. CLINTEC grants to FRS a right of first
refusal to any Pharmaceutical Applications developed by CLINTEC after the
Effective Date of this Agreement and for a period of ******** years
thereafter that is based on or includes a Compound. The parties shall
negotiate in good faith an exclusive license to such Pharmaceutical
Applications. If the parties fail to reach an agreement with respect to any
such Pharmaceutical Applications, CLINTEC may solicit other offers and
engage in negotiations with third parties with respect to that specific
Pharmaceutical Application. However, prior to concluding any such Agreement
with any third party, CLINTEC must offer FRS the option to accept the
proposed Agreement with respect to the Pharmaceutical Applications on the
terms agreed to with the third party. If FRS does not accept such offer
within forty-five (45) days after written notice by CLINTEC, CLINTEC will
be free to enter into an agreement with the third party on such terms.
2.6 FRS NON-COMPETITION. FRS agrees that during the period commencing
on the date of signature of this License Agreement and ending on the *****
anniversary of such date, FRS will not directly or indirectly own, manage,
operate, control, invest or acquire an interest in, or otherwise engage or
participate in (whether as a proprietor, partner, stockholder, joint
venturer, investor, other participant in) the development or sale of
products or compounds that have as their principal purpose Clinical
Nutrition for the purpose of manipulating glutathione levels, anywhere in
the world, or grant any license to any third party for Clinical Nutrition
Products (any such development or sale being herein referred to as a
"Restricted Business"). It is anticipated that a number of products and
compounds may be both a
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Clinical Nutrition Product and have Pharmaceutical Applications and this
Section 2.6 shall not apply to the development or sale of such products or
compounds.
2.7 CERTAIN ACQUISITIONS OF COMPETING BUSINESSES. Notwithstanding the
definition of Restricted Business contained in Section 2.6, the term
Restricted Business shall not include the following business activities:
(a) The acquisition and ownership of not more than 5% of the
outstanding shares of any class of stock or other securities of any entity
which engages in a Restricted Business (a "Competing Business") if such
shares or securities are traded on a national securities exchange or in the
over-the-counter market.
(b) The acquisition and ownership of the outstanding shares of any
class of stock or other securities or assets and properties of a Competing
Business provided that the total fair market value of all assets and
properties of the Competing Business (i) which are acquired, in the case of
an asset purchase, or which are among the assets and properties of such
Competing Business in the Restricted Business, does not exceed the greater
of (A) 5% of the total fair market value of all stock or other ownership
interests or assets or properties of such Competing Business acquired in
such transaction, or (B) $1,000,000; and provided further that upon
acquiring control of such Competing Business or upon acquiring the assets
and properties of such Competing Business which are used in the Restricted
Business, as the case may be, FRS shall offer to sell the assets and
properties of the Competing Business which are used in the Restricted
Business (the "Assets") to Clintec on the following terms and conditions:
FRS shall offer the Assets to Clintec by giving to Clintec prompt written
notice of such offer which offer shall identify, in reasonable detail, the
Assets, the nature and type of transaction which FRS desires to effect with
respect thereto and, if applicable, any indications of interest in or
offers for the Assets which FRS has received (the "Notice"). During the
60-day period after receipt of the Notice (the "Negotiation Period"),
Clintec shall have the right to negotiate with FRS, and if Clintec elects
to do so based upon such negotiations, to make a written offer or offers to
acquire all of the Assets. During the Negotiation Period, FRS agrees to
negotiate with Clintec in good faith, to make available such information as
Clintec may reasonably request with respect to the Assets (subject to
receipt of a customary confidentiality agreement from Clintec) and to
respond promptly to any offer made by Clintec. In the event FRS accepts
Clintec's offer for the Assets, FRS and Clintec agree to enter into a
mutually acceptable definitive agreement with respect
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thereto and to complete the acquisition of the Assets within 60 days of
FRS's acceptance of Clintec's offer (or such longer period as may be
required by regulatory constraints). In the event that during the
Negotiation Period Clintec does not make an offer, or makes an offer or
offers which FRS rejects, FRS is free to (1) retain the Assets and operate
the business associated therewith or (2) sell, assign or otherwise transfer
the Assets after the expiration of the Negotiation Period to an unrelated
third party on terms which are no less favorable, considered as a whole, to
FRS than the terms of Clintec's final bona fide offer.
3. PATENT COSTS.
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3.1 FRS PATENTS AND PATENT APPLICATIONS. FRS shall have the
responsibility to pay all attorney's fees, maintenance fees, and any and
all other costs associated with any FRS Patent or FRS Patent Application.
Should FRS decide not to pay any cost or expense for any FRS Patent or FRS
Patent Application or decide to allow any such FRS Patent or FRS Patent
Application to go abandoned, prior to abandoning such FRS Patent
Application or FRS Patent, FRS shall advise CLINTEC in writing. CLINTEC
shall then have the right to pay such expense and maintain the FRS Patent
or FRS Patent Application. In such case, FRS agrees to assign to CLINTEC
such FRS Patent or FRS Patent Application.
3.2 CORNELL LICENSED PATENTS. To the extent any fees are due and owing
under the Cornell License Agreement for a Cornell Licensed Patent, FRS will
be responsible to pay all costs and expenses. However, prior to allowing
any Cornell Licensed Patent to go abandoned for failure to pay any cost or
expense, FRS shall advise CLINTEC and CLINTEC shall have the right, but not
the obligation, to pay the applicable expense or fee. Should CLINTEC pay
the expense or fee, FRS will then transfer to CLINTEC, to the extent
permitted by the Cornell License Agreement, the rights to the applicable
Cornell Licensed Patent.
4. TERM.
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The term of this Agreement shall last for the effective life of the
last to expire FRS Patent or Cornell Licensed Patent. Upon expiration of
this License Agreement, CLINTEC shall enjoy a royalty-free license to
Licensed Know-How for the purpose of making, using, and selling Clinical
Nutrition Products or products used in the field of Nutrition.
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5. ENFORCEMENT.
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Upon learning of an infringement of an FRS Patent or Cornell Patent,
CLINTEC will advise FRS of such infringement in writing. FRS will then be
free, at its expense, to file a law suit in its name and at its expense
against the infringer. FRS shall be entitled to all damages it recovers. If
FRS does not file a law suit within ninety (90) days of CLINTEC's notice,
CLINTEC, at its cost and expense, can bring suit against the infringer.
CLINTEC will be entitled to all damages it may recover from any such law
suit. FRS agrees, to the extent requested by CLINTEC, to join CLINTEC and
assist CLINTEC, at CLINTEC's expense, in maintaining such law suit.
6. ASSIGNMENT.
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The rights and obligations of CLINTEC under this Agreement can be
assigned to any party by CLINTEC upon thirty (30) days' notice from
CLINTEC.
7. TERMINATION.
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Either CLINTEC or FRS may terminate this Agreement if there is a
material breach of this Agreement by the other party by providing the other
party with written notice of such breach. The breaching party will then
have a six (6) month period in which to cure such breach. If such breach
remains uncured at the end of the six (6) month period, this Agreement will
then terminate.
8. SUBLICENSING.
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CLINTEC may sublicense its rights under this Agreement to any third
party.
9. MISCELLANEOUS.
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9.1 Notices. Any notices to be given under any provision of this
Agreement may be given by sending by registered or certified mail to the
address of the party concerned as follows:
If to FRS: Free Radical Sciences, Inc.
Attn: Chief Executive Officer
000 Xxxxx Xxxxxx
00xx Xxxxx
Xxxxxxxxx, Xxxxxxxxxxxxx 00000
Facsimile: 617/374-1202
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If to CLINTEC: Clintec Nutrition Company
Attn: President
Xxxxx Xxxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxx 00000
Facsimile: 708/317-3180
9.2 APPLICABLE LAW. This Agreement shall be deemed to be made under
and to be governed by the laws of the State of Illinois.
9.3 SEPARABILITY. Should any part or provision of this Agreement be
held unenforceable or in conflict with the law of any jurisdiction, the
enforceability of the remaining parts or provisions shall not be affected
by such holding.
9.4 HEADINGS. The headings and subheadings of the various articles and
sections of this Agreement are inserted merely for the purpose of
convenience and do not express or imply any limitation, definition, or
extension of the specific terms and sections so designated.
9.5 SUCCESSORS AND ASSIGNS. This Agreement is binding on any
successors of FRS or assigns of any FRS Patents, FRS Patent Applications,
Licensed Know-How, or any rights under the Cornell License Agreement.
IN WITNESS WHEREOF, the parties have caused this instrument to be
executed in duplicate as of the day and year first above written.
ATTEST: CLINTEC NUTRITION COMPANY
By /s/ X.X. Xxxxxx
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Title Vice President
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Date April 4, 1996
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Attest: FREE RADICAL SCIENCES, INC.
By /s/ Xxxx X. Xxxx
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Title President
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Date April 4, 1996
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SCHEDULE A TO LICENSE AGREEMENT
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U.S. Patents
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U.S. Patent No. 5,095,027 "Method for Treating Reperfusion
Injury Employing L-2-
oxothiazolidine-4-carboxylic Acid"
Date Issued: March 10, 1992
U.S. Patent No. 5,208,249 "Method for Stimulating
Intracellular Synthesis of
Glutathione Using Esters of
L-2-Oxothiazolidine-4-carboxylate"
Date Issued: May 4, 1993
U.S. Patent No. 5,214,062 "Method and Composition for
Treating Immune Disorders,
Inflammation and Chronic
Infections"
Date Issued: May 25, 1993
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CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE EXCHANGE COMMISSION.
ASTERISKS DENOTE SUCH OMISSIONS.
SCHEDULE B TO LICENSE AGREEMENT
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PENDING PATENT APPLICATIONS
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******* *********************************************
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******* *********************************************
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Corresponding Non-U.S. Applications:
Country Application No. Filing Date
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******** *********** *****************
******** *********** *****************
******** *********** *****************
******** *********** *****************
******* *********************************************
**********
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Corresponding Non-U.S. Applications:
Country Application No. Filing Date
------- --------------- -----------
******** *********** *****************
******** *********** *****************
******** *********** *****************
******** *********** *****************
******* *********************************************
**********
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CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE EXCHANGE COMMISSION.
ASTERISKS DENOTE SUCH OMISSIONS.
Corresponding Non-U.S. Applications:
Country Application No. Filing Date
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******** *********** *****************
******** *********** *****************
******** *********** *****************
******** *********** *****************
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Corresponding Non-U.S. Applications:
Country Application No. Filing Date
------- --------------- -----------
******** *********** *****************
******** *********** *****************
******** *********** *****************
******** *********** *****************
******* *********************************************
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Corresponding Non-U.S. Applications:
*************************************
******* *********************************************
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Corresponding Non-U.S. Applications:
Country Application No. Filing Date
------- --------------- -----------
******** *********** *****************
******** *********** *****************
******** *********** *****************
******** *********** *****************
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CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE EXCHANGE COMMISSION.
ASTERISKS DENOTE SUCH OMISSIONS.
******* *********************************************
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Country Application No. Filing Date
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CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE EXCHANGE COMMISSION.
ASTERISKS DENOTE SUCH OMISSIONS.
Non-U.S. Applications Corresponding to U.S. Patent No. 5,208,249,
"Method for Stimulating Intracellular Synthesis of Glutathione Using
Esters of L-2-Oxothiazolidine-4-Carboxylate"; Date Issued: May 4,
1993:
Country Application No. Filing Date
------- --------------- -----------
******** *********** *****************
******** *********** *****************
******** *********** *****************
******** *********** *****************
Non-U.S. Applications Corresponding to U.S. Patent No. 5,214,062,
"Method and and Composition for Treating Immune Disorders,
Inflammation and Chronic Infections"; Date Issued: May 25, 1993:
Country Application No. Filing Date
------- --------------- -----------
******** *********** *****************
******** *********** *****************
******** *********** *****************
******** *********** *****************
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SCHEDULE C TO LICENSE AGREEMENT
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INVENTION RECORDS
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Xxxxxxxx, "Stimulation of Intracellular Glutathione Synthesis for
Prevention of Diabetic Complications" dated August 8, 1990
Pace et al., "Topical Elevation of Intracellular Glutathione as Treatment
for Psoriasis' dated October 1, 1990
Kamarei, "Diets Containing Glutathione for Hepatic Diseases" dated December
4, 1990
Xxxx et al., "Novel Methods for the Reduction of Difluromethylornithine
Associated Toxicity" dated March 29, 1991
Xxxxxxxx, "Topical Applications of Glutathione Esters for Treatment of
Local Herpes, Bursus and Inflammations" dated April 8, 1991
Xxxx et al., "Method of Treatment of Autoimmune Diseases" dated April 11,
1991
Xxxx et al., "Method of Modifying in Vitro Cell Culture Media to Enhance
Cellular Functions Including Replication" dated July 23, 1991
Xxxx et al., "A Solid Oral Dosage Form for Procysteine" dated July 29, 1991
Xxxxxx, "Amelioration of Valproate Toxicity of Co-adminstration of
Procysteine" dated October 30, 1991
Xxxx, "Methods of Enhancing the Use of Nitric Oxide to Treat Severe Adult
Respiratory Distress Syndrome" dated November 8, 1991
Xxxxxxxx et al., "Method to Reduce Muscle Injury and Damage and Enhance
Recovery from High Intensity Exercise" dated March 31, 1992
Xxxxxxxx, "Method for Enhancing Glutathione Synthesis by Concomitant
Administration of Glutamine and Cysteine" dated April 1, 1992
Xxxx, "Methods of Modifying in Vitro Tissue Culture Media to Enhance
Cellular Functions, Including Replication" dated October 30, 1992
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