DEFINITIVE
MASTER AGREEMENT
BETWEEN
MDI
ONCOLOGY, INC.
AND
EUCODIS
FORSCHUNGS-und ENTWICKLUNGS GmbH
Dated
as
of
July
29,
2006
DEFINITIVE
MASTER AGREEMENT
This
Definitive Master Agreement (“Agreement”) is made and entered into as of July
29, 2006 by and between MDI Oncology, Inc. (“MDI”), a Delaware corporation,
whose principal place of business is 1338 S. Foothill Drive, #266, Salt Lake
City, Utah 84108 and Eucodis Forschungs - und Entwicklungs GmbH (“Eucodis”), an
Austrian company whose principal place of business is Brunner Str. 59, 1230,
Vienna, Austria (collectively MDI and Eucodis shall be referred to as the
“Parties”).
RECITALS
WHEREAS,
MDI, through an asset purchase, has an ownership interest in a pharmaceutical
product known as the “Product”;
WHEREAS,
MDI wishes to have preclinical, clinical, manufacturing and all other
development begun for the Product for purposes of either outlicensing and/or
commercializing the Product;
WHEREAS,
Eucodis has represented that it has the requisite expertise, understanding
and
scientific knowledge to undertake such development under the terms and
conditions hereinafter set forth;
WHEREAS,
MDI has disclosed the means by which it acquired the ownership rights to the
intellectual property related to the Product and any risk or liabilities
associated therewith and Eucodis has disclosed the extent of its experience
in
product development for the oncology field; and
WHEREAS,
both Parties accept the representations made by the other, have executed a
Letter of Intent and wish to enter into this Agreement whereby a license in
the
Field for the Eucodis Territory market is given by MDI to Eucodis and Eucodis
shall pay certain agreed upon sums of money, engage in all development
activities necessary to complete clinical trials as set forth herein and to
then
either outlicense the Product or proceed into Phase III through to
commercialization.
NOW,
THEREFORE, in consideration of the mutual covenants, agreements, representations
and warranties herein, the Parties hereby agree as follows:
1.3 “Bankrupt
Company”
shall
mean SaveTherapeutics AG, a German corporation from whom certain intellectual
property was purchased by MDI, including, but not limited to, the
Product.
1.4 “Clinical
Development Plan”
shall
mean the outline and any and all amendments thereto made during the term of
this
Agreement, the initial copy of which has been tendered to MDI as part of the
Conditions Precedent is attached hereto as Exhibit A and incorporated herein
and
made part of this Agreement along with all subsequent amendments.
1.5 “Confidential
Information”
shall
mean information owned by either Party in any medium, including oral, written
or
electronic, disclosed in connection with this Agreement, along with any trade
secrets, business information, technical information, or marketing information
that the Disclosing Party deems proprietary and has appropriately marked as
such
prior to disclosing such Confidential Information to the Receiving
Party.
1.6 “Disclosing
Party”
shall
mean a Party disclosing Confidential Information to another Party and may
include MDI, Eucodis or both.
1.7 “Eucodis
Territory”
shall
mean the EU and all those countries listed in Exhibit D attached hereto and
made
a part of this Agreement.
1.8 “European
Union”
or
“EU”
shall
mean those countries which are members of the European Union at the time of
the
execution of this Agreement and including Croatia, Norway, Switzerland and
Turkey.
1.9 “European
Union Directives and Regulations”
or
“EU
Regulations” or “EU Directives”
shall
mean all directives and regulations of the European Union and all directives
and
regulations of those European member countries related, or relevant to, drug
development and commercialization.
1.10 “FDA”
shall
mean the United States Food and Drug Administration or any successor
agency.
1.11 “Facility”
or “Facilities”
shall
mean the site where Eucodis selects to have all manufacturing of the Product
done.
1.12 “Federal
Food, Drug and Cosmetic Act”
or
“Act”
shall
mean the federal statute so entitled and all regulations and guidance documents
promulgated thereunder.
1.13 “Field”
shall
mean the development and commercialization of the Product for use in breast
cancer and related breast cancer and mastalgy indications.
1.14 “Good
Manufacturing Practices”
or “GMP”
shall have the meaning set forth in the Act and the corresponding EU Directives.
1.15 “Governmental
Authority”
means
any court, tribunal, arbitrator, agency, commission, official or other
instrumentality of the United States, European Union or any other jurisdiction
applicable to the subject matter contemplated in this Agreement.
1.16 “Inadvertent
Discovery”
shall
mean any invention, patentable or not patentable, which directly and
specifically relates to the Intellectual Property having application outside
the
Field, which is conceived, developed or reduced to practice by either Party
during the term of this Agreement.
1.17 “Intellectual
Property” shall
mean the Product, any improvements thereto and all related inventions, rights
in
confidential information (including know-how and trade secrets) and any other
intellectual property rights, now or hereafter owned, acquired or developed
by
or on behalf of MDI or MDI’s Affiliates or third party contractors to MDI, as
the case may be, during the term of this Agreement, in each case whether
registered or unregistered, and including all applications for and renewals
or
extensions of such rights, and all similar or equivalent rights or forms of
protection.
1.18 “Net
Revenues”
shall
mean the gross cash receipts the Party or it Affiliate obtains from any
unrelated third party in respect of the Product, including but not limited
to
royalties, milestone payments, upfront payments and lump sum
payments.
1.19 “MDI
Territory”
shall
mean the entire world and all its markets except for the Eucodis
Territory.
1.21 “Phase
II” and/or
“Phase
III”
shall
have the same meaning as set forth in the Act and/or the corresponding EU
Directives for clinical trials. For purposes of this Agreement, all references
to Phase II shall mean the completion of Phase II requirements for neo adjuvant
breast cancer indication in the Field.
.
1.24 “Receiving
Party”
shall
mean a Party receiving Confidential Information and may include MDI, Eucodis
or
both.
1.26 “Steering
Committee”
shall
mean the committee formed pursuant to Section 13 of this Agreement.
2. Representations
and Warranties of MDI.
MDI
hereby represents and warrants to Eucodis as follows:
2.1 Organization.
MDI is
a corporation duly organized validly existing and in good standing under the
laws of the State of Delaware, United States of America, and has all requisite
power and authority to own its assets and to carry on its business as presently
conducted. MDI purchased from the bankruptcy estate of the Bankrupt Company,
as
disclosed to Eucodis, the assets thereof, including, but not limited to, the
Product.
2.2 Authority.
MDI has
all requisite power and authority to execute and deliver and perform its
obligations under this Agreement and to consummate the transactions contemplated
by this Agreement.
2.3 Ownership.
MDI has
engaged in disclosure and offered the documents it knows of, and which are
in
its possession concerning or related to the purchase of the Intellectual
Property of the Bankrupt Company and the status of the transfer of those same
assets to MDI from the Bankrupt Company. MDI further warrants that it has,
to
the best of its knowledge, responded to the inquiries by Eucodis concerning
the
subsequent assignment of such Intellectual Property and the pending litigation
in Germany to effectuate the EU ownerships rights subsequent to MDI’s purchase
of such Intellectual Property. MDI has provided to Eucodis updated information
concerning the Status of the Intellectual Property as related to the Product
in
the Eucodis Territory, including but not limited to a copy of the draft
complaint which MDI is contemplating filing in the German courts in order to
perfect assignment of the Intellectual Property.
2.4 Third
Parties.
MDI
represents and warrants that it has not granted a license for the Product,
exclusive or otherwise to any other entity or company for the Field in the
Eucodis Territory.
2.5 Covenant.
MDI
hereby covenants that it will continue to provide information, as it learns
of
such information, related to the Intellectual Property to Eucodis. MDI further
covenants that it will pursue assignment of the such Intellectual Property
where
such assignment has not yet been effectuated in the Eucodis Territory. MDI
will
undertake those acts as may be commercially reasonable to maintain the patents
in the Eucodis Territory which are in force or which may become enforceable
by
MDI, including but not limited to the United Kingdom, Germany, France, Austria,
Italy and Spain. MDI shall pay all costs for patent filings necessary to protect
or related to the Intellectual Property.
2.6 Disclaimer.
All
representations and warranties not expressly made herein, are deemed by the
Parties not to have been made or are expressly disclaimed.
2.7 Valid
and Binding Agreement.
All
acts and approvals required to be taken by or on the part of MDI (corporate
or
otherwise) necessary to enter into this Agreement, consummate the transactions
contemplated by this Agreement and perform its obligations under this Agreement
have been duly and properly taken by MDI. This Agreement has been duly and
validly executed and delivered by MDI, and with it the legal, valid and binding
obligation of MDI, enforceable against MDI in accordance with its terms, subject
to applicable bankruptcy, insolvency and similar laws affecting creditors’
rights generally and to general principles of equity.
2.8 No
Violation , Etc.
The
execution and delivery of this Agreement by MDI, the consummation by it of
the
transactions contemplated by this Agreement, and the performance by it of its
obligations under this Agreement does not, and will not at all relevant times,
(i) violate or conflict with any provision of the charter documents of MDI;
(ii)
violate, or conflict with, or result in a breach of any provision of, or
constitute a default (or give rise to any right of termination, cancellation
or
acceleration) under, any of the terms, conditions or provisions of any agreement
lease, instrument, obligation, understanding or arrangement to which MDI is
a
party or by which any of MDI’s properties or assets is subject, or (iii) result
in a violation by MDI of any law to which MDI or any of its properties or assets
are subject. There is no litigation, proceeding, investigation, arbitration
or
claim pending, or, to MDI’s knowledge, threatened against MDI, and there is, to
MDI’s knowledge, no reasonable basis for any such action, which affects in whole
or in part MDI’s ability to consummate the transactions contemplated by this
Agreement or the performance of MDI’s obligations hereunder.
2.9 Consents
and Approvals; Transfer.
No
permit, consent, approval or authorization of, or declaration, filing or
registration with, any Governmental Authority or other third party is or will
be
necessary to be made or obtained by MDI in connection with (i) the execution
and
delivery by MDI of this Agreement, (ii) the consummation by it of the
transactions contemplated under this Agreement, or (iii) the performance by
MDI
of its obligations under this Agreement except as set forth herein.
3. Representations
and Warranties of Eucodis.
Eucodis
hereby represents and warrants to MDI as follows:
3.1 Organization.
Eucodis
is a company duly organized, validly existing and in good standing under the
laws of Austria and has all requisite power and authority to own its assets
and
to carry on its business as presently conducted.
3.2 Authority.
Eucodis
has all requisite power and authority to execute and deliver and perform its
obligations under this Agreement and to consummate the transactions contemplated
hereby, including the exclusive right to develop and commercialize the
Product.
3.3 Financing.
Eucodis
hereby warrants and represents that it has the money available to pay MDI under
Section 12.1 of this Agreement and that such payment will have priority over
all
other claims made as permitted by law.
3.4 Due
Diligence.
Eucodis
represents and warrants that it has had ample opportunity to and in fact has
engaged in extensive due diligence concerning the science of the Product, the
business practices of the Bankrupt Company and any irregularities related
thereto, and has reviewed all documents memorializing the science and transfer
of the Intellectual Property. Eucodis further represents and warrants that
prior
to entering into this Agreement it has been fully informed of the pending
litigation and/or dispute in Germany to effectuate all EU ownership rights
in
the Eucodis Territory in those countries which have not yet recognized MDI’s
ownership in the Product. Eucodis represents, warrants and covenants that it
fully aware of any risks attendant to MDI’s purchase from the Bankrupt Company
and accepts such risks. Eucodis acknowledges that no valid Product patent will
be obtained in either Portugal or Cypress, but that the license hereunder is
extended to those countries.
3.5 Conditions
Precedent.
The
Parties acknowledge that the following Conditions Precedent must have been
performed and completed by Eucodis prior to the execution of this
Agreement:
a) Eucodis
has provided MDI evidence that it has the funds to make the payments to MDI
as
set forth in Section 12.1 herein;
b) Eucodis
has provided MDI a copy of the data concerning the potential market for the
Intellectual Property which Eucodis has provided to its investors which is
attached as Exhibit B hereto;
c) Eucodis
has provided to MDI any and all information that it has obtained on work
commissioned by the Bankrupt Company concerning the development of the Product
which is attached as Exhibit C hereto; and
d) Eucodis
has provided to MDI its outline plan to finance the Clinical Development Plan
and to make the milestone payments set forth in Section 12.1 herein.
3.6 Covenant.
Eucodis
hereby covenants that it will continue to provide information as it learns
of
such information to MDI, related to the Intellectual Property. Eucodis further
covenants that a complete Clinical Development Plan will be delivered to MDI
within ninety days of execution of this Agreement and Eucodis further covenants
that updates of that Plan will be provided to MDI as the Clinical Development
Plan is amended throughout the term of this Agreement.
3.7. Disclaimer.
All
representations and warranties not expressly made herein, are deemed by the
Parties not to have been made and expressly disclaimed.
3.8.
Valid
and Binding Agreement.
All
acts and approvals required to be taken by or on the part of Eucodis (corporate
or otherwise) necessary to enter into this Agreement, consummate the
transactions contemplated by this Agreement and perform its obligations under
this agreement have been duly and properly taken by Eucodis. This Agreement
has
been duly and validly executed and delivered by Eucodis, and it is the legal,
valid and binding obligation of Eucodis, enforceable against Eucodis in
accordance with its terms, subject to applicable bankruptcy, insolvency and
similar laws affecting creditors’ rights generally and to general principles of
equity.
3.9. No
Violation , Etc.
The
execution and delivery of this Agreement by Eucodis, the consummation by it
of
the transactions contemplated by this Agreement, and the performance by it
of
its obligations under this Agreement does not, and will not at all relevant
times, (i) violate or conflict with any provision of the charter documents
of
Eucodis, (ii) violate, or conflict with, or result in a breach of any provision
of, or constitute a default (or give rise to any right of termination,
cancellation or acceleration) under, any of the terms, conditions or provisions
of any agreement lease, instrument, obligation, understanding or arrangement
to
which Eucodis is a party or by which any of Eucodis’ properties or assets is
subject, or (iii) result in a violation by Eucodis of any law to which Eucodis
or any of its properties or assets are subject. There is no litigation,
proceeding, investigation, arbitration or claim pending, or, to Eucodis’
knowledge, threatened against Eucodis, and there is, to Eucodis’ knowledge, no
reasonable basis for any such action, which affects in whole or in part Eucodis’
ability to consummate the transactions contemplated by this Agreement or the
performance of Eucodis’ obligations hereunder.
3.10. Consents
and Approvals; Transfer.
No
permit, consent, approval or authorization of, or declaration, filing or
registration with, any Governmental Authority or other third party is or will
be
necessary to be made or obtained by Eucodis in connection with (i) the execution
and delivery by Eucodis of this Agreement, (ii) the consummation by it of the
transactions contemplated under this Agreement, or (iii) the performance by
Eucodis of its obligations under this Agreement.
4. Grant
of Licensing/Commercialization Rights.
4.1. Grant.
Subject
to the terms and conditions set forth in this Agreement, MDI hereby grants
Eucodis the exclusive license to develop, manufacture and commercialize the
Intellectual Property of the Product in the Eucodis Territory for use in the
Field with the right to outlicense after completion of Phase II. The Parties
agree that both the Eucodis Territory and the Field may be expanded upon the
written agreement of the Parties. MDI agrees that prior to engaging in
discussions with any other third party for a license which would otherwise
have
the effect of expanding the Field in the Eucodis Territory, MDI will notify
Eucodis that such discussions will take place and Eucodis may request within
five days of MDI’s notice, that MDI engage in similar discussions with Eucodis.
This grant is limited by the description and the uses contained within the
Product’s patent as filed in the Eucodis Territory. Eucodis further acknowledges
and accepts that as part of this grant of exclusive license in for the Field
in
the Eucodis Territory, Eucodis is obligated to develop, manufacture and complete
all preclinical and clinical testing up to the completion of Phase II as set
forth in the Clinical Development Plan which is attached hereto as Exhibit
A, by
June 1, 2009. The Parties hereto expressly acknowledge that nothing in this
grant of license, nor within the terms of this Agreement shall have the effect
of transferring ownership of the Intellectual Property from MDI to Eucodis
or
any other third party.
4.3 Improvements,
New Inventions and First Refusal.
The
Parties recognize that as a result of preclinical and clinical development,
improvements or new inventions may be discovered by one Party or the other
or by
a third party contracted to perform work related to the Product. All such know
how, improvements and intellectual property which shall be the direct or
indirect result and related to the development or manufacture or
commercialization of the Product shall belong solely to MDI. Eucodis shall
use
commercially reasonable to obtain all necessary executed documents from any
contracted third party acknowledging this Intellectual Property ownership right
to the extent allowed by applicable law. Eucodis shall have the exclusive
license with no incremental royalties owed and due MDI beyond that which is
set
forth herein, to use any such technology, know-how or improvements for the
Product, however, both Parties shall have a paid up right to use such
technology, know-how, or improvements after the termination of this Agreement
for whatever reason without any territiorial restrictions. However during the
development of the Product, the Parties recognize that Eucodis and/or any of
its
subcontractors may make an Inadvertent Discovery outside the Field of an
unrelated non-oncology improvement or new use for the Product which shall have
value and meaning to both Parties. The Parties agree that in the event of such
Inadvertent Discovery, the new invention shall be submitted to the Steering
Committee for evaluation of market value, to oversee the process of protecting
the new invention through patent filings (where applicable) and to establish
a
value for such Inadvertent Discovery. MDI shall have the first opportunity
to
purchase Eucodis’s half of the Inadvertent Discovery at half the value
established by the Steering Committee. Eucodis will have the right to purchase
MDI’s half interest at the value established by the Steering Committee if MDI
does not exercise its right to buy the Inadvertent Discovery within 120 days
of
value being established by the Steering Committee. The Inadvertent Discovery
shall be jointly owned by the Parties, unless either Party wishes to sell its
half interest to the other at the fair market value of the Inadvertent Discovery
as determined by the Steering Committee. However, for as long as the Inadvertent
Discovery is owned jointly by the Parties, the Parties shall share equally
all
costs for any patent filings necessary to protect the Inadvertent Discovery
as
well as costs of preclinical and clinical work to commercialize the Inadvertent
Discovery. Eucodis shall have an ongoing obligation to notify MDI in writing
of
any and all improvements, new inventions and Inadvertent Discoveries.
4.4.1
The
Parties acknowledge that during the term of this Agreement that data will be
generated and collected related to the science, method of use, and method of
action of the Product. The Parties further acknowledge that that data is
proprietary to the Product and for purposes of this Agreement shall be deemed
integral to the protection of the Intellectual Property. All data created or
collected by Eucodis during the development of the Product, shall be placed
in a
format and form by Eucodis which shall be acceptable to the FDA and shall be
the
property of MDI subject to a license to Eucodis for the right to use such data
for purposes of this Agreement. Eucodis’ ownership of such data shall be limited
to the grant of this license under this agreement. Should the data collected
by
Eucodis and used by MDI for filing with the FDA in the United States be deemed
unacceptable to the FDA, by the FDA and require additional work or data, such
additional work or data generation and collection (as well as testing if
required by the FDA) shall be done at Eucodis’ cost provided that MDI only files
for the same indications in the U.S. as Eucodis files for in the Territory.
At
no time shall Eucodis be held responsible for additional FDA costs where such
costs are the result of unanticipated regulatory changes by the FDA and which
have not been published to the public prior to that change, Should MDI learn
of
FDA regulatory changes it will notify Eucodis of such changes in a timely manner
however, this in no way abrogates Eucodis’ obligations hereunder. Upon the
termination of this Agreement and no renewal hereof, all such data shall be
promptly returned to MDI unless otherwise agreed to in writing by the
Parties.
4.5 License
Reversion.
The
Parties acknowledge that time is of the essence to the value of this License
as
well as the leadership of Wolfgang Schoenfeld at Eucodis. Therefore, if any
of
the following events occur, MDI shall have the unilateral right to terminate
this Agreement upon thirty (30) days written notice to Eucodis which shall
only
be given after the expiration of the cure period where one is provided for
herein, at no cost to MDI except for paragraph (d) in this Section 4.6 which
shall subject to an immediate termination:
a)
should
at any point, Wolfgang Schoenfeld, resign or be involuntary removed for other
reasons other than permanent disability or death from his current role as Chief
Executive Office of Eucodis before completion of Phase II or prior to December
31, 2007 whichever is earlier; or
b)
should
Eucodis fail to have permission of the appropriate regulatory bodies in the
Eucodis Territory to begin clinical trials of the Product as set forth in the
Clinical Development Plan and
Eucodis fails to cure this breach to the reasonable satisfaction of MDI, within
sixty days after either delivery to MDI of written notice of the breach or
upon
MDI’s discovery of such breach and written notice is given to Eucodis;
or
c)
should
Eucodis fail to complete Phase II clinical trials as defined by the Act with
all
data collected and evaluated in a form acceptable to EU regulatory authorities
in the Eucodis Territory and the FDA as set forth in the Clinical Development
Plan and Eucodis fails to cure this breach to the reasonable satisfaction of
MDI, within sixty days after either delivery to MDI of written notice of the
breach or upon MDI’s discovery of such breach and written notice is given to
Eucodis; or
d)
should
Eucodis suspend or discontinue its business operations or make any assignment
for the benefit of its creditors or commence voluntary proceedings for
liquidation in bankruptcy, or admit in writing its inability to pay its debts
generally as they become due, or consent to the appointment of a receiver,
trustee or liquidator of all or any part of its property, or if there is an
execution sale of a material portion of its assets or if involuntary bankruptcy
or reorganization proceedings are commenced against Eucodis or any of its
properties or if a receiver or trustee is appointed for Eucodis or any of its
properties and such proceedings are not discharged within thirty (30)
days.
However,
if Eucodis is unable to cure the breaches in 4.6(b) and/or(c) because there
has
been a unanticipated change to the EU Directives, which had not been published
to the public prior to that change, then MDI shall still give receive/notice
as
provided in those paragraphs 4.6 (b) and (c) but the cure period shall be extend
for a reasonable period of time not to exceed a total cure period of one hundred
twenty days.
Should
any of these events occur and MDI exercise its right to terminate this
Agreement, all rights concerning the Intellectual Property including but not
limited to, all rights to data and Inadvertent Discoveries revert back to or
become the sole property of MDI and MDI shall bear the costs of transferring
the
data and the Intellectual Property hereunder and, should it to do so, assumption
of the assignment of any subcontracts hereunder.
Should
the Agreement terminate under 4.6(b) and/or (c) above due to a failure of
Eucodis which was caused by the reasons out of its reasonable control, MDI
and
Eucodis will in good faith negotiate what reasonable costs are reimbursable
to
Eucodis.
Should
MDI suspend or discontinue its business operations or make any assignment for
the benefit of its creditors or commence voluntary proceedings for liquidation
in bankruptcy, or admit in writing its inability to pay its debts generally
as
they become due, or consent to the appointment of a receiver, trustee or
liquidator of its property obtained from the Bankrupt Company, or if there
is an
execution sale of a material portion of its assets purchased from the Bankrupt
Company or if involuntary bankruptcy or reorganization proceedings are commenced
against MDI or if a receiver or trustee is appointed for MDI or any of its
properties purchased from the Bankrupt Company and such proceedings are not
discharged within thirty days, Eucodis will have the right to terminate this
Agreement and if termination occurs, Eucodis shall, in addition to the rights
set forth in 15.2 ( c ) below, have the right, as directed by the liquidator,
trustee or receiver, to purchase the Intellectual Property known as the Product
for fair market value.
5. Out
Licensing.
5.1 Royalties.
In the
event that Phase II clinical trials are completed and the Product is out
licensed to a third party for any indication in the Field for the Eucodis
Territory, Eucodis shall pay royalties to MDI the percentage of Net Revenues
received by Eucodis from a third party outlicense as set in 5.1.1 herein. MDI
will be paid by Eucodis its percentage of Net Revenue in United States dollars.
When Net Revenue is paid to Eucodis in Currency other than United States
dollars, the rate of exchange to be used for converting such other currency
into
United States dollars shall be at the exchange rates stated in the Wall Street
Journal on the date that payment is received by Eucodis. All costs to convert
the currency into United States dollars will belong to Eucodis. The amount
payable to MDI is due to MDI ten days after the month ending in which the
payment was received by Eucodis. Any tax paid or required to be withheld by
Eucodis for the benefit of MDI on any payments payable to MDI under this
Agreement shall be deducted from the amount of payments otherwise due MDI.
No
outlicense shall be for longer than the term of this Agreement and at the end
of
that out license all rights remaining in the Intellectual Property, data of
any
kind related to the Intellectual Property and any other information about the
market for the Intellectual Property must revert back to MDI unless otherwise
agreed to, in writing, by MDI. For purposes of this section 5 of this Agreement,
the Product shall be deemed to remain in Phase II until the following three
events have all occurred: i) the Steering Committee has agreed on a Phase III
clinical trial plan and cost estimate attendant thereto; ii) both Eucodis and
MDI have secured funding for fifty percent (50%) each of the costs of Phase
III;
and iii) the appropriate regulatory bodies have approved the Phase III Clinical
Trial protocol and have consented to entry into the clinic to commence Phase
III
Clinical Trials.
5.1.1 Should
Eucodis negotiate an out license for the Eucodis Territory at the end of Phase
II, the Parties agree that the royalty payments and any upfront payments
received from the outlicensor shall be paid as set forth in this paragraph
5.1.1.
|
Net
Revenue
Received
by Eucodis
from
Third Party Out-
License
in EU Market
|
Cumulative
Net
Revenue
Received
by
Eucodis
from
Third
Party Out-
License
in EU
Market
|
%
of Net
Revenue
Retained
by
Eucodis
|
%
of Net
Revenue
Paid
to MDI
as
Royalty
|
Eucodis
Net
Cash
after
Payment
of MDI
Royalty
|
MDI
Royalty
Payment
|
|
0-40,000,000
|
40,000,000
€
|
90%
|
10%
|
36,000,000
€
|
4,000,000
€
|
|
40,000,001-80,000,000
|
80,000,000
€
|
85%
|
15%
|
34,000,000
€
|
6,000,000
€
|
|
80,000,001-120,000,000
|
120,000,000
€
|
80%
|
20%
|
32,000,000
€
|
8,000,000
€
|
|
120,000,001-160,000,000
|
160,000,000
€
|
75%
|
25%
|
30,000,000
€
|
10,000,000
€
|
|
160,000,001-200,000,000
|
200,000,000
€
|
70%
|
30%
|
28,000,000
€
|
12,000,000
€
|
|
200,000,001-240,000,000
|
240,000,000
€
|
65%
|
35%
|
26,000,000
€
|
14,000,000
€
|
|
240,000,001-280,000,000
|
280,000,000
€
|
60%
|
40%
|
24,000,000
€
|
16,000,000
€
|
|
280,000,001-320,000,000
|
320,000,000
€
|
55%
|
45%
|
22,000,000
€
|
18,000,000
€
|
|
320,000,001-360,000,000
|
360,000,000
€
|
50%
|
50%
|
20,000,000
€
|
20,000,000
€
|
|
Thereafter
|
50%
|
50%
|
|
|
|
5.1.2 Should
the Steering Committee decide to move forward with a Phase III Clinical Trial
the cost of the Phase III Clinical Trial shall be borne by the Parties on a
fifty percent (50%) each basis. Should Eucodis negotiate an out license for
the
Eucodis Territory at the end of Phase III, the Parties agree that the royalty
payments and any upfront payments received from the outlicensor shall be paid
as
set forth in this paragraph 5.1.2. In the event of no third party license,
any
and all drafting and filing costs incurred in preparing the documents to be
filed with the E.U. Governmental Authorities seeking approval to market shall
be
borne equally by the Parties.
|
Net
Revenue
Received
by
Eucodis
from Third Party Out-License
in
EU Market
|
Net
Revenue Received by Eucodis from
Third
Party Out-License in EU Market
|
Cumulative
Net
Revenue
Received by Eucodis from
Third
Party Out-
License
in EU Market
|
%
of Net Revenue Retained by Eucodis
|
%
of Net Revenue Paid to MDI as Royalty
|
Eucodis
Net
Cash
after Payment
of
MDI Royalty
|
MDI
Royalty Payment
|
|
60,000,000
€
|
0-60,000,000
|
60,000,000
€
|
90%
|
10%
|
54,000,000
€
|
6,000,000
€
|
|
60,000,000
€
|
60,000,001-120,000,000
|
120,000,000
€
|
85
|
15
|
51,000,000
€
|
9,000,000
€
|
|
60,000,000
€
|
120,000,001-180,000,000
|
180,000,000
€
|
85
|
15
|
51,000,000
€
|
9,000,000
€
|
|
60,000,000
€
|
180,000,001-204,000,000
|
240,000,000
€
|
85
|
15
|
51,000,000
€
|
9,000,000
€
|
|
60,000,000
€
|
240,000,001-300,000,000
|
300,000,000
€
|
70
|
30
|
42,000,000
€
|
18,000,000
€
|
|
60,000,000
€
|
300,000,001-360,000,000
|
360,000,000
€
|
65
|
35
|
39,000,000
€
|
21,000,000
€
|
|
Thereafter
|
65
|
35
|
288,000,000
€
|
72,000,000
€
|
| |
|
|
80%
|
20%
|
5.1.3 Should
the Parties agree to allow Eucodis to commercialize the Product before such
commercialization occurs, the Steering Committee must meet and agree that
commercialization is feasible within the EU Territory as expanded in Exhibit
D
attached hereto and made part of this Agreement, and that Eucodis has the
resources and ability to commercialize the Product. The Parties agree to
negotiate in good faith the terms of the commercialization but in no event
shall
the monetary terms of the commercialization fail to adequately reimburse the
Parties for each of the Parties Phase III clinical trial costs. If the
management teams of each of the Parties cannot reach agreement on the
commercialization terms within a commercially reasonable time then the
commercialization issues and any and all terms agreed upon and at issue shall
be
turned over to the Chief Executive Officers of each of the Parties who shall
then have thirty days from the date of receipt to reach agreement. If the Chief
Executive Officers cannot reach agreement within the thirty days, the Parties
shall name a mutually agreed upon mediator within ten days and if the Parties
cannot agree on a mediator then each side shall name a mediator which shall
jointly mediate to resolution. If only one mediator is used, the Parties shall
share the cost of such mediator and if two mediators must be named then each
Party shall bear the cost of its named mediator. Mediation shall take place
in
the United States. Any terms and conditions of commercialization regardless
of
how agreement on such terms and conditions are reached, must be acceptable
to
MDI and their consent to those terms cannot be unreasonably
withheld
5.2 Approval.
MDI
shall have the final right of approval on any out licensing deal, such approval
shall not be unreasonably withheld. Under no circumstance shall Eucodis consider
or enter into discussion concerning an out licensing deal prior to the
completion of Phase II clinical trials without the prior written consent of
MDI.
Eucodis agrees to inform MDI immediately of any outlicense deal it is
contemplating and the terms thereof prior to engaging in negotiations. No
letters of intent or any other binding or nonbinding documents shall be executed
by Eucodis related to an outlicense for the Product in the Eucodis Territory
without first providing a copy of such document to MDI and MDI having an
opportunity to comment thereon.
5.3 Global
License.
The
grant of the license as set forth in this Agreement, to Eucodis is subordinate
to MDI’s ability to execute a global license deal which would include the
Eucodis Territory. MDI shall control and lead all global licensing negotiations
and Eucodis shall have the right to be reasonably involved in the process.
Eucodis expressly agrees that should it be approached by a third party
interested in a global license that such third party must be referred to MDI
immediately. MDI expressly agrees that should it be approached by a third party
interested in a global license, MDI will immediately inform Eucodis. If MDI
executes a global license Eucodis shall be entitled to a percentage of the
global license which reflects the percentage of the EU for the Product in the
Field in the global market. This market percentage shall be the average of
three
leading market share reports, selected by the Steering Committee, reflecting
the
value of the Products market. MDI and Eucodis will share the Net Revenues from
the global licensor according to market share percentages which accurately
reflects the percentage of the EU for the Product in the Field in the global
market.
5.4 Audit
Rights.
MDI has
the right to ask for an audit of all costs incurred by Eucodis in Phase II,
and/or royalties and any other payments made to Eucodis by the licensor of
any
out license contemplated hereunder. Eucodis will grant an independent certified
public accountant, selected by MDI and reasonably acceptable to Eucodis which
acceptance shall not be unreasonably withheld, access to all Eucodis books
and
records relevant to this Agreement necessary to verify the accuracy of reports
provided, royalties paid and costs incurred under this Agreement. MDI must
provide at least ten business day’s written notice to Eucodis prior to the
commencement of the audit and may not audit Eucodis more than once a year
without good cause. The audit shall initially be at MDI’s expense, however,
should the audit reveal that monies are owed MDI, as a result of this audit,
then Eucodis must pay those monies within ten days plus 7% interest from the
time the monies were originally due. If an inaccuracy in the payments to MDI
is
greater than five percent (5%), Eucodis shall pay the cost of the
audit.
5.5 Termination.
The
duration of the Agreement and therefore the payment obligations of Eucodis
shall
last until the expiration of the last relevant Product patent in the Eucodis
Territiory and for one year thereafter if MDI’s Intellectual Property is still
substantial and confidential, or unless otherwise terminated under the
termination provisions contained in Section 16 of the Agreement. Nothing here
shall be deemed to limit the Parties rights to negotiate a subsequent license
and marketing agreement for the Territory once this Agreement
terminates.
6. Ownership;
Trademarks; Proprietary Information.
6.1 Ownership.
Any
trademarks, trade names, brand names, patents, slogans, logos, copyrights,
trade
dress, know-how and goodwill associated with the Product shall be the sole
and
exclusive property of MDI, including but not limited to any improvements or
modifications to this property for the Product in the Field and shall be held
in
confidence by Eucodis for MDI’s sole benefit in the development and/or the
operation of manufacturing processes with respect to the Product. Eucodis shall
disclose to MDI and receive the approval of MDI with respect to all such
improvements or modifications relating to the manufacturing, and/or packaging
process of the Product or use of the Products developed by Eucodis. Eucodis
shall have no right or license to use any such rights at any time before, during
or after the Term of this Agreement, except as necessary for the manufacture,
processing, packaging and supply of Product to MDI hereunder.
(a) It
is
agreed that MDI is the sole owner of any and all Specifications supplied or
paid
for by MDI, and Eucodis shall not use any such Specifications except in
connection with its performance under this Agreement.
(b) The
provisions of this Section 6.1 shall survive the termination or expiration
of
this Agreement.
(c) The
parties agree that they shall jointly own all preclinical and clinical trial
documents, any and all documents filed with the E.U. regulatory approval boards,
and all marketing materials developed by Eucodis for the Product in the Field
for use in the Eucodis Territory. However, Eucodis agrees that all such
documents listed herein shall only be used for those purposes set forth herein.
6.2 Assignment
of Rights.
MDI
shall use commercially reasonable efforts to continue to pursue the assignment
of the patent rights in the Product to the extent such assignment has not yet
been effectuated in the Eucodis Territory.
6.3 Information
Sharing.
Each
Party shall promptly share with the other Party any additional information
it
gains relating to the Intellectual Property.
7.1 Access
to
Confidential Information shall be limited to the respective employees and
consultants of the Parties and their counsel unless a confidentiality and
nondisclosure agreement is executed by any third party prior to such disclosure.
7.2 This
Confidential Information is to be used for the sole purpose of carrying out
the
purposes of this Agreement.
7.3 The
Party
disclosing the Confidential Information shall use it best efforts to ensure
that
the recipient of the Confidential Information shall not disclose it to any
other
individual entity, or cause or allow such Confidential Information to be
disclosed, except that he or she may discuss the Confidential Information with
other employees, consultants, or attorneys who have been identified the Parties
as necessary to receive it.
7.4 To
the
extent that a nonparty is provided documents which contain or are Confidential
Information by a Party for purposes of developing, manufacturing or the running
of clinical trials, such documents are not to be photocopied, scanned or
reproduced in any other way, and are to be returned to the Disclosing Party
upon
its request, with the exception of permissible reproduction for a single
archival copy to be maintained as Confidential Information by the Receiving
Party if such Receiving Party is either a Party hereto or is required by the
Act
or other relevant laws and regulations to retain a copy.
7.5 Neither
Party will assert that anything disclosed or discussed constitutes a waiver
of
attorney-client privilege or attorney work-product.
7.6 This
Agreement shall not apply to: (i) information produced or disclosed in discovery
in subsequent litigation between the parties, should that materialize, (ii)
information which now or hereafter becomes generally known or available to
the
public without Receiving Party’s breach of any obligation owed to the Disclosing
Party, or (iii) information which was in the possession of the Receiving Party
prior to execution of this Agreement and which was not previously obtained
by
the Receiving Party from the Disclosing Party, and is so documented by the
Receiving Party prior to the date of this Agreement, or (iv) information that
comes into possession of the Receiving Party after execution of this Agreement
from a third party having legal right to disclose such information, or (v)
information that is independently developed by or for the Receiving Party
without aid or reference to the disclosed Confidential Information of the
Disclosing Party; or (vi) information that is disclosed in a press release
agreed to by both Parties, or information that Parties otherwise agreed in
writing to publish. Provided however, that disclosure of information otherwise
the subject of this Agreement that is provided to customers and potential
customers, in furtherance of the purpose of this Agreement or other agreements
between the parties, shall not be considered to remove such Confidential
Information from the subject matter of this Agreement.
7.7 If
a
party breaches any of its obligations with respect to confidential and
unauthorized use of Confidential Information hereunder, the non-breaching party
shall be entitled to equitable relief to protect its interest therein, including
but not limited to injunctive relief, as well as money damages notwithstanding
anything to the contrary contained herein.
8. Development
and Clinical Work.
8.1 Co-Development
License.
Integral to this license is an obligation of Eucodis to develop the Product
for
the EU while capturing data in a form which will be acceptable to the FDA.
Such
license shall include, but is not limited to, specific and articulated rights
as
to the development of the Product, the completion of all necessary preclinical
and clinical work through Phase II clinical trials as defined by the Act,
payment for and the acquisition of all CMC data performed prior to MDI’s
purchase of the Product as per Section 8.2 below, and entry into the clinic
for
purposes of performing clinical trials.
8.2 Data
Collection.
The
Parties hereto acknowledge that there are certain companies which currently
possess necessary Product data including, but not limited to, data constituting
the Drug Master File as defined within the Act, reports of studies with
supporting data already completed and stability data which Eucodis should
obtain. The Parties further acknowledge that this prior work resulting in this
information was included in MDI’s asset purchase from the Bankrupt Company and
that outstanding unpaid bills have caused such data and information to be held
by those companies owed money by the estate of the Bankrupt Company. Eucodis
shall pay up to Euro 70,000 from its own finances with no back charge to MDI
in
order to obtain the data referred to in herein. Should either Eucodis or MDI
discover that there is additional necessary scientific data which was
commissioned by the Bankrupt Company for which funds in excess of Euro 70,000
are needed, then the Chief Executive Officers of each of the parties shall
meet
to determine whether to incur the expense and how to apportion the cost. If
the
Chief Executive Officers cannot agree on the need for the expenditure, then
they
may submit it to the Steering Committee for resolution.
8.3 Protocols.
Any and
all preclinical and clinical trial protocols used by Eucodis for purposes of
obtaining EU drug approval, must meet the FDA guidelines for acceptance of
clinical data from trials performed outside of the United States. Eucodis shall
provide copies of all such protocols to MDI upon completion of the drafting
of
the protocols prior to commencement of the clinical trials pursuant to those
protocols.
8.4 Right
to Audit the Data.
In
accordance with the applicable privacy regulations, each Party shall have the
right, throughout the term of this Agreement, to audit any and all preclinical
and clinical trial work being performed, either directly or indirectly related
to the Intellectual Property. The audit shall be at the expense of the auditing
Party. Should the auditing Party learn, as a result of the audit, discrepancies
or errors in data collection or compliance with regulations under the Act,
then
the auditing Party shall notify the other Party in writing of these
discrepancies and or errors and the nonAuditing Party shall correct these
discrepancies and errors at its own costs. Nothing herein shall be deemed a
waiver of Eucodis obligation hereunder to supply data which is acceptable to
the
FDA and meets the requirements as set forth in the Act and the ensuing
regulations. If MDI does not inform Eucodis on any discrepancies and/or errors,
it is understood that data are acceptable and meet the requirements of FDA
and
Eucodis shall not be liable for any cost of eventual later action or studies
required by FDA.
9. Manufacturing
.
9.1 Exclusive
Right.
Integral to the exclusive license hereunder, Eucodis shall be solely responsible
for the manufacture the Product for the Eucodis Territory while ensuring that
there is sufficient supply for all stages of preclinical and clinical
development in accordance with the clinical Development Plan for the concurrent
development in the United States. Eucodis shall enter in to an agreement with
a
contract manufacturer which meets all FDA cGMP requirements and the corollary
EU
requirements. Eucodis shall not select a contract manufacturer which has failed
and FDA site inspection, which is incapable of passing such FDA site inspection
and which cannot manufacture per Product specifications, meet storage
requirements, perform quality tests and checks. Eucodis shall notify MDI when
it
enters into such an agreement and shall ensure the integrity of all MDI’s
Intellectual Property, proprietary business information and the non disclosure
thereof. Eucodis shall have the responsibility for managing the contract
manufacturer including the protection of the Product as an MDI asset. Eucodis
shall be responsible for working with the manufacturer in collecting and
ensuring that all API and Batch as those terms are defined in the Act and other
manufacturing records for the European Union comply with all FDA and EU
requirements
9.2 Purchase
and Installation of Equipment.
The
installation, qualification and maintenance of all equipment at the
manufacturing Facility shall be conducted in accordance with all applicable
laws, rules and regulations and any relevant specifications.
9.3 Purchase
of Labels and Packaging.
Eucodis
shall develop all label and packaging specifications ensuring that such labels
and packaging comport with the applicable EU requirements which are necessary
for transporting the Product to the preclinical or clinical sites.
9.4 Agreement
to Supply.
During
preclinical and clinical development of the Product MDI will purchase its
Product from Eucodis. MDI shall be entitled to a discount off purchase price
as
set forth herein. Subject
to the terms and conditions of this Agreement, MDI shall be able to obtain
the
Product produced under Agreement at Eucodis’cost plus ten percent (10%). Cost
plus ten percent shall not include any shipping, administrative costs or
handling costs incurred by either Eucodis or the contract manufacturer. The
sum
of cost plus ten percent shall be determined by the Eucodis invoice from the
contract manufacturer to Eucodis plus ten percent and a copy of such invoice
must be attached to the Eucodis invoice to MDI for the Product requested by
MDI.
9.5 Required
Tolerance.
Eucodis
shall ensure that the Product is manufactured and packaged pursuant to the
Product Specifications and as required by the applicable Governmental
Authorities.
9.8 Product
for Clinical Trials.
Eucodis
shall ensure that there is a sufficient supply of the Product according to
the
Development Plan for use in both the EU and the United States clinical trials
and for sampling should MDI require such samples.
9.12 General
Representations and Warranties.
Eucodis
hereby represents, warrants and covenants to MDI that the Product furnished
by
Eucodis through the contract manufacturer: (i) shall be of the quality specified
in, and shall conform with, the Specifications, and (ii) shall be manufactured,
processed, packaged, stored and delivered in conformity with the Specifications
and all applicable laws, rules and regulations including current good
manufacturing practices. In addition, Eucodis warrants to MDI that Eucodis
has
not and will not use any materials that would cause the Product to be
adulterated within the meaning of Section 501 of the Act, as amended from time
to time, and further, the Product shall not be misbranded within the meaning
of
the Act. Any other representations or warranties relate to Manufacturing and
not
expressly made in this Agreement, including, but not limited to paragraphs
9 and
10, of this Agreement, are deemed by the Parties as not having been made or
to
the extent permissible by the Act are expressly disclaimed.
10. Payment
and Shipping of Product to MDI
11. Consideration.
11.1 Fee.
Eucodis
shall pay to MDI an upfront fee of Eight Hundred Seven Thousand One Hundred
Seventy-Five Untied States Dollars ($807,175) payable as follows:
(a) Three
hundred eighty two thousand, one hundred seventy five US dollars ($382,175.00)
upon execution of this Agreement; and
(b) Two
hundred twenty five thousand US dollars ($225,000.00) on September 30, 2006;
and
(c) Two
hundred thousand US dollars ($200,000.00) on February 28, 2007.
These
payments are exclusive of any payments set forth in Section 6
herein.
11.2 Milestone
Payments.
Milestone payments shall be made at set performance and date targets. Should
the
German court issue an order, as a result of litigation undertaken by MDI,
lifting the cloud upon the ability of MDI to file and have accepted assignments
of the Products patents in the EU and such assignment is accepted by the German
and Austrian patent agencies, prior to the completion of the Phase II clinical
trials, then Eucodis shall owe a payment of Euro 500,000 to MDI. Upon completion
of the Phase II clinical trials in the Eucodis Territory or on March 30, 2008
which ever is earlier in time, Eucodis shall owe and pay MDI Euro 750,000.
However if the cloud upon the Products patent has not yet been lifted or
otherwise cleared by any means and assignment has not been accepted by the
German and Austrian patent agencies, then the Euro 750,000 shall not yet be
owed
and due regardless of the date. However, regardless of the status of the cloud
upon the Product’s patent, should Eucodis have received revenue of any kind from
or as a result of the Product then MDI shall be entitled to, and Eucodis shall
pay to MDI, fifty percent (50%) of the Eucodis revenues until the Euro 750,000
has been paid to MDI.
11.3 Recovery
of Costs.
In the
event MDI is unable to secure an order form the German court where the
litigation concerning the ownership of the Product’s patent is pending, by the
end of the Phase II clinical trials and the Parties have not identified a
licensor in the EU and the Parties both agree not to move forward with a Phase
III clinical trial in the Eucodis Territory, or six months after the completion
of Phase III should the Parties have agreed to move forward with these Phase
III
clinical trials, then MDI shall grant to Eucodis fifty percent (50%) of MDI
Net
Revenues on the Product in the US market capped at $8.3 million US dollars.
Once
Eucodis has received this amount in payment, then Eucodis shall continue to
receive twenty five percent (25%) of the US market Net Revenues up to an
including an additional $8.0 million US dollars. However the entire amount
of
$16.3 million US dollars provided for under this paragraph 12.3 must be paid
within two years of the date of the first dollar of Net Revenue is received
by
MDI from the US market. Should MDI fail to pursue the United States market
itself or otherwise obtain a license from a third party for the US market,
then
MDI shall provide written notice of its nonpursuit to Eucodis and Eucodis shall
then be given the right, subject to the global license provisions herein, to
pursue and develop the US market. Any Net Revenues received by Eucodis as a
result of this US market development shall belong solely to Eucodis until such
time that Eucodis has received 16.3 million US dollars from the US market.
Thereafter Eucodis’ license to the US market shall revert to MDI however,
Eucodis shall be entitled to twelve and one half percent of the Net Revenues
of
the US market for period of five years after the license reversion to MDI.
11.3.1 In
addition, should the events set forth in 11.3 herein occur, the Agreement shall
terminate with all Intellectual Property, related data and other rights
reverting back to MDI.
11.3.2 Eucodis
agrees that at any time MDI may ask for an accounting of Eucodis’ costs which
shall be done by Eucodis in accordance with US GAAP. Should Parties enter into
Phase III clinical trials, this right to audit becomes reciprocal.
12. Steering
Committee.
MDI and
Eucodis shall form a Steering Committee of five (5) members. Each Party shall
name two individuals to the Steering Committee of their own choosing and the
fifth member shall be mutually agreeable to both Parties. Each Party shall
bear
the cost of the two members it each names and the cost of the fifth member
will
be shared equally between the Parties. The fifth member shall serve a term
of
one year which the Parties can unanimously agree to extend to additional one
year terms. The Steering Committee shall meet once a quarter and shall address
any and all development and manufacturing issues which arise during the term
of
the Agreement.. The Steering Committee shall have the authority to generally
guide, plan , monitor and, if needed, direct the Clinical Development Plan,
settle disagreements between the Parties, monitoring the patent filing strategy
in the Territory.
13. Indemnification
13.1 Eucodis
Indemnification of MDI.
Eucodis
shall indemnify, defend and hold MDI, each Affiliate of MDI and the officers,
employees, and agents thereof (each an “MDI indemnified party”) harmless from
and against any and all losses, liabilities, damages, claims, expenses, suits,
recoveries, judgments and fines (including reasonable attorneys' fees and
expenses) (collectively, “Losses”) that may be incurred by any MDI indemnified
party arising out of any (i) damage to property or injury or death occurring
to
any person arising out of possession, use or consumption by any person of the
Product to the extent that such damage, injury or death was caused by the
failure of such Product to meet Specifications, including the contamination
or
adulteration of the Product while in the control of Eucodis; (ii) injury to
person or property or death occurring to any Eucodis employees, subcontractors,
agents or any individuals on Eucodis's premises; (iii) claim, action or
proceeding brought by any governmental or regulatory authority arising out
of or
resulting from any manufacture, packaging or supply of Product by Eucodis which
is not in accordance with this Agreement; (iv) breach by Eucodis of any of
its
obligations, representations or warranties under this Agreement, including
a
breach which results in a Recall of Product to the extent that Eucodis is
responsible for such Recall under Section 11.7, or (v) any other willfully
negligent or wanton act of omission or commission on the part of
Eucodis.
13.2 MDI's
Indemnification of Eucodis.
MDI
shall indemnify, defend and hold Eucodis, each Affiliate of Eucodis and the
officers, directors and employees thereof (each a “Eucodis indemnified party”)
harmless from and against any and all Losses that may be incurred by any Eucodis
indemnified party arising out of any (i) damage to property or injury or death
occurring to any person arising out of possession, use or consumption by any
person of the Product to the extent that such damage, injury or death was caused
by the contamination or adulteration of the Product while in the control of
MDI
or by any defective Specification furnished by MDI or (ii) injury to person
or
property or death occurring to any MDI employees, subcontractors, agents or
any
individuals on MDIs's premises or caused by the presence of MDI’s employees or
agents at the Facility; (iii) claim that the manufacture of the Product by
Eucodis under this Agreement infringes the intellectual property rights of
any
other Person by reason of the use of any intellectual property rights owned
by
MDI; (iv) breach by MDI of any of its obligations, representations or warranties
under this Agreement, including a breach which results in a Recall of Product
or
(v) any other willfully negligent or wanton act of omission or commission on
the
part of MDI.
13.3 Procedures.
Any
Person that may be entitled to indemnification under this Agreement (an
“Indemnified Party”) shall give written notice to the Person obligated to
indemnify it (an “Indemnifying Party”) with reasonable promptness upon becoming
aware of any claim or other facts upon which a claim for indemnification will
or
is reasonably likely to be based; the notice shall set forth such information
with respect thereto as is then reasonably available to the Indemnified Party.
The Indemnifying Party shall have the right to undertake the defense of any
such
claim asserted by a third party with counsel reasonably satisfactory to the
Indemnified Party and the Indemnified Party shall cooperate in such defense
and
make available all records, materials and witnesses reasonably requested by
the
Indemnifying Party in connection therewith at the Indemnifying Party’s expense.
If the Indemnifying Party shall have assumed the defense of the claim with
counsel reasonably satisfactory to the Indemnified Party, the Indemnifying
Party
shall not be liable to the Indemnified Party for any legal or other expenses
(other than for reasonable costs of investigation) subsequently incurred by
the
Indemnified Party in connection with the defense thereof. The Indemnifying
Party
shall not be liable for any claim settled without its consent, which consent
shall not be unreasonably withheld or delayed. The Indemnifying Party shall
obtain the written consent of the Indemnified Party prior to ceasing to defend,
settling or otherwise disposing of any claim. In no event shall the indemnifying
Party without notice to the other Party, institute, settle or otherwise resolve
any claim or potential claim, action or proceeding.
13.4 Survival.
The
indemnification obligations set forth in this Section 16 shall survive the
expiration or termination of this Agreement.
14. Relationship
of the Parties.
The
relationship between MDI and Eucodis is that of independent contractors and
nothing herein shall be deemed to constitute the relationship of partners,
joint
venturers, nor of principal and agent between MDI and Eucodis. Neither party
shall have any express or implied right or authority to assume or create any
obligations on behalf of or in the name of the other party or to bind the other
party to any contract, agreement or undertaking with any third party. Except
as
otherwise contemplated or permitted by the Agreement, all persons employed
by
Eucodis in connection with the manufacturing, packaging and supply of the
Product to MDI shall be employees or agents of Eucodis and under no
circumstances shall Eucodis or any of its employees or agents be deemed to
be
employees or agents of MDI.
15. Term;
Termination.
15.1 Initial
Term; Term.
Agreement is effective upon execution and its initial term shall commence on
the
28th
day of
July, 2006 and shall continue as set forth in Paragraph 4.2 of this Agreement.
After
the
Initial Term, the Parties may renew this Agreement for continuous additional
Renewal Term(s) of one (1) year unless either Party shall have given written
notice of termination to the other Party not less than six (6) months prior
to
the expiration of the Initial Term, or any Renewal Term.
15.2
Termination.
(a)
Either Party may terminate this Agreement at any time during the Term by written
notice to the other Party if:
(i) the
other
Party shall suspend or discontinue its business operations or make any
assignment for the benefit of its creditors or commence voluntary proceedings
for liquidation in bankruptcy, or admit in writing its inability to pay its
debts generally as they become due, or consent to the appointment of a receiver,
trustee or liquidator of the other Party or of all or any part of its property,
or if there is an execution sale of a material portion of its
assets;
(ii) involuntary
bankruptcy or reorganization proceedings are commenced against the other party
or any of its properties or if a receiver or trustee is appointed for the other
Party or any of its properties and such proceedings are not discharged within
thirty (30) days;
(iii)
the
other Party files or consents to the filing of a petition for reorganization
or
arrangement under any applicable bankruptcy law; or
(iv) the
other
Party fails to comply with any material term of this Agreement or breaches
any
representation or warranty herein and fails to cure such noncompliance or
breaches expressly provided for herein or within sixty (60) days (or within
ten
(10) days in the case of a payment default).
Should
either Party’s failure to cure continue for a period of more than sixty (60)
days (or within ten (10) calendar days in the case of a payment default), the
nonbreaching Party may suspend or terminate its services or obligations under
this Agreement without being in breach or default of its obligations
hereunder.
(b)
Termination of this Agreement, however, shall not affect any obligation to
pay
money, indemnify, reimburse, maintain confidentiality or otherwise which either
Party hereto may have incurred during the Term hereof.
(c)
Should
this Agreement be terminated due to the reasons set forth in Section 15.2 (i),
(ii) or(iii) on MDI’s side, Eucodis shall have the exclusive, fully paid-up
license to continue to
develop,
manufacture and commercialize the Intellectual Property of the Product in the
Eucodis Territory for use in the Field with the right to outlicense after
completion of Phase II, without
financial obligation to MDI.
16. Force
Majeure.
Performance
under this Agreement (other than payments required to be made by either Party)
shall be excused to the extent prevented or delayed by fire, flood, explosion,
unavoidable widespread product tampering by third parties, war, shortages or
unavailability of materials, any act of God, or by any other similar
circumstances of any character reasonably beyond the control of the party so
excused. The Party affected shall promptly notify in writing the non-affected
Party of the event of force majeure and the probable duration of the delay.
Any
delay caused by an event of force majeure shall toll the term of this Agreement
which shall be extended by the length thereof. In the event a force majeure
prevents performance by one party for more than two (2) months, the other Party
shall have the right to terminate this Agreement.
17. Miscellaneous.
17.1 Notice.
All
notices, requests, demands or other communications to or upon the respective
Parties hereto shall be deemed to have been given or made when deposited in
the
mails, registered mail or certified, return receipt requested, postage prepaid,
or overnight courier or by facsimile transmission, the receipt of which is
confirmed by telephone, addressed to the respective party at the following
address (or to such other person or address as is specified elsewhere in this
Agreement for specific purposes):
If
to
EUCODIS:
Eucodis
Forschungs - und Entwicklungs GmbH
Brunner
Str. 59, 1235
1230,
Vienna, Austria
Attention:
Wolfgang Schoenfeld, M.D.
| If
to MDI: |
MDI
Oncology, Inc.
|
1338
S.
Foothill Drive # 266
Salt
Lake
City, Utah 84108
Attention:
Judy M. Robinett
| With
a copy to: |
Epstein
Becker & Green, P.C.
|
150
N.
Michigan Avenue, 35th
Floor
Chicago,
IL 60601
Attention:
Diane Romza-Kutz, Esq.
Facsimile
Number: 312-827-9542
The
above
addresses for receipt of notice may be changed by either Party by notice, given
as provided herein.
18.2. Entire
Agreement.
This
Agreement contains the entire understanding of the Parties, superseding in
all
respects any and all prior oral or written agreements or understandings
pertaining to the subject matter hereof. This Agreement can be amended, modified
or supplemented only by an agreement in writing which is signed by all the
Parties hereto.
18.3. Incorporation
of Exhibits and Schedules.
The
Exhibits and Schedules attached to this Agreement are incorporated herein and
are hereby made a part of this Agreement.
18.4. Severability.
If and
to the extent that any court of competent jurisdiction holds any provision
or
part of this Agreement to be invalid or unenforceable, such holding shall in
no
way affect the validity of the remainder of this Agreement.
18.5 Successors
and Assigns.
This
Agreement shall inure to the benefit of and be binding upon the successors
and
permitted assigns of the Parties; provided, however, that if at any time during
the Term of this Agreement Eucodis is acquired by or becomes an affiliated
company of a competitor of MDI having a competitive product in the Field, then
MDI may terminate this Agreement at any time upon not less than fifteen (15)
days' written notice, provided, further, that promptly upon such termination,
MDI shall compensate Eucodis for any uncancellable obligations and all
in-process material costs and finished Product.
18.6 Assignment.
Neither
Party shall, without the prior written consent of the other Party, delegate,
transfer, convey, assign or pledge any of its rights or obligations under this
Agreement to any other person, firm or corporation, except that (i) MDI may
assign this Agreement, in whole or in part, with respect to any Product which
business is sold, transferred or assigned to a third party without the prior
written consent of Eucodis and (ii) either Party may assign this Agreement,
including all of its rights and obligations hereunder, to any Person or any
Affiliate of such Person in connection with a transaction whereby such Person
or
any Affiliate of such Person acquires control of such party. Any assignee,
whether consent to such assignee has been granted or whether no such consent
is
required under the terms of this Agreement, must agree to be bound by the
obligations and duties of the assigning Party as set forth in this Agreement.
Should any right, title, or interest in the ownership or sale of the Product
change, this Agreement is intended to bind all successor(s) in interest to
the
assigning company as same relates to the Product. Prior to the change,
modification, or transfer of any such right, title or interest in the Product,
the assigning company shall notify all such successor(s) in interest in writing
that such successor(s) will be bound by this Agreement.
18.7. Waiver.
A
waiver by either party of any of the terms and conditions of this Agreement
in
any instance shall not be deemed or construed to be a waiver of such term or
condition for the future.
18.8. Headings.
Headings in this Agreement are included for ease of reference only and have
no
legal effect.
18.9. Counterparts.
This
Agreement may be executed in two or more counterparts, each of which shall
be
deemed an original and all of which together shall constitute one and the same
instrument.
18.10. Applicable
Law.
This
Agreement is governed by and shall be construed in accordance with the laws
of
the State of Utah , United States of America, regardless of any conflicts of
laws provisions. Any disputes under this Agreement shall be subject to
arbitration under the Rules of Arbitration of the International Chamber of
Commerce. The arbitration shall take place in Frankfurt Germany with three
arbitrators two of which must have significant experience in the
biotech/pharmaceutical licensing area. The language of the arbitration
proceedings shall be conducted in English.
18.11. Press
Release.
The
Parties shall have the right to issue press releases relating to its entry
into
this Agreement and the reporting of any and all progress made in the development
of the Product in the Field for the Eucodis Territory, provided that prior
to
release, the releasing Party provides the other Party with a draft of the press
release in sufficient time for the nonreleasing Party to comment on the release.
At no time shall Eucodis issue a release which places MDI at risk with any
Governmental Authority as such relates to its public company position.
In
Witness Whereof, the parties have caused this Agreement to be duly executed
in
their respective names and on their behalf, as of the date first above
written.
| |
EUCODIS
FORSCHUNGS-UND
|
| |
ENTWICKLUNGS
GmbH
|
| |
|
| |
|
| |
By:
/S/ EUCODIS
FORSCHUNGS-UND
|
| |
ENTWICKLUNGS
GmbH
|
| |
Title:
_________________________
|
| |
|
| |
|
| |
MDI
ONCOLOGY, INC.
|
| |
|
| |
|
| |
By:/S/
MDI ONCOLOGY, INC.
|
| |
Title:
_________________________
|
EXHIBIT
A
CLINICAL
DEVELOPMENT PLAN
EXHIBIT
B
EU
MARKET DATA SUPPLIED BY EUCODIS
EXHIBIT
C
WORK
COMMISSIONED BY THE BANKRUPT COMPANY AND OBTAINED BY
EUCODIS
EXHIBIT
D
THE
COUNTRIES INCLUDED IN EUCODIS TERRITORY, IN ADDITION TO THE TERRITORY COVERED
IN
1.8