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EXHIBIT 10.23
COLLATERAL ASSIGNMENT OF LICENSE AGREEMENT
THIS COLLATERAL ASSIGNMENT OF LICENSE AGREEMENT dated as of December
6, 1996, executed and delivered by ZYNAXIS VACCINE TECHNOLOGIES, INC., a
Pennsylvania corporation (the "Debtor"), in favor of CYTRX CORPORATION, a
Delaware corporation (the "Secured Party").
WHEREAS, the Secured Party is extending a secured loan (the "Secured
Loan") to Zynaxis, Inc., a Pennsylvania corporation and the Debtor's parent
("Zynaxis"), which Secured Loan will be guaranteed by the Debtor pursuant to
that certain Guaranty dated as of the date hereof (the "Guaranty");
WHEREAS, the Debtor is party to a certain License Agreement dated July
1, 1987 (as amended, supplemented, restated or otherwise modified from time to
time, the "Assigned Agreement") with Southern Research Institute ("Southern"),
pursuant to which the Debtor licenses certain technology from Southern; and
WHEREAS, as a condition to the Secured Party extending the Secured
Loan to Zynaxis, the Secured Party has required, among other things, that the
Debtor execute and deliver the Guaranty and, in connection therewith, assign to
the Secured Party, and grant to the Secured Party a security interest in, the
Debtor's right, title and interest in, to and under the Assigned Agreement, as
additional security for the Guaranteed Obligations.
NOW, THEREFORE, in consideration of the premises set forth herein and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged by the Debtor, the Debtor agrees as follows:
SECTION 1. ASSIGNMENT AND SECURITY INTEREST. As security for the
payment and performance of the Guaranteed Obligations, the Debtor hereby
assigns to the Secured Party, and grants to the Secured Party a security
interest in (a) all of the Debtor's right, title and interest in, to and under
the Assigned Agreement, together with all other documents, instruments,
agreements, certificates and opinions delivered in connection with the Assigned
Agreement, all as the same may be amended, supplemented, restated or otherwise
modified from time to time, (the "Assigned Agreement Documents"), including
without limitation, (i) all rights of the Debtor to receive moneys due and to
become due to it thereunder or in connection therewith; (ii) all rights of the
Debtor to damages arising out of, or for, breach or default in respect thereof
and (iii) all rights of the Debtor to perform and exercise all rights and
remedies thereunder; (b) all of the Debtor's books and records in any way
relating to the Assigned Agreement Documents and (c) all products and proceeds
of any of the foregoing (all of the foregoing, collectively the "Collateral").
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SECTION 2. COVENANTS. The Debtor covenants and agrees as to each
Assigned Agreement Document as follows:
(a) The Debtor shall at all times duly and punctually perform all
of the terms, conditions and covenants of the Assigned Agreement Documents on
the Debtor's part to be kept, observed and performed.
(b) The Debtor will not sell, assign, ▇▇▇▇▇ ▇ ▇▇▇▇ in, or
otherwise transfer to any Person any of the Debtor's right, title or interest
in, to or under any of the Collateral.
(c) The Debtor will not amend or otherwise modify any of the terms
of any Assigned Agreement Document, or terminate any Assigned Agreement
Document, without the Secured Party's prior written consent.
(d) The Debtor shall promptly deliver to the Secured Party a copy
of any notice or other written communication given by Southern to the Debtor or
by the Debtor to Southern under or in connection with any Assigned Agreement
Document.
SECTION 3. REPRESENTATIONS AND WARRANTIES. The Debtor represents and
warrants to the Secured Party as follows:
(a) True, correct and complete copies of the Assigned Agreement
Documents (including all amendments, supplements and modifications thereto)
have been delivered to the Secured Party.
(b) Each Assigned Agreement Document is in full force and effect
and is the legal, valid and binding obligation of the Debtor and Southern,
enforceable against the Debtor and Southern in accordance with its terms.
(c) With the exception of the Debtor's failure to pay royalties as
described in letters from Southern to Debtor dated August 21, 1996 and August
27, 1996 (the "Royalty Default"), neither the Debtor nor Southern is in default
under any Assigned Agreement Document.
(d) Except for that certain Development and License Agreement by
and between Zynaxis and ALK A/S dated September 21, 1995, the Debtor has not
assigned any of its right, title or interest in, to or under any of the
Collateral to any Person.
(e) The Debtor has full authority and the legal right to assign to
the Secured Party, and to grant to the Secured Party a security interest in,
the Assigned Agreement Documents and the other Collateral and the Debtor has
obtained all consents necessary for the valid and binding assignment of and the
effectiveness and enforceability of such security interest under this
Agreement.
(f) All of the Collateral is free and clear of all Liens.
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SECTION 4. DEBTOR'S RIGHT TO ENFORCE. So long as no Event of Default
shall have occurred, the Secured Party will not exercise or enforce, or seek to
exercise or enforce, or avail itself of, any of the rights, powers, privileges,
authorizations and benefits assigned and transferred to the Secured Party
pursuant to this Agreement, and the Debtor may exercise or enforce, or seek to
exercise or enforce, such rights, powers, privileges, authorizations and
benefits in conformity with the provisions of this Agreement. If the Debtor
shall fail to perform or comply with any term or condition imposed upon the
Debtor under any of the Assigned Agreement Documents, or the Debtor shall fail
to exercise any right or remedy of the Debtor thereunder, then, without waiving
or releasing the Debtor from any of its obligations hereunder or under such
Assigned Agreement Document, the Secured Party may (but shall not obligated to)
take any action the Secured Party deems necessary or desirable to preserve and
protect any of the Debtor's rights thereunder or the Secured Party's rights
thereunder; provided, however, that the Secured Party may not take any such
action if the Debtor complies with the covenant in Section 8.10 of the
Agreement and Plan of Merger and Contribution dated the date hereof to which
the Debtor and the Secured Party are parties.
SECTION 5. REMEDIES. Upon the occurrence of an Event of Default, the
Secured Party shall, at its election, without notice of election and without
demand, have the right to do any one or more of the following acts, all of
which are hereby authorized by the Debtor: (a) exercise any or all of the
rights available to a secured party under the Uniform Commercial Code or any
other Applicable Law; (b) exercise any or all of its rights and remedies under
the Loan Documents; and (c) through Vaxcel, Inc., a Delaware corporation and a
Subsidiary of the Secured Party, exercise any or all of the Debtor's rights
under any or all of the Assigned Agreement Documents to the exclusion of the
Debtor.
SECTION 6. SECURED PARTY NOT OBLIGATED. Notwithstanding any other
provision of this Agreement to the contrary, the Debtor expressly acknowledges
and agrees that it shall continue to observe and perform all of the conditions
and obligations contained in the Assigned Agreement Documents to be observed
and performed by it, and that neither this Agreement, nor any action taken
pursuant hereto, shall cause the Secured Party to be under any obligation or
liability in any respect whatsoever to any party to any Assigned Agreement
Document or to any other Person for the observance or performance of any of the
representations, warranties, conditions, covenants, agreements or terms therein
contained.
SECTION 7. FURTHER ASSURANCES. At any time and from time to time,
upon the written request of the Secured Party, and at the sole expense of the
Debtor, the Debtor will promptly execute and deliver such further instruments
and documents and take such further action as the Secured Party may reasonably
request for the purpose of obtaining or preserving the full benefits of this
Agreement and of the rights and powers herein granted.
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SECTION 8. RIGHTS CUMULATIVE. The rights and remedies of the Secured
Party under this Agreement are cumulative and not exclusive of any rights or
remedies which it would otherwise have. In exercising its rights and remedies
the Secured Party may be selective and no failure or delay by the Secured Party
in exercising any right shall operate as a waiver of it, nor shall any single
or partial exercise of any power or right preclude its other or further
exercise or the exercise of any other power or right.
SECTION 9. SECURED PARTY APPOINTED ATTORNEY-IN-FACT. The Debtor
hereby irrevocably appoints the Secured Party as the Debtor's attorney-in-fact,
with full power of substitution, effective after the occurrence of an Event of
Default and for so long thereafter as there are unsatisfied Guaranteed
Obligations, with full authority in the place and stead of the Debtor and in
the name of the Debtor or otherwise, from time to time in the Secured Party's
discretion, to take any action and to execute any instrument or document which
the Secured Party may deem necessary or advisable to accomplish the purposes of
this Agreement and to exercise any rights and remedies the Secured Party may
have under this Agreement or Applicable Law. The power-of-attorney granted
hereby is irrevocable and coupled with an interest.
SECTION 10. EXPENSES. The Debtor will pay, on demand, all reasonable
out-of-pocket expenses incurred by the Secured Party or its assignee in
connection with: (a) the collection or enforcement of the Guaranteed
Obligations including the reasonable fees and disbursements of counsel to the
Secured Party, if such collection or enforcement is done through or by an
attorney; and (b) the exercise by the Secured Party or its assignee of any
right or remedy granted to it under this Agreement, if a Default or Event of
Default has occurred.
SECTION 11. AMENDMENTS, ETC. No amendment or waiver of any provision
of this Agreement, nor consent to any departure by the Debtor herefrom, shall
in any event be effective unless the same shall be in writing and signed by the
parties hereto, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given.
SECTION 12. NOTICES. Notices, requests and other communications
required or permitted hereunder shall be given in accordance with the
applicable terms of the Security Agreement of even date herewith between the
Secured Party and the Debtor.
SECTION 13. CONTINUING SECURITY INTEREST. This Agreement shall create
a continuing security interest in the Collateral and shall (i) remain in full
force and effect until indefeasible payment in full of the Guaranteed
Obligations, (ii) be binding upon the Debtor, its successors and assigns and
(iii) inure to the benefit of the Secured Party, and its successors and
assigns. The Debtor's successors and assigns shall include, without
limitation, a receiver, trustee or debtor-in-possession thereof or therefore.
SECTION 14. APPLICABLE LAW; SEVERABILITY. THIS AGREEMENT SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
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THE STATE OF GEORGIA. Whenever possible, each provision of this Agreement
shall be interpreted in such a manner as to be effective and valid under
Applicable Law, but if any provision of this Agreement shall be prohibited by
or invalid under Applicable Law, such provisions shall be ineffective only to
the extent of such prohibition or invalidity, without invalidating the
remainder of such provisions or the remaining provisions of this Agreement.
SECTION 15. INDEMNIFICATION. The Debtor agrees to indemnify and hold
the Secured Party and its officers, directors, employees, agents and Affiliates
harmless from and against any claim, loss, damage, action, cause of action,
liability, cost and expense or suit of any kind or nature whatsoever, including
reasonable attorneys' fees and expenses, brought against or incurred by the
Secured Party or its officers, directors, employees, agents and Affiliates in
any manner arising out of or, directly or indirectly, related to or connected
with this Agreement, including without limitation, the exercise by the Secured
Party or the Secured Party's assignee of any of its rights and remedies under
this Agreement or under any of the Assigned Agreement Documents or any other
action taken by the Secured Party or its assignee pursuant to the terms of this
Agreement; provided, however, that the indemnity set forth in this Section 15
shall not apply to the extent that the claim, loss, damage, action, cause of
action, liability, cost, expense or suit arises primarily and directly from the
gross negligence or willful misconduct of the Secured Party or its assignee.
SECTION 16. COUNTERPARTS. This Agreement may be executed in several
counterparts, each of which shall be an original and all of which, taken
together, shall constitute but one and the same instrument.
SECTION 17. BENEFITS. The terms, covenants and conditions contained
herein shall inure to the benefit of the Secured Party, and its successors and
assigns, and shall be binding on the Debtor and its successors and assigns.
SECTION 18. DEFINITIONS. Capitalized terms not otherwise defined
herein are used herein as with the respective meanings given them in (i) the
Security Agreement of even date herewith between the Debtor and the Secured
Party and (ii) the Senior Secured Note of even date herewith executed by
Zynaxis in favor of the Secured Party, as the case may be.
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IN WITNESS WHEREOF, the Debtor has executed and delivered this
Collateral Assignment of License Agreement under seal as of the date first
written above.
ZYNAXIS VACCINE TECHNOLOGIES, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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Title: Chairman, President and Chief Executive Officer
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ATTEST:
By:
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Title:
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(CORPORATE SEAL)
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ACKNOWLEDGMENT AND AGREEMENT
The undersigned, Southern Research Institute ("Southern"),
acknowledges receipt of a copy of the within and foregoing Collateral
Assignment of License Agreement (the "Assignment"). Capitalized terms not
otherwise defined herein are used herein with the respective meanings given
them in the Assignment.
NOW, THEREFORE, for good and valuable consideration, including the
economic benefit expected to accrue to Southern Research Institute as a result
of the proposed transactions between the Debtor and the Secured Party, the
receipt and sufficiency of which are hereby acknowledged by Southern, Southern
agrees as follows:
Section 1. Consent to Assignment. Southern consents to the execution
and delivery of the Assignment by the Debtor and the assignment by the Debtor
to the Secured Party, and the grant by the Debtor to the Secured Party of a
security interest in, all of the Debtor's right, title and interest in, to and
under the Assigned Agreement Documents and the other Collateral upon
satisfaction of the following conditions:
a. the Collateral is subsequently assigned to Vaxcel, Inc., a
wholly owned subsidiary of the Secured Party; and
b. either Debtor or the Secured Party satisfies the monetary
obligations of the Debtor to Southern under the Assigned
Agreement, including but not limited to: (A) Debtor's
obligation to cure the Royalty Default and (B) Debtor's
obligations to pay expenses of filing, prosecuting, defending
and maintaining patent applications and patents issued
thereon.
Upon receipt by the undersigned of: (i) written notice from the
Secured Party that an Event of Default has occurred under the Secured Loan, and
(ii) proof of satisfaction of the above conditions that is reasonably
satisfactory to the undersigned, the undersigned shall immediately thereupon,
and at all times thereafter, permit the Secured Party, at the Secured Party's
option, to exercise all of the rights and benefits of the Debtor under or in
respect of such Assigned Agreement Documents and the other Collateral which the
Secured Party desires to exercise, all to the complete and absolute exclusion
of the Debtor. The undersigned acknowledges and agrees that any exercise by
the Secured Party of any such rights and benefits shall not discharge or
otherwise release the Debtor from any of its obligations under or in respect of
any of the Assigned Agreement Documents and the other Collateral.
Section 2. Benefits. This Acknowledgment shall be binding upon the
undersigned and its successors and assigns, and shall inure to the benefit of
the Secured Party and its successors and assigns.
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IN WITNESS WHEREOF, the undersigned has executed and delivered this
Acknowledgment and Agreement under seal as of the date first written above.
SOUTHERN RESEARCH INSTITUTE
By: /s/
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Title: President
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