Exhibit 10.4
OPTION AND LICENSE AGREEMENT
BY AND BETWEEN YEUNGNAM UNIVERSITY INDUSTRY
ACADEMIC COOPERATION FOUNDATION
AND
CARDIGANT MEDICAL INC.
DATED AS OF JUN 28, 2010
OPTION AND LICENSE AGREEMENT THIS OPTION AND LICENSE AGREEMENT (hereinafter
referred to as the "Agreement") is made and entered into this 14th day of JUN
2010 (the "Effective Date"), by and between Cardigant Medical Inc, having its
principal place of business at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇
▇.▇.▇. (hereinafter referred to as "Cardigant") and Yeungnam University
Industry-Academic Cooperation Foundation located at 214-1 Dae-dong,
Gyeongsan-si, Gyeongsangbuk-do, 712-749, Korea (hereinafter referred to as
"YU-IACF".
RECITALS
WHEREAS, YU-IACF is the owner of patent 7,273,849
entitled "ProapolipoproteinA-I mutant and pharmaceutical composition comprising
the same for prevention and treatment of atherosclerosis and hyperlipidemia"
and its foreign and continuing counterparts (YU-IACF Technology);
WHEREAS,
Cardigant desires to further develop and clinically validate the YU-IACF
Technology and, if viable, at the option of Cardigant, to acquire a worldwide,
exclusive license in the Field from YU-IACF to Commercialize the YU-IACF in the
Territory on the terms and conditions set forth in this Agreement (the
"Option").
NOW THEREFORE, in consideration of the mutual undertakings
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties, intending to be
legally bound, agree as follows:
ARTICLE 1.0 DEFINITIONS
The following terms, when they appear in this Agreement with an initial capital
letter and without regard to whether they appear in the singular, plural or
possessive form, shall have the meaning defined below:
1.1 "Calendar Quarter". Calendar Quarter means
each of the periods ending on March 31, June 30, September 30 and December 31
of any year.
1.2 "Calendar Year". Calendar Year means each calendar year
during the Term.
1.3 "Cardigant Product". Cardigant Product means any product
that incorporates the YU-IACF Technology or any component thereof or any
improvement thereto.
1.4 "Commercialization" or "Commercialize".
Commercialization or Commercialize means activities directed to obtaining
pricing and reimbursement approvals, marketing, promoting, distributing,
importing or selling a product. For purposes of clarity, Commercialization
shall not include any activities related to Manufacturing or clinical research.
Commercialization is deemed to have occurred when a Cardigant Product is sold
to a non affiliated third party within the Territory for use within the Field.
1.5 "Develop" or "Development". Develop or Development means pre-clinical and
clinical research and drug development activities, including toxicology and
other pre-clinical development efforts, stability testing, process development,
formulation development, delivery system development, quality assurance and
quality control development, statistical analysis, clinical pharmacology, proof
of concept activities, clinical studies (including pre- and post-approval
studies and investigator sponsored clinical studies), regulatory affairs, and
Regulatory Approval and clinical study regulatory activities (excluding
regulatory activities directed to obtaining pricing and reimbursement
approvals). Development excludes Manufacturing
1.6 "Development Plan".
Development Plan means the items set forth on Schedule 1.1, the completion of
which are required prior to Cardigant being able to exercise the Option granted
herein.
1.7 "FDA". FDA means the United States Food and Drug Administration
or any successor agency thereto.
1.8 "Field". Field means the treatment of
vascular diseases and disorders with respect to restenosis and atherosclerosis
arising from the buildup of plaque.
1.9 "First Commercial Sale". First
Commercial Sale means the first bona fide arms length sale of an approved
Cardigant Product to a non-sublicensee third party in any country in the
Territory by Cardigant, its affiliates or sublicensees.
1.15 "Initial Option
Term". The Initial Option Term shall consist of one year from the date of
execution of this Agreement and shall terminate on the same day one year later
regardless of day of the week.
1.10 "Know-How". Know-How means proprietary or
non-public information and materials, whether patentable or not, including (a)
ideas, discoveries, inventions, improvements or trade secrets, (b)
pharmaceutical, chemical and biological materials, products, compositions and
devices, (c) tests, assays, techniques, data, knowledge, methods, procedures,
formulas, or processes, (d) technical, medical, clinical, toxicological and
other scientific data and other information relating to any of the foregoing,
(e) drawings, plans, designs, diagrams, sketches, specifications or other
documents containing or relating to such information or materials, (f) health
and safety information including material safety data sheets, tests, reports,
procedures, processes, models, manuals, formulae, systems, experiments,
samples, specimens, results, statistics, research, and tables of operating
conditions, (g) analytical standards for analysis of the YU-IACF Technology,
(h) quality assurance standards and methods of production, (i) hazard data,
storage requirements and manufacturing records, (j) validation protocols and
reports, (k) safety procedures, manuals and systems, process parameters, and
(l) batch records, taken together for the practice of the art described in the
YU-IACF Technology.
1.11 "Law". Law means all material applicable ordinances,
rules, regulations, laws, guidelines, guidances, requirements and court orders
of any governmental authority.
1.12 "Manufacture" or "Manufacturing".
Manufacture or Manufacturing means activities directed to producing,
manufacturing, processing, packaging, labeling, quality assurance testing and
release, sterilization, shipping or storage of a product.
1.13 "Gross
Sales". Gross Sales means, with respect to any Cardigant Product, the gross
royalties or receipts of Cardigant (or its affiliates) for the sale of
Cardigant Products if manufactured by Cardigant or sold as finished products by
Cardigant or alternatively for product rights if licenses or sublicensed and
compensation to Cardigant takes the form of a royalty or similar payment, as
the case may be, less the following deductions to the extent included in the
gross invoiced sales price for such Cardigant Product or otherwise directly
paid or incurred by such Party, (or its affiliates) with respect to the sale of
such Cardigant Product, and specifically attributable to actual sales of such
Cardigant Product Gross Sales shall be determined from books and records
maintained in accordance with GAAP consistently applied throughout the
organization and across all products of the entity whose sales of Cardigant
Product are giving rise to Gross Sales.
1.14 "Party". Party means either
YU-IACF or Cardigant; "Parties" means both YU-IACF and Cardigant.
1.15
"Patent Maintenance Costs". Patent Maintenance Costs means the costs incident
to the preparation, filing, maintenance, prosecution, and licensing of the
YU-IACF Technology.
1.16 "Sublicensee". Sublicensee means any Third Party
that has been granted a sublicense by Cardigant under the YU-IACF Technology to
Develop, Manufacture or Commercialize a Cardigant Product in the Field.
1.17
"Territory". Territory means the United Stated.
1.18 "Valid Claim". Valid
Claim means any claim from an issued and unexpired patent that has not been
revoked or held unenforceable or invalid by a final decision of a court or
other Governmental Authority of competent jurisdiction, or that has not been
disclaimed, denied or admitted to be invalid or unenforceable through reissue
or disclaimer or otherwise.
1.19 "YU-IACF Technology". YU-IACF Technology
means the patent 7,273,849 entitled "ProapolipoproteinA-I mutant and
pharmaceutical composition comprising the same for prevention and treatment of
atherosclerosis and hyperlipidemia" including, all provisionals, divisionals,
continuations, renewals, continuations-in-part, patents of addition,
re-examination, supplementary protection certificates, extensions,
registrations or confirmation patents, restoration of patent terms, letters of
patent, and reissues thereof and all Know-How necessary to practice the art
described therein.
ARTICLE 2.0 GRANTS OF RIGHTS
2.1 YU-IACF Grants of
Rights. YU-IACF hereby grants to Cardigant for a period of one year from
execution hereto ("Initial Option Term"), and Cardigant accepts an exclusive
royalty-free license in the Territory of the YU-IACF Technology for purposes
of, and to conduct activities under, the Development Plan within the Field.
Cardigant shall have the right to extend the Initial Option Term for an
additional one year period by paying YU-IACF the sum of $100,000 any time prior
to the expiration of the Initial Option Term.
2.2 Prior to the expiration of the Initial Option Term (whether or not
extended) of the Development Plan and upon completion of notification
to YU-IACF in writing of Cardigant"s intent to exercise the Option,
YU-IACF hereby grants to Cardigant, and Cardigant hereby accepts, an
exclusive, royalty-bearing, right and license, of the YU-IACF
Technology, to (i) develop Cardigant Products for use in the Field and in the
Territory, and (ii) manufacture, use, offer for sale, sell, have sold and
import Cardigant Products in the Field and in the Territory and to sublicense
any or all of these rights.
2.3 Rights Retained by the Parties. Any rights of
YU-IACF or Cardigant, as the case may be, not expressly granted to the other
Party under this Agreement shall be retained by such Party. YU-IACF expressly
reserves the right in and to the YU-IACF Technology for the purpose of
conducting academic research including publication by ▇▇. ▇▇▇ (▇▇. ▇▇▇▇▇-▇▇▇▇
▇▇▇) or his lab. Such work shall be for non commercial and education purposes
and no products covered by the YU-IACF Technology shall be sold or offered for
sale.
ARTICLE 3.0 DEVELOPMENT
3.1 General. Cardigant shall use commercially
reasonable efforts to perform the Development Plan in accordance with the
requirements and timelines set forth therein.
ARTICLE 4.0 COMMERCIALIZATION
4.1 General. From and after the Effective Date, and subject to the terms of
this Agreement, including the requirements of this Article 4.0 and successful
exercise of the Option as specified in Section 2.2[PLEASE CONFIRM SECTION
REFERENCES THROUGHOUT AGREEEMENT], Cardigant will be solely responsible for the
Commercialization of Cardigant Products in the Field in the Territory,
including all costs and expenses relating thereto including patent maintenance
costs.
ARTICLE 5.0 FINANCIAL PROVISIONS
5.1 Royalties to YU-IACF. Cardigant shall pay to YU-IACF earned
royalties on the Gross Sales of Cardigant Products sold by or on behalf of
Cardigant, its affiliates or Sublicensees, in accordance with this Section 5.1,
and subject to Section 5.3. (a) For so long as YU-IACF Technology is licensed
by Cardignat on an exclusive basis and a Valid Claim exists, Cardigant shall
pay to YU-IACF an amount equal to three percent (3%) of Gross Sales of
Cardigant Products.
5.2 Upon the first Commercial Sale of Cardigant Products,
Cardigant shall pay to YU-IACF a $200,000 milestone payment in addition to the
royalty payment. Such payment shall be payable to YU-IACF within 60 days of the
event.
5.3 Reports; Payments. Within thirty (30) days after the end of each
Calendar Year during which there are Gross Sales giving rise to a payment
obligation under Section 5.1, Cardigant shall submit to YU-IACF a report
identifying for each Cardigant Product, the Gross Sales for such Cardigant
Product for each country in the Territory for such Calendar Year and the
royalties payable to YU-IACF. Concurrently with each such report, Cardigant
shall pay to YU-IACF all royalties payable by it under Section 5.1 (as the case
may be).
5.4 Books and Records; Audit Rights. Cardigant shall keep complete
and accurate records of the underlying revenue, expense and other relevant data
relating to the calculations of (a) Gross Sales and payments required by
Section 5.1, and (b) the average selling price for the Cardigant Product.
YU-IACF shall have the right, once annually at Cardigant"s expense, to have an
independent, certified public accounting firm, selected by YU-IACF and
reasonably acceptable to Cardigant, review any such records of Cardigant in the
location(s) where such records are maintained by Cardigant upon reasonable
notice (which shall be no less than fourteen (14) days prior notice) and during
regular business hours and under obligations of strict confidence, for the sole
purpose of verifying the basis and accuracy of payments made under Section 5.1
and the ASP for the Cardigant Product within the twenty-four (24) month period
preceding the date of the request for review. The report of such accounting
firm shall be limited to a certificate stating whether any report made, payment
submitted or determination of the ASP for the Cardigant Product by Cardigant
during such period is accurate or inaccurate and the actual amounts of Gross
Sales and royalties due for such period or the actual ASP for the Cardigant
Product during such period (as applicable). Cardigant shall receive a copy of
each such report concurrently with receipt by YU-IACF. Should such inspection
lead to the discovery of a discrepancy to YU-IACF"s detriment, Cardigant shall
pay the amount of the discrepancy with five (5) business days after its receipt
of the accounting firm"s certificate stating the amount of the discrepancy. In
the event YU-IACF wishes to review the foregoing records more than once
annually, YU-IACF shall pay the full cost of the review unless the underpayment
of royalties is greater than ten percent (10%) of the amount due for the
applicable period and in such case Cardigant shall pay the reasonable cost
charged by such accounting firm for such review. Any overpayment of royalties
by Cardigant revealed by an examination shall be fully creditable against
future royalty payments.
5.5 Taxes. Each Party shall pay any and all taxes
levied on account of all payments it receives under this Agreement. If Laws or
regulations require that taxes be withheld, the royalty-paying Party will (a)
deduct those taxes from the remittable payment, (b) timely pay the taxes to the
proper taxing authority, and (c) send proof of payment to the other Party
within thirty (30) days after receipt of confirmation of payment from the
relevant taxing authority. Each Party will reasonably cooperate with the other
Party to obtain the benefit of any applicable tax Law or treaty, including the
pursuit of any refund or credit of such tax to either party.
5.6 United States
Dollars. All dollar ($) amounts specified in this Agreement are United States
dollar amounts.
5.7 Payment Method and Currency Conversion. All payments to
be made by a Party pursuant to this Agreement shall be made in immediately
available funds via either a bank wire transfer, an ACH (automated clearing
house) mechanism, or any other means of electronic funds transfer, at the
paying Party"s election, to the receiving Party"s bank account. For the
purposes of determining the amount of royalties due for the relevant Calendar
Year under Section 5.1, the amount of Gross Sales in any foreign currency shall
be converted into United States dollars in a manner consistent with the
royalty-paying Party"s normal practices used to prepare its financial reports;
provided that such practices use a widely accepted source of published exchange
rates.
5.8 Blocked Payments. If by reason of applicable Laws in any country
in the Territory, it becomes impossible or illegal for a royalty-paying Party,
its Affiliates or Sublicensees to transfer, or have transferred on its behalf
royalties or other payments to the other Party, such royalty-paying Party shall
promptly notify the receiving Party of the conditions preventing such transfer
and such royalties or other payments shall be deposited in local currency in
the relevant country to the credit of the receiving Party in a recognized
banking institution designated by such receiving Party or, if none is
designated by such receiving Party within a period of thirty (30) days, in a
recognized banking institution selected by such royalty-paying Party or its
Affiliate or Sublicensee, as the case may be, and identified in a notice given
to such Party. If so deposited in a foreign country, the royalty-paying Party
shall provide, or cause its Affiliate or Sublicensee to provide, reasonable
cooperation to the receiving Party so as to allow such receiving Party to
assume control over such deposit as promptly as practicable.
5.9 Late
Payments. If a Party shall fail to make a timely payment pursuant to the terms
of this Agreement, interest shall accrue on the past due amount at the lesser
of one percent (1%) of such overdue amount per month or the maximum rate
allowed under applicable Law.
5.10 Inter-Company Sales. Sales of Cardigant
Products between or among Cardigant, its Affiliates shall not cause immediate
payment of royalties under Section 5.1. Royalties shall only be calculated upon
Gross Sales to a Third Party (including a Sublicensee) by Cardigant and its
Affiliates. Cardigant shall keep an accurate record and be responsible for
accounting for and paying royalties on Gross Sales of Cardigant Products to
Third Parties by Cardigant, its Affiliates and Sublicensees.
ARTICLE 6.0 INTELLECTUAL PROPERTY OWNERSHIP, PROTECTION AND RELATED MATTERS
6.1 Ownership of Intellectual Property. (a) Cardigant shall own all
intellectual property discovered, invented or made solely by Cardigant,
its employees, agents or consultants.
6.2 Prosecution and Maintenance of
Patent Rights. (a)Prosecution of YU-IACF Patent Rights. YU-IACF shall have
the right (but not the obligation except during the Initial Option Term) to
prepare, file, prosecute and maintain the YU-IACF Technology. The
out-of-pocket costs and expenses incurred to obtain, prosecute and maintain
the YU-IACF Technology shall be borne one hundred percent (100%) by YU-IACF
during the Initial Option Term.
YU-IACF shall keep Cardigant informed of the status of
all pending patent applications within the YU-IACF Technology. YU-IACF shall
not abandon YU-IACF Technology without at least ninety (90) days" prior written
notice to Cardigant. If YU-IACF decides to abandon any YU-IACF Technology,
Cardigant shall have the option to continue to prosecute and maintain the such
abandoned YU-IACF Technology, in YU-IACF"s name and at Cardigant"s expense.
(b) Notices and Encumbrances. Each of YU-IACF and Cardigant will execute and
file those notices and other filings as shall be reasonably requested by the
other Party from time to time with the United States Patent and Trademark
Office (or any successor agency) or any analogous patent office in the
Territory with respect to the rights granted to such Party under this
Agreement.
6.3 Third Party
Infringement. (a) Notice. Each Party shall promptly report in writing to the
other Party during the Term any known or suspected (i) infringement of any of
the YU-IACF Technology, or (ii) unauthorized use or misappropriation of any of
the YU-IACF Technology of which such Party becomes aware, and shall provide the
other Party with all available evidence supporting such known or suspected
infringement or unauthorized use. (b) Rights to Enforce Infringement Relating
to Cardigant Products in the Field. (i) Subject to Section 6.3(b)(ii), YU-IACF
shall have the first right, but not the obligation, to initiate a suit or take
other appropriate action that it believes is reasonably required to protect
(i.e., prevent or ▇▇▇▇▇ actual or threatened infringement or misappropriation
of) or otherwise enforce the YU-IACF Technology in the Field in the Territory.
Cardigant may initiate a suit or take other appropriate action to protect
YU-IACF Technology only if YU-IACF notifies Cardigant that it does not wish to
initiate a suit or take actions on its own under this Section. Any suit by
Cardigant shall be either in the name of YU-IACF or its Affiliate, the name of
Cardigant or its Affiliate, or jointly by Cardigant, YU-IACF and their
respective Affiliates, as may be required by the Law of the forum. For this
purpose, YU-IACF shall execute such legal papers and cooperate in the
prosecution of such suit as may be reasonably requested by Cardigant; provided
that Cardigant shall promptly reimburse all out-of-pocket expenses (including
reasonable counsel fees and expenses) actually incurred by YU-IACF in
connection with such cooperation. (ii) If Cardigant does not initiate a suit
or take other appropriate action that it has the initial right to initiate or
take pursuant to Section 6.3(b)(i)[ALL SECTIONS MUST BE CROSS REFERENCED
THROUGHOUT THE AGREEMENT], then YU-IACF may, in its discretion, provide
Cardigant with notice of YU-IACF"s intent to initiate a suit or take other
appropriate action. If YU-IACF provides such notice and Cardigant does not
initiate a suit or take such other appropriate action within thirty (30) days
after receipt of such notice from YU-IACF, then YU-IACF shall have the right to
initiate a suit or take other appropriate action that it believes is reasonably
required to protect the YU-IACF Technology. Any suit by YU-IACF shall be
either in the name of YU-IACF or its Affiliate, the name of Cardigant or its
Affiliate, or jointly by Cardigant, YU-IACF and their respective Affiliates, as
may be required by the Law of the forum. For this purpose, Cardigant shall
execute such legal papers and cooperate in the prosecution of such suit as may
be reasonably requested by YU-IACF; provided that YU-IACF shall promptly
reimburse all out-of-pocket expenses (including reasonable counsel fees and
expenses) actually incurred by Cardigant in connection with such cooperation.
(c) Conduct of Certain Actions; Costs. The Party initiating suit shall have
the sole and exclusive right to select counsel for any suit initiated by it
pursuant to Section [7.3(b)] or [7.3(c)]. The initiating Party shall assume
and pay all of its own out-of-pocket costs incurred in connection with any
litigation or proceedings initiated by it pursuant to Sections [7.3(b)] and
[7.3(c)], including the fees and expenses of the counsel selected by it. The
other Party shall have the right to participate and be represented in any such
suit by its own counsel at its own expense. (d) Recoveries. If Cardigant
assumes control over enforcing any infringement claim, YU-IACF shall be
entitled to receive ten percent (10%) of any damages, settlements, accounts of
profits, or other financial compensation recovered by Cardigant from a Third
Party based upon any such infringement claim after deducting Cardigant"s actual
out of pocket expenses (including reasonable counsel fees and expenses)
incurred in pursuing such Infringement Claim, and Cardigant may retain the
balance. If YU-IACF assumes control over enforcing any infringement claim,
Cardigant shall be entitled to receive ten percent (10%) of any damages,
settlements, accounts of profits, or other financial compensation recovered
from a Third Party based upon any such Infringement Claim after deducting
YU-IACF"s actual out of pocket expenses (including reasonable counsel fees
and expenses) incurred in pursuing such Infringement Claim, and YU-IACF may
retain the balance.
6.4 Patent Invalidity Claim. (a) Each Party shall
promptly notify the other Party in the event of any legal or administrative
action by any Third Party against any YU-IACF Technology of which it becomes
aware, including any nullity, revocation, reexamination or compulsory license
proceeding. (b) YU-IACF shall have the first right, but not the obligation, to
defend against any such action involving a YU-IACF Technology, in its own name,
and the costs of any such defense shall be at YU-IACF"s expense. Cardigant,
upon request of YU-IACF, agrees to join in any such action and to cooperate
reasonably with YU-IACF; provided that YU-IACF shall promptly reimburse all
out-of-pocket expenses (including reasonable counsel fees and expenses)
actually incurred by YU-IACF in connection with such cooperation. If YU-IACF
does not defend against any such action involving a YU-IACF Technology, then
Cardigant shall have the right, but not the obligation, to defend such action
and any such defense shall be at Cardigant"s expense. YU-IACF, upon request of
Cardigant, agrees to join in any such action and to cooperate reasonably with
Cardigant; provided that Cardigant shall promptly reimburse all out-of-pocket
expenses (including reasonable counsel fees and expenses) actually incurred by
YU-IACF in connection with such cooperation.
6.5 Patent Marking. Cardigant
shall comply with the patent marking statutes in each country in which the
Cardigant Product is sold by Cardigant, its Affiliates or its Sublicensees.
ARTICLE 7.0 CONFIDENTIAL INFORMATION; PRESS RELEASES
7.1 Treatment of Confidential Information.
During the Term and for five (5) years thereafter, each Party
shall maintain the Confidential Information (as defined in Section 7.2) of the
other Party in confidence, and shall not disclose, divulge or otherwise
communicate such Confidential Information to others (except for those agents,
directors, officers, employees, consultants, subcontractors, licensees,
partners, Affiliates and advisors having a need to know such information
(collectively, "Agents") and who are subject to written obligations of
confidentiality) or use it for any purpose other than in connection with the
conduct of the Development Plan, or the Development, Manufacture or
Commercialization of Cardigant Products pursuant to this Agreement, and each
Party shall exercise reasonable efforts to prevent and restrain the
unauthorized disclosure of such Confidential Information by any of its Agents,
which reasonable efforts shall be at least as diligent as those generally used
by such Party in protecting its own confidential and proprietary information.
Each Party will be responsible for a breach of this Article 7.0 by its Agents.
For clarity, each Party may disclose Confidential Information of the other
Party (a) to Governmental Authorities (i) to the extent desirable to obtain or
maintain Regulatory Approvals for any Cardigant Product within the Territory,
and (ii) in order to respond to inquiries, requests or investigations by
Governmental Authorities; (b) to outside consultants, scientific advisory
boards, managed care organizations, and non-clinical and clinical investigators
to the extent necessary to Develop or Commercialize any Cardigant Product; and
(c) to the extent desirable to obtain or maintain the YU-IACF Technology or to
Develop or Commercialize, any Cardigant Product; provided that YU-IACF and
Cardigant (as the case may be) shall obtain the same confidentiality
obligations from such Third Parties as it obtains with respect to its own
similar types of confidential information.
7.2 Confidential Information.
"Confidential Information" means all trade secrets or other proprietary
information, including any proprietary data and materials (whether or not
patentable or protectable as a trade secret), regarding a Party"s or its
licensor"s technology, products, business, financial status or prospects or
objectives, which is disclosed by a Party to the other Party. All information
disclosed by one Party to the other Party prior to the Effective Date pursuant
to the confidentiality agreements between the Parties (collectively, the
"Confidentiality Agreements"), shall be deemed to be the "Confidential
Information" of such Party. Notwithstanding the foregoing, Confidential
Information shall not include any information that: (a) either before or after
the date of the disclosure to the receiving Party is lawfully disclosed to the
receiving Party by Third Parties without any violation of any obligation to the
other Party; or (b) either before or after the date of the disclosure to the
receiving Party, becomes published or generally known to the public through no
fault or omission on the part of the receiving Party or its Agents; or (c) is
independently developed by or for the receiving Party without reference to or
reliance upon the Confidential Information as demonstrated by contemporaneous
written records of the receiving Party; or (d) is required to be disclosed by
the receiving Party to comply with applicable Laws, to defend or prosecute
litigation or to comply with governmental regulations or the regulations or
requirements of any stock exchange, provided that the receiving Party promptly
provides prior notice of such disclosure to the other Party and uses reasonable
efforts to avoid or minimize the degree of such disclosure.
7.3 Publication Rights. Nothing in this Agreement shall limit or prevent either
Party from publishing any information about the YU-IACF Technology. Thirty (30)
days prior to submission for publication, either Party will use their
reasonable efforts to submit the proposed publication, for review only.
7.4 Publicity. Neither party shall use the name, trade name, trademark or
other designation of the other party in connection with any
products, promotion or advertising without the prior written permission of the
other party.
ARTICLE 8.0 REPRESENTATIONS, WARRANTIES AND COVENANTS
8.1 YU-IACF"s
Representations. YU-IACF hereby represents and warrants as of the Effective
Date as follows: (a) YU-IACF has the corporate power and authority to execute
and deliver this Agreement and to perform its obligations hereunder. The
execution, delivery and performance of this Agreement has been duly and validly
authorized and approved by proper corporate action on the part of YU-IACF.
YU-IACF has taken all other action required by applicable Law, its certificate
of incorporation or by-laws or any agreement to which it is a party or by which
it or its assets are bound, to authorize such execution, delivery and (subject
to obtaining all necessary governmental approvals with respect to the
Development, Manufacture and Commercialization of Cardigant Products)
performance. Assuming due authorization, execution and delivery on the part of
Cardigant, this Agreement constitutes a legal, valid and binding obligation of
YU-IACF, enforceable against YU-IACF in accordance with its terms. (b) The
execution and delivery of this Agreement by YU-IACF and the performance by
YU-IACF contemplated hereunder will not violate (subject to obtaining all
necessary governmental approvals with respect to the Development, Manufacture
and Commercialization of Cardigant Products) to YU-IACF"s knowledge, any Law of
any Governmental Authority. (c) YU-IACF represents and warrants that it is the
exclusive owner of the entire right and title in and to the inventions included
in the YU-IACF Technology or that it has acquired the right to grant exclusive
licenses to the YU-IACF Technology of the scope granted to Cardigant in the
Field provided for in this Agreement.
8.2 Cardigant"s Representations.
Cardigant hereby represents and warrants as of the Effective Date as follows:
(a) Cardigant has the corporate power and authority to execute and deliver this
Agreement and to perform its obligations hereunder. The execution, delivery
and performance of this Agreement has been duly and validly authorized and
approved by proper corporate action on the part of Cardigant. Cardigant has
taken all other action required by Law, its certificate of incorporation or
by-laws or any agreement to which it is a party or by which it or its assets
are bound to authorize such execution, delivery and (subject to obtaining all
necessary governmental approvals with respect to the Development, Manufacture
and Commercialization of Cardigant Products) performance. Assuming due
authorization, execution and delivery on the part of YU-IACF, this Agreement
constitutes a legal, valid and binding obligation of Cardigant, enforceable
against Cardigant in accordance with its terms. (b) The execution and delivery
of this Agreement by Cardigant and the performance by Cardigant contemplated
hereunder will not violate (subject to obtaining all necessary governmental
approvals with respect to the Development, Manufacture and Commercialization of
Cardigant Products), to Cardigant"s knowledge, any Law of any Governmental
Authority.
8.3 YU-IACF Covenants. YU-IACF shall conduct, and shall use
reasonable efforts to cause its contractors and consultants to conduct, all of
its activities contemplated under this Agreement in accordance with all
applicable Laws of the country in which such activities are conducted.
8.4 Cardigant Covenants. Cardigant shall conduct, and shall use reasonable
efforts to cause its contractors and consultants to conduct, all of its
activities contemplated under this Agreement in accordance with all applicable
Laws of the country in which such activities are conducted.
8.5 No Warranty. EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT,
NEITHER PARTY HERETO MAKES ANY REPRESENTATION AND EXTENDS NO WARRANTY OF ANY
KIND, EITHER EXPRESS OR IMPLIED. YU-IACF MAKES NO WARRANTIES AS TO THE
VALIDITY OR SCOPE OF THE YU-IACF TECHNOLOGY, OR THAT ANY MANUFACTURE, SALE,
USE, OR OTHER DISPOSITION OF THE CARDIGANT PRODUCTS WILL BE FREE FROM
INFRINGEMENT OF PATENTS OR OTHER PROPRIETARY RIGHTS OF ANY THIRD PARTY.
ARTICLE 9.0 INDEMNIFICATION
9.1 Cardigant shall indemnify, hold harmless and defend YU-IACF, YU-IACF"s
Affiliates, and all of the respective officers, directors, employees and agents
of each of the foregoing entities (collectively the "YU-IACF Indemnitees") from
and against any and all losses, damages, liabilities, judgments, fines, amounts
paid in settlement, expenses and costs of defense (including reasonable
attorneys" fees and witness fees) (collectively "Losses") resulting from any
demand, claim, action or proceeding brought or initiated by a third party (each
a "Third-Party Claim") against any YU-IACF Indemnitees(s) to the extent that
such Third-Party Claim arises out of (a) the breach or alleged breach of any
representation, warranty or covenant by Cardigant in Article 8.0; (b) the
negligence or willful misconduct of any Cardigant Indemnitee (defined in
Section 9.2); or (c) the research, development, manufacture, storage, handling,
use, sale, offer for sale or importation of Cardigant Products by or for the
Cardigant Indemnitees.
9.2 Indemnification by YU-IACF. YU-IACF shall
indemnify, hold harmless and defend Cardigant, Cardigant"s Affiliates,
Cardigant"s and its Affiliate"s Sublicensees and all of the respective
officers, directors, employees and agents of each of the foregoing entities
(collectively the "Cardigant Indemnitees") from and against any and all Losses
resulting from any Third-Party Claim against them to the extent that such
Third-Party Claim arises out of (a) the breach or alleged breach of any
representation, warranty or covenant by YU-IACF in Article 8.0; (b) the
negligence or willful misconduct of any YU-IACF Indemnitee; (c) the
development, manufacture, storage, handling, use, sale, offer for sale or
importation of Cardigant Products by or for YU-IACF Indemnitees; or (d) the
manufacture, storage, handling or importation of Cardigant Products
manufactured by YU-IACF by or for Cardigant Indemnitees.
9.3 Limitation of
Liability. EXCEPT TO THE EXTENT SUCH PARTY MAY BE REQUIRED TO INDEMNIFY THE
OTHER PARTY UNDER THIS ARTICLE 10.0 OR WITH RESPECT TO CLAIMS REGARDING A
BREACH OF A PARTY"S OBLIGATIONS UNDER SECTION [2.4] OR ARTICLE [7.0], NEITHER
PARTY NOR ITS RESPECTIVE AFFILIATES AND LICENSEES (INCLUDING SUBLICENSEES AND
OTHER LICENSEES) SHALL BE LIABLE FOR SPECIAL, INCIDENTAL, EXEMPLARY,
CONSEQUENTIAL OR PUNITIVE DAMAGES, INCLUDING LOST PROFITS, ARISING OUT OF OR IN
CONNECTION WITH THIS AGREEMENT, WHETHER IN CONTRACT, WARRANTY, TORT (INCLUDING
NEGLIGENCE), STRICT LIABILITY OR OTHERWISE.
ARTICLE 10.0 TERM AND TERMINATION
10.1 Term. The term of this Agreement (the "Term") shall commence on the
Effective Date and, unless earlier terminated as provided in this Article 10.0,
shall continue in full force and effect, on a country-by-country and
product-by-product basis until there is no remaining royalty obligation in such
country with respect to such Cardigant Product, at which time this Agreement
shall expire in its entirety with respect to such Cardigant Product in such
country.
10.2 Termination by YU-IACF. If Cardigant shall at any time be in
material breach of this Agreement, YU-IACF shall have the right to provide
written notice to Cardigant requiring it to cure such breach. If such material
breach is not cured within thirty (30) days after receipt of such notice, then
except as specifically otherwise set forth herein, YU-IACF shall have the right
(without prejudice to any of its other rights conferred on it by this Agreement
or under applicable Law) to terminate this Agreement by giving written notice
to Cardigant, with such termination to take effect immediately. For purposes
of clarity and without limiting the generality of the foregoing, any of the
following shall be a material breach of this Agreement by Cardigant: (a)
Cardigant"s failure to pay any royalty payment when due, in accordance with
Article 5.0, (b) Cardigant"s failure to meet its specific diligence
obligations under Sections 6.2(a) or 6.2(b) or (c) Cardigant"s failure to
complete a phase II trial within four years from the date of Option exercise.
10.3 Termination by Cardigant. If YU-IACF shall at any time be in material
breach of this Agreement, Cardigant shall have the right to provide written
notice to YU-IACF requiring it to cure such breach. If such material breach is
not cured within thirty (30) days after receipt of such notice, then except as
specifically otherwise set forth herein, Cardigant shall have the right
(without prejudice to any of its other rights conferred on it by this Agreement
or under applicable Law) to terminate this Agreement by giving written notice
to the YU-IACF, with such termination to take effect immediately.
10.4 Effect
of Termination and Expiration; Accrued Rights and Obligations. Termination of
this Agreement for any reason shall not release either Party from any liability
that, at the time of such termination, has already accrued or that is
attributable to a period prior to such termination (including payment
obligations accrued prior to the effective date of termination pursuant to
Article 5.0) nor preclude either Party from pursuing any right or remedy it may
have hereunder or at Law or in equity with respect to any breach of this
Agreement. It is understood and agreed that monetary damages may not be a
sufficient remedy for any breach of this Agreement and that the non-breaching
Party may be entitled to seek injunctive relief as a remedy for any such
breach.
10.6 Survival. The rights and obligations set forth in this
Agreement shall extend beyond the Term or termination of this Agreement only to
the extent expressly provided for in this Agreement or to the extent required
to give effect to a termination of this Agreement or the consequences of a
termination of this Agreement as expressly provided for in this Agreement.
10.7 Severability. If any provision of this Agreement is held invalid under
any law applicable to the parties, affiliates or assignees, that provision
shall be considered severable and its invalidity shall not affect the remainder
of this Agreement, which shall continue in full force and effect.
ARTICLE 11.0 ASSIGNMENT
Except in the event of a merger, recapitalization, reorganization or
sale of control of a Party, neither this Agreement nor any right or obligation
hereunder may be assigned or otherwise transferred by either Party without the
prior written consent of the other Party. Any permitted assignee shall remain
jointly and severally liable with respect to all obligations so assigned and
shall acknowledge and confirm in writing that effective as of such assignment
or other transfer, such assignee shall be bound by this Agreement as if it were
the assignor (e.g. YU-IACF or Cardigant, as the case may be) and to the
identical extent applicable to such assignor. Any purported assignment in
violation of this Article 11.0 shall be void.
ARTICLE 12.0 NOTICES All notices, instructions, payments and other
communications hereunder or in connection herewith shall be in writing and
addressed to the respective Parties as follows:
If to Cardigant: Cardigant Medical ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇
Attention: J. Creed
If to YU-IACF: Yeungnam
University Industry-Academic Cooperation Foundation 214-1 Dae-dong,
Gyeongsan-si, Gyeongsangbuk-do, 712-749, Korea Attention: Sung-Ho Park
or such other addresses as may be designated by the respective Party in
writing in accordance with this Article 12.0. Any such notice, instruction,
payment or other communication shall be: (a) delivered personally; (b) sent by
registered or certified mail, return receipt requested, postage prepaid; (c)
sent via a reputable nationwide overnight courier service; or (d) sent by
facsimile transmission. Any such notice, instruction or communication shall be
deemed to have been delivered (i) upon receipt if delivered by hand, (ii) five
(5) business days after it is sent by registered or certified mail, return
receipt requested, postage prepaid or when sent via a reputable nationwide
overnight courier service, or (iii) when transmitted with electronic
confirmation of receipt, if transmitted by facsimile (if such transmission is
on a business day, otherwise, on the next business day following such
transmission).
ARTICLE 13.0 GOVERNING LAW; DISPUTE RESOLUTION; CONSTRUCTION
13.1 Governing Law. This Agreement shall be governed by and construed in
accordance with the Laws of the Republic of Korea not including, however any
conflicts of law rule of Korea which may direct or refer such determination to
the Laws of any other state or country.
13.2 Dispute Resolution.
Any dispute that cannot be settled between the parties shall be exclusively and
finally settled by arbitration in accordance with the Arbitration Rules of the
Korean Commercial Arbitration Board. The arbitration shall be conducted in
Seoul, Korea unless the Parties mutually agree in writing on another location.
The language of the arbitration shall be in English. The Parties undertake to
keep the arbitration proceedings and all information, pleadings, documents,
evidence and all matters relating thereto confidential.
13.3 Construction.
Each Party acknowledges that it has been advised by counsel during the course
of negotiation of this Agreement, and, therefore, that this Agreement shall be
interpreted without regard to any presumption or rule requiring construction
against the Party causing this Agreement to be drafted. Any reference in this
Agreement to an Article, Section, subsection, paragraph, clause or Schedule
shall be deemed to be a reference to any Article, Section, subsection,
paragraph, clause or Schedule of or to, as the case may be, this Agreement.
Except where the context otherwise requires, (a) wherever used, the use of any
gender will be applicable to all genders, (b) any definition of or reference to
any agreement, instrument or other document refers to such agreement,
instrument other document as from time to time amended, supplemented or
otherwise modified (subject to any restrictions on such amendments, supplements
or modifications set forth herein or therein), (c) any reference to any Laws
refers to such Laws as from time to time enacted, repealed or amended, (d) the
words "herein", "hereof" and hereunder", and words of similar import, refer to
this Agreement in its entirety and not to any particular provision hereof, (e)
the words "include", "includes" and "including" shall be deemed to be followed
by the phrase "but not limited to", "without limitation" or words of similar
import; and (f) the word "or" is used in the inclusive sense (and/or). ARTICLE
14.0 MISCELLANEOUS
14.1 Agreement Controls. In the event of a conflict between
the terms set forth in this Agreement and the terms contained in any Purchase
Order or other documentation related to the supply of the YU-IACF Technology or
the subject matter hereof, the terms of this Agreement shall control.
14.2
Waiver. Waiver by a Party of a breach hereunder by the other Party shall not
be construed as a waiver of any succeeding breach of the same or any other
provision. No delay or omission by a Party to exercise or avail itself of any
right, power or privilege that it has or may have hereunder shall operate as a
waiver of any right, power or privilege by such Party. No waiver shall be
effective unless made in writing with specific reference to the relevant
provision(s) of this Agreement and signed by a duly authorized representative
of the Party granting the waiver.
14.3 Entire Agreement. This Agreement
constitutes the entire agreement between the Parties relative to the subject
matter hereof and thereof, and supersede all previous negotiations,
representations, undertakings and agreements both written and oral heretofore
made between the Parties as to such subject matter. Any representation, promise
or condition in connection herewith not specifically incorporated herein or
therein shall not be binding upon either Party.
14.4 Headings. Headings in
this Agreement are for convenience of reference only and shall not be
considered in construing this Agreement.
14.5 Amendment. No modification,
renewal, extension, waiver, cancellation or termination of this Agreement or of
any of the provisions herein contained shall be valid until and unless made in
writing and signed on behalf of the respective Parties by duly authorized
officers thereof.
14.6 Force Majeure. Except for the payment obligations
hereunder, no Party shall be liable for failure of or delay in performing
obligations set forth in this Agreement, and no Party shall be deemed in breach
of its obligations, if such failure or delay is due to a natural disaster,
explosion, fire, flood, tornadoes, thunderstorms, earthquake, war, terrorism,
riots, embargo, losses or shortages of power, labor stoppage, substance or
material shortages, damage to or loss of product in transit, events caused by
reason of Laws of any Governmental Authority, events caused by acts or
omissions of a Third Party, or any other cause reasonably beyond the control of
such Party.
14.7 Third-Party Beneficiaries. None of the provisions of this
Agreement shall be for the benefit of or enforceable by any Third Party other
than an indemnitee under Article 9.0. No such Third Party shall obtain any
right under any provision of this Agreement or shall by reason of any such
provision make any claim in respect of any debt, liability or obligation (or
otherwise) against either Party.
14.8 Relationship of the Parties. Each Party
shall bear its own costs incurred in the performance of its obligations
hereunder without charge or expense to the other, except as expressly provided
in this Agreement. Neither Party shall have any responsibility for the hiring,
termination or compensation of the other Party"s employees or for any employee
compensation or benefits of the other Party"s employees. No employee or
representative of a Party shall have any authority to bind or obligate the
other Party for any sum or in any manner whatsoever, or to create or impose any
contractual or other liability on the other Party without said other Party"s
approval. For all purposes, and notwithstanding any other provision of this
Agreement to the contrary, the legal relationship under this Agreement of each
Party to the other Party shall be that of independent contractor. Nothing in
this Agreement shall be construed to establish a relationship of partners or
joint venturers between the Parties.
14.9 Counterparts. This Agreement may be
executed in any number of counterparts, each of which shall be deemed an
original but all of which together shall constitute one and the same
instrument.
[Remainder of page intentionally left blank.]
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by
their duly authorized representatives as of the Effective Date. Yeungnam
University Industry-Academic Cooperation Foundation
By:/s/ Sung-ok Baek, PhD
Title: President
Cardigant Medical, Inc
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
Title: Chief Executive Officer
Schedule 1.1 Development Plan
1. Company shall perform two preclinical studies for testing the safety of
catheter based delivery of the YU-IACF Technology during the Initial Option
Term. The two studies shall comprise one small animal and one large animal
study (exact animal model, sample size and species to be determined by Company
for each study) for the purpose of evaluating the safety and potential efficacy
of the YU-IACF Technology. Company will be responsible for all costs
associated for carrying out the studies including the manufacture of
recombinant plasmid vectors and protein production.
Schedule 1.2 Excercise Letter
Cardigant Medical, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
June 22, 2011
Via facsimile and Federal Express
Yeungnam University Industry--Academic
Cooperation Foundation
214-1 Dae-dong, Gyeongsan-si
Gyeongsangubk-do 712-749 Korea
Attn: Sung-Ho Park
Re: Option and License Agreement
Dear Mr. Park:
This letter expresses formal notice of exercise of Cardigant Medical, Inc.'s
("Cardigant") right to become a full Licensee in accordance with Section 2.2
of that certain Option and License Agreement by and between Yeungnam University
Industry--Academic Cooperation Foundation and Cadigant Medical, Inc. dated as
of June 28, 2010 (the "Agreement").
Cardigant is hopeful that it will complete its first Commercial Sale in the
not too distant future and will pay the royalty payments required under
Section 5.1 together with the $200,000 required pursuant to Section 5.2 of
the Agreement.
We look forward to many years of a successful and profitable relationship.
If you have any questions, please do not hesitate to contact me.
Sincerely,
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇
President & CEO
Cardigant Medical, Inc.
