EXHIBIT 10.1
*CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED WITH THE SECURITIES AND EXCHANGE COMMISSION
PURSUANT TO RULE 24b-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
AMENDMENT
NO. 1 TO
INTELLECTUAL PROPERTY ASSIGNMENT
AND ASSUMPTION AGREEMENT
This Amendment No. 1, dated as of July 16, 2004, amends that certain
Intellectual Property Assignment and Assumption Agreement (the "Agreement"),
dated August 1, 2002, by and between ▇▇. ▇▇▇▇ ▇▇▇▇▇▇▇ ("▇▇. ▇▇▇▇▇▇▇") and SCOLR,
Inc. (formerly known as Nutraceutix, Inc., "SCOLR").
WHEREAS, ▇▇. ▇▇▇▇▇▇▇ has performed substantial services to improve and
enhance the value of the Intellectual Property;
WHEREAS, ▇▇. ▇▇▇▇▇▇▇ has not received the payment required under Section
4.1 of the Agreement; NOW, THEREFORE
RESOLVED, that, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged by the parties, the parties
agree as follows:
1. Paragraph 4 of the Agreement is amended to read in its
entirety as follows:
"4.1 Assignment Fee. As full compensation for the assignment
and assumption described in Paragraph 1 of the Agreement and fulfillment
of all of ▇▇. ▇▇▇▇▇▇▇'▇ obligations under this Agreement, SCOLR shall pay
▇▇. ▇▇▇▇▇▇▇ (i) Twenty-Five Thousand Dollars ($25,000) promptly upon
execution of this Agreement, and (ii) Twenty-Five Thousand Dollars
($25,000) within five days of the filing of a patent application relating
to the Intellectual Property with the U.S. Patent & Trademark Office
("Patent Application"). The parties hereby represent, warrant and agree
that such payment constitutes full compensation for the assignment and
assumption described in Paragraph 1 of the Agreement and waive any and all
claims that additional or different compensation is due for any reason
except as specifically set forth herein.
4.2 Patent Fee. In the event a United States patent is issued
pursuant to the Patent Application described in Paragraph 4.1, SCOLR shall
pay ▇▇. ▇▇▇▇▇▇▇ Fifty Thousand Dollars ($50,000) promptly upon issuance of
the first such patent.
4.3 Additional Compensation. In consideration of services to
be provided by ▇▇. ▇▇▇▇▇▇▇ pursuant to Paragraph 7 of the Agreement, SCOLR
shall pay ▇▇. ▇▇▇▇▇▇▇ (i) an amount equal to [*] percent ([*%]) of all
Up-Front License Fees (as defined below) received by SCOLR upon licensing
any and all products incorporating the Intellectual Property (each such
resulting product or products a "Covered Use" and collectively the
"Covered Uses"),
and (ii) royalties equal to [*] percent ([*]%) of SCOLR's Net Sales (as
defined below) generated from the Covered Uses. Payments hereunder shall
be made quarterly in arrears, not more than ninety (90) days following the
end of the applicable quarter."
For purposes of this Paragraph 4.3:
"Net Sales" shall mean shall mean the gross receipts by SCOLR
from a Covered Use less deductions for (i) transportation charges,
insurance, sales and excise taxes and duties paid; (ii) normal and
customary trade, quantity and cash discounts allowed, (iii) sale
commissions and (iv) allowances on account of rejection or return by
customers.
"Up-Front License Fees" shall mean shall mean compensation
received by SCOLR upon the grant of a license or licenses for a
Covered Use. Up-Front License Fees shall exclude (i) any royalty,
commission, or other compensation, received by SCOLR or any other
party, which is based upon the number of units sold or revenues
generated from any license or sale of a Covered Use, and (ii) any
payments received by SCOLR for research and development or
feasibility studies with respect to the Intellectual Property, a
Covered Use, or related applications. Further, Up-Front License Fees
and Net Sales shall be reduced by all costs and expenses incurred by
SCOLR in obtaining the Intellectual Property and developing the
Covered Uses, including without limitation, all costs and expenses
associated with research and development, legal, business
development, and travel.
The payment obligations of SCOLR set forth in Paragraph 4.3 shall
terminate upon the earlier of (i) expiration of any corresponding patent
covering the Intellectual Property, (ii) the conclusion of a two year
period during which SCOLR failed to receive any licensing or royalty
revenues for the Covered Uses, or (iii) upon the mutual written agreement
of the parties.
2. Paragraph 6 of the Consulting Agreement dated December 22,
2000, as amended (the "Consulting Agreement") is hereby amended to add the
following to the end of said paragraph:
Without limiting the generality of the foregoing, ▇▇. ▇▇▇▇▇▇▇ hereby
represents, warrants and confirms that (i) the concept for the
Intellectual Property was originated by SCOLR, (ii) he has not
furnished any information regarding the Intellectual Property to any
person or entity other than employees of SCOLR, (iii) to the best of
his knowledge, no person or entity other than SCOLR owns or has
claim to any proprietary or other right in the Intellectual
Property, and (iv) the Intellectual Property constitutes a "SCOLR
Innovation" for all purposes under this Agreement.
3. In light of SCOLR's name change from Nutraceutix, Inc. to
SCOLR, Inc., all references to Nutraceutix in the Agreement, the
Consulting Agreement (and any related Additional Services Agreements or
other amendments thereto), shall be deemed a reference to SCOLR.
4. Except as specifically modified by this Amendment, the
Agreement shall remain in full force and effect.
▇▇. ▇▇▇▇▇▇▇: SCOLR, Inc.
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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▇▇▇▇ ▇▇▇▇▇▇▇, Ph.D. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, President