MUTUAL COOPERATION AND JOINT VENTURE AGREEMENT
THIS MUTUAL COOPERATION AND JOINT VENTURE AGREEMENT is made and entered
into as of March 25, 2002, by and between VIRAL GENETICS, INC., a Delaware
corporation ("Viral Genetics"), and NEW YORK INTERNATIONAL COMMERCE GROUP, INC.,
a Nevada corporation ("NYIC"), hereinafter jointly referred to as the "Parties."
WHEREAS, Viral Genetics has developed and tested (or is currently
developing and testing) various pharmaceutical products related to the treatment
of HIV and/or AIDS, including without limitation that certain TNP product and
TNP-based HIV vaccine (jointly, "TNP") together with any and all variations,
modifications, supplements and later generation versions of TNP as well as any
additional products being and to be developed from TNP related to the treatment
of HIV and/or AIDS only, (collectively herein referred to as the "Products");
WHEREAS, Viral Genetics owns all of the title, interest and rights in
and to each of the Products;
WHEREAS, NYIC has certain affiliations and experience with
administrative and governmental agencies and application procedures in the
People's Republic of China ("PRC") and other Pacific Rim countries, including,
but not limited to, Japan, Korea, Taiwan, Hong Kong, Malaysia, Indonesia,
Singapore and Thailand (the "Territory"), that could prove useful to Viral
Genetics in making application for and obtaining from the appropriate regulatory
agency or agencies in the PRC or other countries in the Territory, including,
without limitation, the State Drug Administration ("SDA") of the PRC
(collectively, the "Regulators") a license for the distribution, marketing and
commercial exploitation of the Products as a "saleable pharmaceutical product"
in such countries (each such license within each country, a "License") and, in
the event an applicable License is obtained, in establishing distribution
channels for the commercial use of such Products in the PRC and elsewhere in the
Territory;
WHEREAS, NYIC has certain affiliations and experience with
administrative, governmental and other agencies and/or corporations in the
People's Republic of China ("PRC"), including, without limitation, the Chinese
National Technology Import-Export Corporation ("CNTIC") that could prove useful
to Viral Genetics in establishing manufacturing capacity in the PRC, whether by
direct financing of a manufacturing or assembly plant or provision of
manufacturing facilities in an existing plant or otherwise;
WHEREAS, the parties agree, upon the terms and conditions set forth
herein, that NYIC and its affiliated companies shall have an exclusive period of
time in which to assist Viral Genetics in obtaining a License initially from the
SDA for the Products in the PRC and then, subject to obtaining such License, to
assist Viral Genetics in obtaining Licenses in other countries throughout the
Territory; and
WHEREAS, it is further contemplated that the parties shall, upon the
general terms and conditions set forth herein, promptly enter into distribution
agreement(s) pursuant to which Viral Genetics shall act as the manufacturer and
grant to NYIC and its affiliated companies the
exclusive rights to market, promote, sell and distribute the Products initially
in the PRC and, subject to the expiration of an exclusive period of time,
thereafter in other countries throughout the Territory upon obtaining the
appropriate regulatory approvals.
NOW, THEREFORE, in consideration of the foregoing premises and the
agreements and the covenants of the parties set forth herein, and other good and
valuable consideration, the receipt and legal adequacy of which is hereby
acknowledged by the parties, NYIC and Viral Genetics hereby agree as follows:
1. Representations and Warranties
a) Authority. Each of NYIC and Viral Genetics represents and warrants
to the other and agrees for the benefit of the other that:
i) it has the power and authority to execute, deliver and perform
this Agreement and is not bound by any contract, agreement or
other commitment, restriction or limitation which would hinder or
in any way restrict such performance;
ii) it has duly authorized the execution, delivery and performance of
this Agreement in accordance with all applicable corporate power
and authority;
iii) no consent from, notice to or filing with any third party is
required in connection with its execution, delivery or
performance of this Agreement, other than consents from various
Regulators as contemplated by this Agreement; and
iv) this Agreement constitute its legal, valid and binding
obligation, enforceable against it in accordance with their
respective terms.
b) No Inconsistent Agreements. Neither Viral Genetics nor any
affiliated individual or entity has entered into, or currently has in effect,
any agreement with respect to the Product or the Intellectual Property Rights
(defined below) that is inconsistent with the rights granted to NYIC in this
Agreement or otherwise conflicts with the provisions of this Agreement.
c) Ownership of the Products and Intellectual Property Rights. Viral
Genetics is the sole and exclusive owner of and has all title, interest and
rights in and to the Products and the related Intellectual Property Rights (as
defined herein) free and clear of any liens or other encumbrances. Set forth on
Appendix A attached hereto is a list of such Intellectual Property Rights,
specifying as to each, as applicable: (i) the nature of the Intellectual
Property Right; (ii) all licenses, sublicenses and other agreements (true,
correct and complete copies of any such licenses, sublicenses or other
agreements are attached to such Schedule) relating in any manner to any
Intellectual Property Right; and (iii) the filing and registration information
with respect to each Intellectual Property Right that is registered with the
United States Patent and Trademark Office, the United States Copyright Office,
any state or foreign jurisdiction or other governmental or regulatory authority.
Viral Genetics' prior and present use of the Intellectual Property Rights has
not and does not infringe or otherwise violate any rights (including, without
limitation, rights of privacy) of any entity or person, and Viral Genetics has
not received a notice of a claim of infringement or knows of any reasonable
basis for a claim that such an infringement or violation exists. No Intellectual
Property Right is subject to any outstanding order, judgment, decree,
stipulation, agreement or understanding, oral or written, restricting or
prohibiting its use by Viral Genetics, as contemplated by this Agreement or
otherwise, or restricting the licensing thereof by Viral Genetics to any
individual or entity. For
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purposes hereof, "Intellectual Property Rights" means all United States of
America and foreign patents, copyrights, trademarks, trade names, brand names,
product names, logos, trade dress; all registrations or applications for
registration of any of the foregoing; and all databases, source and object
codes, computer programs and software in any form or medium, in each case that
are owned by Viral Genetics and/or were, are or may be used in connection with
the Products or held for use or being developed by Viral Genetics or by others
for the benefit of Viral Genetics for use in connection with the Products; and
all trade secrets, methodologies and processes, formulae, research and
development, inventions (whether or not patentable), know-how, technical
information; and other proprietary processes and information of any kind owned
by Viral Genetics and which were, are or may be used in connection with the
Products. Notwithstanding the foregoing or any other statement in this
Agreement, including, without limitation, the entirety of Section 5 herein,
Viral Genetics shall not be required to disclose to NYIC or its affiliates the
proprietary processes related to the manufacture of TNP; provided, however, that
in the event that NYIC or any of its affiliates are required (by oral questions,
deposition, interrogatories, requests for information or documents, subpoena,
civil investigative demand or other similar process) to disclose any material in
their possession with respect to the Intellectual Property Rights (including any
proprietary processes having become known to NYIC or any of its affiliates) by
reason of their relationship with Viral Genetics under this Agreement (the
"Requested Material"), it is agreed that NYIC or such affiliates will provide
Viral Genetics with prompt notice of such request(s), to the extent practicable,
so that Viral Genetics may seek an appropriate protective order and/or waive
compliance by NYIC and its affiliates with any such request. If, failing the
entry of a protective order or the receipt of a waiver hereunder, NYIC or its
affiliates are, in the opinion of counsel to such parties, as the case may be,
compelled to disclose any of the Requested Material under penalty of liability
for contempt or other censure or penalty, NYIC or its affiliates, as the case
may be, may disclose such material (to the extent and only to the extent
necessary to avoid such liability, censure, or penalty) without liability to
Viral Genetics.
d) Product Liability Insurance. Viral Genetics shall, for such time as
this Agreement remains in effect, procure and maintain in full force and effect,
product liability insurance policies covering the Products and their testing,
production, manufacture, distribution and use. Such insurance policy or policies
shall be in such amounts as mutually agreed upon by the parties hereto, shall
name the parties hereto as exclusive loss payees thereunder, shall provide for
at least thirty (30) days prior written notice of the cancellation or
substantial modification thereof and shall include all other insurance required
by the designated insurance consultant or under relevant laws; provided,
however, that it is hereby acknowledged that relevant insurance policies and
coverage may not be available from an insurance company authorized to provide
such policies in the PRC or such other countries located in the Territory to
which the Product is to be distributed and therefore it may become necessary for
Viral Genetics to purchase certain insurance policies from a foreign company if
permitted under the laws of the PRC or such other country, as the case may be.
The incremental cost of any product liability insurance with respect to the
Products and their use in the Territory shall be deducted from Gross Profits (as
a cost of goods sold allocable to the Product) for the calculation of sums
payable to NYIC pursuant to Section 6 (v) of this Agreement.
e) Indemnification. Viral Genetics and NYIC shall, notwithstanding any
termination of this Agreement, indemnify and hold harmless the other party,
together with its affiliates,
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successors and assigns and each of their respective directors, officers,
employees, agents, representatives, stockholders and controlling parties and all
of their successors and assigns (each a "Indemnified Person"), to the fullest
extent permitted by applicable law, from and against any and all losses, claims,
damages, liabilities, costs (including, without limitation, costs of preparation
and attorneys' fees) and expenses (collectively, "Losses"), directly or
indirectly incurred, arising out of or relating to any of the following:
i) any inaccuracy or breach of representation or warranty of such
indemnifying party contained herein or any definitive
distribution agreement entered into by the Parties as
contemplated hereby; or
ii) any breach by such indemnifying party of any agreement, covenant
or obligation contained herein or any definitive distribution
agreement entered into by the Parties as contemplated hereby.
f) Conduct of Indemnification Proceedings. If any proceeding shall be
brought or asserted against any Indemnified Party, such Indemnified Party
promptly shall notify the other party in writing, and the other party shall
assume the defense thereof, including the employment of counsel reasonably
satisfactory to the Indemnified Party and the payment of all fees and expenses
incurred in connection with defense thereof; provided, that the failure of any
Indemnified Party to give such notice shall not relieve the other party of its
obligations or liabilities pursuant to this Agreement, except (and only) to the
extent that it shall be finally determined by a court of competent jurisdiction
(which determination is not subject to appeal or further review) that such
failure shall have proximately and materially adversely prejudiced the other
party. An Indemnified Party shall have the right to employ separate counsel in
any such proceeding and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such Indemnified Party
unless:
i) the other party has agreed in writing to pay such fees and
expenses; or
ii) the other party shall have failed promptly to assume the defense
of such proceeding and to employ counsel reasonably satisfactory
to such Indemnified Party in any such proceeding; or
iii) the named parties to any such proceeding (including any impleaded
parties) include both such Indemnified Party and the other party,
and such Indemnified Party shall have been advised by counsel
that a conflict of interest is likely to exist if the same
counsel were to represent such Indemnified Party and the other
party (in which case, if such Indemnified Party notifies the
other party in writing that it elects to employ separate counsel
at the expense of the other party, the other party shall not have
the right to assume the defense thereof and such counsel shall be
at the expense of the other party).
The other party shall not be liable for any settlement of any such
proceeding effected without its written consent, which consent shall not be
unreasonably withheld. The other party shall not, without the prior written
consent of the Indemnified Party, effect any settlement of any pending
proceeding in respect of which any Indemnified Party is a party, unless such
settlement includes an unconditional release of such Indemnified Party from all
liability on claims that are the subject matter of such proceeding.
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2. Covenants with respect to the PRC.
a) SDA License Application Procedure. Subject to the provisions of this
Section 2(a), Viral Genetics hereby grants NYIC and its affiliated companies the
exclusive right from the date of this Agreement to partner with Viral Genetics
with respect to the submission and filing of an SDA Application for obtaining a
License in the PRC (the "SDA Application"). Viral Genetics shall have the
exclusive and final approval of the form, contents and use of the SDA
Application, as evidenced by Viral Genetics' prior express written consent.
Conditional upon the approval of the SDA Application, as evidenced by the
issuance of a License to Viral Genetics, Viral Genetics shall grant NYIC and its
affiliated companies, for the length of time and upon terms and conditions set
forth in a definitive distribution agreement, the exclusive rights to market,
promote, sell and distribute the Products in the PRC. Until the SDA Application
is submitted on behalf of Viral Genetics, NYIC shall assist and perform such
commercially reasonable activities to facilitate Viral Genetics' submission of
the SDA Application. Any obligations of the Parties hereunder are subject to the
following:
i) Rejection of Application. In the event that the SDA has not
accepted the SDA Application by the first year anniversary
following the submission of the SDA Application, as evidenced by
the lack of issuance of a License to Viral Genetics upon the
first year anniversary following the submission of the SDA
Application, Viral Genetics may, at its option, terminate this
Agreement, rendering this Agreement null and void and without
further effect among the Parties except as otherwise provided in
subparagraph ii) below.
ii) Subsequent Submission of Application. In the event that any time
within a one (1) year period following any rejection by the SDA
of the SDA Application, as defined in Section 2 (a) (i), Viral
Genetics elects to conduct additional human clinical trials and
other testing of the Product as may be necessary to obtain the
approval of the SDA, this Agreement shall be reinstated and Viral
Genetics shall grant NYIC and its affiliated companies (and NYIC
and its affiliated companies shall be entitled to) the exclusive
right to market, promote, sell and distribute the Product in the
PRC upon terms and conditions to be mutually agreed to by the
Parties and set forth in a definitive distribution agreement but
to be of substantially similar tenor to those terms contained in
Section 6 hereof, effective upon the acceptance by the SDA of
Viral Genetics' resubmitted SDA Application, as evidenced by the
issuance of a License to Viral Genetics within the first
anniversary of the submission of the resubmitted SDA Application.
In connection with any such additional clinical testing, NYIC
shall use reasonable efforts to assist Viral Genetics in
procuring from the appropriate regulatory agenc(ies) of the PRC
and provincial governments thereof, including without limitation
the Ministry of Health, the Ministry of State Family Planning
Commission, the People's Liberation Army, the SDA, and others
(the "PRC Regulators") the requisite approval, authorization and
other support including without limitation funding and/or the
provision of laboratory facilities, medical, research or
scientific personnel, provision of treatment space, provision of
human or animal subjects, and the provision of certain testing
services, including without limitation certain types of blood
analysis, for the human clinical trial application process and
execution phase.
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The nature of the clinical trials shall be as determined by Viral
Genetics acting in cooperation with the appropriate PRC
Regulators.
b) Operational Presence. For such time as this Agreement remains in
effect, NYIC shall maintain an office located in the PRC and use its reasonable
efforts to identify and maintain relationships with distributors in all markets
in the Territory customarily doing resale of the Products.
c) Product Personnel and Management. Viral Genetics and any affiliated
companies, as manufacturer, shall at its own cost:
i) employ, on a full-time basis, at least two clinical professionals
to work with the applicable regulatory agencies and departments
of the PRC (including, without limitation, the Minister of
Health, Minister of State Family Planning Commission, and
People's Liberation Army) as identified by NYIC during the course
of this Agreement subject to the terms and provisions of any
definitive distribution agreement with respect to the PRC; and
ii) use its best efforts:
(1)to enlarge and/or supplement its current management and board of
directors to include individuals having relevant experience or
expertise in the manufacture of goods similar to the Products and
the management of manufacturer-distributor relationships in the
PRC, and
(2)to procure sufficient funding and/or financing commitments to
effect its performance under the terms and conditions of this
Agreement.
d) Manufacturing and Final Assembly. NYIC shall, by utilizing its
network of government, military and other contacts, including, without
limitation, the Chinese National Technology Import-Export Corporation ("CNTIC"),
use its reasonable efforts to assist in the procurement of production capacity
in the PRC sufficient to meet demand for the Products in the PRC, said
production capacity to be of GMP quality standards or higher, whether by
arranging debt or equity funding or financing commitments, or arranging
long-term use of production capacity at an existing facility, or by another
mutually-agreeable method. Notwithstanding the foregoing, unless otherwise
agreed to by the Parties, Viral Genetics shall be solely responsible, at its own
cost, for the manufacturing and final assembly and packaging of the Products at
any such facility.
3. Covenants with respect to Licenses elsewhere in the Territory.
Unless this Agreement is earlier terminated, Viral Genetics shall grant
NYIC and its affiliated companies the exclusive rights for three (3) years from
the date of this Agreement to partner with Viral Genetics with respect to the
submission and filing of applications for Licenses in countries other than the
PRC and located in the Territory. To the extent a License is obtained by Viral
Genetics by reason of any such application being submitted within the three (3)
year exclusivity period, Viral Genetics shall grant NYIC and its affiliated
companies, for the length of time and upon terms and conditions set forth in a
definitive distribution agreement, the exclusive rights to market, promote, sell
and distribute the Products in those countries located in the Territory for
which any License was obtained. The terms and
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conditions of any such distribution agreement shall be of substantially similar
tenor to those terms contained in Section 6 hereof. During the three (3) year
exclusive period, NYIC shall assist and perform such commercially reasonable
activities to facilitate Viral Genetics' submission of an application for
obtaining a License in any country other than the PRC and located in the
Territory.
4. Protection of Intellectual Property Rights.
Subject to the terms and conditions of any definitive distribution
agreement, Viral Genetics and NYIC shall at all times use their best efforts to
protect against the infringement of the Products and the related Intellectual
Property Rights by any third party in the PRC and any other Pacific Rim
countries in which the Products are licensed for sale or resale and shall,
either in the name of Viral Genetics, or in the name of NYIC, or in the name of
both NYIC and Viral Genetics, negotiate, settle, initiate legal proceedings or
otherwise take legal action any such infringement. NYIC shall use reasonable
efforts to utilize any network of government, military, regulatory and such
other contacts to further assist Viral Genetics in the protection and
enforcement of the Intellectual Property Rights.
5. Cooperation.
a) In furtherance of accomplishing the purposes of this Agreement,
Viral Genetics shall furnish, or cause to be furnished, such information as
reasonably requested from time to time by the officers, attorneys, accountants
and other authorized representatives of NYIC (collectively, the "NYIC
Representatives") and shall provide access to the records, properties and
personnel of Viral Genetics (including, without limitation, all product data and
information, test results and other such records with respect to the Products).
Viral Genetics shall also cause the officers, employees, accountants,
specialists, consultants and attorneys of Viral Genetics to cooperate with the
NYIC Representatives in connection with their review and examination.
b) Each of the parties hereto agrees to use its commercially reasonable
efforts to promptly take, or cause to be taken, all actions and to do, or cause
to be done, all things necessary, proper or advisable to consummate and make
effective the transactions contemplated by this Agreement.
6. Distributorship Agreement(s).
a) The Parties shall diligently negotiate, in good faith, distribution
agreements, upon mutually agreeable terms and conditions, which definitive
distribution agreement(s) shall become effective upon procuring a License from
the applicable Regulators enabling the marketing, distribution and commercial
exploitation of any of the Products in any applicable country within the
Territory. In addition to the customary representations and warranties and
provisions pertaining to indemnification, allocation of risks and expenses as
well as rights to certain intellectual property, the material terms and
conditions of any definitive distribution agreement shall provide, as follows:
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i) Appointment of NYIC and/or any of its affiliated companies as the
exclusive distributor (the "Distributor") of the Products within
any country located in the Territory for which a License is
obtained pursuant to this Agreement (the "Distribution Country")
in accordance for the term of such distribution agreement;
ii) a ten (10) year term with an option to renew for an additional
ten (10) year term, based on the successful performance under
such distribution agreement of both NYIC (or its affiliated
company, as applicable) and Viral Genetics, the definition of
which shall be mutually agreed to by the parties, including,
without limitation, achieving the minimum sales targets detailed
in Appendix B;
iii) shipment of the Product in bulk form by Viral Genetics, at its
cost, to a mutually-agreeable destination as directed by the
Distributor in writing from time to time located within the PRC
or other Distribution Country, as applicable, unless otherwise
agreed to by the Parties;
iv) the distribution of the Products within the Distribution Country
by Distributor at its cost, and
v) An amount equal to thirty-seven percent (37%) of the Gross Profit
received and collected from the sale of the Products in each
Distribution Country, payable to NYIC. For the purposes of any
definitive distribution agreement, "Gross Profit" would be equal
to:
(1)the sales price charged for the Product by Viral Genetics, which
sales price shall be the greater of:
(a) the price charged by Viral Genetics to Distributor, and
(b) the price charged by Distributor to a third party or parties,
minus
(2)any returns and the base costs of goods sold, as incurred and
directly allocable to the Product, all as set forth in the
financial statements of Viral Genetics prepared in the ordinary
course of business and in accordance with generally accepted
accounting principles (GAAP) as defined in the United States of
America by the Financial Accounting Standards Board, except
applied in a manner consistent with the definition of Gross
Profit set forth above. Determination of Gross Profit and/or the
amount of the resulting fees payable to NYIC and/or its
affiliated companies would be subject to examination and audit by
NYIC and its representatives, or Viral Genetics, as the case may
be, as well as a related dispute mechanism to be set forth in any
definitive distribution agreement.
b) Subject to the terms and conditions of any definitive distribution
agreement between the parties, each of Viral Genetics and NYIC shall use their
best efforts to effect and protect the proper collection of payments directly
associated with sales of Products in the applicable Distribution Country and
repatriate capital to the United States of America or elsewhere. In the event of
any action or omission of action by any governmental, military, or civilian
institution or individual that impedes the collection of payments and/or
repatriation of capital, Viral and NYIC shall, at their joint expense, either in
the name of Viral Genetics, in the name of NYIC, or in the name of both NYIC and
Viral Genetics, negotiate, settle, initiate legal proceedings or otherwise take
legal action any such infringement. NYIC shall use reasonable efforts to utilize
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any network of government, military, regulatory and such other contacts to
further assist Viral Genetics in the facilitation of the collection of payments
and capital repatriation. In the event that the repatriation of capital or
collection of payments is not possible or economically unprofitable following
the reasonable efforts of Viral Genetics and NYIC, and Viral Genetics and NYIC
agree to determine a mutually-agreeable alternative resolution to the voided
obligations, which may include the appointment of a mutually-agreeable,
accredited arbitrator.
c) The parties agree to proceed in good faith with the negotiations and
prompt memorializing of the terms and conditions of a definitive distribution
agreement with respect to the PRC and from time to time thereafter, with respect
to any other Distribution Country for which Viral Genetics submits any
application for a License.
7. Confidentiality and Non-Circumvention.
a) Confidentiality. The Company and Viral Genetics each acknowledge
that from time to time during the Term the Company and Viral Genetics, as
applicable, may gain access to and become acquainted with various trade secrets
and other confidential and proprietary information of the other, including,
without limitation, business strategies, operating plans, financial information,
market analysis, personnel information, reports and data concerning the
Products, product-testing information, Intellectual Property Rights, research
and development, processes, strategic business plans (whether pursued or not),
licenses, pricing and pricing strategy, cost data, sources of contacts and
leads, methods for obtaining new business, know-how, customer lists and
relationships, contact lists and relationships, as well as other methods of
doing and operating the business of each of the Company and Viral Genetics and
any of their respective subsidiaries or affiliates, including entities that are
acquired by the Company or Viral Genetics, their subsidiaries or any of their
affiliates (the "Confidential Information").
b) Non-Disclosure. Absent the express written consent of the other
party hereto or as otherwise expressly permitted under this Agreement, Viral
Genetics and NYIC shall not, for so long as this Agreement remains in effect and
all time thereafter, directly or indirectly, disclose or make available to any
person, corporation, firm, or other entity, or in any manner use for their own
benefit: (i) any Confidential Information or trade secrets relating to the
Products or the business and operations of NYIC or Viral Genetics, as the case
may be; (ii) the contents of this Agreement; (iii) the location, participants or
administrators with respect to any Clinical Trials or (iv) the results of any of
the Clinical Trials. The foregoing restrictions shall not apply to any
Confidential Information which (x) is or becomes generally available to the
public through no action by the party making disclosure; (y) is or becomes
available to the party making disclosure on a non-confidential basis from a
source, who, to the knowledge of the party making disclosure, is not bound to a
confidentiality agreement or similar restriction; or (z) which is disclosed
pursuant to applicable federal, state or local laws or regulations or pursuant
to subpoena or judicial order.
c) Clinical Trial Data. All data generated by any clinical trials
conducted pursuant to this Agreement, including any and all reports, summaries,
written notes, electronic mail, or any other forms of information whatsoever,
shall remain the sole exclusive property of Viral Genetics and Viral Genetics
shall retain complete ownership of any and all patent rights, copyrights,
trademarks, or any other intellectual property rights to TNP, to a TNP-based HIV
9
vaccine, or any products derived therefrom whether during, after, or as a result
of any clinical trials.
d) Non-Circumvention. For the duration of this Agreement and any
definitive distribution agreement to be entered into as part of this Agreement,
neither Viral Genetics nor any successor, permitted assignee or other affiliated
individual or entity (including their respective officers, directors, employees,
attorneys or other agents or representatives) shall, directly or indirectly, (i)
engage or be interested (whether as owner, partner, member, lender, shareholder,
consultant, employee, agent, supplier, distributor or otherwise) in any
business, activity or enterprise which competes with the proposed marketing and
distribution of the Products in any Pacific Rim country as contemplated herein;
(ii) induce or influence any customer, vendor, supplier, distributor, consultant
or any contact, lead or person introduced or otherwise having been identified by
NYIC to Viral Genetics by reason of this Agreement to discontinue or reduce the
extent of its relationship with NYIC or to terminate said relationship; or (iii)
engage, employ or solicit to engage or employ for any other individual or
entity, or otherwise exploit or induce to leave any of the directors, officers
or employees of NYIC or any of the contacts, leads or persons introduced or
otherwise identified by NYIC by reason of this Agreement.
e) Remedies. The parties acknowledge that because the breach or
attempted or threatened breach of any of the provisions of this Section 7 may
result in immediate and irreparable injury to the non-breaching party for which
such party may not have an adequate remedy at law and for which monetary damages
are not readily calculable, such non-breaching party shall be entitled to obtain
injunctive or other equitable relief restraining and prohibiting such breach or
threatened breach, including, without limitation, a temporary and permanent
injunction, enjoining any such breach or attempted or threatened breach (without
being required to post a bond or other security or to show any actual damages).
The right to an injunction and other equitable relief shall be in addition to,
and cumulative with, all other rights and remedies available to the
non-breaching party at law, in equity or otherwise.
f) Severability. The parties acknowledge that, without the provisions
of this Section 7, neither party would enter into this Agreement or consummate
the transactions contemplated hereby. Accordingly, the parties shall be bound by
the provisions hereof to the maximum extent permitted by law, it being the
intent and spirit of the parties that such provisions shall be enforced to the
fullest extent permitted by law. Without limiting the generality of the
foregoing, if any provision of this Section 7 shall be held by any court of
competent jurisdiction or another competent authority to be illegal, invalid or
unenforceable, such provision shall be reformed so that it will be construed and
enforced as if it had been more narrowly drawn so as not to be illegal, invalid
or unenforceable, and such illegality, invalidity or unenforceability shall have
no effect upon and shall not impair the enforceability of any other provision of
this Agreement.
8. Exclusivity.
For the duration of this Agreement and any definitive distribution
agreement to be entered into as part of this Agreement neither Viral Genetics
nor any successor, permitted assignee or other affiliated individual or entity
(including their respective officers, directors, employees, attorneys or other
agents or representatives) shall, directly or indirectly, participate in
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discussions or negotiations with, receive any proposals or offers from, or enter
into any agreement with, any third party, in each case other than NYIC or a
third party consented to by NYIC, that involves the sale, joint venture or the
other disposition of all or any portion of the Products, the business operations
of, or any controlling equity interest in, or any merger, consolidation,
recapitalization or other business combination of any kind involving Viral
Genetics without the condition that such third party assume the obligations of
Viral Genetics under this Agreement as contemplated herein.
9. Termination.
a) This Agreement. This Agreement shall be terminable:
i) immediately and at any time upon the mutual written consent of
the Parties;
ii) by either Party, without further notice, should the other Party:
(1)make a material misrepresentation of fact in this Agreement upon
which the terminating party relies and that has a material
adverse effect on the transactions contemplated by this
Agreement;
(2)commit or be charged with any felony (or equivalent criminal
charge) that has a material adverse effect on the transactions
contemplated by this Agreement or such party's ability to perform
its obligations under this Agreement;
(3)become a defendant in or initiate material litigation that has a
material adverse effect on such party's ability to perform its
obligations under this Agreement; or
(4)fail to comply with various filing, disclosure or reporting
requirements as required from time to time by various
governmental agencies, which failure has a material adverse
effect on the transactions contemplated by this Agreement or such
party's ability to perform its obligations under this Agreement;
or
iii) by Viral Genetics, as provided in Section 2 of this Agreement.
b) Distribution Agreement(s). Any definitive distribution agreement
entered into by the Parties as a result of or in conjunction with this Agreement
may be terminated as provided in the terms and provisions of the applicable
distribution agreement (which termination shall not effect this Agreement or any
other distribution agreements then in effect).
10. Miscellaneous.
a) Press Releases and Public Announcements. No Party shall issue any
press release or make any public announcement relating to the subject matter of
this Agreement without the prior written approval of the other Party; provided,
however, that any Party may make any public disclosure of this Agreement and the
transactions contemplated hereby, if such Party is advised by its legal counsel
that such disclosure is required by applicable law or regulation. The Parties
agree to work cooperatively on the writing and dissemination of any press
releases of public announcements relating to the subject matter of this
Agreement.
b) Marketing and Promotional Materials. NYIC shall obtain the prior,
express written consent of Viral Genetics as to the contents, style and
distribution of any marketing or promotional materials, including, without
limitation, product packaging.
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c) Remedies Cumulative; Invalidity. All remedies, rights, undertakings,
obligations and agreements contained in this Agreement shall be cumulative, and
none of them shall be in limitation of any other remedy, right, undertaking,
obligation or agreement available to either of the parties hereto. The
invalidity, illegality or unenforceability of any term or provision contained in
this Agreement (as determined by a court of competent jurisdiction) shall not
affect the validity, legality of enforceability of any other term or provision
hereof. It is the intent of the parties that this Agreement be enforced to the
fullest extent permitted by applicable law.
d) Waiver; Amendment. No waiver by a party of any breach of any
provision of this Agreement shall be deemed to be a waiver of any preceding or
subsequent breach of the same or similar nature or of any other provision of
this Agreement. Any waiver shall be limited to the specific instance and purpose
for which it is given. Any amendment, modification or waiver of any term or
provision of this Agreement shall only be effective if such amendment,
modification or waiver is evidenced by an instrument in writing duly executed by
each of the parties hereto.
e) Notices. All notices, demands, consents, requests, instructions and
other communications to be given or delivered or permitted under or by reason of
the provisions of this Agreement or in connection with the transactions
contemplated hereby shall be in writing and shall be deemed to be delivered and
received by the intended recipient as follows: (a) if personally delivered, on
the business day of such delivery (as evidenced by the receipt of the personal
delivery service), (b) if mailed certified or registered mail return receipt
requested, four (4) business days after being mailed, (c) if delivered by
overnight courier (with all charges having been prepaid), on the business day of
such delivery (as evidenced by the receipt of the overnight courier service of
recognized standing), or (d) if delivered by facsimile transmission, on the
business day of such delivery if sent by 6:00 p.m. in the time zone of the
recipient, or if sent after that time, on the next succeeding business day (as
evidenced by the printed confirmation of delivery generated by the sending
party's telecopier machine). If any notice, demand, consent, request,
instruction or other communication cannot be delivered because of a changed
address of which no notice was given (in accordance with this Section 10), or
the refusal to accept same, the notice, demand, consent, request, instruction or
other communication shall be deemed received on the second business day the
notice is sent (as evidenced by a sworn affidavit of the sender). All such
notices, demands, consents, requests, instructions and other communications will
be sent to the addresses as first set forth herein. A copy of any notice to the
Company shall be sent to: Jenkens & Xxxxxxxxx Xxxxxx Xxxxxx LLP, The Chrysler
Building, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (Attn: Xxxxxx Xxxx
Xxxxxxxx, Esq.); Fax No.: (000) 000-0000. A copy of any notice to Viral Genetics
shall be sent to: Viral Genetics, Inc., 000 Xxxxxxx Xxxxxx, Xxxxx Xxxxxxxx,
Xxxxxxxxxx, 00000, (Attn: Xxxx Xxxxxxxxx); Fax No: (000) 000-0000.
f) Currency. All references to currency in this agreement are to the
lawful currency of the United States of America.
g) Assignment. This Agreement shall be binding upon and inure the
benefit of the parties hereto and their respective successors (by merger,
consolidation or sale of all or substantially all of the assets of such party)
and permitted assigns. This Agreement may not be assigned by
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either party, without the prior written consent of the other party hereto, which
consent shall not be unreasonably withheld; provided, however, that Viral
Genetics may, upon prior written notice to NYIC identifying any such third
party(ies) and subject to the immediately next succeeding clause, unilaterally
delegate (by partnering or joint-venturing with a third party or parties) its
obligations under this Agreement solely for the purpose of increasing its
manufacturing capacity; further provided, however, that it is agreed by Viral
Genetics that any delegation hereunder for purposes of manufacturing capacity
shall not relieve Viral Genetics from liability, and Viral Genetics will remain
liable, to NYIC for any and all obligations of Viral Genetics under this
Agreement.
h) Governing Law. This Agreement will be governed by and construed in
accordance with the laws of the State of California, without regard to its
conflicts of law principles. This Agreement shall not be construed or
interpreted with any presumption against the party causing this Agreement to be
drafted.
i) Entire Agreement. This Agreement and the Appendices attached hereto,
together with any definitive distribution agreement executed by the parties
hereto, constitute and shall constitute the complete and exclusive understanding
and agreement between the parties with respect to the subject matter hereof,
superseding and replacing any and all prior agreements, communications, and
understandings (both written and oral) regarding such subject matter all of
which are merged herein. There are no representations, promises or
understandings regarding such subject matter, except to the extent expressly set
forth herein and in any definitive distribution agreement hereafter executed by
the parties hereto.
j) Headings. Section headings have been inserted herein for convenience
of reference only and shall not have any impact on the construction or
interpretation of this Agreement.
k) Counterparts. This Agreement may be executed in counterparts, each
of which, when taken together, shall constitute one and the same instrument.
[SIGNATURE PAGE TO FOLLOW]
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IN WITNESS WHEREOF, each of the parties hereto have executed this
Agreement as of the date first above written.
VIRAL GENETICS, INC.
By: _______________________________
Name: Xxxx Xxxxxxxxx
Title: President
NEW YORK INTERNATIONAL COMMERCE GROUP, INC.
By: _______________________________
Name: Xxxxxx X. XxXxxxxxx
Title: Chief Executive Officer
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APPENDIX A
INTELLECTUAL PROPERTY RIGHTS - DESCRIPTIVE LIST
00
XXXXXXXX X
MINIMUM SALES TARGETS FOR PRC
CUMULATIVE NUMBER OF MONTHS ORDER FOR SALES TO BE RECEIVED
TREATMENTS SOLD("SALES") WITHIN FOLLOWING ISSUANCE OF LICENSE
37,500 12
62,500 24
