EXHIBIT 10.18
AGREEMENT
ON MANUFACTURING, SALES AND DISTRIBUTION
LICENSE FOR HMRLIGNAN(TM)
made this 8th day of April 2005
(hereinafter referred to as the "Agreement")
By and between
XXXXXX S.A. ("LINNEA")
Xxx Xxxxxxxxx, 0000 Xxxxxxxx (Xxxxxxx)
Xxxxxxxxxxx
and
HORMOS MEDICAL CORPORATION ("HORMOS")
Company ID: FI 1085385-9
Itainen Xxxxxxxxx 0
XXX-00000 Xxxxx, Xxxxxxx
XXXXXX and HORMOS are hereinafter referred to
individually as a "Party" or collectively as "Parties"
Whereas, HORMOS has proprietary rights, experience and expertise related
to research and development of compounds extracted from nature
for nutraceutical use, especially a lignan called
********** (HMR). Furthermore, HORMOS has submitted a
notification with the US Food and Drug Administration to market
HMR as a new dietary ingredient.
Whereas, XXXXXX has special experience and expertise on development,
extraction, production and commercialisation of natural
compounds for dietary and nutraceutical use.
Whereas, The Parties are willing to cooperate to further commercialise
HMRlignan(TM).
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NOW, therefore the Parties have agreed as follows:
1. DEFINITIONS
For the purpose of this Agreement:
"Affiliates" shall mean:
a) any organisation or business entity of which fifty percent
(50%) or more of the voting stock is controlled or owned
directly or indirectly by a Party;
b) any organisation or business entity which directly or
indirectly owns or controls fifty percent (50%) or more of the
voting stock of the Party;
c) any organisation or business entity, the majority ownership of
which is directly or indirectly common to, or commonly owned
or controlled by the majority ownership of the Party.
"Bulk Market Price" shall mean fair market price for HMR Bulk Ingredient
sold at the time in the same or comparable market, if available.
"Confidential Information" shall mean information in any tangible form,
data and experience clearly identified as confidential, not
available to the general public, and disclosed to the other Party,
whether (by way of example) scientific, technical, engineering,
operational or economic by nature.
"Dietary Supplement Product(s)" shall mean any dietary ingredient product,
as defined in the US "Dietary Supplement and Health Education Act,
in any galenic formulation intended for consumer use which do not
require GRAS, Novel Food or Pharmaceutical regulatory clearance,
containing HMR Bulk Ingredient. "Functional Food" shall mean food
products containing HMR Bulk Ingredient intended for consumer use
and require GRAS and/or Novel Food approval in order to be marketed.
"GRAS" shall mean "Generally Recognized As Safe" regulatory clearance by
US Food and Drug Administration.
"HMRlignan(TM)" shall mean HORMOS' ******** (HMR, *****)
platform consisting of the Patents, technology, Know-How and
documentation related to said concept;
"HMR Bulk Ingredient" shall mean the bulk ingredient containing HMR as
its sole active ingredient which development, manufacture and/or
commercialisation would infringe Hormos' Patents and Know-How
regarding the bulk ingredient should this Agreement be absent.
"Know-How" shall mean information, results and documentation related to
HMRlignan(TM) and owned or controlled by Hormos. Know-How is
exclusively detailed in section 5.3.
"Material Breach" shall mean a breach of any of the sections 6.1, 6.2,
6.4, 7, 7.1, 7.1.1, 7.1.2, 8, 9.1 or 9.2 provided that such breach
is related to material obligations set forth in said section and
causing damages or loss to the other Party or having a negative
effect on the position of the other Party.
"Net Sales" shall mean gross amount invoiced by XXXXXX or its Affiliates
on account of sales of HMR Bulk Ingredients to customers, less the
following deductions to the extent
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actually allowed or specifically allocated to HMR Bulk Ingredient
using generally accepted accounting standards:
(i) value added taxes, sales and excise taxes and duties paid or
allowed by the selling party and any other governmental
charges imposed upon the importation or sale of HMR Bulk
Ingredient;
(ii) customary and reasonable trade, quantity and cash discounts
actually allowed with respect to the sale HMR Bulk Ingredient;
(iii) customary and reasonable allowances or credits to customers on
account of rejection, withdrawal, recall or return of sold
goods;
(iv) customary and reasonable freight and insurance costs, if they
are included in the selling price invoiced to customers or
otherwise paid by customers, provided always that such
deduction shall not be greater than the balance between the
selling price actually invoiced to the customer and the
standard selling price which would have been charged to such
customer for such Products exclusive of freight and insurance
costs
"Novel Food" shall mean the criteria stated in the European Union
regulatory authority regulation 257/97.
"Patent(s)" shall mean any patent or patent application granted or pending
in any country of the world relevant or necessary for manufacturing,
developing and/or marketing of HMRlignan(TM), and owned or
controlled at the Date of the Agreement or in the future by Hormos,
including those detailed in Section 5 and Schedule 1 attached
hereto, and including all reissues, extensions, substitutions,
confirmations, registrations, revalidations, additions,
continuations in part, refilings and divisions thereof and any
supplemental protection certificates;
"Patent Protection Territory" shall mean any country in the world where a
patent based on the US patent ***** "**************************
******************************************************************
********************************************************************
********************************************************
(application No. US *********) is granted or pending at the Date of
the Agreement.
"Prescription Pharmaceutical Product" shall mean any pharmaceutical
product with regulatory approval for any indication and in any
galenic formulation that requires doctor's prescription in order to
be sold to the consumers according to the national laws. For
avoidance of doubt, OTC products are not Prescription Pharmaceutical
Products.
"Scope of the Agreement" shall mean HORMOS' rights to be licensed or
materials to be transferred, as the case may be, related to
HMRlignan(TM) as defined in this Agreement but consisting
exhaustively of
1. Patents as described in section 5.1.
2. Know-how & Documentation as described in section 5.2.
3. Trademarks as described in section 5.3
4. Regulatory notifications as described in section 5.4
5. Raw Material as described in section 5.5.
"Term" shall mean the period of time commencing on the Date of the
Agreement and ending at the expiry of US patent ****** including
any extension possibly granted to it.
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"Trademarks" shall mean Hormos proprietary trademarks set forth Section 5
and in Schedule 1;
2. GRANT OF LICENSE
2.1. HORMOS hereby grants XXXXXX for the Patents, Trademarks and Know-How &
Documentation an exclusive world-wide license right to develop,
manufacture, market and distribute HMR Bulk Ingredient for the purpose of
developing, manufacturing, selling and marketing Dietary Supplement
Products, including the right to grant sublicenses to third parties to
develop, manufacture, sell and market Dietary Supplement Products, subject
to the terms and conditions of this Agreement. HORMOS shall not grant the
same right to any third party nor exercise the rights itself save for that
HORMOS shall retain the nonexclusive right to market HMRlignan(TM) in
finished forms as further defined in in sections 2.3 and 3.3 of this
Agreement.
2.2. Exclusion of granted licenses. For avoidance of doubt, nothing in this
agreement shall be construed as a grant of license by HORMOS to XXXXXX
(i) to develop, manufacture, market and distribute HMRlignan(TM) in
Functional Foods for any purpose or indication,
(ii) to develop, manufacture, market and distribute HMRlignan(TM) in
applications where GRAS and/or Novel Food regulatory clearance is a
prerequisite for a marketing license
(iii) to market or sell bulk ingredient containing HMRlignan(TM) for
Prescription Pharma formulation, unless otherwise agreed in this
Agreement.
2.3. Non-exclusive rights retained by HORMOS. HORMOS shall retain the right to
manufacture or have manufactured the products containing HMRlignan(TM),
develop, import, market and distribute Dietary Supplement Products in the
USA. When producing such Dietary Supplement Products for the US market,
Hormos shall purchase HMR Bulk Ingredient from XXXXXX under reasonable
commercial terms, including that XXXXXX shall not charge more than HMR
Bulk Market Price. In the event a controlling interest in HORMOS is
acquired by a company operationally active in the nutraceutical and/or
food industry the transfer of these rights shall be subject to LINNEA's
approval, which shall not be unreasonably withheld.
2.4. When granting sublicenses or any other right to use the Scope of the
Agreement, XXXXXX shall not grant rights exceeding or more than the rights
granted to XXXXXX with respect to Scope of the Agreement and shall cause
the sublicense to comply with the obligations of this Agreement.
3. OPTION RIGHTS
3.1. XXXXXX will have an exclusive option to obtain an exclusive license under
HORMOS' Patents, Trademarks and Know-How & Documentation to the GRAS
and/or Novel Food status including the right to market and sell
HMRlignan(TM) in functional food applications and the right to market and
sell the Dietary Ingredient Product where GRAS and/or Novel Food
regulatory clearance is a prerequisite for a marketing authorisation.
3.2. Option mechanism. LINNEA'S option right to GRAS and Novel Food status will
expire on December 31 2007 for GRAS and December 31 2007 for Novel Food.
If XXXXXX chooses not
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to exercise these option rights, HORMOS is free to license HMRlignan(TM)
to third parties for Functional Food applications. HORMOS shall cause the
licensees to consider XXXXXX as their supplier of HMR Bulk Ingredient in
priority to any other manufacturers at commercially reasonable terms.
3.3. HORMOS shall retain the non-exclusive right to manufacture or have
manufactured the products containing HMRlignan(TM), to develop, import,
market and distribute HMRlignan(TM) in finished forms in Functional Food
applications and to market and sell the HMRlignan(TM) containing products
under GRAS status on the US market. When producing such Functional Food
products for the US market, Hormos shall purchase HMR Bulk Ingredient from
XXXXXX under reasonable commercial terms, including that XXXXXX shall not
charge more than HMR Bulk Market Price. In the event a controlling
interest in HORMOS is acquired by a company operationally active in the
nutraceutical and/or food industry the transfer of these rights shall be
subject to LINNEA's approval, which shall not be unreasonably withheld.
4. PRESCRIPTION PHARMA APPLICATIONS
HORMOS shall retain itself all rights to develop, manufacture, market and
distribute HMRlignan(TM) for Prescription Pharmaceutical Applications and
the right to license said rights to third party(ies). However, unless
agreed in writing otherwise, HORMOS shall not establish any licensing
agreement to use HMRlignan(TM) for Prescription Pharmaceutical
Applications before January 1 2010. XXXXXX shall be preferred supplier of
HMR Bulk Ingredient to licensees or sublicensees for Prescription
Pharmaceutical Applications subject to XXXXXX meeting necessary regulatory
requirements.
5. SCOPE OF THE AGREEMENT
5.1. Subject to the terms and conditions of this Agreement, the rights and
material to be licensed or transferred in this Agreement are detailed as
follows and in schedules attached hereto:
5.2. Patents. HORMOS shall grant a license to XXXXXX to the Patents, including
following patents and patent applications
- *****************************************************************
************************************************************
********************************************************************
******************* (USP ******, application Xx.Xx. US *****)
- ********************************************************************
******************* (USP ******, application No. US *****)
- ********************************************************** US patent
application ***** (1st priority No. *****)
- ******************************************************************
************* (application No. US ******)
- *********************************** PCT/************ (1st priority
No. *********)
- Lignan complexes PCT/****** (1st priority No. ******)
- Lignan derivatives PCT/****** (1st priority No. ******)
- Lignan formulations PCT/****** (1st priority No. ******)
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- **************** PCT/****** (1st priority No. FI ******)
- **************** PCT/******(1st priority No. ******)
- **************** PCT/******(1st priority No. ******)
- **************** FI patent ******.
- **************** US patent application ******.
- **************** FI ******.
The status of patent prosecution at the time of the execution of this
Agreement is set out in Schedule 1.
5.3. Know-how. HORMOS shall xxxxx XXXXXX access to the following know-how
and documentation:
5.3.1. studies sponsored by HORMOS in the following areas:
- General Pharmacodynamics,
- Toxicity
- Single Dose Toxicity
- Repeated Dose Toxicity
- Mutagenic Potential
- Pharmacokinetics
- Clinical Single and Repeated Dose Trials
The Studies are detailed in Schedule 2: HMRlignan(TM) Study Archive.
5.3.2. Written information of the manufacture of HMRlignan(TM) and its
physicochemical properties,
5.4. Trademarks. Subject to the terms and conditions of this Agreement, HORMOS
grants a license to XXXXXX to the following trademarks and goodwill and
know-how associated therewith:
- HMRlignan(TM)
The status of Trademark registration is set forth in Schedule 1.
5.5. Regulatory Notification. HORMOS has obtained from the US FDA a New Dietary
Ingredient Notification acknowledgement for HMRlignan(TM), which XXXXXX
has familiarized itself with.
5.6. Products & Raw Material.
5.6.1. HORMOS shall transfer ownership to XXXXXX on execution of this
Agreement, the following:
a) approximately 10 kg of *********** complex
b) approximately 3,000 kg chips of Norway spruce as a raw material
for the extraction of ***********
5.6.2. As instructed by XXXXXX, HORMOS shall clearly label as belonging to
XXXXXX and store said raw material at HORMOS' premises and at HORMOS' cost
until XXXXXX requests that said raw material will be submitted by HORMOS
to the address or place appointed by
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XXXXXX and at LINNEA's cost. However, if XXXXXX has not transferred said
raw material within six months from the Date of the Agreement, HORMOS is
entitled to destroy the raw material.
5.6.3. The liability of the risk for the raw material passes from HORMOS
to XXXXXX upon execution of this Agreement regardless of who is managing
the storage of the raw material.
6. REMUNERATION
6.1. In further consideration for the license granted, XXXXXX agrees to pay
HORMOS:
(i) Signing fee of 400.000 EUR within 30 days of the latest signing of
this Agreement.
(ii) Running royalty of ****** (**) per cent of all Net Sales of HMR Bulk
Ingredient produced by XXXXXX or any Affiliate of XXXXXX to
unaffiliated customers or purchasers in the Patent Protection
Territory and to whom XXXXXX has granted a right to produce and
market Dietary Supplement Product. The same royalty is payable for
the HMR Bulk Ingredient consumed in the production of Dietary
Supplement Products at the Bulk Market Price, if XXXXXX itself or
any of its Affiliates directly markets Dietary Supplement Products.
The royalty is payable as from April 1, 2007 till the end of the
Term. For avoidance of doubt, the period from the Date of this
Agreement till March 31, 2007 is royalty free.
(iii) Running royalty of ****** (**) per cent of all Net Sales of HMR Bulk
ingredient produced by XXXXXX or any Affiliate of XXXXXX to
unaffiliated customers or purchasers outside the Patent Protection
Territory and in countries where a patent application based on US
patent ***** has been rejected. In case the patent protection
regarding any Patent or Patent application based on US patent *****
will be restored due to appeal or other measures available, the
royalty of fifteen (15) per cent will be paid prior and after the
date the patent protection has been gained in that country.
The royalty is payable as from April 1, 2007 till the end of the
Term. For avoidance of doubt, the period from the Date of this
Agreement till March 31, 2006 is royalty free.
(iv) A royalty of ****** (**) per cent for any other income XXXXXX
receives from unaffiliated customers or sublicensees of XXXXXX to
which XXXXXX has sublicensed its rights to HORMOS' HMRlignan(TM)
IPR, including but not limited to, exclusivity fees, licensing fees,
milestone payment and royalties for the sales of Dietary Supplement
Products, etc.
(v) In the event that a license from a third party is necessary to
develop, manufacture or market HMRlignan(TM) in a certain country or
territory due to third party dominating proprietary intellectual
property rights, XXXXXX may offset against royalties payable to
HORMOS any payments made due to such third party intellectual
property rights, provided that HORMOS has given its prior written
consent, which consent shall not be
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unreasonably withheld and that in no event shall the royalty due to
HORMOS be reduced more than down to ****** (**) per cent.
(vi) For the avoidance of doubt, for each Product the Net Sales shall be
calculated only once for the first sale of such Product by either
XXXXXX or its Affiliate to a customer.
(vii) In consideration of expenses incurred by XXXXXX during the startup
period, HORMOS will credit XXXXXX against first due royalty payments
sum of EUR ****** of the first payable royalty payments.
6.2. Any royalty payable hereunder shall be due and paid yearly within 60 days
after the end of each 6-months period commencing the effective date of
this agreement. Together with the royalty payments, XXXXXX shall provide
HORMOS with calculation and specification for accrued royalties and yearly
volume of sales of HMR Bulk Ingredient.
XXXXXX shall keep and require its Affiliated Companies and sublicensees to
keep and maintain complete and accurate records and books of account in
sufficient detail and form so as to enable verification of royalties paid
or payable hereunder. Not more often than once a year XXXXXX shall allow
and arrange HORMOS to audit its own or its Affiliated Company's and/or
sublicensees' records and books of account for correctness of royalty
payments and Net Sales, if requested and at the auditing party's expense.
All payments, once made, shall be non-refundable.
6.3. Prior to XXXXXX or any of its sublicensees start to commercially exploit
the Patents, XXXXXX undertakes to inform HORMOS in writing which are the
Patents to be exploited, and if requested by HORMOS, how the Patents are
exploited.
6.4. Remuneration for option rights. In case XXXXXX decides to exercise its
exclusive option to sell Products under GRAS or Novel Food status, XXXXXX
agrees to pay HORMOS:
(i) ***** USD for GRAS status, and
(ii) ***** USD for Novel Food status
If XXXXXX decides to exercise its option rights, ** % of the applicable
fee in both cases (i) and (ii) will be payable at filing of GRAS/Novel
Food application and ** % on approval.
7. PERFORMANCE MILESTONES
7.1. If XXXXXX do not achieve either or both of the following yearly minimum
volumes with regard to the sales of HMR Bulk Ingredient for year 2006 or
any year onwards, then the Parties shall discuss in good faith necessary
measures to improve the volume of sales. If the result of discussions do
not satisfy HORMOS, and failure to meet yearly minimum volumes is not a
direct result of act or negligence of HORMOS, then HORMOS shall have the
right to unilaterally terminate the exclusivity of licensed rights with
regard to Dietary Supplement Products or products requiring GRAS/Novel
Food status or both, as the case may be, and HORMOS will be entitled in
its sole discretion to discuss, negotiate and enter into an agreement(s)
with third parties regarding grant of licenses or sublicenses for its
HMRlignan(TM) and the Scope of the Agreement. For avoidance of doubt, if
XXXXXX has failed to meet the
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yearly Performance Milestones of sales of HMR Bulk Ingredient for either
Dietary Supplement Products or products requiring GRAS/Novel Food status,
but not both, XXXXXX shall maintain the exclusivity for the products it
has reached the yearly Performance Milestones. However, even after losing
the exclusivity for the production of certain products, XXXXXX will remain
a preferred manufacturer and supplier of HMR Bulk Ingredient to HORMOS'
new licensees or sublicensees subject to agreeable commercial terms and
conditions.
7.1.1. The yearly Performance Milestones for Dietary Supplement Products:
(i) *** kg sales minimum ****
(ii) *** kg sales minimum ****
(iii) *** kg sales minimum ****
7.1.2. In the event either of the GRAS/Novel Food options is exercised the
additional yearly Performance Milestones are as follows:
(iv) *** kg sales minimum *****
(v) *** kg sales minimum *****
(vi) *** kg sales minimum *****
8. BEST ENDEAVOURS
8.1 XXXXXX shall use commercially reasonable efforts to (i) introduce
HMRlignan(TM) into commercial market as soon as practical, (ii) to develop
and exploit herein licensed rights by manufacture and sale of HMR Bulk
Ingredient throughout the territory during the Term of this Agreement,
(iii) to control the quality of the products, and (iv) properly, safely,
fairly and lawfully to develop and exploit the market in the territory for
the products.
8.2 Failure of XXXXXX to comply with previous clause 8.1 shall entitle HORMOS
to unilaterally terminate the exclusive nature of this Agreement and
HORMOS will be entitled in its sole discretion to discuss, negotiate and
enter into an agreement(s) with third parties regarding grant of licenses
or sublicenses for its HMRlignan(TM) and the Scope of the Agreement
9. PROSECUTION AND MAINTENANCE OF INTELLECTUAL PROPERTY RIGHTS
9.1 For the Term of this Agreement, HORMOS shall prosecute and maintain in
force the Patents and Trademarks in accordance with the instructions of
XXXXXX. XXXXXX shall be responsible for all decision making related to the
Patents and related to patenting strategy after the Date of the Agreement.
After approval of yearly patent budget in advance, XXXXXX shall compensate
HORMOS for all external costs arising out of or related to the prosecution
of Patent applications and maintenance of issued Patents. In case XXXXXX
chooses not to pay the prosecution or maintenance of any of the Patents,
XXXXXX shall inform HORMOS in writing and in good time prior to any
deadlines, and HORMOS is entitled but not obliged to give up the
prosecution or maintenance of these Patents. HORMOS may choose at its cost
and responsibility to prosecute or maintain the Patents, whose maintenance
XXXXXX has given up.
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9.2 Trademarks. After the execution of this Agreement, XXXXXX shall be
entitled to exploit the Trademarks in its sole discretion but in a good
and respectful manner.
10. WARRANTIES
10.1. Warranties. Both HORMOS and XXXXXX warrant they have the right to execute
and effect this Agreement.
HORMOS represents and warrants in respect to the Scope of the Agreement,
including the Patents, that as of the Date of this Agreement:
a) it has a legal power to grant license with regard to the Patents and
Trademarks;
b) it has good and marketable title to the Scope of the Agreement;
c) it has not made and will not make any commitments to others
inconsistent with or in derogation of the rights granted hereunder
to XXXXXX;
d) and that the Patents are free and clear from any encumbrances,
liens, pledges or licenses;
e) to the best of HORMOS' knowledge, HORMOS has acquired shares of all
the respective inventors of each invention in the Patents;
f) there are no patent infringement suits or asserted patent
infringement claims pertaining to the Patents pending on the date of
execution of this Agreement.
g) to Hormos' knowledge Patents and Trademarks do not infringe rights
of third parties, excluding identified potentially overlapping
patents set forth in Schedule 3,
h) it has given to XXXXXX all the relevant know-how and information in
written form described in section 5.3 in its possession.
10.2. Negation of Implication by HORMOS.
Nothing in this Agreement shall be construed as
a) A warranty or representation by HORMOS as to the validity or scope
of any licensed Patent; or
b) A warranty or representation that anything made, used, sold or
otherwise disposed of under any of the Patents and Trademarks is or
will be free from infringement of third parties; or
c) A requirement that HORMOS shall file any Patent application, secure
any Patent or Trademark, or maintain any Patent or Trademark in
force, unless so agreed in section 9.1 of this Agreement or in
writing; or
d) An obligation to bring or prosecute actions or suits against third
parties for infringement of Patents or Trademarks; or
E) WARRANTY OR REPRESENTATION OF THE FITNESS, SUITABILITY OR USEFULNESS
OF ANY OF THE SCOPE OF THIS AGREEMENT FOR ANY PURPOSE, OR REGARDING
ANY OTHER MATTER, AND ANY REPRESENTATION OR WARRANTY BY OR ON BEHALF
OF HORMOS WHICH IS NOT EXPRESSLY STATED HEREIN, IS DISCLAIMED,
INCLUDING WITHOUT LIMITATION, ANY IMPLIED WARRANTIES OF
MERCHANTABILITY OF FITNESS FOR A PARTICULAR PURPOSE, OR THAT THE USE
OF THE patents WILL NOT INFRINGE ANY THIRD PARTY PATENT OR
INTELLECTUAL PROPERTY RIGHT.
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10.3. XXXXXX warrants that upon the execution of this Agreement, it has received
all relevant Know-How & Documentation described in section 5.3.
11. APPLICABLE LAW AND DISPUTE RESOLUTION
11.1. This Agreement shall be construed and governed by English law without
giving effect to the choice of law provisions thereof (and without
limiting the foregoing, the United Nations Convention on Contracts for
International Sale of Goods shall not govern this Agreement).
11.2 If after discussion concerning any difference, dispute or question arising
in connection with this Agreement HORMOS and XXXXXX are unable to reach
agreement, the matter shall be finally and exclusively settled by binding
arbitration under the Rules of Arbitration of the International Chamber of
Commerce. The arbitration shall take place in Stockholm, Sweden in the
English language.
The decision will be made by a sole arbitrator appointed in accordance
with applicable Rules, unless the Parties agree in writing that there will
more than one arbitrator. The decision of the arbitrator(s) shall be
binding and conclusive on the Parties, and they shall comply with such
decision in good faith.
12. LIABILITY AND TERMINATION
12.1 If a Party is in Material Breach of its obligations under this Agreement
or repeatedly breaches the terms of this Agreement, and such default is
not cured within thirty (30) days from the date the written notice thereof
has been dispatched, the other Party (the non-breaching Party) is entitled
to terminate this Agreement with immediate effect.
12.2 If a Party is apparently insolvent, declared bankrupt or in a debt
restructuring procedure, the other Party may with written notice terminate
this Agreement immediately, unless the insolvent Party gives satisfactory
guarantees that the Agreement is unaffected by said insolvency.
12.3 For the damages incurred by the non-breaching Party caused by the material
breach of this Agreement, the non-breaching Party shall be entitled to
receive compensation from the breaching Party. The breaching Party shall
be liable for actual and direct damages to the other Party. Parties are
not, however, liable for any punitive, indirect or consequential damages,
including but not limited to loss of profits, arising from this Agreement.
Except as otherwise provided in section 11 below, the Parties' liability
towards each other shall be limited to the amount of ******
(*******) euro.
12.4 During the Term XXXXXX may terminate without any cause this Agreement at
any time by giving HORMOS a written notice 4 months prior to such
termination will become effective. On effective day, any and all rights
granted under this Agreement by HORMOS to XXXXXX will be returned back to
HORMOS and XXXXXX shall not retain itself any rights with regard to HMR
Bulk Ingredient or HMRlignan(TM). In connection with such termination
XXXXXX shall assign HORMOS a right to any improvement or intellectual
property right necessary for the development, manufacture or
commercialisation of HMR Bulk Ingredient or HMRlignan(TM) and all the HMR
Bulk Ingredients in its possession.
13. ASSIGNMENT
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The obligations toward the other Party set out in this Agreement are
deemed personal to the Parties. Therefore, neither Party shall, without
the prior written consent of the other Party, assign its rights or
obligations to any third party. Such consent shall not be withheld if the
non-assigning Party receives and accepts such written assurances of
continued performance and commitments from the assignee as it may
reasonably require or if such an assignment is contemplated in connection
with the sale or merger by a Party of all or substantially all of its
assets to a third party or if such an assignment is made to an Affiliate
of the Party.
For avoidance of doubt, aforementioned does not restrict XXXXXX to
exercise its right to grant sublicenses to third parties subject to terms
and conditions of this Agreement.
14. INDEMNITY FOR PRODUCT LIABILITY
XXXXXX agrees to indemnify, defend and hold HORMOS, its Affiliates and its
and their directors, officers, employees and shareholders harmless from
and against any and all third party claims, suits, proceedings, demands,
liabilities or expenses (including reasonable legal fees) related to
actual or alleged injury, damage, death or other consequence, including
product liability, occurring to any legal or natural person or property,
as result, directly or indirectly, of the possession, use or consumption
of HMR Bulk Ingredient or Dietary Supplement Product actually manufactured
or sold by Xxxxxx, its Affiliates or its sublicensees. Without limiting
the generality of the foregoing, XXXXXX shall not indemnify HORMOS in
respect of claims and suits for injury and damages caused by HORMOS'
failure to provide XXXXXX with necessary information in its possession,
fraud, negligence or wilful misconduct of HORMOS or its employees or
directors or caused by raw material provided by HORMOS.
15. INFRINGEMENT OF INTELLECUAL PROPERTY RIGHTS
15.1. Infringement of Patents, Trademarks and Know-How
Each Party shall report promptly in writing to other Party any known or
suspected infringement of any Patents, Trademarks, Know-How or other
intellectual property right included in the Scope of the Agreement.
XXXXXX shall have the first right to commence any proceedings anywhere in
the world against infringing third party. XXXXXX shall keep HORMOS
informed promptly of status of such actions. HORMOS shall have a right to
participate and be represented in any proceedings by its own counsel at
its own expense. XXXXXX shall not settle any such proceedings involving
the Patents or Trademarks without obtaining HORMOS' prior written consent,
which consent shall not be unreasonably withheld. If XXXXXX shall not take
any action, it shall inform HORMOS within 30 days after it has become
aware of such infringement, and HORMOS has a secondary right, at its
expense, to any action due to such infringement.
15.2. Alleged Infringement of third party rights
If a third party notifies a Party, Affiliate or a sublicensee of, or
commences proceedings for, an alleged infringement of the third party
intellectual property rights or unauthorised use of its technology arising
out of development, manufacture, use, sale or marketing of HMRlignan(TM),
HMR Bulk Ingredient or Dietary Supplement Products or Patent validity
related actions, that Party shall notify the other Party promptly of claim
or the commencement of such proceedings.
- 12 -
At LINNEA's request HORMOS shall advise XXXXXX regarding the technical
merits of such claim.
XXXXXX agrees to indemnify, defend and hold HORMOS, its Affiliates and its
and their directors, officers, employees and shareholders harmless from
and against any and all third party claims, suits, proceedings, demands,
liabilities or expenses (including reasonable legal fees) related to
infringement of third party's intellectual property rights or unauthorised
use of its proprietary technology arising out of development, manufacture,
use, sale or marketing of HMRlignan(TM), HMR Bulk Ingredient or Dietary
Supplement Products by XXXXXX, its Affiliate or its sublicensees or Patent
validity related actions, provided that XXXXXX has sole control of and
authority over the defence or settlement of the proceedings and HORMOS
cooperates with respect to technical merits of said claim. Without
limiting the generality of the foregoing, XXXXXX shall not indemnify
HORMOS in respect of claims and suits related to infringement of third
party's intellectual property rights if HORMOS has failed to disclose to
XXXXXX information of infringements of third party rights known by HORMOS
at the Date of the Agreement
Nothing herein shall be interpreted as an indemnity by a Party in respect
of claims and suits for injury and damages caused by fraud, negligence,
failure or wilful misconduct of the other Party or its employees or
directors.
15.3 HORMOS shall neither have any obligations to defend any Patents, nor
compensate for or indemnify, defend or hold harmless XXXXXX, XXXXXX
Affiliates or LINNEA's sublicensees or customers against any claim, third
party infringement claim or other claim.
16. CONFIDENTIALITY
HORMOS and XXXXXX have entered into a Confidentiality Agreement on 20
March 2003. The Parties agree to treat all Confidential Information
already disclosed as Confidential Information. In addition, in the future
the Parties may receive Confidential Information from the other Party
related to the further development of HMRlignan(TM) or their trade secrets
or business activities. Both Parties warrant that they shall treat such
information as confidential and that they shall not:
a) use such information to any other purpose but to exercise their
rights, fulfill their obligations as set out in this Agreement or as
agreed separately, as the case may be, and
b) disclose received information to any third party without prior
written consent of the other Party, acquired separately for each
disclosure of information.
To the extent it can be established by sufficient evidence, the
obligations set forth in this Agreement shall not apply to:
1) information which at the time of the disclosure hereunder is
in the public domain; or
2) information which, after disclosure hereunder, becomes part of
the public domain in other way than by faults of the receiving
Party; or
3) information which has already been in the possession of the
Party at the time of disclosure hereunder, or
- 13 -
4) information which a Party receives from a third party who is
not under any obligation of secrecy towards the other Party;
or
5) information which has been independently conceived or
developed by the receiving Party without breach of the
confidentiality obligations.
17. FORCE MAJEURE
Force majeure is an event that prevents the performance or causes
unreasonable difficulties for the fulfilment of that Party's obligations
under this Agreement, such as war, riot, acts of God, fire, and
interruption of the energy delivery, strike, blockade or other equally
important and unusual cause beyond the affected Party's control. The Party
(or Affiliates) affected by Force Majeure shall not be liable for any
delays or failures to perform the obligations under this Agreement. The
Party affected by the force majeure is entitled to postpone its
performance as long as Force Majeure event continues. If the Force Majeure
event continues more than five (5) months, either Party may terminate this
Agreement immediately by giving written notice to the other Party.
18. MISCELLANEOUS
18.1. Non-waiver
Either Party's failure to exercise or enforce any right conferred upon it
hereunder shall not be deemed to be a waiver of any such right unless
specifically so stipulated or operate to bar the exercise of performance
thereof at any time or times thereafter, nor shall its waiver of any right
hereunder at any given time, including rights to any payment, be deemed a
waiver thereof for any other time.
18.2. Severability
In case any provision of this Agreement shall be invalid, illegal or
unenforceable due to the legislation of Finland, Switzerland, the European
Union or the USA, such invalidity, illegality or unenforceability shall
not affect any other provision hereof. The Parties shall negotiate in good
faith in order to agree the terms of a mutually satisfactory provision to
be substituted for the provision which is invalid, illegal of
unenforceable and which as nearly as possible validly gives effect to the
Parties' intentions as expressed herein.
18.3. Headings
All section headings in this Agreement are for convenience only and shall
not in any way affect the meaning or interpretation of the Agreement.
18.4. Entire Agreement and Amendments
This Agreement, together with all Appendices and Schedules hereto,
represents the full and complete understanding and agreement of the
Parties pertaining to the subject matter hereof and prevails over all
statements, clauses or conditions which may be contained in any other form
or document. No modifications and amendments to this Agreement shall be
valid unless made in writing and signed by duly authorized representatives
of XXXXXX and HORMOS.
19. NOTICES
Notices provided hereunder and concerning validity or term of this
Agreement are to be given
- 14 -
by either Party to the other shall be in writing and shall be given in
person or be prepaid registered mail to the respective addresses or to
such other addresses as the Parties may hereafter communicate to each
other in writing.
Notices to LINNEA shall be sent to: XXXXXX S.A.
Xxx Xxxxxxxxx, 0000 Xxxxxxxx (Xxxxxxx)
Xxxxxxxxxxx
Telefax:
Notices to HORMOS shall be sent to: Hormos Medical Corporation
PharmaCity, Itainen Xxxxxxxxx 0
XXX-00000 Xxxxx, Xxxxxxx
Telefax: 358 2 410 8001
20. SIGNATURES
This Agreement has been duly executed in duplicate copies, one retained by
both contracting Parties.
XXXXXX S.A.
By: /s/ Xxxxxxx Xxxxxxxxx
---------------------
Name: Xxxxxxx Xxxxxxxxx
Title: President (Authorized Signatory)
HORMOS MEDICAL CORPORATION
By: /s/ Xxxxx Xxxxxxxxxxxx
----------------------
Name: Xxxxx Xxxxxxxxxxxx
Title: Chief Executive Officer (Authorised Signatory)
SCHEDULES:
Schedule 1: Current Patent and Trademark Status
Schedule 2: HMRlignan(TM) Study Archive
Schedule 3: List of potentially overlapping patents of third parties known by
HORMOS
- 15 -
SCHEDULE 1
CURRENT PATENT AND TRADEMARK STATUS 9.4.2005
PATENTS
INVENTION ID *******
TITLE *************
COUNTRYCOD COUNTRYNAME CASE APPLICANTID APPLDATE APPLNO STATUS XXXXX EXPIREDA 1PRIONUMBER 1PRIODAY
***** ***** ***** ***** ***** ***** ***** ***** *****
***** ***** ***** ***** ***** ***** *****
INVENTIONID HM-3O001
TITLE **************************************************************
**************************************************************
****************
COUNTRYCOD COUNTRYNAME CASE APPLICANTID APPLDATE APPLNO STATUS XXXXX EXPIREDA 1PRIONUMBER 1PRIODAY
***** ***** ***** ***** ***** ***** ***** ***** ***** ***** ****
***** ***** ***** ***** ***** ***** ***** ***** ****
***** ***** ***** ***** ***** ***** ***** ***** ****
***** ***** ***** ***** ***** ***** ***** ***** ***** ***** ****
***** ***** ***** ***** ***** ***** ***** ***** ****
***** ***** ***** ***** ***** ***** ***** ***** ***** ***** ****
***** ***** ***** ***** ***** ***** ***** ***** ***** ***** ****
***** ***** ***** ***** ***** ***** ***** ****
***** ***** ***** ***** ***** ***** ***** ***** ****
***** ***** ***** ***** ***** ***** ***** ***** ****
***** ***** ***** ***** ***** ***** ***** ***** ****
***** ***** ***** ***** ***** ***** ***** ***** ****
***** ***** ***** ***** ***** ***** ***** ***** ***** ****
SCHEDULE 1
COUNTRYCOD COUNTRYNAME CASE APPLICANTID APPLDATE APPLNO STATUS XXXXX EXPIREDA 1PRIONUMBER 1PRIODAY
***** ***** ***** ****** ***** ***** ***** ***** *****
***** ***** ***** ****** ***** ***** ***** ***** *****
***** ***** ***** ****** ***** ***** ***** ***** *****
***** ***** ***** ****** ***** ***** ***** ***** ***** ***** *****
***** ***** ***** ****** ***** ***** ***** ***** ***** ***** *****
***** ***** ***** ****** ***** ***** ***** ***** *****
***** ***** ***** ****** ***** ***** ***** ***** ***** ***** *****
***** ***** ***** ****** ***** ***** ***** ***** *****
***** ***** ***** ****** ***** ***** ***** ***** *****
INVENTIONID *****
TITLE ****************
COUNTRYCOD COUNTRYNAME CASE APPLICANTID APPLDATE APPLNO STATUS XXXXX EXPIREDA 1PRIONUMBER 1PRIODAY
***** ***** ***** ***** ***** ***** ***** ***** *****
***** ***** ***** ***** ***** ***** ***** ***** *****
***** ***** ***** ***** ***** ***** ***** ***** *****
INVENTIONID ******
TITLE ***********
COUNTRYCOD COUNTRYNAME CASE APPLICANTID APPLDATE APPLNO STATUS XXXXX EXPIREDA 1PRIONUMBER 1PRIODAY
***** ***** ***** ***** ***** ***** ***** ***** *****
SCHEDULE 1
INVENTIONID *****
TITLE ************
COUNTRYCOD COUNTRYNAME CASE APPLICANTID APPLDATE APPLNO STATUS XXXXX EXPIREDA IPRIONUMBER IPRIODAY
**** **** **** **** **** **** **** **** ****
**** **** **** **** **** **** **** **** ****
**** **** **** **** **** **** **** **** ****
**** **** **** **** **** **** **** **** ****
INVENTIONID *****
TITLE ************
COUNTRYCOD COUNTRYNAME CASE APPLICANTID APPLDATE APPLNO STATUS XXXXX EXPIREDA IPRIONUMBER IPRIODAY
**** **** **** **** **** **** ****
INVENTIONID ******
TITLE ******
COUNTRYCOD COUNTRYNAME CASE APPLICANTID APPLDATE APPLNO STATUS XXXXX EXPIREDA IPRIONUMBER 1PRIODAY
**** **** **** **** **** **** **** **** ****
**** **** **** **** **** **** **** **** ****
**** **** **** **** **** **** **** **** ****
**** **** **** **** **** **** **** **** ****
INVENTIONID *******
TITLE **************
COUNTRYCOD COUNTRYNAME CASE APPLICANTID APPLDATE APPLNO STATUS XXXXX EXPIREDA IPRIONUMBER IPRIODAY
***** ***** ***** ***** ***** ***** *****
SCHEDULE 1
INVENTIONID *******
TITLE *******
COUNTRYCOD COUNTRYNAME CASE APPLICANTID APPLDATE XXXXXX STATUS XXXXX EXPIREDA 1PRIONUMBER 1PRIODAY
******* ******* ***** ******* ******* ******* ******* ******* *******
******* ******* ***** ******* ******* ******* ******* ******* *******
******* ******* ***** ******* ******* ******* ******* ******* *******
INVENTIONID *******
TITLE *******
COUNTRYCOD COUNTRY NAME CASE APPLICANTID APPLDATE XXXXXX STATUS XXXXX EXPIREDA 1PRIONUMBER IPRIODAY
******* ******* ***** ******* ******* ******* ******* ******* *******
******* ******* ***** ******* ******* ******* *******
******* ******* ***** ******* ******* ******* ******* ******* *******
******* ******* ***** ******* ******* ******* ******* ******* *******
INVENTIONID ************
TITLE ************
COUNTRYCOD COUNTRYNAME CASE APPLICANTID APPLDATE XXXXXX STATUS XXXXX EXPIREDA 1PRIONUMBER 1PRIODAY
******* ******* ******* ******* ******* ******* pending
SCHEDULE 1
INVENTIONID ********
TITLE ********
COUNTRYCOD COUNTRYNAME CASE APPLICANTID APPLTIATE XXXXXX Status XXXXX EXPIREDA 1PRIONUMBER 1PRIODAY
******* ******* ***** ******* ******* ******* ******* ******* *******
******* ******* ***** ******* ******* ******* ******* ******* *******
******* ******* ***** ******* ******* ******* ******* ******* *******
******* ******* ***** ******* ******* ******* ******* ******* *******
INVENTIONLID *******
TITLE *******
COUNTRYCOD COUNTRYNAME CASE APPLICANTID APPLDATEAPPINO STATUS XXXXX EXPIREDA 1PRIORNUMBER 1PRIODAY
******* ******* ***** ******* ******* ******* ******* ******* *******
******* ******* ***** ******* ******* ******* ******* ****** *******
******* ******* ***** ******* ******* ******* ******* ******* *******
******* ******* ***** ******* ******* ******* ******* ******* *******
INVENTIONID ********
TITLE ********
COUNTRYCOD COUNTRYNAME CASE APPLICANTID APPLDATE XXXXXX STATUS XXXXX EXPIREDA IPRIONUMBER 1 PRIODAY
******* ******* ***** ******* ******* ******* ******* ******* *******
******* ******* ***** ******* ******* ******* ******* ******* *******
******* ******* ***** ******* ******* ******* ******* ******* *******
******* ******* ***** ******* ******* ******* ******* ******* *******
SCHEDULE 1
TRADEMARKS
US trademark application No. 78/294,174, filed 29 Aug 2003 for the wordmark
"HMRlignan" in classes 1 and 5. Notice of Allowance issued on November 30,2004.
The registration will be postponed until a Statement of Use is filed.
SCHEDULE 2
STUDY OLD STUDY TITLE PROTOCOLL DRAFT FINAL STUDY LABORATORY/CRO CRO STUDY AMEND. COMMENTS
NUMBER NUMBER REPORT REPORT DIRECTOR NUMBER
(HORMOS LOGO)
HMRLIGNAN(TM) STUDY ARCHIEVE
STUDY STUDY CODE OLD CODE
----- ---------- --------
***** ***** *****
***** ***** *****
***** ***** *****
***** ***** *****
***** ***** *****
***** ***** *****
***** ***** *****
***** ***** *****
***** ***** *****
STUDY OLD STUDY TITLE PROTOCOLL DRAFT FINAL STUDY LABORATORY/CRO
NUMBER NUMBER REPORT REPORT DIRECTOR
Chemical and pharmaceutical documentation=II
General Pharmacodynamics= ******
**** **** **** **** **** **** ****
**** **** **** **** **** **** ****
**** **** **** **** **** **** ****
**** **** **** **** **** **** ****
**** **** **** **** **** **** ****
**** **** **** **** **** **** ****
**** **** **** **** **** **** ****
**** **** **** **** **** **** ****
**** **** **** **** **** **** **** ****
**** **** **** **** **** **** **** ****
STUDY CRO STUDY AMEND. COMMENTS
NUMBER NUMBER
Chemical and pharmaceutical documentation=II
General Pharmacodynamics= ******
**** **** ****
**** **** ****
**** **** ****
**** **** ****
**** **** ****
**** **** ****
**** **** ****
**** **** ****
**** **** ****
**** **** ****
STUDY OLD STUDY TITLE PROTOCOLL DRAFT FINAL STUDY LABORATORY/CRO
NUMBER NUMBER REPORT REPORT DIRECTOR
Toxicity= 44, Single Dose Toxicity 441, Repeated Dose Toxicity 442 (Old Code: IIIA)
***** ***** ***** ***** ***** *****
***** ***** ***** ***** ***** ***** *****
***** ***** ***** ***** ***** ***** ***** *****
**** ***** ***** ***** ***** ***** ***** *****
**** ***** ***** ***** ***** ***** ***** *****
**** ***** ***** ***** ***** *****
***** ***** ***** ***** ***** ***** *****
**** ***** ***** ***** ***** ***** *****
*****************************
**** ***** ***** ***** ***** ***** *****
**** ***** ***** ***** ***** ***** ***** *****
**** ***** ***** ***** ***** ***** *****
STUDY CRO STUDY AMEND. COMMENTS
NUMBER NUMBER
Toxicity= 44, Single Dose Toxicity 441, Repeated Dose Toxicity 442 (Old Code: IIIA)
***** *****
***** *****
***** ***** ***** *****
***** ***** ***** *****
***** ***** ***** *****
*****
***** *****
********************************
***** ***** ***** *****
***** ***** *****
***** *****
STUDY OLD STUDY TITLE PROTOCOLL DRAFT FINAL
NUMBER NUMBER REPORT REPORT
******
******
STUDY STUDY LABORATORY/CRO CRO STUDY AMEND. COMMENTS
NUMBER DIRECTOR NUMBER
******
STUDY OLD STUDY TITLE PROTOCOLL DRAFT FINAL
NUMBER NUMBER REPORT REPORT
*****
STUDY STUDY LABORATORY/CRO CRO STUDY AMEND. COMMENTS
NUMBER DIRECTOR NUMBER
*****
SCHEDULE 3
Potentially overlapping patents of third parties known by HORMOS
1. Country: *****
Inventors: *********
Title: *********
*********
*********
Patent Assignee: ********
Patent no: ******
