This Asset
Transfer Agreement (this “ Agreement ”) is made
as of June 23, 2005 by and between Mindset Biopharmaceuticals
(USA), Inc., (hereafter “ Assignor ”), a
corporation existing under the laws of the State of Delaware,
having an office at 535 W. 34 th Street, Suite 206A, New York, NY 10001, and
Intellect Neurosciences, Inc., a Delaware corporation, having a
place of business at 465 West 23 rd Street, Apt I2-J, New York, New York 10001
(“ Assignee ”). Assignor and Assignee are
referred to collectively in this Agreement as the “
Parties .” Certain other capitalized terms used in
this Agreement are defined in Section 1 hereto.
WHEREAS Assignor
is the owner or exclusive licensee under the Licenses being
assigned hereunder of the Trademarks, the Patents and Patent
Applications, the Know-How, and the Inventions (collectively the
“ Assets ”).
WHEREAS, Assignee,
is desirous of acquiring the entire right, title and interest of
Assignor in and to said Assets;
WHEREAS, from time
to time on the understanding that the Parties would enter into an
agreement on terms substantially similar to this Agreement, the
principal stockholders of Assignee advanced certain amounts to
Assignor to pay filing fees and legal fees with respect to the
prosecution of certain patent rights to prevent the lapse of such
patents; and
WHEREAS, for the
consideration set forth below, Assignor wishes to sell, assign,
convey and transfer to Assignee all of the Assignor’s right,
title and interest to and in the Assets, all subject to the
provisions of this Agreement as more fully set forth
below.
NOW, THEREFORE, TO
ALL WHOM IT MAY CONCERN, BE IT KNOWN, that for good and valuable
consideration, the receipt of which is hereby acknowledged, the
Parties agree as follows:
(a)
“ Acceleration Event ” means (i) the
liquidation, termination of existence, dissolution or the
appointment of a receiver or custodian for the Assignor or any part
of its property if such appointment is not terminated or dismissed
within thirty (30) days, (ii) the institution against the
Assignor of any proceedings under the United States Bankruptcy Code
or any other federal or state bankruptcy, reorganization,
receivership, insolvency or other similar law affecting the rights
of creditors generally, which proceeding is not dismissed within
thirty (30) days of filing; (iii) the institution by the
Assignor of any proceedings under the United States Bankruptcy Code
or any other federal or state bankruptcy, reorganization,
receivership, insolvency or other similar law affecting the rights
of creditors generally or the making by the Assignor of a
composition or an assignment or trust mortgage for the benefit of
creditors or (iv) any claim or proceeding relating to or
arising out of or referencing in any way the transactions
contemplated by this Agreement the Ancillary Agreements, or any
actions taken by any party in anticipation thereof (collectively,
the “ Transactions ”), in any forum, against
Assignor or any of its current or former officers, directors,
stockholders, agents, representatives, advisors, successors
or
assigns, or
Assignee or any of its current or former officers, directors,
stockholders, agents, representatives, advisors, successors or
assigns or any party related to the Transactions.
(b)
“ Ancillary Agreements ” shall have the meaning
set forth in Section 4 of this Agreement.
(c)
“ Annex I Claims ” shall have the meaning set
forth in Section 2 of this Agreement.
(d)
“ Annex II Claims ” shall have the meaning set
forth in Section 2 of this Agreement.
(e)
“ Annex III Claims ” shall have the meaning set
forth in Section 2 of this Agreement.
(f)
“ Annex I Claim Reduction ” means the initial
reduction of the Original Principal Annex I Amount by 30% at the
Effective Date.
(g)
“ ANTISENILIN ” means any “free-end
specific” antibody molecule that could be developed under the
Patents.
(h)
“ Assets ” means the Licenses, Patents, Patent
Applications, Trademarks, Know-How and Inventions.
(i)
“ Chain ” shall have me meaning set forth in
Section 2 of this Agreement.
(j)
“ Claims ” shall have the meaning set forth in
Section 2 of this Agreement.
(k)
“ Claims Milestones ” means the First Claims
Milestone and the Second Claims Milestone.
(l)
“ Effective Date ” means the date on which
Assignee acquires at least 90% of $1,277,438.37 ($1,149,694.53)
principal amount of Annex I Claims or such lesser amount as
Assignee agrees to accept in its sole discretion and provides
written notice of such acquisition to Assignor.
(m)
“ First Claims Milestone ” means a reduction of
the Original Principal Annex I Amount, in addition to the Annex I
Claim Reduction, of 10% on June 23, 2007, provided that an
Acceleration Event does not occur before such date.
(n)
“ Inventions ” means those inventions described
in and claimed in the Patents and Patent Applications.
(o)
“ Know-How ” means all proprietary inventions,
technology, trade secrets, know-how, procedures, reagents,
chemicals, data, and biological materials developed by Assignor or
other information, in each case that relate to the Trademarks,
Patents, Patent Applications, Inventions, Licenses or technology
covered by the Licenses and that (a) have been
reduced to
writing or stored electronically or are to another tangible form or
(b) relate to FDA submissions or other regulatory, development
or commercialization activities.
(p)
“ Licenses ” means those licenses listed on
Schedule A hereto.
(q)
“ Maturity Date ” means June 23,
2008.
(r)
“ Mindgenix ” shall have the meaning set forth
in Section 2 of this Agreement.
(s)
“ Mindset Ltd. ” shall have the meaning set
forth in Section 2 of this Agreement.
(t)
“ NYU License ” shall have the meaning set forth
in Section 3 of this Agreement.
(u)
“ Original Principal Annex I Amount ” means the
aggregate principal amount of the claims listed on Annex I
hereto in the amount of $1,277,438.37.
(v)
“ OXIGON ” means Indole-3-propionic
acid.
(w)
“ Patents ” means those patents identified in
Schedule B attached hereto and all divisional,
continuations, continuations-in-part, reissues, extensions,
reexaminations and renewals of such patents in the US and in all
foreign countries.
(x)
“ Patent Applications ” means those patent
applications set forth on Schedule C attached
hereto.
(y)
“ Person ” means any individual, corporation,
general partnership, limited partnership, limited liability
company, trust, association, firm, organization, company, business,
entity, union, society or governmental body.
(z)
“ SAMSF License ” shall have the meaning set
forth in Section 3 of this Agreement.
(aa)
“ Second Claims Milestone ” means a reduction of
the Original Principal Annex I Amount, in addition to the Annex I
Claim Reduction and the First Claims Milestone, by 10% on the
Maturity Date, provided that an Acceleration Event does not occur
before such date.
(bb)
“ Specified Products ” means ANTISENILIN and
OXIGON.
(cc)
“ Taconic Farms Litigation ” shall have the
meaning set forth in Section 2 of this Agreement.
(dd)
“ Trademarks ” means the trademarks and the
goodwill symbolized by the trademarks, set forth on
Schedule C attached hereto.
(ee)
“ Transactions ” shall have the meaning set
forth in Section 1 of this Agreement.
2. Sale
and Assignment . On the terms and conditions and other
provisions of the Ancillary Agreements, on the Effective Date, in
consideration of:
(i) Assignee’s
agreement to purchase, and reduce the Original Principal Annex I
Amount by 30%, provided the foregoing amount shall be 40% if
Assignor achieves the First Claims Milestone, provide further, that
the foregoing amount shall be 50% if the Assignor achieves the
Second Claims Milestone, the claims against Assignor set forth on
Annex I to this Agreement (the “ Annex I Claims
”) and to defer the Assignor’s obligation to pay the
remaining balance of the Annex I Claims until the Maturity
Date;
(ii) Assignee’s
agreement to reduce the principal amount of $743,282 by 50%, claims
against Assignor set forth on Annex II to this Agreement
(the “ Annex II Claims ”) and to defer the
Assignor’s obligation to pay the remaining balance of the
Annex II Claims until the Maturity Date, all subject to certain
on-going discussions between Mindset Biopharmaceuticals ‘
Ltd. (“ Mindset Ltd ”) and Assignee resulting in
the consummation of an agreement, on certain terms and conditions
acceptable to Assignee in its sole and absolute discretion,
pursuant to which Assignee will acquire such Annex II Claims from
Mindset Ltd.;
(iii) Assignee’s
agreement to purchase and to defer Assignor’s
obligation to pay the claims in the principal amount of at least
$1,634,000 listed on Annex III to this Agreement until the
Maturity Date (the “ Annex III Claims ” and,
together with the Annex I Claims and the Annex II Claims ,
the “ Claims ”);
(iv) Assignee’s
assumption of certain of the indebtedness listed on Annex IV
in the aggregate amount of $1,623,730 and Assignee’s
obtainment, on behalf of Assignor, of the release of all
obligations of Assignor relating to such indebtedness, all subject
to certain on-going discussions between each of the respective
creditors set forth on Annex IV and Assignee resulting in
the consummation of agreements between each such creditor and
Assignee on such terms as Assignee shall negotiate with each such
creditor in its sole discretion; provided that the failure
of Assignee to consummate an agreement with any one, more or all of
such creditors shall not constitute a default under this
Agreement;
(v) Assignee’s
assumption of certain obligations of Assignor under the
Licenses;
(vi) Assignee’s
agreement use reasonable efforts to cause Daniel Chain (“
Chain ”), for a minimum of six (6) months,
subject to extension for an additional six months at the option of
the Assignee, to allocate up to 20% of his business time to
Assignor with no further accrual of salary by Assignor,
provided that, notwithstanding the foregoing, the Parties
agree that the failure of the foregoing to occur shall, in no
event, constitute a default under this Agreement;
(vii) the
Assignee’s agreement that, provided that Chain executes an
employment contract with Assignee, substantially in the form
attached hereto as Exhibit A,
before
October 1, 2005, the Maturity Date shall be extended, day for
day, for each day Chain serves as an employee of the Assignee,
subject to the occurrence of an Acceleration Event;
(viii) the
amount of $60,405,47 listed on Annex V previously advanced
by or on behalf of Assignee;
(ix) Assignee’s
agreement to execute a Letter Agreement with Mindgenix, Inc. in the
form attached hereto as Exhibit B: and
(x) Assignee’s
agreement to fund up to $10,000 in patent and patent related cost
related to the development of Increasing Bruin Glucose
Utilization: (US Patent 09/868,501); the Assignor
(i) agrees to toll the applicable statute of limitations
period with respect to any action or proceeding relating to or
arising out of the Claims, and (ii) will sell and transfer to
Assignee and Assignee will purchase from Assignor, all of the
following Assets:
(a) all
of Assignor’
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