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EXHIBIT 10.10
January 4, 2005
LICENSE AGREEMENT
This
Agreement is between ImaRx Therapeutics, a corporation of the
State
of Delaware, having a principal place of business at 1635 E. 18th
St., Tucson,
AZ 85718 (hereinafter referred to as "IMARX") and Dr. med. Reinhard
Schlief,
(hereinafter "DR. SCHLIEF"), having an address at Neue Strasse 21,
14163 Berlin,
Germany.
WITNESSETH:
WHEREAS,
DR. SCHLIEF owns certain intellectual property; and
WHEREAS,
IMARX is desirous of obtaining a license under the intellectual
property and wishes to acquire a license in order to utilize or
otherwise
commercialize the intellectual property; and
NOW,
THEREFORE, in consideration of the premises and the mutual
promises
and covenants hereinafter set forth, the parties hereby agree as
follows
ARTICLE 1 - DEFINITIONS
1.1
"PATENT RIGHTS" shall mean the U.S. patent 5,380,411, and assigned
to
DR. SCHLIEF, entitled "Ultrasound or Shock Wave Work Process and
Preparation for
Carrying Out Same" and the invention disclosed and claimed therein,
and all
continuations, divisions, and reissues based thereof, and any
corresponding
foreign patent applications (including Japan and EU countries), and
any patents,
patents of addition, or other equivalent foreign patent rights
issuing, granted
or registered thereon.
1.2
"LICENSED PRODUCT(S)" shall mean products or services using a
method
covered by a VALID CLAIM, on a country-by-country basis, that if
made, used,
sold, imported or offered for sale would constitute, but for the
license granted
to IMARX pursuant to this Agreement, an infringement of a VALID
CLAIM
(infringement shall include, but is not limited to, direct,
contributory, or
inducement to infringe).
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January 4, 2005
1.3 "NET
SALES" shall mean gross sales revenues received by IMARX,
AFFILIATED COMPANY and IMARX's sublicensees from the sale of
LICENSED PRODUCT(S)
less trade discounts allowed, refunds, returns and recalls, and
sales taxes. In
the event that IMARX, AFFILIATED COMPANY or IMARX's sublicensee
sells a LICENSED
PRODUCT(S) in combination with other ingredients or substances or
as part of a
kit, the NET SALES for purposes of royalty payments shall be based
on calculated
as follows:
(a) If all LICENSED PRODUCTS and
Other Items contained in the
combination are available separately, the NET SALES for purposes
of
royalty payments will be calculated by multiplying the NET SALES
of
the combination by the fraction A/A+B, where A is the
separately
available price of all LICENSED PRODUCTS in the combination, and
B
is the separately available price for all Other Items in the
combination.
(b)
If the
combination includes Other Items which are not sold
separately (but all LICENSED PRODUCTS contained in the
combination
are available separately), the NET SALES for purposes of
royalty
payments will be calculated by multiplying the NET SALES of the
combination by A/C, where A is as defined above and C is the
invoiced price of the combination.
(c)
If the LICENSED
PRODUCTS contained in the combination are not sold
separately, the NET SALES for such combination shall be NET SALES
of
such combination as defined in the first sentence of this
Paragraph
1.3. However, the parties agree to negotiate a reduction in the
royalty rate to reflect the fair value that the LICENSED
PRODUCT
attributed to the overall product sold, but in no event shall
the
royalty rates be reduced by greater than fifty percent (50%).
The term "Other Items" does not include solvents, diluents,
carriers,
excipients, buffers or the like used in formulating a product.
1.4 "VALID
CLAIM" shall mean a claim of an issued patent in PATENT RIGHTS
which has not lapsed or become abandoned or been declared invalid
or
unenforceable by a court of competent jurisdiction or an
administrative agency
from which no appeal can be or is taken.
1.5
"LICENSED FIELD" shall mean all fields.
1.6
"AFFILIATED COMPANY" or "AFFILIATED COMPANIES" shall mean any
corporation, company, partnership, joint venture or other entity
which controls,
is controlled by or is under common control with IMARX. For
purposes of this
Paragraph 1.6, control shall mean the
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January 4, 2005
direct or indirect ownership of at least fifty percent (50%).
1.7
"EXCLUSIVE LICENSE" shall mean a grant by DR. SCHLIEF to IMARX of
its
entire right and interest in the PATENT RIGHTS.
1.8
"EFFECTIVE DATE" of this License Agreement shall mean the date
the
last party hereto has executed this Agreement.
ARTICLE 2 - GRANTS
2.1
Subject to the terms and conditions of this Agreement, DR.
SCHLIEF
hereby grants to IMARX an EXCLUSIVE LICENSE to make, have made,
use, sell and
have sold the LICENSED PRODUCT(S) in the United States and
worldwide under the
PATENT RIGHTS in the LICENSED FIELD.
2.2
IMARX may
sublicense others under this Agreement and any sublicense
shall be consistent with the terms of this Agreement.
2.3
If for any
reason other than being sold to another company IMARX
ceases to exist, then patent rights shall return to DR. SCHLIEF.
In
the event that IMARX is sold to another company, the rights and
responsibilities assigned to IMARX in this Agreement will be
transferred to the company.
ARTICLE 3 - PATENT INFRINGEMENT
3.1 Each
party will notify the other promptly in writing when any
infringement by another is uncovered or suspected.
3.2 IMARX shall have
the right to enforce any patent within PATENT RIGHTS
in the LICENSED FIELD against any infringement or alleged
infringement thereof,
and shall keep DR. SCHLIEF informed as to the status thereof. IMARX
may, in its
sole judgment and at its own expense, institute suit against any
such infringer
or alleged infringer and control, settle, and defend
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January 4, 2005
such suit in a manner consistent with the terms and provisions
hereof and
recover, for its account, any damages, awards or settlements
resulting
therefrom.
3.3 If
IMARX elects not to enforce any patent within the PATENT
RIGHTS,
then it shall so notify DR. SCHLIEF in writing within six (6)
months of
receiving notice that an infringement exists, and DR. SCHLIEF may,
in his sole
judgment and at its own expense, take steps to enforce any patent
and control,
settle, and defend such suit in a manner consistent with the terms
and
provisions hereof, and recover, for his own account, any damages,
awards or
settlements resulting therefrom.
ARTICLE 4 - PAYMENTS, ROYALTY AND EQUITY
4.1 IMARX
will reimburse DR. SCHLIEF for certain past out-of-pocket costs
associated with PATENT RIGHTS including but not limited to
maintenance fees and
patent transfer fees up to the amount of $15,000.00 US Dollars.
IMARX shall
reimburse DR. SCHLIEF within thirty (30) days of receipt of invoice
from DR.
SCHLIEF. Such invoice shall provide copies of documentation from
patent
attorney's and patent offices or other acceptable documentation
detailing the
out-of-pocket patent costs incurred by DR. SCHLIEF. IMARX shall
also reimburse
future incurred expenses as detailed in Paragraph 5.1.
4.2 In
partial consideration for the license granted herein, IMARX
grants
DR.SCHLEIF warrants to purchase 20,000 shares of IMARX common stock
pursuant to
the COMMON STOCK WARRANT attached as Exhibit A.
4.3 IMARX
shall pay to DR. SCHLIEF, as a running royalty, for each
LICENSED PRODUCT sold by IMARX or AFFILIATED COMPANIES, two percent
(2%) of NET
SALES for the term of this Agreement. Should IMARX be required to
pay running
royalties on any patent rights not licensed hereunder ("Other
Royalties") in
order to make, use or sell a particular LICENSED PRODUCT, IMARX
shall be
entitled to credit half (50%) of such Other Royalties against the
running
royalty due, provided that the running royalties shall not be
reduced below
fifty percent (50%) of those that would otherwise be due DR.
SCHLIEF for that
LICENSED PRODUCT.
Such
payments shall be made twice per year as provided in Paragraph
4.5.
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January 4, 2005
4.4 In the
event IMARX grants a sublicense of rights to a third party
under this Agreement, IMARX shall pay DR. SCHLIEF three percent
(3%) of any
milestone payments or running royalties received by IMARX, for
sublicensing
PATENT RIGHTS. Research support to fund development of a LICENSED
PRODUCT,
patent cost or other out-of-pocket reimbursements or equity
investments made at
fair market value are excluded, however DR. SCHLIEF shall receive
three percent
(3%) of the excess above fair market value of any equity
investments. If any
Other Rights (Other Rights are rights other than PATENT RIGHTS that
are owned or
controlled by IMARX) are conveyed under a sublicense, the
percentage owed to DR.
SCHLIEF shall be based upon the valu
