EXHIBIT 10.2

 

ASSET PURCHASE AGREEMENT

 

THIS ASSET PURCHASE AGREEMENT (this “Agreement”) dated as of February 1, 2019
(the “Effective Date”), is entered into between HARROW HEALTH, INC., a Delaware
corporation (“Harrow”), with a place of business at 12264 El Camino Real, Suite
350, San Diego, California 92130, and Mayfield Pharmaceuticals, Inc., a Nevada
corporation (“Mayfield”), with a place of business at 12264 El Camino Real,
Suite 350, San Diego, California 92130. The parties hereby agree as follows:

 

1. Definitions. For the purposes of this Agreement, the following terms shall
have the respective meanings set forth below, and grammatical variations of such
terms shall have corresponding meanings:

 

1.1 “Affiliate” means, with respect to any Person, any other Person which
directly or indirectly controls, is controlled by, or is under common control
with, such Person. A Person shall be regarded as in control of another Person if
it owns, or directly or indirectly controls, more than fifty percent (50%) of
the voting stock or other ownership interest of the other Person, or if it
directly or indirectly possesses the power to direct or cause the direction of
the management and policies of the other Person by any means whatsoever.
Notwithstanding the foregoing, for purposes of this Agreement, neither Harrow
nor Mayfield shall be Affiliates of the other or the other’s Affiliates.

 

1.2 “Assets” means, collectively, (a) all Technology, (b) the Assigned Patent
Rights, (c) the Assigned Know-How Rights, and (d) all compositions,
formulations, samples, data and information specific to the Technology owned by
Harrow as of the Effective Date; in each case, acquired from Elle by Harrow
pursuant to the Elle APA.

 

1.3 “Assigned Know-How Rights” means all trade secret and other know-how rights
acquired from Elle by Harrow pursuant to the Elle APA.

 

1.4 “Assigned Patent Rights” means, collectively, (a) all patents and patent
applications (including provisional patent applications) acquired from Elle by
Harrow pursuant to the Elle APA, including those listed on Schedule A, together
with all divisionals, continuations and continuations-in-part that claim
priority to, or common priority with, the foregoing; (b) all patents issuing
therefrom (including utility models and design patents and certificates of
invention); (c) all reissues, reexaminations, inter partes reviews, renewals,
restorations, extensions and supplementary protection certificates of any of the
foregoing patent applications or patents; (d) all confirmation patents,
registration patents or patents of addition based on any of the foregoing
patents; and (e) all foreign counterparts of any of the foregoing, or as
applicable portions thereof.

 

1.5 “Confidential Information” means all information and data that (a) is
provided by one party to the other party under this Agreement, and (b) if
disclosed in writing or other tangible medium is marked or identified as
confidential at the time of disclosure to the recipient, is acknowledged at the
time of disclosure to be confidential, or otherwise should reasonably be deemed
to be confidential, except that the Assets shall be the Confidential Information
of both parties. Notwithstanding the foregoing, Confidential Information of a
party shall not include that portion of such information and data which, and
only to the extent, the recipient can establish by written documentation: (i) is
known to the recipient as evidenced by its written records before receipt
thereof from the disclosing party, (ii) is disclosed to the recipient free of
confidentiality obligations by a third person who has the right to make such
disclosure, (iii) is or becomes part of the public domain through no fault of
the recipient, or (iv) the recipient can reasonably establish is independently
developed by persons on behalf of recipient without access to or use of the
information disclosed by the disclosing party.

 

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1.6 “Dyspareunia Product” means any product, in any gel-based form or
formulation, containing lidocaine as an active pharmaceutical ingredient with a
concentration in the range of 3.18% to 4.40% for the treatment of dyspareunia.

 

1.7 “Elle” means Elle Pharmaceutical, LLC.

 

1.8 “Elle APA” means the Asset Purchase Agreement entered into between Elle and
Harrow on or around the Effective Date, as amended or restated from time to
time.

 

1.9 “FDA” means the United States Food and Drug Administration, or any successor
entity thereto.

 

1.10 “Harrow Field” means drug products compounded or manufactured in
compounding pharmacies or outsourcing facilities as defined and described in the
Federal Food, Drug & Cosmetic Act (21 U.S.C §353a and 21 U.S.C. §353b).

 

1.11 “Licensee” means a Third Party to whom Mayfield or its Affiliate has
granted a license, immunity or other right under the Assigned Patent Rights to
offer to sell, sell or otherwise commercialize one or more Dyspareunia Products,
provided such license has not expired or been terminated.

 

1.12 “Person” means any individual, partnership, firm, corporation, association,
trust, unincorporated organization or other entity, as well as any syndicate or
group of any of the foregoing.

 

1.13 “Product Supported Patent Rights” means, collectively, (a) all patent
applications hereafter filed anywhere in the world, together with all
divisionals, continuations and continuations-in-part that claim priority to, or
common priority with, the foregoing; (b) all patents issuing therefrom
(including utility models and design patents and certificates of invention); (c)
all reissues, reexaminations, inter partes reviews, renewals, restorations,
extensions and supplementary protection certificates of any of the foregoing
patent applications or patents; (d) all confirmation patents, registration
patents or patents of addition based on any of the foregoing patents; and (e)
all foreign counterparts of any of the foregoing, or as applicable portions
thereof; in each case that use or are supported by data or information derived
from the development, manufacture or use of a Dyspareunia Product or otherwise
from the exploitation of the Assets; provided, however, that Product Supported
Patent Rights shall exclude the Assigned Patent Rights.

 

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1.14 “Technology” means, collectively, (a) Dyspareunia Product, (b) all
compositions, components and formulations thereof, and (c) any and all methods
of manufacture and uses of the foregoing.

 

1.15 “Third Party” means any Person other than Harrow, Mayfield or their
respective Affiliates.

 

2. Purchase and Sale of the Assets.

 

2.1 Assets. Subject to the terms and conditions of this Agreement, Mayfield
hereby purchases from Harrow, and Harrow hereby sells, conveys, transfers and
assigns to Mayfield, on the Effective Date, all of Harrow’ right, title and
interest in and to the Assets. To the extent necessary to comply with applicable
privacy laws, Harrow shall have the right to redact patient identifying
information from any data or information transferred to Mayfield.

 

2.2 No Assumption of Liabilities. Mayfield shall not be obligated to assume or
perform and is not assuming or performing any liabilities or obligations of
Harrow which relate to Harrow’ ownership of the Assets prior to the Effective
Date or otherwise, whether known or unknown, fixed or contingent, certain or
uncertain, and regardless of when they are or were asserted, and Harrow shall
remain responsible for such liabilities.

 

2.3 Transfer Documents. The sale, conveyance, transfer and assignment of the
Assets may be further evidenced by the due execution and delivery by the parties
of any additional bills of sale, assignment or other title transfer documents
and instruments as reasonably requested by Mayfield evidencing the sale,
conveyance, transfer and assignment of the Assets in accordance with this
Agreement.

 

3. License Grants.

 

3.1 Grantback License.

 

3.1.1 Subject to the terms and conditions of this Agreement, Mayfield hereby
grants to Harrow an exclusive (including with respect to Mayfield), irrevocable,
perpetual, fully paid-up, royalty-free, non-transferable (except in connection
with a permitted assignment of this Agreement), worldwide license under the
Assigned Patent Rights, the Product Supported Patent Rights, and the Assigned
Know-How Rights for all purposes in the Harrow Field.

 

3.1.2 Harrow shall have the right to grant sublicenses, through multiple tiers,
to Third Parties and Affiliates.

 

3.2 No Implied Licenses. Only licenses and rights expressly granted herein shall
be of legal force and effect. No license or other right shall be created
hereunder by implication, estoppel, or otherwise.

 

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4. Representations and Warranties.

 

4.1 Mutual Representations and Warranties. Each party represents and warrants to
the other party as follows:

 

4.1.1 Organization. Such party is duly organized, validly existing and in good
standing under the laws of the jurisdiction in which it is organized.

 

4.1.2 Authorization and Enforcement of Obligations. Such party (a) has the
requisite power and authority and the legal right to enter into this Agreement
and to perform its obligations hereunder; and (b) has taken all requisite action
on its part to authorize the execution and delivery of this Agreement and the
performance of its obligations hereunder. This Agreement has been duly executed
and delivered on behalf of such party, and constitutes a legal, valid, binding
obligation, enforceable against such party in accordance with its terms.

 

4.1.3 Consents. All necessary consents, approvals and authorizations of all
governmental authorities and other persons or entities required to be obtained
by such party in connection with this Agreement have been obtained.

 

4.1.4 No Conflict. The execution and delivery of this Agreement and the
performance of such party’s obligations hereunder (a) do not conflict with or
violate any requirement of applicable laws, regulations or orders of
governmental bodies; and (b) do not conflict with, or constitute a default
under, any contractual obligation of such party.

 

4.2 Disclaimer of Warranties. EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN SECTION
4.1, NEITHER PARTY MAKES ANY REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED,
REGARDING THE ASSETS OR ANY OTHER MATTER, INCLUDING WITHOUT LIMITATION, ANY
REPRESENTATION OR WARRANTY REGARDING VALIDITY, ENFORCEABILITY, MERCHANTABILITY
OR FITNESS FOR A PARTICULAR PURPOSE OR NONINFRINGEMENT. THE ASSETS ARE PROVIDED
“AS IS.”

 

5. Financial Terms. As a condition precedent to the effect of this Agreement,
Mayfield shall enter into a written agreement with Elle, pursuant to which
Mayfield shall pay certain amounts to Elle on terms and conditions to be
mutually agreed by Mayfield and Elle.

 

6. Post-Effective Date Covenants.

 

6.1 Mayfield Covenants.

 

6.1.1 Mayfield shall use commercially reasonable efforts (whether alone or with
or through its Licensees or its or their respective Affiliates) to research,
develop and commercialize Dyspareunia Product.

 

6.1.2 Mayfield shall complete the closing of equity financing(s) of Mayfield
with net proceeds received by Mayfield of not less than ten million dollars
($10,000,000) by June 1, 2020.

 

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6.1.3 Mayfield shall control, at its sole expense, the preparation, filing,
prosecution, maintenance and enforcement of the Assigned Patent Rights
consistent with prudent business practices, and shall consider in good faith the
interests of Harrow.

 

6.1.4 Mayfield shall enter into a stock issuance agreement with Elle dated as of
the Effective Date and shall issue to Elle certain shares of common stock of
Mayfield to Elle pursuant to, and on the terms and conditions of, such stock
issuance agreement.

 

6.2 Harrow Covenants.

 

6.2.1 Within thirty (30) days after the Effective Date, Harrow shall transfer to
Mayfield all tangible embodiments of the Technology in the possession and
control of Harrow.

 

6.2.2 Harrow shall provide cooperation reasonably requested by Mayfield in
connection with Mayfield’s efforts to establish, perfect, defend, or enforce its
rights in or to the Assets (including without limitation the Assigned Patent
Rights). Such cooperation shall include, without limitation, (a) executing such
further assignments, transfers, licenses, releases and consents, and (b)
providing such data and information, consulting with Mayfield and executing and
delivering all such further documents and instruments, in each case as
reasonably requested by Mayfield regarding the Assets (including without
limitation the Assigned Patent Rights).

 

6.2.3 If a New Drug Application for a Dyspareunia Product is filed by or on
behalf of Mayfield and Mayfield (or its designee) receives all applicable
marketing and pricing approvals from the FDA regarding such New Drug
Application, then, commencing thirty (30) days after receipt by Harrow of
Mayfield’s express written request, Harrow shall cease compounding
pharmaceutical products for treatment of dyspareunia that contain the same
active ingredient as contained in such Dyspareunia Product in concentrations
between fifty percent (50%) and two hundred percent (200%) of the concentration
of such active ingredient in such Dyspareunia Product (or, if there is more than
one active ingredient contained in such Dyspareunia Product, then the same
combination of active ingredients in concentrations between fifty percent (50%)
and two hundred percent (200%) of the concentrations as contained in such
Dyspareunia Product) until such time as Mayfield, its Licensees and its or their
respective Affiliates (or their successors) cease for at least twelve (12)
months bona fide development or commercialization of such Dyspareunia Product.
Mayfield promptly shall notify Harrow in writing of any such cessation.

 

7. Indemnification.

 

7.1 Indemnification by Harrow. Subject to the provisions of this Section 7,
Harrow shall indemnify, defend and hold harmless Mayfield, its officers,
directors, affiliates, agents, stockholders and representatives (collectively,
the “Mayfield Indemnitees”), from and against any and all losses, liabilities,
damages and expenses (including without limitation reasonable attorneys’ fees
and costs) incurred as a result of any claim, demand, action or proceeding by
any Third Party (collectively, “Losses”) incurred or suffered by an Mayfield
Indemnitee to the extent arising out of:

 

7.1.1 any breach of the representations and warranties of Harrow set forth in
this Agreement;

 

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7.1.2 any breach of any covenant or agreement of Harrow set forth in this
Agreement or in any certificate, instrument, or other document delivered
pursuant to this Agreement; and

 

7.1.3 the ownership or exploitation of the Assets prior to the Effective Date.

 

7.2 Indemnification by Mayfield. Subject to the provisions of this Section 7,
Mayfield shall indemnify and hold harmless Harrow, its officers, directors,
affiliates, agents, stockholders and representatives (collectively, the “Harrow
Indemnitees”), from and against any and all Losses incurred or suffered by an
Harrow Indemnitee to the extent arising out of:

 

7.2.1 any breach of the representations and warranties of Mayfield set forth in
this Agreement;

 

7.2.2 any breach of any covenant or agreement of Mayfield set forth in this
Agreement or in any certificate, instrument, or other document delivered
pursuant to this Agreement;

 

7.2.3 the ownership or exploitation of the Assets after the Effective Date or
the manufacture, use, sale or other exploitation of any Dyspareunia Product
solely by Mayfield, its Licensees or their respective Affiliates or the use of
any Dyspareunia Product by their customers.

 

7.3 Procedure. A party seeking indemnification (the “Indemnitee”) shall promptly
notify the other party (the “Indemnifying Party”) in writing of a claim or suit;
provided that an Indemnitee’s failure to give such notice or delay in giving
such notice shall not affect such Indemnitee’s right to indemnification under
this Section 7 except to the extent that the Indemnifying Party has been
prejudiced by such failure or delay. The Indemnifying Party shall have the right
to control the defense of all indemnification claims hereunder. The Indemnitee
shall have the right to participate at its own expense in the claim or suit with
counsel of its own choosing. The Indemnifying Party shall consult with the
Indemnitee in good faith with respect to all non-privileged aspects of the
defense strategy. The Indemnitee shall cooperate with the Indemnifying Party as
reasonably requested, at the Indemnifying Party’s sole cost and expense. The
Indemnifying Party shall not settle any claim or suit without the Indemnitee’s
prior written consent, which consent shall not be unreasonably withheld.

 

8. Confidentiality.

 

8.1 Confidential Information. During the term of this Agreement, and for a
period of five (5) years following the expiration or earlier termination hereof,
except as otherwise provided in this Section 8, each party shall maintain in
confidence the Confidential Information of the other party except as expressly
permitted herein, and shall not use, disclose or grant the use of the
Confidential Information except on a need-to-know basis to those directors,
officers, employees, (sub)licensees and contractors, to the extent such
disclosure is reasonably necessary in connection with performing its obligations
or exercising its rights under this Agreement. To the extent that disclosure by
a party is authorized by this Agreement, prior to disclosure, such party shall
obtain agreement of any such Person to hold in confidence and not make use of
the Confidential Information for any purpose other than those permitted by this
Agreement.

 

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8.2 Terms of this Agreement. Neither party shall disclose any terms or
conditions of this Agreement to any Third Party without the prior consent of the
other party; provided, however, that a party may disclose the terms or
conditions of this Agreement, (a) on a need-to-know basis to its legal and
financial advisors to the extent such disclosure is reasonably necessary, and
(b) to a Third Party in in confidence in connection with (i) an equity
investment in such party, (ii) a merger, consolidation or similar transaction by
such party, (iii) a permitted (sub)license under this Agreement, or (iv) the
sale of all or substantially all of the assets of such party. Notwithstanding
the foregoing, prior to execution of this Agreement, the parties have agreed
upon the substance of information that can be used to describe the terms of this
transaction, and each party may disclose such information, as modified by mutual
agreement from time to time, without the other party’s consent.

 

8.3 Permitted Disclosures. The confidentiality obligations contained in this
Section 8 shall not apply to the extent that a party is required (a) in the
reasonable opinion of such party’s legal counsel, to disclose information by
applicable law, regulation, rule (including rule of a stock exchange or
automated quotation system), order of a governmental agency or a court of
competent jurisdiction or legal process, including tax authorities, or (b) to
disclose information to any governmental agency for purposes of obtaining
approval to test or market a product, provided in either case that, to the
extent practicable, such party shall provide written notice thereof to the other
party and sufficient opportunity to object to any such disclosure or to request
confidential treatment. Notwithstanding anything to the contrary herein, either
party may disclose the terms and conditions of this Agreement to any Person with
whom such party has, or is proposing to enter into, a business relationship, as
long as such Person has entered into a confidentiality agreement with such
party.

 

8.4 Injunctive Relief. Each party acknowledges that it will be impossible to
measure in money the damage to the other party if such party fails to comply
with the obligations imposed by this Section 8, and that, in the event of any
such failure, the other party may not have an adequate remedy at law or in
damages. Accordingly, each party agrees that injunctive relief or other
equitable remedy, in addition to remedies at law or damages, is an appropriate
remedy for any such failure and shall not oppose the granting of such relief on
the basis that the disclosing party has an adequate remedy at law. Each party
agrees that it shall not seek, and agrees to waive any requirement for, the
securing or posting of a bond in connection with the other party seeking or
obtaining such equitable relief.

 

9. Term and Termination.

 

9.1 Term. The term of this Agreement shall continue until expiration of all
payment obligations hereunder, unless earlier terminated as set forth below.

 

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9.2 Termination.

 

9.2.1 If Mayfield, its Licensees, or their respective Affiliates (a) fail to use
commercially reasonable efforts to develop and commercialize a Dyspareunia
Product within the United States, or thereafter to use reasonable efforts to
actively promote, market and sell such Dyspareunia Product within the United
States, or (b) fail to file an Investigational New Drug Application in the
United States for a Dyspareunia Product before the third (3rd) anniversary of
the Effective Date, then Mayfield shall provide written notice thereof to Harrow
and, unless the parties otherwise mutually agree in writing, Harrow shall have
the right to terminate the Agreement effective immediately upon written notice
of termination to Mayfield.

 

9.2.2 If Mayfield fails to receive net proceeds of the sale of its equity
securities to Third Parties of at least ten million dollars ($10,000,000) in
cash, whether individually or in the aggregate, by June 1, 2020, then (a)
Mayfield promptly shall provide written thereof to Harrow and (b) Harrow shall
have the right to terminate this Agreement immediately by providing Mayfield
with written notice of termination within thirty (30) days after Mayfield’s
notice described in clause (a).

 

9.2.3 In the event of the termination of this Agreement in accordance with this
Section 9.2, Mayfield promptly shall re-assign the Assets to Harrow or its
designee. Mayfield shall execute, acknowledge and deliver such further documents
and instruments and perform all such other acts as may be reasonably necessary
or appropriate in order to effectuate the foregoing.

 

9.3 Survival. Expiration or termination of this Agreement shall be without
prejudice to any rights which shall have accrued to the benefit of any party
prior to such expiration. Without limiting the foregoing, Sections 3, 4.2, 5, 7,
8, 9.2.3, 9.3, and 10 shall survive any expiration or termination of this
Agreement.

 

10. Miscellaneous.

 

10.1 Further Actions. Each party shall execute, acknowledge and deliver such
further documents and instruments and to perform all such other acts as may be
necessary or appropriate in order to carry out the purposes and intent of this
Agreement.

 

10.2 LIMITATION OF LIABILITY. IN NO EVENT SHALL A PARTY BE LIABLE FOR SPECIAL,
INCIDENTAL OR CONSEQUENTIAL DAMAGES ARISING OUT OF THIS AGREEMENT OR THE
EXERCISE OF ITS RIGHTS HEREUNDER, INCLUDING LOST PROFITS ARISING FROM OR
RELATING TO ANY BREACH OF THIS AGREEMENT, REGARDLESS OF ANY NOTICE OF SUCH
DAMAGES. NOTHING IN THIS SECTION 10.2 SHALL LIMIT OR RESTRICT THE RIGHTS OR
LIABILITIES OF EITHER PARTY UNDER SECTIONS 7 AND 8.

 

10.3 Residuals. Notwithstanding anything to the contrary in this Agreement,
Harrow shall have the right to use any general knowledge, skills and experience
and any information retained in the unaided memory of an individual employed or
otherwise engaged by Harrow.

 

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10.4 Assignment. Neither party shall assign its rights or obligations under this
Agreement without the prior written consent of the other party; provided,
however, that a party may, without such consent, assign this Agreement and its
rights and obligations hereunder (a) to any Affiliate, or (b) in connection with
the transfer or sale of all or substantially all of its business to which this
Agreement relates, or in the event of its merger, consolidation, change in
control or similar transaction. Any permitted assignee shall assume all
obligations of its assignor under this Agreement. Any purported assignment in
violation of this Section 10.4 shall be void.

 

10.5 Severability. Any provision of this Agreement which is illegal, invalid or
unenforceable shall be ineffective to the extent of such illegality, invalidity
or unenforceability, without affecting in any way the remaining provisions
hereof.

 

10.6 Governing Law; Exclusive Jurisdiction. This Agreement shall be governed by
and construed in accordance with the laws of the State of California, without
regard to the conflicts of law principles thereof. Each of the parties hereto
irrevocably consents to the exclusive jurisdiction and venue of any federal
court located in the Southern District of the State of California or state court
in San Diego, California having jurisdiction, in connection with any matter
based upon or arising out of this Agreement or the matters contemplated herein,
agrees that process may be served upon them in any manner authorized by laws of
the State of California for such persons and waives and covenants not to assert
or plead any objection which they might otherwise have to such jurisdiction,
venue and such process.

 

10.7 Entire Agreement; Amendment. This Agreement, together with the Schedules
hereto, and each additional document, instrument or other agreement to be
executed and delivered pursuant hereto constitute all of the agreements of the
parties with respect to, and supersede all prior agreements and understandings
relating to the subject matter of, this Agreement or the transactions
contemplated by this Agreement. This Agreement may not be modified or amended
except by a written instrument specifically referring to this Agreement signed
by the parties hereto.

 

10.8 Waiver. No waiver by one party of the other party’s obligations, or of any
breach or default hereunder by any other party, shall be valid or effective,
unless such waiver is set forth in writing and is signed by the party giving
such waiver; and no such waiver shall be deemed a waiver of any subsequent
breach or default of the same or similar nature or any other breach or default
by such other party.

 

10.9 Notices. Any consent, notice or report required or permitted to be given or
made under this Agreement by a party to the other party shall be in writing,
delivered by any lawful means to such other party at its address indicated
below, or to such other address as the addressee shall have last furnished in
writing to the addressor and (except as otherwise provided in this Agreement)
shall be effective upon receipt by the addressee.

 

  If to Harrow: Harrow Health, Inc.     12264 El Camino Real, Suite 350     San
Diego, California 92130     Attention: Chief Executive Officer

 

  If to Mayfield: Mayfield Pharmaceuticals, Inc.     12264 El Camino Real, Suite
350     San Diego, California 92130     Attention: Executive Director

 

10.10 Counterparts. This Agreement may be executed in separate counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.

 

[SIGNATURE PAGE FOLLOWS.]

 

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IN WITNESS WHEREOF, each party has caused a duly authorized representative to
execute and deliver this Asset Purchase Agreement as of the Effective Date.

 

  HARROW HEALTH, INC.       By: /s/ Mark Baum   Name: Mark Baum   Title: Chief
Executive Officer

 

  Mayfield Pharmaceuticals, Inc.       By: /s/ Andrew Boll   Name: Andrew Boll  
Title: Executive Director                 

 

[Signature Page to Asset Purchase Agreement] 

 

 

 

 

SCHEDULE A

 

Assigned Patent Rights

 

A-1