Document:

ex-10_10.htm

AFH Acquisition IV, Inc. 8-K

 

 

Exhibit 10.10

Joint Research and Development Agreement

 

This Agreement is made and entered into the 8th day of April, 2011 (“Effective Date”) by and between

 

CellSeed Inc., having a place of business at R-Bldg, Shinjuku IF, 33-8, Wakamatsu-cho, Shinjuku-ku, Tokyo 162-0056, Japan (“CELLSEED”)

 

on the one hand

 

and

 

Emmaus Medical, Inc. having a place of business at

20725 S. Western Ave., Suite 136, Torrance, CA 90501-1884

(“EMMAUS”)

 

on the other hand.

 

WHEREAS, EMMAUS has conducted research in the areas of regenerative medicine to develop certain products. From this regenerative medicine research initiative, EMMAUS is interested in assessing the products which have been or will be developed by CELLSEED, either alone or jointly with EMMAUS;

 

WHEREAS, CELLSEED possesses considerable expertise in research and development of cell sheet engineering regenerative medicine products. Using this expertise, CELLSEED has identified a number of product leads including Cultured Autologous Oral Mucosal Epithelial Cell-Sheet (CAOMECS), Cell-Sheet for Cardiac Muscle Regeneration, Regenerated Cartilage Sheet, and Cell-Sheet for Periodontal Tissue Regeneration; and,

 

WHEREAS, in order to advance these goals, EMMAUS and CELLSEED have detennined to enter into a relationship regarding the future research and development of the cell sheet engineering regenerative medicine products, and commercialization of such products. Particularly EMMAUS and CELLSEED are interested in the joint research and development of CAOMECS for generated medicine of cornea, CellSheet for Cardiac Muscle Regeneration, and Regenerated Cartilage Sheet.

 

NOW, THEREFORE, in consideration of the premises and of the mutual promises herein made and the mutual benefits to be derived from this Agreement, the parties agree as follows.

 

Article 1:   DEFINITIONS

 

	
1.1

	
“AFFILIATE” shall mean any corporation, partnership or other business organization which either party directly or indirectly controls or any company by which either party is controlled or is under common control with. For the purpose of this Agreement, “control” shall mean the holding of more than fifty percent (50%) of the voting stock or other ownership interest of the corporation or business entity involved.

 

  

1 / 13

  

	
1.2

	
“CELLSEED PATENTS” shall mean the patents and patent applications listed in an applicable INDIVIDUAL AGREEMENT and made a part thereof and any and all patents that may be issued from said patent applications, and all other patent applications and patents in the TERRITORY which CELLSEED presently or hereafter owns which pertain in any way to the manufacture, development, use or sale of the PRODUCTS including any and all divisions, continuations, continuations-in-part, extensions, substitutions, renewals, registrations, revalidations, reissues or additions of or to any of the aforementioned patents and patent applications.

 

	
1.3

	
“CONFIDENTIAL INFORMATION” shall mean any and all data and information proprietary or confidential nature that are owned or controlled by either party hereto and that is exchanged between EMMAUS and CELLSEED pursuant to this Agreement or an INDIVIDUAL AGREEMENT, or that are directly or indirectly related to a PRODUCT, or the manufacture, use or sale thereof, including, but without limitation to, KNOW-HOW, clinical or nonclinical data, compositions, production information, technical reports and specifications.

 

	
1.4

	
“DATA” has the meaning set forth in Article 9.5.

 

	
1.5

	
“INDIVIDUAL AGREEMENT” shall mean an agreement separately executed between the parties to determine the details, including, but not limited to, the work, and/or timeline, of the PROJECT. If any provision of this Agreement conflicts with that of an INDIVIDUAL AGREEMENT, the provision of the INDIVIDUAL AGREEMENT shall prevail.

 

	
1.6

	
“INTELLECTUAL PROPERTY RIGHT” has the meaning set forth in Article 9.1.

 

	
1.7

	
“JDC” has the meaning set forth in Article 4.1.

 

	
1.8

	
“JMC” has the meaning set forth in Article 4.2.

 

	
1.9

	
“KNOW-HOW” shall mean technical and scientific information and knowledge concerning any product of CELLSEED, including, but not limited to, information concerning the PRODUCTS, or any relevant information and knowledge for development, registration and marketing of any product of CELLSEED, including, but not limited to, physico-chemical and manufacturing data, specifications, quality control, and galenical, toxicological and pharmacological properties, available from CELLSEED.

 

	
1.10

	
“MARKETING APPROVAL” means the marketing authorization of the PRODUCTS granted by the competent authorities such as but not limited to the U.S. Food and Drug Administration.

 

	
1.11

	
“PRODUCTS” shall mean the regenerative medicines developed by CELLSEED and/or CELLSEED jointly with EMMAUS that are specified in the respective INDIVIDUAL AGREEMENT.

 

	
1.12

	
“PROJECT” shall mean a project and/or a task which is conducted under this Agreement and is identified in an INDIVIDUAL AGREEMENT.

 

  

2 / 13

  

	
1.13

	
“SPECIFICATIONS” shall mean the specifications and quality control requirements for the respective PRODUCTS as approved by the competent authorities in the TERRITORY, and modified from time to time following prior approval by the competent authorities in the TERRITORY.

 

	
1.14

	
“SUBSTRATES” shall mean CELLSEED temperature responsive cell culture substrates.

 

	
1.15

	
“TERRITORY” shall mean the United States of America.

 

	
1.16

	
The use herein of the plural shall include the singular, and the use of the masculine shall include the feminine and vice versa.

 

Article 2:   SCOPE OF THE PROJECT

 

Prior to the commencement of a PROJECT, both parties will execute an INDIVIDUAL AGREEMENT to determine the details of the PROJECT, including, but not limited to, the scope of the PROJECT, and each party’s respective responsibilities.

 

Article 3:   CONSIDERATION

 

In consideration of part of the research and development efforts made and expense borne by CELLSEED to date in order to develop the essential know-how and knowledge of Cell-Sheet Regenerative Medicine, all which are to be shared with EMMAUS under this Agreement and the first INDIVIDUAL AGREEMENT, EMMAUS will pay to CELLSEED $8,500,000 US Dollars within 30 days of the completion of all of the following: the fully signing of this Joint Research and Development Agreement; the fully signing of the INDIVIDUAL AGREEMENT dated April __ 2011 and relating to Cultured Autologous Oral Mucosal Epithelial CellSheets for generated medicine of cornea; and the delivery to EMMAUS by CELLSEED of CELLSEED’s accumulated information package (termed the “PACKAGE” in the INDIVIDUAL AGREEMENT).

 

Article 4:   COMMITTEES

 

	
4.1

	
For the purpose of successful development of PRODUCTS in the TERRITORY, a Joint Development Committee (“JDC”) comprised of an equal number of representatives from EMMAUS and CELLSEED shall be established. JDC will discuss and determine such matters as selection of clinical sites, developing key opinion leaders’ meeting, to obtain MARKETING APPROVAL in the TERRITORY for the PRODUCTS. Decisions regarding development and the conduct of JDC activities shall be made as follows:

 

	
  

	
(a)

	
The JDC shall be co-chaired by a representative from EMMAUS and CELLSEED. The JDC shall meet when either party has the need to do so; provided, however, the JDC shall meet at least twice (2) per year.

 

	
  

	
(b)

	
The JDC shall discuss and decide such items including, but not limited to, the structure and design of any additional clinical study if required for the purpose of obtaining MARKETING APPROVAL concerning PRODUCTS in the TERRITORY.

 

  

3 / 13

  

	
  

	
(c)

	
Decisions regarding development and the conduct of JDC activities shall be made by the unanimous vote of the JDC, with each company having one vote. Each party’s members in the JDC will reasonably consider the adoption of the other party’s suggestions and will accept as many of such suggestions as are reasonable.

 

	
  

	
(d)

	
If the JDC is unable to reach agreement on any decisions required of it, the issue shall be submitted for consideration in the case of EMMAUS to a designee of the Head of the Pharma Division of EMMAUS and in the case of CELLSEED to a designee of the Head of the Pharma Division of CELLSEED. If they are unable to agree, then the issue shall be resolved by the Head of the Pharma Division of CELLSEED.

 

	
  

	
(e)

	
A party may change any of its appointments to the JDC at any time upon giving written notice to the other party.

 

	
  

	
(f)

	
The JDC does not itself have the authority to amend this Agreement and/or any INDIVIDUAL AGREEMENT in any manner.

 

	
4.2

	
In order to guide the successful commercialization of PRODUCTS in the TERRITORY, a Joint Marketing Committee (“JMC”) will be established between the parties with the main purpose to oversee and approve all strategic marketing issues such as marketing objectives, marketing strategies, implementation and feedback. The authority of the JMC shall be limited to the TERRITORY.

 

	
  

	
(a)

	
The JMC shall be chaired by a representative from EMMAUS. The JMC shall meet when either party has the need to do so; provided, however, the JDC shall meet at least twice (2) per year.

 

	
  

	
(b)

	
Decisions regarding the marketing of the PRODUCTS shall be made by unanimous vote of the JMC with each company having one vote. Each party’s members of the JMC will reasonably consider the adoption of the other party’s suggestions and will accept as many of such suggestions as are reasonable.

 

	
  

	
(c)

	
If the JMC is unable to reach agreement on a decision required of it, the issue shall be submitted for consideration in the case of EMMAUS to a designee of the Head of the Pharma Division and in the case of CELLSEED to a designee of the Head of the Pharma Division. If they are unable to agree, then the issue shall be resolved by the Head of the Pharma Division of EMMAUS.

 

Article 5:   EXPLOITATION

 

	
5.1

	
Both parties shall comply with all relevant laws and regulations including but not limited to U.S. Food and Drug Administration Good Laboratory Practice and/or Good Manufacturing Practices.

 

  

4 / 13

  

Article 6:   TECHNOLOGY TRANSFER

 

	
6.1

	
CELLSEED shall transfer the cell sheet engineering technology and provide scientific and engineering support, training, and KNOW-HOW as agreed in the INDIVIDUAL AGREEMENT to EMMAUS so that EMMAUS may perform its obligation under this Agreement and relevant INDIVIDUAL AGREEMENT in effect.

 

Article 7:   EFFORTS

 

	
7.1

	
Both parties recognize that quick development and registration of the PRODUCTS as well as adequate promotional efforts to exploit the commercial potential of the PRODUCTS in an optimal way are in the mutual interest of both parties.

 

Article 8:   INTELLECTUAL PROPERTY AND INFRINGEMENT

 

	
8.1

	
CELLSEED shall defend and hold harmless EMMAUS against any suit, damage claim or demand based on actual or alleged infringements of any intellectual property of a third party resulting from the exercise or use of any right or license granted herein or under an INDIVIDUAL AGREEMENT which arises from the use, or sale, or the manufacture of the PRODUCTS within the TERRITORY.  The cost of such defense shall be borne by CELLSEED. CELLSEED may not settle any such third party claim without the consent of EMMAUS, which shall not be unreasonably withheld. Any suit, damage claim or demand based on actual or alleged infringements in the TERRITORY of any intellectual property of a third party resulting from changes to the PRODUCTS or the process by which they are made in the course of the joint development efforts by the parties shall be defended by the parties jointly. The parties shall negotiate to determine which party shall lead the defense and how the costs of defense should be allocated. Neither party may settle any such third party claim without the consent of the other party.

 

	
8.2

	
Each party shall promptly notify the other party of any suit, damage claim or demand based on any possible infringement of third party intellectual property arising from making, using or selling of the PRODUCTS.

 

	
8.3

	
In the event that either party becomes aware of a product made, used or sold in the TERRITORY which it believes to infringe a valid claim of issued CELLSEED PATENTS, each party shall promptly notify the other party, whereupon the parties shall consult with each other to determine which party, if any, should take action. Neither party may settle such claim or action without the consent of the other party. The parties shall also discuss how the expenses and any recoveries from such action should be treated. If one party does not agree to participate in such action, the other can take action at its own expense and shall be entitled to receive all recoveries.

 

	
8.4

	
CELLSEED shall be solely responsible for the prosecution and maintenance of the CELLSEED PATENTS relating to PRODUCTS (including, but not limited to, the PRODUCTS, manufacturing process and/or use thereof) in the TERRITORY during the term of this Agreement. CELLSEED shall grant, pursuant to the terms and conditions set

 

  

5 / 13

  

forth in the relevant INDIVIDUAL AGREEMENT, a license or other appropriate rights as necessary for EMMAUS to commercially make, use or sell the PRODUCTS to such relevant CELLSEED PATENTS to EMMAUS in the TERRITORY where CELLSEED PATENTS are granted. All expenses, including attorney’s fee, in connection with the prosecution and maintenance of the CELLSEED PATENTS shall be borne by CELLSEED.

 

	
8.5

	
CELLSEED shall notify EMMAUS of the issuance of each CELLSEED PATENT relevant to the PRODUCTS subject to any INDIVIDUAL AGREEMENT then effective, giving the date of issue and CELLSEED PATENT number for each such CELLSEED PATENT.

 

Article 9:   OWNERSHIP

 

	
9.1

	
All intellectual property rights in inventions and/or discoveries created in the course of this Agreement and each INDIVIDUAL AGREEMENT (the “INTELLECTUAL PROPERTY RIGHT”) shall be owned by both EMMAUS and CELLSEED jointly, under the terms and conditions that will be defined by EMMAUS and CELLSEED in a separate agreement, which shall also state which party shall be responsible for and shall pay the costs of applying for and prosecuting the patent application(s), and subsequent maintenance of the patent(s). Such jointly owned inventions and/or discoveries and related INTELLECTUAL PROPERTY RIGHT shall include those made jointly by the employee(s) of EMMAUS and CELLSEED, or solely made by the employee(s) of either party based on CONFIDENTIAL INFORMATION, INTELLECTUAL PROPERTY RIGHT and/or RIGHTS (as defined below) of the other party. CELLSEED and EMMAUS shall execute any documents required to perfect such joint ownership.

 

	
9.2

	
For intellectual property relating to the PRODUCTS under this Agreement or INDIVIDUAL AGREEMENT and made independently from CONFIDENTIAL INFORMATION, INTELLECTUAL PROPERTY RIGHT and/or RIGHTS of the other party and solely by employee(s) of one of the parties, the ownership of such intellectual property (“SOLELY OWNED INVENTION”) are held by the party whose employee(s) made the invention (“LICENSOR”) when LICENSOR obtains written confirmation of the other party that such SOLELY OWNED INVENTION does not include any of CONFIDENTIAL INFORMATION, INTELLECTUAL PROPERTY RIGHT and/or RIGHTS of the other party. Pursuant to the terms and conditions of this Agreement and respective INDIVIDUAL AGREEMENT(S), LICENSOR will grant a worldwide, perpetual, irrevocable, non-exclusive, royalty free, fully paid up, sub-licensable, transferable, license of rights (“LICENSE”) to the other party (“LICENSEE”) to make, use, sell, have made, offer for sale, have sold products incorporating or made using such SOLELY OWNED INVENTION and all other rights with regard thereto. In case LICENSEE desires the LICENSE to be exclusive, LICENSOR shall firstly discuss in good faith with LICENSEE the terms and conditions to such exclusive license.

 

	
9.3

	
Notwithstanding the provision in Article 9.1 through 9.2 above, any and all INTELLECTUAL PROPERTY RIGHTS in connection with SUBSTRATES shall solely

 

  

6 / 13

  

 

belong to CELLSEED. Any improvement of SUBSTRATES or process of production of the SUBSTRATES which is patentable shall solely belong to CELLSEED.

 

	
9.4.1

	
EMMAUS agrees to disclose promptly to CELLSEED any inventions, discoveries, improvements, works of authorship, copyrights, trade secrets, know-how and any equivalents thereof relating to the PRODUCTS (“EMMAUS INVENTIONS”) when arising.

 

	
9.4.2

	
Except for any inventions, discoveries or improvements in connection with SUBSTRATES, CELLSEED agrees to disclose promptly to EMMAUS any inventions, discoveries, improvements, works of authorship, copyrights, trade secrets, know-how and any equivalents thereof relating to the PRODUCTS (“CELLSEED INVENTIONS”) when arising.

 

	
9.4.3

	
Both parties acknowledge that EMMAUS INVENTION and CELLSEED INVENTION shall be deemed as CONFIDENTIAL INFORMATION and agree to treat them in compliance with Article 10 hereof.

 

	
9.5

	
Subject to the obligation of confidentiality under Article 10 hereof and the publication under Article 11 hereof, all data and results that are created in the course of this Agreement and/or each INDIVIDUAL AGREEMENT, excluding the INTELLECTUAL PROPERTY RIGHT (“DATA”) relating to the PRODUCTS, shall be owned by both EMMAUS and CELLSEED. CELLSEED may use DATA at its sole discretion for its research and business purpose outside the TERRITORY subject to the restrictions in the Article 11.2 below.

 

	
9.6

	
Each party shall retain all right, title and interest (collectively, “RIGHTS”) in any patent, patent application, trade secret, know-how and other intellectual property that was owned by such party prior to the date of this Agreement, or developed independently of this Agreement, and except for the licenses and rights granted herein and in a given INDIVIDUAL AGREEMENT with respect to the RIGHTS, no license grant or assignment, express or implied, by estoppel or otherwise with respect to the RIGHTS of a party, is intended by, or shall be inferred from, this Agreement.

 

Article 10:   CONFIDENTIALITY

 

	
10.1

	
Each party shall act diligently so as to prevent that any CONFIDENTIAL INFORMATION, received from the other, might be revealed or disclosed to a non-authorized third party. The obligation undertaken under this Article 10.1 shall survive for ten (10) years beyond the termination of the last INDIVIDUAL AGREEMENT executed under this Agreement. The receiving party may disclose CONFIDENTIAL INFORMATION to its AFFILIATE, provided that the receiving party shall impose the same degree of confidentiality on the AFFILIATE. Neither party shall use CONFIDENTIAL INFORMATION of the other party for any purpose other than to perform the obligations under this Agreement and/or any INDIVIDUAL AGREEMENT.

 

	
10.2

	
The obligations undertaken by the parties hereto pursuant to Article 10.1 shall not, in any event, apply to any information which

 

  

7 / 13

  

	
  

	
a)

	
at the time of disclosure is or thereafter becomes available to the public in published literature or otherwise through no fault of the receiving party;

	
  

	
b)

	
was known to, or otherwise in the possession of the receiving party prior to the receipt of such information from the other party as evidenced by the written records of the receiving party;

	
  

	
c)

	
is obtained by the receiving party from a third party who would not be breaching a commitment of confidentiality by disclosing such information;

	
  

	
d)

	
was independently developed by the receiving party’s employee who did not have access to the disclosed information; and,

	
  

	
e)

	
was disclosed in accordance with Article 11.

 

	
10.3

	
Each party recognizes that the other party may have in its possession or control information in respect of which it is bound by confidentiality obligations to a third party. For the avoidance of doubt, neither party shall be under any obligation to disclose to the other information in respect of which it is or reasonably considers itself to be bound by any such obligation.

 

	
10.4

	
The parties agree to co-operate in good faith to set up and maintain such organizational structures, safeguards and procedures as may be required to prevent disclosure by one party to the other, whether accidentally or otherwise, of any such information as is referred to in Article 10.3 above.

 

Article 11:   PUBLICITY AND PUBLICATION

 

	
11.1

	
CELLSEED and EMMAUS agree not to disclose any press release or other public statement disclosing the existence of or relating to this Agreement without the prior written consent of the other party, provided, however, that neither party shall be prevented from complying with any duty of disclosure (including SEC filing) it may have pursuant to securities or other applicable law and/or applicable regulation of stock exchanges.

 

	
11.2

	
If each party wishes to publish or present information generated in the course of performance of this Agreement and/or respective INDIVIDUAL AGREEMENT relating to the PRODUCTS in a scientific journal or conference proceeding, it shall furnish a copy of the proposed manuscript or presentation outline to the other party as soon as practicable, but in no event less than ninety (90) days before manuscript submission or the presentation date, to permit for the protection of such information, e.g. by filing of a patent application prior to such proposed disclosure.

 

Article 12:   INDEMNIFICATION

 

	
12.1

	
CELLSEED shall indemnify and hold EMMAUS, its AFFILIATES, and the officers, directors and employees of each of them, harmless from any and all liability, including liability for death or personal injury and reasonable attorney’s fees, which results:

	
  

	
a)

	
from the negligence or willful misconduct of CELLSEED;

	
  

	
b)

	
from the manufacture and/or packaging of PRODUCTS by CELLSEED.

  

8 / 13

  

	
  

	
c)

	
from the breach by CELLSEED of any covenant, representation or warranty contained in this Agreement and/or each INDIVIDUAL AGREEMENT, and if applicable; or,

	
  

	
d)

	
from CELLSEED’s or its assigned third party’s failure to manufacture the PRODUCTS in accordance with the SPECIFICATIONS.

 

	
12.2

	
EMMAUS shall indemnify and hold CELLSEED, its AFFILIATES and the officers, directors and employees of each of them, harmless from any and all liability, including liability for death or personal injury and reasonable attorney’s fees, which results:

	
  

	
a)

	
from the negligence or willful misconduct of EMMAUS with regard to the use of, and/or delivery and supply of, promotion, marketing, sale and distribution of the PRODUCTS;

	
  

	
b)

	
from the manufacture and/or packaging of PRODUCTS by EMMAUS if EMMAUS deviated from the applicable SPECIFICATIONS and instructions from CELLSEED;

	
  

	
c)

	
from the breach by EMMAUS of any covenant, representation or warranty contained in this Agreement and/or each INDIVIDUAL AGREEMENT and if applicable; or,

	
  

	
d)

	
from EMMAUS’s or its assigned third party’s failure to manufacture the PRODUCTS in accordance with the applicable SPECIFICATIONS.

 

Neither PARTY shall indemnify the other PARTY for any manufacture of any PRODUCT which is manufactured pursuant to SPECIFICATIONS developed jointly by the PARTIES pursuant to this AGREEMENT or INDIVIDUAL AGREEMENT.

 

	
12.3

	
The obligations of the indemnifying party under Article 12.1 and 12.2 are conditioned upon the prompt written notification to the indemnifying party of any of the aforementioned suits or claims. The indemnifying party shall have the right to assume the defense of any such suit or claim if it has assumed responsibility for the suit or claim, in writing; however, if in the reasonable judgment of the indemnified party, such suit or claim involves an issue or matter which could have a materially adverse effect on the business, operations or assets of the indemnified party, the indemnified party may control the defense or settlement thereof without waiving its right to seek indemnity for such claim. If the indemnified party defends the claim, the indemnified party may participate in the defense of such suit or claim at its sole cost and expense. There shall be no indemnification liability against a party as to any suit or claim for which settlement or compromise or an offer of settlement or compromise is made without the prior written consent of the indemnifying party.

 

	
12.4

	
Both parties shall carry policies of comprehensive general commercial liability and product liability insurance with respect to their obligations under this Agreement and/or each INDIVIDUAL AGREEMENT under ordinary terms and conditions, as well as under standard limits within the pharmaceutical industry. The existence of such policies shall be confirmed by either party upon request of the other party.

 

Article 13:   ASSIGNMENT

 

Neither this Agreement, nor any INDIVIDUAL AGREEMENT nor any rights or benefits or obligations hereunder or under any INDIVIDUAL AGREEMENT shall be assignable

 

  

9 / 13

  

or transferable by either of the parties hereto without the prior written consent of the other party, which shall not be unreasonably withheld, except that this Agreement may be assigned to an AFFILLIATE of a party, or this Agreement may be assigned to an acquirer of a party as a result of a change of control, merger, purchase of substantially all of the assets of a party or a similar event, without the consent of the other party.

 

Article 14:   TERM

 

	
14.1

	
This Agreement shall come into effect on the Effective Date and shall be valid until the date of the last to expire or terminated INDIVIDUAL AGREEMENT, unless earlier terminated by a party subject to the provisions of Article 15 hereunder. In case that neither party notifies the other party of its intention of non-renewal ninety (90) days prior to the expiration, this Agreement shall automatically be renewed for successive one (1) year terms.

 

	
14.2

	
If this Agreement is terminated, CELLSEED shall forthwith regain the right to sell PRODUCTS under its own trademark within the TERRITORY.

 

	
14.3

	
Article 8: INTELLECTUAL PROPERTY AND INFRINGEMENT, Article 9: OWNERSHIP, Article 10 CONFIDENTIALITY, Article 12: INDEMNIFICATION, Article 13: ASSIGNMENT, Article 16: GOVERNING LAW AND ARBITRATION, Article 18 : ENTIRE AGREEMENT; SEVERABILITY, Article 22: BINDING AGREEMENT shall survive the termination or expiration of this Agreement or the last INDIVIDUAL AGREEMENT.

 

Article 15:   TERMINATION

 

	
15.1

	
A party shall have a right to terminate this Agreement and/or INDIVIDUAL AGREEMENT(s) in effect by written notice to the other party upon the occurrence of any of the following events:

 

	
  

	
(a)

	
Breach by the other party of any material term or condition of this Agreement and/or INDIVIDUAL AGREEMENT(s) in effect, provided that the party in breach shall be notified in writing by the non-breaching party of such alleged breach, and shall have a period of sixty (60) days within which to rectify such breach.

 

	
  

	
(b)

	
In the event the other party is declared bankrupt or insolvent, or make an assignment for the benefit of its creditors, or if a receiver is appointed or any proceedings are commenced, voluntary or involuntary, by or against either party under any bankruptcy or similar law, and such status is not cured within thirty (30) days from its occurrence.

 

	
15.2

	
CELLSEED has the right to terminate this Agreement and/or INDIVIDUAL AGREEMENT(s) in effect, if during the term of this Agreement or INDIVIDUAL AGREEMENT (i) EMMAUS commercializes a regenerative product other than PRODUCTS which compete with PRODUCTS without express prior permission by CELLSEED, or (ii) besides (i) above, EMMAUS enters into partnership with one of the

 

  

10 / 13

  

competitors of CELLSEED who develops, manufactures, sells, and/ or distributes products which are similar to or have same functionality of the products developed, manufactured, and/or distributed by CELLSEED.

 

Article 16:   GOVERNING LAW AND ARBITRATION

 

	
16.1

	
This Agreement and/or respective INDIVIDUAL AGREEMENT shall be governed by and construed in accordance with the laws of the state of New York, exclusive of the choice of law rules thereof.

 

	
16.2

	
Other than matters within the responsibility of the JDC and JMC, for which the procedure of amicable settlement is described in the relevant articles, each party hereto agrees to settle any dispute and differences arising out of or in connection with this Agreement and/or respective INDIVIDUAL AGREEMENT, or the breach thereof, through good faith negotiation in an amicable manner. In the event a consensus cannot be obtained with regard to such dispute or breach, the Head of Pharma Division of CELLSEED and the Head of Pharma Division of EMMAUS shall discuss the matter and attempt to solve it. In case a mutually acceptable solution to such dispute or breach cannot be found, such dispute or breach shall be finally settled by arbitration pursuant to the Rules Conciliation and Arbitration of the International Chamber of Commerce as hereinafter provided by three (3) arbitrators appointed in the Rules and the decision of the arbitrators shall be final. Such arbitration shall take place in Wilmington, Delaware.

 

Article 17:   FORCE MAJEURE

 

Neither party shall be responsible nor liable to the other party for failure or delay in the performance of this Agreement and/or any INDIVIDUAL AGREEMENT (other than the obligation to make payments) due to any war, fire, accident, or other casualty, or any labor disturbance or act of God or the Public enemy, or any other contingency beyond such party’s reasonable control.

 

Article 18:   ENTIRE AGREEMENT; SEVERABILITY

 

	
18.1

	
This Agreement sets forth the entire agreement of the parties with respect to subject matter contained herein and supersedes and replaces any and all previous agreement between the parties on the subject matter. This Agreement may not be modified or amended except as expressly stated herein or by a written agreement duly executed by both parties hereto.

 

	
18.2

	
CELLSEED and EMMAUS hereby expressly state that it is the intention of neither party to violate any rule, law or regulation. If any of the provisions of this Agreement are held to be void or unenforceable with regard to the TERRITORY, then such void or unenforceable provisions shall be replaced with valid and enforceable provisions which will achieve as far as possible the economic business intentions of the parties.

 

  

11 / 13

  

Article 19:   INDEPENDENT CONTRACTOR

 

This Agreement or INDIVIDUAL AGREEMENT shall not be construed to constitute a partnership joint venture or agency relationship of any kind.

 

Article 20:   NOTICES

 

Any notice or communication required or permitted to be given or made under this Agreement by one of the parties hereto to the other shall be in writing and shall be deemed to have been sufficiently given or made for all purposes if mailed by registered mail, postage prepaid, addressed to such other party at its respective address as follows:

 

CELLSEED Inc.

R-Bldg, Shinjuku 1F, 33-8,

Wakamatsu-cho, Shinjuku-ku,

Tokyo 162-0056

Japan

Attn: Dr. Yukio Hasegawa, President & CEO

 

Emmaus Medical, Inc.

20725 S. Western Ave., Suite 136

Torrance, CA 90501-1884, U.S.A.

Attn: Dr. Yutaka Niihara, President & CEO

 

Article 21:   HEADINGS

 

The headings in this Agreement are for convenience only and shall not be considered in construing this Agreement.

 

Article 22:   BINDING AGREEMENT

 

This Agreement shall be binding on and inure to the benefit of the parties and their successors and permitted assignees.

 

Article 23:   NO THIRD PARTY BENEFIT

 

None of the provisions of this Agreement shall be for the benefit of or enforceable by any third party.

 

  

12 / 13

  

IN WITNESS WHEREOF, the parties hereto have caused this Agreement, through their duly appointed and authorized representatives, to be executed in duplicate as of the date executed by both parties.

 

 

	
Emmaus Medical, Inc.

 

Signed /s/ Yutaka Niihara                                        

 

Name  Yutaka Niihara

 

Title President and CEO

 

Date  April 8, 2011                                                     

	
CellSeed Inc.

 

Signed /s/ Yukio Hasegawa                                    

 

Name  Yukio Hasegawa

 

Title President and CEO

 

Date April 8, 2011                                                     

 

 

 

13 / 13ex-10_11.htm

AFH Acquisition IV, Inc. 8-K

 

 

Exhibit 10.11

 

Individual Agreement

 

This INDIVIDUAL AGREEMENT is made and entered into the 8th day of April, 2011 (“Effective Date”) by and between

 

CellSeed Inc., having a place of business at R-Bldg, Shinjuku 1F, 33-8, Wakamatsu-cho, Shinjuku-ku, Tokyo 162-0056, Japan (“CELLSEED”)

 

on the one hand

 

and

 

Emmaus Medical, Inc. having a place of business at

20725 S. Western Ave., Suite 136, Torrance, CA 90501-1884

(“EMMAUS”)

on the other hand.

WHEREAS, CELLSEED and EMMAUS have executed that certain JOINT RESEARCH AND DEVELOPMENT AGREEMENT dated April 8, 2011 (the “MASTER AGREEMENT”) for research and development of regenerative medicines;

 

WHEREAS, CELLSEED has accumulated and is the owner of valuable and confidential KNOW-HOW and CELLSEED PATENTS concerning the Cultured Autologous Oral Mucosal Epithelial Cell-Sheets for generated medicine of cornea; and,

 

WHEREAS, EMMAUS is also interested in being granted the rights provided hereunder to such Cultured Autologous Oral Mucosal Epithelial Cell-Sheets for generated medicine of cornea.

 

NOW, THEREFORE, pursuant to the MASTER AGREEMENT, in consideration of the premises and of the mutual promises herein made and the mutual benefits to be derived from this INDIVIDUAL AGREEMENT, the parties agree as follows.

 

Article 1: DEFINITIONS

 

Unless otherwise provided below, the capitalized term in this INDIVIDUAL AGREEMENT shall have the same meaning as defined in the MASTER AGREEMENT.

 

	
1.1

	
“CAOMECS” shall mean the Cultured Autologous Oral Mucosal Epithelial Cell-Sheets for generated medicine of cornea developed by CELLSEED or by CELLSEED jointly with EMMAUS (pursuant to this INDIVIDUAL AGREEMENT or the MASTER AGREEMENT) or otherwise under the CELLSEED PATENTS and/or KNOW-HOW owned by CELLSEED.

 

	
1.2

	
“cGMP” shall mean current good manufacturing practice which is issued by the U.S. Drug and Food Administration and which is applicable in the TERRITORY.

 

	
1.3

	
“MAA” shall mean a Marketing Authorization Application in the TERRITORY.

 

  

 

  

	
1.4

	
“MANUFACTURING COSTS” shall mean the costs borne by EMMAUS to manufacture the CAOMECS that is composed of the following cost elements:

 

Materials, utilities, labor, manufacturing-related overhead, non-manufacturing overhead to the extent specifically relating to the management of the manufacturing plant which CAOMECS is manufactured, insurance, tax, repairs, contracting-out expenses, depreciation of plants, properties and equipment, to the extent that they are actually used in the manufacturing of CAOMECS for the sales in the TERRITORY.

 

MANUFACTURING COSTS shall include the cost of obtaining biopsy from the patient if the aforementioned procedure is or will be included in the PRICE. MANUFACTURING COSTS shall also include the freight and handling costs associated with the biopsy and sales of CAOMECS.

Moreover, the tenn MANUFACTURING COSTS shall not include costs associated with the following elements:

 

	
  

	
a)

	
idle or excess capacity in case EMMAUS has established its own facility to manufacture CAOMECS;

 

	
  

	
b)

	
non-manufacturing overhead costs which do not specifically relate to the management of the manufacturing unit in which CAOMECS is manufactured, and overhead costs attributable to general corporate activities including, for example, executive management, investors relations, business development, legal affairs and finance;

 

	
  

	
c)

	
yield losses and NON-CONFORMING PRODUCT, to the extent such yield losses and NON-CONFORMING PRODUCT are resulting from failure or negligence of EMMAUS or its assigned manufacturer (for example due to identifiable errors of manufacturing);

 

	
  

	
d)

	
expired products; and,

 

	
  

	
e)

	
royalties payable to third parties in relation with the manufacturing, formulation, filling, use or sale of a CAOMECS.

 

	
1.5

	
“MARKETING APPROVAL” shall mean the marketing authorization of the CAOMECS granted by the U.S. Food and Drug Administration.

 

	
1.6

	
“NET SALES” shall mean the amount resulting from the total number of units of CAOMECS sold by EMMAUS in the TERRITORY to third parties multiplied by the PRICE less (i) deductions of returns (including withdrawals and recalls) allowed or credited, (ii) discounts (including volume–quantity discounts) and rebates (price reductions including chargebacks) granted at the time of invoicing and (iii) sales, excise (including Value Added Tax) and other taxes and governmental duties and charges (actual or retroactive) levied on the invoiced amount. The amount of such NET SALES shall be converted into USD at the average monthly rate of exchange at the time.

 

	
1.7

	
“NON CONFORMING PRODUCT’ shall mean CAOMECS that:

 

  

2 / 13

  

 

	
  

	
a)

	

does not meet the SPECIFICATIONS;

 

	
  

	
b)

	
was not manufactured or tested in accordance with the manufacturing procedures registered with the respective authorities; or,

 

	
  

	
c)

	
was not manufactured in accordance with cGMPs.

 

	
1.8

	
“PRICE” shall mean the net hospital price (to be paid by hospitals) per unit of CAOMECS in the TERRITORY.

 

	
1.9

	
“PRODUCT MARK” means any trademark, service mark, trade name, domain name and logo used on or in connection with the identification or marketing of CAOMECS.

 

	
1.10

	
“PROFIT” shall mean the net profit earned by EMMAUS computed by deducting MANUFACTURING COSTS from NET SALES of CAOMECS in the TERRITORY.

 

	
1.11

	
“PROJECT’ shall mean the commercialization of CAOMECS in the TERRITORY, under this INDIVIDUAL AGREEMENT.

 

	
1.12

	
“TERRITORY” shall mean the United States of America.

 

	
1.13

	
“TREATMENT IND” means treatment Investigational New Drug Application authorized by competent authority (a) when used for a patient suffering from a chronic, severe or life-threatening disease for which no satisfactory authorized alternative therapy exists or (b) when otherwise approved for use by a competent regulatory authority for use for an individual under a doctor’s care but prior to the receipt of marketing approval of the product for any use.

 

	
1.14

	
“USD” shall mean United States Dollars.

 

	
1.15

	
The use herein of the plural shall include the singular, and the use of the masculine shall include the feminine and vice versa.

 

Article 2: SCOPE OF RIGHTS

 

This INDIVIDUAL AGREEMENT must be signed on the same date the JOINT RESEARCH AND DEVELOPMENT AGREEMENT is signed.

 

	
2.1

	
Subject to all relevant terms and conditions of this INDIVIDUAL AGREEMENT, during the term of this INDIVIDUAL AGREEMENT, CELLSEED hereby grants EMMAUS an exclusive license and right to manufacture, sell, market and distribute CAOMECS under the CELLSEED PATENTS, RIGHTS, KNOW-HOW and other intellectual property held by CELLSEED in the TERRITORY.

 

During the term of this INDIVIDUAL AGREEMENT, CELLSEED and its AFFILIATES covenant and agree not to license the CELLSEED PATENTS to a third party in the TERRITORY, sell or distribute CAOMECS or authorize a third party to do

 

  

3 / 13

  

the same in the TERRITORY, or otherwise compete with EMMAUS with respect to CAOMECS in the TERRITORY.

 

	
2.2

	
In addition to the Article 2.1, only for the purpose to perform. the obligations under this INDIVIDUAL AGREEMENT, during the term of this INDIVIDUAL AGREEMENT, CELLSEED shall disclose and grant to EMMAUS the right to use the CELLSEED’s accumulated information package (“PACKAGE”), which is deemed necessary for the foundation of joint development of CAOMECS between the parties. Except to US Food and Drug Administration or competent government agency, EMMAUS shall not disclose and/or provide the entire and/or certain part of PACKAGE to any third party.

 

	
2.3

	
Except with respect to Japan and the areas where CELLSEED establishes any contractual relationship with any third party to manufacture, sell, market, and/or distribute CAOMECS, both parties shall discuss in good faith separately and determine the commercialization of CAOMECS outside the TERRITORY.

 

Article 3: CONSIDERATION

 

	
3.1

	
In consideration for the disclosure of the PACKAGE to EMMAUS as set forth in Article 2.2, EMMAUS shall pay to CELLSEED an amount of USD 1,500,000 in total. The payment shall be made by EMMAUS within thirty (30) days of the delivery of the PACKAGE.

 

	
3.2

	
EMMAUS may use, without any charge, CELLSEED PATENTS and other intellectual property held by CELLSEED for the development of CAOMECS as set forth in this INDIVIDUAL AGREEMENT. For the avoidance of doubt, EMMAUS shall not use CELLSEED PATENTS and other intellectual property held by CELLSEED for any purpose other than to perform its obligations under this or any other applicable INDIVIDUAL AGREEMENT.

 

	
3.3

	
The payment set out in Article 3.1 shall not be refundable in any cases.

 

Article 4: ROYALTY

 

	
4.1

	
In consideration for the rights granted to EMMAUS as set forth in Article 2.1, and for the right to use the PACKAGE as provided in Article 2.2, EMMAUS shall pay to CELLSEED royalty to be separately agreed by both parties. Both parties agree to discuss and determine the PROFIT sharing rate, which is equal to the percentage of PROFIT to be allocated to each of CELLSEED and EMMAUS taking into consideration the cost borne by each party through the phases provided in the Article 5 and of CELLSEED for research and development of CAOMECS outside the TERRITORY.

 

	
4.2

	
EMMAUS shall send a bi-annual sales report within thirty (30) days from the end of January and the end of June each year which shall set forth the budgeted NET SALES, the actual NET SALES, budgeted MANUFACTURING COST, the actual MANUFACTURING COST, budgeted PROFIT and the actual PROFIT and the amount of royalty thereon for the period for which royalty payment are made and deduction taken

 

  

4 / 13

  

	
  

	
in computing the PROFIT. The report shall be submitted even if no royalty payment is due.

 

	
4.3

	
The NET SALES used for determining applicable royalty formula shall be computed by the cumulative sales of CAOMECS from January 1st until December 31st of each calendar year.

 

	
4.4

	
Any discrepancy in the amount of royalty payable shall be settled in the next royalty settlement.

 

	
4.5

	
EMMAUS shall make royalty payment within sixty (60) days from receipt of invoice issued by CELLSEED.

 

	
4.6

	
The PRICE shall be established through discussion by both parties no later than sixty (60) days prior to the date of the inception of commercial sales of the CAOMECS in the TERRITORY and end of September in each year following the first year.

 

	
4.7

	
All royalty payments shall be payable in Japanese YEN to CELLSEED or its designee and shall be made by wire transfer of immediately available funds to financial institution designated by CELLSEED. Any bank charges imposed on the royalty payments shall be borne by EMMAUS, though EMMAUS shall not be held liable for any bank charges levied by the CELLSEED’s bank as the result of such payments.

 

	
4.8

	
Both parties agree to discuss in good faith and determine the terms and conditions to be submitted in TREATMENT IND of the CAOMECS.

 

Article 5: TECHNOLOGY TRANSFER

 

	
5.1

	
CELLSEED shall transfer its cell sheet engineering technology and provide scientific and engineering support, training and KNOW-HOW as agreed between the parties to EMMAUS so that EMMAUS may perform its obligation under this INDIVIDUAL AGREEMENT.

 

	
5.2

	
Commercialization

 

	
5.2.1

	
Marketing Approval

(a) EMMAUS shall obtain MARKETING APPROVAL for CAOMECS in the TERRITORY according to the schedule set out in the section (c) below, and shall maintain quality assurance and pharmacovigilance systems required by the competent authorities and/or under the applicable laws and regulations.

(b) In addition to the PACKAGE, CELLSEED shall provide to EMMAUS all necessary information which has been generated by or for CELLSEED to enable EMMAUS to make MAA filing for CAOMECS in the TERRITORY, if necessary. CELLSEED will provide support to EMMAUS in answering questions from authorities during the regulatory procedure and for post approval regulatory maintenance activities in the TERRITORY.

  

5 / 13

  

 

(c) EMMAUS shall use commercially reasonable efforts to perform its obligation hereunder according to the time schedule for the MARKETING APPROVAL for CAOMECS as set forth in Appendix 2 attached hereto (“PROJECT SCHEDULE”).

	
5.2.2

	
Development

The initial JDC shall be held in order to deliver the PACKAGE and shall commence the joint development between the parties.

 

EMMAUS shall diligently develop CAOMECS for sales in the TERRITORY with its own account. Any costs and expenses related directly or indirectly with the development of CAOMECS incurred in the TERRITORY shall be solely borne by EMMAUS.

 

	
5.2.3

	
Clinical Trial

EMMAUS shall conduct the clinical trial for the CAOMECS and shall also be responsible for the entire process, including, but not limited to, management of clinical research organization.

 

	
5.2.4

	
(a) CELLSEED will provide, free of charge to EMMAUS, UpCell-Inserts necessary for the technology transfer and development phase.

(b) In the process of preparation and start-up of the manufacturing site, the cost and expense accrued, except for the facilities and/or equipments, including but not limited to, provision of training and/or related standard operation procedures, shall be equally borne by each party.

(c) All of the cost and expense accrued in the process set out in the Articles 5.1 and 5.2 shall be borne by EMMAUS unless otherwise provided.

 

	
5.2.5

	
EMMAUS shall notify CELLSEED of the MARKETING APPROVAL for the CAOMECS in the TERRITORY. Such notice shall be given promptly, but in any event not later than ten (10) days after such grant or approval.

 

	
5.3

	
Both parties agree to separately execute the statement of works to determine the details, including, but not limited to, the work, and/or timeline, of the each phase provided in this Article 5 and manufacturing provided in Article 7.

 

	
5.4

	
All CELLSEED PATENTS relating to the manufacture, use and/or sale of CAOMECS in the TERRITORY shall be included on Appendix 1 to this INDIVIDUAL AGREEMENT. CELLSEED warrants that the list in this INDIVIDUAL AGREEMENT is a complete list of all such patents and patents applications for CAOMECS as of the Effective Date. From time to time during the term of this INDIVIDUAL AGREEMENT, CELLSEED will provide to EMMAUS, upon request, an updated version of such list.

 

Article 6:  MARKETING AND MARKETING PLANS

 

	
6.1.1

	
In the TERRITORY, EMMAUS retains the right to create and maintain own brand names/trademarks for CAOMECS. EMMAUS will on all promotional material and packaging acknowledge that the CAOMECS is distributed under a license from CELLSEED.

 

  

6 / 13

  

 

In the TERRITORY, EMMAUS may use the CELLSEED trademark, and any PRODUCT MARK owned by CELLSEED, in the marketing of the CAOMECS under this INDIVIDUAL AGREEMENT with CELLSEED’s prior permission; such permission shall not be unreasonably withheld.

 

	
6.1.2

	
In the TERRITORY, EMMAUS, after consultation with CELLSEED, shall develop the marketing strategies, tactics and sales forecasts for the CAOMECS which shall be reviewed by the JMC no less than twice (2) per year.

 

	
6.1.3

	
EMMAUS and CELLSEED shall jointly develop the training program for EMMAUS’s sales force in the TERRITORY under the guidance of JMC. EMMAUS shall utilize such training program to assure a consistent, focused promotional strategy and message.

 

	
6.2

	
EMMAUS in the TERRITORY may disseminate only those promotional and advertising materials for the CAOMECS that have been approved by CELLSEED for use in the TERRITORY, such approval shall not be unreasonably withheld. EMMAUS shall not make, and shall cause its employees, representatives and agents not to make, any claims or representations in respect of the CAOMECS in the TERRITORY that have not been approved by CELLSEED.

 

	
6.3

	
CELLSEED shall assist EMMAUS in the training of sales representatives, and, to the extent reasonable, such other matters as EMMAUS may request to enable EMMAUS to perform its promotion activities.

 

	
6.4

	
EMMAUS shall communicate with government authorities regarding CAOMECS, including, but not limited to, responding to inquiries about the CAOMECS and reporting adverse events occurred in the TERRITORY.

 

	
6.5

	
EMMAUS shall have the right to conduct additional clinical study for the CAOMECS in the TERRITORY as a part of the marketing plan for the purpose of promoting the sales of the CAOMECS in the TERRITORY. CELLSEED shall use its best commercial effort to assist such studies; provided, however, the cost for such study(s) shall be solely borne by EMMAUS.

 

	
6.6

	
Both parties are aware of the importance of timely and proper reporting of adverse events to health authorities as well as to the other party after commercial launch of the CAOMECS in the TERRITORY. In this regard both parties shall discuss and agree on the details of an adverse events reporting procedure soon after MAA has been filed in the TERRITORY, which must be in accordance with applicable law in the TERRITORY. The parties agree that all reports to each other shall be in English language.

 

 

  

7 / 13

  

 

 

Article 7: SUPPLY OF CAOMECS

 

	
7.1

	
EMMAUS shall be responsible to obtain biopsy of the patient’s own oral mucosal epithelial cells from the hospital in the TERRITORY for the purpose of manufacturing CAOMECS.

 

	
7.2

	
EMMAUS shall warrant that all CAOMECS shall be manufactured in accordance with cGMP and that it shall meet all the applicable SPECIFICATIONS. EMMAUS shall be responsible for the CAOMECS being shipped without any impairment of the applicable SPECIFICATIONS. Any shipment of CAOMECS shall include a certificate of analysis which shows full conformance of each CAOMECS with the applicable SPECIFICATIONS.

 

	
7.3

	
EMMAUS shall be responsible for handling all returns relating to the CAOMECS and all CAOMECS recalls within the TERRITORY.

 

Article 8: OWNERSHIP

 

Notwithstanding anything contrary to provisions of the MASTER AGREEMENT, each party shall retain all right, title and interest (collectively, “RIGHTS”) in any patent, patent application, trade secret, know-how and other intellectual property that was owned by such party prior to the date of this INDIVIDUAL AGREEMENT, or developed independently of this INDIVIDUAL AGREEMENT, and except for the licenses and rights granted herein and in a given INDIVIDUAL AGREEMENT with respect to the RIGHTS, no license grant or assignment, express or implied, by estoppel or otherwise with respect to the RIGHTS of a party, is intended by, or shall be inferred from, this INDIVIDUAL AGREEMENT.

 

Article 9: DATA RETENTION

 

EMMAUS shall be responsible for retention of all of DATA generated through the entire process provided in this INDIVIDUAL AGREEMENT as required by the applicable laws and regulation and/or separately instructed by CELLSEED. The archiving period shall expire on the later date whether provided by the applicable laws and regulation, or instructed by CELLSEED.

 

Article 10: MAINTENANCE OF RECORDS

 

	
10.1

	
EMMAUS shall maintain books and records of invoices relating to sales of the CAOMECS in the TERRITORY for three (3) years after issuance of the respective EMMAUS invoice to third parties, which are sufficient to enable CELLSEED to verify the NET SALES defined in Article 4.3 and PRICE defined in Article 4.6 of this INDIVIDUAL AGREEMENT.

 

	
10.2

	
CELLSEED may have an independent accountant reasonably acceptable for EMMAUS review and/or audit the relevant books and records relating to the CAOMECS of EMMAUS upon reasonable notice and not more than once each calendar year.

 

  

8 / 13

  

 

Article 11: TERM

 

	
11.1

	
This INDIVIDUAL AGREEMENT shall come into effect on the Effective Date written above and shall be valid until, unless earlier terminated by a party subject to the provisions of Article 15 of the MASTER AGREEMENT, until the CELLSEED PATENTS used for the CAOMECS expires in the TERRITORY.

 

	
11.2

	
Upon mutual agreement, the parties may extend the term of this INDIVIDUAL AGREEMENT. If the term is not extended, CELLSEED shall have the unlimited right to sell the CAOMECS under its own trademark within the TERRITORY.

 

	
11.3

	
Notwithstanding anything contrary in this INDIVIDUAL AGREEMENT, in case that EMMAUS fails to use commercially reasonable efforts to meet the PROJECT SCHEDULE, both parties shall discuss in good faith. In case that both parties cannot reach an agreement in a reasonable period through the said discussion, CELLSEED or EMMAUS may terminate this INDIVIDUAL AGREEMENT.

 

	
11.4

	
Article 8: OWNERSHIP, and Article 9: DATA RETENTION shall survive the termination or expiration of this INDIVIDUAL AGREEMENT. Article 10: MAINTENANCE OF RECORDS shall also survive in the term provided in respective articles.

 

Article 12: APPLICATION OF MASTER AGREEMENT

 

Unless otherwise provided in this INDIVIDUAL AGREEMENT, all the terms and conditions of MASTER AGREEMENT shall apply to this INDIVIDUAL AGREEMENT. If any provision of this INDIVIDUAL AGREEMENT conflicts with that of the MASTER AGREEMENT, the provision of this INDIVIDUAL AGREEMENT shall prevail.

 

Article 13: GOVERNING LAW AND ARBITRATION

 

	
13.1

	
This INDIVIDUAL AGREEMENT shall be governed by and construed in accordance with the laws of the state of New York, exclusive of the choice of law rules thereof.

 

	
13.2

	
Other than matters within the responsibility of the JDC and JMC, for which the procedure of amicable settlement is described in the relevant articles of the MASTER AGREEMENT, each party hereto agrees to settle any dispute and differences arising out of or in connection with this INDIVIDUAL AGREEMENT, or the breach thereof, through good faith negotiation in an amicable manner. In the event a consensus cannot be obtained with regard to such dispute or breach, the Head of Pharma Division of CELLSEED and the Head of Pharma Division of EMMAUS shall discuss the matter and attempt to solve it. In case a mutually acceptable solution to such dispute or breach cannot be found, such dispute or breach shall be finally settled by arbitration pursuant to the Rules Conciliation and Arbitration of the International Chamber of Commerce as hereinafter provided by three (3) arbitrators appointed in the Rules and the decision of the arbitrators shall be final. Such arbitration shall take place in Wilmington, Delaware.

 

  

9 / 13

  

 

 

Article 14: FORCE MAJEURE

 

Neither party shall be responsible nor liable to the other party for failure or delay in the performance of this INDIVIDUAL AGREEMENT (other than the obligation to make payments) due to any war, fire, accident, or other casualty, or any labor disturbance or act of God or the Public enemy, or any other contingency beyond such party’s reasonable control.

 

Article 15: ENTIRE AGREEMENT; SEVERABILITY

 

	
15.1

	
This INDIVIDUAL AGREEMENT and the MASTER AGREEMENT sets forth the entire agreement of the parties with respect to subject matter contained herein and supersedes and replaces any and all previous agreement between the parties on the subject matter. This INDIVIDUAL AGREEMENT may not be modified or amended except as expressly stated herein or by a written agreement duly executed by both parties hereto.

	
15.2

	
CELLSEED and EMMAUS hereby expressly state that it is the intention of neither party to violate any rule, law or regulation. If any of the provisions of this INDIVIDUAL AGREEMENT are held to be void or unenforceable with regard to any country of the TERRITORY, then such void or unenforceable provisions shall be replaced with valid and enforceable provisions which will achieve as far as possible the economic business intentions of the parties.

 

Article 16: NOTICES

 

Any notice or communication required or permitted to be given or made under this INDIVIDUAL AGREEMENT by one of the parties hereto to the other shall be in writing and shall be deemed to have been sufficiently given or made for all purposes if mailed by registered mail, postage prepaid, addressed to such other party at its respective address as follows:

 

CELLSEED Inc.

R-Bldg, Shinjuku 1F, 33-8,

Wakamatsu-cho, Shinjuku-ku,

Tokyo 162-0056

Japan

Attn: Dr. Yukio Hasegawa, President & CEO

Emmaus Medical, Inc.

20725 S. Western Ave., Suite 136

Torrance, CA 90501-1884, U.S.A.

Attn: Dr. Yutaka Niihara, President & CEO

 

  

10 / 13

  

 

Article 17: HEADINGS

 

The headings in this INDIVIDUAL AGREEMENT are for convenience only and shall not be considered in construing this INDIVIDUAL AGREEMENT.

 

Article 18: BINDING AGREEMENT

 

This INDIVIDUAL AGREEMENT shall be binding on and inure to the benefit of the parties and their successors and permitted assignees.

 

Article 19: NO THIRD PARTY BENEFIT

 

None of the provisions of this INDIVIDUAL AGREEMENT shall be for the benefit of or enforceable by any third party.

 

 

IN WITNESS WHEREOF, the parties hereto have caused this INDIVIDUAL AGREEMENT, through their duly appointed and authorized representatives, to be executed in duplicate as of the date executed by both parties.

 

 

	
Emmaus Medical, Inc.

 

Signed /s/ Yutaka Niihara                                        

 

Name  Yutaka Niihara

 

Title President and CEO

 

Date  April 8, 2011                                                     

	
CellSeed Inc.

 

Signed /s/ Yukio Hasegawa                                    

 

Name  Yukio Hasegawa

 

Title President and CEO

 

Date April 8, 2011                                                     

 

  

11 / 13

  

Appendix 1

 

 

 

Publication number: US 2006/0240552

Publication date: 2006/10/26

Application number: 10/544,542

Legal status: under examination

Title: ANTERIOR OCULAR-ASSOCIATED CELL SHEET, THREE-DIMENSIONAL CONSTRUCT AND PROCESS FOR PRODUCING THE SAME

Inventor: Masayuki Yamato, Teruo Okano

Applicant: CellSeed Inc.

Publication number: US 2004/0028657

Publication date: 2004/2/12

Application number: 10/333,468

Legal status: under examination

Title: CULTURED EPIDERMAL CELL SHEET, LAMINATED CULTURED SKIN SHEET AND PROCESS FOR PRODUCING THE SAME

Inventor: Teruo Okano, Masayuki Yamato, Mika Utsumi, Ai Kushida, Chie Konno, Akihiko Kikuchi

Applicant: CellSeed Inc.

Publication number: US 2006/0234377

Publication date: 2006/10/19

Application number: 10/544,541

Legal status: under examination

Title: CELL SHEETS FOR ECTOCORNEA FORMATION, METHOD OF PRODUCING THE SAME AND METHOD OF USING THE SAME

Inventor: Teruo Okano, Kohji Nishida, Masayuki Yamato

Applicant: CellSeed Inc. / Kohji Nishida

 

  

12 / 13

  

Appendix 2

 

Cultured Autologous Oral Mucosal Epithelial Cell-Sheets for generated medicine of cornea

 

	
  

	
●

	
IND Open

	
the year of 2012

	
  

	
●

	
Clinical Trial Completion

	
the year of 2013

	
  

	
●

	
NDA

	
the year of 2014

	
  

	
●

	
Marketing Authorization

	
the year of 2015

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00188-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00188-of-00352.parquet"}]]