Document:

Exhibit 4(a)(2)

 

"CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTIONS OF THIS DOCUMENT IDENTIFIED BY *** HAVE BEEN OMITTED AND HAVE BEEN SEPARATELY FILED WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS."

 

Exclusive Licence & Collaboration Agreement

 

Progen Pharmaceuticals Limited

PGL

 

Medigen Biotechnology Corp.

MBC

 

Clayton Utz

Lawyers

Level 28 Riparian Plaza  71 Eagle Street  Brisbane QLD  4000  Australia

GPO Box 55 Brisbane  QLD  4001

T + 61 7 3292 7000 F + 61 7 3221 9669

 

www.claytonutz.com

 

Our reference 15314/12192/80106309

 

 

Table of contents

 

	
1.
  	
Definitions and interpretations
  	
3
  
	
 
  	
 
  	
 
  
	
 
  	
1.1
  	
Definitions
  	
3
  
	
 
  	
1.2
  	
Interpretation
  	
5
  
	
 
  	
 
  	
 
  	
 
  
	
2.
  	
Term of the agreement
  	
6
  
	
 
  	
 
  	
 
  
	
3.
  	
Licence of PGL IP
  	
6
  
	
 
  	
 
  	
 
  
	
 
  	
3.1
  	
Exclusive Licence
  	
6
  
	
 
  	
3.2
  	
Supply of Product for trials
  	
7
  
	
 
  	
 
  	
 
  	
 
  
	
4.
  	
Developed IP
  	
8
  
	
 
  	
 
  	
 
  
	
 
  	
4.1
  	
Developed IP Owned by MBC
  	
8
  
	
 
  	
4.2
  	
Rights to IP developed by PGL
  	
8
  
	
 
  	
 
  	
 
  	
 
  
	
5.
  	
Sublicensing
  	
8
  
	
 
  	
 
  	
 
  
	
 
  	
5.1
  	
Liability for sublicensee
  	
8
  
	
 
  	
 
  	
 
  	
 
  
	
6.
  	
Licence fees
  	
8
  
	
 
  	
 
  	
 
  
	
7.
  	
Royalties
  	
9
  
	
 
  	
 
  	
 
  
	
 
  	
7.1
  	
Royalties where valid Patent
  	
9
  
	
 
  	
7.2
  	
Royalties where no Patent
  	
9
  
	
 
  	
7.3
  	
Reports
  	
9
  
	
 
  	
7.4
  	
Accrual and payment of royalties
  	
10
  
	
 
  	
 
  	
 
  	
 
  
	
8.
  	
MBC to Exploit
  	
10
  
	
 
  	
 
  	
 
  
	
 
  	
8.1
  	
MBC to produce Products
  	
10
  
	
 
  	
8.2
  	
Commencement of Phase 3 Trial
  	
10
  
	
 
  	
8.3
  	
Exploitation of Products
  	
11
  
	
 
  	
8.4
  	
Quality
  	
11
  
	
 
  	
8.5
  	
Notification of adverse event
  	
11
  
	
 
  	
8.6
  	
Insurance
  	
11
  
	
 
  	
 
  	
 
  	
 
  
	
9.
  	
Protection of Intellectual Property
  	
11
  
	
 
  	
 
  	
 
  
	
 
  	
9.1
  	
Notification of infringement
  	
11
  
	
 
  	
9.2
  	
Infringement of PGL IP
  	
12
  
	
 
  	
9.3
  	
Maintenance of IP
  	
12
  
	
 
  	
 
  	
 
  	
 
  
	
10.
  	
Warranties and indemnities
  	
13
  
	
 
  	
 
  	
 
  	
 
  
	
 
  	
10.1
  	
PGL warranties
  	
13
  
	
 
  	
10.2
  	
Exclusion of warranties
  	
13
  
	
 
  	
10.3
  	
MBC’s acknowledgments
  	
13
  
	
 
  	
10.4
  	
MBC to indemnify PGL
  	
13
  
	
 
  	
10.5
  	
PGL to indemnify MBC
  	
14
  
	
 
  	
10.6
  	
Liability for costs of Infringement Claim
  	
14
  
	
 
  	
10.7
  	
General mutual representations and warranties
  	
14
  
	
 
  	
10.8
  	
Indemnities
  	
14
  
	
 
  	
 
  	
 
  	
 
  
	
11.
  	
Confidentiality
  	
15
  
	
 
  	
 
  	
 
  	
 
  
	
 
  	
11.1
  	
No use or disclosure
  	
15
  
	
 
  	
11.2
  	
Further obligations
  	
15
  
	
 
  	
11.3
  	
Legal requirements
  	
15
  
	
 
  	
11.4
  	
Return of Confidential Information
  	
16
  

 

1

 

	
 
  	
11.5
  	
Retention for legal advice
  	
16
  
	
 
  	
11.6
  	
Survival of clause
  	
16
  
	
 
  	
 
  	
 
  	
 
  
	
12.
  	
Audit
  	
16
  
	
 
  	
 
  	
 
  
	
 
  	
12.1
  	
Records
  	
16
  
	
 
  	
12.2
  	
Audit
  	
16
  
	
 
  	
12.3
  	
Security
  	
17
  
	
 
  	
12.4
  	
Co-operation
  	
17
  
	
 
  	
12.5
  	
Copies of materials
  	
17
  
	
 
  	
12.6
  	
Costs of the Audit
  	
17
  
	
 
  	
 
  	
 
  	
 
  
	
13.
  	
Termination
  	
17
  
	
 
  	
 
  	
 
  
	
 
  	
13.1
  	
Reasons for termination by either party
  	
17
  
	
 
  	
13.2
  	
Reasons for termination by PGL
  	
17
  
	
 
  	
13.3
  	
Consequences of termination
  	
17
  
	
 
  	
13.4
  	
Accrued rights and survival
  	
18
  
	
 
  	
 
  	
 
  	
 
  
	
14.
  	
Dispute resolution
  	
18
  
	
 
  	
 
  	
 
  
	
 
  	
14.1
  	
Negotiation
  	
18
  
	
 
  	
14.2
  	
Referral to arbitration
  	
18
  
	
 
  	
 
  	
 
  	
 
  
	
15.
  	
Arbitration
  	
18
  
	
 
  	
 
  	
 
  
	
 
  	
15.1
  	
Reference to arbitration
  	
18
  
	
 
  	
15.2
  	
General principles
  	
19
  
	
 
  	
15.3
  	
Expedited proceedings
  	
19
  
	
 
  	
15.4
  	
Consolidation
  	
19
  
	
 
  	
15.5
  	
Award final and binding
  	
19
  
	
 
  	
15.6
  	
Governing law of arbitration agreement
  	
20
  
	
 
  	
 
  	
 
  	
 
  
	
16.
  	
Force Majeure
  	
20
  
	
 
  	
 
  	
 
  
	
 
  	
16.1
  	
Event of Force Majeure
  	
20
  
	
 
  	
16.2
  	
Remedy of Force Majeure
  	
20
  
	
 
  	
16.3
  	
Termination for extended Force Majeure
  	
20
  
	
 
  	
16.4
  	
Extension of Term
  	
20
  
	
 
  	
 
  	
 
  	
 
  
	
17.
  	
Notices
  	
20
  
	
 
  	
 
  	
 
  
	
18.
  	
General
  	
21
  
	
 
  	
 
  	
 
  
	
 
  	
18.1
  	
Governing law
  	
21
  
	
 
  	
18.2
  	
Jurisdiction
  	
21
  
	
 
  	
18.3
  	
Assignment
  	
22
  
	
 
  	
18.4
  	
Amendments
  	
22
  
	
 
  	
18.5
  	
Waiver
  	
22
  
	
 
  	
18.6
  	
Further acts and documents
  	
22
  
	
 
  	
18.7
  	
No representation or reliance
  	
22
  
	
 
  	
18.8
  	
Expenses
  	
22
  
	
 
  	
18.9
  	
Entire agreement
  	
22
  
	
 
  	
18.10
  	
Sub-contracting
  	
23
  
	
 
  	
18.11
  	
Relationship of the parties
  	
23
  
	
 
  	
18.12
  	
Remedies cumulative
  	
23
  
	
 
  	
18.13
  	
Severability of provisions
  	
23
  
	
 
  	
18.14
  	
Change in control
  	
23
  
	
 
  	
18.15
  	
Publicity
  	
23
  
	
 
  	
18.16
  	
Counterparts
  	
23
  
	
 
  	
 
  	
 
  	
 
  
	
Schedule 1 - PGL IP
  	
24
  

 

2

 

Exclusive Licence & Collaboration Agreement made on 2010

 

Parties                                                                                         Progen Pharmaceuticals Limited, ABN 82 010 975 612 of 16 Benson St, Toowong, Queensland, 4066, Australia (“PGL”)

 

Medigen Biotechnology Corp. of 114F, No.3, Yuancyu St., Nangang District, Taipei City 11560, Taiwan (R.O.C.) (“MBC”)

 

Introduction

 

A.                                                   PGL is the holder of patent and other intellectual property rights in a multi-targeted cytostatic cancer therapeutic product known as PI-88, a mixture of highly sulfated, monophosphorylated, mannose oligosaccharides.

 

B.                                                     MBC is a biotechnology company based in Taiwan that has been involved with drug development in the area of cancer therapeutics for over 10 years.

 

C.                                                     MBC has offered to enter into an exclusive licensing and collaboration arrangement for the further development and worldwide commercialisation of PI-88.

 

D.                                                    Prior to entering into this agreement, MBC has had access to documentation and PGL personnel in order to carry out due diligence on PGL and the intellectual property surrounding PI-88.

 

E.                                                      Prior to entering into this agreement, PGL has had access to documentation and MBC personnel in order to carry out due diligence on MBC and to evaluate MBC’s likely capability to exploit PI-88 on the terms and conditions of this agreement.

 

F.                                                      Pursuant to the terms and conditions contained in this agreement, PGL licenses MBC to develop, manufacture, use, sell, market and sublicense the product known as PI-88 in exchange for the licence fees and royalties set out in this agreement.

 

Operative provisions

 

1.                                                      Definitions and interpretations

 

1.1                                               Definitions

 

The following definitions apply unless the context requires otherwise.

 

Affiliate means with respect to a party, any corporation or other business entity directly or indirectly controlling, controlled by or under common control with such party, where control means possession of the power to direct, or cause the direction of the management and policies of a corporation or other entity whether through ownership of voting securities, by contract or otherwise and includes without limitation any related body corporate of a party as defined under section 50 of the Corporations Act 2001 (Cth).  For the purpose of this agreement, MBC and PGL are not Affiliates of one another.

 

ASX means the Australian Stock Exchange.

 

Commencement Date means 1 July 2010.

 

Confidential Information means all confidential and proprietary information, know how and trade secrets of a party (including, without limitation, the terms of this agreement, all business or financial information, all information, techniques, research and development results, test 

 

3

 

results and other technical and scientific information  that relates to the PGL IP or the MBC Developed IP, biological materials and samples relating to any Product, medical chemical and other scientific data, processes and analytic methodology used in the development, testing, clinical trials and analysis of any Product, and packaging, manufacturing, advertising and marketing data relating to the Product) but excluding any information which:

 

(a)                                                   was in the public domain at the time of its disclosure;

 

(b)                                                  came into the hands of the receiving party by lawful means and without breach of any obligation of confidentiality by any third party; or

 

(c)                                                   was in fact known lawfully by the receiving party prior to its disclosure to that party.

 

End User means a third party which is supplied a Product but does not distribute, resell or otherwise supply the Product to others (other than patients) in all countries in the Territory.

 

Event of Insolvency means:

 

(a)                                                   filing by a Party in any court pursuant to any statute of a petition in bankruptcy or insolvency, or for reorganization or arrangement, or for the appointment of a receiver of all or a portion of the Party’s property;

 

(b)                                                  the filing against a Party of any such petition, or the commencement of a proceeding for the appointment of a trustee, receiver or liquidator for the Party, or of any of the property of the Party, or a proceeding by any governmental authority for the dissolution or liquidation of the Party, if such proceeding shall not be dismissed or trusteeship discontinued within  ten (10) days after commencement of such proceeding or the appointment of such trustee or receiver;

 

(c)                                                   the making by a Party of an assignment for the benefit of creditors; or

 

(d)                                                  a Party is or admits in writing that it is, or is taken under any applicable law to be, insolvent or unable to pay its debts.

 

Exploit includes:

 

(a)                                                   in respect of a product - to make, hire, market, sell or otherwise dispose of it, offer to make, sell, hire or otherwise dispose of it, use it, import or export it, modify, improve or keep it for the purpose of doing any of those things; or

 

(b)                                                  in respect of a method or process - use the method or process, improve or modify the process or do any act mentioned in paragraph (a) in respect of a product resulting from such use,

 

and Exploitation has a corresponding meaning.

 

Field means the therapeutic and prophylactic treatment of cancer.

 

Force Majeure means a natural or man made disaster such as fire, earthquake, flood, storm, or explosion, or any , war (declared or undeclared)or any unavailability or delay in availability of equipment or transport..

 

Government Agency  means any government or governmental, semi-governmental, administrative, fiscal or judicial body, department, commission, authority, tribunal, agency or entity including, without limitation, the US FDA.

 

4

 

Intellectual Property  includes all present and future rights in relation to copyright, industrial and intellectual property rights of whatever nature in whatever country, including without limitation all rights in relation to Confidential Information, inventions, innovations, plant varieties, registered and unregistered patents, registered and unregistered trade marks (including service marks), registered designs, and circuit layouts, and all other rights resulting from intellectual activity in the industrial, scientific, literary or artistic fields whether created before or after the Commencement Date.

 

MBC Developed IP means all Intellectual Property developed or otherwise coming into existence directly as a result of or in the course of MBC carrying out this agreement (including any new patents) but, for the avoidance of doubt, excludes all PGL IP.

 

Net Sales  means the full invoice price plus the value of any other consideration paid or given by any person (including by contra arrangements, product swaps or other arrangements) for Products sold by MBC, its Affiliates and sublicensees to End Users less:

 

(a)                                                      any discounts given to End Users;

 

(b)                                                     sales and excise taxes, customs duty, or  other compulsory payments to Government Agencies, to the extent included in the invoice price,  provided they are actually paid or deducted and relate to the sale; and

 

(c)                                                      credits given to End Users for rejects or returns of Products.

 

PGL IP means the Intellectual Property owned or licensed by PGL which is necessary to Exploit the product known as PI-88 and includes the patents and patent applications set out in Schedule 1 and the Confidential Information of PGL related to those patents and patent applications. For the avoidance of doubt, PGL IP does not include any Intellectual Property relating to PGL’s PG500 series compounds.

 

Products means any products produced from or based on the PGL IP, including improvements, modifications and variations made by MBC or its Affiliates during the Term.

 

Term means the period commencing on the Commencement Date and expiring 15 years after the Commencement Date, unless earlier terminated in accordance with this agreement.

 

Territory  means the world.

 

US FDA means the United States Food and Drug Administration.

 

1.2                                               Interpretation

 

In this agreement:

 

(a)                                                   headings are for convenience only and do not affect interpretation,

 

and unless the context indicates a contrary intention:

 

(b)                                                  an obligation or liability assumed by, or a right conferred on, 2 or more persons binds or benefits them jointly and severally;

 

(c)                                                   “person” includes an individual, the estate of an individual, a corporation, an authority, an association or a joint venture (whether incorporated or unincorporated), a partnership and a trust;

 

(d)                                                  a reference to a party includes that party’s executors, administrators, successors and permitted assigns, including persons taking by way of novation and, in the case of a 

 

5

 

                                                                 trustee, includes a substituted or an additional trustee and further includes any person claiming on behalf of or under or through a party to this agreement;

 

(e)                                                   a reference to a document (including this agreement) is to that document as varied, novated, ratified or replaced from time to time;

 

(f)                                                     a reference to a statute or statutory provision includes a statutory modification or re-enactment of it or a statutory provision substituted for it, and each ordinance, by-law, regulation, rule and statutory instrument (however described) issued under it;

 

(g)                                                  a word importing the singular includes the plural (and vice versa), and a word indicating a gender includes every other gender;

 

(h)                                                  a reference to a party, clause, schedule, exhibit, attachment or annexure is a reference to a party, clause, schedule, exhibit, attachment or annexure to or of this agreement, and a reference to this agreement includes all schedules, exhibits, attachments and annexures to this agreement;

 

(i)                                                      if a word or phrase is given a defined meaning, any other part of speech or grammatical form of that word or phrase has a corresponding meaning;

 

(j)                                                      “includes” in any form is not a word of limitation; and

 

(k)                                                   a reference to “$” or “dollar” is to US currency.

 

2.                                                      Term of the agreement

 

This agreement and the licence granted under clause 3 commences on the Commencement Date and continues for the Term.

 

3.                                                      Licence of PGL IP

 

3.1                                               Exclusive Licence

 

(a)                                                   Subject to the terms of this agreement, PGL hereby grants and MBC accepts, an exclusive licence, including the right to sublicense, to Exploit the PGL IP in the Territory during the Term.

 

(b)                                                  To the extent that the PGL IP includes a patent, the licence granted under clause  3.1(a) ceases in respect of that patent on the expiry of that patent and the expiry of any patent extensions.

 

(c)                                                   After the Commencement Date, PGL will, at the request of MBC, provide samples of any Products it has which are relevant to the Field, including any intermediate forms and copies of the Products and any related Confidential Information.

 

(d)                                                  PGL will not sell Products relevant to the Field to End Users in the Territory nor supply Products relevant to the Field to any person who PGL has reasonable grounds to believe is likely to export the Products into the Territory.

 

(e)                                                   All enquiries PGL receives in respect of Products relevant to the Field to be delivered to End Users in the Territory will be referred to MBC.

 

6

 

3.2                                               Supply of Product for trials

 

(a)                                                   MBC may during the Term request that PGL supply Product for the purpose of carrying out pre-clinical or clinical trials.  MBC may request that PGL supply the Product as either:

 

(i)                                                     a clinical supply of Product suitable for Phase 3 trials consisting of PI-88, placebo, pre-filled 1-ml saline syringes and associated needles and product packaging (160 mg), for 800 subjects;

 

(ii)                                                  a bulk supply of PI-88 Active Pharmaceutical Ingredient in 1 kilogram quantities.

 

(b)                                                  PGL warrants that the Product supplied under this clause 3.2 will comply with the current technical and quality specifications for the Product as published by PGL from time to time and PGL will comply with good manufacturing practice.  However, to the extent permitted by law, the liability of PGL for any breach of this warranty is limited to either of the following:

 

(i)                                                     the replacement of the Product; or

 

(ii)                                                  the payment of the cost of replacing the Product.

 

(c)                                                 Contemporaneously with providing a request under clause 3.2(a)(i), MBC will, at its cost, provide to PGL security in the form of an unconditional and irrevocable financial undertaking.  The security will be in a form satisfactory to PGL and for the sum of $***.  PGL is not required to commence production of any Product or deliver any Product prior to receipt of this security.

 

(d)                                                  If MBC has made a request under clause 3.2(a)(i) then within 7 days of the occurrence of:

 

(i)                                                     MBC requesting that the Product be shipped to MBC; or

 

(ii)                                                  1 July 2011,

 

whichever is the earlier, MBC will pay $*** to a PGL bank account (the details of which are as notified by PGL to MBC from time to time).

 

(e)                                                   Upon performance of MBC’s obligations under clause 3.2(d), MBC may request that PGL discharge the security provided under clause 3.2(c) and PGL will discharge the security within 7 days of receipt of a valid written request.

 

(f)                                                     Within 30 days of making a request under clause 3.2(a)(ii), MBC will pay to a PGL bank account, the details of which are as notified by PGL to MBC from time to time, $*** per kilogram of Product requested.

 

(g)                                                  In making a request under clause 3.2(a), MBC may request that the Product be provided in multiple lots.  PGL will supply the first lot on a CIP (Carriage and Insurance Paid - Incoterms 2000) basis to the destination nominated by MBC at the time of making the request.

 

(h)                                                  Any subsequent lots or any bulk supply will be supplied on an EXW (Ex Works - Incoterms 2000) basis from PGL’s production facility.

 

7

 

4.                                                      Developed IP

 

4.1                                               Developed IP Owned by MBC

 

The parties acknowledge that all right, title and interest in and to all of the MBC Developed IP is owned by MBC.

 

4.2                                               Rights to IP developed by PGL

 

(a)                                                   If in the course of complying with its obligations under this agreement, PGL develops modifications to the Product and the PGL IP which result in the creation of new Intellectual Property, then MBC will have a right of first refusal to Exploit that Intellectual Property on terms specified by PGL.

 

(b)                                                  If MBC does not exercise its first right of refusal within 30 days of receiving the terms provided by PGL pursuant to 4.2(a), PGL may license that Intellectual Property to a third party on terms which are no more favourable than those offered to MBC under clause 4.2(a).

 

(c)                                                   If MBC exercises its right of first refusal, the parties will either vary this agreement or enter into a new agreement, in each case to reflect the terms offered under clause 4.2(a).

 

5.                                                      Sublicensing

 

5.1                                               Liability for sublicensee

 

MBC acknowledges and agrees that MBC’s use of a sublicensee does not relieve MBC of any of its obligations, duties or limitations under this agreement and any act or omission of a sublicensee will have the same consequences or effect as if such action or omission was MBC’s own.

 

6.                                                      Licence fees

 

In consideration of the licence granted to MBC under this agreement, in respect of each Product, MBC will pay the following licence fees within 30 days of the occurrence of the following events:

 

(a)                                                   a payment of $*** after the approval by any Government Agency within the Territory to commence the first Phase 3 or Pivotal Registration Clinical Trial Protocol of a Product;

 

(b)                                                  a payment of $*** after the commencement of the first Phase 3 or Pivotal Registration Clinical Trial for a Product;

 

(c)                                                   a payment of $*** after the completion of the first Phase 3 or Pivotal Registration Clinical Trial for a Product;

 

(d)                                                  a payment of $*** after the submission of a Product to any Government Agency for regulatory approval for use in the first country in the Territory;

 

(e)                                                   a payment of $*** after a relevant Government Agency gives approval for use of a Product; and

 

(f)                                                     a payment of $*** after a second relevant Government Agency gives approval for use of a Product.

 

8

 

Payment will be in US dollars by direct deposit to a PGL bank account, the details of which are as notified by PGL to MBC from time to time.

 

7.                                                      Royalties

 

7.1                                               Royalties where valid Patent

 

If MBC or its Affiliates sell Product into a country for which there is a patent or patent application specified in Schedule 1 , MBC will pay the following royalties:

 

(a)                                                   ***% of the Net Sales made by MBC and its Affiliates from that country, until Net Sales in the Territory during each one-year annual period exceed $500,000,000 per year;

 

(b)                                                  ***% of the Net Sales made by MBC and its Affiliates from that country, if Net Sales in the Territory during each one-year annual period exceed $500,000,000 per year but are less than or equal to $1,000,000,000 per year; and

 

(c)                                                   ***% of the Net Sales made by MBC and its Affiliates from that country if Net Sales in the Territory during the Term exceed $1,000,000,000 per year.

 

7.2                                               Royalties where no Patent

 

If MBC or its Affiliates sell Product into a country where there is no registered patent or patent application specified in Schedule 1, or where that patent or patent application is no longer valid or enforceable, MBC will pay the following royalties:

 

(a)                                                   ***% of the Net Sales made by MBC and its Affiliates from that country, until Net Sales in the Territory during each one-year annual period exceed $500,000,000 per year;

 

(b)                                                  ***% of the Net Sales made by MBC and its Affiliates from that country, if Net Sales in the Territory during each one-year annual period exceed $500,000,000 per year but are less than or equal to $1,000,000,000 per year; and

 

(c)                                                   ***% of the Net Sales made by MBC and its Affiliates from that country if Net Sales in the Territory during each one-year annual period exceed $1,000,000,000 per year.

 

7.3                                               Reports

 

Within 14 days of each anniversary of the Commencement Date, MBC will send PGL a report setting out:

 

(a)                                                   a summary of progress being made to obtain Government Agency approvals in the Territory;

 

(b)                                                  the details of royalties, fees or other amounts received for each month of the previous year from sublicensees; and

 

(c)                                                   the details of the total sales in each country (including a breakdown of sales by MBC, Affiliates and sublicensees) and the Net Sales in each country for each month of the previous year.

 

9

 

7.4                                               Accrual and payment of royalties

 

(a)                                                   All royalties accrue when actually received from an End User by MBC or its sublicensee.

 

(b)                                                  MBC will pay all royalties due to PGL under this clause 7 on a 6 monthly basis commencing on the Commencement Date, each payment to be made within 30 days of the end of the relevant 6 monthly period.

 

(c)                                                   Payment will be in US dollars by direct deposit to a  PGL bank account, the details of which are as notified by PGL to MBC from time to time.

 

8.                                                      MBC to Exploit

 

8.1                                               MBC to produce Products

 

(a)                                                   MBC is free to establish any technical, pre-clinical or clinical program at MBC’s expense, for the purposes of preparing any new drug application using the PGL IP with any Government Agency in the Territory.

 

(b)                                                  MBC will use reasonable efforts to carry out, at its own expense, all product development, including without limitation, regulatory and clinical work, testing, or studies relating to Products, reasonably required to obtain all regulatory approvals needed to Exploit the Products in the Territory.

 

(c)                                                   MBC will use its reasonable efforts to file, prosecute and maintain during the Term, all necessary and appropriate applications, submissions and filings to the appropriate Government Agency, to obtain approval to Exploit the Products in each country within the Territory.

 

(d)                                                  MBC will advise PGL immediately on obtaining any approval from a Government Agency in respect of a Product.

 

(e)                                                   PGL will provide reasonable assistance to MBC with:

 

(i)                                                     any Government Agency requests concerning chemical, manufacturing or control (CMC) issues; and

 

(ii)                                                  making any necessary submissions, applications or filings for approvals including providing existing relevant documentation which is in the possession of PGL.

 

(f)                                                     PGL will provide the assistance specified in 8.1(e)(i) at no charge to MBC for up to a maximum cost to PGL of $*** taking into account any out of pocket expenses and on the basis of a rate of $*** per day for its employees’ time.  For any additional assistance required by MBC under clause 8.1(e)(i)   the parties will negotiate in good faith to agree the amount payable by MBC to PGL for such assistance prior to PGL providing such assistance.

 

(g)                                                  PGL will provide the assistance as specified in 8.1(e)(ii) at no charge to MBC.

 

8.2                                               Commencement of Phase 3 Trial

 

If MBC has not commenced a Phase 3 or Pivotal Registration Clinical Trial within 12 months of the Commencement Date, PGL may at any time thereafter immediately terminate this agreement by written notice to MBC.  In order for a trial to be considered as commenced under

 

10

 

this clause, the Phase 3 or Pivotal Registration Clinical Trial must have been approved by the relevant Government Agency and a patient must have been enrolled in the trial.

 

8.3                                               Exploitation of Products

 

If MBC has not commenced the Exploitation of a Product in a country in which a valid enforceable and unexpired patent application(s), patent(s) or patent extension(s) covering the Product exists  within the Territory within five (5) years of the Commencement Date, then PGL may by written notice, advise MBC that unless it commences Exploitation of a Product in that country within 6 months (or such longer period set out in the notice), that country will be removed from the definition of Territory in this agreement.  A notice may include more than one country and will be taken to be a notice in respect of each country specified in the notice.  Should Exploitation not occur during that 6 month or longer stipulated period, the country will be removed from the Territory.

 

8.4                                               Quality

 

MBC is responsible for maintaining commercially acceptable quality control standards in all manufacturing related to a Product, including meeting the manufacturing standards required by any Government Agency and good manufacturing practice.

 

8.5                                               Notification of adverse event

 

Each party agrees to report to the other within 3 business days of receipt of the information, any serious adverse event which is reported to occur as a result of the use of the Products.  Such events must be reported in as much detail as possible, whether or not there is proof of a causal connection between events and use of Products.  A serious adverse event includes any experience relating to the Products which is reasonably regarded to be medically significant.

 

8.6                                               Insurance

 

MBC will procure and maintain at its own expense, product liability insurance in the amount of not less than $10,000,000, insuring MBC from and against all loss arising from or incidental to the Exploitation (commercial manufacturing and marketing) of the commercial Products.  MBC will procure and maintain insurance in the amounts required by the relevant Government Agency at its own expense in respect of clinical development or other pre-manufacturing activities.

 

9.                                                      Protection of Intellectual Property

 

9.1                                               Notification of infringement

 

Each party shall promptly give the other notice of:

 

(a)                                                   any claim or allegations that the exercise of the rights under the agreement constitute an infringement of the rights of any third party, including an attack on the grant or validity of any of the PGL IP or a party’s right to use the PGL IP under this agreement; and

 

(b)                                                  any third party’s infringement or threatened infringement of the PGL IP or the Developed IP,

 

of which it becomes aware.

 

11

 

9.2                                               Infringement of PGL IP

 

(a)                                                   PGL has the sole right to determine what action should be taken in respect of any infringement of PGL IP, and MBC will cooperate in the conduct of any action brought by PGL. PGL shall bear all the costs and expenses of any action it takes.

 

(b)                                                  If PGL does not bring suit against a third party who is infringing the PGL IP in the Territory within thirty (30) days of receiving a notice under clause 9.1, then MBC may give notice in writing to PGL that it wishes to commence action.  If PGL does not advise that it will commence action within 14 days of that notice, MBC may elect to bring action.

 

(i)                                                     If MBC brings an action against a third party, it will do so at its own cost and expense and within 6 months of the notice given under clause 9.2(b).

 

(ii)                                                  In exercising its rights under clause 9.2(b)(i), MBC must ensure that it does not perform any acts or omissions that in any way adversely effect:

 

A.                                                   the validity of any PGL IP;

 

B.                                                     the reputation of PGL as the owner of the PGL IP.

 

(iii)                                               All costs and expenses (including attorney’s fees) of any actions or proceedings taken by MBC (including where PGL is joined as a party) will be borne exclusively by MBC, and, in such a case, MBC shall retain the damages and other remedies as relate to the Territory received from the infringing party.

 

(c)                                                   MBC indemnifies PGL from and against any costs, fees, damages or accounts of profits awarded against PGL in any action commenced by MBC under this clause 9.2.

 

9.3                                               Maintenance of IP

 

(a)                                                   MBC will during the Term take all reasonable and necessary steps and pay all necessary expenses to obtain registration of Intellectual Property relating to any improvements made by or on behalf of PGL to PGL IP in any country in the Territory in which PGL IP is registered as at the Commencement Date.

 

(b)                                                  MBC will take all reasonable steps and pay all necessary expenses to prosecute any patent application in the Territory in respect of MBC Developed IP.

 

(c)                                                   PGL will during the Term take all reasonable steps and pay all necessary expenses to maintain for the full life of, and any extension that may be available, all Intellectual Property which is PGL IP in the Territory.

 

(d)                                                  PGL may invoice MBC for half of the costs incurred by PGL under clause 9.3(d) and MBC will pay that invoice within 30 days.  Payment will be in US dollars by direct deposit to a PGL bank account, the details of which are as notified by PGL to MBC from time to time.

 

(e)                                                   MBC may, in consultation with PGL, file on behalf of and as agent for PGL all applications and filings and take all actions necessary to obtain the benefits of registration, and PGL will sign any authorisations and instruments reasonably requested by MBC to enable MBC to comply with its obligations under this clause 9.2.

 

12

 

10.                                               Warranties and indemnities

 

10.1                                        PGL warranties

 

PGL warrants and represents to MBC that to the best of PGL’s knowledge:

 

(a)                                                   it is either the sole and beneficial owner or the exclusive licensee of the PGL IP and that the PGL IP is not encumbered nor licensed to a third party in any way inconsistent with the Exploitation of the rights granted pursuant to this agreement; and

 

(b)                                                  it is entitled to grant the rights contained in this agreement in relation to the PGL IP to MBC.

 

10.2                                        Exclusion of warranties

 

Except for the express warranties in this agreement, to the full extent permitted by law, any conditions or warranties imposed by legislation applicable to this agreement are hereby excluded.

 

10.3                                        MBC’s acknowledgments

 

MBC hereby acknowledges and agrees that:

 

(a)                                                   PGL has not made and does not by entering into this agreement make any representations or give any warranties other than those set out in this clause regarding the suitability of PGL IP or MBC Developed IP for any purpose; and

 

(b)                                                  it will not knowingly do, or assist any third party to do, anything to imperil or challenge the validity of, or PGL’s ownership of, any of the PGL IP.

 

10.4                                        MBC to indemnify PGL

 

MBC shall defend, indemnify and hold harmless PGL, its officers, employees and agents from and against all actions, suits, claims, proceedings, causes of action, judgments or demands (including those brought by third parties) which may be brought against it or them, whether on their own or jointly with PGL and whether at common law, in equity or pursuant to statute or otherwise, in respect of any loss, death, injury, illness or damage (whether personal or property) which arises out of:

 

(a)                                                   any Exploitation of any of the PGL IP or the MBC Developed IP in the Territory;

 

(b)                                                  any Product or use of any Product;

 

(c)                                                   a breach of this agreement by MBC or its Affiliates;

 

(d)                                                  the failure of any representation or warranty of MBC set forth in this agreement; or

 

(e)                                                   the negligence or wilful misconduct of MBC or its Affiliates or their employees, agents or officers,

 

except in each case to the extent any such claim results or arises from breach by PGL of any term of this agreement or the negligence or wilful misconduct of PGL or any of its employees, agents or officers.

 

13

 

10.5                                        PGL to indemnify MBC

 

PGL shall defend, indemnify and hold harmless MBC, its officers, employees and agents from and against all actions, suits, claims, proceedings, causes of action, judgments or demands (including those brought by third parties) which may be brought against it or them, whether on their own or jointly with PGL and whether at common law, in equity or pursuant to statute or otherwise, in respect of any loss, death, injury, illness or damage (whether personal or property) which arises out of a breach of clause 10.1 or 11, except to the extent that such claim results or arises from breach by MBC of any term of this agreement or the negligence or wilful misconduct of MBC and its Affiliates, or their employees, agents or officers.

 

10.6                                        Liability for costs of Infringement Claim

 

(a)                                                   Notwithstanding clauses 10.4 and 10.5, in the case of any claim of infringement of PGL IP or infringement of a third party’s Intellectual Property by the Products, which is brought by a third party against MBC in a country in the Territory (whether alone or together with PGL) (the “Infringement Claim”):

 

(i)                                                     MBC will appoint lawyers acceptable to PGL to conduct the defence of the Infringement Claim;

 

(ii)                                                  MBC will be responsible for the legal expenses and for all actions taken by MBC’s lawyers;

 

(iii)                                               MBC will not settle or compromise any case without the prior written consent of PGL, which will not be unreasonably withheld; and

 

(iv)                                              PGL will, at MBC’s cost, provide MBC with such assistance and information as MBC reasonably requests.

 

(b)                                                  If any claim for infringement of Intellectual Property is brought against either PGL or MBC in relation to any of the Products, or if MBC fails to meet any of its obligations under this clause 10.6, PGL may direct MBC to cease and forever desist from Exploiting, making, hiring, selling or otherwise disposing of any Products in the relevant country(ies) and MBC will have no claim against PGL in respect of any such direction.

 

10.7                                        General mutual representations and warranties

 

Each of the parties represents and warrants to the other party that each of the following statements is true and correct in all material respects:

 

(a)                                                   it has full power and authority to enter into, perform and observe its obligations under this agreement, and that its execution, delivery and performance of this agreement has been duly and validly authorised by all necessary corporate action; and

 

(b)                                                  this agreement and the transactions contemplated by it do not contravene its constituent documents or any law, regulation or official directive or any of its obligations or undertakings by which it or any of its assets are bound or cause a limitation on its powers or those of its directors to be exceeded.

 

10.8                                        Indemnities

 

(a)                                                   Each indemnity in this agreement is a continuing obligation, separate and independent from the other obligations of the parties, and survives termination, completion or expiration of this agreement.

 

14

 

(b)                                                  It is not necessary for a party to incur expense or to make any payment before enforcing a right of indemnity conferred by this agreement.

 

(c)                                                   A party must pay on demand any amount it must pay under an indemnity in this agreement.

 

11.                                               Confidentiality

 

11.1                                        No use or disclosure

 

Neither of the parties shall, unless specifically authorised in this agreement or with the prior written consent of the other party:

 

(a)                                                   disclose any Confidential Information of the other party;

 

(b)                                                  disclose any Confidential Information relating to a Product relevant to the Field;

 

(c)                                                   make use of any Confidential Information of the other party for any purpose other than for the purposes set forth in or in furtherance of this agreement; or

 

(d)                                                  make use of any Confidential Information relating to a Product relevant to the Field for any purpose other than for the purposes set forth in or in furtherance of this agreement.

 

11.2                                        Further obligations

 

Each of the parties must:

 

(a)                                                   use its best endeavours to keep the Confidential Information of the other party safe and secure and prevent unauthorised use, reproduction or disclosure of the Confidential Information of the other party;

 

(b)                                                  restrict the disclosure of the Confidential Information of the other party to only those employees who require the Confidential Information for the purposes of fulfilling that party’s obligations under this agreement;

 

(c)                                                   not make, assist or permit any person (including its representatives) to make any unauthorised use, disclosure or reproduction of any of the other party’s Confidential Information;

 

(d)                                                  take reasonable steps to enforce the confidentiality obligations imposed or required to be imposed by this agreement including diligently prosecuting at its cost any breach or threatened breach of such confidentiality obligations by a person to whom it has disclosed such Confidential Information and, where appropriate, making applications for interim or interlocutory relief; and

 

(e)                                                   co-operate with the other party in any action which it may take to protect the confidentiality of its Confidential Information.

 

11.3                                        Legal requirements

 

A party may disclose anything in respect of this agreement or a Product:

 

(a)                                                   as required by applicable law, rules of any stock exchange, Government Agency or ministerial directive;

 

15

 

(b)                                                  necessary to be disclosed to a Government Agency to comply with the party’s obligations under clause 8.1;

 

(c)                                                   to its professional advisors including, without limitation, accountants, financial advisors, insurers, patent attorneys and legal advisors, subject to that party agreeing to keep the Confidential Information confidential in accordance with this clause;

 

(d)                                                  in order to do anything which the party is entitled to do in respect of a Product under this agreement.

 

11.4                                        Return of Confidential Information

 

Subject to clause 11.5, all Confidential Information whether in hard copy, electronic or any other form will (at the option of the discloser of that Confidential Information) be destroyed or returned to the party who disclosed the Confidential Information within thirty (30) days of termination of the agreement and each party will cease all use of the other party’s Confidential Information.

 

11.5                                        Retention for legal advice

 

Each party’s legal representative may retain one copy of such Confidential Information solely for the purpose of determining the scope of that party’s obligations under this clause.

 

11.6                                        Survival of clause

 

The obligations of confidentiality imposed by this agreement survive the termination of this agreement.  Each party may enforce this clause 11 in favour of its Affiliates.

 

12.                                               Audit

 

12.1                                        Records

 

(a)                                                   MBC will keep full and accurate books and records setting forth Net Sales and any other information sufficient in detail to allow the calculation of royalties and licence fees to be paid by MBC.

 

(b)                                                  MBC will keep such books and records for a minimum of 7 years from the date that they are created.

 

12.2                                        Audit

 

MBC will, upon 7 days notice and during normal business hours or as otherwise agreed, permit and provide persons (“Auditors”) nominated by PGL, supervised access to MBC’s and its Affiliates’ premises, books, records, documents, computer systems, equipment and other property relevant to the performance of this agreement to verify compliance by MBC with its obligations under this agreement and its likely capacity to continue to comply with its obligations in the future (“Audit”).  Without limiting the foregoing, an Audit may include:

 

(a)                                                   review of materials relating to royalties and licence fees;

 

(b)                                                  review of arrangements and payments with End Users, sublicensees and other third parties;

 

(c)                                                   legal compliance; and

 

(d)                                                  quality assurance practices.

 

16

 

12.3                                        Security

 

In undertaking the Audit, PGL will procure that the Auditors comply with reasonable security and confidentiality requirements of MBC made known to PGL.

 

12.4                                        Co-operation

 

MBC will do things reasonably necessary to facilitate a prompt and efficient Audit.

 

12.5                                        Copies of materials

 

The Auditors may make copies of books, records, documents and other materials they have access to as part of an Audit, and MBC will provide the Auditors with the necessary facilities to enable them to do so.

 

12.6                                        Costs of the Audit

 

Should the audit reveal an underpayment discrepancy of five percent (5%) or more between any payment reported and any payment actually due to PGL, MBC shall pay all fees and expenses incurred in conducting the audit; otherwise PGL shall pay the fees and expenses incurred in conducting the audit and inspection. Underpayment discrepancies shall be paid promptly by MBC to PGL and overpayment discrepancies shall be credited to MBC’s account in connection with the next subsequent payment of royalties.

 

13.                                               Termination

 

13.1                                        Reasons for termination by either party

 

In addition to any other provisions set out in this agreement which allow a party to terminate this agreement, either party may terminate this agreement immediately by written notice to the other party in the event of:

 

(a)                                                   a failure to pay any amounts due under this agreement within the periods required, provided that the breach is not cured within one month after written notice thereof is received from the non-defaulting party;

 

(b)                                                  the other party having committed a breach of this agreement on three occasions and having received written notice of those breaches from the non-defaulting party, even if the breaches have been remedied; or

 

(c)                                                   the other party being subject to an Event of Insolvency.

 

13.2                                        Reasons for termination by PGL

 

PGL may terminate this agreement immediately by written notice to MBC if MBC offers for sale in the Territory a competing product in the field of post-resection therapy for HCC.

 

13.3                                        Consequences of termination

 

Upon termination of this agreement:

 

(a)                                                   any licence fee or royalty which has accrued to PGL but which is not yet payable, will become immediately due and payable;

 

(b)                                                  MBC will promptly destroy all marketing, labelling or advertising materials relating to the Products or the PGL IP;

 

17

 

(c)                                                   MBC will promptly execute whatever documents are necessary and take whatever steps are necessary to transfer to PGL or its nominee, free of charge except for out-of pocket expenses, all of MBC and its Affiliates and sublicensee’s right title and interest in and to any approvals given by a Government Agency including NDA’s, product licence, drug identification numbers or other health registration approvals in effect in the Territory;

 

(d)                                                  PGL may elect to:

 

(i)                                                     grant MBC 3 months to sell off its existing stocks of the Products provided that MBC continues to pay the royalties payable under this agreement and at the end of that period MBC destroys or delivers any remaining stock to PGL; or

 

(ii)                                                  purchase any stock from MBC.

 

13.4                                        Accrued rights and survival

 

Termination or expiry of this agreement will not affect:

 

(a)                                                   any rights or remedies of the parties which may have accrued before the date of termination;

 

(b)                                                  the rights and obligations of the parties which by their nature survive termination, including clauses 10, 11 and 13.

 

14.                                               Dispute resolution

 

14.1                                        Negotiation

 

(a)                                                   If there is a dispute between the parties in connection with this agreement, then within ten business days of a party notifying the other party of a dispute, a senior representative authorised to resolve the dispute from each party must meet and use all reasonable endeavours acting in good faith to resolve the dispute (the “Initial Meeting”).

 

(b)                                                  If the dispute is not resolved under clause 14.1(a) within ten business days of the Initial Meeting, then the Chief Executive Officers of MBC and PGL will, within 30 days of the Initial Meeting, meet and use all reasonable endeavours acting in good faith to resolve the dispute (the “Subsequent Meeting”).

 

14.2                                        Referral to arbitration

 

If any dispute is not resolved through good faith negotiations between the Chief Executive Officers of each party within 5 days after the date of the Subsequent Meeting, the parties must refer the dispute to arbitration in accordance with clause 15.

 

15.                                               Arbitration

 

15.1                                        Reference to arbitration

 

(a)                                                   Any controversy, claim or dispute directly or indirectly based upon, arising out of, relating to or in connection with this agreement (including but not limited to any question relating to the existence, validity or termination of this agreement) will be referred to and finally resolved by arbitration in accordance with the International Chamber of Commerce Rules of Arbitration.

 

18

 

(b)                                                  The seat of the arbitration will be Singapore.

 

(c)                                                   The number of arbitrators will be 1.

 

(d)                                                  The language of the arbitration will be English.

 

15.2                                        General principles

 

The parties further agree to the following general principles relating to the procedure of the arbitration:

 

(a)                                                   that they have chosen arbitration for the purposes of achieving a just, quick and cost-effective resolution of any dispute;

 

(b)                                                  that any arbitration conducted pursuant to this clause shall not necessarily mimic court proceedings and the practices of those courts will not regulate the conduct of the proceedings before the arbitral tribunal;

 

(c)                                                   that in conducting the arbitration, the arbitral tribunal must take into account the matters set out above, particularly in deciding issues such as:

 

(i)                                                     how many written submissions will be allowed;

 

(ii)                                                  where appropriate, the length of written submissions;

 

(iii)                                               the extent of document discovery permitted, if any;

 

(iv)                                              the consolidation of arbitration proceedings, when requested;

 

(v)                                                 the joinder of parties or the consolidation of proceedings, when requested;

 

(vi)                                              the length of any hearing; and

 

(vii)                                           the number of experts, if any, each party is allowed to appoint; and

 

(d)                                                  that the arbitral tribunal has the power to grant all legal, equitable and statutory remedies, except punitive damages.

 

15.3                                        Expedited proceedings

 

(a)                                                   The parties agree that the arbitral tribunal will conduct the arbitration as expeditiously as possible and no party will unnecessarily delay the arbitration proceedings.

 

(b)                                                  All evidence in chief will be in writing.

 

(c)                                                   Each party may only rely upon one expert witness in respect of any recognised area of specialisation, unless otherwise ordered by the arbitral tribunal.

 

15.4                                        Consolidation

 

The parties agree that section 24 of the International Arbitration Act 1974 (Cth) will apply.

 

15.5                                        Award final and binding

 

Any award will be final and binding upon the parties.

 

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15.6                                        Governing law of arbitration agreement

 

The law governing this arbitration agreement is the law in Queensland.

 

16.                                               Force Majeure

 

16.1                                        Event of Force Majeure

 

If a party is prevented in whole or in part from carrying out its obligations under this agreement (other than an obligation to pay money) as a result of Force Majeure, it must promptly notify the other party accordingly.  The notice must:

 

(a)                                                   specify the obligations it cannot perform;

 

(b)                                                  fully describe the event of Force Majeure;

 

(c)                                                   estimate the time during which the Force Majeure will continue; and

 

(d)                                                  specify the measures proposed to be adopted to remedy or abate the Force Majeure.

 

Following this notice, and while the Force Majeure continues, the obligations which cannot be performed (other than an obligation to pay money) because of the Force Majeure will be suspended.

 

16.2                                        Remedy of Force Majeure

 

The party that is prevented from carrying out its obligations under this agreement as a result of Force Majeure must:

 

(a)                                                   remedy the Force Majeure to the extent reasonably practicable and resume performance of its obligations as soon as reasonably possible; and

 

(b)                                                  take all action reasonably practicable to mitigate any loss suffered by a party as a result of its failure to carry out its obligations under this agreement.

 

16.3                                        Termination for extended Force Majeure

 

If a party is prevented from carrying out its obligations under this agreement as a result of Force Majeure for a period of 6 months, the other party may terminate this agreement by giving 30 days notice to the party claiming Force Majeure, without prejudice to any of the rights of either party accrued prior to the date of termination.

 

16.4                                        Extension of Term

 

The Term of this agreement shall be extended by the period of the Force Majeure.

 

17.                                               Notices

 

Each communication (including each notice, consent, approval, request and demand) under or in connection with this agreement:

 

(a)                                                   must be in writing;

 

(b)                                                  must be addressed as follows (or as otherwise notified by that party to each other party from time to time):

 

20

 

	
PGL
  	
 
  	
 
  
	
 
  	
 
  	
 
  
	
Name:
  	
 
  	
Progen Pharmaceuticals Limited
  
	
Address:
  	
 
  	
16 Benson Street, Toowong, 4066, Queensland, 
 Australia
  
	
Fax:
  	
 
  	
(+61) 7 3720 9624
  
	
For the attention of:
  	
 
  	
Chief Executive Officer
  

 

	
MBC
  	
 
  	
 
  
	
 
  	
 
  	
 
  
	
Name:
  	
 
  	
Medigen Biotechnology Corp.
  
	
Address:
  	
 
  	
14F., No.3, Yuancyu St., Nangang District, Taipei 
 City 11560, Taiwan (R.O.C.)
  
	
Fax:
  	
 
  	
Fax : +886 2 2785-6120
  
	
For the attention of:
  	
 
  	
Chief Executive Officer
  

 

(c)                                                   must be signed by the party making it or (on that party’s behalf) by the solicitor for, or any attorney, director, secretary or authorised agent of, that party;

 

(d)                                                  must be delivered by hand or posted by prepaid post to the address, or sent by fax to the number, of the addressee, in accordance with clause 17(b); and

 

(e)                                                   is taken to be received by the addressee:

 

(i)                                                     (in the case of prepaid post sent to an address in the same country) on the third day after the date of posting;

 

(ii)                                                  (in the case of prepaid post sent to an address in another country) on the fifth day after the date of posting by airmail;

 

(iii)                                               (in the case of fax) at the time in the place to which it is sent equivalent to the time shown on the transmission confirmation report produced by the fax machine from which it was sent; and

 

(iv)                                              (in the case of delivery by hand) on delivery,

 

but if the communication is taken to be received on a day that is not a working day or after 5.00 pm, it is taken to be received at 9.00 am on the next working day (“working day” meaning a day that is not a Saturday, Sunday or public holiday and on which banks are open for business generally, in the place to which the communication is posted, sent or delivered).

 

18.                                               General

 

18.1                                        Governing law

 

This Agreement shall be construed pursuant to the laws of the Queensland, Australia without regard to conflicts of laws provisions thereof.

 

18.2                                        Jurisdiction

 

Subject to clause 15, all matters arising from or related to this Agreement shall be brought only in the federal or state courts in Queensland, Australia.

 

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18.3                                        Assignment

 

A party cannot assign, novate or otherwise transfer any of its rights or obligations under this agreement without the prior consent of each other party, which in the case of PGL cannot be unreasonably withheld or delayed by MBC.

 

18.4                                        Amendments

 

This agreement may only be varied by a document signed by or on behalf of each party.

 

18.5                                        Waiver

 

(a)                                                  Failure to exercise or enforce, or a delay in exercising or enforcing, or the partial exercise or enforcement of, a right, power or remedy provided by law or under this agreement by a party does not preclude, or operate as a waiver of, the exercise or enforcement, or further exercise or enforcement, of that or any other right, power or remedy provided by law or under this agreement.

 

(b)                                                 A waiver or consent given by a party under this agreement is only effective and binding on that party if it is given or confirmed in writing by that party.

 

(c)                                                  No waiver of a breach of a term of this agreement operates as a waiver of another breach of that term or of a breach of any other term of this agreement.

 

18.6                                        Further acts and documents

 

Each party must promptly do all further acts and execute and deliver all further documents (in form and content reasonably satisfactory to that party) required by law or reasonably requested by another party to give effect to this agreement.

 

18.7                                        No representation or reliance

 

(a)                                                  Each party acknowledges that no party (nor any person acting on a party’s behalf) has made any representation or other inducement to it to enter into this agreement, except for representations or inducements expressly set out in this agreement.

 

(b)                                                 Each party acknowledges and confirms that it does not enter into this agreement in reliance on any representation or other inducement by or on behalf of any other party, except for representations or inducements expressly set out in this agreement.

 

18.8                                        Expenses

 

Except as otherwise provided in this agreement, each party must pay its own costs and expenses in connection with negotiating, preparing, executing and performing this agreement.

 

18.9                                        Entire agreement

 

To the extent permitted by law, in relation to its subject matter, this agreement:

 

(a)                                                   embodies the entire understanding of the parties, and constitutes the entire terms agreed by the parties; and

 

(b)                                                  supersedes any prior written or other agreement of the parties.

 

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18.10                                 Sub-contracting

 

Unless expressly authorised by this agreement, a party may not sub-contract any of its obligations under this agreement without the prior written consent of the other party which consent must not be unreasonably withheld but may be given subject to such reasonable terms as may be necessary to protect the consenting party’s rights or interests under this agreement.

 

18.11                                 Relationship of the parties

 

(a)                                                  Each party to this agreement represents and warrants to the other party that it has the legal capacity to enter into this agreement.

 

(b)                                                 Nothing in this agreement is intended or will be construed as constituting a partnership, agency or joint venture relationship between the parties. All activities by the parties hereunder will be performed by them as independent contractors.

 

(c)                                                  Neither party will act in a manner inconsistent with clause 18.11(b) without the express informed written consent of the other party and, in particular, will not pledge the credit of the other party nor receive money on behalf of the other party nor enter into any agreements or make any representation on behalf of the other party.

 

18.12                                 Remedies cumulative

 

The rights, powers and remedies provided to the parties  in this agreement are in addition to, and do not exclude or limit, any right, power or remedy provided by law or equity or by any agreement.

 

18.13                                 Severability of provisions

 

Any provision of this agreement that is prohibited or unenforceable in any jurisdiction is ineffective as to that jurisdiction to the extent of the prohibition or unenforceability.  That does not invalidate the remaining provisions of this agreement nor affect the validity or enforceability of that provision in any other jurisdiction.

 

18.14                                 Change in control

 

All rights and liabilities under this agreement continue in force notwithstanding any change in the equity ownership of either of the parties.

 

18.15                                 Publicity

 

Neither party may use the name or logo of the other party in any public document or disclosure whether written, oral or otherwise communicated without the prior written consent of the other party.

 

18.16                                 Counterparts

 

This agreement may be executed in any number of counterparts.  All counterparts together will be taken to constitute one instrument.

 

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Schedule 1 - PGL IP

 

1.                                                      Patents and Patent Applications

 

	
COUNTRY
  	
 
  	
OFFICIAL
 NO.
  	
 
  	
TITLE
  	
 
  	
CASE
 STATUS
  
	
AUSTRALIA
  	
 
  	
702500
  	
 
  	
Preparation and Use of Sulfated Oligosaccharides
  	
 
  	
Registered
  
	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  
	
BRAZIL
  	
 
  	
PI9608041-8
  	
 
  	
Sulfated Oligosaccharide, Process for the Anti-Angiogenic, Anti-Metastatic and/or Anti-Inflammatory Treatment of a Human Patient or Other Warm/Blooded Animal Patient, use of an Oligosaccharide and Pharmaceutical or Veterinary Composition for Anti-Angiogenesis
  	
 
  	
Pending
  
	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  
	
CANADA
  	
 
  	
2218872
  	
 
  	
Preparation and Use of Sulfated Oligosaccharides
  	
 
  	
Registered
  
	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  
	
CHINA
  	
 
  	
ZL96193563.4
  	
 
  	
Preparation and Use of Sulfated Oligosaccharides
  	
 
  	
Registered
  
	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  
	
EUROPE
  	
 
  	
0837683
  	
 
  	
Preparation and Use of Sulfated Oligosaccharides
  	
 
  	
Registered
  
	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  
	
ISRAEL
  	
 
  	
118047
  	
 
  	
Sulfated Oligosaccharides, Pharmaceutical Compositions Containing Them and Preparation of Sulfated Hexopyranose Homooligosaccharides
  	
 
  	
Registered
  
	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  
	
JAPAN
  	
 
  	
532038/96
  	
 
  	
Preparation and Use of Sulfated Oligosaccharides
  	
 
  	
Pending
  
	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  
	
REPUBLIC OF KOREA
  	
 
  	
0591960
  	
 
  	
Preparation and Use of Sulfated Oligosaccharides
  	
 
  	
Registered
  
	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  
	
MEXICO
  	
 
  	
243061
  	
 
  	
Preparation and use of Sulfated Oligosaccharides
  	
 
  	
Registered
  
	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  
	
NEW ZEALAND
  	
 
  	
305815
  	
 
  	
Preparation and Use of Sulfated Oligosaccharides
  	
 
  	
Registered
  
	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  
	
POLAND
  	
 
  	
184357
  	
 
  	
Preparation and Use of Sulfated Oligosaccharides
  	
 
  	
Registered
  
	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  
	
RUSSIAN FEDERATION
  	
 
  	
001199
  	
 
  	
Preparation and Use of Sulfated Oligosaccharides
  	
 
  	
Registered
  
	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  
	
SINGAPORE
  	
 
  	
48558
  	
 
  	
Preparation and Use of Sulfated Oligosaccharides
  	
 
  	
Registered
  
	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  
	
TAIWAN
  	
 
  	
138332
  	
 
  	
Preparation and Use of Sulfated Oligosaccharides
  	
 
  	
Registered
  
	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  
	
UNITED STATES OF
  	
 
  	
6143730
  	
 
  	
Preparation and Use of Sulfated Oligosaccharides
  	
 
  	
Registered
  

 

24

 

	
COUNTRY
  	
 
  	
OFFICIAL
 NO.
  	
 
  	
TITLE
  	
 
  	
CASE
 STATUS
  
	
AMERICA
  	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  
	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  	
 
  
	
SOUTH AFRICA
  	
 
  	
96/3339
  	
 
  	
Preparation and Use of Sulfated Oligosaccharides
  	
 
  	
Registered
  

 

2.                                                      Trade marks

 

2.1                                               Registered

 

Nil.

 

2.2                                               Unregistered

 

PI-88

 

Muparfostat

 

Muparfostat sodium

 

25

 

Executed as an agreement

 

 

	
Executed by PROGEN PHARMACEUTICALS
 LIMITED ABN 82 010 975 612
  by or in the presence of:
  	
 
  	
 
  	
 
  
	
 
  	
 
  	
 
  	
 
  
	
 
  	
 
  	
 
  	
 
  
	
 
  	
 
  	
 
  	
 
  
	
 
  	
 
  	
 
  	
 
  
	
   Signature of Director
  	
 
  	
 
  	
   Signature of Secretary/other Director
  
	
 
  	
 
  	
 
  	
 
  
	
 
  	
 
  	
 
  	
 
  
	
 
  	
 
  	
 
  	
 
  
	
 
  	
 
  	
 
  	
 
  
	
   Name of Director in full
  	
 
  	
 
  	
   Name of Secretary/other Director in full
  
	
 
  	
 
  	
 
  	
 
  
	
 
  	
 
  	
 
  	
 
  
	
Executed by MEDIGEN BIOTECHNOLOGY
 CORP.
  by its authorised officers:
  	
 
  	
 
  	
 
  
	
 
  	
 
  	
 
  	
 
  
	
 
  	
 
  	
 
  	
 
  
	
 
  	
 
  	
 
  	
 
  
	
 
  	
 
  	
 
  	
 
  
	
   Signature of Director
  	
 
  	
 
  	
   Signature of Secretary/other Director
  
	
 
  	
 
  	
 
  	
 
  
	
 
  	
 
  	
 
  	
 
  
	
 
  	
 
  	
 
  	
 
  
	
 
  	
 
  	
 
  	
 
  
	
   Name of Director in full
  	
 
  	
 
  	
   Name of Secretary/other Director in full
  

 

26Exhibit 10.1

 

REVOLVING LOAN CREDIT AGREEMENT

 

CREDIT AGREEMENT, dated as of December 20, 2010 (as the same may be amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), is made by and between American Heritage Life Insurance Company, a life insurance company domiciled in Florida (together with its successors and assigns, the “Lender”), and Road Bay Investments, LLC, a limited liability company organized under the laws of the State of Delaware (together with its successors and assigns, the “Borrower”).

 

WHEREAS, the Borrower desires to borrow, and the Lender agrees to extend, revolving credit loans to the Borrower during the period from and after the Closing Date (as hereafter defined) in accordance with the terms and conditions of this Credit Agreement.

 

NOW, THEREFORE, the Borrower and the Lender hereby agree as follows:

 

1.         Definitions. As used in this Credit Agreement, unless otherwise defined herein, the following terms shall have the following meanings (such meanings to be equally applicable to both the singular and plural forms of the terms defined):

 

“Authorized Officer” means the President, Chief Financial Officer, Controller, or Treasurer or any Assistant Treasurer of the Borrower.

 

“Borrower” is defined in the preamble of this Credit Agreement.

 

“Borrowing Date” shall mean the date on which a Revolving Loan is made by the Lender in favor of the Borrower.

 

“Business Day” shall mean any day other than a Saturday, Sunday or other day on which commercial banks are required or authorized to be closed in Chicago, Illinois; provided, however, that when used in connection with the calculation or determination of LIBOR or the payment or prepayment of any amounts accruing interest at such rate or providing notices in connection with such rate, “Business Day” shall mean any Business Day in Chicago in which dealings in Dollars are carried on in the London interbank market.

 

“Closing Date” shall mean December 20, 2010 or such other date on which the conditions precedent set forth in Section 4 hereof have been satisfied in full or waived in accordance with the terms hereof.

 

“Commitment Fee” is defined in Section 2.9 hereof.

 

“Default” means any event or circumstance that with the giving of notice, the lapse of time or both would constitute an Event of Default.

 

“Dollars” and the symbol “$” shall mean dollars in the lawful money of the United States of America.

 

 

“Event of Default” is defined in Section 5.1 hereof.

 

“Federal Funds Rate” shall mean (i) for any Business Day, the rate on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers, as published for such day by the Federal Reserve Bank of New York, and (ii) for any day which is not a Business Day, the Federal Funds Rate for the preceding Business Day.

 

“GAAP” shall mean generally accepted accounting principles in the United States of America.

 

“Indebtedness” shall mean, without duplication, the Borrower’s liabilities for borrowed money; liabilities for the deferred purchase price of property (excluding accounts payable arising in the ordinary course of business but including, without limitation, all liabilities created or arising under any conditional sale or other title retention agreement with respect to any such property); capitalized lease obligations; all liabilities for borrowed money secured by any lien with respect to any property owned by the Borrower (whether or not it has assumed or otherwise become liable for such liabilities); and any guaranty by the Borrower with respect to such liabilities or obligations of another person or entity.

 

“Interest Period” shall mean (a) the period commencing on the Borrowing Date of a Revolving Loan and ending on the numerically corresponding day in the calendar month that is three months after such Borrowing Date, and (b) thereafter, each period commencing on the last day of the immediately preceding Interest Period and ending on the numerically corresponding day in the calendar month that is three months thereafter; provided, however, that (i) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day, unless such Business Day falls in another calendar month, in which case such Interest Period shall end on the next preceding Business Day, (ii) any Interest Period which begins on a date for which there is no corresponding date in the calendar month during which such Interest Period is to end, shall end on the last Business Day of such calendar month, and (iii) no Interest Period shall end after the Maturity Date and any Interest Period which would, but for this clause, end after the Maturity Date shall instead end on the Maturity Date.

 

“Lender” is defined in the preamble of this Credit Agreement.

 

“LIBOR” shall mean, with respect to each day during each Interest Period pertaining to any Revolving Loan, the rate per annum determined on the basis of the rate for deposits in Dollars for a period equal to such Interest Period commencing on the first day of such Interest Period appearing on Reuters Screen LIBOR 01 Page (or any successor page) as of 11:00 A.M., London time, two Business Days prior to the beginning of such Interest Period. In the event that such rate does not appear on Reuters Screen LIBOR 01 Page (or any successor page), “LIBOR” shall be determined by reference to such other comparable publicly available service for displaying eurodollar rates as may be selected by the Lender.

 

2

 

“Loan Account” is defined in Section 2.7 hereof.

 

“Loan Documents” shall mean each of this Credit Agreement, the Pledge and Security Agreement, and each other document, instrument and agreement executed and delivered pursuant to or in connection herewith or therewith, as the same may be amended, supplemented or otherwise modified from time to time.

 

“Maturity Date” shall mean December 31, 2013, or such earlier date on which the Revolving Loans are due and payable and the commitment of the Lender to make any such Revolving Loans has been terminated or otherwise cancelled (whether at stated maturity, by mandatory prepayment, by acceleration or otherwise) in accordance with the terms hereof.

 

“Notice of Borrowing” is defined in Section 2.1(b) hereof.

 

“Parent” shall mean The Allstate Corporation.

 

“Pledge and Security Agreement” means the agreement dated as of the date hereof between the Borrower and Lender in substantially the form attached hereto as Exhibit A.

 

“Revolving Credit Termination Date” shall mean December 31, 2013, or such later date as set forth in Section 2.5(d) hereof, or such earlier date on which the Revolving Loan Commitment is terminated in full hereunder.

 

“Revolving Loan” is defined in Section 2.1(a) hereof.

 

“Revolving Loan Commitment” is defined in Section 2.1(a) hereof.

 

“Total Assets” shall mean, at any time, the total assets of the Borrower which would be shown as assets on a balance sheet as of such time prepared in accordance with GAAP.

 

2.         The Revolving Loans.

 

2.1       The Revolving Loan Commitment and Making of Revolving Loans.

 

(a)       On the terms and subject to the conditions of this Credit Agreement, the Lender agrees, from time to time on any Business Day during the period commencing on the date hereof up to but excluding the Revolving Credit Termination Date, to make revolving loans to the Borrower (the “Revolving Loans”) in amounts, which together with all outstanding Revolving Loans, will not exceed in the aggregate the principal amount of $15,000,000 (the “Revolving Loan Commitment”).  The Revolving Loan Commitment shall be subject to reduction and/or termination as herein provided (including, without limitation, pursuant to Sections 2.5 and 5.2 hereof).  On the terms and subject to the conditions hereof, the Borrower may from time to time borrow, prepay, and re-borrow the Revolving Loans.  Any such borrowing shall be denominated in Dollars, as

 

3

 

hereinafter provided, and shall be in the aggregate principal amount of $100,000 or any whole multiple thereof in excess of $100,000.  On the Revolving Credit Termination Date, the Revolving Credit Commitment shall terminate and the Lender shall have no obligation whatsoever to make any further Revolving Loans to the Borrower.

 

(b)       Each Revolving Loan shall be made upon written notice (in form and substance satisfactory to the Lender, a “Notice of Borrowing”), given by the Borrower to the Lender at least three and not more than five Business Days prior to the proposed borrowing date thereof.  Each Notice of Borrowing shall specify therein (A) the proposed borrowing date, which shall be a Business Day, and (B) the principal amount of such Revolving Loan.  Each Notice of Borrowing will be provided by an Authorized Officer. Upon fulfillment of the applicable conditions set forth in Section 4 hereof (or the waiver thereof by the Lender as herein prescribed), the Lender will make the proceeds of such Revolving Loan available to the Borrower in same day funds at the Lender’s Office at 3075 Sanders Road, Northbrook, Illinois 60062.

 

2.2       Interest.

 

(a)       Each Revolving Loan shall bear interest for each day during each Interest Period with respect thereto at a rate per annum equal to the sum of (a) LIBOR and (b) 2.5%.

 

(b)       Subject to Section 2.4 hereof, interest shall be payable on each Revolving Loan (i) in arrears on the last day of each Interest Period, and (ii) on the date on which the principal amount of such Revolving Loan becomes due and payable hereunder (whether at stated maturity, by mandatory prepayment, optional prepayment, acceleration or otherwise).

 

(c)       Notwithstanding anything herein to the contrary, all accrued interest shall be payable on each date principal is payable hereunder pursuant to Sections 2.3 and 2.5 hereof or such earlier date as herein required.

 

(d)       Interest shall accrue from and including the first day of an Interest Period to but excluding the last day of such Interest Period.

 

(e)       In the event, and on each occasion, that on the date two Business Days prior to the commencement of any Interest Period for any Revolving Loan which accrues interest at a rate based upon LIBOR, the Lender shall have in good faith determined that dollar deposits in the outstanding principal amount of such Revolving Loan are generally not available in the London interbank market, or that reasonable means do not exist for ascertaining LIBOR, or that the rates at which such dollar deposits are being offered will not adequately and fairly reflect the cost to the Lender of making or maintaining such Revolving Loan at LIBOR during such Interest Period, the Lender shall, as soon as practicable thereafter, give written notice of such determination to the Borrower.  In the event of any such determination, interest shall accrue with respect to such Revolving Loan during such Interest Period at a rate determined by reference to the Federal Funds

 

4

 

Rate plus 2%.  Each determination by the Lender hereunder shall be conclusive absent manifest error.

 

2.3       Principal Repayment.

 

(a)       The Borrower shall repay the outstanding principal balance of all outstanding Revolving Loans together with all other outstanding amounts due and owing hereunder or under the other Loan Documents on the Maturity Date.

 

(b)       The Borrower’s obligations to the Lender with respect to the payment of interest and principal with respect to the Revolving Loans shall be evidenced by this Credit Agreement and the Loan Account.

 

2.4       Default Interest. Any principal, interest or other amount which is not paid when due, whether at stated maturity, by mandatory prepayment, by acceleration or otherwise, shall bear interest from the day when due until such principal, interest or other amount is paid in full, payable on demand, at a rate equal at all times to the Federal Funds Rate plus 3.5%.

 

2.5       Termination, Reduction or Extension of Revolving Loan Commitment; Prepayment.

 

(a)       The Borrower shall have the right at any time or from time to time, without premium or penalty, upon not less than three Business Days’ prior written notice to the Lender from an Authorized Officer, to terminate or reduce the Revolving Loan Commitment.  Any such reduction of the Revolving Loan Commitment shall be in an amount that is an integral multiple of $1,000,000 and not less than $1,000,000. Any termination or reduction of the Revolving Loan Commitment shall be permanent.

 

(b)       Borrower shall have the right at any time or from time to time, without premium or penalty, to prepay all or any portion of the principal amount outstanding of Revolving Loans. Any prepayment shall be made together with accrued interest to the date of such prepayment on the amount prepaid; provided, however, that (i) prepayments of Revolving Loans prior to the Maturity Date shall not reduce the Revolving Loan Commitment; and (ii) all prepayments shall be in amounts not less than the lesser of $100,000 or an integral multiple thereof or the amount of any Revolving Loan being prepaid.  Each prepayment made pursuant to this Section shall be accompanied by the payment of accrued interest to date of such prepayment on the amount prepaid.

 

(c)       If the Borrower receives notice from the Lender that the aggregate principal amount of all Revolving Loans outstanding hereunder exceeds the Revolving Loan Commitment at any time, the Borrower shall prepay Revolving Loans, together with all accrued interest thereon, as necessary to eliminate such excess within two Business Days after receipt of such notice.

 

(d)       Subject to any applicable regulatory approvals, the Revolving Credit Termination Date may be extended any number of times as follows:

 

5

 

(i)        An Authorized Officer shall give the Lender written request at least one year and 30 days before the Revolving Credit Termination Date then in effect.

 

(ii)       The Lender shall consider and determine whether to grant such request and shall give a written notice of its decision within 30 days.

 

(iii)      In the event the Lender grants the Borrower’s request the Revolving Credit Termination Date then in effect shall extend for one calendar year.  Otherwise the Revolving Credit Termination Date shall remain unchanged.

 

2.6       Method of Payment.

 

(a)       All sums payable by the Borrower to the Lender hereunder shall be payable in Northbrook, Illinois, in Dollars in immediately available funds and without any defense, set-off or counterclaim no later than 12:00 noon (Northbrook time) on the day when due, for the account of and as directed by the Lender.  Any payments made after 12:00 noon (Northbrook time) on any day shall be deemed to have made on the immediately following Business Day.

 

(b)       Any payments shall be applied first to default charges, indemnities, expenses and other non-principal and interest amounts owed under any of the Loan Documents, if any, then to interest due and payable on the Revolving Loans, and thereafter to the principal amount of the Revolving Loans due and payable.

 

(c)       All computations of interest and fees shall be made by the Lender on the basis of a year of 360 days for the actual number of days (including the first day but excluding the last day) occurring in the period for which such interest is payable; provided, however, that if a Revolving Loan is repaid on the same day on which it is made, one day’s interest shall be paid on such Revolving Loan.

 

(d)       Whenever any payment to be made hereunder or under any instrument delivered hereunder shall be stated to be due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day, and such extension of time shall in such case be included in the computation of the payment of interest; provided, however, that if such extension would cause such payment to be made in a new calendar month or beyond the Maturity Date, such payment shall be made on the next preceding Business Day.

 

2.7       Loan Account.  The Lender shall maintain on its books a loan account in the Borrower’s name (the “Loan Account”), showing the date and amount of each Revolving Loan, the amount of each principal payment and prepayment, the computation and payment of interest, and any other amounts due and sums paid hereunder and under the other Loan Documents.  The entries made by the Lender in the Loan Account shall be conclusive and binding on the Borrower and the Lender as to the amount at any time due from the Borrower, absent manifest error, provided the failure to so record or any error therein shall not in any manner affect the obligations of Borrower hereunder.

 

6

 

2.8       Use of Proceeds.  No proceeds of any of the Revolving Loans may be used to acquire any equity security of a class which is registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended and as in effect from time to time, or any “Margin Stock”, as defined in Federal Reserve Board Regulation U or otherwise be used in a manner which would violate Section 7 of the Securities Exchange Act of 1934, as amended and as in effect from time to time, or any regulations issued pursuant thereto.

 

2.9       Commitment Fee.  The Borrower shall pay to the Lender on the last Business Day of each March, June, September and December while the Revolving Loan Commitment is in effect, but commencing on or as of March 31, 2011, a non-refundable commitment fee in arrears in an amount equal to 0.125% of the Revolving Loan Commitment.

 

3.         Covenants.  The Borrower hereby covenants to the Lender that, unless the Lender shall otherwise consent in writing, during the term of this Credit Agreement or so long as (a) any amounts owed hereunder or under any other Loan Document are outstanding, or (b) the Revolving Credit Commitment has not been reduced to zero, the Borrower shall (unless the prior written consent of the Lender has been obtained) perform the following obligations:

 

(a)       Notices.  The Borrower shall promptly notify the Lender of the occurrence of any Default or Event of Default, which notice shall be provided to the Lender as soon as possible, but in no event later than five days after the Borrower becomes aware of the same and shall include a statement as to what action the Borrower has taken and/or proposes to take with respect thereto.

 

(b)       Ratio of Indebtedness to Total Assets. Until this Credit Agreement is terminated and all obligations of the Borrower under this Credit Agreement have been paid or performed in full, the Borrower covenants and agrees that it will not directly or indirectly, create, incur, assume, guarantee, or otherwise become directly or indirectly liable with respect to any Indebtedness, unless on the date the Borrower becomes liable with respect to any such Indebtedness and immediately after giving effect thereto and the concurrent retirement of any other Indebtedness, no Event of Default exists and the aggregate amount of Borrower’s Indebtedness does not exceed 50% of its Total Assets as of the last day of its then most recently ended quarter.

 

4.         Conditions Precedent to the Initial Revolving Loans.

 

(a)       The obligation of the Lender to make the initial Revolving Loan is subject to the prior fulfillment of the following conditions:

 

(i)        Documents.  The Lender shall have received the following, each in form and substance satisfactory to the Lender:

 

(1)    Executed Agreement. This Credit Agreement, duly executed by an Authorized Officer (other than an Assistant Treasurer).

 

7

 

(2)    Pledge and Security Agreement.  The Pledge and Security Agreement, duly executed by an Authorized Officer (other than an Assistant Treasurer).

 

(3)    Notice of Borrowing. A Notice of Borrowing as required under Section 2.1(b) hereof.

 

(4)    Other Items.  Such other agreements, instruments, approvals, opinions and documents as the Lender may reasonably request.

 

(ii)       Fees and Expenses. The Lender shall have received all of the fees, costs and expenses that are then due and payable hereunder and under the other Loan Documents.

 

(iii)      Legality.  The making of the Revolving Loans shall not contravene any law, rule or regulation applicable to the Lender or the Borrower.

 

(iv)      Defaults.  No Default or Event of Default shall have occurred and be continuing on the date of such Revolving Loan or would result from making such Revolving Loan.

 

(b)       Subsequent Loans. The obligation of the Lender to make subsequent Revolving Loans shall, in addition to the fulfillment of the conditions set forth in paragraph (a) above, be subject to the following:

 

(i)        Notice of Borrowing. The Lender shall have received a Notice of Borrowing as required under Section 2.1(b) hereof.

 

(ii)       Fees and Expenses. The Lender shall have received all of the fees, costs and expenses that are then due and payable hereunder and under the other Loan Documents.

 

(iii)      Legality.  The making of such Revolving Loans shall not contravene any law, rule or regulation applicable to the Lender or the Borrower.

 

(iv)      Defaults.  No Default or  Event of Default shall have occurred and be continuing on the date of such Revolving Loans or would result from making of such Revolving Loans.

 

(v)       Other Items.  The Lender shall have received such other agreements, instruments, approvals, opinions and documents as the Lender may reasonably request.

 

5.       Events of Default.

 

5.1     Events of Default. Each of the following events and occurrences shall constitute an “Event of Default” under this Credit Agreement:

 

8

 

(a)       The Borrower shall fail to pay when due and payable any amount that the Borrower is obligated to pay under (i) this Credit Agreement, and, in the case of any such amounts other than the principal amount of any Revolving Loan, such failure shall continue for a period of three Business Days, (ii) any other Loan Document to which it is a party or (iii) any other instrument or agreement evidencing Indebtedness of the Borrower to the Lender, subject to any applicable grace period provided for therein; or

 

(b)       The Borrower shall fail to perform or shall violate any provision, covenant, condition or agreement of this Credit Agreement or any other Loan Document on its part to be performed or observed (other than those set forth in paragraph (a) of this Section 5.1) and such failure or violation is not remediable or, if remediable, continues unremedied for a period of 15 days after the earlier of (i) notice from the Lender or (ii) such time as the Borrower becomes aware of the same; or

 

(c)       The Borrower is adjudicated a bankrupt or insolvent, or admits in writing its inability to pay its debts as they become due or makes an assignment for the benefit of creditors, or ceases doing business as a going concern or applies for or consents to the appointment of any receiver or trustee, or such receiver, trustee or similar officer is appointed with the application or consent of the Borrower, or bankruptcy, dissolution, liquidation or reorganization proceedings (or proceedings similar in purpose and effect) are instituted by the Borrower or are instituted against (and not vacated or discharged within 30 days) the Borrower; or

 

(d)       The Parent shall cease to own, directly or indirectly, 100% of the membership interests in the Borrower.

 

5.2       Consequence of Default.  Upon the occurrence of any Event of Default described in Section 5.1 and during the continuance thereof, the Lender may, by notice of default given to the Borrower, terminate the Revolving Loan Commitment and declare all of the outstanding principal amount of all Revolving Loans and all other amounts payable hereunder, and under any other Loan Document to be immediately due and payable, whereupon the Revolving Loan Commitment shall be terminated and the unpaid principal amount of all outstanding Revolving Loans, together with accrued interest thereon, and all such other amounts, shall be immediately due and payable without presentment, protest, demand or other requirement of any kind, each of which is hereby expressly waived by the Borrower.

 

6.         Miscellaneous.

 

6.1       Entire Agreement.  This Credit Agreement, the other Loan Documents and the documents referred to herein and therein constitute the entire obligation of the parties with respect to the subject matter hereof and shall supersede any prior expressions of intent or understanding with respect to the transactions herein and therein contemplated.

 

6.2       No Waiver; Cumulative Rights.  The failure or delay of the Lender to require performance by the Borrower of any provision of this Credit Agreement shall not

 

9

 

operate as a waiver thereof, nor shall it affect the Lender’s rights to require performance of such provision at any time thereafter, nor shall it affect or impair any of the remedies, powers or rights of the Lender with respect to any other or subsequent failure, delay or default. Each and every right granted to the Lender hereunder or under any other Loan Document or in connection herewith or therewith shall be cumulative and may be exercised at any time.

 

6.3       Successors and Assigns; Third Party Beneficiaries. The provisions of this Credit Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors.  This Credit Agreement shall not be transferred or assigned under any circumstances. Nothing in this Credit Agreement, expressed or implied, shall be construed to confer upon any person or entity (other than the parties hereto and their respective successors and permitted transferees) any legal or equitable right, remedy, or claim under or by reason of this Credit Agreement.

 

6.4       GOVERNING LAW; CONSENT TO JURISDICTION.  THIS CREDIT AGREEMENT SHALL IN ALL RESPECTS BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF ILLINOIS.

 

6.5       Notices.  Except in the case of notices and other communications expressly permitted to be given by telephone, all notices and other communications provided for herein shall be delivered by the following means:  (i) hand delivery, (ii) overnight courier service (e.g., FedEx, or Airborne Express); (iii) registered or certified U.S. mail, postage prepaid, and return receipt requested; (iv) electronic e-mail; or (v) facsimile transmission. If any notice or other communication provided for herein is sent by any party by electronic e-mail it shall not be deemed to have been delivered to the addressee if the party sending such notice or communication receives a response from the intended addressee that he or she will not be able to retrieve e-mail due to vacation, other absence from the office, system failure, or other reason.  All such notices shall be delivered to the parties as set forth as follows:

 

To the Borrower:

 

Road Bay Investments, LLC

3075 Sanders Road, Suite G5C

Northbrook, Illinois 60062

Facsimile:  847-402-9116

Attention:  President

 

To the Lender:

 

American Heritage Life Insurance Company

3075 Sanders Road

Northbrook, Illinois 60062

Facsimile:  847-402-4346

Attention:  Commercial Mortgage Division

 

10

 

All notices and other communications given to any party hereto in accordance with the provisions of this Credit Agreement shall be deemed to have been given on the date of receipt.

 

6.6       Amendments, Waivers.

 

(a)       Except as otherwise expressly provided herein, no amendment or waiver of any provision of this Credit Agreement shall in any event be effective unless the same shall be in writing and signed by the parties hereto.

 

(b)       Each such amendment, waiver, or consent shall be effective only in the specific instance and for the specific purpose for which given. A failure or delay in exercising any right, power, or privilege with respect to this Credit Agreement will not be presumed to operate as a waiver, and a single or partial exercise of any right, power, or privilege will not be presumed to preclude any subsequent or further exercise of that right, power, or privilege or the exercise of any other right, power, or privilege.

 

6.7       Counterparts; Facsimile Signature.  This Credit Agreement may be signed in any number of counterparts.  Either a single counterpart or a set of counterparts when signed by all the parties hereto shall constitute a full and original agreement for all purposes. Delivery of any executed signature page hereof or of any amendment, waiver or consent to this Credit Agreement by facsimile transmission shall be as effective as delivery of a manually executed counterpart thereof.

 

6.8       Severability.  Any provision of this Credit Agreement or any other Loan Document that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining portions hereof or thereof or affecting the validity or enforceability of such provision in any other jurisdiction.

 

[SIGNATURE PAGE FOLLOWS]

 

11

 

IN WITNESS WHEREOF, the parties hereto have caused this Credit Agreement to be executed by their duly authorized representatives as of the date first written above.

 

 

	
 
  	
ROAD BAY INVESTMENTS, LLC
  
	
 
  	
 
  
	
 
  	
 
  
	
 
  	
By: 
  	
/s/ Mark W. Davis
  
	
 
  	
 
  	
Name: Mark W. Davis
  
	
 
  	
 
  	
Title: Chairman of the Board and President
  
	
 
  	
 
  	
 
  
	
 
  	
 
  	
 
  
	
 
  	
By: 
  	
/s/ Steven E. Shebik
  
	
 
  	
 
  	
Name: Steven E. Shebik
  
	
 
  	
 
  	
Title: Chief Financial Officer
  
	
 
  	
 
  
	
 
  	
 
  
	
 
  	
AMERICAN HERITAGE LIFE INSURANCE COMPANY
  
	
 
  	
 
  	
 
  
	
 
  	
 
  	
 
  
	
 
  	
By:
  	
/s/ John C. Pintozzi
  
	
 
  	
 
  	
Name: John C. Pintozzi
  
	
 
  	
 
  	
Title: Chief Financial Officer
  
	
 
  	
 
  	
 
  
	
 
  	
 
  	
 
  
	
 
  	
By:
  	
/s/ Mario Rizzo
  
	
 
  	
 
  	
Name: Mario Rizzo
  
	
 
  	
 
  	
Title: Vice President and Treasurer

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00182-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00182-of-00352.parquet"}]]