SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (date of earliest event reported): March 27, 2009
CEL-SCI CORPORATION
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(Exact name of Registrant as specified in its charter)
Colorado 0-11503 84-0916344
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(State or other jurisdiction (Commission File No.) (IRS Employer
of incorporation) Identification No.)
8229 Boone Blvd. #802
Vienna, VA 22182
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(Address of principal executive offices, including Zip Code)
Registrant's telephone number, including area code: (703) 506-9460
N/A
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(Former name or former address if changed since last report)
Item 8.01 Other Events
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Effective March 6, 2009, CEL-SCI Corporation entered into a licensing
agreement with Byron Biopharma LLC ("Byron") under which CEL-SCI granted Byron
an exclusive license to market and distribute CEL-SCI's cancer drug Multikine(R)
in the Republic of South Africa. CEL-SCI has existing licensing agreements for
Multikine with Teva Pharmaceuticals in Israel and Turkey and Orient Europharma
in Taiwan, Singapore, Hong Kong, Malaysia and South Korea, the Philippines,
Australia and New Zealand.
Pursuant to the agreement, Byron will be responsible for registering the
product in South Africa. Once Multikine has been approved for sale, CEL-SCI will
be responsible for manufacturing the product, while Byron will be responsible
for sales in South Africa. Revenues will be divided equally between CEL-SCI and
Byron. To maintain the license Byron, among other requirements, must make
milestone payments to CEL-SCI totaling $125,000 on or before March 15, 2010.
On March 27, 2009, and as further consideration for its rights under the
licensing agreement, Byron Biopharma purchased 3,750,000 Units from CEL-SCI at a
price of $0.20 per Unit. Each Unit consisted of one share of CEL-SCI's common
stock and two warrants. Each warrant entitles the holder to purchase one share
of CEL-SCI's common stock at a price of $0.25 per share. The warrants will be
exercisable at any time after September 8, 2009 and prior to March 6, 2016. The
shares of common stock included as a component of the Units were registered by
CEL-SCI under the Securities Act of 1933. CEL-SCI will file a new registration
statement to register the shares issuable upon the exercise of the warrants.
Item 9.01 Financial Statements and Exhibits
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Exhibit Number Description
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5 Opinion of Counsel
10(i) Distribution Agreement
10(j) Form of Warrant
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: March 31, 2009
CEL-SCI CORPORATION
By: /s/ Patricia B. Prichep
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Patricia B. Prichep, Senior Vice President
of Operations
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CEL-SCI CORPORATION
FORM 8-K
EXHIBITS
EXHIBIT 5
March 30, 2009
CEL-SCI Corporation
8229 Boone Boulevard, Suite 802
Vienna, Virginia 22182
This letter will constitute an opinion upon the legality of the sale by CEL-SCI
Corporation, a Colorado corporation ("CEL-SCI"), of 3,750,000 shares of common
stock, as well as warrants to purchase an additional 7,500,000 shares of
CEL-SCI's common stock, all as referred to in the Registration Statement on Form
S-3 (File No. 333-151667) filed by CEL-SCI with the Securities and Exchange
Commission.
We have examined the Articles of Incorporation, the Bylaws and the minutes of
the Board of Directors of CEL-SCI and the applicable laws of the State of
Colorado, and a copy of the Registration Statement. In our opinion, CEL-SCI is
authorized to issue the shares of stock mentioned above and such shares
represent fully paid and non-assessable shares of CEL-SCI's common stock.
Very truly yours,
HART & TRINEN
/s/ William T. Hart
William T. Hart
EXHIBIT 10(i)
DEVELOPMENT, SUPPLY AND
DISTRIBUTION AGREEMENT
DEVELOPMENT, SUPPLY AND DISTRIBUTION AGREEMENT ("Agreement") dated March 06,
2009, by and between CEL-SCI Corporation, a Colorado corporation ("CEL-SCI"),
and Byron Biopharma LLC, a Delaware limited liability company ("Byron
Biopharma").
WHEREAS, CEL-SCI and Byron Biopharma are engaged in the development and
distribution, respectively, of pharmaceutical products; and
WHEREAS, Byron Biopharma wishes to obtain from CEL-SCI exclusive marketing and
distribution rights in the Territory with respect to CEL-SCI's pharmaceutical
Product (as defined) manufactured and developed by CEL-SCI, and wishes to have
CEL-SCI supply it with such Product; and
WHEREAS, CEL-SCI wishes to grant Byron Biopharma exclusive marketing and
distribution rights for cancer indications and to supply Byron Biopharma with
such Product for resale in the Territory;
NOW, THEREFORE, in consideration for the mutual promises contained herein, the
parties agree as follows:
1. Definitions
As used in this Agreement, the following definitions shall apply:
a. "Commencement Date" shall mean, with respect to the Product, the date of
the first commercial sale of such Product in The Republic of South Africa.
b. "Contract Year" shall mean a calendar year, according to the USA
calendar.
c. "FOB" shall have the meaning ascribed in the Uniform Commercial Code in
effect in Maryland, USA. "FOB point of origin" shall mean FOB at the CEL-SCI
manufacturing or packaging site or at its contractor's site where such
activities are performed, for the Product in the USA.
d. "MCC" shall mean the Medical Control Council, the South African health
authorities, or its successors.
e. "IND" shall mean an Investigational New Drug application filed with the
U.S. or Canadian health authorities or any other national health authority
recognized by the Medicines Control Council in the Republic of South Africa
covering manufacture of the Product dosage form(s) being evaluated in clinical
trials under such IND.
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f. "Labeling" shall mean all package inserts, vial labels and carton
imprints and all other markings on packaging for, or other similar materials
related to, the Product for commercial sale that are defined as labeling under
any applicable law or regulation. "Labeling" shall also mean such labeling
applicable to the use of clinical supplies (e.g., Investigational Drug
Brochure).
g. "Manufacturing Cost" shall mean CEL-SCI's fully-burdened direct and
indirect manufacturing costs and expenses associated in producing the Product,
including, but not limited to, cost of materials, supplies, utilities, rent,
labor (including taxes, benefits, overheads), third party contract expenses,
administration, depreciation for plant and equipment and any other direct
expenses.
h. "Gross Selling Price" is (1) the national reimbursement price approved
by The Republic of South Africa, or (2) in the event that The Republic of South
Africa does not grant the approval to reimburse the payments, Gross Selling
Price is the contract price between Byron Biopharma and the major hospitals in
the Republic of South Africa.
i. "Net Sales" - the total amount actually received by Byron Biopharma or
its Affiliates from the arms length sale of the Product, provided that as to
sales other than at arms length, the term "Net Sales" shall mean the total
amount that would have been due in an arms length sale, according to the then
current conditions for such sale or - in the absence of such current conditions
- according to reasonable conditions for such sale, in all cases after deduction
of:
o sales taxes (including value added taxes) to the extent applicable to
sales of the Product and not collected separately from the
counter-party to such sales; and
o credits or allowances, if any, actually granted, and approved by
Supplier, on account of price adjustments, recalls, rejections or
return of the Product previously sold; and
o all shipment, storage, transportation and other direct administrative
expenses required for the distribution of the Product.
j. "Specifications" shall mean, with respect to the Product, the
specifications set forth in the IND for such Product approved by the health
authorities in the Territory.
k. "Product" shall mean CEL-SCI's Leukocyte Interleukin Injection
(Multikine(TM)), plus any improvements thereto, which shall comply with the
Specifications, approved by health authorities in the Territory.
l. "Purchase Price" is the transfer price of Product for commercial sale
from CEL-SCI to Byron Biopharma as specified in Section 8.1.
m. "Quarter" means a complete period consisting of the months of January to
March, April to June, July to September, and October to December, all inclusive.
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n. "Term" shall have the meaning ascribed to it in Section 3(a) hereof.
o. "Territory" shall mean the Republic of South Africa.
2. Authorization and Acceptance of Distribution
a. Subject to the terms and conditions herein contained, CEL-SCI hereby
appoints Byron Biopharma, following regulatory approval for sale, as its
exclusive distributor to market, distribute and sell the Product for human
cancer indications in the Territory.
b. Byron Biopharma will be entitled to appoint sub-distributors for the
Territory with respect to marketing, distributing and selling the Product and to
perform any of the obligations undertaken by it under this Agreement through any
corporation or entity controlling or under common control with Byron Biopharma.
These appointments will be subject to CEL-SCI approval which approval will not
be unreasonably withheld.
3. Term
a. The term of this Agreement shall commence on the date hereof and shall
terminate on the twentieth anniversary date of the Commencement Date for the
Product. The 20-year term may hereinafter be referred to as the "Term."
b. After the 20-year period has expired, the exclusive Term for the
Product shall automatically be extended for successive two-year periods unless
at least six months before the expiration of the then current period for such
Product, either party gives written notice to the other that it does not wish to
extend the exclusive Term.
c. Following the expiration of this Agreement, all rights of Byron
Biopharma to the Product, as well as any discoveries, inventions, or
improvements to the Product will expire and revert to CEL-SCI. In addition,
Byron Biopharma will sign over to CEL-SCI any rights that Byron Biopharma may
retain in the Product (e.g. product registration in the countries of the
Territory). Byron Biopharma will also return all data and/or documents that
relate to the Product. Notwithstanding anything herein to the contrary, Byron
Biopharma shall have the right to sell Product obtained from CEL-SCI hereunder
in its possession after termination of this Agreement.
e. Notwithstanding anything herein to the contrary, this Agreement will
expire on March 15, 2010 unless Byron Biopharma pays CEL-SCI a milestone payment
totaling $125,000 by such date.
4. Regulatory Approvals
a. Byron Biopharma shall file substantially complete and correct
applications in the Territory.
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b. After receiving from CEL-SCI all pertinent documentation required by
various regulatory authorities, Byron Biopharma, at its own expense and as
promptly as possible, shall file substantially complete and correct applications
for all approvals necessary to market, sell and distribute the Product in the
Territory. In support of such filings, CEL-SCI agrees to provide pertinent
information and technical assistance to Byron Biopharma in seeking these
approvals. CEL-SCI shall provide to a third party chosen by CEL-SCI, all
pertinent process technology information necessary for registration of the
Product to the extent that is permitted by the applicable laws and regulations
in the Territory. The third party will forward such information to the health
authorities for the purpose of completing the Byron Biopharma application(s).
c. In addition to the provisions of Sections 4(b), Byron Biopharma shall,
at its own expense and as promptly as possible, use all due diligence to obtain
all additional governmental and other approvals which may subsequently become
necessary for Byron Biopharma to import and market, sell and distribute such
Product for human cancer indications throughout the Territory.
d. Byron Biopharma shall promptly provide to CEL-SCI copies, along with
English translations, of all of its product registrations and other approvals
for the marketing, distribution and sale of the Product in the Territory. Byron
Biopharma shall comply with all applicable laws in the Territory in conducting
clinical studies and in marketing, distributing and selling the Product.
e. All preclinical and clinical data generated in the Territory shall
belong to CEL-SCI for CEL-SCI's use in Product registrations outside the
Territory.
5. Manufacturing and Packaging of Product
a. CEL-SCI will manufacture the Product and deliver as finished Product
suitable for sale where the country allows.
b. Byron Biopharma will provide label copy to be used on vials and patient
packs in all cases where English is not acceptable.
c. Byron Biopharma shall be responsible for ensuring the accuracy of the
information and the form of the Labeling for the Product and their compliance
with applicable laws within the Territory.
d. Byron Biopharma may market, sell and/or distribute the Product under
the trademark owned or used by CEL-SCI (e.g., Multikine(TM)). Upon Byron
Biopharma's request, CEL-SCI shall license Byron Biopharma to use its trademark
in the Territory. Byron Biopharma may market, sell and/or distribute the Product
in the Territory under any trademark owned or used by it as it may from time to
time choose. Such trademarks shall become the sole property of CEL-SCI.
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6. Supply of the Product for Commercial Sale
a. No later than six months prior to the first day of each Contract Year
of the Term, Byron Biopharma will provide to CEL-SCI a non-binding forecast of
Byron Biopharma's annual requirements of the Product for the succeeding Contract
Year. CEL-SCI shall advise Byron Biopharma within thirty (30) days of its
receipt of such forecast of CEL-SCI's anticipated ability to supply the
forecasted amount for the applicable period (such confirmed amount, the
"Forecasted Amount").
b. If at any time during the Term, CEL-SCI is or expects that it will be
unable to satisfy the Forecasted Amount of Product for any period of a Contract
Year, in full or in part, CEL-SCI shall so notify Byron Biopharma promptly,
detailing the extent to which it will not meet such Forecasted Amount.
c. It shall be the responsibility of CEL-SCI to maintain reasonably
adequate manufacturing capabilities of the Product, using its reasonable
commercial best efforts to supply the Forecasted Amounts.
d. CEL-SCI will be the exclusive and sole supplier of Product to Byron
Biopharma during the Term of this Agreement.
7. Shipment of Product for Commercial Sale
a. Byron Biopharma shall place all orders for Product by delivering to
CEL-SCI a written purchase order specifying the Product, quantity and delivery
date (which delivery date shall not be less than 180 days after the date such
purchase order is delivered to CEL-SCI).
b. After accepting any written purchase order, CEL-SCI shall use
reasonable commercial efforts to fill each order by the specified delivery date
and shall notify Byron Biopharma of anticipated delays in filling any order.
c. With each shipment of Product to Byron Biopharma hereunder, CEL-SCI
shall invoice Byron Biopharma for the Product included in such shipment at the
Purchase Price as set forth in Section 8.1. Payment shall be made in U.S.
dollars, by Confirmed Irrevocable Letter of Credit from an internationally
recognized bank to CEL-SCI's US bank.
d. Product shall be shipped FOB point of origin. Byron Biopharma shall
arrange for the carrier or shipping agent to transport each shipment of Product
from CEL-SCI's loading dock at the point of origin to desired destination. Byron
Biopharma will ensure that adequately monitored freezer (-20(Degree)C +/-
3(Degree)C) space is maintained for Product storage prior to its distribution.
Byron Biopharma shall arrange for carrier / shipment of Product to maintain
frozen condition.
8. PRICE AND TERMS OF PAYMENT
8.1 Price: The amounts to be paid by Byron Biopharma to Supplier in
connection with the supply of Product shall be as follows:
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The greater of: (i) fifty (50%) percent of the Net Sales of such Product,
and (ii) one hundred fifty percent (150%) of Supplier's Manufacturing Cost for
such quantity of Product.
8.2 With every delivery of the Product to Byron Biopharma, Supplier shall
send Byron Biopharma an invoice. For commercial supplies of Product, the initial
transfer price for each unit of Product shall be based upon the average Net
Sales per unit as described in the latest Sales Certificate (defined below). All
payments shall be made within thirty (30) days from the last day of the month in
which the invoice was issued, in a manner of a bank transfer to a bank account
number, provided by Supplier to Byron Biopharma sufficient time in advance of
such bank transfer.
8.3 Within thirty (30) days of the end of each Quarter, Byron Biopharma
shall prepare and deliver to Supplier a certificate ("the Sales Certificate")
setting out details of the Net Sales of the Product by Byron Biopharma during
the relevant Quarter, including the gross selling price and any deductions
described in the definition of Net Sales. Notwithstanding the foregoing, Byron
Biopharma shall prepare and deliver the first Sales Certificate together with
its first order of Products for non-clinical use. All Sales Certificates for
periods prior to the Launch Date will include Byron Biopharma's reasonable non
binding estimate of the anticipated sales price and relevant deductions.
8.4 At the end of each calendar year, Byron Biopharma will prepare a
summary of the previous year's Net Sales and will calculate the payments already
paid by Byron Biopharma and a true-up payment will be made by the applicable
party in order to reconcile the amounts paid with the purchase prices described
in Clause 8.1.
8.5 To the extent that sales are effected by Byron Biopharma, other than in
United States Dollars, Byron Biopharma shall convert the sum of such sales into
US Dollars in accordance with the selling rate for such currency quoted in the
Wall Street Journal last published on the business day on which Byron Biopharma
remits payment to Supplier.
8.6 Byron Biopharma shall keep full and true books of account and other
records in accordance with generally accepted accounting practice in the
Republic of South Africa so that details of sales of the Product, and Byron
Biopharma's payment obligations in respect thereof, may be properly ascertained.
Byron Biopharma shall preserve such books and records for three (3) years after
the calendar year to which they pertain. Such books and records shall be open to
inspection by an independent certified public accountant selected by Supplier,
and subject to confidentiality obligations as strict as in this Agreement, at
Supplier's expense, during normal business hours upon ten (10) business days'
prior written notice, for the purpose of verifying the accuracy of the reports
and computations rendered by Byron Biopharma. In the event Byron Biopharma
underpaid the amounts due to Supplier with respect to the audited period by more
than five percent (5%), Byron Biopharma shall pay the reasonable cost of such
examination, together with the deficiency not previously paid, within thirty
(30) days of the last day of the month of the date of receipt of notice from
Supplier.
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8.7 As further consideration for its rights under this Agreement, Byron
Biopharma agrees to purchase 3,750,000 Units from CEL-SCI at a price of $0.20
per Unit. Each Unit consists of one share of CEL-SCI's common stock and two
warrants. Each warrant will entitle the holder to purchase one share of
CEL-SCI's common stock at a price of $0.25 per share. The warrants will be
exercisable at any time after September 08, 2009 and prior to March 06, 2016.
CEL-SCI will use its existing shelf registration statement to register the
shares of common stock included as a component of the Units. CEL-SCI will file a
new registration statement to register the shares issuable upon the exercise of
the warrants.
9. CEL-SCI's Warranty and Liability
a. CEL-SCI warrants and guarantees that, prior to Byron Biopharma taking
possession, upon delivery FOB point of origin, the Product shall meet the
Specifications and shall not be adulterated or misbranded as required by the
health authorities within the Territory ("Warranty").
b. CEL-SCI will provide Byron Biopharma with a Certificate of Analysis for
each shipment of Product, stating test results and the Specifications for such
shipment of Product.
c. Other than as in the specifications provided for in this Agreement,
CEL-SCI makes no other warranties with respect to the Product. CEL-SCI does not
make any implied warranties with respect to the effectiveness of this Product.
d. CEL-SCI shall indemnify, defend and hold harmless Byron Biopharma from
all actions, losses, claims, demands, damages, costs, and liabilities to which
Byron Biopharma is or may become liable insofar as they arise out of, or in
connection with, any breach by CEL-SCI of any of its obligations or Warranty
under this Agreement.
10. Regulatory Compliance
a. It shall be the responsibility of CEL-SCI to ensure that the Product
sold by CEL-SCI to Byron Biopharma pursuant hereto meets the Specifications at
the time of delivery to Byron Biopharma FOB point of origin.
b. Byron Biopharma shall comply with all applicable laws in the Territory
with respect to packaging, marketing, distributing, selling, promoting and
advertising the Product in the Territory.
11. Representations, Warranties and Covenants
a. Byron Biopharma and CEL-SCI represent and warrant to each other that
each party has all requisite corporate power and authority to enter into this
Agreement and to consummate the transactions contemplated hereby.
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b. CEL-SCI further represents, warrants and covenants that:
i) The Product sold to Byron Biopharma hereunder does not infringe
any patent or third party rights in the United States and the Territory
related to the manufacture of the Product; and
ii) CEL-SCI possesses good title to the Product sold to Byron
Biopharma hereunder; and
iii) CEL-SCI will not market, distribute or sell, to any party other
than Byron Biopharma, the Product in the Territory except as provided for
by this Agreement; and
iv) This Agreement shall be binding upon either party's lawful
successors and assigns without changing any terms and conditions hereof.
12. Protection Rights
a. Except as otherwise provided by this Agreement, CEL-SCI shall not grant
any third party the right to sell, ship and/or distribute the Product to any
person or entity outside the Territory who CEL-SCI knows intends to sell, ship
and/or distribute the Product (in bulk or dosage form) in or to the Territory
for human cancer indications. In the event CEL-SCI becomes aware during the time
that Byron Biopharma has exclusive rights pursuant to this Agreement, that any
third party with whom CEL-SCI contracts to distribute Product outside the
Territory is selling or distributing Product in the Territory directly or
indirectly, CEL-SCI shall promptly advise such third party to cease selling and
distributing Product in the Territory. In the event that such third party
continues to sell or distribute Product in the Territory following such notice,
CEL-SCI shall commence legal action against such party to terminate such
activity.
b. During the Term of this Agreement, Byron Biopharma shall not directly or
indirectly manufacture, develop, ship, market, sell or distribute any
immunotherapeutic product that competes with Product in the Territory for the
indications of head & neck cancer, adenocarcinoma of the nasal pharynx or
cervical cancer. In addition, Byron Biopharma shall not directly or indirectly
manufacture, develop, ship, market, sell or distribute any product that is a
cytokine mixture, for any indication.
c. Byron Biopharma shall not directly or indirectly manufacture, develop,
ship, market, sell or distribute Product outside the Territory.
d. If there are any new discoveries, inventions, patents, or other
intellectual property as the result of this Agreement, CEL-SCI shall own such
intellectual property.
13. Confidentiality
a. Any information pertaining to the Product and/or the respective
operations of the parties that has been or will be communicated by CEL-SCI to
Byron Biopharma or by Byron Biopharma to CEL-SCI, including, without limitation,
trade secrets, business methods, and pricing, cost, supplier, manufacturing and
customer information, shall be treated by CEL-SCI and Byron Biopharma
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respectively, and their respective affiliates, employees and agents, as
confidential information and shall not be used or revealed to third parties
except as necessary in connection with the performance of their respective
obligations hereunder; provided, however, that such confidential information
shall not be subject to the restrictions and prohibitions set forth in this
section to the extent that such confidential information:
i) is available in the public literature or otherwise in the public
domain, or after disclosure by one party to the other becomes public
knowledge through no fault of the party receiving such confidential
information;
ii) was known through legitimate means to the party receiving such
confidential information prior to the receipt of such confidential
information by such party from the disclosing party, as evidenced by such
receiving party's written records, whether received before or after the
date of this Agreement;
iii) is obtained in good faith by the party receiving such
confidential information from a source other than the party supplying such
confidential information who was not under an obligation of confidence or
secrecy to either party at the time of such disclosure; or
iv) is required to be disclosed pursuant to:
(A) any order of a court having jurisdiction and power to
order such information to be released or made public
(with prior notice to the disclosing party and
opportunity to contest by such party to the extent
legally possible); or
(B) any lawful action of a governmental or regulatory agency
(with prior notice to the disclosing party and
opportunity to contest by such party to the extent
legally possible); or
v) is required to be disclosed to a prospective, bona fide purchaser
of the shares or assets of either party hereto, provided all such
prospective purchasers agree in writing to be bound by the standards of
confidentiality.
b. Each party shall take all such precautions as it normally takes with
its own confidential information to prevent any improper disclosure of such
confidential information to any independent third party; provided, however, that
such confidential information may be disclosed within the limits required to
obtain any authorization from the Medical Control Council authorities or any
other governmental or regulatory agency in the Territory or, with the prior
written consent of the other party, which shall not be unreasonably withheld, as
may otherwise be required in connection with the purposes of this Agreement.
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14. Force Majeure
If either Byron Biopharma or CEL-SCI shall be delayed, hindered,
interrupted in or prevented from the performance of any of its obligations
hereunder (other than the obligation to pay monies) by reason of force majeure
("Force Majeure"), including, without limitation, fire, earthquake, flood or
other acts of God, strike, lockouts, war (declared or undeclared), civil
disturbances, embargo, riots, unavailability of essential materials or
transportation facilities, orders of any governmental authority (not caused by a
default or other action of the party invoking such Force Majeure) or other
similar events beyond the control of such party, such party shall not be liable
to the other for damages, and the time for performance of such obligation shall
be extended for a period of time equal to the duration of the contingency which
occasioned such delay, hindrance, interruption or prevention. Byron Biopharma
understands that the Product is difficult to manufacture and test. Therefore,
Byron Biopharma understands that there may be manufacturing problems, due to
reasons outside of CEL-SCI's control, where CEL-SCI may not be able to supply
the Product in a timely manner. CEL-SCI will make best efforts to minimize any
delay or interruption in supply.
15. Termination
a. This Agreement may be terminated in its entirety immediately upon
written notice of termination given by:
i) The non-defaulting party in the event that the other party shall:
(A) commit a material breach or default under this
Agreement, which breach or default shall not be remedied
within sixty (60) days after the receipt of written
notice thereof by the party in breach or in default; or
(B) have made a material misrepresentation of any
representation or warranty contained herein;
ii) Either party in the event that any free trade agreements
affecting the countries, is abrogated, amended or modified so as to
materially and adversely affect the commercial benefits inuring to either
party under this Agreement as in effect on the date hereof;
iii) Either party if the other party ceases to function as a going
concern or if proceedings in bankruptcy or insolvency are taken against the
other party and not remedied within thirty (30) days or if its property or
business or its shares be confiscated or expropriated by any government or
subdivision thereof;
16. Indemnification
a. CEL-SCI shall indemnify and hold harmless Byron Biopharma and its
affiliates, successors and permitted assigns and their respective officers,
directors, stockholders, partners and employees from and against any claim,
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action, suit, proceeding, loss liability, damage or expense (other than special
or consequential damages but including reasonable attorneys` fees and expenses)
arising from or related to (i) any material breach of any representation,
warranty or covenant made by CEL-SCI hereunder, including without limitation any
failure to manufacture the Product in conformity with the Warranty and (ii) any
negligent storage or handling of Product by CEL-SCI or its employees prior to
Product transfer to Byron Biopharma (delivery to Byron Biopharma FOB point of
origin).
b. Byron Biopharma shall indemnify and hold harmless CEL-SCI and its
affiliates, successors and permitted assigns and their respective officers,
directors, stockholders, partners and employees from and against any claim,
action, suit, proceeding, loss liability, damage or expense (other than special,
incidental or consequential damages, but including reasonable attorneys` fees)
arising from or related to (i) any material breach of any representation,
warranty or covenant made by Byron Biopharma hereunder, (ii) the storage,
handling, use or sale of Product following delivery Byron Biopharma FOB point of
origin, or (iii) packaging instructions provided by Byron Biopharma.
17. Customer Complaints; Recall
a. Pursuant to the United States Code of Federal Regulations Title
21 Section 314.80 , as the same may be amended from time to time, regarding the
reporting of adverse drug experiences, Byron Biopharma shall immediately report
to CEL-SCI any information concerning adverse drug experiences associated with
the use of Product, whether or not considered drug-related, and including but
not necessarily limited to: an adverse event occurring in the course of the use
of Product in clinical trials, or in professional practice; an adverse event
occurring from overdose, whether accidental or intentional; or any significant
failure of expected pharmacological action. Additionally, reports of routine
adverse drug experiences shall be summarized and exchanged between the parties
once per calendar year. Byron Biopharma shall report potentially serious or
unexpected adverse drug experiences as defined in Title 21 Section 314.80, as
amended, to CEL-SCI as soon as possible, but in no event later than three (3)
days after initial receipt of the information by Byron Biopharma and shall
maintain a record of each such experience as required under Title
21 Section 314.80(c)(iii). Byron Biopharma agrees to cooperate with CEL-SCI in
arriving at a mutually acceptable course of action regarding the handling of
such information; however, nothing contained herein shall be construed as
restricting the right or duty of either party to report the information to the
appropriate regulatory bodies.
b. In the event of any recall of Product, as suggested or requested by any
governmental authority, or any recall to which both parties agree in writing,
Byron Biopharma shall perform the recall, and the reasonable documented costs
thereof, including CEL-SCI`s and Byron Biopharma's respective costs of
manufacturing and distributing the Product recalled, will be borne by CEL-SCI or
by Byron Biopharma if said recall can be attributed to Byron Biopharma's fault.
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18. Patent & Trademark Ownership
CEL-SCI will maintain ownership of its Product patents, trademarks and
know how and is responsible for maintaining, prosecuting and defending these
patents and trademarks in the Territory.
19. Notices
Any notice or request required or permitted to be given under or in
connection with this Agreement shall be in writing in the English language and
shall be deemed to have been duly given on the date of delivery if delivered
personally, by confirmed facsimile or by courier on the party to whom such
notice or request is to be given, or, if sent by certified or registered mail,
or the equivalent, postage prepaid, on the tenth (10th) day after the date
mailed.
20. Governing Law; Arbitration
The formation, validity, construction and performance of this Agreement
shall be governed by the laws the Commonwealth of Virginia, USA. All disputes
arising in connection with this Agreement shall be finally settled by binding
arbitration under the Rules of Arbitration of the International Chamber of
Commerce by one or more arbitrators appointed in accordance with said Rules. Any
such arbitration shall be conducted in English. The arbitration shall take place
in Virginia, USA. The judgment of the arbitration shall be final and binding to
both parties.
21. Miscellaneous
Entire Agreement
This Agreement constitutes the entire Agreement between the parties relating to
the subject matter hereof, and supercedes all prior agreements and
understandings, oral or written between the parties. Any change to this
Agreement must be in writing and signed by an authorized officer of each party,
and specifically state that it is an amendment to this Agreement.
Product Improvements
During the Term of this Agreement, Byron Biopharma will have rights to
improvements to the Product at no additional cost.
Independent Contractors
Each party is an independent contractor under this Agreement. Neither party is
an agent, partner or legal representative of the other.
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Late Payments
All amounts due and owing to a party under this Agreement that are not paid by
the other party when due shall bear interest at the rate of 1 1/2% per month, or
if lower, the maximum rate allowed by law, in either case calculated from the
date the amount was first due.
Withholding Taxes
Payments to CEL-SCI shall be made without deduction other than such amount (if
any) as Byron Biopharma is required by law to deduct or withhold. Byron
Biopharma shall obtain a receipt from the relevant taxing authorities for all
withholding taxes paid and forward such receipts to CEL-SCI to enable CEL-SCI to
claim any tax credits for which it may be eligible. Byron Biopharma shall use
reasonable efforts to minimize such withholdings and to assist CEL-SCI to claim
exemption from withholdings under any double taxation treaty or similar
agreement.
Export Law Compliance
Byron Biopharma understands that the Product and other materials may be subject
to the export regulations of the US Department of Commerce or other US
regulations related to the export of drugs. Byron Biopharma represents that it
is familiar with and agrees to comply with all such regulations. Byron Biopharma
agrees that it will not export or reexport outside of the Territory, directly or
indirectly, any Product, clinical supplies or clinical data relating to the
Product without prior written consent of CEL-SCI. Byron Biopharma agrees to
obtain the same agreement from each of its subdistributors in the Territory.
Government Inquiries
Each party shall promptly advise the other of any governmental inquiries about
the Product and shall furnish to the other party, within five days of receipt,
any report or correspondence issued by the governmental authority in connection
with such inquiry, purged only of trade secrets.
Publicity
The parties agree that news releases, public announcements (written or oral),
professional publications or any publicity relating to this Agreement, including
the initial announcement of the Agreement, clinical results, regulatory filings
and marketing approvals of the Product in the Territory, shall be mutually
agreed by the parties, such approval not to be unreasonably withheld.
Notwithstanding this Section 21, CEL-SCI may disclose, without approval from
Byron Biopharma, any information, including confidential information (1)
required by law or regulation (including, without exception, in connection with
filings with the US Securities and Exchange Commission); (2) in response to a
valid order of a court or other governmental body of the US or any country in
the Territory or of any political subdivision thereof; (3) otherwise required by
applicable laws; (4) otherwise necessary to file or prosecute patent
applications, prosecute or defend litigation or otherwise enforce obligations
under this Agreement; or (5) required by authorities, investigators, or
Institutional Review Boards in conjunction with performing clinical development
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programs, provided that the receiving party shall use reasonable efforts to
restrict disclosure and to cause such authorities, investigators or IRBs not to
disclose the information to any third party.
Records
With respect to the Gross Selling Price of Product sold in the Territory, if
Gross Selling Price falls under definition 1 h, then Byron Biopharma will, upon
request and subject to confidentiality, provide to CEL-SCI copies of the
contracts between the major hospitals and Byron Biopharma showing price
provisions. If these copies are not in English, Byron Biopharma will translate
the price provisions into English. CEL-SCI shall have the right to these records
during the Term of this Agreement and this right shall expire six months
following termination or expiration of this Agreement.
Surviving Obligations
Termination or expiration of this Agreement shall not relieve either party of
its obligations under Sections 4(e), 12(d), 13, 16, 17, 19, 20 and 21.
IN WITNESS HEREOF, the parties hereto have executed this Agreement as of the day
and year first above written.
Byron Biopharma LLC CEL-SCI Corporation
By: /s/ Edward Smith By: /s/ Geert Kersten
-------------------------- -------------------------
Edward Smith Geert Kersten
President Chief Executive Officer
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EXHIBIT 10(j)