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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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CEL-SCI CORPORATION |
(Exact name of registrant as specified in its charter) |
COLORADO | 84-0916344 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
8229 Boone Blvd., Suite 802
Vienna, Virginia
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22182 | |
(Address of principal executive offices) | (Zip Code) |
Common Stock, $.01 par value
Series S Warrants
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(Title of Class)
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Large accelerated filer | o | Accelerated filer | þ |
Non-accelerated filer | o | Smaller reporting company | o |
(Do not check if a smaller reporting company) |
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expand the disclosure to Item 1. with respect to certain agreements;
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add two risk factors in Item 1A.; and
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file additional exhibits (Item 15).
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1)
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Multikine (Leukocyte Interleukin, Injection) investigational immunotherapy against cancer and Human Papilloma Virus (HPV);
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2)
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LEAPS technology, with two investigational therapies, LEAPS-H1N1-DC pandemic flu treatment for hospitalized patients and CEL-2000, a rheumatoid arthritis treatment vaccine.
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In the final Phase II clinical study, using the same dosage and treatment regimen as is being used in the Phase III study, head and neck cancer patients with locally advanced primary disease who received the investigational therapy Multikine as first-line investigational therapy followed by surgery and radiotherapy were reported by the clinical investigators to have had a 63.2% overall survival (OS) rate at 3.5 years from surgery. This percentage OS was arrived at as follows: of the 22 subjects enrolled in this final Phase II study, the consent for the survival follow-up portion of the study was received from 19 subjects. One subject did not consent to the follow-up portion of the study. The other 2 subjects did not have squamous cell carcinoma of the oral cavity and were thus not evaluable per the protocol. The overall survival rate of subjects receiving the investigational therapy in this study was compared to the overall survival rate that was calculated based upon a review of 55 clinical trials conducted in the same cancer population (with a total of 7,294 patients studied), and reported in the peer reviewed scientific literature between 1987 and 2007. Review of this literature showed an approximate survival rate of 47.5% at 3.5 year from treatment. Therefore, the results of CEL-SCI's final Phase II study were considered to be potentially favorable in terms of overall survival recognizing the limitations of this early-phase study. It should be noted that an earlier investigational therapy Multikine study appears to lend support to the overall survival findings described above - Feinmesser et al Arch Otolaryngol. Surg. 2003. However, no definitive conclusions can be drawn from these data about the potential efficacy or safety profile of this investigational therapy. Moreover, further research is required, and these results must be confirmed in the well-controlled Phase III clinical trial of this investigational therapy that is currently in progress. Subject to completion of that Phase III trial and FDA's review and acceptance of CEL-SCI's entire data set on this investigational therapy, CEL-SCI believes that these early-stage clinical trial results indicate the potential for this investigational therapy to become a treatment for advanced primary head and neck cancer.
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Reported average of 50% reduction in tumor cells in Phase II trials:
The clinical investigators who administered the three week Multikine treatment regimen used in Phase II studies reported that, as was determined in a controlled pathology study, Multikine administration appeared to have caused, on average, the disappearance of about half of the cancer cells present at surgery (as determined by histopathology assessing the area of Stroma/Tumor (Mean+/- Standard Error of the Mean of the number of cells counted per filed)) even before the start of standard therapy such as radiation and chemotherapy (Timar et al JCO 2005).
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Reported 12% complete response in the final Phase II trial:
The clinical investigators who administered the three week Multikine investigational treatment regimen used in the final Phase II study reported that, as was determined in a controlled pathology study, the tumor apparently was no longer present (as determined by histopathology) in approximately 12 % of patients (2 of 17 evaluable by pathology). This determination was made by three pathologists blinded to the study from the surgical specimen after a three week treatment with Multikine (Timar et al JCO 2005).
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Adverse events reported in clinical trials:
In clinical trials conducted to date with the Multikine investigational therapy, adverse events which have been reported by the clinical investigators as possibly or probably related to Multikine administration included pain at the injection site, local minor bleeding and edema at the injection site, diarrhea, headache, nausea, and constipation
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$100,000 upon European Medicines Agency ("EMA") grant of Marketing Authorization for Multikine;
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$50,000 upon Croatia’s grant of reimbursement status for Multikine in Croatia; and
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$50,000 upon Serbia’s grant of reimbursement status for Multikine in Serbia.
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product design, development and manufacture;
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product application and use
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adverse drug experience;
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product advertising and promotion;
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product manufacturing, including good manufacturing practices
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record keeping requirements;
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registration and listing of CEL-SCI's establishments and products with the FDA, EMA and other state and national agencies;
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product storage and shipping;
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drug sampling and distribution requirements;
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electronic record and signature requirements; and
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labeling changes or modifications.
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All actions, including federal securities law claims, would be subject to Article X;
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The phrase “a judgment on the merits” means the determination by a court of competent jurisdiction on the matters submitted to the court;
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The phrase “substantially achieves, in both substance and amount” means the plaintiffs in the action would be awarded at least 90% of the relief sought;
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Only persons who were shareholders at the time an action was brought would be subject to Article X; and
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Only the directors or officers named in the action would be allowed to recover.
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Exhibits | ||||
3(a)
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Articles of Incorporation
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Incorporated by reference to Exhibit 3(a) of CEL-SCI's combined Registration Statement on Form S-1 and Post-Effective Amendment ("Registration Statement"), Registration Nos. 2-85547-D and 33-7531.
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3(b)
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Amended Articles
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Incorporated by reference to Exhibit 3(a) of CEL-SCI's Registration Statement on Form S-1, Registration Nos. 2-85547-D and 33-7531.
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3(c)
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Amended Articles (Name change only)
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Filed as Exhibit 3(c) to CEL-SCI's Registration Statement on Form S-1 Registration Statement (No. 33-34878).
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3(d)
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Bylaws
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Incorporated by reference to Exhibit 3(b) of CEL-SCI's Registration Statement on Form S-1, Registration Nos. 2-85547-D and 33-7531.
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3(e) | Amended Bylaws |
Incorporated by reference to Exhibit 3(ii) of CEL-SCI’s report on Form 8-K dated March 16, 2015.
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4 |
Shareholders Rights Agreement
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Incorporated by reference to Exhibit 4 of CEL-SCI’S report on Form 8-K dated November 7, 2007.
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4(b) |
2014 Incentive Stock Option Plans
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Incorporated by reference to the exhibits filed with the Company’s registration statements on Form S¬8 (File numbers 333-117088, 333-140792, 333-162265, 333-179477, and 333-184092
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4(c) |
Non-Qualified Stock Option Plans
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Incorporated by reference to the exhibits filed with the Company’s registration statements on Form S¬8 (File numbers 333-117088, 333-140792, 333-162265, 333-179477, 333-184092 and 333-198244)
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4(d) |
Stock Bonus Plans
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Incorporated by reference to the exhibits filed with the Company’s registration statements on Form S¬8 (File numbers 333-117088, 333-140792, 333-162265, 333-179477, and 333-184092
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4(e) |
Stock Compensation Plan
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Incorporated by reference to the exhibits filed with the Company’s registration statements on Form S¬8 (File numbers 333-117088, 333-140792, 333-162265, 333-179477, and 333-184092
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4(f) |
2014 Incentive Stock Bonus Plan
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Incorporated by reference to Exhibit 4(c) filed with the Company’s registration statement on Form S-8 (333-198244).
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10(d)
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Employment Agreement with
Maximilian de Clara
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Incorporated by reference to Exhibit 10(d)
of CEL-SCI’s report on Form 8-K (dated April
21, 2005) and Exhibit 10(d) to CEL-SCI’s
report on Form 8-K dated September 8, 2006.
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10(f)
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Securities Purchase Agreement (together
with schedule required by Instruction 2 to
Item 601 of Regulation S-K) pertaining to
Series K notes and warrants, together with t
he exhibits to the Securities Purchase
Agreement
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Incorporated by reference to Exhibit 10 to
CEL-SCI’s report on Form 8-K dated
August 4, 2006.
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10(g)
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Subscription Agreement (together with
Schedule required by Instruction 2 to
Item 601 of Regulation S-K) pertaining to
April 2007 sale of 20,000,000 shares of
CEL-SCI’s common stock, 10,000,000
Series L warrants and 10,000,000 Series M
Warrants
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Incorporated by reference to Exhibit 10 of
CEL-SCI’s report on Form 8-K dated April
18, 2007
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10(h)
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Warrant Adjustment Agreement with
Laksya Ventures
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Incorporated by reference to Exhibit 10(i) of
CEL-SCI’s report on Form 8-K dated August
3, 2010
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10(i)
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Employment Agreement with Patricia
Prichep (2013-2016)
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Incorporated by reference to Exhibit 10(j) of
CEL-SCI’s report on Form 8-K dated August
30, 2013
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10(j)
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Employment Agreement with Eyal Taylor
(2013-2016)
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Incorporated by reference to Exhibit 10(k) of
CEL-SCI’s report on Form 8-K dated August 30, 2013.
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10(k)
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Amendment to Employment Agreement
with Maximilian de Clara
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Incorporated by reference to Exhibit 10(l) of
CEL-SCI’s report on Form 8-K dated August 30, 2010 and Exhibit 10(l) of CEL-SCI’s report on Form 8-K dated August 30, 2013.
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10(l)
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First Amendment to Development Supply
and Distribution Agreement with Orient
Europharma.*
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Incorporated by reference to Exhibit 10(m)
filed with CEL-SCI’s 10-K report for the
year ended September 30, 2010.
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10(m)
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Exclusive License and Distribution Agreement with Teva
Pharmaceutical Industries Ltd.*
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Incorporated by reference to Exhibit 10(n)
filed with CEL-SCI’s 10-K report for the
year ended September 30, 2010.
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10(n)
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Lease Agreement*
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Incorporated by reference to Exhibit 10(o)
filed with CEL-SCI’s 10-K report for the
year ended September 30, 2010.
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10(o)
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Promissory Note with Maximilian de
Clara, together with Amendments 1 and 2
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Incorporated by reference to Exhibit 10(p)
filed with CEL-SCI’s 10-K report for the
year ended September 30, 2010.
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10(p)
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Licensing Agreement with Byron
Biopharma
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Incorporated by reference to Exhibit 10(i) of
CEL-SCI’s report on Form 8-K dated March
27, 2009
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10(q)
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At Market Issuance Sales Agreement
with McNicoll, Lewis & Vlak LLC
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Incorporated by reference to Exhibit 10(r)
filed with CEL-SCI’s 10-K report for the
year ended September 30, 2010
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10(z)
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Development, Supply and Distribution
Agreement with Orient Europharma
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Incorporated by reference to Exhibit 10(z)
filed with CEL-SCI’s report on Form
10-K for the year ended September 30, 2003.
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10(za)
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Employment Agreement with
Geert Kersten. Amendment to
Employment Agreement
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Incorporated by reference to Exhibit 10(za)
to CEL-SCI’s report on Form 8-K dated
September 1, 2011 and Exhibit 10(za) of
CEL-SCI’s report on Form 8-K dated August
30, 2013.
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10(aa)
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Securities Purchase Agreement and
form of the Series F warrants, which is
and exhibit to the Securities Purchase
Agreement
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Incorporated by reference to Exhibit 10(aa)
of CEL-SCI’s report on Form 8-K dated
October 3, 2011.
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10(bb)
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Placement Agent Agreement
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Incorporated by reference to Exhibit 10(bb)
of CEL-SCI’s report on Form 8-K dated
October 3, 2011.
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10(cc)
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Securities Purchase Agreement, together with the form of the Series H warrant, which is an exhibit to the securities Purchase Agreement
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Incorporated by reference to Exhibit 10(cc) of CEL-SCI’s report on Form 8-K dated January 25, 2012.
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10(dd)
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Placement Agent Agreement
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Incorporated by reference to Exhibit 10(dd) of CEL-SCI’s report on Form 8-K dated January 25, 2012.
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10(ee)
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Warrant Amendment Agreement, together with the form of the Series P warrant, which is an exhibit to the Warrant Amendment Agreement
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Incorporated by reference to Exhibit 10(ee) of CEL-SCI’s report on Form 8-K dated February 10, 2012.
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10(ff)
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Placement Agent Agreement
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Incorporated by reference to Exhibit 10(ff) of CEL-SCI’s report on Form 8-K dated February 10, 2012.
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10(gg)
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Securities Purchase Agreement and the form of the Series Q warrant, which is an exhibit to the Securities Purchase Agreement
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Incorporated by reference to Exhibit 10(gg) of CEL-SCI’s report on Form 8-K dated June 18, 2012.
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10(hh)
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Placement Agent Agreement
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Incorporated by reference to Exhibit 10(hh) of CEL-SCI’s report on Form 8-K dated June 18, 2012.
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10 (ii)
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Securities Purchase Agreement and the form of the Series R warrant, which is an exhibit to the Securities Purchase Agreement
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Incorporated by reference to Exhibit 10(ii) of CEL-SCI’s report on Form 8-K dated December 5, 2012.
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10 (jj)
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Placement Agent Agreement
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Incorporated by reference to Exhibit 10(jj) of CEL-SCI’s report on Form 8-K dated December 5, 2012.
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10 (nn)
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Underwriting Agreement, together with the form of Series S warrant which is an exhibit to the underwriting agreement
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Incorporated by reference to Exhibit 1.1 of CEL-SCI’s report on Form 8-K dated October 8, 2013.
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10 (oo)
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Underwriting Agreement, together with the form of Series S warrant which is an exhibit to the underwriting agreement
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Incorporated by reference to Exhibit 1.1 of CEL-SCI’s report on Form 8-K dated December 19, 2013.
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10 (pp)
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Underwriting Agreement, together with the form of Series T warrant which is an exhibit to the warrant agent agreement
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Incorporated by reference to Exhibit 1.1 of CEL-SCI’s report on Form 8-K dated April 15, 2014.
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10 (qq)
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Underwriting Agreement, together with the form of Series S warrant which is an exhibit to the warrant agent agreement
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Incorporated by reference to Exhibit 1.1 of CEL-SCI’s report on Form 8-K dated October 23, 2014.
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10 (rr)
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Assignment and Assumption Agreement with Teva Pharmaceutical Industries, Ltd. and GCP Clinical Studies, Ltd.
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10 (ss)
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Service Agreement with GCP Clinical Studies, Ltd., together with Amendment 1 thereto*
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10 (tt)
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Joinder Agreement with PLIVA Hrvatska d.o.o.
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10 (uu)
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Master Service Agreement with Ergomed Clinical Research, Ltd., and Clinical Trial Orders thereunder
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10 (vv)
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Co-Development and Revenue Sharing Agreement with Ergomed Clinical Research Ltd., dated April 19, 2013, as amended
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10 (ww)
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Co-Development and Revenue Sharing Agreement II: Cervical Intraepithelial Neoplasia in HIV/HPV co-infected women, with Ergomed Clinical Research Ltd., dated October 10, 2013, as amended
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10 (xx)
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Co-Development and Revenue Sharing Agreement III: Anal warts and anal intraepithelial neoplasia in HIV/HPV co-infected patients, with Ergomed Clinical Research Ltd., dated October 24, 2013
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10 (yy)
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Master Services Agreement with Aptiv Solutions, Inc.
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10 (zz)
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Project Agreement Number 1 with Aptiv Solutions, Inc. together with Amendments 1 and 2 thereto*
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10 (aaa)
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Second Amendment to Development Supply and Distribution Agreement with Orient Europharma
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10 (bbb)
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Amended and Restated Promissory Note with Maximilian de Clara
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23.1
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Consent of BDO USA, LLP
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Rule 13a-14(a) Certifications
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Section 1350 Certifications
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CEL-SCI CORPORATION
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By:
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/s/ Maximilian de Clara | |
Maximilian de Clara, President
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Signature
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Title
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Date
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/s/
Maximilian de Clara
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Director
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April 17, 2015
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Maximilian de Clara
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/s/
Geert R. Kersten
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Chief Executive, Principal
Accounting, Principal Financial
Officer and a Director
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April 17, 2015
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Geert R. Kersten
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/s/
Alexander G. Esterhazy
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Director
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April 17, 2015
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Alexander G. Esterhazy
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/s/ Dr. Peter R. Young
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Director
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April 17, 2015
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Dr. Peter R. Young
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(1)
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CEL-SCI CORPORATION,
a corporation incorporated under the laws of the State of Colorado, of and headquartered at 8229 Boone Boulevard, Suite 802, Vienna, VA, 22182, USA
("CEL-SCI");
and
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(2)
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PLIVA Hrvatska d.o.o.,
a corporation, incorporated under the laws of Croatia,
having
its registered office at Prilaz baruna Filipovica 25, HR-10000 Zagreb,
Croatia
(hereinafter
"Pliva");;
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A.
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CEL-SCI and Teva Pharmaceutical Industries Ltd
("TPI")
entered into a License
and
Distribution Agreement for the Product effective as of August 7, 2008
(the
"Agreement").
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B.
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Pliva (a TPI Affiliate) wishes to contract with CEL-SCI for the licensing of the Product in the Territory specified below subject to (i) the terms and conditions of this Joinder Agreement and (ii) the terms and conditions of the Agreement insofar as they are not inconsistent with terms and conditions of this Joinder Agreement.
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1
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DEFINITIONS
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1.1
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Words and expressions which appear in this Joinder Agreement with initial capitalised letters shall, unless expressly defined herein, have the meaning given to such terms in the Agreement.
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1.2
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In this Joinder Agreement:
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2
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TERMS AND CONDITIONS
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2.1
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Except as expressly provided in this Joinder Agreement, all terms and conditions of the Agreement are incorporated herein by reference and made a part of this Joinder Agreement as if set forth in full herein and CEL-SCI and Pliva shall be bound to the same extent and in the same manner as provided under the Agreement with respect to the Product and the Territory covered by this Joinder Agreement. Accordingly where the context so permits, all references to "Agreement" in the License and Distribution Agreement shall be construed as references to this Joinder Agreement and all references to "Teva" in the Agreement shall be construed as references to Pliva under this Joinder Agreement.
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2.2
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In the event of any conflict between the terms and conditions of this Joinder Agreement and the Agreement, the terms and conditions of this Joinder Agreement shall prevail with regard to Pliva as a party.
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2.3
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Pliva shall be responsible for all pharmacovigilance activities for the Product in the Territory according to local requirements in the Territory. This activities include, but are not limited to collection and expedited reporting of single cases, literature search, preparation and submission of Periodic Safety Update Reports, signal detection etc. If CEL-SCI becomes aware of a major safety concern relating to produced batches relevant to this Joinder Agreement, Pliva should be informed without any delay. Pliva shall enter into a direct pharmacovigilance agreement with CEL-SCI before the Product is launched in the Territory, outlining the respective responsibilities of CEL-SCI and Pliva dealing with procedures for monitoring adverse events and safety in respect of the Product, as the same may be amended from time to time by written agreement between CEL-SCI and Pliva.
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3
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DOWN-PAYMENT
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3.1
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In consideration for the rights granted by CEL-SCI to PLIVA under this Joinder Agreement, PLIVA shall pay CEL-SCI a sum of USD 200.000, payable as to:
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USD 100.000- upon European Medicines Agency ("EMA") granting of the Marketing Authorization for the Product;
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USD 50.000- upon grant of the Reimbursement status for the Product in Croatia;
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USD 50.000- upon grant of the Reimbursement status for the Product in Serbia.
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3.2
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GEL-SCI will issue an invoice in respect of each payment. All payments will be made within thirty (30) days from the last day of the month in which the invoice was issued, by bank transfer to a bank account number, provided by GEL-SCI to Pliva sufficient time in advance for such bank transfer.
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3.3
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Pliva will deduct 15% of Croatian Withholding Tax from each payment. Provided that GEL-SCI supplied Pliva with the apostiled Power of Attorney as attached to this Joinder Agreement in the Exhibit A, together with the apostiled Excerpt for CEL-SCI from the respective Court Register, Pliva will open tax number for GEL-SCI before Croatian Tax Authorities and furnish to GEL-SCI the Withholding Tax Certificate upon received request from GEL-SCI.
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3.4
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If the respective regulation change at the time of Pliva's payment to CEL-SCI in comparison to regulation valid at the time of signature of this Joinder Agreement which are described in the previous paragraph, all payments will be performed pursuant to the regulations in force at the moment of payment.
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3.5
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Other than V.A.T. and comparable taxes, all payments by Pliva are inclusive of all taxes and/or duties, of whatsoever nature, which are now or may hereafter be imposed with regard to any such payments, including without limitation withholding taxes.
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4
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ORDERS AND DELIVERIES
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5
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TERMS OF PAYMENT
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6
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NOTICES
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12.5 of the Agreement addressed to Pliva as follows:
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7
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ENTIRE AGREEMENT
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7.1
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This Joinder Agreement, together with the Agreement and the other agreements or documents expressly referenced herein or therein, represent the entire agreement between CEL-SCI and Pliva with respect to the subject matter of this Joinder Agreement.
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7.2
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For the avoidance of doubt, it is hereby agreed and declared that this Joinder Agreement shall not in any way derogate from any right and/or obligation of CEL-SCI, TPI or any other TPI Affiliate insofar as such relate to products and countries not covered under this Joinder Agreement, but covered under the Agreement and/or any other joinder agreement entered into pursuant to the Agreement.
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8
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GOVERNING LAW AND ARBITRATION
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CEL-SCI | PLIVA Hrvatska d.o.o. | |||
/s/Geert Kersten
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/s/ Matko Bolanga, MD
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Title: Chief Executive Officer
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Title:
President of the Management Board
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Date: 18 July 2011 | Date: 19-07-2011 |
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1.1.
For the purposes of this Agreement, the following terms shall have the following meaning:
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a)
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Agreement
shall mean this Agreement and all attached Schedules, and all numbered Annexes to this Agreement to be concluded by the Parties in the future.
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b)
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Schedule
shall mean an integral part of this Agreement added after the signatory page by the time of the signing of the Agreement.
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c)
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Annex
shall mean an addition and/or amendment to the existing Agreement, dated, numbered and signed by both Parties.
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d)
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Affiliate
shall designate any entity which is either owned or controlled, directly or indirectly, in majority by shareholder(s) of each Party respectively or by a subsidiary of any Party in any country.
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e)
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Clinical Trial Order
shall mean a document specifying services that ERGOMED shall provide to COMPANY. All Clinical Trial Orders shall be dated, numbered and signed by both Parties and incorporated either as a Schedule or Annex to this Agreement.
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f)
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Effective Date
shall mean the date of the latter signature of the Parties on the signing page of this Agreement.
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g)
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Clinical Study and/or Trial and/or Project
– a series of activities undertaken to research, develop and/or manufacture a product of COMPANY; or clinical
investigations as are more specifically set out in each Clinical Trial Order.
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h)
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In-Put Material
– all documents, information, materials or other supplies provided by the COMPANY necessary for the provision of the Services.
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i)
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Services
shall mean any and all services to be performed by Ergomed as specified in the relevant Clinical Trial Order as amended from time to time by written agreement between COMPANY and ERGOMED.
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j)
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VAT
– value added tax chargeable under English law for the time being and any similar additional tax.
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a)
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is or becomes public other than by a breach of the Agreement; or
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b)
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is disclosed to professional advisers of the Party engaged to advise the Party in connection with any subject matter of any agreement between the Parties; or
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c)
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is used or disclosed to third parties with the prior written consent of
the other Party
; or
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d)
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was known to the Party
on a non-confidential basis
at the time it was disclosed, other than by previous disclosure by the other Party, as evidenced by the Party’s written records at the time of the disclosure; or
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e)
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is lawfully communicated to
either Party
by
a third party without confidentiality obligation, or is known by either party without use of the other party’s Confidential Information; or
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f)
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is required to be disclosed pursuant to court order or governmental rule or law, provided each Party promptly notifies the other Party of the required disclosure, uses diligent efforts to limit disclosure in any lawful means and to obtain confidential treatment and/or a protective order, if available, and allows the other Party to participate in any proceedings.
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FOR ERGOMED: | FOR COMPANY: | |||
/s /Dr. Miroslav Reljanovic
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/s/ Geert Kersten
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Chief Financial Officer
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Chief Executive Officer
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Date: 4-19-2013
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Date: 4-19-2013
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1.
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DEFINITIONS
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1.1.
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For the purposes of this Agreement, the following terms shall have the following meaning (and all capitalized terms in this Agreement shall be defined according to these definitions):
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●
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credits or allowances granted upon returns, rejections or recalls (due to spoilage, damage, expiration of useful life or otherwise), retroactive price reductions, or billing corrections; invoiced freight, postage, shipping and insurance, handling and other transportation costs actually incurred by CEL-SCI or its Affiliates;
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●
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credits or allowances actually granted, including, without limitation, quantity, cash and other trade discounts, provided, however, that discounts or allowances offered as part of a package of products that includes such Product (other than discounts included in the gross invoice sales amount for Combination Products) sold by CEL-SCI or its Affiliates shall be allocated to such Product on a pro rata basis based upon the sales value (i.e., the unit average selling price multiplied by the unit volume) of such Product relative to the sales value contributed by the other constituent products in the bundled set;
|
●
|
taxes (including, without limitation, sales, value-added or excise taxes), tariffs, customs duties, surcharges and other governmental charges incurred in connection with the production, sale, transportation, delivery, use, exportation or importation of such Product that are incurred at time of sale or are directly related to the sale;
|
●
|
any payments in respect of sales to any governmental authority in respect of any government subsidized program, including without limitation, Medicare and Medicaid rebates;
|
●
|
amounts paid or credited to customers for inventory management, distribution, warehousing and related services;
|
●
|
discounts, refunds, rebates, charge backs, fees, credits or allowances (including, without limitation, billing corrections, amounts incurred in connection with government-mandated rebate and discount programs, Third Party rebates and charge backs, hospital buying group/group purchasing organization administration fees and managed care organization rebates), distribution fees and sales commissions to Third Parties, actually paid or incurred and which effectively reduce the selling price; provided, however, that discounts or allowances offered as part of a package of products that includes such Product (other than discounts included in the gross invoice sales amount for Combination Products) sold by CEL-SCI or its Affiliates shall be allocated to such Product on a pro rata basis based upon the sales value (i.e., the unit average selling price multiplied by the unit volume) of such Product relative to the sales value contributed by the other constituent products in the bundled set;
|
●
|
allowances for bad debts; and
|
●
|
any reasonable deduction that is similar in nature and character to the above and is directly related to the sales of such Product;
|
●
|
any payment that is meant to contribute to the future expenses of the phase III trial from the time of the license of the Product to a third party.
|
2.
|
SUBJECT OF THE AGREEMENT
|
2.1.
|
The primary objective of the Agreement is to regulate the funding of, and coordination of certain decision-making regarding, the Development of the Product through the conduct of the Co-Developed Clinical Trial and related regulatory submissions as contemplated in this and the Master Services Agreement.
|
2.2.
|
CEL-SCI and Ergomed shall undertake their respective obligations under the Co-Development Program on a collaborative basis. CEL-SCI shall have the right to conduct, and, using commercially reasonable efforts, shall have sole responsibility for Non-Clinical Development as well as for Commercialization and intellectual property maintenance of the Product and shall bear all associated costs for such activities. Ergomed, performing in accordance with Good Industry Practice, shall have primary responsibility and bear the associated costs (subject to Sections 3 and 6) for Development of the Product by executing the clinical and regulatory activities in all Europe, Russia and India, all under the Co-Development Program, as stipulated in detail in the CTO I. Accordingly, the Parties shall co-operate in good faith in performing such activities, particularly with respect to unknown problems or contingencies, and shall perform their respective obligations in good faith, in a commercially reasonable manner, and in accordance with the provisions of this Agreement and the MSA.
|
2.3.
|
Notwithstanding any of the above or anything else in the Agreement, CEL-SCI shall at all times and for all purposes act as the sponsor of the Clinical Trial(s) under the applicable Legal Requirements.
|
3.
|
CO-DEVELOPMENT INVESTMENT
|
3.1.
|
With respect to the Product, Ergomed shall invest up to $10 million towards the clinical and regulatory costs determined in the Co-Development Program for the execution of the Co-Developed Clinical Trial for the Product in Europe, Russia and India (the actual amount of such investment, determined in accordance with Section 6) (“Ergomed Co-Development Investment”). The Ergomed Co-Development Investment shall not exceed US$10,000,000 (ten million dollars) for Product Development (the “Ergomed Co-Development Investment Cap”).
|
3.2.
|
With respect to the Product, CEL-SCI shall be solely and fully responsible for all other Development, Non-Clinical Development and Commercialization costs.
|
3.3.
|
Ergomed shall not be obligated to invest more in the Co-Development Program than the amount set forth in clause 3.1. above. If CelSci decides to increase the Program Budget with no agreement from Ergomed as to such increase, then CelSci will bear such increase solely without affecting any of Ergomed’s rights herein.
|
4.
|
CO-MANAGEMENT OF THE CO-DEVELOPMENT PROGRAM
|
4.1.
|
The Parties shall, within ten (10) days of the Effective Date, establish a Joint Steering Committee (the “JSC”) to render strategic and policy decisions for the Development and registration of Product in the Field and to oversee the performance of the Co-Development Program. The responsibilities of the JSC shall be, without limitation to:
|
4.2.
|
The JSC shall consist of four (4) members with the requisite experience and authority to enable them to make decisions on behalf of the Parties, with equal numbers appointed by each respective Party. Each Party shall have the right to replace its respective representatives in JSC upon twenty (20) Business Days written notice to the other Party (or more quickly if such representative’s relationship with the appointing Party has terminated), provided that any such substitute representative shall have substantially the equivalent experience and authority as the representative that such person replaces. CEL-SCI will designate the chairman of the JSC. The JSC shall be run in accordance with the following provisions:
|
4.3.
|
The specific decision to which the provision from Section 4.2.5. does not apply are:
|
4.3.1.
|
changes to the Co-Development Program including any extension of the scope of work therefore. If, following the meeting of Chief Executive Officers of CEL-SCI and Ergomed, the Parties cannot agree upon such changes the Co-Development Program shall continue without amendment.
|
4.3.2.
|
the changes to the Program Budget of the Co-Development Program. If following the meeting of Chief Executive Officers of CEL-SCI and Ergomed, the Parties cannot agree upon such changes the respective Program Budget shall remain as agreed prior to such proposed change and the Co-Development Program shall continue without amendment.
|
5.
|
CO-DEVELOPMENT PROGRAM
|
5.1.
|
Ergomed shall be responsible for carrying out its part of the Co-Development Program, particularly carrying out the Development, all in accordance with the MSA, and the CTO I. The MSA and CTO I shall govern the performance by Ergomed of any Clinical Trials to be carried out by Ergomed under the Co-Development Program.
|
5.2.
|
CEL-SCI shall be responsible for carrying out its part of the Co-Development Program, particularly Non-Clinical Development, Clinical development in territories other than the Europe, Russia and India. Commercialization, manufacturing and IP protection of the Product, all in accordance with the MSA and this Agreement, and all solely at its own cost and expense.
|
6.
|
REVENUE SHARING
|
6.1.
|
CEL-SCI shall make payments to Ergomed for invoices submitted by Ergomed for Ergomed’s activities on the Co-Developed Clinical Trial in accordance with the MSA within the terms stipulated in the MSA and related CTOI; provided, however, that Ergomed’s invoices pursuant to the MSA for each Co-Developed Clinical Trial will be reduced by 30% (thirty percent) from the costs set forth in the MSA and the proposal attached to CTO I (“Ergomed Invoiced Costs”) until the cumulative total of such reductions reaches the Ergomed Co-Development Investment Cap, following which the invoices with respect to the Co-Developed Clinical Trial will be issued and payments will be made with no reduction, all in accordance with the payment schedule set forth in the MSA. The 30% reduction described in the foregoing shall be accrued as the Ergomed Co-Development Investment for the Product and shall be tracked. Each invoice subject to the reduction shall clearly set forth, with respect to the Product, the fee schedule set forth in the MSA and CTO I and the relevant reduction to be applied toward the Ergomed Co-Development Investment.
|
6.2.
|
Notwithstanding anything in this Clause 6, in consideration for the applicable Ergomed Co-Development Investment, CEL-SCI shall pay to Ergomed an agreed percentage of any Net Income received by CEL-SCI for the Product in the Field in the Territory in the amount of 5% (five percent) of such Net Income until the total amount paid to Ergomed under this Section reaches four times (4x) Ergomed Co-Development Investment.
|
6.3.
|
Any payments under Clause 6.2 shall be due and payable by CEL-SCI to Ergomed within sixty (60) days from the date on which CEL-SCI actually records or receives the Net Income; provided, however, that CEL-SCI may, in its sole discretion, pay all or any portion of the amounts owed to Ergomed under this Agreement at any time prior to CEL-SCI’s receipt of the relevant Net Income.
|
6.4.
|
Records Retention; Audit
|
6.4.1.
|
Ergomed shall keep or cause to be kept full, true and accurate records and books of account in accordance with internationally accepted accounting principles that, in reasonable detail, fairly reflect Ergomed’s program costs and the Ergomed Co-Development Investment for the Product. Such books and records shall be maintained by Ergomed for three (3) Years following the end of the Year to which they pertain.
|
6.4.2.
|
Upon the written request of CEL-SCI (the “Requesting Party”), Ergomed (the “Disclosing Party”) shall permit a certified public accountant, or a person possessing similar professional status and associated with an independent accounting firm reasonably acceptable to the Requesting Party, to inspect during regular business hours and no more than once a Year and going back no more than three (3) Years following the end of the Year to which they pertain, all or any part of the records and books necessary to verify such invoices and reports. The accounting firm shall enter into appropriate obligations with the Disclosing Party to treat all information it receives during its inspection in confidence. The accounting firm shall disclose to the Parties only whether
such invoices and reports are correct and details concerning any discrepancies, but no other information shall be disclosed to the Requesting Party. The charges of the accounting firm shall be paid by the Requesting Party, except that if the Ergomed Co-Development Investment for the Product have been overstated by more than five percent (5%), the charges shall be paid by the Disclosing Party. Ergomed shall, within forty-five (45) days after receipt of an invoice from CEL-SCI, pay to CEL-SCI the amount by which the Ergomed Co-Development Investment for the Product has been overstated, along with Interest from the date of the original invoice, and such overstated amount shall be excluded from the Ergomed Co-Development Investment for the Product.
|
6.5.
|
CEL-SCI and its Affiliates shall keep full, true and accurate records and books of account in accordance with GAAP or IFRS containing all particulars that may be reasonably necessary for the purpose of calculating the share of Net Income payable to Ergomed under this Agreement. Such books and records shall be maintained for three (3) Years following the end of the Year to which they pertain. Upon the written request by Ergomed, Ergomed shall have the right to instruct an independent, internationally recognized, accounting firm reasonably acceptable to CEL-SCI, to perform an audit, conducted so far as appropriate in accordance with GAAP or IFRS, as applicable, during regular business hours and no more than once a Year, as is reasonably necessary to enable such accounting firm to report to Ergomed Net Income for the period or periods requested by Ergomed going back no more than three (3) Years following the end of the Year to which the records pertain. The accounting firm shall enter into appropriate obligations with CEL-SCI to treat all information it receives during its inspection in confidence. The accounting firm shall disclose to the Parties only whether CEL-SCI has paid to Ergomed the proper portion of Net Income with respect to the Product and details concerning any discrepancies, but no other information shall be disclosed to Ergomed. The cost of the accountant shall be the responsibility of CEL-SCI if the audit shows that CEL-SCI has underpaid Ergomed its proper portion of Net Income by more than five percent (5%) with respect to the Product and the responsibility of Ergomed otherwise. CEL-SCI shall, within forty-five (45) days after receipt of an invoice from Ergomed, pay to Ergomed the amount by which the portion of Net Income for the Product owed to Ergomed was underpaid, along with Interest from the date of CEL-SCI’s original receipt thereof.
|
6.6.
|
All payments made by CEL-SCI to Ergomed under this Agreement shall be made by wire transfer to the account of Ergomed that may be notified by Ergomed to CEL-SCI from time to time.
|
6.7.
|
If CEL-SCI fails to make any payment due to Ergomed hereunder on the due date for payment, without prejudice to any other right or remedy available to Ergomed, Ergomed shall be entitled to charge CEL-SCI Interest (both before and after judgment, from the date payment was originally due through the date paid) without prejudice to Ergomed’s right to receive payment on the due date. If Ergomed overcharges CEL-SCI, without prejudice to any other right or remedy available to CEL-SCI, CEL-SCI shall be entitled to charge Ergomed Interest (both before and after judgment, from the date payment was originally made through the date refunded).
|
7.
|
WARRANTIES
|
7.1.
|
Warranties of CEL-SCI
|
a)
|
CEL-SCI is a company duly incorporated and validly existing under the laws of Colorado and has the corporate power to own its assets, conduct its business as presently conducted and to enter into, and comply with its obligations under this Agreement;
|
b)
|
this Agreement has been duly authorized and executed by CEL-SCI and constitutes a valid and legally binding obligation of CEL-SCI, enforceable in accordance with its terms;
|
c)
|
CEL-SCI is not engaged in, and so far as CEL-SCI is aware (having made no enquiry) is not threatened by, any litigation, the outcome of which might adversely affect its financial position or the execution of the rights and obligations undertaken by this Agreement;
|
d)
|
the execution, delivery and performance by CEL-SCI of this Agreement and compliance with the provisions hereof by CEL-SCI will not:
|
(i)
|
violate any provision of applicable law, statute, rule or regulation or any ruling, writ, injunction, order, judgment or decree of any court, arbitrator, administrative agency or other governmental body applicable to CEL-SCI or any of its properties or assets;
|
(ii)
|
conflict with or result in any breach of any of the terms, conditions or provisions of, or constitute (with notice or lapse of time or both) a default (or give rise to any right of termination, cancellation or acceleration) under the organizational documents of CEL-SCI or any contract to which CEL-SCI is a party; or
|
(iii)
|
result in the creation of any Encumbrance of any nature granted to a Third Party upon any of the properties or assets of CEL-SCI;
|
e)
|
With respect to the Patents set forth on Schedule A pertaining to the Product, (i) CEL-SCI is the registered owner thereof, which rights are free of any Encumbrances, restrictions or Third Party rights, (ii) such Patents are in full force and effect, and (iii) there are no licenses or rights to use such Patents granted by CEL-SCI to any Third Party that are in effect as of the Effective Date that are in conflict with the terms of this Agreement; and
|
f)
|
CEL-SCI has not received any written claim from a Third Party alleging that the manufacture or commercialization of the Product infringes a Patent of such Third Party;
|
g)
|
CEL-SCI has obtained all necessary corporate approvals, including but not limited to the Board approval, and has obtained the funds necessary to carry out the Co-Development Program.
|
7.2.
|
Warranties of Ergomed
|
a)
|
Ergomed is a company duly incorporated and validly existing under the laws of the United Kingdom and has the corporate power to own its assets, conduct its business as presently conducted and to enter into, and comply with its obligations under this Agreement;
|
b)
|
this Agreement has been duly authorized and executed by Ergomed and constitutes a valid and legally binding obligation of Ergomed, enforceable in accordance with its terms;
|
c)
|
Ergomed is not engaged in, and so far as Ergomed is aware (having made no enquiry) is not threatened by, any litigation, the outcome of which might adversely affect its financial position or the execution of the rights and obligations undertaken by this Agreement; and
|
d)
|
the execution, delivery and performance by Ergomed of this Agreement and compliance with the provisions hereof by Ergomed will not:
|
(i)
|
violate any provision of applicable law, statute, rule or regulation or any ruling, writ, injunction, order, judgment or decree of any court, arbitrator, administrative agency or other governmental body applicable to Ergomed or any of its properties or assets;
|
(ii)
|
conflict with or result in any breach of any of the terms, conditions or provisions of, or constitute (with notice or lapse of time or both) a default (or give rise to any right of termination, cancellation or acceleration) under the organizational documents of Ergomed or any contract to which Ergomed is a party; or
|
(iii)
|
result in the creation of any Encumbrance of any nature granted to a Third Party upon any of the properties or assets of Ergomed.
|
8.
|
PARTICULAR COVENANTS
|
8.1.
|
Positive covenants
|
8.1.1.
|
Each Party shall inform the other Party of all relevant information which may be significant for the Product that the other Party has a need to know in connection with the Co-Development Program which it receives or develops independently of the other Party. This shall be accomplished through representatives on the JSC.
|
9.
|
CONFIDENTIALITY
|
|
9.1. The Parties agree that the MSA shall govern with respect to “Confidential Information” (as defined in the MSA) that may be exchanged between the Parties under the MSA. Any Confidential Information of either Party (as defined below) that may be exchanged between the Parties under this Agreement and except to the extent expressly authorized by this Agreement or otherwise agreed in writing, the Parties agree that, during the validity of the Agreement and for ten (10) years thereafter, the receiving Party (the “
Receiving Party
”) shall keep confidential and shall not publish or otherwise disclose or use for any purpose other than as permitted under, or required to perform its obligations under, this Agreement any financial information and materials furnished to it by the other Party (the “
Disclosing Party
”) pursuant to this Agreement (collectively, “
Confidential Information
”), except to the extent that it can be established by the Receiving Party that such Confidential Information:
|
●
|
was already known to the Receiving Party, other than under an obligation of confidentiality, at the time of disclosure by the Disclosing Party;
|
●
|
was generally available to the public or otherwise part of the public domain at the time of its disclosure to the Receiving Party;
|
●
|
became generally available to the public or otherwise part of the public domain after its disclosure to the Receiving Party and other than through any act or omission of the Receiving Party in breach of this Agreement;
|
●
|
was disclosed to the Receiving Party, other than under an obligation of confidentiality, by a Third Party who had no obligation to the Disclosing Party not to disclose such information to others; or
|
●
|
was subsequently developed by the Receiving Party without the aid, use or application of the Disclosing Party’s Confidential Information as demonstrated by competent written records.
|
10.
|
ASSIGNMENT
|
10.1.
|
This Agreement may not be assigned, transferred or subcontracted by either Party without the prior written consent of the other Party, which consent shall not be unreasonably withheld; provided, however, that either Party may assign this Agreement, in whole or in part, without the other Party’s consent to an Affiliate, or in connection with a merger, consolidation, acquisition or a sale or transfer of all or substantially all of such Party’s assets to which this Agreement relates.
|
10.2.
|
Each Party shall as soon as practicable notify the other Party of an assignment to an Affiliate or of a Change of Control and shall provide the other Party with information reasonably requested by
such Party with respect to such Affiliate or acquirer. “Change of Control” means: (a) the acquisition by any third party of beneficial ownership of fifty percent (50%) or more of the then-outstanding common shares or voting power of a Party; or (b) the consummation of a business combination involving a Party, unless, following such business combination, the stockholders of a Party immediately prior to such business combination beneficially own directly or indirectly more than fifty percent (50%) of the then-outstanding common shares or voting power of the entity resulting from such business combination. Any assignment not in accordance with the foregoing shall be void.
|
11.
|
PRESS RELEASES
|
11.1.
|
The Parties will not publicly disclose the nature or existence of this Agreement, through press releases, a web site, brochures, or written materials of any kind, unless differently agreed by both Parties in writing or unless required by the law or by the rules of any stock exchange which apply to a Party.
|
12.
|
NOTICES
|
12.1.
|
Any notices required or to be sent hereunder shall be in writing and delivered personally or sent by fax or mail or e-mail, at the sender’s choice. Notices delivered to the addresses, fax numbers or e-mail addresses indicated below (or such other address, fax number or e-mail address of which the receiving Party had notified the other Party in writing, in accordance with the procedures of this Section 12.1, at least 8 (eight) days prior to such delivery) shall be considered validly delivered and shall be considered received on the date of actual receipt; provided, however, that notices sent by fax shall be deemed given as of the date sent by fax properly addressed and transmitted.
|
13.
|
TERM AND TERMINATION
|
|
13.1 The term of this Agreement shall commence on the Effective Date and shall expire on the date on which both Parties have fulfilled all of their obligations contemplated herein. For the avoidance of doubt, the Agreement cannot be terminated by either of the Parties prior to its expiration unless specifically and expressly stipulated in the Agreement or unless agreed in writing by both Parties.
|
13.2.
|
For the sake of clarity, the Parties agree and acknowledge that the expiration or termination of this Agreement shall not affect in any way the validity of the MSA or the relevant CTO therein, which shall, to the extent applicable, continue in full force and effect unless terminated pursuant to the relevant clauses in the MSA or such CTO.
|
13.3.
|
In case that either the MSA and / or any relevant CTO thereunder are terminated, this Agreement shall continue to apply to the Parties taking into account such fact of termination of MSA and / or the Exhibit and performance on any obligations of the Parties directly and solely related to the obligations under the MSA or the CTO shall no longer be required from either of the Parties. For the avoidance of doubt, in this case, the provisions stipulated in Sections 6, 9, 12 and 14 shall remain in full force and effect.
|
14.
|
DISPUTE RESOLUTION AND GOVERNING LAW
|
14.1.
|
General
.
The Parties recognize that disputes as to certain matters may from time to time arise which relate to either Party’s rights and/or obligations hereunder. It is the objective of the Parties to establish procedures to facilitate the resolution of disputes arising under this Agreement in an expedient manner by mutual dialogue and cooperation and, to extent possible, without resort to litigation. To accomplish this objective, the Parties agree to follow the procedures set forth in this Article 14 if and when a dispute arises under this Agreement.
|
14.2.
|
Senior Management
. Any disputes relating to this Agreement shall be first referred to the Chief Executive Officer of CEL-SCI and the Chief Executive Officer of Ergomed, or their respective senior-level designees, for resolution through good faith negotiations. In the event that such executives, or their respective designees, cannot resolve the dispute within thirty (30) days of being requested by a Party to resolve a dispute, either Party may, by written notice to the other, invoke the provisions of Section 14.3 hereinafter.
|
14.3.
|
Mediation
.
The Parties agree that any dispute, controversy or claim (except as to any issue relating to Confidential Information or intellectual property owned in whole or in part by Ergomed or CEL-SCI or any equitable claim) arising out of or relating to this Agreement, or the breach, termination, or invalidity thereof, shall be resolved through mediation and binding arbitration. If a dispute arises out of or relating to this Agreement between the Parties, and if such dispute cannot be resolved pursuant to Section 14.2 above, the Parties agree to try in good faith to resolve such dispute by mediation administered by the American Arbitration Association (AAA) in accordance with its Mediation Rules. Such mediation shall take place in New York, New York if personal appearance is required.
|
14.4.
|
Injunctive Relief, Collection of Amounts Due and Express Dispute Resolution Provisions
. Notwithstanding the foregoing provisions of this Article 14, (a) either Party will have the right to seek injunctive relief and/or collection of any undisputed amount due under this Agreement in any court of competent jurisdiction as may be available to such Party under the laws and rules applicable in such jurisdiction, and (b) the provisions of Sections 14.1-14.4 shall not apply with respect to any decision described in Section 4.3.
|
14.5.
|
Governing Law
. This Agreement and all disputes thereof shall be governed by and construed in accordance with the substantive laws of the State of New York, USA other than any principle of conflict or choice of laws that would cause the application of the laws of any other jurisdiction.
|
15.
|
FINAL PROVISIONS
|
15.1.
|
If any provision of this Agreement should be deemed invalid or legally unenforceable, such provision shall not affect the validity and/or enforceability of any other provision(s) of this Agreement or the Agreement as a whole. The Parties shall, in such case, replace the invalid provision with a valid one that best expresses their original intent.
|
15.2.
|
This Agreement (which includes its Schedules) and the MSA and the relevant CTO thereunder contain the entire and only agreement between the Parties with respect to the subject of the Agreement and wholly cancel, terminate and supersede any agreement or agreements, formal or informal, oral or written heretofore entered into pertaining to the subject matter, including the Confidentiality, Non-Disclosure and Non-Solicitation Agreement between the parties dated as of December 11, 2012. Notwithstanding the foregoing, the Parties agree and acknowledge that the MSA and the CTO I thereunder, if entered into prior to this Agreement, shall survive the execution of this Agreement
|
15.3.
|
If a Party (the “Affected Party”) is unable to carry out any of its obligations under this Agreement due to Force Majeure this Agreement shall remain in effect but the Affected Party’s relevant obligations under this Agreement and the corresponding obligations of the other Party (“Non-Affected Party”) under this Agreement, shall be suspended for a period equal to the circumstance of Force Majeure provided that:
|
15.3.1.
|
the suspension of performance is of no greater scope than is required by the Force Majeure;
|
15.3.2.
|
the Affected Party immediately gives the Non-Affected Party prompt written notice describing the circumstance of Force Majeure, including the nature of the occurrence and its expected duration, and continues to furnish regular reports during the period of Force Majeure and notifies the Non-Affected Party immediately of the cessation of the Force Majeure;
|
15.3.3.
|
the Affected Party uses all reasonable efforts to remedy its inability to perform and to mitigate the effects of the circumstance of Force Majeure; and
|
15.3.4.
|
as soon as practicable after the event which constitutes Force Majeure the Parties discuss how best to continue their operations as far as possible in accordance with this Agreement.
|
15.4.
|
The status of each Party under this Agreement shall be that of an independent contractor. Nothing contained in this Agreement shall be construed as creating a partnership, joint venture or agency relationship between the Parties or as granting either Party the authority to bind or contract any obligation in the name of or on the account of the other Party or to make any statements, representations, warranties or commitments on behalf of the other Party. All persons employed by a Party shall be employees of such Party and not of the other Party and all costs and obligations incurred by reason of any such employment shall be for the account and expense of such Party.
|
15.5.
|
This Agreement is written and executed in the English language.
|
15.6.
|
Any amendment or modification of this Agreement must be in writing and signed by authorized representatives of both Parties.
|
15.7.
|
A Party’s failure to enforce, at any time or for any period of time, any provision of this Agreement, or to exercise any right or remedy shall not constitute a waiver of that provision, right or remedy or prevent such Party from enforcing any or all provisions of this Agreement and exercising any rights or remedies. To be effective any waiver must be in writing. All rights and remedies are cumulative and do not exclude any other right or remedy provided by law or otherwise available.
|
15.8.
|
The provisions of this Agreement are for the sole benefit of the Parties and their successors and permitted assigns, and they shall not be construed as conferring any rights in any other Persons except as otherwise expressly provided. Except as expressly provided herein, no person who is not a party to this Agreement (including any employee, officer, agent, representative or subcontractor of either Party) shall have the right to enforce any term of this Agreement which expressly or by implication confers a benefit on that person without the express prior agreement in writing of the Parties, which agreement must refer to this Clause 15.8.
|
15.9.
|
Each Party shall perform all further acts and things and execute and deliver such further documents as may be necessary or as the other Party may reasonably require to implement or give effect to this Agreement.
|
15.10.
|
Except as otherwise expressly provided in this Agreement, each Party shall pay the fees and expenses of its respective lawyers and other experts and all other expenses and costs incurred by such Party incidental to the negotiation, preparation, execution and delivery of this Agreement.
|
15.11.
|
This Agreement may be executed in any number of counterparts, each of which shall be deemed an original and all of which taken together shall be deemed to constitute one and the same instrument. An executed signature page of this Agreement delivered by facsimile transmission shall be as effective as an original executed signature page. Signatures to this Agreement transmitted by electronic mail in “portable document format” (“.pdf”) form, or by any other electronic means intended to preserve the originals graphic and pictorial appearance of a document, will have the same effect as physical delivery of the paper document bearing the original signatures, and shall be deemed original signatures by both Parties.
|
15.12.
|
In construing this Agreement, unless expressly specified otherwise, (a) except where the context otherwise requires, use of any gender includes any other gender, and use of the singular includes
|
CEL-SCI CORPORATION
|
ERGOMED CLINICAL RESEARCH LTD
|
|||
/s/ Geert Kersten
|
/s/ Dr. Miroslav Reljanovic
|
|||
Print Name:
Geert Kersten
|
Print Name:
Dr. Miroslav Reljanovic
|
|||
Title:
Chief Executive Officer
|
Title:
Chief Financial Officer
|
1.
|
DEFINITIONS
|
1.1.
|
For the purposes of this Agreement, the following terms shall have the following meaning (and all capitalized terms in this Agreement shall be defined according to these definitions):
|
●
|
credits or allowances granted upon returns, rejections or recalls (due to spoilage, damage, expiration of useful life or otherwise), retroactive price reductions, or billing corrections;
|
●
|
invoiced freight, postage, shipping and insurance, handling and other transportation costs actually incurred by CEL-SCI or its Affiliates;
|
●
|
credits or allowances actually granted, including, without limitation, quantity, cash and other trade discounts, provided, however, that discounts or allowances offered as part of a package of products that includes such Product (other than discounts included in the gross invoice sales amount for Combination Products) sold by CEL-SCI or its Affiliates shall be allocated to such Product on a pro rata basis based upon the sales value (i.e., the unit average selling price multiplied by the unit volume) of such Product relative to the sales value contributed by the other constituent products in the bundled set;
|
●
|
taxes (including, without limitation, sales, value-added or excise taxes), tariffs, customs duties, surcharges and other governmental charges incurred in connection with the production, sale, transportation, delivery, use, exportation or importation of such Product that are incurred at time of sale or are directly related to the sale;
|
●
|
any payments in respect of sales to any governmental authority in respect of any government subsidized program, including without limitation, Medicare and Medicaid rebates;
|
●
|
amounts paid or credited to customers for inventory management, distribution, warehousing and related services;
|
●
|
discounts, refunds, rebates, charge backs, fees, credits or allowances (including, without limitation, billing corrections, amounts incurred in connection with government-mandated rebate and discount programs, Third Party rebates and charge backs, hospital buying group/group purchasing organization administration fees and managed care organization rebates), distribution fees and sales commissions to Third Parties, actually paid or incurred and which effectively reduce the selling price; provided, however, that discounts or allowances offered as part of a package of products that includes such Product (other than discounts included in the gross invoice sales amount for Combination Products) sold by CEL-SCI or its
Affiliates shall be allocated to such Product on a pro rata basis based upon the sales value (i.e., the unit average selling price multiplied by the unit volume) of such Product relative to the sales value contributed by the other constituent products in the bundled set;
|
●
|
allowances for bad debts; and
|
●
|
any reasonable deduction that is similar in nature and character to the above and is directly related to the sales of such Product;
|
●
|
any payment that is meant to contribute to the future expenses of clinical development from the time of the license of the Product to a third party.
|
2.
|
SUBJECT OF THE AGREEMENT
|
2.1.
|
The primary objective of the Agreement is to regulate the funding of, and coordination of certain decision-making regarding the Development of the Product through the conduct of the Co-Developed Clinical Trial(s) and related regulatory submissions as contemplated in this and the Master Services Agreement.
|
2.2.
|
CEL-SCI and Ergomed shall undertake their respective obligations under the Co-Development Program on a collaborative basis. CEL-SCI shall have the right to conduct, and, using commercially reasonable efforts, shall have sole responsibility for Non-Clinical Development as well as for Commercialization and intellectual property maintenance of the Product and shall bear all associated costs for such activities. Ergomed, performing in accordance with Good Industry Practice, shall have primary responsibility and bear the associated costs (subject to Sections 3 and 6) for Development of the Product by executing the clinical and regulatory activities under the Co-Development Program 2, as further stipulated in detail in the CTO 2. Accordingly, the Parties shall co-operate in good faith in performing such activities, particularly with respect to unknown problems or contingencies, and shall perform their respective obligations in good faith, in a commercially reasonable manner, and in accordance with the provisions of this Agreement and the MSA.
|
2.3.
|
Notwithstanding any of the above or anything else in the Agreement, CEL-SCI shall at all times and for all purposes act as the sponsor of the Clinical Trial(s) under the applicable Legal Requirements.
|
3.
|
CO-DEVELOPMENT INVESTMENT
|
3.1.
|
Subject to the conclusion of CTO 2 and with respect to the Product Development in CIN Indication, Ergomed shall invest up to $3 million towards the clinical and regulatory costs
|
3.2.
|
With respect to the Product, CEL-SCI shall be solely and fully responsible for all other Development, Non-Clinical Development and Commercialization costs.
|
3.3.
|
Ergomed shall not be obligated to invest more in the Co-Development Program 2 than the amount set forth in clause 3.1. above. If CEL-SCI decides to increase the Program Budget with no agreement from Ergomed as to such increase, then CEL-SCI will bear such increase solely without affecting any of Ergomed’s rights herein.
|
4.
|
CO-MANAGEMENT OF THE CO-DEVELOPMENT PROGRAM
|
4.1.
|
The Parties shall, within ten (10) days of the Effective Date, establish a Joint Steering Committee (the “JSC”) to render strategic and policy decisions for the Development and registration of Product in the Field and to oversee the performance of the Co-Development Program 2. For the avoidance of doubt, and unless specifically agreed otherwise by the Parties in writing, the JSC already existing under the Co-Development Agreement for the Head and Neck Indication shall act also as the JSC under this Agreement. The responsibilities of the JSC shall be, without limitation to:
|
4.2.
|
The JSC shall consist of four (4) members with the requisite experience and authority to enable them to make decisions on behalf of the Parties, with equal numbers appointed by each respective Party. Each Party shall have the right to replace its respective representatives in JSC upon twenty (20) Business Days written notice to the other Party (or more quickly if such representative’s relationship with the appointing Party has terminated), provided that any such substitute representative shall have substantially the equivalent experience and authority as the representative that such person replaces. CEL-SCI will designate the chairman of the JSC. The JSC shall be run in accordance with the following provisions:
|
4.3
|
The specific decision to which the provision from Section 4.2.5. does not apply are:
|
4.3.1
|
changes to the Co-Development Program 2 including any extension of the scope of work therefore. If, following the meeting of Chief Executive Officers
|
4.3.2
|
the changes to the Program Budget of the Co-Development Program 2. If following the meeting of Chief Executive Officers of CEL-SCI and Ergomed, the Parties cannot agree upon such changes the respective Program Budget shall remain as agreed prior to such proposed change and the Co-Development Program 2 shall continue without amendment.
|
5
|
CO-DEVELOPMENT PROGRAM
|
5.1
|
Ergomed shall be responsible for carrying out its part of the Co-Development Program 2, particularly carrying out the Development, all in accordance with the MSA, and the CTO 2. The MSA and CTO 2 shall govern the performance by Ergomed of any Clinical Trials to be carried out by Ergomed under the Co-Development Program 2.
|
5.2
|
CEL-SCI shall be responsible for carrying out its part of the Co-Development Program 2, particularly Non-Clinical Development. Commercialization, manufacturing and IP protection of the Product, all in accordance with the MSA and this Agreement, and all solely at its own cost and expense.
|
6
|
REVENUE SHARING
|
6.1
|
CEL-SCI shall make payments to Ergomed for invoices submitted by Ergomed for Ergomed’s activities on the Co-Developed Clinical Trial in accordance with the MSA within the terms stipulated in the MSA and related CTO 2; provided, however, that Ergomed’s invoices pursuant to the MSA for each Co-Developed Clinical Trial in CIN Indication will be reduced by 50% (fifty percent) from the costs set forth in the MSA and the proposal attached to CTO 2 (“Ergomed Invoiced Costs 2”) until the cumulative total of such reductions reaches the Ergomed Co-Development Investment Cap CIN, following which the invoices with respect to the Co-Developed Clinical Trial for CIN Indication will be issued and payments will be made with no reduction, all in accordance with the payment schedule set forth in the MSA. The 50% reduction described in the foregoing shall be accrued as the Ergomed Co-Development Investment CIN for the Product and shall be tracked. Each invoice subject to the reduction shall clearly set forth, with respect to the Product, the fee schedule set forth in the MSA and CTO 2 and the relevant reduction to be applied toward the Ergomed Co-Development Investment CIN.
|
6.2
|
Notwithstanding anything in this Clause 6, in consideration for the applicable Ergomed Total Co-Development Investment, CEL-SCI shall pay to Ergomed an agreed percentage of any Net Income received by CEL-SCI for the Product in the Field in the Territory in the amount of 5% (five percent) of such Net Income until the total amount paid to Ergomed under this Section reaches four times (4x) Ergomed Total Co-Development Investment.
|
6.3
|
It is noted that Ergomed and CEL-SCI are jointly developing the Product for several Indications governed in two separate co-development agreements. The Ergomed Total Co-Development Investment shall be accrued collectively through the efforts in all Indications and the Revenues described in section 6.2 calculated on the basis of the Ergomed Total Co-Development Investment. As an illustration and for clarity, in the event that Ergomed invests $10 million in Head and Neck Cancer, and $3 million in CIN, the Total Ergomed Co-Development Investment will be $13 million and the maximum total Ergomed revenue will be
$52 million, received from all Net Income from all Product sales from either or both Head and Neck Cancer and CIN.
|
6.4
|
Any payments under Clause 6.2 shall be due and payable by CEL-SCI to Ergomed within sixty (60) days from the date on which CEL-SCI actually records or receives the Net Income; provided, however, that CEL-SCI may, in its sole discretion, pay all or any portion of the amounts owed to Ergomed under this Agreement or any other co-development agreement for the Product at any time prior to CEL-SCI’s receipt of the relevant Net Income.
|
6.5
|
Records Retention; Audit
|
6.5.1
|
Ergomed shall keep or cause to be kept full, true and accurate records and books of account in accordance with internationally accepted accounting principles that, in reasonable detail, fairly reflect Ergomed’s program costs and the Ergomed Co-Development Investment for the Product. Such books and records shall be maintained by Ergomed for three (3) Years following the end of the Year to which they pertain.
|
6.5.2
|
Upon the written request of CEL-SCI (the “Requesting Party”), Ergomed (the “Disclosing Party”) shall permit a certified public accountant, or a person possessing similar professional status and associated with an independent accounting firm reasonably acceptable to the Requesting Party, to inspect during regular business hours and no more than once a Year and going back no more than three (3) Years following the end of the Year to which they pertain, all or any part of the records and books necessary to verify such invoices and reports. The accounting firm shall enter into appropriate obligations with the Disclosing Party to treat all information it receives during its inspection in confidence. The accounting firm shall disclose to the Parties only whether such invoices and reports are correct and details concerning any discrepancies, but no other information shall be disclosed to the Requesting Party. The charges of the accounting firm shall be paid by the Requesting Party, except that if the Ergomed Co-Development Investment for the Product have been overstated by more than five percent (5%), the charges shall be paid by the Disclosing Party. Ergomed shall, within forty-five (45) days after receipt of an invoice from CEL-SCI, pay to CEL-SCI the amount by which the Ergomed Co-Development Investment for the Product has been overstated, along with Interest from the date of the original invoice, and such overstated amount shall be excluded from the Ergomed Co-Development Investment for the Product.
|
6.6
|
CEL-SCI and its Affiliates shall keep full, true and accurate records and books of account in accordance with GAAP or IFRS containing all particulars that may be reasonably necessary for the purpose of calculating the share of Net Income payable to Ergomed under this Agreement. Such books and records shall be maintained for three (3) Years following the end of the Year to which they pertain. Upon the written request by Ergomed, Ergomed shall have the right to instruct an independent, internationally recognized, accounting firm reasonably acceptable to CEL-SCI, to perform an audit, conducted so far as appropriate in accordance with GAAP or IFRS, as applicable, during regular business hours and no more than once a Year, as is reasonably necessary to enable such accounting firm to report to Ergomed Net Income for the period or periods requested by Ergomed going back no more than three (3) Years following the end of the Year to which the records pertain. The accounting firm shall enter into appropriate obligations with CEL-SCI to treat all information it receives during its inspection in confidence. The accounting firm shall disclose to the Parties only whether CEL-SCI has paid to Ergomed the proper portion of Net Income with respect to the Product and details concerning any discrepancies, but no other information shall be disclosed to Ergomed.
|
6.7
|
All payments made by CEL-SCI to Ergomed under this Agreement shall be made by wire transfer to the account of Ergomed that may be notified by Ergomed to CEL-SCI from time to time.
|
6.8
|
If CEL-SCI fails to make any payment due to Ergomed hereunder on the due date for payment, without prejudice to any other right or remedy available to Ergomed, Ergomed shall be entitled to charge CEL-SCI Interest (both before and after judgment, from the date payment was originally due through the date paid) without prejudice to Ergomed’s right to receive payment on the due date. If Ergomed overcharges CEL-SCI, without prejudice to any other right or remedy available to CEL-SCI, CEL-SCI shall be entitled to charge Ergomed Interest (both before and after judgment, from the date payment was originally made through the date refunded).
|
7
|
WARRANTIES
|
7.1
|
Warranties of CEL-SCI
|
a)
|
CEL-SCI is a company duly incorporated and validly existing under the laws of Colorado and has the corporate power to own its assets, conduct its business as presently conducted and to enter into, and comply with its obligations under this Agreement;
|
b)
|
this Agreement has been duly authorized and executed by CEL-SCI and constitutes a valid and legally binding obligation of CEL-SCI, enforceable in accordance with its terms;
|
c)
|
CEL-SCI is not engaged in, and so far as CEL-SCI is aware (having made no enquiry) is not threatened by, any litigation, the outcome of which might adversely affect its financial position or the execution of the rights and obligations undertaken by this Agreement;
|
d)
|
the execution, delivery and performance by CEL-SCI of this Agreement and compliance with the provisions hereof by CEL-SCI will not:
|
(i)
|
violate any provision of applicable law, statute, rule or regulation or any ruling, writ, injunction, order, judgment or decree of any court, arbitrator, administrative agency or other governmental body applicable to CEL-SCI or any of its properties or assets;
|
(ii)
|
conflict with or result in any breach of any of the terms, conditions or provisions of, or constitute (with notice or lapse of time or both) a default (or give rise to any right of termination, cancellation or acceleration) under the organizational documents of CEL-SCI or any contract to which CEL-SCI is a party; or
|
(iii)
|
result in the creation of any Encumbrance of any nature granted to a Third Party upon any of the properties or assets of CEL-SCI;
|
e)
|
With respect to the Patents set forth on Schedule A pertaining to the Product, (i) CEL-SCI is the registered owner thereof, which rights are free of any Encumbrances, restrictions or Third Party rights, (ii) such Patents are in full force and effect, and (iii) there are no
|
f)
|
CEL-SCI has not received any written claim from a Third Party alleging that the manufacture or commercialization of the Product infringes a Patent of such Third Party; and
|
g)
|
CEL-SCI has obtained all necessary corporate approvals, including but not limited to the Board approval, and has obtained the funds necessary to carry out the Co-Development Program 2.
|
7.2
|
Warranties of Ergomed
|
a)
|
Ergomed is a company duly incorporated and validly existing under the laws of the United Kingdom and has the corporate power to own its assets, conduct its business as presently conducted and to enter into, and comply with its obligations under this Agreement;
|
b)
|
this Agreement has been duly authorized and executed by Ergomed and constitutes a valid and legally binding obligation of Ergomed, enforceable in accordance with its terms;
|
c)
|
Ergomed is not engaged in, and so far as Ergomed is aware (having made no enquiry) is not threatened by, any litigation, the outcome of which might adversely affect its financial position or the execution of the rights and obligations undertaken by this Agreement; and
|
d)
|
the execution, delivery and performance by Ergomed of this Agreement and compliance with the provisions hereof by Ergomed will not:
|
(i)
|
violate any provision of applicable law, statute, rule or regulation or any ruling, writ, injunction, order, judgment or decree of any court, arbitrator, administrative agency or other governmental body applicable to Ergomed or any of its properties or assets;
|
(ii)
|
conflict with or result in any breach of any of the terms, conditions or provisions of, or constitute (with notice or lapse of time or both) a default (or give rise to any right of termination, cancellation or acceleration) under the organizational documents of Ergomed or any contract to which Ergomed is a party; or
|
(iii)
|
result in the creation of any Encumbrance of any nature granted to a Third Party upon any of the properties or assets of Ergomed.
|
8
|
PARTICULAR COVENANTS
|
8.1
|
Positive covenants
|
8.1.1
|
Each Party shall inform the other Party of all relevant information which may be significant for the Product that the other Party has a need to know in connection with the Co-Development Program which it receives or develops independently of the other Party. This shall be accomplished through representatives on the JSC.
|
9
|
CONFIDENTIALITY
|
5.1.
|
The Parties agree that the MSA shall govern with respect to “Confidential Information” (as defined in the MSA) that may be exchanged between the Parties under the MSA. Any Confidential Information of either Party (as defined below) that may be exchanged between the Parties under this Agreement and except to the extent expressly authorized by this Agreement or otherwise agreed in writing, the Parties agree that, during the validity of the Agreement and for ten (10) years thereafter, the receiving Party (the “
Receiving Party
”) shall keep confidential and shall not publish or otherwise disclose or use for any purpose other than as permitted under, or required to perform its obligations under, this Agreement any financial information and materials furnished to it by the other Party (the “
Disclosing Party
”) pursuant to this Agreement (collectively, “
Confidential Information
”), except to the extent that it can be established by the Receiving Party that such Confidential Information:
|
●
|
was already known to the Receiving Party, other than under an obligation of confidentiality, at the time of disclosure by the Disclosing Party;
|
●
|
was generally available to the public or otherwise part of the public domain at the time of its disclosure to the Receiving Party;
|
●
|
became generally available to the public or otherwise part of the public domain after its disclosure to the Receiving Party and other than through any act or omission of the Receiving Party in breach of this Agreement;
|
●
|
was disclosed to the Receiving Party, other than under an obligation of confidentiality, by a Third Party who had no obligation to the Disclosing Party not to disclose such information to others; or
|
●
|
was subsequently developed by the Receiving Party without the aid, use or application of the Disclosing Party’s Confidential Information as demonstrated by competent written records.
|
5.2.
|
Authorized Disclosure
. Each Receiving Party may disclose the Disclosing Party’s Confidential Information hereunder to the extent such disclosure is reasonably necessary in prosecuting or defending litigation or complying with applicable governmental regulations,
provided
that if a Receiving Party is required by law or regulation to make any such disclosure of the Disclosing Party’s Confidential Information it will, where permitted by law, give reasonable advance written notice to the other Party of such disclosure requirement and will use its reasonable efforts to secure confidential treatment of such Confidential Information required to be disclosed. In addition, each Receiving Party shall be entitled to disclose, under obligations of confidentiality substantially as protective as this Article 9, the Disclosing Party’s Confidential Information to its Affiliates, consultants, clinical investigators, potential permitted sublicensees and other Third Parties only for any purpose provided for in this Agreement.
|
5.3.
|
Return of Confidential Information
. Upon the termination or expiration of this Agreement, any and all Confidential Information of a Disclosing Party possessed in tangible form by the Receiving Party, its Affiliates or any of their officers, directors, employees, agents or consultants shall, upon written request of the Disclosing Party, be immediately returned to the Disclosing Party (or destroyed if so requested) and not retained by the Receiving Party, its Affiliates or any of their officers, directors, employees, agents or consultants,
provided
that, each Receiving Party shall be entitled to retain any Confidential Information of the Disclosing Party that is reasonably required to exercise its rights under Clause 6 for so long as such rights survive. Notwithstanding the foregoing, each Receiving Party may retain one (1) copy of any Confidential Information of the Disclosing Party in appropriately secure legal files solely for record-keeping purposes.
|
|
9.4.
|
Public Disclosure; Use of Name
. Except as required by an order from a court or governmental body, applicable law or regulation neither Party shall use the name of the other Party in any publicity or advertising without the prior written approval of the other Party, except that either Party may disclose the existence, but not the terms or conditions (including information contained in any Exhibit hereto), of this Agreement. Notwithstanding the foregoing, in the event that either Party seeks to disclose the terms of this Agreement in any legally required filing, such Party shall provide prompt written notice to the other Party and use reasonable efforts to maintain the confidential treatment of the material terms of this Agreement to the extent reasonably possible, provided however that COMPANY may disclose the details of the Agreement in public filings to the Securities Exchange Commission (SEC) and the New York Stock Exchange (NYSE).
|
10.
|
ASSIGNMENT
|
10.1.
|
This Agreement may not be assigned, transferred or subcontracted by either Party without the prior written consent of the other Party, which consent shall not be unreasonably withheld; provided, however, that either Party may assign this Agreement, in whole or in part, without the other Party’s consent to an Affiliate, or in connection with a merger, consolidation, acquisition or a sale or transfer of all or substantially all of such Party’s assets to which this Agreement relates.
|
10.2.
|
Each Party shall as soon as practicable notify the other Party of an assignment to an Affiliate or of a Change of Control and shall provide the other Party with information reasonably requested by such Party with respect to such Affiliate or acquirer. “Change of Control” means: (a) the acquisition by any third party of beneficial ownership of fifty percent (50%) or more of the then-outstanding common shares or voting power of a Party; or (b) the consummation of a business combination involving a Party, unless, following such business combination, the stockholders of a Party immediately prior to such business combination beneficially own directly or indirectly more than fifty percent (50%) of the then-outstanding common shares or voting power of the entity resulting from such business combination. Any assignment not in accordance with the foregoing shall be void.
|
11.
|
PRESS RELEASES
|
11.1.
|
The Parties will not publicly disclose the nature or existence of this Agreement, through press releases, a web site, brochures, or written materials of any kind, unless differently agreed by both Parties in writing or unless required by the law or by the rules of any stock exchange which apply to a Party.
|
12.
|
NOTICES
|
12.1.
|
Any notices required or to be sent hereunder shall be in writing and delivered personally or sent by fax or mail or e-mail, at the sender’s choice. Notices delivered to the addresses, fax numbers or e-mail addresses indicated below (or such other address, fax number or e-mail address of which the receiving Party had notified the other Party in writing, in accordance with the procedures of this Section 12.1, at least 8 (eight) days prior to such delivery) shall be considered validly delivered and shall be considered received on the date of actual receipt; provided, however, that notices sent by fax shall be deemed given as of the date sent by fax properly addressed and transmitted.
|
13.
|
TERM AND TERMINATION
|
13.1
|
The term of this Agreement shall commence on the Effective Date and shall expire on the date on which both Parties have fulfilled all of their obligations contemplated herein. For the avoidance of doubt, the Agreement cannot be terminated by either of the Parties prior to its expiration unless specifically and expressly stipulated in the Agreement or unless agreed in writing by both Parties.
|
13.2
|
For the sake of clarity, the Parties agree and acknowledge that the expiration or termination of this Agreement shall not affect in any way the validity of the MSA or any of the relevant CTOs therein, which shall, to the extent applicable, continue in full force and effect unless terminated pursuant to the relevant clauses in the MSA or such CTO.
|
13.3
|
In case that either the MSA and / or any relevant CTO thereunder are terminated, this Agreement shall continue to apply to the Parties taking into account such fact of termination of MSA and / or the CTO and performance on any obligations of the Parties directly and solely related to the obligations under the MSA or the CTO shall no longer be required from either of the Parties. For the avoidance of doubt, in this case, the provisions stipulated in Sections 6, 9, 12 and 14 herein shall remain in full force and effect.
|
14
|
DISPUTE RESOLUTION AND GOVERNING LAW
|
14.1
|
General
.
The Parties recognize that disputes as to certain matters may from time to time arise which relate to either Party’s rights and/or obligations hereunder. It is the objective of the Parties to establish procedures to facilitate the resolution of disputes arising under this Agreement in an expedient manner by mutual dialogue and cooperation and, to extent possible, without resort to litigation. To accomplish this objective, the Parties agree to follow the procedures set forth in this Article 14 if and when a dispute arises under this Agreement.
|
14.2
|
Senior Management
. Any disputes relating to this Agreement shall be first referred to the Chief Executive Officer of CEL-SCI and the Chief Executive Officer of Ergomed, or their respective senior-level designees, for resolution through good faith negotiations. In the event that such executives, or their respective designees, cannot resolve the dispute within thirty (30) days of being requested by a Party to resolve a dispute, either Party may, by written notice to the other, invoke the provisions of Section 14.3 hereinafter.
|
14.3
|
Arbitration
. If efforts at mediation pursuant to Section 14.3 are unsuccessful within sixty (60) days after the date that one Party notifies the other Party that it desires to resolve a dispute, controversy or claim through mediation, any unresolved dispute, controversy or claim between the Parties shall be resolved by binding arbitration in accordance with the International Arbitration Rules of the American Arbitration Association, by 1 (one) arbitrator appointed pursuant to such Rules, except as modified herein. A reasoned arbitration decision shall be rendered in writing within six (6) months of the conclusion of mediation and shall be binding on the Parties. The prevailing Party may enter such decision in any court having competent jurisdiction. The mediation and arbitration proceedings shall be conducted in the English language and shall be held in
New York, New York. The Parties agree that they shall share equally the cost of the mediation and arbitration filing and hearing fees, and the cost of the mediator/arbitrator, except to the extent otherwise determined by the arbitrators. Each Party must bear its own attorneys’ fees and associated costs and expenses, except to the extent otherwise determined by the arbitrators.
|
14.4
|
Injunctive Relief, Collection of Amounts Due and Express Dispute Resolution Provisions
. Notwithstanding the foregoing provisions of this Article 14, (a) either Party will have the right to seek injunctive relief and/or collection of any undisputed amount due under this Agreement in any court of competent jurisdiction as may be available to such Party under the laws and rules applicable in such jurisdiction, and (b) the provisions of Sections 14.1-14.4 shall not apply with respect to any decision described in Section 4.3.
|
14.5
|
Governing Law
. This Agreement and all disputes thereof shall be governed by and construed in accordance with the substantive laws of the State of New York, USA other than any principle of conflict or choice of laws that would cause the application of the laws of any other jurisdiction.
|
15
|
FINAL PROVISIONS
|
15.1
|
If any provision of this Agreement should be deemed invalid or legally unenforceable, such provision shall not affect the validity and/or enforceability of any other provision(s) of this Agreement or the Agreement as a whole. The Parties shall, in such case, replace the invalid provision with a valid one that best expresses their original intent.
|
15.2
|
This Agreement (which includes its Schedules) and the MSA and the relevant CTO 2 to be entered into thereunder contain the entire and only agreement between the Parties with respect to the subject of the Agreement and wholly cancel, terminate and supersede any agreement or agreements, formal or informal, oral or written heretofore entered into pertaining to the subject matter, including the Confidentiality, Non-Disclosure and Non-Solicitation Agreement between the parties dated as of December 11, 2012. Notwithstanding the foregoing, the Parties agree and acknowledge that the Co-Development and Revenue Sharing Agreement dated April 19, 2013 for the Head & Neck Cancer Indication, the MSA and the CTO I thereunder, as each and every one of these may be amended from time to time shall survive the execution of this Agreement and continue in full force and effect in the full text stipulated by the Parties.
|
15.3
|
If a Party (the “Affected Party”) is unable to carry out any of its obligations under this Agreement due to Force Majeure this Agreement shall remain in effect but the Affected Party’s relevant obligations under this Agreement and the corresponding obligations of the other Party (“Non-Affected Party”) under this Agreement, shall be suspended for a period equal to the circumstance of Force Majeure provided that:
|
15.3.1
|
the suspension of performance is of no greater scope than is required by the Force Majeure;
|
15.3.2
|
the Affected Party immediately gives the Non-Affected Party prompt written notice describing the circumstance of Force Majeure, including the nature of the occurrence and its expected duration, and continues to furnish regular reports during the period of Force Majeure and notifies the Non-Affected Party immediately of the cessation of the Force Majeure;
|
15.3.3
|
the Affected Party uses all reasonable efforts to remedy its inability to perform and to mitigate the effects of the circumstance of Force Majeure; and
|
15.3.4
|
as soon as practicable after the event which constitutes Force Majeure the Parties discuss how best to continue their operations as far as possible in accordance with this Agreement.
|
15.4
|
The status of each Party under this Agreement shall be that of an independent contractor. Nothing contained in this Agreement shall be construed as creating a partnership, joint venture or agency relationship between the Parties or as granting either Party the authority to bind or contract any obligation in the name of or on the account of the other Party or to make any statements, representations, warranties or commitments on behalf of the other Party. All persons employed by a Party shall be employees of such Party and not of the other Party and all costs and obligations incurred by reason of any such employment shall be for the account and expense of such Party.
|
15.5
|
This Agreement is written and executed in the English language.
|
15.6
|
Any amendment or modification of this Agreement must be in writing and signed by authorized representatives of both Parties.
|
15.7
|
A Party’s failure to enforce, at any time or for any period of time, any provision of this Agreement, or to exercise any right or remedy shall not constitute a waiver of that provision, right or remedy or prevent such Party from enforcing any or all provisions of this Agreement and exercising any rights or remedies. To be effective any waiver must be in writing. All rights and remedies are cumulative and do not exclude any other right or remedy provided by law or otherwise available.
|
15.8
|
The provisions of this Agreement are for the sole benefit of the Parties and their successors and permitted assigns, and they shall not be construed as conferring any rights in any other Persons except as otherwise expressly provided. Except as expressly provided herein, no person who is not a party to this Agreement (including any employee, officer, agent, representative or subcontractor of either Party) shall have the right to enforce any term of this Agreement which expressly or by implication confers a benefit on that person without the express prior agreement in writing of the Parties, which agreement must refer to this Clause 15.8.
|
15.9
|
Each Party shall perform all further acts and things and execute and deliver such further documents as may be necessary or as the other Party may reasonably require to implement or give effect to this Agreement.
|
15.10
|
Except as otherwise expressly provided in this Agreement, each Party shall pay the fees and expenses of its respective lawyers and other experts and all other expenses and costs incurred by such Party incidental to the negotiation, preparation, execution and delivery of this Agreement.
|
15.11
|
This Agreement may be executed in any number of counterparts, each of which shall be deemed an original and all of which taken together shall be deemed to constitute one and the same instrument. An executed signature page of this Agreement delivered by facsimile transmission shall be as effective as an original executed signature page. Signatures to this Agreement transmitted by electronic mail in “portable document format” (“.pdf”) form, or by any other electronic means intended to preserve the originals graphic and pictorial appearance of a document, will have the same effect as physical delivery of the paper document bearing the original signatures, and shall be deemed original signatures by both Parties.
|
15.12
|
In construing this Agreement, unless expressly specified otherwise, (a) except where the context otherwise requires, use of any gender includes any other gender, and use of the singular includes the plural and vice versa; (b) any list or examples following the word “including” shall be interpreted without limitation to the generality of the preceding words; and (c) each Party represents that it has been represented by legal counsel in connection with this Agreement and acknowledges that it has participated in the drafting hereof. In interpreting and applying the terms and provisions of this Agreement, the Parties agree that no presumption will apply against the Party which drafted such terms and provisions.
|
CEL-SCI CORPORATION
|
ERGOMED CLINICAL RESEARCH LTD
|
|||
/s/Geert Kersten
|
/s/ Dr. Miroslav Reljanovic
|
|||
Print Name:
Geert Kersten
|
Print Name:
Dr. Miroslav Reljanovic
|
|||
Title:
Chief Executive Officer
|
Title:
Chief Financial Officer
|
1.
|
Definitions
. Unless otherwise defined or amended by the terms of this First Amendment, all initial capitalized defined terms used have the meanings as defined in the Co-Development Agreement II.
|
2.
|
A Definition of “Indications” shall be amended to read: ““Indications” – shall mean all of the indications together: Head and Neck Cancer, Anal Intraepithelial Neoplasia and Cervical Intraepithelial Neoplasia, for which the Product will be developed under any of the co-development agreements between the Parties for such Product; “other Indication(s)” shall mean any remaining Indication(s) not specifically referred to in any respective sentence in the Agreement.”
|
3.
|
Section 3.1. shall be amended to read: “Subject to the conclusion of CTO 2 and with respect to the Product Development in CIN Indication, Ergomed shall invest up to $3 million towards the clinical and regulatory costs determined in the Co-Development Program 2 for the execution of the Co-Developed Clinical Trial(s) for the Product in CIN Indication (the actual amount of such investment, determined in accordance with Section 6) (“Ergomed Co-Development Investment CIN”). The total of Ergomed investment into the Development of the Product in all Indications shall be referred to hereinafter as “Ergomed Total Co-Development Investment”). The Ergomed Co-Development Investment CIN shall not exceed US$3,000,000 (three million dollars) for Product Development in CIN Indication (the “Ergomed Co-Development Investment Cap CIN”) and shall not exceed US$16,000,000
|
4.
|
A Section 6.3. shall be amended to read: “It is noted that Ergomed and CEL-SCI are jointly developing the Product for several Indications governed in three separate co-development agreements. The Ergomed Total Co-Development Investment shall be accrued collectively through the efforts in all Indications and the Revenues described in section 6.2 calculated on the basis of the Ergomed Total Co-Development Investment. As an illustration and for clarity, in the event that Ergomed invests $10 million in Head and Neck Cancer, $3 million in AIN and $3 million in CIN, the Total Ergomed Co-Development Investment will be $16 million and the total Ergomed revenue will be $64 million, received from all Net Income from all Product sales.”
|
5.
|
Except as amended by this First Amendment, the Co-Development Agreement II shall remain in full force and effect. After the date of this First Amendment, every reference to the Co-Development Agreement II shall mean such agreement as amended by this First Amendment.
|
6.
|
Definitions
. Unless otherwise defined or amended by the terms of this Second Amendment, all initial capitalized defined terms used have the meanings as defined in the Co-Development Agreement.
|
7.
|
A Definition of “Indications” shall be amended to read: ““Indications” – shall mean all of the indications together: Head and Neck Cancer, Anal Intraepithelial Neoplasia and Cervical Intraepithelial Neoplasia, for which the Product will be developed under any of the co-development agreements between the Parties for such Product; “other Indication(s)” shall mean any remaining Indication(s) not specifically referred to in any respective sentence in the Agreement.”
|
8.
|
Section 3.1. shall be amended to read: “With respect to the Product Development in Head and Neck Indication, Ergomed shall invest up to $10 million towards the clinical and regulatory costs determined in the Co-Development Program for the execution of the Co-Developed Clinical Trial for the Product in Head and Neck Indication in Europe, Russia and India (the actual amount of such investment, determined in accordance with Section 6) (“Ergomed Co-Development Investment H&N”). The total of Ergomed investment into the Development of the Product in all Indications shall be referred to hereinafter as “Ergomed Total Co-Development Investment”. The Ergomed Co-Development Investment H&N shall not exceed US$10,000,000 (ten million dollars) for Product Development in H&N Indication
|
9.
|
A Section 6.3. shall be amended to read: “It is noted that Ergomed and CEL-SCI are jointly developing the Product for several Indications governed in three separate co-development agreements. The Ergomed Total Co-Development Investment shall be accrued collectively through the efforts in all Indications and the Revenues described in section 6.2 calculated on the basis of the Ergomed Total Co-Development Investment. As an illustration and for clarity, in the event that Ergomed invests $10 million in Head and Neck Cancer, $3 million in AIN and $3 million in CIN, the Total Ergomed Co-Development Investment will be $16 million and the total Ergomed revenue will be $64 million, received from all Net Income from all Product sales.”
|
10.
|
Except as amended by this Second Amendment, the Co-Development Agreement shall remain in full force and effect. After the date of this Second Amendment, every reference to the Co-Development Agreement shall mean such agreement as amended by this Second Amendment.
|
1.0
|
Definitions
|
a.
|
Affiliates
: With respect to either Party, an Affiliate is a
ny entity that is controlled by, controls, or is under common control with the Party named above.
|
b.
|
Amendment
: A written specification of changes to a Project Agreement that is agreed to by the Parties and authorized by signature of each Party’s authorized representative(s), in a format substantially similar to Exhibit B attached hereto.
|
c.
|
Budget for Services
: A component of a Project Agreement that delineates the estimated cost of the Services based upon the Project Specifications.
|
d.
|
Institutional Review Board (“IRB”)
: Any board, committee, or other group formally designated by an institution to review, to approve the initiation of, and to conduct periodic review of, biomedical research involving human subjects. The primary purpose of such review is to assure the protection of the rights and welfare of human subjects. The term has the same meaning as the phrase institutional review committee, independent ethics committee or ethics committee.
|
e.
|
GCP or Good Clinical Practice
: The standard defined in the ICH Harmonised Tripartite Guideline For Good Clinical Practice E6(R1) Current Step 4 version dated 10 June 1996 (including the Post Step 4 corrections) together with, for Services performed in the European Union, such other Good Clinical Practice requirements as are specified in Directive 2001/20/EC of the European Parliament and the Council of 4 April 2001 relating to medicinal products for human use and in guidance published by the European Commission pursuant to such Directive; and for Services performed in other jurisdictions, any analogous laws and/or regulations.
|
f.
|
Institution
: Any public or private entity or agency or medical or dental facility where clinical trials are conducted.
|
g.
|
Investigator(s)
: A person or persons responsible for the conduct of the clinical trial at a Trial Site. If a trial is conducted by a team of individuals at a Trial Site, the Investigator is the responsible leader of the team and may be called the principal investigator.
|
h.
|
Milestone
: An event associated with a specific date, for which a payment will be due, as set out in the Payment Schedule of any Project Agreement.
|
i.
|
Pass-Through Budget
: A component of a Project Agreement that outlines the estimated costs of Pass Through Expenses for goods and services incurred by Aptiv Solutions on behalf of Client, in connection with the performance of the Services.
|
j.
|
Payment Schedule
: A component of a Project Agreement that describes the timing of payments due to be made for Services delivered and Pass Through Expenses incurred.
|
k.
|
Aptiv Solutions Project Manager
: The Aptiv Solutions representative assigned to lead the Aptiv Solutions project team, act as the principal liaison between Aptiv Solutions and Client, and provide general oversight in the delivery of Services with regard to a specific Project Agreement.
|
l.
|
Project Agreement
: A written specification of Services to be performed by Aptiv Solutions under this Agreement, including the Project Specifications, Project Schedule, Contact Information, Budget for Services, Pass-Through Budget, and Payment Schedule
|
m.
|
Project Schedule
: A component of a Project Agreement that outlines the project milestones, estimated timelines and completion date for the Services based upon the Project Specifications.
|
n.
|
Project Specifications
: A component of a Project Agreement that outlines the specific Services to be provided, assumptions used in preparing the Budget for Services, Pass-Through Budget and Project Schedule, and assignment of project-related responsibilities between the Parties.
|
o.
|
Services
: The services to be provided by Aptiv Solutions and its Subcontractors (if applicable) under this Agreement as specifically outlined in a Project Agreement or otherwise authorized by Client.
|
p.
|
Study
: A clinical trial performed at one or more investigative sites under the supervision of one or more Investigator(s) pursuant to a study protocol.
|
q.
|
Subcontractor
: An individual or company engaged by Aptiv Solutions to conduct some elements of a Project Agreement, including without limitation, clinical laboratories, patient recruitment services, interactive voice recognition systems and other services.
|
r.
|
Trial Site(s)
: The location(s) where trial-related activities are actually conducted.
|
2.0
|
SERVICES
|
2.1
|
Project Agreements
|
2.2
|
Amendments
|
a.
|
Unanticipated Changes
. Client agrees that some changes in costs associated with clinical research resulting from, for example, changes to Project Specifications resulting from modifications to the study protocol, delays in receipt of study drugs from Client, changes in amounts charged by third party suppliers or poor subject enrollment due to changes in clinical practices, cannot be reasonably anticipated in advance. Upon identification by either Party of changes to the project assumptions or other unanticipated changes to the Project Specifications, the Parties will negotiate in good faith an Amendment to accommodate increases or decreases to the Project Budget, Project Schedule or Payment Schedule that are reasonably associated with any such adjustments. Amendments will be documented in accordance with the terms of this Section 2.2. Such unanticipated changes may include, but are not limited to, any of the following:
|
i.
|
delays in receiving from Client technical information or Client's acceptance of documents submitted by Aptiv Solutions in the performance of its duties under this Agreement or any Project Agreement, or any other delay on the part of Client;
|
ii.
|
delay in receipt of regulatory approval from a regulatory agency, IRB or Ethics Committee;
|
iii.
|
delay in performance by a Subcontractor not selected by Aptiv Solutions;
|
iv.
|
delay in shipment of study drug, clinical samples and/or clinical supplies;
|
v.
|
delay due to changes in standard of care imposed by law, regulation or changes in medical practice affecting participating sites;
|
vi.
|
delay by reason of force majeure as defined herein;
|
vii.
|
Client requested additional services or changes to the Services or protocol;
|
viii.
|
delays due to questions received by either Party from regulatory agencies or ethics committees regarding submission materials that relate to characteristics of the study drug or protocol design;
|
ix.
|
delays due to any changes in applicable law or regulatory environment; or
|
x.
|
changes for any other reason agreed upon in writing by Client.
|
2.3
|
Project Staffing
|
a.
|
Use of Contract Employees
. Aptiv Solutions may, at its own discretion, assign some elements of the Services to contract employees. Aptiv Solutions agrees that any contract employees used to perform the Services will be adequately qualified, experienced and trained as required to perform the Services in the same manner as Aptiv Solutions qualifies and trains its own employees. Aptiv Solutions will remain responsible for satisfactory performance of all Services performed by contract employees.
|
2.4
|
Use of Subcontractors
|
a.
|
Client-Selected Subcontractors.
In the event that Client requires Aptiv Solutions to use a specific Subcontractor (hereinafter “Client Subcontractor”), Aptiv Solutions will not be responsible for the performance of the Client Subcontractor, and Client will manage the performance of the Client Subcontractor and be responsible for any delays or changes to the Project Schedule or Project Budget that result from the performance of the Subcontractor. Aptiv Solutions will notify Client promptly of any performance issues arising out of the use of any such Client Subcontractors. If Client engages a Client Subcontractor, but requires that Aptiv Solutions manage or oversee the performance of the Client Subcontractor, then Client will supply Aptiv Solutions with information relevant to performance of the Client Subcontractor so that Aptiv Solutions will be able to manage the performance. If Client requires that Aptiv Solutions contract with the Client Subcontractor, then Client hereby authorizes Aptiv Solutions to do so as agent on behalf of Client. Client remains responsible for any delays or changes to the Project Schedule or Project Budget that result from the performance of the Client engaged Client Subcontractor.
|
b.
|
Aptiv Solutions-Selected Subcontractors
. For Subcontractors selected and contracted directly by Aptiv Solutions, Aptiv Solutions will be responsible for the performance and agrees to manage the performance of the Subcontractor.
Client shall be named as a third party beneficiary in any contract with an Aptiv Solutions-Selected Subcontractor
.
|
2.5
|
Trial Site Contracts
|
2.6
|
Applicable Standards
|
2.7
|
Client-Provided Systems
|
3.0
|
PAYMENT
|
3.1
|
Compensation for Services
|
3.2
|
Pass-Through Budget
|
a.
|
Pass-Through Expenses.
Pass Through Expenses, include, but are not limited to investigator fees, central labs, packaging and distribution of medication, printing and distribution of Case Report Forms, Institutional Review Board submission fees, incurred by Aptiv Solutions in the conduct and performance of the Services will be passed on to Client for payment
|
b.
|
In order to provide funding for Pass Through Expenses, exclusive of investigator fees described below, Client will make an advance payment to Aptiv Solutions of an amount described in the Project Agreement, at such time as shall be delineated in the Project Agreement. Aptiv Solutions will submit to Client monthly invoices for amounts incurred during the relevant billing period. The advance payment will be credited against invoices, to reflect payments made to vendors, suppliers or for other pass through costs during the invoicing period. At the completion of the Services a reconciliation of expenses will be done to ensure that Client pays for only those expenses actually incurred. The remaining advance payment, if any, will then be applied to the final invoice, if unpaid, and any remaining advance payment will be refunded to Client within thirty (30) days from the date of the final reconciliation
.
|
c.
|
Client will reimburse all travel expenses in accordance with Aptiv Solutions’ applicable Travel and Expense Policy (to be provided upon request), as shown on monthly invoices. Each invoice will include, as necessary, a summary of all Pass through Expenses.
|
|
In order to provide for timely payments to Investigators, Client will make an advance payment to Aptiv Solutions of such amounts as are delineated in the Project Agreement. Aptiv Solutions will submit to Client monthly invoices in advance for estimated amounts to be paid to Investigators to be incurred in the upcoming quarter to ensure that adequate funds are available to pay such expenses. Client agrees that Aptiv Solutions will not make payments to Investigators without sufficient funds available. The advance payment will be retained by Aptiv Solutions until the completion of the Services, at which time a reconciliation of expenses will be done to ensure that Client pays for only those expenses actually incurred. The advance payment, if any, will then be applied to the final invoice, if unpaid, and any remaining advance payment will be refunded to Client within thirty (30) days from the date of the final reconciliation
.
|
3.4
|
Invoices
|
a.
|
Invoices for Services and Pass Through Expenses will be submitted in accordance with the Payment Schedule associated with the relevant Project Agreement and will be prepared monthly, or as frequently as necessary. Any final payments specified in the Project Agreement will be invoiced upon completion of the project and delivery to Client of any final study databases, reports or other deliverables as specified in the Project Specifications.
|
b.
|
All invoices under this Agreement will be forwarded to the Client representative designated in the relevant Project Agreement.
|
c.
|
All payments under this Agreement will be remitted to the Aptiv Solutions Affiliate named in the Project Agreement, to the address and in the manner set forth in the Payment Schedule of the applicable Project Agreement.
|
3.5
|
Payment Terms
|
4.0
|
TERM AND TERMINATION
|
4.1
|
Term
|
4.2
|
Termination without Cause
|
a.
|
Client and Aptiv Solutions will meet within thirty (30) days of Aptiv Solutions’ receipt of such termination notice to develop a plan and budget for (a) closing down administration of this Agreement or (b) closing down the Study which is the subject of the terminated Project Agreement, which will include transferring any remaining tasks or other responsibilities to Client or its designee.
|
b.
|
Client will pay to Aptiv Solutions the actual costs incurred in providing the Services and the Pass Through Expenses incurred in the performance of the terminated Project Agreement, as well as the actual costs and the pass-through expenses incurred in the course of winding down or closing out the terminated Project Agreement
as negotiated by the parties under 4.2 (b).
|
4.3
|
Termination by Client for Cause
|
4.4
|
Termination by Aptiv Solutions for Cause
|
4.5
|
Termination for Other Reasons
|
4.6
|
Survival
|
5.0
|
REPRESENTATIONS AND WARRANTIES
|
5.1
|
Acknowledgments
|
5.3
|
Representations and Warranties of Client
|
a.
|
Client represents and warrants that it has the right, title and interest in the drug, compound, device or other material which is the subject of research covered by this Agreement or any Project Agreement (whether such right, title and interest is held solely by Client or jointly with others) and that it has the legal right, authority and power to enter into this Agreement, and to perform any clinical trial which is the subject of a Project Agreement issued hereunder.
|
b.
|
Client further represents and warrants that the services required of Aptiv Solutions hereunder will not violate the rights of any third party including but not limited to intellectual property rights.
|
c.
|
If Client requires Aptiv Solutions to use MedDRA to code, analyze or report data for a Study, Client represents and warrants that it has a current and valid license agreement with the Maintenance and Support Services Organization (“MSSO”) to use MedDRA. Furthermore, if Aptiv Solutions is required to use WHO Drug, WHO Herbal or WHO ART for coding of data, Client warrants and represents that it has a current and valid license agreement with The Uppsala Monitoring Centre for the dictionaries which Aptiv Solutions will be required to use. If Client does not currently have such licenses, it represents and warrants that such licenses will be in place prior to the delivery of data by Aptiv Solutions which is coded using these dictionaries. Aptiv Solutions will not be liable to Client for use of data coded without proper licensing, and Client will hold Aptiv Solutions harmless in these occasions. In the event Client requests that Aptiv Solutions perform services which require Aptiv Solutions to distribute MedDRA terminology or WHODrug dictionary to third parties, CLIENT shall be responsible for ensuring that all such third parties possess the necessary MedDRA and/or Uppsala Monitoring Centre product licenses.
|
5.4
|
Representations and Warranties of Aptiv Solutions
|
a.
|
Aptiv Solutions represents and warrants that the personnel assigned to perform Services rendered under this Agreement will be capable professionally.
|
b.
|
Aptiv Solutions further represents and warrants that it will make available to Client or to the responsible regulatory authority relevant records, programs, and data as may be reasonably requested by Client for purposes related to filing and prosecution of Client's related new drug applications; provided such request is consistent with all applicable laws that protect confidentiality of personal data.
|
c.
|
Aptiv Solutions’ sole obligation for material breach of a representation and warranty set out in this Section will be to correct or replace that portion of the Services that fails to materially conform thereto. Alternatively, Client will be entitled to a return of all funds associated with any Services performed in breach of this Agreement, and the related Project Agreement and any other remedies available to the Client at law or under this Agreement.
|
6.0
|
DEBARMENT CERTIFICATION
|
a.
|
Aptiv Solutions certifies that it has not been debarred under Section 306 of the Federal Food, Drug, and Cosmetic Act, 21 U.S.C.
§
335a(a) or (b) or any equivalent local law or regulation. In the event that Aptiv Solutions becomes debarred
or is subject to a proceeding that could lead to debarment or a criminal prosecution, Aptiv Solutions agrees to notify Client immediately.
|
b.
|
Aptiv Solutions certifies that it has not and will not use in any capacity the services of any individual, corporation, partnership, or association including clinical sites which has been debarred under Section 306 of the Federal Food, Drug and Cosmetic Act, 21 U.S.C
§
335a (a) or (b) or any equivalent local law or regulation. In the event that Aptiv Solutions becomes aware of or receives notice of the debarment of any individual, corporation, partnership, or association providing services to Aptiv Solutions, which relate to the Services being provided under this Agreement, Aptiv Solutions agrees to notify Client immediately.
|
7.0
|
AUDIT AND INSPECTIONS
|
7.1
|
Audit by Client
|
a.
|
Routine Audits
. During the term of this Agreement, Aptiv Solutions will permit representatives of Client who are not competitors of Aptiv Solutions to examine, at a reasonable time during normal business hours and subject to at least ten (10) business days prior written notice to Aptiv Solutions: (i) the facilities where the Services are being, will be or have been conducted; (ii) related study documentation. The purpose of such audit will be to enable the Client to confirm that the Services are being or will be or have been conducted in conformance with applicable standard operating procedures, a specific Project Agreement, this Agreement and in compliance with applicable laws and regulations. Client shall pay the reasonable costs of any such audits. Routine audits will be limited to one per calendar year. Aptiv Solutions will provide copies of any materials reasonably requested by Client during such audit. Aptiv Solutions will implement all modifications that prove necessary subsequent to the findings of the audit made by or on behalf of Client.
|
b.
|
“For cause” audits
. During the term of this Agreement, Client shall have the right to conduct “for cause” audits in the event of a reasonable suspicion that Aptiv Solutions is not performing the Services correctly or in conformity with applicable standard operating procedures, a specific Project Agreement, this Agreement or applicable laws and regulations. Aptiv Solutions will cooperate fully in such audit, and will provide copies of any materials reasonably requested by Client during such audit.
|
7.2
|
Inspection by Regulatory Authorities
|
8.0
|
DISPOSITION OF COMPUTER FILES AND STUDY MATERIALS
|
9.0
|
OWNERSHIP OF DATA AND INTELLECTUAL PROPERTY
|
10.1
|
Client Confidential Information
|
a.
|
Client may disclose confidential information to Aptiv Solutions during the course of this Agreement. All information provided by or on behalf of Client or data collected by Aptiv Solutions during the performance of the Services is deemed to be the confidential information of Client and is hereinafter referred to as “Client Information”. Aptiv Solutions will not disclose Client Information to any person other than its Affiliates and its and their respective employees, agents, Investigators, Trial Sites and independent contractors involved in the Services or use any such information for any purpose other than the performance of Services without the prior written consent of Client, except that Aptiv Solutions may share Client Information with Client’s Affiliates, if requested.
|
b.
|
Aptiv Solutions will ensure that it and its Affiliates’ employees, agents, and independent contractors involved in the Services will comply with terms substantively similar to the confidentiality provisions of this Agreement. Contracts with Trial Sites will include provisions no less restrictive than these terms. Aptiv Solutions will disclose the Client Information only to those of Aptiv Solutions’ of Client’s Affiliates, and their employees, agents, Investigators, Trial Sites and independent contractors who reasonably need to know the Client Information for the purposes of carrying out a Project Agreement.
|
c.
|
Aptiv Solutions will exercise due care to prevent the unauthorized disclosure and use of Client Information associated with the Services.
|
d.
|
This confidentiality, nondisclosure and nonuse provision will not apply to Client Information that Aptiv Solutions can demonstrate by competent evidence:
|
i.
|
was known by Aptiv Solutions before initiation of the Services or which is independently discovered, after the initiation of the Services, without the aid, application or use of Client Information, as evidenced by written records;
|
ii.
|
was in the public domain at the initiation of the Services or subsequently became publicly available through no fault or action of Aptiv Solutions; or
|
iii.
|
was disclosed to Aptiv Solutions on a non-confidential basis by a third party authorized to disclose it.
|
e.
|
In no event will either Party be prohibited from disclosing confidential information of the other Party to the extent required by law to be disclosed, provided that the disclosing Party provides the non-disclosing Party with written notice thereof, prior to disclosure, to the extent reasonably practicable, discloses only what is required to be disclosed by law or regulation, and, at the non-disclosing Party’s request and expense, cooperates with the non-disclosing Party’s efforts to obtain a protective order or other confidential treatment of the confidential information required to be disclosed.
|
10.2
|
Aptiv Solutions Confidential Information
|
10.3
|
Return or Destruction of Information
|
10.4
|
Data Protection
|
11.0
|
PUBLICATION AND PUBLICITY
|
12.0
|
INDEMNIFICATION
|
12.1
|
Client’s Agreement
|
a.
|
Client will indemnify, defend and hold harmless Aptiv Solutions, its Affiliates, and their officers, directors, agents, employees, and independent contractors approved by Client (each an “Indemnitee”) against any claim, suit, action, proceeding, arbitration or investigation, pending or threatened by a third party (each a “Claim”) against Indemnitees based on, relating to or in connection with the Services and other work conducted under this Agreement, including but not limited to court costs, legal fees, awards or settlements. Aptiv Solutions will promptly notify Client upon receipt of notice of any Claim (provided that the failure to give such notice will not relieve Client of its obligations under this Section except to the extent, if at all, it is prejudiced thereby) and will permit Client's attorneys and personnel, at Client's discretion and cost, to handle and control the defense of any such Claim. In the event that representation of Aptiv Solutions and Client by the same counsel is a conflict of interest for such counsel, Aptiv Solutions may select its own independent counsel, at Client’s expense, without relieving Client of its obligations under this Section.
|
b.
|
Under no circumstances, however, will Client accept liability, settle or otherwise compromise any Claims without prior written consent of Aptiv Solutions. Aptiv Solutions will fully cooperate and aid in any such defense.
|
c.
|
Client will not indemnify, defend, or hold harmless Aptiv Solutions against any Claim to the extent that such Claim arose as a result of Aptiv Solutions’ negligence, recklessness, intentional misconduct or material breach of this Agreement or any Project Agreement hereunder. Under such circumstances Aptiv Solutions will repay to Client all reasonable defense costs incurred by Client on its behalf.
|
12.2
|
Aptiv Solutions’ Agreement
|
a.
|
Aptiv Solutions will indemnify, defend and hold harmless Client and its employees, officers, and directors against any and all Claims including but not limited to reasonable to court costs, legal fees, awards or settlements based on a personal injury resulting from Aptiv Solutions’ negligence, intentional misconduct, or material breach of this Agreement or any Project Agreement hereunder. Client will promptly notify Aptiv Solutions upon receipt of notice of any Claim for which it intends to seek indemnification hereunder, provided that the failure to give such notice will not relieve Aptiv Solutions of its obligations under this Section except to the extent, if at all, it is prejudiced thereby. Client will permit Aptiv Solutions’ attorneys and personnel, at Aptiv Solutions’ discretion and cost, to handle and control the defense of any such Claim. In the event that representation of Client and Aptiv Solutions by the same counsel is a conflict of interest for such counsel, Client may select its own independent counsel, at Aptiv Solutions’ expense, without relieving Aptiv Solutions of its obligations under this Section.
|
b.
|
Under no circumstances, however, will Aptiv Solutions accept liability, settle or otherwise compromise any claims subject to indemnification under this Section without prior written consent of Client,
which shall not unreasonably be withheld. Client will fully cooperate and aid in any such defense.
|
c.
|
Aptiv Solutions does not agree, and will have no obligation to indemnify, defend or hold harmless Client against any claim to the extent that such claim arose as a result of Client’s negligence, recklessness, intentional misconduct or material breach of this Agreement or any Project Agreement hereunder. Under such circumstances Client will repay to Aptiv Solutions all reasonable defense costs incurred by Aptiv Solutions on its behalf.
|
12.3
|
Limits of Liability
|
12.4
|
Insurance
|
a.
|
Client Insurance. During the term of this Agreement, and for a period of five (5) years following the termination of this Agreement or completion of each Project Agreement, Client shall maintain in full force and effect a policy or policies or self-insurance
of:
|
i.
|
general liability insurance (with product liability endorsements) with limits of not less than Five Million Dollars ($5,000,000);
|
ii.
|
products liability with limits of not less than Five Million Dollars ($5,000,000); and
|
iii.
|
clinical trials insurance in compliance with local compulsory requirements. Client will extend this coverage to protect Aptiv Solutions from and against any action or actions for property damage, personal injury or death arising from activities properly undertaken, or undertaken at the express instructions of Client, within the terms of the Agreement.
|
b.
|
Aptiv Solutions Insurance. Aptiv Solutions shall at all times during the term of this Agreement and any extended terms thereof, provide and maintain at its own expense, the following types of insurance:
|
i.
|
Professional Liability: Professional Liability covering all professional acts, errors and omissions in an amount of not less than Five Million Dollars ($5,000,000) per occurrence and in the aggregate.
|
ii.
|
General Liability: Commercial General Liability insurance against claims for bodily injury and property damage in an amount of not less than Five Million Dollars ($5,000,000) per occurrence and in the aggregate.
|
iii.
|
Workers Compensation and Employers’ Liability: To comply with the statutory requirements of the state(s) in which the Services are performed. The policy shall include Employers’ Liability for not less than One Million Dollars ($1,000,000) per accident.
|
c.
|
General Terms
|
i.
|
All policies shall be issued by one or more insurance companies rated A- VII or better by the BEST Rating guide or its equivalent.
|
ii.
|
Such insurance may be provided on a claims-made basis (with the exception of workers compensation and employers’ liability), however, such insurance shall have a retroactive date prior to the date that any work will be performed pursuant to the Agreement, and shall be maintained (or shall have an extended reporting period) of at least five (5) years after the termination of this Agreement.
|
iii.
|
In the event that such policies are cancelled, terminated or altered, the insured Party shall endeavor to provide at least thirty (30) days prior written notice to the other Party.
|
iv.
|
It is agreed and understood that the above limits are minimum required amounts and are not limitations of liability.
|
13.0
|
INDEPENDENT CONTRACTOR RELATIONSHIP
|
14.0
|
EMPLOYEES
|
15.0
|
NOTICES
|
If to Aptiv Solutions :
Aptiv Solutions, Inc.
1925 Isaac Newton Square
Suite 100
Reston, VA 20190, USA
Attention: Chief Executive Officer
Copy to: VP, Legal Affairs
|
If to Client:
CEL-SCI Corporation
8229 Boone Boulevard,
Suite 802,
Vienna, VA 22182, USA
Attention: Chief Executive Officer
|
16.0
|
FORCE MAJEURE
|
17.0
|
GOVERNING LAW
|
18.0
|
SEVERABILITY
|
19.0
|
ASSIGNMENT
|
20.0
|
WAIVER
|
21.0
|
ENTIRE AGREEMENT
|
22.0
|
ENGLISH LANGUAGE
|
23.0
|
COUNTERPARTS
|
24.0
|
ARBITRATION
|
Aptiv Solutions, Inc. | CEL-SCI Corporation | |||
/s/Luis T. Gutierrez, Jr.
|
/s/ Geert Kersten
|
|||
Authorized Signature
|
Authorized Signature
|
|||
|
|
|||
Executive Vice President & Chief Commercial Officer | CEO | |||
Title | Title | |||
19 March 2013 | March 22, 2013 | |||
Date | Date |
a.
|
The Budget for Services, attached to the Agreement as Appendix _, is hereby stricken and replaced by the “Amended Budget”, attached hereto as Amendment Appendix _, which is incorporated herein by reference.
|
b.
|
The Payment Schedule, attached to the Agreement as Appendix __, is hereby stricken and replaced by the “Amended Payment Schedule”, attached hereto as Amendment Appendix __, which is incorporated herein by reference.
|
1.
|
Budget for Services and Pass-Through Budget.
Therefore, the following changes to the Agreement are hereby made:
|
a.
|
Budget for Services and Pass-Through Budget
, attached to the Agreement as Appendix C, is hereby updated
with additional Pass Through Costs
as detailed in Amendment Appendix A attached hereto and incorporated herein by reference.
|
APTIV SOLUTIONS, INC. | CEL-SCI CORPORATION | |||
/s/Michael McKelvey
|
/s/ Geert R. Kersten
|
|||
Authorized Signature
|
Authorized Signature
|
|||
|
|
|||
Executive Vice President and
Chief Operations Officer
|
Chief Executive Officer | |||
Title | Title | |||
July 31, 2013 | July 31, 2013 | |||
Date | Date |
ADDITIONAL ESTIMATED PASS-THROUGH COSTS
|
USD
|
|||
MD Anderson
|
924,832 | |||
ICON - Medical Imaging
|
1,757,838 | |||
Total (This Amendment 01)
|
2,682,670 |
SUMMARY OF ESTIMATED PASS-THROUGH COSTS
|
USD
|
|||
Original Agreement (PA01)
|
1,638,650 | |||
This Amendment 01
|
2,682,670 | |||
Total
|
4,321,320 |
Summary of TOTAL including Aptiv Solutions costs + pass-through costs
|
USD
|
|||
Original Agreement (PA01)
|
15,594,282 | |||
This Amendment 01
|
2,682,670 | |||
Total
|
18,276,952 |
a.
|
Budget for Services and Pass-Through Budget, attached to the Agreement as Appendix C, is hereby updated with additional Pass Through Costs as detailed in Amendment Appendix A attached hereto and incorporated herein by reference.
|
b.
|
All Change Order Items will be invoiced on a monthly basis as work is completed. All costs are estimates (other than Fixed Costs); Client will be invoiced only for actual work completed.
|
APTIV SOLUTIONS, INC. | CEL-SCI CORPORATION | |||
/s/Michael McKelvey
|
/s/ Geert R. Kersten
|
|||
Authorized Signature
|
Authorized Signature
|
|||
|
|
|||
Executive Vice President and
Chief Operations Officer
|
Chief Executive Officer | |||
Title | Title | |||
February 11, 2014 | February 11, 2014 | |||
Date | Date |
●
|
ICON's involvement will continue until 07 September 2018. Therefore, the following unit counts shall increase:
|
o
|
Study Coordination
|
o
|
Project Teleconferences - Project Manager
|
o
|
Database Administration & Reporting
|
o
|
IT & Archival Storage Space
|
o
|
Data Reconciliation
|
•
|
General Site Support
|
•
|
Partial Expansion to Patient Randomization
|
•
|
Estimated Pass Through Shipping Costs
|
•
|
Preparation, QC and Delivery of Materials to Sites
|
•
|
Site Imaging Manual Training Call
|
•
|
Site Technical Evaluations Forms (Phone/Fax)
|
●
|
A US Investigator Meeting and Preparation shall be added along with related pass through associated with travel
|
●
|
The following 3 documents shall be updated:
|
o
|
Standard Read: Charter Update
|
o
|
Data Delivery Specifications
|
o
|
System Requirement Specifications
|
● | July 6, 2015; or | |
● | upon 10 days written notice to Borrower. |
Shares Issuable Upon Exercise of Warrant | Per Share Exercise Price | Expiration Date |
1,648,244
|
$0.40
|
12-24-14
|
1,849,298
|
$0.50
|
1-6-15
|
April 17, 2015
|
/s/ Geert R. Kersten | ||
Geert R. Kersten | |||
Principal Executive Officer | |||
April 17, 2015
|
/s/ Geert R. Kersten | ||
Geert R. Kersten | |||
Principal Financial Officer | |||
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects the financial condition and results of the Company.
|
April 17, 2015
|
/s/ Geert Kersten | ||
Geert Kersten, Chief Executive and Principal | |||
Financial and Accounting Officer | |||