|
Delaware
|
| |
2834
|
| |
20-1295171
|
|
|
(State or other jurisdiction
of incorporation or organization) |
| |
(Primary Standard Industrial
Classification Code Number) |
| |
(I.R.S. Employer
Identification Number)
|
|
|
Yvan-Claude Pierre, Esq.
Michael Sanders, Esq. Daniel I. Goldberg, Esq. Reed Smith LLP 599 Lexington Avenue New York, New York 10022 (212) 521-5400 (212) 521-5450 — Facsimile |
| |
Anthony J. Marsico, Esq.
Greenberg Traurig, LLP MetLife Building 200 Park Avenue New York, NY 10166 (212) 801-9200 (212) 801-6400 — Facsimile |
|
|
Large accelerated filer
|
| | ☐ | | | Accelerated filer | | | ☐ | |
| Non-accelerated filer | | | ☐ (Do not check if a smaller reporting company) | | |
Smaller reporting company
|
| | ☒ | |
Title of each class of securities to be registered
|
| |
Proposed Maximum
Aggregate Offering Price (1) |
| |
Amount of
Registration Fee |
| ||||||
Common stock, par value $0.001 per share
(2)
|
| | | $ | 25,116,000 | | | | | $ | 2,918.48 | | |
Representative’s Warrants to Purchase Common Stock
(3)
|
| | | | — | | | | | | — | | |
Common Stock Underlying Representative’s Warrants
(2)(4)
|
| | | $ | 1,092,000 | | | | | $ | 126.89 | | |
Total Registration Fee
|
| | | $ | 26,208,000 | | | | | $ | 3,045.37 (5) | | |
| | | | | | | |
| PRELIMINARY PROSPECTUS | | |
SUBJECT TO COMPLETION
|
| |
DATED APRIL 24, 2015
|
|
| | | | | | | | |
| | |
Per Share
|
| |
Total
|
| ||||||
Public offering price
|
| | | $ | | | | | $ | | | ||
Underwriting discounts and commissions
(1)
|
| | | $ | | | | | $ | | | ||
Offering proceeds to us, before expenses
|
| | | $ | | | | | $ | | | |
| Aegis Capital Corp | | |
Chardan Capital Markets, LLC
|
|
| | |
Page
|
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| | | | 137 | |
| | | | 137 | |
| | | | F-1 |
| | |
For the Years Ended December 31,
|
| |||||||||||
| | |
2014
|
| |
2013
|
| ||||||||
| | | | | | | | | | | | | | ||
Statement of Operations Data: | | | | | | | | | | | | | | ||
Operating costs and expenses: | | | | | | | | | | | | | | ||
Research and development
|
| | | $ | 113,931 | | | | | $ | 461,551 | | | ||
Patent costs
|
| | | | 197,731 | | | | | | 292,358 | | | ||
General and administrative
|
| | | | 1,969,960 | | | | | | 1,356,888 | | | ||
Total operating expenses
|
| | | | 2,281,622 | | | | | | 2,110,797 | | | ||
Loss from operations
|
| | | | (2,281,622 ) | | | | | | (2,110,797 ) | | | ||
Other expense (income): | | | | | | | | | | | | | | ||
Interest income
|
| | | | (525 ) | | | | | | (1,677 ) | | | ||
Interest expense
|
| | | | 213,516 | | | | | | 6,076 | | | ||
Other income
|
| | | | (21,148 ) | | | | | | (19,365 ) | | | ||
Total other expense (income)
|
| | | | 191,843 | | | | | | (14,966 ) | | | ||
Net loss
|
| | | $ | (2,473,465 ) | | | | | $ | (2,095,831 ) | | | ||
Cumulative preferred stock dividends
|
| | | | 589,462 | | | | | | 547,303 | | | ||
Accretion of discount on Series C preferred stock
|
| | | | 8,580 | | | | | | — | | | ||
Net loss applicable to common stockholders
|
| | | $ | (3,071,507 ) | | | | | $ | (2,643,134 ) | | | ||
Net loss per common share – basic and diluted
|
| | | $ | (6.79 ) | | | | | $ | (5.86 ) | | | ||
Weighted average common shares outstanding – basic and diluted
|
| | | | 452,509 | | | | | | 451,398 | | | ||
Pro forma information (1) | | | | ||||||||||||
Pro forma net loss
|
| | | $ | (2,473,465 ) | | | | | $ | (2,643,134 ) | | | ||
Pro forma net loss per share, basic and diluted (unaudited)
|
| | | $ | (0.73 ) | | | | | $ | (0.81 ) | | | ||
Pro forma weighted average shares outstanding, basic and diluted
|
| | | | 3,384,952 | | | | | | 3,276,426 | | | ||
|
| | |
As of December 31, 2014
|
| |||||||||||||||
| | |
Actual
|
| |
Pro Forma
|
| |
Pro Forma
As Adjusted (1) |
| |||||||||
| | |
(Unaudited)
|
| |||||||||||||||
Balance Sheet Data: | | | | | | | | | | | | | | | | | | | |
Cash and cash equivalents
|
| | | $ | 2,747,248 | | | | | $ | 2,747,248 | | | | | | 20,165,648 | | |
Working Capital
|
| | | | 1,549,613 | | | | | | 1,549,613 | | | | | | 18,968,013 | | |
Total assets
|
| | | | 2,963,320 | | | | | | 2,963,320 | | | | | | 20,381,720 | | |
Accounts payable, accrued expenses and other liabilities
|
| | | | 1,254,750 | | | | | | 1,254,750 | | | | | | 1,254,750 | | |
Notes payable
|
| | | | — | | | | | | — | | | | | | | | |
Preferred stock subject to redemption
|
| | | | 16,203,612 | | | | | | — | | | | | | — | | |
Common stock and preferred stock
|
| | | | 9,353 | | | | | | 3,788 | | | | | | 5,608 | | |
Additional paid-in capital
|
| | | | 3,399,924 | | | | | | 19,609,101 | | | | | | 37,025,681 | | |
Accumulated deficit
|
| | | | (17,904,319 ) | | | | | | (17,904,319 ) | | | | | | (17,904,319 ) | | |
Total stockholders’ equity (deficit)
|
| | | | (14,495,042 ) | | | | | | 1,708,570 | | | | | | 19,126,970 | | |
| | |
As of December 31, 2014
|
| ||||||||||||||||||
| | |
Actual
|
| |
Pro Forma
|
| |
Pro Forma
As Adjusted (1) |
| ||||||||||||
| | | | | | | | |
(Unaudited)
|
| | | | | | | ||||||
Cash and cash equivalents
|
| | | $ | 2,747,248 | | | | | $ | 2,747,248 | | | | | $ | 20,165,648 | | | |||
Long-term debt (inclusive of current portion)
|
| | | | — | | | | | | — | | | |
|
| ||||||
Preferred stock subject to redemption, $0.001 par value, 16,378,646 shares authorized, 13,399,668 shares issued and outstanding, actual; no shares issued and outsanding, pro forma; and no shares authorized, no shares issued and outstanding, pro forma as adjusted
|
| | | | 16,203,612 | | | | | | — | | | |
|
| ||||||
Preferred stock, $0.001 par value, 50,000,000 shares
authorized, issued and outstanding, actual; 8,887,500 shares authorized, no shares issued and outsanding, pro forma; and [•] shares authorized, no shares issued and outstanding, pro forma as adjusted |
| | | | 8,888 | | | | | | — | | | |
|
| ||||||
Common stock, $0.001 par value, 50,000,000 shares
authorized, 465,384 shares issued and outstanding, actual; 50,000,000 shares authorized, 3,788,064 shares issued and outsanding, pro forma; and shares authorized, 5,608,060 shares issued and outstanding, pro forma as adjusted |
| | | | 465 | | | | | | 3,788 | | | | | | 5,608 | | | |||
Additional paid-in capital
|
| | | | 3,339,924 | | | | | | 19,609,101 | | | | | | 37,025,681 | | | |||
Accumulated deficit
|
| | | | (17,904,319 ) | | | | | | (17,904,319 ) | | | | | | (17,904,319 ) | | | |||
Total stockholders’ equity (deficit)
|
| | | | (14,495,042 ) | | | | | | 1,708,570 | | | | | | 19,126,970 | | | |||
Total capitalization
|
| | | $ | 1,708,570 | | | | | $ | 1,708,570 | | | | | $ | 19,126,970 | | | |||
|
|
Assumed initial public offering price per share
|
| | | | | | | | | $ | 11.00 | | | ||
|
Historical net tangible book value per share as of December 31,
2014 |
| | | $ | 3.67 | | | | | | | | | ||
|
Decrease per share due to the conversion of all shares of preferred stock
|
| | | $ | (3.22 ) | | | | | | | | | ||
|
Pro forma net tangible book value per share as of December 31, 2014
|
| | | $ | 0.45 | | | | | | | | | ||
|
Increase per share attributable to new investors
|
| | | $ | 2.96 | | | | | | | | | ||
|
Pro forma net tangible book value per share after this offering
|
| | | | | | | | | | 3.41 | | | ||
|
Dilution per share to new investors
|
| | | | | | | | | $ | 7.59 | | | ||
|
| | |
Shares Purchased
|
| |
Total Consideration
|
| |
Average Price
Per Share |
| ||||||||||||||||||||||||||
| | |
Number
|
| |
Percentage
|
| |
Amount
|
| |
Percentage
|
| |||||||||||||||||||||||
Existing stockholders
|
| | | | 3,788,060 | | | | | | 67.55 % | | | | | $ | 19,562,514 | | | | | | 49.42 % | | | | | $ | 5.16 | | | |||||
New Investors
|
| | | | 1,820,000 | | | | | | 32.45 % | | | | | $ | 20,020,000 | | | | | | 50.58 % | | | | | $ | 11.00 | | | |||||
Total
|
| | | | 5,608,060 | | | | | | 100.00 % | | | | | $ | 39,582,514 | | | | | | 100.00 % | | | | | $ | 7.06 | | | |||||
|
| | |
Year ended December 31, 2014
|
| |||||||||
| | |
Low
|
| |
High
|
| ||||||
Expected dividend yield
|
| | | | 0.00 % | | | | | | 0.00 % | | |
Expected stock-price volatility
|
| | | | 51.45 % | | | | | | 64.24 % | | |
Risk-free interest rate
|
| | | | 0.88 % | | | | | | 3.04 % | | |
Expected term of options
|
| | | | 5 | | | | | | 10 | | |
Stock price
|
| | | $ | 1.14 | | | | | $ | 5.86 | | |
|
Year
|
| |
Share Class
|
| |
Price per Share
|
|
|
2005
|
| |
Common Stock
(a)
|
| |
$1.79
|
|
|
2006
|
| |
Series A-2 Preferred Stock
(a)
(b)
|
| |
$0.40
|
|
|
2008 – 2009
|
| |
Series A-3 Preferred Stock
(b)
|
| |
$0.62
|
|
|
2010 – 2013
|
| |
Series B Preferred Stock
(b)
|
| |
$1.19
|
|
|
2014
|
| |
Series C Preferred Stock
(b)
|
| |
$1.30
|
|
| | |
Valuation Dates
|
| |||||||||||||||
| | |
November 7, 2013
|
| |
July 31, 2012
|
| |
December 31, 2010
|
| |||||||||
Risk-free rate
|
| | | | 0.55 % | | | | | | 0.57 % | | | | | | 2.01 % | | |
Maturity (years)
|
| | | | 3.00 | | | | | | 4.00 | | | | | | 5.00 | | |
Volatility
|
| | | | 58.00 % | | | | | | 61.00 % | | | | | | 61.00 % | | |
Grant Date
|
| |
Number of Common
Shares Underlying Options Granted |
| |
Exercise Price
per Common Share |
| |
Estimated Fair Value
per Share of Common Stock |
| |
Intrinsic Value
Option |
| ||||||
2005
|
| | | | 58,321 | | | |
$0.07
|
| | | $ | 1.79 | | | |
$1.72
|
|
2009
|
| | | | 60,559 | | | |
$0.72 – $0.79
|
| | | $ | 4.43 | | | |
$3.71 – $3.64
|
|
2011
|
| | | | 33,846 | | | |
$1.00
|
| | | $ | 1.00 | | | |
$0.00
|
|
2012
|
| | | | 60,019 | | | |
$1.14
|
| | | $ | 1.14 | | | |
$0.00
|
|
2013
|
| | | | 100,000 | | | |
$1.14 – $1.30
|
| | | $ | 1.14 | | | |
$0.00
|
|
2014
|
| | | | 1,626,740 | | | |
$5.86 – $13.23
|
| | | $ | 5.86 | | | |
$0.00
|
|
| | |
Options
|
| |
Weighted Average
Exercise Price |
| ||||||||
Outstanding at December 31, 2013
|
| | | | 226,793 | | | | | $ | 1.083 | | | ||
Granted
|
| | | | 1,626,740 | | | | | | 7.722 | | | ||
Exercised/Expired/Forfeited
|
| | | | (64,816 ) | | | | | | (0.888 ) | | | ||
Outstanding at December 31, 2014
|
| | | | 1,788,717 | | | | | $ | 7.128 | | | ||
Exercisable at December 31, 2014
|
| | | | 162,237 | | | | | $ | 4.053 | | | ||
Expected to be vested
|
| | | | 1,626,480 | | | | | $ | 7.434 | | | ||
|
| | |
For the Year Ended December 31,
|
| |
Dollar
Change |
| |
Percentage
Change |
| |||||||||||||||||||
| | |
2014
|
| |
2013
|
| ||||||||||||||||||||||
Statement of Operations Data: | | | | | | ||||||||||||||||||||||||
Operating costs and expenses | | | | ||||||||||||||||||||||||||
Research and development
|
| | | $ | 113,931 | | | | | $ | 461,551 | | | | | $ | (347,620 ) | | | | | | (75 )% | | | ||||
Patent costs
|
| | | | 197,731 | | | | | | 292,358 | | | | | | (94,627 ) | | | | | | (32 )% | | | ||||
General and administrative
|
| | | | 1,969,960 | | | | | | 1,356,888 | | | | | | 613,072 | | | | | | 45 % | | | ||||
Total operating expenses
|
| | | | 2,281,622 | | | | | | 2,110,797 | | | | | | 170,825 | | | | | | 8 % | | | ||||
Loss from operations
|
| | | | (2,281,622 ) | | | | | | (2,110,797 ) | | | | | | (170,825 ) | | | | | | 8 % | | | ||||
Other expense (income): | | | | | | ||||||||||||||||||||||||
Interest income
|
| | | | (525 ) | | | | | | (1,677 ) | | | | | | 1,152 | | | | | | (69 )% | | | ||||
Interest expense
|
| | | | 213,516 | | | | | | 6,076 | | | | | | 207,440 | | | | | | 3,414 % | | | ||||
Other income
|
| | | | (21,148 ) | | | | | | (19,365 ) | | | | | | (1,783 ) | | | | | | 9 % | | | ||||
Total other expense (income)
|
| | | | 191,843 | | | | | | (14,966 ) | | | | | | 206,809 | | | | | | (1,382 )% | | | ||||
Net Loss
|
| | | $ | (2,473,465 ) | | | | | $ | (2,095,831 ) | | | | | $ | (377,634 ) | | | | | | 18 % | | | ||||
|
| | |
For the Years Ended December 31,
|
| |||||||||||
| | |
2014
|
| |
2013
|
| ||||||||
Net cash provided by (used in): | | | | ||||||||||||
Operating activities
|
| | | $ | (1,157,385 ) | | | | | $ | (1,956,914 ) | | | ||
Investing activities
|
| | | | (1,166 ) | | | | | | (8,692 ) | | | ||
Financing activities
|
| | | | 3,457,573 | | | | | | 643,995 | | | ||
Net increase (decrease) in cash
|
| | | $ | 2,299,022 | | | | | $ | (1,321,611 ) | | | ||
|
Name
|
| |
Age
|
| |
Position(s)
|
|
Executive Officers: | | | | ||||
Michael D. Step | | |
55
|
| | Chief Executive Officer and Director | |
Samuel O. Lynn | | |
47
|
| | Chief Financial Officer | |
Andrew J. Ritter | | |
32
|
| | President and Director | |
Ira E. Ritter | | |
65
|
| | Executive Chairman, Chief Strategic Officer and Director | |
Non-Employee Directors: | | | | ||||
Noah Doyle | | |
47
|
| | Director | |
Matthew W. Foehr | | |
42
|
| | Director | |
Paul V. Maier | | |
67
|
| | Director | |
Gerald T. Proehl | | |
56
|
| | Director | |
Name and Principal Position
|
| |
Year
|
| |
Salary
($) |
| |
Bonus
($) |
| |
Option
Awards (1) ($) |
| |
All Other
Compensation ($) |
| |
Total
($) |
| ||||||||||||||||||
Michael D. Step
Chief Executive Officer |
| | | | 2014 | | | | | $ | 90,000 | | | | | $ | — | | | | | $ | 2,332,410 | | | | | $ | — | | | | | $ | 2,422,410 | | |
Andrew J. Ritter
President |
| | | | 2014 | | | | | $ | 204,070 | | | | | $ | — | | | | | $ | 1,253,638 | | | | | $ | 7,428 | | | | | $ | 1,465,136 | | |
Ira E. Ritter
Executive Chairman and Chief Strategic Officer |
| | | | 2014 | | | | | $ | 182,922 | | | | | $ | — | | | | | $ | 1,253,638 | | | | | $ | 13,082 | | | | | $ | 1,449,642 | | |
Name
|
| |
Number of
Securities Underlying Unexercised Options Exercisable |
| |
Number of
Securities Underlying Unexercised Options Unexercisable |
| |
Option
Exercise Price ($) |
| |
Option
Expiration Date |
| ||||||||||||
Michael D. Step
|
| | | | 16,352 (1) | | | | | | 9,811 (1) | | | | | $ | 1.14 | | | | | | 8/16/2022 | | |
| | | 646,537 (2) | | | | | | — | | | | | $ | 5.86 | | | | | | 12/2/2024 | | | ||
| | | 73,377 (3) | | | | | | — | | | | | $ | 5.86 | | | | | | 12/2/2024 | | | ||
| | | — | | | | | | (4) | | | | | $ | 5.86 | | | | | | 12/2/2024 | | | ||
Andrew J. Ritter
|
| | | | 3,370 (5) | | | | | | 45,581 (5) | | | | | $ | 1.27 | | | | | | 9/25/2023 | | |
| | | 20,979 (6) | | | | | | — | | | | | $ | 5.86 | | | | | | 12/2/2024 | | | ||
| | | — | | | | | | 432,434 (7) | | | | | | (7) | | | | | | 12/2/2024 | | | ||
Ira E. Ritter
|
| | | | 3,370 (8) | | | | | | 45,581 (8) | | | | | $ | 1.27 | | | | | | 9/25/2023 | | |
| | | 20,979 (9) | | | | | | — | | | | | $ | 5.86 | | | | | | 12/2/2024 | | | ||
| | | — | | | | | | 432,434 (10) | | | | | | (10) | | | | | | 12/2/2024 | | |
Beneficial Owner
|
| |
Number of Shares
Beneficially Owned |
| |
Percentage of Common Stock
Beneficially Owned |
| ||||||||||||
|
Before Offering
|
| |
After Offering
|
| ||||||||||||||
Five Percent Stockholders | | | | | | | | | | | | | | | |||||
Javelin Venture Partners I SPV I, LLC
(1)(2)(3)
|
| | | | 645,507 | | | | | | 17.0 % | | | | | | 11.5 % | | |
Javelin Venture Partners, L.P.
(1)(2)(3)
|
| | | | 1,331,028 | | | | | | 35.1 % | | | | | | 23.7 % | | |
Stonehenge Partners LLC
(5)(6)(7)
|
| | | | 817,272 | | | | | | 21.6 % | | | | | | 14.6 % | | |
Executive Officers, Directors and Director Nominees | | | | | | | | | | | | | | | |||||
Michael D. Step
(8)
|
| | | | 738,991 | | | | | | 16.3 % | | | | | | 11.6 % | | |
Andrew J. Ritter
(6)(9)
|
| | | | 24,776 | | | | | | * | | | | | | * | | |
Ira E. Ritter
(7)(10)
|
| | | | 24,776 | | | | | | * | | | | | | * | | |
Noah Doyle
(3)(11)
|
| | | | 22,727 | | | | | | * | | | | | | * | | |
Matthew W. Foehr
|
| | | | — | | | | | | * | | | | | | * | | |
Paul V. Maier
|
| | | | — | | | | | | * | | | | | | * | | |
Gerald T. Proehl
|
| | | | — | | | | | | * | | | | | | * | | |
All current executive officers and directors as a group (8 persons)
|
| | | | 811,270 | | | | | | 17.4 % | | | | | | 12.4 % | | |
Underwriter
|
| |
Number of
Shares |
| ||||
Aegis Capital Corp
|
| |
|
| ||||
Chardan Capital Markets, LLC
|
| | | | | | | |
Barrington Research Associates, Inc.
|
| | | | | | | |
Total | | | | | 1,820,000 | | | |
|
| | |
Per
Share |
| |
Total Without
Over-Allotment Option |
| |
Total With
Over-Allotment Option |
| |||||||||
Public offering price
|
| | | $ | | | | | $ | | | | | $ | | | |||
Underwriting discount (7%)
|
| | | $ | | | | | $ | | | | | $ | | | |||
Proceeds, before expense, to us
|
| | | $ | | | | | $ | | | | | $ | | | |||
Non-accountable expense allowance (1%)
(1)
|
| | | $ | | | | | $ | | | | | $ | | | |
| | |
Page
|
||
AUDITED FINANCIAL STATEMENTS | | | | | |
| | | | F-2 | |
| | | | F-3 | |
| | | | F-4 | |
| | | | F-5 | |
| | | | F-6 | |
| | | | F-7 |
| | |
December 31,
|
| |||||||||||
| | |
2014
|
| |
2013
|
| ||||||||
ASSETS | | | | | | | | | | | | | | ||
Current assets
|
| | | | | | | | | | | | | ||
Cash and cash equivalents
|
| | | $ | 2,747,248 | | | | | $ | 448,226 | | | ||
Prepaid expenses
|
| | | | 57,115 | | | | | | 76,636 | | | ||
Total current assets
|
| | | | 2,804,363 | | | | | | 524,862 | | | ||
Other assets
|
| | | | 10,331 | | | | | | 15,359 | | | ||
Deferred offering costs
|
| | | | 143,454 | | | | | | — | | | ||
Property and equipment, net
|
| | | | 5,172 | | | | | | 7,485 | | | ||
Total Assets
|
| | | $ | 2,963,320 | | | | | $ | 547,706 | | | ||
LIABILITIES AND STOCKHOLDERS’ DEFICIT | | | | | | | | | | | | | | ||
Current liabilities | | | | | | | | | | | | | | ||
Accounts payable
|
| | | $ | 1,083,597 | | | | | $ | 834,496 | | | ||
Accrued expenses
|
| | | | 168,635 | | | | | | 27,443 | | | ||
Notes payable
|
| | | | — | | | | | | 31,500 | | | ||
Other liabilities
|
| | | | 2,518 | | | | | | 4,517 | | | ||
Total current liabilities
|
| | | | 1,254,750 | | | | | | 897,956 | | | ||
Preferred stock subject to redemption, $0.001 par value, 16,378,646 and 11,878,646 shares authorized as of December 31, 2014 and December 31, 2013, respectively, 13,399,668 and 10,408,652 shares issued and outstanding at December 31, 2014 and December 2013, respectively. $9.1 million aggregate liquidation preference of Series B cumulative preferred stock at December 31, 2014
|
| | | | 16,203,612 | | | | | | 12,413,876 | | | ||
Stockholders’ deficit | | | | | | | | | | | | | | ||
Preferred stock, par value $0.001, 8,887,500 shares authorized, issued and outstanding as of December 31, 2014 and December 31, 2013
|
| | | | 8,888 | | | | | | 8,888 | | | ||
Common stock, par value $0.001, 50,000,000 and 26,500,000 shares
authorized as of December 31, 2014 and December 31, 2013, respectively; 465,384 and 451,398 shares issued and outstanding as of December 31, 2014 and December 31, 2013, respectively |
| | | | 465 | | | | | | 451 | | | ||
Additional paid-in capital
|
| | | | 3,399,924 | | | | | | 2,059,347 | | | ||
Accumulated deficit
|
| | | | (17,904,319 ) | | | | | | (14,832,812 ) | | | ||
Total stockholders’ deficit
|
| | | | (14,495,042 ) | | | | | | (12,764,126 ) | | | ||
Total Liabilities and Stockholders’ Deficit
|
| | | $ | 2,963,320 | | | | | $ | 547,706 | | | ||
|
| | |
For the Years Ended December 31,
|
| |||||||||||
| | |
2014
|
| |
2013
|
| ||||||||
Operating costs and expenses: | | | | | | | | | | | | | | ||
Research and development
|
| | | $ | 113,931 | | | | | $ | 461,551 | | | ||
Patent costs
|
| | | | 197,731 | | | | | | 292,358 | | | ||
General and administrative
|
| | | | 1,969,960 | | | | | | 1,356,888 | | | ||
Total operating expenses
|
| | | | 2,281,622 | | | | | | 2,110,797 | | | ||
Operating loss
|
| | | | (2,281,622 ) | | | | | | (2,110,797 ) | | | ||
Other expense (income): | | | | | | | | | | | | | | ||
Interest income
|
| | | | (525 ) | | | | | | (1,677 ) | | | ||
Interest expense
|
| | | | 213,516 | | | | | | 6,076 | | | ||
Other income
|
| | | | (21,148 ) | | | | | | (19,365 ) | | | ||
Total other expense (income)
|
| | | | 191,843 | | | | | | (14,966 ) | | | ||
Net loss
|
| | | | (2,473,465 ) | | | | | $ | (2,095,831 ) | | | ||
Cumulative preferred stock dividends
|
| | | | 589,462 | | | | | | 547,303 | | | ||
Accretion of discount on Series C preferred stock
|
| | | | 8,580 | | | | | | — | | | ||
Net loss applicable to common stockholders
|
| | | $ | (3,071,507 ) | | | | | $ | (2,643,134 ) | | | ||
Net loss per common share – basic and diluted
|
| | | $ | (6.79 ) | | | | | $ | (5.86 ) | | | ||
Weighted average common shares outstanding – basic and diluted
|
| | | | 452,509 | | | | | | 451,398 | | | ||
|
| | |
Preferred
Stock Subject to Redemption |
| |
Stockholders’ Deficit
|
| |
Total
Stockholders’ Deficit |
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| | |
Preferred Stock
|
| |
Common Stock
|
| |
Additional
Paid-in Capital |
| |
Accumulated
Deficit |
| |||||||||||||||||||||||||||||||||||||||||||||||||||
| | |
Shares
|
| |
Amount
|
| |
Shares
|
| |
Amount
|
| |
Shares
|
| |
Amount
|
| |||||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2012
|
| | | | 9,885,423 | | | | | $ | 11,093,677 | | | | | | 8,887,500 | | | | | $ | 8,888 | | | | | | 451,398 | | | | | $ | 451 | | | | | $ | 2,032,697 | | | | | $ | (12,189,678 ) | | | | | $ | (10,147,642 ) | | | |||||||||
Conversion of note payable into shares
|
| | | | 103,234 | | | | | | 122,901 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 12,253 | | | | | | — | | | | | | 12,253 | | | |||||||||
Prepaid forward sale of Series B preferred stock
|
| | | | — | | | | | | 150,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | |||||||||
Issuance of shares subject to redemption
|
| | | | 419,995 | | | | | | 499,995 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | |||||||||
Stock based compensation
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 14,397 | | | | | | — | | | | | | 14,397 | | | |||||||||
Cumulative dividends on Series B preferred stock
|
| | | | — | | | | | | 547,303 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (547,303 ) | | | | | | (547,303 ) | | | |||||||||
Net loss
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (2,095,831 ) | | | | | | (2,095,831 ) | | | |||||||||
Balance at December 31, 2013
|
| | | | 10,408,652 | | | | | $ | 12,413,876 | | | | | | 8,887,500 | | | | | $ | 8,888 | | | | | | 451,398 | | | | | $ | 451 | | | | | $ | 2,059,347 | | | | | $ | (14,832,812 ) | | | | | $ | (12,764,126 ) | | | |||||||||
Conversion of notes payable into preferred stock subject to redemption and warrants to purchase common stock
|
| | | | 621,788 | | | | | | 660,635 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 136,733 | | | | | | — | | | | | | 136,733 | | | |||||||||
Issuance of preferred stock subject to
redemption and warrants to purchase common stock, net of offering cost of $68,767 |
| | | | 2,369,228 | | | | | | 2,531,059 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 482,068 | | | | | | — | | | | | | 482,068 | | | |||||||||
Exercise of options on common stock
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 13,986 | | | | | | 14 | | | | | | 14,386 | | | | | | — | | | | | | 14,400 | | | |||||||||
Stock based compensation
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 707,390 | | | | | | — | | | | | | 707,390 | | | |||||||||
Cumulative dividends on Series B preferred stock
|
| | | | — | | | | | | 589,462 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (589,462 ) | | | | | | (589,462 ) | | | |||||||||
Accretion of discount on Series C preferred stock
|
| | | | — | | | | | | 8,580 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (8,580 ) | | | | | | (8,580 ) | | | |||||||||
Net loss
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (2,473,465 ) | | | | | | (2,473,465 ) | | | |||||||||
Balance at December 31, 2014
|
| | | | 13,399,668 | | | | | $ | 16,203,612 | | | | | | 8,887,500 | | | | | $ | 8,888 | | | | | | 465,384 | | | | | $ | 465 | | | | | $ | 3,399,924 | | | | | $ | (17,904,319 ) | | | | | $ | (14,495,042 ) | | | |||||||||
|
| | |
For the Years Ended December 31,
|
| |||||||||
| | |
2014
|
| |
2013
|
| ||||||
Cash flows from operating activities | | | | | | | | | | | | | |
Net loss
|
| | | $ | (2,473,465 ) | | | | | $ | (2,095,831 ) | | |
Adjustments to reconcile net loss to net cash used in operating activities:
|
| | | ||||||||||
Depreciation
|
| | | | 3,479 | | | | | | 2,139 | | |
Stock based compensation
|
| | | | 707,390 | | | | | | 14,397 | | |
Change in fair value of put embedded in convertible debt
|
| | | | (21,148 ) | | | | | | — | | |
Accretion of discount on convertible debt
|
| | | | 10,192 | | | | | | — | | |
Non-cash interest on conversion of debt
|
| | | | 184,445 | | | | | | — | | |
Increase (decrease) in cash attributable to changes in operating assets
and liabilities: |
| | | ||||||||||
Prepaid expenses
|
| | | | 19,521 | | | | | | 1,655 | | |
Other assets
|
| | | | 5,028 | | | | | | (7,903 ) | | |
Accounts payable
|
| | | | 249,101 | | | | | | 119,742 | | |
Accrued expenses
|
| | | | 160,071 | | | | | | 4,370 | | |
Other liabilities
|
| | | | (1,999 ) | | | | | | 4,517 | | |
Net cash used in operating activities
|
| | | | (1,157,385 ) | | | | | | (1,956,914 ) | | |
Cash flows from investing activities | | | | | | | | | | | | | |
Purchase of property and equipment
|
| | | | (1,166 ) | | | | | | (8,692 ) | | |
Net cash used in investing activities
|
| | | | (1,166 ) | | | | | | (8,692 ) | | |
Cash flows from financing activities | | | | | | | | | | | | | |
Deferred offering costs
|
| | | | (143,454 ) | | | | | | — | | |
Proceeds from borrowing under notes payable
|
| | | | 605,000 | | | | | | — | | |
Repayment of borrowing under note payable
|
| | | | (31,500 ) | | | | | | (6,000 ) | | |
Net proceeds from issuance of preferred stock subject to redemption and warrants to purchase common stock
|
| | | | 3,013,127 | | | | | | 499,995 | | |
Proceeds received on prepaid forward sale of preferred stock subject to redemption
|
| | | | — | | | | | | 150,000 | | |
Proceeds from exercise of options on common stock
|
| | | | 14,400 | | | | | | — | | |
Net cash provided by financing activities
|
| | | | 3,457,573 | | | | | | 643,995 | | |
Net increase (decrease) in cash
|
| | | | 2,299,022 | | | | | | (1,321,611 ) | | |
Cash at beginning of period
|
| | | | 448,226 | | | | | | 1,769,837 | | |
Cash at end of period
|
| | | $ | 2,747,248 | | | | | $ | 448,226 | | |
Non-cash financing activities: | | | | | | | | | | | | | |
Conversion of account payable to note payable
|
| | | $ | — | | | | | $ | 37,500 | | |
Conversion of notes payable into preferred stock subject to redemption and warrants to purchase common stock
|
| | | $ | 612,923 | | | | | $ | 135,154 | | |
Cumulative preferred stock dividends
|
| | | $ | 589,462 | | | | | $ | 547,303 | | |
Accretion of Series C
|
| | | $ | 8,580 | | | | |||||
Cash paid for interest
|
| | | $ | — | | | | | $ | — | | |
Cash paid for taxes
|
| | | $ | — | | | | | $ | — | | |
| | | | | |
As of December 31,
|
| |||||||||||
| | |
Estimated Life
|
| |
2014
|
| |
2013
|
| ||||||||
Computers and equipment
|
| |
5 years
|
| | | $ | 5,487 | | | | | $ | 4,320 | | | ||
Furniture and fixtures
|
| |
7 years
|
| | | | 4,270 | | | | | | 4,270 | | | ||
Leasehold improvements
|
| |
7 years
|
| | | | — | | | | | | 3,500 | | | ||
Total property and equipment
|
| | | | | | | 9,757 | | | | | | 12,090 | | | ||
Accumulated depreciation
|
| | | | | | | (4,585 ) | | | | | | (4,605 ) | | | ||
Total property and equipment, net of accumulated depreciation
|
| | | | | | $ | 5,172 | | | | | $ | 7,485 | | | ||
|
| | |
Year ended December 31, 2014
|
| |||||||||
| | |
Low
|
| |
High
|
| ||||||
Expected dividend yield
|
| | | | 0.00 % | | | | | | 0.00 % | | |
Expected stock-price volatility
|
| | | | 51.45 % | | | | | | 64.24 % | | |
Risk-free interest rate
|
| | | | 0.88 % | | | | | | 3.04 % | | |
Expected term of options
|
| | | | 5 | | | | | | 10 | | |
Stock price
|
| | | $ | 1.14 | | | | | $ | 5.86 | | |
|
Year
|
| |
Share Class
|
| |
Price per Share
|
|
|
2005
|
| |
Common Stock
(a)
|
| |
$1.79
|
|
|
2006
|
| |
Series A-2 Preferred Stock
(a)
(b)
|
| |
$0.40
|
|
|
2008 – 2009
|
| |
Series A-3 Preferred Stock
(b)
|
| |
$0.62
|
|
|
2010 – 2013
|
| |
Series B Preferred Stock
(b)
|
| |
$1.19
|
|
|
2014
|
| |
Series C Preferred Stock
(b)
|
| |
$1.30
|
|
| | |
Valuation Dates
|
| |||||||||||||||
| | |
November 7, 2013
|
| |
July 31, 2012
|
| |
December 31, 2010
|
| |||||||||
Risk-free rate
|
| | | | 0.55 % | | | | | | 0.57 % | | | | | | 2.01 % | | |
Maturity (years)
|
| | | | 3.00 | | | | | | 4.00 | | | | | | 5.00 | | |
Volatility | | | | | 58.00 % | | | | | | 61.00 % | | | | | | 61.00 % | | |
Grant Date
|
| |
Number of Common
Shares Underlying Options Granted |
| |
Exercise Price
per Common Share |
| |
Estimated Fair Value
per Share of Common Stock |
| |
Intrinsic Value
Option |
| ||||||
2005 | | | | | 58,321 | | | |
$0.07
|
| | | $ | 1.79 | | | |
$1.72
|
|
2009 | | | | | 60,559 | | | |
$0.72 – $0.79
|
| | | $ | 4.43 | | | |
$3.71 – $3.64
|
|
2011 | | | | | 33,846 | | | |
$1.00
|
| | | $ | 1.00 | | | |
$0.00
|
|
2012 | | | | | 60,019 | | | |
$1.14
|
| | | $ | 1.14 | | | |
$0.00
|
|
2013 | | | | | 100,000 | | | |
$1.14 – $1.30
|
| | | $ | 1.14 | | | |
$0.00
|
|
2014 | | | | | 1,626,740 | | | |
$5.86 – $13.23
|
| | | $ | 5.86 | | | |
$0.00
|
|
| | |
Options
|
| |
Weighted Average
Exercise Price |
| ||||||||
Outstanding at December 31, 2013
|
| | | | 226,793 | | | | | $ | 1.083 | | | ||
Granted
|
| | | | 1,626,740 | | | | | | 7.722 | | | ||
Exercised/Expired/Forfeited
|
| | | | (64,816 ) | | | | | | (0.888 ) | | | ||
Outstanding at December 31, 2014
|
| | | | 1,788,717 | | | | | $ | 7.128 | | | ||
Exercisable at December 31, 2014
|
| | | | 162,237 | | | | | $ | 4.053 | | | ||
Expected to be vested
|
| | | | 1,626,480 | | | | | $ | 7.434 | | | ||
|
| | |
December 31,
|
| |||||||||||
| | |
2014
|
| |
2013
|
| ||||||||
Statutory U.S. federal rate
|
| | | | 34.0 % | | | | | | 34.0 % | | | ||
State income tax, net of federal benefit
|
| | | | 3.9 % | | | | | | 3.9 % | | | ||
Meals & entertainment
|
| | | | (0.3 )% | | | | | | (0.4 )% | | | ||
Others | | | | | (0.5 )% | | | | | | (2.8 )% | | | ||
Forward sale of preferred stock
|
| | | | (2.3 )% | | | | | | 0.0 % | | | ||
Non-cash interest on conversion
|
| | | | (2.8 )% | | | | | | 0.0 % | | | ||
Valuation allowance
|
| | | | (32.0 )% | | | | | | (34.7 )% | | | ||
Provision for income taxes
|
| | | | 0.0 % | | | | | | 0.0 % | | | ||
|
| | |
As of December 31,
|
| |||||||||||
| | |
2014
|
| |
2013
|
| ||||||||
Deferred tax assets: | | | | | | | | | | | | | | ||
Net operating loss carry forwards
|
| | | $ | 3,675,012 | | | | | $ | 3,306,227 | | | ||
Patent costs
|
| | | | 318,652 | | | | | | 243,722 | | | ||
Capitalized interest
|
| | | | 85,568 | | | | | | 8,518 | | | ||
Accrued vacation
|
| | | | 10,237 | | | | | | 6,192 | | | ||
Research and development credit
|
| | | | 200,482 | | | | | | 73,484 | | | ||
Stock based compensation
|
| | | | 383,381 | | | | | | 115,314 | | | ||
Other
|
| | | | 4,460 | | | | | | 4,828 | | | ||
Gross deferred tax assets
|
| | | | 4,677,792 | | | | | | 3,758,285 | | | ||
Valuation allowance
|
| | | | (4,677,792 ) | | | | | | (3,758,285 ) | | | ||
Net deferred tax assets
|
| | | $ | — | | | | | $ | — | | | ||
|
| | |
Total
|
| ||||
SEC registration fee
|
| | | $ | 3,045.37 | | | |
FINRA filing fee
|
| | | $ | 4,431.20 | | | |
NASDAQ listing fee
|
| | | $ | 50,000.00 | | | |
Printing and engraving expenses
|
| | | $ | 50,000.00 | | | |
Legal fees and expenses
|
| | | $ | 450,000.00 | | | |
Accounting fees and expenses
|
| | | $ | 200,000.00 | | | |
Transfer agent and registrar fees
|
| | | $ | 5,000.00 | | | |
Miscellaneous
|
| | | $ | 237,523.43 | | | |
Total
|
| | | $ | 1,000,000.00 | | | |
|
|
Signature
|
| |
Title
|
| |
Date
|
|
|
/s/ Michael D. Step
Michael D. Step
|
| |
Chief Executive Officer and Director
(Principal Executive Officer) |
| |
April 24, 2015
|
|
|
/s/ Samuel O. Lynn
Samuel O. Lynn
|
| |
Chief Financial Officer
(Principal Financial and Accounting Officer) |
| |
April 24, 2015
|
|
|
/s/ Ira E. Ritter
Ira E. Ritter
|
| |
Executive Chairman, Chief Strategic Officer and Director
|
| |
April 24, 2015
|
|
|
/s/ Andrew J. Ritter
Andrew J. Ritter
|
| |
President and Director
|
| |
April 24, 2015
|
|
|
*
Noah Doyle
|
| |
Director
|
| |
April 24, 2015
|
|
|
*
Matthew W. Foehr
|
| |
Director
|
| |
April 24, 2015
|
|
|
/s/ Paul V. Maier
Paul V. Maier
|
| |
Director
|
| |
April 24, 2015
|
|
|
/s/ Gerald T. Proehl
Gerald T. Proehl
|
| |
Director
|
| |
April 24, 2015
|
|
| *By: | | |
/s/ Andrew J. Ritter
AndrewJ. Ritter
Attorney-in-fact |
|
Exhibit No.
|
| |
Description
|
|
1.1* | | | Form of Underwriting Agreement | |
3.1** | | | Restated Certificate of Incorporation of Ritter Pharmaceuticals, Inc. | |
3.2** | | | Bylaws of Ritter Pharmaceuticals, Inc. | |
3.3* | | | Form of Amended and Restated Certificate of Incorporation of Ritter Pharmaceuticals, Inc. | |
3.4* | | | Form of Amended and Restated Bylaws of Ritter Pharmaceuticals, Inc. | |
4.1* | | | Form of Common Stock Certificate of Ritter Pharmaceuticals, Inc. | |
4.2** | | | Amended and Restated Investors’ Rights Agreement, dated as of November 17, 2010, by and among Ritter Pharmaceuticals, Inc. and the persons and entities named therein | |
4.3** | | | Amendment No. 1 to the Amended and Restated Investors’ Rights Agreement, dated as of January 13, 2011, by and among Ritter Pharmaceuticals, Inc. and the persons and entities named therein | |
4.4** | | | Amendment No. 2 to the Amended and Restated Investors’ Rights Agreement, dated as of February 6, 2012, by and among Ritter Pharmaceuticals, Inc. and the persons and entities named therein | |
4.5** | | | Amendment No. 3 to the Amended and Restated Investors’ Rights Agreement, dated as of December 4, 2014, by and among Ritter Pharmaceuticals, Inc. and the persons and entities named therein | |
4.6* | | | Form of Representative’s Warrant | |
5.1* | | | Opinion of Reed Smith LLP | |
10.1** | | | Office Lease, dated June 25, 2013, by and between Douglas Emmett 1997, LLC and Ritter Pharmaceuticals, Inc. | |
10.2** | | | Offer Letter, dated December 2, 2014, by and between Michael D. Step and Ritter Pharmaceuticals, Inc. | |
10.3** | | | Executive Compensation Plan | |
10.4** | | | Executive Severance & Change in Control Agreement, dated October 1, 2014, by and between Ritter Pharmaceuticals, Inc. and Michael D. Step | |
10.5** | | | 2008 Stock Plan | |
10.6** | | | 2009 Stock Plan | |
10.7* | | | Form of 2015 Stock Plan | |
10.8** | | | Stock Option Agreement, dated December 2, 2014, by and between Ritter Pharmaceuticals, Inc. and Michael D. Step | |
10.9** | | | Stock Option Agreement, dated December 2, 2014, by and between Ritter Pharmaceuticals, Inc. and Michael D. Step | |
10.10** | | | Stock Option Agreement, dated December 2, 2014, by and between Ritter Pharmaceuticals, Inc. and Michael D. Step | |
10.11** | | | Stock Option Agreement, dated September 25, 2013, by and between Ritter Pharmaceuticals, Inc. and Andrew J. Ritter | |
10.12** | | | Stock Option Agreement, dated December 2, 2014, by and between Ritter Pharmaceuticals, Inc. and Andrew J. Ritter | |
10.13** | | | Stock Option Agreement, dated December 2, 2014, by and between Ritter Pharmaceuticals, Inc. and Andrew J. Ritter | |
10.14** | | | Stock Option Agreement, dated September 25, 2013, by and between Ritter Pharmaceuticals, Inc. and Ira E. Ritter | |
10.15** | | | Stock Option Agreement, dated December 2, 2014, by and between Ritter Pharmaceuticals, Inc. and Ira E. Ritter | |
Exhibit No.
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Description
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10.16** | | | Stock Option Agreement, dated December 2, 2014, by and between Ritter Pharmaceuticals, Inc. and Ira E. Ritter | |
10.17** | | | Research and Development Agreement & License, dated November 30, 2010, by and among Kolu Pohaku Technologies, LLC, Kolu Pohaku Management, LLC and Ritter Pharmaceuticals, Inc. | |
10.18** | | | Amendment No. 1 to Research and Development Agreement & License, dated July 6, 2011, by and among Kolu Pohaku Technologies, LLC, Kolu Pohaku Management, LLC and Ritter Pharmaceuticals, Inc. | |
10.19** | | | Amendment No. 2 to Research and Development Agreement & License, dated September 30, 2011, by and among Kolu Pohaku Technologies, LLC, Kolu Pohaku Management, LLC and Ritter Pharmaceuticals, Inc. | |
10.20** | | | Amendment No. 3 to Research and Development Agreement & License, dated February 6, 2012, by and among Kolu Pohaku Technologies, LLC, Kolu Pohaku Management, LLC and Ritter Pharmaceuticals, Inc. | |
10.21** | | | Amendment No. 4 to Research and Development Agreement & License, dated November 4, 2013, by and among Kolu Pohaku Technologies, LLC, Kolu Pohaku Management, LLC and Ritter Pharmaceuticals, Inc. | |
10.22** | | | Put and Call Option Agreement, dated November 30, 2010, by and between Kolu Pohaku Technologies, LLC and Ritter Pharmaceuticals, Inc. | |
10.23** | | | Subordinated Convertible Promissory Note to SJ Investment Company, LLC, dated May 23, 2014, in the principal amount of $25,000.00 | |
10.24** | | | Subordinated Convertible Promissory Note to Javelin Venture Partners, L.P., dated May 23, 2014, in the principal amount of $350,000.00 | |
10.25** | | | Subordinated Convertible Promissory Note to Javelin Venture Partners, L.P., dated September 8, 2014, in the principal amount of $80,000.00 | |
10.26** | | | Unsecured Promissory Note to Javelin Venture Partners, L.P., dated October 9, 2014, in the principal amount of $70,000.00 | |
10.27** | | | Subordinated Convertible Promissory Note, dated October 20, 2014, in the principal amount of $80,000.00 | |
10.28** | | | Series C Preferred Stock and Warrant Purchase Agreement, dated December 4, 2014, by and among Ritter Pharmaceuticals, Inc. and the Investors named therein | |
10.29 | | | Form of Indemnification Agreement between Ritter Pharmaceuticals, Inc. and each of its directors and executive officers | |
10.30 | | | Clinical Supply and Operation Agreement, dated December 16, 2009, by and among Ritter Pharmaceuticals, Inc. and Ricerche Sperimentali Montale SpA and Inalco SpA | |
10.31 | | | Amendment 1 to the Clinical Supply and Cooperation Agreement, dated September 25, 2010, by and among Ritter Pharmaceuticals, Inc. and Ricerche Sperimentali Montale SpA and Inalco SpA | |
21.1** | | | Subsidiaries of Registrant | |
23.1 | | | Consent of Mayer Hoffman McCann P.C., independent registered public accounting firm | |
23.2* | | | Consent of Reed Smith LLP (included in Exhibit 5.1) | |
24.1** | | | Power of Attorney (included on applicable signature pages) | |
Exhibit 10.29
RITTER PHARMACEUTICALS, INC.
INDEMNIFICATION AGREEMENT
This Indemnification Agreement (“ Agreement ”), dated as of ______, _____, is by and between Ritter Pharmaceuticals, Inc., a Delaware corporation (the “ Company ”) and [NAME OF DIRECTOR/OFFICER] (the “ Indemnitee ”).
WHEREAS, Indemnitee is (or is being elected as) a director or officer of the Company;
WHEREAS, both the Company and Indemnitee recognize the increased risk of litigation and other claims being asserted against directors and officers of public companies;
WHEREAS, the Board of Directors of the Company (the “ Board ”) has determined that enhancing the ability of the Company to retain and attract as directors and officers the most capable persons is in the best interests of the Company and that the Company therefore should seek to assure such persons that indemnification and insurance coverage is available; and
WHEREAS, in recognition of the need to provide Indemnitee with substantial protection against personal liability, in order to procure Indemnitee's service as a director or officer of the Company and to enhance Indemnitee's ability to serve the Company in an effective manner, and in order to provide such protection pursuant to express contract rights (intended to be enforceable irrespective of, among other things, any amendment to the Company’s Certificate of Incorporation or Bylaws (collectively, the “ Constituent Documents ”), any change in the composition of the Board or any change in control or business combination transaction relating to the Company), the Company wishes to provide in this Agreement for the indemnification of, and the advancement of Expenses (as defined in Section 1(f) below) to, Indemnitee as set forth in this Agreement and to the extent insurance is maintained for the coverage of Indemnitee under the Company’s directors' and officers' liability insurance policies.
NOW, THEREFORE, in consideration of the foregoing and the Indemnitee's agreement to provide services to the Company, the parties agree as follows:
1. | Definitions . For purposes of this Agreement, the following terms shall have the following meanings: |
a) | “ Beneficial Owner ” has the meaning given to the term "beneficial owner" in Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”). |
b) | “ Change in Control ” means the occurrence after the date of this Agreement of any of the following events: |
(i) | any Person is or becomes the Beneficial Owner, directly or indirectly, of securities of the Company representing more than 25% or more of the Company's then outstanding Voting Securities, unless the change in relative Beneficial |
Ownership of the Company's securities by any Person results solely from a reduction in the aggregate number of outstanding shares of securities entitled to vote generally in the election of directors; provided, however, that the following acquisitions will not constitute a Change in Control: (A) any issuance of Voting Securities directly from the Company that is approved by the Incumbent Board (as defined in Section 1(b)(iii) below), (B) any acquisition by the Company of Voting Securities, (C) any acquisition of Voting Securities by any employee benefit plan (or related trust) sponsored or maintained by the Company or any subsidiary of the Company, (D) any acquisition of Voting Securities by an underwriter holding securities of the Company in connection with a public offering thereof, or € any acquisition of Voting Securities by any Person pursuant to a Business Combination that complies with clauses (A), (B) and (C) of Section 1(a)(ii) below;
(ii) | the consummation of a reorganization, merger or consolidation of the Company, a sale or other disposition (whether by sale, taxable or nontaxable exchange, formation of a joint venture or otherwise) of all or substantially all of the assets of the Company, or other transaction involving the Company (each, a “Business Combination”), unless, in each case, immediately following such Business Combination, (A) all or substantially all of the individuals and entities who were the beneficial owners of Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 50% of the combined voting power of the then outstanding Voting Securities of the entity resulting from such Business Combination or any direct or indirect parent corporation thereof (including, without limitation, an entity which as a result of such transaction owns the Company or all or substantially all of the Company’s assets either directly or through one or more subsidiaries), (B) no Person other than the Company beneficially owns 25% or more of the combined voting power of then then outstanding Voting Securities of the entity resulting from such Business Combination or any direct or indirect parent corporation thereof (disregarding all “acquisitions” described in subsections (A) through (C) of Section 1(a)(i)), and (C) at least a majority of the members of the Board of Directors of the entity resulting from such Business Combination or any direct or indirect parent corporation thereof were members of the Incumbent Board (as defined in Section 1(b)(iii) below) at the time of the execution of the initial agreement or of the action of the Board of Directors providing for such Business Combination; |
(iii) | during any period of two consecutive years, not including any period prior to the execution of this Agreement, individuals who at the beginning of such period constituted the Board (including for this purpose any new directors whose election by the Board or nomination for election by the Company's stockholders was approved by a vote of at least two-thirds (2/3) of the directors then still in |
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office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved) (the “ Incumbent Board ”) cease for any reason to constitute at least a majority of the Board; or
(iv) | the stockholders of the Company approve a plan of complete liquidation or dissolution of the Company, except pursuant to a Business Combination that complies with clauses (A), (B) and (C) of Section 1(a)(iii). |
c) | “ Claim ” means: |
(i) | any threatened, pending or completed action, suit, proceeding or alternative dispute resolution mechanism, whether civil, criminal, administrative, arbitrative, investigative or other, and whether made pursuant to federal, state or other law; or |
(ii) | any inquiry, hearing or investigation that the Indemnitee determines might lead to the institution of any such action, suit, proceeding or alternative dispute resolution mechanism. |
d) | “ Delaware Court ” shall have the meaning ascribed to it in Section e) below. |
e) | “ Disinterested Director ” means a director of the Company who is not and was not a party to the Claim in respect of which indemnification is sought by Indemnitee. |
f) | “ Expenses ” means any and all expenses, including attorneys' and experts' fees, court costs, transcript costs, travel expenses, duplicating, printing and binding costs, telephone charges, and all other costs and expenses incurred in connection with investigating, defending, being a witness in or participating in (including on appeal), or preparing to defend, be a witness or participate in, any Claim. Expenses also shall include (i) Expenses incurred in connection with any appeal resulting from any Claim, including without limitation the premium, security for, and other costs relating to any cost bond, supersedeas bond, or other appeal bond or its equivalent, and (ii) for purposes of Section 5 only, Expenses incurred by Indemnitee in connection with the interpretation, enforcement or defense of Indemnitee's rights under this Agreement, by litigation or otherwise. Expenses, however, shall not include amounts paid in settlement by Indemnitee or the amount of judgments or fines against Indemnitee. |
g) | “ Expense Advance ” means any payment of Expenses advanced to Indemnitee by the Company pursuant to Section 4 or Section 5 hereof. |
h) | “ Indemnifiable Event ” means any event or occurrence, whether occurring before, on or after the date of this Agreement, related to the fact that Indemnitee is or was a director, officer, employee or agent of the Company or any subsidiary of the Company, or is or |
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was serving at the request of the Company as a director, officer, employee, member, manager, trustee or agent of any other corporation, limited liability company, partnership, joint venture, trust or other entity or enterprise (each, an “ Enterprise ”) or by reason of an action or inaction by Indemnitee in any such capacity (whether or not serving in such capacity at the time any Loss is incurred for which indemnification can be provided under this Agreement).
i) | “ Independent Counsel ” means a law firm, or a member of a law firm, that is experienced in matters of corporation law and neither presently performs, nor in the past five years has performed, services for either: (i) the Company or Indemnitee (other than in connection with matters concerning Indemnitee under this Agreement or of other indemnitees under similar agreements) or (ii) any other party to the Claim giving rise to a claim for indemnification hereunder. Notwithstanding the foregoing, the term "Independent Counsel" shall not include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Company or Indemnitee in an action to determine Indemnitee's rights under this Agreement. |
j) | “ Losses ” means any and all Expenses, damages, losses, liabilities, judgments, fines, penalties (whether civil, criminal or other), ERISA excise taxes, amounts paid or payable in settlement, including any interest, assessments, any federal, state, local or foreign taxes imposed as a result of the actual or deemed receipt of any payments under this Agreement and all other charges paid or payable in connection with investigating, defending, being a witness in or participating in (including on appeal), or preparing to defend, be a witness or participate in, any Claim. |
k) | “ Person ” means any individual, corporation, firm, partnership, joint venture, limited liability company, estate, trust, business association, organization, governmental entity or other entity or group and includes the meaning set forth in Sections 13(d) and 14(d) of the Exchange Act. |
l) | “ Standard of Conduct Determination ” shall have the meaning ascribed to it in Section b) below. |
m) | “ Voting Securities ” means any securities of the Company that vote generally in the election of directors. |
2. | Services to the Company . Indemnitee agrees to serve, or continue to serve, as the case may be, as a director or officer of the Company for so long as Indemnitee is duly elected or appointed or until Indemnitee tenders his or her resignation or is no longer serving in such capacity. This Agreement shall not be deemed an employment agreement between the Company (or any of its subsidiaries or any Enterprise) and Indemnitee. Indemnitee specifically acknowledges that his or her employment with or service to the Company or any of its subsidiaries or any Enterprise is at |
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will and the Indemnitee may be discharged at any time for any reason, with or without cause, except as may be otherwise provided in any written employment agreement between Indemnitee and the Company (or any of its subsidiaries or any Enterprise), other applicable formal severance policies duly adopted by the Board or, with respect to service as a director or officer of the Company, by the Company's Constituent Documents or Delaware law. This Agreement shall continue in force after Indemnitee has ceased to serve as a director or officer of the Company or, at the request of the Company, of any of its subsidiaries or any Enterprise, as provided in Section 12 hereof.
3. | Indemnification . Subject to Section 9 and Section 10 of this Agreement, the Company shall indemnify Indemnitee, to the fullest extent permitted by the laws of the State of Delaware in effect on the date hereof, or as such laws may from time to time hereafter be amended to increase the scope of such permitted indemnification, against any and all Losses if Indemnitee was or is or becomes a party to or participant in, or is threatened to be made a party to or participant in, any Claim by reason of or arising in part out of an Indemnifiable Event, including, without limitation, Claims brought by or in the right of the Company, Claims brought by third parties, and Claims in which the Indemnitee is solely a witness. |
4. | Advancement of Expenses . Indemnitee shall have the right to advancement by the Company, prior to the final disposition of any Claim by final adjudication to which there are no further rights of appeal, of any and all Expenses actually and reasonably paid or incurred by Indemnitee in connection with any Claim arising out of an Indemnifiable Event. Indemnitee's right to such advancement is not subject to the satisfaction of any standard of conduct. Without limiting the generality or effect of the foregoing, within sixty (60) days after any request by Indemnitee, the Company shall, in accordance with such request, (a) pay such Expenses on behalf of Indemnitee, (b) advance to Indemnitee funds in an amount sufficient to pay such Expenses, or (c) reimburse Indemnitee for such Expenses. In connection with any request for Expense Advances, Indemnitee shall not be required to provide any documentation or information to the extent that the provision thereof would undermine or otherwise jeopardize attorney-client privilege. Indemnitee hereby undertakes to repay any advance to the extent that it is ultimately determined that Indemnitee is not entitled to be indemnified by the Company. Indemnitee's obligation to reimburse the Company for Expense Advances shall be unsecured and no interest shall be charged thereon. |
5. | Indemnification for Expenses in Enforcing Rights . To the fullest extent allowable under applicable law, the Company shall also indemnify against, and, if requested by Indemnitee, shall advance to Indemnitee subject to and in accordance with Section 4, any Expenses actually and reasonably paid or incurred by Indemnitee in connection with any action or proceeding by Indemnitee for (a) indemnification or reimbursement or advance payment of Expenses by the Company under any provision of this Agreement, or under any other agreement or provision of the Constituent Documents now or hereafter in effect relating to Claims relating to Indemnifiable Events, and/or (b) recovery under any directors' and officers' liability insurance policies maintained by the Company. However, in the event that Indemnitee is ultimately determined not to be entitled to such indemnification or insurance recovery, as the case may be, then all amounts |
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advanced under this Section 5 shall be repaid. Indemnitee shall be required to reimburse the Company in the event that a final judicial determination is made that such action brought by Indemnitee was frivolous or not made in good faith.
6. | Partial Indemnity . If Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for a portion of any Losses in respect of a Claim related to an Indemnifiable Event but not for the total amount thereof, the Company shall nevertheless indemnify Indemnitee for the portion thereof to which Indemnitee is entitled. |
7. | Notification and Defense of Claims . |
a) | Notification of Claims . Indemnitee shall notify the Company in writing as soon as practicable of any Claim which could relate to an Indemnifiable Event or for which Indemnitee could seek Expense Advances, including a brief description (based upon information then available to Indemnitee) of the nature of, and the facts underlying, such Claim. The failure by Indemnitee to timely notify the Company hereunder shall not relieve the Company from any liability hereunder unless the Company’s ability to participate in the defense of such claim was materially and adversely affected by such failure. If at the time of the receipt of such notice, the Company has directors' and officers' liability insurance in effect under which coverage for Claims related to Indemnifiable Events is potentially available, the Company shall give prompt written notice to the applicable insurers in accordance with the procedures set forth in the applicable policies. The Company shall provide to Indemnitee a copy of such notice delivered to the applicable insurers, and copies of all subsequent correspondence between the Company and such insurers regarding the Claim, in each case substantially concurrently with the delivery or receipt thereof by the Company. |
b) | Defense of Claims . The Company shall be entitled to participate in the defense of any Claim relating to an Indemnifiable Event at its own expense and, except as otherwise provided below, to the extent the Company so wishes, it may assume the defense thereof with counsel reasonably satisfactory to Indemnitee. After notice from the Company to Indemnitee of its election to assume the defense of any such Claim, the Company shall not be liable to Indemnitee under this Agreement or otherwise for any Expenses subsequently directly incurred by Indemnitee in connection with Indemnitee's defense of such Claim other than reasonable costs of investigation, including an investigation in connection with determining whether there exists a conflict of interest of the type described in clause (ii) below, or as otherwise provided below. Indemnitee shall have the right to employ its own legal counsel in such Claim, but all Expenses related to such counsel incurred after notice from the Company of its assumption of the defense shall be at Indemnitee's own expense; provided, however, that if (i) Indemnitee's employment of its own legal counsel has been authorized by the Company, (ii) Indemnitee has reasonably determined that there may be a conflict of interest between Indemnitee and the Company in the defense of such Claim, (iii) after a Change in Control, Indemnitee's |
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employment of its own counsel has been approved by the Independent Counsel or (iv) the Company shall not in fact have employed counsel to assume the defense of such Claim, then Indemnitee shall be entitled to retain its own separate counsel (but not more than one law firm plus, if applicable, local counsel in respect of any such Claim) and all Expenses related to such separate counsel shall be borne by the Company.
8. | Procedure upon Application for Indemnification . In order to obtain indemnification pursuant to this Agreement, Indemnitee shall submit to the Company a written request therefor, including in such request such documentation and information as is reasonably available to Indemnitee and is reasonably necessary to determine whether and to what extent Indemnitee is entitled to indemnification following the final disposition of the Claim, provided that documentation and information need not be so provided to the extent that the provision thereof would undermine or otherwise jeopardize attorney-client privilege. Indemnification shall be made insofar as the Company determines Indemnitee is entitled to indemnification in accordance with Section 9 below. |
9. | Determination of Right to Indemnification . |
a) | Mandatory Indemnification; Indemnification as a Witness . |
(i) | To the extent that Indemnitee shall have been successful on the merits or otherwise in defense of any Claim relating to an Indemnifiable Event or any portion thereof or in defense of any issue or matter therein, including without limitation dismissal without prejudice, Indemnitee shall be indemnified against all Losses relating to such Claim in accordance with Section 3 to the fullest extent allowable by law, and no Standard of Conduct Determination (as defined in Section b)) shall be required. |
(ii) | To the extent that Indemnitee's involvement in a Claim relating to an Indemnifiable Event is to prepare to serve and serve as a witness, and not as a party, the Indemnitee shall be indemnified against all Losses incurred in connection therewith to the fullest extent allowable by law and no Standard of Conduct Determination (as defined in Section b)) shall be required. |
b) | Standard of Conduct . To the extent that the provisions of Section a) are inapplicable to a Claim related to an Indemnifiable Event that shall have been finally disposed of, any determination of whether Indemnitee has satisfied any applicable standard of conduct under Delaware law that is a legally required condition to indemnification of Indemnitee hereunder against Losses relating to such Claim and any determination that Expense Advances must be repaid to the Company (a “ Standard of Conduct Determination ”) shall be made as follows: |
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(i) | if no Change in Control has occurred, (A) by a majority vote of the Disinterested Directors, even if less than a quorum of the Board, (B) by a committee of Disinterested Directors designated by a majority vote of the Disinterested Directors, even though less than a quorum or (C) if there are no such Disinterested Directors, by Independent Counsel in a written opinion addressed to the Board, a copy of which shall be delivered to Indemnitee; and |
(ii) | if a Change in Control shall have occurred, (A) if the Indemnitee so requests in writing, by a majority vote of the Disinterested Directors, even if less than a quorum of the Board or (B) otherwise, by Independent Counsel in a written opinion addressed to the Board, a copy of which shall be delivered to Indemnitee. |
The Company shall indemnify and hold harmless Indemnitee against and, if requested by Indemnitee, shall reimburse Indemnitee for, or advance to Indemnitee, within ten (10) days of such request, any and all Expenses incurred by Indemnitee in cooperating with the person or persons making such Standard of Conduct Determination.
c) | Making the Standard of Conduct Determination . The Company shall use its reasonable best efforts to cause any Standard of Conduct Determination required under Section b) to be made as promptly as practicable. If the person or persons designated to make the Standard of Conduct Determination under Section b) shall not have made a determination within 30 days after the later of (A) receipt by the Company of a written request from Indemnitee for indemnification pursuant to Section 8 (the date of such receipt being the “ Notification Date ”) and (B) the selection of an Independent Counsel, if such determination is to be made by Independent Counsel, then Indemnitee shall be deemed to have satisfied the applicable standard of conduct; provided that such 30-day period may be extended for a reasonable time, not to exceed an additional 30 days, if the person or persons making such determination in good faith requires such additional time to obtain or evaluate information relating thereto. Notwithstanding anything in this Agreement to the contrary, no determination as to entitlement of Indemnitee to indemnification under this Agreement shall be required to be made prior to the final disposition of any Claim. |
d) | Payment of Indemnification . If, in regard to any Losses: |
(i) | Indemnitee shall be entitled to indemnification pursuant to Section a); |
(ii) | no Standard Conduct Determination is legally required as a condition to indemnification of Indemnitee hereunder; or |
(iii) | Indemnitee has been determined or deemed pursuant to Section b) or Section c) to have satisfied the Standard of Conduct Determination, |
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then the Company shall pay to Indemnitee, within ten (10) days after the later of (A) the Notification Date or (B) the earliest date on which the applicable criterion specified in clause (i), (ii) or (iii) is satisfied, an amount equal to such Losses.
e) | Selection of Independent Counsel for Standard of Conduct Determination . If a Standard of Conduct Determination is to be made by Independent Counsel pursuant to Section (i), the Independent Counsel shall be selected by the Board of Directors, and the Company shall give written notice to Indemnitee advising him or her of the identity of the Independent Counsel so selected. If a Standard of Conduct Determination is to be made by Independent Counsel pursuant to Section (ii), the Independent Counsel shall be selected by Indemnitee, and Indemnitee shall give written notice to the Company advising it of the identity of the Independent Counsel so selected. In either case, Indemnitee or the Company, as applicable, may, within ten (10) days after receiving written notice of selection from the other, deliver to the other a written objection to such selection; provided, however, that such objection may be asserted only on the ground that the Independent Counsel so selected does not satisfy the criteria set forth in the definition of "Independent Counsel" in Section i), and the objection shall set forth with particularity the factual basis of such assertion. Absent a proper and timely objection, the person or firm so selected shall act as Independent Counsel. If such written objection is properly and timely made and substantiated, (i) the Independent Counsel so selected may not serve as Independent Counsel unless and until such objection is withdrawn or a court has determined that such objection is without merit; and (ii) the non-objecting party may, at its option, select an alternative Independent Counsel and give written notice to the other party advising such other party of the identity of the alternative Independent Counsel so selected, in which case the provisions of the two immediately preceding sentences, the introductory clause of this sentence and numbered clause (i) of this sentence shall apply to such subsequent selection and notice. If applicable, the provisions of clause (ii) of the immediately preceding sentence shall apply to successive alternative selections. If no Independent Counsel that is permitted under the foregoing provisions of this Section e) to make the Standard of Conduct Determination shall have been selected within 20 days after the Company gives its initial notice pursuant to the first sentence of this Section e) or Indemnitee gives its initial notice pursuant to the second sentence of this Section e), as the case may be, either the Company or Indemnitee may petition the Court of Chancery of the State of Delaware (“ Delaware Court ”) to resolve any objection which shall have been made by the Company or Indemnitee to the other's selection of Independent Counsel and/or to appoint as Independent Counsel a person to be selected by the Court or such other person as the Court shall designate, and the person or firm with respect to whom all objections are so resolved or the person or firm so appointed will act as Independent Counsel. In all events, the Company shall pay all of the reasonable fees and expenses of the Independent Counsel incurred in connection with the Independent Counsel’s determination pursuant to Section b). |
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f) | Presumptions and Defenses . |
(i) | Indemnitee's Entitlement to Indemnification . In making any Standard of Conduct Determination, the person or persons making such determination shall presume that Indemnitee has satisfied the applicable standard of conduct and is entitled to indemnification, and the Company shall have the burden of proof to overcome that presumption and establish that Indemnitee is not so entitled. Any Standard of Conduct Determination that is adverse to Indemnitee may be challenged by the Indemnitee in the Delaware Court. No determination by the Company (including by its directors or any Independent Counsel) that Indemnitee has not satisfied any applicable standard of conduct may be used as a defense to any legal proceedings brought by Indemnitee to secure indemnification or reimbursement or advance payment of Expenses by the Company hereunder or create a presumption that Indemnitee has not met any applicable standard of conduct. |
(ii) | Reliance as a Safe Harbor . For purposes of this Agreement, and without creating any presumption as to a lack of good faith if the following circumstances do not exist, Indemnitee shall be deemed to have acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the Company if Indemnitee's actions or omissions to act are taken in good faith reliance upon the records of the Company, including its financial statements, or upon information, opinions, reports or statements furnished to Indemnitee by the officers or employees of the Company or any of its subsidiaries in the course of their duties, or by committees of the Board or by any other Person (including legal counsel, accountants and financial advisors) as to matters Indemnitee reasonably believes are within such other Person's professional or expert competence and who has been selected with reasonable care by or on behalf of the Company. In addition, the knowledge and/or actions, or failures to act, of any director, officer, agent or employee of the Company shall not be imputed to Indemnitee for purposes of determining the right to indemnity hereunder. |
(iii) | No Other Presumptions . For purposes of this Agreement, the termination of any Claim by judgment, order, settlement (whether with or without court approval) or conviction, or upon a plea of nolo contendere or its equivalent, will not create a presumption that Indemnitee did not meet any applicable standard of conduct or have any particular belief, or that indemnification hereunder is otherwise not permitted. |
(iv) | Defense to Indemnification and Burden of Proof . It shall be a defense to any action brought by Indemnitee against the Company to enforce this Agreement (other than an action brought to enforce a claim for Losses incurred in defending against a Claim related to an Indemnifiable Event in advance of its final disposition) that it is not permissible under applicable law for the Company to |
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indemnify Indemnitee for the amount claimed. In connection with any such action or any related Standard of Conduct Determination, the burden of proving such a defense or that the Indemnitee did not satisfy the applicable standard of conduct shall be on the Company.
(v) | Resolution of Claims . The Company acknowledges that a settlement or other disposition short of final judgment may be successful on the merits or otherwise for purposes of Section (i) if it permits a party to avoid expense, delay, distraction, disruption and uncertainty. In the event that any Claim relating to an Indemnifiable Event to which Indemnitee is a party is resolved in any manner other than by adverse judgment against Indemnitee (including, without limitation, settlement of such action, claim or proceeding with our without payment of money or other consideration) it shall be presumed that Indemnitee has been successful on the merits or otherwise for purposes of Section (i). The Company shall have the burden of proof to overcome this presumption. |
10. | Exclusions from Indemnification . Notwithstanding anything in this Agreement to the contrary, the Company shall not be obligated to: |
a) | indemnify or advance funds to Indemnitee for Expenses or Losses with respect to proceedings initiated by Indemnitee, including any proceedings against the Company or its directors, officers, employees or other indemnitees and not by way of defense, except: |
(i) | proceedings referenced in Section 5 above (unless a court of competent jurisdiction determines that each of the material assertions made by Indemnitee in such proceeding was not made in good faith or was frivolous); or |
(ii) | where the Company has joined in or the Board has consented to the initiation of such proceedings. |
b) | indemnify Indemnitee if a final decision by a court of competent jurisdiction determines that such indemnification is prohibited by applicable law. |
c) | indemnify Indemnitee for the disgorgement of profits arising from the purchase or sale by Indemnitee of securities of the Company in violation of Section 16(b) of the Exchange Act, or any similar successor statute. |
d) | indemnify or advance funds to Indemnitee for Indemnitee's reimbursement to the Company of any bonus or other incentive-based or equity-based compensation previously received by Indemnitee or payment of any profits realized by Indemnitee from the sale of securities of the Company, as required in each case under the Exchange Act (including any such reimbursements under Section 304 of the Sarbanes-Oxley Act of 2002 in connection with an accounting restatement of the Company or the payment to the |
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Company of profits arising from the purchase or sale by Indemnitee of securities in violation of Section 306 of the Sarbanes-Oxley Act).
11. | Settlement of Claims . The Company shall not be liable to Indemnitee under this Agreement for any amounts paid in settlement of any threatened or pending Claim related to an Indemnifiable Event effected without the Company's prior written consent, which shall not be unreasonably withheld; provided, however, that if a Change in Control has occurred, the Company shall be liable for indemnification of the Indemnitee for amounts paid in settlement if an Independent Counsel has approved the settlement. The Company shall not settle any Claim related to an Indemnifiable Event in any manner that would impose any Losses on the Indemnitee without the Indemnitee's prior written consent. |
12. | Duration . All agreements and obligations of the Company contained herein shall continue during the period that Indemnitee is a director or officer of the Company (or is serving at the request of the Company as a director, officer, employee, member, trustee or agent of another Enterprise) and shall continue thereafter (i) so long as Indemnitee may be subject to any possible Claim relating to an Indemnifiable Event (including any rights of appeal thereto) and (ii) throughout the pendency of any proceeding (including any rights of appeal thereto) commenced by Indemnitee to enforce or interpret his or her rights under this Agreement, even if, in either case, he or she may have ceased to serve in such capacity at the time of any such Claim or proceeding. |
13. | Non-Exclusivity . The rights of Indemnitee hereunder will be in addition to any other rights Indemnitee may have under the Constituent Documents, the General Corporation Law of the State of Delaware, any other contract or otherwise (collectively, “ Other Indemnity Provisions ”); provided, however, that (a) to the extent that Indemnitee otherwise would have any greater right to indemnification under any Other Indemnity Provision, Indemnitee will be deemed to have such greater right hereunder and (b) to the extent that any change is made to any Other Indemnity Provision which permits any greater right to indemnification than that provided under this Agreement as of the date hereof, Indemnitee will be deemed to have such greater right hereunder. The Company will not adopt any amendment to any of the Constituent Documents the effect of which would be to deny, diminish or encumber Indemnitee's right to indemnification under this Agreement or any Other Indemnity Provision. |
14. | Liability Insurance . For the duration of Indemnitee's service as a director or officer of the Company, and thereafter for so long as Indemnitee shall be subject to any pending Claim relating to an Indemnifiable Event, the Company shall use commercially reasonable efforts (taking into account the scope and amount of coverage available relative to the cost thereof) to continue to maintain in effect policies of directors' and officers' liability insurance providing coverage that is at least substantially comparable in scope and amount to that provided by the Company's current policies of directors' and officers' liability insurance. In all policies of directors' and officers' liability insurance maintained by the Company, Indemnitee shall be named as an insured in such a manner as to provide Indemnitee the same rights and benefits as are provided to the most favorably insured of the Company's |
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directors, if Indemnitee is a director, or of the Company's officers, if Indemnitee is an officer (and not a director) by such policy. Upon request, the Company will provide to Indemnitee copies of all directors' and officers' liability insurance applications, binders, policies, declarations, endorsements and other related materials.
15. | No Duplication of Payments . The Company shall not be liable under this Agreement to make any payment to Indemnitee in respect of any Losses to the extent Indemnitee has otherwise received payment under any insurance policy, the Constituent Documents, Other Indemnity Provisions or otherwise of the amounts otherwise indemnifiable by the Company hereunder. |
16. | Subrogation . In the event of payment to Indemnitee under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee. Indemnitee shall execute all papers required and shall do everything that may be necessary to secure such rights, including the execution of such documents necessary to enable the Company effectively to bring suit to enforce such rights. |
17. | Amendments . No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by both of the parties hereto. No waiver of any of the provisions of this Agreement shall be binding unless in the form of a writing signed by the party against whom enforcement of the waiver is sought, and no such waiver shall operate as a waiver of any other provisions hereof (whether or not similar), nor shall such waiver constitute a continuing waiver. Except as specifically provided herein, no failure to exercise or any delay in exercising any right or remedy hereunder shall constitute a waiver thereof. |
18. | Binding Effect . This Agreement shall be binding upon and inure to the benefit of and be enforceable by the parties hereto and their respective successors (including any direct or indirect successor by purchase, merger, consolidation or otherwise to all or substantially all of the business and/or assets of the Company), assigns, spouses, heirs and personal and legal representatives. The Company shall require and cause any successor (whether direct or indirect by purchase, merger, consolidation or otherwise) to all, substantially all or a substantial part of the business and/or assets of the Company, by written agreement in form and substances satisfactory to Indemnitee, expressly to assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place. |
19. | Severability . The provisions of this Agreement shall be severable in the event that any of the provisions hereof (including any portion thereof) are held by a court of competent jurisdiction to be invalid, illegal, void or otherwise unenforceable, and the remaining provisions shall remain enforceable to the fullest extent permitted by law. Upon such determination that any term or other provision is invalid, illegal or unenforceable, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated hereby be consummated as originally contemplated to the greatest extent possible. |
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20. | Notices . All notices, requests, demands and other communications hereunder shall be in writing and shall be deemed to have been duly given if delivered by hand, against receipt, or mailed, by postage prepaid, certified or registered mail: |
a) | if to Indemnitee, to the address set forth on the signature page hereto. |
b) | if to the Company, to: |
Ritter Pharmaceuticals, Inc.
Attn: Chief Executive Officer
1801 Century Park East #1820
Los Angeles, CA 90067
Notice of change of address shall be effective only when given in accordance with this Section. All notices complying with this Section shall be deemed to have been received on the date of hand delivery or on the third business day after mailing.
21. | Governing Law and Forum . This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Delaware applicable to contracts made and to be performed in such state without giving effect to its principles of conflicts of laws. The Company and Indemnitee hereby irrevocably and unconditionally: (a) agree that any action or proceeding arising out of or in connection with this Agreement shall be brought only in the Delaware Court and not in any other state or federal court in the United States, (b) consent to submit to the exclusive jurisdiction of the Delaware Court for purposes of any action or proceeding arising out of or in connection with this Agreement and (c) waive, and agree not to plead or make, any claim that the Delaware Court lacks venue or that any such action or proceeding brought in the Delaware Court has been brought in an improper or inconvenient forum. |
22. | Headings . The headings of the sections and paragraphs of this Agreement are inserted for convenience only and shall not be deemed to constitute part of this Agreement or to affect the construction or interpretation thereof. |
23. | Counterparts . This Agreement may be executed in one or more counterparts, each of which shall for all purposes be deemed to be an original, but all of which together shall constitute one and the same Agreement. |
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.
RITTER PHARMACEUTICALS, INC. | ||
By: |
Name: | |||
Title: | |||
INDEMNITEE | |||
Name: | |||
Address: | |||
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Exhibit 10.30
Clinical Supply and Cooperation Agreement Between Ritter & RSM/Inalco
CLINICAL SUPPLY AND COOPERATION AGREEMENT
(also referred to as “CSCA”)
BETWEEN
Ø RITTER Pharmaceuticals, Inc. a Delaware Corporation, with registered offices on 10100 Santa Monica Blvd. 42430, Los Angeles, CA 90067, hereinafter referred to as “ RITTER ”)
AND
Ø Ricerche Sperimentali Montale SpA , with sole shareholder, an Italian company, having its operational offices at Mentale (PT), via Garibaldi no. 33, and administrative offices at Milan, Italy, via Calabiana no. 18 (hereinafter referred to as “ RSM ”)
AND
Ø Inalco SpA , with sole shareholder, an Italian company, having its registered offices at: Milan, via Calabiana no. 18 (hereinafter referred to as “ Inalco ”)
Together defined as Parties , and each, individually, a Party .
The term RSM shall include Inalco, and all references to RSM shall be deemed to include Inalco.
WHEREAS
A. | RSM is an Affiliate (as defined herein) of the Inalco Group and is engaged in, among other things, the contract manufacture of active pharmaceutical ingredient for use in finished pharmaceutical product; |
B. | Inalco is an Affiliate of the Inalco Group and is engaged in the development and commercialization of pharmaceutical products, including but not limited to those manufactured by RSM; |
C. | RSM owns or has full and lawful access to various intellectual property rights, including patents, patent applications and know-how rights relating to the manufacture of Galacto-oligosaccharide products of low purity (56% or lower purity) (“GOS”); |
D. | RITTER is engaged in the business of research, developing, and marketing pharmaceutical products; |
E. | RSM has developed an improved form of GOS, with a higher purity (95% purity or higher) for use in the treatment of lactose intolerance, among other diseases; |
F. | RITTER has requested that RSM manufacture on behalf of RITTER and for RITTER’s sole benefit, an active pharmaceutical ingredient form of GOS of higher purity (95% or higher) for use in RITTER Product (as defined herein); |
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Clinical Supply and Cooperation Agreement Between Ritter & RSM/Inalco
G. | RSM wishes to manufacture the active pharmaceutical ingredient form of RITTER’s higher purity GOS on behalf of RITTER; |
H. | The Parties wish to cooperate in the Further supply by RSM, and the further purchase by RITTER of Improved GOS (as defined herein) for use in RITTER Product (as defined herein) and on this assumption, the Parties also set out in this CSCA certain binding terms and conditions to be included in a Proposed Agreement (as defined herein). |
Now,
THE PARTIES AGREE AS FOLLOWS
1. | DEFINITIONS |
1.1 The preamble to this CSCA form an integral part hereof. Clause headings in this CSCA are intended solely for convenience of reference and shall be given no effect in the interpretation of this CSCA.
1.2 In this CSCA the following definitions shall have the meaning respectively assigned thereto.
(a) Affiliates : any company, person or entity which, directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with a Party. “Control” means the legal or beneficial ownership 50% plus one share or more of the voting or equity interests or the power or right to direct the management and affairs of the business (including acting as the general partner of a limited partnership);
(b) Certificate of Analysis : the content of the Exhibit. A, stating the purity level and other quality requirements concerning Improved GOS which describes acceptance criteria;
(c) CGMP : those current practices, as amended from time to time, related to the manufacture of pharmaceutical products as set forth in the United States of America Food, Drug and Cosmetics Act (“MCA”) and such standards of good manufacturing as are required by the FDA or equivalent requirements of any other Regulatory Authority or set forth in the United States Code of Federal Regulations (Title 21, Parts 210-211) or equivalent requirements of any other Regulatory Authority;
(d) DMF : the Drug Master File for the manufacture of Improved GOS;
(e) FDA : the United States of America Food and Drug Administration and any successor agency or entity that may be established hereafter;
(f) Field : all uses in humans and animals;
(g) Improved GOS : a purified Galacto-oligosaccharides product, with a purity level not lower than 95%, and a minimal lactose content;
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Clinical Supply and Cooperation Agreement Between Ritter & RSM/Inalco
(h) Improved GOS IP : all right, title and interest to Improved GOS, the composition of matter of Improved GOS, and any information relating to Improved GOS including, but not limited to all Technical Information, patents, copyrights, trade secrets and other proprietary rights inherent therein and appurtenant thereto conceived, created, made or developed by RSM alone, or jointly with RITTER, pursuant to this CSCA and/or the Proposed Agreement;
(i) Proposed Agreement: the additional Agreement contemplated by the Parties regarding their further long term cooperation for the commercial supply of Improved GOS, certain binding terms of which are set forth in this CSCA;
(j) Regulatory Authority : any national, state, provincial or local or any foreign or supernational governmental, regulatory or administrative authority, agency or commission or any court, tribunal, judicial or arbitral body with jurisdiction over Improved GOS and/or RITTER Product including, without limitation, the FDA;
(k) RITTER Product : any product owned or controlled by RITTER incorporating or otherwise using improved GOS as its active pharmaceutical ingredient;
(l) Specifications : means the handling, composition, testing, production, packaging, storage and shipping procedures and specifications for Improved GOS as may be amended, modified or supplemented from time with the prior written approval of RITTER;
(m) Technical Information : all analytical methods, analytical tests, chemist test procedures, manufacturing information, manufacturing processes and/or procedures, master batch records, development records, chemical formula, clean processes and/or procedures, know-how, patents, trade secrets, processes, stability data and/or protocols, toxicological information, records, reports, samples, certificates of analysis, or any and all other information or expertise related to the ingredients, development, testing, manufacturing or composition of the Improved GOS, raw materials, impurities or batches;
(n) Territory : Worldwide;
(o) USD : United States of America Dollars.
2. | DMF AND OTHER INFORMATION |
2.1 RSM will provide RITTER with all documents and information (or copies thereof) that are necessary or useful for RITTER to obtain from any Regulatory Authority approval and authorization for RITTER to develop, clinically test, make, have made, use and commercially market: RITTER Product In the Territory; Including, but not limited to, the DMF for improved GOS.
2.2 Upon the request of RITTER, Confidential Information of RSM that is not Technical Information and is contained in the DMF for Improved GOS shall be submitted by RSM to the respective Regulatory Authority on behalf of RITTER with a letter of access and right of reference that enables RITTER and its Affiliates, which right is hereby granted to RD I ER and its Affiliates, to refer or to have the relevant Regulatory Authorities refer to such Confidential
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Clinical Supply and Cooperation Agreement Between Ritter & RSM/Inalco
Information of RSM contained in the DMF. In addition, RSM shall provide RITTER with a true and correct copy of the DMF, including all Confidential Information of RSM contained in the DMF, within ten (10) days after the exercise of the Exclusive Option, according to Section S. For purposes of clarity, RSM agree; that it will provide to Ritter: (a) within ten (10) days following the signing of this agreement, a copy of the non-confidential RSM information contained in the DMF; and (b) any pertinent information necessary to file an Investigational New Drug Application,
2.3 As consideration for the accomplishment of all the preparatory work and the final submission of the DMF by RSM to FDA, RITTER will pay to RSM the amount of USD 50,000 in two installments as follows:
(a) USD 25,000 (twenty-five thousand) already paid by RITTER in full as of the Effective Date of this CSCA;
(b) USD 25,000 (twenty-five thousand) to be paid, upon completion to RITTER’s satisfaction of the DMF submission to the FDA by RSM, and in no event later than thirty (30) clays after such completion, at the bank coordinates already given by RSM. Payment shall be made by RITTER USD.
2.4 If the FDA or any other Regulatory Authority reviewers find deficiencies in the information provided In the DMF, RSM will immediately rectify such deficiencies at no additional cost to RITTER. RSM shall notify RITTER of any such deficiencies as provided in Section 2.5 of this CSCA.
2.5 All the Parties shall reasonably co-operate in regulatory matters relating to the Improved GOS and the RITTER Product, so as to effect the necessary authorizations by the relevant Regulatory Authorities to enable RITTER and its Affiliates to develop, clinically test and market RITTER Product in the Territory. RSM shall keep the documentation relating to GOS and Improved GOS, including the DMF, continuously updated and shall promptly provide such up-dated information to RITTER free of charge on a continuous basis. RITTER will be notified in writing by RSM within forty-eight (48) hours after any regulatory questions regarding improved GOS are raised by the FDA or other Regulatory Authority, shall permit RITTER lo review and comment on any proposed response prior to submitting such response to the applicable Regulatory Authority. RSM shall provide RITTER with a copy of such final response at the same time a copy of the response is submitted to the applicable Regulatory Authority.
2.6 Facility
(a) RSM shall manufacture Improved GOS exclusively at the manufacturing facility of one of Inalco’s Group Affiliates (“Facility”). The Improved GOS, fur quantities indicated in Section 3, supplied to RITTER under this CSCA shall be manufactured at the Inalco Facility located at Montale, via Garibaldi no. 33.
(b) RSM shall ensure that any and all necessary licenses, registrations, and Regulatory Authority approvals have been obtained in connection with the Facility and equipment used in connection with the performance of the manufacture of Improved GOS by
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Clinical Supply and Cooperation Agreement Between Ritter & RSM/Inalco
RSM. RSM shall make available for inspection, upon the request of RITTER, documentation relating to such licenses„ registrations, and Regulatory Authority approvals.
2.7 Audit/Inspection by RITTER
(a) RSM agrees that RITTER and its agents shall, during the term of this CSCA, and for 3 (three years) following termination of the CSCA for any reason, have the right from time to time, upon reasonable prior notice to RSM, to inspect (and copy as applicable) the Facility including inspection of the materials and equipment used in the manufacture of Improved GOS and all records relating to the manufacture of Improved GOS, including, but not limited to, audits of all applicable financial records of RSM for the purpose of determining RSM’s compliance with the obligations under the terms of this CSCA. RITTER shall have no obligation or be deemed to have an obligation to inspect the facilities of RSM.
(b) Following such audit, if RITTER discusses its observations and conclusions with RSM, then RSM shall implement such corrective actions as may be reasonably determined by RITTER within sixty (60) days after notification thereof by RITTER, The cost for such corrective actions will be supported by RITTER, unless the corrective action deals with a matter for which RSM is responsible for up keep.
2.8 Regulatory Inspections
(a) RSM shall notify RITTER by telephone within five (5) business day, and in writing within ten (10) business days, after learning of any proposed or unannounced visit or inspection of the Facility by any Regulatory Authority.
(b) RSM shall provide to BUTTER a copy of (i) any report and other written communications received from such Regulatory Authority in connection with such visit or inspection, including any Form 483 observations and responses, and (ii) any other written communications received from such Regulatory Authority relating to Improved GOS or any equipment used in connection with the manufacture of Improved GOS, in each case, within three (3) business days after receipt thereof.
(c) RSM shall consult with RITTER concerning the response of RSM to each such communication if it relates W the manufacture of Improved GOS.
2.9 RSM shall maintain, or cause to be maintained, (i) all records necessary to comply with CGMP in the manufacture of Improved GOS, (ii) all manufacturing records, standard operating procedures, validation records, equipment log books, batch records, laboratory notebooks and all raw data relating to the manufacture and shipment of Improved GOS, and (iii) such other records as RITTER may reasonably require in order to ensure compliance by RSM with the terms of this Agreement. All such material shall be retained for such period as may be required by CGMP, or for such longer period as RITTER may reasonably request.
2.10 RSM agrees that it will notify RITTER of any incidents pertaining to the manufacture of Improved GOS that would require notification to Regulatory Authorities and will notify RITTER in advance of such notification.
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Clinical Supply and Cooperation Agreement Between Ritter & RSM/Inalco
2.11 Any and all marketing authorizations Issued by the FDA (including, but not limited to any New Drug Application) and/or any other Regulatory Authority in the Territory regarding Improved GOS and/or RITTER Product, and any regulatory filings in support of such marketing authorizations (including, but not limited to any Investigational New Drug Application), shall be owned solely and exclusively by RITTER.
3. | SUPPLY |
3.1 RSM and RITTER agree and acknowledge that RSM has supplied to RITTER and RITTER has purchased from RSM, 5 (five) kilos of Improved GOS. RSM warrants that (i) such Improved GOS was manufactured by RSM in strict compliance with CGMP and with Section 19 of Guidelines ICH Q7A, Specifications, and the terms and conditions of this CSCA; and (ii) RSM has received from RITTER payment in full of USD 35,000 (thirty-five thousand) for such Improved GOS.
3.2 RITTER will purchase additional 25 (twenty-five) kilos of Improved GOS at the price of USD 35,000 (thirty-five thousand), when entering into the clinical phase-2b. Payment of this additional amount shall be made by RITTER by direct remittance in USD within 30 (thirty) calendar days from receipt of delivery of such 25 (twenty-five) kilos of Improved GOS, All Improved GOS purchased under Section 3.1 and this Section 3,2 shall be delivered in accordance with Section 3.4.
3.3 RSM warrants that: (a) such Improved GOS has been manufactured in accordance with the Specifications, CGMP and any other applicable rules, and regulations; (b) improved GCS will meet the Specifications and will conform with the Certificate of Analysis; (c) such Improved GCS will not be adulterated or misbranded within the meaning of the FDCA, and similar provisions of the laws of other countries as to which Regulatory Approvals have been granted for the Improved GOS; (d) such Improved GOS will have been manufactured in facilities that are in compliance with all applicable laws at the time of such manufacture (including applicable inspection requirements of FDA and other Regulatory Authorities); and (e) such Improved GOS is not an article that may not be introduced into interstate commerce under the provisions of Sections 101 or 505 of the FDCA.
3.4 Delivery of Improved GOS
(a) RSM shall deliver and ship all improved GOS to RITTER care of the following address:
Velesco Pharmaceutical Services
46701 Commerce Center Drive
Plymouth, Michigan 48170 USA
or such other location that RITTER may designate by providing written notice to RSM.
(b) RSM shall ship all Improved GOS to RITTER CIP (Incoterms 2000) receiving point. Title and risk of loss to Improved GOS shall pass to RITTER at the time of receipt of delivery to RITTER. All Improved GOS has been packaged for shipment in accordance with the Specifications and any packing instructions provided by RITTER, and shall
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Clinical Supply and Cooperation Agreement Between Ritter & RSM/Inalco
be labeled for in the manner stated in the Specifications. Each shipment of Improved GOS shall be accompanied by a Certificate of Analysis.
(c) RSM shall be responsible, through Inalco Biochemicals inc., San Luis Obispo, California 93401 (“INALCO U.S.”), for all freight, insurance, handling, fees, taxes and other costs associated with the shipment of Improved GOS as well as all export licenses, import licenses and custom formalities for the import and export of Improved GOS between the country of origin and the destination country. Each delivery of Improved GOS shall be accompanied by the Certificate of Analysis for such Improved GOS,
3.5 In the event that FITTER determines within 30 (thirty) days after receipt of the Improved GOS (or within 30 (thirty) clays after discovery or any nonconformity that could not reasonably have been detected by customary inspection on delivery) that any Improved GOS supplied by RSM does not conform to the warranty set forth in Section 3.3, RITTER shall give RSM notice thereof. RSM shall supply RITTER with a conforming quantity of Improved GOS within 30 (thirty) days of receipt of such notice at RSM’s expense.
4. | CONFIDENTIALITY |
4.1 The Parties hereto agree to hold in strict confidence any and all information and know-how disclosed by the other Party subject to this Agreement including the contents of this Agreement (hereinafter referred to as “Confidential information”), to use such information and know-how only for the purposes of this Agreement, and to restrict access to such information and know-how to those persons entrusted to carry out the activities provided for hereunder and who are subject to a similar secrecy obligation. For clarification purposes, the Parties specifically agree, that the open part of the DMF, the Certificate of Analysis, and documents supplied by RSM to RITTER may be disclosed to Affiliates, consultants of RITTER, subcontractors and third Parties, all subject to appropriate confidentiality obligations, who are or may be involved in the manufacturing of tire RITTER Product and the distribution and marketing of the RITTER Product in the Territory. Additionally, (a) the Specifications and Improved GOS shall be considered the Confidential Information of RSM; until the exercise of the Exclusive Option, provided that RSM shall provide to RITTER the information required under Section 2.2., and (b) the terms of this Agreement shall be deemed the Confidential Information of both Parties. Notwithstanding the foregoing, RITTER shall have the right to disclose the terms of this Agreement to its actual and potential investors, legal advisors and potential acquirers pursuant to reasonable and customary confidentiality obligations.
4.2 The restrictions set forth in the preceding sentence shall not apply to Confidential information the receiving Party proves: (a) was, at the time of disclosure hereunder, in the public domain or becomes at a later date reasonably available to the public through no fault of the receiving Party; (b) was in the possession of the receiving Party prior to disclosure hereunder, as shown by the receiving Party by written or tangible evidence; (c) was disclosed to the receiving Party by a third party that has an independent right to disclose the information; (d) was independently developed by the receiving Party as evidenced by competent proof; or (e) was required to be disclosed by judicial order, statute or governmental regulation, provided that RSM is given reasonable prior written notice of any such required disclosure provided this is legally
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Clinical Supply and Cooperation Agreement Between Ritter & RSM/Inalco
and timely possible. This section shall survive termination or final accomplishment of this Agreement and any extension thereof for a period of ten years.
4.3 The terms of this Article 4 shall not be construed to limit either Party’s right to disclose the other Party’s Confidential Information if: (a) required in response to a valid order of a court of competent jurisdiction or other governmental authority of competent jurisdiction; provided that the receiving Party shall first have given notice to the disclosing Party and given the disclosing Party a reasonable opportunity to seek the confidential treatment of such Confidential Information (through protective order, injunctive relief or otherwise) and shall reasonably cooperate with the disclosing Party in seeking such treatment; provided further that the Confidential information disclosed in response to such cow I or governmental order shall be limited to that Confidential Information which is legally required to be disclosed; or (b) otherwise required by law to be disclosed.
5. | EXCLUSIVE OWNERSHIP OF RIGHTS AND TECHNICAL INFORMATION |
5.1 All ideas, patents, copyrights, trade secrets and other proprietary rights owned or controlled by either Party prior to April 3, 2009 are and shall remain the sole and exclusive property of such Party and no rights thereto are granted to the other.
5.2 (a) RSM hereby grants to RITTER an exclusive option in the Field and in the Territory to assignment of all Improved GOS IP (“Exclusive Option”). RITTER may exercise the Exclusive Option by: (i) paying RSM, USD one million, which payment shall be made ten (10) days following the Financing Receipt as defined in Section 7.2 of this Agreement provided RITTER’s investors consent to such payment (“First Option Payment”); and (ii) providing RSM with written notice of the exercise of the Exclusive Option. RSM shall cooperate with RITTER in RITTER’s efforts to obtain the Financing Receipt (“Financing Receipt Efforts”) and hereby consents to reasonable disclosure of RSM Confidential Information by RITTER as part of the Financing Receipt Efforts.
(b) Upon the receipt of the First Option Payment., RSM shall execute all instruments of assignment and other documentation necessary or reasonably requested by RITTER for the purpose of perfecting or maintaining RITTER’s assignment and ownership rights in Improved GOS IP.
(c) As additional consideration for full assignment to RITTER of all Improved GOS IP, RITTER shall pay to RSM, USD one million, which payment shall be made ten (10) clays following the approval by the FDA of the New Drug Application (commercial marketing authorization in the United States) for the first RITTER Product (“Second Option Payment”).
(d) Notwithstanding anything to the contrary contained in Section 5.2, let. c), in the event RITTER would not accomplish the payment of the Second Option Payment within the term indicated, RITTER expressly undertakes to assign back to RSM, the 100% of the Improved GOS IP assigned to RITTER by RSM, by executing, within three months from the unfulfilment, all instruments of assignment and other documentation necessary or reasonably for
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Clinical Supply and Cooperation Agreement Between Ritter & RSM/Inalco
the purpose of perfecting or maintaining RSM’s assignment and ownership rights in Improved GOS IP.
5.3 Notwithstanding anything to the contrary contained in Section 5.2, in the event RSM wishes to use any of the Technical Information that relates to manufacturing processes generally in other RSM manufacturing operations, RITTER shall grant to RSM a nonexclusive, worldwide, royalty-free, perpetual, fully transferable license to use such Technical Information and right to practice such Technical Information for any manufacturing purpose, provided, however, RSM may not use any Technical Information to manufacture, alone or with a third party, a Galacto-oligosaccharides product of a purity greater than 70%, or any pharmaceutical product containing Galacto-oligosaccharides of a purity of greater than 70% for itself or any party other than RITTER or its designees, except with RITTER’s prior written consent.
5.4 RSM shall file the first patent application regarding Technical Information (“Initial Patent Application”) on or before November 30, 2009. RSM agrees to make patent filings regarding Technical Information in any and all jurisdictions requested by RITTER within three (3) days after filing of the initial Patent Application, RSM will provide RITTER with a true and correct copy of such Initial Patent Application.
5.5 RSM shall provide Lo I ER monthly written reports related to any Technical information and new manufacturing processes of Improved GOS, including any and all changes or modifications to equipment, processes, instrumental improvements and systems used to make improved GOS for the use of obtaining and/or expanding patent protection (“Improved GOS Developments”). All Improved GOS Developments shall be transferred to RITTER for no additional consideration as part of the exclusive assignment of all Improved GOS FP in Section 5.2 of this CSCA. Notwithstanding the foregoing, RSM shall not make any changes to the Specifications or manufacturing process without the prior written consent of RITTER. RSM represents and warrants that the grant of rights by RSM to RITTER, and the manufacture of Improved GOS by RSM under this Agreement, does not and will not infringe any patent or other proprietary rights of any Third Party.
5.6 Except as necessary for RSM to perform its obligations under this Agreement, neither RSM nor any of its Affiliates, alone or with a third party shall manufacture, market or sell Improved GOS, or any Galacto-oligosaccharides that are more than seventy percent (70%) pure, or any prodrugs, enantiomers, salt forms, hydrates, stereo-isomers or racemates thereof, to any third party. RSM agrees that violation or threatened violation of this Section 5.7 will cause irreparable injury to RITTER, entitling RITTER to seek injunctive relief without the obligation to post bond, in addition to all legal remedies,
6. | REPRESENTATIONS AND WARRANTIES |
6.1 Representations and Warranties of Each Party. Each Party hereby represents and warrants to the other Party as follows:
(a) Such Party (i) is duly formed and in good standing under the laws of the jurisdiction of its formation, (ii) has the power and authority and the legal right to enter into this Agreement and perform its obligations hereunder, and (iii) has taken all necessary action on its
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Clinical Supply and Cooperation Agreement Between Ritter & RSM/Inalco
part required to authorize the execution and delivery of this Agreement and the performance of its obligations hereunder.
(b) Upon execution, this Agreement will have been duly executed and delivered on behalf of such Party and constitutes a legal, valid and binding obligation of such Party and is enforceable against it in accordance with its terms, subject to the effects of bankruptcy, insolvency or other similar laws of general application affecting the enforcement of creditor rights and judicial principles affecting the availability of specific performance and general principles of equity, whether enforceability is considered a proceeding at law or equity.
(c) All necessary consents, approvals and authorizations of all Regulatory Authorities and other Persons required to be obtained by such Party in connection with the execution and delivery of this Agreement and the performance of its obligations hereunder have been obtained, including, without limitation, any and approvals of applicable Regulatory Authorities for the Facility.
(d) The execution and delivery of this Agreement and the performance of such Party’s obligations hereunder (i\ do not and will not conflict with or violate any requirement of law or any provision of the articles of incorporation, bylaws or limited partnership agreement of such Party and (ii) do not and will not conflict with, violate, or breach, or constitute a default or require any consent under, any contractual obligation or court or administrative order by which such Party is hound.
6.2 Additional Representations, Warranties and Covenants of RSM. RSM warrants, represents and covenants that for each Work Order RSM agrees to that:
(a) it has facilities, personnel, experience and expertise sufficient in quality and quantity to perform the obligations hereunder;
(b) as of the Effective Date, it has access to sufficient supplies of raw materials, components and other required resources to perform the manufacture and supply of Improved GOS, and shall exercise c:ommercially reasonable efforts to maintain access to sufficient supplies without interruption during the term of the CSCA;
(c) it has established quality assurance, quality controls and review procedures in place;
(d) it has at the Effective Date, and shall during the term of this CSCA, observe and comply, at its sole cost and expense, with all laws pertaining to the performance of manufacture and supply of Improved GOS under this CSCA; and
(e) neither RSM, nor any Affiliate, nor any officers, directors, consultants or employees have been excluded from participation in any government healthcare program, debarred or banned by the FDA or any other Regulatory Authority or voluntarily excluded from performing the activities contemplated by this CSCA or is under investigation by any Regulatory Authority in proceedings that could lead to debarment, exclusion or any such action in any country, and RSM shall notify RITTER immediately if such investigation, exclusion, debarment or ban occurs,
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Clinical Supply and Cooperation Agreement Between Ritter & RSM/Inalco
7. | MONTHLY FEE AND EQUIPMENT REIMBURSEMENT |
7.1 In addition to the amounts stated in Section 3 of this CSCA in consideration for the services provided by RSM under this CSCA and in support of submissions to Regulatory Authorities by RITTER regarding the clinical testing and marketing authorization for Improved GOS (“Regulatory Support”), RITTER shall pay to RSM a monthly fee or USD 7,000 (seven thousand) Monthly Fee”). Payment of the Monthly Fee shall be made by RITTER in USD.
7.2 The Monthly Fee will be paid by RITTER beginning 30 (thirty) days after the receipt by RITTER of the round of financing following the Effective Date in the amount of USD 10,000,000 (ten million) (“Financing Receipt”). All payment monthly fees will be made by RITTER on or before the 25 th day of each calendar month during the term of the Proposed Agreement.
7.3 RITTER shall immediately stop paying the Monthly Fee: (a) when, according to both Parties’ consent, which consent shall not be unreasonably withheld RSM Regulatory Support is no longer required; or (b) in the event of termination of this CSCA; and, thereafter, RITTER shall have no obligation to pay RSM any additional Monthly Fees.
7.4 No later than 30 (thirty) days following the Financing Receipt, RITTER will reimburse RSM for the reasonable costs actually incurred by RSM to purchase the HPLC Dyonics equipment (“Equipment”) required to perform the analysis methods for Improved GOS for FDA approval of RITTER Product; which reimbursement shall not exceed USD 60,000 (sixty thousand). Payment shall be made by RITTER in USD. RITTER will own the Equipment upon payment. The Equipment shall be delivered to RITTER within thirty (30) days following termination of this CSCA for any reason. During the period that the Equipment is in the possession and control of RSM, RSM shall use commercially reasonable efforts to maintain and care for the Equipment, and shall be responsible for all risk of damage and loss of the Equipment.
8. | PROPOSED AGREEMENT |
8.1 The Parties intend to enter into the Proposed Agreement the purpose of which is to clarify future manufacturing services to be provided by RSM to RITTER regarding Improved GOS and payment by RITTER to RSM for such future manufacturing services. For clarity, if RITTER is unable to obtain the Financing Receipt prior to the expiration of this CSCA, RITTER shall have no obligation to: (i) enter into the Proposed Agreement; and (ii) be responsible for Sections 3.2, 5 and 7.
8.2 The Parties agree that the following terms and conditions will be made part of the Proposed Agreement, and are binding upon the Parties as of the effective date of this CSCA:
(a) RITTER hereby appoints RSM to exclusively manufacture Improved GOS for use in RITTER Product that is approved for commercial sale in the Territory.
(b) RSM hereby accepts appointment, and agrees to manufacture and supply to RITTER all Improved GOS ordered by RITTER for use in RATER Product that is approved for commercial sale in the Territory.
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Clinical Supply and Cooperation Agreement Between Ritter & RSM/Inalco
(c) RITTER shall pay RSM a commercially reasonable price to purchase Improved GOS from RSM for use in RITTER Product approved for commercial sale in the Territory, which price shall in no event exceed Euros 20 (“Purchase Price”) per kilo of Improved GOS, delivered by RSM to, and accepted by RITTER. The Parties shall agree to a reasonable decrease in the Purchase Price in the event of a decrease in the costs of the manufacturing process and/or raw materials for Improved COS_
(d) In the event RITTER receives approval from the FDA to market commercially RITTER Product for the treatment of lactose intolerance in humans, RITTER shall pay RSM the following milestone payments:
(i) | USD 250,000 (two hundred-fifty thousand) upon the sale of the 2 (two) millionth “Unit” of Improved GOS by RITTER; |
(ii) | USD 500,000 (live hundred thousand) upon the sale of the 5 (five) millionth “Unit” of Improved GOS by RITTER; |
(iii) | USD 1,000,000 (one million) upon the sale of the 10 (ten) millionth “Unit” of Improved GOS by RITTER; and |
(iv) | USD 0,05, upon the sale of each “Unit” of Improved GOS by RITTER, over ten millionth. |
Payments will be made by RITTER within 90 (ninety) days of the “Unit” sold achievements. “Unit” is defined as the purchase of one product (otherwise known as one complete treatment) of Improved GOS by a single patient. The Parties agree that the payments stated in this Section 8(d) shall be made by RITTER only for the first RITTER Product containing Improved GOS approved by the FDA and sold in the United States of America for the treatment of lactose intolerance in humans. In the event that RITTER fails to receive FDA marketing authorization for any Fun ER Product, no milestone payments shall be owed under this Section 8.2(d).
(e) The Parties will agree in the Proposed Agreement on commercially reasonable milestones payments that may be paid to RSM by RITTER upon the sale of any additional RITTER Product containing Improved GOS approved by the FDA and sold in the United States of America, different from the one provided for in Section 8.2 lett. d.
(f) In the event RSM: (i) is unable to, or for any reason does not, manufacture Improved GOS to RITTER’S reasonable requirements including, but not limited to, timing, quantities and/or specifications; and/or (ii) RSM materially breach n any clauses of the Proposed Agreement and/or CSCA, RITTER shall provide RSM with written notice and RSM shall have 90 (ninety) days to cure such breach. If RSM fails to so cure the breach, RITTER may appoint a third party manufacturer to manufacture Improved GOS in full or partially, and/or may terminate the Proposed Agreement and/or CSCA. RITTER will give first consideration to appointing GLT Srl, which is one of Inalco’s Group Affiliates, as such third-party manufacturer, provided the terms for manufacture of Improved GOS by GLT are substantially similar to the terms stated in the Proposed Agreement, including the specifications for Improved GOS stated therein, and are otherwise commercially reasonable. RSM will provide all reasonable assistance in transitioning the manufacture of Improved GOS to such third party manufacturer,
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Clinical Supply and Cooperation Agreement Between Ritter & RSM/Inalco
(g) For the avoidance of doubt, notwithstanding any obligation to purchase Improved GOS from RSM under the CSCA, after FDA approval, RITTER will have the right to engage a second source supplier for the manufacture arid supply of Improved GOS, in those events provided above under Section 8.2, lett. f).the name of which Should he agreed In advance upon between the Parties, which agreement shall not be unreasonably withheld.
(h) The Proposed Agreement shall terminate upon the expiration of the first patent filed by RSM regarding Improved GOS.
8.3 The Parties expressly undertake to meet within one year after the Effective Date in order to finalize the terms of the Proposed Agreement. The Proposed Agreement shall include provisions regarding commercial manufacture and supply of Improved GOS, representations and warranties, indemnification, insurance, record retention, audit, inspection, assignment and other commercially reasonable provisions standard in the pharmaceutical industry for agreements of this nature.
8.4 In the event that the Parties are unable to agree upon the terms of the Proposed Agreement, the Parties will submit their disagreement to binding arbitration for final resolution of the terms of the Proposed Agreement. The arbitration will be conducted under the international rules of the American Arbitration Association, shall take place in Wilmington, Delaware, USA, and shall be conducted in the English language.
9. | TERM AND TERMINATION |
9.1 This CSCA shall be effective as of [25] November, 2009 (“Effective Date”), and shall endure for the term of validity the patents on Improved GOS (the “Term”) and terminated in the manner stated in Sections 9.2 and 9.3. The Parties may extend the Term of this CSCA by a written amendment signed by an authorized representative of each Party.
9.2 The Parties, by common consent, may terminate this CSCA by subsequent written agreement signed by authorized representatives of each Party.
9.3 RITTER may terminate this CSCA upon 30 (thirty) days prior written notice to RSM in the event that: (a) clinical testing of RITTER Product in the Territory is terminated by RITTER for any reason; or (b) RITTER does not obtain the Financing Receipt.
9.4 The Parties’ respective rights and obligations under this Agreement, which by their language are intended to extend beyond the term of the Agreement, shall survive termination of this Agreement. Sections 1.2, 2.7(a), 2.11, 3.3, 3.5, 4, 5.1, 6, 8.2 lett. b) –iv) 10-13, and 16 shall survive termination, relinquishment or expiration of this Agreement.
10. | INDEMNIFICATION |
10.1 RITTER will indemnify, defend, and hold harmless RSM and its directors, officers, employees, agents, successors and assigns from and against all liabilities, expenses and costs (including reasonable attorneys’ fees and court costs) arising out of any claim, complaint, suit, proceeding or cause of action against any of them by a third party to the extent resulting from (a) marketing, sale or use by or under authority of RITTER or its Affiliates of a RITTER Product
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Clinical Supply and Cooperation Agreement Between Ritter & RSM/Inalco
supplied by RSM to RITTER pursuant to and in accordance with this Agreement; (b) any breach by RITTER or its representations and warranties in this CSCA; or (c) the gross negligence or wilful misconduct of RITTER; in each case, subject to the requirements set forth in Section 11.3. Notwithstanding, and without limiting, the foregoing, RITTER will have no obligations under this Section 11.1 for any liabilities, expenses or costs to the extent arising out of or relating to claims covered under Section 11.2
10.2 RSM will indemnify, defend and hold harmless RITTER and its directors, officers, employees, agents, successors and assigns from and against all liabilities, expenses and costs (including reasonable attorneys’ fees and court costs) arising out of any claim, complaint, suit, proceeding or cause of action against any of them by a third party to the extent resulting from: (a) RSM’s activities performed pursuant to this Agreement; (b) failure of Improved GOS delivered hereunder to meet the applicable Specifications; (c) the gross negligence or wilful misconduct of RSM; (d) any breach by RSM of its representations or warranties in this CSCA; or (e) any material breach by RSM of its obligations under this Agreement; in each case, subject to the requirements set forth in Section 11.3. Notwithstanding the foregoing, RSM will have no obligations under this Section 11.2 for any liabilities, expenses or costs to the extent arising out of or relating to claims covered under Section 11.1.
10.3 Indemnification Procedure. A Party that intends to claim indemnification under this Article 11 (the “Indemnitee”) will promptly notify the indemnifying party (the “Indemnitor”) in writing of any third party claim, suit or proceeding included within the indemnification described in this Article 11 (each a “Claim”) with respect to which the Indemnitee intends to claim such indemnification, and the Indemnitor will have sole control of the defense and settlement of such Claim. The Indemnitor will not enter into any settlement of such Chum that admits fault, wrongdoing or damages without the Indemnitee’s prior written consent, which consent will not to be unreasonably withheld or delayed. The Indemnitee will have the right to participate, at its own expense, with counsel of its own choosing in the defense or settlement of such Claim. The indemnification under this Article 11 will riot apply to amounts paid in settlement of any Claim if such settlement is effected without the prior written consent: of the Indemnitor. The Indemnitee under this Article 11, and its employees, at the Indemnitor’s request and expense, will provide full information and reasonable assistance to the Indemnitor and its legal representatives with respect to Claims.
11. | GOVERNING LAW AND JURISDICTION |
This CSCA shall be governed by and construed in accordance with the material laws of the state of Delaware, United States of America, without regard to application of principles of conflicts of laws. All disputes arising out of or in relation with the present Agreement, concerning the validity, the interpretation and execution and its fulfilment shall be finally settled before a court of competent jurisdiction in Wilmington, Delaware, United States of America and coach Party consents to jurisdiction and venue of such court. This section shall survive termination of the CSCA.
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Clinical Supply and Cooperation Agreement Between Ritter & RSM/Inalco
12. | ASSIGNMENT |
RSM may not assign this CSCA without the prior written consent of RITTER. In the event RITTER should enter into an agreement with a third party for the development, sale or distribution of improved GOS and/or RITTER Product, or for the merger or acquisition of RITTER, the undertakings, rights and obligations provided In this CSCA shall extend and apply to such a third party, and may be assigned by RITTER to such third party.
13. | NOTICES |
All notices or communications hereunder shall be by registered mail or fax at the following address:
RITTER :
RITTER Pharmaceuticals, Inc.
Mr. Andrew J. Ritter
10100 Santa Monica Blvd.
#2430, Los Angeles, CA 90067
Phone: | 310-203-1000 |
Fax: | 310-919-1600 |
RSM/Inalco :
RSM S.p.A.
Mr. Giovanni Cipolletti
Via Ciabiana no. 18
Phone: | 0039 02 55213005 |
Fax: | 0039 02 55213277 |
14. | INDEPENDENT CONTRACTOR |
The Parties to this Agreement are independent contractors. Nothing contained in this Agreement: shall be construed to place the Parties in the relationship of employer and employee, partners, principal and agent or a joint venture. Neither Party shall have the power to bind or obligate the other Party nor shall either Party hold itself out as having such authority.
15. | ENTIRE AGREEMENT |
This Agreement and the Exhibits attached hereto constitute the final, complete and exclusive agreement between the Parties relating to the subject matter hereof and supersede all prior conversations, understandings, promises and agreements relating to the subject matter hereof.
16. | AMENDMENT; MODIFICATION |
This Agreement may not be amended, modified, altered or supplemented except by a writing signed by both Parties. No modification of any nature to this Agreement and no representation,
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Clinical Supply and Cooperation Agreement Between Ritter & RSM/Inalco
agreement, arrangement or other communication shall be binding on the Parties unless such is expressly contained in writing and executed by the Parties as an amendment to this Agreement.
17. | COUNTERPARTS |
This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original but all of which together shall constitute one and the same instrument.
IN WITNESS WHEREOF , the Parties have executed this Agreement as of the Effective Date.
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Clinical Supply and Cooperation Agreement Between Ritter & RSM/Inalco
Signature
Date and Place: Nov. 30, 2009 | |
RITTER Pharmaceuticals, Inc. | |
Mr. Andrew J. Ritter | |
(in his capacity as President and Managing Director) | |
/s/ Andrew J. Ritter | |
Date and Place: Dec. 15, 2009 | |
Ricerche Sperimentali Montale SpA | |
Mr. Marco Manoni | |
(in his capacity as Managing Director) | |
/s/ Marco Manoni | |
Date and place: Dec. 16, 2000 | |
Inalco SpA | |
Mr. Giovanni Cipolletti | |
(in his capacity as President and Managing Director) | |
/s/ Giovanni Cipolletti |
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Exhibit 10.31
AMENDMENT 1
To the Clinical Supply and Cooperation Agreement (hereinafter “CSCA”) entered into between:
Ritter Pharmaceuticals, Inc. , a Delaware corporation, with registered offices at 1880 Century Park East #1100, Los Angeles, CA 90067, (hereinafter “Ritter”)
And
Ricerche Sperimentali Montale SpA , with sole shareholder, an Italian company, having its operational offices at Montale (PT), via Garibaldi no. 33, and administrative offices in Milan, Italy, at via Calabiana no. 18 (hereinafter “RSM”)
And
Inalco SpA , with sole shareholder, an Italian company, having its registered offices in Milan, Italy, at via Calabiana no. 18 (hereinafter “Inalco”)
Collectively referred to as the “Parties” and each, individually, as a “Party”.
The term RSM shall include Inalco, and all references to RSM shall be deemed to include Inalco.
Whereas
A. | Section 16 of the CSCA requires all amendments to said agreement to be made in writing; |
B. | Pursuant to Section 2.3(b) of the CSCA, Ritter is required to pay RSM the amount of USD 25,000 in relation to the completion of the DMF submission to the FDA and RSM desires to set a fixed term for such payment to be made; |
C. | Ritter is entering into clinical phases for its product and desires to further define the terms and conditions of supply of Improved GOS contained in Section 3 of the CSCA to ensure adequate and timely delivery essential for the purpose of completing such clinical phases. |
Now, therefore, the Parties agree as follows:
1. | Upon execution of this agreement by the Parties, Ritter shall make full payment of the USD 25,000 due to RSM under Section 2.3(b) of the CSCA by wire transfer to the account indicated by RSM. As confirmation of date of payment, Ritter shall provide RSM a copy by email or fax of the wire transfer receipt (the “DMF Payment”). |
2. | Section 3.2 of the CSCA shall be amended in its entirety as follows: “Upon receipt of confirmation by Ritter of the DMF Payment, RSM shall supply Ritter 50 (fifty) kilos of Improved GOS at the price of USD 100,000 (one-hundred thousand) on the following delivery and payment terms: |
a. | Upon receipt of the email or fax confirming the DMF Payment, RSM shall immediately ship to Ritter 15 (fifteen) kilos of Improved GOS by UPS/Fedex and provide Ritter copies of relevant shipping documents indicating date of shipment and quality analysis certificate(s); |
b. | Upon receipt by Ritter of the shipping documents and quality analysis certificate(s) indicated in point a. above, Ritter shall make an advance payment of USD 25,000 (twenty-five thousand) by wire transfer to RSM; |
c. | By and no later than 60 (sixty) calendar days from the date of the DMF Payment, RSM shall deliver to Ritter 35 (thirty-five) kilos of Improved GOS by UPS/Fedex and provide Ritter copies of relevant shipping documents indicating date of shipment and quality analysis certificate(s); |
d. | The balance of USD 75,000 (seventy-five thousand) shall be due and payable to RSM upon receipt by Ritter of the shipping documents and quality analysis certificate(s) indicated in point c. above. |
3. | All other terms and conditions of the CSCA not specifically modified herein shall remain unaffected. |
4. | This Amendment 1 to the CSCA may be executed in one or more counterparts, each of which shall be deemed to be an original and all of which together shall constitute one and the same instrument. |
In Witness Whereof, the Parties have executed this Amendment 1 to the CSCA as of the first date written below.
Date: | Sept. 25, 2010 |
Ritter Pharmaceuticals, Inc.
Mr. Andrew J. Ritter
(in his capacity as President and Managing Director
/s/ Andrew J. Ritter |
Date: | Sept. 26, 2010 |
Ricerche Sperimentali Montale SpA
Mr. Marco Manoni
(in his capacity as Managing Director)
/s/ Marco Manoni |
Date: | Sept. 26, 2010 |
Inalco SpA
Mr. Giovanni Cipoletti
(in his capacity as President and Managing Director)
/s/ Giovanni Cipoletti |
- 2 - |
Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
As independent registered public accountants, we hereby consent to the use in this Registration Statement on Form S-1/A and related Prospectus of our report dated March 13, 2015 (except for the matters noted in Note 11, as to which the date is April 24, 2015, and except for the effects of the stock split as described in Note 2 and Note 3, as to which the date is April __, 2015) relating to the financial statements of Ritter Pharmaceuticals, Inc, (which report includes an explanatory paragraph relating to the uncertainty of the Company’s ability to continue as a going concern) and to the reference to us under the caption "Experts" which is contained in this Prospectus.
The foregoing consent is in the form that will be signed upon the completion of the reverse stock split described in Note 2 and Note 3 to the financial statements.
/s/ Mayer Hoffman McCann P.C.
Orange County, California
April 24, 2015