PATENT PURCHASEAGREEMENT

Purchase Price of Inventions and Patents.  The purchase price for the Inventions and Patents shall be:

4.

Taxes; Brokers.  Seller shall pay any taxes that are legally imposed on Seller arising out of the transfer of the Inventions and Patents.  Seller is not liable for any taxes, if any, that are legally imposed on Buyer arising out of the transfer of the Inventions and Patents.  Seller is responsible for any fees (including legal and broker fees) incurred by Seller and Buyer is responsible for any fees (including legal and broker fees) incurred by Buyer.

 

Corporate Organization.  Seller is a corporation duly organized, validly existing and in good standing under the laws of the State of Nevada, USA with full power and authority to own and operate its properties and assets and carry on its business as currently conducted.

 

Authorization.  Seller has full power and authority to enter into this Agreement and the Patent Assignment and to carry out the transactions contemplated hereby and thereby.  The execution and delivery of this Agreement and the Patent Assignment and the consummation of the transactions contemplated hereby and thereby have been duly authorized by the Board of Directors and all other necessary corporate actions on the part of Seller, including the shareholders, to the extent required.  This Agreement and the Patent Assignment have been duly executed and delivered by the Seller, and constitute legal, valid and binding obligations of Seller, enforceable in accordance with their terms.

 

Non-Contravention.  Neither the execution and delivery of this Agreement and the Patent Assignment, nor the assignment of the Inventions and the Patents contemplated hereby and thereby will violate, or be in conflict with the Articles of Incorporation of the Seller or any provision of any applicable law binding upon or applicable to the Seller, or any of the Inventions or Patents, give rise to any right of termination, cancellation, increase in obligations, imposition of fees or penalties under, any debt, note, bond, indenture, mortgage, lien, lease, license, instrument, contract, commitment or other agreement, or order, arbitration award, judgment or decree, to which Seller is a party or by which it is bound or to which the Inventions or Patents are subject, or result in the creation or imposition of any mortgage, lien, charge, pledge, security interest, other encumbrance or third party right (“Encumbrances”) upon any of the Inventions or Patents.

 

Approvals.  No consent, approval, order or authorization of, or registration, declaration or filing with, any governmental or regulatory authority or third party is required in connection with the execution or delivery of this Agreement or the Patent Assignment or the consummation of the transactions contemplated hereby and thereby, except for recordation of suitable patent assignment documents in the U.S. Patent & Trademark Office (the “PTO”) and comparable foreign patent offices (the “Required Approvals”).

 

Ownership of the Patents.  The Seller owns all right, title and interest, and has good and marketable title, in and to the Inventions and Patents free and clear of all Encumbrances.  Seller is not obligated or under any liability whatsoever to make any payments by way of royalties, fees or otherwise to any owner or licensee of, or other claimant with respect to the use of the subject matter disclosed and claimed in the Inventions or the Patents or in connection with the licensing of the Inventions and/or Patents to third parties.

 

Pre-Existing Licenses under the Patents.  The Seller, or any predecessor-in-interest to the Inventions and Patents, has not granted any licenses or any other rights under the Inventions or Patents.

 

Litigation.  There are no (i) actions, suits, claims, hearings, arbitrations, proceedings (public or private) or governmental investigations against or affecting the Seller, pending or threatened, against or by the Seller (collectively, “Proceedings”), nor any Proceedings or investigations or reviews by any governmental authority against or affecting the Seller, pending or threatened against or by the Seller, relating to the Inventions or Patents or which seek to enjoin or rescind the transactions contemplated by this Agreement or the Patent Assignment; or (ii) existing orders, judgments or decrees of any governmental authority naming the Seller as an affected party in connection with Inventions and/or the Patents.

 

Patent Maintenance.  All annuity and maintenance fees that are necessary in order to keep the Patents in force as of the Effective Date have been paid by Seller, and no payment of annuities or fees, or papers to be filed in patent offices, are required to be made within the three-month period after the Effective Date.

 

Without derogating from the provisions of Section 3 above, Seller agrees to defend, indemnify and hold the Indemnified Parties harmless from, against and in respect of any and all losses, liabilities, damages, claims or expenses (including, without limitation, attorneys' fees) suffered or incurred, directly or indirectly by the Indemnified Parties by reason of, or resulting from the breach of any representation or warranty contained in Section 6 of this Agreement or from the failure to perform any covenant contained in this Agreement or in the Patent Assignment.

 

Whenever any claim arises for indemnification under this Agreement or an event which may result in a claim for such indemnification has occurred, the Indemnified Party will promptly notify the Seller of the claim and, when known, the facts constituting the basis for such claim.  The Seller shall have the obligation to dispute and defend all such third party claims and thereafter so defend and pay any adverse final judgment or award or settlement amount in regard thereto. Such defense shall be controlled by the Seller, and the cost of such defense shall be borne by the Seller, provided that the Indemnified Parties shall have the right to participate in such defense at their own expense, unless the Indemnified Parties require their own attorney due to a conflict of interests, in which case, the expense thereof will be borne by the Seller. The Indemnified Parties shall cooperate in all reasonable respects in the investigation, trial and defense of any such claim at the cost of the Seller. If the Seller fails to take action within thirty (30) days of notice, then the Indemnified Parties shall have the right to pay, compromise or defend any third party claim, such costs to be borne by the Seller. The Indemnified Protected shall also have the right and upon delivery of ten (10) days advance written notice to such effect to the Seller, exercisable in good faith, to take such action as may be reasonably necessary to avoid a default prior to the assumption of the defense of the third party claim by the Seller, and any expenses incurred by the Indemnified Parties so acting shall be paid by the Seller. The Seller will not settle or compromise any third party claim without the prior written consent of the Indemnified Parties.

 

Seller represents that it has secured the inventor's cooperation in fulfilling the representations and obligations of Section 6.4.6.

 

Corporate Organization.  Buyer is a corporation duly organized, validly existing and in good standing under the laws of Germany, with full power and authority to own and operate its properties and assets and carry on its business as currently conducted.

 

Authorization.  Buyer has full power and authority to enter into this Agreement and to carry out the transactions contemplated hereby.  The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized by all necessary corporate actions on the part of Buyer.  This Agreement and the Patent Assignment have been duly executed and delivered by the Buyer, and constitute legal, valid and binding obligations of Buyer, enforceable in accordance with their terms.

 

Closing.  The Closing (the “Closing”) of the purchase and sale of the Patents shall take place on or before

.

 

Documents.  During the period prior to the Closing, the Seller will provide to Buyer complete copies of the patent prosecution files provided by prosecution counsel and any other documents (electronic or otherwise) in Seller's custody or control relating to the Inventions and the Patents.

 

Deliveries.  At the Closing, the Seller shall deliver to the Buyer the following:

 

duly executed copies of the Patent Assignment, duly executed by the Sellers;

 

such other duly executed agreements, deeds, certificates or other instruments of conveyance, transfer and assignment as shall be necessary, in the reasonable opinion of the Buyer, to vest in the Buyer good, valid and marketable title to the Inventions and the Patents.

 

Pre-Closing Transfer.  At least five (5) business days prior to the Closing (or immediately thereafter upon learning of the existence of any such files or documents that have not been transferred to Buyer subsequent to the transfer contemplated under this Section 8.4), Seller shall, and shall cause its patent counsel to deliver to Buyer (or to Buyer’s counsel as may be directed by Buyer) copies of all patents and patent applications, and PTO correspondence in Seller’s or Seller’s counsel’s possession related to the Patents and any other documents (electronic or otherwise) in Seller's custody or control relating to the Patents. Seller represents to Buyer that as of the date five business days prior to the Closing Date, Seller has conducted a thorough and diligent search through its counsel for all such documents, and that as of the Closing, no other such documents remain in the custody or control of Seller. Seller further agrees that upon the Effective Date all rights and privileges (including with respect to any attorney client privileges, attorney work product or any other professional privileges or rights) held by Seller or any third party, that arise from or relate to the Patents, Inventions or any other intellectual property transferred under this Agreement, shall be transferred from Seller to Buyer, including, without limitation, all documents and data that relate to Tapentadol.

Miscellaneous.  All notices and other communications hereunder shall be in writing and shall be deemed given if delivered (a) personally,  (b) by facsimile transmission, (c) by overnight courier or (d) by registered or certified mail (return receipt requested) to the parties at the following addresses (or at such other address for a Party as shall be specified by like notice);

Infringement. In the event that Seller or Buyer is named as a defendant in any patent infringement lawsuit brought as a result of Buyer’s efforts to market a product during the commercialization of the Patents, Seller shall fully cooperate with Buyer in the handling of all such claims or lawsuits, assist in production and location of evidence and provide other assistance as requested by Buyer, including assistance with discovery, depositions and expert testimony. Buyer shall have the obligation to undertake the control and defense of such Infringement Action, including the satisfaction of resulting legal fees and expenses, whether such action was brought against Seller or Buyer. Buyer shall be responsible for the coordination and payment of legal activities and shall promptly reimburse all costs incurred by the Seller. Buyer shall be solely responsible for, and hereby agrees to indemnify and hold harmless Seller and its affiliates against, damages, claims, penalties, all legal fees and related expenses incurred by the Buyer in the satisfaction of its obligations.

11.

General Provisions. The Agreement is governed by the following general provisions;

 

Entire Agreement.  This Agreement (including the Exhibits) and the Patent Assignment constitute the entire agreement of the parties and supersedes all other prior or contemporaneous agreements and understandings, both written and oral, among or between the parties with respect to the subject matter hereof.

 

Assignment.  The Parties may assign this agreement including all the rights and obligations hereunder upon the provision of written notice to the other Party.  It is hereby clarified that a “change in control” transaction of the Parties shall not be deemed to be an assignment of this Agreement by the Party.

 

Governing Law; Forum.  This Agreement will be governed by and construed in accordance with the laws of the United States and the State of New Jersey without regard to principles of conflicts of law.  Each party hereby agrees to jurisdiction and venue in the courts of the State of New Jersey or the Federal courts sitting therein for all disputes and litigation arising under or relating to this Agreement.

 

Counterparts.  This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same agreement.

 

Headings.  The headings of the articles and sections of this Agreement are inserted for convenience only and shall not constitute a part hereof.

 

Confidentiality.  The contents of this Agreement, including its terms and conditions, are considered confidential.  Neither Party shall disclose the terms of the Agreement to an unaffiliated third party without the prior written approval of the other Party, except to legal, financial, accounting or other similar advisors who agree to maintain the terms of this Agreement confidential, or except for any requisite filings to be made with the Securities and Exchange Commission.  In the event an unaffiliated third party seeks to discover the terms of this Agreement through a court order, the Party to whom the request for the terms has been made shall provide reasonable notice of the request to the other Party to this Agreement and shall use its reasonable efforts to prevent at least the disclosure of the terms of the Agreement.  Neither Party will originate any publicity, news release, or other announcement, written or oral, whether to the public press, to stockholders, or otherwise, relating to this Agreement, to any amendment hereto or to performance hereunder or the existence of an arrangement between the parties without the prior written approval of the other Party.

 

Independent Contractors. The relationship of Seller and Buyer established by this Agreement is that of independent contractors, and nothing contained in this Agreement shall be construed (i) to give either party the power to direct or control the day-to-day activities of the other, or (ii) to constitute the parties as partners, participants in a joint venture, co-owners or otherwise as participants in a joint or common undertaking.

 

Further Assurances.  Seller agrees, at its sole expense, to execute such further documents and do any and all such reasonable things as may be necessary to implement and carry out the terms, conditions and intent of this Agreement within a commercially reasonable timeframe upon the request of Buyer.

 

Interpretation. The parties agree that this Agreement shall be fairly interpreted in accordance with its terms without any strict construction in favor of or against either party and that ambiguities shall not be interpreted against the drafting party.

 

Severability. If for any reason a court of competent jurisdiction finds any provision of this Agreement, or portion thereof, to be unenforceable, that provision of the Agreement will be enforced to the maximum extent permissible so as to affect the intent of the parties, and the remainder of this Agreement will continue in full force and effect.

 

Disclaimers. This Agreement does not confer by implication, estoppel, laches or by any other means any license or any right other than those expressly granted herein.

 

Injunctive Relief. The parties agree that a material default of the provisions of this Agreement by a party hereto could cause irreparable injury to the other party for which monetary damages would not be an adequate remedy and such other party shall be entitled to seek equitable relief, including injunctive relief and specific performance, in addition to any remedies it may have hereunder or at law.

 

Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be an original and all of which shall constitute together the same document.  It is further agreed that the delivery by facsimile, e-mail or other recognized electronic medium of an executed counterpart of this Agreement will be deemed to be an original and will have the full force and effect of an original executed copy.

1.  

Assignor hereby sells, transfers, assigns and sets over to Assignee all rights, title and interest (for all countries) in and to the Patents, and all the rights and privileges under any letters patent that may be granted under any continuations, divisions, reissues, reexaminations, renewals and extensions therefore and thereon and all continuations, divisions, reissues, reexaminations, renewals and extensions thereof; and all applications for industrial property protection, including without limitation, all applications for patents, utility models, copyright, and designs which may hereafter be filed for said Inventions and Patents in any country or countries, together with the right to file such applications and the right to claim for the same the priority rights derived from the Patents under the patent laws of the United States, the International Convention for the Protection of Industrial Property, or any other international agreement or the domestic laws of the country in which any such application is filed, as may be applicable; and all applications for industrial property protection, including, without limitation, all applications for patents, utility models, copyrights and designs which may hereafter be filed for said Inventions or Patents in any country or countries, together with the right to file such applications; and all forms of industrial property protection, including, without limitation, patents, utility models, inventors’ certificates, copyrights and designs which may be granted for said Patent in any country or countries and all extensions, renewals and reissues thereof.

2.  

Assignor hereby authorizes and requests the Commissioner of Patents and Trademarks of the United States and any official of any country or countries foreign to the United States, whose duty is to issue patents or other evidence or forms of industrial property on applications as aforesaid, to issue the same to Assignee, it successors, assigns and legal representatives, or to such nominees as it may designate.

3.  

Assignor agrees that, whenever reasonably requested by Assignee and at Assignee’s expense, Assignor will execute all papers, take all rightful oaths, and do all acts which may be reasonably necessary for securing and maintaining patents for the Inventions in any country and for vesting title thereto in Assignee, its successors, assigns and legal representatives or nominees.

4.  

Assignor authorizes and empowers Assignee, its successors, assigns and legal representatives or nominees, to invoke and claim for any application for patent or other form of protection for the Inventions, the benefit of the right of priority provided by the International Convention for the Protection of Industrial Property, as amended, or by any convention which may henceforth be substituted for it, or any other international agreement or the domestic laws of the country in which any such application is filed, as may be applicable, and to invoke and claim such right of priority without further written or oral authorization from Assignor.

5.  

Assignor hereby consents that a copy of this Agreement shall be deemed a full legal and formal equivalent of any assignment, consent to file or like document that may be required in any country for any purpose and more particularly in proof of the right of Assignee or nominee to claim the aforesaid benefit of the right of priority provided by the International Convention for the Protection of Industrial Property, as amended, or by any convention which may henceforth be substituted for it.

6.  

All of the rights, title and interest in and to the Patents sold, transferred, assigned and set over to Assignee hereunder include all income, royalties, damages and payments now or hereafter due or payable with respect thereto, and all causes of action (whether in law or equity) and the right to sue, counterclaim, and recover for the past, present and future infringement of the rights assigned or to be assigned hereunder.