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Source: CNS PHARMACEUTICALS, INC., 8-K, 3/26/2020
1.8 "Net Sales" shall be defined in the same way as defined in Sections 6.1 (a)-(f) of the Sublicense Agreement, as applicable only to the relevant Development Products less any "pass-thru royalties" or "override royalty percentage" paid by WPD pursuant to the Sublicense Agreement. 1.9 "Phase II Milestone Payment" means the completion by WPD of a Phase II Study in one of the countries included within the Development Territory, which clinical trial meets all endpoints and is sufficient to form the basis of an application for approval of a Development Product in one Development Territory other than Poland. 1.10 "Sale", "Sells", "Sold" means the transfer or disposition of a Development Product, for value, to a person or entity for end use. ARTICLE 2 DEVELOPMENT AGREEMENT 2.1 Subject to the terms and conditions of this Agreement, WPD hereby agrees to use its commercially reasonable efforts in good faith to take, or cause to be taken, all actions, and to do or cause to be done, all things necessary, proper or desirable or advisable under applicable laws to develop and commercialize the Development Products, with a goal of eventual approval of Development Products in the Development Territory. In exchange for the payment by WPD of the Development Fee to CNS, CNS hereby agrees to pay WPD the following payments: (i) within thirty Business Days from the date of this Agreement, CNS will make an upfront payment of $225,000 to WPD; and (ii) within thirty days of the verified achievement of the Phase II Milestone, (such verification shall be conducted by an independent third party mutually acceptable to the parties hereto), CNS will make a payment of $775,000 to WPD. 2.2 If after three years from the Effective Date of this Development Agreement, WPD fails to use commercially reasonable efforts as set forth in section 2.1 above, CNS shall have the right to terminate this Agreement pursuant to the terms specified in Section 6.2 below, and CNS shall be entitled to the return of any payments made hereunder. For the purpose of this clause, if WPD has expended the funds provided by CNS pursuant to section 2.1 above on developing anti-viral indications (including all direct and indirect costs of such development), it will be deemed to have used commercially reasonable efforts in good faith. 2.3 The first Development Fees payment shall be due forty-five days after the end of the Calendar Quarter in which the first Sale of a Development Product took place. Thereafter, WPD shall furnish to CNS Development Fees no later than forty-five days after the end of each Calendar Quarter for the Sale of Development Products through the end of such Calendar Quarter and shall further furnish CNS with a written statement setting forth an accounting showing the calculation of the Development Fees. ARTICLE 3 INFORMATION AND USE 3.1 WPD shall furnish CNS with written reports summarizing the progress of the research and development conducted under the Sublicense Agreement related to the Development Products on a quarterly basis. 3.2 The Parties agree to a mutual exchange of any data, information or know-how resulting from the research and development of the Development Products. ARTICLE 4 OTHER COMPENSATION 4.1 If MBI exercises its right to terminate the Sublicense Agreement in whole, or to remove a portion of the sublicensed subject matter that relates to some or all of the Development Products, by paying to WPD the Buyback Consideration (as defined in the Sublicense Agreement), WPD agrees that CNS shall receive the greater of (i) 50% of the Buyback Consideration that is attributable to the field of anti-viral pharmaceutical drug products for humans (such attribution to be mutually agreed upon by the Parties), and (ii) the amounts actually provided to WPD pursuant to Section 2.1 of this Agreement.
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Source: CNS PHARMACEUTICALS, INC., 8-K, 3/26/2020