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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 3, 1997
REGISTRATION NO. 333-31109
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
AMENDMENT NO. 4
TO
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
TRIMERIS, INC.
(Exact name of registrant as specified in its charter)
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DELAWARE 8733 56-1808663
(State or other jurisdiction (Primary Standard (I.R.S. Employer
of incorporation or Organization) Industrial Code Number) Identification No.)
</TABLE>
4727 UNIVERSITY DRIVE, SUITE 100
DURHAM, NORTH CAROLINA 27707
(919) 419-6050
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
------------------------
DR. M. ROSS JOHNSON
PRESIDENT, CHIEF EXECUTIVE OFFICER
AND CHIEF SCIENTIFIC OFFICER
4727 UNIVERSITY DRIVE, SUITE 100
DURHAM, NORTH CAROLINA 27707
(919) 419-6050
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
COPIES TO:
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COUNSEL TO COMPANY COUNSEL TO UNDERWRITERS
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FRED D. HUTCHISON, ESQUIRE JOHN B. WATKINS, ESQUIRE ALEXANDER D. LYNCH, ESQUIRE
HUTCHISON & MASON PLLC WILMER, CUTLER & PICKERING BROBECK, PHLEGER & HARRISON LLP
4011 WESTCHASE BOULEVARD 2445 M ST., N.W. 1633 BROADWAY
SUITE 400 WASHINGTON, D.C. 20037 47TH FLOOR
RALEIGH, NORTH CAROLINA 27607 (202) 663-6000 NEW YORK, NEW YORK 10019
(919) 829-9600 (212) 581-1600
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO PUBLIC:
As soon as practicable after this Registration Statement becomes effective.
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. [ ]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(b)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933, OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the expenses to be paid by Trimeris, Inc.
(the "Registrant" or the "Company") in connection with the issuance and
distribution of the securities being registered hereby other than underwriting
discounts and commissions.
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Registration Fee -- Securities and Exchange Commission.................................................. $ 12,197
Filing Fee -- National Association of Securities Dealers, Inc........................................... 4,525
Filing and Listing Fee -- Nasdaq National Market........................................................ 42,177
Transfer Agent's Fee and Expenses*...................................................................... 5,000
Legal Fees and Expenses*................................................................................ 325,000
Printing and Engraving Expenses*........................................................................ 175,000
Accounting Fees and Expenses*........................................................................... 150,000
Blue Sky Fees and Expenses (including legal fees)*...................................................... 15,000
Miscellaneous*.......................................................................................... 71,101
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Total............................................................................................ $800,000
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* Estimated
ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the Delaware General Corporation Law (the "DGCL") permits
indemnification of officers and directors of the Company under certain
conditions and subject to certain limitations. Section 145 of the DGCL also
provides that a corporation has the power to purchase and maintain insurance on
behalf of its officers and directors against any liability asserted against such
person and incurred by him and her in such capacity, or arising out of his or
her status as such, whether or not the corporation would have the power to
indemnify him or her against such liability under the provisions of Section 145
of the DGCL.
The Company's Third Amended and Restated Certificate of Incorporation to be
filed upon the completion of this Offering contains certain provisions permitted
under DGCL relating to the liability of directors. These provisions eliminate a
director's personal liability for monetary damages resulting from a breach of
fiduciary duty, except in certain circumstances involving certain wrongful acts,
such as (i) for any breach of the director's duty of loyalty to the Company or
its stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) under Section 174 of
the DGCL, (iv) for any transaction from which the director derives an improper
personal benefit or (v) acts or omissions occurring prior to the date of these
provisions. These provisions do not limit or eliminate the rights of the Company
or any stockholder to seek equitable relief, such as an injunction or
rescission, in the event of a breach of director's fiduciary duty. These
provisions will not alter a director's liability under federal securities laws.
The Company's Third Amended and Restated Certificate of Incorporation also
contains provisions indemnifying the directors and officers of the Company to
the fullest extent permitted by DGCL.
The Amended and Restated Bylaws of the Company to be effective upon the
completion of this Offering provide that the Company shall indemnify its
directors and executive officers to the fullest extent permitted by the DGCL.
The rights to indemnity thereunder continue as to a person who has ceased to be
a director, officer, employee or agent and inure to the benefit of the heirs,
executors and administrators of the person. In addition, expenses incurred by a
director or officer in defending any civil, criminal, administrative or
investigative action, suit or proceeding by reason of the fact that he or she is
or was a director or officer of the Company (or was serving at the Company's
request as a director or officer of another corporation) shall be paid by the
Company in advance of the final disposition of such action, suit or proceeding
upon receipt of an undertaking by or on behalf of such director or officer to
repay such amount if it shall ultimately be determined that he or she is not
entitled to be indemnified by the Company as authorized by the relevant section
of the DGCL.
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The Company has entered into indemnification agreements with each of its
directors and executive officers prior to the completion of the Offering.
Generally, the indemnification agreements will provide the maximum protection
available under the Third Amended and Restated Certificate of Incorporation, the
Amended and Restated Bylaws and the DGCL as it may be amended from time to time.
Under such indemnification agreements, however, an individual will not receive
indemnification for judgments, settlements or expenses if he or she is found
liable to the Company (except to the extent the court determines he or she is
fairly and reasonably entitled to indemnity for expenses), for settlements not
approved by the Company or for settlements and expenses if the settlement is not
approved by the court. The indemnification agreements provide for the Company to
advance to the individual any and all expenses (including attorneys' fees)
incurred in investigating or defending any such action, suit or proceeding.
Also, the individual must repay such advances upon a final judicial decision
that he or she is not entitled to indemnification.
The Underwriting Agreement (filed as Exhibit 1.1 to this Registration
Statement) contains provisions by which the Underwriters have agreed, severally
and not jointly, to indemnify and hold harmless the Company, each person, if
any, who controls the Company, within the meaning of Section 15 of the
Securities Act, each director of the Company, and each officer of the Company
who signs this Registration Statement, from and against any liability caused by
any information furnished in writing by the Underwriters for use in the
Registration Statement.
ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES
Except as hereinafter set forth, there have been no securities sold by the
Registrant within the last three years which were not registered under the
Securities Act of 1933, as amended (the "Securities Act"). Common Stock amounts
and prices in this Item 15 have been adjusted to reflect the 1-for-8.5 reverse
stock split of the Registrant effected on July 11, 1997.
(a) Issuances of Securities
On July 1, 1997, the Registrant issued 10,589 shares of Common Stock
to a key employee of the Registrant at a purchase price of $.43 per share.
On June 27, 1997, the Registrant issued 9,047,962 shares of Series D
Preferred Stock to certain existing stockholders and new investors at a
purchase price of $.75 per share.
On June 11, 1997, the Registrant issued an aggregate of 117,648 shares
of Common Stock to certain executive officers and key employees of the
Registrant at a purchase price of $.43 per share payable pursuant to the
terms of certain promissory notes.
On June 2, 1997, the Registrant issued an aggregate of 219,295 shares
of Common Stock to certain executive officers and key employees of the
Registrant at a purchase price of $.43 per share payable pursuant to the
terms of certain promissory notes.
In a series of closings held on October 7, 1996, January 16, 1997,
March 27, 1997 and April 29, 1997, the Registrant issued an aggregate of
13,317,739 shares of Series C Preferred Stock to certain existing
stockholders and new investors at a purchase price of $.60 per share.
On October 31, 1996, the Registrant issued an aggregate of 41,177
shares of Common Stock to certain executive officers and key employees of
the Registrant at a purchase price of $.34 per share payable pursuant to
the terms of certain promissory notes.
On June 25, 1996, the Registrant issued an aggregate of 14,118 shares
of Common Stock to a former executive officer of the Registrant at a
purchase price of $.34 per share.
On January 26, 1996, the Registrant issued an aggregate of 589 shares
of Common Stock to consultants of the Registrant at a purchase price of
$.43 per share.
On July 31, 1995, the Registrant issued a warrant to purchase up to an
aggregate of 100,000 shares of Series B Preferred Stock (which warrant has
been amended to provide for the purchase shares of Common Stock upon the
completion of this Offering) at an exercise price of $0.50 per share to
North Carolina Biotechnology Center.
II-2
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In a series of closings held on July 17, 1995, August 16, 1995, and
March 22, 1996, the Registrant issued an aggregate of 27,135,564 shares of
Series B Preferred Stock to existing stockholders and new investors at a
purchase price of $.50 per share.
On March 1, 1995, the Registrant issued an aggregate of 17,648 shares
of Common Stock to certain executive officers and key employees of the
Registrant at a purchase price of $.43 per share.
On February 21, 1995, the Registrant issued 5,883 shares of Common
Stock to an executive officer of the Registrant at a purchase price of $.43
per share.
On September 16, 1994, the Registrant sold 11,765 shares of Common
Stock to a former executive officer at a purchase price of $.43 per share.
In a series of transactions on August 24, 1993, October 26, 1994 and
February 7, 1995, the Registrant issued warrants to purchase an aggregate
of 381,808 shares of Series B Preferred Stock (which warrant has been
amended to provide for the purchase of shares of Common Stock upon the
completion of this Offering) at an exercise price of $.50 per share to its
venture leasing partner in consideration for certain leasing arrangements.
Since June 1994, the Registrant has issued options to certain
employees, directors, consultants and others to purchase an aggregate of
706,782 shares of Common Stock at a weighted average exercise price of $.44
per share. 357,634 of such options have been exercised, 265,562 of such
options remain outstanding at a weighted average exercise price of $.39 per
share and 83,586 of such options have been terminated.
(b) No underwriters were involved in connection with the sales of
securities referred to in paragraph (a) of this Item 15.
(c) The shares of Series B, Series C and Series D Preferred Stock described
in paragraph (a) of this Item 15 were issued in reliance on the exemption
provided by Rule 506 of Regulation D promulgated pursuant to the Securities Act,
as well as Section 4(2) of the Securities Act. The issuances of compensatory
stock awards, stock options and the shares of Common Stock upon the exercise
thereof as described in paragraph (a) of this Item 15 were issued in reliance
upon the exemption provided by Section 3(b) of the Securities Act and Rule 701
promulgated thereunder, as well as Section 4(2) of the Securities Act. The
warrants described in paragraph (a) of this Item 15 were issued upon reliance on
exemption provided by Section 4(2) of the Securities Act. Appropriate legends
are affixed to the stock certificates and warrant certificates issued in the
aforementioned transactions.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) Exhibits
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1.1 Form of Underwriting Agreement.
3.1 Second Restated Certificate of Incorporation of the Registrant.
3.2 Form of Third Amended and Restated Certificate of Incorporation of the Registrant (to be filed
with the Secretary of State of Delaware upon the completion of the Offering).
3.3 Bylaws of the Registrant.
3.4 Form of Amended and Restated Bylaws of the Registrant (to be adopted upon the completion of the
Offering).
4.1 Specimen certificate for shares of Common Stock.
4.2 Description of Capital Stock (contained in the Third Amended and Restated Certificate of
Incorporation of the Corporation of the Registrant, filed as Exhibit 3.2).
5.1 Opinion of Hutchison & Mason PLLC with respect to the legality of the shares being registered.
10.1 License Agreement dated February 3, 1993, between the Registrant and Duke University.
10.2 Sublease Agreement dated November 19, 1993, by and among the Registrant, Sphinx Pharmaceuticals
Corporation and University Place Associates and as amended by the Lease Amendment dated August
15, 1994, and Second Agreement of Sublease dated January 16, 1995.
10.3 Cooperation and Strategic Alliance Agreement dated April 21, 1997, between the Registrant and
MiniMed Inc.
10.4 Trimeris, Inc. Amended and Restated Stock Incentive Plan.
10.5 Trimeris, Inc. Employee Stock Purchase Plan.
10.6 Form of Promissory Notes executed by certain executive officers in favor of the Registrant, and
related collateral documents.
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II-3
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10.7 Form of Stock Restriction Agreements between the Registrant and certain executive officers.
10.8 Form of Stock Pledge Agreement between the Registrant and certain executive officers.
10.9 Employment Offer Letter with M. Ross Johnson dated December 15, 1994.
10.10 Employment Offer Letter with Matthew A. Megaro dated February 23, 1995.
10.11 Sixth Amended and Restated Registration Rights Agreement dated June 27, 1997, by and among the
Registrant and certain stockholders of the Registrant.
10.12 Agreement with Max N. Wallace dated July 10, 1997.
10.13 Form of Indemnification Agreements.
10.14** License Agreement dated September 9, 1997 between the Registrant and The New York Blood Center.
11.1 Computation of Net Income (Loss) Per Share.
23.1 Consent of Hutchison & Mason PLLC (included in Exhibit 5.1).
23.2 ** Consent of KPMG Peat Marwick, LLP, Independent Auditors.
23.3 ** Consent of Pennie & Edmonds.
24.1 Power of Attorney (included in signature page to Registration Statement).
27 Financial Data Schedule.
</TABLE>
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* To be filed by amendment.
** Filed herewith.
(b) Financial Statement Schedules.
All financial statement schedules have been omitted because either they are not
required, are not applicable, or the information is otherwise set forth in the
Financial Statements and Notes thereto.
ITEM 17. UNDERTAKINGS
The undersigned Registrant hereby undertakes to provide to the Underwriters
at the closing or closings specified in the Underwriting Agreement, certificates
in such denominations and registered in such names as required by the
Underwriters to permit promt delivery to each purchaser.
The undersigned Registrant hereby further undertakes that:
(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this registration statement in reliance upon Rule 430A and contained in
a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(b) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial BONA FIDE offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933, as amended, may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or otherwise,
the Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Securities Act of 1933, as amended, and is, therefore, unenforceable. In
the event that a claim for indemnification against such liabilities (other than
the payment by the Registrant of expenses incurred or paid by a director,
officer or controlling person of the Registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the Registrant will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act of 1933, as amended, and will be governed by the final
adjudication of such issue.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Durham,
County of Durham, State of North Carolina, on this 3rd day of October, 1997.
TRIMERIS, INC.
By: /s/ M. ROSS JOHNSON
----------------------------------
M. ROSS JOHNSON,
PRESIDENT, CHIEF EXECUTIVE OFFICER
AND CHIEF SCIENTIFIC OFFICER
WITNESS our hands on this 3rd day of October, 1997.
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/s/ JESSE I. TREU* /s/ ANDREW MCCREATH*
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Jesse I. Treu, Ph.D. Andrew McCreath
Chairman of the Board of Directors Director
/s/ DANI P. BOLOGNESI* /s/ MATTHEW A. MEGARO
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Dani P. Bolognesi, Ph.D. Matthew A. Megaro
Director Chief Operating Officer, Chief Financial
Officer, Executive Vice President and
Secretary (Principal Accounting and
Financial Officer)
/s/ BRIAN H. DOVEY* /s/ CHARLES A. SANDERS*
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Brian H. Dovey Charles A. Sanders, M.D.
Director Director
/s/ M. ROSS JOHNSON
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M. Ross Johnson, Ph.D.
President, Chief Executive Officer,
Chief Scientific Officer and Director
(Principal Executive Officer)
* Executed on behalf of these persons by
Matthew A. Megaro, duly appointed
Attorney-in-fact of each such person.
/s/ MATTHEW A. MEGARO
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Matthew A. Megaro
Attorney-in-Fact
</TABLE>
LICENSE AGREEMENT
This License Agreement ("LICENSE AGREEMENT"), effective as of September 9,
1997 ("EFFECTIVE DATE"), is by and between THE NEW YORK BLOOD CENTER, a not-for
profit corporation duly organized and existing under the laws of New York and
having an office at 310 East 67th Street, New York, New York 10021 ("NYBC"), and
TRIMERIS, INC., a corporation duly organized and existing under the laws of
Delaware and having a principal place of business at 4727 University Drive,
Durham, North Carolina 27707 ("TRIMERIS").
ARTICLE 1 - DEFINITIONS
For the purposes of this License Agreement, the following words and
pharases have the following meanings:
1.1 PATENT RIGHTS means:
1.1.1 United States Patent 5,444,044, as more fully described in
Appendix I;
1.1.2 United States Patent Application Serial No. 08/484,107, as more
fully described in Appendix I;
1.1.3 European Patent 565 164, as more fully described in Appendix I;
1.1.4 Australian Patent No. 667078, as more fully described in
Appendix I;
1.1.5 Canadian Patent Application No. 2,092,519, as more fully
described in Appendix I;
1.1.6 Japanese Patent Application No.5-68199, as more fully described
in Appendix I;
1.1.7 South Korean Patent Application No. 93-4698, as more fully
described in Appendix I;
1.1.8 Any later-filed United States and foreign patent applications
based on the patents or patent
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<PAGE>
applications listed in Appendix I, or corresponding thereto, including any
continuations, continuations-in-part, divisionals, reissues, reexaminations, or
extensions thereof; and
1.1.9 Any United States and foreign patents issuing from any of the
foregoing.
1.2 LICENSED PRODUCT includes the following:
1.2.1 NYBC PRODUCT means any product which incorporates an HIV-1
polypeptide having any one of the following sequences, as set forth in U.S.
Patent No. 5,444,044, appended as Appendix II: amino acid residues 637 to 666 of
the HIVIIIB1 envelope glycoprotein (Glu Trp Asp Arg Glu Ile Asn Asn Tyr Thr Ser
Leu Ile His Ser Leu Ile Glu Glu Ser Gln Asn Gln Gln Glu Lys Asn Glu Gln Glu),
SEQ ID NO's. 1 - 20, or which sequence is covered, in whole or in part, by a
claim contained in the Patent Rights.
1.2.2 TRIMERIS PRODUCT means any product which incorporates an HIV-1
polypeptide having greater than fifty percent (50%) of an amino acid sequence
which is identical in amino acid sequence composition and amino acid sequence
order with an HIV polypeptide having any one of sequences set forth in Paragraph
1.2.1.
1.2.3 OTHER PRODUCT means any product other than one specifically
defined in Paragraphs 1.2.1 and 1.2.2, which TRIMERIS may develop or sell, at
any time, during, or subsequent to, the term of this LICENSE AGREEMENT.
1.3 LICENSED PROCESS means any process or method which is covered in whole,
or in part, by a claim contained in the Patent Rights.
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<PAGE>
ARTICLE 2 - GRANT
2.1 NYBC hereby grants to TRIMERIS an exclusive, worldwide license to
practice under the PATENT RIGHTS and to make, have made, use, lease, offer to
sell, sell and import the LICENSED PRODUCTS and to practice the LICENSED
PROCESSES, to the full end of the term for which the PATENT RIGHTS are granted,
unless sooner terminated as hereinafter provided, said license to include the
right to sublicense and to be exclusive to TRIMERIS subject only to any license
heretofore granted to the United States government.
2.2 TRIMERIS agrees that any sublicenses granted by it will provide for
privity of contract between NYBC and sublicensee such that the obligations of
this LICENSE AGREEMENT will be binding upon the sublicensee as if it were in the
place of TRIMERIS.
ARTICLE 3 - DUE DILIGENCE
3.1 TRIMERIS will use its reasonable efforts to evaluate the commercial
potential of the PATENT RIGHTS. Subsequent to such evaluation, TRIMERIS, in its
sole discretion, will decide whether to commercialize any technology covered by
the PATENT RIGHTS.
3.2 TRIMERIS will use its best efforts to initiate a Pivotal Human Clinical
Trial, with any one NYBC PRODUCT or TRIMERIS PRODUCT, within five (5) years of
the EFFECTIVE DATE. In the event such trial is not initiated on any one such
royalty-bearing product, TRIMERIS will pay NYBC a one-time fee of Twenty-Five
Thousand Dollars ($25,000), such fee to be in addition to any other amounts that
otherwise might be due under Section 5.6.
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<PAGE>
ARTICLE 4 - LICENSE ISSUE FEE
Within fifteen (15) days of the EFFECTIVE DATE of this Agreement, TRIMERIS
will pay NYBC a License Issue Fee of Fifteen Thousand Dollars ($15,000).
ARTICLE 5 - ROYALTIES
For the rights, privileges and license granted hereunder, TRIMERIS agrees
to pay royalties to NYBC, to the end of the term of the PATENT RIGHTS [whether
by expiration, invalidation, abandonment, or other means] or until this
Agreement is terminated, whichever occurs first, as follows:
5.1 A royalty in an amount equal to 2.25 Percent (2.25%) of NET SALES of
NYBC PRODUCTS, sold by TRIMERIS, or by any sublicensee, in any calendar year,
which are covered, in whole, or in part, by one or more issued, unexpired, and
valid claims contained in the PATENT RIGHTS, in the country in which the product
is sold.
5.2 A royalty in an amount equal to 1.125 Percent (1.125%) of NET SALES of
NYBC PRODUCTS, sold by TRIMERIS, or by any sublicensee, in any calendar year,
which are covered, in whole, or in part, by one or more pending claims contained
in the PATENT RIGHTS, in the country in which the product is sold.
5.3 A royalty in an amount equal to 0.50% of NET SALES of TRIMERIS PRODUCTS
sold by TRIMERIS, or by any sublicensee, in any calendar year, until such time
as $100 million of NET SALES of TRIMERIS PRODUCTS is attained; after which
TRIMERIS will pay NYBC a royalty in an amount equal to 0.25% of NET SALES of
TRIMERIS PRODUCTS sold by TRIMERIS and any sublicensee in any calendar year in
any country where the
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<PAGE>
TRIMERIS PRODUCT is sold and NYBC has a pending, or issued, unexpired and
valid claim contained in the Patent Rights. Within one year of the EFFECTIVE
DATE, TRIMERIS, at its sole discretion, may substitute TRIMERIS equity for up to
fifty percent (50%) of the royalties otherwise due under this subsection.
5.4 Neither TRIMERIS nor any sublicensee will have any obligation during,
or subsequent to, the term of this LICENSE AGREEMENT, to pay any royalties to
NYBC for the manufacture, use, lease, sale, or offer to sell, of any OTHER
PRODUCT.
5.5 Any royalties paid by TRIMERIS or any sublicensee to a third party, in
any calendar year, as a condition of the manufacture, use, lease or sale of any
LICENSED PRODUCTS, or practice of any LICENSED PROCESS, may be deducted from the
amounts otherwise due under Paragraph 5.1, 5.2 and 5.3; provided, however, that,
in no event, will NYBC receive less than fifty percent (50%) of the amounts
otherwise due under Paragraphs 5.1 5.2, and 5.3.
5.6 Commencing with calendar year 1998 and for each calendar year
thereafter in which the LICENSE AGREEMENT remains in effect, should royalties
paid on LICENSED PRODUCTS not aggregate to the minimum set forth below,
TRIMERIS, with its last report for that year, will pay NYBC an amount equal to
the difference between the amount shown and the royalties already paid for that
year.
1998: $10,000
1999: $10,000
2000: $10,000
2001 and subsequent years $15,000
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<PAGE>
5.7 As used herein, the term NET SALES means the amount invoiced by
TRIMERIS or any sublicensee with respect to sale of any LICENSED PRODUCTS, less
the sum of the following:
(a) Discounts allowed in amounts customary in the trade;
(b) Sales, tariff duties, use taxes and/or insurance, directly imposed
and with reference to particular sales;
(c) Outbound transportation prepaid or allowed;
(d) Amounts allowed or credited on returns.
(e) Actual losses incurred due to changes in foreign currency exchange
rates.
5.8 Only one royalty will be payable to NYBC on NET SALES of LICENSED
PRODUCTS by TRIMERIS and/or by a sublicensee and/or by a subsidiary.
5.9 At any time during the term of this LICENSE AGREEMENT, TRIMERIS may
elect to pay NYBC sponsored research funds in an amount equal to, and in lieu
of, up to fifty percent (50%) of the total royalties otherwise due NYBC during
that calendar year, pursuant to Paragraphs 5.1, 5.2, and 5.3. TRIMERIS and NYBC
agree to enter into a Sponsored Research Agreement, to be negotiated in good
faith and to include such provisions as are reasonable and customary for such
agreements. With respect to any Sponsored Research Program funded, in any part,
by TRIMERIS pursuant to this Paragraph, NYBC hereby agrees to grant TRIMERIS a
right of first negotiation for an exclusive, royalty-bearing license to all
intellectual property arising out of such Sponsored Research Program, said
license to be negotiated in good faith and to include such provisions as are
reasonable and customary for such agreements.
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<PAGE>
5.10 Royalty payments shall be paid in United States dollars at the address
set forth in Article 14 or at such other place as NYBC may reasonably designate
consistent with the laws and regulations controlling in any foreign country. If
any currency conversion shall be required in connection with the payment of
royalties hereunder, such conversion shall be made by using the exchange rate
prevailing at the Chase Manhattan Bank in New York City, on the last business
day of the calendar quarterly reporting period to which such royalty payments
relate.
ARTICLE 6 - REPORTS AND RECORDS
6.1 TRIMERIS will keep and preserve complete and accurate books, records,
and accounts relating to the manufacture, use, and sale of LICENSED PRODUCTS and
TRIMERIS PRODUCTS, in accordance with generally accepted accounting principles
and procedures. NYBC, including its designated accountants, attorneys, agents,
and other representatives, will have the right, twice per year upon reasonable
notice to TRIMERIS, to examine, inspect, and audit, the books and records and
accounts, kept and preserved by TRIMERIS, to verify the accuracy and correctness
of the royalty payments made by TRIMERIS. All such examinations, inspections,
and audits, shall be made by NYBC, or its designated accountants, attorneys,
agents, or other representatives, at reasonable times and places, during
business hours.
6.2 TRIMERIS, within thirty (30) days after the end of each quarter of each
calendar year, shall deliver to NYBC true and accurate reports, giving such
particulars of the
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business conducted by TRIMERIS during the preceding three (3) month period under
this LICENSE AGREEMENT as shall be pertinent to a royalty accounting hereunder.
These shall include at least the following:
(a) Number and type of NYBC PRODUCTS and TRIMERIS PRODUCTS sold by
TRIMERIS or by any sublicensee;
(b) Total billings for NYBC PRODUCTS and TRIMERIS PRODUCTS sold;
(c) Detailed listing of all deductions applicable as provided in
Paragraph 5.7.
6.3 With each such report submitted, TRIMERIS will pay to NYBC the
royalties due and payable under this License Agreement. If no royalties are due,
TRIMERIS will so report.
ARTICLE 7 - PATENT PROSECUTION
7.1 Subject to Paragraph 7.3, NYBC will maintain the PATENT RIGHTS during
the term of this LICENSE AGREEMENT. All documents relating to the PATENT RIGHTS
will be forwarded to TRIMERIS within ten (10) business days of receipt by NYBC
or its patent counsel, whichever is earlier. NYBC will take no action with
respect to the PATENT RIGHTS without providing TRIMERIS a timely opportunity to
review and comment upon such action. NYBC will use its best efforts to ensure
that all actions taken with respect to any of the PATENT RIGHTS address the
commercial and business needs of TRIMERIS, as communicated by TRIMERIS
hereunder.
7.2 Within fifteen (15) business days after the receipt of an itemized
bill, TRIMERIS will reimburse NYBC for fifty percent (50%) of all reasonable and
ordinary fees and
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costs related to the filing, prosecution, and maintenance of the PATENT RIGHTS,
which were incurred prior to the EFFECTIVE DATE, the remaining fifty percent
(50%) to be paid within six months of the EFFECTIVE DATE.
7.3 Within thirty (30) days of receipt of an invoice, TRIMERIS will
reimburse NYBC for all reasonable and ordinary fees and costs relating to the
filing, prosecution, and maintenance of the PATENT RIGHTS, which are incurred
subsequent to the EFFECTIVE DATE.
7.4 TRIMERIS will have the sole right to decide whether to file, prosecute,
and/or maintain any patent application or patent contained in the PATENT RIGHTS.
Should TRIMERIS decide not to file, prosecute, and/or maintain any patent
application or patent contained in the Patent Rights, TRIMERIS, no later than
thirty (30) days prior to the applicable filing or other deadline, will provide
written notice to NYBC to this effect, which then shall have the right, but not
the obligation to file, prosecute and/or maintain the patent application or
patent at its own expense. TRIMERIS will have no further rights in any such
patent application and/or patent.
ARTICLE 8 - TERMINATION
8.1 In the event that either party shall become bankrupt or insolvent, or
shall file a petition in bankruptcy, or if its business shall be placed in the
hands of a receiver, assignee or trustee for the benefit of creditors, whether
by voluntary act or otherwise, then to the extent permitted by law, the other
party may terminate this Agreement by giving written notice of termination to
the disabled party. This
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Agreement shall terminate upon receipt of such notice, except with respect to
all accrued, unpaid royalties and sales.
8.2 Should TRIMERIS fail in its payment to NYBC of royalties due in
accordance with the terms of this License Agreement, NYBC will have the right to
serve notice upon TRIMERIS, by certified mail to the address designated in
Article 15 hereof, of its intention to terminate this License Agreement within
thirty (30) days after receipt of said notice of termination unless TRIMERIS
shall pay to NYBC, within the thirty (30) day period, all such royalties due and
payable. Upon the expiration of the thirty (30) day period, if TRIMERIS shall
not have paid all such royalties due and payable, the rights, privileges and
license granted hereunder shall thereupon immediately terminate.
8.3 Upon any material breach or default of this License Agreement by
TRIMERIS, NYBC will have the right to terminate this License Agreement and the
rights, privileges and license granted hereunder by ninety (90) days' notice to
TRIMERIS by certified mail to the address designated in Article 14 hereof. Such
termination will become effective unless TRIMERIS will have cured any such
breach or default prior to the expiration of the ninety (90) day period from
receipt of the notice of termination.
8.4 At any time subsequent to September 9, 2001, TRIMERIS will have the
right to terminate this LICENSE AGREEMENT on six (6) months' written notice to
NYBC.
8.5 Upon termination of this LICENSE AGREEMENT for any reason, nothing
herein shall be construed to release either party from any obligation that
matured prior to the effective date of such termination. TRIMERIS and/or any
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sublicensee thereof may, however, after the effective date of such termination,
sell all Licensed Products, and complete Licensed Products in the process of
manufacture at the time of such termination, and sell the same, provided that
TRIMERIS shall pay to NYBC the royalties thereon as required by Article 5 of
this License Agreement and shall submit the reports required by Article 6 hereof
on the sales of Licensed Products.
ARTICLE 9 - INFRINGEMENT AND OTHER ACTIONS
9.1 TRIMERIS and NYBC will promptly provide written notice, to the other
party, of any alleged infringement by a third party of the Patent Rights and
provide such other party with any available evidence of such infringement.
9.2 During the term of this LICENSE AGREEMENT, TRIMERIS will have the
right, but not the obligation, to prosecute and/or defend, at its own expense
and utilizing counsel of its choice, any infringement of, and/or challenge to,
the PATENT RIGHTS. In furtherance of such right, NYBC hereby agrees that
TRIMERIS may join NYBC as a party in any such suit, without expense to NYBC. No
settlement, consent judgment or other voluntary final disposition of any such
suit may be entered into without the consent of NYBC, which consent shall not
unreasonably be withheld. TRIMERIS shall indemnify NYBC against any order for
costs that may be made against NYBC in any such suit.
9.3 In the event that TRIMERIS shall undertake the enforcement and/or
defense of the Patent Rights, as provided in Paragraph 9.2, TRIMERIS may
withhold up to fifty percent (50%) of the royalties otherwise thereafter due
NYBC and apply the same toward reimbursement of its expenses, including
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attorneys' fees, in connection therewith. Any recovery of damages by TRIMERIS,
in any such suit, shall be applied first in satisfaction of any unreimbursed
expenses and legal fees of TRIMERIS relating to the suit, and next toward
reimbursement of NYBC for any royalties past due or withheld and applied
pursuant to this paragraph. The balance remaining from any such recovery shall
belong to TRIMERIS.
9.4 If within six (6) months after receiving notice of any alleged
infringement, TRIMERIS shall have been unsuccessful in persuading the alleged
infringer to desist, or shall not have brought and shall not be diligently
prosecuting an infringement action, or if TRIMERIS shall notify NYBC, at any
time prior thereto, of its intention not to bring suit against the alleged
infringer, then, and in those events only, NYBC shall have the right, but not
the obligation, to prosecute, at its own expense and utilizing counsel of its
choice, any infringement of the Patent Rights, and NYBC may, for such purposes,
join the TRIMERIS as a party plaintiff. The total cost of any such infringement
action commenced solely by NYBC shall be borne by NYBC and NYBC shall keep any
recovery or damages for past infringement derived therefrom.
9.5 In any suit to enforce and/or defend the Patent Rights pursuant to this
License Agreement, the party not in control of such suit shall, at the request
and expense of the controlling party, cooperate in all respects and, to the
extent possible, have its employees testify when requested and make available
relevant records, papers, information, samples, specimens, and the like.
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ARTICLE 10 - PATENT MARKING
TRIMERIS agrees to mark the LICENSED PRODUCTS sold in the United States
with all applicable United States patent numbers. All LICENSED PRODUCTS shipped
to, or sold in, other countries shall be marked in such a manner as to conform
with the patent laws and practice of the country of manufacture or sale.
ARTICLE 11- WARRANTY AND INDEMNIFICATION
11.1 NYBC warrants and represents that it has the full right and power to
grant the license set forth in Article 2 hereof, subject to the approval of both
parties at the time license negotiations are concluded, and shall take no action
to negate such right and power, and further warrants and represents that there
are no outstanding agreements, assignments, or encumbrances inconsistent with
the provisions of this License Agreement. EXCEPT AS OTHERWISE EXPRESSLY SET
FORTH IN THIS LICENSE AGREEMENT, NYBC MAKES NO REPRESENTATIONS AND EXTENDS NO
WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED
TO, WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, AND
VALIDITY OR NON-INFRINGEMENT OF PATENT RIGHT CLAIMS WHICH ARE ISSUED, OR
PENDING, RELATIVE TO INVENTION.
11.2 TRIMERIS shall, at all times during the term of this License Agreement
and thereafter, indemnify, defend and hold harmless NYBC, its officers,
employees, and affiliates, harmless against any claims, liabilities, judgments
and expenses, arising out of the death of, or injury to, any person or persons,
or out of any damage to property, and against any other claims of any kind
resulting from the production,
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manufacture, sale, advertising, lease, or transfer of Licensed Products or
Licensed Processes.
ARTICLE 12 - ASSIGNMENT
TRIMERIS may, without prior written consent, assign or otherwise transfer
this LICENSE AGREEMENT and the license granted hereunder and the rights acquired
by it hereunder so long as such assignment or transfer is to a subsidiary or
shall be accompanied by a sale or other transfer of TRIMERIS's entire business
or of that part of TRIMERIS's business to which the license granted hereunder
relates and so long as the transferee party expressly assumes, in writing, the
performance of all terms and conditions of this License Agreement. Any other
assignment of this LICENSE AGREEMENT by TRIMERIS will be permitted with NYBC's
written approval, such approval not to be unreasonably withheld and to be given
by NYBC within thirty (30) days of TRIMERIS providing the proposed Assignment to
NYBC for review. This License Agreement shall not be assignable by NYBC without
the prior written consent of TRIMERIS.
ARTICLE 13 - NON-USE OF NAMES
13.1 TRIMERIS shall not use the name of NYBC, or any of its employees, or
any adaptation thereof, in any advertising, promotional or sales literature
without prior written consent obtained from NYBC, in each case, except that
TRIMERIS may, without prior written consent, state that it is licensed by NYBC,
under one or more of the patents and/or applications comprising the PATENT
RIGHTS.
ARTICLE 14 - PAYMENTS, NOTICES
AND OTHER COMMUNICATIONS
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Any payment, notice or other communication pursuant to this License
Agreement shall be sufficiently made or given on the date of mailing if sent to
such party by certified first class mail, postage prepaid, addressed to it at
its address below or as it shall designate by written notice given to the other
party:
In the case of NYBC
Attn: Office of Patents and Licensing
Mark De Wyngaert, Ph.D.
The New York Blood Center
310 East 67th Street
New York, New York
cc: General Counsel
In the case of TRIMERIS:
Attn: Matthew A. Megaro
Chief Operating Officer
Trimeris, Inc.
4727 University Drive, Suite 100
Durham, North Carolina 27707
ARTICLE 15 - MISCELLANEOUS PROVISIONS
15.1 This LICENSE AGREEMENT shall be construed, governed, interpreted and
applied in accordance with the laws of New York, except that questions affecting
the validity, enforceability, or infringement of any patent contained in the
Patent Rights shall be determined by the law of the country in which the patent
was granted.
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15.2 The parties hereto acknowledge that this License Agreement sets forth
the entire agreement and understanding of the parties hereto as to the subject
matter hereof, and shall not be subject to any change or modification except by
the execution of a written instrument subscribed to by the parties hereto.
15.3 The provisions of this License Agreement are severable, and in the
event that any provision of this License Agreement shall be determined to be
invalid or unenforceable under any controlling body of law, such invalidity or
unenforceability shall not in any way affect the validity or enforceability of
the remaining provisions hereof.
15.4 The failure of either party to assert a right hereunder or to insist
upon compliance with any term or condition of this License Agreement shall not
constitute a waiver of that right or excuse a similar subsequent failure to
perform any such term or condition by the other party.
15.5 This LICENSE AGREEMENT may be executed in any number of 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 hereto have executed this License
Agreement, in duplicate, by proper persons thereunto duly authorized.
NEW YORK BLOOD CENTER
BY: /s/ JOHN E. WURMSER
----------------------------------
NAME: John E. Wurmser
---------------------------------
TITLE: CEO
---------------------------------
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DATE: Sept. 9, 1997
---------------------------------
TRIMERIS
BY: /s/ M. ROSS JOHNSON
---------------------------------
NAME: M. Ross Johnson
---------------------------------
TITLE: President, Chief Executive Officer
---------------------------------
DATE: September 10, 1997
---------------------------------
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NYBC/TRIMERIS
LICENSE AGREEMENT
APPENDIX I
1. U.S. Patent No. 5,444,044
Granted: August 22, 1995
To: Jiang and Neurath
For: Synthetic Polypeptides As Inhibitors Of HIV-1
Assignee: New York Blood Center
New York, New York
Based on: Appln. Serial No. 859,923
Filed March 26, 1992
2. U.S. Serial No.: 08/484,107
Filed: June 7, 1995
As a continuation of Ser. No. 859,923
(U.S. Pat. No. 5,444,044)
3. Foreign Counterparts of U.S. Patent No. 5,444,044:
<TABLE>
<CAPTION>
======================= ====================== ================================= ============================
COUNTRY SERIAL NO. FILING/ISSUE DATE STATUS
- ----------------------- ---------------------- --------------------------------- ----------------------------
<S> <C> <C> <C>
Australia 667078 Granted 6/25/1996 Patented
- ----------------------- ---------------------- --------------------------------- ----------------------------
EPO 0 565 164 Granted 6/11/1997 Patented
- ----------------------- ---------------------- --------------------------------- ----------------------------
Canada 2,092,519 Filed 3/25/1993 Pending
- ----------------------- ---------------------- --------------------------------- ----------------------------
Japan 5-68199 Filed 3/26/1993 Pending
- ----------------------- ---------------------- --------------------------------- ----------------------------
S. Korea 93-4698 Filed 3/25/1993 Pending
======================= ====================== ================================= ============================
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EXHIBIT 23.2
INDEPENDENT AUDITORS' CONSENT
The Board of Directors
Trimeris, Inc.:
We consent to the use of our report included herein and to the reference to
our firm under the heading "Experts" in the prospectus.
/s/ KPMG PEAT MARWICK LLP
---------------------------------------
Raleigh, North Carolina
October 3, 1997
<PAGE>
EXHIBIT 23.3
CONSENT OF COUNSEL
The undersigned hereby consents to the use of our name and the statement
with respect to us appearing under the heading "Experts" in Amendment No. 2 to
the Registration Statement on Form S-1 of of Trimeris, Inc.
/s/ PENNIE & EDMONDS LLP
---------------------------------------
PENNIE & EDMONDS LLP
New York, New York
October 3, 1997
