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Subsequent Events
6 Months Ended
Jun. 30, 2023
Subsequent Events [Abstract]  
Subsequent Events

9. Subsequent Events

 

Entry into License Agreement with ResolutionRx Ltd

 

On August 3, 2023, RespireRx (“Licensor”) and ResolutionRx (“Licensee”), its wholly-owned, unlisted, public Australian subsidiary entered into a License Agreement (“License Agreement”) pursuant to which, RespireRx has licensed to ResolutionRx, the Intellectual Property (“Licensed IP” as defined in the License Agreement) which includes the Patent Rights (“Patent Rights” as defined in the License Agreement). The License (“License”) is an exclusive, worldwide and royalty-free license during the Term to use and exploit the Licensed IP in connection with ResolutionRx’s business and operations, including commercial and non-commercial purposes, with the exception that RespireRx shall have the exclusive right to use the technology described in the Licensed IP for non-cannabinoid products. ResolutionRx shall use its best efforts to commercialize the Licensed IP.

 

The Licensed IP is basically, the intellectual property and patent rights, identified in Schedule A of the License Agreement and associated with the new dronabinol formulation initially to be developed for the treatment of obstructive sleep apnea.

 

The consideration for the License and the related Sublicense (see Sublicense Agreement between RespireRx Pharmaceuticals Inc. and ResolutionRx Ltd and Share Transfer Agreement below) is the issuance of 25,000,000 Ordinary Shares of ResolutionRx to RespireRx plus the payment of US$1 to RespireRx.

 

Licensee shall not sublicense any of its rights and/or obligations under the License Agreement without the prior written consent of Licensor, except to contract manufacturers, distributors and other third parties engaged by Licensee pursuant to the normal course of Licensee’s business (the “Sublicensees”) on terms consistent with and not in conflict with this License Agreement, and in no event less protective of Licensor’s rights than those set forth in the License Agreement. Such agreements with Sublicensees shall terminate upon termination of this License Agreement.

 

The Licensor shall be responsible for patent prosecution and maintenance and Licensee shall promptly either pay directly or reimburse Licensor’s costs in each jurisdiction.

 

ResolutionRx as Licensee, at its option may control prosecution and maintenance of the Patent Rights.

 

The License Agreement also addresses how the parties are to deal with interferences, if any.

 

All unpublished information is to be treated confidentially.

 

 

ResolutionRx acknowledges in the License Agreement, that RespireRx is the owner of all right, title and interest in and to the Licensed IP, including all modifications, enhancements, improvements and other derivative works (“Modifications”). All Modifications are Licensed IP immediately upon their creation.

 

Licensee shall promptly notify Licensor of any actual or potential infringement, counterfeiting, or other unauthorized use of the Licensed IP by any other person or entity of which Licensee becomes aware. Licensor shall have the right, but not obligation, in its sole discretion, to enforce its rights in the Licensed IP, including to bring action with respect to any infringement of the Licensed IP. 

 

With respect to the Licensed Patents, the term of the License Agreement shall commence as of the Effective Date, as defined in the License Agreement, and shall be effective until the last of the Licensed Patents, as defined in the License Agreement, expires (the “Patent Term”). With respect to the Licensed IP but excluding the Licensed Patents, the initial term of this License Agreement shall commence as of the Effective Date and shall be effective for a period of two (2) years (the “Initial Term”) and shall automatically be renewed for successive annual terms (each a “Renewal Term”) unless Licensee gives written notice to the Licensor of its intent not to renew at least sixty (60) days prior to the end of the Initial Term or then current Renewal Term, as applicable.

 

Licensee and Licensor have indemnified one another.

 

The License Agreement is governed by and construed in accordance with Delaware Law, without regard to any choice or conflict of law provision or rule (whether of the State of Delaware or any other jurisdiction).

 

Entry into Sublicense Agreement with ResolutionRx Ltd

 

On August 3, 2023, RespireRx as sublicensor (“Sublicensor”) and ResolutionRx as sublicensee (“Sublicensee”), entered into a Sublicense Agreement (“Sublicense Agreement”) whereby Sublicensor, sublicensed the rights to its Exclusive License Agreement with The Board of Trustees of the University of Illinois, a body corporate and politic of the State of Illinois (“University”), effective June 27, 2014 (the “Original License”) and amended via that certain letter amendment, effective August 2, 2017 (the “Letter Amendment”) and that certain Second Amendment to RespireRx-University of Illinois Exclusive License Agreement, effective December 15, 2022 (the “Second Amendment,” and collectively with the Original License and Letter Amendment, the “Exclusive License” which is the same as the 2014 License Agreement described elsewhere in our condensed consolidated financial statements as of June 30, 2023), pursuant to which the University granted to RespireRx certain rights and licenses.

 

The Exclusive License permits Sublicensor to grant written sublicenses of its rights under the Exclusive License.

 

The consideration for the Sublicense and the related License (see License Agreement between RespireRx Pharmaceuticals Inc. and ResolutionRx Ltd above and Share Transfer Agreement below) is the issuance of 25,000,000 Ordinary Shares of ResolutionRx to RespireRx plus the payment of US$1 to RespireRx.

 

The Sublicense is essentially a direct pass-through of all of the rights and obligations associated with the Exclusive License from RespireRx as Sublicensor to ResolutionRx as Sublicensee.

 

The Sublicense expires upon the termination of the Exclusive License.

 

Entry into Stock Transfer Agreement with ResolutionRx Ltd

 

On August 3, 2023, ResolutionRx as transferor (“Transferor”) and RespireRx as transferee (“Transferee”) entered into a Stock Transfer Agreement (“Stock Transfer Agreement”) whereby the Transferor and Transferee agreed that Transferor which has the authority under its Constitution to issue the 25,000,000 Ordinary Shares that are set out in the Stock Transfer Agreement, transfers absolutely, all title over the Ordinary Shares to the Transferee in consideration of the License Agreement and the Sublicense Agreement.

 

 

Entry into Master Intercompany Services Agreement with ResolutionRx Ltd

 

On August 3, 2023, RespireRx as the provider of services (“Provider”) and ResolutionRx as the recipient of services (“Recipient”) entered into a Master Intercompany Services Agreement (“MISA”). As of the date of the MISA, ResolutionRx was a wholly-owned Australian unlisted public subsidiary of RespireRx.

 

Provider performs certain support activities in the form of both general and administrative and research and development support in the execution of the business operations of Recipient.

 

The initial term of the MISA is from August 3, 2023 for two years. The MISA automatically renews for successive one-year periods unless Recipient gives written notice to Provider of its intent not to renew at least ninety days prior the end of the initial term or any renewal term.

 

Provider will provide the services as set forth on Schedule A of the MISA on an ongoing basis as well as such further services as Recipient and Provider may specifically agree upon from time to time (the “Services”). As noted on Schedule A, and for clarity, Recipient specifically agrees to remit to Provider for the Services or components (“Components”) of the Services until such time as the Components are no longer required and when such Components are provided by a party in Australia other than Provider, or such Components are no longer subcontracted for by Provider and Provider agrees to no longer provide such Components or Services.

 

The MISA also describes the selection of personnel and subcontracting.

 

Provider will invoice Recipient for the Services to be performed on a quarterly basis (based on the fiscal year of Recipient) with such invoices to be issued, in advance, for Services to be rendered in the quarter following the date of each such invoice.

 

Recipient will pay Provider a fee (“Fee”) as set forth on Schedule B of the MISA, which may be amended by the Parties from time to time. Only those costs and expenses wholly and exclusively or otherwise properly attributed to the provision and coordination of provision of the Services will be included in the calculation of the Fee. Fees are payable in US dollars unless otherwise agreed by the parties.

 

Annually, based on the fiscal year of Recipient, Provider must deliver to Recipient its budget for the costs and expenses it reasonably believes will be incurred in the provision of the Services (“Budget”) which amounts may be increased by written agreement of Recipient and Provider.

 

The Recipient and the Provider have each indemnified one another. The MISA also establishes confidentiality provisions.

 

Post June 30, 2023 Convertible Note Conversions

 

During the period from July 11, 2023 through August 18, 2023, three convertible note holders of notes with substantially similar attributes converted $65,753 of principal, $747 of interest, $1,000 of conversion fees for a total of $67,500, into 45,000,000 shares of Common Stock at a conversion price, in each case, of $0.0015 per share of Common Stock.

 

Patent fees and maintenance fees of $35,185 due to UWMRF at August 1, 2023 were unpaid

 

Payment of $35,185 comprised of $30,185, which is 50% of the patent fees identified in the license and $5,000 annual maintenance fee were due to UWMRF but unpaid at August 1, 2023.