-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, QFCd1ljopXLmSD/rfWwCUg1SEoIStCs0yhhkwSGOIVyZA3aXo8K3b6DAXC8bEbBb YHlaxOdcPbKtc6xlR2Ql7Q== 0000910647-04-000400.txt : 20041124 0000910647-04-000400.hdr.sgml : 20041124 20041124165158 ACCESSION NUMBER: 0000910647-04-000400 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20041118 ITEM INFORMATION: Entry into a Material Definitive Agreement ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20041124 DATE AS OF CHANGE: 20041124 FILER: COMPANY DATA: COMPANY CONFORMED NAME: IGI INC CENTRAL INDEX KEY: 0000352998 STANDARD INDUSTRIAL CLASSIFICATION: BIOLOGICAL PRODUCTS (NO DIAGNOSTIC SUBSTANCES) [2836] IRS NUMBER: 010355758 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-08568 FILM NUMBER: 041167786 BUSINESS ADDRESS: STREET 1: WHEAT RD AND LINCOCN AVE STREET 2: P O BOX 687 CITY: BUENA STATE: NJ ZIP: 08310 BUSINESS PHONE: 6096971441 MAIL ADDRESS: STREET 1: WHEAT ROAD AND LINCOCN AVE STREET 2: P O BOX 687 CITY: BUENA STATE: NJ ZIP: 08310 FORMER COMPANY: FORMER CONFORMED NAME: IMMUNOGENETICS INC DATE OF NAME CHANGE: 19870814 8-K 1 igi-8k5.txt FORM 8-K FOR NOVEMBER 18, 2004 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 ____________ FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): November 18, 2004 ___________________________________________________________ IGI, INC. (Exact Name of Registrant as Specified in Charter) ___________________________________________________________ Delaware 001-08568 01-0355758 (State or Other Jurisdiction (Commission (I.R.S. Employer of Incorporation) File Number) Identification Number) 105 Lincoln Avenue Buena, New Jersey 08310 (Address of Principal Executive Offices) (Zip Code) (856) 697-1441 (Registrant's Telephone Number, Including Area Code) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 1.01. Entry into a Material Definitive Agreement. On November 18, 2004, IGI, Inc. (the "Company") entered into an amendment to (i) the License and Supply Agreement, dated as of December 2, 1992 and amended on August 26, 1994, between the Company and Estee Lauder Inc. ("Estee Lauder"), and (ii) the Purchase Agreement, dated September 29, 1993, between the Company and Estee Lauder. Estee Lauder is the Company's largest customer. The amendment, among other things: (1) Grants to Estee Lauder (i) a non-exclusive, worldwide, royalty- bearing sublicense of the Company's rights under certain patents related to cosmetic products containing lipid vesicles (the "Products"), and (ii) the right to manufacture, or have manufactured, the Products. (2) Requires Estee Lauder to pay royalties to the Company equal to $5 per kilogram of Product manufactured by Estee Lauder; provided, however, that once Estee Lauder has paid $2,000,000 in royalties to the Company in any contract year, the royalty is reduced to $2 per kilogram for the remainder of the contract year. (3) Requires Estee Lauder to make a one-time payment of $100,000 to the Company for the right to fabricate equipment capable of manufacturing the Products. (4) Requires the Company, in 2005, to exercise a $1,000,000 option to extend for ten years the Company's exclusive license to certain lipid vesicle technology pursuant to the License Agreement, dated December 13, 1995, between one of the Company's subsidiaries and Micro-Pak, Inc. The amendment, dated November 18, 2004, is effective as of July 1, 2004. The amendment, and the Company's press release announcing the amendment, are attached hereto as Exhibits 10.1 and 99.1, respectively, and are hereby incorporated by reference. Item 9.01 Financial Statements and Exhibits. (c) Exhibits 10.1 Amendment of License and Supply Agreement, dated as of November 18, 2004, between IGI, Inc. and Estee Lauder Inc. 99.1 IGI, Inc. Press Release dated November 18, 2004. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. IGI, INC. By: /s/ Frank Gerardi ------------------------------- Frank Gerardi Chairman & Chief Executive Officer Date: November 23, 2004 EXHIBIT INDEX ------------- Exhibit Number Description - ------- ----------- 10.1 Amendment of License and Supply Agreement, dated as of November 18, 2004, between IGI, Inc. and Estee Lauder Inc. 99.1 IGI, Inc. Press Release dated November 18, 2004. EX-10 2 igi5-101.txt EXHIBIT 10.1 Exhibit 10.1 AMENDMENT OF LICENSE AND SUPPLY AGREEMENT WHEREAS, IGI has been granted the exclusive license to certain proprietary rights and intellectual property (including pursuant to certain patents) to a lipid vesicle technology for topical dermatologic products for localized usage at the delivery zone ("the Novasome Technology") pursuant to a License Agreement between Micro-Pak,, Inc., a wholly owned subsidiary of Novavax Inc., and Igen, Inc., a wholly owned subsidiary of IGI, dated December 13, 1995 (the "Novasome License Agreement), a copy of which is attached hereto as Exhibit A; WHEREAS, IGI (together with its affiliates, successors and assigns, IGI), on its own behalf and on behalf of MICRO VESICULAR SYSTEMS, INC (MVS) and MICRO-PAK, INC. (MPI) and ESTEE LAUDER INC. (Company) are parties to a License and Supply Agreement dated as of December 2, 1992, as amended by IGI and Company on August 26, 1994, and are parties to a Purchase Agreement dated September 29, 1993 (collectively, "Prior Agreements",attached hereto as Exhibits B and C, respectively) WHEREAS, pursuant to the Novasome License Agreement, IGI has developed and manufactured cosmetic products containing lipid vesicles ("Products") WHEREAS, pursuant to the Prior Agreements, Lauder has the exclusive right to purchase Products from IGI for sale in the department store or specialty store market, and IGI has granted Lauder an exclusive license to Products for sale in the department store or specialty store market; WHEREAS, IGI and Company wish to amend the Prior Agreements , under the terms and conditions set forth herein, NOW, THEREFORE, it is hereby agreed that: Capitalized terms used herein, but not otherwise defined shall have the meanings ascribed to such terms in the Prior Agreements. 1. (a) For purposes of the present amendment, "Novasome Patent Rights" shall mean all United States and foreign patents and patent applications currently in force and licensed to IGI under the Novasome License Agreement, and which patents are necessary for Company's manufacture, distribution, use or sale of the Products. IGI represents and warrants that an accurate list of those Novasome Patent Rights are attached as Appendix A thereto, and further represents that the last-to-expire patent expires on October 2, 2018 (b) "Field of Use" shall mean the use of the Novasome Patent Rights solely in connection with the manufacture, distribution, marketing, use, or sale of a cosmetic Product. 2. (a) IGI hereby converts the exclusive license to the Company to, and the Company accepts, subject to the terms and conditions of this Agreement, a non-exclusive, worldwide royalty bearing sublicense to the Novasome Patent Rights solely in the Field of Use, to the full end of the term for which the Novasome Patent Rights are in force, unless sooner terminated as hereinafter provided. (b) IGI, for itself and MVS, further grants Company the right to manufacture, or to have manufactured on its behalf by a third party, Products under the Novasome Patent Rights. (c) Commencing on the effective date, Company shall pay IGI a royalty of five dollars ($5.00)/kilogram for Products manufactured by Company, up to a maximum of two million dollars ($2,000,000) in royalties in any Contract Year, a Contract Year being defined as the year following the Effective Date of this Agreement, or a year following subsequent anniversaries of the Effective Date. Once two million dollars in royalties have been paid to IGI in any Contract Year, the royalty payable to IGI shall be reduced to two dollars ($2.00)/kilogram for the remainder of that Contract Year. Should IGI have a reasonable basis for asserting that the royalty volume tracking procedures employed by Company are inadequate, then IGI shall have the right of requesting a flow meter be installed on Company's machines to track volumes. (d) Within thirty (30) days of execution of this Amendment of Agreement, Company will pay IGI a one-time fee of $100,000, for the right to fabricate equipment capable of manufacturing Products. This right shall include the right to fabricate equipment through IGI's equipment supplier, or through a supplier of Company's choice. There in no limit on the number of pieces of equipment that may be fabricated under this one- time payment. However, Company shall inform IGI of any new equipment produced and the address of where such machines are located. (e) All non-Product bulk manufacture that IGI produces for Company shall cease as of June 30, 2004. (f) IGI will use its best efforts to maintain the Novasome License and shall not take any action nor fail to take any required action that would impair the rights of the Company to use the Novasome Patent Rights in the Field of Use. (g) As per the terms of the Novasome License Agreement, IGI was granted a license to the Novasome Technology for a term of 10 years, as well as an option to extend the exclusive license rights granted therunder, exercisable in the last year of the initial 10 years license period, upon payment of an option fee of One Million Dollars ($1,000,000) ("Option to Extend"). The initial 10 year license granted to IGI under the Novasome License Agreement expires on or about December 12 2005. IGI expressly represents and warrants that it shall exercise the Option to Extend and has already advised Novavax of such intention. IGI further represents and warrants that it shall have available the financial and/or other resources to satisfy the Option Fee due and payable on or about December 12, 2005, to exercise the Option to Extend. No later than sixty (60) days prior to the expiration of the Novasome License Agreement, IGI shall provide Company with written confirmation of its exercise of the Option to Extend. Should IGI fail to exercise the Option, Company shall have the right to extend its rights hereunder, under substantially the same terms and conditions, by direct license from MVS, MPI or other appropriate IGI affiliate, with no further obligation to IGI. 3. IGI represents that to its best knowledge, it is not currently in breach, nor has it received notice from any granting party that it is in breach, of any provision of the Novasome License Agreement. To IGI's knowledge and belief there are no licenses, options, restrictions, liens, rights of third parties, disputes, royalty obligations, proceedings or claims relating to, affecting, or limiting its rights or the rights of the Company under this Agreement with respect to, or which may lead to a claim of infringement or invalidity regarding, any part or all of the Novasome Patent Rights and their use as contemplated in the underlying patent applications as presently drafted. IGI further warrants that Company's manufacture of Products utilizing Novasome Technology and Company's sale and distribution of Products will not infringe upon any US or foreign patent or violate any valid rights of any person or any applicable law, rule or violation. 4. This Amendment of Agreement shall continue in force and effect for a period of three years from the Effective Date, automatically renewed thereafter on a yearly basis, unless otherwise terminated as provided herein, during the term of the Novasome License Agreement, including any period of time granted pursuant to the exercise of the Option to Extend. The Agreement may be terminated upon the earlier to occur of (a) the expiration, invalidation or abandonment of the last to expire Novasome Patent Right that applies to the Products, (b) Company's ninety (90) day written notice to IGI that it elects to discontinue its sale of Products, (c) at Company's option, as provided in Paragraph 7(b) of the License and Supply Agreement. 5. Those Articles, or pertinent portions thereof, in the Prior Agreements that are not inconsistent with the amended terms herein remain in full force and effect and are incorporated herein by reference. These Articles include, but are not necessarily limited to Articles 5, 6, 7, 8, 9 and 10 of the License and Supply Agreement. 6. The addresses for notice for each party shall be as follows: To Estee Lauder: Estee Lauder Companies 350 South Service Road Melville, NY 11747 Attention: Senior Vice-President, Global Manufacturing and Distribution Fax: (631)454-5328 With copy to: Legal Department 125 Pinelawn Road Melville, NY 11747 Fax: (631)531-1340 To IGI: IGI Inc. P.O. Box 687 Wheat Road and Lincoln Avenue Buena, New Jersey Attn: Frank Gerardi, CEO Fax: MVS and MPI hereby acknowledge the foregoing Agreement between IGI and Company and agree that, by execution of such Agreement by IGI, MVS and MPI are bound by the provisions herein. 7. The Effective Date of this Agreement shall be July 1, 2004. IN WITNESS WHEREOF, the Parties hereto have executed this Agreement by proper persons thereunto duly authorized. Name Frank Gerardi CEO. IGI Inc. /s/ Frank Gerardi ------------------------------------ Frank Gerardi Date November 16, 2004 Estee Lauder Inc. By: /s/ Joseph D. Guarascio -------------------------------- Joseph D. Guarascio Title: Senior Vice President, Global Mfg. ----------------------------- APPENDIX A - --------------------------------------------------------------------------- United States Patent 4,853,228 Wallach , et al. August 1, 1989 Method of manufacturing unilamellar lipid vesicles - --------------------------------------------------------------------------- United States Patent 4,855,090 Wallach August 8, 1989 Method of producing high aqueous volume multilamellar vesicles - --------------------------------------------------------------------------- United States Patent 4,895,452 Yiournas , et al. January 23, 1990 Method and apparatus for producing lipid vesicles - --------------------------------------------------------------------------- United States Patent 4,911,928 Wallach March 27, 1990 Paucilamellar lipid vesicles - --------------------------------------------------------------------------- United States Patent 5,147,723 Wallach September 15, 1992 Paucilamellar lipid vesicles - --------------------------------------------------------------------------- United States Patent 5,160,669 Wallach , et al. November 3, 1992 Method of making oil filled paucilamellar lipid vesicles - --------------------------------------------------------------------------- Page 1 of 2 - --------------------------------------------------------------------------- United States Patent 5,234,767 Wallach August 10, 1993 Hybrid paucilamellar lipid vesicles - --------------------------------------------------------------------------- United States Patent 5,260,065 Mathur , et al. November 9, 1993 Blended lipid vesicles - --------------------------------------------------------------------------- United States Patent 5,439,967 Mathur August 8, 1995 Propylene glycol stearate vesicles - --------------------------------------------------------------------------- United States Patent 5,474,848 Wallach December 12, 1995 Paucilamellar lipid vesicles - --------------------------------------------------------------------------- United States Patent 5,628,936 Wallach May 13, 1997 Hybrid paucilamellar lipid vesicles - --------------------------------------------------------------------------- United States Patent 5,643,600 Mathur July 1, 1997 Lipid vesicles containing avocado oil unsaponifiables - --------------------------------------------------------------------------- United States Patent 5,756,014 Mathur May 26, 1998 Heat resistant lipid vesicles - --------------------------------------------------------------------------- Page 2 of 3 - --------------------------------------------------------------------------- United States Patent 6,251,425 Mathur , et al. June 26,2001 Glucoside Paucilamellar Vesicles - --------------------------------------------------------------------------- Page 3 of 3 EX-99 3 igi5-991.txt EXHIBIT 99.1 Exhibit 99.1 News From IGI LOGO Buena, NJ 08310 - --------------------------------------------------------------------------- Release Date: November 18, 2004 Contact: Frank Gerardi Chairman & Chief Executive Officer IGI, Inc. (856) 697-1441 ext. 102 www.askigi.com IGI, Inc. Signs New Three Year License Agreement With A Major Customer BUENA, NJ November18, 2004 - IGI, INC. (AMEX: IG) today announced a new three year licensing agreement with the Company's largest customer. Under the terms of the new agreement, IGI, Inc. will receive a one-time payment for allowing this customer to produce Novasomes(r) microvesicles in-house with IGI, Inc.'s patented Novamix(r) machine. IGI, Inc. will also receive royalty payments based on their in-house production volume. In order to respect our customer's policy, IGI is not using their name in this press release. Additional information can be found in our third quarter 10-Q filing. The exclusivity clause has been removed under the new agreement, which allows IGI, Inc. to offer its Novasome(r) Micro-Vesicular Technology to a wide range of new customers as well as expanding product lines with existing clients. "The release of the exclusivity has resulted in over seventy new products being formulated, of which twenty two have been approved, by new and existing customers using our patented Novasome(r) nano-microencapsulation transdermal delivery system", stated Frank Gerardi, IGI's Chairman and CEO. The statements in this release by Frank Gerardi are forward-looking statements that are based on current expectations, estimates and projections about the Company's business based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors, including the following: changes in demand for the Company's products, product mix, the timing of customer orders or deliveries, the impact of competitive products and pricing, constraints on supplies of critical components, excess or shortage of production capacity and other risks discussed from time to time in the Company's SEC filings. In addition, such statements could be affected by general industry and market conditions and growth rates, and general domestic and international economic conditions. Such forward-looking statements speak only as of the date on which they are made and the Company does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of the release. -----END PRIVACY-ENHANCED MESSAGE-----