SENESTECH, INC. (NASDAQ:SNES) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01
| Entry into a Material Definitive Agreement. |
Effective as of January 23, 2017, SenesTech, Inc. (the Company)
entered into an agreement (the Settlement Agreement) with Neogen
Corporation (Neogen). to the Settlement Agreement, the parties
agreed to (a)terminate the existing Exclusive License Agreement
between the Company and Neogen dated May 15, 2014 (the License
Agreement), with neither Neogen or the Company having any further
obligations thereunder (other than certain confidentiality
obligations); (b) dismiss with prejudice the court action filed
by Neogen in the District Court for the District of Arizona on
January 19, 2017 (the Court Action); and (c) mutually release any
and all existing or future claims between the parties and their
affiliates related to or arising from the License Agreement or
the Court Action. As part of the Settlement Agreement, the
Company agreed to pay to Neogen upon the execution of the
Settlement Agreement an aggregate of $1,000,000, which includes,
in part, reimbursement of payments previously made to the Company
by Neogen under the License Agreement. The termination of the
License Agreement is discussed in further detail below in Item
1.02 of this Current Report on Form 8-K. The Court Action is
discussed in further detail below in Item 8.01 of this Current
Report on Form 8-K.
The foregoing description of the Settlement Agreement is not
complete and is qualified in its entirety by reference to the
full text of the Settlement Agreement, a copy of which is filed
as Exhibit 1.1 to this Current Report on Form 8-K and
incorporated herein by reference. In addition, a copy of the
Companys press release announcing the termination of the License
Agreement is filed with this report as Exhibit 99.1, and
incorporated herein by reference.
| Item 1.02 |
Termination of a Material Definitive Agreement. |
Item 1.01 of this Current Report on Form 8-K is incorporated
herein by reference.
Under the License Agreement, the Company had granted to Neogen an
exclusive license in North America to manufacture, distribute and
sell commercial rodent control products, which include
ContraPest, for the later of 10 years or the expiration of the
patent for ContraPest (if issued). Under the License Agreement,
the Company had retained rights to perform research and
development on rodent control products and for all other
scientific and non-commercial purposes. to the License Agreement,
the Company had also granted Neogen first right to license any
additional commercial fertility control animal applications in
North America other than rodents, and all commercial rodent
control products sold outside the U.S., if the Company sought to
license such applications to a non-affiliate. Under the License
Agreement, Neogen committed to pay the Company fees upon the
achievement of certain milestones, of which $487,500 had been
paid to date. In addition, Neogen would have been obligated to
pay the Company ongoing fees and royalties based on a percentage
of net sales, and both parties had agreed to certain
non-competition provisions.
As a result of the termination of the License Agreement, the
Company now retains full rights and capabilities to manufacture,
distribute and sell ContraPest in North America, and has been
released from the non-competition provisions of the License
Agreement. In addition, as a result of the termination of the
License Agreement, Neogen has been released from its obligations
under the License Agreement, including the payment of fees and
royalties, the obligation to manufacture and market the Companys
commercial rodent control products, and the non-competition
provisions of the License Agreement.
The Company believes that the termination of the License
Agreement will have a negligible impact on the commercialization
and manufacturing of ContraPest in the short term, as the Company
had previously scaled up its internal manufacturing capabilities.
The Company estimates that it can manufacture approximately
300,000 liters of ContraPest annually from its headquarters in
Flagstaff, Arizona with minor capital expenditures, which the
Company believes should be sufficient to meet anticipated
customer demand in 2017. Also, the Company believes that it can
add manufacturing capacity efficiently as needed.
However, based on its current estimates of customer demand for
ContraPest in the longer term, the Company anticipates that it
may need to increase its manufacturing capacity in the future,
and the Company intends to continue to develop and establish
third party relationships with manufacturing, marketing and
distribution partners in the U.S. and internationally. The
Company believes that the termination of the License Agreement
puts the Company in a stronger position to negotiate a
manufacturing, marketing or distribution arrangement that
provides the Company with a greater share of the overall
economics related to ContraPest sales.
| Item 8.01 | Other Events. |
Item 1.01 of this Current Report on Form 8-K is incorporated
herein by reference.
The Company and Neogen had been engaged in ongoing discussions
regarding manufacturing and commercialization plans under the
License Agreement, as well as the appropriate interpretation of
the License Agreement, including the non-competition provisions
set forth therein. On January 19, 2017, Neogen filed the Court
Action, in which Neogen raised claims relating to, among other
things, alleged breaches by the Company of the License Agreement,
interference with Neogens business, indemnification and
misrepresentation. As part of the Settlement Agreement, Neogen
agreed to dismiss with prejudice the Court Action and release the
Company and its affiliates from any and all existing or future
claims relating to or arising from the License Agreement.
to the Settlement Agreement, the parties agreed that such
agreement is a settlement of all disagreements that have arisen
between Neogen and the Company and that the entry into the
Settlement Agreement shall not be construed or considered to be
an admission of any liability by either party or of the merits of
any or claims that may have been raised between them, including
in the Court Action.
| Item 9.01 | Financial Statements and Exhibits. |
| (d) | Exhibits. | ||
|
ExhibitNo. |
Description |
||
| 1.1 |
Settlement Agreement and Release dated January 23, 2017 by and between Neogen Corporation and the registrant. |
||
| 99.1 | Press release dated January 23, 2017 | ||
About SENESTECH, INC. (NASDAQ:SNES)
SenesTech, Inc. is a platform biotechnology company. The Company is engaged in developing a technology for managing animal pest populations through fertility control. Its approach is designed to manage food security and manage infrastructure damage, disease outbreaks, environmental contamination and other costs associated with rodent infestations. Its fertility control product candidate, ContraPest, will be marketed for use in controlling rat populations. ContraPest targets the reproductive capabilities of rodents by inducing the gradual loss of eggs in female rodents and disruption of sperm in male rodents, resulting in contraception that can progress to sterility in both females and males. The Company applies its technology to manage rats in urban and agricultural settings. It has a pipeline of fertility control and animal health products, which include ContraPest, Plant-based fertility control, Feral animal fertility control, Boar taint, and Non-Surgical Spay and Neutering. SENESTECH, INC. (NASDAQ:SNES) Recent Trading Information
SENESTECH, INC. (NASDAQ:SNES) closed its last trading session down -0.04 at 7.34 with 166,124 shares trading hands.