Sample Business Contracts

Research and License Agreement - Sloan-Kettering Institute for Cancer Research and Celsion Corp.

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                    RESEARCH AND LICENSE AGREEMENT (SK#4826)

                              for SKI's technology

                          "Heat Sensitive Gene Therapy"
                                    (SK 797)

                                TABLE OF CONTENTS
          I                 DEFINITIONS
          II                RESEARCH PROGRAM
          III               GRANT
          IV                DUE DILIGENCE
          V                 PAYMENTS
          VI                REPORTS AND RECORDS
          VII               PATENT PROSECUTION
          VIII              INFRINGEMENT
          IX                PRODUCT LIABILITY
          X                 EXPORT CONTROLS
          XI                NON-USE OF NAMES
          XII               ASSIGNMENTS
          XIII              TERMINATION
          XV                MISCELLANEOUS PROVISIONS

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This Agreement is effective on the date last subscribed below (the "Effective
(HEREINAFTER referred to as "SKI"), a New York membership corporation with
principal offices at 1275 York Avenue, New York, New York 10021, and CELSION
CORPORATION, a corporation with principal offices located at 10220-1 Old
Columbia Road, Columbia, Maryland 210461705 ("LICENSEE").


        WHEREAS, SKI is the owner of certain Patent Rights (as later defined
herein) and has the right to grant licenses under said Patent Rights; and

        WHEREAS, SKI desires to have the Patent Rights utilized in the public
interest and is willing to grant a license to its interest thereunder; and

        WHEREAS, LICENSEE seeks to commercially develop the Patent Rights
through a thorough, vigorous and diligent program of exploiting the Patent
Rights whereby public utilization shall result therefrom; and

        NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein, the parties hereto agree as follows:

                            ARTICLE I - DEFINITIONS

For the purpose of this Agreement, the following words and phrases shall have
the following meanings:

        1.1.    "LICENSEE" shall include Affiliates, that is, any person, firm,
corporation or other entity controlling, controlled by, or under common control
with a party hereto. The term "control" wherever used throughout this Agreement
shall mean ownership, directly or indirectly, of more than 50% of the equity
capital. With regard to SKI, "Affiliate" shall mean the Memorial Sloan-Kettering
Cancer Center and the Memorial Hospital for Cancer and Allied Diseases.

        1.2.    "Patent Rights" shall mean all of the following SKI intellectual

                (a)     The United States and foreign patents and patent
                        applications listed in Exhibit A;

                (b)     United States and foreign patents issued from the
                        applications listed in Exhibit A, and from divisionals
                        and continuations of these applications;

                (c)     claims of U.S. and foreign continuation-in-part
                        applications, and of the resulting patents, which are
                        directed to subject matter specifically described in the
                        U.S. and foreign patent applications listed in Exhibit

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                (d)     any reissues or re-examinations of patents described in
                        (a), (b), or (c), above.

        1.3.    A "Licensed Process" shall mean any process which is covered in
whole or in part by an issued, unexpired claim or a pending claim contained in
the Patent Rights in any country in which such process is practiced.

        1.4.    A "Licensed Product" shall mean any product or part thereof
made, leased, used or sold by or on behalf of LICENSEE which:

                (a)     is covered in whole or in part by an issued, unexpired
                        claim or a pending claim contained in the Patent Rights
                        in the country in which any product or part thereof is
                        made, leased, used or sold; or

                (b)     is manufactured by using a Licensed Process.

        1.5.    "Net Sales" shall mean LICENSEE's and its sublicensees' billings
for sales of Licensed Products or Licensed Processes produced hereunder less the
sum of the following:

                (a)     Discounts allowed in amounts customary in the trade;

                (b)     Sales, tariff duties and/or use taxes directly imposed
                        and with reference to particular sales;

                (c)     Outbound transportation prepaid or allowed;

                (d)     Amounts allowed or credited on returns; and

                (e)     Bad debts and uncollectible receivables.

        No deductions shall be made for commissions paid to individuals whether
they be with independent sales agencies or regularly employed by LICENSEE or
Affiliates and on its payroll, or for cost of collections. Licensed Products
shall be considered "sold" when billed or invoiced.

        1.6.    "Royalty Year" shall mean each twelve-month period commencing
January 1 and ending December 31 during the term of this Agreement. For the
first year of this Agreement, the Royalty Year shall be the period of time
between the signing of the Agreement and December 31.

        1.7.    "Field of Use" shall mean the use of the Patent Rights in the
field of treatment of human disease.

        1.8.    "Research Program" shall mean investigations to be conducted by
SKI under this Agreement, as described in Exhibit B attached hereto, and as
described in revisions of Exhibit B which may be agreed upon in writing by the

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                         ARTICLE II - RESEARCH PROGRAM

        2.1.    SKI shall perform studies of Research Program. The Principal
Investigator assigned by SKI for directing the performance of the work is Dr.
Gloria Li. If for any reasons the Principal Investigator becomes unavailable,
SKI shall notify the LICENSEE . If a mutually acceptable successor is not
identified, the Research Program will be terminated in accordance with Section
2.9 below.

        2.2.    It is understood that SKI and the personnel performing the
Research Program hereunder may be or become involved in other activities and
projects which entail commitments to other sponsors. SKI will use its best
efforts to avoid conflicts with the Research Program; however, it is agreed that
unless provided to the contrary herein, SKI's Research Program obligations
outlined in Article II are subject to SKI's commitments to such other sponsors.

        2.3.    In consideration of SKI carrying out the Research Program,
LICENSEE shall pay to SKI annually in advance such sums as are agreed and set
out in Exhibit B. Subject to prior written notification by SKI, LICENSEE shall
also pay additional sums for salaries (and reasonable overheads thereon) in
order to accommodate reasonable salary increases which take effect after the
Effective Date, the timing of such additional payment to be agreed between the

        2.4.    SKI shall inform LICENSEE of the progress of the Research
Program on a regular basis as mutually agreed to by both parties. A final
written report shall be submitted by SKI to LICENSEE within one month of
completion of the Research Program.

        2.5.    While it is understood that SKI is free to publish the results
of its research carried out under this Article 2, LICENSEE shall be given an
opportunity to review any proposed manuscripts regarding this work prior to
submission for publication. LICENSEE agrees to complete its review and to inform
SKI of its comments within thirty (30) days of receipt of SKI's manuscripts; if
no response is received within such thirty (30) days, it may be conclusively
presumed that the publication may proceed without delay. If LICENSEE determines
that the proposed publication contains patentable matter which requires
protection, LICENSEE may require the delay of the publication for a period of
time not to exceed sixty (60) days for the purpose of allowing the pursuit of
such protection. Without the prior written consent of LICENSEE, SKI shall not
publish or permit to be published any information which LICENSEE reasonably
deems to be LICENSEE's Confidential Information. When publishing, SKI shall
appropriately acknowledge LICENSEE's financial support of this research.

        2.6.    All original research results, data, records and work product
generated under this Agreement, including all tangible and intangible property,
shall be owned by SKI.

        2.7.    (a)     Any inventions or discoveries ("Inventions") made under
                        the Research Program solely by SKI employees shall
                        belong to SKI. SKI shall promptly disclose potentially
                        patentable Inventions to LICENSEE, provided that
                        LICENSEE shall hold all such disclosures in confidence
                        and shall not further disclose or use same in ways not
                        previously approved in writing by SKI. At LICENSEE's
                        request and expense, SKI shall promptly prepare,

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                        file and/or maintain patent applications or issued
                        patents in the United States and foreign countries for
                        any such Inventions. Any inventions or discoveries made
                        during the Research Program jointly by SKI employees and
                        by the LICENSEE's employees shall be jointly owned by
                        SKI and LICENSEE. LICENSEE shall have the rights to
                        obtain patent protection in the United States and
                        foreign countries for such joint inventions, at its
                        expense, unless otherwise agreed upon by the parties.

                (b)     SKI grants to LICENSEE an option to obtain a license to
                        each Invention solely owned by SKI, and to SKI's
                        interest in any joint inventions, through good faith
                        negotiations and on commercially reasonable terms. The
                        option shall extend for a period of three (3) months
                        following disclosure of the Invention to the LICENSEE.
                        In the event the parties, acting in good faith, fail to
                        reach a mutually acceptable agreement within three (3)
                        months after commencing negotiations, SKI shall be
                        entitled to negotiate a license with a third party for
                        such Invention.

PARTY PROPERTY RIGHTS. LICENSEE shall indemnify, defend and hold harmless SKI
and its affiliates and its employees from any liability resulting from
LICENSEE's use of the Results or materials provided by SKI, or other LICENSEE's
activities in the course of the Research Program.

        2.9.    The Research Program may be terminated by either party giving to
the other a minimum of ninety (90) days prior written notice. In the event of
termination of the Research Program, LICENSEE shall pay to SKI, within thirty
(30) days of invoice from SKI, for all direct costs, up to and including the
effective date of termination, and all applicable indirect costs and all
non-cancelable obligations made before receipt of notice of termination, even
though such obligations may extend beyond the termination date.

                              ARTICLE III - GRANT

        3.1.    SKI hereby grants to LICENSEE an exclusive worldwide right and
license in the Field of Use, including the right to sublicense, to make, have
made, use, lease and sell Licensed Products and to use Licensed Processes
derived from the Patent Rights until the Patent Rights expire, unless this
Agreement is terminated before that time according to the terms hereof, and
subject to the rights reserved or observed in Section 2.2 below.

        3.2.    Notwithstanding any other provisions of this Agreement, it is
agreed that SKI and its Affiliates shall retain the right to practice the
licensed Patent Rights for its own teaching, research and patient care
activities. All rights reserved to the United States Government and

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others under 35 USC 33200-212, as amended, shall remain and shall in no way be
affected by this Agreement.

        3.3.    LICENSEE hereby agrees that every sublicensing agreement to
which it shall be party and which shall relate to the rights, privileges and
license granted hereunder shall contain a statement describing the date upon
which LICENSEE'S exclusive rights, privileges and license hereunder shall

        3.4.    LICENSEE agrees that any sublicenses granted by it shall provide
that the obligations to SKI of Article IV, VI, VIII, IX, X, XI, XII, XIII and XV
of this Agreement shall be binding upon the sublicensee as if it were a party to
this Agreement. LICENSEE further agrees to attach copies of these Articles to
sublicense agreements.

        3.5.    LICENSEE agrees to forward to SKI a copy of any and all fully
executed sublicense agreements, and further agrees to timely forward to SKI a
copy of such reports received by LICENSEE from its sublicensees during the
preceding Royalty Year.

        3.6.    If LICENSEE receives from sublicensees anything of value in lieu
of cash payments based upon payment obligations of any sublicense under this
Agreement, LICENSEE shall pay SKI royalty or other payments as required by
Clause 5.1(b), based on the fair market value of such payment, unless SKI waives
in writing such payment obligation.

        3.7.    The license granted hereunder shall not be construed to confer
any rights upon LICENSEE by implication, estoppel or otherwise as to any
technology not included in the Patent Rights.

                           ARTICLE IV - DUE DILIGENCE

        4.1.    LICENSEE and its sublicensees shall use their best efforts to
bring Licensed Products or Licensed Processes to market through a thorough,
vigorous and diligent program for exploitation of the Patent Rights and to
continue active, diligent marketing efforts for one or more Licensed Products or
Licensed Processes throughout the life of this Agreement.

        4.2.    In addition, LICENSEE shall adhere to the following milestones:

                (a)     Within three (3) months of LICENSEE's receipt of final
                        report of Research Program or within eighteen (18)
                        months of the Effective Date of this Agreement,
                        whichever is earlier, LICENSEE shall deliver to SKI, its
                        detailed business, research and development plan
                        including, for example, relevant schedules of capital
                        investments needed to implement the plan, financial,
                        equipment, facility plans, number and kind of personnel
                        and time planned for each phase of development of the
                        Patents Rights for a three year period. Similar reports
                        shall be provided to SKI annually to relay update and
                        status information on LICENSEE's business, research and
                        development progress, including projections of activity
                        anticipated for

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                        the next reporting year. In the event SKI, after full
                        examination of each such report, determines the report
                        is insufficient in detail or in LICENSEE's progress in
                        bringing a Licensed Product to market in accordance with
                        Section 4.1, SKI shall notify LICENSEE. If within two
                        (2) months of such notification, LICENSEE fails to so
                        satisfy SKI, then SKI shall give notice of same and may
                        terminate this Agreement pursuant to Section 13.4 below.

                (b)     LICENSEE shall be responsible for diligently and
                        promptly taking all reasonable steps to secure all
                        required and/or necessary governmental approvals to
                        sell, exploit, or market any and all Licensed Products.
                        LICENSEE shall advise SKI, through annual reports
                        described in Section 4.2(a) above of its program of
                        development for obtaining said approvals.

                (c)     LICENSEE's failure to perform in accordance with
                        Sections 4.1 and 4.2 above shall be grounds for SKI to
                        terminate this Agreement pursuant to Section 13.4 below.

                              ARTICLE V - PAYMENTS

        5.1.    For the rights, privileges and licenses granted hereunder,
LICENSEE shall pay to SKI, in the manner hereinafter provided, until
termination of this Agreement:

                (a)     A license issue fee of fifty thousand dollars ($50,000),
                        payable immediately upon signing this Agreement.

                (b)     A royalty in an amount equal to five percent (5%) of the
                        Net Sales by LICENSEE or any sublicensee of the Licensed
                        Products or Licensed Processes, provided that such
                        Licensed Product or Licensed Process is covered by at
                        least one valid claim of an issued patent. In all other
                        cases, LICENSEE shall pay to SKI a royalty in the amount
                        of three percent (3%) of the Net Sales by LICENSEE or
                        any sublicensee of the Licensed Products or Licensed
                        Processes. In addition, LICENSEE shall pay SKI fifty
                        percent (50%) of income from sublicensees which is not
                        based on Net Sales, e.g. up-front licensing fees,
                        milestone payments.

                (c)     Milestone payments as follows: (i) $25,000 upon the
                        filing of an Investigative New Drug (IND) with the
                        United States Food and Drug Administration (FDA), or two
                        years after the Effective Date, whichever is earlier.
                        (ii) $ 75,000 upon commencement of Phase III clinical
                        studies, or five years months after the Effective Date,,
                        whichever is earlier. (iii) $100,000 upon filing of a
                        New Drug Application (NDA) with the FDA for each
                        Licensed Product or eight years after the Effective
                        Date, whichever is earlier. (iv) $300,000 upon receipt
                        of a New Drug Application (NDA)

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                        from the FDA for each Licensed Product for which
                        LICENSEE receives a NDA.

                (d)     Annual minimum royalty payments, starting two years
                        after the Execution Date, in the amount of ten thousand
                        dollars ($10,000) per Royalty Year pending issuance of a
                        U.S. Patent, and after issuance of one or more such
                        patents, annual minimum royalty payments of twenty
                        thousand dollars ($20,000) per Royalty Year, and after
                        the issuance of an NDA, annual minimal royalty payments
                        of fifty thousand dollars ($50,000). Such minimum
                        royalty payments shall be prorated for the year of
                        issuance. The minimum royalty payments shall be credited
                        against the earned royalty payments required in Section
                        5.1 (b) above for the same Royalty Year.

                (e)     Patent expenses according to the terms of Article VII.

        5.2.    No multiple royalties shall be payable because any Licensed
Product, its manufacture, use, lease or sale are or shall be covered by more
than one of the Patent Rights patent applications or Patent Rights patents
licensed under this Agreement.

        5.3.    Royalty payments shall be paid in United States dollars in New
York, NY, or at such other place as SKI may reasonably designate consistent with
the laws and regulations controlling in any foreign country, but not in any
other currency. 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 (N.A.) on the last business
day of the calendar quarterly reporting period to which such royalty payments

5.4.     Interest

        (a)     LICENSEE shall pay to SKI interest on any amounts not paid when
                due. Such interest will accrue from the fifteenth (15th) day
                after the payment was due at a rate two percent (2%) above the
                daily prime interest rate, as determined by The Chase Manhattan
                Bank (N.A.) or its successor entity, on each day the payment is
                delinquent, and the interest payment will be due and payable on
                the first day of each month after interest begins to accrue,
                until full payment of all amounts due SKI is made.

        (b)     SKI's rights to receive such interest payments shall be in
                addition to any other rights and remedies available to SKI.

        (c)     If the interest rate required in this Subsection exceeds the
                legal rate in a jurisdiction where a claim for such interest is
                being asserted, the required interest rate shall be reduced, for
                such claim only, to the maximum interest rate allowable in the

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                        ARTICLE VI - REPORTS AND RECORDS

        6.1.    LICENSEE shall keep full, true and accurate books of account
containing all particulars that may be necessary for the purpose of showing the
amounts payable to SKI hereunder. Said books and records shall be maintained for
a period of no less than five (5) years following the period to which they
pertain. For the term of this Agreement, upon reasonable written notice,
LICENSEE shall allow SKI or its agents to inspect such books and records for the
purpose of verifying LICENSEE's royalty statement or compliance in other
respects with this Agreement. Such inspections shall be during normal working
hours of LICENSEE. Should such inspection lead to the discovery of a greater
than ten percent (10%) discrepancy in reporting to SKI's detriment, LICENSEE
agrees to pay the full cost of such inspection.

        6.2.    LICENSEE, within thirty (30) days after March 31, June 30,
September 30 and December 31 of each year, shall deliver to SKI true and
accurate reports, giving such particulars of the business conducted by LICENSEE
and its sublicensees during the preceding three-month period under this
Agreement as shall be pertinent to a royalty accounting hereunder. These shall
include at least the following, to be itemized per Licensed Product and Licensed

                (a)     Number of Licensed Products and Licensed Processes
                        commercially used, manufactured and sold, rented or

                (b)     Total billings for Licensed Products and Licensed
                        Processes commercially used, sold, rented or leased.

                (c)     Deductions applicable as provided in Paragraph 1.7.

                (d)     Total royalties due.

                (e)     Names and addresses of all sublicensees of LICENSEE.

                (f)     Total royalty income from all revenues subject to
                        sublicensees' royalties.

                (g)     Total sublicensing fee income.

        6.3.    With each such report submitted, LICENSEE shall pay to SKI the
royalties due and payable under this Agreement. If no royalties shall be due,
LICENSEE shall so report.

        6.4.    Milestone payments shall be reported and paid when due.

                        ARTICLE VII - PATENT PROSECUTION

        7.1.    LICENSEE shall be responsible for and pay all past and future
costs and expenses incurred by SKI for the preparation, filing, prosecution,
issuance, and maintenance of the Patent Rights. Such payments will be due within
thirty (30) days of LICENSEE's receipt of invoice of patent expenses from SKI or
SKI's patent counsel.

        7.2.    SKI shall diligently prosecute and maintain the Patent Rights in
the United States and in such countries as are determined by SKI and agreed to
by LICENSEE, using counsel of its choice. If LICENSEE does not agree to bear the
expense of filing patent applications in any foreign countries in which SKI
wishes to obtain patent protection, then SKI may file and prosecute such
applications at its own expense and any license granted hereunder shall exclude
such countries.

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        7.3.    SKI shall provide LICENSEE with copies of all relevant
documentation so that LICENSEE may be informed and to give LICENSEE reasonable
opportunity to advise SKI of the continuing prosecution, and LICENSEE agrees to
keep this documentation confidential.

                          ARTICLE VIII - INFRINGEMENT

        8.1.    LICENSEE as the exclusive commercial user of the Patent Rights
shall assume primary responsibility for enforcing the Patent Rights within
relevant commercial markets in the Field of Use. In exercising these
responsibilities, LICENSEE shall promptly contact alleged third party infringers
and take all reasonable steps to persuade such third parties to desist from
infringing the Patent Rights, including initiating and prosecuting an
infringement action if necessary, or defending a challenge to the validity of
the Patent Rights. LICENSEE also shall notify SKI of each instance of alleged
infringement and shall keep SKI informed of all stages of Patent Rights
enforcement. LICENSEE may use the name of SKI as party plaintiff. All costs of
any action to enforce the Patent Rights taken by LICENSEE shall be borne by
LICENSEE and LICENSEE shall keep any recovery of damages derived therefrom, the
excess of such recovery over such costs shall be included in LICENSEE's Net
Sales. No settlement, consent judgment or other voluntary final disposition of
the suit may be entered into without the prior written consent of SKI, which
consent shall not unreasonably be withheld.

        8.2.    In the event LICENSEE becomes aware of unlicensed infringement
of the Patent Rights, either through notice from SKI or by other means, and does
not, within three months (a) secure cessation of the infringement; or (b) enter
suit against the infringer; or (c) provide SKI with evidence of pendency of a
bona fide negotiation for sublicensing the infringer, then, thirty days after
giving written notice to LICENSEE, SKI shall have the right to (a) sue for the
infringement at SKI's own expense, and to collect for its own use any damages,
profits and awards of whatever nature that it may recover for such infringement;
and (b) terminate this Agreement according to terms of Article XII.

        8.3.    Each party shall promptly notify the other in writing in the
event that a third party shall bring a claim of infringement against SKI or
LICENSEE, either in the United States or in any foreign country in which there
are Patent Rights.

        8.4.    In the event LICENSEE is sued for patent infringement,
threatened with such suit, or enjoined from exercising its license rights
granted hereunder, LICENSEE may terminate this Agreement according to Article
XII or contest the action against it. In any such action, LICENSEE shall be
fully responsible for all its costs, including expenses, judgements and
settlements, and shall be entitled to proceeds that it may recover, including
judgements, settlements and awards, the excess of such recovery over such costs
shall be included in LICENSEE's Net Sales.

        8.5.    In any infringement suit as either party may institute to
enforce the Patent Rights against third parties pursuant to this Agreement, or
in any infringement action brought against either party by a third party, each
party hereto shall, at the request and expense of the other party,

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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.


        9.1.    LICENSEE shall at all times during the term of this Agreement
and thereafter, indemnify, defend and hold SKI and its Affiliates, their Board
of Managers, officers, employees and affiliates, harmless against all claims and
expenses, including legal expenses and reasonable attorneys' fees, arising out
of the death of or injury to any person or persons or out of any damage to
property and against any other claim, proceeding, demand, expense and liability
of any kind whatsoever resulting from the production, manufacture, sale, use,
lease, consumption or advertisement of the Licensed Product(s) and/or Licensed
Process(es) or arising from any obligation of LICENSEE hereunder.

        9.2.    For the term of this Agreement, upon the commencement of
clinical use, production, sale, or transfer, whichever occurs first, of any
Licensed Product or Licensed Process, LICENSEE shall obtain and carry in full
force and effect general liability insurance which shall protect LICENSEE and
SKI in regard to events covered by Section 9.1 above. Such insurance shall be
written by a reputable insurance company, shall list SKI as an additional named
insured thereunder, shall be endorsed to include liability coverage, and shall
require thirty (30) days written notice to be given to SKI prior to any
cancellation or material change thereof. The limits of such insurance shall not
be less than one million dollars ($1,000,000) per occurrence with an annual
aggregate of three million dollars ($3,000,000) for personal injury, death or
property damage. LICENSEE shall provide SKI with Certificates of Insurance
evidencing the same.

        9.3.    Except as otherwise expressly set forth in this Agreement, SKI

                          ARTICLE X - EXPORT CONTROLS

        It is understood that SKI is subject to United States Laws and
regulations controlling the export of technical data, computer software,
laboratory prototypes and other commodities (including the Arms Export Control
Act, as amended and the Export Administration Act of 1979), and that its
obligations hereunder are contingent on compliance with applicable United States
export laws and regulations. The transfer of certain technical data and
commodities may require a license from the cognizant agency of the United States
Government and/or written assurances by LICENSEE that LICENSEE shall not export
data or commodities to certain foreign countries without prior approval of such
agency. SKI neither represents that a license shall not be required nor that, if
required, it shall be issued.

                         ARTICLE XI - NON-USE OF NAMES

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        LICENSEE shall not use the names of SKI or its Affiliates, nor any of
their employees, nor any adaptation thereof, in any advertising, promotional or
sales literature without prior written consent obtained from SKI in each case.

                            ARTICLE XII - ASSIGNMENT

        12.1.   This Agreement may not be assigned by LICENSEE without prior
written consent from SKI.

        12.2.   Notwithstanding the foregoing prohibition, LICENSEE may without
SKI's consent assign this Agreement to any entity that it may merge into,
consolidate with, or transfer substantially all of its assets ("substantially"
being EIGHTY PERCENT (80%) or more thereof) as an entirety, so long as the
successor surviving corporation in any such merger, consolidation, transfer or
reorganization assumes in writing the obligations of this Agreement. Such
merger, consolidation, transfer or reorganization shall not in itself be a
breach of this Article XI, nor be any default under this Agreement.

                           ARTICLE XIII - TERMINATION

        13.1.   Unless earlier terminated pursuant to this Article XII, this
Agreement shall terminate upon the later to occur of (a) the last to expire of
the Patent Rights or (b) twenty (20) years.

        13.2.   SKI may terminate this Agreement if LICENSEE becomes insolvent
or, a petition in bankruptcy is filed against LICENSEE and is consented to,
acquiesced in or remains undismissed for thirty (30) days; or makes a general
assignment for the benefit of creditors, or a receiver is appointed for
LICENSEE, and LICENSEE does not return to solvency before the expiration of a
thirty (30) day period.

        13.3.   Should LICENSEE fail to pay SKI license fees, royalties and
patent expenses due and payable hereunder for more than thirty (30) days, SKI
shall have the right to terminate this Agreement on thirty (30) days written
notice, unless LICENSEE shall pay SKI within the thirty (30) day period, all
such license fees, royalties and patent expenses and interest due and payable.
Upon the expiration of the thirty (30) day period, if LICENSEE shall not have
paid all such royalties, patent expenses and interest due and payable, the
rights, privileges and license granted hereunder shall terminate.

        13.4.   Upon failure of LICENSEE to perform in accordance with Article 4
or any other material breach of this Agreement by LICENSEE, other than those
occurrences set out in Sections 13.2 and 13.3, hereinabove, which shall always
take precedence in that order over any material breach or default referred to in
this Section 13.4, SKI shall have the right to terminate this Agreement and the
rights, privileges and license granted hereunder by sixty (60) days' notice to
LICENSEE. Such termination shall become effective unless LICENSEE shall have
cured any such breach prior to the expiration of the sixty (60) day period.

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        13.5.   LICENSEE shall be entitled to terminate this Agreement upon
sixty (60) days advance written notice to SKI, provided that LICENSEE and any of
its Affiliates or sublicensees cease making, using or selling Licensed Products.

        13.6.   Upon termination of this 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. LICENSEE must return to
SKI all materials [Know-How, biological, chemical, FDA files, etc] relating to
Licensed Product, Licensed Process, and the Patent Rights; provided, however,
that, unless terminated under Sections 13.3 or 13.4, LICENSEE shall have the
right for one year thereafter to dispose of all Licensed Products then in its
inventory, and shall pay royalties thereon, in accordance with the provisions of
Article IV and shall submit the related reports as required by Article V, as
though this Agreement had not terminated.

        13.7.   Other than any claim arising from LICENSEE's failure to pay
license fees or patent expenses due under this contract, any controversy or bona
fide disputed claim arising between the parties to this Agreement, which dispute
cannot be resolved by mutual agreement shall, by the election of either party,
be resolved by submitting to dispute resolution before a fact-finding mediation
body composed of one or more experts in the field, selected by mutual agreement
within thirty days of written request by either party. Said dispute resolution
shall be held in New York at such place as shall be mutually agreed upon in
writing by the parties. The fact-finding body shall determine who shall bear the
cost of said resolution. In the event that the parties cannot mutually agree
within said thirty (30) days on the dispute resolution body, the parties will go
to arbitration in accordance with the Commercial Arbitration Rules of the
American Arbitration Association.

        13.8.   Upon termination of this Agreement for any reason all
sublicenses shall terminate. Any sublicensees not then in default shall have the
right to seek a license from SKI. SKI agrees to negotiate such licenses in good
faith under reasonable terms and conditions substantially similar to the ones
set forth in the License agreement between Celsion and such sublicensee or as
set forth in this Agreement, at the discretion of SKI.

        13.9.   Article IX, Article XI, and Section 13.6 of this Agreement shall
survive termination.


        14.1.   Payments shall be made by remittance to "Sloan-Kettering
Institute for Cancer Research". Payments shall be sufficiently made when
delivered by courier of other means providing proof of delivery to SKI. Payment
shall show "PAYMENT, CONTRACT SK# 4826" on the check stub or attached
correspondence, and shall be sent to:

                           Office of Industrial Affairs
                           Memorial Sloan-Kettering Cancer Center
                           1275 York Avenue

                                     - 13 -
<PAGE>   14

                           New York, New York 10021

        14.2.   All notices or other communication pursuant to this Agreement
shall be sufficiently made or given when delivered by courier or other means
providing proof of delivery to such party at its address below or as it shall
designate by written notice given to the other party:

                In the case of SKI:

                           Sloan-Kettering Institute for Cancer Research
                           1275 York Avenue
                           New York, New York 10021
                           Attention: James S. Quirk
                           Senior Vice President
                           Research Resources Management

                In the case of LICENSEE:

                           Celsion Corporation
                           10220-1 Old Columbia Road
                           Columbia, MD 21046-1705
                           Attention: Augustine Y. Cheung, Ph.D.


        15.1.   This Agreement shall be construed, governed, interpreted and
applied in accordance with the laws of the State of New York, except that
questions affecting the construction and effect of any patent shall be
determined by the law of the country in which the patent was granted.

        15.2.   The provisions of this Agreement are severable, and in the event
that any provisions of this Agreement shall be determined to be invalid or
unenforceable under any controlling body of the law, such invalidity or
unenforceability shall not in any way affect the validity or enforceability of
the remaining provisions hereof.

        15.3.   LICENSEE 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.

        15.4.   The failure of either party to assert a right hereunder or to
insist upon compliance with any term or condition of this 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.

                                     - 14 -
<PAGE>   15

        15.5.   This Agreement may be executed in any number of counterparts and
each of such counterparts shall for all purposes be an original and all such
counterparts shall together constitute but one and the same agreement.

        IN WITNESS WHEREOF, authorized representatives of the parties have
signed and dated this Agreement below.

Sloan-Kettering Institute for Cancer Research      Celsion Corporation

By:    /s/ MR. GUSTAVE J. BERNHARDT                By: /s/ AUGUSTINE Y. CHEUNG, PH.D.
       ------------------------------------            --------------------------------------
       James S. Quirk                                  Augustine Y. Cheung, Ph.D.
       Senior Vice President                           Chairman
       Research Resources Management

Date: 5/19/00                                      Date: 5/17/2000
     --------------------------------------             -------------------------------------

                                     - 15 -
<PAGE>   16

                                    EXHIBIT A

PCT International Application No. PCT/US99/14702 entitled "Uses of DNA-PK filed
June 30, 1999, claiming the benefit of U.S. Provisional Application No.
60/091,181 filed June 30, 1998.

                                    - 16 -
<PAGE>   17

                                    EXHIBIT B

  Project Summary

        DNA-PK and Heat-Shock Targeted (Adenoviral) Genetic Radiotherapy

                               Gloria C. Li, Ph.D.

       Department of Medical Physics and Department of Radiation Oncology
                         Memorial Sloan-Kettering Cancer Center
                         1275 York Avenue, New York, NY 10021

        Ku is a complex of two proteins, Ku70 and Ku80, that functions as a
        heterodimer to bind DNA double-strand breaks and activate DNA-dependent
        protein kinase (DNA-PK). To determine the physiological roles of Ku70
        and Ku80, we generated Ku70-/- and Ku80-/- knockout mice via targeted
        gene disruption (Nussenzweig, et al., 1996, Ouyang, et al., 1997). These
        mutant mice show profound deficiency in V(D)J recombination, impaired
        lymphocyte development, and inability to rejoin the radiation-induced
        DNA double strand breaks. To further characterize the Ku-deficieny
        associated phenoptype, mouse embryo fibroblast cell lines were
        established from these Ku70-/- and Ku80-/- mice, and were tested for
        their sensitivity to DNA-damaging agents. Ku70-/- and Ku80-/- cells were
        extremely sensitive to ionizing radiation, deficient in the recovery of
        sublethal and potentially lethal damage. Furthermore, these cells were
        also sensitive to other DNA-damaging agents such as adriamycin,
        bleomycin, and etoposide. We have performed complementation experiments
        and show that expression of human Ku70 in Ku70-/- cells (and human Ku80
        in Ku80-/- cells) restored their Ku-DNA binding activity and x-ray
        resistance phenotype. These results confirm that Kudeficiency
        compromises the ability of cells to repair DNA strand breaks, presumably
        by inhibiting the function of DNA-PK.

        Three specific aims are proposed in this grant application to test a
        working hypothesis, inferred from our pilot studies described above,
        that DNA-PK plays an important role in modulating the response of human
        cancer cells to ionizing radiation and to chemotherapeutic agents.
        Specifically, we plan to down-regulate the DNA-PK activity by either
        genetic approach (via expression of antisense RNA targeting DNA-PK
        subunits) or pharmacological means (with the use of DNA-PK inhibitors),
        and to determine whether the reduction of DNA-PK activity will enhance
        the cytotoxicity of various drugs and ionizing radiation. Knowledge
        gained in these investigations will lead to strategies for optimizing
        the efficacy of chemotherapy, radiation and hyperthermia therapy in the
        management of human cancer, which constitutes the goals of this

                                    - 17 -

<PAGE>   18


Using established cell lines deficient in DNA-PKcs or Ku70 or Ku80, in
comparison with their wild-type controls, we will determine:

(a)     the cell's sensitivity to various chemotherapeutic drugs, e.g.,
        cisplatin and doxorubicin.

(b)     the cells' sensitivity to ionizing radiation.

(c)     the cells' sensitivity to hyperthermia treatment.


To modify the cellular level of individual DNA-PK subunits through the use of
DNA-mediated gene transfer techniques, or through pharmacological means.
Specifically, we plan:

(a)     To generate and characterize cell lines stably and constitutively
        expressing antisense RNA targeting each of the DNA-PK subunits (e.g.,
        DNA-PKcs, Ku70 or Ku80) in order to down-regulate the endogenous level
        of DNA-PKcs, Ku70 or Ku80. Expression of DNA-PK subunit will be
        determined by Northern and Western blot analysis, and further examined
        using DNA-PK kinase activity assay.

(b)     To place the Ku70, Ku80 or DNA-PKcs gene fragment in the antisense
        orientation and under the control of a heat-shock responsive promoter
        (e.g., hsp70 promoter), to transfect these gene constructs into
        mammalian cells, and to determine the heat inducibility (the efficiency
        of the promoter), the residual level of DNA-PK subunit (in terms of
        expression, kinase activity, and DNA-binding activity).

(c)     Using cell lines generated in II-(a) and II-(b), in which DNA-PK
        activity is modified, in comparison to control cells, we plan to
        determine the cells' sensitivity to ionizing radiation, to
        chemotherapeutic drugs and to heat shock exposure.

(d)     An additional approach to modify the cellular level of DNA-PK is to use
        DNA-PK kinase inhibitor to reduce the endogenous level of DNA-PK
        activity in cells.


To verify cell culture studies listed in Specific Aim II in animal tumor models.
Specifically, we plan:

(a)     To deplete the cellular level of individual DNA-PK subunits in animal
        tumors (e.g. MCF-7 tumors implanted in nude mice, or FSa-II
        fibrosarcomas implanted in C3H mice), by intratumoral injection of an
        adenoviral vector containing the heat-shock inducible hsp70

                                    - 18 -
<PAGE>   19

        promoter (or a constitutive CMV promoter), ligated to the antisense Ku70
        cDNA (asKu70), the antisense Ku80 cDNA (asKu80) or the antisense
        DNA-PKcs cDNA (asDNA-PKcs).

(b)     To regionally heat shock the tumors (to activate the hsp70 promoter and
        antisense expression) and followed by radiation therapy. The radiation
        response of these animal tumors and human xenografts will be assessed in
        vitro (colony forming assay) and/or in vivo (tumor growth assay).

Budget & Payment Schedule

$111,645.00 per year for a period of two (2) years, payable semi-annually, in
advance, in four equal payments of $55,822.50. The first such payment will be
due upon execution of this Agreement. Subsequent payments will be made 6 months,
12 months and 18 months thereafter.

                                    - 19 -
<PAGE>   20

                 Detailed budget for Celsion Sponsored Research

PERIOD - DIRECT COSTS                                         From                      Through
ONLY                                                          6/1/00                    5/31/00

                                                           Type Appt.         % Effort on
          Name                  Role on Project             (months)            Project
Gloria C. Li               Principal Investigator              12                   5
Ling Bo Shen               Technician                          12                  30
Rachel Shao                Post-Doc Fellow                     12                 100

          Name             Salary Requested        Benefits             Totals
Gloria C. Li                         $0                  $0                  $0
Ling Bo Shen                     $9,000              $1,980             $10,980
Rachel Shao                     $35,000              $7,700             $42,700
                                $44,000              $9,680             $53,680

tissue culture                $5,000          chemicals                   $2,000
serum                         $5,000          antibodies                  $3,000
media                         $5,000          oligonucleotides            $1,000
antibotics                      $500          mice & housing             $10,000                      $31,500

NEW BUDGET PERIOD                                                                                     $85,180

OVERHEAD AT 62.3%                           (excludes Post-Doc)                                       $26,465

TOTAL COSTS FOR NEXT BUDGET PERIOD                                                                   $111,645

                                    - 20 -
<PAGE>   21

                                  May 17, 2000


         In my absence, Mr. Gustave J. Bernhardt, Director, Research Resources
Management, will sign as an institutional official for the Sloan-Kettering
Institute for Cancer Research.

                                   /s/ JAMES S. QUIRK
                                   James S. Quirk
                                   Senior Vice President