CONFIDENTIAL
TREATMENT REQUESTED
Exhibit
10.7
EXCLUSIVE
LICENSE AGREEMENT
THIS
AGREEMENT (“Agreement”) by and among DR.
CESARE CASAGRANDE, having
an
address at Via Campogallo, 21/67, 20020 Arese, Milan, Italy and NILE
THERAPEUTICS, INC., a corporation organized and existing under the laws of
the
State of Delaware, with principal offices located at 2850 Telegraph Avenue,
Suite 310, Berkeley, CA 94705 (“LICENSEE”) is effective as of the date of final
execution below (“EFFECTIVE DATE”).
ARTICLE
1 BACKGROUND
1.1. In
the
course of research conducted by the LICENSOR (as defined below), the LICENSOR
has produced certain inventions referred to a medicinal product designated
as
2-NTX-99 (the “INVENTION”), which is owned by the LICENSOR and described in the
LICENSED PATENTS (as defined below).
1.2. The
LICENSOR and LICENSEE wish to have the INVENTION and any LICENSED
PATENTS
(as
defined below) developed and commercialized.
1.3. LICENSEE
has represented to LICENSOR in order to induce LICENSOR to enter into this
Agreement that it is experienced in developing and commercializing products
similar to the LICENSED PRODUCTS (as defined below) and that it shall act
diligently to develop and commercialize the LICENSED PRODUCTS for public
use
throughout the LICENSED TERRITORY (as defined below).
1.4. The
LICENSOR is willing to grant a license to LICENSEE, subject to the terms
and
conditions of this Agreement.
1.5. In
consideration of these statements and the mutual promises
herein
made and exchanged, and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged,
the
LICENSOR and LICENSEE agree to the terms of this Agreement.
ARTICLE
2 DEFINITIONS
The
following terms used in this Agreement shall be defined as set forth
below:
2.1. “AFFILIATE”
shall mean any entity or person that directly or indirectly controls, is
controlled by or is under common control with LICENSEE or a SUBLICENSEE as
applicable. For purposes of this definition, “control” means possession of the
power to direct the management of such entity or person, whether through
ownership of more than fifty percent (50%) of voting securities, by contract
or
otherwise.
____________
1 Confidential
treatment has been requested for certain portions of this Exhibit. The
confidential portions of this Exhibit have been omitted and filed separately
with the Securities and Exchange Commission. Such portions have been marked
with
“***” at the exact place where material has been
omitted.
2.2. “CHANGE
OF CONTROL” shall mean a merger, consolidation, acquisition or the transfer of
all, or substantially all, of the business interests of LICENSEE to which
this
Agreement relates to which LICENSEE is a party where the shareholders of
LICENSEE immediately prior to effective date of such transaction beneficially
own, immediately following the effective date of such transaction, securities
representing less than fifty percent (50%) of the combined voting power
of the
surviving corporation’s then outstanding voting securities.
2.3. “COMMON
STOCK” shall mean the shares of common stock of the LICNESEE, par value $0.001
per share.
2.4. “CONFIDENTIAL
INFORMATION” shall mean all information disclosed by one party to the other
during the negotiation of or under this Agreement in any manner, whether
orally,
visually or in tangible form, that relates to LICENSED PATENTS, LICENSED
INFORMATION, IMPROVEMENT PROJECT or the Agreement itself, unless such
information is subject to an exception described in Article 9.2.
CONFIDENTIAL INFORMATION that is disclosed in tangible form shall be marked
“Confidential” at the time of disclosure and CONFIDENTIAL INFORMATION that is
disclosed orally or visually shall be identified as confidential at the time
of
disclosure and subsequently reduced to writing, marked confidential and
delivered to the other party within thirty (30) days of such disclosure.
2.5. “EARNED
ROYALTY” is defined in Article 7.1.
2.6. “EFFECTIVE
DATE” is defined in the introductory paragraph of this Agreement.
2.7. “EMEA”
shall mean the European Medicines Agency or successor entity.
2.8. “EUROPEAN
UNION” shall mean the European organisation of member states first established
by the Treaty of the European Union in 1992 (otherwise known as the Maastricht
Treaty) as it may be constituted from time to time, which, as of the date
of
this Agreement, consists of Austria, Belgium, Bulgaria, Cyprus, Czech Republic,
Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy,
Latvia, Lithuania, Luxembourg, Malta, The Netherlands, Poland, Portugal,
Romania, Slovakia, Slovenia, Spain, Sweden and the United Kingdom.
2.9. “FAIR
MARKET VALUE” shall mean the last sale price of the COMMON STOCK on the trading
day on which the value is being determined or, in case no such reported sales
take place on such day, the average of the last reported bid and asked prices
of
the COMMON STOCK on such day, in either case on the principal national
securities exchange on which the COMMON STOCK is admitted to trading or listed,
or if not listed or admitted to trading on any such exchange, the representative
closing sale price of the COMMON STOCK as reported by the National Association
of Securities Dealers, Inc. Automated Quotations System ("NASDAQ"), or other
similar organization if NASDAQ is no longer reporting such information, or,
if
the COMMON STOCK is not reported on NASDAQ, the per share sale price for
the
COMMON STOCK in the over-the-counter market as reported by the National
Quotation Bureau or similar organization, or if not so available, the fair
market value of the COMMON STOCK as determined by the price per share in
the
most recent private financing round wherein (a) the total shares in the
financing represent no less than five percent (5%) of the COMMON STOCK following
such financing, and (b) greater than fifty percent (50%) of the shares were
purchased by parties unaffiliated with LICENSEE management or directors.
2.10. “FDA”
shall mean the United States Food and Drug Administration or successor entity.
2.11. “FIELD”
shall mean all therapeutic uses in humans and animals.
2.12. “FIRST
SALE” shall mean the first commercial sale to a third party of any LICENSED
PRODUCT in the LICENSED TERRITORY (as defined below).
2.13. “IMPROVEMENT
PROJECT” shall mean any and all projects conceived by the LICENSOR intended to
find and/or develop any novel intellectual property relating to the LICENSED
PRODUCTS, including, without limitation, improved methods of manufacture
and
production techniques, new or additional analogs, therapeutic indications
and
developments intended to enhance the safety and efficacy, or broaden the
intended use of the LICENSED PRODUCTS.
2.14. “IND”
shall mean an investigational new drug application filed with the FDA prior
to
the commencement of human clinical trials in the United States.
2.15. “INVENTION”
is defined in Article 1.1.
2.16. “LICENSE”
refers to the license granted under Article 3.1.
2.17. “LICENSED
INFORMATION” shall mean all technical information and data, whether or not
patented, that is known , learned, invented, or developed by the LICENSOR
as of
the EFFECTIVE DATE, as demonstrated by the written records of the LICENSOR
to
the extent that:
(a) such
technical skills, information and data are useful for the use or practice
of the
LICENSED PATENTS as permitted herein; and
(b) the
LICENSOR possess the right to license the use of such information to LICENSEE
for commercial purposes under the terms of this Agreement.
2.18. “LICENSED
PATENTS” shall mean the United States or foreign patent application(s) and
patents(s) listed in Appendix
A
owned or
assigned to LICENSOR during the term of this Agreement, together with any
continuations, divisionals, and continuations-in-part, to the extent the
claims
of any such patent or patent application are directed to subject matter
specifically described in the patent applications listed on Appendix
A;
any
reissues, re-examinations, or extensions thereof, or substitutes therefore;
and
the relevant international equivalents of any of the foregoing. Appendix
A
is
incorporated into this Agreement. LICENSED PATENTS shall also include any
results of the IMPROVEMENT PROJECTS added to the LICENSE pursuant to Article
3.2.
2.19. “LICENSED
PRODUCTS” shall mean any product, apparatus, kit, or component part
thereof;
(a) the
manufacture, use or sale of which without a license from LICENSOR, would
infringe a VALID CLAIM of a LICENSED PATENT;
(b) incorporates,
uses, or is derived from the LICENSED PATENTS; or
(c) is
developed by using a process or composition which is covered in whole or
in part
by a VALID CLAIM of a LICENSED PATENT.
2.20. “LICENSED
TERRITORY” shall mean the entire world.
2.21. “MAJOR
MARKET COUNTRY” shall mean Canada, the United Kingdom, France, Germany, Spain,
Italy, or Japan.
2.22. “LICENSOR”
shall mean Dr. Cesare Casagrande or any immediate family member of Dr.
Casagrande, or any trust, all of the beneficiaries of which are such Dr.
Casagrande or his immediate family members, or the guardian, conservator,
heir
or estate of Dr. Casagrande, or any corporation, partnership, limited liability
company or other entity all or substantially all of the outstanding securities
and other beneficial interests of which are owned by Dr. Casagrande or his
immediate family members.
2.23. “NDA”
shall mean a new drug application filed with the FDA to obtain marketing
approval for a LICENSED PRODUCT in the United States.
2.24. “NET
SALES” shall mean:
(a) the
total
gross receipts from the
sale,
leasing,
renting
of,
or
otherwise making LICENSED
PRODUCTS available
by
the
LICENSEE, SUBLICENSEES or AFFILIATES to THIRD PARTIES (defined
below)
for
profit without sale or other dispositions, whether invoiced or not, less
the
following deductions, provided they actually pertain to the disposition of
LICENSED PRODUCTS and are separately invoiced:
(i) all
reasonable and customary discounts, returns, credits and allowances on account
of returns, bad debt deductions actually written off during the calendar
quarter
in which sales occurred, provided, however, that deductions taken for bad
debt
shall not exceed in aggregate one percent (1.0%) of gross sales of LICENSED
PRODUCT during the calendar quarter;
(ii) reasonable
and customary arms length negotiated commissions actually paid to independent
and unaffiliated third-party distributors and third party sales agencies
not to
exceed in aggregate one and one quarter percent (1.25%) per calendar
quarter;
(iii) reasonable
and customary outbound transportation and transportation insurance, packaging
(for shipping purposes only) and freight charges; and
(iv) reasonable
and customary duties, taxes (but not income taxes) and other governmental
charges levied on the sale, transportation or delivery of LICENSED PRODUCTS,
but
not including income taxes of the LICENSEE.
(b) No
deductions shall be made for any other costs or expenses, including but not
limited to commissions to any person or entity on LICENSEE’S, SUBLICENSEE'S or
an AFFILIATE’S payroll or for the cost of collection.
(c) Notwithstanding
any provision in this Agreement to the contrary, NET SALES shall not include
the
gross invoice price for LICENSED PRODUCTS sold to, or services performed
using
LICENSED PRODUCTS for, any AFFILIATE unless such AFFILIATE is an end-user
of any
LICENSED PRODUCT, in which case that transaction shall be included in NET
SALES
at the average selling price charged to a THIRD-PARTY (as defined below)
during
the same quarter.
2.25. “PHASE
I
CLINICAL TRIAL” shall mean a human clinical trial, the principal purpose of
which is to determine toxicity, absorption, metabolism and/or safe dosage
range
in patients with the disease target being studied as required in 21 C.F.R.
§312(a).
2.26. “PHASE
II
CLINICAL TRIAL” shall mean a human clinical trial, the principal purpose of
which is to evaluate the effectiveness of a drug for a particular indication
in
patients with the disease and to determine the common short-term side effects
and risks associated with the drug as required in 21 C.F.R. §312(b).
2.27. “PHASE
III CLINICAL TRIAL” shall mean expanded controlled and uncontrolled human
clinical trials pursuant to a randomized study with endpoints agreed upon
by
regulatory bodies for regulatory approval performed after PHASE II CLINICAL
TRIALS evidence suggesting effectiveness of a LICENSED PRODUCT has been
obtained, and is intended to gather the additional information about
effectiveness and safety that is needed to evaluate the overall benefit-risk
relationship of a LICENSED PRODUCT and to provide an adequate basis for
physician labeling, as required in 21 C.F.R. §312.
2.28. “PMA”
shall mean an application for marketing authorization of a LICENSED PRODUCT
filed with the EMEA.
2.29. “REASONABLE
COMMERCIAL EFFORTS” shall mean those efforts consistent with those used by
comparable companies in the United States in research and development projects
for therapeutic methods or compositions deemed to have commercial value
comparable to the LICENSED PRODUCTS.
2.30. “SUBLICENSING
ROYALTIES” shall mean royalty consideration received by LICENSEE as a result of
NET SALES of LICENSED PRODUCTS by a SUBLICENSEE.
2.31. “SUBLICENSEE”
shall mean any third party sublicensed by LICENSEE to make, have made, use,
sell, have sold, import or export any LICENSED PRODUCT.
2.32. “TERM”
is
defined in Article 3.2.
2.33. “THIRD
PARTY(IES)” shall mean any person or entity that is not party to this Agreement
but does not include SUBLICENSEES or any AFFILIATE of LICENSEE or any
SUBLICENSEE under the terms herein.
2.34. “VALID
CLAIM” shall mean an issued claim of any unexpired patent included among the
PATENT RIGHTS, which has not been held unenforceable, unpatentable or invalid
by
a decision of a court or governmental body of competent jurisdiction,
unappealable or unappealed within the time allowed for appeal, which has
not
been rendered unenforceable through disclaimer or otherwise, and which has
not
been lost through an interference proceeding or abandoned.
ARTICLE
3 LICENSE
GRANT AND TERM
3.1. Subject
to all the terms and conditions of this Agreement, the LICENSOR hereby grants
to
LICENSEE an exclusive license to practice under the LICENSED PATENTS and
use the
LICENSED INFORMATION, with the right to grant sublicenses, to make, have
made,
use, sell, have sold, offer to sell, import or export LICENSED PRODUCTS within
the FIELD in the LICENSED TERRITORY (the “LICENSE”).
3.2. LICENSOR
grants to LICENSEE a right of first refusal to financially support any
IMPROVEMENT PROJECT and to include the results of any such IMPROVEMENT PROJECT
under the terms of this Agreement as LICENSED PATENTS or LICENSED INFORMATION.
LICENSOR shall disclose any proposed IMPROVEMENT PROJECT to LICENSEE in writing
prior to disclosing to any THIRD PARTIES. Following such written disclosure
to
LICENSEE, LICENSEE shall have ninety (90) days to determine its interest
in
financially supporting such IMPROVEMENT PROJECT. In the event that LICENSEE
desires to financially support the IMPROVEMENT PROJECT, LICENSEE shall inform
LICENSOR in writing and the parties shall negotiate in good faith the terms
and
conditions of a sponsored research agreement upon commercially reasonable
terms.
In the event that LICENSEE determines not to financially support such
IMPROVEMENT PROJECT, or if the parties are unable to agree upon commercial
terms, then LICENSOR shall be free to negotiate with a THIRD PARTY relating
to
the funding of such IMPROVEMENT PROJECT, provided however, that the LICENSOR
may
not enter into an agreement with a THIRD PARTYon terms more favorable to
such
THIRD PARTY than those proposed by LICENSOR to LICENSEE.
Nothing
in this Agreement shall be construed as a license, sublicense or grant to
such
THIRD PARTY of rights to the LICENSED PATENTS or LICENSED INFORMATION,
or as
an exception to the rights granted pursuant to Section 3.1
of this
Agreement.
3.3. Unless
terminated earlier as provided in ARTICLE
15,
the
term of the LICENSE (the “TERM”) shall commence on the EFFECTIVE DATE and shall
automatically expire on the later of:
(a) the
date
on which the last VALID CLAIM described in the LICENSED PATENTS expires,
lapses
or is declared to be invalid by a non-appealable decision of a court of
competent jurisdiction; or
(b) twenty
(20) years after the EFFECTIVE DATE.
3.4. Nothing
in this Agreement shall be construed to grant by implication, estoppel or
otherwise any licenses under patents of the LICENSOR other than the LICENSED
PATENTS. Except as expressly provided in this Agreement, under no circumstances
will the LICENSEE, as a result of this Agreement, obtain any interest in
or any
other right to any technology, know-how, patents, patent applications, materials
or other intellectual or proprietary property of the LICENSOR. Subject to
Article 14.1, nothing in this Agreement shall be construed as preventing
LICENSOR from using the LICENSED PATENTS and the LICENSED INFORMATION for
academic research and non-commercial purposes.
3.5. The
LICENSE granted in Article 3.1
shall
automatically convert to a paid-up, non-exclusive license, on a
country-by-country basis, upon the expiration of the TERM as described in
Article 3.3.
3.6. Articles
2, 6.2(b), 9, 10.2, 13, 15, 16, 18, and 20 shall survive expiration of this
Agreement pursuant to Article 3.2 or termination pursuant to ARTICLE
15.
ARTICLE
4 SUBLICENSES
4.1. The
LICENSOR hereby grants to the LICENSEE the right to sublicense its right
to
make, have made, use, sell, have sold, import or export LICENSED PRODUCTS
within
the FIELD in the LICENSED TERRITORY following the dosing of the first subject
in
a PHASE I CLINICAL TRIAL of a LICENSED PRODUCT, provided this Agreement is
in
effect and the LICENSEE is not in breach of its obligations
hereunder.
4.2. Any
sublicense granted by LICENSEE shall comply with all the terms of this LICENSE
and shall include substantially the same definitions and provisions set forth
in
the following Articles of this Agreement ARTICLES 2, 3, 8, 10.2, 13, 16 and
18.
LICENSEE shall require any SUBLICENSEE to actively pursue the achievement
of a
proof of concept in humans in U.S. and/or in the EUROPEAN UNION. Any agreement
between the LICENSEE and any SUBLICENSEE (a “SUBLICENSE
AGREEMENT”)
shall
expressly provide that the provisions of this Agreement shall be directly
enforceable against such SUBLICENSEE by the LICENSOR. LICENSEE will promptly
provide the LICENSOR with a copy of each SUBLICENSE AGREEMENT no later than
30
days after execution.
4.3. The
LICENSEE agrees that it shall promptly:
(a) provide
the LICENSOR with a copy of any amendments to any SUBLICENSE AGREEMENT entered
into by the LICENSEE under this Agreement and to notify the LICENSOR of
termination of any SUBLICENSE AGREEMENT; and
(b)
deliver
copies of all reports provided to the LICENSEE by SUBLICENSEES of a similar
nature to those described in ARTICLE
10;
(c) exert
its
best efforts in order to cause the SUBLICENSEES to perform the obligations
provided for in the SUBLICENSE AGREEMENTS.
ARTICLE
5 LICENSE
FEE AND MILESTONE PAYMENTS
5.1. The
LICENSEE shall pay to LICENSOR, on the EFFECTIVE DATE, a non refundable license
fee equal to [***].
5.2. The
LICENSEE shall also pay to LICENSOR on the EFFECTIVE DATE
the
amount of [***]
for past
patent expenses incurred by the LICENSOR
prior to
EFFECTIVE DATE as required under ARTICLE 11.
5.3. The
LICENSEE shall pay the following one-time non-refundable milestone payments
(the
“MILESTONE PAYMETS”) to LICENSOR, whether accomplished by the LICENSEE, a
SUBLICENSEE or any of their respective AFFILIATES:
(a) [***]
upon the dosing of the first subject in the first PHASE I CLINICAL TRIAL
of a
LICENSED PRODUCT in the United States conducted by the LICENSEE pursuant
to a
corporate sponsored IND;
(b) [***]
upon the dosing of the first subject in the first PHASE I CLINICAL TRIAL
(or its
foreign equivalent) of a LICENSED PRODUCT conducted by the LICENSEE in the
EUROPEAN UNION;
(c) [***]
upon the dosing of the first patient in the first PHASE II CLINICAL TRIAL
of a
LICENSED PRODUCT conducted by the LICENSEE in the United States;
(d) [***]
upon the dosing of the first subject in the first PHASE II CLINICAL TRIAL
(or
its foreign equivalent) of a LICENSED PRODUCT conducted by the LICENSEE in
the
EUROPEAN UNION;
(e) [***]
upon the dosing of the first patient in the first PHASE III CLINICAL TRIAL
of a
LICENSED PRODUCT conducted by the LICENSEE in the United States;
(f) [***]
upon the dosing of the first subject in the first PHASE III CLINICAL TRIAL
(or
its foreign equivalent) of a LICENSED PRODUCT conducted by the LICENSEE in
the
EUROPEAN UNION;
(g) [***]
upon the approval by the FDA of the first NDA for a LICENSED
PRODUCT;
(h) [***]
upon approval by the FDA of an NDA for a second human therapeutic indication
of
the LICENSED PRODUCT described in 5.3(g);
(i) [***]
upon the approval by the EMEA of the first PMA submitted by the LICENSEE
resulting in the granting of a marketing authorization for a LICENSED
PRODUCT;
(j) [***]
upon the approval by the EMEA of the first PMA submitted by the LICENSEE
resulting in the granting of a marketing authorization for a LICENSED PRODUCT
for a second human therapeutic indication than the one described in 5.3(i);
(k) [***]
upon receipt by the LICENSEE of marketing approval in Japan for the first
LICENSED PRODUCT;
(l) [***]
following the first calendar year in which annual NET SALES of LICENSED PRODUCTS
equal Two Hundred Fifty Million Dollars ($250,000,000.00);
(m) [***]
following the first calendar year in which annual NET SALES of LICENSED PRODUCTS
equal Five Hundred Million Dollars ($500,000,000.00); and
(n) [***]
following the first calendar year in which annual NET SALES of LICENSED PRODUCTS
equal One Billion Dollars ($1,000,000,000.00).
5.4. No
MILESTONE
PAYMENT
shall be
paid more than once for any LICENSED PRODUCT. In the event that the LICENSEE
is
permitted to advance the clinical development by the FDA or EMEA without
conducting one or more activities described in Article 5.3
above,
then the LICENSEE shall pay to the LICENSOR all milestone payments owed pursuant
to Article 5.3
that
would otherwise have been paid to the LICENSOR had the LICENSEE been required
to
conduct such activity. By way of example, if the EMEA permits the LICENSEE
to
commence PHASE III CLINICAL TRIALS in the EUROPEAN UNION without first
conducting a PHASE II CLINICAL TRIAL in the EUROPEAN UNION, then the LICENSEE
will immediately pay to the LICENSOR the amount owed pursuant to Article
5.3(d).
5.5. The
LICENSEE shall promptly notify the LICENSOR as soon as each of the milestones
described in Article 5.3
has been
achieved, whether it is achieved by the LICENSEE, a SUBLICENSEE or any of
their
respective AFFILIATES.
5.6. Article
7.4 shall apply to MILESTONES PAYMENTS.
ARTICLE
6 EQUITY
6.1. Upon
the
EFFECTIVE DATE, LICENSEE shall issue to LICENSOR a number of shares of COMMON
STOCK having a FAIR MARKET VALUE as of the EFFECTIVE DATE equal to One Million
Dollars ($1,000,000.00). LICENSEE shall deliver, or caused to be delivered,
to
LICENSOR a stock certificate, duly signed by appropriate officers of LICENSEE
and issued in LICENSOR’S name, representing all of the shares of COMMON STOCK
required to be issued to LICENSOR under this Article 6.1.
6.2. By
accepting the shares of COMMON STOCK, the LICENSOR hereby:
(a) consents
to the placement of a legend on any certificate or other document evidencing
the
shares of COMMON STOCK that such shares of COMMON STOCK have not been registered
under the Securities Act of 1933 or any state securities or “blue sky” laws and
setting forth or referring to the restrictions on transferability and sale
thereof contained in this Agreement. The LICENSOR is aware that the LICENSEE
will make a notation in its appropriate records with respect to the restrictions
on the transferability of such shares of COMMON STOCK. The legend to be placed
on each certificate shall be in form substantially similar to the
following:
"THE
SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") OR ANY STATE SECURITIES OR
"BLUE
SKY LAWS", AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, ASSIGNED, PLEDGED OR
HYPOTHECATED ABSENT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR
COMPLIANCE WITH RULE 144 PROMULGATED UNDER SUCH ACT, OR UNLESS THE COMPANY
HAS
RECEIVED AN OPINION OF COUNSEL, REASONABLY SATISFACTORY TO THE COMPANY AND
ITS
COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED."
(b) agrees
it
will not, without the prior written consent of the LICESEE, offer, pledge,
sell,
contract to sell, grant any option for the sale of, or otherwise dispose
of,
directly or indirectly, the shares of COMMON STOCK for a period of 180 days
following the initial public offering of the COMMON STOCK of the LICENSEE.
In
order to enforce the foregoing covenant, the LICENSEE may impose stop-transfer
instructions with re-spect to the shares of COMMON STOCK until the end of
such
period.
ARTICLE
7 EARNED
ROYALTIES
7.1. Subject
to provisions of this ARTICLE
7,
during
the TERM of this Agreement, as partial consideration for the LICENSE, LICENSEE
shall pay to LICENSOR an earned royalty on worldwide cumulative NET SALES
of
LICENSED PRODUCTS by LICENSEE or its AFFILIATES (“EARNED ROYALTIES”) determined
as a percentage of NET SALES by LICENSEE or its AFFILIATES as set forth
below:
|
ANNUAL
NET SALES
|
|
ROYALTY
|
|
$0
to $250,000,000
|
|
[***]
|
|
$250,000,001
to $500,000,000
|
|
[***]
|
|
$500,000,001
and above
|
|
[***]
|
7.2. In
the
event that the LICENSEE enters into a SUBLICENCE AGREEMENT during the TERM
of
this Agreement, LICENSEE shall pay to LICENSOR the greater of:
(a) [***]
of
the SUBLICENSING ROYALTIES received by the LICENSEE from a SUBLICENSEE;
and
(b) [***]
of
the NET SALES by such SUBLICENSEE.
7.3. LICENSEE
shall pay all EARNED ROYALTIES accruing to the LICENSOR within thirty (30)
days
from the end of each calendar quarter (March 31, June 30, September 30 and
December 31), beginning in the first calendar quarter in which NET SALES
occur.
7.4. All
EARNED ROYALTIES and other payments due under this Agreement shall be paid
directly to LICENSOR in United States Dollars. In the event that conversion
from
foreign currency is required in calculating a payment under this Agreement,
the
exchange rate used shall be the Interbank rate quoted by Citibank at the
end of
the last business day of the quarter in which the royalty was earned. If
overdue, the royalties and any other payments due under this Agreement shall
bear interest until payment at a per annum rate two percent (2%) above the
prime
rate in effect at Citibank on the due date and the LICENSOR shall be entitled
to
recover reasonable attorneys’ fees and costs related to the administration or
enforcement of this Agreement, including collection of royalties or other
payments, following such failure to pay. The payment of such interest shall
not
foreclose the LICENSOR from exercising any other right it may have as a
consequence of the failure of LICENSEE to make any payment when
due.
7.5. In
the
event that LICENSEE’S outside patent counsel together with LICENSOR’S outside
patent counsel agree (which discussion and agreement shall be in good faith)
that patent licenses from third parties are reasonably required by LICENSEE,
its
AFFILIATES or its SUBLICENSEE to make, use, offer for sale, sell or import
any
LICENSED PRODUCT in any given country, LICENSOR and LICENSEE shall negotiate
in
good faith with the intention of reaching a fair and equitable formula on
how
any amount paid by LICENSEE to such third parties shall be shared by LICENSEE
and LICENSOR, except that EARNED ROYALTY payable to LICENSOR on NET SALES
of
such LICENSED PRODUCTS shall not be reduced by more than fifty percent
(50%).
7.6. No
multiple royalties shall be payable because the use, lease or sale of any
LICENSED PRODUCT is, or shall be, covered by more than one VALID CLAIM contained
in the LICENSED PATENTS.
7.7. In
the
event that a LICENSED PRODUCT is sold in the form of a combination package
together with companion products that are not themselves a LICESED PRODUCT,
the
NET SALES for such combination package upon which the Earned Royalty due
to
LICENSOR is based shall be calculated by multiplying the total sales price
of
such combination package by the fraction A/(A+B), where A is the invoice
price
of the LICENSED PRODUCT if sold separately, and B is the total invoice price
of
each of the other companion products included in the combination package
if sold
separately.
ARTICLE
8 DUE
DILIGENCE
8.1. LICENSEE,
its SUBLICENSEES, or its AFFILIATES shall use all REASONABLE COMMERCIAL EFFORTS
to conduct a research program designed to result in the regulatory approval
and
commercialization of the LICENSED PRODUCTS. LICENSEE shall demonstrate such
efforts by performing any of the following activities:
(a) File
an
IND within [***] of the EFFECTIVE DATE of this Agreement;
(b) Upon
IND
filing, LICENSEE, its’ SUBLICENSEES, or their AFFILIATES, shall demonstrate
ongoing engagement of clinical development for LICENSED PRODUCTS, which shall
be
evidenced by conducting at least one of the following activities in any given
year starting from the date of IND filing:
| |
(i)
|
having
expended at least [***] for development of LICENSED
PRODUCT;
|
| |
(ii)
|
having
manufactured LICENSED PRODUCT suitable for clinical trials under
an
approved IND;
|
| |
(iii)
|
having
actively engaged in study preparation, implementation or reporting
of a
PHASE I, PHASE II (proof-of-concept), or PHASE III CLINICAL TRIAL
with
respect to a LICENSED PRODUCT or the construction of regulatory
documents
for filing;
|
| |
(iv)
|
having
responded to regulatory requests/issues relating to a PHASE I,
PHASE II,
or PHASE III CLINICAL TRIAL of a LICENSED
PRODUCT;
|
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(v)
|
having
prepared documents for NDA filing with respect to a LICENSED
PRODUCT;
|
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(vi)
|
having
filed an NDA for a LICENSED
PRODUCT;
|
| |
(vii)
|
following
NDA filing, having actively pursued NDA approval for a LICENSED
PRODUCT;
or
|
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(viii)
|
following
NDA approval of a LICENSED PRODUCT, having launched or sold a LICENSED
PRODUCT in the United States or another MAJOR MARKET
COUNTRY.
|
8.2. Failure
to comply with development activities described in Article 8.1
above
within the prescribed time frame shall be considered a material breach of
the
LICENSE under 15.1(a),
unless
such failure is through no fault of the LICENSEE, including without limitation,
a change in regulatory guidelines, generally accepted opinions or standards;
the
introduction of a new standard of care during the development of LICENSED
PRODUCTS which affects the development strategy for LICENSED PRODUCTS; or
unexpected findings (safety or efficacy) in clinical studies, pre-clinical
studies or chemistry, manufacturing and control that delays clinical development
or that requires that phase to be repeated. In such an instance, the parties
shall amend the timelines accordingly.
8.3. Within
30
days of the end of the calendar quarters ending 30 June and 31 December,
LICENSEE shall provide the LICENSOR with a report on the status of the
development and marketing of each LICENSED PRODUCT of LICENSEE, SUBLICENSEES
and
their respective AFFILIATES and shall promptly provide the LICENSOR with
such
additional details of such development and marketing as the LICENSOR may
from
time to time reasonably request.
8.4. The
parties shall establish an advisory board or other similar body consisting
of
Dr. Casagrande and other persons designated by LICENSEE (“PROJECT TEAM”). The
PROJECT TEAM shall meet in person or by telephone or other mutually agreed
upon
method to provide guidance to the LICENSEE in the pre-clinical and clinical
development of the LICENSED PRODUCTS. The LICENSEE shall reimburse Dr.
Casagrande for the normal travel and other expenses incurred for the
participation in person to the PROJECT TEAM meetings.
ARTICLE
9 CONFIDENTIALITY
AND PUBLICITY
9.1. Subject
to the parties’ rights and obligations pursuant to this Agreement, the LICENSOR
and LICENSEE agree that during the term of this Agreement and for five (5)
years
thereafter, each of them:
(a) will
keep
confidential and will cause their AFFILIATES and, in the case of LICENSEE,
its
SUBLICENSEES, to keep confidential, CONFIDENTIAL INFORMATION disclosed to
it by
the other party, by taking whatever action the party receiving the CONFIDENTIAL
INFORMATION would take to preserve the confidentiality of its own CONFIDENTIAL
INFORMATION, which in no event shall be less than reasonable care;
and
(b) will
only
disclose that part of the other’s CONFIDENTIAL INFORMATION to its officers,
employees, agents, or independent contractors that is necessary for those
officers, employees, agents, or independent contractors who need to know
to
carry out its responsibilities under this Agreement; and
(c) will
not
use the other party’s CONFIDENTIAL INFORMATION other than as expressly set forth
in this Agreement or disclose the other’s CONFIDENTIAL INFORMATION to any third
parties under any circumstance without advance written permission from the
other
party; and
(d) will,
within sixty (60) days of termination or expiration of this Agreement, return
all the CONFIDENTIAL INFORMATION disclosed to it by the other party pursuant
to
this Agreement except for one copy which may be retained by the recipient
for
monitoring compliance with this ARTICLE
9.
9.2. The
obligations of confidentiality described above shall not pertain to that
part of
the CONFIDENTIAL INFORMATION that:
(a) was
known
to the recipient prior to the disclosure by the disclosing party;
or
(b) is
at the
time of disclosure or has become thereafter publicly known through no fault
or
omission attributable to the recipient; or
(c) is
rightfully given to the recipient from sources independent of the disclosing
party; or
(d) is
independently developed by the receiving party without use of or reference
to
the CONFIDENTIAL INFORMATION of the other party; or
(e) is
required to be disclosed by law in the opinion of recipient’s attorney, but only
after the disclosing party is given prompt written notice and an opportunity
to
seek a protective order.
9.3. Except
as
required by law, neither party may disclose the financial terms of this
Agreement without the prior written consent of the other party.
9.4. The
terms
of this Agreement shall be deemed confidential to the extent permitted by
law,
rule or regulation.
ARTICLE
10 REPORTS,
RECORDS AND INSPECTIONS
10.1. Following
FIRST SALE, LICENSEE shall, within sixty (60) days after the calendar year
in
which NET SALES first occurs, and within sixty (60) days after each calendar
quarter (March 31, June 30, September 30 and December 31) thereafter, provide
the LICENSOR with a written report detailing the NET SALES, if any, made
by
LICENSEE, its SUBLICENSEES and AFFILIATES of LICENSED PRODUCTS during the
preceding calendar quarter and calculating the payments due pursuant to
ARTICLE
7.
NET
SALES of LICENSED PRODUCTS shall be deemed to have occurred on the date of
invoice for such LICENSED PRODUCTS. Each such report shall be signed by an
officer of LICENSEE (or the officer's designee), and must include:
(a) the
number of LICENSED PRODUCTS manufactured, sold, leased or otherwise transferred
or disposed of by LICENSEE, SUBLICENSEES and AFFILIATES;
(b) a
calculation of NET SALES for the applicable reporting period in each country,
including the gross invoice prices charged for the LICENSED PRODUCTS and
any
permitted deductions made pursuant to Article 2.24;
(c) a
calculation of total royalties or other payment due, including any exchange
rates used for conversion;
(d) names
and
addresses of all SUBLICENSEES and the type and amount of any SUBLICENSE INCOME
received from each SUBLICENSEE.
10.2. LICENSEE
and its SUBLICENSEES shall keep, maintain complete and accurate records and
books containing an accurate accounting of all data in sufficient detail
to
enable verification of EARNED ROYALTIES and other payments under this Agreement.
LICENSEE shall preserve such books and records for three (3) years after
the
calendar year to which they pertain, or, in case of any dispute, until such
dispute is finally decided or settled. Such books and records shall be open
to
inspection by the LICENSOR or an independent certified public accountant
selected by the LICENSOR, at the LICENSOR’s expense, during normal business
hours upon ten (10) days' prior written notice, for the purpose of verifying
the
accuracy of the reports and computations rendered by LICENSEE. In the event
LICENSEE underpaid the amounts due to the LICENSOR with respect to the audited
period by more than [***]), LICENSEE shall pay the reasonable cost of such
examination, together with the deficiency not previously paid, and accrued
interest on the underpayment at the lesser of the maximum rate allowed by
law or
[***] per month, all within thirty (30) days of receiving notice thereof
from
the LICENSOR. If the LICENSEE underpays by more than [***] in any calendar
quarter, then the LICENSEE shall from that date forward deliver at LICENSEE’S
cost and expense an annual audit within 90 days after the end of each annual
period.
10.3. On
or
before the 90th
day
following the close of LICENSEE’S fiscal year, LICENSEE shall provide the
LICENSOR with LICENSEE’S certified financial statements for the preceding fiscal
year including, at a minimum, a balance sheet and an income statement, including
notes relating to the License Agreement. LICENSEE shall also require that
any
SUBLICENSEE provide the LICENSEE and the LICENSOR with annual audited financial
statements for within ninety (90) days following the date of the closing
of the
SUBLICENSEE’s preceding fiscal year.
ARTICLE
11 PATENT
PROSECUTION
11.1. LICENSEE
shall be responsible for all past, present and future costs of filing,
prosecution and maintenance of any and all United States and foreign patent
applications contained in the LICENSED PATENTS. Any and all such United States
and foreign patent applications, and resulting issued patents, shall remain
the
property of the LICENSOR.
11.2. The
costs
described in Article 11.1
shall
include, but are not limited to, any past, present and future taxes, government
fees, patent attorney fees, annuities, working fees, maintenance fees, renewal
and extension charges. Payment of such costs shall be made, at the LICENSOR'S
option, either directly to patent counsel or by reimbursement to the
LICENSOR.
11.3. The
activities provided for in Article 11.1 shall be performed and all new and
existing patent applications under the LICENSED PATENTS shall be prepared,
prosecuted, filed and maintained by patent counsel selected by LICENSEE and
which is reasonably acceptable to the LICENSOR. LICENSEE shall be responsible
for directing prosecution. With respect to any LICENSED PATENTS, LICENSEE
and
patent counsel shall:
(a) consult
with the LICENSOR and keep the LICENSOR fully and timely informed of the
performance of the activities provided for in Article 11.1 and the progress
of
all patent applications and patents, including all issues relating to the
preparation, filing, prosecution and maintenance of LICENSED
PATENTS;
(b) consult
with the LICENSOR and keep the LICENSOR fully informed about LICENSEE’s patent
strategy with respect to the LICENSED PATENTS;
(c) provide
to the LICENSOR advance copies of documents relevant to preparation, filing,
prosecution and maintenance of the LICENSED PATENTS sufficiently in advance
of
filing to allow the LICENSOR a reasonable opportunity to review and comment
on
such documents; and
(d) provide
the LICENSOR with final copies of such documents. LICENSEE agrees to use
commercially reasonable efforts to obtain broad and strong patent protection
in
the best interest of the LICENSOR and LICENSEE. LICENSEE will not finally
abandon any patent application, or make decisions that would have a material
impact on the nature or scope of any claims without the LICENSOR’ consent.
11.4. LICENSEE
shall apply, and shall require SUBLICENSEES to apply, the patent marking
notices
required by the law of any country where such LICENSED PRODUCTS are made,
sold,
used or shipped, including, but not limited to, the applicable patent laws
of
that country.
ARTICLE
12 INFRINGEMENT
AND LITIGATION
12.1. Each
party shall promptly notify the other in writing in the event that it obtains
knowledge of infringing activity by third parties, or is sued or threatened
with
an infringement suit, in any country in the LICENSED TERRITORY as a result
of
activities that concern the LICENSED PATENTS and shall supply the other party
with documentation of the infringing activities that it possesses.
12.2. During
the TERM of this Agreement:
(a) LICENSEE
shall have the first right and obligation to defend the LICENSED PATENTS
against
infringement or interference in the FIELD and in the LICENSED TERRITORY by
third
parties. This right and obligation includes bringing any legal action for
infringement and defending any counter claim of invalidity or action of a
third
party for declaratory judgment for non-infringement or non-interference.
If, in
the reasonable opinion of LICENSEE’S and the LICENSOR’ respective counsel, the
LICENSOR are required to be a named party to any such suit for standing
purposes, LICENSEE may join the LICENSOR as a party; provided,
however,
that
(i) the LICENSOR shall not be the first named party in any such action,
(ii) the pleadings and any public statements about the action shall state
that
the action is being pursued by LICENSEE and that LICENSEE has joined the
LICENSOR as a party; and (iii) LICENSEE shall keep the LICENSOR reasonably
apprised of all developments in any such action. LICENSEE may settle such
suits
solely in its own name and solely at its own expense and through counsel
of its
own selection; provided,
however,
that no
settlement shall be entered without the LICENSOR’ prior written consent.
LICENSEE shall bear the expense of such legal actions. Except for providing
reasonable assistance, at the request and expense of LICENSEE, the LICENSOR
shall have no obligation regarding the legal actions described in Article
12.2
unless
required to participate by law. However, the LICENSOR shall have the right
to
participate in any such action through its own counsel and at its own expense.
Any recovery shall first be applied to LICENSEE’S out of pocket expenses and
second shall be applied to the LICENSOR’S out of pocket expenses, including
legal fees. Any excess recovery over LICENSEE’S out of pocket expenses and
LICENSOR’ out of pocket expenses, if any, shall be deemed NET SALES and shared
in accordance with Article 7.1.
(b) In
the
event LICENSEE fails to initiate and pursue or participate in the actions
described in Article 12.2(a)
within
sixty (60) days of (a) notification of infringement from the LICENSOR or
(b) the
date LICENSEE otherwise first becomes aware of an infringement, whichever
is
earlier, the LICENSOR shall have the right to initiate such legal action
at its
own expense and the LICENSOR may use the name of LICENSEE as party plaintiff
to
uphold the LICENSED PATENTS. In such case, LICENSEE shall provide reasonable
assistance to the LICENSOR if requested to do so. The LICENSOR may settle
such
actions solely through its own counsel. Any recovery shall be the sole property
of LICENSOR.
12.3. In
the
event LICENSEE is permanently enjoined from exercising its LICENSE under
this
Agreement pursuant to an infringement action brought by a third party, or
if
both LICENSEE and the LICENSOR elect not to undertake the defense or settlement
of a suit alleging infringement for a period of six (6) months from notice
of
such suit, then either party shall have the right to terminate this Agreement
in
the country where the suit was filed with respect to the licensed patent
following thirty (30) days’ written notice to the other party in accordance with
the terms of ARTICLE
17.
ARTICLE
13 USE
OF LICENSOR’S NAME
Each
party shall obtain the prior written approval of the other prior to making
use
of the name of the other party nor any variation or adaptation thereof for
any
commercial purpose, except as required to comply with law, regulation or
court
order.
ARTICLE
14 PUBLICATION
14.1. In
the
event that LICENSOR desires to publish or disclose, by written, oral or other
presentation, any material information related to the INVENTION, the LICENSED
PATENTS, a NEW INVENTION or any LICENSED PRODUCT, or results relating to
the
clinical or non-clinical testing of any of the foregoing, LICENSOR shall
notify
LICENSEE and LICENSOR in writing pursuant to ARTICLE
17
of their
intention no less than
60 days
prior to any speech, lecture or other oral presentation,
or any
written or other publication or disclosure.
14.2. The
LICENSOR shall include with any such notice pursuant to Article 14.1
a
description of any proposed oral presentation or, in any proposed written
or
other disclosure, a current draft of such proposed disclosure or abstract.
14.3. LICENSEE
may request that the LICENSOR, no later than 30 days following the receipt
of
such notice, delay such publication or disclosure in order to enable LICENSEE
to
file, or have filed on its behalf, a patent application, copyright or other
appropriate form of intellectual property protection related to the information
to be disclosed. Upon receipt of such notice, LICENSOR shall arrange for
a delay
in publication or disclosure until such time as LICENSEE has filed on LICENSOR’s
name and behalf such patent application, copyright or other appropriate form
of
intellectual property protection that LICENSEE agrees to file as soon as
is
reasonably practicable provided, however that said deferral shall not exceed
90
days from the receipt of such notice.
14.4. If
the
LICENSOR does not receive any request to delay publication or disclosure
pursuant to Article 14.3,
LICENSOR may submit such material for publication or presentation or make
such
other publication or disclosure.
ARTICLE
15 TERMINATION
15.1. LICENSOR
shall have the right to terminate this Agreement pursuant to the provisions
below, provided that LICENSOR has given LICENSEE the notice required in
accordance Article 15.2
and
LICENSEE has failed to cure the breach described in such notice:
(a) breach
by
LICENSEE of a material term of the Agreement;
(b) the
institution of any proceeding by LICENSEE under any bankruptcy, insolvency,
or
moratorium law;
(c) any
assignment by LICENSEE of substantially all of its assets for the benefit
of
creditors;
(d) placement
of LICENSEE’S assets in the hands of a trustee or a receiver unless the
receivership or trust is dissolved within 30 days thereafter and provided
that
in the case of an involuntary bankruptcy proceeding, which is contested by
LICENSEE, such termination shall not become effective until the bankruptcy
court
of jurisdiction has entered an order upholding the petition; or
(e) a
decision by LICENSEE or LICENSEE’S licensee or assignee of rights under this
Agreement to quit the business of developing or selling Licensed
Products.
15.2. LICENSOR
may exercise its rights pursuant to Article 15.1
above by
giving LICENSEE ninety (90) days' prior written notice (the “Written Notice”) of
LICENSOR'S intention to terminate. Such notice shall include the basis for
such
termination. Upon the expiration of such period, LICENSOR shall provide written
notice of termination to LICENSEE (the “Termination Notice”), effective upon
receipt, unless LICENSEE has cured the material breach or the other basis
for
such proposed termination during such ninety (90) day period. Such notice
and
termination shall not prejudice LICENSOR'S right to receive Earned Royalties
accrued prior to termination, or other sums due hereunder and shall not
prejudice any cause of action or claim of LICENSOR accrued or to accrue on
account of any breach or default by LICENSEE.
15.3. LICENSEE
shall have the right to terminate this Agreement pursuant to the provisions
below, provided that LICENSEE has given LICENSOR the notice required in
accordance with Article 15.4:
(a) LICENSEE
may terminate this Agreement upon breach by LICENSOR of a material term of
the
Agreement; or
(b) LICENSEE
may terminate this Agreement in its reasonable commercial business judgment
by
providing written notice of such termination given to LICENSOR at least ninety
(90) days prior to the date of such termination. Such
notice of termination shall include an explanation for termination, which
may
include, but is not limited to, pre-clinical or clinical safety or efficacy
results, formulation or manufacturing issues, a change in legal or regulatory
rules or scientific opinion, changes in the competitive environment, pipeline
prioritization or other reorganization or redirection of LICENSEE’s
business.
15.4. LICENSEE
may exercise its right of termination pursuant to Article 15.3(a),
by
giving LICENSOR ninety (90) days' prior written notice of LICENSEE’S intention
to terminate and by providing in its termination notice the basis for such
termination. Upon the expiration of the ninety (90) day period, LICENSEE
shall
provide written notice of termination to LICENSOR, effective upon receipt,
unless LICENSOR has cured the breach or the other basis for such proposed
termination during such ninety (90) day period. Such notice of termination
shall
not prejudice any cause of action or claim of LICENSEE accrued or to accrue
on
account of any breach or default by LICENSOR.
15.5. If
this
Agreement is terminated pursuant to the provisions of Article 15.1,
then
all of LICENSEE’s rights under LICENSED PATENTS shall terminate and LICENSEE
shall return to LICENSOR, or at LICENSOR'S direction, destroy all data, writings
and other documents and tangible materials supplied to LICENSEE by LICENSOR
hereunder. Any SUBLICENSES will remain in full force and effect and will
be
assigned to the LICENSOR.
15.6. If
this
Agreement is terminated pursuant to Section 15.2
or
15.3(b):
(a) LICENSEE
shall further, upon LICENSOR's request and with no need for additional
consideration, grant to LICENSOR an exclusive, worldwide, fully paid, perpetual
license, with full rights to sublicense, under all of LICENSEE’s rights in any
LICENSED PATENTS and LICENSED INFORMATION. Further, at LICENSOR’s request,
LICENSEE agrees to negotiate in good faith for an agreement (the “Data
License”), which shall be on commercially reasonable terms, under which LICENSEE
would provide to LICENSOR the rights to use full and complete copies of all
toxicity, efficacy, and other data generated or owned by LICENSEE or LICENSEE’s
Affiliates, (including by contractors or agents on their behalf) in the course
of LICENSEE’s efforts to develop LICENSED PRODUCTS or obtain governmental
approval for the SALE of LICENSED PRODUCTS, for use in connection with the
development and commercialization of LICENSED PRODUCTS with
right to provide such data pertaining to the LICENSED PATENTS and LICENSED
INFORMATION to any THIRD PARTY with a bona fide interest in licensing such
technology.
Under
the terms of such a Data Agreement, in the event a THIRD PARTY concludes
a
license with LICENSOR, such THIRD PARTY would be free to use such data for
all
purposes, including to obtain government approvals to sell
products.
(b) In
furtherance of Section 15.6(a),
the
LICENSEE agrees that, within 60 days of written request by the LICENSOR,
LICENSEE shall make available for review by LICENSOR, or any THIRD PARTY
identified by the LICENSOR with a bona fide interest in licensing the LICENSED
PATENTS, copies of such data and information pertaining to LICENSED PATENTS
and
LICENSED INFORMATION in a mutually convenient location. Any such data would
be
provided on a confidential basis pursuant to a mutually agreeable
confidentiality agreement.
(c) LICENSOR
or such THIRD PARTY shall bear the costs incurred by LICENSEE in connection
with
providing information pursuant to this Section.
(d) Any
Sublicense entered into by the LICENSEE shall contain provisions substantially
similar to the ones contained herein with respect to data and information
generated by the SUBLICENSEE.
15.7. The
failure of either Party, at any time, or for any period of time, to enforce
any
of the provisions of this Agreement, shall not be construed as a waiver of
such
provisions or as a waiver of the right of either Party’s thereafter to enforce
each and every such provision of this Agreement.
15.8. The
rights provided in this ARTICLE
15
shall be
in addition and without prejudice to any other rights which the parties may
have
with respect to any default or breach of the provisions of this
Agreement.
ARTICLE
16 INDEMNIFICATION;
INSURANCE; NO WARRANTIES
16.1. LICENSEE
shall defend, indemnify and hold harmless the LICENSOR, its trustees, directors,
officers, employees, and agents and their respective successors, heirs and
assigns against any and all liabilities, claims, demands, damages, judgments,
losses and expenses of any nature, including without limitation legal expenses
and attorneys' fees (a “CLAIM”), arising out of any theory of liability
(including without limitation tort, warranty, or strict liability) or the
death,
personal injury, or illness of any person or out of damage to any property
related in any way to the rights granted under this Agreement; or resulting
from
the production, manufacture, sale, use, lease, or other disposition or
consumption or advertisement of the LICENSED PRODUCTS by LICENSEE, its
AFFILIATES, SUBLICENSEES or any other transferees; or in connection with
any
statement, representation or warranty of LICENSEE, its AFFILIATES, SUBLICENSEES
or any other transferees with respect to the LICENSED PRODUCTS; provided,
however, that the LICENSEE shall not be responsible to indemnify the LICENSOR
pursuant to this Article 16.1
to the
extent any CLAIM arises out of the LICENSOR’S gross negligence or willful
misconduct and LICENSEE shall not be responsible to indemnify LICENSOR pursuant
to this Article 16.1
to the
extent any CLAIM arises out of LICENSOR’S gross negligence or willful
misconduct.
16.2. LICENSEE
shall purchase and maintain in effect and shall require its SUBLICENSEES
to
purchase and maintain in effect a policy of commercial, general liability
insurance to protect the LICENSOR with respect to events described in Article
16.1.
Such
insurance shall:
(a) list
LICENSOR as an additional insured under the policy;
(b) provide
that such policy is primary and not excess or contributory with regard to
other
insurance the LICENSOR may have;
(c) be
endorsed to include product liability coverage in amounts no less than [***]
per
incident and [***] annual aggregate; and
(d) be
endorsed to include contractual liability coverage for LICENSEE’S
indemnification under Article 16.1;
and
(e) by
virtue
of the minimum amount of insurance coverage required under Article 16.2(c)
, not be
construed to create a limit of LICENSEE’S liability with respect to its
indemnification under Article 16.1.
16.3. By
signing this Agreement, LICENSEE certifies that the requirements of
Article 16.2
will be
met on or before the earlier of (a) the date of FIRST SALE of any LICENSED
PRODUCT or (b) the date any LICENSED PRODUCT is tested or used on humans,
and
will continue to be met thereafter. Upon
the
LICENSOR’ request, LICENSEE shall furnish a Certificate of Insurance and a copy
of the current Insurance Policy to the LICENSOR. LICENSEE shall give thirty
(30)
days’ written notice to the LICENSOR prior to any cancellation of or material
change to the policy.
16.4. THE
LICENSOR MAKES NO REPRESENTATIONS OR WARRANTIES THAT ANY CLAIMS OF THE LICENSED
PATENTS, ISSUED OR PENDING, ARE VALID, OR THAT THE MANUFACTURE, USE, SALE
OR
OTHER DISPOSAL OF THE LICENSED PRODUCTS OR USE OF THE LICENSED INFORMATION
DOES
NOT OR WILL NOT INFRINGE ANY PATENT OR OTHER RIGHTS NOT VESTED IN THE
LICENSOR.
16.5. THE
LICENSOR DISCLAIMS ALL WARRANTIES WHATSOEVER WITH RESPECT TO THE LICENSED
PATENTS, LICENSED INFORMATION, LICENSED PRODUCTS, EITHER EXPRESS OR IMPLIED,
INCLUDING, BUT NOT LIMITED TO, WARRANTIES OF MERCHANTABILITY OR FITNESS FOR
A
PARTICULAR PURPOSE. LICENSEE SHALL MAKE NO STATEMENTS, REPRESENTATION OR
WARRANTIES WHATSOEVER TO ANY THIRD PARTIES WHICH ARE INCONSISTENT WITH SUCH
DISCLAIMER BY THE LICENSOR. IN NO EVENT SHALL THE LICENSOR, OR ITS TRUSTEES,
DIRECTORS, OFFICERS, EMPLOYEES AND AFFILIATES, BE LIABLE FOR SPECIAL,
INCIDENTAL, CONSEQUENTIAL OR INDIRECT DAMAGES OF ANY KIND, INCLUDING ECONOMIC
DAMAGE OR INJURY TO PROPERTY AND LOST PROFITS, REGARDLESS OF WHETHER THE
LICENSOR SHALL BE ADVISED, SHALL HAVE OTHER REASON TO KNOW, OR IN FACT SHALL
KNOW OF THE POSSIBILITY OF THE FOREGOING.
16.6. IN
NO
EVENT SHALL THE LICENSOR, OR ITS TRUSTEES, DIRECTORS, OFFICERS, EMPLOYEES
AND
AFFILIATES, BE LIABLE FOR DAMAGES IN EXCESS OF AMOUNTS THE LICENSOR HAVE
RECEIVED FROM LICENSEE UNDER THIS LICENSE.
ARTICLE
17 NOTICES,
PAYMENTS
17.1. Any
payment, notice or other communication required by this Agreement (a) shall
be
in writing, (b) may be delivered personally or sent by reputable overnight
courier with written verification of receipt or by registered or certified
first
class United States Mail, postage prepaid, return receipt requested, (c)
shall
be sent to the following addresses or to such other address as such party
shall
designate by written notice to the other party, and (d) shall be effective
upon
receipt:
|
FOR
LICENSOR:
Dr.
Cesare Casagrande
Via
Campogallo, 21/67
20020
Arese, Milan
Italy
Tel:
Fax:
E-mail:
|
FOR
LICENSEE:
Chief
Executive Officer
Nile
Therapeutics, Inc.
2850
Telegraph Avenue, Suite 310
Berkeley,
CA 94705
Tel:
(510) 281-7701
Fax:
(510) 288-1310
E-mail:
info@nilethera.com
|
ARTICLE
18 LAWS,
FORUM AND REGULATIONS
18.1. Any
dispute arising out of or in connection with this Agreement, including any
question regarding their existence, validity or termination, shall be finally
solved under the Rules of Arbitration of the International Chamber of Commerce,
which Rules are deemed to be incorporated by reference into this clause.
The
number of arbitrators shall be three. The seat, or legal place, of arbitration
shall be London, England. The language to be used in the arbitration shall
be
English. The arbitrators shall decide ex bono et aequo.
18.2. LICENSEE
shall comply, and shall cause its AFFILIATES and SUBLICENSEES to comply,
with
all foreign and United States federal, state, and local laws, regulations,
rules
and orders applicable to the testing, production, transportation, packaging,
labeling, export, sale and use of the LICENSED PRODUCTS. In particular, LICENSEE
shall be responsible for assuring compliance with all United States export
laws
and regulations applicable to this LICENSE and LICENSEE’S activities under this
Agreement.
ARTICLE
19 REPRESENTATIONS
AND WARRANTIES
19.1. LICENSEE
represents and warrants to LICENSOR that:
(a) LICENSEE
is a duly organized and validly existing corporation under the laws of the
State
of Delaware with adequate power and authority to conduct the business in
which
it is now engaged or currently proposed to be engaged, and LICENSEE is duly
qualified to do business as a foreign corporation and is in good standing
in
such other states or jurisdictions as is necessary to enable it to carry
on its
business or own its properties.
(b) To
the
best of LICENSEE’S knowledge, there are no actions, suits, or proceedings
pending or threatened against or affecting LICENSEE, its officers or directors
in their capacity as such, its properties, or its patents in any court or
before
any governmental or administrative agency, which can have any material adverse
effect on the business as now conducted or as currently proposed to be
conducted, on the properties, the financial condition, or income of LICENSEE,
or
the transactions contemplated by this Agreement and LICENSEE is not in default
under any order or judgment of any court or governmental or administrative
agency.
(c) LICENSEE
has full power and lawful authority to issue and sell the shares of COMMON
STOCK
on the terms and conditions contained herein.
(d) Consummation
of the transactions contemplated by this Agreement in compliance with provisions
of this Agreement will not result in any breach of any of the terms, conditions,
or provisions of, or constitute a default under, or result in the creation
of
any lien, charge, or encumbrance on, any property or assets of LICENSEE pursuant
to any indenture, mortgage, deed of trust, agreement, corporate charter,
bylaws,
contract, or other instrument to which LICENSEE is a party or by which Licensee
may be bound or any law, rule, regulation, qualification, license, order
or
judgment applicable to Licensee or any of its property.
(e) LICENSEE
is run by a management team that is experienced in operating companies in
the
business of commercial drug development.
19.2. LICENSOR
represents and warrants to LICENSEE that as of the EFFECTIVE DATE:
(a) LICENSOR
has the full right and power to perform the obligations and grant the LICENSE
set forth in this Agreement;
(b) There
are
no outstanding agreements, assignments or encumbrances in existence inconsistent
with the provisions of this Agreement;
(c) LICENSOR
has not authorized in any manner any Third Party to practice the LICENSED
PATENTS;
(d)
LICENSOR
owns or possesses all right, title, and interest in and to the LICENSED PATENTS,
including exclusive, absolute, irrevocable right, title and interest thereto,
free and clear of all liens, charges, encumbrances or other restrictions
or
limitations of any kind whatsoever;
(e) There
are
no licenses, options, restrictions, liens, rights of third parties, disputes,
proceedings or claims relating to, affecting, or limiting its rights or the
rights of LICENSEE under this Agreement with respect to, or which (i) may
lead
to a claim of infringement or invalidity regarding, any part or all of the
LICENSED PATENTS and their use as contemplated in the underlying patent
applications as presently drafted or (ii) imposes obligations upon LICENSOR
or
gives any rights to LICENSOR which, in either case, would adversely affect
the
rights of LICENSEE or the obligations of LICENSOR under this Agreement;
(f) To
the
best of LICENSOR’S knowledge and belief there is no claim, pending or
threatened, of infringement, interference or invalidity regarding, any part
or
all of the LICENSED PATENTS and their use as contemplated in the underlying
patent applications as presently drafted or as contemplated under this
Agreement;
(g) Appendix
A
lists
all patents issued and patent applications filed on or before the Effective
Date
of this Agreement within the scope of the LICENSED PATENTS and therefore
subject
to this Agreement and all of the inventors named in the patents and patent
applications listed in Appendix
A
have
assigned, or are under an obligation to assign, to LICENSOR all of their
right,
title an interest in the inventions claimed; and
(h) LICENSOR
understand
that the shares of COMMON STOCK have not been registered under the Securities
Act by reason of a claimed exemption under the provisions of the Securities
Act
that depends, in part, upon the LICENSOR’
investment
intention. In this connection, LICENSOR
hereby
represent that LICENSOR
are
acquiring the shares of COMMON STOCK for the LICENSOR
own
account for investment and not with a view toward the resale or distribution
to
others.
ARTICLE
20 MISCELLANEOUS
20.1. This
Agreement shall be binding upon and inure to the benefit of the parties and
their respective legal representatives, successors and permitted
assigns.
20.2. This
Agreement constitutes the entire agreement of the parties relating to the
LICENSED PATENTS and LICENSED INFORMATION, and all prior representations,
agreements and understandings, written or oral, are merged into it and are
superseded by this Agreement.
20.3. The
provisions of this Agreement shall be deemed separable. If any part of this
Agreement is rendered void, invalid, or unenforceable, such determination
shall
not affect the validity or enforceability of the remainder of this Agreement
unless the part or parts which are void, invalid or unenforceable shall
substantially impair the value of the entire Agreement as to either
party.
20.4. Paragraph
headings are inserted for convenience of reference only and do not form a
part
of this Agreement.
20.5. No
person
not a party to this Agreement, including any employee of any party to this
Agreement, shall have or acquire any rights by reason of this Agreement.
Nothing
contained in this Agreement shall be deemed to constitute the parties partners
with each other or any third party.
20.6. This
Agreement may not be amended or modified except by written agreement executed
by
each of the parties. Other than in the event of a CHANGE OF CONTROL (as defined
herein) LICENSOR'S prior written consent, which shall not be unreasonably
withheld, shall be required prior to any other assignment of LICENSEE’S rights
or obligations under this Agreement. Following any such assignment or CHANGE
OF
CONTROL, the surviving corporation shall assume all of the rights and
obligations included in this Agreement. Any attempted assignment in
contravention of this Article 20.6
shall be
null and void and shall constitute a material breach of this Agreement.
LICENSOR'S prior written consent, which shall not be unreasonably withheld,
shall be required prior to any other assignment of LICENSEE’S rights or
obligations under this Agreement.
20.7. LICENSEE,
or any SUBLICENSEE or assignee, will not create, assume or permit to exist
any
lien, pledge, security interest or other encumbrance on this Agreement or
any
SUBLICENSE AGREEMENT.
20.8. The
failure of any party hereto to enforce at any time, or for any period of
time,
any provision of this Agreement shall not be construed as a waiver of either
such provision or of the right of such party thereafter to enforce each and
every provision of this Agreement.
20.9. LICENSEE
acknowledges that it is subject to and agrees to abide by the United States
laws
and regulations (including the Export Administration Act of 1979 and Arms
Export
Contract Act) controlling the export of technical data, computer software,
laboratory prototypes, biological material, and other commodities. The transfer
of such items may require a license from the cognizant agency of the U.S.
Government or written assurances by LICENSEE that it shall not export such
items
to certain foreign countries without prior approval of such agency. LICENSOR
neither represents that a license is or is not required or that, if required,
it
shall be issued.
20.10. LICENSEE
is responsible for any and all wire/bank fees associated with all payments
due
to the LICENSOR pursuant to this Agreement.
[Signatures
On Following Page]
IN
WITNESS to their Agreement, the parties have caused this Agreement to be
executed in duplicate originals by their duly authorized
representatives.
|
DR.
CESARE CASAGRANDE
|
NILE
THERAPEUTICS, INC.
|
|
By:
/s/ Cesare
Casagrande
Name:
Dr. Cesare Casagrande
Date:
August 6, 2007
|
By:
/s/ Peter M. Strumph
Name:
Peter M. Strumph
Title:
Chief Executive Officer
Date:
August 6, 2007
|
APPENDIX
A
1. U.S.
Patent 6,525,078 B1 dated February 24, 2003 entitled “Compound
for the Treatment of Athreosclerotic-Thrombotic Pathological
Conditions.”2. Canadian
Patent Application No. 2,390,966 filed on June 19, 2002
|
3.
|
European
Patent No. 1 270 558 granted April 25, 2007, including the validation
thereof in the following countries:
|
|
Country
|
|
Validation
Date
|
|
Validation
Number
|
|
Austria
|
|
July
25, 2007
|
|
E
360614
|
|
Belgium
|
|
n/a
|
|
n/a
|
|
France
|
|
July
20, 2007
|
|
n/a
|
|
Germany
|
|
July
20, 2007
|
|
601
28 077.6-08
|
|
Great
Britain
|
|
July
9, 2007
|
|
n/a
|
|
Greece
|
|
July
24, 2007
|
|
n/a
|
|
Ireland
|
|
July
13, 2007
|
|
n/a
|
|
Italy
|
|
July
18, 2007
|
|
28416BE/2007
|
|
Spain
|
|
July
19, 2007
|
|
n/a
|
|
Switzerland
& Lichtenstein
|
|
July
19, 2007
|
|
n/a
|
|
The
Netherlands
|
|
July
24, 2007
|
|
n/a
|
|
Turkey
|
|
July
24, 2007
|
|
n/a
|
Japanese
Patent Application No. 181343/2002 filed on June 21, 2002.