Exhibit 10.7
Confidential Materials omitted and filed separately with the
Securities and Exchange Commission. Asterisks denote such omissions.
LICENSE AGREEMENT
FOR
INSTALLING NOVEL FUNCTIONAL GROUPS FOR THERAPEUTICS
BETWEEN
MOMENTA PHARMACEUTICALS, INC.
AND
THE REGENTS OF THE UNIVERSITY OF CALIFORNIA
THROUGH THE
XXXXXX XXXXXXX XXXXXXXX
BERKELEY NATIONAL LABORATORY
L-03-1370
TABLE OF CONTENTS
1. BACKGROUND 1
2. DEFINITIONS 1
3. LICENSE GRAND 3
4. INFORMATION RIGHTS 4
5. SUBLICENSING 5
6. LICENSE ISSUE FEE 5
7. ROYALTIES AND PAYMENTS 6
8. PERFORMANCE REQUIREMENTS 8
9. PROGRESS AND ROYALTY REPORTS 8
10. BOOKS AND RECORDS 9
11. LIFE OF THE AGREEMENT 10
12. TERMINATION BY EITHER PARTY 11
13. TERMINATION BY LICENSEE 11
14. DISPOSITION OF LICENSED PRODUCTS UPON TERMINATION 11
15. USE OF NAMES AND NONDISCLOSURE OBLIGATIONS 11
16. LIMITED WARRANTY 12
17. PATENTING AND FOREIGN RIGHTS 13
18. PATENT INFRINGEMENT 14
19. WAIVER 15
20. ASSIGNMENT 16
21. INDEMNIFICATION 16
22. LATE PAYMENTS 17
23. NOTICES 17
24. U.S. MANUFACTURE 18
25. PATENT l1LAREJNNG 18
26. GOVERNMENT APPROVAL OR XXXXXXXXXXXX 00
00. EXPORT CONTROL LAWS 18
28. FORCE MAJEURE 19
29. MISCELLANEOUS 19
Exhibit A 19
Exhibit B 20
Exhibit C 21
L-03-1370
LICENSE AGREEMENT FOR
INSTALLING NOVEL FUNCTIONAL GROUPS FOR THERAPEUTICS
This
license agreement (the "Agreement") is entered into by The Regents of the
University of California, Department of Energy contract-operators of the Xxxxxx
Xxxxxxx Xxxxxxxx Berkeley National Laboratory, 0 Xxxxxxxxx Xxxx, Xxxxxxxx, XX
00000, ("Berkeley Lab"), and Momenta Pharmaceuticals, Inc. ("Licensee") having
its principal place of business at 00 XxxxxxxXxxxxx, Xxxxxxxxx, XX 00000.
1. BACKGROUND
1.1. Certain inventions, generally characterized as Methods For Installing
Novel Functional Groups On Cells And Cellular Products And Applications
Thereof, as described in Berkeley Lab case [**], (the "Invention"), were
made in the course of research at Berkeley Lab under Berkeley Lab's
contract with the United States Department of Energy ("DOE").
1.2. As DOE sponsored development of the Invention, this Agreement and the
resulting license are subject to overriding obligations to the federal
government pursuant to the provisions of the applicable law or
regulations.
1.3. Berkeley Lab wants the Invention developed and used to the fullest
extent so that the general public enjoys the benefits of the
government-sponsored research.
1.4. Licensee wants to obtain certain rights from Berkeley Lab for the
commercial development, manufacture, use, and sale of the Invention.
1.5. Licensee is a "small business concern" as defined at Section 2 of Public
Law 85-536 (15 U.S.C. 632).
Therefore the parties agree as follows:
2. DEFINITIONS
2.1. "Affiliate" means any legal entity that is controlled by Licensee. For
the purposes of this definition, the term "control" means (i) beneficial
ownership of at least fifty percent (50%) of the voting securities of a
corporation or other entity with voting securities or (ii) a fifty
percent (50%) or greater interest in the net assets or profits of a
partnership or other entity without voting securities.
2.2. "Broader Field" means the synthesis, production or modification of
sugars and glycoconjugates in or on biological molecules for research,
development and commercialization of human therapeutic applications.
2.3. "Effective Date" means the date of execution by the last signing party.
2.4. "Field Election Date" means the second anniversary of the Effective
Date.
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2.5. "Field of Use" means the Broader Field for two years from the Effective
Date, and thereafter means the Specific Applications Field; provided,
however, if Licensee extends its rights in accordance with paragraph
3.3, "Field of Use" shall mean the Broader Field for the life of this
Agreement. In either case, the Field of Use specifically excludes
application of Licensed Patents to sale of reagents for life sciences
research purposes (the "Excluded Field"). Licensee acknowledges that the
Invention is licensed to a third party in that Excluded Field, and that
the Field of Use shall not be interpreted to include any part of the
Excluded Field.
2.6. "Highly Inflationary Currency" means the currency of any economy with a
cumulative inflation rate of 100% or more over the most recent three
calendar years, as measured by consumer price indices published by the
International Monetary Fund (International Financial Statistics),
Washington, D.C.
2.7. "Licensed Patents" means the following:
2.7.1. US Patent Number [**], entitled [**];
2.7.2. US Patent Number [**], entitled, [**];
2.7.3. US Patent Application Serial Number [**], entitled [**];
2.7.4. with respect to paragraphs 2.7.1 to 2.7.3, any corresponding
foreign patent application or patent for which Licensee has met
the requirements of paragraph 17.3;
2.7.5. any division, reexamination, continuation, continuation-in-part
(excluding new matter contained and claimed in that
continuation-in-part), or other application that is a successor
to any of the foregoing applications; and
2.7.6. any patents issuing on any of the foregoing; and all renewals,
reissues and extensions thereof.
2.8. "Licensed Product" means any product, service or process that employs or
is produced by the practice of any invention claimed in Licensed Patents
or whose manufacture, use, practice, sale, offer for sale, or
importation would constitute, but for the license Berkeley Lab grants to
Licensee under this Agreement, an infringement of any Valid Claim in
Licensed Patents in the country where such manufacture, use, practice,
sale, offer for sale, or importation occurs.
2.9. "Related Research Funding" means payments received by Licensee as
reimbursement for research and development expenditures made or to be
made by Licensee for an invention claimed in a Licensed Patent where
such payments cover solely the actual costs of raw materials and labor,
plus direct and indirect costs up to a maximum of [**]% ([**] percent)
of the actual costs of raw materials and labor for such research.
2.10. "Selling Price" for the purpose of computing royalties means the price
received by Licensee, its Affiliate or its sublicensee for the sale of
the Licensed Product in an arms-
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length transaction, less the following: (a) allowances and adjustments
actually credited or allowed to customers; (b) trade, quantity, cash and
prompt payment discounts actually allowed and taken; (c) taxes levied on
and/or other governmental charges imposed as to production, sales,
transportation, delivery or use and paid or collected by or on behalf of
Licensee; (d) costs of insurance, packing, and transportation from the
place of manufacture to the customer's premises or point of
installation; provided, however, that the costs described in clauses (c)
and (d) may only be deducted from the Selling Price if, and to the
extent that, they are separately identified in invoices. When a Licensed
Product is not sold, but is otherwise disposed of, the Selling Price of
that Licensed Product for the purposes of computing royalties is the
selling price at which products of similar kind and quality, sold in
similar quantities, are currently being offered for sale in arms-length
transactions by Licensee. When such products are not currently being
offered for sale by Licensee, the Selling Price of a Licensed Product
otherwise disposed of, for the purpose of computing royalties, is the
average selling price at which products of similar kind and quality,
sold in similar quantities, are then currently being offered for sale by
other manufacturers. When such products are not currently sold or
offered for sale by Licensee or others, then the Selling Price, for the
purpose of computing royalties, shall be negotiated by the parties in
good faith based on the fair market value of the Licensed Product. Sales
or other dispositions of Licensed Products between or among Licensee and
any of its Affiliates or sublicensees for the purpose of subsequent
resale to third parties ("Customers") shall not be included in the
calculation of the Selling Price.
2.11. "Specific Applications Field" means the synthesis, production or
modification of sugars and glycoconjugates in or on biological molecules
for research, development and commercialization of human therapeutic
applications solely within the three specific therapeutic applications
that are negotiated by the parties in accordance with paragraph 3.4.
2.12. "Valid Claim" means a claim of any (1) issued patent in any country that
(i) has not expired; (ii) Berkeley Lab has not disclaimed; (iii) has not
been cancelled or superseded without reinstatement; and (iv) has not
been revoked, held invalid, or otherwise declared unenforceable or not
allowable by a governmental tribunal or patent authority of competent
jurisdiction over such claim in such country from which no further
appeal has or may be taken or (2) any United States patent application
that has not been pending for more than five years or (3) any foreign
patent application that has not been pending for more than seven years.
3. LICENSE GRANT
3.1. Subject to the limitations set forth in this Agreement, Berkeley Lab
grants to Licensee a nontransferable, limited (by the terms of
paragraphs 3.5 and 3.6), exclusive, worldwide, royalty-bearing license,
under Licensed Patents, only in the Field of Use, to make and have made,
use and have used, offer and have offered for sale, sell and have sold,
and import and have imported Licensed Products.
3.2. Licensee's rights from the Effective Date until the Field Election Date
are solely within the Broader Field.
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3.3. Licensee may extend its rights to the Broader Field for the remainder of
the term of this Agreement if it satisfies the following conditions by
the Field Election Date: (1) reasonably demonstrates to Berkeley Lab
that it has achieved the diligence milestones listed in Exhibit A; and
(2) agrees to pay the election fee of $[**], which accrues on the Field
Election Date, and pays the first installment in the amount of $[**] by
the Field Election Date. The remaining two installments of $[**] are
payable six months after the Field Election Date and twelve months after
the Field Election Date, respectively. The election fee is
non-refundable and is not an advance against royalties.
3.4. If Licensee does not meet the requirements of paragraph 3.3, the Field
of Use shall be narrowed as of the Field Election Date to cover three
specific therapeutic applications. Licensee shall select the three
specific applications from the list on Exhibit B, and shall send written
notice of its selection to Berkeley Lab on or before the Field Election
Date. The parties shall promptly negotiate in good faith to arrive,
within 45 days of the Field Election Date, at mutually agreed on written
definitions of the three selected therapeutic fields. Such definitions
shall delineate with better specificity the applications described on
Exhibit B and, so as to enable separate exclusive licensing, be
sufficiently detailed as to be distinct from the non-elected therapeutic
fields described on Exhibit B and other fields of use. Thereafter, the
Field of Use will be the Specific Applications Field.
3.5. Any license under this Agreement is subject to the following: (a) DOE's
non-exclusive, royalty-free license for federal government purposes
only, and (b) DOE's option to grant licenses either if reasonable steps
to commercialize the Invention are not carried out or in order to meet
federal regulations.
3.6. Berkeley Lab expressly reserves the right to make and use the Invention
and associated technology, and to allow other educational and non-profit
institutions to do so, for noncommercial research and educational
purposes. Without limiting the foregoing, nothing in this Agreement may
be deemed to limit the right of Berkeley Lab to publish any technical
data resulting from any research performed by Berkeley Lab relating to
the Invention.
4. INFORMATION RIGHTS
4.1. Unless it is legally prohibited from doing so by statute or regulation
or contractual agreement with a research sponsor, Berkeley Lab upon
Licensee's reasonable request shall disclose to Licensee any of its
then-existing research data, clinical data, technical information and
other information that is necessary or useful in connection with the
manufacture, use or sale of any Licensed Product or the effective
exercise or use of the Licensed Patents and that is reasonably
accessible to the Berkeley Lab Technology Transfer Department. Licensee
shall have the non-exclusive, worldwide, no-cost right to use all such
information.
4.2. Berkeley Lab shall notify Licensee of any future Berkeley-[**]
Inventions (as defined below) within a reasonable period of time after
any such invention is reported to the Berkeley Lab Technology Transfer
Department, and in any case before Berkeley Lab enters into negotiations
to license rights to such inventions to third parties. Licensee
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acknowledges that this notification right does NOT require Berkeley Lab
to license to Licensee any rights to ANY future inventions. For the
purposes of this paragraph 4.2, "Berkeley-[**] Invention" means any
patentable invention (or group of inventions so linked as to form a
single general inventive concept), which (1) may be licensed to third
parties by the Xxxxxx Xxxxxxx Xxxxxxxx Berkeley National Laboratory,
acting on behalf of The Regents of the University of California; and (2)
was invented by [**], either alone or with others.
5. SUBLICENSING
5.1. Berkeley Lab also grants to Licensee the right to issue fee-bearing
(only to the extent specified in paragraphs 7.1 and 7.3) sublicenses
only in the Field of Use to make and have made, use and have used, offer
and have offered for sale, sell and have sold, and import and have
imported Licensed Products, so long as Licensee has current exclusive
rights in its Field of Use. Licensee may only grant sublicenses that are
no greater than the Field of Use to which Licensee is entitled. By way
of illustration, if Licensee grants a sublicense before the Field
Election Date, and Licensee does not thereafter extend its rights to the
Broader Field in accordance with paragraph 3.3, then the sublicensee's
rights after the Field Election Date can be no greater than the Specific
Applications Field.
5.2. Licensee shall incorporate terms into any sublicense Licensee grants
that are sufficient to enable Licensee to comply with this Agreement and
be consistent with all the rights and obligations due Berkeley Lab and
the United States Government under this Agreement, including, without
limitation, the license reserved by the United States Government.
5.3. Licensee shall provide Berkeley Lab with a copy of each sub
license
agreement executed under this Agreement. Licensee shall have the right
to redact terms from the sub
license agreement that are irrelevant to
this Agreement so long as it is apparent from the document furnished to
Berkeley Lab that the redactions are irrelevant to this Agreement.
5.4. If this Agreement terminates for any reason, each sublicense granted by
the Licensee in accordance with this Agreement shall remain in effect
subject to the terms of such sublicense and the terms of this Agreement.
Licensee shall assign each sublicense and Berkeley Lab shall assume it.
Notwithstanding the foregoing, Berkeley Lab shall not be obligated to
assume any sublicense that: (1) is in a state of breach as yet uncured
by the sublicensee or (2) conflicts with state or federal law or
Berkeley Lab's contract with DOE. Berkeley Lab shall in no event be
bound by any duties and obligations beyond those duties and obligations
assumed by Berkeley Lab in this Agreement and shall have all rights
against such sublicensee as provided with respect to Licensee in this
Agreement.
6. LICENSE ISSUE FEE
6.1. Licensee shall pay Berkeley Lab a license issue fee of $[**] (the
"License Issue Fee"). This License Issue Fee accrues on the Effective
Date, and Licensee shall pay this License Issue Fee as follows: $[**]
within 5 days of the Effective Date, $[**] by February 15, 2003, and
$[**] by August 15, 2003.
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6.2. This License Issue Fee is non-refundable and is not an advance against
royalties.
7. ROYALTIES AND PAYMENTS
7.1. Licensee shall pay to Berkeley Lab an earned royalty of the Selling
Price of each Licensed Product that Licensee, its Affiliate(s) or
sublicensee(s) sells as follows, based on cumulative sales of all
Licensed Products by Licensee, its Affiliate(s) and its sublicensees
over the lifetime of this Agreement.
7.1.1. [**]% of Selling Price for cumulative sales of Licensed Products
less than $[**];
7.1.2. [**]% of Selling Price for cumulative sales of Licensed Products
between $[**] and $[**]; and
7.1.3. [**]% of Selling Price for cumulative sales of Licensed Products
greater than $[**].
7.2. Under this Agreement a Licensed Product is considered as sold when
invoiced, or if not invoiced, when delivered to a third party Customer.
But when the last patent covering a Licensed Product expires or when the
license terminates, any shipment made on or before the day of that
expiration or termination that has not been billed out before is
considered as sold (and therefore subject to royalty). Berkeley Lab
shall credit royalties that Licensee pays on a Licensed Product that the
Customer does not accept or that the Customer returns.
7.3. In addition to the payments made under paragraph 7.1, for each
sublicense, Licensee shall pay Berkeley Lab the following:
7.3.1. [**]% of the up-front issue fee (excluding Related Research
Funding), if any, that it receives from a sublicensee for any
sublicense of the Licensed Patents;
7.3.2. [**]% of the annual maintenance fees (excluding Related Research
Funding), if any, that it receives from a sublicensee for
sublicense of the Licensed Patents; and
7.3.3. [**]% of milestone fees (excluding Related Research Funding), if
any, paid to Licensee by a sublicensee; provided that
achievement of such milestone, absent the license or sublicense,
would infringe a Valid Claim of the Licensed Patents.
7.4. Licensee shall pay to Berkeley Lab by August 31 of each year the
difference between the earned royalties for that calendar year Licensee
has already paid to Berkeley Lab (pursuant to paragraph 7.1) and the
minimum annual royalty set forth in the applicable schedule below.
Berkeley Lab shall credit that minimum annual royalty paid against the
earned royalty due and owing for the calendar year for which Licensee
made the minimum payment.
7.4.1. If Licensee does not extend its rights to the Broader Field
beyond the Field Election Date (i.e., Licensee has rights solely
in the Specific Application Field following the Field Election
Date), then the minimum annual royalty is as follows:
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Calendar Year Minimum Annual Royalty
----------------------------------------------- ----------------------
2002 $ [**]
2003 $ [**]
2004 $ [**]
2005 $ [**]
2006 $ [**]
2007 $ [**]
2008 $ [**]
2009 and each year thereafter $ [**]
7.4.2. If Licensee elects to extend its rights to the Broader Field
beyond the Field Election Date in accordance with paragraph 3.3,
then minimum annual royalty is as follows:
Calendar Year Minimum Annual Royalty
----------------------------------------------- ----------------------
2002 $ [**]
2003 $ [**]
2004 $ [**]
2005 $ [**]
2006 $ [**]
2007 $ [**]
2008 $ [**]
2009 and each year thereafter $ [**]
7.5. Licensee shall send payment for royalties accruing to Berkeley Lab
quarterly together with its royalty report under paragraph 9.3.
7.6. Licensee shall make checks payable to "The Regents of the University of
California (Berkeley Lab/L-03-1370)." Licensee shall pay Berkeley Lab
only in United States dollars. If a Licensed Product is sold for
currency other than United States dollars (not including Highly
Inflationary Currency), Licensee shall first determine the earned
royalties in the foreign currency of the country in which the Licensed
Product was sold and then convert them into equivalent United States
dollars at the closing exchange rate published by THE WALL STREET
JOURNAL on the last business day of the reporting period. If a Licensed
Product is sold for a Highly Inflationary Currency, Licensee shall
convert the sales subject to royalties into equivalent United States
funds using the closing exchange rates in effect on the date of
invoicing (or if no invoicing, of delivery) as published by THE WALL
STREET JOURNAL. Licensee shall quote the exchange rate in the
Continental method (local currency per U.S. dollar).
7.7. Licensee may not reduce royalties payable by any taxes, fees, or other
charges imposed on the remittance of royalty income. Licensee is also
responsible for all bank transfer charges.
7.8. If Licensee cannot promptly remit any royalties for sales in any country
where a Licensed Product is sold because of legal restrictions, upon
notice to Berkeley Lab, Licensee may deposit in United States funds
royalties due Berkeley Lab to Berkeley Lab's account in a bank or other
depository in that country. If Licensee is not permitted to deposit
those
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payments in U.S. funds under the laws of that country, Licensee may
deposit those payments in the local currency to Berkeley Lab's account
in a bank or other depository in that country.
7.9. If a court of competent jurisdiction and last resort holds invalid any
patent or any of the patent claims within a Licensed Patent in a final
decision from which no appeal has or can be taken, Licensee's obligation
to pay royalties based on that patent or claim will cease as of the date
of that final decision. Licensee, however, shall pay any royalties that
accrued before that decision or that are based on another patent or
claim not involved in that decision.
7.10. Licensee has no duty to pay Berkeley Lab royalties under this Agreement
on a Licensed Product Licensee sells to the United States Government
including any United States Government agency. Licensee shall reduce the
amount charged for a Licensed Product sold to the United States
Government by an amount equal to the royalty otherwise due Berkeley Lab.
8. PERFORMANCE REQUIREMENTS
8.1. Licensee shall, itself or through its Affiliates or sublicensees,
diligently proceed with the development, manufacture and sale of
Licensed Products and shall diligently endeavor to market them within a
reasonable time after the Effective Date in quantities sufficient to
meet the market demand.
8.2. Licensee shall make commercially reasonable efforts to obtain all
necessary governmental approvals for the manufacture, use and sale of
Licensed Products.
8.3. If Berkeley Lab determines that Licensee has not met any of the
diligence milestones listed in Exhibit C, taking into account any
amendments or extensions pursuant to paragraph 8.4, then Berkeley Lab
may either renegotiate those milestones in accordance with paragraph
8.4, terminate this Agreement if the breach is not cured in accordance
with the cure periods and other conditions of paragraph 12.1, or reduce
Licensee's limited exclusive license to a nonexclusive license in the
Field of Use.
8.4. Licensee and Berkeley Lab by mutual written consent may amend or extend
the requirements of Exhibit C at the written request of Licensee in
response to legitimate business or technical reasons.
9. PROGRESS AND ROYALTY REPORTS
9.1. Beginning May 31, 2003, and semi-annually thereafter, Licensee shall
submit to Berkeley Lab a progress report covering Licensee's activities
related to the development and testing of all Licensed Products and the
obtaining of the governmental approvals necessary for marketing Licensed
Products. Licensee shall make these progress reports until the later of
the completion of the milestones listed in Exhibit C or commercial sales
of any Licensed Product start.
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9.2. The progress reports Licensee submits under paragraph 9.1 must include,
but not be limited to, the following topics:
9.2.1. summary of work completed related to the requirements of
Exhibit C;
9.2.2. key scientific discoveries;
9.2.3. summary of work in progress;
9.2.4. current schedule of anticipated milestones; and
9.2.5. market plans for introduction of Licensed Products; and
9.2.6. number of full-time equivalent employees or agents (FTEs)
working on the development of Licensed Products and overall
number of FTEs employed by Licensee.
9.3. Upon the earlier of five years after the Effective Date or after the
first commercial sale of a Licensed Product anywhere in the world,
Licensee shall make quarterly royalty reports to Berkeley Lab on or
before February 28, May 31, August 31 and November 30 of each year. Each
royalty report must cover the most recently completed calendar quarter
and must show for all sales (or other disposition in accordance with
paragraph 2.9):
9.3.1. the Selling Price of each type of Licensed Product sold by
Licensee;
9.3.2. the number of each type of Licensed Product sold;
9.3.3. the royalties, in U.S. dollars, payable under this Agreement on
those sales;
9.3.4. the exchange rates used in calculating the royalty due;
9.3.5. the royalties on government sales that otherwise would have been
due under paragraph 7.10; and
9.3.6. for each sublicense, if any:
(1) the sublicensee;
(2) the information set forth in paragraphs 9.3.1 to 9.3.5 for
that sublicensee's sales or other disposition of Licensed
Product.
9.4. If no sales of Licensed Products have been made during any required
reporting period, Licensee shall make a statement to this effect.
10. BOOKS AND RECORDS
10.1. Licensee shall keep books and records accurately showing, to the extent
sufficient to support the reports required in paragraph 9.2, work
performed in satisfaction of the requirements of Exhibits A and C and
all Licensed Products manufactured, used, sold,
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imported or otherwise disposed of under the terms of this Agreement.
Licensee shall preserve those books and records for at least five years
from the date of the royalty payment to which they pertain and shall
open them to representatives or agents of Berkeley Lab, during normal
business hours, upon at least five (5) business days prior notice,
solely to verify any reports and payments made or compliance in other
respects under this Agreement. Inspections shall be limited to once per
calendar year. Licensee shall render, at Berkeley Lab's expense, all
assistance reasonably requested by Berkeley Lab for the purposes of
carrying out such inspections and examination of Licensee's royalty
payments and performance. Berkeley Lab shall maintain the results of any
audit as Confidential Information of Licensee pursuant to paragraph
15.3.
10.2. Berkeley Lab shall bear the fees and expenses of Berkeley Lab's
representatives performing the examination of the books and records. But
if the representatives discover an error in royalties of more than 5% of
the total royalties due for any year, then Licensee shall bear the
reasonable and actual fees and expenses of these representatives and the
difference between the earned royalties and the reported royalties
(which shall be subject to the provisions of Article 22 (LATE
PAYMENTS)). Notwithstanding the foregoing, if Berkeley Lab's
representatives performing the examination are not independent certified
public accountants and Licensee in good faith objects to the findings of
such representatives, Licensee shall not be liable for the fees,
expenses, and other payments of this paragraph 10.2, unless those
findings are confirmed by independent certified public accountants.
11. LIFE OF THE AGREEMENT
11.1. Unless otherwise terminated by acts of the parties in accordance with
the terms of this Agreement, this Agreement is in force from the
Effective Date and expires concurrently with the expiration, abandonment
or final adjudication of invalidity of all Licensed Patents, whichever
is later. Upon expiration (but not earlier termination) of this
Agreement, Licensee shall have a non-exclusive, worldwide, no-cost right
to use any information contained or described in the Licensed Patents
and any information acquired by Licensee pursuant to paragraph 4.1.
11.2. Any termination of this Agreement shall not affect the rights and
obligations set forth in the following Articles:
Article 10 Books and Records
Article 11 Life of the Agreement
Article 14 Disposition of Licensed Products on Hand upon Termination
Article 15 Use of Names and Nondisclosure of Agreement
Article 16 Limited Warranty
Article 21 Indemnification
Article 27 Export Control Laws
Article 29 Miscellaneous
11.3. Termination does not affect in any manner any rights of Berkeley Lab or
Licensee arising under this Agreement before the termination.
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12. TERMINATION BY EITHER PARTY
12.1. In the event of a breach of any material term of this Agreement, then
the non-breaching party may give written notice of such default
("Default Notice") to the breaching party. If the breaching party fails
to cure that default and provide the non-breaching party with reasonable
evidence of the cure within 90 days of the Default Notice (30 days in
the case of breach of payment obligations by Licensee), the
non-breaching party may terminate this Agreement and the licenses
granted by a second written notice ("Termination Notice") to the
breaching party after expiration of such cure period, and this Agreement
shall automatically terminate on the deemed effective date of receipt
(under Article 23) by the breaching party of the Termination Notice.
13. TERMINATION BY LICENSEE
13.1. Licensee at any time may terminate this Agreement for any reason by
giving written notice to Berkeley Lab. Licensee's termination notice
must indicate whether Licensee has any inventory of Licensed Products.
Licensee's termination of this Agreement will be effective 180 days
after its notice.
14. DISPOSITION OF LICENSED PRODUCTS UPON TERMINATION
14.1. Within 45 days of termination of this Agreement for any reason, Licensee
shall provide Berkeley Lab with a written inventory of all Licensed
Products in process of manufacture or in stock. Licensee shall dispose
of those Licensed Products within 120 days of termination. The sale of
any Licensed Product within the 120 days is subject to the terms of this
Agreement.
15. USE OF NAMES AND NONDISCLOSURE OBLIGATIONS
15.1. In accordance with California Education Code Section 92000, Licensee
shall not use in advertising, publicity or other promotional activities
any name, trade name, trademark, or other designation of the University
of California, nor shall Licensee so use "Xxxxxx Xxxxxxx Xxxxxxxx
Berkeley National Laboratory" or "Department of Energy" (including any
contraction, abbreviation, or simulation of any of the foregoing)
without Berkeley Lab's prior written consent.
15.2. Neither party may disclose the terms of this Agreement to a third party
without express written permission of the other party, except when
required under either the California Public Records Act or other
applicable law or court order. Notwithstanding anything to the contrary
in this Article 15, (i) either party may disclose the existence of this
Agreement and identity of the other party and the extent of the grant in
Article 3 (License Grant); (b) Berkeley Lab may disclose the terms of
this Agreement to the DOE; and (iii) Licensee may disclose the terms of
this Agreement to any Affiliate, any sublicensee or potential
sublicensee, or to any third party if necessary or desirable to assist
Licensee in building its business, in each case under a written
confidentiality agreement no less protective than the Mutual
Nondisclosure Agreement between the parties effective as of July 12,
2001 (the "Mutual NDA").
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15.3. All information Licensee is required to provide Berkeley Lab under this
Agreement, including but not limited to information listed in paragraphs
5.3, 9.1, and 9.3 of this Agreement, is deemed to be Confidential
Information.
15.3.1. Berkeley Lab will maintain the confidentiality of the
Confidential Information, and will not use the Confidential
Information for any purpose other than as necessary to
administer this Agreement.
15.3.2. The obligations of Berkeley Lab with respect to Confidential
Information will not apply to information disclosed under this
Agreement to the extent such information:
15.3.2.1. is disclosed in a proceeding to enforce Berkeley
Lab's rights under this Agreement;
15.3.2.2. is public knowledge at the time of disclosure or
becomes public knowledge through no wrongful act on
the part of Berkeley Lab;
15.3.2.3. is in Berkeley Lab's possession at the time of
disclosure;
15.3.2.4. is obtained by Berkeley Lab from a third party that
Berkeley Lab reasonably believes is not bound by
confidentiality obligations to Licensee;
15.3.2.5. is independently developed by Berkeley Lab without
reference to or reliance upon the information as can
be documented by written records; or
15.3.2.6. is required to be disclosed by Berkeley Lab to
comply with applicable laws or governmental
regulations, PROVIDED THAT the Berkeley Lab provides
prior written notice of such disclosure to the
Licensee and takes reasonable and lawful actions to
avoid and/or minimize the extent of such disclosure.
15.4. The provisions of this Article 15 relating to confidentiality shall be
in force and effect until 5 years following the termination of this
Agreement.
16. LIMITED WARRANTY
16.1. Berkeley Lab warrants to Licensee that it (a) is the sole owner of the
Licensed Patents and the Invention, and (b) has the lawful right to
grant the licenses granted herein. In addition to the notices and
disclaimers in this Article 16 (LIMITED WARRANTY), Licensee hereby
agrees and acknowledges that Berkeley Lab (i) has no responsibility or
obligation to conduct any prior art or infringement search with respect
to the Patent Rights; and (ii) Berkeley Lab makes no representation or
warranty, and assumes no liability, with respect to the validity or
non-infringement of the Patent Rights. In light of the foregoing, as of
the Effective Date of this Agreement, the Licensing Manager in Berkeley
Lab's Technology Transfer Department, who is responsible for the
negotiation of this Agreement, is not aware
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of any third party intellectual property for which the practice of the
Licensed Patents or the Invention would be an infringing act.
16.2. This license and the associated Invention are provided WITHOUT WARRANTY
OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR ANY OTHER
WARRANTY, EXPRESS OR IMPLIED. BERKELEY LAB MAKES NO REPRESENTATION OR
WARRANTY THAT LICENSED PRODUCTS WILL NOT INFRINGE ANY PATENT OR OTHER
PROPRIETARY RIGHT.
16.3. IN NO EVENT WILL EITHER PARTY BE LIABLE FOR ANY INCIDENTAL, SPECIAL OR
CONSEQUENTIAL DAMAGES RESULTING FROM EXERCISE OF THIS LICENSE OR THE USE
OF THE INVENTION OR LICENSED PRODUCTS, EVEN IF SUCH PARTY HAS BEEN
ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
16.4. Nothing in this Agreement may be construed as:
16.4.1. a warranty or representation by Berkeley Lab as to the validity
or scope of any of Berkeley Lab's rights in Licensed Patents;
16.4.2. a warranty or representation that anything made, used, sold or
otherwise disposed of under any license granted in this
Agreement is or will be free from infringement of any patents
other than Licensed Patents;
16.4.3. an obligation to bring or prosecute actions or suits against
third parties for patent infringement, except as specifically
provided for in Article 18 (Patent Infringement); or
16.4.4. a grant by implication, estoppel or otherwise of any license or
rights under any patents of Berkeley Lab other than Licensed
Patents, regardless of whether such patents are dominant or
subordinate to Licensed Patents;
16.4.5. an obligation to furnish any know-how not provided in Licensed
Patents (except for information as provided in paragraph 4.1).
17. PATENTING AND FOREIGN RIGHTS
17.1. Berkeley Lab shall prepare, file, prosecute and maintain patent
applications and patents relating to inventions included in the Licensed
Patents using patent counsel of its choice, and shall consult and
cooperate with Licensee in connection therewith. Berkeley Lab shall copy
Licensee promptly on all U.S.P.T.O. and foreign patent office actions so
that Licensee shall be informed of the continuing prosecution.
Notwithstanding the foregoing, Berkeley Lab may take any action useful
or necessary to obtain and preserve its patent rights in Licensed
Patents. Berkeley Lab shall use all reasonable efforts to amend any
patent application to include claims and/or legal arguments reasonably
requested by Licensee to protect the Licensed Products Licensee
contemplates selling. To the extent such information is not available to
the public, Licensee shall keep confidential documents from patent
offices and patent related filings and associated drafts.
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17.2. Licensee agrees to reimburse Berkeley Lab for Berkeley Lab's
out-of-pocket patent preparation, filing, prosecution and maintenance
costs. Such reimbursement includes costs of $[**] incurred through June
14, 2002, and other costs not to exceed $[**] incurred prior to the
Effective Date. Berkeley Lab shall provide Licensee with documentation
of patenting costs incurred when invoicing Licensee for those costs.
Licensee will reimburse Berkeley Lab within 30 days of invoicing.
Licensee's obligation to reimburse patent costs continues for so long as
this Agreement remains in effect, provided, however, that Licensee may
terminate its obligations under this Agreement with respect to any given
patent application or patent upon three months written notice to
Berkeley Lab. Berkeley Lab shall use reasonable efforts to curtail
patent costs when such a notice is received from Licensee. After such
notice or when this Agreement terminates, Berkeley Lab may continue
prosecution and/or maintenance of those application(s) or patent(s) at
its sole discretion and expense; provided, however, that Licensee will
have no further license or other right to them.
17.3. Licensee may request that Berkeley Lab seek patent protection on the
Licensed Patents in foreign countries if available. Berkeley Lab has no
obligation to take action to file foreign patent applications unless
Licensee provides written notice to Berkeley Lab at least six weeks
before any applicable bar and that notice states which countries,
regions or Patent Cooperation Treaty filing Licensee desires. If
Licensee timely provides such notice, then Berkeley Lab shall timely
make such foreign filings. The absence of the required notice from
Licensee to Berkeley Lab acts as an election not to secure foreign
rights.
17.4. Berkeley Lab may file patent applications at its own expense in any
country in which Licensee has not elected to secure patent rights. Those
applications and resultant patents shall not be subject to this
Agreement.
17.5. If Berkeley Lab fails to prepare, file, prosecute or maintain patent
applications or patents described in paragraphs 17.1 or 17.3, Licensee
shall have the right, upon prior written notice to Berkeley Lab, to
prepare, file, prosecute or maintain such patent applications or
patents, at Licensee's expense, in the name of Berkeley Lab.
17.6. Licensee shall promptly notify Berkeley Lab of any change in its status
as a small business concern and of the first sublicense granted to an
entity that does not qualify as a small business concern. A "small
business concern" as used in this paragraph is as defined by the U.S.
Patent and Trademark Office; currently, that is a company whose number
of employees, including affiliates, does not exceed 500 persons (13
C.F.R. 121.802).
18. PATENT INFRINGEMENT
18.1. If Licensee learns of the substantial infringement of any of Licensed
Patents, Licensee shall so inform Berkeley Lab in writing and shall
provide Berkeley Lab with reasonable evidence of the infringement.
During the period and in a jurisdiction where Licensee has exclusive
rights under this Agreement, neither party may notify a third party of
the infringement of any of Licensed Patents without first obtaining
written consent of the other party, which consent shall not be
unreasonably denied. Subject to paragraph 18.2, both
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parties shall use their reasonable efforts in cooperation with each
other to resolve such infringement without litigation.
18.2. Licensee may request that Berkeley Lab take legal action against the
infringement of Licensed Patents in the Field of Use in which Licensee
has exclusive rights under this Agreement. Licensee shall make that
request in writing and include reasonable evidence of the infringement
and damages to Licensee. If the infringing activity has not been abated
within 90 days of that request, Berkeley Lab may elect to: (a) commence
suit on its own account; or (b) refuse to participate in the suit.
Berkeley Lab shall give written notice of its election to Licensee by
the end of the 100th day after receiving notice of the request from
Licensee. Licensee may thereafter bring suit for patent infringement
only if Berkeley Lab elects not to commence suit and if the infringement
occurred during the period and in a jurisdiction where Licensee has
exclusive rights under this Agreement. If Berkeley Lab brings suit in
accordance with this paragraph, Licensee may thereafter join such suit,
at its own expense, and contribute up to fifty percent of the costs of
such suit. If Licensee elects to bring suit in accordance with this
paragraph, Berkeley Lab may thereafter join such suit, at its own
expense, and contribute up to fifty percent of the costs of such suit.
Subject to this paragraph 18.2, if required by law, each party shall
permit any action under this paragraph to be brought in its name,
including being joined as a nominal party-plaintiff, provided that the
other party shall hold such party harmless from, and indemnify the such
party against, any costs, expenses or liability that such party incurs
in connection with such action.
18.3. Such legal action as is decided upon must be at the expense of the party
on account of whom suit is brought and all consequent recoveries belong
to that party. But if Berkeley Lab and Licensee jointly bring legal
action and fully participate in it, the parties must jointly share the
expense and all recoveries shall be shared in proportion to the share of
expense each party pays.
18.4. Each party shall cooperate with the other in litigation proceedings
instituted under this Agreement but at the expense of the party on
account of whom suit is brought. The party bringing the suit will
control that litigation, including the settlement thereof, subject to
the right of Berkeley Lab to be represented by counsel of its choice in
any suit brought by Licensee, it being understood that Licensee will
still control litigation brought by it.
19. WAIVER
19.1. The waiver of any breach of any term of this Agreement does not waive
any other breach of that or any other term.
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20. ASSIGNMENT
20.1. This Agreement is binding upon and shall inure to the benefit of (a)
Berkeley Lab, its successors and assigns and (b) Licensee, its
successors and permitted assigns. This Agreement is personal to the
Licensee. Any attempt by Licensee to assign this Agreement is void
unless Licensee obtains the prior written consent of Berkeley Lab;
Berkeley Lab shall not unreasonably withhold that consent. Berkeley Lab
acknowledges that it shall not be reasonable for Berkeley Lab to
withhold its consent if the third party to whom Licensee desires to
assign this Agreement has the expertise and financial ability to exploit
the licenses granted under this Agreement (i.e., is not an entity with
limited assets and personnel). Notwithstanding the preceding sentence,
after Licensee has achieved the milestone described in Section 5 of
Schedule C, Licensee may assign this Agreement, upon written notice to
Berkeley Lab and without Berkeley Lab's consent, in conjunction with the
sale or transfer of all or substantially all of its assets related to
the commercialization of the Licensed Patents, or pursuant to a merger
or consolidation, to or into an entity which has agreed in writing to be
bound by all the terms and conditions of this Agreement.
21. INDEMNIFICATION
21.1. Licensee agrees to indemnify, hold harmless and defend Berkeley Lab and
the U.S. Government and their officers, employees, and agents; the
sponsors of the research that led to the Invention; and the inventors of
the patents and patent applications in Licensed Patents and their
employers against any and all claims, suits, losses, damage, costs,
fees, and expenses ("Claims") resulting from or arising out of
Licensee's or its Affiliates' exercise of this license or its
sublicensees' exercise of any sublicense, except to any indemnified
party to the extent that Claims result from the gross negligence or
willful misconduct of Berkeley Lab or its officers, employees, or
agents. Licensee shall pay all costs incurred by Berkeley Lab in
successfully enforcing this indemnification, including reasonable
attorney fees. The indemnity set forth herein shall apply only if
Licensee shall have been informed in writing as soon and as completely
as practical by Berkeley Lab and/or the Government of the action
alleging such Claim, the indemnified parties cooperate fully with
Licensee in the defense of any such Claim, and Licensee shall have been
given an opportunity, to the maximum extent afforded by applicable laws,
rules, or regulations, to control its defense and settlement. Neither
Licensee nor any indemnified party shall agree to any settlement of such
Claim that does not include a complete release of the other party(-ies)
from all liability with respect thereto or that imposes any liability,
obligation or restriction on such other party(-ies) without such other
party(-ies) consent unless required by final decree of a court of
competent jurisdiction. Licensee may participate in the defense of any
claim through its own counsel, and at its own expense.
21.2. Licensee, at its sole expense, shall insure its activities related to
this Agreement and obtain and keep in force Comprehensive or Commercial
Form General Liability Insurance (contractual liability and products
liability included) with limits as follows:
21.2.1. Each Occurrence $ 4,000,000
21.2.2. Products/Completed Operations Aggregate $ 5,000,000
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21.2.3. Personal and Advertising Injury $ 4,000,000
21.2.4. General Aggregate (commercial form only) $ 4,000,000
21.3. The coverages and limits referred to in this Article 21 do not in any
way limit the liability of Licensee. Licensee shall furnish Berkeley Lab
with certificates of insurance, including renewals, evidencing
compliance with all requirements at least 30 days prior to the first
commercial sale, clinical use, practice or distribution of a Licensed
Product.
21.3.1. If such insurance is written on a claims-made form, coverage
shall provide for a retroactive date of placement on or before
the Effective Date.
21.3.2. Licensee shall maintain the general liability insurance
specified during: (a) the period that the Licensed Product is
being commercially distributed or sold by Licensee or by a
sublicensee or agent of Licensee, and (b) a reasonable period
thereafter, but in no event less than five years.
21.4. The insurance coverage of paragraph 21.2 must:
21.4.1. Provide for 30-day advance written notice to Berkeley Lab of
cancellation or of any modification.
21.4.2. Indicate that DOE, "The Regents of the University of California"
and its officers, employees, students, agents, are endorsed as
additional insureds.
21.4.3. Include a provision that the coverages are primary and do not
participate with, nor are excess over, any valid and collectible
insurance or program of self-insurance carried or maintained by
Berkeley Lab.
22. LATE PAYMENTS
22.1. If Licensee does not make a payment to Berkeley Lab when due, Licensee
shall pay to Berkeley Lab such reasonable administrative fees and the
lesser of 10% simple interest per annum or the maximum permitted by law.
23. NOTICES
23.1. Any payment, notice or other communication this Agreement requires or
permits either party to give must be in writing to the appropriate
address given below or to such other address as one party designates by
written notice to the other party. The parties deem payment, notice or
other communication to have been properly given and to be effective (a)
on the date of delivery if delivered in person; (b) on the fourth day
after mailing if mailed by first-class mail, postage paid; (c) on the
second day after delivery to an overnight courier service such as
Federal Express, if sent by such a service; or (d) upon confirmed
transmission by telecopier. The parties' addresses are as follows:
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For Berkeley Lab:
Xxxxxxxx Berkeley National Laboratory
Technology Transfer Department
Mailstop 90-1070
Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxx 00000
Attention: Licensing Manager
Fax: 510/000-0000
Telephone: 510/000-0000
For Licensee:
Momenta Pharmaceuticals, Inc.
00 Xxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Vice President Licensing and Business Development
Fax: 617/000-0000
Telephone: 617/000-0000
24. U.S. MANUFACTURE
24.1. To the extent required by law, Licensee shall have Licensed Products
produced for sale in the United States manufactured substantially in the
United States so long as Licensee has current exclusive rights in the
Field of Use.
25. PATENT MARKING
25.1. Licensee shall xxxx all Licensed Products made, used or sold under this
Agreement, or their containers, in accordance with the applicable patent
marking laws.
26. GOVERNMENT APPROVAL OR REGISTRATION
26.1. If the law of any nation requires that any governmental agency either
approve or register this Agreement or any associated transaction,
Licensee shall assume all legal obligation to do so. Licensee shall
notify Berkeley Lab if it becomes aware that this Agreement is subject
to a U.S. or foreign government reporting or approval requirement.
Licensee shall make all necessary filings and pay all costs, including
fees, penalties, and all other costs associated with such reporting or
approval process.
27. EXPORT CONTROL LAWS
27.1. Licensee shall observe all applicable United States and foreign laws and
regulations with respect to the transfer of Licensed Products and
related technical data, including, without limitation, the International
Traffic in Arms Regulations (ITAR) and the Export Administration
Regulations.
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28. FORCE MAJEURE
28.1. If a party's performance required under this Agreement is rendered
impossible or unfeasible due to any catastrophes or other major events
beyond its reasonable control, including, without limitation, the
following, the parties are excused from performance: war, riot, and
insurrection; laws, proclamations, edicts, ordinances or regulations;
strikes, lockouts or other serious labor disputes; and floods, fires,
explosions, or other natural disasters. When such events xxxxx, the
parties' respective obligations under this Agreement must resume.
29. MISCELLANEOUS
29.1. The headings of the several sections are inserted for convenience of
reference only and are not intended to be a part of or to affect the
meaning or interpretation of this Agreement.
29.2. This Agreement is not binding upon the parties until it is signed below
on behalf of each party.
29.3. No amendment or modification hereof shall be valid or binding upon the
parties unless made in writing and signed on behalf of each party.
29.4. This Agreement and the Mutual NDA, which is incorporated herein by
reference, embody the entire and final understanding of the parties on
this subject matter. They supersede any previous representations,
agreements, or understandings, whether oral or written, relating to
their subject matter.
29.5. If a court of competent jurisdiction holds any provision of this
Agreement invalid, illegal or unenforceable in any respect, this
Agreement must be construed as if that invalid or illegal or
unenforceable provision is severed from the Agreement, provided,
however, that the parties shall negotiate in good faith substitute
enforceable provisions that most nearly effect the parties' intent in
entering into this Agreement.
29.6. This Agreement must be interpreted under the laws of the state of
California, without giving effect to any choice of law rules that would
result in the application of laws of any jurisdiction other than those
of the state of California, except that questions affecting the
construction and effect of any patent shall be determined by the law of
the country in which the patent is granted.
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Xxxxxxxx Lab and Licensee execute this Agreement in duplicate originals through
their duly authorized respective officers in one or more counterparts, that
taken together, are but one instrument.
THE REGENTS OF THE UNIVERSITY MOMENTA PHARMACEUTICALS, INC.
OF CALIFORNIA, THROUGH THE
XXXXXX XXXXXXX XXXXXXXX
BERKELEY NATIONAL LABORATORY
By: /s/ Piermaria Oddone By: /s/ Xxxxx X. Xxxxxxxxx
----------------------------- -----------------------------
(Signature) (Signature)
By Piermaria Oddone, Ph.D. By Xxxxx X. Xxxxxxxxx, Ph.D.
Title Deputy Laboratory Director Title Vice President, Licensing and
Business Development
Date 11/6/02
Date 11-20-02
Approved as to form
By: /s/ Xxxxx X. Xxxxx
-----------------------------
XXXXX X. XXXXX
XXXXXXXX BERKELEY NATIONAL LABORATORY
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EXHIBIT A
Diligence Milestones for Rights to Broader Field
1. Licensee shall have raised from inception at least $[**], in the aggregate,
from the sale of Licensee's equity securities for its own account and/or
from funding from corporate partners or sublicensees or otherwise.
2. Licensee shall have hired [**] its senior management team, acquired
expertise in [**] and employ a staff of [**] employees, of which at least
[**] have advanced science degrees (Ph.D. or M.D.)
3. Licensee shall have [**] using the Licensed Patents, either alone or in
collaboration with other parties.
4. Licensee shall have either (a) [**] such as a [**] in which [**] during the
course of the [**], or (b) [**] Licensee [**] using the Licensed Patents
[**].
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EXHIBIT B
Therapeutic Applications within Specific Applications Field
[**]therapies
[**] therapies
[**] therapies, including [**]
[**] therapies
[**] therapies
[**] therapies [**]
[**] therapies
[**] therapies
[**] therapies
[**] therapies
[**] therapies
[**] therapeutic applications
And any other field upon which the parties may mutually agree.
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EXHIBIT C
Diligence Milestones
1. Licensee shall permit an in-plant inspection by Berkeley Lab on or before
November 2002 and thereafter permit in-plant inspections by Berkeley Lab at
regular intervals with at least twelve (12) months between each inspection.
2. Licensee shall have raised from inception at least $[**] by [**] from the
sale of Licensee's equity securities for its own account.
3. In the aggregate, Licensee shall have raised from inception at least $[**]
by [**] from the sale of Licensee's equity securities for its own account
and from funding from corporate partners or sublicensees or otherwise.
4. Licensee shall fund, or shall cause its Affiliates, sublicensees and/or
corporate partners to fund, no less than $[**] toward the research,
development or commercialization of Licensed Products in each calendar year
(pro-rated for partial years) beginning in the calendar year [**] and
ending with calendar year [**].
5. Licensee shall have [**], or shall have caused its Affiliates or
sublicensees to [**], by [**]. In lieu of this requirement, Licensee shall
fund, or shall cause its Affiliates, sublicensees and/or corporate partners
to fund, no less than $[**] toward the research development or
commercialization of Licensed Products in calendar year [**].
6. Licensee shall fund, or shall cause its Affiliates, sublicensees and/or
corporate partners to fund, no less than $[**] toward the research,
development or commercialization of Licensed Products in each calendar year
(pro-rated for partial years) beginning in calendar year [**] and shall
continue such funding until the arms-length commercial sales of a Licensed
Product total in the aggregate at least $[**].
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