Confidential Treatment Requested. Confidential portions of this document have been redacted and have been separately filed with the Commission. ***** Confidential material redacted and filed separately with the Commission. LICENSE AND DEVELOPMENT...
Confidential
Treatment Requested. Confidential portions of this document have been redacted
and have been separately filed with the Commission.
*****
Confidential material redacted and filed separately with the
Commission.
THIS
LICENSE AND DEVELOPMENT AGREEMENT
is
entered into as of the 26th
day of
February, 2003 (the “Effective
Date”)
by and
between XTL BIOPHARMACEUTICALS LTD. (“XTL”),
and
B&C BIOPHARM CO., LTD. (“B&C”)
RECITALS
WHEREAS,
B&C
has certain intellectual property rights and know-how relating to the B&C
Compounds (as defined herein); and
WHEREAS,
XTL
desires to obtain an exclusive license to such intellectual property rights
and
know-how, and B&C desires to grant such a license on the terms and
conditions set forth herein.
NOW,
THEREFORE,
in
consideration of the foregoing and the covenants and promises contained herein,
the parties agree as follows:
ARTICLE
1.
DEFINITIONS
As
used
herein, the following terms shall have the following meanings:
1.1. “Affiliate”shall
mean any company or entity controlled by, controlling, or under common control
with a party hereto and shall include without limitation any company 50%
or more
of whose voting stock or participating profit interest is owned or controlled,
directly or indirectly, by a party, and any company which owns or controls,
directly or indirectly, 50% or more of the voting stock of a party.
1.2. “Asia”
shall
mean those countries set forth on Schedule
A.
1.3. “B&C
Compounds”
shall
mean the compounds referred to by B&C as *****.
1.4. “FDA”
shall
mean the United States Food and Drug Administration or any other governmental
agency of a country within the Licensed Territory having responsibilities
comparable to those of the United States Food and Drug
Administration.
1.5. “Field”
shall
mean all therapeutic uses against HCV.
1.6. “HCV”
shall
mean the Hepatitis C virus.
1.7. “Licensed
Know-How”
shall
mean (a) tangible or intangible know-how; (b) trade secrets,
inventions (whether or not patentable); (c) data; (d) preclinical
and
clinical results; (e) other information; and (f) any physical,
chemical or biological material and any replication or any part of such
material; limited, however, to that which is necessary or useful for the
development, manufacture, use or sale of Licensed Product, and which B&C
owns, controls or has a license (with the right to sublicense) on or after
the
Effective Date.
*****
Confidential material redacted and filed separately with the
Commission.
1.8. “Licensed
Patents”
shall
mean all patents, both foreign and domestic, including without limitation
all
substitutions, extensions, reissues, re-examinations, renewals and inventors
certificates and all patent applications (including provisionals, divisionals,
continuations and continuations-in-part), which B&C owns, controls or has a
license (with the right to sublicense) on or after the Effective Date, that
would be infringed by the development, manufacture, use, import, offer for
sale
or sale of Licensed Product in the Field in the Licensed Territory, including
without limitation those patents and any patents issuing on those patent
applications listed on Schedule C
hereto.
1.9. “Licensed
Product”shall
mean any product incorporating a B&C Compound.
1.10. “Licensed
Technology”
shall
mean the Licensed Patents and the Licensed Know-How.
1.11. “Licensed
Territory”
shall
mean the Rest of the World and Japan.
1.12. “Net
Royalty Payments”shall
mean the royalty payments actually received by XTL from its sublicensees
for
sales of Licensed Product, net of any amounts XTL shall be required to pay
to
third parties with respect to such sales.
1.13. “Net
Sales”
shall
mean all revenues actually received by XTL, its Affiliates or its sublicensees
from the sale of Licensed Product, after deduction for transportation charges,
commissions, discounts, credits allowed for defective or returned or recalled
goods and other allowances (actually paid or allowed, including but not limited
to, prompt payment and volume discounts, charge backs from wholesalers),
insurance and sales and other taxes based on sales prices when included in
gross
sales, but not including taxes assessed on income derived from such sales.
1.14. “Net
Sublicense Payments”
shall
mean license fees, milestones and similar payments, other than royalty payments,
actually received by XTL from its sublicensees, but excluding (a) payments
made
to XTL if said payments are designed to pay for research and development
costs
to be incurred under, and then actually incurred after the date of, the
agreement under which said payments are made and (b) equity investments in
XTL.
These payments shall be on amounts net of any payments XTL shall be required
to
make to third parties with respect to such license fees, milestones and other
similar payments. By way of illustration, if XTL receives $100 in license
fees
from a sublicensee of the B&C Compounds, and XTL is required to pay $10 to
third parties, XTL shall pay $***** to B&C (*****).
1.15. “Phase
I Clinical Trials”shall
mean the initial human studies for a Licensed Product required by FDA to
ascertain safety of the Licensed Product.
1.16. “Phase
III Clinical Trials”
shall
mean the expanded human studies necessary for filing with, and (if successful)
approval of marketing by, FDA of a Biologics License Application or New Drug
Application (or corresponding application, registration or certification
outside
of the United States) for a Licensed Product.
1.17. “Rest
of the World”shall
mean all the countries of the world excluding Asia.
2
*****
Confidential material redacted and filed separately with the
Commission.
1.18. “Valid
Claim”
shall
mean a patent claim contained in an issued and unexpired patent which has
not
lapsed or been declared invalid or unenforceable by a court in a decision
which
is unappealable or not appealed.
ARTICLE
2.
LICENSES;
DEVELOPMENT AND COMMERCIALIZATION
2.1. GRANT
BY B&C TO XTL.
(a) Subject
to the terms of this Agreement, B&C hereby grants to XTL an exclusive
license, with the right to sublicense, under the Licensed Technology to make,
have made, use, sell, offer to sell and import Licensed Product in the Field
within the Licensed Territory.
(b) B&C
hereby agrees to grant a license, with the right to sublicense, under the
Licensed Technology to XTL, a third party or a separate entity formed by
the
parties, as may be agreed by the parties pursuant to Section
2.2(b)
with
respect to development and commercialization of Licensed Product in the
countries of Asia, excluding Japan and Korea.
2.2. DEVELOPMENT
AND COMMERCIALIZATION OF LICENSED PRODUCT.
(a) As
between the parties, B&C shall retain all development and commercialization
rights to the B&C Compounds in Korea and shall be solely responsible for all
costs associated with any such efforts; provided that (i) all clinical studies
conducted by B&C or its Affiliates of products incorporating B&C
Compounds shall be designed by B&C in collaboration with XTL, (ii) B&C
shall keep XTL informed of the ongoing progress of all such clinical studies
on
a current basis, (iii) B&C shall promptly provide XTL with complete data
from such clinical studies and (iv) upon the written request of XTL, B&C
shall promptly provide XTL with all data from pre-clinical studies of B&C
Compounds which XTL has chosen for clinical development, including, without
limitation, toxicity, pharmacokinetics and biological activity data. XTL
shall
have the right to use such data solely for its submissions seeking regulatory
or
marketing approval of B&C Compounds outside of Korea.
(b) Within
the countries of Asia, but excluding Japan and Korea, (i) XTL and B&C shall
jointly develop and commercialize Licensed Product in the Field, (ii) the
parties shall license the B&C Compounds to a third party for development and
commercialization in the Field, or (iii) XTL and B&C shall form a separate
entity to develop and commercialize B&C Compounds in the Field, as mutually
agreed and as may be required or advisable due to legal and tax requirements.
In
each case, B&C and XTL shall equally share all costs for development and
commercialization of products incorporating B&C Compounds in all such
countries as well as all revenues received therefrom.
(c) XTL
shall
be responsible for the development and commercialization of Licensed Product
in
the Field in the Licensed Territory, either on its own or by licensing to
or
collaborating with one or more third parties; provided that (i) XTL shall
keep
B&C informed on a current basis of the ongoing progress of all clinical
studies conducted by XTL or its Affiliates of products incorporating B&C
Compounds, (ii) XTL shall promptly provide B&C with complete data from such
clinical studies and (iii) upon the written request of B&C, XTL shall
promptly provide B&C with all data from pre-clinical studies of B&C
Compounds which B&C has chosen for clinical development in Korea, including,
without limitation, toxicity, pharmacokinetics and biological activity data.
B&C shall have the right to use such data solely for its submissions seeking
regulatory or marketing approval of B&C Compounds in Korea.
3
*****
Confidential material redacted and filed separately with the
Commission.
(d) In
Japan,
B&C shall receive annual payments equal to 50% of all revenues derived by
XTL from the development and commercialization of products incorporating
a
B&C Compound for so long as the composition of matter of the B&C
Compound is covered by a Valid Claim of a Licensed Patent in Japan; provided
that no such payments shall be made until XTL has offset 50% of all costs
incurred in the development and commercialization of such products.
(e) In
the
Rest of the World, the costs of development and commercialization shall be
fully
borne by XTL.
(f) Solely
for purposes of clarification, the parties’ respective rights under this
Section
2.2
are
summarized on Schedule
D
attached
hereto.
2.3. DUE
DILIGENCE.
Subsequent to XTL’s filing of an Investigational New Drug Application with the
FDA, or comparable foreign filing, for a Licensed Product, XTL and its
Affiliates and any sublicensees for the Licensed Product shall use commercially
reasonable efforts to develop and commercialize the Licensed Product. The
parties hereby agree that XTL’s due diligence obligations in this Section
2.3
shall be
deemed to be fully satisfied upon XTL’s and its Affiliates and sublicensees
spending, in the aggregate, at least U.S. $500,000 per year on the development
and commercialization of the Licensed Product.
2.4. ADDITIONAL
B&C COMPOUNDS SUPPLY AND SUPPORT.
(a) Additional
B&C Compounds.
From the
Effective Date until May 21, 2004, B&C shall keep XTL informed of any
meaningful developments related to any compound in the ***** set forth on
Schedule
B
which
shows potential activity against HCV, and shall promptly provide XTL with
a
report for each such compound, which will include all relevant data regarding
its activity against HCV. If XTL determines in good faith that one or more
such
compound(s) show(s) adequate therapeutic index and display pharmacokinetic
properties, XTL shall promptly notify B&C of its determination, and, upon
such notification, (i) B&C shall promptly supply to XTL at least 5
grams of each such compound and, to the extent not already provided to XTL,
related HPLC, mass spectrometry and chemical structure information and (ii)
Schedule
B
shall be
deemed to be automatically amended to reflect the addition of such compound
as a
B&C Compound. From the Effective Date until May 21, 2004, B&C shall
maintain an active program to develop analogs of *****.
(b) Supply
of B&C Compounds for Additional Studies.
Upon any
request by XTL for additional quantities of any B&C Compound or other
compound owned or licensed by B&C to be used by XTL as a negative control,
for toxicological, pharmacological or other non-clinical studies, B&C shall
use best efforts to (i) satisfy any such request within one month of the
request, and (ii) promptly supply XTL with sufficient chemical synthesis
information to enable XTL to manufacture or have manufactured the requested
compound. XTL’s request shall state the intended use for such additional
quantities of B&C Compounds or other compounds, and XTL warrants that the
B&C Compounds or other compounds will be used solely for the stated uses.
XTL shall reimburse B&C for its direct reasonable costs incurred in
supplying such additional quantities to XTL, such costs not to exceed a price
of
US $4,000 per 50 grams.
4
*****
Confidential material redacted and filed separately with the
Commission.
(c) Development
Support.
B&C
shall support XTL’s development of the B&C Compounds as set forth on
Schedule
E.
2.5. NONCOMPETITION.
During
the term of this Agreement, B&C shall not, directly or indirectly, e.g., as
a consultant, agent, principal, partner, joint venturer, or stockholder,
develop
or commercialize any products incorporating B&C Compounds in the Field or
grant any licenses to third parties for the development or commercialization
of
any products incorporating B&C Compounds in the Field, except as permitted
under Section
2.2(a)
for the
development and commercialization of B&C Compounds in Korea or Section
2.2(b)
as
agreed to by the parties with respect to the development and commercialization
of B&C Compounds in Asia (excluding Japan and Korea).
2.6. RIGHT
OF FIRST NEGOTIATION.
Until
the third anniversary
of the Effective Date, B&C shall notify XTL in writing of any new compounds
owned or licensed by B&C that have potential activity in the Field
(“New
Compounds”)
and
shall provide XTL with (1) all HPLC, mass spectrometry and chemical structure
information for each such compound and (ii) 5 grams of each New Compounds
for
XTL’s initial evaluation. Upon notice from XTL at any time within 120 days after
XTL’s receipt of 5 grams of a New Compound and the required information with
respect to such compound, XTL and B&C shall enter into good faith
negotiations to enter into an exclusive license to XTL to make, have made,
use,
sell, offer to sell and import products incorporating the New Compound in
the
Field within the Licensed Territory. The terms for such license shall be
no less
favorable to XTL than those contained herein.
ARTICLE
3.
COMMERCIAL
TERMS
3.1. LICENSE
FEE. XTL
shall
pay to B&C a license fee of US $***** (the “License Fee”), payable within 30
days of the Effective Date after B&C has complied with, provided that
B&C has theretofore complied with its obligations under items 1, 2 and 3 of
Schedule
E.
3.2. MILESTONES.
As
nonrefundable advances against the royalties payable to B&C pursuant to
Section
3.3,
XTL
shall make payments to B&C in connection with the following
milestones:
|
Milestone
|
Payment
|
|
|
*****
|
|
U.S.
$*****
|
|
|
|
|
|
*****
|
|
U.S.
$*****
|
|
|
|
|
|
*****
|
|
U.S.
$*****
|
|
|
|
|
|
*****
|
|
U.S.
$*****
|
5
*****
Confidential material redacted and filed separately with the
Commission.
3.3. ROYALTIES.
XTL
shall
pay to B&C within 90 days after the end of each calendar year, royalties on
Net Sales in each country within the Rest of the World where the composition
of
matter of the B&C Compounds incorporated in the Licensed Product is covered
by a Valid Claim of a Licensed Patent, as follows:
(a) If
sales
of Licensed Product are made by XTL or an XTL Affiliate (either directly
or
indirectly through a distributor), ***** of Net Sales by XTL or its Affiliate;
(b) If
sales
of Licensed Product are made by a sublicensee of XTL, the lesser of (i) *****
of
Net Royalty Payments or (ii) ***** of Net Sales by such sublicensee;
and
(c) *****
of
Net Sublicense Payments.
3.4. REDUCTION
FOR MILESTONE PAYMENTS.
XTL
shall have the right to reduce the royalty payments due to B&C under
Section
3.3
to
offset the full amount of the payments advanced by XTL to B&C pursuant to
Section
3.2;
provided, however, that the annual royalties otherwise payable pursuant to
Section
3.3
shall
not be reduced by more than *****. To the extent that any such advance payments
made by XTL are not fully offset by a reduction in the royalty payments made
by
XTL for any year, XTL shall be entitled to carry forward the amount not so
covered to subsequent years until the full amount of such advances is
offset.
3.5. ROYALTY
TERM.
The
royalties payable under Section 3.3
shall be
paid to B&C until the last to expire Licensed Patent, on a
country-by-country basis.
ARTICLE
4.
PAYMENTS;
RECORDS; AUDIT
4.1. PAYMENTS;
REPORTS.
All
amounts payable under this Agreement shall be paid in U.S. Dollars. Each
payment
of royalties by XTL shall be accompanied by a statement of the amount of
Net
Sales, Net Royalty Payments and Net Sublicensee Payments received during
such
period, and all other information necessary to determine the appropriate
amount
of such payments.
4.2. EXCHANGE
RATE.
The rate
of exchange to be used in computing the amount of currency equivalent in
United
States Dollars due hereunder shall be made at the average rate of exchange
quoted for the final 20 business days of the royalty period by Citibank (or
its
successor) in New York City.
4.3. RECORDS
AND AUDIT.
During
the term of this Agreement and for a period of two years thereafter, XTL
shall
keep complete and accurate records in sufficient detail to permit B&C to
confirm the accuracy of all payments due hereunder. B&C shall have the right
to retain an independent, certified public accountant, reasonably satisfactory
to XTL, to audit such records to confirm XTL’s Net Sales, Net Royalty Payments
and Net Sublicensee Payments; provided however, that
such
auditor shall not disclose XTL’s confidential information to B&C, except to
the extent such disclosure is necessary to verify the amount of royalties
due
under this Agreement. Such audits may be exercised not more than once a year,
within two years after the royalty period to which such records relate, upon
reasonable advance notice to XTL and during normal business hours. B&C shall
bear the full cost of any such audit unless the audit discloses a variance
of
more than 10% from the amounts previously paid by XTL for any royalty period.
In
such case, XTL shall bear the full cost of such audit.
6
*****
Confidential material redacted and filed separately with the
Commission.
4.4. WITHHOLDING
OF TAXES.
Any
withholding of taxes levied by applicable tax law on the payments hereunder
shall be borne by B&C and deducted by XTL from the sums otherwise payable by
it hereunder for payment to the proper tax authorities on behalf of B&C. XTL
agrees to cooperate with B&C in the event B&C claims exemption from such
withholding or seeks application of a reduced withholding tax rate under
any
double taxation or other similar treaty or agreement from time to time in
force,
such cooperation to consist of providing receipts of payment of such withheld
tax or other documents reasonably available to XTL.
ARTICLE
5.
OWNERSHIP;
PATENTS
5.1. PATENT
PROSECUTION. B&C
shall have the responsibility for preparing, filing, prosecuting and maintaining
the Licensed Patents and conducting any interferences, reexaminations or
requesting reissues or patent term extensions with respect to the Licensed
Patents. B&C shall keep XTL fully informed as to the status of such patent
matters, including without limitation by providing XTL with the opportunity
to
review and comment on any documents which will be filed in any patent office
and
by providing XTL copies of any documents received by B&C from such patent
offices including notices of all interferences, reexaminations, oppositions
or
requests for patent term extensions. XTL shall cooperate with and assist
B&C
in connection with such activities, at B&C’s request and expense. In the
event that B&C declines or fails to prepare, file, prosecute or maintain any
Licensed Patents, including patent applications, which, if filed, would be
included in the Licensed Patents, B&C shall promptly, and in no event later
than 90 days prior to any filing deadline, provide written notice to XTL.
XTL
shall have the right to assume such responsibilities at its own expense using
counsel of its choice. In addition, B&C shall immediately notify XTL of any
decision to abandon a Licensed Patent, in which case, XTL shall have the
option,
at its expense and with counsel of its choice, of continuing to prosecute
any
such pending patent application or of keeping the issued patent in force.
XTL
may fully credit any expenses incurred by XTL in assuming the responsibilities
for these patent activities against the $***** payment set forth in Section
3.2.
5.2. INFRINGEMENT
OF LICENSED PATENTS BY THIRD PARTIES.
(a) Notice.
Each
party shall promptly notify the other in writing of any alleged or threatened
infringement of the Licensed Patents which may adversely impact the rights
of
the parties hereunder, of which it becomes aware. The parties will meet to
discuss the appropriate course of action, and may collaborate in pursuing
such
course of action.
7
*****
Confidential material redacted and filed separately with the
Commission.
(b) Enforcement
Action. If
the
parties do not otherwise agree on a course of action, B&C shall have the
first right, but not the obligation, to take appropriate action against any
person or entity directly or contributorily infringing such Licensed Patent.
B&C shall keep XTL reasonably informed of the progress of any such claim,
suit or proceeding. In the event B&C fails to institute an infringement suit
or take other reasonable action in response to an infringement in any country
other than Korea within 30 days, XTL shall have the right to institute such
claim, suit or proceeding or take other appropriate action, and may join
B&C
as party plaintiff, if appropriate. Regardless of which party brings the
action,
the other party hereby agrees to cooperate reasonably in any such effort,
including if required to bring a legal action, the furnishing of a power
of
attorney and shall have the right to participate in such action at its own
expense with its own counsel. Any recovery obtained by settlement or otherwise
shall be disbursed as follows. Each party shall first recover any reasonable
expenses incurred in such action (including counsel fees). Thereafter, the
parties shall share any remaining recovery, with (i) 90% of such remaining
recovery going to XTL and 10% to B&C with respect to actions in the Rest of
the World and (ii) such remaining recovery being split 50%/50% between XTL
and
B&C with respect to actions in Asia (excluding Korea). Neither party shall
enter into any settlement that affects the other party’s rights or interests
without such other party’s written consent, which consent shall not be
unreasonably withheld.
5.3. INFRINGEMENT
OF THIRD PARTY PATENT RIGHTS.
(a) Licensed
Territory.
(i) Joint
Strategy. In
the
event that the manufacture, use or sale of Licensed Product becomes the subject
of a claim of infringement of a patent, copyright or other proprietary right
in
the Licensed Territory, and without regard to which party is charged with
said
infringement, and the venue of such claim, the parties shall promptly confer
to
discuss the claim.
(ii) Defense.
Unless
the parties otherwise agree, XTL shall assume the primary responsibility
for the
conduct of the defense of any such claim in the Licensed Territory. In any
event, B&C shall have the right, but not the obligation, to participate in
any such suit at its sole option and at its own expense. Each party shall
reasonably cooperate with the party conducting the defense of the claim
including, if required to conduct such defense, furnishing a power of attorney.
Neither party shall enter into any agreement, license or settlement that
affects
the other party’s rights or interests without such other party’s written
consent, which consent shall not be unreasonably withheld.
(b) Asia
(Excluding Japan and Korea). In
the
event that the manufacture, use or sale of Licensed Product becomes the subject
of a claim of infringement of a patent, copyright or other proprietary right
in
Asia (excluding Japan and Korea), the parties shall promptly confer to discuss
the claim, and the parties will cooperate with each other in the defense
of any
such claim. Neither party shall enter into any agreement, license or settlement
that affects the other party’s rights or interests without such other party’s
written consent, which consent shall not be unreasonably withheld
8
*****
Confidential material redacted and filed separately with the
Commission.
(c) Korea.
In the
event that the manufacture, use or sale of Licensed Product becomes the subject
of a claim of infringement of a patent, copyright or other proprietary right
in
Korea, B&C shall assume the primary responsibility for the conduct of the
defense of any such claim. In any event, XTL shall have the right, but not
the
obligation, to participate in any such suit at its sole option and at its
own
expense. Each party shall reasonably cooperate with the party conducting
the
defense of the claim including, if required to conduct such defense, furnishing
a power of attorney. Neither party shall enter into any agreement, license
or
settlement that affects the other party’s rights or interests without such other
party’s written consent, which consent shall not be unreasonably
withheld.
(d) XTL
Payment Credit Regarding Claims by Third Parties. XTL
may
fully credit against royalties otherwise due B&C under Section 3.3
of this
License Agreement, all payments made or expenses incurred by XTL under this
Article
5,
including any royalties paid to third parties as a result of such claims.
To the
extent that any such payments or expenses incurred by XTL are not fully offset
by a reduction in the royalty payments otherwise due B&C for any year, XTL
shall be entitled to carry forward the amount so covered to subsequent years
until the full amount of such payments and expenses is offset.
ARTICLE
6.
CONFIDENTIALITY
6.1. CONFIDENTIALITY.
Except
as required by regulatory or governmental agencies, all proprietary information
disclosed by either party to the other hereunder shall be received by the
receiving party (including all appropriate employees, agents and independent
contractors) in strictest confidence and used solely in furtherance of this
Agreement, and shall be accorded the same degree of confidentiality and secrecy
with which the receiving party holds its own most confidential information
of a
similar nature but in no event less than reasonable care. Such confidential
information shall not be disclosed to any persons other than (a) employees
or
agents of the receiving party or independent contractors employed by the
receiving party who have reasonable need for access to such information in
connection with the receiving party’s performance under this Agreement and who
are bound to the receiving party by a written agreement of confidentiality
containing terms consistent with those contained in this Article
6;
and (b)
governmental authorities, as required, to obtain necessary regulatory
clearances. Information shall not be deemed to be proprietary information
and
such restrictions shall not apply to any such information (i) which is, or
subsequently may become, within the knowledge of the general public, without
the
fault of the receiving party; (ii) which is known to the receiving party
prior
to the time of receipt thereof from the disclosing party, as shown by written
records; (iii) which is proved to have been developed by the receiving party,
independently and wholly without resort to the proprietary information of
the
disclosing party, as shown by written records; or (iv) which is subsequently
rightfully obtained from sources other than the disclosing party and without
confidential restriction in favor of the disclosing party.
9
*****
Confidential material redacted and filed separately with the
Commission.
ARTICLE
7.
REPRESENTATIONS
AND WARRANTIES
7.1. REPRESENTATIONS
AND WARRANTIES OF B&C.
(a) Corporate
Power. B&C
is duly organized and validly existing under the laws of Korea and has full
corporate power and authority to enter into this Agreement and to carry out
the
provisions hereof.
(b) Due
Authorization. B&C
is duly authorized to execute and deliver this Agreement and to perform its
obligations hereunder. The person executing this Agreement on B&C’s behalf
has been duly authorized to do so by all requisite corporate
action.
(c) Binding
Agreement. This
Agreement is a legal and valid obligation binding upon B&C and enforceable
in accordance with its terms. The execution, delivery and performance of
this
Agreement by B&C does not conflict with any agreement, instrument or
understanding, oral or written, to which it is a party or by which it may
be
bound, nor violate any material law or regulation of any court, governmental
body or administrative or other agency having jurisdiction over
him.
(d) Grant
of Rights. B&C
has not, and will not during the term of this Agreement, grant any right
to any
third party which would conflict with the rights granted to XTL
hereunder.
(e) Validity.
B&C
is aware of no action, suit or inquiry or investigation instituted by any
governmental agency which questions or threatens the validity of this
Agreement.
(f) Ownership.
B&C
owns or holds licenses to the Licensed Patents and Licensed Know-How and
has
sufficient rights and power to grant the licenses to XTL which it purports
to
grant herein.
(g) Third
Party Rights. B&C
has, as of the Effective Date, no knowledge of any third party patent right
which would be infringed by the use or commercialization of the B&C
Compounds as contemplated hereby.
7.2. REPRESENTATIONS
AND WARRANTIES OF XTL.
(a) Corporate
Power. XTL
is
duly organized and validly existing under the laws of the State of Israel
and
has full corporate power and authority to enter into this Agreement and to
carry
out the provisions hereof.
(b) Due
Authorization. XTL
is
duly authorized to execute and deliver this Agreement and to perform its
obligations hereunder. The person executing this Agreement on XTL’s behalf has
been duly authorized to do so by all requisite corporate action.
10
*****
Confidential material redacted and filed separately with the
Commission.
(c) Binding
Agreement. This
Agreement is a legal and valid obligation binding upon XTL and enforceable
in
accordance with its terms. The execution, delivery and performance of this
Agreement by XTL does not conflict with any agreement, instrument or
understanding, oral or written, to which it is a party or by which it may
be
bound, nor violate any material law or regulation of any court, governmental
body or administrative or other agency having jurisdiction over it.
(d) Validity.
XTL
is
aware of no action, suit, or inquiry or investigation instituted by any
governmental agency which questions or threatens the validity of this
Agreement.
ARTICLE
8.
TERM;
TERMINATION
8.1. TERM.
Except
as provided under Section 8.2
below, the term of this Agreement shall commence upon the Effective
Date
and shall expire on the expiration date of the last to expire payment obligation
under Section
2.2(c)
and
Article
3,
and,
upon expiration of this Agreement, XTL shall have a fully paid, nonexclusive
license to use any Licensed Technology then being used by XTL, solely for
the
purpose of developing, making, using and selling Licensed Product in the
Field
within the Licensed Territory.
8.2. TERMINATION
BY XTL. XTL
may
terminate this Agreement and the license granted herein, in its entirety
or as
to any particular Licensed Patent in a particular country, at any time, by
providing B&C with 90 days prior written notice. In addition, XTL shall have
the right to terminate this Agreement upon written notice to B&C in the
event B&C is in material breach of any of its obligations hereunder, unless
B&C cures the breach within 60 days after the date written notice thereof
was given by XTL to B&C.
8.3. TERMINATION
BY B&C.
B&C
shall have the right to terminate this Agreement upon written notice to XTL
in
the event XTL is in material breach of any of its payment obligations pursuant
to Article
3,
unless
XTL cures the breach within 60 days after the date written notice thereof
was
given by B&C to XTL.
8.4. ACCRUED
RIGHTS; SURVIVING OBLIGATIONS.
Termination of this Agreement shall not affect any accrued rights of either
party. The terms of Sections 2.6,
4.3, 8.1, 8.6, 8.7, 10.1
and
10.3
and
Articles 6
and 9
of this
Agreement shall survive termination of this Agreement.
8.5. TERMINATION
UPON BANKRUPTCY.
XTL
shall have the right to terminate this License Agreement immediately upon
any of
the following events: (i) B&C goes into liquidation, (ii) a receiver is
appointed for all or a portion of the property or estate of B&C, (iii)
B&C files a voluntary petition for bankruptcy or insolvency, (iv) a petition
for bankruptcy or insolvency is filed against B&C, (v) B&C makes an
assignment for the benefit of its creditors or (vi) B&C experiences an
equivalent event.
8.6. INSOLVENCY.
If,
during the term of this Agreement, B&C becomes insolvent (that is, its total
liabilities exceed its total assets), upon written notice from XTL and payment
by XTL to B&C of U.S.$*****, minus all payments made by XTL to B&C
pursuant to this Agreement, B&C agrees to grant and hereby grants a
perpetual, irrevocable, fully paid, exclusive license to use any Licensed
Technology then being used by XTL, solely for the purpose of developing,
making,
using and selling Licensed Product in the Field within the Licensed Territory.
B&C shall notify XTL in writing within five days of becoming insolvent.
Furthermore, B&C shall provide XTL with B&C’s balance sheet for each
fiscal quarter within 30 days after the end of such quarter.
11
*****
Confidential material redacted and filed separately with the
Commission.
8.7. TERMINATION
BY RECEIVER OR TRUSTEE.
Concurrently with the termination of this Agreement by a
bankruptcy/reorganization trustee or receiver on behalf of B&C, XTL shall
automatically be granted, and B&C agrees to grant and hereby grants to XTL,
a perpetual, irrevocable, fully paid, exclusive license to use any Licensed
Technology then being used by XTL, solely for the purpose of developing,
making,
using and selling Licensed Product in the Field within the Licensed Territory,
subject to payment by XTL to B&C of U.S.$*****, minus all payments made by
XTL to B&C pursuant to this Agreement, within 60 days after the date XTL
receives notice of such termination.
ARTICLE
9.
INDEMNIFICATION
9.1. INDEMNIFICATION
BY B&C.
(a) B&C
shall defend, indemnify and hold harmless XTL and its Affiliates, and their
respective officers, directors, agents, employees and representatives, from
and
against any and all third-party claims, suits, actions, demands, liabilities
and
expenses (“Claims”),
including any attorneys’ fees and expenses of litigation related thereto,
arising from any breach of B&C’s representations and warranties set forth in
Section
7.1.
B&C’s obligations under this Section
9.1
shall be
in addition to any other remedies XTL may have elsewhere under this Agreement
or
at law or in equity with respect to such breach.
(b) B&C
shall not settle any Claims for which it is obligated to indemnify XTL under
this Section
9.1
without
the prior written consent of XTL, which shall not be unreasonably
withheld.
9.2. INDEMNIFICATION
BY XTL.
(a) XTL
shall
defend, indemnify and hold harmless B&C and its Affiliates, and their
respective officers, directors, agents, employees and representatives, from
and
against any and all Claims, including any attorneys’ fees and expenses of
litigation related thereto, arising from any breach of XTL’s representations and
warranties set forth in Section
7.2.
XTL’s
obligations under this Section
9.2
shall be
in addition to any other remedies B&C may have elsewhere under this
Agreement or at law or in equity with respect to such breach.
(b) XTL
shall
not settle any Claims for which it is obligated to indemnify B&C under this
Section
9.2
without
the prior written consent of B&C, which shall not be unreasonably
withheld.
12
*****
Confidential material redacted and filed separately with the
Commission.
ARTICLE
10.
GENERAL
PROVISIONS
10.1. GOVERNING
LAW.
This
Agreement shall be governed and interpreted in all respects under the laws
of
the State of California, U.S.A. applicable to contracts entered into and
wholly
to be performed within the State of California by California residents
(regardless of the choice of law principles of California or any other
jurisdiction).
10.2. LEGAL
COMPLIANCE.
The
parties shall review in good faith and cooperate in taking such actions to
ensure compliance of this Agreement with all applicable laws.
10.3. ARBITRATION. Any
dispute under this Agreement shall be finally settled by binding arbitration,
conducted in accordance with the Rules of Arbitration of the International
Chamber of Commerce. The arbitration proceedings and all pleadings and written
evidence shall be in the English language. Any written evidence originally
in a
language other than English shall be submitted in English translation
accompanied by the original or a true copy thereof. The costs of the
arbitration, including administrative and arbitrator’s fees, shall be shared
equally by the parties. Each party shall bear its own costs and attorneys’ fees
and witness’ fees. The prevailing party in any arbitration, as determined by the
arbitration panel, shall be entitled to an award against the other party
in the
amount of the prevailing party’s costs and reasonable attorneys’ fees. The
arbitration shall be held in San Francisco, California.
10.4. NOTICES.
All
notices or other communications required or permitted to be made or given
hereunder shall be deemed so made or given when hand-delivered or sent by
confirmed facsimile, or two business days after delivery to a recognized
overnight courier service, charges prepaid, and properly addressed to such
other
party as set forth below or at such other address as may be specified by
either
party hereto by written notice similarly sent or delivered.
All
notices to XTL shall be addressed as follows:
Kiryat
Weizmann, X.X. Xxx 000
Xxxxxxx,
Xxxxxx 00000
Fax:
000-0-000-0000
All
notices to B&C shall be addressed as follows:
B&C
Biopharm Co., Ltd.
IAE
Bldg., Yong-in
X.X.
Xxx
00
Xxxxxxx-xx
000-000
Xxxxx
Xxxxxxxxx:
*****
Fax:
00
00 000 0000
13
*****
Confidential material redacted and filed separately with the
Commission.
10.5. FORCE
MAJEURE.
No party
shall be liable for any delay or failure of performance to the extent such
delay
or failure is caused by circumstances beyond its reasonable control and that
by
the exercise of due diligence it is unable to prevent, provided that the
party
claiming excuse uses its best efforts to overcome the same.
10.6. ENTIRETY
OF AGREEMENT.
This
Agreement sets forth the entire agreement and understanding of the parties
relating to the subject matter contained herein and merges all prior discussions
and agreements between them, and no party shall be bound by any representation
other than as expressly stated in this Agreement or in a written amendment
to
this Agreement signed by authorized representatives of each of the
parties.
10.7. NON-WAIVER.
The
failure of a party in any one or more instances to insist upon strict
performance of any of the terms and conditions of this Agreement shall not
be
construed as a waiver or relinquishment, to any extent, of the right to assert
or rely upon any such terms or conditions on any future occasion.
10.8. DISCLAIMER
OF AGENCY.
This
Agreement shall not constitute any party the legal representative or agent
of
another, nor shall any party have the right or authority to assume, create,
or
incur any third party liability or obligation of any kind, express or implied,
against or in the name of or on behalf of another except as expressly set
forth
in this Agreement.
10.9. SEVERANCE.
If
any
provision of this Agreement is determined to be invalid or void, the remaining
provisions shall remain in effect.
10.10. ASSIGNMENT.
Except
as otherwise provided herein, neither party may assign its rights or delegate
its duties under this Agreement without the prior written consent of the
other
party, not to be unreasonably withheld; provided however, that
XTL
may assign this Agreement to any Affiliate or to any successor by merger
or sale
of substantially all of its business unit to which this Agreement relates
in a
manner such that the assignor will remain liable and responsible for the
performance and observance of all its duties and obligations hereunder. Subject
to the restrictions contained in the preceding sentence, this Agreement shall
be
binding upon the successors and assigns of the parties. Any attempted delegation
or assignment not in accordance with this Section 10.10
shall be
void and have no force or effect.
10.11. HEADINGS.
The
headings contained in this Agreement have been added for convenience only
and
shall not be construed as limiting.
10.12. COUNTERPARTS.
This
Agreement may be executed in one or more counterparts, each of which shall
be an
original and all of which shall constitute together the same
document.
14
*****
Confidential material redacted and filed separately with the
Commission.
IN
WITNESS WHEREOF, the parties hereto have duly executed this
Agreement.
|
By:
(Signature)
(Printed
Name)
(Title)
(Date)
|
B&C
BIOPHARM CO., LTD.
By: (Signature)(Printed
Name)
(Title)
(Date)
|
15
*****
Confidential material redacted and filed separately with the
Commission.
SCHEDULE
A
Countries
Included in Asia
|
*****
|
|||
Note
that
confidential treatment has been requested and one page of material has been
redacted from this Schedule A and filed separately with the
Commission.
*****
Confidential material redacted and filed separately with the
Commission.
SCHEDULE
B
B&C
Compounds
*****
Note
that
confidential treatment has been requested and one page of material has been
redacted from this Schedule B and filed separately with the
Commission.
*****
Confidential material redacted and filed separately with the
Commission.
SCHEDULE
C
Licensed
Patents
*****
Note
that
confidential treatment has been requested and one page of material has been
redacted from this Schedule C and filed separately with the
Commission.
*****
Confidential material redacted and filed separately with the
Commission.
SCHEDULE
D
Summary
of Rights under Section 2.2
|
Territory
|
Rights
to B&C
Compounds
in the Field
|
Responsibility
for Development and Commercialization
|
Financial
Terms
|
|||
|
World
excluding Asia
|
XTL
receives exclusive license to Licensed Technology
|
XTL
|
XTL
pays B&C according to Article 3
|
|||
|
Japan
|
XTL
receives exclusive license to Licensed Technology
|
XTL
|
XTL
and B&C equally share all costs and revenues
|
|||
|
Korea
|
B&C
retains all rights to B&C Compounds
|
B&C
with XTL collaboration on clinical study design
|
B&C
responsible for all costs and receives all revenues
|
|||
|
Asia
excluding Korea and Japan
|
XTL
and B&C
|
XTL
and B&C
|
XTL
and B&C equally share all costs and
revenues
|
*****
Confidential material redacted and filed separately with the
Commission.
SCHEDULE
E
B&C
Development Activities
*****
Note
that
confidential treatment has been requested and one page of material has been
redacted from this Schedule E and filed separately with the Commission.
