* CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION. REDACTED PORTIONS OF THIS EXHIBIT ARE MARKED
BY AN [_].
XENOVA LIMITED
AND
XENOVA RESEARCH LIMITED
AND
CANCER RESEARCH TECHNOLOGY LIMITED
-------------------------------------------
LICENCE AND DEVELOPMENT AGREEMENT
-------------------------------------------
Xxxxxxxx & Company
00 Xxxxxxxxxxx Xxxx
Xxxxxxxxxxxx
Xxxx XX00 0XX
xxx.xxxxxxxxxxxxxxxxxx.xxx
--------------------------
DEVELOPMENT AND LICENCE AGREEMENT
THIS AGREEMENT dated 10 January 2005 is made between:
(1) XENOVA LIMITED ("Xenova") a company incorporated in England and Wales
whose registered office is at 000 Xxxxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxx XX0
0XX; and
(2) XENOVA RESEARCH LIMITED a company incorporated in England and Wales whose
registered office is at 000 Xxxxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxx XX0 0XX;
and
(3) CANCER RESEARCH TECHNOLOGY LIMITED ("CRT") a company incorporated in
England and Wales whose registered office is at Xxxxxxxx Xxxxx, Xxxxxxxx
Xxxxxx, Xxxxxx XX0X 0XX.
RECITALS:
A. Xenova Research Limited (formerly known as Cantab Pharmaceuticals Research
Limited) and Cancer Research Campaign Technology Limited (now Cancer
Research Technology Limited) entered into a licence agreement dated 6
March 1996 (the "Prior Licence Agreement") in respect of certain L2 Patent
Rights. The Prior Licence Agreement was terminated by Xenova Research
Limited in January 2004. Under Clause 9.1.3 of the Prior Licence
Agreement, CRT is entitled to request a licence from Xenova Research
Limited in respect of certain intellectual property rights that may be
required by CRT for the commercial exploitation of the L2 Patent Rights.
Xenova Research Limited and CRT intend that the licences granted to CRT
under this Agreement shall be in satisfaction of such obligations as
Xenova Research Limited may have under Clause 9.1.3 of the Prior Licence
Agreement.
B. Xenova Research Limited has assigned the beneficial interest in all of its
right, title and interest in the Xenova Intellectual Property to Xenova,
although certain Xenova Patents remain registered with Patent Offices in
the name of Xenova Research Limited (or Cantab Pharmaceuticals Research
Limited). Accordingly, Xenova is the beneficial owner of certain Xenova
Patents, and possesses certain Xenova Know-how and Xenova Materials
relating to TA-CIN, a recombinant fusion protein vaccine comprising
L2/E6/E7 from HPV 16.
C. Xenova is willing to grant to CRT, and CRT is willing to accept, a licence
in the Field under the Xenova Patents and to use the Xenova Know-how and
Xenova Materials, all in accordance with the provisions of this Agreement.
IT IS AGREED AS FOLLOWS:
1 DEFINITIONS
In this Agreement, the following words shall have the following meanings:
AFFILIATE means in relation to a Party, any entity or person
that Controls, is Controlled by, or is under common
Control with that Party.
1
ARISING INTELLECTUAL means any and all of the Arising Patents, Arising
PROPERTY Know-how and Arising Materials.
ARISING KNOW-HOW means technical, commercial and all other information
generated by CRT or its Affiliates or Sub-licensees
during the continuation of this Agreement which is
not publicly known that relates to any of the Xenova
Intellectual Property or any Licensed Product,
including any scientific or regulatory data, product
licence applications and approvals, clinical trial
licence applications and approvals, and development
and marketing plans and activities.
ARISING MATERIALS means any and all materials that may be generated or
developed by CRT or its Affiliates or Sub-licensees
in the course of this Agreement, including any
materials based on or derived from any Xenova
Materials.
ARISING PATENTS means any and all patents and patent applications
that may be applied for or obtained in respect of
any invention(s) made by CRT, its Affiliates or
Sub-licensees during the continuation of this
Agreement and which relate to any Xenova Intellectual
Property or any Licensed Product, together with any
continuations, continuations in part, extensions,
reissues, divisions, and any patents, supplementary
protection certificates and similar rights that are
based on or derive priority from the foregoing.
COMMENCEMENT DATE means the date of execution of this Agreement by the
Parties.
COMMERCIALISATION means an agreement to be entered into between CRT
AGREEMENT and a permitted Sub-licensee (subject to the
provisions of this Agreement, including Clause 2.3)
as contemplated by Clause 5.1.
CONFIDENTIAL INFORMATION means (a) all Know-How (including Arising Know-How),
(b) information relating to the Xenova Materials
and (c) information relating to the customers,
suppliers, business partners, clients, finances,
business plans, technical developments and products
(in each case actual or prospective) of a Party
which, in each case, is not publicly known and which
is acquired by the other Party pursuant to this
Agreement.
CONTROL means direct or indirect beneficial ownership of 50%
or more of the share capital, stock or other
participating interest carrying the right to vote or
to distribution of profits of that entity or person,
as the case may be; and "Controls" and "Controlled"
shall be interpreted accordingly.
CTM means finished product lot number 0864FP of TA-CIN
manufactured by Xenova and intended for use in
clinical trials
DEVELOPMENT AND means the Development and Commercialisation Plan for
Licensed
2
COMMERCIALISATION PLAN Product summarised in the attached Schedule 4, as
amended from time to time by agreement in writing of
the Parties.
DEVELOPMENT AND means the report described in Clause 5.2 as amended
COMMERCIALISATION from time to time.
REPORT
DILIGENT AND REASONABLE means exerting such efforts and employing such
CRT EFFORTS resources as would normally be exerted or employed
by a reasonable third party company of similar size
to CRT for a product of similar market potential at
a similar stage of its product life, when utilizing
sound and reasonable scientific, business and medical
practice and judgment in order to appoint a
Sub-licensee in a timely manner who will undertake
to develop the product in a timely manner and
maximize the economic return to the Parties from
its commercialisation.
DILIGENT AND REASONABLE means exerting such efforts and employing such
SUB-LICENSEE EFFORTS resources as would normally be exerted or employed
by a reasonable third party company for a product of
similar market potential at a similar stage of its
product life, when utilizing sound and reasonable
scientific, business and medical practice and
judgment in order to develop the product in a timely
manner and maximize the economic return to the
Parties from its commercialisation.
DIRECT COSTS means:
(a) the Xenova Internal Costs;
(b) the CRT Filling Costs; and
(c) costs incurred by CRT in prosecuting,
maintaining, enforcing and defending and
commercialising the L2 Patents and the Xenova
Intellectual Property that consist of:
(i) official filing fees;
(ii) patent agent costs;
(iii) travel and out-of-pocket expenses;
(iv) courier charges and third party printing
costs;
(v) any non-recoverable taxes or charges
including value added tax which may be
imposed; and
(vi) any other similar, external costs and
expenses specifically associated with
commercialisation of the L2 patents
or/and the Xenova Intellectual Property,
excluding the costs of general partnering
conferences such as BIO.
FIELD means the prevention and treatment of HPV-related
diseases (including but not limited to vulval, anal
and cervical intraepithelial neoplasias and cervical
cancer) in humans.
3
GROSS RECEIPTS means the amount of any payment (excluding Value
Added Tax), and the value of any non-monetary
receipt, obtained by, CRT or its Affiliate, in
relation to the commercialisation or sub-licensing
(including the grant of any option over a
sub-licence) of any Xenova Intellectual Property,
including any of the following:
(a) up-front, milestone (whether at the stage of
development, marketing or otherwise), success,
bonus, maintenance and periodic (including
annual) payments, royalty and minimum royalty
payments, due under any sub-licence agreement;
(b) payments in respect of the funding of research
or development activities related to any
Licensed Product, to the extent that such
payments exceed a fair market price for such
research or development;
(c) where any sub-licence is to be granted under
cross-licensing arrangements, the value of any
third party licence obtained under such
arrangements;
(d) any premium paid over the fair market value of
shares, options or other securities in respect
of any of the share capital of CRT or its
Affiliate (such fair market value to be
determined on the assumption that Xenova
had not granted, nor agreed to grant, any
rights to CRT in respect of any Xenova
Intellectual Property);
(e) any loan, guarantee or other financial benefit
made or given other than on normal market
terms; and
(f) any shares, options or other securities
obtained from a third party.
HPV means Human Papilloma Virus
KNOW-HOW means the Xenova Know-how and the Arising Know-how.
L2 PATENTS means the patents and patent applications described
in the attached Schedule 2 and, in the case of the
patent applications, all patents arising therefrom
and all progeny applications arising from PCT
applications and patents arising therefrom and all
patent applications (and patents granted thereon)
which are related to those listed by the fact that
they are based on the same specification and/or
claim priority from the same fore-runner application
and/or as filed contain substantially the same
claims, together with any continuations,
continuations in part, extensions, reissues,
divisions, and any patents, supplementary protection
certificates and similar rights that are based on or
derive priority from the foregoing.
LICENSED PRODUCT means any product for use in the Field, that is
manufactured, sold or otherwise supplied by CRT or
its Affiliate or Sub-licensee and which (a) is
within any Valid Claim of the Xenova Patents and/or
(b) incorporates, or its development makes use of,
any of the Xenova Know-how or the Xenova Materials
(whether or not in combination with any third party
technology).
4
MANCHESTER PHASE II A Phase II study meeting the description set out in
STUDY Schedule 5.
NET RECEIPTS means Gross Receipts less Direct Costs.
PARTIES means Xenova and CRT, and "Party" shall mean either
of them.
PATENTS means any and all of the Xenova Patents and the
Arising Patents.
QUARTER means each 3 month period ending on 31 March, 30
June, 30 September and 31 December.
SUB-LICENCE has the meaning given in Clause 2.3.
SUB-LICENSEE means any person with whom CRT has entered into a
Sub-licence, subject to the provisions of Clause 2.3.
TA-CIN means a recombinant protein vaccine that has been
developed by Xenova that is a fusion protein
comprising HPV 16 L2/E6/E7 proteins.
TERRITORY means the World.
TOBACCO PARTY means any corporation, company, partnership or other
organisation or person with a material interest in
or links to the tobacco industry (other than
interests held by investment firms as part of a
portfolio of investments).
VALID CLAIM means a claim of a patent or patent application that
has not expired, been withdrawn, abandoned or
surrendered or been refused, revoked or held invalid
or unenforceable by a court or other governmental
agency of competent jurisdiction in a final and
non-appealable judgment.
XENOVA INTELLECTUAL means any and all of the Xenova Patents, Xenova
PROPERTY Know-how and Xenova Materials.
XENOVA INTERNAL COSTS means internal costs incurred or to be incurred by
Xenova in relation to the filling and lot release of
CTM for the proposed Manchester Phase II Study up to
a total aggregate sum of [_].
XENOVA KNOW-HOW means technical information which is not publicly
known (including regulatory dossiers) in the
possession of Xenova in the Field relating to (a)
TA-CIN and/or (b) the inventions claimed in the
Xenova Patents, and being further described in the
attached Schedule 3.
XENOVA MATERIALS means physical materials (including cell banks and
CTM) in the possession of Xenova in the Field
relating to (a) TA-CIN and/or (b)
5
the inventions claimed in the Xenova Patents, and
being further described in the attached Schedule 3.
XENOVA PATENTS means the patents and patent applications described
in the attached Schedule 1 and, in the case of the
patent applications, all patents arising therefrom
and all progeny applications arising from PCT
applications and patents arising therefrom and all
patent applications (and patents granted thereon)
which are related to those listed by the fact that
they are based on the same specification and/or claim
priority from the same fore-runner application
and/or as filed contain substantially the same
claims, together with any continuations,
continuations in part, extensions, reissues,
divisions, and any patents, supplementary protection
certificates and similar rights that are based on or
derive priority from the foregoing.
2. GRANT OF RIGHTS
2.1 Licences to Xenova Intellectual Property. Xenova hereby grants to CRT,
subject to the provisions of this Agreement:
(a) an exclusive licence in the Field under the Xenova Patents, with the right
to sub- license, subject to clause 2.3 below, to develop, manufacture,
have manufactured, use and sell Licensed Product in the Field in the
Territory; and
(b) an exclusive licence in the Field to use the Xenova Know-how and the
Xenova Materials, with the right to sub-license, subject to clause 2.3
below, to develop, manufacture, have manufactured, use and sell Licensed
Product in the Field in the Territory.
2.2 Formal licences. If requested by CRT, and at CRT's administrative cost,
the Parties shall execute such formal licences as may be necessary or
appropriate for registration with Patent Offices and other relevant
authorities in particular jurisdictions. In the event of any conflict in
meaning between any such licence and the provisions of this Agreement, the
provisions of this Agreement shall prevail. The Parties shall use
reasonable endeavours to ensure that, to the extent permitted by relevant
authorities, this Agreement shall not form part of any public record. To
the extent that Xenova Research Limited retains any right, title or
interest in the Xenova Patents it joins with Xenova in granting the rights
referred to in Clause 2.1 and undertakes to execute the formal licences
referred to in this Clause 2.2.
2.3 Sub-licensing. CRT shall be entitled to grant sub-licences (which for the
purposes of this clause shall include any option or right to acquire a
sub-licence) of its rights under this Agreement to any person (including
without limitation any Affiliate of CRT) ("Sub- licences), provided that:
(a) CRT shall (i) obtain Xenova's prior written consent (such consent
not to be unreasonably withheld or delayed) to the execution of a
term sheet, letter of intent or
6
similar document ("Term Sheet") with the Sub-licensee, (ii) keep
Xenova regularly informed of the progress of negotiations with each
sub-licensee who has agreed a Term Sheet with CRT, and (iii) if it
is proposed that the sub-licence agreement shall survive termination
of this Agreement, obtain Xenova's prior written consent to the
terms of the sub-licence agreement and to CRT's execution of the
sub-licence agreement;
(b) the Sub-licence shall include obligations on the Sub-licensee which
are equivalent to the obligations on CRT under Clauses 3, 5.2, 6.6,
9.3 and 10 of this Agreement, as well as obligations on the
sub-licensee to use at least Diligent and Reasonable Sublicensee
Efforts to develop and commercialise Licensed Products, and CRT
shall ensure that the Sub-licence agreement provides that Xenova
may, in its own right, enforce all such obligations against the
Sub-licensee;
(c) the Sub-licence shall include obligations on the Sub-licensee that
all Licensed Products marketed by it are of satisfactory quality and
comply with all applicable laws and regulations in each part of the
Territory relevant to such Sub-licence.
(d) the Sub-licence shall terminate automatically on the termination of
this Agreement for any reason (unless Xenova has given consent under
clause 2.3(a)(iii)); and
(e) within 30 days of the grant of any Sub-licence CRT shall provide to
Xenova a true copy of it.
2.4 Reservation of rights. For the avoidance of doubt, Xenova reserves the
right to use Xenova Intellectual Property in the Field for the purposes of
its own internal research only. It is understood and agreed that Xenova
will be required under regulatory GCP to retain archive samples of Xenova
Materials.
2.5 No other licence. It is acknowledged and agreed that except for the
licence(s) expressly granted by the provisions of this clause 2, Xenova
reserves all its rights. Without prejudice to the generality of the
foregoing Xenova reserves all rights under the Xenova Intellectual
Property outside the Field.
3 KNOW-HOW AND CONFIDENTIAL INFORMATION
3.1 Provision of Know-how. Within 30 days of the Commencement Date, Xenova
shall supply CRT or its Sub-licensee (if any) with the Xenova Know-how. In
addition, Xenova shall supply, in confidence, information in respect of
the Xenova Intellectual Property, as available and to the extent Xenova is
free to disclose it, to Sub-licensees or potential Sub-licensees of CRT as
CRT shall reasonably request and as is required by such Sub-licensees or
potential sub-licensees to decide whether to enter into or terminate any
Sub-licence. The Xenova Know-how shall be subject to the confidentiality
provisions of Clause 3.4. The method of such supply shall be as specified
in the Schedule 3, but shall not require Xenova to undertake more than 5
man-days work in respect of the obligation under this Clause 3.1 to
provide the Xenova Know-How to the University of Manchester and potential
Sub-licensees and more than 5 man-days work in respect of the obligation
under this Clause 3.1 to provide the Xenova Know-How to actual
Sub-licensees (ie a total
7
maximum of 10 man-days) free of charge, unless otherwise agreed in writing
between the Parties
3.2 Status of Know-how and Materials. CRT acknowledges that the Xenova
Know-how and Xenova Materials are at an early stage of development.
Accordingly, specific results cannot be guaranteed and any results,
materials, information or other items, including the Xenova Know-how and
Xenova Materials and inventions claimed in the Xenova Patents provided
under this Agreement are provided "as is" and without any express or
implied warranties, representations or undertakings. As examples, but
without limiting the foregoing, Xenova does not give any warranty that
Xenova Materials are of merchantable or satisfactory quality, are fit for
any particular purpose, comply with any sample or description, or are
viable, uncontaminated, safe or non-toxic.
3.3 Use of Know-how. CRT undertakes that for a period of 10 years from the
date of first commercial sale of Licensed Product in the Territory or for
so long as any substantial part of the Xenova Know-how remains subject to
the obligations of confidence of Clause 3.4, whichever is the shorter, it
will not use the Xenova Know-how for any purpose except as expressly
licensed hereby and in accordance with the provisions of this Agreement,
including, but not limited to clause 8 hereof.
3.4 Confidentiality obligations. Each Party ("Receiving Party") undertakes:
(a) save as permitted by this Agreement to maintain as secret and
confidential Confidential Information obtained directly or
indirectly from the other Party ("Disclosing Party") in the course
of or in anticipation of this Agreement and to respect the
Disclosing Party's rights therein,
(b) to use the same exclusively for the purposes of this Agreement, and
(c) to disclose the same only to those of its employees, contractors,
customers, potential customers, potential Sub-licensees and
Sub-licensees pursuant to this Agreement (if any) to whom and to the
extent that such disclosure is reasonably necessary for the purposes
of this Agreement.
3.5 Exceptions to obligations. The provisions of Clause 3.4 shall not apply to
Confidential Information which the Receiving Party can demonstrate by
reasonable, written evidence:
(a) was, prior to its receipt by the Receiving Party from the Disclosing
Party, in the possession of the Receiving Party and at its free
disposal;
(b) is subsequently disclosed to the Receiving Party without any
obligations of confidence by a third party who has not derived it
directly or indirectly from the Disclosing Party;
(c) is or becomes generally available to the public through no act or
default of the Receiving Party or its agents, employees, Affiliates
or sub-licencees; or
(d) in the case of Know-how, it has independently developed
8
3.6 Disclosure to court, etc. If the Receiving Party is required to disclose
Confidential Information to the courts of any competent jurisdiction, or
to any government regulatory agency or financial authority, such
disclosure shall not be a breach of this clause 3, provided that the
Receiving Party shall (i) inform the Disclosing Party as soon as is
reasonably practicable, and (ii) at the Disclosing Party's request seek to
persuade the court, agency or authority to have the information treated in
a confidential manner, where this is possible under the court, agency or
authority's procedures.
3.7 Disclosure to employees. The Receiving Party shall procure that all of its
employees, contractors, consultants, advisers, customers, potential
customers, potential sub-licensees and sub-licensees pursuant to this
Agreement (if any) who have access to any of the Disclosing Party's
Confidential Information to which Clause 3.4 applies, shall be made aware
of and subject to these obligations and shall have entered into written
undertakings of confidentiality at least as restrictive as Clauses 3.4 and
which apply to the Disclosing Party's information.
4 MATERIALS
4.1 Supply of materials. Xenova shall supply the Xenova Materials or any of
them, including CTM, to CRT (or CRT's nominee) in such quantities as CRT
may reasonably request, within 30 days of such request. All such CTM
supplied by Xenova under or in connection with this Agreement shall remain
the absolute property of Xenova. For the avoidance of doubt, where Xenova
Materials other than CTM to be supplied to University of Manchester are to
be or are supplied to a nominee of CRT under this clause 4.1, such nominee
need not enter into an agreement directly with Xenova to effect such
transfer, but may be sub-licensed solely by CRT under the licence granted
to CRT pursuant to clause 2.1(b) hereof. Any CTM supplied to Manchester
shall be supplied on terms to be agreed between University of Manchester
and Xenova. Xenova shall supply CRT with a copy of such terms for approval
prior to signature.
5 DEVELOPMENT
5.1 Diligence. CRT shall use Diligent and Reasonable CRT Efforts (a) to secure
third party Sub-licensee(s) (subject to Clause 2.3) who have the
capability and resources to develop and commercially exploit Licensed
Products throughout the Territory; and (b) to commercialise TA-CIN in
accordance with the Development and Commercialisation Plan attached at
Schedule 4. Without prejudice to the generality of the foregoing
obligations, CRT shall use Diligent and Reasonable CRT Efforts to
facilitate the grant of a licence or Sub-licence of the Xenova
Intellectual Property to the University of Manchester to enable the
University of Manchester to conduct the Manchester Phase II Study in
accordance with the plan set out in Schedule 5 hereto.
5.2 Reporting. Without prejudice to the generality of CRT's obligations under
clause 5.1, CRT shall:
(a) provide the Development and Commercialisation Report at least every
6 months to Xenova, showing all past, current and projected
activities taken or to be taken
9
by CRT in respect of its obligations pursuant to clause 5.1. CRT
shall use Diligent and Reasonable CRT Efforts to procure that its
Sub-licensees produce an equivalent report at least every 6 months
detailing their efforts and proposals to bring Licensed Product to
market and maximise the sale of Licensed Product worldwide. Xenova's
receipt or approval of any such report shall not be taken to waive
or qualify CRT's obligations under Clause 5.1.
(b) within 30 days of the due date of each such report, and otherwise
from time to time (but not more frequently than once per month) at
either Party's request, hold a conference call or face-to-face
meeting with the other Party to discuss the contents of the
Development and Commercialisation Report.
5.3 Referral to expert. If Xenova considers at any time during the period of
this Agreement that CRT has without legitimate reason failed to comply
with its obligations under Clause 5.1, Xenova shall give written notice of
such opinion to CRT. If, on the expiry of 90 days from such written
notice, Xenova considers that CRT is continuing not to comply Xenova shall
be entitled to ask an independent expert(s) (the "Independent Expert") to
consider whether CRT has complied with its obligations under Clause 5.1.
5.4 Appointment of expert. If required pursuant to clause 5.3, the Independent
Expert shall be appointed in accordance with the provisions of Schedule 6
and his decision shall be final and binding on the Parties.
5.5 Decision by expert. If the Independent Expert determines that CRT has
failed to comply with its obligations under Clause 5.1, Xenova shall be
entitled, with not less than 3 months' written notice to terminate this
Agreement and the licences granted to CRT under Clause 2. This right of
termination, and the exercise of such right, shall not prejudice any other
right or remedy that Xenova may have for breach of Clause 2.
5.6 Development costs.
5.6.1 As between Xenova and CRT, CRT or its Sub-licensee(s) shall bear all
future costs associated with the development and commercialisation
of Licensed Product. The Parties recognise that Xenova has incurred
and will be incurring The Xenova Internal Costs. CRT will pay
Xenova's external costs associated with the filling, lot release and
ongoing stability testing of the CTM required for the clinical trial
to be undertaken by Manchester University, up to a maximum of
[_] in 2004/5 in accordance with clause 6.1 (the "CRT
Filling Cost"). It is anticipated that the invoice(s) for such costs
will be issued by Xenova in March 2005. Direct Costs incurred by
either Party will be reimbursed as a first charge against Gross
Receipts in accordance with Clause 6.2.
5.6.2 If requested by any Sub-licensee or potential Sub-licensee of CRT,
Xenova may contract directly with such person to conduct work
including training and technical support as part of its plans for
developing and selling Licensed Products on terms to be negotiated
between Xenova and such person.
10
6 PAYMENTS
6.1 CRT shall reimburse Xenova certain of its development costs in accordance
with clause 5.6 and its patent prosecution costs in accordance with clause
7.1 in each case within 30 days of receipt of an invoice from Xenova in
respect of such costs.
6.2 Royalties. CRT shall pay to Xenova [_] of CRT's Net Receipts. CRT shall
reimburse each Party's Direct Costs out of Gross Receipts, pro-rata
according to the amount of Direct Costs that each Party has incurred and
have not previously been reimbursed.
6.3 Payment dates. CRT shall furnish a statement together with payment of all
sums due to Xenova under clause 6.2 within 30 days of the end of each
Quarter including, in respect of each territory or region in which
Licensed Product is sold or Gross Receipts obtained, the amount of sales
income, and Gross Receipts (together, "Income") obtained (and, where and
to the extent available, the quantity, description and value of each
Licensed Product sold, on a country-by-country basis) and the amount and
type of Direct Costs deducted expressed both in the local currency in
which the Income was received and pounds sterling (if different) and
showing the conversion rates used. Xenova shall then send an invoice to
CRT in respect of the sums due pursuant to this clause 6.3.
Notwithstanding the foregoing, during the period prior to first commercial
sale of any Licensed Product, there shall be no obligation on CRT to
provide such a statement where no Income has been received during the
previous Quarter. Following first commercial sale of a Licensed Product,
if no Income has been received during any Quarter, CRT shall provide a
statement in accordance with the first sentence of this Clause 6.3,
stating that no Income has been received.
6.4 Payment terms. All sums due under this Agreement:
(a) are exclusive of Value Added Tax which where applicable will be paid
by CRT to Xenova in addition;
(b) shall be paid in pounds sterling and, in the case of Income received
by CRT in a currency other than pounds sterling, the Income shall be
calculated in the other currency and then converted into equivalent
pounds sterling at the conversion rate charged by CRT's bankers for
the conversion of such other currency into pounds sterling as quoted
by the Financial Times on the last business day of the quarterly
period with respect to which the payment is made;
(c) shall be made without deduction of income tax or other taxes charges
or duties that may be imposed, except insofar as CRT is required to
deduct the same to comply with applicable laws. The Parties shall
cooperate and take all steps reasonably and lawfully available to
them to avoid deducting such taxes and to obtain double taxation
relief. If CRT is required to make any such deduction it shall
provide Xenova with such certificates or other documents as it can
reasonably obtain to enable Xenova to obtain appropriate relief from
double taxation of the payment in question; and
(d) shall be made on or by the due date, failing which Xenova may charge
interest on
11
any outstanding amount on a daily basis at a rate equivalent to the
annual rate of 3% above the Barclays Bank plc base lending rate then
in force.
6.5 Exchange controls, etc. If at any time during the continuation of this
Agreement CRT is prohibited from making any of the payments required
hereunder by a governmental authority in any country then CRT will within
the period prescribed in this agreement for making the said payments use
its best endeavours to secure from the proper authority in the relevant
country permission to make the said payments and will make them within 7
days of receiving such permission. If such permission is not received
within 30 (thirty) days of CRT making a request for such permission then,
at the option of Xenova, CRT shall deposit the royalty payments due in the
currency of the relevant country either in a bank account designated by
Xenova within such country or such royalty payments shall be made to an
associated company of Xenova designated by Xenova and having offices in
the relevant country designated by Xenova.
6.6 Records
6.6.1 For a period of 5 years after each payment is made, CRT shall keep,
accessible at its normal place of business detailed and up to date
records and accounts containing all data necessary for the
calculation of Gross Receipts and Net Receipts and the sums due and
payable hereunder.
6.6.2 CRT shall make such records and accounts available, on reasonable
notice, for inspection during business hours by an independent
chartered accountant nominated by Xenova for the purpose of
verifying the accuracy of any statement or report given by CRT to
Xenova under clause 6.3. The accountant shall be required to keep
confidential all information learnt during any such inspection, and
to disclose to Xenova only such details as may be necessary to
report on the accuracy of CRT's statement or report. Xenova shall be
responsible for the accountant's charges unless the accountant
certifies that there has been an underpayment of more than 5% (five
percent) in any payment, in which case CRT shall pay his charges in
respect of that inspection.
6.6.3 CRT shall ensure that Xenova has similar rights to inspect records
and accounts in respect of any Sub-licensee of CRT that is granted a
Sub-licence under Xenova Intellectual Property pursuant to this
Agreement as those set out in this Clause 6.6.
7. INTELLECTUAL PROPERTY
7.1 Obtain and maintain the Xenova Patents. Xenova shall, at the cost and
expense of CRT and in consultation with CRT, taking into consideration any
representations or recommendations made by CRT:
(a) diligently seek to obtain valid patents in the name of Xenova
pursuant to each of the patent applications listed in Schedule 1;
and
(b) pay all renewal fees in respect of the Xenova Patents as and when
due;
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provided that if CRT wishes to abandon any such application or not
to maintain any such Xenova Patent (or to cease funding such
application or Xenova Patent) it shall give 1 (one) month's prior
written notice to Xenova and on the expiry of such notice period CRT
shall cease to be licensed under the patent application or patent
identified in the notice.
7.2 Xenova shall keep the CRT informed as to the prosecution status of the
Xenova Patents. Xenova shall copy CRT into correspondence regarding the
Xenova Patents sent to its patent agents and Xenova shall instruct its
patent agent to copy CRT into correspondence sent by the patent agent in
which case Xenova shall be deemed to have complied with this Clause 7.2.
7.3 Infringement of the Patents
7.3.1 Each Party shall inform the other Party promptly if it becomes aware
of any infringement or potential infringement of any of the Patents
in the Field, and the Parties shall consult with each other to
decide the best way to respond to such infringement.
7.3.2 If the Parties fail to agree on a joint programme of action,
including how the costs of any such action are to be borne and how
any damages or other sums received from such action are to be
distributed, then either CRT or Xenova shall be entitled to take
action against the third party and either CRT or Xenova shall be
entitled to request the other join in such proceedings at the
requesting party's sole expense and CRT shall be entitled to all
damages or other sums received from such action, after reimbursing
Xenova for any reasonable expenses incurred in assisting it in such
action, and subject to paying Xenova revenue share based on the
amount of such damages or sums as if it were a Gross Receipt, in
accordance with clause 6.2. For the purposes of calculating Net
Receipt in such case, CRT shall be entitled to deduct any expense
incurred by it as a result of Xenova taking such action to the
extent such expenses have not been recovered from the other litigant
in the action. If the alleged infringement is both within and
outside the Field, the Parties shall also co-operate with Xenova's
other licensees (if any) in relation to any such action and shall
divide the costs of such action among CRT and Xenova's other
licensees who participate in such action on a basis to be agreed.
7.4 Infringement of third party rights
7.4.1 If any warning letter or other notice of infringement is received by
a Party, or legal suit or other action is brought against a Party,
alleging infringement of third party rights in the manufacture, use
or sale of any Licensed Product or use of any Xenova Patents, that
Party shall promptly provide full details to the other Party, and
the Parties shall discuss the best way to respond.
7.4.2 Xenova shall have the right but not the obligation to defend such
suit and shall have the right to settle with such third party,
provided that if any action or proposed settlement involves the
making of any statement, express or implied, concerning the validity
of any Patent, the consent of CRT must be obtained before taking
such action or making such settlement, such consent not to be
unreasonably withheld or delayed.
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7.5 Third party intellectual property. For the avoidance of doubt as between
Xenova and CRT, CRT shall be solely responsible for obtaining and paying
for any additional licences and other rights that may be required to
enable CRT, its Affiliates or Sub-licensees to commercialise Licensed
Product in the Territory.
8 PUBLICATIONS
8.1 CRT shall, and shall procure that its Sub-licensees shall undertake to,
and shall use reasonable endeavours to procure that its Sub-licensees
shall, send any proposals for publication of scientific papers containing,
or other dissemination of, Xenova Know-How or other Confidential
Information belonging to Xenova to the Commercial Director of Xenova, for
review 30 days prior to submission for publication or other dissemination.
8.2 Xenova shall have the right to remove Xenova Know-How or other
Confidential Information belonging to Xenova from such publication or
dissemination within 30 days of receipt of the proposed publication or
other dissemination, and/or to require that the publication or other
dissemination be delayed for up to 60 days to allow patent applications to
be filed.
8.3 In the event that Xenova does not propose an amended
publication/dissemination or require the publication to be delayed
pursuant to clause 8.2 with 30 days of receipt, CRT or its Sub-licensee as
the case may be shall be entitled to submit the publication or make the
dissemination 30 days after its receipt by Xenova in accordance with
clause 8.1.
8.4 Notwithstanding clause 8.1, 8.2 and 8.3 and the confidentiality
obligations assumed by the Parties hereunder, the Parties acknowledge the
importance of publications to academic standing. In the light of this, the
Parties shall use all reasonable efforts to facilitate early publication
of any results relating to research involving the Xenova Intellectual
Property
9 WARRANTIES AND LIABILITY
9.1 Warranties by Xenova. Xenova and Xenova Research Limited warrant as
follows:
(a) Xenova Research Limited warrants that it is the registered
proprietor of the Xenova Patents;
(b) Xenova warrants that it is the beneficial owner of the Xenova
Patents; and
(c) Each of Xenova and Xenova Research Limited warrants that it has not
done, and will not do nor agree to do during the continuation of
this Agreement, any of the following things if to do so would be
inconsistent with the exercise by CRT of the rights granted to it
under this Agreement, namely:
(i) grant or agree to grant any rights, including licences, in the
Xenova Intellectual Property or any part of it in the Field;
or
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(ii) assign, mortgage, charge or otherwise transfer any of the
Xenova Patents in the Field; and
(d) each of Xenova and Xenova Research Limited warrants that it is not
aware (but without having carried out any searches or
investigations) that any third party owns or claims any rights in
the Xenova Patents.
9.2 No other warranties
9.2.1 Each of CRT and Xenova and Xenova Research Limited acknowledges
that, in entering into this Agreement, it does not do so in reliance
on any representation, warranty or other provision except as
expressly provided in this Agreement, and any conditions, warranties
or other terms implied by statute or common law are excluded from
this Agreement to the fullest extent permitted by law.
9.2.2 Without limiting the scope of Clause 9.2.1, neither Xenova nor
Xenova Research Limited gives any warranty, representation or
undertaking: -
(a) as to the efficacy or usefulness of any of the Xenova
Intellectual Property; or
(b) that any of the Xenova Patents is or will be valid or
subsisting or (in the case of an application) will proceed to
grant; or
(c) that the use of any of the Xenova Intellectual Property, the
manufacture, sale or use of the Licensed Product or the
exercise of any of the rights granted under this Agreement
will not infringe any other intellectual property or other
rights of any other person; or
(d) that the Xenova Know-how or the Xenova Materials or any other
information or materials communicated or provided by Xenova or
Xenova Research Limited to CRT under or in connection with
this Agreement will produce Licensed Product of satisfactory
quality or fit for the purpose for which CRT intended; or
(e) as imposing any obligation on Xenova or Xenova Research
Limited to bring or prosecute actions or proceedings against
third parties for infringement or to defend any action or
proceedings for revocation of any of the Xenova Patents; or
(f) as imposing any liability on Xenova or Xenova Research Limited
in the event that any third party supplies Licensed Product to
customers located in the Territory.
9.3 Indemnity and insurance. In the case of activities conducted under this
Agreement by CRT or its Affiliates, CRT shall, and in the case of all
other activities CRT shall procure that its Sub-licensees or
sub-contractors, as applicable, shall undertake to, indemnify and hold
harmless Xenova and its Affiliates and their respective officers,
employees, consultants, agents and representatives (the "Indemnitees")
against all third party Claims which may be asserted against or suffered
by any of the Indemnitees and which relate to:
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(a) the use of any inventions claimed in the Xenova Patents, or the use
of any Xenova Know-how, Xenova Materials or other items supplied by
or on behalf of Xenova under or in anticipation of this Agreement
("Supplied Items"), or
(b) the manufacture, distribution, sale, supply or use of any Licensed
Product or any other products or services which incorporate any
Supplied Items,
by or on behalf of CRT, its Affiliates or Sub-licensees, or subsequently
by any third party, including without limitation claims based on product
liability laws. For the purpose of this clause, "Claims" shall mean all
demands, claims and liability (whether criminal or civil, in contract,
tort or otherwise) for losses, damages, legal costs and other expenses of
any nature whatsoever and all costs and expenses (including without
limitation legal costs) incurred in connection therewith. CRT shall ensure
that it does not grant any right to any person, nor enter into an
agreement with any person, under which such person will conduct any
clinical trial with respect to Licensed Products unless such person has
obtained clinical trials insurance on terms at least as protective of
patients' interests as the terms recommended by the ABPI in respect of
such trial.
9.4 Liability. Subject to clause 9.3, but notwithstanding any other provision
of this Agreement, no Party shall be liable to any other Party to this
Agreement in contract, tort, negligence, breach of statutory duty or
otherwise for any loss, damage, costs or expenses of any nature whatsoever
incurred or suffered by that other party or its Affiliates of an indirect
or consequential nature including without limitation any economic loss or
other loss of turnover, profits, business or goodwill.
9.5 Xenova Materials. Without prejudice to the provisions of clauses 9.1 to
9.4, for as long as Xenova retains possession of any Xenova Materials that
are to be provided to CRT under this Agreement, CRT agrees that Xenova
shall have no liability for any loss or damage that may occur to such
Xenova Materials, except where such loss or damage is caused by Xenova's
negligence.
10. DURATION AND TERMINATION
10.1 Commencement and Termination by Expiry. This Agreement, and the licences
granted hereunder, shall come into effect on the Commencement Date and,
unless terminated earlier in accordance with this Clause 10, shall
continue in force on a country by country basis until the later of:
(a) The date on which the last of the Xenova Patents have expired or
been revoked without a right of further appeal, and
(b) The tenth anniversary of the first commercial sale of Licensed
Product in that country;
and on such date this Agreement and the licences granted hereunder shall
terminate automatically by expiry.
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10.2 Early termination
10.2.1 CRT may terminate this Agreement at any time on [_] notice in
writing to Xenova.
10.2.2 Without prejudice to any other right or remedy, either Party may
terminate this Agreement at any time by notice in writing to the
other Party ("Other Party"), such notice to take effect as
specified in the notice:
(a) if the Other Party is in material breach of this Agreement (which in
the case of CRT includes any Sub-licensee of CRT being material
breach of those terms of its Sub-licence which are enforceable by
Xenova pursuant to clause 2.3 (b) hereof, but only if, at the time
this clause is invoked, the L2 Patents have expired or been
revoked)and, in the case of a breach capable of remedy within [_],
the breach is not remedied within [_] of the Other Party receiving
notice specifying the breach and requiring its remedy; or
(b) if the Other Party (which in the case of CRT includes any
Sub-licensee of CRT, but only if, at the time this clause is
invoked, the L2 Patents have expired or been revoked) becomes
insolvent, or if an order is made or a resolution is passed for the
winding up of the Other Party (other than voluntarily for the
purpose of solvent amalgamation or reconstruction), or if an
administrator, administrative receiver or receiver is appointed in
respect of the whole or any part of the Other Party's assets or
business, or if the Other Party makes any composition with its
creditors or takes or suffers any similar or analogous action in
consequence of debt.
10.2.3 Xenova may forthwith terminate this Agreement by giving written
notice to CRT if:
(a) CRT or its Affiliate or Sub-licensee commences legal
proceedings, or assists any third party to commence legal
proceedings, to challenge the validity of any of the Xenova
Patents; or
(b) There is any change in the Control of CRT or Cancer Research
UK; or
(c) CRT fails to enter into a Commercialisation Agreement by 31
December 2007.
10.2.4 Xenova may terminate this Agreement in accordance with clause 5.5
10.3 Consequences of termination
10.3.1 Upon termination of this Agreement for any reason otherwise than in
accordance with Clause 10.1:
(a) If termination occurs after the first commercial sale of
Licensed Product, CRT and its Sub-licensees shall be entitled
to sell, use or otherwise dispose
17
of (subject to payment of royalties under clause 6.2) any
unsold or unused stocks of the Licensed Product for a period
of 6 months following the date of termination; and if
termination occurs prior to the first commercial sale of
Licensed Product, CRT shall forthwith return and provide to
Xenova, free of charge, all Xenova Materials and Xenova
Know-how and all clinical and other data and reports relating
to the development of Licensed Product(s);
(b) subject to paragraph (a) above, CRT and its Sub-licensees
shall no longer be licensed to use or otherwise exploit in any
way, either directly or indirectly, any of the Xenova
Intellectual Property;
(c) subject to paragraph (a) above, CRT and its Sub-licensees
shall consent to the cancellation of any formal licence
granted to it, or of any registration of it in any register,
in relation to any of the Xenova Patents;
(d) to the extent possible, CRT shall seek to have any product
licences, pricing approvals and other permits and applications
transferred into the name of Xenova or its nominee, but this
paragraph (d) shall not apply in the event of termination of
this Agreement by CRT under Clause 10.2.2;
(e) the provisions of clauses 1, 3.2, 3.3, 3.4, 3.5, 3.6, 3.7,6.6,
8, 9,10.3, 11.7, 11.8 and 11.9 and 11.13 shall continue in
force; and
(f) save as provided in this Clause 10, and except in respect of
any accrued rights, neither party shall be under any further
obligation to the other.
(g) CRT shall grant Xenova a licence to the L2 Patents and, to the
extent CRT is free to licence such rights, CRT shall grant
Xenova a licence to the Arising Intellectual Property on
commercially reasonable terms to be agreed, and for a period
of 90 days following such termination CRT shall not grant such
rights to any other person. If CRT and Xenova cannot agree
such terms within such 90 day period, either Party may refer
the terms to be settled by an independent expert in accordance
with the provisions of Schedule 6, in which case CRT shall, at
Xenova's request, grant such rights on the terms settled by
the expert. However, this paragraph (g) shall not apply in the
event of termination of this Agreement by CRT under Clause
10.2.2
10.3.2 Upon termination of this Agreement for any reason otherwise than in
accordance with Clause 10.1 or 10.2.1 or 10.2.3(a) and provided that
Xenova has not terminated under Clause 10.2.2 as a result of breach,
insolvency or other default of the Sub-licensee, Xenova shall enter
into a direct licence with any Sub-licensee whose Sub-licence has
terminated as a result of the termination of this Agreement on
materially identical terms to that Sub-licensee's Sub-licence with
CRT, provided that Xenova approved those terms in writing under
Clause 2.3(a)(iii).
11 GENERAL
11.1 Force majeure. Neither Party shall have any liability or be deemed to be
in breach of this
18
Agreement for any delays or failures in performance of this Agreement
which result from circumstances beyond the reasonable control of that
Party, including without limitation labour disputes involving that Party.
The Party affected by such circumstances shall promptly notify the other
Party in writing when such circumstances cause a delay or failure in
performance and when they cease to do so.
11.2 Amendment. This Agreement may only be amended in writing signed by duly
authorised representatives of Xenova and CRT.
11.3 Assignment and third party rights.
11.3.1 Subject to clause 11.3.2 below, neither Party shall assign,
mortgage, charge or otherwise transfer any rights or obligations
under this Agreement, nor any of the Xenova Patents or rights under
the Xenova Patents, without the prior written consent of the other
Party.
11.3.2 Either Party may assign all its rights and obligations under this
Agreement together with its rights in the Xenova Patent to any
company to which it transfers all or substantially all of its assets
or business in the Field, provided that the assignee undertakes to
the other Party to be bound by and perform the obligations of the
assignor under this Agreement and provided, in the case of
assignment by Xenova, such assignee is not a Tobacco Party.
11.4 Waiver. No failure or delay on the part of either Party to exercise any
right or remedy under this Agreement shall be construed or operate as a
waiver thereof, nor shall any single or partial exercise of any right or
remedy preclude the further exercise of such right or remedy.
11.5 Invalid clauses. If any provision or part of this Agreement is held to be
invalid in any jurisdiction, amendments to this Agreement in respect of
its application to that jurisdiction may be made by the addition or
deletion of wording as appropriate to remove the invalid part or provision
but other wise retain the provision and the other provisions of this
Agreement to the maximum extent permissible under that jurisdiction's
applicable law.
11.6 No Agency. Neither Party shall act or describe itself as the agent of the
other, nor shall it make or represent that it has authority to make any
commitments on the other's behalf.
11.7 Interpretation. In this Agreement:
(a) the headings are used for convenience only and shall not affect its
interpretation;
(b) references to persons shall include incorporated and unincorporated
persons; references to the singular include the plural and vice
versa; and references to the masculine include the feminine;
(c) references to Clauses and Schedules mean clauses of, and schedules
to, this Agreement;
(d) references to Xenova or CRT shall include their permitted successors
and permitted assignees;
19
(e) where the word "including" is used, it shall be understood as
meaning "including without limitation"; and
(f) references to the grant of "exclusive" rights shall mean that the
person granting the rights shall neither grant the same rights (in
the same Field and Territory) to any other person, nor exercise
those rights directly to the extent that and for as long as the
Licensed Product are within Valid Claims of unexpired Xenova Patents
or, to the extent that the Licensed Product is protected by Know-how
that has not become known to the public, for a period of 10 years
from the first commercial sale of Licensed Product in that part of
the Territory.
11.8 Notices
11.8.1 Any notice to be given under this Agreement shall be in writing and
shall be sent by first class mail or air mail, or by fax (confirmed
by first class mail or air mail) to the address of the relevant
Party set out at the head of this Agreement, or to the relevant fax
number set out below, or such other address or fax number as that
Party may from time to time notify to the other Party in accordance
with this Clause 11.8. The fax numbers of the Parties are as
follows:
Xenova-01753 706 615
CRT-0207 269 3641.
11.8.2 Notices sent as above shall be deemed to have been received three
working days after the day of posting (in the case of inland first
class mail), or seven working days after the date of posting (in the
case of air mail), or on the next working day after transmission (in
the case of fax messages, but only if a transmission report is
generated by the sender's fax machine recording a message from the
recipient's fax machine, confirming that the fax was sent to the
number indicated above and confirming that all pages were
successfully transmitted).
11.9 Law and Jurisdiction. The validity, construction and performance of this
Agreement shall be governed by English law and shall be subject to the
exclusive jurisdiction of the English courts to which the parties hereby
submit, except that a Party may seek an interim injunction in any court of
competent jurisdiction.
11.10 Further action. Each Party agrees to execute, acknowledge and deliver such
further instruments, and do all further similar acts, as may be necessary
or appropriate to carry out the purposes and intent of this Agreement.
11.11 Announcements. Neither Party shall make any press or other public
announcement concerning any aspect of this Agreement, or make any use of
the name of the other Party in connection with or in consequence of this
Agreement, without the prior written consent of the other Party, except as
may be required by law or by the rules of any stock exchange on which
either Party is listed. The Parties shall agree a form of press release
for issue on signature of this Agreement.
11.12 Entire agreement. This Agreement, including its Schedules, sets out the
entire agreement
20
between the Parties relating to its subject matter and supersedes all
prior oral or written agreements, arrangements or understandings between
them relating to such subject matter. The Parties acknowledge that they
are not relying on any representation, agreement, term or condition that
is not set out in this Agreement. Nothing in this Agreement excludes
liability for fraud.
11.13 Third party rights. Each of the persons identified in Clause 9.3 may in
his own right enforce the provisions of those respective Clauses. Except
as provided in the previous sentence of this Clause 11.13, this Agreement
is not made for the benefit of, nor shall any of its provisions be
enforceable by, any person other than the parties to this Agreement and
their respective successors and permitted assignees. The Parties may agree
to terminate, amend, extend or otherwise vary the provisions of this
Agreement without the consent of any third party.
AGREED by the Parties through their authorised signatories:
For and on behalf of For and on behalf of
XENOVA LIMITED CANCER RESEARCH TECHNOLOGY LIMITED
/s/ Xxxxx X. Oxlade /s/ K S Xxxxxx
__________________________________ __________________________________
Xxxxx X. Oxlade K S Xxxxxx
CEO COO
10 January 2005 7 January 2005
For and on behalf of
XENOVA RESEARCH LIMITED
/s/ Xxxxxx Xxxxxx
__________________________________
Xxxxxx Xxxxxx
Finance Director
10 January 2005
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