EXCLUSIVE LICENSE AGREEMENT
THIS
EXCLUSIVE LICENSE AGREEMENT
(“Agreement”) is made effective the first day of July, 2004 (“Effective Date”)
by and between The Cleveland Clinic Foundation, a non-profit Ohio corporation
(“CCF”), and Cleveland BioLabs, Inc., a corporation organized and existing under
the laws of the State of Ohio (“CBL”).
WHEREAS,
CCF
owns the Licensed Patents and CCF Technology which were developed at CCF prior
to the Effective Date of this Agreement and, in addition may be further
developed at CCF under the direction of Xx. Xxxxxx Xxxxxx, an employee of CCF
(“Doctor”),
WHEREAS,
CCF
desires to have the Licensed Rights developed and used for the benefit of CBL,
CCF and the public pursuant to the Development Plan and the Research and
Development Milestones, and
WHEREAS,
CBL
desires a license under all of the Licensed Rights.
NOW,
THEREFORE,
in
consideration of the mutual covenants and agreements set forth below, the
parties covenant and agree as follows:
Section
1. Definitions.
For
the
purpose of this Agreement, the definitions of Appendix
A
shall
apply.
Section
2. Grant.
Subject
to the terms and conditions of this Agreement, CCF hereby grants to CBL an
exclusive license under the Licensed Rights to: (a) make, have made, develop,
use, import, export, distribute, market, promote, offer for sale and sell
Products, (b) practice any method, process or procedure within the Licensed
Patents or the CCF Technology, and (c) otherwise exploit the Licensed Rights
within the Licensed Territory for use within the Licensed Field; and to have
any
of the foregoing performed on its behalf by a third party. This grant shall
be
subject to the rights retained by CCF set forth in Section 2.G.
B. Affiliates.
CBL
may
extend the right and license granted to CBL under Section 2.A to any Affiliate
provided that such Affiliate consents to be bound by the terms of this Agreement
to the same extent as CBL.
CBL
and
any Affiliate may grant and authorize sublicenses within the scope of the right
and license granted to CBL pursuant to this Agreement, upon termination of
this
Agreement, any and all existing sublicenses shall survive; provided that such
sublicensees promptly agree in writing to be bound by the terms of this
Agreement.
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CBL
will
have an option to license additional inventions in the CCF Technology, which
are
not covered under Existing Patent Rights as follows:
(i) CCF
shall
promptly provide CBL with a written, enabling disclosure (“Invention Disclosure
Report”) with respect to any invention or discovery in the Licensed Field
conceived or reduced to practice, alone or jointly with others, by Doctor,
or by
other CCF personnel arising out of or in direct connection with work in Doctor’s
laboratory or under his direction (an “Option Invention”), during the term of
this Agreement.
(ii) CBL
shall
have the option to include any Option Invention within the CCF Technology for
all purposes of this Agreement. To exercise such option with respect to any
particular Option Invention, CBL shall notify CCF within sixty (60) days after
receiving an Invention Disclosure Report and a written request from CCF as
to
whether CBL wishes to acquire a license to such Option Invention. If CBL elects
to acquire such a license, the Option Invention shall be included within the
License Rights and all worldwide patents rights disclosing the Option Invention
shall be included with the Licensed Patents, both under this Agreement. CBL
and
CCF agree promptly to update Appendix
G
hereto
upon request by either party from time to time, to reflect all patents and
patent applications then within the Licensed Patents.
As
promptly as practicable following the date of this Agreement and on an ongoing
basis thereafter, CCF will disclose to CBL all Licensed Rights which are
licensed under this Agreement in such form as may be reasonable to describe
the
Licensed Rights to CBL clearly and economically.
(i) CBL
shall
have primary responsibility to (a) file and prosecute any domestic and/or
foreign patent application which discloses the Licensed Rights, and all
additional applications with respect to Improvements, and (b) maintain any
patent that may issue therefrom. All such patent applications and patents
issuing therefrom shall be deemed to be patent applications and patents within
the Licensed Patents and CCF shall have all right, title and interest therein,
subject to the license granted to CBL under this Agreement. All costs and
expenses of all such patent work, including preparation fees, filing fees,
taxes, annuities, working fees, issuance fees, maintenance fees, and/or renewal
and extension charges shall be paid by CBL.
(ii) CBL
shall
give CCF a reasonable opportunity to review (a) the text of all such
applications before filing, and (b) the content of any proposed responses to
official actions of the United States Patent and Trademark Office and foreign
patent offices during prosecution of such patent applications; and shall consult
with CCF with respect thereto. For purposes of this Section (ii), “reasonable”
shall mean sufficiently in advance of any decision by CBL or any deadline
imposed upon written response by CBL so as to allow CCF to meaningfully review
such decision or written response and also provide comments to CBL in advance
of
such decision or deadline to allow comments of CCF to be considered and
incorporated into CBL’s decision or written response.
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(iii) In
consultation with CCF, CBL will file patent applications within the Licensed
Patents, prosecute patent applications within the Licensed Patents, and maintain
patents within the Licensed Patents, in each case pursuant to CBL’s rights under
this Section 2.F in such countries as CBL may desire from time to time by notice
to CCF. In the event CBL does not file for or continue prosecution of any such
patent application within the Licensed Patents or maintain any such patent
pursuant to CBL’s rights under this Section 2.F, in any country, (a) CBL shall
notify CCF in writing pursuant to Section (iv) below, and in such event CCF
may
at its discretion pursue such filing, prosecution and/or maintenance, and (b)
CBL’s license with respect to such patent application and/or such patent in such
country shall terminate.
(iv) CBL
agrees to keep CCF informed in a timely manner of the contents, status and
progress of all patent applications within the Licensed Patents filed and
prosecuted by CBL, and to provide copies of such patent applications and
documents relating thereto to CCF. CBL agrees to provide CCF with such
information and documentation with respect to all Licensed Patents, as CCF
shall
reasonably request. CBL further agrees that CBL will not allow any such patent
application or any patent that may issue therefrom to become abandoned until
CCF
has determined, and informed CBL, that CCF does not desire to continue
prosecution or appeal(s) or maintenance of such patent application or patent
in
accordance with CCF’s rights pursuant to Section (iii) above; provided that
CBL’s obligations to continue prosecution or appeals(s) or maintenance of any
such patent application or patent will not extend beyond the three (3) month
anniversary of CBL’s written notice to CCF of CBL’s election pursuant to Section
(iii) above.
(v) In
the
event that CBL elects not to file any patent application within the Licensed
Patents, or thereafter elects not to continue prosecution of any such patent
application, or elects not to maintain any patent that may issue therefrom
pursuant to Section (iii) above, CCF shall have the right, at CCF’s option and
expense and in its own make, to file for and prosecute such patent application
and maintain such patent using patent counsel selected by CCF, and CBL shall
cooperate therewith.
All
licenses granted under Section 2 of this Agreement are subject to a reserved,
irrevocable, exclusive, fully-paid up non-assignable license back to CCF to
make
and use, for academic or research purposes only, any applicable CCF Technology,
the Licensed Patents and any Improvement or Innovation created by CBL or
CCF.
H. Right
to Publish.
Subject
to Section 19, all licenses granted under this Agreement (including, without
limitation, those set forth in Sections 2.A and 2.B) are subject to a reserved,
irrevocable, exclusive, fully-paid up non-assignable license back to CCF to
publish the general scientific findings from research related to the Licensed
Rights.
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A. Development
Plan.
(i) CBL
agrees to and warrants that it has the expertise necessary to independently
evaluate the inventions of the Licensed Patents and to develop Products for
sale
in the commercial market and that all licenses, rights and benefits granted
by
CCF to CBL under this Agreement are specifically contingent upon CBL’s diligent
and timely efforts to develop Products for the commercial market.
(ii) CBL
agrees to provide CCF within ninety (90) days of the execution and delivery
of
this Agreement with a Development Plan describing the steps necessary to allow
the inventions of the Licensed Patents to be utilized to provide Products for
sale in the commercial market. In addition, within sixty (60) days following
the
end of each semi-annual period of CBL’s fiscal year ending on June 30 and
December 31 (each, a “Half-Year”) for the term of this Agreement, CBL will
provide CCF with a written Development Report summarizing CBL’s product
development activities since the last Development Report and any necessary
adjustments to the Development Plan. All development activities and strategies
and all aspects of product design and decisions to market and the like are
entirely at the discretion of CBL, and CBL shall rely entirely on its own
expertise with respect thereto. CCF’s review of CBL’s Development Plan is solely
to verify the existence of CBL’s commitment to development activity and to
assure compliance with CBL’s obligations to utilize the inventions of the
Licensed Patents to commercialize Products for the marketplace, as set forth
in
Section 3.B. CCF reserves the right to audit CBL’s records relating to
development of Products as required hereunder. Such record keeping and audit
procedures shall be subject to the procedures and restrictions set forth for
audit of the financial records of CBL in Section 6.
(i) CBL
shall
use commercially diligent efforts to bring one or more Products to market as
soon as practical, consistent with sound and reasonable business practices
and
judgments. CBL shall be deemed to have satisfied its obligations under this
Paragraph (i) if CBL has an ongoing and active research, development,
manufacturing, marketing or sublicensing program, as appropriate, directed
toward bringing such Product to market in a timely fashion. Any efforts of
CBL’s
sublicensees shall be considered efforts of CBL for the sole purpose of
determining CBL’s compliance with its obligation under this Paragraph
(i).
(ii) If
in
CCF’s estimation, CBL is not fulfilling its obligations under Paragraph (i)
above and CCF so notifies CBL in writing, CCF and CBL shall negotiate in good
faith to revise the Exclusive License Agreement.
C. CBL
shall
be solely responsible for securing any federal, including U.S. Food and Drug
Administration (“FDA”), state, local or foreign Regulatory Approval necessary
for commercial sale of Products. Each Regulatory Approval shall be made in
CBL’s
name or in the name of an Affiliate or lawful designee of CBL unless applicable
law requires otherwise, or CCF and CBL otherwise agree that a particular
approval be made in the name of CCF or an Affiliate or lawful designee of CCF.
CCF agrees that, notwithstanding any such Regulatory Approval made in its name,
CBL retains the exclusive rights to make, have made, import, export, use,
distribute, promote, offer for sale and sell Products as granted to CBL in
this
Agreement. CCF will lend assistance on a reasonable basis to facilitate CBL’s
acquisition of necessary Regulatory Approvals for commercial sale. Such
assistance will include the provision to CBL as promptly as reasonably
practicable of scientific and clinical data obtained by CCF relating to the
Licensed Rights and the Products. CBL shall be responsible for reimbursing
CCF
for any reasonable direct costs associated with such activity.
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D. CBL
shall, at its own expense, use reasonable commercial efforts to develop and
obtain Regulatory Approvals for, and commercialize the Products in such
countries in the Licensed Territory where, in CBL’s sole opinion, it is
commercially desirable to do so. The parties acknowledge and agree that all
business decisions, including, without limitation, decisions relating to the
registration, manufacture, sate, commercialization, design, price, distribution,
marketing and promotion of Products covered under this Agreement, shall be
within the sole discretion of CBL. CCF acknowledges that CBL is in the business
of developing, manufacturing, marketing and selling biopharmaceutical products.
Nothing in this Agreement shall be construed as restricting CBL’s conduct of
such business or imposing on CBL the duty to market and/or sell Products for
which royalties are payable hereunder to the exclusion of, or in preference
to,
any other CBL product, or in any way other than in accordance with its normal
commercial practices.
Section
4. Consideration.
A. License
Fees.
In
partial consideration of the rights and licenses granted by CCF to CBL under
this Agreement, CBL agrees to issue to CCF within forty-five (45) days of the
execution and delivery of this Agreement the aggregate number of shares of
CBL
stock set forth in and subject to the terms of the Common Stock Subscription
Agreement set forth in Appendix
B.
For
each
Product developed by CBL, a CBL affiliate, or a joint venture in which CBL
is
involved, CBL shall pay to CCF Milestone Payments, creditable against Earned
Royalties, and Sublicense Royalties, as development of a Product progresses
through major developmental milestones as follows:
(1) For
Products limited to biodefense uses:
(i) For
any
INDA filing for a Product, $50,000;
(ii) For
any
Product entering Phase II clinical trials, $100,000;
(iii) For
any
PLA (Product License Application) or NDA filing for a Product,
$350,000; and
(iv) Upon
regulatory approval permitting any Product to be sold to the commercial market,
$1,000,000; or
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(2) For
all
other Products:
(i) For
any
INDA filing for a Product, $50,000;
(ii) For
any
Product entering Phase II clinical trials, $250,000;
(iii) For
any
Product entering Phase III clinical trials, $700,000;
(iv) For
any
PLA (Product License Application) or NDA filing for a Product, $1,500,000;
and
(v) Upon
regulatory approval permitting any Product to be sold to the commercial market,
$4,000,000;
provided
that the applicable milestone due CCF under this Section has not accrued on
another Product that is for the same (i) application; or (ii)
target.
C. Earned
Royalties.
(i) In
further consideration of the rights and licenses granted by CCF to CBL under
this Agreement, CBL agrees to pay CCF for each Product Sold in the commercial
market by CBL, a CBL affiliate, or a joint venture in which CBL is involved,
CBL
agrees to pay to CCF as “Earned Royalties” a royalty calculated as a percentage
of the Net Sales of Products in accordance with the terms and conditions of
this
Agreement. The royalty is deemed earned as of earlier of the date CBL receives
payment for the sale, lease or other disposition of the Product for
consideration or the date the Product is Sold to a consumer. Subject to the
terms of this Agreement, the royalty shall remain fixed while this Agreement
is
in effect as follows: (a) for any Licensed Patent which is solely owned by
CCF,
a rate of two percent (2%); (b) for any Licensed Patent which is jointly owned
by CCF and CBL, a rate of one percent (1%).
(ii) Royalties
due CCF under this Agreement shall be reduced by the amount of royalties, if
any, paid to third parties by CBL, its Affiliates or sublicensees in order
to
make, use or sell the Products, pursuant to agreements entered into in good
faith after the date of this Agreement with parties owning or controlling a
patent containing patent claims which, but for such agreements, would bar the
manufacture, use or sale of a Product derived from any of the Licensed
Rights.
(iii) The
obligation to pay royalties under this Agreement shall be waived and excused
to
the extent that statutes, laws, codes or government regulations (including
currency exchange regulations) of any foreign country in which Products are
sold
prevent such royalty payments by the seller of Products (whether CBL, its
Affiliates or sublicensees). In the event that royalty payments to CCF are
excused pursuant to this paragraph, the parties shall negotiate a mutually
acceptable arrangement that preserves the benefit of this Agreement for each
of
the parties;
(iv) If
a
compulsory license is granted to a third party with respect to a Product in
any
country in the Licensed Territory with a royalty rate lower than provided in
this Section 4.C, then the royalty rate to be paid by CBL to CCF on the selling
price in that country shall be reduced to the rate paid by the compulsory
licensee.
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(v) In
the
event that more than one patent within the Licensed Patents is applicable to
any
Product subject to royalties under Section 4.C or Section 4.D, then only one
royalty shall be paid to CCF as follows: (a) for more than one Licensed Patent,
each of which is solely owned by CCF, the royalty shall be at the rate of a
Licensed Patent solely owned by CCF, (b) for more than one Licensed Patent,
one
of which is jointly owned by CCF and CBL, the royalty shall be at the rate
of a
Licensed Patent jointly owned by CCF and CBL.
(vi) The
royalties payable under Section 4.C shall be paid on a country-by-country basis
on each Product until the expiration of all Licensed Patents which cover such
Product in such country.
(vii) In
the
event that more than one patent within the Licensed Patents is applicable to
any
Product subject to royalties under Section 4.C or Section 4.D, then the Earned
Royalties due CCF hereunder shall be equal to the amount calculated in Section
4.C(i) multiplied by X divided by Y, where “X” is the number of applicable
patents within the Licensed Patents that are solely owned by CCF and “Y” is the
total number of applicable patents within the Licensed Patents.
(i) In
further consideration of the rights and licenses granted by CCF to CBL under
this Agreement, CBL agrees to pay CCF for each Product Sold in the commercial
market by a Sublicensee as “Sublicensed Royalties” a royalty calculated as a
percentage of the royalties received from the Sublicenses equal to:
(a) Where
sublicenses have been granted by CBL prior to the filing of an INDA for a
Product, under the sponsorship of CBL, CBL shall pay to CCF the following
royalty rates for Product Sales: (1) for the sublicense of Licensed Patents
solely owned by CCF, thirty-five percent (35%) of any and all upfront
Sublicensing Fees, and thirty-five percent (35%) of all royalties received
from
the Sublicensee; or (2) for any sublicense of Licensed Patents which are jointly
owned by CCF and CBL, seventeen and one half percent (17 1/2 %) of any and
all
upfront Sublicensing Fees, and seventeen and one half percent (17 1/2 %) of
all
royalties received from the Sublicensee.
(b) Where
sublicenses have been granted after filing of an INDA for a Product, under
the
sponsorship of CBL, but prior to final approval of the relevant PLA/NDA, CBL
shall pay to CCF the following royalty rates for Product Sales: (1) for the
sublicense of Licensed Patents solely owned by CCF, twenty percent (20%) of
any
and all upfront Sublicensing Fees, and twenty percent (20%) of all royalties
received from the Sublicensee; or (2) for any sublicense of Licensed Patents
which are jointly owned by CCF and CBL, ten percent (10%) of any and all upfront
Sublicensing Fees, and ten percent (10%) of all royalties received from the
Sublicensee.
(c) Where
sublicenses have been granted after final approval of the relevant PLA/NDA
for a
Product, CBL shall pay to the following royalty rates for Product Sales: (1)
for
the sublicense of Licensed Patents solely owned by CCF, ten percent (10%) of
any
and all upfront Sublicensing Fees, and ten percent (10%) of all royalties
received from the Sublicensee; or (2) for any sublicense of Licensed Patents
which are jointly owned by CCF and CBL, five percent (5%) of any and all upfront
Sublicensing Fees, and five percent (5%) of all royalties received from the
Sublicensee.
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(ii) “Sublicense
Fees” shall mean all cash license fees received by CBL or an Affiliate upon
execution of a sublicense between CBL or an Affiliate with a Sublicensee
relating to Products (net of withholding taxes or other tax-related reductions
in accordance with Section 4.F(iii) herein), or equity (including options to
purchase equity) in the Sublicensee that CBL or an Affiliate receives upon
execution of such a sublicense in lieu of such a cash license fee. It is
understood that Sublicense Fees shall not include royalties, advances against
future royalties, Product development funds, equity investments, or scientific
benchmark payments or payments for past research expenditures relating to
development of Products. In addition, it is understood that this Section 4.D
shall not be deemed to require CBL to share with CCF any cash or equity received
by CBL in connection with an acquisition by a third party of all or
substantially all of the business or assets of CCF to which this Agreement
pertains.
Amounts
due to CCF under Sections 4.B, 4.C, and 4.D. of this Agreement will be accrued,
without interest, until such time as CCF’s equity ownership in CBL falls below
five percent (5%) of the total outstanding shares of CBL on a fully-diluted
basis or CBL has received more than thirty million dollars ($30,000,000) in
funding and/or revenues from non-CCF sources; provided however that any accrued
accounts will become due upon (i) liquidation of CBL, winding-up of the CBL’s
operations; (ii) termination of this Agreement; or (iii) to the extent such
amounts due to CCF are related to a particular patent application or patent
within the Licensed Patents for which CBL exercises its rights under Section
7.D.
(i) Subject
to Section 4.E, amounts owing to CCF under Sections 4.B, 4.C, and 4.D shall
be
paid on a semi-annual basis, with such amounts due and received by CCF on or
before the sixtieth (60th) day following the end of each Half-Year in which
such
amounts were earned. The balance of any amounts, which remain unpaid more than
thirty (30) days after they are due to CCF, shall accrue interest until paid
at
the rate of the lesser of one percent (1%) per month or the maximum amount
allowed under applicable law. However, in no event shall this interest provision
be construed as a grant of permission for any payment delays.
(ii) Except
as
otherwise directed, all amounts owing to CCF under this Agreement shall be
paid
in U.S. dollars to CCF at the address provided in Section 17.i. If any currency
conversion shall be required in connection with the payment of royalties
hereunder, such conversion shall be made at the rate used by CBL in calculating
CBL’s own revenues for financial reporting purposes.
(iii) Any
withholding or other tax that CBL or Affiliate are required by law to withhold
shall be deducted from said royalties and promptly paid to the taxing authority.
If royalties paid to CBL or Affiliate by a sublicensee on Net Sales of Products
are reduced for withholding or similar taxes, the Sublicense Royalties due
CCF
shall equal the amount calculated in Section 4.D multiplied by (1-X), where
“X”
equals the total percentage of Net Sales payable as any withholding or other
tax. In regard to any tax so deducted, CBL shall furnish CCF with proper
evidence of the taxes paid.
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(iv) A
full
accounting showing how any amounts owing to CCF under Section 4.C have been
calculated shall be submitted to CCF on the date of each such payment. Such
accounting shall be on a per-country and product line, model or trade name
basis
and shall be summarized either on the form shown in Appendix
C
of this
Agreement or in a reporting format that contains substantially similar
information. In the event no payment is owed to CCF, a statement setting forth
that fact shall be supplied to CCF.
Section
5. Representations
and Warranties.
A. CCF
represents and warrants that:
(i) except
to
the extent otherwise provided under Section 15 of this Agreement with respect
to
U.S. Government interests, it is the owner of the Licensed Rights free and
clear
of any lien, encumbrance, royalty or other payment obligation, and, to the
best
of its actual knowledge, without any conflict with or infringement of the rights
of any third party;
(ii) CCF
has
all requisite authority to execute and deliver this Agreement and perform its
obligations hereunder, including, without limitation, the right to grant the
licenses granted to CBL under this Agreement;
(iii) it
has
not previously assigned, transferred, conveyed or otherwise encumbered any
of
its right, title and interest in the Licensed Rights;
(iv) to
the
best of its actual knowledge, there are no third party pending patent
applications which, if issued, cover the development, manufacture, use or sale
of Products;
(v) there
are
no claims, judgments or settlements against or owed by CCF or pending or, to
the
best of its actual knowledge, threatened claims or litigation relating to the
Licensed Rights;
(vi) there
are
no collaborative, licensing, transfer, supply, distributorship or marketing
agreements or arrangements or other similar agreements to which it or any of
its
Affiliates are party relating to any of the Licensed Rights or Products;
and
(vii) neither
it nor its Affiliates shall enter into any oral or written agreement or
arrangement that would be inconsistent with its obligations under this
Agreement;
(viii) to
the
best of its knowledge, CCF does not own any rights in any other patent or patent
application, the claims of which would dominate the claims of a patent or patent
application within the Licensed Patents as applied to the Licensed Field, or
that claim any invention of Doctor relating to the Licensed Field.
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However,
nothing in this Agreement shall be construed as:
(i) a
warranty or representation by CCF as to the validity or scope of any of the
Licensed Patents;
(ii) except
to
the extent provided above in this Section 5.A, a warranty or representation
that
anything made, used, sold or otherwise disposed of under the license granted
in
this Agreement will or will not infringe patents of third parties;
or
(iii) an
obligation to furnish any know-how not provided in the Licensed Rights or any
services, other than those specified in this Agreement.
B. CCF
MAKES
NO REPRESENTATIONS, EXTENDS NO WARRANTIES OF ANY KIND, EITHER EXPRESS OR
IMPLIED, AND ASSUMES NO RESPONSIBILITIES WHATSOEVER WITH RESPECT TO USE, SALE,
OR OTHER DISPOSITION BY CBL OR ITS VENDEES OR OTHER TRANSFEREES OF PRODUCTS
INCORPORATING OR MADE BY USE OF INVENTIONS LICENSED UNDER THIS
AGREEMENT.
C. CBL
represents and warrants that Products produced under the license granted herein
shall be manufactured in accordance with all material respects with applicable
federal, state and local laws, rules and regulations, including, without
limitation, in accordance in all material respects with all applicable rules
and
regulations of the FDA.
Section
6. Recordkeeping.
A. CBL
shall
keep books and records sufficient to verify the accuracy and completeness of
CBL’s accounting referred to above, including without limitation inventory,
purchase and invoice records relating to the Products or their manufacture.
In
addition, CBL shall maintain documentation evidencing that CBL is in fact
pursuing development of Products as required herein. Such documentation may
include, but is not limited to, invoices for studies advancing development
of
Products, laboratory notebooks, internal job cost records, and filings made
to
the Internal Revenue Service to obtain tax credit, if available, for research
and development of Products. Such books and records shall be preserved for
a
period not less than three (3) years after they are created during and after
the
term of this Agreement.
B. CBL
shall
take all reasonable steps necessary so that the accounting firm representing
CBL, or any other registered CPA mutually agreeable to CCF and CBL, may within
sixty (60) days of request by CCF review and copy all the books and records
to
allow CCF to verify the accuracy of CBL’s royalty reports and Development
Reports. Such review shall be performed at the expense of CCF upon reasonable
notice and during regular business hours at a single U.S. location of CBL’s
choice.
C. If
a
royalty payment deficiency is determined, CBL shall pay the royalty deficiency
outstanding within thirty (30) days of receiving written notice thereof, plus
interest on outstanding amounts as described in Section 4.F(i). If a royalty
payment deficiency for a calendar year exceeds the lesser of five percent (5%)
of the royalties paid for that year or $50,000, then CBL shall be responsible
for paying CCF’s reasonable out-of-pocket expenses incurred with respect to such
review, but such payment shall not exceed the amount of the
deficiency.
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Section
7. License
Term and Termination Provisions.
A. The
term
(the “Term”) of this license shall begin on the date of this Agreement and
continue until this Agreement is terminated as provided herein or the payment
of
Earned Royalties under Section 4.C, once begun, ceases for more than one- (1)
year other than as a result of the circumstances described in Section 7.0 or
due
to reduction or off-set provisions in this Agreement.
B. Any
and
all licenses granted under this Agreement are strictly subject to CBL’s diligent
efforts to commercialize Products. CCF may, at its option terminate this
Agreement ninety days (90) after giving written notice of termination to CBL
during the continuation of any of the following events by CBL:
(i) failure
to achieve the mutually-agreed upon objectives set forth in the Development
Plan, as set forth in Appendix
D
attached
hereto and subject to the Research and Development Milestones, as set forth
in
Appendix
F
attached
hereto;
(ii) failure
to timely pay any monies due to CCF;
(iii) failure
to timely submit to CCF any Development Report;
(iv) commission
daily breach in any material respect of any other covenant herein
contained;
(v) committing
any act of bankruptcy, becoming insolvent, or unable to pay its debts as they
become due, filing a petition under any bankruptcy or insolvency act, or having
any such petition filed against it which is not dismissed within sixty- (60)
days; or
(vi) offering
any component of the Licensed Rights to its creditors or any other third party
in violation of this Agreement;
provided
that CBL may avoid such termination if before the end of such ninety (90) day
period CBL notifies CCF in writing that such breach or default has been cured.
However, if CBL disputes such breach in writing within such ninety (90) day
period, CCF shall not have the right to terminate this Agreement unless and
until a tribunal of competent jurisdiction has determined that this Agreement
was materially breached. Furthermore, this paragraph shall not suspend any
obligation of CBL to compensate CCF for any undisputed amount, as provided
for
under any term of this Agreement, during the pendency of any determination
of
breach.
C. Notwithstanding
the foregoing, the obligations of CBL with respect to the commercialization
of
Products under this Agreement are expressly conditioned upon the continuing
absence of a materially adverse condition which results in a delay in the
commercialization of the Products, including, but not limited to, a
substantially adverse condition or event relating to the safety or efficacy
of a
Product or unfavorable pricing, pricing reimbursement, labeling or lack of
Regulatory Approval, and the obligation of CBL to develop or market any such
Product, and CCF’s right to terminate this Agreement set forth in this Section
7.C, shall be delayed, tolled or suspended so long as such condition or event
exists (i) as mutually agreed by CBL and CCF; or (ii) as determined by
arbitration pursuant to Section 22.
Page
11
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D. CBL
may
terminate this Agreement in its entirety or as to any particular patent
application or patent within the Licensed Patents at any time by giving at
least
ninety- (90) days written notice of such termination to CCF. A brief statement
of the reasons for termination shall accompany such a notice. From and after
the
effective date of a termination under this Paragraph with respect to a
particular patent application or patent, such patent application and patent
in
the particular country shall cease to be within the Licensed Patents for all
purposes of this Agreement. Upon a termination of this Agreement in its entirety
under this Paragraph, all rights and obligations of CBL and CCF shall terminate,
except as provided in Section 7.F.
E. Upon
termination of this Agreement, CBL’s rights to the Licensed Rights or any
Improvement granted hereunder and all use thereof shall terminate and any and
all rights in the Licensed Patents and the CCF Technology shall revert back
to
CCF and, if requested by CCF, CBL shall destroy or return, at CCF’s sole option,
all copies of any media or materials which are the property of CCF, including
but not limited to all documentation, notes, plans, drawings, copies, samples
and computer code. Notwithstanding the termination of this Agreement, CBL shall
remain obligated to provide an accounting for and to pay royalties earned up
to
the date of the termination, subject to Section 4.C and all rights granted
to
CCF under this Agreement to any extant Innovations or Improvements shall remain
in effect.
F. Expiration
or termination of the Agreement shall not relieve the parties of any obligation
accruing prior to such expiration or termination, and the provisions of Section
2.B, the last sentence of Section 2.D.i, and Sections 2.F, 2.G, 7.E, 7.F, 16,
19, 22 and 23 shall survive the expiration or termination of this Agreement
and
remain in full force and effect regardless of the cause of termination. Any
expiration or early termination of this Agreement shall be without prejudice
to
the rights of either party against the other accrued or accruing under this
Agreement prior to termination.
G. Waiver
by
either party of a single breach or default, or a succession of breaches or
defaults, shall not deprive such party of any right to terminate this Agreement
in the event of any subsequent breach or default.
H. In
the
event that this Agreement is terminated for any reason, CBL, Affiliates and
customers of either CBL or an Affiliate may, after the effective date of such
termination, sell or otherwise dispose of all Products and parts therefor that
CBL, Affiliates and customers of either CBL or an Affiliate may have on hand
on
the effective date of such termination, subject to CBL’s payment to CCF of
royalties pursuant to Section 4 of this Agreement. Upon termination of this
Agreement for any reason, any sublicense granted by CBL or an Affiliate, if
any,
under this Agreement shall survive, provided that the sublicensee promptly
agrees in writing to be bound by the applicable terms of this
Agreement.
Page
12
of 30
Section
8. Assignability.
This
Agreement may not be assigned by CBL without the prior written consent of CCF,
which will not be unreasonably withheld provided that such assignee or
transferee promptly agrees in writing to be bound by the terms and conditions
of
this Agreement. CCF may assign its right to receive payments
hereunder.
Section
9. Contest
of Validity.
In
the
event CBL or a third party contests the validity of any Licensed Patent, CBL
shall continue to pay royalties with respect to that patent as if such contest
were not underway to an escrow agent mutually agreed to by the parties, to
be
held in a separate interest bearing account in accordance with the terms of
a
mutually acceptable escrow agreement between the parties in form and substance
as is customary for such purposes, until such time as a court of last resort
adjudicates the validity or invalidity of such patent. If such court of last
resort confirms the invalidity or unenforceability of such patent, then all
royalties previously paid by CBL into escrow pursuant to this paragraph,
together with all interest accrued thereon and any other amounts earned in
respect thereof (collectively, the “Escrow Funds”), shall be promptly paid to
CBL. If such court of last resort confirms the validity or enforceability of
such patent, then the Escrow Funds shall be promptly paid to CCF.
Section
10. Protection
of Licensed Rights.
CCF
and
CBL agree to assist each other to the extent necessary to protect any of CCF’s
or CBL’s rights in the Licensed Rights. CCF and CBL shall notify each other in
writing of any infringements by others of the Licensed Rights. Following receipt
of such notification, CCF and CBL shall engage in meaningful consultation as
to
the means of preventing such infringements and shall cooperate in any
preliminary steps, short of filing a lawsuit, including but not limited to
preliminary investigations, engagement of counsel and/or sending
cease-and-desist letters, that CCF and CBL shall mutually determine are required
prior to the filing of any lawsuit. Pursuant to Section 11 below, CBL may
commence or prosecute any claims or suits in its own name or join CCF as a
party
thereto. However, should CBL decline or fail to commence or prosecute such
claims or suits, CCF may itself institute such claims or suits in its own name
and join CBL as a party thereto, except that CCF shall not institute such claims
or suits without first obtaining the written consent of CBL to do so, which
consent shall not be unreasonably withheld, conditioned or delayed. CCF and
CBL
shall cooperate fully in any claims or suits commenced and prosecuted by either
party pursuant to this Section 10.
Section
11. Enforcement
of Licensed Rights.
A. CBL
has
the right, but not the obligation, to defend the Licensed Rights against
infringement, interference or opposition by other parties in any country,
including by bringing any legal action for infringement or opposition or
defending any counterclaim of invalidity, notice of opposition or action of
a
third party for declaratory judgment of non-infringement or interference. CBL
may bring or defend, or subject to CCF’s approval, which approval shall not be
unreasonably withheld, conditioned or delayed, may settle any such actions
solely at its own expense and through counsel of its selection; provided,
however, that CCF shall be entitled in each instance to participate through
counsel of its selection and at its own expense. CCF has no obligation or
responsibility with respect to any such infringement action or interference
except to provide reasonable assistance to CBL as requested, and CBL shall
reimburse CCF for its reasonable out-of-pocket expenses in connection with
any
such assistance. CBL shall be entitled to credit against royalties payable
to
CCF hereunder fifty percent (50%) of its out-of-pocket costs and expenses
incurred in connection with such action, including, without limitation, legal
fees, expert fees and related costs and expenses, at a rate not to exceed fifty
percent (50%) of the royalties due CCF in any Half Year. Any amounts entitled
to
be so credited and not previously credited may be carried forward. In the event
of a favorable settlement or award of damages, the amount received shall be
shared equally by CCF and CBL, provided that CBL may deduct from CCF’s share any
uncredited share of the above expenses. CCF’s sole financial obligation with
respect to such litigation will be limited to the right of CBL to credit fifty
percent (50%) of its costs and expenses against royalties as provided
herein.
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13
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B. In
the
event CBL is permanently enjoined from exercising any of the License Rights
granted hereunder pursuant to an infringement action brought by a third party,
or if CBL elects not to undertake the defense or settlement of such a claim
of
alleged infringement for a period of six (6) months from notice of such claim
or
suit, then CBL’s rights and obligations under this Agreement with respect to
said License Rights will terminate upon written notice of CCF, subject to
Section 7 of this Agreement. If CBL elects to defend any such action, then
CBL
shall be entitled to credit against royalties payable to CCF hereunder fifty
percent (50%) of its out-of-pocket costs and expenses incurred in connection
with such action at a rate not to exceed fifty percent (50%) of the royalties
due CCF in any Half Year. Any amounts entitled to be so credited and not
previously credited may be carried forward.
Section
12. Patent
Marking.
CBL
shall
xxxx all Products or Products’ packaging with the appropriate patent number
reference in compliance with the requirements of United States law (see 35
U.S.C. §287).
Section
13. Product
Liability and Conduct of Business.
A. CBL
shall, at all times during the term of this Agreement and thereafter, indemnify,
defend and hold CCF and its respective trustees, officers, employees, students,
and agents harmless against all claims and expenses, including legal expenses
and reasonable attorneys fees, arising out of the death of or injury to any
person or persons or out of any damage to property and against any other claim,
proceeding, demand, expense and liability of any kind whatsoever (other than
infringement claims) resulting from the production, manufacture, sale, use,
lease, consumption or advertisement of Products arising from any right or
obligation of CBL hereunder. CCF at all times reserves the right to select
and
retain counsel of its own to represent CCF’s interests in any such action,
subject to CBL’s sole control of the defense thereof and all related settlement
negotiations.
B. Neither
party shall be liable to the other party for any indirect, special,
consequential, or other damages whatsoever, whether grounded in tort (including
negligence), strict liability, contract or otherwise. Except as provided in
this
Agreement, CCF shall not have any responsibilities or liabilities whatsoever
with respect to Product(s).
Page
14
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C. CBL
shall
at all times comply in all material respects, through insurance or
self-insurance, with all statutory workers’ compensation and employers’
liability requirements covering any and all employees with respect to activities
performed under this Agreement.
D. CBL
warrants that it now maintains and will continue to maintain liability insurance
coverage that, based on industry experience, it believes to be appropriate
to
the risk involved in marketing the Products subject to this Agreement. Within
ninety (90) days after the execution of this Agreement and thereafter annually
between January 1 and January 31 of each year, CBL will present evidence to
CCF
that such coverage is being maintained. In addition, CBL shall provide CCF
with
at least ten (10) days prior written notice of any change in or cancellation
of
the insurance coverage.
Section
14. Use
of
Names.
CBL
shall
not use the name, logo, likeness, trademarks, image or other intellectual
property of CCF for any advertising, marketing, endorsement or any other
purposes without the specific prior written consent of an authorized
representative of CCF as to each such use. For purposes of the foregoing
provision, an authorized representative of CCF means a representative of CCF’s
Department of Media Relations and/or CCF’s Office of General
Counsel.
Section
15. United
States Government Interests.
It
is
understood that the United States Government (through one or more of its
agencies or otherwise) may have funded research resulting in the inventions
embodied in the Licensed Patents, and if so, the United States Government may
have certain rights relative thereto under the provisions of 35 U.S.C. §200-212
and applicable regulations of Chapter 37 of the Code of Federal Regulations.
This Agreement shall be subject to such rights under any such Government funding
agreement, applicable law or regulation. CCF represents and warrants that it
(i)
has complied and agrees to continue to comply during the term of this Agreement
with all laws and regulations applicable to such a Government funding agreement,
and (ii) has done and will continue to do all acts necessary to retain ownership
of all inventions within the Licensed Rights, including disclosing subject
inventions to the Government and electing to retain title in subject
inventions.
Section
16. Miscellaneous.
This
Agreement shall be governed, construed, and interpreted in all respects in
accordance with the laws of the State of Ohio without regard to that state’s
conflict of laws provisions. The parties hereto are independent contractors
and
not joint venturers or partners.
Page
15
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Any
notice required to be given pursuant to the provisions of this Agreement shall
be in writing and shall be deemed to have been given at the earlier of the
time
when actually received as a consequence of any effective method of delivery,
including but not limited to hand delivery, transmission by telecopier, or
delivery by a professional courier service or the time when sent by certified
or
registered mail addressed to the party for whom intended at the address below
or
at such changed address as the party shall have specified by written notice,
provided that any notice of change of address shall be effective only upon
actual receipt.
(i)
|
If
from CBL to CCF:
|
Communications
of a scientific nature to:
Xxxxxx
Xxxxxx, Ph.D.
The
Cleveland Clinic Foundation
Xxxxxx
Research Institute / NC-20
0000
Xxxxxx Xxxxxx
Xxxxxxxxx,
XX 00000
Communications
relating to use of name, intellectual property and/or licensing
to:
Commercialization
Counsel
CCF
Innovations / ND20
0000
Xxxxxx Xxxxxx
Xxxxxxxxx,
XX 00000
Payments
to:
The
Cleveland Clinic Foundation
Re:
CCF-CBL License
X.X.
Xxx
000000
Xxxxxxxxx,
XX 00000-0000
Attn:
Xx.
Xxxxx Xxx
The
CCF
Federal Tax ID Number is 00-0000000
(ii)
|
If
from CCF to CBL:
|
Cleveland
Biolabs, Inc.
00000
Xxxxxxxx Xxxxxx
Xxxxxxxxx,
Xxxx 00000
Attn:
Xxxxxxx Xxxxxxxx
Page
16
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With
a
copy to:
Howrey
Xxxxx Xxxxxx & White
000
X.
Xxxxx Xxxxxx
Xxxxx
0000
Xxxxxxx,
Xxxxxxxx 00000
Fax:
(000) 000-0000
Tel:
(000) 000-0000
Attn:
Xxxxx X. Xxxxx, Xx.
Section
17. Integration.
This
Agreement constitutes the full understanding between the parties with reference
to the subject matter hereof, and no statements or agreements by or between
the
parties, whether orally or in writing, except as provided for elsewhere in
this
Section 18, made prior to or at the signing hereof, shall vary or modify the
written terms of this Agreement. Neither party shall claim any amendment,
modification, or release from any provisions of this Agreement by mutual
agreement, acknowledgment, or otherwise, unless such mutual agreement is in
writing, signed by the other party, and specifically states that it is an
amendment to this Agreement.
Section
18. Severability.
If
any
provision of this Agreement is held to be invalid, the other provisions will
not
be affected to the greatest extent possible consistent with the parties’
intent.
Section
19. Confidentiality.
A. CBL
acknowledges that the CCF Technology is based upon and includes valuable trade
secrets and confidential information of CCF, the development of which reflects
the investment of considerable expertise and other resources. CCF acknowledges
that CBL may disclose valuable confidential information to CCF pursuant to
the
terms of this Agreement. Accordingly, both parties agree to keep any
Confidential Information and the CCF Technology in confidence and not to use
or
disclose the same except in pursuance of the terms of this
Agreement.
B. Both
parties agree to keep any information identified as confidential by the
disclosing party, confidential using methods at least as stringent as each
party
uses to protect its own confidential information. “Confidential Information”
shall include CBL’s Development Plan and development reports, CBL’s books and
records maintained pursuant to Section 6, all CCF Technology, Improvements,
the
Licensed Rights and all information concerning them and any other information
marked confidential or accompanied by correspondence indicating such information
is confidential exchanged between the parties hereto. Except as may be
authorized in advance in writing by the other party, each party shall grant
access to the Confidential Information only to its own employees involved in
research relating to the CCF Technology and/or manufacture or marketing of
the
Products, and each party shall require such employees to be bound by this
Agreement as well. Each party agrees not to use any Confidential Information
to
its advantage and the other party’s detriment, including, but not limited to, in
the case of CBL, claiming priority to any application serial numbers of any
Licensed Patents in any patent prosecution by CBL, The confidentiality and
use
obligations set forth above apply to all or any part of the Confidential
Information disclosed hereunder except to the extent that:
Page
17
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(i) the
recipient party can show by written record that it possessed the information
prior to its receipt from the other party;
(ii) the
information was already available to the public or became so through no fault
of
the recipient party;
(iii) the
information is subsequently disclosed to the recipient party by a third party
that has the right to disclose it free of any obligations of the disclosing
party; or
(iv) the
information is required by law or regulation to be disclosed; provided, however,
that the party subject to such disclosure requirement has provided written
notice to the other party promptly to enable such other party to seek a
protective order or otherwise prevent disclosure of such Confidential
Information.
C. The
parties agree to keep the nature, existence and terms of this Agreement
confidential until first publicly announced by the parties pursuant to a joint
press release mutually approved by the parties. The content and timing of all
press releases and similar public communications regarding this Agreement and
the subject matter hereof will be mutually agreed to in writing by the parties,
and neither party may make or issue any public announcement or press release
that refers to the other party or describes any aspect of this Agreement without
having first received the prior written consent of the other party.
Notwithstanding the foregoing, either party may make any public announcement
or
disclosure that it reasonably believes is required by law, rule or regulation
of
any governmental authority or other regulatory body (including, without
limitation, the SEC or the FDA).
D. Notwithstanding
the provisions of this Section 19, CBL shall have the right to disclose
Confidential Information, including CCF Technology, to its sublicensees, agents,
consultants, Affiliates or other third parties (collectively, “Agents”) in
accordance with this paragraph. Such disclosure shall be limited only to those
Agents involved in the research, development, manufacturing, marketing or
promotion of Products. Any such Agents must agree in advance and in writing
to
be bound by confidentiality and non-use obligations substantially similar to
those contained in this Agreement. In addition, CBL and its Agents may make
disclosure of such Confidential Information of CCF as may be necessary in order
to obtain or maintain any Regulatory Approvals, including, in connection with
clinical trials, regulatory applications and filings, and
otherwise.
Section
20. Anti-Kickback
Statute and Xxxxx Law Compliance.
By
entering into this Agreement, the parties specifically intend to comply with
all
applicable laws, rules and regulations, including (i) the federal anti-kickback
statute (42 U.S.C. § 1320a-7b) and the related safe harbor regulations; and (ii)
the Limitation on Certain Physician Referrals, also referred to as the “Xxxxx
Law” (42 U.S.C. §1395nn). Accordingly, no part of any consideration paid
hereunder is a prohibited payment for the recommending or arranging for the
referral of business or the ordering of items or services; nor are the payments
intended to induce illegal referrals of business. In the event that any part
of
this Agreement is determined to violate federal, state, or local laws, rules,
or
regulations, the parties agree to negotiate in good faith revisions to the
provision or provisions that are in violation. In the event the parties are
unable to agree to new or modified terms as required to bring the entire
Agreement into compliance, either party may terminate this agreement upon sixty-
(60) days prior written notice to the other party.
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By
signing this agreement, CBL hereby represents and warrants the following: (a)
that is has not been debarred, excluded, suspended or otherwise determined
to be
ineligible to participate in any federal health care programs (collectively,
“Debarment” or “Debarred”, as applicable); and (b) that it shall not knowingly
employ or contract with, with or without compensation, any individual or entity
(singularly or collectively, “Agent”) listed by a federal agency as Debarred. To
comply with this provision, CBL shall make reasonable inquiry into the status
of
any Agent contracted or arranged by CBL to fulfill the terms of this Agreement.
In the event that CBL and/or Agent either (i) becomes Debarred or (ii) receives
notice of action or threat of action with respect to its Debarment during the
term of this Agreement, CBL agrees to notify CCF immediately. CBL agrees to
timely notify CCF in the event that CBL has identified or reasonably suspects
potential violations associated with its performance under this Section, and
the
nature of such potential violation, to enable CCF to take prompt corrective
action. Further, in the event that CBL or Agent becomes Debarred as set forth
above and such Debarment shall have become final and non-appealable, this
Agreement relative to such entity or individual’s participation hereunder may be
terminated upon written notice.
Section
22. Alternative
Dispute Resolution.
A. The
parties shall attempt in good faith to resolve any dispute arising out of or
relating to this Agreement promptly between officials who have authority to
settle the controversy.
B. If
the
matter has net been resolved by negotiation within thirty- (30) days, the
parties shall attempt in good faith to settle the dispute by mediation under
the
then-current rules of the American Arbitration Association (“AAA”). The neutral
third party will be selected from the panel of neutrals of the AAA in accordance
with the selection process of the AAA.
C. If
the
matter has not been resolved by mediation within sixty- (60) days of the
initiation of such procedure, or if either party will not participate in a
mediation, the dispute shall be settled by arbitration in accordance with the
then-current Commercial Rules of Arbitration of the AAA, by a sole arbitrator
selected from the AAA panel of neutrals in accordance with its procedure for
the
selection of arbitrators. The United States Arbitration Act, 9 U.S.C. §1-16,
shall govern the arbitration, and any court having jurisdiction thereof may
enter judgment upon the award rendered by the arbitrator. The parties agree
that
any mediation or arbitration shall be held in Cleveland, Ohio.
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19
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Section
23. Authority.
The
persons signing on behalf of CCF and CBL hereby warrant and represent that
they
have authority to execute this Agreement on behalf of the party for whom they
have signed.
Section
24. Publication.
To
avoid
loss of patent rights as a result of premature public disclosure of patentable
information, CCF agrees to submit to CBL, at least forty-five (45) days prior
to
submission for publication or disclosure materials intended for publication
or
disclosure relating to inventions, discoveries or information within the
Licensed Rights, or that may include an Option Invention. CBL shall notify
CCF
within thirty-five (35) days of receipt of such materials whether CCF desires
to
file a patent application on any invention disclosed in such materials. In
the
event that CBL desires to file such a patent application, CCF shall withhold
publication and disclosure of patentable information for a period not to exceed
ninety (90) days from the date of receipt of such materials by CBL. Further,
if
such material contains Confidential Information that CBL has provided to CCF,
CCF agrees to remove such Confidential Information from the proposed publication
or disclosure. The parties understand and agree that the foregoing time periods
may be modified by written agreement of the parties.
IN
WITNESS WHEREOF,
the
parties hereto have duly executed this Agreement on the dates indicated
below.
THE
CLEVELAND CLINIC FOUNDATION:
|
|
By:
/s/
Xxxxxxx
X’Xxxxx
|
Date:
12/20
,
2004
|
Name: Xxxxxxx
X’Xxxxx
|
|
Title: Chief
Financial Officer
|
|
THE
CLEVELAND BIOLABS, INC.:
|
|
By:/s/
Xxxxxxx
Xxxxxxxx
|
Date:
12/20
,
2004
|
Name: Xxxxxxx
Xxxxxxxx
|
|
Title: Chief
Executive Officer
|
|
Acknowledged
(not a signatory):
|
|
By:
/s/
Xxxxxxxxxxx X.
Cobur
|
Date:
12/20
,
2004
|
Name: Xxxxxxxxxxx
X. Xxxxxx
|
|
Title: Executive
Director, CCF Innovations
|
Page
20
of 30
By:
/s/
Xxxxxx Xxxxxx,
PhD
|
Date:
12/20
,
2004
|
Name: Xxxxxx
Xxxxxx, PhD
|
|
Title: Chairman,
Department of Molecular Biology, The Cleveland Clinic
Foundation
|
|
By:/s/
Xxxx DiCorletto,
PhD
|
Date:
12/20
,
2004
|
Name: Xxxx
DiCorletto, PhD
|
|
Title: Director,
Xxxxxx Research Institute, The Cleveland Clinic Foundation
|
|
Approved
as to Form (not a signatory):
|
|
By:/s/
Xxxxxxxx X. Xxxxxxxxxxxx,
Esq.
|
Date:
12/20
,
2004
|
Name:
Xxxxxxxx
X. Xxxxxxxxxxxx, Esq.
|
|
Title:
Chief Commercialization Counsel
CCF
Innovations
|
Page
21
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APPENDIX
A
A. “Affiliate”
shall mean any individual or entity directly or indirectly controlling,
controlled by or under common control with, a party to this Agreement. For
purposes of this Agreement, the direct or indirect ownership of seventy-five
percent (75%) or more of the outstanding voting securities of an entity, or
the
right to receive seventy-five percent (75%) or more of the profits or earnings
of an entity shall be deemed to constitute control. For purposes of this
Agreement, the direct or indirect ownership of fifty percent (50%) or more
of
the outstanding voting securities of an entity, or the right to receive fifty
percent (50%) or more of the profits or earnings of an entity shall be deemed
to
constitute control upon written consent of CCF, which will not be unreasonably
withheld. Such other relationship as in fact results in actual control over
the
management, business and affairs of an entity shall also be deemed to constitute
control.
B. “CCF
Technology” shall mean all CCF’s unpatented inventions, know-how, trade secrets,
analysis, discoveries, techniques, methods, clinical and other data, and other
intellectual property relating to the research of Doctor or arising out of
or in
direct connection with work of Doctor in the field of regulating cell death:
(i)
curing cancer treatment side effects by differential modulation cell death
/
survival mechanisms uniquely deregulated in cancer cells; (ii) selective
sensitization of cancer cells to treatment by using the same approach; (iii)
using anti-apoptotic proteins secreted by microbial parasites to cure tissue
damage associated with cancer treatment, inflammation and other pathologies
(stroke, heart attack).
C. “Control”
or “Controlled” shall mean, with respect to any intellectual property right,
possession of the ability, whether by ownership or license, to assign, or to
grant a license, sublicense, immunities or other rights as provided for herein
to such item or under such right without violating the terms of any agreement
or
other arrangement with any Third Party.
D. “Development
Plan” shall mean CBL’s Products research and development plan having at least
the information specified in Appendix
D
to this
Agreement. The Development Plan shall be sent to the address specified in
Appendix
E.
E. “Development
Report” shall mean a written account of CBL’s progress under the Development
Plan having at least the information specified in Appendix
E
to this
Agreement.
F.
“Improvement” shall mean any modification of an invention described in the
Licensed Patents that, if unlicensed, would infringe one or more claims of
any
Licensed Patent.
G. “Innovation”
shall mean all inventions, discoveries and enhancements and all data resulting
in whole or in part from the practice of the Licensed Rights.
H. “Licensed
Field” shall mean shall mean the practice, production, manufacture, sale and use
of the Licensed Rights for the discovery, development and commercialization
of
methods, techniques, devices, systems, animals and therapeutics in the field
of
regulating cell death:
Page
22
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(i) CBLC100
series: small molecules that restore the activity of p53 tumor suppressor in
cancers, including renal cell carcinomas, sarcomas, prostate cancers and other
types of malignancies; curaxines and derivatives thereof are representative
examples of this category;
(ii) CBLB101
series: substances of biological nature (i.e., cytokines, chemokines and other
secreted molecules) and their bioactive derivatives produced by tumor cells
and
capable of modulating cell survival;
TGFβ2
and
derivatives thereof and derivatives thereof are representative examples of
this
category;
(iii) CBLB501
series: natural factors produced by extracellular parasites and symbionts of
humans and other mammalian species and their bioactive derivatives capable
of
modulating cell survival mechanisms of host cells; flagellin of Salmonella typhimurium
and
derivatives thereof are representative examples of this category;
(iv) CBLC500
series: small molecules modulating tumor and normal cell sensitivity to
cytotoxic chemicals by altering activity and substrate specificity of multidrug
transporters; inhibitors of MRP1 and derivatives thereof are representative
examples of this category.
I. Licensed
Patents.
(i) “Licensed
Patents” shall mean any and all rights in and to:
(a) the
patents and patent applications described in Appendix
G
hereto
(the “Existing Patent Rights”) and all patents anywhere in the world issuing
thereon;
(b) any
patent or patent application of any kind anywhere in the world that claims
or
discloses any of the Licensed Rights; and
(c) all
divisions, continuations, continuations-in-part, patents of addition, patents,
substitutions, registrations, reissues, reexaminations or extensions of any
kind
with respect to any of the foregoing applications and patents, and to the extent
the same claim and disclose an Option Invention, with respect to which CBL
exercises its option pursuant to Section 2.D above to include the same within
the Licensed Patents.
(ii) In
the
event that CCF is a joint owner of an invention by reason of the fact that
an
employee or consultant of CBL is a joint inventor of such an invention, it
is
understood that the Licensed Patents include only CCF’s rights as a joint owner
of the patents and patent applications that claim such joint invention. From
time to time during the term of this Agreement, upon request by either party,
CBL and CCF shall update Appendix
G
hereto
to include all patent applications and patents that are within the Licensed
Patents.
J. “Licensed
Rights” shall mean, collectively inventions, discoveries and information covered
by Licensed Patents or CCF Technology within the Licensed Field.
K. “Licensed
Territory” shall be worldwide.
Page
23
of 30
L. “Products”
shall refer to and mean any and all products that employ or are in any way
produced by the practice of the Licensed Rights.
M. “Regulatory
Approval” shall mean for each country in the Licensed Territory all permits,
consents and approvals required to lawfully manufacture, import, market, sell
and use Products in the Licensed Field.
N. “Net
Sales” shall mean the gross amount collected from sales of Products to the
end-user of such Products, less (i) trade, cash and quantity discounts actually
allowed or paid; (ii) credits, allowances and adjustments actually granted
to
customers; (iii) charge back payments and rebates granted to managed care
organizations or to federal, state, local or foreign governments, their
agencies, and purchasers and reimbursers or to trade customers, including,
but
not limited to, wholesalers and buying groups; (iv) separately itemized or
allocated (in direct proportion to the amount of sales of such Products bears
to
the total amount of sales of all CBL products) shipping costs, insurance or
other transportation costs, to the extent not paid or absorbed by non-Affiliate
purchasers of such Products; and (v) sales, use and/or other excise taxes or
duties actually paid. All costs shall be determined in accordance with generally
accepted accounting principles.
O. “Sales”
or “Sell” or “Sold” shall mean the transfer or disposition of a Product for
value to a party other than CBL or an Affiliate.
P. “Sublicensee”
shall mean the sublicensee, other than an Affiliate, of any Licensed
Rights.
Page
24
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APPENDIX
B
COMMON
STOCK SUBSCRIPTION AGREEMENT
Page
25
of 30
APPENDIX
C
CCF
ROYALTY REPORT (Example)
Licensee:__________________________________________
|
Agreement
No:___________________________________
|
||
Inventor:___________________________________________
|
CCF
Case No.____________________________________
|
||
Period
Covered: From: / /
|
Through: / /
|
||
Prepared
By: _______________________________________
|
Date:___________________________________________
|
||
Approved
By:________________________________________
|
Date:___________________________________________
|
||
If
license covers several major product lines, please prepare a separate report
for
each line. Then combine all product lines into a summary report.
Report
Type: Single Product Line Report:
_________________________________________
|
Multi-product
Summary Report. Page
1 of ____________ Pages
|
Report
Currency: U.
S. Dollars Other________________________________________
|
Country
|
Gross
Sales
|
Less
Itemized
Allowances
|
Net
Sales
|
Royalty
Rate
|
Period
Royalty Amount
|
|
This
Year
|
Last
Year
|
|||||
U.S.A.
|
||||||
Canada
|
||||||
Europe:
|
||||||
Japan
|
||||||
Other:
|
||||||
TOTAL:
|
||||||
Total
Royalty: ________________
|
Conversion
Rate: ________________
|
Royalty
in U.S. Dollars: $________________
|
Page
26
of 30
APPENDIX
D
DEVELOPMENT
PLAN
CBL
shall
submit a development plan of the scope outlined below to CCF within ninety-(90)
days of the execution of this Agreement In general, the plan should provide
CCF
with a summary overview of the activities that CBL believes are necessary to
make Products available for sale in the commercial marketplace. Please
note -
a
current or updated business plan may be substituted for a Development Plan
provided that specific milestones are identified in the plan and all of the
topics identified below are covered.
A. Development
Activities to be Undertaken
(Please
break activities into subunits with the date of completion of major
milestones)
1.
2.
.
.
B. Estimated
Total Development Time
II. Governmental
Approval
A. Types
of
submissions required
B. Government
agency e.g. FDA, USDA, etc.
III. Proposed
Market Approach
IV. Competitive
Information
A. Potential
Competitors
B. Potential
Competitive Devices/Compositions
C. Known
Competitor’s plans, developments, technical achievements
D. Anticipated
Date of Product Launch
Total
Length:
approximately 2-3 pages
Page
27
of 30
APPENDIX
E
A. Date
development plan initiated and time period covered by this report.
B. Development
Report (4-8 paragraphs).
1.
|
Activities
completed since last report including the object and parameters of
the
development, when initiated, when completed and the
results.
|
2.
|
Activities
currently under investigation, i.e., ongoing activities including
object
and parameters of such activities, when initiated, and projected
date of
completion.
|
C. Future
Development Activities (4-8 paragraphs).
1.
|
Activities
to be undertaken before next report including, but not limited to,
the
type and object of any studies conducted and their projected starting
and
completion dates.
|
2.
|
Estimated
total development time remaining before a product will be
commercialized.
|
D. Changes
to initial development plan (2-4 paragraphs).
1. Reasons
for change.
2. Variables
that may cause additional changes.
E. Items
to
be provided if applicable:
1.
|
Information
relating to Product that has become publicly available, e.g., published
articles, competing products, patents,
etc.
|
2.
|
Development
work being performed by third parties other than CBL to include name
of
third party, reasons for use of third party, planned future uses
of third
parties including reasons why and type of
work.
|
3.
|
Update
of competitive information trends in industry, government compliance
(if
applicable) and market plan.
|
CCF
Innovations
0000
Xxxxxx Xxxxxx / Xxxxxxxx X-00
Xxxxxxxxx,
XX 00000
Page
28
of 30
APPENDIX
F
RESEARCH
AND DEVELOPMENT MILESTONES
Page
29
of 30
APPENDIX
G
LICENSED
PATENT APPLICATION AND PATENTS
U.S.
Provisional Patent Application 60/526,538 - “Methods of Inhibiting
Apoptosis Using Latent TGFβ"
U.S.
Provisional Patent Application 60/526,666 - “Methods of Identifying of
Modulators of Apoptosis From Parasites and Uses Thereof”
U.S.
Provisional Patent Application 60/526,496 - “Methods of Inhibiting Apoptosis
Using Inducers of NF-kB”
U.S.
Provisional Patent Application 60/526,667 - “Methods of Inhibiting Apoptosis
Using Latent TGFβ”
U.S.
Provisional Patent Application 60/526,460 - “Methods of Protecting Against
Radiation Using Inducers of NF-kB”
U.S.
Provisional Patent Application 60/526,461 - “Methods of Protecting Against
Radiation Using Flagellin”
U.S.
Provisional Patent Application 60/571,149 - “Small Molecules Inhibitors of MRP1
and Other Multidrug Transporters”
U.S.
Provisional Patent Application 60/589,637 - “Activation of p53 and Inhibition of
NF-kB for cancer treatment”
Page
30
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