Exhibit 4.15
LICENSE AND OPTION AGREEMENT
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This License and Option Agreement (the "Agreement") effective as of December
19, 2001 by and between ILEX Oncology, Inc., a Delaware corporation having its
principal place of business at 0000 Xxxxxxx Xxxx Xxxx., Xxx Xxxxxxx, Xxxxx
00000-0000 ("ILEX") and Paralex, Inc., a Delaware corporation having its
principal place of business at 000 Xxxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx
Xxxx 00000 ("Paralex").
WHEREAS, ILEX has licensed certain know-how and rights relating to the
chemical known as Oxypurinol (the "Compound") in the United States from
Xxxxxxxxx Wellcome Co. ("BW"), now GlaxoSmithKline, PLC ("GSK"), and in the
non-United States territory from The Wellcome Foundation Limited ("WFL"); and
has developed its own body of Compound related know-how and intellectual
property rights, including manufacture, know-how, regulatory filings, clinical
trial information and trademark filings relating to the "OXYPRIM" trademark, all
of which are potentially useful and valuable in the development and
commercialization of the Compound;
WHEREAS, ILEX and Paralex previously entered into a Sublicense Agreement
dated June 22, 2001 (the "Sublicense Agreement") whereby ILEX sublicensed to
Paralex certain of the aforesaid Compound related rights from GSK and WFL as
welt as ILEX's own Compound related know-how and intellectual property rights as
summarized above, to facilitate development and commercialization of the
Compound in the Field;
WHEREAS, ILEX and Paralex now desire to rescind and otherwise terminate the
Sublicense Agreement in favor of this Agreement, in view of more recent clinical
results obtained by ILEX with respect to the use of the Compound in the Field.
NOW, THEREFORE, in consideration of the foregoing and mutual promises and
covenants set forth therein, ILEX and Paralex hereby agree as follows,
ARTICLE 1
Definitions
Any capitalized term not defined in this Agreement shall have the meaning
given such term in the Original License Agreement (as such term is defined
below). As used in this Agreement, the following terms, whether used in the
singular or the plural, shall have the following meanings:
1.1 "Development Agreement" means the Development Agreement between
Catalytica Pharmaceuticals, Inc. ("Catalytica") and ILEX Product, Inc.
dated August 18, 2000, a copy of which is attached hereto as Schedule
1.1.
1.2 "Effective Date" means the date hereof.
LICENSE AND OPTION AGREEMENT 12/20/2001
Page 2
1.3 "Field" means the treatment of hyperuricemia in humans who are
intolerant of allopurinol.
1.4 "FDA" means the United States Food and Drug Administration.
1.5 "GSK Know-How" means the Know-How as such term is defined in the
Original License Agreement.
1.6 "ILEX Clinical Trial Data Package" means the clinical trial data which
ILEX has acquired, and may in the future acquire, as of the Effective
Date hereof, in the current clinical trial, designated as OXPL-213 (the
"Clinical Trial"), which ILEX is sponsoring to evaluate the usage of
the Compound in the Field.
1.7 "ILEX Know-How" means (a) all technical information and data whether or
not patentable which is owned or licensed by ILEX and which is
reasonably necessary to manufacture the Compound or to use the Compound
in the Field, including ail pre-clinical and clinical data, regulatory
submissions, research, marketing data and any intellectual property
rights (including all patents and patent applications) and Know-How
relating to the Compound in the Field, other than the GSK Know-How; and
(b) the Oxypurinol IND, and Orphan Drug Designation, but excluding the
ILEX Clinical Trial Data Package.
1.8 "ILEX Trademark" means "OXYPRIM" trademark, including the U.S.
Trademark application Serial No. 75/624,684, which was allowed on
February 29, 2000, by the United States Patent and Trademark Office.
1.9 "Original License Agreement" means that certain License Agreement
effective as of March 31, 1995, between BW, WFL and ILEX, as amended in
that First Amendment of License Agreement dated June 1, 1998, and as
further amended in that Second Amendment of License Agreement dated
February 9, 2001, copies of which are attached as Schedule 1.9.
1.10 "Oxypurinol IND" means the IND (No, 3,362) filed by ILEX with the FDA
for Oxypurinol.
1.11 "Product" means the Compound or any product containing the Compound
which is made or developed using the GSK Know-How and/or the ILEX Know-
How.
1.12 "Sublicense Agreement" means the Sublicense Agreement dated effective
as of June 22, 2001 by and between ILEX and Paralex.
LICENSE AND OPTION AGREEMENT 12/20/2001
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1.13 "Third Party" means any party other than ILIAC, GSK, WFL, Paralex and
their respective Affiliates and Paralex's sublicensees, if any.
ARTICLE 2
Sublicense Agreement Termination
2.1 As of the effective Date hereof, ILEX and Paralex agree that the
Sublicense Agreement shall be rescinded and/or otherwise terminated in
favor of this Agreement, and the rights and obligations set forth in
this Agreement shall supersede and replace all of the rights granted
and obligations assumed in the Sublicense Agreement.
ARTICLE 3
Grants
3.1 Sublicense Grant. As of the Effective Date, and subject to the terms of
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this Agreement and the Original License Agreement, ILEX hereby grants
to Paralex an exclusive sublicense to all of ILEX's rights under the
Original License Agreement in the Field, in the Territory.
3.2 License Grant. As of the Effective Date, and subject to the terms of
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this Agreement and the Original License Agreement, ILEX hereby grants
to Paralex an exclusive license in all fields (including without
limitation the Field), in the Territory, with the right to sublicense
to the ILEX Know-How to make, have made, use, offer to sell and sell
Products.
3.3 Option Grant. As of the Effective Date, and subject to the terms of
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this Agreement and the Original License Agreement, ILEX hereby grants
Paralex an exclusive option to acquire ownership of, and full rights to
use the ILEX Clinical Trial Data Package (the "Option''). This Option
shall expire one (1) year after the Effective Date, and may be
exercised at any time during its term by Paralex providing written
notice to ILEX of the Option exercise. Upon exercise of the Option,
Paralex shall pay ILEX the Option Exercise Fee as set forth below in
Section 4.2.
3.4 Sublicense Rights. Paralex shall have the right to sublicense the
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license, sublicenses and other rights granted under this Article 3 to
one or more Affiliate(s) and Third Party sublicensee(s), provided that
Paralex agrees to be responsible for the performance hereunder by its
Affiliates and sublicensees to which such licenses and sublicenses
shall have been granted, subject to the prior written consent of ILEX,
which shall not be unreasonably withheld within thirty (30) days of
receipt of prior written notice of any proposed sublicense to
Affiliates or Third Party sublicensees.
LICENSE AND OPTION AGREEMENT 12/20/2001
3.5 Trademark License. As of the Effective Date and subject to the terms of
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this Agreement, ILEX hereby grants to Paralex an exclusive license,
with the right to sublicense to the ILEX trademark "OXYPRIM" for use in
connection with the selling, promotion and/or advertising of Product.
3.6 Reservation of Rights. ILEX hereby reserves for itself the perpetual,
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royalty -free right to use the ILEX Know-How solely for research
purposes in the Field including, but not limited to, the right to make,
have made and use the Products and to refer to the Oxypurinot IND in
any of its future regulatory filings with the FDA.
ARTICLE 4
Consideration
4.1 Agreement Initiation Fee. As an initial payment and partial
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consideration of ILEX's granting of the sublicense and licenses set
forth in Sections 3.1, 3.2 and 3.5 hereof, and the grant of the option
set forth in Section 3.3, Paralex shall pay to ILEX an initiation fee
of Two Hundred Fifty Thousand and 00/100 Dollars (5250,000) due and
payable on the Effective Date.
4.2 Option Exercise Fee. If Paralex elects to exercise the Option for the
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ILEX Clinical Trial Data Package at any time during the Option term set
forth in Section 3.3, Paralex shall pay to ILEX an Option Exercise Fee
of two Hundred Fifty Thousand and 00/100 Dollars ($250,000). This
Option Exercise Fee shall be due and payable within ten (10) days after
Paralex sends ILEX written notice of the Option exercise.
4.3 Assumption of Obligations under the Original License Agreement. As
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partial consideration for the sublicense, licenses and other rights
granted hereunder, Paralex shall (a) pay directly to GSK, as
applicable, the Milestone Payment recited in clause (iii) of Section
4.2 of the Original License Agreement and the royalties for Net Sates
of Product pursuant to Article 5, each as set forth (and defined) in
the Original License Agreement, and (b) perform directly the other
obligations of ILEX relating to the Product set forth in Article 6, 7
and 8 of the Original License Agreement, including specifically, the
Compassionate Plea Program set forth in Article B. Paralex shall not be
obligated to, and ILEX shall directly, perform all other obligations
pursuant to the Original License Agreement. Anything in this Agreement
to the contrary notwithstanding, Paralex shall have no obligation to
make any payment under Article 4 or 5 of the Original License Agreement
other than (i) in the case of the milestone payment pursuant to Section
4.2 (iii) of the Original License Agreement, upon approval by the FDA
of an NDA with respect to a hyperuricemic indication of the Product and
(ii) in the case of any royalties for Net Sales of Product (as defined
in the Original License Agreement), in respect of Net Sales of Product
in the Field. Except as expressly provided in the preceding sentence,
ILEX agrees and acknowledges that it will be responsible for all
payment obligations under Articles 4 and 5 of the Original License
Agreement.
LICENSE AND OPTION AGREEMENT 12/20/2001
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4.4 Milestone Payments. In addition to the payments under the Original
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License Agreement for which Paralex is responsible pursuant to Section
4.3 hereof, and as partial consideration for the sublicense, licenses
and other rights granted hereunder, Paralex shall make the following
cash milestone payments to ILEX:
i. $1 million upon successful completion of the first Phase II
clinical trial of the Product in a cardiovascular indication;
ii. $2 million upon FDA approval for marketing and commercial sale
of the first New Drug Application ("NDA") filed for a
cardiovascular indication of the Product;
iii. $5 million upon FDA approval for marketing and commercial sale
of the first NDA filed for a hyperuricemic indication of the
Product; provided, however, the foregoing milestone payment
shall be $4.9 million rather than $5 million if the GSK
Amendment has not become effective on or prior to the date on
which such payment is due;
iv. As an alternative to milestone payment (iii) only, (milestones I
and ii being independently payable, in any case) Paralex may, at
its option, make two payments to ILEX as follows:
(a) $2 million upon FDA approval for marketing and commercial
sale of NDA for the first hyperuricemic indication of the
Product; and
(b) $4 million upon first exceeding $15 million in annual Net
Sales for a hyperuricemic indication of the Product.
All milestone payments set forth in this Section 4.4 shall
become due and payable within sixty (60) days after the indicated
milestone is achieved (except that in the case of the milestone set
forth in Section 4.4, iv (b), if applicable, the milestone payment
shall become due and payable within ninety (90) days after the end of
the first fiscal year in which such Net Sales are achieved). Paralex
shall give ILEX timely written notice of each milestone achievement.
4.5 Royalty. As partial consideration for the sublicense, licenses and
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other rights granted hereunder, Paralex shall pay ILEX an earned
royalty based on cumulative Net Sales of Product in the Field in
accordance with the schedule set forth below in this Section; with the
further proviso that the obligation of Paralex to pay royalties on Net
Sales of Products in the Field in the Territory, shall not accrue until
such time as the cumulative Net Sales with respect to the Products in
the Field exceed One Million Five Hundred Thousand Dollars ($1,500,000)
(the "Threshold Amount"), and upon such time that Net Sales with
respect to the Products in the Field exceed the Threshold Amount,
LICENSE AND OPTION AGREEMENT 12/20/2001
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royalties shall be due and payable with respect to the aggregate amount
of Net Sales of the Products in the Field in the Territory, including
but not limited to with respect to Net Sales of Products in the Field
up to and including the Threshold Amount.
Royalty Schedule for Net Sales of Product in the Field
(a) 7.75% on Net Sales of the Product in the Field of the
first $25,000,000 of Net Sales;
(b) 5.0% on Net Sales of the Product in the Field in excess of
$25,000,000, but less than $100,000,000 of Net Sates; and
(c) 2.75% on Net Sales of the Product in the Field in excess
of $100,000,000 of Net Sales.
The royalty set forth above shall be due on all Net Sales
generated by sales of the Product solely pursuant to the initial FDA
label approval of Product for the Field.
In addition, Paralex shall pay ILEX an earned royalty of 2% on
Net Sales of Product for cardiovascular use, subsequent to any FDA
approval for marketing and commercial sale of a label indication for
the Product in the cardiovascular field; provided that the obligation
of Paralex to pay royalties on Net Sales of Products for cardiovascular
use shall not accrue until such time as the cumulative Net Sates of
Products for cardiovascular use exceed the Threshold Amount, and upon
such time that Net Sales of Products for cardiovascular use exceed the
Threshold Amount, royalties shall be due and payable with respect to
the aggregate amount of Net Sates of Products for cardiovascular use in
the Territory, including but not limited to with respect to Net Sales
of Products for cardiovascular use up to and including the Threshold
Amount. Royalties shall be payable to ILEX pursuant to Section 4.5
until the Expiration Date (as defined in Section 10.1) and shall be
payable and reportable on a periodic basis to ILEX in the same manner
as royalty is paid and reported to BW and GSK under Article 6 of the
Original License Agreement.
4.6 Trademark Use. From and after the First Commercial Sale of Product in
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the United States, Paralex agrees to use commercially reasonable
efforts to exploit the ILEX Trademark in connection with the marketing
and sales of the Product and to otherwise build value and goodwill for
the ILEX Trademark with respect to the Product; and Paralex shall also
provide all commercially reasonable assistance to ILEX in maintaining
and enforcing the ILEX Trademark against Third Party infringers and
shall not otherwise contest the validity of the ILEX Trademark, ILEX
shall have the sole right, at its own expense, to enforce the Trademark
against any Third Party infringers; provided, however, that if ILEX
fails to take commercially reasonable action to enforce the Trademark
LICENSE AND OPTION AGREEMENT 12/20/2001
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against a Third Party infringer within six (6) months following notice
of such alleged infringement by Paralex, then Paralex may take such
action as it may deem appropriate with respect to such enforcement, at
its own expense and ILEX shall provide all commercially reasonable
assistance to Paralex in connection therewith. In connection therewith,
Paralex shall implement document control and quality assurance
procedures to protect the ILEX Trademark from being diluted or
diminished in value during the term of this Agreement and in connection
therewith, Paralex agrees to permit ILEX to periodically inspect its
advertising, promotion and sales literature and activities to confirm
that reasonably suitable quality standards are iris place, In the event
that an inspection by ILEX reveals any need for corrective actions,
Paralex shall use all commercially reasonable efforts to perform such
corrective actions.
4.7 Technology Transfer Costs. Paralex shall also reimburse ILEX for all
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reasonable and actual out-of-pocket costs for transferring materials
and information comprising ILEX Know-How and the ILEX Clinical Trial
Data Package (if and when Paralex exercises the Option for that Data
Package) including any time expended by ILEX professional staff in the
requested transfer activities beyond ten (10) man days, with the
professional staff being billed at ILEX's standard services rates for
third party clients. These technical transfer costs and charges shall
be due and payable thirty (30) days after receipt by Paralex of an
invoice from ILEX itemizing such costs on a periodic (monthly) basis.
4.8 Accrual of Royalties. No royalty shall be payable on a Product made,
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sold or used for tests or development purposes or distributed as
samples. No royalties shall be payable on sales among Paralex and its
sublicensees, but royalties shall be payable on the initial subsequent
sales by Paralex or its sublicensees to a Third Party.
ARTICLE 5
Technology and Materials Transfer
5.1 Know-How. As promptly as practicable following the Effective Date and,
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in any event, within thirty (30) days thereafter, ILEX shall make
available to Paralex all of GSK Know-How, ILEX Know-How and all other
rights in the Field obtained from GSK in the Original License
Agreement. ILEX Know-How to be transferred shall include the Oxypurinol
IND and Orphan Drug Designation, all technical information relating to
Compound which is held by ILEX including information on Compound
manufacturing and Product formulation and all pre-clinical and clinical
information including information relating to the Compassionate Use
Program, except for the ILEX Clinical Trial Data Package. In addition,
ILEX will transfer its existing clinical inventory of Compound
(approximately 1500 bottles each, containing 100 capsules) to a
location designated in advance by Paralex, During the first ninety (90)
days after the Effective Date, ILEX will also make available its
professional staff, having the requisite knowledge at times reasonably
requested by Paralex, to answer questions posed by Paralex with regard
to the transferred technology and materials, provided the requests do
not cause ILEX to spend more than five (5) man days in any given
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consecutive thirty (30) day period and such technical assistance can be
provided from ILEX's offices.
5.2 ILEX Clinical Trial Data Package. As promptly as practicable following
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the Effective Date, ILEX shall deliver to Paralex copies of each
agreement between ILEX and a Third Party relating to the conduct of the
Clinical Trial (each, a "Clinical Trial Agreement"), all correspondence
with the FDA relating to the Clinical Trial and all data available in-
house and included in the ILEX Clinical Trial Data Package as of the
Effective Date. During the term of the Option, ILEX shall (a) deliver
copies of any such new data or correspondence to Paralex as promptly as
practicable after such data becomes available or such correspondence is
sent or received, (b) make its professional staff involved in the
conduct or monitoring of the Clinical Trial available to Paralex during
normal business hours upon Paralex's reasonable request to answer
questions regarding the conduct or results of the Clinical Trial, and
(c) give Paralex reasonable advance written notice of any proposed
meeting or conference call with the FDA regarding the Clinical Trial
and permit representatives of Paralex to attend any such meeting or
conference call as observers. ILEX will be responsible for the payment
of all expenses relating to the conduct of the Clinical Trial,
including without limitation all amounts payable to Third Parties
pursuant to the Clinical Trial Agreements and the transfer of the ILEX
Clinical Trial Data Package to Paralex pursuant hereto. During the term
of the Option, except as expressly provided in this Section 5.2, ILEX
will not change the protocol pursuant to which the Clinical Trial is
being conducted or amend any Clinical Trial Agreement without obtaining
the prior written consent of Paralex, which consent will not be
unreasonably withheld. Unless and until Paralex exercises the Option
and pays the Option Exercise Fee to ILEX, Paralex shall not use the
data and other information relating to the Clinical Trial made
available to it by ILEX hereunder except for the sole purpose of
determining whether to exercise the Option and if it does not timely
exercise the Option, will return all such data and other information to
ILEX promptly upon ILEX's request, with no rights to retain any copy
thereof. In making the ILEX Clinical Trial Data Package available to
Paralex under this Agreement, it is expressly understood and agreed by
the Parties that ILEX will stop OXPL-213 at approximately 15 patients
enrolled as of the Effective Date and that ILEX has no obligation to
continue any activity with regard to OXPL-213 other than stopping the
trial in an orderly fashion.
5.3 Bulk Compound Supply. Pursuant to the Development Agreement, ILEX has
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contracted for and anticipates receiving, within sixty (60) days after
the Effective Date, approximately 200kgs of cGMP bulk active Compound
("Bulk Active Order") suitable for clinical use, upon formulation into
finished drug product. Paralex, on its part, agrees to purchase its
requirements of bulk active Compound from ILEX, provided that the
quality of the Bulk Active Order of Compound meets the specifications
set forth in the Development Agreement, until such time as the Bulk
Active Order under the Development Agreement is fully consumed at (a)
ILEX's actual cost therefor (estimated to be about $800,000), if
purchased immediately after its receipt by ILEX or (b) ILEX's actual
cost plus 50%, if taken on a piecemeal, or as needed basis, Provided
further that Paralex shall be obligated to purchase the entire 200 kg
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bulk active Compound order from ILEX within the three (3) year period
after the Effective Date. The bulk active Compound shall be shipped
pursuant to Paralex's instructions to locations designated by Paralex
and ILEX shall warrant that the bulk active Compound, at time of
shipment, will meet specifications established in the Development
Agreement, with Paralex's sole remedy being refund of any payment made
for bulk active Compound failing the specifications. In the event of a
dispute arises as to whether the bulk active Compound failed
specifications, a sample shall be transferred to an independent testing
laboratory, mutually acceptable to ILEX and Paralex for reanalysis,
with the results of the independent; testing laboratory being binding
on the parties and the party found to be in error paying for the
reanalysis, After ILEX's receipt of the contracted 200kg supply of bulk
active Compound under the Development Agreement, ILEX will promptly
take all steps necessary to assign to Paralex all of ILEX's interest in
and rights under the Development Agreement and Paralex shall accept
such assignment, including all rights and any continuing obligations of
ILEX set forth therein. Notwithstanding such assignment, ILEX shall be
responsible for the performance of all of its obligations under the
Development Agreement, including without limitation the payment of all
amounts due to Catalytica in respect of the entire bulk Compound order,
through the effective date of such assignment. From the Effective Date
until Paralex has purchased the entire Compound order from ILEX
pursuant to this Section 5.3, (a) ILEX will promptly furnish Paralex
with copies of all reports or other documentation or information
supplied by Catalytica pursuant to Section 2.5 of the Development
Agreement, and (b) ILEX will not agree to any change in the
Specifications (as defined in the Development Agreement) without
obtaining Paralex's prior written consent, which will not be
unreasonably withheld.
ARTICLE 6
Representations, Warranties and Covenants
6.1 General. As of the effective Date, each party hereby represents and
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warrants to the other party that (a) it has the corporate power and
authority to execute and enter this Agreement and to carry out the
transactions contemplated by this Agreement; (b) it has duly and
validly authorized, executed and delivered this Agreement to the other
party; (c) the execution, delivery and performance by it of this
Agreement has been duly approved and authorized by all requisite
corporate and stockholder action and when delivered, this Agreement
constitutes, or will constitute, the legal, valid and binding
obligation of such party, enforceable against it in accordance with its
terms, subject to the availability and enforceability of equitable
remedies and to applicable bankruptcy and other taws relating to the
rights of creditors generally.
6.2 ILEX. ILEX shall use reasonable efforts to cause GSK to agree to amend
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Section 11.5 of the Original License Agreement or otherwise enter into
a binding agreement in form and substance reasonably satisfactory to
Paralex and its counsel (the "GSK Amendment") as promptly as
practicable so that GSK would be contractually obligated to (i)
continue this Agreement in the event that the original License
Agreement terminates for reasons other than the expiration of ILEX'S
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obligation to pay royalties to GSK thereunder or (ii) consent to any
assignment by ILEX to Paralex of the Original License Agreement.
6.3 ILEX. As of the Effective Date, ILEX represents that (a) it owns and
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possesses adequate and enforceable rights to license and sublicense all
of the ILEX Know--How, the ILEX Trademark and other intangible
property, including, but not limited to, all of ILEX'S rights,
obligations and duties under the Original License Agreement
(collectively the "Proprietary Rights") licensed and sublicensed or
proposed to be licensed and sublicensed to Paralex under this
Agreement; (b) to the best of its knowledge, it has taken all action
necessary to protect its Proprietary Rights, including, but not limited
to, the payment of all applicable maintenance fees, annuity payments,
taxes and any other costs required by applicable law or regulation
required to maintain the patent and trademark rights in full force and
effect; (c) it has not received any notice of, and there are no facts
known to ILEX that indicate the existence of (i) any infringement or
misappropriation by any Third Party of any of the Proprietary Rights or
(ii) any claim by a Third Party contesting the validity of any of the
Proprietary Rights; (d) it has not received any notice of any
infringement, misappropriation or violation by ILEX or any of its
employees of any Proprietary Rights of Third Parties, and to the best
of its knowledge, neither ILEX nor any of its employees have infringed,
misappropriated or otherwise violated any Proprietary Rights of any
Third Parties; (e) neither the execution nor delivery of this Agreement
conflicts with or will conflict with or result in a material breach of
(i) the terms, conditions or provisions of, or constitute a default
under, the Original License Agreement; (ii) ILEX'S Certificate of
Incorporation, as a amended, or its Bylaws; (iii) any law, ordinance,
regulation, order, writ, injunction or decree of any court or
administrative agency; or (iv) any other contract, agreement, license,
authorization, covenant or instrument under which ILEX or any of its
employees are now obligated; and (f) it is not aware of any receipt by
GSK or WFL of (i) any notice of infringement, misappropriation or
violation by GSK or WFL or any of their employees of any Proprietary
Rights of Third Parties or (ii) any claim by a Third Party contesting
the validity of any of GSK's or WFL's intellectual property related to
the GSK Know-How. Schedule 1.9 hereof contains a true, correct and
complete copy of the Original License Agreement. The Original License
Agreement has been duly and validly authorized, executed and delivered
by ILEX and, to the best of ILEX'S knowledge, GSK and WFL, and
constitutes the legal, valid and binding obligation of ILEX and, to the
best of ILEX'S knowledge, GSK and WFL, enforceable against each of them
in accordance with its terms. ILEX has made all payments required to be
made by it pursuant to the Original License Agreement through the
Effective Date, including without limitation the milestone payments
required pursuant to Sections 4.2(i) and (ii) thereof. The Original
License Agreement is, and ILEX shall use its best efforts to cause the
Original License Agreement to remain, in full force and effect, and
ILEX will use- its best efforts to timely perform all obligations
required to be performed by it thereunder (except for any such
obligations which are to be performed by Paralex to Section 4.3 from
and after the License Date.) ILEX will not agree to any amendment of
the Original License Agreement that would adversely affect the rights,
or increase the obligations, of Paralex under this Agreement without
the prior written consent of Paralex. ILEX will, no later than ten (10)
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Page 11
days following receipt of any notice from GSK or WFL under the Original
License Agreement forward a copy of such notice to Paralex.
6.4 Litigation. As of the Effective Date, ILEX represents that to the best
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of ILEX's knowledge, there is no action, suit, claim or proceeding at
law or in equity by or before any arbitrator, governmental
instrumentality or other agency now pending or, to the knowledge of
ILEX, threatened against ILEX (or basis thereof known to ILEX which
ILEX believes may result in the foregoing) the adverse outcome of which
would have a material adverse effect on the ability of ILEX to
consummate this Agreement or to carry out its duties pursuant to this
Agreement.
ARTICLE 7
Indemnification; Insurance
7.1 Indemnification by Paralex. Paralex agrees to indemnify and hold ILEX,
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GSK, WFL, their Affiliates, directors, officers, employees and agents
harmless from and against any liabilities or damages or expenses, fees
and other reasonable costs or expenses including without limitation,
reasonable attorneys' fees, in connection with, arising out of, or
resulting from (i) claims relating to Paralex's or its sublicensees' or
subcontractors' testing, use, manufacture or sale of the products or
(ii) any final, non-appealable judgment issued by a court of competent
jurisdiction against Paralex in favor of ILEX or GSK or WFL or any
other relevant Indemnitee under Section 7.3 of its indemnification
rights set forth in clause (i) of this Section 7.1.
7.2 Indemnification by ILEX. ILEX agrees to indemnify and hold Paralex, its
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Affiliates, directors, officers, employees and agents harmless from and
against any liabilities or damages or expenses, fees and other
reasonable costs or expenses including without limitation, reasonable
attorneys' fees, in connection with, arising out of, or resulting from
(i) claims relating to ILEX's or its sublicensees' (other than Paralex)
testing, use, manufacture or sale of the Products or (ii) any final,
non-appealable judgment issued by a court of competent jurisdiction
against ILEX in favor of Paralex or any other relevant Indemnitee under
Section 7.3 of its indemnification rights set forth in clause (i) of
this Section 7.2.
7.3 Indemnification Procedures. A party (the "Indemnitee") which intends to
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claim indemnification under this Article 7 shall promptly notify the
indemnifying party (the "Indemnitor'") in writing of any action, claim
or liability in respect of which the Indemnitee or any of its
Affiliates, directors, officers, employees or agents intend to claim
such indemnification. The Indemnitee shall permit, and shall cause its
Affiliates, directors, officers, employees and agents to permit, the
Indemnitor, at its discretion, to settle any such action, claim or
liability and agrees to the complete control or such defense or
settlement by the Indemnitor; provided, however, that such settlement
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does not adversely affect the Indemnitee's rights hereunder or impose
any obligations on the Indemnitee in addition to those set forth
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Page 12
herein, in order for it to exercise such rights. No such action, claim
or liability shall be settled without the prior written consent of the
Indemnitor (the consent to which shall not be unreasonably withheld),
unless such settlement, compromise or consent includes an unconditional
release of each Indemnitee hereunder from all liability arising out of
such action, claim or liability, and the Indemnitor shall not be
responsible for any legal fees or other costs incurred other than as
provided herein. The Indemnitee and its Affiliates, directors,
officers, employees and agents shall cooperate fully with the
Indemnitor and its legal representatives in the investigation and
defense of any action, claim or liability covered by this
indemnification. The Indemnitee shall have the right, but not the
obligation, to be represented by counsel of its own selection and
expense.
7.4 Insurance.
---------
(a) Following the Effective Date, Para(ex shall purchase and
maintain, at its own expense, during the term of this Agreement,
and for a minimum of two (2) years following the expiration,
termination or cancellation of this Agreement, a product
liability policy from an insurance company or companies
reasonably satisfactory to ILEX, GSK and WFL. During any
clinical development of the Product, such coverage shall be for
at least $2,000,000 per occurrence, Promptly upon commercial
introduction of the initial Product, the parties shall negotiate,
in good faith, an increase in such coverage. The insurance policy
relating to such coverage shall name ILEX, GSK and WFL as
additional insureds by way of endorsement or otherwise as their
respective interests may appear.
(b) Within 30 days after the Effective Date hereof, Paralex shall
cause to be delivered to ILEX an insurance certificate evidencing
the insurance coverage required by this Section 7.4. Such
insurance certificate shall name ILEX, GSK and WFL as additional
insureds as their respective interests may appear.
ARTICLE 8
Royalty Reports and Accounting
8.1 ILEX Rights. At the request of ILEX, Paralex will provide to ILEX at
------------
least five business days before the date required under the Original
License Agreement, a copy of all royalty reports and accounting as
required to be provided by ILEX to GSK and WFL under the terms of the
Original License Agreement. In addition to any auditing reports GSK is
entitled to under the Original License Agreement, Paralex shall grant
to ILEX; at ILEX'S sole expense, the right to audit Paralex's books
once a year, during normal business hours, under the same conditions as
specified in the Original License Agreement.
LICENSE AND OPTION AGREEMENT 12/20/2001
Page 13
ARTICLE 9
Confidentiality
9.1 Treatment of Confidential Information. Except as otherwise provided in
--------------------------------------
this Article 9, during the term of this Agreement, and for a period of
five (5) years following the later of the termination or expiration of
(i) this Agreement or (ii) the Original License Agreement:
(a) Paralex will retain in confidence and use only for purposes of
this Agreement, any information and data supplied by or on behalf
of ILEX, GSK and WFL to Paralex under this Agreement; and
(b) ILEX will retain in confidence and use only for purposes of this
Agreement, any information and data supplied by or on behalf of
Paralex to ILEX under this Agreement
For purposes of this Agreement, all such information and data
which a party is obligated to retain in confidence shall be called
"Information" Paralex agrees that all information and data disclosed by
GSK to ILEX pursuant to the Letter Agreement shall be covered as
Information under the confidentiality sections of the Original License
Agreement.
9.2 Right to Disclose. To the extent it is reasonably necessary or
------------------
appropriate to fulfill its obligations or exercise its rights under
this Agreement or any rights which survive termination or expiration
thereof, a Party may disclose Information to its Affiliates,
sublicensees (actual and prospective), investors (actual and
prospective), consultants, outside contractors and clinical
investigators; provided, however, that all such entities and persons
-------- -------
agree (i) to keep the Information confidential for at least the same
time periods and to the same extent as each party is required to keep
Information confidential and (ii) to use the Information only for such
purposes as such party is entitled to use the Information. Each party
or its Affiliates or, if applicable, its sublicensees, may disclose
such Information to government or other regulatory authorities to the
extent that such disclosure (a) is reasonably necessary to obtain
patents or authorizations, to conduct clinical trials and to market
commercially the Product, provided such party is otherwise entitled to
engage in such activities under this Agreement or (b) is otherwise
required by applicable laws or regulations.
9.3 Release From Restrictions. The obligation not to disclose Information
--------------------------
shall not apply to any part of such Information that (i) is or becomes
patented, published or otherwise part of the public domain other than
by acts of the party obligated not to disclose such information (for
purposes of this Article 9, the "Receiving Party") or its Affiliates or
sublicensees in contravention of this Agreement; (ii) is rightfully
disclosed to the Receiving Party or its Affiliates or sublicensees by a
Third Party; provided, such Information was not obtained, directly or
indirectly, from the other party under this Agreement; (iii) prior to
LICENSE AND OPTION AGREEMENT 12/20/2001
Page 14
disclosure under this Agreement, was already in possession of the
Receiving Party or its Affiliates or sublicensees, provided, such
Information was not obtained, directly or indirectly, from the other
party under this Agreement under an obligation of confidentiality; (iv)
results from research and development by Receiving Party or its
Affiliates or sublicensees independent of disclosures from the other
party under this Agreement; (v) has been approved for publication by
the parties hereto; or (vi) is Product-related information which is
reasonably required to be disclosed in connection with the marketing of
the Product.
9.4 Confidentiality of Agreement. Except as otherwise required by law or
-----------------------------
applicable regulations or the terms of this Agreement, or otherwise
mutually agreed upon by the parties hereto, each party shall treat as
confidential the terms, conditions and existence of this Agreement and
the Original License Agreement, Notwithstanding the foregoing, the
terms, conditions and existence of this Agreement and the Original
License Agreement may be disclosed by (i) either party to an Affiliate,
(ii) Paralex to a sublicensee, and (iii) Paralex to Paramount Capital,
Inc., or any other investment banker, placement agent, financial
advisor, finder, attorney, accountant, agent, representative or
prospective or actual investor to the extent that such disclosure is
necessary for Paralex to conduct a financing; provided, however, that
any such recipient of any disclosure pursuant to this Section 9.4 must
agree to be bound by the terms and conditions of this Section 9.4 to
the same extent as Paralex.
9.5 Right to Publication. ILEX agrees that Paralex shall have the right to
--------------------
publish or to present publicly (collectively, a "Publication") the
results of any research, work or other development performed pursuant
to this Agreement by or on behalf of Paralex (collectively, "Results").
Paralex agrees to submit any proposed Publication to ILEX, for its
review at least thirty five (35) days prior to submission or
presentation of such Publication. If ILEX requests a delay in
submission or presentation based on patent considerations, Paralex
agrees to delay such submission or presentation for a period not to
exceed ninety (90) days from the date of such request. Paralex further
agrees to give due consideration to any comments made by ILEX or GSK,
with respect to such publication but, except as set forth in the
immediate following sentence, Paralex shall determine the content of
the Publication. Nothing in this Section 9.5 shall be construed to
allow Paralex to publish or otherwise disclose any Information
disclosed to Paralex by ILEX.
ARTICLE 10
Term and Termination
10.1 Term; Termination. This Agreement shall be effective as of the
------------------
Effective Date and shall continue in full force and effect until the
date of the expiration of ILEX's obligation to pay royalties under the
Original License Agreement, which, for the avoidance of doubt, shall be
determined on a country by country basis as provided in the second
paragraph of Section 5.1 of the Original License Agreement (the
"Expiration Date"); at which time, notwithstanding anything to the
LICENSE AND OPTION AGREEMENT 12/20/2001
Page 15
contrary contained herein, all rights licensed or sublicensed to
Paralex herein shall be deemed to be converted to a fully paid, non-
exclusive, irrevocable, royalty free license or sublicense of the
Know-How and ILEX Know--How to Paralex in such country or countries so
that Paralex may make, have made, use, offer to sell, sell and have
sold the Product. Upon expiration or termination of this Agreement with
respect to one or more countries of the Territory, the rights and
obligations of the parties shall cease with respect to such country,
except as follows:
(i) the rights and obligations of the parties under Article 7
shall survive termination or expiration;
(ii) upon expiration or termination for any reason, the
obligations of Section 9.1 through 9.5 shall survive for the
periods provided therein;
(iii) upon termination, Paralex's obligations under Section 10.3,
10,4 and 10.5 shall survive;
(iv) expiration or termination of this Agreement shall not
relieve the parties of any other obligation accruing prior
to such termination; or
(v) any rights or obligations under the Original License
Agreement which survive termination or expiration,
To the extent relevant to the other survival provisions, Article 11
(Miscellaneous Provisions) shall also survive.
10.2 Termination for Cause. (a) ILEX will have the right, but not the
----------------------
obligation, to terminate this Agreement upon written notice to Paralex
following the occurrence of any of the following:
(i) upon or after the bankruptcy, dissolution, Paralex's general
failure to pay its debts and other liabilities as they
become due or the winding up of Paralex (other than
dissolution or winding up for the purposes of reconstruction
or amalgamation); or
(ii) upon or after the breach of any material provision of this
License Agreement by Paralex if such breach is not cured
within thirty (30) days after ILEX gives Paralex written
notice thereof.
LICENSE AND OPTION AGREEMENT 12/20/2001
Page 16
(b) Paralex will have the right, but not the obligation, to terminate
this agreement upon written notice to ILEX following the occurrence of any of
the following:
(i) upon or after the bankruptcy, dissolution, ILEX's general
failure to pay its debts and other liabilities as they
become due or the winding up of ILEX (other than dissolution
or winding up for the purposes of reconstruction or
amalgamation); or
(ii) upon or after the breach of any material provision of this
License Agreement by ILEX if such breach is not cured within
thirty (30) days after Paralex gives ILEX written notice
thereof; or
(iii) upon or after the termination of the Original License
Agreement.
10.3 Paralex Obligations Upon Termination.
-------------------------------------
(a) upon termination of this agreement pursuant to Section 10.2(a):
(i) Paralex shall promptly pay ILEX and GSK any amounts due
under the terms of this Agreement including the
royalties which have accrued as of termination;
(ii) Paralex agrees to cooperate fully with ILEX, or its
respective nominees, to transfer or to hand over to ILEX
or its respective nominees, health registrations and
sales permissions regarding the Products in the country
or countries in which termination has occurred; and
(iii) in the event of termination with respect to all
countries of the Territory, Paralex shall return to ILEX
all copies of the Information supplied hereunder, except
that Paralex's legal department may retain one copy of
the Information for purposes of determining the scope of
its obligations hereunder.
(b) Upon termination of this Agreement pursuant to Section 10.2(b),
Paralex shall have a fully paid, non-exclusive, irrevocable,
royalty free license or sublicense of the ILEX Know-How to
Paralex in the Territory; provided, that the Oxypurinol IND and
any other filing made by ILEX with the FDA or any other
government or regulatory authority that relates to the ILEX Know
-How, and all data contained therein, shall be, and continue to
be, the sole property and asset of Paralex; provided, further
that ILEX shall maintain the right to refer to the Oxypuhnol IND
in any of its future regulatory filings with the FDA.
LICENSE AND OPTION AGREEMENT 12/20/2001
Page 17
10.4 Disposition of Product. Upon termination of this Agreement pursuant to
----------------------
Section 10.2(a), Paralex shall provide ILEX with a written inventory of
the Product (in the form of raw materials, work-in-process and finished
goods) in its and its sublicensees' possession and shall have the right
to dispose of such Product within six (6) months thereafter, subject to
fulfillment of its royalty obligations relating thereto.
10.5 Sublicensees Upon Termination. If any party terminates this Agreement
------------------------------
and sublicensees of Paralex are not then in default under the terms of
this sublicense agreements, ILEX shall have the obligation to assume
and continue such sublicense agreements with payments thereunder being
made by the sublicensees directly to ILEX.
ARTICLE 11
Miscellaneous
11.1 Assignment. This Agreement and the rights and duties pertaining hereto
----------
may not be assigned by either party without first obtaining the written
consent of the other party, which consent shall not be unreasonably
withheld, and any such purported assignment without the written consent
of the other party shall be null and void and of no force or effect;
provided, however, that no such consent shall be required in connection
with a merger or consolidation by either party with another company or
with respect to an assignment by it in connection with a sale of all or
substantially all, of its assets and properties; provided, further,
that ILEX may assign its tights, obligations and duties under this
Agreement, without Paralex's consent, to any assignee of ILEX's rights,
obligations and duties relating to the Field under the Original License
Agreement pursuant to a transfer or assignment thereof; provided,
however, that notwithstanding anything to the contrary in this Section
11.1, ILEX may not assign this Agreement prior to Paralex's receipt of
the GSK Amendment.
11.2 Registration. Paralex agrees to register or give required notice
------------
concerning this Agreement, through itself or through a sublicensee, in
each country of the Territory where there exists an obligation under
law to so register or give notice, to pay all costs and legal fees
connected therewith and shall otherwise comply with all national laws
applicable to this Agreement.
11.3 Force Mature. A party shall not be held liable or responsible to
-------------
another party and not be deemed to have defaulted under or breached
this Agreement for failure or delay in fulfilling or performing any
term of this Agreement, when such failure or delay is caused by or
results from fires, floods, embargoes, government regulations,
prohibitions or interventions, wars, acts of war (whether war be
declared or not), insurrections, riots, civil commotion, strikes,
lockouts, acts of God, or any other cause beyond the reasonable control
of the affected party and which have a material adverse impact on the
ability of the affected party to perform its obligations hereunder.
LICENSE AND OPTION AGREEMENT 12/20/2001
Page 18
11.4 Severability. Each party hereby expressly agrees and contracts that it
------------
is not the intention of any party to violate any public policy,
statutory or common laws, rules, regulations, treaty or decision of any
government agency, or executive body thereof, of any country or
community or association of countries, that if any word, sentence,
paragraph, clause or combination thereof in this Agreement is found by
a court or executive body with judicial powers having jurisdiction over
this Agreement or any of the parties hereto in a final in a final
unappealed order to be in violation of any such provisions in any such
country or community or association of countries, such words,
sentences, paragraphs, clauses and/or any combination thereof shall be
inoperative in such country, community or association of countries and
the remainder of this Agreement shall remain binding upon the parties
hereto.
11.5 Notices. Any notice required or permitted to be given hereunder shall
-------
be in writing and shall be deemed to have been properly given if
delivered in person, or if mailed by registered or certified mail
(return receipt requested), postage prepaid, or by facsimile (and
promptly confirmed by such registered or certified mail), to the
addresses given below or such other addresses as may be designated in
writing by the parties from time to time during the term of this
Agreement. Any notice sent by registered or certified mail as aforesaid
shall be deemed to have been given when mailed.
In case of ILEX: ILEX Oncology, Inc.
0000 Xxxxxxx Xxxx Xxxx.
Xxx Xxxxxxx, Xxxxx 00000-0000
Attention: President
Telephone: 000 000 0000
Facsimile: 000 000 0000
In the case of Paralex: Paralex, Inc.
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: President
Telephone: 000 000 0000
Facsimile: 000 000 0000
11.6 Governing Law. This Agreement shall be governed by and construed in
--------------
accordance with the laws of the State of Delaware, exclusive of its
choice-of-law rules.
11.7 Arbitration. All disputes arising in connection with this Agreement
-----------
shall be finally settled under the Commercial Arbitration Rules of the
American Arbitration Association. Arbitration shall take place in New
York, New York.
11.8 Entire Agreement. This Agreement and the Original License Agreement
----------------
contain the entire understanding of the parties with respect to the
subject mater hereof. All express or implied agreements and
LICENSE AND OPTION AGREEMENT 12/20/2001
Page 19
understandings, either oral or written, heretofore made are expressly
merged in, and made a part of this Agreement.
11.9 Modification. The parties hereto may alter any of the provisions of
------------
this Agreement, but only by a written instrument duly executed by both
parties hereto.
11.10 Limitation of Authority. No Party shall have any authority arising out
-----------------------
of this Agreement to create any implied or express liability or
obligation in the name or on behalf of any other Party, and no Party
shall enter into any contract with any person or entity that purports
to bind any other Party.
11.11 Waiver. The failure of a party to enforce at any time for any period
------
any of the provisions hereof shall not be construed as a waiver of such
provisions or of the rights of such party thereafter to enforce each
such provision.
11.12 Counterparts. This Agreement may be executed in any number of
------------
counterparts, each of which shall be deemed an original but all of
which together shall constitute one and the same document.
11.13 Captions. The captions to the several Articles and Section hereof are
--------
not a part of this Agreement, but are merely guides or labels to assist
in locating and reading the several Articles and Section hereof.
11.14 Responsibility for Expenses. Each Party is responsible for its own
----------------------------
expenses related to the preparation and execution of this Agreement.
11.15 Informed Review. Each Party acknowledges that it and its counsel have
----------------
received and reviewed this Agreement and that normal rules of
construction, to the effect that ambiguities are to be resolved against
the drafting Party, shall not apply to this Agreement or to any
amendments, modifications, exhibits or attachments to this Agreement.
11.16 Non-Competition. From the Effective Date and for two years after the
----------------
termination of this Agreement, ILEX shall not in any manner, directly
or indirectly, on behalf of itself or any person, firm, partnership,
joint venture, corporation or other business entity (each, a "Person"),
enter into or engage in any business which researches, develops,
manufactures or distributes Oxypurinol, including any crystalline
structure thereof ("Oxypurinol Compounds"), other than for treatments
for cancer whether as an individual for its own account, or as a
proprietor, partner, strategic partner, member, joint venturer, or
shareholder of a Person operating or intending to operate within the
area of the research, development, manufacture or distribution of
LICENSE AND OPTION AGREEMENT 12/20/2001
Page 20
Oxypurinol Compounds, provided, however, that nothing in this Section
11 .1A shall prohibit ILEX from performing contract research services
with respect to Oxypurinot Compounds on behalf of Third Parties where
the consideration arising out of at relating to such services is not,
whether in whole or In part, royalty. or equity-based; provided,
further, that this Section 11.16 shall not apply if ILEX completes a
merger, consolidation or similar transaction or a sale or conveyance to
another Person of all or substantially all the property, assets or
equity securities of ILEX in which, immediately after such transaction,
the shareholders of ILEX immediately prior to such transaction hold,
directly or indirectly, less than 50% of the equity securities of the
resulting combined company, measured either by number of shares and
other rating securities or by number of votes entitled to be cast.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first set forth above.
ILEX ONCOLOGY, INC. PARALEX, INC.
By: /s/ Xxxxxxx Xxxx By: /s/ Xxxx Xxxxxx
------------------------------- -------------------------------
Printed Name: Xxxxxxx L Love Printed Name: Xxxx X. Xxxxxx
Title: President & CEO Title:
---------------------------- ----------------------------
LICENSE AND OPTION AGREEMENT 12/20/2001
SCHEDULE 1.1
SCHEDULE 1.9
