LICENSE AGREEMENT
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*Certain
confidential information contained in this document, marked by brackets,
has been omitted and filed with the Securities and Exchange Commission
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.
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This
License Agreement (“Agreement”)
is
made by and between The Trustees of the University of Pennsylvania, a
Pennsylvania nonprofit corporation, with offices located at 0000 Xxxxxxxx
Xxxxxx, Xxxxx 000, Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000-0000 (“Penn”)
and
Targeted Genetics Corporation, a corporation organized and existing under the
laws of Washington (“Targeted”),
having a place of business at 0000 Xxxxx Xxx, Xxxxx 000, Xxxxxxx, Xxxxxxxxxx
00000.
Subject
to Section 12.11, this Agreement is effective as of the 1st day of June, 2002
(“Effective
Date”).
RECITALS
WHEREAS,
Genovo, Inc., a corporation organized and existing under the laws of Delaware
(“Genovo”),
having a place of business at 000 Xxxxxxx Xxxxxx, Xxxxxx Xxxx, XX 00000 and
Penn
are parties to the following three agreements, each dated as of June 30, 1995,
and each as amended through the Effective Date (collectively sometimes called
the “Existing
Agreements”):
that
certain Sponsored Research Agreement, pursuant to which Genovo funded certain
research at Penn relating to new strategies for gene therapy (“Sponsored
Research Agreement”);
that
certain License Agreement Lung and Liver Fields pursuant to which Penn has
granted certain licenses and other rights to Genovo relating to certain liver
and lung fields (“Liver/Lung
License”);
and
that certain License Agreement Additional Fields pursuant to which Penn has
granted certain licenses and other rights to Genovo relating to certain other
fields (“Additional
Fields License”);
and
WHEREAS,
the Sponsored Research Agreement has now been terminated in accordance with
that
certain letter agreement between the parties dated February 27, 2001;
and
WHEREAS,
Penn owns and is a proprietor of certain intellectual property, including items
developed under the Sponsored Research Agreement and items discovered or
developed prior thereto and agreed to be subject to one or more of the Existing
Agreements; and
WHEREAS,
Genovo has become an Affiliate of Targeted in a transaction in which former
shareholders of Genovo have become shareholders of Targeted; and
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WHEREAS,
Genovo and Targeted intend to pursue further research directed toward the
development and improvement of gene therapy products and potential
commercialization thereof in one or more applications, and Penn desires that
they do so; and
WHEREAS,
Penn has determined that the exploitation of such intellectual property and
improvements thereto as described herein is in the best interests of Penn,
is
consistent with its educational and research missions and goals, and is likely
to facilitate the accomplishment of the goals that originally supported the
Existing Agreements; and
WHEREAS,
The Wistar Institute of Anatomy and Biology (“Wistar”)
is the
joint owner with Penn of the United States patents and related pending
applications and foreign counterparts thereof listed in Attachment 1
(specifically, Penn docket H1255, hereafter the “Penn/Wistar
Patents”);
and
WHEREAS,
Penn may, with Wistar’s written approval, enter into binding agreements for the
granting of licenses with respect to the Penn/Wistar Patent Application;
NOW,
THEREFORE, in consideration of the premises and of the promises and covenants
contained herein and intending to be legally bound hereby, the parties agree
as
follows:
ARTICLE
1 - DEFINITIONS
For
the
purposes of this Agreement, in addition to the other terms defined above or
elsewhere in this Agreement, the following words and phrases shall have the
meanings set forth herein.
1.1 “[*],”
as
to
a product (and as to the point in time when this definition is referenced in
this Agreement as to such product), means that such product [*]
achieved
the milestone in [*]
and has
since the achievement of such milestone progressed as applicable [*]
set
forth below:
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(a)
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[*]
on
such product with the appropriate health regulatory authority(ies)
in at
least one Major Nation, and Targeted, a Covered Affiliate, or their
collaborators or sublicensees [*];
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(b)
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[*]
clinical trials of such product have been [*]
within [*]
year [*]
for such product [*],
and Targeted, a Covered Affiliate, or their collaborators or sublicensees
exert commercially reasonable efforts to conduct and complete [*];
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(c)
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where
[*]
trials were [*]
for such product, [*]
clinical trials of such product have been [*]
within [*]
years after the [*]
of
such [*]
clinical trials, and Targeted, a Covered Affiliate, or their collaborators
or sublicensees exert commercially reasonable efforts to conduct
and
complete such [*]
trials of such product, including the [*];
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*Confidential
Treatment Requested.
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(d)
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[*]
clinical trials of such product have been [*]
within [*]
years after the [*]
(or [*]
years after the [*]
where [*]
trials were [*]
for such product) clinical trials for such product, and Targeted,
a
Covered Affiliate, or their collaborators or sublicensees exert
commercially reasonable efforts to conduct and complete such [*]
clinical trials of such product, including the [*]
;
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(e)
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[*]
for such product has been [*]
with the appropriate health regulatory authority(ies) in at least
one
Major Nation within [*]
years after the [*]
for such product, and Targeted, a Covered Affiliate, or their
collaborators or sublicensees exert commercially reasonable efforts
to
[*]
of
such [*]
until at least one such [*]
or
until all [*]
(it being understood that the product will no longer be in [*]
if
all such [*]
in
all Major Nations have been [*];
and
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(f)
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such
product [*]
in
at least one Major Nation within [*]
such product by the appropriate health regulatory authority(ies)
in that
Major Nation (including [*]
in
such Major Nation);
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provided,
however, that (1) if Targeted [*]
(even
if, in Targeted’s [*],
it is
prudent for Targeted to do so), Targeted will not be considered to be exerting
commercially reasonable efforts as to the conduct of such clinical trial; (2)
the time periods specified in this Section as applied to a product shall be
tolled during any period or periods in which Targeted is, beyond its reasonable
control, prevented from developing such product by government-imposed
moratoriums, laws or rulings that prevent others generally from developing
similar products, it being understood that if a clinical trial is halted or
suspended because of [*]
to
Targeted’s conduct of the trial, such action will not toll the time periods
specified in this Section as applied to the product involved in such
trial;
and (3)
if at any time or times Targeted believes that it may not be able to advance
a
particular product through one or more of the above stages of development within
any of the specific time periods specified in this Section (whether or not
due
to factors described in clause (2) above), it may so notify Penn, together
with
a reasonably detailed description of the factors or reasons why Targeted
believes it should nevertheless continue to be considered to have such product
under [*] whereupon
Penn and Targeted will over a period of at least [*]
to reach
agreement on extension(s) to such time period(s) as shall be reasonable in
the
circumstances.
1.2 “Affiliate”
of
an
entity means and includes the entities that, directly or indirectly, own or
control more than 50% of the voting interests (or equivalent control) of such
entity (“Parent”),
or
more than 50% of the voting interests (or equivalent control) of which is,
directly or indirectly, owned or controlled by such entity or its Parent.
“Affiliated”
refers
to Affiliates. “Covered
Affiliate”
refers
to an affiliate of Targeted that has agreed in writing to be bound by Targeted’s
rights and obligations under this Agreement; Penn acknowledges that Genovo,
by
its signature agreeing to be bound by all the terms and obligations of Targeted
below, is a Covered Affiliate.
*Confidential
Treatment Requested.
-3-
1.3 “Bankruptcy
Event”
means
voluntary or involuntary proceedings by or against Targeted are instituted
in
bankruptcy or under any insolvency law, or a receiver or custodian is appointed
for Targeted, or proceedings are instituted by or against Targeted for corporate
reorganization or the dissolution of Targeted, which proceedings, if
involuntary, shall not have been dismissed within sixty (60) days after the
date
of filing, or Targeted makes an assignment for the benefit of creditors, or
substantially all of the assets of Targeted are seized or attached and not
released within sixty (60) days thereafter.
1.4 “[*]”
includes [*].
1.5 “Calendar
Quarter”
means
each three-month period, or any portion thereof, beginning on January 1, April
1, July 1 and October 1.
1.6 “Calendar
Year”
means
a
period of twelve (12) months beginning on January 1 and ending on December
31.
1.7 “[*]
Field”
means
the prevention, treatment or cure of [*]
whether
by in
vivo
or
ex
vivo
means
(together with preparation, research, development, and attempts to do the
foregoing).
1.8 “Confidential
Information”
means
and includes all technical information, inventions, developments, discoveries,
software, know-how, methods, techniques, formulae, data, processes and other
proprietary ideas, whether or not patentable or copyrightable, that Penn
identifies as confidential or proprietary at the time it is delivered or
communicated to Targeted.
1.9 "[*]"
means,
with respect to a Penn Licensed Product: (a) the [*]
(or its
equivalent) filed on such Penn Licensed Product in any Major Nation; and (b)
up
to [*]
additional [*]
each of
which is [*],
and for
which [*]
within
the next [*]
years
for a Penn Licensed Product incorporating the same [*]
as such
Penn Licensed Product and/or [*]
of up to
[*]
additional [*]
in such
Penn Licensed Product. Targeted shall designate the additional [*]
and
additional [*]
referred
to in clause (b) within [*]
following the [*]
on such
Penn Licensed Product in any Major Nation; provided, however, that as to Penn
Licensed Products covered by Group 2 Patents, Targeted may designate such
additional [*]
and
additional [*]
at an
earlier time as described in Section 4.2.3. If, within such [*]
following the [*]
or
equivalent referred to in clause (a), none of Targeted or its Affiliates or
licensees has actually [*]
or
equivalent in at least one Major Nation for a Penn Licensed Product directed
to
a [*]
that was
so designated, then that [*]
shall
from that time forward no longer be among the [*]
with
respect to the Penn Licensed Product that was the subject [*]
referred
to in clause (a).
*Confidential
Treatment Requested.
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1.10
“Fair
Market Value”
means:
1.10.1 in
the
case of a Sale, the cash consideration which Targeted or its Covered Affiliate
or sublicensee would realize from an unaffiliated, unrelated buyer under no
obligation to buy in an arm’s length sale of an identical item sold in the same
quantity and at the same time and place of the transaction; or
1.10.2 in
the
case of a transaction other than a Sale, the cash consideration which a willing
party would realize from an unaffiliated, unrelated third party under no
obligation to transact in an arm’s length transaction of the same type and at
the same time and place of transaction; provided, however, that where Sales
or
other transactions are made in connection with patient assistance programs
or
other charitable purposes or to physicians or hospitals for promotional
purposes, “Fair Market Value” for purposes hereof shall mean the actual
consideration received, if any.
1.11
“Federal
Government Interest”
means
the rights of the United States Government under Public Laws 96-517, 97-256
and
98-620, codified at 35 U.S.C. 200-212, and any regulations issued thereunder,
as
such statute or regulations may be amended from time to time
hereafter.
1.12 “[*]”
means
[*].
1.13
“[*]
Letter Agreement”
means
that certain letter agreement among [*]
dated as
of August 27, 1999, as amended through the Effective Date.
1.14 “[*]
Field”
means
the prevention, treatment, or cure of [*]
whether
by in
vivo or
ex
vivo
means
(together with preparation, research, development, and attempts to do the
foregoing).
1.15 “Major
Nation(s)”
means
any one or more of Canada, France, Germany, Japan, the United Kingdom, or the
United States. It is agreed for the avoidance of doubt that any filings or
other
actions or proceedings with or in the European Agency for the Evaluation of
Medicinal Products or its successor will be considered to be with or in the
health regulatory agency in at least one Major Nation.
1.16 “Net
Sales”
means
the gross sales amounts or, if such consideration is in a form other than cash
or cash equivalents, the Fair Market Value, received by Targeted or its Covered
Affiliates or their sublicensees from the Sale of any Penn Licensed Product(s),
less qualifying costs directly attributable to such Sale borne by Targeted,
its
Covered Affiliate or their sublicensees. Such qualifying costs shall be limited
to the following:
1.16.1 Discounts,
in amounts customary in the trade, for quantity purchases, prompt payments
and
for wholesalers and distributors;
*Confidential
Treatment Requested.
-5-
1.16.2 Credits
or refunds, not exceeding the original invoice amount, for claims or
returns;
1.16.3 Prepaid
outbound packing, transportation expenses and transportation insurance
premiums;
1.16.4 Sales
and
use taxes and other fees imposed by a governmental agency; and
1.16.5 Retroactive
price reductions or rebates as required by law,
all
in
accordance with U.S. generally accepted accounting principles consistently
applied.
1.17 “Non-Targeted
Party”
means
any person or entity that is not Penn, Targeted, an Affiliate of Penn, a Covered
Affiliate, a sublicensee of Targeted or of a Covered Affiliate (which term
refers to persons or entities to the extent acting under an express sublicense
of rights of Targeted or a Covered Affiliate under this Agreement), or another
collaborator or distributor of Targeted, a Covered Affiliate, or their
sublicensees.
1.18 “Penn
Licensed Product(s)”
means
1.18.1
products
that in the absence of this Agreement would, where and when made, used, sold,
or
imported, infringe at least one issued claim or pending claim of Penn Patent
Rights; and
1.18.2
products
that are made using a process or machine that in the absence of this Agreement
would, where and when used, infringe at least one issued claim or pending claim
of Penn Patent Rights.
All
Penn
Licensed Products intended to [*]
shall be
considered [*]
Penn
Licensed Product for purposes of Sections 4.1 and 4.3.
1.19 “[*]”
means
[*].
1.20 “Penn
Patent Rights”
means
those patents and patent applications listed in Attachment 1 to this Agreement
and all foreign counterparts thereof, as well as continuation,
continuation-in-part, provided that such continuation-in-part relates directly
to existing patents or patent applications and not to any new matter, divisional
and re-issue applications thereof, together with any and all patents issuing
thereupon or upon any foreign counterparts thereof; provided, however, that
Targeted and Genovo acknowledge that the invention relating to [*],
was
made at Penn following [*].
Targeted and Genovo hereby acknowledge that they have no rights in this
invention relating to [*],
as
defined in these applications and divisionals, continuations, re-examinations,
re-issues, and any foreign counterparts thereof, and any patents issuing
therefrom. Targeted and Genovo agree that they will not make or pursue any
claims that this invention as so defined is or should have been part of the
Penn
Patent Rights.
*Confidential
Treatment Requested.
-6-
1.20.1 “Group
1 Patents”
means
those Penn Patent Rights that are so designated in Attachment 1.
1.20.2 “Group
2 Patents”
means
those Penn Patent Rights that are so designated in Attachment 1.
1.20.3 “Group
3 Patents”
means
those Penn Patent Rights that are so Designated in Attachment 1.
1.20.4 “Group
4 Patents”
means
those Penn Patent Rights that are so designated in Attachment 1.
1.20.5 “Group
5 Patents”
means
those Penn Patent Rights that are so designated in Attachment 1.
1.21 “Penn
Technical Information”
means
research and development information, unpatented inventions, know-how, and
technical data developed by Dr. Xxxxx Xxxxxx, or other employees of Penn with
a
duty to assign their rights to Penn, under the Sponsored Research Agreement
designated in Attachment 2 or described in the Penn Patent Rights, and not
otherwise covered by Penn Patent Rights.
1.22 “Phase
I Trials”
“Phase
II Trials”
and
“Phase
III Trials”
mean,
respectively, human clinical trials designated by the U.S. Food and Drug
Administration (FDA) as Phase I, Phase II (or Phase I/II), or Phase III
trials.
1.23 “Sale”
means
any bona fide transaction for which consideration is received or expected for
the sale, use, lease, transfer, or other disposition of Penn Licensed
Product(s); provided, however, that the sale, lease, transfer, or other
disposition of any Penn Licensed Product between Targeted, its Covered
Affiliates, or their sublicensees, and another entity in such group, other
than
to a non-Covered-Affiliate distributor or to an end user, shall not be
considered a Sale. In such cases, “Net Sales” hereunder shall be determined
using the invoiced or otherwise recognized sales price by the transferee party,
Covered Affiliate, or sublicensee to the non-Covered-Affiliate distributor
or
the end user, less the qualifying costs allowed under Section 1.16. A Sale
of
Penn Licensed Product(s) shall be deemed completed at the time Targeted, its
Covered Affiliate or their sublicensee invoices, ships, or receives payment
for
such Penn Licensed Product(s), whichever occurs first. Sale shall not include
any use of Penn Licensed Products in preclinical work, clinical trials, or
internal research by Targeted, its Covered Affiliates, or their sublicensees
or
other collaborators, distributors, or contractors, or [*].
*Confidential
Treatment Requested.
-7-
1.24 “Senior
Officer(s)”
means,
as to Targeted at any relevant time, the then-incumbent Chief Executive Officer
of Targeted, and as to Penn at any relevant time, the Managing Director, Center
for Technology Transfer.
1.25 “[*]
Field”
means
the prevention, treatment, or cure of any disease or diseases in whole or in
part through [*],
whether
by in
vivo or
ex
vivo
means
(together with preparation, research, development, and attempts to do the
foregoing). For purposes hereof, the [*]
are more
fully described in Attachment 3.
ARTICLE
2 - LICENSE GRANTS
AND DILIGENCE
2.1 Group
1 Patents.
2.1.1 Group
1 License Grant.
Penn
hereby grants to Targeted and the Covered Affiliates for the term of this
Agreement the worldwide right and license, with the right to grant sublicenses,
to develop, have developed, make, have made, use, have used, import, have
imported, sell, offer for sale and have sold Penn Licensed Products under the
Group 1 Patents [*]
to
Targeted.
2.1.2 Group
1 Diligence Outside the [*]
Field
and the [*]
Field.
Penn
shall have the right, at its option, to [*]
the
right and license under this Section 2.1 from [*]
outside
of the [*]
Field
and also outside of the [*]
Field,
if Targeted [*]
of the
following conditions, provided that, except as to the condition stated in clause
(e) below, Penn exercises such right by written notice to Targeted within
[*]
after
Penn's receipt of Targeted's Development Plan for the period in which such
condition was due, or receipt of explicit written notice from Targeted, in
response to Penn's written inquiry, that such condition has not been satisfied,
whichever occurs first, and that Penn gives Targeted at least [*]
prior
notice of Penn’s intention to exercise such right:
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(a)
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Targeted
and its Affiliates and sublicensees [*]
covered by the Group 1 Patents prior to the end of the [*];
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| (b) |
Targeted
and its Affiliates and sublicensees [*]
at
any time after the [*]
anniversary of the Effective Date, to have [*]
trials utilizing and exercising commercially reasonable progress
toward
[*],
without [*],
for at least [*]
under the Group 1 Patents for use outside of both the [*]
Field and the [*]
Field;
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| (c) |
Targeted
and its Affiliates and sublicensees [*]
at
any time after the [*]
anniversary of the Effective Date, to have [*]
trials utilizing and exercising commercially reasonable progress
toward
[*],
without [*],
for at least [*]
under the Group 1 Patents for use outside of both the [*]
Field and the [*]
Field;
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*Confidential
Treatment Requested.
-8-
| (d) |
Targeted
and its Affiliates and sublicensees [*],
at any time after the [*]
anniversary of the Effective Date, to have [*]
trials utilizing and exercising commercially reasonable progress
toward
[*],
without [*],
for at least [*]
under the Group 1 Patents for use outside of both the [*]
Field and the [*]
Field; or
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| (e) |
Targeted,
its Affiliates, and sublicensees [*],
at any time after the [*]
anniversary of the Effective Date, to have [*]
at
least [*]
under the Group 1 Patents for use outside of both the [*]
Field and the [*]
Field.
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2.1.3 Group
1 Specific-[*]
Sublicenses after Year [*].
[*],
Targeted shall make non-exclusive, commercial-use [*]
under
the Group 1 Patents available to third parties on commercially reasonable terms,
provided that (unless Targeted [*]
in its
discretion): (a) each such sublicense is restricted to [*];
(b)
such [*]
is(are)
not the subject of any sublicense previously granted by Targeted or its
Affiliates on an exclusive basis, nor is any such exclusive sublicense with
respect to such [*]
then in
active negotiation; (c) such sublicense does not permit use in or application
to
the [*]
Field or
in or to the [*]
Field or
in or to the [*]
Field;
and (d) such sublicense does not permit use or application to any product in
an
[*]
applicable to any Penn Licensed Product that is then in [*]
by
Targeted, its Affiliates or their licensees. Where Targeted has [*]
for such
a sublicense and [*]
within
[*]
thereafter, Targeted shall either inform Penn [*],
together with a statement of the terms on which [*],
or else
Targeted shall [*],
then
Penn shall have the right to [*],
provided that [*]
under
clauses (a) - (d) above (reading references to [*]
to refer
[*],
and
recognizing that Penn will [*]
criteria
under clauses (b) and (d) [*]
with
relevant information with respect thereto), and [*].
2.1.4 Group
1 Diligence in the [*]
Field.
Penn
shall have the right, at its option, to [*]
the
right and license under this Section 2.1 [*]
in the
[*]
Field if
Targeted and its Affiliates and sublicensees [*],
at any
time after the [*]
anniversary of the Effective Date, to have [*]
at least
[*]
under
the Group 1 Patents for use in the [*]
Field,
provided that Penn gives Targeted at [*]
prior
notice of Penn’s intention to exercise such right.
2.1.5 Group
1 Diligence in the [*]
Field.
Penn
shall have the right, at its option, to [*]
the
right and license under this Section 2.1 [*]
in the
[*]
Field if
Targeted and its Affiliates and sublicensees [*],
at any
time after the [*]
anniversary of the Effective Date, to have [*]
at least
[*]
under
the Group 1 Patents for use in the [*]
Field,
provided that Penn gives Targeted at least [*]
prior
notice of Penn’s intention to exercise such right.
2.2 Group
2 Patents.
2.2.1 Group
2 License Grant.
Penn
hereby grants to Targeted and the Covered Affiliates for the term of this
Agreement the worldwide right and license, with the right to grant sublicenses,
to develop, have developed, make, have made, use, have used, import, have
imported, sell, offer for sale and have sold Penn Licensed Products under the
Group 2 Patents [*].
*Confidential
Treatment Requested.
-9-
2.2.2 Group
2 Licenses to [*].
Penn
retains the right to license [*]
(“[*]”)
non-exclusively to develop, have developed, make, have made, use, have used,
import, have imported, sell, offer for sale and have sold Penn Licensed Products
under the Group 2 Patents solely [*]
Field,
and solely in conjunction with [*]’s
proprietary [*]
technology that exists as of the Effective Date, including any improvements
and
modifications thereof, (currently referred to as [*]’s
“[*]”
and
“[*]”
technologies, including any modifications and improvements of the foregoing,
and
inclusive of subsequent improvements thereto, provided that the technology
remains a [*]
operably
linked to some [*]
proprietary [*]
technology) and that is substantial and necessary to be used for such
development, making, use, importation or sale of such Penn Licensed Products;
provided, however, that:
| (a) |
[*]
may be permitted to grant sublicenses under such license, provided
that
the sublicensee is similarly bound to use such Penn Licensed Patents
solely in conjunction with such [*]
proprietary [*]
technology; and
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| (b) |
Notwithstanding
the foregoing in any transaction or transactions between [*]
or
its sublicensees on the one hand and either Targeted or [*]
on
the other, in any such transaction(s), rights to the Group 2 Patents
will
be obtained from Targeted based upon its rights under this Agreement
and/or [*]
based upon its sublicense from
Targeted.
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2.2.3 Group
2 Specified [*]
Sublicenses in Years [*].
[*],
Targeted shall make non-exclusive, commercial-use [*]
under
the Group 2 Patents available to third parties on commercially reasonable terms,
provided that (unless Targeted [*]
in its
discretion): (a) each such sublicense is restricted to [*];
(b)
neither such [*],
nor the
delivery thereof, are at the time such sublicense is sought or under negotiation
the subject of any on-going research, development, regulatory or commercial
project at Targeted or its Affiliates in which at least one of the [*]
has been
[*];
(c)
such [*]
is(are)
not the subject of any sublicense previously granted by Targeted or its
Affiliates on an exclusive basis, nor is any such exclusive sublicense with
respect to such [*]
then in
active negotiation; (d) such third party or its Affiliate is then actively
funding substantial and on-going research at Penn in the Institute for Human
Gene Therapy; (e) such sublicense does not permit use in or application to
the
[*]
Field or
in or to the [*]
Field or
in or to the [*]
Field;
and (f) such sublicense does not permit use or application to an [*]
applicable to any Penn Licensed Product that is then either in [*]
by
Targeted or its Affiliates or that is otherwise then the subject of any on-going
research, development, regulatory or commercial project at Targeted, its
Affiliates or their licensees in which at least [*]
and as
to which the [*]
have
been determined pursuant to Section 1.9 or Section 4.2.3. Where Targeted has
[*]
for such
a sublicense and [*]
within
[*]
thereafter, Targeted shall either inform Penn of [*],
together with a statement of the terms on which [*],
or else
Targeted shall [*],
then
Penn shall have the right to [*],
provided that [*]
under
clauses (a) - (f) above (reading references to [*]
to refer
[*],
and
recognizing that Penn will [*].
*Confidential
Treatment Requested.
-10-
2.2.4 Group
2 Specified [*]
Sublicenses after [*].
[*],
Targeted shall make non-exclusive, commercial-use [*]
under
the Group 2 Patents available to third parties on commercially reasonable terms,
provided that (unless Targeted [*]
in its
discretion): (a) each such sublicense is restricted to [*]
identified in such sublicense; (b) such [*]
is(are)
not the subject of any sublicense previously granted by Targeted or its
Affiliates on an exclusive basis, nor is any such exclusive sublicense with
respect to such [*]
then in
active negotiation; (c) such sublicense does not permit use in or application
to
the [*]
Field or
in or to the [*]
Field or
in or to the [*]
Field;
and (d) such sublicense does not permit use or application to an [*]
applicable to any Penn Licensed Product that is then in [*]
by
Targeted, its Affiliates or their licensees. Where Targeted has [*]
and
[*]
within
[*]
thereafter, Targeted shall either inform Penn [*],
together with a statement of the terms on which [*],
or else
Targeted shall [*]
then
Penn shall have the right to [*],
provided that [*]
under
clauses (a) - (d) above (reading references to [*]
to refer
[*]
and
recognizing that Penn will [*].
2.2.5 Group
2 Diligence outside the [*]
Field
and the [*]
Field.
Penn
shall have the right, at its option, to [*]
the
right and license under this Section 2.2 [*]
outside
of the [*]
Field
and also outside of the [*]
Field,
if Targeted and its Affiliates and sublicensees [*],
at any
time after the [*]
anniversary of the Effective Date, to have [*]
at least
[*]
under
the Group 2 Patents for use outside of both the [*]
Field
and the [*]
Field,
provided that Penn gives Targeted at least [*]
prior
notice of Penn’s intention to exercise such right. Targeted shall have the
right, at its option and by notice to Penn given at any time on or before the
[*]
anniversary of the Effective Date, to [*]
the
right and license under this Section 2.2 (or with respect to one or more of
the
Penn Patent Rights included in Group 2) [*]
outside
the [*]
Field
and the [*]
Field
from the date of such notice forward.
2.2.6 Group
2 Diligence in the [*]
Field.
Penn
shall have the right, at its option, to [*]
the
right and license under this Section 2.2 [*]
in the
[*]
Field if
Targeted and its Affiliates and sublicensees [*],
at any
time after the [*]
anniversary of the Effective Date, to have [*]
at least
[*]
under
the Group 2 Patents for use in the [*]
Field,
provided that Penn gives Targeted at least [*]
prior
notice of Penn’s intention to exercise such right. Targeted shall have the
right, at its option and by notice to Penn given at any time on or before the
[*]
anniversary of the Effective Date, to [*]
the
right and license under this Section 2.2 (or with respect to one or more of
the
Penn Patent Rights included in Group 2) [*]
in the
[*]
Field
from the date of such notice forward.
*Confidential
Treatment Requested.
-11-
2.3 Group
3 Patents.
2.3.1 Group
3 License Grant.
Penn
hereby grants to Targeted and the Covered Affiliates for the term of this
Agreement the worldwide right and license, with the right to grant sublicenses,
to develop, have developed, make, have made, use, have used, import, have
imported, sell, offer for sale and have sold Penn Licensed Products under the
Group 3 Patents in [*].
2.3.2 Group
3 Specified [*]
Sublicenses after Year [*].
[*],
Targeted shall make non-exclusive, commercial-use [*]
under
the Group 3 Patents available to third parties on commercially reasonable terms,
provided that (unless Targeted [*]in
its
discretion): (a) each such sublicense is restricted to [*]
identified in such sublicense; (b) such [*]
is(are)
not the subject of any sublicense previously granted by Targeted or its
Affiliates on an exclusive basis, nor is any such exclusive sublicense with
respect to such [*]
then in
active negotiation; (c) such sublicense does not permit use in or application
to
the [*]
Field or
in or to the [*]
Field or
in or to the [*]
Field;
and (d) such sublicense does not permit use or application to any product in
an
[*]
applicable to any Penn Licensed Product that is then in [*]
by
Targeted, its Affiliates or their licensees. Where Targeted has [*]
and
[*]
within
[*]
thereafter, Targeted shall either inform Penn [*],
together with a statement of the terms on which [*],
or else
Targeted shall [*]
under
the Group 3 Patents, provided that [*]
under
clauses (a) - (d) above (reading references therein to [*]
to refer
[*]
and
recognizing that Penn will [*]).
2.3.3 Group
3 Diligence outside the [*]
Field
and the [*]
Field.
Penn
shall have the right, at its option, to [*]
the
right and license under this Section 2.3 [*]
outside
of the [*]
Field
and also outside of the [*]
Field,
if Targeted and its Affiliates and sublicensees [*],
at any
time after the [*]
anniversary of the Effective Date, to have [*]
at least
[*]
under
the Group 3 Patents for use outside of both the [*]
Field
and the [*]
Field,
provided that Penn gives Targeted at least [*]
prior
notice of Penn’s intention to exercise such right. Targeted shall have the
right, at its option and by notice to Penn given at any time on or before the
[*]
anniversary of the Effective Date, to [*]
the
right and license under this Section 2.3 (or with respect to one or more of
the
Penn Patent Rights included in Group 3) [*]
outside
the [*]
Field
and the [*]
Field
from the date of such notice forward.
2.3.4 Group
3 Diligence in the [*]
Field.
Penn
shall have the right, at its option, to [*]
the
right and license under this Section 2.3 [*]
in the
[*]
Field if
Targeted and its Affiliates and sublicensees [*],
at any
time after the [*]
anniversary of the Effective Date, to have [*]
at least
[*]
under
the Group 3 Patents for use in the [*]
Field,
provided that Penn gives Targeted at least [*]
prior
notice of Penn’s intention to exercise such right. Targeted shall have the
right, at its option and by notice to Penn given at any time on or before the
[*]
anniversary of the Effective Date, to [*]
the
right and license under this Section 2.3 (or with respect to one or more of
the
Penn Patent Rights included in Group 3) [*]
in the
[*]
Field
from the date of such notice forward.
*Confidential
Treatment Requested.
-12-
2.3.5 Group
3 Diligence in the [*]
Field.
Penn
shall have the right, at its option, to [*]
the
right and license under this Section 2.3 [*]
in the
[*]
Field if
Targeted and its Affiliates and sublicensees [*],
at any
time after the [*]
anniversary of the Effective Date, to have [*]
at least
[*]
under
the Group 3 Patents for use in the [*]
Field,
provided that Penn gives Targeted at least [*]
prior
notice of Penn’s intention to exercise such right. Targeted shall have the
right, at its option and by notice to Penn given at any time on or before the
[*]
anniversary of the Effective Date, to [*]
the
right and license under this Section 2.3 (or with respect to one or more of
the
Penn Patent Rights included in Group 3) [*]
in the
[*]
Field
from the date of such notice forward.
2.4 Group
4 Patents.
2.4.1 Group
4 License Grant.
Penn
hereby grants to Targeted and the Covered Affiliates for the term of this
Agreement the worldwide right and license, with the right to grant sublicenses,
to develop, have developed, make, have made, use, have used, import, have
imported, sell, offer for sale and have sold Penn Licensed Products under the
Group 4 Patents [*].
2.4.2 Group
4 Diligence in the [*]
Field.
Penn
shall have the right, at its option, to [*]
the
right and license under this Section 2.4 [*]
in the
[*]
Field if
Targeted and its Affiliates and sublicensees [*],
at any
time after the [*]
anniversary of the Effective Date, to have [*]
at least
[*]
under
the Group 4 Patents for use in the [*]
Field,
provided that Penn gives Targeted at least [*]
prior
notice of Penn’s intention to exercise such right. Targeted shall have the
right, at its option and by notice to Penn given at any time on or before the
[*]
anniversary of the Effective Date, to [*]
the
right and license under this Section 2.4 (or with respect to one or more of
the
Penn Patent Rights included in Group 4) [*]
in the
[*]
Field
from the date of such notice forward.
2.4.3 Group
4 Diligence in the [*]
Field.
Penn
shall have the right, at its option, to [*]
the
right and license under this Section 2.4 [*]
in the
[*]
Field if
Targeted and its Affiliates and sublicensees [*],
at any
time after the [*]
anniversary of the Effective Date, to have [*]
at least
[*]
under
the Group 4 Patents for use in the [*]
Field,
provided that Penn gives Targeted at least [*]
prior
notice of Penn’s intention to exercise such right. Targeted shall have the
right, at its option and by notice to Penn given at any time on or before the
[*]
anniversary of the Effective Date, to [*]
the
right and license under this Section 2.4 (or with respect to one or more of
the
Penn Patent Rights included in Group 4) [*]
in the
[*]
Field
from the date of such notice forward.
2.5 Group
5 Patents.
2.5.1 Group
5 License Grant.
Penn
hereby grants to Targeted and the Covered Affiliates for the term of this
Agreement the worldwide right and license, with the right to grant sublicenses,
to develop, have developed, make, have made, use, have used, import, have
imported, sell, offer for sale and have sold Penn Licensed Products under the
Group 5 Patents [*].
*Confidential
Treatment Requested.
-13-
2.5.2 Group
5 Diligence in the [*]
Field.
Penn
shall have the right, at its option, to [*]
the
right and license under this Section 2.5 [*]
in the
[*]
Field if
Targeted and its Affiliates and sublicensees [*],
at any
time after the [*]
anniversary of the Effective Date, to have [*]
at least
[*]
under
the Group 5 Patents for use in the [*]
Field,
provided that Penn gives Targeted at least [*]
prior
notice of Penn’s intention to exercise such right. Targeted shall have the
right, at its option and by notice to Penn given at any time on or before the
[*]
anniversary of the Effective Date, to [*]
the
right and license under this Section 2.5 (or with respect to one or more of
the
Penn Patent Rights included in Group 5) [*]
in
[*]
Field
from the date of such notice forward.
2.5.3 Group
5 Diligence in the [*]
Field.
Penn
shall have the right, at its option, to [*]
the
right and license under this Section 2.5 [*]
in the
[*]
Field if
Targeted and its Affiliates and sublicensees [*],
at any
time after the [*]
anniversary of the Effective Date, to have [*]
at least
[*]
under
the Group 5 Patents for use in the [*]
Field,
provided that Penn gives Targeted at least [*]
prior
notice of Penn’s intention to exercise such right. Targeted shall have the
right, at its option and by notice to Penn given at any time on or before the
[*]
anniversary of the Effective Date, to [*]
the
right and license under this Section 2.5 (or with respect to one or more of
the
Penn Patent Rights included in Group 5) [*]
in
[*]
Field
from the date of such notice forward.
2.6 No
Implied Diligence.
Targeted’s diligence obligations with respect to this Agreement and the licenses
granted hereunder are as explicitly stated in this Article 2, and no other
or
additional diligence or efforts obligations are implied, nor shall any be
inferred.
2.7 Retained
Research Rights.
For all
exclusive licenses granted under this Article 2: (i) Penn retains the reserved
right to use, and to permit other for-profit or nonprofit organizations to
use,
the Penn Patent Rights strictly for educational and for research purposes and
to
use or commercialize the results thereof, provided that any and all such
commercialization of results, if not otherwise sublicensed by Targeted in its
sole discretion and without obligation to do so, may be done, and is done,
without any further use of or commercialization of any of the Penn Patent Rights
within the scope of any exclusive rights of Targeted or the Covered Affiliates
hereunder, and that such restriction is incorporated into a written agreement
with such organization; and (ii) Wistar retains the reserved right to use and
permit other for-profit or nonprofit organizations to use the Penn/Wistar Patent
strictly for educational and research purposes and to use or commercialize
the
results thereof, provided that any and all such commercialization of results,
if
not otherwise sublicensed by Targeted in its sole discretion and without
obligation to do so, may be done, and is done, without any further use of or
commercialization of any of the Penn Patent Rights within the scope of any
exclusive rights of Targeted or the Covered Affiliates hereunder, and that
such
restriction is incorporated into a written agreement with such organization.
*Confidential
Treatment Requested.
-14-
2.8 Government
Interest.
Targeted acknowledges that in accordance with the Federal Government Interest,
the United States government retains certain rights in intellectual property
funded in whole or part under any contract, grant or similar agreement with
a
Federal agency, including but not limited to the requirement that Penn Licensed
Products subject to Sale in the United States must be substantially manufactured
in the United States. The license grant of this Article 2 is expressly subject
to all of such rights.
2.9 Penn
Technical Information.
Penn,
to the extent it has rights in the Penn Technical Information, hereby
irrevocably grants Targeted and the Covered Affiliates a non-exclusive,
royalty-free, paid-up right and license, without right to sublicense, to make,
use, sell, import, reproduce, disclose and otherwise exploit the same during
and
after the term of this Agreement.
2.10 No
Implied Licenses.
No
other rights or licenses are granted by implication hereunder. Targeted
acknowledges that Penn shall have the right, in its sole discretion and without
obligation to Targeted, to grant other parties licenses under the Penn Patent
Rights so long as the same do not conflict with, and are not within the scope
of, any of the exclusive rights or licenses granted hereunder to Targeted and
the Covered Affiliates.
ARTICLE
3 - SUBLICENSES
3.1 The
right
to sublicense conferred upon Targeted and the Covered Affiliates under this
Agreement shall be subject to the following conditions:
3.1.1 Any
sublicenses shall be subject to the terms and conditions granted to Targeted
and
the Covered Affiliates under this Agreement.
3.1.2 No
sublicensee (excluding, for this purpose, [*]
under
that certain [*],
among
[*],
as
amended, and [*]
under
the [*]
Letter
Agreement, but including, for this purpose, any sub-sublicensee of [*]
under
such agreement(s)) shall have the power to grant further sublicenses without
the
express approval of Penn, which approval shall not be unreasonably
withheld.
3.1.3 Targeted
shall forward to Penn, within thirty (30) days of execution, a complete and
accurate copy written in the English language of each sublicense granted
hereunder for which Targeted has exclusive rights. Penn’s receipt of such
sublicense shall not constitute an approval of such sublicense or a waiver
of
any of Penn’s rights or Targeted’s obligations hereunder.
3.1.4 Targeted
shall not grant any sublicense under any Penn Patent Rights in fields where
Targeted has non-exclusive license rights hereunder unless:
*Confidential
Treatment Requested.
-15-
|
(a)
|
such
license to Targeted hereunder was initially non-exclusive or became
non-exclusive due to an election by Targeted as provided herein (rather
than due to [*],
and such sublicense is not a [*];
or
|
|
(b)
|
the
conditions in provision (a) apply except that the sublicense is a
[*]
and Targeted has obtained Penn’s prior written approval of such
sublicense, which approval shall not be reasonably withheld or delayed;
or
|
|
(c)
|
if
the license to Targeted [*],
Targeted has obtained Penn’s prior written approval of such
sublicense.
|
3.1.5 If
Targeted becomes subject to a Bankruptcy Event, all payments then or thereafter
due and owing to Targeted from its sublicensees shall upon notice from Penn
to
any such sublicensee become payable directly to Penn for the account of
Targeted; provided however, that Penn shall remit to Targeted the amount by
which such payments exceed the amounts owed by Targeted to Penn.
3.1.6 Notwithstanding
any such sublicense, Targeted shall remain primarily liable to Penn for all
of
Targeted’s duties and obligations contained in this Agreement, and any act or
omission of a Covered Affiliate or sublicensee of Targeted which would be a
breach of this Agreement if performed by Targeted shall be deemed to be a breach
by Targeted of this Agreement.
3.2 Targeted
and Penn acknowledge that (i) for purposes of the [*]
Letter
Agreement, [*]
by this
Agreement, but, rather, shall only have been amended hereby, and (ii)
[*]
shall
not be bound by any amendment or alteration of the Existing Agreements, or
any
of them, to the extent the same may bear on the rights or obligations of
[*]
under
the [*]
Letter
Agreement. Accordingly, Targeted and Penn agree that this Agreement is intended
to be, and shall be construed to be, consistent with the [*]
Letter
Agreement, [*]
Letter
Agreement shall remain in full force and effect.
ARTICLE
4 - ROYALTIES
AND MILESTONES
4.1 Royalties.
4.1.1 In
further consideration of the licenses granted pursuant to Article 2, but subject
to Section 4.1.4, Targeted shall pay to Penn a royalty in accordance with the
following table for the Net Sales received by Targeted, the Covered Affiliates,
or their sublicensees with respect to each particular Penn Licensed Product
that
has been, or that later is, in whole or in part developed by [*]
under a
right or sublicense granted by Targeted or a Covered Affiliate or otherwise
collaboratively by [*]
on the
one hand and by Targeted and/or Covered Affiliates on the other:
*Confidential
Treatment
Requested.
-16-
|
For
the portion of Net Sales of such Penn Licensed Product in a Calendar
Year:
|
The
royalty rate for such Net Sales will be:
|
|
Less
than or equal to [*]
|
[*]
|
|
Greater
than [*]
and less than or equal to [*]
|
[*]
|
|
Greater
than [*]
and less than or equal to [*]
|
[*]
|
|
Greater
than [*]
|
[*]
|
4.1.2 In
further consideration of the licenses granted pursuant to Article 2, but subject
to Section 4.1.4, Targeted shall pay to Penn a royalty in accordance with the
following table for the Net Sales received by Targeted, the Covered Affiliates,
or their sublicensees with respect to each particular Penn Licensed Product
to
which Section 4.1.1 above is not applicable:
|
For
the portion of Net Sales of such Penn Licensed Product in a Calendar
Year:
|
The
royalty rate for such Net Sales will be:
|
|
Less
than or equal to $[*]
|
[*]
|
|
Greater
than $[*]
and less than or equal to $[*]
|
[*]
|
|
Greater
than $[*]
and less than or equal to $[*]
|
[*]
|
|
Greater
than $[*]
|
[*]
|
*Confidential
Treatment
Requested.
-17-
4.1.3 For
purposes of each of Section 4.1.1 and Section 4.1.2: (i) no additional or
multiple royalties shall be payable with respect to the Net Sales of any Penn
Licensed Product, regardless of the number of Penn Patent Rights, or claims
of
Penn Patent Rights, that would in the absence of this Agreement be infringed
by
such Penn Licensed Product or processes or machines used to make it, even if
such Penn Patent Rights include those from more than one of the patent groups
defined in Section 1.20; (ii) the Net Sales thresholds in such sections will
be
[*],
but
where the same Penn Licensed Product is [*],
or
otherwise to accommodate the same to [*],
the Net
Sales thereof in all such nations, markets and indications shall be [*]
for
purposes of Section 4.1.2; and (iii) all Net Sales of any particular Penn
Licensed Product received by any of Targeted, Covered Affiliates, or their
sublicensees will be [*]
for
purposes of Section 4.1.2.
4.1.4 The
royalties otherwise payable under Section 4.1.1 or 4.1.2 shall be [*]
with
respect to the Net Sales of any Penn Licensed Product that, at the time of
its
Sale and in the patent jurisdiction of its Sale, has a competing product also
licensed under the Penn Patent Rights on sale.
4.1.5 Targeted
shall promptly pay to Penn the scheduled percentage, as set forth below, of
any
sublicense initiation fee, or other such consideration not associated with
Sales, paid to Targeted or a Covered Affiliate by each sublicensee that is
not
Targeted or a Covered Affiliate. All such considerations [*]
shall be
exempt. In addition, Targeted shall not be required to [*]
Penn a
percentage of i) [*];
ii)
[*]
or iii)
[*].
Any
non-cash consideration received by Targeted or a Covered Affiliate from such
sublicensees shall be valued at its Fair Market Value as of the date of receipt.
Where any rights under this Agreement to Penn Patent Rights are sublicensed
by
Targeted or a Covered Affiliate in [*],
the
aggregate of any sublicense initiation fees or other such consideration not
associated with Sales received by Targeted or the Covered Affiliate shall for
purposes of this Section be [*]
under
this Agreement, on the one hand, and such other rights or interests, on the
other, in a manner that consistently and equitably reflects the [*]
that
have been so sublicensed toward Targeted’s or the Covered Affiliate’s having
[*].
If and
to the extent that any such fees or other such consideration is received due
to
the occurrence of [*]
that is
described in Section 4.3 or due to the occurrence of [*]
with
respect to the same Penn Licensed Product that occurred after a Section 4.3
milestone, the amount paid or payable to Penn under Section 4.3 with respect
to
such Penn Licensed Product [*],
but
[*].
The
scheduled percentages shall be:
[*]%
of such
sublicensing fees for any sublicense executed prior to [*]
such
Penn Licensed Product.
[*]%
of such
sublicensing fees for any sublicense executed after [*]
such
Penn Licensed Product.
[*]%
of such
sublicensing fees for any sublicense executed following the [*]
such
Penn Licensed Product.
*Confidential
Treatment
Requested.
-18-
For
example, if entry into [*]
for a
Penn Licensed Product provides to Penn a $[*]
milestone payment from Targeted pursuant to Section 4.3.2, and a sublicensing
deal [*]
after
completion of [*],
to the
extent applicable to the Penn Patent Rights, provides for a $ [*]
milestone payment to Targeted for entry into [*]
for such
Penn Licensed Product, then Targeted would owe Penn [*]%
[*]
milestone payment (i.e., $[*]
),
[*].
4.1.6 Any
right
of Penn or a third party to practice the Penn Patent Rights for educational
or
research purposes under Section 2.7 shall be royalty-free.
4.1.7 In
further consideration for agreeing to this Agreement, Targeted shall issue
to
Penn within two business days following the effectiveness of this Agreement
sixty-five thousand (65,000) shares of voting Common Stock of Targeted. Penn
will in connection with such issuance execute and deliver a stock subscription
agreement containing standard investor representations with respect to such
shares.
4.2
Development
Plan, Progress Reports, Financial Reports; Maintenance Fees.
4.2.1 Targeted
will provide Penn with a written plan (the “Development
Plan”)
within
thirty (30) days after the of signing this Agreement by both parties. The
Development Plan will [*].
The
Development Plan will separately address activities applicable to Group 1
Patents, Group 2 Patents, Group 3 Patents, Group 4 Patents, and Group 5 Patents,
respectively.
4.2.2 At
or
within thirty (30) days following each anniversary of the Effective Date,
Targeted will provide Penn with a written progress report that describes the
progress made against the Development Plan (as supplemented by progress reports,
where applicable), including the progress made by any Targeted Covered
Affiliates or sublicensees, submitted a year earlier and plans for development
in the coming year. Each such annual progress report will be deemed to update
and supplement the then-current Development Plan.
4.2.3 At
or
within thirty (30) days after the time Targeted, or any Targeted Covered
Affiliates or sublicensees files an IND with respect to a particular Penn
Licensed Product, Targeted will provide Penn with a written development plan
for
that Penn Licensed Product (the “Product-Specific
Plan”).
Each
Product-Specific Plan will outline [*].
4.2.4 Penn
shall keep all such reports referred to in Sections 4.2.1 through 4.2.3
confidential under Section 5.2 for five (5) years or until the time, if any,
of
the first commercial Sale of any Penn Licensed Product(s) as provided below,
whichever comes first. Targeted shall also notify Penn within thirty (30) days
of the first commercial Sale of any Penn Licensed Product.
4.2.5 Targeted
shall provide Penn with the following financial statements and information
(which may be consolidated with one or more of Targeted’s Affiliates, if
Targeted regularly so consolidates its financial statements) prepared according
to U.S. generally accepted accounting principles consistently applied, where
applicable:
*Confidential
Treatment
Requested.
-19-
| (a) |
Unaudited
financial statements forty-five (45) days following the end of each
Calendar Quarter. The format and detail of such statements shall
be agreed
upon in advance by Penn and
Targeted.
|
| (b) |
Audited
financial statements, produced by a certified public accounting firm,
ninety (90) days following the end of each of Targeted’s fiscal years, as
well as a copy of any management letter recommendations submitted
by the
auditors.
|
| (c) |
Copies
of all reports made available to shareholders, including 10K and
10Q
filings made to the United States Securities and Exchange
Commission.
|
4.2.6 Targeted
shall pay to Penn the following license maintenance fees until the first
commercial Sale of a Penn Licensed Product (after which time no further
maintenance fees will be payable under this Section 4.2.6): [*]
dollars
($[*])
on the
[*]
anniversary of the Effective Date, [*]
dollars
($[*])
on the
[*]
anniversary of the Effective Date, [*]
dollars
($[*])
on the
[*]
anniversary of the Effective Date, [*]
dollars
($[*])
on the
[*]
anniversary of the Effective Date, [*]
dollars
($[*])
on the
[*]
anniversary of the Effective Date, and [*]
dollars
($[*])
on the
[*]
anniversary of the Effective Date.
4.2.7 Following
the first commercial Sale of a Penn Licensed Product, Targeted shall pay to
Penn
a maintenance fee of [*]
dollars
($[*])
on each
anniversary of the Effective Date during the term of this Agreement which shall
be [*].
4.3
Milestone
Fees.
4.3.1 Subject
to Sections 4.3.3 and 4.3.4, Targeted shall pay to Penn a non-refundable
milestone fee as listed below for [*]
reaches
each of the following milestones, where such Penn Licensed Product has been
or
is in whole or in part developed by [*]
under a
right or sublicense granted by Targeted or a Covered Affiliate or otherwise
collaboratively by [*]
on the
one hand and by Targeted and/or Covered Affiliates on the other:
|
Milestone
|
Fee
Due
|
|
[*]
|
$[*]
|
|
[*]
|
$[*]
|
|
[*]
|
$[*]
|
*Confidential
Treatment
Requested.
-20-
4.3.2 Subject
to Sections 4.3.3 and 4.3.4, Targeted shall pay to Penn a non-refundable
milestone fee as listed below for [*]
reaches
each of the following milestones, where Section 4.3.1 is not applicable to
such
Penn Licensed Product:
|
Milestone
|
Fee
Due
|
|
[*]
|
$[*]
|
|
[*]
|
$[*]
|
|
[*]
|
$[*]
|
4.3.3 If
and to
the extent that any fees or other such consideration is paid to Penn by Targeted
pursuant to Section 4.1.5 due to the occurrence of a milestone that is described
in Section 4.3.1 or Section 4.3.2, or due to the occurrence of any other
developmental milestone with respect to the same Penn Licensed Product that
occurred prior to the milestone described in Section 4.3.1 or Section 4.3.2,
the
amount so paid to Penn under Section 4.1.5 with respect to such occurrence
shall
be [*]
with
respect to such milestone, but such [*].
For
example, if a sublicensing deal entered by Targeted prior to completion of
[*]
for a
Penn Licensed Product to which Section 4.3.1 is not applicable, to the extent
applicable to the Penn Patent Rights, provides for a $[*]
milestone payment to Targeted for entry into [*]
for such
Penn Licensed Product, Targeted would have paid Penn [*]%
of such
milestone payment pursuant to Section 4.1.5 (i.e., $[*]).
When
such Penn Licensed Product enters [*],
Targeted would owe Penn a $[*]
milestone payment pursuant to Section 4.3.2, but [*].
4.3.4 The
milestone fees otherwise payable under Section 4.3.1 or 4.3.2 shall be
[*]
with
respect to any Penn Licensed Product that, at the time a milestone was achieved,
had a competing product licensed under the Penn Patent Rights on sale.
4.4 Royalty
Reports and Records.
4.4.1 Targeted
shall deliver to Penn within sixty (60) days after the end of each Calendar
Quarter a report, certified by the chief financial officer of Targeted setting
forth in reasonable detail the calculation of the royalties due to Penn for
such
Calendar Quarter, including, without limitation:
| (i) |
Number
of Penn Licensed Products involved in Sales, listed by country if
readily
available;
|
| (ii) |
Gross
consideration for Sales of Penn Licensed Products, including all
amounts
invoiced, billed, or received;
|
| (iii) |
Qualifying
costs, as defined in Section 1.16, listed by category of
cost;
|
*Confidential
Treatment
Requested.
-21-
| (iv) |
Net
Sales of Penn Licensed Products listed by country if readily available;
and
|
| (v) |
Royalties
owed to Penn, listed by category, including without limitation earned
and
sublicensee-derived categories.
|
4.4.2 Royalties
payable under Section 4.1 hereof shall be paid within sixty (60) days following
the last day of the Calendar Quarter in which the royalties accrue and shall
accompany the report of Section 4.4.1.
4.4.3 Targeted
must maintain and cause its Covered Affiliates, sublicensees, and
sub-sublicensees, to maintain, complete and accurate books and records which
enable the royalties, fees, and payments payable under this Agreement to be
verified. The records for each Calendar Quarter must be maintained for three
years after the submission of each report under Article 4. Upon reasonable
prior
notice to Targeted, Targeted must provide Penn with access to all books and
records relating to the Sales of Penn Licensed Products by Targeted and its
Covered Affiliates, and sublicensees to conduct a review or audit of those
books
and records. Access to these books and records pertaining to Net Sales must
be
made available no more than once each Calendar Year for each Penn Licensed
Product, during normal business hours, and once each year for each Penn Licensed
Product during each of the three years after expiration or termination of this
Agreement. If a review or audit of the books of Targeted determines that any
of
Targeted, its Covered Affiliates, or sublicensees has underpaid royalties on
a
Penn Licensed Product by [*]
or more,
Targeted must pay the costs and expenses of Penn and its accountants in
connection with such review or audit. Notwithstanding the foregoing, Targeted
agrees to conduct, at its expense, an independent audit of Sales and royalties
with respect to a Penn Licensed Product at least every two (2) years once annual
Sales of such Penn Licensed Product are greater than five million dollars
($5,000,000) per annum. The audit shall address, at a minimum, the amount of
gross sales by or on behalf of Targeted, its Covered Affiliates, or sublicensees
during the audit period, the amount of funds owed to Penn under this Agreement,
and whether the amount owed has been paid to Penn and is reflected in the
records of the Targeted. A report by the auditors shall be submitted promptly
to
Penn upon completion.
4.5 Currency,
Place of Payment, Interest.
4.5.1 All
dollar amounts referred to in this Agreement are expressed in United States
dollars. All payments to Penn under this Agreement shall be made in United
States dollars by check payable to “The Trustees of the University of
Pennsylvania.”
4.5.2 If
Targeted, a Covered Affiliate, or their sublicensee receives revenues from
Sales
of Penn Licensed Products in currency other than United States dollars, revenues
shall be converted into United States dollars at the conversion rate for the
foreign currency as published in the eastern edition of The Wall Street Journal
as of the last business day of the applicable Calendar Quarter.
*Confidential
Treatment
Requested.
-22-
4.5.3 Amounts
that are not paid when due shall accrue interest from the due date until paid,
at a rate equal to one and one quarter percent (1.25%) per month (or the maximum
allowed by law, if less).
ARTICLE
5 - CONFIDENTIALITY
5.1 Targeted
shall use best efforts to maintain in confidence and not to disclose to any
third party other than Covered Affiliates any Confidential Information of Penn
received pursuant to this Agreement or the Existing Agreements. Targeted agrees
to ensure that its and its Covered Affiliates’ employees have access to
Confidential Information only on a need-to-know basis and are obligated in
writing to abide by Targeted’s obligations hereunder. The foregoing obligation
shall not apply to:
5.1.1 information
that is or was known to Targeted or its Covered Affiliates prior to the time
of
disclosure or that is or was at any time independently developed by Targeted
or
its Covered Affiliates without use of Confidential Information of Penn, in
each
case to the extent evidenced by written records;
5.1.2 information
disclosed to Targeted or its Covered Affiliates by a third party that has a
right to make such disclosure;
5.1.3 information
that becomes patented, published or otherwise part of the public domain
otherwise than due to a breach of this Agreement by Targeted or its Covered
Affiliates;
5.1.4 information
that is required to be disclosed by any statute, law, rule, regulation or order
of any governmental authority or a court of competent jurisdiction; provided
that Targeted shall use its best efforts to obtain confidential treatment of
such information by the agency or court; or
5.1.5 information,
to the extent it is disclosed pursuant to a confidentiality agreement binding
the recipient to confidentiality obligations at least as strict as those binding
Targeted under this Section.
5.2 Penn
shall not be obligated to accept any confidential information from Targeted
except for the reports required in Sections 4.2 and 4.4 and the results of
any
audit or review under Section 4.4.3. Penn shall use best efforts to maintain
in
confidence and not to disclose to any third party (subject to the same
exceptions accorded Targeted under Section 5.1) such reports or results
received, except that Penn may disclose to Wistar information from such reports
or results. Wistar shall use best efforts to maintain in confidence and not
to
disclose to any third party (subject to the same exceptions accorded Targeted
under Section 5.1) information received from Penn under this section. Penn
bears
no institutional responsibility for maintaining the confidentiality of any
other
confidential information of Targeted disclosed to Penn under this Agreement
or
the Existing Agreements.
-23-
5.3 The
placement of a copyright notice on any Confidential Information shall not be
construed to mean that such information has been published and will not release
Targeted from its obligation of confidence hereunder.
ARTICLE
6 - TERM AND TERMINATION
6.1 This
Agreement, unless sooner terminated as provided herein, shall terminate upon
the
expiration of the last to expire or become abandoned of the Penn Patent
Rights.
6.2 Targeted
may, at its option, terminate this Agreement at any time by doing all of the
following:
6.2.1 By
ceasing to make, have made, use and sell all Penn Licensed Products;
and
6.2.2 By
terminating all sublicenses, and causing all sublicensees to cease making,
having made, using and selling all Penn Licensed Products and terminate any
sub-sublicensees; and
6.2.3 By
giving
sixty (60) days notice to Penn of such cessation and of Targeted’s intent to
terminate; and
6.2.4 By
tendering payment of all accrued royalties.
6.3 Penn
may
terminate this Agreement if any of the following occur:
6.3.1 Targeted
becomes more than sixty (60) days in arrears in payment of royalties,
maintenance fees, patent expenses or any other expenses due pursuant to this
Agreement and Targeted does not provide full payment within thirty (30) days
of
written demand; provided, however, that if Targeted disputes in good faith
the
existence of an arrearage in payment,
|
(a)
|
Targeted
shall, within thirty (30) days after the demand for payment under
this
Section, remedy any such arrearage to the extent its existence is
not the
subject of such good faith dispute;
and
|
|
(b)
|
if
either of the parties has, within thirty (30) days after the demand
for
payment under this Section, initiated the dispute resolution procedures
of
Article 11 in order to attempt to resolve such good faith dispute,
Penn
shall wait for the additional time designated therein before taking
action
to terminate this Agreement; or
|
-24-
6.3.2 Targeted
becomes subject to a Bankruptcy Event; or
6.3.3 Targeted
materially breaches this Agreement and does not cure such material breach within
one hundred eighty (180) days after written notice thereof.
6.4 If
Targeted becomes subject to a Bankruptcy Event, all duties of Penn and all
rights (but not financial and indemnification obligations accrued prior to
termination) of Targeted under this Agreement shall immediately terminate
without the necessity of any action being taken either by Penn or by Targeted,
and, to the extent allowed by law, [*]
shall
become a direct licensee of Penn to the extent of any sublicense existing
between [*]
and
Targeted immediately preceding the Bankruptcy Event, without further action
by
Targeted, Penn or [*].
6.5 Targeted’s
obligation to pay royalties and all other obligations accrued under Articles
4
and 7 hereof and other considerations owed under this Agreement that have
matured as of the date of termination shall survive termination of this
Agreement. In addition, the provisions of Section 2.9, Article 3, and (for
a period of five (5) years following such termination) Article 5, and the
provisions of Articles 6, 9, 10, 11 and 12 shall survive such
termination.
ARTICLE
7 - PATENT MAINTENANCE AND REIMBURSEMENT
7.1 Penn
shall control and diligently prosecute and maintain Penn Patent Rights. Penn
and
Targeted shall decide upon a mutually agreeable choice of patent counsel and
a
mutually agreeable budget for and course of prosecution, and Targeted shall
be
copied on all substantive correspondence regarding such Penn Patent Rights.
The
parties acknowledge that neither of them currently has an intention to terminate
or substantially reduce the scope of the engagement of the patent counsel used
for such purposes by Penn prior to and as of the Effective Date. Subject to
Sections 7.2 and 7.3, Targeted shall pay, or shall reimburse Penn within sixty
(60) days of receipt of invoice for, all documented third party attorneys’ fees,
expenses, official fees and other charges incident to the preparation,
prosecution, licensing and maintenance of Penn Patent Rights, including
interferences, oppositions, etc. brought or defended in accordance with the
mutually agreed budget for and course of prosecution. Penn shall provide
Targeted with itemized statements reflecting these expenses quarterly. In the
event that Penn should decide not to file, prosecute or maintain applications
and patents for such Penn Patent Rights, Targeted shall have the opportunity
to
do so at Targeted’s sole expense.
7.2 Except
with respect to licenses granted by Penn to [*]
pursuant
to Section 2.2.2, if Penn at any time prior to or after the Effective Date
grants or has granted any rights or licenses to or for the benefit of any
Non-Targeted Party under any of the Penn Patent Rights, i.e., where it may
do so
outside the scope of the exclusive rights of Targeted or the Covered Affiliates
hereunder, Penn shall [*].
*Confidential
Treatment
Requested.
-25-
7.3 If
Targeted elects to discontinue payment for the filing, prosecution, and/or
maintenance of any patent application and/or patent contained in the Penn Patent
Rights (or with respect to any particular claims therein), it shall so notify
Penn, and any such patent application or patent (or such claims, as applicable)
shall thereupon be excluded from the definition of Penn Patent Rights and from
the scope of the licenses granted under this Agreement, and all rights relating
thereto shall revert to Penn and may be freely used or licensed by Penn.
7.4 Targeted,
the Covered Affiliates, and their sublicensees shall comply with all United
States and foreign laws with respect to patent marking of Penn Licensed
Products.
ARTICLE
8 - INFRINGEMENT AND LITIGATION
8.1 Penn
and
Targeted are responsible for notifying each other promptly of any infringement
of Penn Patent Rights which may come to their attention, including notice to
the
other of any certification filed under the United States “Drug Price Competition
and Patent Term Restoration Act of 1984”. Penn and Targeted shall consult one
another in a timely manner concerning any appropriate response
thereto.
8.2 Targeted
shall have the right, but not the obligation, to prosecute such infringement
at
its own expense. Targeted shall not settle or compromise any such suit in a
manner that imposes any obligations or restrictions on Penn or grants any rights
the Penn Patent Rights (other than to the extent Targeted has the right to
grant
such rights under this Agreement), without Penn’s written permission. Financial
recoveries from any such litigation will first be applied to reimburse each
party for its litigation expenditures with additional recoveries being paid
to
Targeted, subject to a royalty due Penn based on the provisions of Article
4
hereof.
8.3 Such
rights under Section 8.2 shall be subject to the continuing right of Penn to
intervene at Penn’s own expense and join Targeted or its Covered Affiliates, who
shall still prosecute, in any claim or suit for infringement of the Penn Patent
Rights. Any consideration received by Targeted or its Covered Affiliates in
settlement of any claim or suit shall be shared between Penn and Targeted (or
such Covered Affiliate) in proportion with the share of litigation expenses
incurred by each in such infringement action provided that Penn has paid at
least [*]
percent
([*]%)
of the
aggregate amount of such litigation expenses. In the event that Penn does not
satisfy the foregoing requirement, financial recoveries from any such litigation
will first be applied to reimburse both parties for their litigation
expenditures with additional recoveries being paid to Targeted, subject to
a
royalty due Penn based upon the provisions of Article 4 hereof.
8.4 If
Targeted and the Covered Affiliates fail to prosecute such infringement, Penn
shall have the right, but not the obligation, to prosecute such infringement
at
its own expense. In such event, financial recoveries will first be applied
to
reimburse each party for its litigation expenditures with additional recoveries
being retained by Penn; provided however, that Penn shall not settle such
infringement if such settlement affects Penn Patent Rights other than those
specifically at issue in such infringement action without Targeted’s written
permission, which shall not be unreasonably withheld.
*Confidential
Treatment
Requested.
-26-
8.5 In
any
action to enforce any of the Penn Patent Rights, either party, at the request
and expense of the other party, shall cooperate to the fullest extent reasonably
possible. This provision shall not be construed to require either party to
undertake any activities, including legal discovery, at the request of any
third
party except as may be required by lawful process of a court of competent
jurisdiction.
ARTICLE
9 - DISCLAIMER OF WARRANTY; INDEMNIFICATION
9.1 EXCEPT
AS
SET FORTH IN SECTION 9.5, THE PENN PATENT RIGHTS, PENN TECHNICAL INFORMATION,
PENN LICENSED PRODUCTS AND ALL OTHER TECHNOLOGY LICENSED UNDER THIS AGREEMENT
ARE PROVIDED ON AN “AS IS” BASIS AND PENN AND WISTAR MAKE NO REPRESENTATIONS OR
WARRANTIES, EXPRESS OR IMPLIED, WITH RESPECT THERETO. BY WAY OF EXAMPLE BUT
NOT
OF LIMITATION, PENN AND WISTAR MAKE NO REPRESENTATIONS OR WARRANTIES (i) OF
COMMERCIAL UTILITY; (ii) OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE;
OR (iii) THAT THE USE OF THE PENN PATENT RIGHTS, PENN TECHNICAL INFORMATION,
PENN LICENSED PRODUCTS AND ALL TECHNOLOGY LICENSED UNDER THIS AGREEMENT WILL
NOT
INFRINGE ANY PATENT, COPYRIGHT OR TRADEMARK OR OTHER PROPRIETARY OR PROPERTY
RIGHTS OF OTHERS. PENN AND WISTAR SHALL NOT BE LIABLE TO TARGETED, TARGETED’S
SUCCESSORS OR ASSIGNS OR ANY THIRD PARTY WITH RESPECT TO: ANY CLAIM ARISING
FROM
THE USE OF THE PENN PATENT RIGHTS, PENN TECHNICAL INFORMATION, PENN LICENSED
PRODUCTS AND ALL TECHNOLOGY LICENSED UNDER THIS AGREEMENT OR FROM THE
MANUFACTURE, USE OR SALE OF PENN LICENSED PRODUCTS; OR ANY CLAIM FOR LOSS OF
PROFITS, LOSS OR INTERRUPTION OF BUSINESS, OR FOR INDIRECT, SPECIAL OR
CONSEQUENTIAL DAMAGES OF ANY KIND.
9.2 Targeted
will defend, indemnify and hold harmless Penn and Wistar and their trustees,
officers, agents and employees (individually, an “Indemnified
Party”,
and
collectively, the “Indemnified
Parties”),
from
and against any and all liability, loss, damage, action, claim or expense
suffered or incurred by the Indemnified Parties (including attorney’s fees)
(individually, a “Liability”,
and
collectively, the “Liabilities”)
that
results from or arises out of: (a) the development, use, manufacture, promotion,
sale or other disposition of any Penn Technical Information, Penn Patent Rights
or Penn Licensed Products by Targeted, Covered Affiliates, their sublicensees,
or their other collaborators or distributors; (b) breach by Targeted of any
covenant or agreement contained in this Agreement; and (c) the enforcement
by an
Indemnified Party of its rights under this Section. Without limiting the
foregoing, Targeted will defend, indemnify and hold harmless the Indemnified
Parties from and against any Liabilities resulting from:
-27-
9.2.1 any
product liability or other claim of any kind related to the use by a third
party
of a Penn Licensed Product that was manufactured, sold or otherwise disposed
by
Targeted, Covered Affiliates, or their sublicensees, or their other
collaborators or distributors, pursuant to and within the scope of such
relationships;
9.2.2 a
claim
by [*]
or any
other party which Targeted has granted or promised to grant a license or option
to license that this Agreement violates the terms of any agreement to which
any
of them is a party;
9.2.3 a
claim
by a third party that the use by Targeted, Covered Affiliates, their
sublicensees, or their other collaborators or distributors, pursuant to and
within the scope of such relationships, of Penn Technical Information or Penn
Patent Rights or the design, composition, manufacture, use, sale or other
disposition of any Penn Licensed Product by them infringes or violates any
patent, copyright, trademark or other intellectual property rights of such
third
party; and
9.2.4 clinical
trials or studies conducted by or on behalf of Targeted, Covered Affiliates,
their sublicensees, or their other collaborators or distributors, pursuant
to
and within the scope of such relationships, relating to the Penn Technical
Information, Penn Patent Rights or Penn Licensed Products, including, without
limitation, any claim by or on behalf of a human subject of any such clinical
trial or study, any claim arising from the procedures specified in any protocol
used in any such clinical trial or study, any claim of deviation, authorized
or
unauthorized, from the protocols of any such clinical trial or study, and any
claim resulting from or arising out of the manufacture or quality control by
a
third party of any substance administered in any clinical trial or
study.
Notwithstanding
the foregoing, however, the Liabilities shall not include, and in no instance
shall Targeted be required to indemnify any Indemnified Party with respect
to,
any liability, claims, lawsuits, losses, damages, costs or expenses to the
extent the same are determined to be the result of any Indemnified Party’s gross
negligence or willful misconduct.
9.3 The
Indemnified Party shall promptly notify Targeted of any claim or action giving
rise to Liabilities subject to the provisions of the foregoing Section. Targeted
shall have the right to defend or to cause to be defended any such claim or
action, at its cost and expense. Targeted shall not settle or compromise any
such claim or action in a manner that imposes any restrictions or obligations
on
Penn or Wistar or grants any rights to Penn Patent Rights or Penn Licensed
Products (other than to the extent Targeted has the right to grant such rights
under this Agreement) without Penn’s prior written consent. If Targeted or a
Covered Affiliate or their sublicensee fails or declines to assume the defense
of any such claim or action within thirty (30) days after notice thereof, Penn
may assume the defense of such claim or action for the account and at the risk
of Targeted, and any Liabilities related thereto shall be conclusively deemed
a
liability of Targeted; provided however, that Penn shall not settle such claim
or action if such settlement affects Penn Patent Rights other than those
specifically at issue in such claim or action without Targeted’s written
permission, which shall not be unreasonably withheld. Targeted shall pay
promptly to the Indemnified Party any Liabilities to which the foregoing
indemnity relates, as incurred. The indemnification rights of Penn and Wistar
or
other Indemnified Party contained herein are in addition to all other rights
which such Indemnified Party may have at law or in equity or
otherwise.
*Confidential
Treatment
Requested.
-28-
9.4 Insurance.
9.4.1 Targeted
shall procure and maintain a policy or policies of commercial general liability
insurance, including broad form and contractual liability, in a minimum amount
of $[*]
combined
single limit per occurrence and in the aggregate as respects personal injury,
bodily injury and property damage arising out of Targeted’s performance of this
Agreement.
9.4.2 Targeted
shall, upon commencement of clinical trials involving Penn Licensed Products,
procure and maintain a policy or policies of product liability insurance in
a
minimum amount of $[*]
combined
single limit per occurrence and in the aggregate as respects bodily injury
and
property damage arising out of Targeted’s performance of this
Agreement.
9.4.3 The
policy or policies of insurance specified herein shall be issued by an insurance
carrier with an A.M. Best rating of A or better and shall name Penn and Wistar
as an additional insured with respect to Targeted’s performance of this
Agreement. Targeted shall provide Penn with certificates evidencing the
insurance coverage required herein and all subsequent renewals thereof. Such
certificates shall provide that Targeted’s insurance carrier(s) notify Penn in
writing at least 30 days prior to cancellation or material change in coverage.
Penn will retain such certificates and notices from Targeted’s insurance carrier
and provide copies of the same to Wistar upon written request.
9.4.4 Penn
shall periodically review the adequacy of the minimum limits of liability
specified herein. Further, Penn reserves the right to require Targeted to adjust
such coverage limits in accordance with prevailing industry norms. The specified
minimum insurance amounts shall not constitute a limitation on Targeted’s
obligation to indemnify Penn or Wistar under this Agreement.
9.5 Penn
hereby represents that (i) to its knowledge it has the lawful right to grant
the
licenses granted herein, and (ii) all actions necessary with respect to due
authorization, execution and performance of this Agreement to make it legal,
valid, binding and enforceable with regard to Penn have been taken.
*Confidential
Treatment
Requested.
-29-
9.6 Except
as
provided in Section 12.11, Targeted hereby represents that (i) to its knowledge
it has the lawful right to enter into and to perform its obligations under
this
Agreement, and (ii) except for board approval of the issuance of the shares
referred to in Section 4.1.7 (which approval Targeted will attempt to obtain
as
soon as practicable following the signature of this Agreement), all actions
necessary with respect to due authorization, execution and performance of this
Agreement to make it legal, valid, binding and enforceable with regard to
Targeted have been taken.
ARTICLE
10 - USE OF PENN’S NAME; INDEPENDENT CONTRACTOR
10.1 Targeted,
the Covered Affiliates, and their employees and agents shall not use, and shall
not permit their sublicensees or their other collaborators or distributors,
within the scope of such relationships, to use, Penn’s or Wistar’s name, any
adaptation thereof, any Penn or Wistar logotype, trademark, service xxxx or
slogan or the name, xxxx or logotype of any Penn or Wistar representative or
organization in any way without the prior, written consent of Penn or Wistar.
Notwithstanding the foregoing, Targeted, the Covered Affiliates, their
sublicensees or their other collaborators or distributors may use Penn’s or
Wistar’s name as required to comply with any federal or state securities
law.
10.2 Nothing
herein shall be deemed to establish a relationship of principal and agent
between Penn and Targeted, nor any of their agents or employees for any purpose
whatsoever. This Agreement shall not be construed as constituting Penn and
Targeted as partners, or as creating any other form of legal association or
arrangement which would impose liability upon one party for the act or failure
to act of the other party.
ARTICLE
11 - DISPUTE RESOLUTION
Any
unresolved dispute or difference between the parties arising out of or in
connection with this Agreement shall at the option of either party be referred
for review by the parties’ respective Senior Officers prior to either party’s
taking any formal legal enforcement action with respect thereto. The Senior
Officers shall discuss the dispute or difference, and shall meet with respect
thereto if either of them believes a meeting or meetings to be useful. The
Senior Officers have thirty (30) days (or such lesser or longer period as they
may agree is a useful period for their discussions) to try to resolve the
dispute or difference, after which time each party may take such other action
as
it deems appropriate.
ARTICLE
12 - ADDITIONAL PROVISIONS
12.1 Targeted
shall comply with all prevailing laws, rules and regulations pertaining to
the
development, testing, manufacture, marketing, sale, use, import or export of
products. Without limiting the foregoing, it is understood that this Agreement
may be subject to United States laws and regulations controlling the export
of
technical data, computer software, laboratory prototypes and other commodities,
articles and information, including the Arms Export Control Act as amended
in
the Export Administration Act of 1979, and that the parties’ obligations
hereunder are contingent upon compliance with applicable United States export
laws and regulations. The transfer of certain technical data and commodities
may
require a license from the cognizant agency of the United States Government
and/or written assurances by Targeted that Targeted shall not export data or
commodities to certain foreign countries without prior approval of such agency.
Penn neither represents that a license is not required nor that, if required,
it
will issue.
-30-
12.2 This
Agreement and the rights and duties appertaining thereto may not be assigned
by
Targeted without first obtaining the express written consent of Penn, except
that Targeted may assign its rights hereunder to [*]
upon
reasonable notice and an agreement by such Covered Affiliate or [*],
as the
case may be, to be bound by the rights and obligations of Targeted under this
Agreement, without further consent. Any other such purported assignment, without
the written consent of Penn, shall be null and of no effect. Penn shall not
unreasonably withhold consent for Targeted to assign this Agreement to a Covered
Affiliate or to a purchaser of all or substantially all of Targeted’s business,
or to the owner of all or substantially all of Targeted’s business pursuant to a
merger or consolidation plan.
12.3 Notices,
payments, statements, reports and other communications under this Agreement
shall be in writing and shall be deemed to have been received as of the date
dispatched if sent by personal delivery, public overnight courier (e.g. Federal
Express), certified mail, return receipt requested as follows:
If
for
Penn:
University
of Pennsylvania
Center
for Technology Transfer
0000
Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxxxx,
XX 00000-0000
Attention:
Managing Director
with
a
copy to:
Office
of
General Counsel
University
of Pennsylvania
000
Xxxxx
00xx
Xxxxxx,
Xxxxx 000
Xxxxxxxxxxxx,
XX 00000-0000
Attention:
General Counsel
*Confidential
Treatment
Requested.
-31-
If
for
Targeted:
Targeted
Genetics Corporation
0000
Xxxxx Xxx, Xxxxx 000
Xxxxxxx,
Xxxxxxxxxx 00000
Attn:
Chief Executive Officer
with
a
copy to:
Xxxxxx,
Xxxxxxxxxx & Xxxxxxxxx LLP
000
Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx,
XX 00000
Attention:
Xxxxx X. Xxxxxxx, Esq.
Either
party may change its official address upon written notice to the other
party.
12.4 This
Agreement shall be construed and governed in accordance with the laws of the
Commonwealth of Pennsylvania, without giving effect to conflict of law
provisions.
12.5 Except
as
provided in Section 3.2, this Agreement is intended to supersede the Liver/Lung
License and the Additional Fields License. The parties acknowledge that the
Sponsored Research Agreement was previously terminated and that this is the
entire agreement between the parties with respect to the subject matter hereof.
Any modification of this Agreement shall be in writing and signed by an
authorized representative of each party.
12.6 A
waiver
by either party of a breach or violation of any provision of this Agreement
will
not constitute or be construed as a waiver of any subsequent breach or violation
of that provision or as a waiver of any breach or violation of any other
provision of this Agreement.
12.7 Any
of
the provisions of this Agreement which are determined to be invalid or
unenforceable in any jurisdiction shall be ineffective to the extent of such
invalidity or unenforceability in such jurisdiction, without rendering invalid
or unenforceable the remaining provisions hereof or affecting the validity
or
enforceability of any of the terms of this Agreement in any other
jurisdiction.
12.8 The
headings and captions used in this Agreement are for convenience of reference
only and shall not affect its construction or interpretation.
12.9 Nothing
in this Agreement, express or implied, is intended to confer on any person,
other than the parties hereto, the Covered Affiliates, or their permitted
assigns, any benefits, rights or remedies.
*Confidential
Treatment
Requested.
-32-
12.10 Penn
and
Targeted shall not discriminate against any employee or applicant for employment
because of race, color, sex, sexual or affectional preference, age, religion,
national or ethnic origin, or handicap.
12.11 The
parties acknowledge that Targeted has agreed that it will not enter into this
Agreement without the approval of [*].
Accordingly, this Agreement shall not become effective unless and until it
is
approved for all purposes by [*];
provided, however, that if such approval is not obtained on or before the later
of the fifteenth (15th) day after the date this Agreement is signed by both
Targeted and Penn and the fifth (5th) day after Penn notifies Targeted that
this
Agreement has been approved in writing by Wistar (unless such period is extended
as Penn and Targeted may mutually agree is reasonable under the circumstances),
this Agreement shall not become effective and shall be considered null and
void
at the end of such period. Targeted shall notify Penn of such approval within
five business days after such [*]
approval
is obtained. Similarly, this Agreement requires the approval of the Board of
Directors of Targeted, and shall not become effective unless and until such
approval is obtained; provided, however, that if such approval is not obtained
on or before the later of the fifteenth (15th) day after the date this Agreement
is signed by both Targeted and Penn and the fifth (5th) day after Penn notifies
Targeted that this Agreement has been approved in writing by Wistar (unless
such
period is extended as Penn and Targeted may mutually agree is reasonable under
the circumstances), this Agreement shall not become effective and shall be
considered null and void at the end of such period. The “Effective Date” shall
for all purposes under this Agreement remain June 1, 2002, and once effective,
the parties intend that such effectiveness will be as of the Effective Date,
notwithstanding that the effectiveness of this Agreement occurs at a later
date,
upon such approval by [*]
and the
Board of Directors of Targeted.
[Signature
page follows]
*Confidential
Treatment
Requested.
-33-
IN
WITNESS WHEREOF the parties, intending to be legally bound, have caused this
Agreement to be executed by their duly authorized representatives as of the
Effective Date.
THE
TRUSTEES OF THE UNIVERSITY OF PENNSYLVANIA
| By: | /s/ Xxxxx X. Xxxxxxxx | |||
|
Printed
Name: Xxxxx X. Perneman
Title:
Managing Director, Center for Technology Transfer
|
Date
Signed: 8/19/02
TARGETED
GENETICS CORPORATION
| By: | /s/ H. Xxxxxxx Xxxxxx | |||
|
Name:
H. Xxxxxxx Xxxxxx
Title:
Chief Executive Officer
|
Date
Signed: 10/18/02
Genovo
hereby agrees to be bound by the rights and obligations of Targeted under the
foregoing Agreement, subject to the terms and conditions thereof, which shall
be
applicable to Genovo as well as to Targeted.
GENOVO,
INC
| By: | /s/ H. Xxxxxxx Xxxxxx | |||
|
Name:
H. Xxxxxxx Xxxxxx
Title:
Pres & CEO
|
Date
Signed: 10/18/02
Consented
to and approved:
THE
WISTAR INSTITUTE of
ANATOMY and
BIOLOGY
| By: | /s/ Xxxxxx X. Xxxxxxx | |||
|
Printed
Name: Xxxxxx X. Xxxxxxx, M.D.
Title:
Director and CEO
|
Date
Signed: 10/9/02
-34-
ATTACHMENT
1
PENN
PATENT RIGHTS
I. THE
PENN
LICENSED PATENTS IN THE FOLLOWING TABLE ARE THE GROUP 1 PATENTS:
|
Penn
Docket
Number
|
Targeted
Docket
Number
|
Attorney
File
Number
|
Brief
Title
|
Patent
Numbers and
Dates
|
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
*Confidential
Treatment Requested.
-35-
II. THE
PENN
LICENSED PATENTS IN THE FOLLOWING TABLE ARE THE GROUP 2
PATENTS:
|
Penn
Docket
Number
|
Targeted
Docket
Number
|
Attorney
File
Number
|
Brief
Title
|
Patent
Numbers and
Dates
|
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
*Confidential
Treatment Requested.
-36-
III. THE
PENN
LICENSED PATENTS IN THE FOLLOWING TABLE ARE THE GROUP 3 PATENTS:
|
Penn
Docket
Number
|
Targeted
Docket
Number
|
Attorney
File
Number
|
Brief
Title
|
Patent
Numbers and
Dates
|
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
*Confidential
Treatment
Requested.
-37-
IV. THE
PENN
LICENSED PATENTS IN THE FOLLOWING TABLE ARE THE GROUP 4 PATENTS:
|
Penn
Docket
Number
|
Targeted
Docket
Number
|
Attorney
File
Number
|
Brief
Title
|
Patent
Numbers and
Dates
|
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
*Confidential
Treatment Requested.
-38-
GROUP
4
PATENTS (CONTINUED):
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
*Confidential
Treatment Requested.
-39-
V. THE
PENN
LICENSED PATENTS IN THE FOLLOWING TABLE ARE THE GROUP 5
PATENTS:
|
Penn
Docket Number
|
Targeted
Docket Number
|
Attorney
File Number
|
Brief
Title
|
Patent
Numbers and Dates
|
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
*Confidential
Treatment Requested.
-40-
GROUP
5
PATENTS (CONTINUED):
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
*Confidential
Treatment
Requested.
-41-
ATTACHMENT
2
The
following recombinant adenoviruses and viral seed banks are Penn Technical
Information, unless otherwise covered by Penn Patent Rights and include without
limitation the particular samples thereof previously made, as described
below:
|
Vector
|
Penn
ID
|
Manufacture
Date
of
Particular
Samples
|
Vial
# of
Samples
|
|||
|
[*]
|
[*]
|
|||||
|
11/27/96
|
21
|
|||||
|
11/27/96
|
22
|
|||||
|
11/27/96
|
23
|
|||||
|
11/27/96
|
24
|
|||||
|
11/27/96
|
25
|
|||||
|
[*]
|
[*]
|
|||||
|
4/8/99
|
3
|
|||||
|
4/8/99
|
4
|
|||||
|
4/8/99
|
5
|
|||||
|
4/8/99
|
6
|
|||||
|
4/8/99
|
7
|
|||||
|
[*]
|
[*]
|
|||||
|
12/1/98
|
35
|
|||||
|
12/1/98
|
36
|
|||||
|
12/1/98
|
37
|
|||||
|
12/1/98
|
38
|
|||||
|
12/1/98
|
39
|
*Confidential
Treatment
Requested.
-42-
ATTACHMENT
2, CONTINUED
|
Vector
|
Penn
ID
|
Manufacture
Date
of
Particular
Samples
|
Vial
# of
Samples
|
|||
|
[*]
|
[*]
|
|||||
|
12/30/98
|
50
|
|||||
|
12/30/98
|
51
|
|||||
|
12/30/98
|
52
|
|||||
|
12/30/98
|
53
|
|||||
|
12/30/98
|
54
|
|||||
|
[*]
|
[*]
|
|||||
|
6/29/99
|
31
|
|||||
|
6/29/99
|
32
|
|||||
|
6/29/99
|
33
|
|||||
|
6/29/99
|
34
|
|||||
|
6/29/99
|
35
|
|||||
|
[*]
|
[*]
|
|||||
|
12/23/98
|
36
|
|||||
|
12/23/98
|
37
|
|||||
|
12/23/98
|
38
|
|||||
|
12/23/98
|
39
|
|||||
|
12/23/98
|
40
|
|||||
*Confidential
Treatment Requested.
-43-
ATTACHMENT
#3
[*]
*Confidential
Treatment
Requested.
-44-
