EXCLUSIVE LICENSE AGREEMENT
E-165
This
Exclusive License Agreement (“Agreement”)
is
made and entered into this 17th day of April 2002, by and between AltaRex
Corp.,
a corporation organized and existing under Business
Corporations Act
(Alberta), Canada, with executive offices located at 000 Xxxxxxx Xxxxxx,
Xxxxxxx, Xxxxxxxxxxxxx 00000 (“AltaRex”)
and
Unither Pharmaceuticals, Inc., a wholly-owned subsidiary of United Therapeutics
Corporation, a corporation organized and existing under the laws of the State
of
Delaware, located at 0000 Xxxxxx Xxxxxx, Xxxxxx Xxxxxx, Xxxxxxxx 00000, X.X.X.
(hereinafter referred to as “UP”).
AltaRex and UP may be referred to in this Agreement each individually as
a
“party”
and
jointly as the “parties”:
RECITALS
WHEREAS,
AltaRex has rights to certain antigen-targeted antibodies that may be effective
in the treatment of certain diseases;
WHEREAS,
UP is involved in the development and commercialization of products potentially
useful in the prevention, mitigation and treatment of disease; and
WHEREAS,
UP desires to obtain an exclusive license to certain intellectual property
rights owned or controlled by AltaRex in order to develop and commercialize
products for the treatment of diseases in accordance with the terms and
conditions set forth herein.
NOW,
THEREFORE, in consideration of the foregoing promises and the mutual covenants
herein contained, and for other good and valuable consideration, the receipt
and
sufficiency of which is hereby acknowledged, the parties agree as
follows:
ARTICLE
1
DEFINITIONS
For
purposes of this Agreement, the terms defined in this Article
1
shall
have the respective meanings set forth below:
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1.1
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“Affiliate”
means with respect to any party and with respect to United Therapeutics
Corporation any other Person which controls, is controlled by,
or is under
common control with, such party. As used in this Section 1.1,
“control” means (1)
that an entity or company owns, directly or indirectly, more than
fifty
percent (50%) of the voting stock of another entity, or (2)
that an entity, person or group has the actual ability to control
and
direct the management of the entity, whether by contract or
otherwise.
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1.2
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“Biomira Agreement”
means that certain Amended and Restated License Agreement entered
into by
AltaRex and Biomira Inc. dated as of September 3,
1999.
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1.3
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“Consideration”
means any cash or non-cash consideration of any kind whatsoever,
whether
tangible or intangible, direct or
indirect.
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1.4
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“Core Development Team”
means those individuals preliminarily identified on Appendix D
attached to this Agreement and any other individuals who will be
agreed
upon by the parties after the Effective
Date.
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1.5
|
“Data”
means any and all preclinical and clinical research, safety, use,
pharmacokinetics and efficacy data, Information, reports and analyses
and
all other information concerning the Licensed Technology which
is
available to AltaRex or UP and which is reasonably required for
the
development and commercialization of Products, including without
limitation, compilations, analyses, reports, studies, copies of
regulatory
filings and proceedings which relate to the Licensed
Technology.
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1.6
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“Dollars”
or “$”
means United States dollars.
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1.7
|
“Effective Date”
means the date appearing at the beginning of this
Agreement.
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1.8
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“FDA”
means the United States Food and Drug Administration or any successor
entity.
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1.9
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“Field”
means the treatment of any and all therapeutic indications and
uses.
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1.10
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“First Commercial Sale”
means, with respect to any Product, the first sale for use or consumption
by the general public of such Product. A transfer of the Product
by UP or
its sublicensees (a)
for research and development purposes, or (b)
prior to UP’s receipt of approval of an NDA by the FDA (or from the
governing health authority of any other country) for use of such
Product
in humans, shall not be considered a First Commercial
Sale.
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1.11
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“Improvements”
means any and all improvements to the Licensed Technology listed
in
Section 1.16(i),
namely, OvaRex®, BrevaRex®, ProstaRex™, AR54, and GivaRex™, for use in the
Field, whether or not patentable, including without limitation,
intellectual property rights, improvements, successors, modifications,
variations, revisions, versions and derivatives, as well as all
data,
know-how, methods, Information, processes, machines, manufactures
or
compositions of matter pertaining to the Licensed Technology to
the extent
they have application in the Field, which AltaRex may conceive,
discover
or develop at any time before or after the Effective Date of this
Agreement and during the term hereof, and which AltaRex has an
ownership
or licensable interest but only to the extent that AltaRex has
a right to
grant a sublicense in such licensable
interest.
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1.12
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“Information”
means information, results and data of any type whatsoever, in
any
tangible or intangible form, including without limitation inventions,
practices, methods, techniques, specifications, formulations, formulae,
knowledge, know-how, skill, experience, trade secrets, test data
(including pharmacological, biological, chemical, biochemical,
toxicological and clinical test data), analytical and quality control
data, stability data, studies and procedures, and other legal information
or descriptions, and all intellectual property rights
therein.
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2
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1.13
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“Joint
Intellectual Property”
means (c)
any Information specific to the development and/or commercialization
of
those certain antibodies known as OvaRex®, BrevaRex®, ProstaRex™, AR54,
and GivaRex™ solely invented or developed by UP or on behalf of UP or
jointly developed by or on behalf of the parties pursuant to this
Agreement and all intellectual property rights therein, including
without
limitation any Patents, Know-How and Improvements to the extent
claiming
such Information, and (d)
any other Information jointly developed by or on behalf of the
parties
pursuant to this Agreement and all intellectual property rights
therein,
including without limitation any Patents, Know-How and Improvements
claiming such Information. Notwithstanding the foregoing, (e)
inventions made solely by each party that are not under or do not
incorporate the Licensed Technology, or (f)
any Information obtained by each party that is not under or does
not
incorporate the Licensed Technology, shall not be deemed to constitute
Joint Intellectual Property and, accordingly, each party shall
solely own
all rights therein and thereto without restriction or obligation
to the
other party under this Agreement.
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1.14
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“Know-How”
means all Information, whether or not patentable, in which AltaRex
has an
ownership or licensable interest and (g)
which are not generally known including without limitation ideas,
concepts, formulae, procedures, methods, processes, protocols,
techniques,
materials and results of experimentation and testing, including
samples,
or (h)
which are set forth on Appendix B
to
this Agreement; and (i)
which are necessary or useful for UP to make, use, develop, sell
or seek
regulatory approval to market a Product, or otherwise necessary
to
practice or useful in practicing the Licensed
Technology.
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1.15
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“Laws”
means all federal, state, provincial and local laws, ordinances,
rules and
regulations in any jurisdiction applicable to this Agreement or
the
activities contemplated under this Agreement, whether such laws,
ordinances, rules and regulations are now or hereafter in
effect.
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1.16
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“Licensed
Technology”
means, collectively, (j)
OvaRex®, BrevaRex®, ProstaRex™, AR54, and GivaRex™ their formulations and
methods of administration; (k)
the Prior Development Technology; (l)
Patents, Know-How, and Joint Intellectual Property, (m)
all Information relating to those certain antibodies known as OvaRex®,
BrevaRex®, ProstaRex™, AR54, and GivaRex™ in the course of any work
conducted pursuant to this Agreement, and (n)
Improvements. The Licensed Technology does not include any technology,
formulation, method of administration, Patents, Know-How, Information
or
Improvements (collectively “NIH
Materials”)
to the extent any rights to such NIH Materials are granted to AltaRex
under the NIH Agreement (defined in Section 3.1
below) which NIH Agreement expires as of June 11, 2002.
Upon
AltaRex’s receipt prior to June 11, 2002 of UP’s written notice that
UP would like to sublicense the rights to such NIH Materials granted
to
AltaRex under the NIH Agreement, such Materials shall automatically
be
included in Licensed Technology.
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3
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1.17
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“NDA”
means a New Drug Application filed with the FDA or any equivalent
successor application.
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1.18
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“Net
Sales”
means, with respect to any Product, the invoiced sales price of
such
Product by UP, its Affiliates and its sublicensees to Third Party
purchasers, less the following deductions: (o)
credits, allowances, discounts, rebates, chargebacks, adjustments,
rejections and recalls for which the customer has been credited
the
original sales price and returns; (p)
price, cash, quantity, and trade discounts or rebates customary
to the
industry and actually allowed, given or accrued (including, but
not
limited to, cash, governmental and managed care rebates, and hospitals
or
other buying group chargebacks); (q)
sales, excise, inventory, value-added, and similar taxes (other
than
income tax) assessed on the sale of such Product; (r)
exportation, importation, transportation, and insurance charges;
and
(s)
uncollectible accounts as it relates to reimbursement in a 6 month
post-launch period provided UP exercises appropriate diligence
with
respect to obtaining reimbursement from state and federal agencies.
Unless
otherwise agreed among the parties in writing, “Net
Sales”
with respect to any Product requiring one or more active ingredients,
manufacturing or delivery technologies to be in-licensed in addition
to
the Licensed Technology, means the invoiced sales price of such
Product
billed to Third Party purchasers, less all the allowances, adjustments,
reductions, discounts, taxes, duties and other charges referred
to in the
foregoing sentence, multiplied by a fraction, the numerator of
which shall
be the manufacturing cost or acquisition cost, as applicable, of
the
Licensed Technology included in such Product and the denominator
of which
shall be the manufacturing cost or acquisition cost, as applicable,
of all
active ingredients, manufacturing and/or delivery technologies
in such
Product, including the Licensed Technology. In no event, however,
shall
the foregoing fraction be less than one-half (1/2). A sale of a
Product
shall be deemed to occur upon the earlier of (i) receipt of Consideration
for such Product from a Third Party purchaser; or (ii) forty-five
(45)
days after shipment of Product to a Third
Party.
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1.19
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“Patents”
means, within the Territory, (t)
all domestic and international issued patents and patent applications
set
forth in Appendix A
attached hereto which are owned by or licensed to AltaRex which
claim
(i)
a
Product, (ii)
the process of manufacture or use of a Product, or (iii)
a
congener, if any, described within the patents or patent applications
set
forth in Appendix A
to
this Agreement, together with any and all patents that issue or
in the
future issue therefrom, including utility and design patents and
certificates of invention, (iv)
any patent that claims an invention in the Licensed Technology,
and
(u)
any and all reissues, extensions, substitutions, confirmations,
registrations, revalidations, renewals, supplementary protection
certificates, additions, continuations, continuations-in-part,
divisions,
or foreign equivalents to any such patents and patent applications
to the
extent that they claim the subject matter set forth in (i)(a),
(b),
or (c)
above. To the extent that any existing patent or patent application,
patent disclosure or Improvement owned or licensed by AltaRex is
necessary
to practice any Patent as defined above, then such necessary patents,
patent applications, disclosures, and Improvements will be included
as
Patents, to the extent that AltaRex is capable to do
so.
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1.20
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“Person”
means an individual, corporation, partnership, trust, business
trust,
association, joint stock company, joint venture, pool, syndicate,
sole
proprietorship, unincorporated organization, governmental authority,
or
any other form of entity not specifically listed
herein.
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1.21
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“Prior Development Technology”
means (v)
all Information relating to those certain antibodies known as OvaRex®,
BrevaRex®, ProstaRex™, AR54, and GivaRex™ acquired and/or conceived of
and/or reduced to practice by AltaRex in the course of any research
and/or
any development work (including without limitation any clinical
trials)
conducted prior to this Agreement, and/or (w)
all right(s), title(s) and interest(s) in Information relating
to those
certain antibodies known as OvaRex®, BrevaRex®, ProstaRex™, AR54, and
GivaRex™ that AltaRex has licensed, received by assignment and/or acquired
in, from and/or pursuant to the Biomira Agreement or any other
agreements,
including without limitation, any Patents
thereunder.
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1.22
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“Product”
means any product, use, application, administration, method of
administration or treatment that utilizes and/or incorporates any
of the
Licensed Technology in the Field.
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1.23
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“Registration”
means, in relation to any Product, such approvals by government
authorities as may be legally required before such Product may
be
commercialized.
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1.24
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“Royalty Term”
means, with respect to each Product in each country, the period
of time
equal to the longer of (x)
ten (10) years from the date of the First Commercial Sale of such
Product
in such country, or (y)
if
the manufacture, use, import, offering for sale, or sale of such
Product
in such country is covered by a Valid Patent Claim, the term for
which
such Valid Patent Claim remains in effect and would, if in an issued
patent, be infringed but for the license granted by this
Agreement.
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1.25
|
“Territory”
means the universe with the exception of (z)
the member nations of the European Union as of the Effective Date,
and
(aa)
those certain countries and rights identified in Appendix
C
to
this Agreement.
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1.26
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“Third Party”
means any Person other than AltaRex, UP, and their respective
Affiliates.
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1.27
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1.28
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“Valid Patent Claim”
means a claim of an issued Patent that has not expired or been
canceled,
been declared invalid by an unreversed and unappealable decision
of a
court or other appropriate body of competent jurisdiction, been
admitted
to be invalid or unenforceable through reissue, disclaimer or otherwise,
and/or been abandoned.
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5
ARTICLE
2
REPRESENTATIONS
AND WARRANTIES
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2.1
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By
Both Parties.
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2.1.1
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Each
party represents and warrants to the other that it has the full
right,
power and authority to enter into this Agreement, perform this
Agreement
and to grant all of the rights, property and authorizations granted
in
this Agreement; that this Agreement has been duly executed and
delivered
by each party and is a legal, valid and binding obligation enforceable
against each party in accordance with its terms; that, to the best
of its
knowledge, there are no agreements, commitments or obstacles, technical
or
legal, including intellectual property rights of others, which
could
prevent it from carrying out all of its obligations hereunder;
and that
the execution, delivery and performance of this Agreement does
not and
will not violate any law, statute, local ordinance, state or federal
regulation, court order, or administrative order ruling, its corporate
charter or bylaws, nor any agreement by which it is
bound.
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2.1.2
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Each
party represents and warrants that it will use its best efforts
to obtain
and maintain in full force and effect all necessary licenses, permits
and
other authorizations required by Law to carry out its duties and
obligations under this Agreement. Each party shall cooperate with
the
other to provide such letters, documentation and other Information
on a
timely basis as the other party may reasonably require to fulfill
its
reporting and other obligations under Laws to applicable regulatory
authorities. Except for such amounts as are expressly required
to be paid
by a party to the other under this Agreement, each party shall
be solely
responsible for any costs incurred by it to comply with its obligations
under Laws. Each party shall conduct its activities hereunder in
an
ethical and professional manner.
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2.1.3
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Each
party hereby covenants that each of its employees and other Persons
performing any work during the Initial Assessment Period (as defined
below), under the UP Development Program (as defined below) or
under the
AltaRex Development Program (as defined below) shall have entered
into a
written invention assignment agreement requiring that each such
Person
assign to such party all right, title and interest in and to any
Information conceived of and/or reduced to practice by such Person
or its
employees, consultants or agents in connection with any activities
during
the Initial Assessment Period, under the UP Development Program
or under
the AltaRex Development Program.
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2.1.4
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Each
party hereby covenants that it shall not knowingly misappropriate
or
otherwise misuse, nor shall it knowingly permit any of its employees,
consultants or agents to misappropriate or otherwise misuse, any
Information of any Third Party in its conduct during the Initial
Assessment Period, of the UP Development Program or of the AltaRex
Development Program hereunder.
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2.2
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By
AltaRex.
AltaRex represents and warrants to UP
that:
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2.2.1
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AltaRex
is, as of the Effective Date, the sole owner or exclusive licensee
of the
Licensed Technology in the Territory with the power and right to
license
or sublicense the Licensed Technology in accordance with this Agreement
and, to the best of AltaRex’s knowledge as of the Effective Date, the use
of the Licensed Technology under the terms and conditions contemplated
by
this Agreement will not infringe upon any Third Party’s know-how, patent
or other intellectual property rights or constitute misuse of confidential
information by UP;
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2.2.2
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To
the best of AltaRex’s knowledge, no claim, whether or not embodied in an
action past or present, of any infringement, of any conflict with,
or of
any violation of any patent, trade secret or other intellectual
property
right or similar right of any Third Party, other than by Biomira,
Inc. has
been made or is pending or AltaRex has knowledge of a potential
claim with
respect to such Patents or the Prior Development
Technology;
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2.2.3
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Before
entering into this Agreement, AltaRex delivered to UP certain documents
and Information concerning AltaRex and those certain antibodies
known as
OvaRex®, BrevaRex®, ProstaRex™, AR54, and GivaRex™ (collectively, the
“AltaRex
Information Documents”).
The AltaRex Information Documents are accurate, complete (to permit
UP a
right to practice the license granted under Section 3.1)
and correct in all material
respects.
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2.2.4
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To
the best of AltaRex’s knowledge, (bb)
there is no action, suit, proceeding or investigation pending or
threatened against AltaRex that challenges the validity of this
Agreement
or the right of AltaRex to enter into this Agreement, or to consummate
the
transactions contemplated hereby, or which might result, either
individually or in the aggregate, in any material adverse change
in the
development of those certain antibodies known as OvaRex®, BrevaRex®,
ProstaRex™, AR54, and GivaRex™; or commercial sales of a Product
hereunder. The foregoing includes, without limitation, actions
pending or
threatened involving the prior employment of any of AltaRex’s employees,
their use in connection with AltaRex’s business or any Information or
techniques allegedly proprietary to any of their former employers,
or
their obligations under any agreements with prior employers; (cc)
any pending or threatened claims or litigation brought by a Third
Party
under any Third Party patent, trade secret or other Third Party
proprietary right in respect of AltaRex’s exploitation of the Licensed
Technology; (dd)
any basis upon which practice of the inventions described in the
Patents
or Know-How would infringe on the rights of Third Parties; (ee)
any licenses or other restrictions on the ability to develop, make,
have
made, use, import, market, promote, sell, have sold or otherwise
practice
the Licensed Technology; or (ff)
any scientific Information, published or unpublished, relating
to studies
or experiments with the Licensed Technology, whether conducted
by AltaRex
or by other parties, that would suggest development and commercialization
of the Licensed Technology is not
feasible;
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2.2.5
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To
the best of AltaRex’s knowledge, AltaRex is not a party or subject to the
provisions of any order, writ, injunction, judgment or decree of
any court
or government agency or instrumentality that would have a material
adverse
effect on the license granted pursuant to Section 3.1;
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2.2.6
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To
the best of AltaRex’s knowledge, AltaRex is not in violation of any
applicable Laws or restriction of any domestic or foreign government
or
any instrumentality or agency thereof in respect of the conduct
of its
business or the ownership of its properties which violation would
have a
material adverse effect on the development and commercialization
of those
certain antibodies known as OvaRex®, BrevaRex®, ProstaRex™, AR54, and
GivaRex™, or the commercial sales of a Product
hereunder;
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2.2.7
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A
complete list of (gg)
all patents and patents applications included in the Patents as
of the
Effective Date and (hh)
all Patents owned by Third Parties and validly and exclusively
licensed to
AltaRex, with the unrestricted right to exclusively sublicense
to UP, is
provided at Appendix A
attached to this Agreement. AltaRex owns or controls under valid
licenses
and has the right to license or sublicense, all right, title and
interest
in and to all such Third Party Patents listed on Appendix A.
A
complete list of all Information and data included in the Know-How
as of
the Effective Date is provided at Appendix B
attached to this Agreement;
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2.2.8
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AltaRex
has made or will make available to UP all material technical Information
in its possession or control that is pertinent to development or
commercialization of the Licensed Technology as permitted in Section
3.1;
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2.2.9
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The
Core Development Team identified on Appendix D
constitutes those individuals who have been developing the Licensed
Technology for AltaRex prior to the Effective Date and the individuals
who
AltaRex considers necessary for the continued development of the
Licensed
Technology in accordance with this Agreement;
and
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2.2.10
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AltaRex
will act in accordance with Section 4.5.2
below.
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2.2.11
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AltaRex
is in compliance in all material respects with all its obligations
under
the Biomira Agreement.
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2.2.12
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Prior
to the Effective Date, AltaRex has filed assignments with the Canadian
Patent Office assigning the following patent applications to AltaRex:
#2,292,912 and #2,333,221. As soon as practical after a serial
number has
been designated by the Canadian Patent Office, AltaRex shall file
an
assignment with the Canadian Patent Office assigning the following
patent
application to AltaRex: that Canadian national application identified
as
PCT/US00/22890.
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2.3
|
By
UP.
UP represents and warrants to AltaRex
that:
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2.3.1
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UP
will use commercially reasonable efforts to develop and commercialize
and
market Products for one or more indications within the
Field;
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2.3.2
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UP
will use its commercially reasonable best efforts to conduct its
Initial
Assessment Period obligations and meet its development obligations
and
milestones in accordance with Sections 4.1
and 4.2
below;
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2.3.3
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UP
will conduct all studies and clinical trials in accordance with
all
applicable Laws, Good Clinical Practices and medical ethical
rules;
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2.3.4
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UP
will adhere to all applicable Laws and Good Manufacturing Practices
in the
manufacturing, storing, selling, and exporting of
Product;
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2.3.5
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UP
will not use any individual to perform any services as contemplated
by
this Agreement who has been disbarred pursuant to the United States
Food,
Drug and Cosmetic Act; and
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2.3.6
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UP
will adhere to all applicable Laws regarding any of UP’s obligations under
this Agreement.
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ARTICLE
3
GRANT
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3.1
|
Grant.
Subject to the terms of this Agreement and with the exception of
Joint
Intellectual Property defined in Section 1.13(ii),
AltaRex hereby grants to UP a sole and exclusive, non-transferable
(other
than to an Affiliate with prior written notice to AltaRex), royalty
bearing license in the Territory, with the right to grant sublicenses,
under the Licensed Technology to develop, make, have made, use,
import,
market, promote, sell and have sold Products within the Field in
the
Territory. With respect to AR54 only, UP agrees and acknowledges
that the
Licensed Technology and AltaRex’s grant hereunder, excludes any and all
rights granted to AltaRex under the Public Health Service Patent
License
Agreement entered into between the National Institutes of Health
and
AltaRex effective as of September 11, 1999 (the “NIH
Agreement”)
and which NIH Agreement expires as of June 11,
2002.
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3.2
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Sublicenses.
With the exception of Joint Intellectual Property defined in Section
1.13(ii),
UP shall have the right to grant sublicenses, in the Territory,
under the
license in Section 3.1
above to any Third Party or Affiliate. UP shall deliver a copy
of each
sublicense under this Agreement to AltaRex promptly after execution
of the
same. Each sublicensee shall be subject to the same and identical
terms
and conditions of this Agreement. UP shall be liable for all actions
of
UP’s sublicensees.
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3.3
|
Grant
to AltaRex under Section 1.13(i).
UP hereby grants to AltaRex a sole and exclusive, royalty-free
license,
with the right to grant sublicenses, under its interest in Joint
Intellectual Property as defined in Section 1.13(i)
to
develop, make, have made, use, import, market, promote, sell and
have sold
Products within the Field outside of the Territory
only.
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3.4
|
Grant
to AltaRex under Section 1.13(ii).
UP hereby grants to AltaRex a sole and exclusive, royalty-free
license,
with the right to grant sublicenses, under its interest in Joint
Intellectual Property as defined in Section 1.13(ii)
to
the extent that such Joint Intellectual Property is not specific
to the
development and/or commercialization of those certain antibodies
known as
XxxXxx, XxxxxXxx, XxxxxxXxx, XX00 and
GivaRex.
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3.5
|
Sublicense
Rights.
Notwithstanding anything in this Agreement to the contrary, both
parties
agree that they will not sublicense any Joint Intellectual Property
as
defined in Section 1.13(ii)
to
a Third Party or to an Affiliate without the prior written consent
of the
other party.
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3.6
|
Covenant
Not to Xxx.
AltaRex agrees that it will not assert nor cause to be asserted
against
UP, its Affiliates or its sublicensees any existing invention,
Information, patent or know-how not included in the Licensed Technology
that is or might be infringed by reason of UP, its Affiliates or
its
sublicensees’ exercise of rights granted to UP under this Article
3.
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3.7
|
Biomira
Agreement.
The exclusive license granted to UP under this Agreement to the
extent
that such license covers Technology (as defined in the Biomira
Agreement)
(and the other provisions of this Agreement to the extent applicable)
are
subject and subordinate to the following sections of the Biomira
Agreement
(and any other provisions of the Biomira Agreement, such as the
defined
terms in Section 1.1 of the Biomira Agreement, which may be reasonably
necessary to permit an understanding of such sections): Section
2.1,
Section 2.3, Section 2.4, Section 2.7. Section 3.5, Section 4.3,
Section
4.5, Section 4.6, Article V, Section 6.1.1 and Section 6.1.2.
Copies
of these sections of the Biomira Agreement are attached to this
Agreement
as Appendix E.
|
|
3.8
|
University
of Maryland Agreement.
The exclusive license granted to UP under this Agreement to the
extent
that such license covers Patent Rights (as defined in the University
of
Maryland Agreement) (and the other provisions of this Agreement
to the
extent applicable) are subject and subordinate to the following
sections
of the University of Maryland Agreement (and any other provisions
of the
University of Maryland Agreement, such as the defined terms in
Section
1.02 and Article 2 and Exhibit A of the University of Maryland
Agreement, which may be reasonably necessary to permit an understanding
of
such sections): Section 3.01, Section 3.02, Section 3.04, Section
3.05,
Article 4, Article 6, Section 7.01, Section 7.02, Section 7.03,
Section
8.01(h), Section 8.01(i), Section 9.01. Section 9.02, Article 10,
Section
11.01, Section 11.02, Section 11.03, Section 11.04, Section 11.06,
Section
11.07, Section 11.08, and Section
19.04.
|
10
ARTICLE
4
DEVELOPMENT
AND COMMERCIALIZATION PROGRAM
|
4.1
|
Initial
Assessment Period.
|
|
4.1.1
|
The
parties acknowledge that it will be beneficial to UP to work closely
with
AltaRex for a period of time following the Effective Date in order
to
(ii)
perform a top-to-bottom assessment of all aspects of the development
of
the Licensed Technology conducted by or on behalf of AltaRex prior
to the
Effective Date so that UP may be fully informed of all development
progress, status, issues, concerns, assumptions, strategies, trade-offs,
limitations, decisions and similar elements and factors bearing
on the
state of the Licensed Technology as of the Effective Date, and
(jj)
to
reengineer, redesign, develop, propose and optimize turnkey solutions
and
strategies going forward with respect to all aspects of the successful
development of the Licensed Technology including, without limitation,
manufacturing, clinical trial design including a pivotal trial
design for
OvaRex®, intellectual property strategies, and market and competitive
assessments, the foregoing period referred to as the “Initial
Assessment Period”.
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|
4.1.2
|
UP
shall provide written notice to AltaRex when it has substantially
completed the Initial Assessment Period to its satisfaction and
is
prepared to proceed with the UP Development Program in accordance
with
Section 4.2
below or determines not to proceed with the UP Development Program
(the
date of such notice being the last day of the Initial Assessment
Period if
not earlier delivered in writing to AltaRex); provided, however,
that the
Initial Assessment Period shall be no longer than 240 days following
the
Effective Date. UP’s conclusions, recommendations and strategies going
forward that result from the Initial Assessment Period shall be
presented
to the Advisory Committee for evaluation and
discussion.
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|
4.1.3
|
From
the Effective Date, UP, at its sole expense, shall fund all reasonable
and
direct ongoing development costs incurred by either AltaRex or
UP in
accordance with this Agreement and with respect to developing the
Licensed
Technology in the Territory during the Initial Assessment Period
only;
provided, however, that AltaRex shall not incur any such development
expenses (the “AltaRex
Expenses”)
following the Effective Date that are not (i) in accordance with
a budget
approved by UP (the “AltaRex
Expense Budget”),
which approval shall not be unreasonably withheld or delayed, or
(ii) with
the prior written approval of UP, which approval shall not be unreasonably
withheld or delayed.
|
| 4.1.3.1 |
AltaRex
shall provide UP with a detailed monthly invoice within 15 days
of the end
of each month with a detailed listing of all AltaRex Expenses by
category
of the AltaRex Expense Budget. The total for each category shall
be
compared to the amount allowed in the AltaRex Expense Budget for
that
month. If a category total exceeds the budgeted amount (i.e., a
negative
variance), the excess will not be reimbursed until a positive variance
accumulates in a future month. Each invoice shall also be signed
by an
officer of AltaRex and shall certify that (kk)
all information contained in each invoice is complete and accurate
and
that AltaRex has no information that would require adjustment to
any prior
invoices; and (ll)
the invoices do not contain any charges for which UP is not responsible
in
accordance with this Agreement including, without limitation, any
costs
that are not with respect to developing Licensed Technology in
the
Territory. AltaRex shall provide copies of all vendor invoices
being
passed through on the monthly invoice. AltaRex shall be solely
responsible
for all AltaRex Expenses that are in excess of an approved AltaRex
Expense
Budget.
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11
| 4.1.3.2 |
AltaRex
shall not enter into agreements with Third Parties with respect
to AltaRex
Expenses without first submitting to UP a detailed proposal, budget
and
contract for each contract proposed to be performed by such Third
Parties.
UP will have the right to review and either approve or reject these
proposals in its sole discretion and in a timely manner. Upon approval,
AltaRex shall notify UP as to any material revisions to the proposed
contract for services with such approved Third Party and shall
send
detailed invoices for all work performed by approved Third Parties
to UP
for review prior to payment. All AltaRex expenditures in excess
of $25,000
shall be pre-approved in writing by an officer of
UP.
|
| 4.1.3.3. |
AltaRex
and UP will use its commercially reasonable best efforts to efficiently
transition payment for all ongoing expenses to UP for direct payment.
Within five days of the Effective Date, AltaRex shall provide a
list of
vendors from whom services have been procured and to whom amounts
are
expected to come due during the Initial Assessment Period. The
list shall
indicate the termination provisions of each vendor relationship
and the
expected amounts to be paid under each
arrangement.
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|
4.1.4
|
The
parties expect that UP will hire some of the Core Development Team
within
30 days of the Effective Date (the “Transition Period”). UP agrees that it
shall reimburse AltaRex for all actual and ordinary costs of employment
of
the Core Development Team during the “Transition Period”,
including wages, severance and benefits as provided in this Article
4
and Appendix D.
During the Transition Period, AltaRex shall (mm)
make no changes to compensation paid to the Core Development Team
without
the prior approval of UP, (nn)
operate the Licensed Technology in the same manner as it has been
operated
in the week prior to the Effective Date without the prior approval
of UP,
(oo)
not enter into any agreements that may encumber the Licensed Technology
within the Territory without the prior approval of UP, and (pp)
present to UP on May 17, 2002 a detailed invoice identifying
all
expenses incurred by AltaRex with respect to the Licensed Technology
in
the Territory during the Transition Period, including, without
limitation,
development costs as contemplated by Section 4.1.3,
employment costs contemplated by Section 4.1.4,
expenses contemplated by Section 4.1.6
and severance costs contemplated by Section 4.1.7.
AltaRex may invoice UP from time to time after May 17, 2002
in
connection with other expenses incurred during the Initial Assessment
Period for which UP is responsible in accordance with the provisions
of
this Article
4
.
UP shall examine each invoice and pay any undisputed amounts within
five
business days.
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12
|
4.1.5
|
In
the event that UP does not provide written notice to AltaRex of
its
decision to proceed with the UP Development Program in accordance
with
Section 4.2
below within two hundred forty (240) days or provides written notice
of
its determination not to proceed with the UP Development Program,
then in
such event AltaRex in its discretion may terminate the exclusive
license
granted to UP under this Agreement immediately on upon fifteen
(15) day
advance written notice to UP unless within such 15-day period UP
issues
such written notice. Upon fifteen (15) day written notice to AltaRex
at
any time during the Initial Assessment Period or within thirty
days
following completion of the Initial Assessment Period, UP may terminate
the exclusive license granted to it under this Agreement. Upon
the
foregoing termination events, the terms of Section 11.4.2
shall apply.
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|
4.1.6
|
During
the Transition Period, the Initial Assessment Period and the UP
Development Program for so long as AltaRex and UP agree that UP
may
maintain employees co-located with AltaRex employees, UP will pay
for its
proportionate share of overhead expenses related to the common
facilities
as used by the co-located employees. The parties shall agree on
reasonable
and customary terms for calculating the proportionate share of
overhead
expenses and for UP’s payments to
AltaRex.
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|
4.1.7
|
UP
agrees to assume the severance obligations of, and pay or reimburse
AltaRex for those severance expenses identified in Appendix D
relating to UP’s termination of the employment of any member of the Core
Development Team without Cause in accordance with such employees’
respective letter agreements; provided, however, that AltaRex shall
be
responsible for severance obligations, if any, solely for any employees
who choose to leave AltaRex during the Transition Period and not
as a
result of being terminated by UP without Cause. For the purposes
of this
Section 4.1.7,
Cause shall mean a failure to perform an employee’s responsibilities after
two prior written warnings.
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|
4.1.8
|
Prior
to the Effective Date, AltaRex has ordered certain manufacture,
formulation and other production services with respect to the preparation
of bulk drug product, clinical trial material and other forms and
formulations of OvaRex® (the “OvaRex® CTM”)
as identified in Appendix F.
UP agrees that it shall be responsible for the payment of the batches
of
such OvaRex® CTM identified in Appendix F
as
lots #2 and lots #3, estimated at approximately US$1 million
each in
cost, as such invoices are generated in the ordinary course of
business.
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13
|
4.2
|
Development
Program.
Subject to AltaRex performing AltaRex’s obligations to provide all
relevant materials and Information under this Agreement, UP shall
use its
commercially reasonable best efforts following completion of the
Initial
Assessment Period to diligently develop and conduct such research,
development and preclinical and clinical trials to obtain the necessary
regulatory approvals to market and commercialize such Products
as UP
determines are commercially feasible, and diligently obtain necessary
approvals to commence marketing and market one or more Products
in the
United States and such other countries of the Territory as UP determines
are commercially feasible (hereinafter the “UP
Development Program”).
The UP Development Program shall be directed by UP pursuant to
the results
from the Initial Assessment Period as evaluated by the Advisory
Committee
created under Section 4.9 below and as reasonably approved by
UP.
|
|
4.2.1
|
UP
Development Program Milestones.
UP shall use its best efforts to conduct the UP Development Program
and,
if in UP’s opinion, the results of the UP Development Program so justify,
to seek Registration for such Product in the United States and
pursue
manufacturing, commercialization and marketing of Products in the
United
States, and thereafter in such additional countries within the
Territory
as UP determines are commercially feasible. The UP Development
Program
shall include such product development work as UP may, in its sole
discretion, consider necessary for such Registration. UP shall
complete
enrollment in a pivotal OvalRex® study by April 30, 2004; and (ii) make an
OvaRex® BLA submission by April 30, 2006; provided, however, that the
foregoing milestone dates shall be extended by that number of days
as is
equivalent to the duration of the lnitial Assessment
Period.
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|
4.2.2
|
Failure
to Meet Milestone Schedule.
Subject to Section 4.2.3
below, in the event of UP’s failure to perform in accordance with the
development milestones in Section 4.2.1
above, AltaRex in its discretion may terminate the exclusive license
granted to UP under this Agreement upon 120-day advance written
notice to
UP, unless within such 120-day period, UP achieves such milestone
obligation. Upon such termination, the terms of Section 11.4.2
shall apply.
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|
4.2.3
|
Suspension
of Milestone Schedule.
UP’s obligation to meet the development milestones provided in Section
4.2.1
above is expressly conditioned on the continuing absence of any
material
safety or regulatory event or condition (such as, but not limited
to, a
regulatory action affecting a Product or the existence of an issue
relating to the safety or efficacy of a Product) that UP after
performing
due diligence and exercising reasonable business judgment, determines
that
development or marketing of the Product should be suspended or
stopped
altogether. In such an event, (qq)
UP’s obligations to develop or market a Product shall be suspended
so long
as any such condition or event exists, and (rr)
the development milestone schedule provided in Section 4.2.1
shall be extended by the period of any such
suspension.
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14
|
4.3
|
Reports.
UP will provide AltaRex with quarterly written progress reports,
summarizing in detail UP’s activities relating to the Initial Assessment
Period or the UP Development Program, and will provide such other
Information reasonably requested by
AltaRex.
|
|
4.4
|
Disclosure
of Inventions and Development Results.
Each party shall provide to the other party a complete written
disclosure
for each and every invention or other discovery, whether or not
patentable, first conceived or reduced to practice in the performance
of
the Initial Assessment Period, the UP Development Program or the
AltaRex
Development Program (as it relates to the Licensed Technology)
including
without limitation, Improvements (whether or not AltaRex has a
right to
grant a sublicense with respect to such Improvement) and Joint
Intellectual Property, promptly after each such invention is made.
Each
party shall regularly inform the other party of the results of
the Initial
Assessment Period, the UP Development Program or the AltaRex Development
Program (as it relates to the Licensed Technology), and shall provide
copies of the results and raw data from the Initial Assessment
Period, the
UP Development Program or the AltaRex Development Program (as it
relates
to the Licensed Technology), as requested. As used herein, “raw data”
means all Information generated by employees and other Persons
working on
the Initial Assessment Period, the UP Development Program or the
AltaRex
Development Program (as it relates to the Licensed Technology),
whether in
written, graphic or electronic form, and including without limitation
all
materials such as films, printouts, and photographs that record
such
Information, concerning work conducted pursuant to the Initial
Assessment
Period, the UP Development Program or the AltaRex Development Program
(as
it relates to the Licensed
Technology).
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|
4.5
|
Regulatory
Efforts and Coordination.
|
|
4.5.1
|
Within
the Territory.
UP shall solely manage all applications, requests for authorization,
submissions of Information and data and for all interactions with
the FDA
or applicable governing health authority for the purpose of attempting
to
obtain registration of the Products within the Territory in accordance
with the Initial Assessment Period or the UP Development Program.
UP shall
have the final authority to make all clinical and regulatory decisions
with respect to the registration of Products within the Territory
in its
sole reasonable discretion. UP shall provide AltaRex with sufficient
time
to review and approve all material submissions of Information and
data
prior to submission to the FDA or applicable governing health authority,
and AltaRex shall participate and collaborate in the process of
Product
registration including, without limitation, participation in meetings
with
regulatory authorities and interaction with UP staff, contractors
and
consultants on a regular basis regarding the development and
commercialization of Products. UP shall solely and exclusively
own all
regulatory applications, approvals, clinical data and Product
registrations obtained by UP or its Affiliates with respect to
Products
within the Territory, including retaining control and ownership
of each
Drug Master File related to the Licensed Technology within the
Territory.
For the avoidance of doubt, the foregoing materials shall be deemed
to be
Data.
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15
|
4.5.2
|
Outside
of the Territory.
AltaRex intends to research, develop and conduct certain preclinical
and
clinical activities in order to obtain the necessary regulatory
approvals
to market and commercialize products incorporating or based directly
or
indirectly on the Licensed Technology outside of the Territory
as AltaRex
shall determine in its discretion (hereinafter the “AltaRex
Development Program”).
AltaRex shall provide prompt written notice to UP of all aspects
of the
AltaRex Development Program, and shall promptly update UP in writing
with
respect to all material changes in such AltaRex Development Program
that
may arise from time to time. UP shall review and approve in writing
the
AltaRex Development Program, and all material changes thereto from
time to
time, in an effort to ensure that the Initial Assessment Period
and the UP
Development Program are not jeopardized or adversely affected by
the
AltaRex Development Program, such approval not to be unreasonably
withheld
or delayed by UT. Qualified personnel of UP shall be permitted
to
participate and collaborate in the Product registration process
by AltaRex
outside of the Territory, including without limitation the review
of
filings prior to submission to regulatory authorities outside of
the
Territory, participation in meetings with regulatory authorities,
and
interaction with AltaRex personnel on a regular basis regarding
the status
of regulatory filings. The parties shall closely cooperate on any
matters
involved in and arising from the development and commercialization
process
that may materially affect the other party’s efforts to register Products
within each party’s respective territory. Each party shall closely consult
with the other with regard to its participation in important clinical
development meetings. AltaRex shall provide UP with quarterly written
progress reports, summarizing in detail AltaRex’s activities relating to
the AltaRex Development Program, and will provide such other Information
reasonably requested by UP.
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|
4.5.3
|
Clinical
Data.
Each party hereby grants to the other party full and complete access
to
all Data it develops or controls for the other party’s use in connection
with such party’s efforts to obtain Product registrations within such
party’s territory, including without limitation the right to use and
submit all Data to governmental authorities to the extent legally
required
and as otherwise necessary in support of Product applications for
registration, and to make full reference to the CMC and Drug Master
File.
|
|
4.6
|
Records.
Each party shall maintain complete and accurate records, in sufficient
detail and in good scientific manner appropriate for patent purposes,
which shall properly reflect all work conducted and all results
achieved
in the performance of its research and development regarding the
Licensed
Technology and the Products (including all data in the form required
under
all applicable laws and regulations) appropriate for patent and
regulatory
purposes. The other party shall have the right, during normal business
hours and upon reasonable notice to inspect and copy such
records.
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16
|
4.7
|
Visits.
Appropriate employees, agents and outside consultants of each party
may
visit the other party at its offices and laboratories during normal
business hours and upon reasonable prior written notice in the
event that
the parties’ offices are not co-located in the same facility, and may
discuss the Initial Assessment Period and its results, the UP Development
Program and its results and the AltaRex Development Program and
its
results in detail with the technical personnel and consultants
of the
other party. All visits shall be conducted in a manner so as not
to
disrupt a party’s business nor cause any disclosure of any other
confidential information of such
party.
|
|
4.8
|
Compliance with Laws.
The parties shall comply with all applicable Laws in performing
their
obligations hereunder and in any of their dealings with respect
to the
Product.
|
|
4.9
|
Advisory Committee.
|
|
4.9.1
|
Composition
of the Advisory Committee.
An Advisory Committee shall be comprised of two representatives
of AltaRex
and two representatives of UP with an appropriate level of skill,
experience and familiarity with the Initial Assessment Period,
the UP
Development Program or the AltaRex Development Program. The initial
representatives for AltaRex shall be Xxxxxxx X. Xxxxxx and
Xxxxxx
Xxxxxx. The initial representatives for UP shall be Xxxxxxx Xxxxxxxxx,
Ph.D. and Xxxxx Xxxxxxx, M.D. Each party may substitute one or
more of its
representatives, in its sole discretion, effective upon agreement
of the
other party of such change, such agreement not to be unreasonably
withheld
or delayed.
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|
4.9.2
|
Meetings.
The Advisory Committee shall meet not less than twice each year
during the
term of this Agreement on such dates and at such time and places
as agreed
to by the parties, alternating between AltaRex’s principal offices and
UP’s principal offices, or such other locations as the parties shall
agree, unless both parties mutually determine that a meeting should
not
take place. At such meetings, the Advisory Committee shall discuss
the
parties’ research and prospective development and commercialization
efforts under this Agreement, the Initial Assessment Period, the
development budget, development priorities, UP’s requirements from
AltaRex, any actual regulatory filings regarding Products together
with
any anticipated regulatory filings with respect to possible products,
pricing of Product, patent filings, and, in general, shall coordinate
the
development and commercialization of Products. Each party shall
bear its
own expenses in connection with travel and attendance at such
meetings.
|
|
4.10
|
AltaRex
Obligations.
|
|
4.10.1
|
Information.
AltaRex, at its sole expense, shall be responsible for the timely
delivery
to UP of all Information available to AltaRex regarding the Licensed
Technology and reasonably required by UP to fulfill its obligations
under
this Agreement, including but not limited to, Information, compilations,
analyses, reports, studies, data, copies of regulatory filings
and
proceedings which AltaRex has developed or acquired which may be
related
to the licensed rights and which concerns or relates to preclinical
and
clinical research, safety, use, efficacy, and copies of findings
or
reports which are required by the FDA or similar regulatory
agencies.
|
17
|
4.10.2
|
Cooperation.
AltaRex shall, upon the request by UP, provide UP with reasonable
assistance and consultation regarding the Licensed Technology,
including
reasonable access to sample materials and data and the execution
of
necessary and appropriate instruments and
documents.
|
|
4.10.3
|
Clinical
Trial Material.
AltaRex shall provide UP free of charge with all bulk drug substance,
clinical trial material and other forms and formulations of OvaRex® and
other compounds and products within the Licensed Technology in
AltaRex’s
possession or control as of the Effective Date as UP shall reasonably
request in connection with the performance of its obligations during
the
Initial Assessment Period and the UP Development Program and otherwise
in
accordance with this Agreement.
|
|
4.11
|
Registration
of License.
UP may, at its expense, register the exclusive license granted
under this
Agreement in any country, or community or association of countries
within
the Territory, where the use, sale or manufacture of a Product
in such
country would be covered by a Valid Patent Claim. Upon request
of UP,
AltaRex agrees, after AltaRex reviews for accuracy, promptly to
execute
any “short form” licenses in a form submitted to it by UP from time to
time in order to effect the foregoing registration in such
country.
|
|
4.12
|
Supply
of Products.
UP will be contracting for the manufacture and supply of clinical
trial
material and commercial Products. If requested by AltaRex, the
parties
shall commence good faith negotiations to enter into an agreement
in which
AltaRex’s reasonable requirements for clinical trial material and
commercial Products for use outside the Territory may be added
to UP’s
purchasing requirements; provided, however, that such additional
AltaRex
requirements do not result in increased costs, manufacturing delays,
or
otherwise jeopardize in any manner the cost, quality and timely
delivery
of clinical trial material or Products in accordance with the UP
Development Program. Such agreement shall include payment price,
delivery
schedule, ordering procedures and other standard terms and conditions
contained in similar agreements.
|
ARTICLE
5
PAYMENTS
AND ROYALTIES
|
5.1
|
Milestone
Payments.
In partial consideration for the grant of the license under the
Licensed
Technology to UP under Section 3.1,
UP shall pay AltaRex the milestone payments in the amount specified
below
for each indication for which UP seeks regulatory approval of a
Product,
such payment to be made within thirty days following the completion
of the
corresponding event designated
below:
|
18
|
Milestone
Event
|
Milestone
Payment
(Millions
of Dollars)
|
|
|
Commencement
of pivotal Phase 3 enrollment
|
$0.600
|
|
|
Completion
of BLA filing
|
$1.400
|
|
|
BLA
approval by FDA
|
$3.000
|
The
parties acknowledge that the first milestone payment to AltaRex in connection
with the development of OvaRex® for the treatment of ovarian cancer shall be
upon completion of a BLA filing.
|
5.2
|
Royalties.
|
|
5.2.1
|
In
partial consideration for the grant of the license under the Licensed
Technology to UP under Section 3.1,
following First Commercial Sale UP shall pay AltaRex a stepped
royalty
based on the aggregate annual Net Sales of each Product sold in
the
Territory by UP, its Affiliates and sublicensees during the Royalty
Term:
|
| Annual Net Sales 0 - $500 Million | 7% |
| Annual Net Sales $500 Million - $1 Billion | 8% |
| Annual Net Sales over $1 Billion | 9%; |
provided,
however, that (ss)
with
respect to Net Sales of OvaRex® only, the above royalty rates shall apply with
UP responsible for payment of an additional 3% royalty directly to Biomira,
Inc.
in accordance with the Biomira Agreement, and (tt)
with
respect to Net Sales of ProstaRex™ only, the above royalty rates shall apply
with UP responsible for payment of an additional 1% royalty directly to the
Noujaim Institute in accordance with the Noujaim Institute for Pharmaceutical
Oncology Research, Faculty for Pharmacy and Pharmaceutical Sciences, University
of Alberta Research Agreement.
|
5.3
|
Accrual
of Royalties.
No royalties shall be payable on a Product distributed to Third
Parties
solely as a sample for testing or evaluation purposes. No multiple
royalty
shall be payable on the sale of any one Product. No multiple royalty
shall
be payable on a Product because the manufacture, use or sale of
such
Product is covered by more than one Patent or is subject to both
Know-How
and a Valid Patent Claim. UP shall have the right to distribute
(without
receipt of Consideration and without payment of a royalty to AltaRex)
in
any calendar year for compassionate purposes to indigent patients,
an
aggregate of up to five percent (5%) of the total number of Products
sold
in units (with the receipt of Consideration) in such calendar year
by UP,
its Affiliates and sublicensees.
|
19
|
5.4
|
Third
Party Royalties.
With the exception of possible royalties to Biomira, Inc. and the
Noujaim
Institute in accordance with Section 5.2
above, if UP, its Affiliates or its sublicensees determine, at
UP, its
Affiliates’ or its sublicensee’s discretion and after consulting with
AltaRex, that they are required to pay royalties to any Third Party
because the manufacture, use or sale of Products infringes any
patent or
other intellectual property rights of such Third Party in any country
in
the Territory, UP, its Affiliates or its sublicensees may deduct
from
royalties thereafter due with respect to Net Sales of such Product
in such
country up to (fifty percent, 50%) of the royalties or such other
fees
paid to such Third Party; provided, however, that in no event shall
the
royalties due on such Net Sales of Products on account of any reduction
pursuant to this Section 5.4 be thereby reduced by more than fifty
percent
(50%) of the royalties which otherwise would have been due hereunder
on
such Net Sales of such Products (reflecting 50% of the Reduced
Royalty
where the Reduced Royalty applies in accordance with Section 5.8).
|
|
5.5
|
Compulsory
Licenses.
Should a compulsory license be granted to a Third Party under the
applicable laws of any country in the Territory under the Licensed
Technology hereunder, the royalty rate payable hereunder for the
sale of
Products in such country shall be reduced by an amount equivalent
to the
lower royalty rate granted to such Third Party for such
country.
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5.6
|
Commercial Hardship.
If in any country UP can demonstrate that for any reason beyond
it, its
Affiliates’ or its sublicensees’ control the royalty payable hereunder by
UP causes or may cause UP, its Affiliate or its sublicensee a significant
reduction in its or their sales of Product in that country, or
otherwise
causes or may cause hardship in the promotion or sale of Product
in a
country, the parties shall meet and in good faith endeavor to agree
on a
reduction in the royalty rate payable in that country that will
place UP,
its Affiliates or its sublicensees in a position to competitively
market
such Product in such country.
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5.7
|
Reduction
in Royalty Due to Invalid Claim.
In the event that all applicable patent claims included in the
Patents
under which UP is selling or actively developing a Product shall
be held
invalid by a court of competent jurisdiction in a given country,
whether
or not there is a conflicting decision by another court of competent
jurisdiction in such country, the royalty to be paid by UP under
this
Section 5 shall be reduced to fifty percent (50%) of the royalties
which
otherwise would have been due hereunder on such Net Sales of such
Products
in such country (reflecting 50% of the Reduced Royalty where the
Reduced
Royalty applies in accordance with Section 5.8)
until such judgment shall be finally reversed by an unappealed
or
unappealable decree of a court of competent jurisdiction of higher
dignity
in such country; provided, however, that if and to the extent such
judgment is finally reversed by an unappealed or unappealable decree
of a
court of competent jurisdiction, the former royalty payments shall
be
resumed and the royalty payments not therefore made shall become
due and
payable.
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20
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5.8
|
Reduction
in Royalty Due to Failure of Material Patent Claim to
Issue.
In the event that at least one Material Claim fails to issue in
a country
of the Territory prior to regulatory approval of the first Product
in such
country, then the royalty to be paid by UP under this Section 5
shall be
reduced to fifty percent (50%) of the royalties which otherwise
would have
been due hereunder on Net Sales of such Product in such country
(the
“Reduced Royalty”),
provided however that if a Material Claim issues for a Product
in such
country after approval, the reduced royalty rate provided in this
Section
5.8
shall no longer apply following the date such Material Claim issues
with
respect to sales in such country for so long as such Material Claim
remains a Valid Patent Claim. For the purposes of this Section
5.8,
a
“Material Claim”
is a claim which has a scope at least as broad as the following
claim: a
method of eliciting a host immune response comprising administering
to a
host in need thereof a binding agent which binds to an epitope
of a
multi-epitopic antigen and forms a binding agent/antigen pair in
said
host, such that a host immune response is elicited against at least
a
second epitope on the antigen.
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5.9
|
Sublicensing.
In the event that UP grants a sublicense under Section 3.2
to
a sublicensee to make, use or sell the Product, such sublicenses
shall
require the sublicensee to account for and report its Net Sales
of the
Product on the same basis as if such sales were Net Sales of the
Product
by UP, and UP shall pay royalties on such sales as if the Net Sales
of the
sublicensees were Net Sales of UP.
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ARTICLE
6
ROYALTY
REPORTS, ACCOUNTING AND PAYMENT
|
6.1
|
Reports,
Exchange Rates.
UP shall notify AltaRex in writing promptly upon the First Commercial
Sale
of a Product by UP, its Affiliates or its sublicensees. During
the term of
this Agreement following the First Commercial Sale of a Product,
UP shall
furnish to AltaRex a quarterly written report showing in reasonably
specific detail, on a country by country basis: (uu)
the gross sales of each Product sold by UP, its Affiliates and
its
sublicensees during the reporting period and the calculation of
Net Sales
from such gross sales; (vv)
the royalties payable in Dollars, if any, which shall have accrued
hereunder based upon Net Sales of each Product; (ww)
the withholding taxes, if any, required by law to be deducted in
respect
of such sales; (xx)
the date of the First Commercial Sales of each Product in each
country
during the reporting period; and (yy)
the exchange rates used in determining the amount of Dollars. With
respect
to sales of Products invoiced in Dollars, the gross sales, Net
Sales, and
royalties payable shall be expressed in Dollars. With respect to
sales of
Products invoiced in a currency other than Dollars, the gross sales,
Net
Sales and royalties payable shall be expressed in the domestic
currency of
the party making the sale together with the Dollar equivalent of
the
royalty payable. The Dollar equivalent shall be calculated using
the
average exchange rate (local currency per US$1) published in The
Wall
Street Journal, Western Edition, under the heading “Currency Trading,” on
the last business day of each month during the applicable calendar
quarter. Reports shall be due on the sixtieth (60th) day following
the
close of each quarter. UP, its Affiliates and its sublicensees
shall keep
complete and accurate records in sufficient detail to properly
reflect all
gross sales and Net Sales and to enable the royalties payable hereunder
to
be determined.
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21
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6.2
|
Audits.
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|
6.2.1
|
Upon
the written request of AltaRex, and not more than once in each
calendar
year, UP shall permit an independent certified public accounting
firm of
nationally recognized standing, selected by AltaRex and reasonably
acceptable to UP, at AltaRex’s expense, to have access during normal
business hours to such of the records of UP as may be reasonably
necessary
to verify the accuracy of the royalty reports hereunder for any
year
ending not more than twenty-four (24) months prior to the date
of such
request. The accounting firm shall disclose to AltaRex only whether
the
records are correct or not and the specific details concerning
any
discrepancies. No other information shall be
shared.
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6.2.2
|
If
such accounting firm concludes that additional royalties were owed
during
such period, UP shall pay the additional royalties within thirty
(30) days
of the date AltaRex delivers to UP such accounting firm’s written report
so concluding. The fees charged by such accounting firm shall be
paid by
AltaRex; provided however, that if the audit discloses that the
royalties
payable by UP for the audited period are more than one hundred
five
percent (105%) of the royalties actually paid for such period,
then UP
shall pay the reasonable and direct fees and expenses charged by
such
accounting firm.
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6.2.3
|
UP
shall include in each sublicense granted by it pursuant to this
Agreement
a provision requiring the sublicensee to make reports to UP, to
keep and
maintain records of sales made pursuant to such sublicense, and
to grant
access to such records by AltaRex’s independent accountant to the same
extent required of UP under this Agreement. Upon the expiration
of
twenty-four (24) months following the end of any year, the calculation
of
royalties payable with respect to such year shall be binding and
conclusive upon AltaRex and UP, its Affiliates and
sublicensees.
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6.3
|
Confidential
Financial Information.
AltaRex shall treat all financial information subject to review
under this
Article
6
or
under any sublicense agreement as confidential and shall cause
its
accounting firm to retain all such financial information in
confidence.
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|
6.4
|
Payment Terms.
Royalties shown to have accrued by each royalty report provided
for under
this Article
6
shall be due and payable on the date such royalty report is due.
Payment
of royalties in whole or in part may be made in advance of such
due
date.
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6.5
|
Payment Method.
Except as provided in Section 6.6,
all royalty payments by UP under this Agreement shall be paid in
Dollars,
and all such payments shall be originated from a United States
bank
located in the United States and made by bank wire transfer or
bank check
in immediately available funds to such account as AltaRex shall
designate
before such payment is due.
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22
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6.6
|
Exchange Control.
If at any time legal restrictions prevent the prompt remittance
of part or
all royalties with respect to any country where the Product is
sold,
payment shall be made through such lawful means or methods as UP
reasonably shall determine after consultation with
AltaRex.
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ARTICLE
7
RIGHT
OF FIRST REFUSAL TO UP
|
7.1
|
Right
of First Refusal to UP.
AltaRex hereby grants to UP an exclusive right of first refusal
to enter
into an agreement concerning the license, development and/or
commercialization of new chemical entities, compounds, products,
or other
therapies owned or controlled by AltaRex which have application,
directly
or indirectly, in the treatment of cancer that are not included
within the
Licensed Technology (a “New Compound”).
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7.1.1
|
AltaRex
shall, via written notice, inform UP of any New Compound and provide
UP
with terms and conditions for an agreement (which may be a detailed
term
sheet) and UP shall have thirty (30) days from the date of its
receipt of
written notice from AltaRex to exercise its right of first refusal
granted
hereby by notifying AltaRex in writing of such exercise and to
commence
negotiations to enter into an agreement with AltaRex. In the event
the
parties cannot execute an agreement within thirty (30) days of
UP
exercising such right of first refusal, AltaRex may commence discussions
with Third Parties to enter into an arrangement with such Third
Parties;
provided, however, AltaRex shall not grant terms any more favorable
to the
terms offered by AltaRex to UP. Should UP fail to provide a written
notice
to AltaRex indicating whether or not it intends to exercise its
right of
first refusal within such thirty (30) day period or declines to
exercise
UP’s right of first refusal, UP shall be deemed to have declined to
exercise UP’s right of first refusal granted pursuant to Section
7.1.
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ARTICLE
8
CONFIDENTIALITY
|
8.1
|
Confidential Information.
As used herein, “Confidential Information”
means all Information relating to the Initial Assessment Period,
the UP
Development Program or the AltaRex Development Program for each
Product or
product, respectively, all Information that the parties have disclosed
to
each other since October 22, 2001 and/or during the term
of this
Agreement and all Information deemed “Confidential Information” under this
Agreement, provided that Confidential Information (other than Information
relating to the Initial Assessment Period, the UP Development Program
or
the AltaRex Development Program) has been marked “Confidential” or
“Proprietary” or, if orally presented, is indicated before disclosure to
be confidential or proprietary. Except to the extent expressly
authorized
by this Agreement or otherwise agreed in writing by the parties,
each
party shall keep confidential and shall not publish or otherwise
disclose
any Confidential Information of the other party and shall not use
such
Confidential Information of the other party for any purpose not
authorized
by this Agreement.
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23
|
8.2
|
Exceptions.
Notwithstanding Section 8.1
above, “Confidential Information”
shall not include any Information that a party can demonstrate
by
competent written evidence:
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|
8.2.1
|
was
already known to such party, other than under an obligation of
confidentiality, at the time of disclosure by the other party or,
prior to
its creation or discovery
hereunder;
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|
8.2.2
|
was
generally available to the public or otherwise part of the public
domain
at the time of its disclosure to such
party;
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|
8.2.3
|
became
generally available to the public or otherwise part of the public
domain
after its disclosure and other than through any act or omission
of such
party;
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|
8.2.4
|
was
disclosed to such party, other than under an obligation of confidentiality
to a Third Party, by a Third Party who had no obligation to a party
not to
disclose such information to others;
or
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|
8.2.5
|
is
independently developed by such party without using any Confidential
Information of the other party.
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|
8.3
|
Permitted Disclosure.
Notwithstanding the limitations in this Section 8, each party may
disclose
Confidential Information to the extent such disclosure is reasonably
necessary in the following instances, but solely for the limited
purpose
of such necessity:
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|
8.3.1
|
prosecuting
or defending litigation;
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|
8.3.2
|
complying
with applicable governmental laws or regulations, including without
limitation, NASDAQ, TSE, SEC or Ontario Securities Commission disclosure
requirements, or valid court
orders;
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|
8.3.3
|
disclosure
to employees, consultants or agents, solely in furtherance of this
Agreement, provided that such individuals have agreed in writing
to be
bound by similar terms of confidentiality and non-use at least
equivalent
in scope to those set forth in this Section 8;
or
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|
8.3.4
|
general
information of a non-material nature regarding the general status
of the
Initial Assessment Period, the UP Development Program or the AltaRex
Development Program.
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24
Notwithstanding
the foregoing, in the event that a party is required to make a disclosure
of the
Confidential Information of the other party pursuant to subsections 8.3.1
and
8.3.2
above,
it will give prompt advance notice to the other party of such disclosure
and
shall use its best efforts to assist the other party in securing confidential
treatment of such information.
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8.4
|
Publicity.
The parties shall agree upon the text of a press release that will
be
distributed by AltaRex or UP in connection with this Agreement,
the
Initial Assessment Period, the UP Development Program, the AltaRex
Development Program, the Licensed Technology, or that describes
the nature
and scope of the collaboration including its aggregate value, such
approval not to be unreasonably delayed or withheld; provided however,
if
the parties have previously approved a press release, the approved
disclosure may be included or referenced in a subsequent release
of a
similar nature without prior approval of both parties, and provided
further that either may make any such disclosure as would be permitted
under Section 8.3
if
the disclosure contemplated by this Section 8.4
were Confidential Information, but only on the condition that the
party
seeking disclosure under Section 8.3
shall first make a good faith effort to provide such disclosure
to the
other party with sufficient time to review and comment on such
disclosure
before any disclosure under Section 8.3
is
made.
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|
8.5
|
Publication.
From time to time it may be to the mutual interest of the parties
to
publish articles relating to data generated or analyzed as a part
of this
Agreement. Neither party shall submit for written or oral publication
or
presentation any manuscript, abstract, writing, printed material
or the
like which includes data or any other information generated and
provided
solely by the other party without first obtaining the prior written
consent of the other party, which consent shall not be unreasonably
withheld or delayed, provided however, that valid commercial reasons
may
exist for withholding such consent. Nothing contained herein shall
be
construed as precluding either party from making, in its discretion,
any
disclosures of information of any type which relate to the safety,
efficacy, toxicology, or pharmacokinetic characteristics of the
Products
to the extent that either party may be required by law to make
disclosures
of such information.
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|
8.6
|
Terms
of the Agreement.
The terms of this Agreement are deemed to be Confidential Information,
subject to Section 8.3
above; provided however, each party shall be free to disclose the
terms of
the Agreement to potential investors, financial institutions, licensors,
licensees and consultants provided such disclosures are subject
to no less
restrictive terms of confidentiality than as are set forth in this
Agreement.
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|
8.7
|
Survival.
The provisions of this Section 8 shall survive for five (5) years
after
the termination or expiration of this
Agreement.
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25
ARTICLE
9
INTELLECTUAL
PROPERTY RIGHTS
|
9.1
|
Ownership
of Joint Intellectual Property.
All Joint Intellectual Property shall be initially owned by AltaRex
and UP
shall sign whatever assignment papers are necessary to effectuate
this
ownership. After the filing of any patent application covering
Joint
Intellectual Property, the Advisory Committee shall determine whether
there is a material intellectual property advantage to keeping
the
application assigned to AltaRex. If the determination made is that
there
is no such advantage, AltaRex shall assign an undivided one-half
interest
in such patent application to UP and the patent application shall
be
jointly owned by the parties. Each party promptly shall disclose
to the
other party the making, conception or reduction to practice of
Joint
Intellectual Property by its employees or others acting on its
behalf.
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9.2
|
Filing,
Prosecution and Maintenance of Joint Intellectual
Property.
|
|
9.2.1
|
UP
shall, using commercially reasonable practices, control the preparation,
filing, prosecution, grant and maintenance of patent rights regarding
Joint Intellectual Property in the Territory, with the exception
of the
Joint Intellectual Property licensed to AltaRex in Section 3.4
herein, and shall select all patent counsel or other professionals
to
advise, represent or act for it in all matters relating to the
prosecution
and maintenance of such patent rights regarding Joint Intellectual
Property in the Territory. UP shall bear all costs incurred in
connection
therewith. UP shall inform AltaRex at regular intervals, or on
request,
about the status of Joint Intellectual Property for which it is
responsible and shall promptly provide AltaRex with copies of any
substantive official communications from United States and foreign
patent
offices relating to said prosecution, as well as drafts and copies
as
filed of relevant substantive communications to the various patent
offices
including drafts of the patent application to be filed. UP shall
reasonably consider any recommendations provided by AltaRex regarding
the
filing and/or prosecution of such patents covering Joint Intellectual
Property, but the final decision as to the filing and/or prosecution
matters shall rest with UP.
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|
9.2.2
|
In
the event that UP elects not to file a patent application or decides
to
abandon any pending application or granted patent under the Joint
Intellectual Property in any county, it shall provide adequate
notice to
AltaRex and give AltaRex the opportunity to file or maintain such
application or patent at its own expense; provided, however, that
except
for the right to file and maintain such patent rights, the ownership
rights of AltaRex and UP to such patent rights shall not be affected
by
reason of this Section 9.2.2.
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|
9.2.3
|
AltaRex
shall, using commercially reasonable practices, control the preparation,
filing, prosecution, grant and maintenance of patent rights regarding
Joint Intellectual Property outside the Territory, as well as the
Joint
Intellectual Property licensed to AltaRex in Section 3.4
herein and shall select all patent counsel or other professionals
to
advise, represent or act for it in all matters relating to the
prosecution
and maintenance of such patent rights regarding Joint Intellectual
Property in the Territory. AltaRex shall bear all costs incurred
in
connection therewith. AltaRex shall inform UP at regular intervals,
or on
request, about the status of Joint Intellectual Property for which
it is
responsible and shall promptly provide UP with copies of any substantive
official communications from United States and foreign patent offices
relating to said prosecution, as well as drafts and copies as filed
of
relevant substantive communications to the various patent offices
including drafts of the patent application to be filed. AltaRex
shall
reasonably consider any recommendations provided by UP regarding
the
filing and/or prosecution of such patents covering Joint Intellectual
Property, but the final decision as to the filing and/or prosecution
matters shall rest with AltaRex.
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26
|
9.2.4
|
In
the event that AltaRex elects not to file a patent application
or decides
to abandon any pending application or granted patent under the
Joint
Intellectual Property in any county, it shall provide adequate
notice to
UP and give UP the opportunity to file or maintain such application
or
patent at its own expense; provided, however, that except for the
right to
file and maintain such patent rights, the ownership rights of AltaRex
and
UP to such patent rights shall not be affected by reason of this
Section
9.2.4.
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|
9.3
|
Cooperation.
Each party shall make available to the other party or its authorized
attorneys, agents, consultants or representatives, if available,
such
information necessary or appropriate to enable the appropriate
party (at
the appropriate party’s cost and expense) to prepare, file, prosecute and
maintain patent applications and resulting patents with respect
to Joint
Intellectual Property as set forth in Section 9.2
above, for a period of time reasonably sufficient for such party
to obtain
the assistance it needs from such personnel. Where appropriate,
each party
shall sign or cause to have signed all documents relating to said
patent
applications or patents at no charge to the other.
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|
9.4
|
Filing
Prosecution and Maintenance of Patents.
|
|
9.4.1
|
AltaRex
will be responsible for prosecuting and maintaining the Patents
in the
Territory except as provided below in 9.4.6.
AltaRex shall promptly forward to UP’s patent counsel any substantive
actions prepared for or received from the U.S. Patent and Trademark
Office
or any foreign patent office which may materially affect patent
rights
within the Territory, e.g., claim scope or patent term. UP’s patent
counsel shall provide any comments to AltaRex in sufficient time
for
AltaRex to reflect such comments in any response. Any comments
made by UP
shall be made in good faith and shall be directed to maximizing
the claims
covered by such Patents.
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27
|
9.4.2
|
If
AltaRex agrees with the comments of UP’s patent counsel, it shall reflect
such comments in its response. If AltaRex disagrees with such comments,
it
shall notify UP, and either party may then submit such dispute
(a
“Patent Comment Dispute”)
for resolution by an intellectual property lawyer (the “Neutral Lawyer”)
with at least five years of experience and a background in biotechnology
or pharmaceutical patent matters. The Neutral Lawyer shall be selected
by
mutual agreement of the parties; provided, however, that if the
parties
cannot agree on a Neutral Lawyer within five days of a party’s request for
a Neutral Lawyer under this provision, the Neutral Lawyer shall
be
selected by the American Arbitration Association in Washington,
D.C. Each
party shall submit its position as to the Patent Comment Dispute
to the
Neutral Lawyer, who shall resolve the dispute by agreeing to one
of the
submitted positions of the parties without any changes to such
position.
The parties agree that the position agreed to by the Neutral Lawyer
shall
be reflected in the action or response being prepared and that
the costs
of the Neutral Lawyer shall be paid by the party whose position
is not
agreed to by the Neutral Lawyer. The decision of the Neutral Lawyer
shall
be final and binding on the parties. The Parties shall cooperate
in all
respects to resolve any Patent Comment Dispute in sufficient time
to avoid
any loss of rights, including without limitation jointly instructing
the
Neutral Lawyer to make a decision in sufficient time to avoid any
loss of
rights.
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|
9.4.3
|
UP
will be responsible for and pay fifty percent (50%) of AltaRex’s costs
incurred in prosecuting and maintaining such Patents net of amounts
paid
to AltaRex for such costs by other licensees, if any, for costs
incurred
after the Effective Date of any patent application which contains
at least
one claim covering a Licensed Product. AltaRex shall direct its
counsel to
invoice UP directly for UP’s share of such costs as such costs are
incurred with respect to prosecuting and maintaining such
Patents.
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|
9.4.4
|
Joint
Patent Committee. AltaRex and UP will, within sixty (60) days after
the
execution of this Agreement, establish a committee (the “Joint Patent Committee”)
consisting of three representatives of each party. The Joint Patent
Committee shall confer twice each calendar year or as necessary
to support
timely decision making during the term of this Agreement to discuss
patent
prosecution issues, budgets and strategies relating to the
Patents.
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|
9.4.5
|
The
provisions set forth in this Section 9.4
shall not apply to Joint Intellectual Property which provisions
governing
maintenance and prosecution are set forth above in Section 9.3.
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|
9.4.6
|
Notwithstanding
the foregoing provisions, if no claim covering all Licensed Products
is
indicated allowable following the next response in U.S. Serial
No.
09/152,698 (in which a response is currently due on May 28,
2002),
then UP shall be permitted to file a U.S. divisional application
for the
purpose of seeking an expedited allowance of a group of claims
covering
Licensed Products, provided that AltaRex is given a draft set of
claims
for such divisional application and an opportunity to comment thereon
before such divisional application is filed. With respect to said
divisional application, the counsel of UP’s choice shall be permitted to
take the lead in filing and prosecuting the application, including
filing
papers and conducting interviews with the examiner, provided that
each
action is discussed in advance with and consented to by AltaRex.
If there
is a dispute concerning any proposed action in the divisional,
it shall be
resolved as set forth above in 9.4.2.
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28
|
9.5
|
Infringement
of Patents and Joint Intellectual Property.
If either party becomes aware that a Third Party is infringing
any rights
in the Licensed Technology, such party shall give written notice
to the
other party describing in detail the nature of such infringement.
UP, in
the case of Joint Intellectual Property and AltaRex, in the case
of
Patents and Improvements in the Territory (the “Enforcing Party”), shall
have the first right to enforce such patent rights against infringers,
and
to consult with the other party both prior to and during such
enforcement.
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|
9.5.1
|
The
Enforcing Party shall have 120 days from the date of receipt of
notice
under this Section 9.5
to
xxxxx the infringement, or to file suit against at least one of
the
infringers, at its sole expense, following consultation with the
other
party; provided however, that within thirty (30) days after receipt
of
notice from the party whose patent rights allegedly are being infringed
of
its intent to file such suit, the other party shall have the right
to fund
up to one-half (1/2) of the costs of such a
suit.
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|
9.5.2
|
If
the Enforcing Party does not within 120 days of receipt of such
a notice,
xxxxx the infringement or file suit to enforce the patent rights
against
at least one infringing party in a country, the other party shall
have the
right to take whatever action it deems appropriate in its own name
or, if
required by law, in the name of the party whose patent rights allegedly
are being infringed, to enforce the patent
rights.
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|
9.5.3
|
The
party controlling the action may not settle the action or otherwise
consent to an adverse judgment in such action that diminishes the
rights
or interests of the non-controlling party without the express written
consent of the non-controlling party. All monies recovered upon
the final
judgment or settlement of any such suit shall be shared, after
reimbursement of the costs of participating in such action, by
AltaRex and
UP pro rata
according to the respective percentages of costs borne by each
party in
such suit pursuant to this Section 9.5.
Notwithstanding the foregoing, AltaRex and UP shall fully cooperate
with
each other in the planning and execution of any action to enforce
the
patent rights and provide all reasonable assistance to the other
party.
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|
9.6
|
Infringement
Actions by Third Parties.
In the event that a Third Party files an action against a party,
its
Affiliates, distributors or sublicensees alleging that such party’s or its
Affiliates’, distributors’ or sublicensees’ activities under this
Agreement infringe such Third Party’s patent or other intellectual
property rights, such party shall give written notice to the other
party,
and the parties will consult and cooperate on the best course of
action.
If the alleged infringing process, method or composition is claimed
under
the Licensed Technology in the Territory, UP shall have the right,
in its
sole discretion, to control the defense of such suit at its own
expense,
in which event AltaRex shall have the right to be represented by
advisory
counsel of its own selection, at its own expense, and shall cooperate
fully in the defense of such suit and furnish to UP all evidence
and
assistance in its control. If UP does not elect within thirty (30)
days
after such notice to so control the defense of such suit, AltaRex
may
undertake such control at its own expense, and UP shall then have
the
right to be represented by advisory counsel of its own selection,
at its
own expense, and UP shall cooperate fully in the defense of such
suit and
furnish to AltaRex all evidence and assistance in UP’s control. The party
controlling the suit may not settle the suit or otherwise consent
to an
adverse judgment in such suit that diminishes the rights or interests
of
the non-controlling party without the express written consent of
the
non-controlling party. Any judgments, settlements or damages payable
with
respect to legal proceedings covered by this Section 9.6
shall be paid by the party which controls the litigation, subject
to the
other party’s indemnification obligations under Article
10
below.
|
29
ARTICLE
10
INDEMNIFICATION
AND INSURANCE
|
10.1
|
Indemnity.
|
|
10.1.1
|
By
AltaRex.
Subject to UP’s compliance with Section 10.2,
AltaRex hereby agrees to indemnify, defend and hold harmless UP
and its
directors, officers, employees and agents, and hereby forever releases
and
discharges UP, from and against any and all liabilities, damages,
judgments, awards or costs of defense (including without limitation
reasonable attorneys’ fees, expenses to defend and amounts paid in
settlement of any action) (collectively, “Losses”) resulting from all
Third Party claims, demands, actions and other proceedings resulting
directly or indirectly from AltaRex’s breach of any of its covenants or
representations and warranties hereunder, or AltaRex’s negligence or
wrongdoing, but only to the extent that such Losses do not result
from
UP’s breach of any of its covenants or representations and warranties
hereunder or UP’s negligence or
wrongdoing.
|
|
10.1.2
|
By
UP.
Subject to AltaRex’s compliance with Section 10.2,
UP hereby agrees to indemnify, defend and hold harmless AltaRex
and its
directors, officers, employees and agents, and hereby forever releases
and
discharges AltaRex, from and against any and all liabilities, damages,
judgments, awards or costs of defense (including without limitation
reasonable attorneys’ fees, expenses to defend and amounts paid in
settlement of any action) (collectively, “Losses”)
resulting from all Third Party claims, demands, actions and other
proceedings, including but not limited to bodily harm, injury or
death,
resulting directly or indirectly from UP’s breach of any of its covenants
or representations and warranties hereunder, or UP’s negligence or
wrongdoing, but only to the extent that such Losses do not result
from
AltaRex’s breach of any of its covenants or representations and warranties
hereunder or AltaRex’s negligence or
wrongdoing.
|
|
10.2
|
Procedure.
In all cases where one party seeks indemnification by the other
under this
Section 10, the party seeking indemnification shall promptly notify
the
indemnifying party of receipt of any claim or lawsuit covered by
such
indemnification obligation and shall cooperate fully with the indemnifying
party in connection with the investigation and defense of such
claim or
lawsuit. The indemnifying party shall have the right to control
the
defense, with counsel of its choice, provided that the non-indemnifying
party shall have the right to be represented by advisory counsel
at its
own expense. The indemnifying party shall not settle or dispose
of the
matter in any manner, which could negatively and materially affect
the
rights or liability of the non-indemnifying party without the
non-indemnifying party’s prior written consent, which shall not be
unreasonably withheld or delayed.
|
30
|
10.3
|
Insurance.
Each party, at its own expense, shall maintain comprehensive general
liability insurance and clinical trial insurance coverage in amounts
reasonable and customary in the industry, but not less than $2,000,000
per
occurrence and $3,000,000 in the aggregate. UP shall purchase product
liability insurance with a reputable insurance company in amounts
reasonable and customary in the industry, prior to the first commercial
sale or distribution of Product and AltaRex shall be named in such
policy
as an additional insured party. Each party shall provide documentation
that such coverage exists upon request of the other party. Each
party
shall maintain such insurance for so long as it continues to research,
develop, manufacture, commercialize, and market Products, and thereafter
for so long as it customarily maintains insurance for itself covering
similar activities with its other similar
products.
|
ARTICLE
11
TERM
AND TERMINATION
|
11.1
|
Expiration
of Term.
The term of this Agreement shall commence upon the Effective Date
and
shall expire, unless earlier terminated as set forth in this Article
11,
upon the date of the last to expire payment obligation under this
Agreement. Prior to expiration, the parties shall agree upon the
surviving
rights and obligations of the parties and the disposition of any
Joint
Intellectual Property.
|
|
11.2
|
Termination
for Cause.
|
|
11.2.1
|
Except
as provided elsewhere in this Agreement, either party may terminate
this
Agreement in its discretion and in writing to the other party following
a
Material Breach of this Agreement by the other party it such party
has not
cured such breach within one hundred twenty (120) days after the
non-breaching party has provided written notice describing the
breach. The
term “Material Breach”
includes, without limitation, a party’s gross negligence, failure to
perform or comply with the material provisions of this Agreement,
omission, material misrepresentation or fraud related in any manner
to the
Initial Assessment Period, the UP Development Program or the
Products.
|
31
|
11.2.2
|
In
the event that United Therapeutics does not exercise the warrant
acquired
by it pursuant to the Subscription and Debenture Purchase Agreement
dated
as of the date hereof between AltaRex and United Therapeutics (the
“Subscription Agreement”)
on or prior to August 20, 2002 or does not purchase the
Second
Debenture (as defined in the Subscription Agreement) on or prior
to
August 25, 0000, XxxxXxx may terminate this Agreement immediately
upon written notice to UP.
|
|
11.3
|
Regulatory
and Material Adverse Change.
UP may terminate this Agreement, on a Product by Product basis,
in its
sole option at any time upon written notice to AltaRex and after
consultation with AltaRex in the event that (zz)
there is a reasonable basis upon which to conclude that the safety
of
human subjects is at risk from such Product; or (aaa)
there is a reasonable basis upon which to conclude that the efficacy
of
such Product may not reasonably be capable of demonstration; or
(bbb)
there is a reasonable basis upon which to conclude that such Product
may
not be timely and affordably manufactured in accordance with U.S.
“Good
Manufacturing Practices” and with an auditable quality system for the
manufacturing process; or (ccc)
if
the parties learn that a Third Party has rights to intellectual
property
that would prevent commercialization of such Product and negotiations
to
obtain a necessary license from such Third Party are unsuccessful;
or
(ddd)
there is a reasonable basis upon which to conclude that the estimated
costs to develop and commercialize such Product are prohibitive;
or
(eee)
after conducting appropriate due diligence, UP reasonably determines
that
a Product will not achieve the contemplated regulatory approval
under the
UP Development Program, through no fault of UP. Upon such termination
by
UP, all rights and licenses to the Licensed Technology granted
by AltaRex
under this Agreement with respect to such discontinued Products
shall
terminate and revert to AltaRex with no compensation due to UP
and UP
shall grant AltaRex a perpetual, royalty-free, irrevocable right
to use
(for any purpose) all Data generated by UP under this Agreement
regarding
such terminated Product.
|
|
11.4
|
Termination by UP.
|
|
11.4.1
|
UP
shall have the right to immediately terminate this Agreement in
its sole
discretion upon written notice to AltaRex, which termination shall
be
effective as of one hundred twenty (120) days after the date of
such
notice is received or on such later date as UP may specify in such
notice.
|
|
11.4.2
|
Upon
such termination by UP pursuant to Section 11.4.1,
termination by UP pursuant to Section 4.1.5,
or by AltaRex pursuant to Sections 4.1.5,
4.2.2
or
11.2,
all rights and licenses to the Licensed Technology granted by AltaRex
under this Agreement shall terminate and revert to AltaRex, UP
shall grant
AltaRex a perpetual, royalty-free, irrevocable right to use (for
any
purpose) all Data generated by UP under this Agreement; and UP
shall, free
of charge and with no limitation, perpetually and irrevocably assign
all
rights, title and interest that UP has in the Joint Intellectual
Property
to AltaRex.
|
32
|
11.4.3
|
Following
notice of termination, by UP or AltaRex hereunder, UP shall work
closely
with AltaRex to efficiently transition to or at the direction of
AltaRex
such Initial Assessment Period or UP Development Program activities
as
AltaRex may reasonably request.
|
|
11.5
|
Bankruptcy.
|
|
11.5.1
|
In
the event of the institution by or against either party of insolvency,
receivership, bankruptcy proceedings, or any other proceedings
for the
settlement of a party’s debts which are not dismissed within sixty (60)
days, or upon a party’s making an assignment for the benefit of creditors,
or upon a party’s dissolution or ceasing to do business, the other party
may terminate this Agreement upon written
notice.
|
|
11.5.2
|
All
rights and licenses granted under or pursuant to this Agreement
are, and
shall otherwise be deemed to be, for purposes of Section 365(n)
of the
U.S. Bankruptcy Code, licenses of rights to “intellectual property” as
defined under Section 101 of the U.S. Bankruptcy Code. The
parties
agree that each, as a licensee of certain rights under this Agreement,
shall retain and may fully exercise all of their rights and elections
under the U.S. Bankruptcy Code; provided however, nothing herein
shall be
deemed to constitute a present exercise of such rights and elections.
The
parties further agree that, in the event of the commencement of
a
bankruptcy proceeding by or against a party under the U.S. Bankruptcy
Code, the other party shall be entitled to a complete duplicate
of (or
complete access to, as appropriate) any such intellectual property
and all
embodiments of such intellectual property, and same, if not already
in its
possession, shall be promptly delivered to such party (i)
upon any such commencement of a bankruptcy proceeding upon their
written
request therefore, unless the bankrupt party elects to continue
to perform
all of its obligations under this Agreement, or (ii)
if
not delivered under (a) above, upon rejection of this Agreement
by or on
behalf of the bankrupt party upon written request therefore by
the
non-bankrupt party.
|
|
11.6
|
Effect
of Expiration or Termination.
|
|
11.6.1
|
Upon
expiration of termination of this Agreement for any reason, each
party
shall promptly return all of the other party’s materials, documents and
Information related to the Initial Assessment Period, the UP Development
Program or the AltaRex Development Program and otherwise created
hereunder, and all Confidential Information of the other party;
provided
however, each party may retain one copy of each document of the
other
party’s Confidential Information to enable such party to determine its
surviving obligations of confidentiality and non-use with respect
to the
other party’s Confidential
Information.
|
|
11.6.2
|
Except
in the case of a termination of this Agreement (fff)
by
AltaRex owing to a material breach of this Agreement by UP, or
(ggg)
in
connection with a Product’s infringement on the intellectual property
rights of a Third Party, upon any termination of this Agreement,
UP shall
have the right and option to sell any remaining UP inventories
of Product
pursuant to the terms and conditions of this
Agreement.
|
33
|
11.7
|
Survival.
The following provisions shall survive termination or expiration
of this
Agreement: Articles 1, 2, 8 (for five years), 10, 11 and 12, and
Sections
4.2.1
(with respect to the registration name for regulatory filings)
and
9.1.
Termination or expiration of this Agreement shall not relieve either
party
of any liability that accrued hereunder prior to the effective
date of
such termination, nor preclude either party from pursuing all rights
and
remedies it may have hereunder or at law or in equity with respect
to any
breach of this Agreement, nor prejudice either party’s right to obtain
performance of any obligation.
|
ARTICLE
12
MISCELLANEOUS
|
12.1
|
Entire
Agreement; Amendment.
This Agreement sets forth the complete, final and exclusive agreement
between the parties with respect to the subject matter hereof,
and all of
the covenants, promises, agreements, warranties, representations,
conditions and understandings between the parties hereto with respect
to
such subject matter, and supersedes and terminates all prior agreements
and understandings between the parties with respect to such subject
matter, including without limitation that certain Confidential
Disclosure
Agreement, dated as of October 22, 2001. There are no covenants,
promises, agreements, warranties, representations, conditions or
understandings, either oral or written, between the parties with
respect
to such subject matter other than as are set forth herein and therein.
No
subsequent extension, termination, alteration, amendment, modification,
change, addition to or waiver of this Agreement shall be binding
upon the
parties unless reduced to writing and signed by an authorized officer
of
each party.
|
|
12.2
|
Dispute Resolution.
The parties agree to consult and negotiate in good faith to try
to resolve
any dispute, controversy or claim that arises out of or relates
to this
Agreement. In the event of any controversy or claim arising out
of,
relating to or in connection with the Initial Assessment Period,
the UP
Development Program or any other provision of this Agreement, or
the
rights or obligations of the parties hereunder, the parties shall
try to
settle their differences amicably between themselves by referring
the
disputed matter to the Chief Executive Officer of AltaRex and the
Chief
Executive Officer of United Therapeutics Corporation for discussion
and
resolution. Either party may initiate such informal dispute resolution
by
sending written notice of the dispute to the other party, and within
ten
(10) days of such notice the Chief Executive Officer of AltaRex
and the
Chief Executive Officer of United Therapeutics Corporation shall
meet for
attempted resolution by good faith negotiations. If such executives
are
unable to resolve such dispute within thirty (30) days of initiating
such
negotiations, each party may thereafter pursue any and all rights
and
remedies it may have at law or equity. The foregoing dispute resolutions
provisions shall not apply to any disputes, controversies or claims
arising under Article 8 (Confidentiality) and Article
10
(indemnification and Insurance).
|
34
|
12.3
|
Force Majeure.
Both parties shall be excused from the performance of their obligations
under this Agreement to the extent that such performance is prevented
by
force majeure and the non-performing party promptly provides notice
of the
prevention to the other party. Such excuse shall be continued so
long as
the condition constituting force majeure continues and the non-performing
party takes reasonable efforts to remove the condition. For purposes
of
this Agreement, “force majeure” shall include conditions beyond the
control of the parties, including without limitation, an act of
God, war,
civil commotion, labor strike or lock-out, epidemic, failure or
default of
public utilities or common carriers, destruction of production
facilities
or materials by fire, earthquake, storm or like
catastrophe.
|
|
12.4
|
Notices.
Any consent, notice or report required or permitted to be given
under this
Agreement shall be in writing, shall specifically refer to this
Agreement
and shall be deemed to have been sufficiently given for all purposes
if
mailed by first class certified or registered mail, postage prepaid,
express delivery service or personally delivered, or if sent by
facsimile
and confirmed through one of the foregoing methods. Unless otherwise
specified in writing, the mailing addresses of the parties shall
be as
described below.
|
|
FOR
ALTAREX:
|
AltaRex
Corp.
000
Xxxxxxx Xxxxxx
Xxxxxxx,
Xxxxxxxxxxxxx 00000
Fax:
(000) 000-0000
Attention:
President
|
|
With
a copy to:
Xxxx
and Xxxx LLP
00
Xxxxx Xxxxxx
Xxxxxx,
Xxxxxxxxxxxxx 00000
Attention:
Xxxxxx X. Xxxxxx, Esq.
Facsimile
No.: (000) 000-0000
|
|
|
FOR
UP:
|
Unither
Pharmaceuticals, Inc.
0000
Xxxxxx Xxxxxx
Xxxxxx
Xxxxxx, Xxxxxxxx 00000
Attention:
Xxxxxxx Xxxxxxxxx, CEO
Fax
Number: (000) 000-0000
|
|
With
a copy to:
Unither
Pharmaceuticals, Inc.
0000
Xxxxxxxxxxx Xxxxxx, X.X.
Xxxxxxxxxx,
X.X. 00000
Attention:
Xxxx X. Xxxxx, General Counsel
Fax
Number: (000) 000-0000
|
35
|
12.5
|
Limitation
of Liability.
In no event will either party be liable to the other party for
any
indirect, collateral, consequential, special or punitive damages
or for
any lost profits of the other party, however caused and on any
theory of
liability, arising out of the performance or failure to perform
any
obligations set forth herein, except for those damages caused by
a party’s
gross negligence or willful
malfeasance.
|
|
12.6
|
Consents
Not Unreasonably Withheld or Delayed.
Whenever provision is made in this Agreement for either party to
secure
the consent or approval of the other, that consent or approval
shall not
unreasonably be withheld or delayed, and whenever in this Agreement
provisions are made for one party to object to or disapprove a
matter,
such objection or disapproval shall not unreasonably be exercised,
unless
expressly stated that such consent is to be given in such party’s
discretion.
|
|
12.7
|
Independent Contractors.
The status of the parties under this Agreement shall be that of
independent contractors. Neither party shall have the right to
enter into
any agreements on behalf of the other party, nor shall it represent
to any
person that it has any such right or authority. Nothing in this
Agreement
shall be construed as establishing a partnership or joint venture
relationship between the parties.
|
|
12.8
|
Maintenance
of Records.
Each party shall keep and maintain all records required by law
or
regulation with respect to development of a Product and shall make
copies
of such records available to the other party upon
request.
|
|
12.9
|
United
States Dollars.
References in this Agreement to “Dollars” or “$” shall mean the legal
tender of the United States of
America.
|
|
12.10
|
Assignment.
Neither party to this Agreement may assign or transfer this Agreement
or
any rights or obligations hereunder without the prior written consent
of
the other party. Notwithstanding the foregoing, either party may
assign or
transfer this Agreement to a successor of a controlling interest
of such
party. Any permitted successor or assignee of rights and/or obligations
hereunder shall, in writing to the other party, expressly assume
performance of such rights and/or obligations. This Agreement shall
be
binding upon and shall inure to the benefit of each party’s permitted
successors-in-interest and permitted assigns. Any assignment or
attempted
assignment by either party in violation of the terms of this Section
12.10
shall be null and void and of no legal
effect.
|
36
|
12.11
|
Counterparts.
This Agreement may be executed in two or more counterparts, each
of which
shall be deemed an original, but all of which together shall constitute
one and the same instrument.
|
|
12.12
|
Further
Actions.
Each party agrees to execute, acknowledge and deliver such further
instruments, and to do all such other acts, as may be necessary
or
appropriate in order to carry out the purposes and intent of this
Agreement.
|
|
12.13
|
Severability.
If any one or more of the provisions of this Agreement is held
to be
invalid or unenforceable, the provision shall be considered severed
from
this Agreement and shall not serve to invalidate any remaining
provisions
hereof. The parties shall make a good faith effort to replace any
invalid
or unenforceable provision with a valid and enforceable one such
that the
objectives contemplated by the parties when entering this Agreement
may be
realized.
|
|
12.14
|
Construction.
The parties have participated jointly in the negotiation and drafting
of
this Agreement. In the event of an ambiguity or question of intent
or
interpretation arises, this Agreement shall be construed as if
drafted
jointly by the parties and no presumption or burden of proof shall
arise
favoring or disfavoring any party by virtue of the authorship of
any of
the provisions of this Agreement.
|
|
12.15
|
Headings.
The headings for each article and section in this Agreement have
been
inserted for convenience of reference only and are not intended
to limit
or expand on the meaning of the language contained in the particular
article or section.
|
|
12.16
|
No Waiver.
Any delay in enforcing a party’s rights under this Agreement or any waiver
as to a particular default or other matter shall not constitute
a waiver
of such party’s rights to the future enforcement of its rights under this
Agreement, excepting only as to an express written and signed waiver
as to
a particular matter for a particular period of
time.
|
|
12.17
|
Governing Law;
Jurisdiction and Venue.
This Agreement will be governed and construed in accordance with
the laws
of the State of Maryland. No lawsuit pertaining to any matter arising
under or growing out of this Agreement shall be instituted in any
jurisdiction other than in the courts located in the State of Maryland,
and the parties consent to exclusive jurisdiction before the federal
or
state courts of the State of
Maryland.
|
|
12.18
|
Legal Fees.
If any dispute arises between the parties with respect to the matters
covered by this Agreement which leads to a proceeding to resolve
such
dispute, the prevailing party in such proceeding shall be entitled
to
receive its reasonable attorneys’ fees, expert witness fees and
out-of-pocket costs incurred in connection with such proceeding,
in
addition to any other relief it may be
awarded.
|
37
|
12.19
|
Injunctive Relief.
A
breach of any of the promises or agreements contained in this Agreement
may result in irreparable and continuing damage to a party for
which there
may be no adequate remedy at law, and each party is therefore entitled
to
seek injunctive relief as well as such other and further relief
as may be
appropriate. The obligations provided under Section 8 of this Agreement
are acknowledged as necessary and reasonable in order to protect
each
party and its business, and the parties expressly agree that monetary
damages would be inadequate to compensate either party for the
breach
thereof. Accordingly, each party agrees and acknowledges that any
such
violation or threatened violation will cause irreparable injury
to the
other party and that, in addition to any other remedies that may
be
available, in law, in equity or otherwise, each party shall be
entitled to
obtain injunctive relief against the breach or threatened breach
by the
other party of Section 8, without the necessity of proving actual
damages.
|
|
12.20
|
Contemporaneous
Agreements.
This Agreement is being executed contemporaneously with the Loan
Agreement
and the Subscription Agreement between United Therapeutics Corporation
and
AltaRex Corp. and this Agreement shall have no force and effect
unless all
such documents are contemporaneously
executed.
|
IN
WITNESS WHEREOF, the parties have executed this Agreement by their authorized
officers of the date and year first above written.
|
ALTAREX
CORP.
|
UNITHER
PHARMACEUTICALS, INC.
|
|
|
(signed)
“Xxxxxxx X. Xxxxxx”
|
(signed)
“Xxxx X. Xxxxx”
|
|
|
Xxxxxxx
X. Xxxxxx
President
and CEO
|
Xxxx
X. Xxxxx
Senior
Vice President and General
Counsel
|
United
Therapeutics Corporation hereby agrees and acknowledges that it shall be
fully
responsible and liable for the acts and omissions of its wholly owned
subsidiary, Unither Pharmaceuticals, Inc. and any respective Affiliate or
subsidiary of United Therapeutics Corporation or Unither Pharmaceuticals,
Inc.
under this Agreement.
|
UNITED
THERAPEUTICS CORPORATION
|
|
|
(signed)
“Xxxx X. Xxxxx”
|
|
|
Xxxx
X. Xxxxx
Senior
Vice President and General
Counsel
|
38
APPENDIX
A
PATENTS
AND PATENT APPLICATIONS
|
Country
|
File
Date
|
Serial
Number
|
Patent
Number
|
Issue
Date
|
|
Therapeutic
composition that produce an immune response
Altered Immunogenicity
|
||||
|
South
Africa
|
11/10/98
|
9810275
|
98/10275
|
8/30/00
|
|
USA
|
9/2/98
|
09/152,698
|
||
|
Australia
|
6/15/99
|
41593/99
|
||
|
Canada
|
11/4/98
|
2,253,058
|
||
|
Canada
|
6/15/99
|
2,333,221
|
||
|
Europe
|
6/15/99
|
99925215.8
|
||
|
Israel
|
6/15/99
|
000000
|
||
|
Xxxxx
|
6/15/00
|
0000-000000
|
||
|
PCT
|
6/15/99
|
PCT/IB99/01114
|
||
|
USA
|
8/18/99
|
09/376,604
|
||
|
PCT
|
3/21/01
|
Pending
5
|
||
|
Therapeutic
Binding Agents against MUC-1 antigen and methods of their
use
BrevaRex
|
||||
|
Israel
|
8/18/99
|
148165
|
||
|
Australia
|
8/18/99
|
Pending
|
||
|
Canada
|
8/18/99
|
Pending
Serial N. designation of PCT application
PCT/US00/22890
|
||
|
Japan
|
8/18/99
|
Pending
|
||
|
Europe
|
8/18/99
|
Pending
|
||
|
PCT
|
8/18/00
|
PCT/US00/22890
|
||
|
USA
|
8/18/00
|
09/641,833
|
||
|
USA
|
11/26/01
|
09/994,466
|
||
39
APPENDIX
A
PATENTS
AND PATENT APPLICATIONS
|
Country
|
File
Date
|
Serial
Number
|
Patent
Number
|
Issue
Date
|
||||
|
Cancer
Therapeutics
Cancer
Therapeutics
|
||||||||
|
USA
|
1/17/02
|
Pending
3
|
||||||
|
Combination
Therapy for Treating Disease
Combination
Therapy
|
||||||||
|
USA
|
10/26/01
|
Pending
|
||||||
|
Therapeutic
method utilizing antigen-antibody complexation and
presentation
by
dendritic cells
Dendritic
Cells
|
||||||||
|
PCT
(in
vivo)
|
5/11/01
|
PCT/IB01/01331
|
||||||
|
USA
(in
vivo)
|
5/11/01
|
09/853,300
|
||||||
|
PCT
(ex
vivo)
|
5/11/01
|
XXX/XX00/00000
|
||||||
|
XXX
(ex
vivo)
|
5/11/01
|
09/853,268
|
||||||
|
Method
and Composition for Reconforming Multi-epitopic antigens to
initiate
an
immune response
Multi-epitopic
|
||||||||
|
Australia
|
5/15/96
|
56,580/96
|
711,270
|
1/20/00
|
||||
|
Brazil
|
5/15/96
|
XX0000000-1
|
||||||
|
Canada
|
5/15/96
|
2,253,602
|
||||||
|
China
|
5/15/96
|
96180297.9
|
||||||
|
Europe
|
5/15/96
|
96913660.5
|
||||||
|
Hong
Kong
|
5/15/96
|
99104783.5
|
||||||
|
Hungary
|
5/15/96
|
41,408/98
|
||||||
|
Israel
|
5/15/96
|
126803
|
||||||
40
APPENDIX
A
PATENTS
AND PATENT APPLICATIONS
|
Country
|
File
Date
|
Serial
Number
|
Patent
Number
|
Issue
Date
|
||||
|
Method
and Composition for Reconforming Multi-epitopic antigens to
initiate
an
immune response
Multi-epitopic
|
||||||||
|
Japan
|
5/15/96
|
540,681/1997
|
||||||
|
Japan
|
7/3/00
|
200,702/2000
|
||||||
|
South
Korea
|
5/15/96
|
709153/98
|
||||||
|
South
Korea
|
5/15/96
|
10-2001-7015189
|
||||||
|
Mexico
|
5/15/96
|
98
0000
|
||||||
|
Xxxxxx
|
5/15/96
|
985,304
|
||||||
|
New
Zealand
|
5/15/96
|
332588
|
332588
|
0/0/00
|
||||
|
Xxx
Xxxxxxx
|
0/00/00
|
000000
|
||||||
|
Xxx
Xxxxxxx
|
5/15/96
|
503032
|
||||||
|
New
Zealand
|
5/15/96
|
516264
|
||||||
|
PCT
|
5/15/96
|
PCT/IB96/00461
|
||||||
|
USA
|
5/15/96
|
08/913,290
|
6,241,985
|
6/5/01
|
||||
|
USA
|
5/31/01
|
09/871,339
|
||||||
|
Therapeutic
composition and method of treatment
Photoactivation
|
||||||||
|
Australia
|
6/16/98
|
81439/98
|
732,505
|
8/9/01
|
||||
|
Canada
|
6/16/98
|
2292912
|
||||||
|
Europe
|
6/16/98
|
00000000.2
|
||||||
|
Japan
|
6/16/98
|
504632/1999
|
||||||
|
PCT
|
6/16/98
|
XXX/XX00/00000
|
||||||
|
XXX
|
6/17/97
|
08/877,511
|
6,086,873
|
7/11/00
|
||||
|
USA
|
7/10/00
|
09/613163
|
||||||
41
APPENDIX
A
PATENTS
AND PATENT APPLICATIONS
|
Country
|
File
Date
|
Serial
Number
|
Patent
Number
|
Issue
Date
|
|
Immunotherapeutic
Composition and Method for the treatment of Prostate
ProstaRex
|
||||
|
Australia
|
6/15/99
|
41594/99
|
||
|
Canada
|
6/15/99
|
2,328,504
|
||
|
Europe
|
6/15/99
|
99925216.6
|
||
|
Israel
|
6/15/99
|
000000
|
||
|
Xxxxx
|
6/15/00
|
0000-000000
|
||
|
PCT
|
6/15/99
|
PCT/IB99/01115
|
||
|
USA
|
6/15/99
|
09/332,866
|
||
|
Therapeutic
Adjuvant
Therapeutic
Adjuvant
|
||||
|
USA
|
8/16/01
|
60/312,887
|
||
|
Therapeutic
Immune Condition Compositions and Methods
Anti-Inflammation
and Metastasis
|
||||
|
Australia
|
8/25/00
|
Pending
|
||
|
Israel
|
8/25/00
|
Pending
|
||
|
Europe
|
8/25/00
|
Pending
|
||
|
Japan
|
8/25/00
|
Pending
|
||
|
Canada
|
8/25/00
|
Pending
|
||
|
PCT
|
8/25/00
|
PCT/IB00/02077
|
||
|
USA
|
8/25/00
|
09/648,663
|
||
|
Method
for Diagnosing Efficacy of Xenotypic Antibody
Therapy
HAMA
|
||||
|
PCT
|
2/8/01
|
PCT/IB01/00423
|
||
|
USA
|
2/8/01
|
09/779,439
|
||
|
Binding
Agents and Their Use in Targeting Tumor Cells
Tumor
Cell Targeting
|
||||
|
USA
(Provisional)
|
4/11/02
|
Pending
|
||
00
XXXXXXXX
X
KNOW-HOW
All
Know-How from the Biomira Agreement licensed rights including, without
limitation, notebook data, biological and animal data, process information
and
tech transfer and any and all unpublished data in connection with the Biomira
Agreement licensed rights, to which AltaRex has a sublicensable
interest.
All
Know-How and unpublished data of AltaRex as it relates to the Patents, including
discoveries and all other proprietary information and analysis relating to
the
Prior Development Technology, Improvements and Information to which AltaRex
has
an ownership or a sublicensable interest.
43
APPENDIX
C
EXCLUDED
TERRITORIES
The
following are excluded from the Territory of this Agreement:
|
Dompé(1)
|
Genesis(2)
|
Medison(2)
|
|
Italy
|
Greece
|
Israel
|
|
Switzerland
|
Turkey
|
Egypt
|
|
Austria
|
Cyprus
|
Jordan
|
|
Spain
(Faes)
|
Croatia
|
Saudi
Arabia
|
|
Portugal
(Faes)
|
Bosnia
|
Yemen
|
|
San
Marino
|
Herzegovina
|
Oman
|
|
Ukraine
|
Macedonia
|
Iraq
|
|
Belarus
|
Serbia
|
Syria
|
|
Hungary
|
Slovenia
|
Qatar
|
|
Poland
|
Albania
|
Bahrain
|
|
Czech
Republic
|
Romania
|
Kuwait
|
|
Yugoslavia
|
Bulgaria
|
UAE
|
|
Lithuania
|
Iran
|
|
|
Estonia
|
Palestine
|
|
|
Latvia
|
Lebanon
|
(1)Dompé
has a Right of First Offer on BrevaRex® and ProstaRex™ for the same countries as
listed above upon the Products entering phase II study.
(2)Genesis
and Medison have a Right of First Offer on BrevaRex® for the same countries as
listed above upon the Product entering phase II study.
44
APPENDIX
D
PRELIMINARY
CORE DEVELOPMENT TEAM
|
Employee
Name
|
AltaRex
Title
|
Severance
(in Months)
|
Base
Salary Annual
|
Per
Pay Period
|
Severance
|
|||||||||||
|
Xxxxx,
Xxxxxx
|
Executive Assistant |
-
|
$
|
47,000
|
$
|
1,958
|
$
|
0
|
||||||||
|
Xxxxxxxxx,
Xxxxxxxxxxx
|
Xx. VP, Clinical Research & Development |
12
|
221,400
|
9,225
|
221,400
|
|||||||||||
|
Xxxxxxx,
Xxxxxx
|
QC Manager |
2
|
75,000
|
3,125
|
12,500
|
|||||||||||
|
Xxxx,
Xxxxx
|
QA Specialist |
-
|
42,000
|
1,750
|
-
|
|||||||||||
|
Xxxxxx,
Xxxxxx
|
Director, Cell Culture Manufacturing |
6
|
110,000
|
4,583
|
55,000
|
|||||||||||
|
Xxxxx,
Xxxxx
|
VP, Manufacturing & Development |
12
|
185,000
|
7,708
|
185,000
|
|||||||||||
|
Xxxxxx,
Xxxxxxx
|
Assoc. Director, Manufacturing |
2
|
85,000
|
3,542
|
14,167
|
|||||||||||
|
Xxxxxx,
Xxxxx
|
Director, Finished Product Manufacturing |
3
|
115,500
|
4,813
|
28,875
|
|||||||||||
|
Xxxxx,
Xxxxxxx
|
VP, Regulatory Affairs & Proj. Mgmt. |
6
|
185,000
|
7,708
|
92,500
|
|||||||||||
|
Xxxxxxx,
Xxxx
|
Xx. Manager, Regulatory Affairs |
2
|
95,000
|
3,958
|
15,833
|
|||||||||||
|
Xxxxxx,
Xxxxxxx
|
Clinical Res. Assoc., Safety Officer |
-
|
35,000
|
1,458
|
-
|
|||||||||||
|
Xxxxxx,
Xxxxxxxxx
|
Clinical Project Manager |
2
|
85,000
|
3,542
|
14,167
|
|||||||||||
|
Xxxxxxxxx,
Xxxxx
|
Controller |
3
|
95,000
|
3,958
|
23,750
|
|||||||||||
|
Xxxxx,
Xxxxx
|
Xx. VP, Operations |
12
|
195,000
|
8,125
|
195,000
|
|||||||||||
|
Xxxxxx,
Xxx
|
Executive Assistant |
-
|
47,600
|
1,983
|
-
|
|||||||||||
|
$
|
1,618,500
|
$
|
67,437
|
$
|
858,192
|
|||||||||||
|
%
cost of Benefits as related to Base Salary:
|
18.22
|
%
|
||||||||||||||
|
Benefit:
|
||||||||||||||||
|
Health
|
$
|
109,810
|
||||||||||||||
|
FICA
Match
|
91,395
|
|||||||||||||||
|
401(k)
Match
|
46,563
|
|||||||||||||||
|
Dental
|
28,389
|
|||||||||||||||
|
Life
|
8,351
|
|||||||||||||||
|
Long-term
|
9,145
|
|||||||||||||||
|
Disability
|
||||||||||||||||
|
Short-term
|
1,188
|
|||||||||||||||
|
Disability
|
||||||||||||||||
|
$
|
294,841
|
|||||||||||||||
Note:
This analysis does not include any vacation accruals, a timing difference
as
people take vacation.
45
|
Contracted
Personnel
|
AltaRex
Description
|
|
|
(no
benefits, etc.)
|
||
|
1. Xx.
Xxxxxx Xxxxxxx
|
Consulting
Medical Oncologist ($3,800/month until April 30, 2002
|
|
|
2. Veristat
(Xxxx Xxxxxx)
Biostatistics
|
Biometrics
and data management ($150/hr $90/hr Medical
Writing)
|
CLINICAL
ADVISORY BOARD AND SCIENTIFIC ADVISORY BOARD
Although
not directly part of the Core Development Team, the Company’s Clinical Advisory
Board directs its attention entirely to OvaRex®. AltaRex will terminate two (2)
members (DRS. Holland and Margolese) effective immediately following the
next
CAB meeting as ASCO in May, 2002. As of the Effective Date and in accordance
with the above, UP shall be responsible for Clinical Advisory Board expenses
and
payments.
| 1. |
Xx.
Xxxxx ($15,000/year)
|
| 2. |
Xx.
Xxxxx ($15,000/year)
|
| 3. |
Holland
($15,000/year)
|
| 4. |
Xx.
Xxxxxxxxx ($15,000/year)
|
| 5. |
Xx.
Xxx Xxxx ($1 5,000/year)
|
| 6. |
Xx.
Xxxxxxxxx ($2,000/day as needed)
|
00
XXXXXXXX
X
APPLICABLE
SECTIONS OF BIOMIRA AGREEMENT
ARTICLE
1
DEFINITIONS
| 1.1 |
Definitions
|
In
this
Agreement, unless otherwise provided, the following terms shall have the
following meanings:
|
(1)
|
“Affiliate”
has the meaning ascribed to that term in the Canada Business Corporations
Act (Canada);
|
|
(2)
|
“Agreement”
means this amended and restated license agreement, together with
any
further amendments to or restatements of this amended and restated
license
agreement;
|
|
(3)
|
“AltaRex
Information” means all information of a confidential nature of AltaRex or
any of its Affiliates including, without limiting the generality
of the
foregoing, all biological material, plant, animal and human laboratory
and
clinical data, technical information, Know-How, inventions, techniques,
processes, systems, formulae, results of experimentation, designs,
statistics and records;
|
|
(4)
|
“Anti-Idiotype
Applications” means the induction of anti-idiotype and/or cellular immune
response by administration of a formulation containing an antibody,
antibody fragment or antibody derivative for the treatment or prevention
of disease. Without limiting the generality of the foregoing,
Anti-Idiotype Applications specifically includes the administration
of the
X00 Xxxxxxxx for therapeutic or prophylactic
purposes;
|
| (5) |
“X00
Xxxxxxxx” means the murine antibody MAb
B43.13;
|
|
(6)
|
“B43
Working Cell Bank” means Biomira’s murine working hybridoma cell bank
B43.13 of the murine hybridoma clone B43.13 such cell bank being
produced
at the Xxxxxxx River Laboratories and used in the OVAREX™ program as of
November 24, 1995 (the effective date of the Original
Agreement);
|
|
(7)
|
“Biomira
Information” means all information of a confidential nature of Biomira or
any of its Affiliates including, without limiting the generality
of the
foregoing, all Biomira Technology, biological material, plant,
animal and
human, laboratory and clinical data, technical information, Know-How
inventions, techniques, processes, systems, formulae, results of
experimentation, designs, statistics and
records;
|
|
(8)
|
“Biomira
Technology” means all Know-How, technical expertise, information,
inventions and discoveries, whether patentable or not, and all
copyrights,
patents, trademarks, industrial designs, and other intellectual
property
rights or benefits made, authored, conceived, created, compiled
or
developed by or for, or acquired by Biomira or any of its
Affiliates;
|
47
|
(9)
|
“Confidential
Information” means any and all Biomira information or AltaRex Information,
as the case may be, and any and all information of a confidential
nature
relating to Biomira, Xxxx Xxx, the relationship among the parties
to this
Agreement and the terms and subject matter of this
Agreement;
|
|
(9)
|
“Data”
means, as of November 24, 1995 (the effective date of the Original
Agreement), the experimental and clinical data and records of Biomira
or
Biomira Research, Inc. relating to the X00 Xxxxxxxx, the B43 Working
Cell
Bank and the product OVAREX™ owned by Biomira or Biomira Research,
Inc.;
|
| (11) |
“Effective
Date” means December 1, 1995;
|
|
(12)
|
“First
Commercial Sale” means, on a country-by-country basis, the first
commercial sale of a Licensed Product in a country, excluding sales
for
clinical trial purposes;
|
|
(13)
|
“IPT”
means the use of an antibody to target a photodynamic effector
molecule to
a cell whereby the effector molecule kills the
cell;
|
|
(14)
|
“IRT”
means the use of an antibody to target a radioactive effector molecule
to
a cell whereby the effector molecule kills the
cell;
|
|
(15)
|
“Know-How”
means, with respect to AltaRex or Biomira as the case may~ be,
all
technical information, expertise, Know-How and information including
without limitation all data, results of experiments, formulae,
specifications, procedures, tests, compounds, cell lines, cultures,
constructs, effectors, development strains, micro-organisms, assay
systems, assay protocol and assay supporting material, fermentation
and
purification material and
techniques;
|
|
(16)
|
“Licensed
Product” means any product (including without limitation OVAREX™) based,
in whole or in part, on the Technology (which defined term, for
purposes
of this definition, shall include the B43 Antibody and any derivative
thereof);
|
|
(17)
|
“Multi-Epitopic
Patent Rights” means International Application PCT/IB96/00461 and any
national stage application claiming priority thereof, and any
continuations, divisionals, continuations-in-part thereof, and
any foreign
equivalents, and any patents issuing therefrom, including any reissues
thereof;
|
48
|
(18)
|
“Net
Sales Revenue” means the aggregate of the gross amounts received from all
sales, uses or other dispositions of Licensed Products by AltaRex
or any
Sublicensee after deducting (i) customary trade, cash and quantity
discounts actually allowed and taken, (ii) tariffs, duties, excises,
sales
tax or other taxes imposed upon and paid with respect to the production,
sale, delivery or use of any product (excluding income-based taxes),
and
(iii) amounts actually paid or credited to unrelated purchasers
in
accordance with normal commercial practice by reason of (A) rejections,
defects, recalls or returns, or (B) chargebacks, refunds, rebates
or
retroactive price reductions, and then crediting any refund of
taxes
deducted (all as determined in accordance with Canadian generally
accepted
accounting principles applied on a consistent basis). In the event
a
Licensed Product is sold as part of a Combination Product (as defined
below), the Net Sales Revenue from the Combination Product, for
the
purposes of determining royalty payments, shall be determined by
multiplying the Net Sales Revenue of the Combination Product (as
defined
in the foregoing Net Sales Revenue definition), during the applicable
royalty reporting period, by the fraction, A/A+B, where A is the
average
sale price of the Licensed Product when sold separately in finished
form
in the country in which the Combination Product is sold and B is
the
average sale price of the other pharmaceutical product(s) included
in the
Combination Product when sold separately in finished form in the
country
in which the Combination Product is sold, in each case during the
applicable royalty reporting period or, if sales of both the Licensed
Product and the other pharmaceutical product(s) did not occur in
such
period, then in the most recent royalty reporting period in which
sales of
both occurred. In the event that such average sale price cannot
be
determined for both the Licensed Product and all other pharmaceutical
products(s) included in the Combination Product, Net Sales Revenue
for the
purposes of determining royalty payments shall be calculated by
multiplying the Net Sales Revenue of the Combination Product by
the
fraction of C/C+D where C is the fair market value of the Licensed
Product
in the country in which the Combination Product is sold and D is
the fair
market value of all other pharmaceutical product(s) included in
the
Combination Product in the country in which the Combination Product
is
sold. In such event, AltaRex shall in good faith make a determination
of
the respective fair market values of the Licensed Product and all
other
pharmaceutical products included in the Combination Product, and
shall
notify Biomira of such determination and provide Biomira with data
to
support such determination. Biomira shall have the right to review
such
determination and supporting data, and to notify AltaRex if it
disagrees
with such determination. If Biomira does not agree with such
determination, the parties shall attempt to reach agreement in
good faith
as to such respective fair market
values.
|
As
used
above, the term “Combination Product” means any product which comprises the
Licensed Product and other distinct pharmaceutical products;
The
sale
or disposition of a Licensed Product by AltaRex to or among its Sublicensees
shall not be subject to royalties based upon Net Sales Revenue, unless such
Sublicensee is the end user of the Licensed Product, but rather shall be
calculated upon the sale or disposition of a Licensed Product by any such
Sublicensee to an independent third party. If the Sublicensee is the end
user of
the Licensed Product and the transaction with such Sublicensee is not an
“arms’
length” transaction, then the “amount received” shall be the greater of (a) the
actual amount received, or (b) the amount which would have been received
had
such sale or other disposition of the Licensed Product been to a person at
arms’
length with the seller.
|
(19)
|
“Patent
Rights” means the patent applications referred to in Exhibit A to this
Agreement, together with all continuations, divisionals,
continuations-in-part, and any foreign equivalents, and any patents
issuing therefrom, including any reissues thereof, related to the
Licensed
Products and Technology;
|
49
|
(20)
|
“Proprietary
Rights” means the Patent Rights and all copyrights, trademarks, industrial
designs and other intellectual property rights or benefits (including
Know-How) specifically relating to Anti-Idiotype Applications of
the X00
Xxxxxxxx, the B43 Working Cell Bank and the Data, in each case
owned or
controlled by Biomira or Biomira Research, Inc., but excluding
the
Multi-Epitopic Patent Rights;
|
|
(21)
|
“Royalty
Period” means the period commencing on the Effective Date of the Original
Agreement and ending, on a country-by-country basis, on the latest
to
occur of (i) ten (10) years after the first January 1 following
the First
Commercial Sale of a Licensed Product in such country, or (ii)
in
consideration of the compromise of claims between the parties relating
to
the use of Biomira Data in the Multi-Epitopic Patent Rights application,
the date of expiration of the last patent included in the Multi-Epitopic
Patent Rights, if any, in such
country;
|
|
(22)
|
“Sublicensee”
means any person to whom AltaRex or any such person, directly or
indirectly, transfers any rights or privileges granted under this
Agreement, by sublicense or otherwise, to, among other things,
enable such
person to make, use or sell Licensed
Products;
|
|
(23)
|
“Technology”
means collectively the X00 Xxxxxxxx, the B43 Working Cell Bank,
the Data
and the Proprietary Rights as they relate to Anti-Idiotype
Applications.
|
| 2.1 |
Grant
of Rights
|
Subject
to the terms and conditions of this Agreement, Biomira hereby grants to AltaRex
and AltaRex hereby accepts (a) in consideration of the up-front payment of
$150,000 under Section 4.1 hereof, an exclusive worldwide right and license
under the Patent Rights, and (b) in consideration of the Net Sales Revenue
Royalty under Section 4.2 hereof, an exclusive worldwide right and license
under
the Proprietary Rights, exclusive of the Patent Rights, in either case (being
(a) or (b) above) to use the X00 Xxxxxxxx, the B43 Working Cell Bank, and
the
Data to develop, commercialize, manufacture, make, use and sell Licensed
Products solely for Anti-Idiotype Applications, including the right to grant
sublicenses to third parties, subject to the terms and conditions of this
Agreement. AltaRex, on behalf of itself and its Affiliates, expressly agrees
not
to disclose or provide rights to any technology of Biomira other than the
Technology (and with respect to the Technology only upon the terms set forth
in
this Agreement), or to make, or permit their respective employees, agents
or
consultants to make, any statements with respect to Biomira or any technology
of
Biomira other than the Technology (and with respect to the Technology only
as
specifically authorized in this Agreement), or other than with respect to
information which is already fully in the public domain through no fault
of
AltaRex or its Sublicensees. AltaRex shall, and shall require each Sublicensee
to, include in any sublicense agreement a provision binding upon the Sublicensee
that is substantially similar to the provisions of this preceding sentence.
Biomira on behalf of itself and its Affiliates, expressly agrees not to permit
their respective employees, agents or consultants to make any statements
with
respect to AltaRex or any technology of AltaRex other than as is specifically
authorized under this Agreement or other than with respect to information
which
is already fully in the public domain through no fault of Biomira or its
Affiliates or sublicensees. AltaRex shall promptly notify Biomira in writing
of
any sublicense or other transfer of all or any of the rights granted by Biomira
under this Agreement and shall ensure that the written commitment of each
Sublicensee (as a term of the agreement with the Sublicensee) is obtained
to
abide by all terms and conditions of this Agreement applicable to such
Sublicensee as a sublicensee, assignee or otherwise.
50
| 2.3 |
Termination
|
|
(1)
|
Any
party to this Agreement shall have the right to terminate this
Agreement
forthwith upon forty-five (45) days’ prior written notice if the other
party defaults in the performance, observance or fulfillment of
any of its
obligations under this Agreement. The termination shall become
effective
at the end of the forty-five (45) day period unless the breaching
party
cures such breach during such forty-five (45) day period. Notwithstanding
the foregoing, in the event that AltaRex has prior to the occurrence
of
such breach (i) granted to a financially sound third party a license
to
manufacture, market or otherwise use the Technology and Proprietary
Rights
and (ii) has designated such third party as the designated licensee
of
AltaRex (the “Designated Licensee”) by written notice to Biomira setting
forth, among other things, the name, address and fax number of
the
Designated Licensee, Biomira shall also provide written notice
of default
to the Designated Licensee at the address and/or fax number provided
to
Biomira by AltaRex, and the Designated Licensee shall have the
right to
cure such default within such forty-five (45) day period. At any
given
time, AltaRex shall only be entitled to designate one (1) Designated
Licensee for purposes of this
Agreement.
|
|
(2)
|
Either
party to this Agreement shall have the right to terminate this
Agreement
forthwith upon written notice to the other party upon the happening
of any
of the following events with respect to the other
party:
|
| (i) |
such
party becomes bankrupt or
insolvent;
|
|
(ii)
|
such
party ceases or threatens to cease to carry on business, or takes
or
threatens to take any action to liquidate its assets or institutes
any
proceedings under bankruptcy, reorganization, receivership, insolvency
or
other similar laws affecting the rights of creditors generally
or the
making by such party of a composition or an assignment or trust
mortgage
for the benefit of creditors;
|
|
(iii)
|
the
liquidation, termination of existence or dissolution of such party,
or the
voluntary appointment of a receiver, receiver-manager or custodian
for
such party or any of its property;
or
|
|
(iv)
|
the
institution against such party of any proceedings under any bankruptcy,
reorganization, receivership, insolvency or other similar laws
affecting
the rights of creditors generally, which proceedings are not dismissed
within thirty (30) days of the date of filing thereof, or any involuntary
appointment of a receiver, receiver-manager or custodian for such
party or
any of its property if such appointment is not terminated or dismissed
within thirty (30) days thereof.
|
51
Notwithstanding
the foregoing, AltaRex shall have the right during the five (5) day period
immediately following receipt of the default notice referred to in this Section
2.3(2) to assign all of its rights and obligations under this Agreement to
the
Designated Licensee and this Agreement shall remain in full force and effect
provided that the Designated Licensee is financially sound at the time in
question and agrees in writing, during such period, to be bound by the terms
of
this Agreement in the place and stead of AltaRex and all defaults hereunder
are
cured.
| 2.4 |
Protecting
the Technology
|
Biomira
is not aware, as of November 24, 1995 (the effective date of the Original
Agreement), that the Technology infringes the rights of any third party and
agrees to use all reasonable efforts to protect the Technology during the
term
of this Agreement. Except as required by law or any regulatory authority,
Biomira agrees not to knowingly provide, sell, license, assign or supply
the
Technology for Anti-Idiotype Applications to any person or entity that is
not a
party to this Agreement. AltaRex shall, and shall cause each Sublicensee
(by
ensuring that the written commitment of the Sublicensee is obtained as a
term of
the agreement granting the subject rights to the Sublicensee) to, cooperate
with
and provide reasonable assistance to Biomira in connection with protecting
the
Technology and other rights granted by Biomira under this Agreement including,
without limitation, in relation to infringement actions against third
parties.
| 2.7 |
Sublicense
Agreements
|
|
(1)
|
Within
fifteen (15) days after AltaRex or any Sublicensee grants a sublicense
to
a Sublicensee, AltaRex shall provide extracts from such sublicense
agreement to Biomira. Such extracts shall consist of the following
provisions of the sublicense agreement: (i) the identity of the
Sublicensee; (ii) the scope/field of the use of the Sublicensee
under the
sublicense agreement; and (iii) the provisions required to be included
in
the sublicense agreement pursuant to the following sections of
this
Agreement (and any other provisions, such as defined terms, which
may be
reasonably necessary to permit an understanding of such provisions):
Section 2.1, Section 2.4, Section 2.7, Section 3.5, Section 4.3
Section
4.5, Section 4.6, Article V, Section 6.1.1, Section 6.1.2 and a
termination provision similar to that set forth in Section 2.3.
The
provisions of the sublicense agreement referred to in subsection
(iii) are
referred to as the “Designated Sublicense
Provisions”.
|
|
(2)
|
AltaRex
agrees to ensure that the Designated Sublicense Provisions are
included in
each sublicense agreement with a Sublicensee (whether granted by
AltaRex
or a Sublicensee) and that such Designated Sublicense Provisions
will not
be amended (except for an amendment which in no way derogates from
AltaRex’s obligations under this Section 2.7) or deleted prior to the
termination of the sublicense in question. AltaRex shall use commercially
reasonable efforts to enforce or cause to be enforced the Designated
Sublicense Provisions against Sublicensees. AltaRex shall in a
timely
manner keep Biomira informed as to any breaches by any Sublicensee
of the
Designated Sublicense Provisions. In the event that Biomira believes
that
a Sublicensee has breached any of the Designated Sublicense Provisions,
it
may, in its discretion, provide notice of such claimed breach to
AltaRex
and AltaRex shall, within fifteen (15) days after receipt of such
notice,
use commercially reasonable efforts to cause the Sublicensee to
comply
with the applicable Designated Sublicense Provisions and AltaRex
shall
take or cause to be taken such other steps as may be commercially
reasonable under the circumstances, including the exercise of the
termination remedies in the applicable sublicense agreement with
respect
to a Sublicensee which has breached any of the Designated Sublicense
Provisions. In the event that AltaRex fails to enforce or cause
to be
enforced the Designated Sublicense Provisions against the relevant
Sublicensees, despite having used commercially reasonable efforts,
Biomira
shall have the right to seek an injunction and/or bring an action(s)
for
damages and/or specific performance against such Sublicensees and,
in
order to enable Biomira to carry out the foregoing, AltaRex shall,
as
directed by Biomira, either assign or cause to be assigned to Biomira
in a
timely manner any and all actions or causes of action(s) relating
to the
claimed breach of the Designated Sublicense Provisions or permit
Biomira
or cause Biomira to be permitted to pursue such action(s) in the
name of
Xxxx Xxx or other applicable party. In no event, however, shall
the
foregoing be construed to permit or provide Biomira with the right
to
itself directly exercise the termination remedies in the applicable
sublicense agreement.
|
52
|
(3)
|
Biomira
and AltaRex agree that the obligations of AltaRex under this Agreement
in
relation to sublicensing of any rights granted under this Agreement
(including without limitation the obligations with respect to the
Designated Sublicense Provisions and Biomira’s rights under Section
2.7(2)) shall apply mutatis mutandis to any other transfer by assignment
or otherwise of any rights or privileges granted by Biomira under
this
Agreement.
|
| 3.5 |
Compliance
with Laws
|
AltaRex,
on behalf of itself and its Affiliates, agrees to comply in all material
respects with any and all applicable local, state, provincial, national,
federal
and/or international laws and regulations pertaining to the development,
testing, manufacture, promotion, sale and disposition of Licensed Products
and
to xxxx all Licensed Products or their packaging with all applicable patent
numbers and similarly to indicate “patent pending” status and to make such other
markings as are necessary to preserve the Patent Rights. AltaRex shall obtain
the agreement of each Sublicensee to comply with the provisions of this Section
3.5.
| 4.3 |
Reports
|
Within
sixty (60) days of June 30 and December 31 in each calendar year following
the
First Commercial Sale of Licensed Products, AltaRex shall provide to Biomira
a
written report, certified by a senior officer of AltaRex, showing in reasonable
detail and in such form as Biomira may reasonably request:
|
4.3.1
|
the
Net Sales Revenue (including Net Sales Revenue by Sublicensees)
during the
preceding six-month period;
|
|
4.3.2
|
the
basis for the calculation of all royalties and other amounts payable
by
Xxxx Xxx to Biomira pursuant to this Agreement;
and
|
| 4.3.3 |
such
other reasonable information with respect to the foregoing as Biomira
may
request.
|
53
| 4.5 |
Records
|
AltaRex
shall maintain adequate and complete records (and shall require its Sublicensees
to maintain such records) showing:
| 4.5.1 |
the
Net Sales Revenue received by AltaRex or any Sublicensees;
and
|
|
4.5.2
|
the
basis for the calculation of all royalties and other amounts payable
by
AltaRex to Biomira pursuant to this
Agreement.
|
AltaRex
shall retain such records (and shall require each Sublicensee to retain such
records) for a period of five (5) years from the date of their
making.
| 4.6 |
Audit
Inspection
|
|
(1)
|
AltaRex
and its Affiliates shall make available the records referred to
in Section
4.5 for the prior five (5) year period on reasonable notice during
AltaRex’s normal business hours for inspection by a national firm of
chartered accountants or certified public accountants on behalf
of Biomira
PROVIDED HOWEVER no one will be allowed to inspect any records
of AltaRex
and its Affiliates without having first signed a confidentiality
agreement
provided by AltaRex which shall contain only terms which are consistent
with industry standards in similar circumstances and which will
not
restrict the accountants in question from pursuing the inspection
rights
hereunder and reporting to Biomira. Any such inspection shall be
made at
the expense of Biomira unless it is determined that Biomira was
entitled
to receive a sum which varied greater than ten (10%) percent from
the
amount reported by AltaRex as due and payable to Biomira for the
period
covered by the inspection, in which case AltaRex shall pay the
reasonable
costs of such inspection and interest, as provided in Section 4.4.
AltaRex
and its Affiliates shall cooperate fully with the chartered accountants
or
certified public accountants conducting the inspection provided
for in
this Section 4.6.
|
|
(2)
|
In
the event that AltaRex conducts an audit of the records and books
of
account of a Sublicensee, the audit report shall be provided to
Biomira by
the chartered accountant or certified public accountant at the
same time
that such report is provided to AltaRex. In addition, in the event
that
Biomira believes that it would be appropriate to conduct an audit
of the
records and books of account of a Sublicensee (other than an Affiliate
of
AltaRex), Biomira shall notify AltaRex and AltaRex shall promptly
use
commercially reasonable efforts to cause such audit to be conducted,
with
the audit report to be provided simultaneously to AltaRex and Biomira.
AltaRex shall obtain the written agreement of each Sublicensee
to permit
the conduct of such audits and the provision of the audit report
to
Biomira. Biomira agrees to treat each such audit report as Confidential
Information of AltaRex.
|
54
ARTICLE
V
CONFIDENTIALITY
| 5.1 |
Confidentiality
|
|
5.1.1
|
Subject
to Section 5.2 of this Agreement, all Confidential Information
shall be
held in strict confidence by each of the parties to this Agreement
and
each party to this Agreement shall employ or cause to be employed
diligent
efforts and reasonable care in order to ensure that such Confidential
Information is not made available to any third party excepting
only as
required under this Agreement, or to the directors, officers, employees
and consultants of such party to this Agreement whose duties require
disclosure of the same and then (in any such case) only if the
parties to
whom such Confidential Information is being disclosed have given
to each
of the parties to this Agreement an enforceable undertaking (in
form
acceptable to Biomira and AltaRex, acting reasonably) not to disclose
such
Confidential Information to any other party, provided that Alta
Xxx xxx
disclose Confidential Information to a Sublicensee so long as such
Sublicensee has agreed to treat the Confidential Information in
the manner
provided in this Article V.
|
|
5.1.2
|
Subject
to Section 5.1.3 of this Agreement, Confidential information which
is
obtained by any party to this Agreement from a third party without
obligation of confidence (provided, however, that such third party
has no
obligation of confidence to one of the parties hereto) or which
becomes
public knowledge otherwise than through the fault of a party to
this
Agreement or any of such party’s directors, officers, agents, consultants,
servants or employees, shall be deemed to be in the public domain
and
accordingly Section 5.1.1 of this Agreement shall not apply to
such
portion of the Confidential Information which has been so obtained
or
which has become public knowledge.
|
|
5.1.3
|
Confidential
Information which is specific shall not be deemed to be within
the public
domain merely because it is embraced by general knowledge in the
public
domain. Further, any Confidential Information dealing with any
combination
of features of a specific matter shall not be deemed to be within
the
public domain, unless the combination of features and the principle
of
operation are in the public domain.
|
|
5.1.4
|
Each
party to this Agreement shall, upon the termination of this Agreement,
return all corporeal Confidential Information to the owner of such
Confidential Information with a written undertaking that no copies,
duplicates or progeny have been
retained.
|
|
5.1.5
|
Each
of the parties of this Agreement acknowledges that the other parties
to
this Agreement would suffer irreparable harm as a result of the
breach of
any of the non-disclosure and confidentiality obligations set forth
in
this Article 5 and that legal remedies are inadequate: therefore,
each of
the parties to this Agreement agrees that, in addition to any damages
and
other remedies that the other parties to this Agreement may be
entitled to
as a result of such a breach, the other parties to this Agreement
shall be
entitled to an order from a court of competent jurisdiction restraining
such party from breaching or continuing to breach any of the provisions
of
this Article 5.
|
55
|
5.1.6
|
The
covenants of the parties under this Article 5 shall continue in
full force
and effective notwithstanding the termination of this Agreement
by
effluxion of time or otherwise.
|
|
5.1.7
|
In
the event either party is required by law or any governmental or
regulatory authority having jurisdiction to disclose any information
that
party has the right to do so subject to such party hereto using
its best
efforts to take all reasonably available means to keep details
of this
Agreement and its terms and the Confidential Information of the
other
party confidential.
|
|
5.1.8
|
Nothing
in this Agreement shall prevent AltaRex through its officers, employees
or
agents from presenting or publishing such information related to
the
Technology as is necessary for the commercialization of Licensed
Products,
including, but not limited to, the use of the Technology in patent
applications and patents, communications with regulatory authorities,
scientific publications and presentations and marketing materials;
PROVIDED THAT AltaRex shall ensure that in doing so, no Biomira
Confidential Information other than Biomira Confidential Information
relating to the Technology will be disclosed without Biomira’s prior
written consent which may be unreasonably
withheld
|
|
6.1.1
|
AltaRex
has agreed to acquire the rights granted under this Agreement,
and all of
the data and other materials acquired hereunder on an “as is” basis.
AltaRex shall, and shall require each Sublicensee to, include a
provision
in each agreement with a Sublicensee acknowledging the prior sentence.
Accordingly, AltaRex shall accept the entire responsibility related
to or
arising out of the use by AltaRex or any Sublicensee of the Technology
or
the development, manufacture, use or sale of any product based
on the
Technology. Except as set forth in Section 2.3, Biomira makes no
warranties, whether expressed or implied, as to any matter whatsoever
to
AltaRex or any third parties with respect to the Technology, any
Licensed
Product or any aspect thereof, including without limitation, as
to the
validity of any right granted by Biomira under this Agreement or
that any
such right or Licensed Product will be free from infringement of
the
rights of third parties. If AltaRex or any Sublicensee receives
written
notice that any Licensed Product or right granted under this Agreement
constitutes an infringement of the rights of a third party, AltaRex
shall,
if it or any Sublicensee intends to continue to develop, manufacture,
use
or sell such Licensed Product, within fifteen (15) days after receipt
of
such notice, provide to Biomira a means reasonably satisfactory
to
Biomira, whereby Biomira shall be fully protected from damages,
actions,
claims, costs and expenses which may arise as a result of the decision
of
AltaRex or any Sublicensee to continue to develop, manufacture,
use or
sell the Licensed Product or to use such right. If, after complying
with
the preceding sentence, AltaRex or any Sublicensee continues to
develop,
manufacture, use or sell the Licensed Product or use such right,
AltaRex
or such Sublicensee does so at its own risk and AltaRex will and
does
hereby indemnify Biomira for any damages, actions, claims, costs
and
expenses incurred by Biomira, except as provided in Section 2.3,
which may
arise as a result of AltaRex, its Affiliates or Sublicensees continuing
to
develop, manufacture, use or sell the Licensed Product or use such
right.
|
|
6.1.2
|
AltaRex,
on behalf of itself and its Affiliates, acknowledges that the Technology
is the property of Biomira and that Biomira has made no representations
or
warranties to AltaRex in connection with the Technology under this
Agreement and AltaRex hereby agrees that it will not make any claim
or
demand against Biomira or any of its officers, directors, employees,
agents or consultants for any loss, cost, damage or expense, whether
direct or indirect or consequential, suffered or sustained by AltaRex
or
any person claiming through Xxxx Xxx, which is based upon, arises
out of
or is connected with the Technology and AltaRex hereby waives as
against
Biomira, its officers, directors, employees, agents and consultants
all
such claims and demands. In any agreement with a Sublicensee, AltaRex
shall secure or cause to be secured a similar covenant from such
Sublicensee.
|
56
APPENDIX
F
COSTS
ASSOCIATED WITH XXXX #0 XXX #0
|
Xxxxxx
|
X.X.x000,000
|
|
Related
supplies
|
U.S.$375,000
|
|
Xxxxxxx
River Laboratories
|
U.S.$182,000
for lot #2
U.S.$182,000
estimated for lot #3
|
|
SP
Pharma (fill finish)
|
U.S.$75,000
for lot #2
U.S.$75,000
estimated for lot #3
|
|
Other
miscellaneous vendors
|
U.S.$150,000
for both lots
|
|
Total
|
U.S.$1,814,000
for both lots
|
