EXHIBIT 10.8
LICENSE AGREEMENT
This License Agreement ("Agreement") is entered into as of November
16, 1995 (the "Effective Date") between Xxxx Xxxxxxxxx, M.D. ("Xxxxxxxxx"), an
individual, and Xxxxxx Xxxxxx, M.D. ("Xxxxxx"), an individual (together
"Licensor"); and Triangle Pharmaceuticals, Inc., a Delaware corporation having
principal offices at 1829 East Franklin Street, Building 1000, Xxxxx 0000,
Xxxxxx Xxxx, Xxxxx Xxxxxxxx 00000 ("Triangle").
1. CERTAIN DEFINITIONS.
1.1 An "Affiliate" of a party shall mean an entity directly or
indirectly controlling, controlled by or under common control with that party;
provided that such entity shall be considered an Affiliate only for the time
during which such control exists.
1.2 "Approved Agreements" shall mean:
(i) The patent policy ("Patent Policy") of The University of
California, San Diego ("UCSD") to the extent applicable to either of the
individuals comprising Licensor;
(ii) The Consulting Agreement dated October 28, 1994 between
Xxxxxxxxx and Vestar, Inc. (the predecessor of NeXstar, Inc.), as in effect as
of the Effective Date;
(iii) The Consulting Agreement dated July 30, 1990 between
Xxxxxx and CIBA-GEIGY Corporation, as in effect as of the Effective Date; and
(iv) So long as Xxxxxxxxx or Xxxxxx (as applicable) comply with
the right of first refusal contained in Section 15 below, any future agreements
entered into by Xxxxxxxxx or Xxxxxx and a third party, pursuant to which the
third party provides funding to the research laboratory of Xxxxxxxxx or Xxxxxx
in an academic institution where Xxxxxxxxx or Xxxxxx is employed, and pursuant
to which the third party receives rights to patents or patent rights resulting
from such research.
1.3 "Consulting Agreements" shall mean the two (2) Consulting
Services Agreements of even date herewith between each Licensor and Triangle
pursuant to which Licensors will provide consulting services to Triangle.
1.4 "Cost" shall mean all fully burdened costs incurred in connection
with procurement, manufacture and testing as determined in accordance with
generally accepted accounting principles, as stated in the financial statements
of Triangle. If any Costs are calculated based upon unaudited financial
statements of Triangle and subsequently issued and independently audited
financial statements of Triangle for the same accounting period disclose
different Costs, then to the extent any Royalties were
* Certain confidential portions of this Exhibit were omitted by means of
marking such portions with an asterick (the "Xxxx"). This Exhibit has been
filed separately with the Secretary of the Commission without the Xxxx
pursuant to the Company's Application Requesting Confidential Treatment under
Rule 406 under the Securities Act.
previously paid based upon the unaudited Costs, Licensor or Triangle, as the
case may be, shall within thirty (30) days after Triangle's receipt of such
audited financial statements, pay the other party an amount (or, in the case of
amounts due to Triangle, Triangle may offset such amounts against any subsequent
payments owed to Licensor) such that Triangle shall have paid the correct
Royalty amount for such accounting period based upon the independently audited
Costs.
1.5 "IND" shall mean an Investigational New Drug Application with the
U.S. Food and Drug Administration or the equivalent agency of a Major Country,
to commence Phase I clinical trials of a Licensed Product.
1.6 "Licensed Product" shall mean an item (other than an Orphan Drug)
that the sale or distribution by Triangle would, but for the License, infringe
the Patent Rights.
1.7 "Major Country" means any of the United States of America,
Canada, Australia, Japan and any country in the European Union as of the
Effective Date or at any time during the term of this Agreement.
1.8 "NDA" shall mean a New Drug Application with the U.S. Food and
Drug Administration or the equivalent in any Major Country.
1.9 "Net Sales" means the actual billing price received by Triangle
or its Affiliates or sublicensees from sales of Licensed Products or Orphan
Drugs to Third Party customers (but not including the sale by Triangle to either
an Affiliate or a sublicensee) during the term of this Agreement, less the
following deductions:
(i) any allowances actually made and taken for rejections or
returns; transportation, delivery and insurance costs actually incurred; cash
discounts actually allowed in amounts and for purposes customary in the trade
(including private sector or governmental rebates related to such); sales, use,
withholding, value-added and similar taxes and duties and similar governmental
assessments (on products as shipped);
(ii) in the event of distribution of such product pursuant to a
reagent rental or comparable sales or lease program, the amount allocated by the
party (using generally accepted accounting principles consistently applied) to
equipment/instrument recovery accounts; and
(iii) if a product is distributed for use in combination with
or as a component of other products, a portion of the resulting revenue equal to
the total revenue from such distribution multiplied by the fraction A/(A+B),
where A is the retail price specified in the party's published retail price list
as of the end of the applicable period ("Retail Price") for the amount of the
other product or components used in the combination when distributed separately
and B is the Retail Price for the amount of the product used in the combination
when distributed separately; provided, however, that if the products in the
combination are not distributed separately, the amount which may be
2.
deducted shall be as determined using the same formula but substituting Cost for
Retail Price.
Net Sales shall also include the amount of any recoveries
actually obtained by Triangle under a lawsuit maintained by Triangle under
Section 9, less all actual costs and expenses incurred by Triangle in connection
with such lawsuit.
1.10 "Orphan Drug" shall mean, in a particular country, a
pharmaceutical drug: (i) that incorporates inventions of Licensor contained in
the Patent Rights; and (ii) concerning which Triangle by law in such county has
the exclusive right to sell such pharmaceutical drug (other than by patent);
provided that such pharmaceutical drug shall be considered an Orphan Drug only
for such period of time that Triangle has the exclusive right to sell such drug
in such country.
1.11 "Patent Rights" shall mean (i) the patent applications of Xx.
Xxxxxxxxx filed on [ * ] and entitled [ * ] and all inventions described therein
("Acyclovir Patent Rights"), (ii) the joint patent application of Drs. Xxxxxxxxx
and Xxxxxx filed [ * ] and all inventions described therein ("Nucleotide Patent
Rights") (the patent rights in clauses (i) and (ii) shall collectively be
referred to herein as the "Existing Patent Rights"), (iii) all other existing
and future patents and patent rights (domestic or foreign) of either Licensor
in the anti-viral or anti-cancer fields (other than those owned by Triangle
pursuant to Section 2.3) obtained or arising from inventions made by such
Licensor prior to the earlier of the [*] anniversary of the Effective Date
or, with respect to Xxxxxx or Xxxxxxxxx, as applicable, the date (if any)
that Triangle terminates the applicable Consulting Agreement, to the extent
such Licensor is not contractually obligated to assign or license such
existing and/or future patents and/or patent rights to third parties pursuant
to Approved Agreements, (iv) all technology and/or "Rights" (as defined in
the Consulting Agreements) owned or licensed by Licensor and not assigned to
Triangle under the Consulting Agreements, but only (A) to the extent not
prohibited by the Patent Policy, and (B) to the extent that any "Rights,"
"Inventions" or "Results" (as defined in the Consulting Agreements) assigned
to Triangle under the Consulting Agreements are (1) based on, incorporate, or
are improvements or derivatives of, or (2) cannot be reasonably made, used,
reproduced and distributed without using or violating, such technology and/or
"Rights," and (v) any and all patents whether U.S. or foreign that are or may
be granted from the foregoing, including without limitation any extensions,
continuations, substitutions, continuations-in-part, certificates, divisions,
reissues and renewals thereof, or foreign equivalents thereof.
1.12 "Proprietary Information" of a Disclosing Party shall mean the
following, to the extent previously, currently or subsequently disclosed to the
other party hereunder or otherwise: information relating to Licensed Products
or Orphan Drugs, the properties, composition or structure thereof or the
manufacture or processing thereof or machines therefor or to the Disclosing
Party's business, products, marketing efforts,
* CONFIDENTIAL TREATMENT REQUESTED
3.
development efforts, technology or finances (including, without limitation,
names and expertise of employees and consultants, ideas, inventions (whether
patentable or not), formulae, manufacturing processes, intermediates,
precursors, cell lines, reagents, uses, methods of use, techniques, know-how,
data, information, schematics and other technical, business, financial, customer
and product development plans, forecasts, strategies and information),
information contained in the patent applications included in the Patent Rights,
and any other information, the disclosure of which might harm or destroy a
competitive advantage of Triangle.
1.13 "Restricted Stock Purchase Agreement" shall mean the Restricted
Stock Purchase Agreement dated as of October 31, 1995 among the Licensors and
Triangle pursuant to which Licensors have purchased Common Stock of the Company.
1.14 "UCSD" shall mean the University of California, San Diego.
2. LICENSE GRANT; TRANSFER; IMPROVEMENTS; COOPERATION.
2.1 LICENSE GRANT. Licensor hereby grants to Triangle a
transferable, sublicensable, unlimited, worldwide, exclusive license (the
"Exclusive License"): (a) to fully exploit all rights, title and interest to
the Patent Rights and any applicable items referenced in Section 3(o) of either
Consulting Agreement, and (b) to make, have made, use, market, distribute and
sell Licensed Products and Orphan Drugs. Licensor hereby grants to Triangle a
transferable, sublicensable, unlimited, worldwide, non-exclusive license
(together with the Exclusive License, the "License") to fully exploit all
rights, title and interest to any inventions, formulae, ideas, manufacturing
processes, intermediates, precursors, cell lines, reagents, uses, methods of
use, techniques, know-how, data, information, improvements, modifications or
derivatives, whether or not patentable or now existing, related to the Patent
Rights (the "Technology"), including, without limitation, any and all patent
rights, copyrights, trade secret rights and other rights in connection therewith
(the "Proprietary Rights"). Triangle shall have the right to extend the License
granted herein to any Affiliate or sublicensee. The defined terms "Technology"
and "Proprietary Rights" under this Agreement shall include all technology
and/or "Rights" (as defined in the Consulting Agreements) owned or licensed by
Licensor and not assigned to Triangle under the Consulting Agreements, but only
(A) to the extent not prohibited by the Patent Policy, and (B) to the extent
that any "Rights," "Inventions" or "Results" (as defined in the Consulting
Agreements) assigned to Triangle under the Consulting Agreements are (1) based
on, incorporate, or are improvements or derivatives of, or (2) cannot be
reasonably made, used, reproduced and distributed without using or violating,
such technology and/or "Rights."
2.2 TRANSFER OF TECHNOLOGY. To carry on the physical transfer of
Technology from Licensor to Triangle and to enable Triangle to exercise the
License, Licensor will promptly disclose and provide to Triangle the Technology
and existing patent applications and patents included in the Patent Rights and
all files, data and other information relating to the foregoing that are under
the control of Licensor. Licensor
4.
agrees not to (and will bind any licensees not to), directly or through
intermediaries, exploit the Patent Rights, Proprietary Rights or, in any manner,
the Technology.
2.3 IMPROVEMENTS. Any improvements or modifications to Technology
(whether or not patentable or copyrightable) that are developed by either party
shall be owned solely by such party; except that Triangle shall own all right,
title and interest to any improvements, modification or other Proprietary Rights
that result from the services provided by either Licensor pursuant to the
Consulting Agreement. Any modification or improvement to the Technology made by
either Licensor but not owned by Triangle pursuant to the preceding sentence
shall be included in the License without additional charge to Triangle, subject
to the obligations of Licensor to license or assign such modifications or
improvements to UCSD or any other academic employer. Licensors agree to
promptly disclose to Triangle all modifications and improvements to the
Technology. Except as provided to the contrary in Section 7, each party shall
have the right, at its own expense, and solely in its own name, to apply for,
prosecute and defend its Proprietary Rights with respect thereto. For the
purposes of this Section 2.3, an improvement or a modification shall mean any
invention, discovery, modification or improvement, whether patentable or not,
which can be employed to reduce developing, manufacturing or assembly costs of
any Licensed Product or Orphan Drug, improve performance of any Licensed Product
or Orphan Drug, increase market life of any Licensed Product or Orphan Drug,
broaden the applicability or range of uses of any Licensed Product or Orphan
Drug or create a wholly-new product, device, part, component, treatment,
procedure or test equipment. An improvement or a modification shall also
include, without limitation, modifications to existing copyrightable works of
authorship.
2.4 ASSISTANCE. Each Licensor agrees to assist Triangle in every
proper way requested by Triangle to evidence and perfect the License and to
apply for and obtain and from time to time, enforce, maintain, and defend
anywhere in the world the Patent Rights and Proprietary Rights, and any
regulatory approvals, all of which Triangle is granted the unilateral,
exclusive, transferable right to do. Any regulatory approvals will be obtained
in Triangle's name and, to the extent allowed by law, any such existing rights
or approvals (or applications therefor) are hereby assigned to Triangle and
shall otherwise be for the sole benefit of Triangle. Each Licensor will execute
all documents Triangle may reasonably request for any of the foregoing purposes
and agrees to take no actions that could in any way impair Triangle's rights and
interests in the License or the Patent Rights. Each Licensor hereby irrevocably
designates and appoints Triangle and its duly authorized officers and agents, as
his agents and attorneys-in-fact to act for and in such Licensor's behalf and
instead of Licensor, to execute and file any such document and to do all other
lawfully permitted acts to further the purposes of the foregoing with the same
legal force and effect as if executed by each Licensor.
3. CONSIDERATION; ROYALTIES; AUDIT. As consideration for the License,
during the term of this Agreement:
5.
3.1 Triangle shall enter into the Restricted Stock Purchase Agreement
and sell a total of 500,000 shares of its Common Stock to the Licensors, 300,000
shares to Xx. Xxxxxxxxx and 200,000 shares to Xx. Xxxxxx, on the terms and
conditions set forth therein.
3.2 Triangle will make two separate milestone payments of
$1,000,000 each [*]
3.3 During the term of this Agreement, Triangle will pay royalties
to Drs. Xxxxxxxxx and Xxxxxx on Net Sales (calculated on a calendar year
basis) of each Licensed Product that incorporates the Patent Rights in the
amount of four percent (4%) on the first [*] of Net Sales in any calendar
year, six percent (6%) on the next [*] of Net Sales in any calendar year, and
eight percent (8%) on any Net Sales greater than [*] in any calendar year.
During the term of this Agreement, Triangle will [*] on Net Sales (calculated
on a calendar year basis) of each Orphan Drug that incorporates inventions of
Licensor contained in the Patent Rights in the amount of three percent (3%)
of Net Sales. The royalties required to be paid by Triangle pursuant to the
preceding two sentences shall be the "Royalties." For Royalties on Licensed
Products that incorporate the Nucleotide Patent Rights, such Royalties will
be divided equally between Drs. Xxxxxxxxx and Xxxxxx. For Royalties based on
Licensed Products that do not incorporate the Nucleotide Patent Rights, such
Royalties will be paid to the particular owner of the Patent Rights (or
proportionally with any other joint owners). With respect to sales of
Licensed Products in any particular country: (a) Triangle will not have any
obligation to pay Royalties unless and until a patent licensed hereunder
(with valid claims covering the items) incorporated in such Licensed Product
has issued and remains in effect in such country; and (b) Triangle's Royalty
obligations will cease with respect to any Royalty-bearing sale or use
occurring after the expiration in such country of the particular patent
incorporated into such Licensed Product. With respect to sales of Orphan
Drugs in any particular country for any particular indication: (i) Triangle
will not have any obligation to pay Royalties unless and until Triangle by
law in such country has the exclusive right to sell such Orphan Drug for such
particular indication; and (ii) Triangle's Royalty obligations will cease
with respect to any Royalty-bearing sale or use occurring after Triangle by
law in such country no longer has the exclusive right to sell such Orphan
Drug for such
* CONFIDENTIAL TREATMENT REQUESTED
6.
particular indication. The parties agree that the Royalties payable to Drs.
Xxxxxxxxx and Xxxxxx pursuant to this Section 3.3 on account of sales of
Licensed Products and Orphan Drugs shall be based on the Net Sales during
each calendar year of each Licensed Product that incorporates the Patent
Rights and each Orphan Drug that incorporates inventions of Licensor
contained in the Patent Rights, with such Net Sales being calculated
separately each calendar year and not including any Net Sales from any other
calendar year.
3.4 Notwithstanding anything else in this Agreement, the Royalties
specified in Section 3.3 shall be reduced as follows:
(a) by [*] of the royalties paid to third parties for the
acquisition of rights to third party technology that is incorporated by
Triangle into a Licensed Product or Orphan Drug, provided that the Royalties
specified in Section 3.3 shall not be reduced because of such third party
licenses to less than [*] of what it would have been in the absence of this
Section 3.4(a); and
(b) by an amount equal to Triangle's and its sublicensees'
damages, settlements, costs, losses, and other expenses (including without
limitation attorneys' fees) incurred in connection with (i) third-party
claims of infringement (as provided under Section 8.3) or (ii) breach of this
Agreement by Licensor; provided that reductions pursuant to this Section
3.4(b) shall be spread out, if necessary, so that no payment to Licensor is
reduced to less than [*] of what it would have been in the absence of this
Section 3.4(b).
The Royalty reduction provided in subsections (a) and (b) above shall be
cumulative. For example, if both reduction provisions are applicable, then
the Royalty rate may be reduced to as low [*] of the applicable Section 3.3
Royalty amount.
3.5 Royalties shall be paid within [*] after the end of each [*]
with respect to Royalty-bearing Net Sales occurring in that [*].
Notwithstanding anything to the contrary in Section 3.3, Royalties with
respect to Net Sales of any particular Licensed Product or Orphan Drug unit
will be paid by Triangle or the Affiliate or sublicensee that made the
Royalty-bearing sale or disposition from the country into which such unit was
sold or disposed and will be subject to any local applicable laws or
regulations. Subject to the following, payments will be made in U.S. dollars.
Net Sales and the amounts payable shall first be determined in the currency
of the applicable country and shall then be converted into the equivalent
amount of U.S. dollars (a) at the official closing rate two business days
prior to the date of payment hereunder, as established by the central bank or
exchange control authorities in such country; or (b) if no such official rate
is available or if conversion pursuant to such official rate cannot be
effectuated by the company making the sale giving rise to the payment
obligation, at the closing rate two business days prior to the date of
payment hereunder established by a leading commercial bank (selected by
Triangle) in the
* CONFIDENTIAL TREATMENT REQUESTED
7.
relevant country. If at any time conditions or legal restrictions exist which
conditions or restrictions prevent the prompt remittance of the royalties due
hereunder, or if conversion into U.S. dollars pursuant to the foregoing cannot
be effectuated, the parties shall cooperate fully with each other and make
reasonable efforts to permit conversion and remittance. If such efforts shall
be unsuccessful, Triangle or its Affiliates or sublicensees shall then, as long
as such conditions or restrictions shall exist in such country, pay the
Royalties in the currency of such country to such person, company or bank in
said country, as shall be nominated by Licensor.
3.6 Triangle and its Affiliates shall keep and maintain detailed
books and records sufficient to document Net Sales, Royalties and the
calculation thereof for [*] after Triangle's receipt of the particular Net
Sales. Licensor or its representatives (who shall be reasonably acceptable
to Triangle) shall be entitled to review and audit such books and records no
more than once each year during normal business hours upon reasonable notice
to Triangle and at Licensor's expense; provided that Triangle will bear any
such expense if the review or audit shows an underpayment of more than [*] for
the applicable period.
4. DEVELOPMENT AND MARKETING EFFORTS.
4.1 Triangle will use best efforts to produce and market Licensed
Products under the License. Licensors' sole remedy for any alleged failure to
use best efforts hereunder shall be to terminate the exclusivity of the License
as to the Patent Rights to which such failure applies; provided that the
foregoing best efforts obligation shall not apply if (a) Triangle can
demonstrate that the failure to use best efforts hereunder is the result of
matters beyond the control of Triangle and which would similarly have prevented
Licensor or a similarly situated third party from performing such obligations;
or (b) Triangle, within ninety (90) days after notice of such failure, either
uses its best efforts to produce and market Licensed Products or pays in advance
the applicable milestone payment described in Section 3.2. In making any such
determination of Triangle's best efforts, the parties will be obligated to take
into account the normal course of such programs conducted with sound and
reasonable business practices and judgement. Evidence provided by Triangle that
it has a substantial ongoing and active or anticipated research, development,
manufacturing, marketing or licensing program, as appropriate, directed toward
the Licensed Products shall be deemed satisfactory evidence of best efforts
hereunder.
4.2 In addition to the requirement set forth in Section 4.1, in
the event that Triangle fails to file an IND (i) on or before January 1,
2000 for a Licensed Product that incorporates either of the two (2) Existing
Patent Rights and (ii) on or before January 1, 2002 for a Licensed Product
that incorporates the other of the two (2) Existing Patent Rights, then only
with respect to the particular Existing Patent Right that was not
incorporated into a Licensed Product for which Triangle filed an IND, all
rights granted hereunder to such Existing Patent Right shall automatically
terminate.
* CONFIDENTIAL TREATMENT REQUESTED
8.
5. NO RESTRICTION ON COMPETITION. Nothing in this Agreement shall be
deemed to prohibit Triangle from developing, making, using, marketing or
otherwise distributing or promoting products competitive with Licensed Products
or Orphan Drugs produced hereunder, provided that Triangle does not breach any
provision of Section 6 in doing so.
6. CONFIDENTIALITY.
6.1 Each party hereunder that receives Proprietary Information (a
"Recipient Party") from the other party hereunder (a "Disclosing Party")
understands that such information is proprietary to and constitutes trade
secrets of the Disclosing Party. Except as contemplated by the terms of this
Agreement, during and after the term of this Agreement, each party shall hold in
confidence and not use, reproduce or directly or indirectly disclose or provide
to any third party (other than, in the case of Triangle, an Affiliate, a
sublicensee, or a person or entity with which Triangle has a collaborative
relationship) any Proprietary Information received from the other party.
Furthermore, while this Agreement remains in effect Licensor shall hold in
confidence and not directly or indirectly disclose or provide to any third
party, reproduce or use the Technology without Triangle's prior written consent.
6.2 Section 6.1 shall impose no obligation upon the Recipient Party
with respect to any information that the Recipient Party can demonstrate (i) is
or becomes generally known to the public through no action or inaction by the
Recipient Party, or (ii) was disclosed to the Recipient Party without
restriction by a third party not in violation of any other party's proprietary
rights, or (iii) was in the Recipient Party's possession without restriction
prior to disclosure, or (iv) was independently developed by the Recipient Party.
6.3 Each party shall retain ownership of all of its technology and
Proprietary Rights and neither party shall have any right or license in the
other's technology or Proprietary Rights except as expressly provided in this
Agreement. Specifically, but without limitation, Triangle will solely own any
technology created by or for it and the Proprietary Rights with respect thereto.
6.4 Immediately upon termination of this Agreement or (except for
Proprietary Information licensed to Triangle hereunder) earlier upon the request
of the Disclosing Party, the Receiving Party will turn over to the Disclosing
Party all Proprietary Information of the Disclosing Party and all documents or
media containing any such Proprietary Information and any and all copies or
extracts thereof.
7. PATENT MATTERS.
7.1 Triangle shall make payment to Licensor in full for all costs
incurred by Licensor on or before the Effective Date for the preparation,
filing, prosecution, issuance, and maintenance of the Patent Rights and any
additional legal
9.
costs of the Licensors in connection with their entering into this Agreement,
up to a total of [*]. Triangle agrees to make such payments to Licensor
and/or directly to the third parties to which Licensor is obligated for such
costs within 30 days of invoice from Licensor and/or such third parties.
7.2 Payment of all fees and costs relating to the filing,
prosecution, and maintenance of the Patent Rights after the Effective Date shall
be the responsibility of Triangle. During the term of this Agreement, Triangle
shall have the sole right and discretion to file and prosecute patent
applications and maintain patents throughout the world relating to the
Technology or any improvements made by or for itself or Licensor. At Licensor's
request, Triangle will discuss its decisions on these matters with Licensor, but
Licensor will not attempt to file or prosecute any such patent applications or
maintain any such patent (i) except as Triangle may, in its sole discretion,
approve in writing and (ii) except that Licensor may continue maintenance of the
Patent Rights if Triangle elects not to do so.
7.3 To the extent reasonable and practical regarding Licensed
Products and Orphan Drugs, Triangle agrees to xxxx permanently and legibly all
Licensed Products and Orphan Drugs and documentation manufactured and sold by it
under this Agreement with such patent notice as is required under Xxxxx 00,
Xxxxxx Xxxxxx Code.
7.4 Xxxxxxxxx and Xxxxxx have further reviewed and investigated the
issue of inventorship of the Nucleotide Patent Rights. Xxxxxxxxx and Xxxxxx
represent and warrant that, notwithstanding that Xxxxxx is named as a co-
inventor on the patent application concerning the Nucleotide Patent Rights,
Xxxxxx is not a co-inventor of any claim or invention contained or referenced in
the Nucleotide Patent Rights. Xxxxxx hereby disclaims all right or claim as a
co-inventor under the Nucleotide Patent Rights, and agrees to take all actions
and execute all documents as requested by Triangle or Xxxxxxxxx to remove
Xxxxxx'x name from patent applications or patents concerning Nucleotide Patent
Rights and to otherwise confirm the representations and covenants contained in
this Section 7.4.
8. INDEMNIFICATION; INFRINGEMENT SUIT CREDIT.
8.1 Subject to Section 8.2, Triangle shall hold harmless and
indemnify each Licensor from and against any claims, demands, or causes of
action whatsoever, including without limitation those arising on account of any
injury or death of persons or damage to property caused by or arising out of, or
resulting from, the exercise or practice of the License by Triangle or its
officers, employees, agents, Affiliates, sublicensees or representatives.
8.2 Licensor shall promptly notify Triangle in writing of any claim
or suit or threat thereof brought against Licensor in respect of which
indemnification may be sought and, to the extent allowed by law, shall
reasonably cooperate with Triangle in defending or settling any such claim or
suit. No settlement of any claim, suit or threat
* CONFIDENTIAL TREATMENT REQUESTED
10.
thereof received by Licensor and for which Licensor will seek indemnification,
shall be made without the prior written approval of Triangle. Licensor will
permit Triangle to defend Licensor against any such claim, suit or threat
thereof and Triangle shall have sole control over the defense, subject to
Licensor's right to select its own counsel to review the matter for Licensor at
Licensor's sole cost and expense.
8.3 If a lawsuit is filed against Triangle or either Licensor and if
such claims concern the Patent Rights or Technology, Triangle may suspend those
Royalties due Licensor under Section 3.3 from Net Sales of Licensed Products or
Orphan Drugs in any national jurisdiction in which suit is brought, and pay such
amounts into an escrow account established by Triangle until such situation is
resolved. Should a patent within Patent Rights under which such Royalties are
payable be held invalid, the accrued Royalties paid into escrow shall be paid to
and retained by Triangle. Should litigation or settlement result in the
requirement that Triangle pay royalties or other monies to a third party, the
parties hereunder agree that such amounts shall offset Triangle's obligation to
pay Royalties as described in Section 3.4. In the event the validity of a
patent within Patent Rights is upheld, the accrued Royalties shall be paid to
Licensor, subject to the terms of Section 3.4 with respect to Triangle's costs
and expenses. Any damages or attorneys' fees awarded or received in settlement
of any suit shall be retained by Triangle in satisfaction of its litigation
expenses.
9. INFRINGEMENT BY THIRD PARTIES. Triangle shall have the first right
to enforce or have enforced at no expense to Licensor any Patent Rights to
the extent exclusively licensed hereunder against infringement by third
parties and shall be entitled to retain recovery from such enforcement. Upon
Triangle's undertaking to pay all expenditures reasonably incurred by
Licensor, each Licensor shall reasonably cooperate in any such enforcement
and, as necessary, join as a party therein. After first deducting its costs
and expenses incurred in respect of enforcement (to the extent not otherwise
awarded by settlement or a court), Triangle shall pay Licensor Royalties
(calculated per Section 3.3) on the balance of any monetary recovery to the
extent such monetary recovery is held to be a reasonable royalty or damages
in lieu thereof. In the event that Triangle does not file suit against or
commence settlement negotiations with a substantial infringer of Licensor's
Patent Rights within [*] after receipt of a written demand from Licensor that
Triangle bring suit, then the parties will consult with one another in an
effort to determine whether a reasonably prudent licensee would institute
litigation to enforce the patent in question in light of all relevant
business and economic factors (including, but not limited to, the projected
cost of such litigation, the likelihood of success on the merits, the
probable amount of any damage award, the prospects for satisfaction of any
judgment against the alleged infringer, the possibility of counterclaims
against Triangle and Licensor, the diversion of Triangle's human and economic
resources, the impact of any possible adverse outcome on Triangle and the
effect any publicity might have on Triangle's and Licensor's respective
reputations and goodwill). If the parties cannot agree, the determination
will be made by a mutually and reasonably acceptable third party consultant.
If after such process, it is determined that a suit should be filed and
Triangle does not file suit or commence settlement
* CONFIDENTIAL TREATMENT REQUESTED
11.
negotiations forthwith against the substantial infringer, then Licensor shall
have the right to enforce any patent licensed hereunder on behalf of themselves
and Triangle (Licensor retaining all recoveries from such enforcement).
10. WARRANTY; DISCLAIMER.
10.1 Each Licensor represents and warrants to Triangle that the
Licensors (separately or jointly as applicable) (i) are the sole owners of all
right, title and interest in the Patent Rights and, except for Licensor's
obligations pursuant to the Approved Agreements, have not received written
notice of any ownership claim by a third party relating to the Technology, (ii)
are not parties to any other agreement with respect to the Patent Rights and,
except for Licensor's obligations pursuant to the Approved Agreements, the
Technology (iii) have not assigned, transferred, licensed, pledged or otherwise
encumbered the Patent Rights, except for Licensor's obligations pursuant to the
Approved Agreements, the Technology (iv) have full power and authority to enter
into this Agreement and to grant the License, (v) without having made any
independent investigation thereof, are not aware of any actual or potential
violation, infringement or misappropriation of any third party's rights (or any
claim or potential claim thereof) by the Patent Rights or the Technology, and
(vi) are not aware of any questions or challenges with respect to the
patentability or validity of any claims of any existing patents or patent
applications included in the Patent Rights or relating to the Technology.
Licensor will promptly notify Triangle of any change in such information or
circumstances of which it becomes aware.
10.2 EXCEPT AS EXPRESSLY PROVIDED ABOVE OR ELSEWHERE IN THIS
AGREEMENT, LICENSOR MAKES NO WARRANTY WITH RESPECT TO ANY TECHNOLOGY, GOODS,
SERVICES, RIGHTS OR OTHER SUBJECT MATTER OF THIS AGREEMENT AND HEREBY DISCLAIMS
WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO
ANY AND ALL OF THE FOREGOING.
11. TERM AND TERMINATION.
11.1 The term of this Agreement shall extend from the Effective
Date to the end of the term of the last to expire of the patents that have
been or may be issued within the Patent Rights. Upon expiration, Triangle
will be entitled to fully exploit Patent Rights and Technology without
restriction or payment of Royalties or any other amounts.
11.2 This Agreement will earlier terminate:
(a) automatically if Triangle shall enter liquidating bankruptcy
and/or if the business of Triangle shall be placed in the hands of a receiver,
assignee, or trustee, whether by voluntary act of Triangle or otherwise;
provided that if it is
12.
involuntary, termination shall not take place unless the act is not reversed
within one hundred twenty (120) days.
(b) in the event Triangle fails to pay to Licensor any amounts
due under Section 3 within thirty (30) days after Triangle has received from
Licensor written notice of such failure; PROVIDED, that Licensor shall not be
entitled to terminate this Agreement if Triangle disputes any amount Licensor
believes is required to be paid, so long as Triangle pays any disputed amount
into a mutually and reasonably acceptable escrow. The funds deposited into such
escrow shall be released pursuant to the subsequent agreement of the parties, or
failing such agreement, then pursuant to the judgment of a court pursuant to
Section 17.2.
(c) upon thirty (30) days written notice given by Triangle with
or without cause.
11.3 Upon any termination of this Agreement, nothing herein shall be
construed to release any party from any liability for any obligation incurred
through the effective date of termination (e.g., confidentiality and payment of
then accrued Royalties) or for any breach of this Agreement prior to the
effective date of such termination. Termination is not the sole remedy under
this Agreement and, whether or not termination is effected, all other remedies
will remain available. Triangle or any Affiliate, sublicensee, transferee or
assignee may, after the effective date of such termination, sell all Licensed
Products that it has on hand at the date of termination and may meet any then
existing supply obligations, provided that it pays earned Royalties thereon as
provided in this Agreement.
11.4 Neither party shall incur any liability whatsoever for any
damage, loss or expenses of any kind suffered or incurred by the other arising
from or incident to any termination of this Agreement (or any part thereof) by
such party which complies with the terms of the Agreement whether or not such
party is aware of any such damage, loss or expenses.
12. INCIDENTAL AND CONSEQUENTIAL DAMAGES. NEITHER PARTY WILL BE LIABLE
UNDER ANY CONTRACT, NEGLIGENCE, STRICT LIABILITY OR OTHER THEORY FOR ANY
INCIDENTAL OR CONSEQUENTIAL DAMAGES OR LOST PROFITS WITH RESPECT TO ANY SUBJECT
MATTER OF THIS AGREEMENT.
13. INDEPENDENT CONTRACTORS. The parties are independent contractors and
not partners, joint venturers or otherwise affiliated and neither has any right
or authority to bind the other in any way.
14. ASSIGNMENT. The rights and obligations of the parties under this
Agreement may not be assigned or transferred without the prior written consent
of the other party (which consent shall not be unreasonably withheld) except (a)
this
13.
Agreement and the rights and obligations hereunder may be assigned by Triangle
to (i) an acquiror of all or substantially all the assets, business or stock of
Triangle or (ii) and Affiliate, and (b) the right to receive Royalties may be
assigned by either or both Licensors to any trust for their benefit and/or the
benefit of their spouse, children and/or parents.
15. RIGHT OF FIRST REFUSAL. Triangle shall have a right of first refusal
to fund research in the anti-viral and/or anti-cancer fields (and obtain any
resulting assignment or license of inventions or proprietary rights) in the
laboratory of either Xxxxxxxxx or Xxxxxx. Prior to entering into any agreement
(or permitting any academic or other institution at which they may be conducting
research to enter into any agreement) with a third party to fund research or
grant rights to resulting inventions or proprietary rights, Xxxxxxxxx and Xxxxxx
shall notify Triangle in writing of the terms of any such proposed agreements
and shall include in such notice copies of any proposed agreements. Such notice
shall be deemed an offer to Triangle to enter into such agreements. Triangle
shall have thirty (30) days to accept the offer contained in such notice. Upon
acceptance by Triangle, such agreement(s) shall be binding between Triangle and
Xxxxxxxxx or Xxxxxx, as applicable. If Triangle does not accept such offer
within such thirty (30) day period, Xxxxxxxxx or Xxxxxx, as applicable, shall be
entitled, for a period of ninety (90) days after the expiration of the thirty
(30) day period, to enter into such agreements with such third party on the
terms presented and offered to Triangle. If Xxxxxxxxx or Xxxxxx, as applicable,
does not enter into such agreements with such third party on the terms presented
and offered to Triangle within such ninety (90) day period, then Xxxxxxxxx or
Xxxxxx (as applicable) must again comply with the terms of this Section 15
before entering into such agreements. This right of first refusal shall
terminate as to, respectively, each of Xxxxxxxxx and Xxxxxx if and when the
Consulting Agreement for each of them is terminated; provided that such
termination shall not affect any agreements the parties may have entered into
pursuant to this Section 15 prior to such termination or the obligations of the
parties under this Section 15 prior to such termination.
16. UCSD. In the event Triangle desires to obtain a license from UCSD
relating to any technology or proprietary rights, at Triangle's request Licensor
shall use its best efforts to facilitate the license to Triangle on terms that
Triangle in good faith determines are reasonable (and Licensor shall have no
right to prevent Triangle from entering into a license agreement that is
mutually acceptable to Triangle and UCSD). Licensor shall promptly notify
Triangle of any change in the UCSD patent policy, and shall promptly provide
Triangle with a copy of any new UCSD patent policy.
17. MISCELLANEOUS.
17.1 AMENDMENT AND WAIVER. Except as otherwise expressly provided
herein, any provision of this Agreement may be amended and the observance of any
provision of this Agreement may be waived (either generally or any particular
instance and either retroactively or prospectively) only with the written
consent of the parties.
14.
17.2 GOVERNING LAW AND LEGAL ACTIONS. This Agreement shall be
governed by and construed under the laws of the State of North Carolina and the
United States without regard to conflicts of laws provisions thereof. The sole
jurisdiction and venue for actions related to the subject matter hereof shall be
the North Carolina state and U.S. federal courts having within their
jurisdiction the location of Triangle's principal place of business. Both
parties consent to the jurisdiction of such courts and agree that process may be
served in the manner provided herein for giving of notices or otherwise as
allowed by North Carolina or federal law. In any action or proceeding to
enforce rights under this Agreement, the prevailing party shall be entitled to
recover costs and attorneys' fees.
17.3 HEADINGS. Headings and captions are for convenience only and are
not to be used in the interpretation of this Agreement.
17.4 NOTICES. Notices under this Agreement shall be sufficient only
if personally delivered, delivered by a major commercial rapid delivery courier
service or mailed by certified or registered mail, return receipt requested to a
party at its addresses set forth in the signature block below or as amended by
notice pursuant to this subsection. Notices shall be deemed delivered upon
actual receipt.
17.5 ENTIRE AGREEMENT. This Agreement supersedes all proposals, oral
or written, all negotiations, conversations, or discussions between or among the
parties relating to the subject matter of this Agreement and all past dealing or
industry custom.
17.6 FORCE MAJEURE. Neither party hereto shall be responsible for any
failure to perform its obligations under this Agreement (other than obligations
to pay money or obligations under Section 6) and the remedies of the other party
hereunder shall not apply if such failure is caused by acts of God, war,
strikes, revolutions, lack or failure of transportation facilities, laws or
governmental regulations or other causes which are beyond the reasonable control
of such party. Obligations hereunder, however, shall in no event be excused but
shall be suspended only until the cessation of any cause of such failure. In
the event that such force majeure should obstruct performance of this Agreement
for more than six (6) months, the parties hereto shall consult with each other
to determine whether this Agreement should be modified. The party facing an
event of force majeure shall use its commercially reasonable efforts to remedy
that situation as well as to minimize its effects.
17.7 EXPORT CONTROL. Each party hereby agrees to comply with all
export laws and restrictions and regulations of the Department of Commerce or
other United States or foreign agency or authority, and not to knowingly export,
or allow the export or re-export of any Proprietary Information, Licensed
Product or derivative of a Licensed Product in violation of any such
restrictions, laws or regulations, or, without all required licenses and
authorizations, to Afghanistan, the People's Republic of China or any Group Q,
S, W, Y or Z country specified in the then current Supplement Xx. 0 xx Xxxxxxx
000
00.
of the U.S. Export Administration Regulations (or any successor supplement or
regulations).
17.8 SEVERABILITY. If any provision of this Agreement is held
illegal, invalid or unenforceable by a court of competent jurisdiction, that
provision shall be limited or eliminated to the minimum extent necessary so that
this Agreement shall otherwise remain in full force and effect and enforceable.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
16.
IN WITNESS WHEREOF, the parties have caused their duly authorized
representatives to execute this AGREEMENT.
TRIANGLE PHARMACEUTICALS, INC.:
By: /s/ Xxxxx Xxxxx
_____________________________________
Its: Chairman and Chief Executive Officer
_____________________________________
Address: 0000 Xxxx Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx Xxxx, Xxxxx Xxxxxxxx 00000
Phone: (000) 000-0000
LICENSOR:
/s/ Xx. Xxxx Xxxxxxxxx
______________________________________
Xx. Xxxx Xxxxxxxxx
Address: 00000 Xxx Xx. Xxxxxxx
Xxx Xxx, Xxxxxxxxxx 00000
Phone: (000) 000-0000
/s/ Xx. Xxxxxx Xxxxxx
______________________________________
Xx. Xxxxxx Xxxxxx
Address: Department of Medicine
000 Xxxxxxxx Xxxxxxxx Xxxxxxxx
Xx Xxxxx, Xxxxxxxxxx 00000-0000
Phone: (000) 000-0000
17.
