LICENSE AGREEMENT
CONFIDENTIAL
MATERIALS OMITTED AND FILED SEPARATELY WITH
THE
SECURITIES AND EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS.
EXHIBIT
10.16
THIS
LICENSE AGREEMENT (the “Agreement”) is entered into as
of this 25 day of November, 2007 (the “Effective Date”), by and among
BioLine Innovations Jerusalem, LP, a limited partnership formed and existing
under the laws of the State of Israel, having a place of business at 00 Xxxxxx
Xxxxxx, X.X. Xxx 00000, Xxxxxxxxx, 00000, Xxxxxx (“BioLine”), and Innovative
Pharmaceutical Concepts (IPC) Inc., a company formed and existing under the laws
of the British Virgin Islands, having a place of business at Xxxxxx Xxxxx, 0xx
Xxxxx, 333 Waterfront Drive, P.O. Box 3339, Road Town, Tortola, British Virgin
Islands (“Licensor”).
NOW, THEREFORE, for good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto, intending to be legally bound, hereby agree as
follows:
Whenever
used in this Agreement with an initial capital letter, the terms defined in this
Section 1, whether used in the singular or the plural, shall have the meanings
specified below.
“Additional Ingredient” shall
mean any compound or substance which (i) is contained in a product and (ii) when
administered to a patient has a therapeutic or prophylactic clinical effect
independent of a Licensed Product, either directly or by acting synergistically
with or otherwise enhancing the effect of other compounds or substances
contained in such product.
“Affiliate” shall mean, with
respect to a party, any person, organization or entity controlling, controlled
by or under common control with, such party, including, with respect to a
limited partnership, its limited partners, general partners, and any person,
organization or entity controlling, controlled by or under common control with,
such party. For purposes of this definition only, “control” of
another person, organization or entity shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the activities,
management or policies of such person, organization or entity, whether through
the ownership of voting securities, by contract or otherwise. Without
limiting the foregoing, control shall be presumed to exist when a person,
organization or entity (i) owns or directly controls fifty percent (50%) or more
of the outstanding voting stock or other ownership interest of the other
organization or entity, or (ii) possesses, directly or indirectly, the power to
elect or appoint fifty percent (50%) or more of the members of the governing
body of the organization or other entity.
1
“Calendar Quarter” shall mean
the respective periods of three (3) consecutive calendar months ending on March
31, June 30, September 30 or December 31, for so long as this Agreement is in
effect.
“Combination Product” shall
mean a product, substance or devise which comprises a Licensed Product and at
least one Additional Ingredient.
“Commercially Reasonable
Efforts” shall mean (i) with respect to any objective by an entity,
reasonable, diligent, good faith efforts to accomplish such objective as other
entities in the business of such entity (together with its Affiliates as a
group) would normally use in the ordinary course of business and research to
accomplish a similar objective under similar circumstances; and (ii) with
respect to research, development and commercialization of any Licensed Product
hereunder, shall mean those efforts and resources normally used by other
entities in the business of such entity (together with its Affiliates as a
group) for a product owned by it or to which it has rights, which is of similar
market potential at a similar stage in its development or product life as such
Licensed Product.
“Development Plan” shall have
the meaning set out in Section 5.1.
“Development Results” shall
mean all data, summaries, analyses, reports and other results and information
relating to the Licensed Technology generated by or on behalf of BioLine in the
exercise of its rights and its performance under this Agreement.
“First Commercial Sale” shall
mean the first sale of a Licensed Product by BioLine, an Affiliate of BioLine or
a Sublicensee to an unaffiliated third party after Regulatory Approval has been
achieved in the country in which such Licensed Product is sold. Sales
for test marketing, sampling and promotional uses, clinical trial purposes or
compassionate or similar use shall not be considered to constitute a First
Commercial Sale.
“FDA” shall mean the United
States Food and Drug Administration.
“Government Programs” shall
mean the Biotech Incubators Program of the Office of the Chief Scientist of the
Israeli Ministry of Industry and Trade, and any other funding programs sponsored
by the Israeli or other governments.
“Grants” shall mean any funds
or benefits received by BioLine from governmental, quasi-governmental or other
non-profit sources for the development of Licensed Products or other benefits,
including but not limited to grants provided within the context of Government
Programs.
“IND” shall mean (i) an
Investigational New Drug Application, as defined in the U.S. Federal Food, Drug,
and Cosmetic Act, as amended, and the regulations promulgated thereunder, that
is required to be filed with the FDA before beginning clinical testing of a
Licensed Product in human subjects, or any successor application or procedure,
and (ii) any comparable application filed with a Regulatory Agency in any other
country or jurisdiction.
2
“Licensed Product” shall mean
any product that comprises, contains or incorporates Licensed
Technology.
“Licensed Technology” shall
mean the Licensed Patents, and all inventions, know-how and other intellectual
property owned by or licensed to Licensor related thereto.
“Licensed Patents” shall mean
(i) the patents and/or patent applications set forth on Exhibit A attached
hereto, (ii) all national-phase member patents and patent applications
corresponding thereto, (iii) all improvements, updates, modifications and
enhancements thereto made by Licensor by the Effective Date (if any), and (iv)
all provisional applications, continuations, continuations-in-part, divisions,
reissues, renewals, and patents granted thereon, all patents-of-addition,
reissue patents, re-examinations and extensions or restorations by existing or
future extension or restoration mechanisms, including, without limitation,
supplementary protection certificates or the equivalent thereof, all related to
the foregoing. Exhibit A shall
include and shall be updated from time to time to reflect inclusion of new
Licensed Patents.
“M&A Transaction” shall
mean a transaction in which all or substantially all of the partnership
interests of BioLine and/or all or substantially all of the assets or share
capital of its general and/or limited partner(s) are acquired by or assigned to
a third party.
“Net Sales” shall mean the
gross amount billed or invoiced by or on behalf of BioLine and/or its Affiliates
(the “Invoicing Entity”)
on sales of Licensed Products (whether made before or after the First Commercial
Sale of the Licensed Product), less the following:
(a) customary trade, quantity, or cash discounts to the extent actually allowed
and taken; (b) amounts repaid or credited by reason of rejection or return; (c)
to the extent separately stated on purchase orders, invoices, or other documents
of sale, any taxes or other governmental charges levied on the production, sale,
transportation, import, export, delivery, or use of a Licensed Product which is
paid by or on behalf of the Invoicing Entity; (d) payment to one or more third
parties to obtain a Third Party License from such third party(ies) in order to
practice the Licensed Technology; and (e) outbound transportation, packing and
delivery charges, as well as prepaid freight (including shipping insurance)
actually incurred; provided,
however, that:
(i) In
any transfers of Licensed Products between the Invoicing Entity and an Affiliate
of the Invoicing Entity not for the purpose of resale by such Affiliate, Net
Sales shall be equal to the fair market value of the Licensed Products so
transferred, assuming an arm’s length transaction made in the ordinary course of
business; and
(ii) In
the event that the Invoicing Entity, or the Affiliate of the Invoicing Entity,
receives non-monetary consideration for any Licensed Products or in the case of
transactions not at arm’s length with a non-Affiliate of the Invoicing Entity,
Net Sales shall be calculated based on the fair market value of such
consideration or transaction, assuming an arm’s length transaction made in the
ordinary course of business.
3
Sales of
Licensed Products by an Invoicing Party to an Affiliate of such Invoicing Party,
for resale by such Affiliate, shall not be deemed Net Sales and Net Sales shall
be determined based on the total amount invoiced or billed by such Affiliate on
resale to an independent third party purchaser.
“Regulatory Agency” shall mean
the FDA or equivalent agency or government body of another country.
“Regulatory Approval” shall
mean (i) approval by the FDA permitting commercial sale of a Licensed Product,
or (ii) any comparable approval permitting commercial sale of a Licensed Product
granted by the applicable Regulatory Agency in any other country or
jurisdiction.
“Sublicense” shall mean any
right granted, license given, or agreement entered into, by BioLine to or with
any other person or entity, under or with respect to or permitting any use of
any of the Licensed Technology (or any part thereof) or otherwise permitting the
development, manufacture, marketing, distribution and/or sale of Licensed
Products (regardless of whether such grant of rights, license given or agreement
entered into is referred to or is described as a sublicense or as an agreement
with respect to the development and/or manufacture and/or sale and/or
distribution and/or marketing of Licensed Products).
“Sublicense Receipts” shall
mean any payments or other consideration that BioLine or an Affiliate of BioLine
actually received in connection with a Sublicense, or the grant of an option to
obtain a Sublicense, including without limitation royalties, license fees,
milestone payments, license maintenance fees and equity; provided, however, that in
the event that BioLine or an Affiliate of BioLine receives non-monetary
consideration in connection with a Sublicense or the grant of an option to
obtain a Sublicense or in the case of transactions not at arm’s length,
Sublicense Receipts shall be calculated based on the fair market value of such
consideration or transaction, assuming an arm’s length transaction made in the
ordinary course of business; and provided further that
Sublicensing Receipts will be reduced by any amounts returned by BioLine or an
Affiliate to a Sublicensee on account of refunds or rebates given in respect of
Sublicense Receipts or payment to one or more third parties to obtain a Third
Party License from such third party(ies) in order to practice the Licensed
Technology. For the avoidance of doubt, Sublicensing Receipts shall
not include any amounts received as Grants, in connection with Government
Programs, or otherwise as research grants from national or international
not-for-profit funding bodies, or in connection with an M&A
Transaction.
“Sublicensee” shall mean a
person or entity granted a Sublicense in accordance with Section 2.2, including
any sublicensees of other Sublicensees.
“Third Party License” shall
mean a license from an unaffiliated third party to one or more valid and
enforceable patents issued in the United States or any other jurisdiction, the
claims of which cover one or more functional components that is essential for
the efficacy of the Licensed Product.
4
“Trial” shall mean a clinical
trial or trials performed by BioLine or a third party engaged by BioLine either
in countries of the European Union or in the USA, as part of Phase I and Phase
II clinical trials, pursuant to which treatment based on the Licensed Technology
is administered to not less than sixty (60) subjects. It is agreed that
following the receipt of the Trial's Final Clinical Study Report from the
Clinical Research Organization (CRO), it shall have the right to treat more
subjects in Israel.
2.2.2. Sublicense
Agreements. Sublicenses shall only be granted pursuant to
written agreements. BioLine shall provide Licensor with a copy of
each sublicense agreement within (30) days of receipt of an executed draft
thereof from the Sublicensee. Each such sublicense agreement shall
contain, inter alia,
provisions to the following effect:
2.2.2.1. All provisions
necessary to ensure BioLine’s ability to perform its obligations under this
Agreement, including reporting and audit requirements;
2.2.2.2. In the
event of termination of the license set forth in Section 2.1 above (in whole or
in part – e.g. termination in a particular country), any existing agreements
that contain a Sublicense of, or other grant of right with respect to, Licensed
Technology shall terminate to the extent of such Sublicense or other grant of
right; provided,
however, that, for each Sublicensee, upon termination of the Sublicense
agreement with such Sublicensee, if the Sublicensee is not then in breach of
such Sublicense agreement with BioLine such that BioLine would have the right to
terminate such Sublicense, Licensor shall be obligated, at the request of such
Sublicensee, to enter into a new agreement with such Sublicensee on
substantially the same terms as those contained in such Sublicense agreement;
and provided, further,
that such terms shall be amended, if necessary, to the extent required to ensure
that such Sublicense agreement does not impose any obligations or liabilities on
Licensor which are not included in this Agreement; and
5
2.2.3. A
Sublicensee shall be entitled to Sublicense its rights under a Sublicense
agreement, and so forth through a chain of sublicenses, provided that each such
sublicense shall be subject to execution of a written agreement consistent with
the terms of this Section, and shall be made for consideration and in arm’s
length transactions.
2.3. Contractors and
Affiliates. BioLine shall have the right to utilize third
party contractors in connection with BioLine’s activities in exploiting the
license granted hereunder. Provided that such contractors perform
activities on BioLine’s behalf, and BioLine
maintains control of and remains solely responsible for such activities, the
provisions of Section 2.2 shall not apply with respect to such
contractors. Sublicenses to Affiliates of BioLine shall not be
considered Sublicenses under this Agreement.
Subject
to the license granted to BioLine pursuant to the terms of this Agreement, all
rights, title and interest in and to the Licensed Technology are and shall be
owned solely and exclusively by Licensor. Licensor shall not accept
any funding from any third party for research relating or connected to the
Licensed Technology without the prior written consent of BioLine.
4.2. [***]
[***] Omitted pursuant to a confidential
treatment request. The confidential portion has been filed separately with the
SEC.
6
4.4. No
Warranty. Nothing contained herein shall be deemed to be a
warranty by any of the parties that they can or will be able to obtain patents
on patent applications included in the Licensed Patents, or that any of the
Licensed Patents will afford adequate or commercially
worthwhile protection.
[***]
Omitted
pursuant to a confidential treatment request. The confidential portion has been
filed separately with the SEC.
7
6.1.1. [***] shall be paid
to Licensor within ten (10) days following
the execution of this Agreement.
6.1.2. [***]
6.1.2.1. [***]
6.1.2.2. [***]
6.1.3. [***]
[***]
Omitted
pursuant to a confidential treatment request. The confidential portion has been
filed separately with the SEC.
8
6.1.4. The
License Fee shall be non-refundable.
(a) the
number of units of Licensed Products sold by BioLine and its Affiliates in each
country for the applicable Calendar Quarter;
(b) the
gross amount billed for the Licensed Product sold by BioLine and its Affiliates
in each country during the applicable Calendar Quarter;
[***]
Omitted
pursuant to a confidential treatment request. The confidential portion has been
filed separately with the SEC.
9
(c) a
calculation of Net Sales for the applicable Calendar Quarter in each country,
including a listing of applicable deductions;
(d) the
total amount payable to Licensor in U.S. dollars on Net Sales for the applicable
Calendar Quarter, together with the exchange rates used for conversion on the
date that the sale was recognized in accordance with IFRS (IAS 21);
and
(e) a
calculation of any Sublicense Receipts for the applicable Calendar
Quarter.
The
report shall state if no amounts are due to Licensor for any Calendar
Quarter.
10
11
12
13
[***] Omitted pursuant to a confidential
treatment request. The confidential portion has been filed separately with the
SEC.
14
10.1.1. Licensor
hereby represents and warrants that (i) it has sole and exclusive ownership of
the patents and/or patent applications listed in Exhibit A attached
hereto; (ii) it has not granted any rights in or to Licensed Technology that are
inconsistent with the rights granted to BioLine under this Agreement; (iii) it
has the right to grant the license granted under this Agreement free and clear
of any third party rights or claims; (iv) it will not transfer, assign, grant
rights to, sell, lease or otherwise dispose of or encumber the Licensed
Technology other than as may be expressly permitted herein; and (v) there are no
legal claims, demands, threats or proceeding of any sort by any third party
against the Licensor contesting the ownership or validity of the Licensed
Patents, or claiming that the practice of the Licensed Patents in the manner
contemplated by this Agreement would infringe the rights of such third
party.
10.1.2. BioLine
hereby represents and warrants that it (i) is a drug development company, (ii)
has received and carefully reviewed, to its satisfaction, all the information it
considers necessary or appropriate for deciding whether to enter into this
Agreement, and (iii) has reached the decision to fulfill its obligations
hereunder as a result of careful consideration. Without derogating
from the aforementioned, BioLine further represents that it has had an
opportunity to ask questions of and receive answers from Licensor regarding the
intellectual property and the inventions of Licensor and has performed its
independent due diligence with respect thereto after having received from
Licensor the due diligence materials it requested.
15
11.
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16
12.3.1. Termination Without Cause and for
Scientific, Regulatory or Medical Reasons.
12.3.1.1. BioLine may
terminate this Agreement without cause upon thirty (30) days prior written
notice to Licensor; provided,
however, that in the event that BioLine exercises such right prior to the
completion of the Trial, BioLine shall pay for the completion of the Trial; and
provided further that
the total amount that BioLine shall be obligated to pay in respect of the Trial
(including amounts spent by BioLine prior to the exercise of the termination
right hereunder, but excluding the Licensee Fee mentioned in Section 6.1) shall
in no event exceed the sum of six hundred thousand United States Dollars (US
$600,000). For the avoidance of doubt, BioLine shall not be obligated
to pay any amounts hereunder in the event that BioLine terminates the Agreement
pursuant to this subsection 12.3.1.1 after the completion of the
Trial.
12.3.1.2. BioLine may
terminate this Agreement at any time upon sixty (60) days’ prior written notice
to Licensor for scientific, regulatory or medical reasons which would prevent
BioLine from continuing the development of the Licensed Technology pursuant to
the Development Plan as may be determined by BioLine’s Scientific Advisory Board
(“SAB”). Prior to the
exercise of such right, Licensor shall have the right to present orally and/or
in writing its opinion regarding the proposed termination to the SAB and offer
its solutions for the obstacles and/or problems raised by the
SAB. For the purpose of preparing for its presentation to the SAB,
Licensor may contract with an independent expert to assist with such preparation
and such expert shall have the right to present before the
SAB. BioLine agrees to contribute up to [***] to offset any
documented costs directly incurred by Licensor in retaining such expert against
presentation of appropriate invoices. It is specifically agreed
between the parties that in the event that BioLine terminates the Agreement
pursuant to this subsection 12.3.1.2, regardless of whether such termination
occurs prior to the completion of the Trial, BioLine shall not be obligated to
pay any amounts in respect of the completion of the Trial.
12.3.2.1. In the event that
BioLine commits a material breach of its obligations under this Agreement and
fails to cure that breach within thirty (30) days after receiving written notice
thereof from Licensor, Licensor may terminate this Agreement immediately upon
written notice to BioLine. Notwithstanding the foregoing, in the
event that any
breach is not susceptible of cure within the stated period and BioLine uses
diligent good faith efforts to cure such breach, the stated period will be
extended by an additional thirty (30) days. In the event
of an uncured material breach by BioLine, Licensor may elect not to terminate
this Agreement but, instead, to xxx BioLine for damages arising from such
breach.
[***] Omitted pursuant to a confidential
treatment request. The confidential portion has been filed separately with the
SEC.
17
12.3.2.2. In the event that
Licensor commits a material breach of its obligations under this Agreement and
fails to cure that breach or default within thirty (30) days after receiving
written notice thereof from BioLine, BioLine may terminate this Agreement
immediately upon written notice to Licensor. Notwithstanding the
foregoing, in the event that any breach or default is not susceptible of cure
within the stated period and Licensor uses diligent good faith efforts to cure
such breach or default during the initial thirty (30) day cure period, the
stated period will be extended by an additional thirty (30) days. In
the event of an uncured material breach by Licensor, BioLine may elect not to
terminate this Agreement but, instead, to xxx Licensor for damages arising from
such breach.
12.3.3.1. Either
BioLine or Licensor may terminate this Agreement upon notice to the other if the
other party becomes insolvent, is adjudged bankrupt, applies for judicial or
extra-judicial settlement with its creditors, makes an assignment for the
benefit of its creditors, voluntarily files for bankruptcy or has a receiver or
trustee (or the like) in bankruptcy appointed by reason of its insolvency, or in
the event an involuntary bankruptcy action is filed against the other party and
not dismissed within ninety (90) days, or if the other party becomes the subject
of liquidation or dissolution proceedings or otherwise discontinues
business.
12.3.3.2. Notwithstanding the
foregoing, in the event a receiver or trustee (or the like) is appointed or
BioLine has entered into a settlement with its creditors and BioLine is
otherwise meeting its obligations pursuant to this Agreement, Licensor shall not
be entitled to terminate this Agreement as contemplated under Section 12.3.3.1
during such period.
18
13.
|
If
to BioLine:
|
BioLine
Innovations Jerusalem, LP
00
Xxxxxx Xxxxxx
X.X.
Xxx 00000
Xxxxxxxxx 00000
Xxxxxx
Attention: VP
Finance, BioLineRx, Ltd.
Fax: 000-0-000-0000
|
[***] Omitted pursuant to a confidential
treatment request. The confidential portion has been filed separately with the
SEC.
19
With
a copy (which shall not constitute notice) to:
|
Xxxxx
Xxxxx & Co., Law Offices
00
Xxxxxx Xxxxxx
Xxxxxxxxx,
00000
Israel
Attention: Xxxxx
Xxxxxxxxx, Adv.
Fax: 000-0-000-0000
|
|
If
to the Licensor:
|
Innovative
Pharmaceutical Concepts (IPC) Inc.
Xxxxxx
Xxxxx, 0xx Xxxxx, 000 Xxxxxxxxxx Xxxxx
P.O.
Box 3339, Road Town, Tortola
British
Virgin Islands
Attention:
Xx. X. Xxxxxxxx
Fax: 000-0-000-0000
|
|
With
a copy (which shall not constitute notice) to:
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Xxxxx
X. Xxxxx, Ashlagi, Fisher, Eshel – Law Offices
0
Xxxxxxx Xxxxxx
Xxx-Xxxx,
00000
Xxxxxx
Attention:
Xxx Xxxxxx, Adv.
Fax: 000-0-000-0000
Email:
xxx@xxxxxx.xx.xx
|
Any
notice shall be deemed to have been received as follows: (i) by personal
delivery, upon receipt; (ii) by facsimile or email, receipt confirmed, one
business day after transmission or dispatch; (iii) by airmail, three (3)
business days after delivery to the postal authorities by the party serving
notice.
20
[Remainder
of page intentionally left blank]
21
[Signature
page to License Agreement]
IN WITNESS WHEREOF, the
parties have caused this Agreement to be executed by their duly authorized
representatives as of the Effective Date.
Innovative
Pharmaceutical Concepts
|
BioLine
Innovations Jerusalem L.P.
|
(IPC)
Inc.
|
By
its General Partner:
|
BioLine
Innovations Jerusalem Ltd.
|
|
By:
/s/
X.
Xxxxxxxx
|
By:
/s/ Xxxxxx Xxxxxx /s/ Xxxxx
Xxxxxx
|
Name:
Xx. Xxxxxxx
Xxxxxxxx
|
Name:
________________________
|
Title:
Director
|
Title:
_________________________
|
22
Exhibit
A
Patents
and/or Patent Applications
[***]
[***] Omitted pursuant to a confidential
treatment request. The confidential portion has been filed separately with the
SEC.
23
Exhibit
B
Development
Plan
ID
|
Task
Name
|
Start
|
Finish
|
Cost
|
2005
|
2006
|
2007
|
2008
|
2009
|
2010
|
||||||||||
|
|
|
|
|
|
|
|
|
|
[***]
24
Non-surgical
removal of benign tumors and lesions of the skin
Development
Plan
[***]
[***] Omitted pursuant to a confidential
treatment request. The confidential portion has been filed separately with the
SEC.
25