EXHIBIT 10.5
DATED 17th September 1992
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BIOREX LABORATORIES LIMITED
- and -
GLYCYX PHARMACEUTICALS LIMITED
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LICENSE AGREEMENT
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Bristows, Xxxxx & Carpmael
00 Xxxxxxx'x Xxx Xxxxxx
Xxxxxx XX0X 0XX
Ref: 382/M/0000-000-0
WP Ref: LICAGR3N/MW
[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS
BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
I N D E X
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Page No.
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PARTIES 1
RECITALS 1
1. DEFINITIONS 1 - 5
2. REPRESENTATIONS AND WARRANTIES
2.1 Authorisation 5
2.2 No Other Representations 6
3. GRANT
3.1 Grant 6
3.2 Sublicenses 6 - 7
3.3 Documentation 7
4. DEVELOPMENT
4.1 Clinical Development and
Regulatory Approvals 7 - 8
4.2 Technical Information 8
4.3 Exchange of Data 8 - 9
4.4 Visit of Facilities 9
4.5 Conferences 9
4.6 Technical Assistance 9 - 10
4.7 Progress Reports 10
5. COMMERCIALISATION
5.1 Marketing 10
5.2 Termination for Failure to Market 10 - 11
5.3 Sole Remedy for Failure to Market 11
5.4 Excused Performance 11
6. MANUFACTURING: TRADE XXXX LICENSE
6.1 Clinical Materials 11
6.2 Manufacturing Technology 12
6.3 Trade Marks 12 - 13
7. PAYMENTS TO BIOREX
7.1 Biorex Fees 13
7.2 Profit Sharing 13 - 14
7.3 Sublicensee Retentions 14
7.4 Minumum Payments 14 - 17
7.5 Combination Product 17
7.6 No Patent Protection 17
7.7 Third Party Royalties 17
8. REPORTS AND ACCOUNTING
8.1 Reports 18
8.2 Audits 18 - 19
8.3 Confidential Financial Information 19
9. PAYMENT TERMS
9.1 Payment of Biorex Profit 19
9.2 Payment of Biorex Fees 19
9.3 Currency Conversion 19 - 20
9.4 Exchange Control 20
9.5 Late Payments 20
10. INFRINGEMENT
10.1 Infringement Rights 20
10.2 Enforcement of Patent Rights 20 - 21
10.3 Third Party Claims 21
ll. CONFIDENTIALITY
11.1 General 21 - 22
11.2 Exceptions 22
11.3 Licensed Information 22
11.4 Terms of this Agreement 22 - 23
12. PATENT PROSECUTION AND MAINTENANCE
12.1 Control 23
12.2 Expenses 23
12.3 Co-operation 23
13. TERM AND TERMINATION
13.1 Expiration 23 - 24
13.2 Termination for Cause 24
13.3 Termination by Glycyx 24
13.4 Termination by Biorex 24 - 25
13.5 Effect of Xxxxxxxxxxx 00 - 00
00. INDEMNITY
14.1 Glyxyx 26 - 27
14.2 Biorex 27
14.3 Procedure 00 - 00
00. XXXXX XXXXXXX 00
00. ASSIGNMENT 28 - 29
17. MISCELLANEOUS
17.1 Notices 29
17.2 Applicable Law 29
17.3 Export Laws 29
17.4 No Consequential Damages 29
17.5 Entire Agreement 30
17.6 Headings 30
17.7 Independent Contractors 30
17.8 Waiver 30
17.9 Further Assurances 30
17.10 Severability 31
SIGNATURES 31
EXHIBIT A - Patents and Patent Applications 32
EXHIBIT B - Regional Minimums 33
EXHIBIT C - Trade Xxxx Registrations and
Applications 34
This Agreement is made the 17th day of September 0000
X X X X X X X:
(1) BIOREX LABORATORIES LIMITED ("Biorex") a company incorporated in
England and Wales having its registered office at 2 Crossfield
Xxxxxxxx, Gladbeck Way, Xxxxxxx, Xxxxxxxxx, XX0 0XX, Xxxxxxx; and
(2) GLYCYX PHARMACEUTICALS LIMITED ("Glycyx") a company incorporated in
Bermuda having its registered office at Xxxxx Xxxxx, 00 Xxxxx Xxxxxx,
Xxxxxxxx, XX00, Xxxxxxx.
W H E R E A S:
A. By an agreement dated 18th March 1992 between Biorex and Glycyx (the
"Original Agreement"), Biorex granted to Glycyx an exclusive licence
to make, have made, use, sell and have sold products in the territory
(the terms products and territory being defined in the Original
Agreement).
B. Biorex and Glycyx now wish to replace the provisions of the Original
Agreement in their entirety with the provisions of this Agreement.
IT IS AGREED AS FOLLOWS:
1. DEFINITIONS
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For the purposes of this Agreement, the terms defined in this Article shall have
the meanings specified below:
1.1 "Affiliate" means any corporation or other entity which controls, is
controlled by, or is under common control with, a party to this
Agreement. A corporation or other entity shall be regarded as in
control of another corporation or entity if it owns or directly or
indirectly controls more than fifty percent (50%) of the voting stock
or other ownership interest of the other corporation or entity, or if
it possesses, directly or indirectly, the power to direct or cause the
direction of the management and policies of the corporation or other
entity.
1.2 "Balsalazide" means 5-[4(2-Carboxyethelcarbamoyl)-phenylazo]-
salicylic acid disodium salt dihydrate.
1.3 "Biorex Fees" means the fees payable to Biorex under Section 7.1.
1.4 "Biorex Profit" shall mean the share of the Profit payable to Biorex
under Section 7.2.
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1.5 "Canada-Mexico Agreement" means an agreement of even date with this
Agreement between Salix, Glycyx and Biorex.
1.6 "Commercial Introduction" of any Product shall mean the first sale for
use or consumption by the general public of such Product in a country
within the Territory after required marketing and, if required,
pricing approval has been granted by the governing health authority of
such country.
1.7 "Development Payments" means payments made to Glycyx by Third Parties
exclusively for
(a) development work and/or
(b) supply of materials provided by Glycyx
provided that such development work and/or supply
of materials are exclusively for the purposes of
(a) obtaining regulatory approval of the Products and/or
(b) conducting clinical trials or clinical studies to promote the
Products
in any region within the Territory.
1.8 "Factory Sale Price" means the ex factory sales price of each Product
actually charged by Glycyx or its Sublicensees (or any Affiliate of
Glycyx or its Sublicensees) for each shipment of Product on an arms
length open market basis to any Third Party (other than a Sublicensee
or Affiliate of a Sublicensee) net only of sales and purchase taxes,
customs or import duties, delivery charges and returns and allowances,
actually charged on each such shipment.
1.9 "Initial License Fees" shall mean any initial license fees received by
Glycyx in consideration of the grant of a Sublicense in the Territory
and shall not include Development Payments.
1.10 "Launch" means a commercial launch of the Product in a Principal
Market supported by such marketing expense and support and launched in
such quantities as may be appropriate for the Product to have a
significant effect on total sales of any similar or competitive
product in such Principal Market.
1.11 "MAA" means a product license application filed with the Medicines
Control Agency in the United Kingdom, or counterpart application for
marketing approval in any other country in the Territory, with respect
to a Product.
1.12 "Manufacturing Technology" shall mean all methods, processes, designs,
data, procedures and other
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information owned by or licensed to Biorex or its Affiliates during
the term of this Agreement that are reasonably required for pilot
production or commercial manufacturing of Products, including, without
limitation, final quality assurance-quality control procedures,
manufacturing procedures (including conditions times, temperatures,
pressures and rates), product and raw material specifications, and
other technology related thereto, including all patent and other
intellectual property rights thereto.
1.13 "Patent Rights" means all rights of Biorex in the Territory to any
subject matter claimed in or covered by any of the following:
1.13.1 The patents and applications listed in Exhibit A hereto, and any
continuations, continuations-in-part, divisions, substitutions,
renewals, reissues and extensions thereof.
1.13.2 Any and all other patent rights, now existing or hereafter acquired
(including applications therefore), pertaining to the subject matter
described in Section 1.13.1 above, or that are otherwise related to
Balsalazide, or to prodrugs, analogs or isomers thereof or
improvements of any of the foregoing, obtained in any country within
the Territory.
1.14 "Principal Markets" means United Kingdom, Sweden, Finland, Norway,
Switzerland, Austria, Denmark, Germany, Belgium, Netherlands,
Luxembourg, France, Republic of Ireland, South Africa, Australia, New
Zealand, Canada, Italy and Spain.
1.15 "Products" means products incorporating Balsalazide, whether or not
such products are covered by the Patent Rights, or any other material
whose manufacture, use or sale by an unlicensed third party would
constitute an infringement of any valid Claim (as defined below)
included within the Patent Rights.
1.16 "Profit" shall mean Glycyx' Net Sales Value of Supplies plus any
royalties or other fees or sums paid to Glycyx by Third Parties
relating to manufacture, use and/or sales of Products and/or use of
the Trade Marks, within the Territory; less Glycyx' Manufacturing
Costs of such Supplies. Notwithstanding the foregoing, "Profit" shall
not include Initial Licence Fees or Development Payments.
1.16.1 In Section 1.16, "Net Sales Value" means Glycyx' sales to Third
Parties, less, to the extent such amounts are included in the invoiced
sales price:
(a) actual credited allowance to such Third Parties
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for spoiled, damaged, out-dated and returned Supplies; (b) freight and
insurance costs incurred in transporting such Supplies to such Third
Party: (c) value-added and other direct taxes; and (d) customs duties
and surcharges and other governmental charges.
1.16.2 In Section 1.16, "Manufacturing Costs" of Supplies shall mean (i)
reasonable amounts paid by Glycyx to Third Party manufacturers for
such Supplies and (ii) those costs incurred by Glycyx in its own
manufacture of such Supplies which could be capitalised as inventory,
including raw material and actual direct labour costs and a proper
accounting of actual manufacturing overhead allocated to such units.
In each case, manufacturing costs shall also include costs incurred by
Glycyx in the processing of orders, shipments, and accounting for
Supplies sold by Glycyx.
1.17 "Report" means any report prepared pursuant to Section 8.1.
1.18 "Salix" means Salix Pharmaceuticals Inc., a company incorporated under
the laws of California having its principal place of business at 0000
X. Xxxxxxxx Xxxx, Xxxx Xxxx, Xxxxxxxxxx 00000.
1.19 "Sublicense" and "Sublicensee" have the meanings given by Sections
3.2.3 and 3.2.4.
1.20 "Sublicensee Retention" has the meaning given in Section 7.3.
1.21 "Supplies" means any and all of the following:-
(a) Products, and
(b) components of Products including without limitation ingredients,
intermediates, Balsalazide chemical or pharmaceutical dosage
forms of Products sold by Glycyx to Third Parties for (i) further
processing or packaging, and/or (ii) sale by Third Parties.
1.22 "Technical Information" means all formulae, raw material and product
specifications, designs and procedures, formulation data, processes
and methods, pharmacology, toxicology and other preclinical tests
results, clinical trials data and results, know-how, trade secrets,
inventions and other scientific, medical, technical and marketing data
and information, including all patent and other intellectual property
rights thereto, which: (a) are owned or controlled by, or licensed to,
Biorex or its Affiliates during the term of this Agreement, and (b)
that are reasonably necessary for the development, manufacture, sale
or use of Products. Technical Information shall include
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information and methods relating to the characterisation, synthesis,
formulation, stability, manufacture or assay of Balsalazide.
1.23 "Territory" means the entire world, but excluding the following
countries: United States (including its territories, possessions and
the Commonwealth of Puerto Rico), Japan, Korea and Taiwan. Subject to
the terms of Canada-Mexico Agreement, Canada and Mexico are included
in the Territory.
1.24 "Third Party" means any entity other than Glycyx or Biorex and their
respective Affiliates.
1.25 "Trade Xxxx" means the trade xxxx "Colazide" which Biorex has register
as a trade xxxx within the Territory in the countries set out in
Exhibit C.
1.26 "Trade Xxxx Royalties" shall mean the royalties payable to Biorex by
Glycyx pursuant to Section 6.3.5.1.
1.27 "Valid Claim" means a Claim of an issued and unexpired patent included
within the Patent Rights, which has not been held permanently revoked,
unenforceable or invalid by a decision of a court or other
governmental agency of competent jurisdiction, unappealable or
unappealed within the time allowed for appeal, and which has not been
admitted to be invalid or unenforceable through reissue or disclaimer
or otherwise.
2. REPRESENTATIONS AND WARRANTIES
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Authorisation
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2.1 Biorex represents and warrants that (i) it has the full right and
authority to grant the licenses provided in the Agreement and perform
its obligations hereunder; (ii) to the best of Biorex's knowledge,
Glycyx may exercise the licenses granted to it under the Agreement
without conflict with or infringement of any rights or alleged rights
of any person or entity; (iii) Biorex has not, and will not during the
term of this Agreement, make any commitment or incur any obligation in
conflict with the licenses granted in the Agreement; (iv) Biorex is,
at the date of this Agreement, the sole legal owner of the patents and
patent applications set out in Exhibit A and the trade xxxx
registrations and applications set out in Exhibit C; and (v) as of the
date of this Agreement, Biorex and its Affiliates have no patents or
patent applications within the Territory, other than those listed in
Exhibit A hereto, related to Balsalazide, or to prodrugs, analogs or
isomers thereof, or improvements or any of the foregoing.
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No Other Representations
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2.2 Except to the extent provided in this Article 2, Biorex makes no
representations, extends no warranties of any kind, either expressed
or implied, with respect to use, sale, or other disposition by Glycyx
or its Sublicensees or its vendees or other transferees of Products
incorporating or made by use or subject matter licensed under this
Agreement. THE WARRANTIES EXPRESSLY SET FORTH IN THIS ARTICLE 2 BY
EITHER PARTY ARE EXCLUSIVE AND NO OTHER WARRANTY, WRITTEN OR ORAL,
INCLUDING WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE, IS EXPRESSED OR IMPLIED.
3. GRANT
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Grant
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3.1 Biorex hereby grants to Glycyx the exclusive right and license under
the Patent Rights, the Technical Information and Manufacturing
Technology to develop, have developed, make, have made, use, sell and
have sold Products within the Territory. Notwithstanding the
foregoing, Biorex may authorise third parties to manufacture
Balsalazide within the Territory solely for sale and use outside of
the Territory.
3.2 Sublicenses
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3.2.1 The license granted to Glycyx under Section 3.1 above shall include
the right to grant Sublicenses within the Territory. Glycyx shall
provide Biorex with a copy of any Sublicense issued hereunder, which
copy shall be maintained in confidence pursuant to Section 11 hereof.
Notwithstanding the foregoing, except as provided in Section 3.2.4
below Glycyx shall not grant to any Third Party a Sublicence or
marketing rights for the manufacture or sale of a Product in any other
country within the Territory without first obtaining Biorex's consent,
which shall not be withheld unreasonably.
3.2.2 In the event that Glycyx receives from a Sublicensee hereunder notice
of a default by Glycyx that would give rise to a termination of the
Sublicense agreement, Glycyx shall promptly provide such notice to
Biorex. Except where Biorex enters into an agreement with the
Sublicensee to provide an alternative arrangement in such
circumstances, Glycyx shall ensure that the Sublicense agreement shall
provide that, in the event of such a breach by Glycyx and a failure
by, Glycyx to cure the breach within the cure period specified in the
Sublicense agreement, Biorex will have an additional period to cure
the breach and to assume
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Glycyx's rights and obligations under the Sublicense agreement.
3.2.3 Subject to Clause 3.2.4, in this Agreement the term "Sublicense" shall
mean any agreement under which Glycyx grants to a Third Party (the
"Sublicensee") rights to
(a) market, promote, and/or distribute Products in the Territory
using Supplies purchased from Glycyx; and/or
(b) make, have made, use and/or sell or have sold Products in the
Territory.
3.2.4 The following types of arrangements shall not be Sublicenses
hereunder:
(a) subcontracting of Third Parties to develop the Product or new
Products for Glycyx; or
(b) subcontracting of Third Parties to manufacture the Products or
ingredients for supply to Glycyx or its Sublicensees only.
Documentation
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3.3 Glycyx and Biorex agree to execute and file such formal patent
licenses and similar instruments as the other party may reasonably
request to evidence or perfect the licenses granted herein.
4. DEVELOPMENT
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4.1 Clinical Development and Regulatory Approvals
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4.1.1 Biorex shall assist in the completion of the clinical development and
in the obtaining of the necessary regulatory approvals in Biorex's
name to market a Product containing Balsalazide for the treatment of
ulcerative colitis in the United Kingdom; provided that Glycyx shall
be responsible for the preparation of all necessary experts' reports
to be included in any application for regulatory approval of a Product
pursuant to this paragraph. Glycyx shall procure that it and its
Sublicensees shall use commercially reasonable efforts to obtain all
necessary regulatory approvals to market a Product in each other
country within the Territory.
4.1.2 Subject to Section 5.4 below, if Glycyx or its Sublicensee has not
sought regulatory approval to market one or more Products in a country
within five (5) years after approval of the first MAA within the
Territory, and Glycyx does not, within one hundred and eighty (180)
days after receiving a written request from Biorex to do so, undertake
7
commercially reasonable efforts to obtain such approval and thereafter
continue such efforts, Biorex shall have the right to terminate
Glycyx's license under Section 3.1 above in respect of such country
upon written notice to Glycyx. The foregoing sets forth Biorex's sole
remedy for a failure by Glycyx to meet its obligations under this
Section 4.1.
4.1.3 Biorex and Glycyx acknowledge that additional pre-clinical and
clinical studies may be necessary in order to apply for and obtain
regulatory approvals in any country in the Territory, and hereby agree
to discuss plans for such studies should they be necessary and to
negotiate in good faith their respective rights and obligations
relative to conducting or having such studies conducted.
Technical Information
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4.2 Biorex shall promptly provide to Glycyx, and in any event at least
semi-annually, all Technical Information (including such regulatory
filings) and information that it develops or acquires after the date
hereof. In addition Biorex shall use all reasonable efforts to so
provide to Glycyx all similar items and information generated or
developed by or for other licensees of Biorex and to permit Glycyx to
use such items and information to the same extent it may use Technical
Information hereunder. Glycyx and Sublicensees hereunder shall have a
right to use all such Technical Information and information of such
other licensees for purposes of this Agreement, and to cross-reference
all such regulatory filings. In the event that Biorex does not obtain
from any other licensee of Biorex the right to permit Glycyx to use
such items or information, Biorex shall not provide to such licensee
any information of Glycyx provided to Biorex under Section 4.3 below.
Exchange of Data
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4.3 Each party shall keep the other informed as to its progress in the
development and testing of all Products and the preparing, filing and
obtaining of the approvals necessary for marketing such Products. Each
party shall notify the other at least thirty (30) days in advance of,
and make available to the other party for review prior to submittal,
all filings and correspondence to be submitted by such party (but not
by Third Parties) to regulatory authorities with respect to marketing
approval of such a Product, and all proposed publications by such
party of test data or results related to such Products. Such items
shall be made available at such party's principal place of
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business, or if reasonable to do so, they shall be sent to the other
party. Glycyx will provide Biorex with copies of any similar filings,
correspondence and proposed publications which it receives from its
Sublicensees. In addition, each party shall provide the other with
copies of such other documents as it reasonably requests promptly
after such request. Until the date of the Commercial Introduction of
each such Product, each party shall provide to the other semi-annual
reports summarising in reasonable detail its activities related to the
development and securing of the requisite marketing and other
regulatory approvals for such Products. After the Commercial
Introduction of any such Product, each party shall keep the other
informed of any further communications or activities concerning such
Products by, with or involving governmental health agencies.
Throughout the term of this Agreement, each party shall promptly
supply the other with all information regarding adverse drug
experiences.
Visit of Facilities
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4.4 Representatives of Glycyx and Biorex may, upon reasonable notice and
at times reasonably acceptable to the other party (a) visit the
facilities where the preclinical tests or clinical trials are being
conducted with respect to Products, and the facilities where the other
party manufactures any Product, or active compound contained therein
(or has such a product or compound manufactured, but subject always to
the consent of the relevant Sublicensee or subcontractor) to the
extent relating to such product or compound; and (b) consult
informally, during such visits and by telephone, with personnel of the
other party performing work on such tests, trials or manufacturing.
Conferences
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4.5 The parties shall meet periodically, at times and locations to be
agreed, to discuss their respective development programmes with
respect to such Product.
Technical Assistance
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4.6 Biorex shall provide to Glycyx such reasonable technical assistance as
is in Biorex's control, with respect to the development, preclinical
and clinical testing and manufacturing of Products. In addition,
Biorex agrees to use all reasonable efforts to provide technical
support and assistance to Sublicensees hereunder, including assisting
in prospective Sublicensees' evaluation of the Products. Biorex will
be reimbursed by Glycyx or
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such Sublicensee for its out-of-pocket expenses incurred in rendering
such assistance.
Progress Reports
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4.7 Glycyx shall provide to Biorex quarterly reports describing in
reasonable detail its progress and its Sublicensees' progress in
developing and securing marketing and regulatory approval of Products
hereunder. Such obligation shall continue until the Commercial
Introduction of the first Product, after which such reports shall be
provided semi-annually.
5. COMMERCIALISATION
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Marketing
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5.1 Subject to Sections 5.2 and 5.3 below, with respect to each Product
for which Glycyx or its relevant Sublicensee has received necessary
regulatory approvals to market such Product in a country within the
Territory, Glycyx shall itself or shall procure that its relevant
Sublicensee uses commercially reasonable efforts to procure:
5.1.1 the commencement of marketing of such Product in such country within
one hundred and eighty days (180) days of receiving approval
(including, if required, pricing and reimbursement approval) to market
such Product in that country; and
5.1.2 after commencing marketing of such Product in such country, to meet
and develop the market demand for such Product in such country.
Termination for Failure to Market
---------------------------------
5.2 If Glycyx or its relevant Sublicensee fails to fulfil the Section 5.1
obligations with respect to any Principal Market for which Glycyx or
its relevant Sublicensee has received necessary regulatory approvals
to market the Products then:-
5.2.1 If Glycyx or its relevant Sublicensee does not remedy such failure
within one hundred and twenty (120) days after receiving a written
request to do so, Biorex shall have the right to terminate Glycyx's
exclusive rights (other than Glycyx's exclusive right under Section
6.3 to use the Trade Xxxx) in that Principal Market upon written
notice to Glycyx; provided that this provision shall not apply to
countries in respect of which a minimum royalty or payment is being
paid under Section 7.4 as specified in Exhibit B; and
5.2.2 If Glycyx or its relevant Sublicensee has not fulfilled the Section
5.1 obligations within twelve
10
(12) months after receiving approvals, Biorex may terminate Glycyx's
rights in that Principal Market, including rights to use the Trade
Xxxx, provided that Biorex will not grant use of the Trade Xxxx by a
Third Party within that Principal Market.
Sole Remedy for Failure to Market
---------------------------------
5.3 Section 5.2 sets forth Biorex's sole remedies for a failure by Glycyx
to meet its obligations under Section 5.2.
Excused Performance
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5.4 In addition to the provisions of Article 15, Glycyx's obligations with
respect to any Product under Section 4.1. 7,4 or this Article 5 are
expressly conditioned upon the continuing absence of any adverse
condition relating to the safety, quality or efficacy of that Product
or any other restrictions or delays imposed or caused by governmental
authorities, or other condition or event beyond Glycyx's control that
would reasonably justify Glycyx, after consulting with Biorex, in
exercising prudent and justifiable business judgment, to conclude that
development or marketing of such Product should be delayed, suspended
or stopped altogether, and Glycyx's obligation to develop or market
any such Product shall be delayed or suspended so long as any such
condition or event exist, but for a maximum of five (5) years from the
commencement of such delay or suspension. In addition, Glycyx shall
not be responsible for any delays caused by failure of any health
regulatory agency to accept data provided by Biorex or by inability of
Glycyx to obtain, or delays in obtaining, sufficient quantities of
clinical materials on reasonable terms.
6. MANUFACTURING: TRADE XXXX LICENSE
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Clinical Materials
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6.1 Prior to the time that Glycyx has received adequate supply of
Products, Biorex shall use its commercially reasonable efforts to
supply, or to arrange for others to supply, Glycyx's requirements of
Products for preclinical tests and human clinical trails on reasonable
terms and conditions. In the event that Biorex arranges for Third
Parties to develop formulations of, or supply, Products to Biorex
under this Section 6.1, Biorex shall use commercially reasonable
efforts to acquire the right to include the manufacturing processes
and technology used by such Third Party for such Product in the
Technical Information, Manufacturing Technology or the Patent Rights,
so that Glycyx may use such process to manufacture such Product.
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Manufacturing Technology
------------------------
6.2 As soon as practicable following a request by Glycyx, Biorex shall
disclose to Glycyx all Manufacturing Technology in existence at such
time, and shall hereafter promptly (and in any event at least
quarterly) provide Glycyx with updates or additions to such
Manufacturing Technology that are subsequently developed or acquired
by Biorex or its Affiliates. In addition, Biorex shall use all
reasonable efforts to so provide to Glycyx all similar items and
information generated or developed by or for other licensees of Biorex
and to permit Glycyx to use such items and information to the same
extent it may use Manufacturing Technology hereunder.
6.3 Trade Marks
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6.3.1 Subject to the provisions of this Agreement, Biorex hereby grants to
Glycyx the exclusive right and license to use the Trade Xxxx in
connection with the exploitation of the Products in the Territory
throughout the term of this Agreement.
6.3.2 Glycyx shall have the right to grant Sublicensees the right to use the
Trade Xxxx in connection with the exploitation of the Products in the
Territory throughout the terms of this Agreement, subject to the
provisions of this Agreement.
6.3.3 Subject to the laws of the country concerned, Glycyx shall have an
exclusive right to institute and pursue actions to prevent misuse of
the Trade Xxxx throughout the Territory.
6.3.4 Biorex, Glycyx and its Sublicensees shall at the expense of Glycyx
execute such instruments and trade xxxx user agreements as are
necessary to enable Glycyx to exercise its rights under Clause 6.3.1
and to satisfy the requirements of national trade xxxx xxxx in respect
of trade xxxx user agreements.
6.3.5 The following provisions shall apply on the expiry of this Agreement
pursuant to Section 13.1.
6.3.5.1 Glycyx shall (subject to Section 6.3.5.2) pay to Biorex a royalty
equal to [*] of all Products supplied by Glycyx, Affiliates of Glycyx,
Sublicensees, or Affiliates of Sublicensees for consumption in the
Territory which are supplied by reference to the Trade Xxxx (the
"Trade Xxxx Royalties"). These Trade Xxxx Royalties shall continue to
be paid for as long as the Trade Xxxx is registered in any country in
the Territory.
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[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
6.3.5.2 Glycyx shall not be under any obligation to pay Trade Xxxx Royalties
in respect of Products supplied by a Sublicensee until Glycyx has
received equivalent royalties in respect of such Products from its
Sublicensee. Provided that Glycyx shall use all reasonable commercial
efforts to obtain prompt payment from its Sublicensees of such
equivalent royalties.
6.3.5.3 Glycyx shall itself, and shall procure that its Sublicensees, keep
true and accurate records of all Products supplied bearing the Trade
Xxxx and Glycyx shall within ninety days of the end of each semi-
annual period ending on 30th June and 31st December send Glycyx a full
statement showing the calculation of the Trade Xxxx Royalties due and
owing to Biorex.
6.3.5.4 Glycyx shall on the date such statement is due pay to Biorex the Trade
Xxxx Royalties due in respect of the semi-annual period covered by the
statement, in pounds sterling by express payment through the banking
system in such bank account as Biorex shall designate from time to
time for the purposes of receiving such payment.
6.3.5.5 The provisions of Sections 8.2.1, 8.2.2, 9.3, 9.4 and 9.5 shall apply
in relation to payment of the Trade Xxxx Royalties.
7. PAYMENTS TO BIOREX
------------------
Biorex Fees
-----------
7.1 Subject to Clause 2.3 of the Canada-Mexico Agreement Glycyx shall pay
to Biorex [*] received by Glycyx. The share of Initial License Fees
payable to Biorex under this Section 7.1 shall be referred to in this
Agreement as "Biorex Fees". It is understood that Glycyx may permit
Sublicensees to credit [*] against other amounts owing to Glycyx under
the Sublicense, provided that such credits are taken within the first
[*] after Commercial Introduction of the applicable Product by the
Sublicensee.
Profit Sharing
--------------
7.2 In addition to the Biorex Fees to be paid to Biorex under 7.1 above
and subject to Clause 7.3, Glycyx shall pay to Biorex [*] from the
sale of Supplies for consumption in countries within the Territory.
The share of the Profit payable to Biorex under this Section 7.2 shall
be referred to in this Agreement as "Biorex Profit". Biorex Profit
shall
13
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
be paid to Biorex quarterly in accordance with Sections 8.1 and 9.1
below, on the basis of unaudited financial statements of Glycyx for
the applicable quarter. However, the payment to Biorex for the final
quarter of a Glycyx fiscal year shall be made on the basis of Glycyx's
audited financial statements for such fiscal year, and such payment
shall be adjusted for the difference between the Profit as calculated
during the year and as reflected in such audited financial statements.
Notwithstanding Section 8.1 below, the Report and payment due under
this Section 7.2 for the final quarter of a Glycyx fiscal year shall
not be due until ninety (90) days after the end of such quarter.
Sublicensee Retentions
----------------------
7.3 Where Development Payments are made by a Sublicensee, Glycyx may allow
that Sublicensee to credit a proportion of such Development Payments
[*] against amounts owing to Glycyx under the Sublicense. Such amounts
credited in any quarter period shall be referred to in this Agreement
as "Sublicensee Retention". In such cases:-
(a) For the purpose of Clause 7.2 the term "Profit" shall mean the
Profit (as defined in Section 1.16) plus the Sublicensee
Retention, and Biorex Profit shall be calculated accordingly.
(b) Glycyx shall be entitled to deduct [*] the Sublicensee Retention
in respect of the relevant quarter from Biorex Profit.
[*]
7.4 Minimum Payments
----------------
Aggregate Minimum
-----------------
7.4.1 Glycyx shall pay to Biorex the amounts set forth in the table below
upon the earlier to occur of the corresponding Glycyx milestone or
date in such table, subject to Section 7.4.3 below. However, if Biorex
does not meet its corresponding obligation, the date by which the
milestone payment (and any
14
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
subsequent milestone payments) must be paid shall be delayed by the
amount of time of Biorex's delay.
MILESTONE/OBLIGATION
--------------------
Amount Date Glycyx Milestone Biorex Obligation
------ ---- ---------------- -----------------
[*]
In the event that Glycyx fails to meet the minimum payment obligations
under this Section 7.4.1, Glycyx shall pay to Biorex [*] (and pro rata
for any lesser period) until such failure is cured. In the event that
Glycyx fails to pay any of the amounts specified in this Section 7.4.1
within six (6) months of the due date, Biorex shall have the right to
terminate this Agreement on thirty (30) days written notice, with
respect to all countries in the Territory.
Regional Minimums
-----------------
7.4.2 Glycyx agrees that the aggregate Biorex Fees and Biorex Profit paid to
Biorex under Section 7.1 and 7.2 above (as the case may be) for each
region within the Territory shall equal at least the amounts set forth
in Exhibit B hereto. In the event Glycyx grants a single Sublicense
which includes rights to more than one region the amounts set forth in
Exhibit B shall be aggregated in respect of all regions under such
Sublicense for
15
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
the purposes of determining Glycyx's obligation and performance under
this Section 7.4.2. In the event that such Biorex Fees and Biorex Prof
it in any Glycyx fiscal year for a particular region do not equal or
exceed the minimum amounts for such year, the Report provided for the
final quarter of such year shall include a payment so that the total
amount paid for such region equals the minimum amounts for such year.
In the event that Glycyx does not pay such amount by the date such
Report is due, Biorex shall have the right to terminate Glycyx's
licenses in that region by giving Glycyx at least thirty (30) days
written termination notice within ninety (90) days after the due date
of such report. Glycyx may cure any such failure by paying the minimum
amount within such ninety (90) day period (or if longer, within the
30-day notice period), in which case Biorex's right to so terminate
Glycyx's license as a result of such nonpayment shall cease.
Credits
-------
7.4.3 Payments under this Section 7.4 and the Biorex Fees and Biorex Profit
paid to Biorex under Section 7.1 and 7.2 above, shall be offset
against each other as follows:
(a) Aggregate Minimums. The payments made to Biorex under Section 7.4.1
------------------
above may be carried forward and offset by Glycyx against Biorex Fees
and Biorex Profit. Similarly, any amounts actually paid to Biorex
under Sections 7.1 and 7.2 (net of such offsets) or 7.4.2 may be
carried forward and offset against payments subsequently due under
Section 7.4.1.
(b) Regional Minimums. Any amount paid to Biorex under Section 7.4.2
------------------
above with respect to a particular region may be carried forward and
offset by Glycyx against any Biorex Fees and Biorex Profit owing to
Biorex under Section 7.1 or 7,2 for the same region in any of the
three subsequent years which are in excess of the applicable minimum.
It is understood that amounts paid under Sections 7.1, 7.2 and 7.4.2
may be used as a credit under both subparagraphs (a) and (b) of this
Section 7.4.3 except as provided for in subparagraph (a).
No Other Remedies
-----------------
7.4.4. The remedies specified in this Section 7.4 are Biorex's sole remedies
with respect to Glycyx's failure to meet the agreed minimum payments.
In addition, Glycyx's obligation to meet the minimum payments set
forth in this Section 7.4 shall be
16
conditioned upon Biorex not unreasonably withholding or delaying
consent to any Sublicense proposed by Glycyx under Section 3.2 above.
Combination Product
-------------------
7.5 In the event a Product is sold in a combination product with other
biologically active components, Profit, for purposes of calculating
Biorex Profit on the combination product, shall be calculated by
multiplying the Profit (as the case may be) of the combination by the
fraction A/B, where A is the gross selling price of the Product sold
separately and B is the gross selling price of the combination
product. In the event that no such separate sales are made by Glycyx
or a permitted Sublicensee, Profit shall be reasonably allocated
between such Product and such other component, as mutually agreed by
Glycyx and Biorex. In the event Glycyx receives Initial License Fees
from such a combination product, the amounts attributable to the
Product shall be reasonably allocated by Glycyx on a similar basis.
No Patent Protection
--------------------
7.6 If Glycyx's first Product in a region is not covered by a Valid Claim
within the Patent Rights in any year, and significant sales are being
made by Third Parties (other than Sublicensees) in such region of a
substantially equivalent product that would infringe a Valid Claim in
another country within the Territory, [*] (even though the Product is
made in a country in which such manufacture infringes a Valid Claim)
provided that such significant sales of the substantially equivalent
product continue throughout the year in question.
Third Party Royalties
---------------------
7.7 In the event that Glycyx is required to pay to a Third Party any
royalties on a Product with respect to technology incorporated in such
Product other than the technology licensed hereunder, Glycyx may
deduct from Biorex Profit with respect to such Product [*] with
respect to such Product in any quarter period. For the avoidance of
doubt any such royalties paid to Third Parties shall not be included
as Manufacturing Costs as defined in Section 1.16.2.
17
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
8. REPORTS AND ACCOUNTING
----------------------
Reports
-------
8.1 After the Commercial Introduction of a Product, Glycyx shall furnish
to Biorex on a quarterly basis a written report-covering Glycyx's
fiscal quarters showing, on a country by country basis, (i) the
initial License Fees and the Development Payments received by Glycyx
during the reporting period; (ii) Biorex Profit payable in British
Pounds Sterling, which shall have accrued hereunder in respect of such
quarter; (iii) withholding taxes, if any, required by law to be
deducted in respect of such amounts; and (iv) the dates of the
Commercial Introductions of any Products in any country in the
Territory during the reporting period. Except as provided in 7.2
above, Reports shall be due forty-five (45) days following the close
of each respective quarter. Glycyx shall keep accurate records in
sufficient detail to enable the Profit to be determined. For the
avoidance of doubt, Glycyx shall be entitled to enter into Sublicenses
in which the Sublicensee is required to pay royalties on a semi-annual
basis. In case no Biorex Profit is due for any quarter period
hereunder, Glycyx shall so report.
8.2 Audits
------
8.2.1 Upon the written request of Biorex, at Biorex's expense and not more
than once each Glycyx fiscal year, Glycyx shall permit or procure an
independent public accountant selected by Biorex and reasonably
acceptable to Glycyx to have access during normal business hours to
such of the records of Glycyx, its Sublicensees and Affiliates as may
be reasonably necessary to verify the accuracy of the Reports made not
more than thirty-six (36) months prior to the date of such request.
Biorex may, at its discretion, require Glycyx to arrange such
verification of Sublicensee reports, Provided that Biorex shall only
have the above right of access to a Sublicensee's records in
circumstances where the amount of payments to be made by Glycyx to
Biorex is calculated wholly or partly by reference to the quantity or
price of Product manufactured or supplied by the Sublicensee (and/or
in the case of Trade Xxxx Royalties supplied by reference to the Trade
Xxxx).
8.2.2 In the event such accountant concludes that additional amounts were
owed daring such period, the additional amounts shall be paid
promptly, The fees charged by such accountant shall be paid by Biorex
unless the audit establishes that the amounts payable by Glycyx for
the audited period are more than one hundred and five percent (105%)
18
of the amounts actually paid for such period, in which case Glycyx
shall pay the reasonable fees and expenses charged by the accountant.
8.2.3 Upon the expiration of thirty-six (36) months following the date of
any Report, the calculation of Biorex Fees and Biorex Profit payable
with respect to the quarter covered by such Report shall be binding
and conclusive upon Biorex; and Glycyx shall be released from any
liability or accountability with respect to Biorex Fees and Biorex
Profit for such year.
Confidential Financial Information
----------------------------------
8.3 Biorex agrees that all information subject to review under this
Article 8 is confidential and shall cause its accountant to retain all
such information in confidence except for discussions with Biorex.
9. PAYMENT TERMS
-------------
Payment of Biorex Profit
------------------------
9.1 Subject to Section 9.2, amounts shown to have accrued by each Report
shall be due and payable on the date such Report is due; provided that
payments of Biorex Profit shall not be due until such Profit is
actually received by Glycyx. Glycyx shall use commercially reasonable
efforts to ensure prompt receipt of such Profits, Payment of such
amounts in whole or in part may be made in advance of such due date.
Amounts determined to be owing, and any overpayments to be credited,
with respect to any prior quarter shall be added, together with
interest thereon under Section 9.5 below from the date of the report
for the quarter for which such amounts are owing, or the date of such
overpayment, as the case may be, to the next quarterly payment
hereunder.
Payment of Biorex Fees
----------------------
9.2 Glycyx shall forthwith upon receipt of any Initial Licence Fees pay to
Biorex the corresponding Biorex Fees by express payment through the
banking system into such bank account as Biorex shall designate from
time to time for the receipt of such payments. In the period between
the receipt of any Initial License Fees by Glycyx and the despatch to
Biorex of the corresponding Biorex Fees, Glycyx shall hold Biorex Fees
as trustee for Biorex.
Currency Conversion
-------------------
9.3 All payments to Biorex shall be made in British
19
Pounds. Biorex Fees shall be first determined in the currency in which
such amounts are received by Glycyx and then converted to its
equivalent in British Pounds. The midpoint between the buying and
selling rates of exchange for such currency in British Pounds, as
quoted, in The Wall Street Journal (U.S. edition) as of the last
----------------------
business day of the quarter for which the calculation is made, shall
be used for such conversion, or such other benchmark as may be agreed
in writing between Biorex and Glycyx from time to time.
Exchange Control
----------------
9.4 Notwithstanding 9.1, 9.2 and 9.3 above, if at any time legal
restrictions prevent the prompt remittance of part or all payments
with respect to any country of the Territory where the Product is
sold, payment shall be node through such lawful means or methods as
Biorex may designate.
Late Payments
-------------
9.5 Any payments that are not paid on or before the date such payments are
due under this Agreement shall bear interest to the extent permitted
by applicable law at the time by the prime rate laid down from time to
time by the Bank of England plus one percent, calculated on the number
of days such payment is delinquent. This Section 9.5 shall in no way
limit any other remedy available to either party.
10. INFRINGEMENT
------------
Infringement Rights
-------------------
10.1 The provisions of this Article 10 shall govern the parties' rights and
obligations, as between themselves, with respect to actions Against
and by Third Parties for infringement of patents licensed under this
Agreement or owned by such Third Parties, In the event that either
party learns of a significant infringement of the Patent Rights within
the Territory, it shall promptly notify the other party.
10.2 Enforcement of Patent Rights
----------------------------
10.2.1 Glycyx and its Sublicensees shall have the exclusive right to bring,
direct and control any action to enforce the Patent Rights against
infringers within the Territory.
10.2.2 Glycyx nay deduct from Biorex Fees owing under Section 7.1 above for a
particular region all of its costs and expenses incurred in any
quarterly
20
period in enforcing the Patent Rights in such region, up to [*]
amounts owing to Biorex for that region in that period. Any remaining
undeducted costs and expenses may be carried forward and deducted
under the same conditions, for up to four (4) subsequent quarters
after the quarter in which they were incurred, from the Biorex Fees
owed under Section 7.1 with respect to such region in such subsequent
quarters. Thereafter, such costs and expenses shall be deducted from
Profits from such region prior to calculating the amounts owed to
Biorex under 7.2 above.
10.2.3 After reimbursement to Glycyx for its unreimbursed expenses, all
damages and other payments recovered by Glycyx from such infringing
parties shall be included in Profits, Biorex shall cooperate with
Glycyx, at Glycyx's expense, in connection with any such litigation,
including without limitation by joining as a party if necessary or
appropriate and executing such documents as Glycyx may reasonably
request.
Third Party Claims
------------------
10.3 In the event that Glycyx is sued by a Third Party alleging that the
manufacture, sale or use of a Product infringes patent rights of such
Third Party, then Glycyx may withhold up to [*] payable in any quarter
with respect to the region involved in such suit and apply such
amounts to any damages, costs, liabilities or expenses (including the
reasonable fees of attorneys and other professionals) incurred as a
result of such claim, up to [*] of such damages, costs, liabilities
and expenses. All unreimbursed damages, costs liabilities and expenses
shall thereafter be deducted from Profit earned in such region for
purposes of determining Biorex Profit.
11. CONFIDENTIALITY
---------------
General
-------
11.1 Except as expressly otherwise provided in this Agreement, each party
shall hold in confidence and not use or disclose to any Third Party
(other than employees, consultants, advisors, permitted Sublicensees
and Third Parties with whom such party is considering entering into a
business relationship who are similarly bound in writing) any product,
technical, manufacturing, process, marketing, financial, business or
other information, ideas, or know-how of the other party that is
identified in writing by the other party as confidential ("Proprietary
Information") at the
21
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
time of its disclosure or within thirty (30) days thereafter;
provided, however, that Proprietary Information of a party shall not
include:
11.1.1 Items which at the time of disclosure are published or otherwise
generally available to the public;
11.1.2 Items which, after disclosure to the other party, are published or
become generally available to the public through no breach of this
Agreement by the other party or the other party's employees or agents;
or
11.1.3 Items which the other can document were or are (i) in its possession
at the time of disclosure and was not acquired directly or indirectly
from such party, (ii) independently developed.
Exceptions
----------
11.2 A party may disclose Proprietary Information of the other:
11.2.1 In connection with the order of a court of law or in compliance with
laws or regulations relating to registrations or sale of securities or
product approval, or
11.2.2 If such information is also rightfully acquired from a Third Party
who, to the best of such party's knowledge and belief, is entitled to
rightfully make such disclosure, but only to the extent such party
complies with any restrictions imposed by the Third Party
11.2.3 After five (5) years from the date such information is disclosed to it
hereunder.
Licensed Information
--------------------
11.3 Any Proprietary Information of or used by Biorex which is or may be
subject to an exclusive licence to Glycyx hereunder, shall not be
disclosed by Biorex to any Third Party for use in the Territory except
for purposes not inconsistent with such exclusive license and only
pursuant to confidentiality and non-use restrictions at least as
restrictive as those provided herein.
Terms of this Agreement
-----------------------
11.4 Glycyx and Biorex agree not to disclose the financial terms or
conditions of this Agreement to any Third Party without the prior
written consent of the other party hereto (which consent shall not be
unreasonably withheld), except as required by applicable law, or to
professional advisers, or to persons with whom Biorex or Glycyx has
entered into
22
or proposes to enter into a business relationship for the purposes of
raising capital to run their business, and then only under conditions
of confidence.
12. PATENT PROSECUTION AND MAINTENANCE
----------------------------------
Control
-------
12.1 Glycyx shall have the right to take such actions as are necessary or
appropriate, with counsel of its choosing, to effect the patent
applications within the Patent Rights and to obtain patent protection
with respect to the subject matter therein in any country within the
Territory. In the event that Glycyx or a Sublicensee elects not to
prosecute or maintain a patent application or patent within the Patent
Rights, Biorex shall have the right to do so at its own expense.
Expenses
--------
12.2 The cost of Glycyx's preparing, filing, prosecuting and maintaining
all patent applications and patents contemplated by this Agreement
shall be borne by Glycyx.
Co-operation
------------
12.3 Glycyx shall provide Biorex with copies of all material documentation
after Glycyx's receipt from or prior to submission to any governmental
agency with jurisdiction to issue such patents, as appropriate, so
that Biorex may be informed and appraised of the continuing
prosecution. Glycyx shall consult with Biorex and its counsel
concerning prosecution of any patent application and adopt reasonable
suggestions made with respect thereto, and shall use its best efforts
to amend any patent application to include claims reasonably requested
by Biorex and required to protect the product contemplated to be sold
under this Agreement. Biorex shall make available to Glycyx or its
authorised attorneys, agents or representatives, Biorex's employees,
agents or consultants necessary or appropriate to enable Glycyx to
file, prosecute and maintain patent applications and resulting patents
within the Patent Rights. Biorex shall sign or cause to have signed
all documents relating to said patent applications or patents at no
charge to Glycyx.
13. TERM AND TERMINATION
--------------------
Expiration
----------
13.1 Unless terminated earlier pursuant to Section 13.2, 13.3 or 13.4
below, this Agreement shall expire
23
fifteen (15 years) from the date of Launch. Upon expiration of this
Agreement, Glycyx shall have the following irrevocable, licences (with
right to sublicense): (a) a non-exclusive royalty-free licence under
the Technical Information and Manufacturing Technology to make, have
made, use, sell and have sold Products in the Territory; and (b) the
exclusive right and license to use the Trade Xxxx in accordance with
the terms of Sections 6.3.2, 6.3.3 and 6.3.4 in connection with the
marketing and sale of such Products in the Territory, subject to the
provisions of Section 6.3.5.
Termination for Cause
---------------------
13.2 Either party may terminate this Agreement following the material
breach of any material provision of this Agreement by the other party
if the breaching party has not commenced to cure such breach within
ninety (90) days after written notice thereof by the other party and
thereafter proceeded diligently to cure such breach within a
reasonable time; provided, that in no event shall such reasonable time
--------
to cure such breach exceed one hundred eighty (180) days from the date
of such notice. In determining whether there has been a material
breach of a material provision of this Agreement for purposes of this
Section 13.2, all of the circumstances of the breach shall be
considered, including the breaching party's conduct, the hardship of
termination, the extent to which the breaching party has performed its
obligations, the extent to which the non-breaching party will obtain
the benefits it reasonably anticipated, and similar factors.
Termination by Glycyx
---------------------
13.3 Glycyx shall have the right to terminate this Agreement and the
licences granted herein, in whole or as to any specified Product or
country, at any time, and from time to time, by giving notice in
writing to Biorex. Such termination shall be effective ninety (90)
days from the date Biorex receives such notice and all Glycyx's rights
associated therewith shall cease as of that date; provided, however,
that if Glycyx revokes in writing its notice of termination before the
end of such 90 day period, such notice of termination shall have no
effect and the rights specified in such notice of termination shall
not terminate.
Termination by Biorex
---------------------
13.4 Without prejudice to any other rights Biorex may have to terminate
under this Agreement, in the event that:-
24
13.4.1 Salix ceases business or seeks protection from its creditors pursuant
to Chapter 11 of the U.S. Bankruptcy Code or files or has filed
against it a voluntary or involuntary bankruptcy procedure that is not
dismissed within sixty (60) days or a receiver or assignee is
appointed for the benefit of its creditors or if it takes or suffers
any similar action in consequence of debt with respect to all or
substantially all of its assets; THEN Biorex shall have the right to
terminate this Agreement forthwith.
13.4.2 (a) a Sublicensee terminates its Sublicense with Glycyx and
(b) Biorex and the Sublicensee have either:
(i) prior to the date of the relevant Sublicense agreement; or
(ii) on the same day as the date of the relevant Sublicense
agreement; or
(iii) after the date of the relevant Sublicense agreement and with
the consent of Glycyx, such consent not to be delayed or
unreasonably withheld
entered into an agreement under which Biorex agrees, in the event
of termination of the Sublicense, to grant a licence directly to
the Sublicensee;
THEN Glycyx's rights and licenses under this Agreement shall terminate
forthwith automatically in respect of the region covered by the
relevant Sublicense.
13.4.3 (a) by reason of any act or omission on the part of Glycyx, a
Sublicensee is entitled to a royalty-free licence to manufacture
Products; and
(b) the Sublicensee exercises such right, and such licence continues
for more than 180 days
THEN Biorex shall have the right to terminate Glycyx's rights and
licenses under this Agreement forthwith in respect of the region
covered by the relevant Sublicense.
13.5 Effect of Termination
---------------------
13.5.1 Upon a termination of this Agreement by Glycyx under Section 13.3
above, or by Biorex under Section 13.4 above, or by reason of a
material breach by Glycyx, all licenses granted to Glycyx hereunder
(or in the event of a partial termination the licenses to the Products
and countries to which such termination pertains) shall terminate. In
the event of such a termination, Glycyx shall (to the
25
extent that any applicable Sublicense agreement allows) assign to
Biorex filings made in Glycyx's or its Sublicensees name with the
health regulatory authorities within the terminated country that
pertain to the Products.
13.5.2 Expiration or termination of this Agreement shall not relieve the
parties of any obligation accruing prior to such expiration or
termination.
13.5.3 Upon termination of this Agreement by either party Glycyx shall
provide Biorex with a written inventory of all Products in process of
manufacture or in stock, and Glycyx (and its Affiliates and
Sublicensees) shall have the privilege of disposing of such Products
within a period of one hundred eighty (180) days; provided, however,
that Glycyx shall pay Biorex Profit on any sales of such Products at
the rate and at the time herein provided and shall render Reports
thereon.
13.5.4 In event of any termination of this Agreement or any licenses granted
hereunder, whether in whole or in part, any Sublicense, marketing or
other distribution rights granted by Glycyx hereunder shall survive,
and the relevant Sublicense and/or distribution agreements, if any,
shall be deemed assigned to Biorex, except where Biorex and the
relevant Sublicensee enter into an agreement to provide an alternative
arrangement in the event of such termination.
13.5.5 Upon the expiration or termination of this Agreement for any reason,
the parties' rights and obligations under the following provisions
shall survive: Article 1, Sections 6.3, 8.2, 8.3 and Articles 9, 11,
13, 14 and 17; provided that the indemnification provision of Article
14 shall survive only with respect to claims that are made prior to
three (3) years after expiration or termination of this Agreement. In
addition, upon expiration of this Agreement under Section 13.1 above,
the parties rights and obligations under Article 4 and Section 6.2
shall survive.
14. INDEMNITY
---------
Glycyx
------
14.1 Subject to Biorex's compliance with its obligations set forth in
Section 14.3 below, Glycyx agrees to indemnify and hold Biorex, its
Affiliates and their employees and agents harmless from and against
any losses, claims, damages, liabilities or actions (including
reasonable attorneys' fees and court and other expenses of litigation)
(collectively, the "Liabilities") suffered or incurred in connection
with Third Party claims for personal injuries or
26
any product recall to the extent caused by: (a) any failure to test
for or provide adequate warnings of adverse side effects to the extent
such failure arises out of acts or omissions in connection with the
performance of Glycyx's preclinical or clinical testing obligations
hereunder, (b) any manufacturing defect in any Product or other
material manufactured by Glycyx or its subcontractors, or (c) any
other act or omission (without regard to culpable conduct) of Glycyx
or its subcontractors in connection with the activities contemplated
under this Agreement, except to the extent such Liabilities resulted
from negligence, recklessness or intentional misconduct of Biorex.
Biorex
------
14.2 Subject to Glycyx's compliance with its obligations set forth in
Section 14.3, Biorex agrees to indemnify and hold Glycyx, its
Affiliates, and Sublicensees and their employees and agents harmless
from and against any Liabilities suffered or incurred in connection
with third party claims for personal injuries or any product recall to
the extent caused by: (a) any failure to test for or provide adequate
warnings of adverse side effects to the extent such failure arises out
of acts or omissions in connection with Biorex's preclinical or
clinical testing obligations hereunder, (b) any manufacturing defect
in any Product or other material manufactured by Biorex or its
subcontractors, or (c) any other act or omission (without regard to
culpable conduct) of Biorex or its subcontractors in connection with
the activities contemplated under this Agreement, except to the extent
such Liabilities resulted from negligence, recklessness or intentional
misconduct of Glycyx or its Affiliates, sublicensees or
subcontractors. Notwithstanding the foregoing, Biorex shall not be
obligated to indemnify Glycyx or its Affiliates, Sublicensees or
subcontractors with respect to Liabilities incurred in the course of
human clinical trials conducted by Glycyx (itself or through
subcontractors), or with respect to Liabilities resulting from the use
of Products supplied by Biorex as clinical trials materials for use in
such clinical trials.
Procedure
---------
14.3 A party (the "Indemnitee") that intends to claim indemnification under
this Article 14 shall promptly notify the other party (the
"Indemnitor") in writing of any loss, claim, damage, liability or
action in respect of which the Indemnitee or any of its Affiliates,
employees or agents intend to claim such indemnification, and the
Indemnitor shall have
27
the right to participate in, and, to the extent the Indemnitor so
desires, jointly with any other Indemnitor similarly noticed, to
assume the defence thereof with counsel mutually satisfactory to the
parties; provided, however, that an Indemnitee shall have the right to
--------
retain its own counsel, with the fees and expenses to be paid by the
Indemnitee, if representation of such Indemnitee by the counsel
retained by the Indemnitor would be inappropriate due to actual or
potential differing interests between such Indemnitee and any other
party represented by such counsel in such proceeding. The indemnity
agreement in this Article 14 shall not apply to amounts paid in
settlement of any loss, claim, damage, liability or action if such
settlement is effected without the consent of the Indemnitor, which
consent shall not be withheld unreasonably. The failure to deliver
written notice to the Indemnitor within a reasonable time after the
commencement of any such action, if prejudicial to its ability to
defend such action, shall relieve such Indemnitor of any liability to
the Indemnitee under this Article 14, but the omission so to deliver
written notice to the Indemnitor shall not relieve it of any liability
that it may have to any Indemnitee otherwise than under this Article
14. The Indemnitee under this Article 14, its employees and agents,
shall cooperate fully with the Indemnitor and its legal
representatives in the investigation of any action, claim or liability
covered by this indemnification.
15. FORCE MAJEURE
-------------
Neither party shall be held liable or responsible to the other party nor be
deemed to have defaulted under or breached this Agreement for failure or delay
in fulfilling or performing any term of this Agreement when such failure or
delay is caused by or results from causes beyond the reasonable control of the
affected party or from fire, floods, embargoes, war, acts of war (whether war be
declared or not), insurrections, riots, civil commotions, strikes, lockouts or
other labour disturbances, acts of God or acts, omissions or delays in acting by
any governmental authority or the other party.
16. ASSIGNMENT
----------
This Agreement may not be assigned or otherwise transferred, nor, except as
expressly provided hereunder, may any right or obligations hereunder to assigned
or transferred, by either party without the written consent of the other party;
provided, however that either Biorex or Glycyx may, without such consent, assign
--------
this Agreement and its rights and obligations hereunder in connection with the
transfer or sale of all or substantially all of its business, if such assets
include substantially all of the assets relating to
28
its performance of its respective obligations hereunder, or in the event of its
merger or consolidation with another company at any time during the term of this
Agreement. Any purported assignment in violation of the preceding sentence shall
be void. Any permitted assignee shall assume all obligations of its assignor
under this Agreement. No assignment shall relieve either party of responsibility
for the performance of any accrued obligation which such party then has
hereunder.
17. MISCELLANEOUS
-------------
Notices
-------
17.1 Any notice or report required or permitted to be given or made under
this Agreement by one of the parties hereto to the other shall be in
writing, delivered personally or by facsimile (and promptly confirmed
by personal delivery or courier) or courier, postage prepaid,
addressed to such other party at its address indicated below, or to
such other address a the addressee shall have last furnished in
writing to the addressor and shall be effective upon receipt by the
addressee.
Glycyx Pharmaceuticals Ltd
Cedar House
41 Cedar Avenue
Xxxxxxxx, Xx-12, Bermuda
Attention: Managing Director
Biorex Laboratories, Ltd
0 Xxxxxxxxxx Xxxxxxxx
Xxxxxxxx Xxx
Xxxxxxx, Xxxxxxxxx XX0 0XX
Attention: Managing Director
Applicable Law
--------------
17.2 This Agreement shall be governed by and construed in accordance with
the laws of England, without regard to conflicts of laws provisions.
Export Laws
-----------
17.3 Biorex shall procure and maintain all U.K. export licenses required
for it to transfer to Glycyx and its Sublicensees all Technical
Information, Patent Rights, Manufacturing Technology and other
technical data, and shall comply with all other U.K. laws, regulations
and governmental directives relating to the export of technical data,
goods and services.
No Consequential Damages
------------------------
17.4 EXCEPT AS PROVIDED IN SECTION 14 IN NO EVENT SHALL EITHER GLYCX OR
BIOREX OR THEIR AFFILIATES BE
29
LIABLE FOR SPECIAL, INDIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES
(INCLUDING WITHOUT LIMITATION DAMAGES FOR LOSS OF PROFITS, PRODUCTION,
USE OR SALES) BASED ON CONTRACT, TORT OR ANY OTHER LEGAL THEORY.
Entire Agreement
----------------
17.5 This Agreement contains the entire understanding of the parties with
respect to the subject matter hereof. All express or implied
agreements and understandings, either oral or written heretofore made
(including without limitation the Original Agreement which is
superseded in its entirety by this Agreement) are expressly excluded.
This Agreement may be amended, or any term hereof modified, only by a
written instrument duly executed by both parties hereto.
Headings
--------
17.6 The captions to the several Articles and Sections hereof are not a
part of this Agreement, but are merely guides or labels to assist in
locating and reading the several Articles and sections hereof.
Independent Contractors
-----------------------
17.7 It is expressly agreed that Glycyx and Biorex B shall be independent
contractors and that the relationship between the two parties shall
not constitute a partnership, joint venture or agency. Neither Glycyx
nor Biorex shall have the authority to make any statements,
representations or commitments of any hand, or to take any action,
which shall be binding on the other, without the prior written
authorisation of the other party to do so.
Waiver
------
17.8 The waiver by either party of any right hereunder or the failure to
perform or of a breach by the other party shall not be deemed a waiver
of any other right hereunder or of any other breach or failure by said
other party whether of a similar nature or otherwise.
Further Assurances
------------------
17.9 Glycyx shall use commercially reasonable efforts to ensure that each
of its Sublicensees and subcontractors shall observe and perform all
the obligations and restrictions applicable to it under this
Agreement.
30
Severability
------------
17.10 In case any one or more of the provisions contained in this Agreement
shall for any reason be held to be invalid, illegal or unenforceable
in any respect, such invalidity, illegality or unenforceability shall
not affect any other provisions hereof, but this Agreement shall be
construed as if such invalid or illegal or unenforceable provisions
had never been contained herein.
IN WITNESS WHEREOF the parties have executed this Agreement as of the day and
year first above written.
GLYCYX PHARMACEUTICALS LTD BIOREX LABORATORIES LTD
/s/ Xxxxx Xxxxxxxx /s/ Xxxx Xxxxxxxxx
---------------------------- -------------------------
SIGNED SIGNED
President Managing Director
---------------------------- -------------------------
TITLE TITLE
31
EXHIBIT A
---------
Patents and Patent Applications
Patent Number Filing Date Grant Date Due to Expire
------ ------ ----------- ---------- -------------
UK 2,080,796 Complete 7 July 2001
Specification
7 July 0000
Xxxxxx 1,493,313 21 July 1981 21 July 0000
Xxxxx 1,138,450 10 July 1981 17 December 1986 10 July 2001
F.R.G. 3,120,019 21 July 1981 15 February 1990 21 July 2001
32
EXHIBIT B
---------
Regional Minimums
Year After Commercial Introduction of
First Product in Corresponding Region
-------------------------------------
First Year Second Year Third, Fourth, and
Fifth Years
((POUNDS)000) ((POUNDS)000) ((POUNDS)000)
------------- ------------- -------------
Region
------
[*]
33
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
EXHIBIT C
---------
Trade Xxxx "COLAZIDE"
REGISTRATIONS
-------------
Country Number
------- ------
Australia A455069
Benelux 428853
Denmark 00000-0000
Xxxxxxx 000000
Xxxxxx XX 1157517
Great Britain 1234695
Greece 93779
Iceland 837/1989
Ireland 000000
Xxxxx 512161
New Zealand 168967
Xxxxxx 000000
Xxxxx Xxxxxx 000000
Xxxxxx 221326
Switzerland 371887
Applications
------------
Country Number
------- ------
Austria 000000
Xxxxxx 000000
Xxxxxx 1396079
34
[LETTER HEAD OF BIOREX]
Glycyx Pharmaceuticals Ltd
Xxxxx Xxxxx
00 Xxxxx Xxxxxx
Xxxxxxxx XX00
Xxxxxxx
LETTER OF AGREEMENT
-------------------
Background
----------
A. By an agreement dated 18th March 1992 between Glycyx Pharmaceuticals, Ltd.
("Glycyx") and Biorex Laboratories Limited ("Biorex"), Biorex granted to
Glycyx an exclusive licence to make, have made, use, sell and have sold
Products in the Territory (the terms "Products" and Territory" being
defined in the agreement).
B. An agreement dated 17th September 1992 (the "Agreement") between Biorex and
Glycyx replaced the agreement dated 18th March 1992 in its entirety.
C. Section 4.1.1 of the Agreement provides as follows:-
"4.1.1 Biorex shall assist in the completion of the clinical
development and in the obtaining of the necessary regulatory
approvals in Biorex's name to market a Product containing
Balsalazide for the treatment of ulcerative colitis in the
United Kingdom;..."
D. Notwithstanding the provisions of section 4.1 1 of the Agreement referred
to in C. above,, Biorex prepared to permit Glycyx to obtain in its own name
the necessary regulatory approvals to market a Product containing
Balsalazide for the treatment of ulcerative colitis in the United Kingdom
on and subject to the provisions of this Letter of Agreement. The terms
"Product" and "Balsalazide" having the meanings given to them in the
Agreement.
It is agreed that:-
1. Biorex shall waive its right under section 4.1.1 of the Agreement to have
the necessary regulatory approvals to market a Product containing
Balsalazide for the treatment of ulcerative colitis in the United Kingdom
in its (own name, and agrees that Glycyx shall be entitled to obtain such
approval in Glycyx's name on and subject to the provisions of this Letter
of Agreement.
2. If, and only if:-
i) the Agreement is terminated by Biorex pursuant to section 13.2 and/or
section 13.4 of the Agreement; and/or
ii) during such time as:-
(a) Glycyx is required to make payments to Biorex under the
Agreement; or
(b) Glycyx would be required to make payments to Biorex under the
Agreement were Glycyx and/or its, Sublicensees to make, have
made, use, sell and/or have sold Products within the Territory.
Salix Holdings, Ltd. and/or Glycyx shall cease business or seek protection
from their creditors pursuant to Chapter 11 of the US Bankruptcy Code or
file or have filed against them voluntary or involuntary bankruptcy
procedure that is not dismissed within 60 days or if a receiver or assignee
is appointed for the benefit of their creditors or if they take or suffer
any similar action in consequence of debt with respect to all or
substantially all of their assets;
then Biorex, upon 30 days notice to Glycyx, shall be entitled to fill ill
in the Product Licence Number to date and send the letter attached to this
Letter of Agreement (the "Letter of Authority") to the Medicines Control
Agency (or its successor)
3. If Biorex shall be entitled to send the Letter of Authority pursuant to
paragraph 2 above, then at the cost of Biorex, Glycyx shall promptly do all
things necessary and provide Biorex with all reasonable assistance to
enable Biorex or its nominee to obtain regulatory approvals in the United
Kingdom equivalent to those obtained by Glycyx pursuant to paragraph 1 of
this Letter of Agreement.
4. Glycyx shall not do anything to reduce or limit the effectiveness of the
Letter of Authority and in particular shall not purport to withdraw or
cancel the Letter of Authority.
5. Except as specifically stated in paragraph 1 of this Letter of Agreement,
all the provisions of the Agreement shall continue in full force and
effect.
6. The provisions of this Letter of Agreement shall take effect on the date
set out at the start of this Letter of Agreement.
7. This Letter of Agreement shall be governed by and construed in accordance
with the laws of England.
Agreed for and on behalf of Agreed for and on behalf of
Glycyx Pharmaceuticals, Ltd Biorex Laboratories Limited
by its duly authorised by its duly authorised
representative representative
/s/ Xxxxx Xxxxxxxx /s/ Xxxx Xxxxxxxxx
.......................... ............................
Signed Signed
President Managing Director
.......................... ............................
Title Title
[LETTER HEAD OF GLYCYX PHARMACEUTICALS, LTD]
Dated:
The Medicines Control Agency
Dear Sir:
PRODUCT LICENCE NUMBER
----------------------
We, the proprietors of the above product licence, hereby authorise the Medicines
Control Agency (or its successor) to refer to the information and data supplied
to the Medicines Control Agency in respect of our product licence when assessing
product licence applications made by Biorex Laboratories Limited or its nominee.
We hereby request and authorise the Medicines Control Agency (or its successor)
to cancel our product licence once Biorex Laboratories Limited or its nominee
has been granted a product licence equivalent to our product licence.
We confirm that once our product licence has been cancelled we shall no longer
supply products covered by it or any products under the name "Colazide".
Yours faithfully,
/s/ Xxxxx Xxxxxxxx
---------------------------------------
President, Glycyx Pharmaceuticals, Ltd.
[LETTER HEAD OF GLYCYX PHARMACEUTICALS, LTD]
From: Glycyx Pharmaceuticals Ltd.
To: Biorex Laboratories Limited
Dear Sirs:
RE: License Agreement dated 17th September 1992 between Biorex Laboratories
-----------------------------------------------------------------------
Limited ("Biorex") and Glycyx Pharmaceuticals, Ltd. ("Glycyx")
--------------------------------------------------------------
I write for and on behalf of Glycyx in connection with the above license
agreement ("the License") and in particular, in connection with Section 13 of
the Agreement concerning term and termination.
Glycyx and Biorex agree as follows:-
(i) That the first word of section 13.4.1, "Salix" shall be deleted and
replaced by word "Glycyx; and
(ii) That Section 13.4 of the License shall be amended by the addition of the
new section 13.4.4 to read as follows:-
"13.4.4(a) by reason of any act or omission of Glycyx (including
without limitation any breach of the provisions of any Sublicense)
any Sublicensee appointed in respect of the territory of Italy,
Spain, Greece and/or Portugal is entitled (or otherwise obtains any
right) to manufacture or have manufactured on its behalf by a third
party Products and/or sell in such part or parts of the Territory
such Products manufactured by it or an its behalf upon terms whereby
Biorex is to receive a royalty of [*] of each Product manufactured
and/or sold by such Sublicensee; and
(b) The Sublicensee or a third party for and on behalf of the
Sublicensee commences manufacture of Products;
THEN Biorex shall have the right to terminate Glycyx's rights and
licenses under this Agreement forthwith in respect of such part or
parts of the Territory.
For the avoidance of doubt for the purposes of this Section 13.4.4
"manufacture" shall mean the manufacture of Bulk Balsalazide or the
Bulk Active Ingredient for Balsalazide (4ABA) by such Sublicensee or
an behalf of any such Sublicensee by a third party."
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS
BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
Please confirm your agreement to the amendment to the License as set out in this
letter by signing and returning the enclosed copy letter.
Yours faithfully,
/s/ Xxxxx Xxxxxxxx
Xxxxx Xxxxxxxx, President
Signed for an on behalf of
Glycyx Pharmaceuticals Ltd.
Biorex Laboratories Limited hereby confirms its agreement to the amendment to
the License set out above.
Xxxx Xxxxxxxxx
Signed for an on behalf of
Biorex Laboratories Limited.
