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EXHIBIT 10.11
OPTION AGREEMENT
This OPTION AGREEMENT (together with the exhibits hereto the
"Agreement") is entered into the 1st day of March, 1997 (the "Effective Date")
by and between CORIXA CORPORATION, a Delaware corporation with its principal
place of business located at 0000 Xxxxxxxx Xxxxxx, Xxxxx 000, Xxxxxxx,
Xxxxxxxxxx 00000 ("Corixa") and SmithKline Xxxxxxx Biologicals Manufacturing
S.A., a Belgian corporation with its principal place of business at Xxx xx
x'Xxxxxxxx 00, X-0000 Xxxxxxxxx, Xxxxxxx ("SB").
W I T N E S S E T H:
WHEREAS, Corixa and SB are parties to a Prostate Cancer Collaboration
and License Agreement (the "Prostate Cancer Agreement") and a Breast Cancer
Collaboration and License Agreement (the "Breast Cancer Agreement") both of even
date herewith (each, the "Collaboration Agreement") whereby the parties have
agreed to collaborate in the research, development and license of antigens for
vaccine products for the prevention and/or treatment of prostate and breast
cancers, respectively;
WHEREAS, SB desires to acquire from Corixa an option to enter into
additional agreements for antigens for vaccine products for the prevention
and/or treatment of [***] and/or [***] cancers that take the form of the
Collaboration Agreements with appropriate revisions to reflect a modification of
the subject matter to cover [***] and/or [***] cancers.
NOW, THEREFORE, for and in consideration of the mutual observance of the
covenants hereinafter set forth and other good and valuable consideration, the
receipt of which is hereby acknowledged, the parties hereto agree as follows:
1. DEFINITIONS
"[***] Collaboration Agreement" shall have the meaning assigned
thereto in Section 2(a).
"[***] Field" shall mean any and all in vivo administered
prophylactic and/or therapeutic [***] cancer Vaccines (as defined in the
Collaboration Agreements) for use in humans.
"[***] Option" means the option granted by Corixa to SB pursuant
to Section 2 hereof.
"[***] Option Period" means the period commencing on the
Effective Date and continuing until [***] following the Effective Date, as such
[***] Option Period may be extended pursuant to Section 2(c) hereof.
"National Exchange" shall mean the Nasdaq National Market or any
other national exchange on which the Common Stock of Corixa is listed.
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"[***] Collaboration Agreement" shall have the meaning
assigned thereto in Section 3(a).
"[***] Field" shall mean any and all in vivo administered
prophylactic and/or therapeutic [***] cancer Vaccines as defined in the
Collaboration Agreement for use in humans.
"[***] Option" means the option granted by Corixa to SB
pursuant to Section 3 hereof.
"[***] Option Period" means the period commencing on the
Effective Date and continuing until [***] following the Effective Date, as such
[***] Option Period may be extended pursuant to Section 3(c) hereof.
2. GRANT OF OPTION FOR [***] FIELD
(a) Grant of Option
Subject to the provisions of this Agreement, Corixa hereby
grants to SB an option, exercisable during the [***] Option Period, to enter
into a collaboration and license agreement to cover the [***] Field (the "[***]
Option"), on substantially the same terms and conditions set forth in the
Collaboration Agreement; provided, that the parties acknowledge and agree that
the amounts allocated to research funding and other modifications that reflect
the nature of the disease target may be required (the "[***] Collaboration
Agreement"). SB may exercise the [***] Option at any time on or before the
expiration of the [***] Option Period (i) by providing written notice of
exercise to Corixa prior to the expiration of the [***] Option Period, and (ii)
paying to Corixa a lump sum payment of [***] by wire transfer of immediately
available funds, which payment shall be subject to credit or conversion as set
forth in Section 4 below; provided, however, that Corixa may begin discussing
possible collaborations with parties other than SB at any time after [***]
Option Period; such discussions shall be terminated forthwith by Corixa if and
when SB exercises the [***] Option or extends the [***] Option Period pursuant
to Section 2(c) hereof.
(b) Initial Option Fee
Upon execution and delivery of this Agreement, SB shall pay to
Corixa a lump sum payment of [***] by wire transfer of immediately available
funds, which payment shall be subject to credit, conversion or repayment as set
forth in Section 4 below.
(c) Extension of the Option Period
SB will have the right to extend the [***] Option Period for
[***] by (i) providing written notice to Corixa of
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SB's intention to extend the [***] Option Period prior to the expiration of the
initial [***] Option Period, and (ii) making the payment set forth in Section
2(d) below.
(d) Option Extension Fee
If SB elects to extend the [***] Option Period pursuant to
Section 2(c) above, on or before the expiration of the initial [***] Option
Period, SB shall pay to Corixa a lump sum payment of [***] by wire transfer of
immediately available funds, which payment shall be subject to credit,
conversion or repayment as set forth in Section 4 below.
3. GRANT OF OPTION FOR [***] FIELD
(a) Grant of Option
Subject to the provisions of this Agreement, Corixa hereby
grants to SB an option, exercisable during the [***] Option Period, to enter
into a collaboration and license agreement to cover the [***] Field (the "[***]
Option"), on substantially the same terms and conditions set forth in the
Collaboration Agreement, provided, that the parties acknowledge and agree that
the amounts allocated to research funding and other modifications that reflect
the nature of the disease target may be required (the "[***] Collaboration
Agreement"). SB may exercise the [***] Option at any time on or before the
expiration of the [***] Option Period (i) by providing written notice of
exercise to Corixa prior to the expiration of the [***] Option Period and (b)
paying to Corixa a lump sum payment of [***] by wire transfer of immediately
available funds, which payment shall be subject to credit or conversion as set
forth in Section 4 below; provided, however, that Corixa may begin discussing
possible collaborations with parties other than SB at any time after [***]
Option Period. Said discussions shall be terminated forthwith by Corixa if and
when SB exercises the [***] Option or extends the [***] Option Period pursuant
to Section 3(c) hereof.
(b) Initial Option Fee
Upon execution and delivery of this Agreement, SB shall pay to
Corixa a lump sum payment of [***] by wire transfer of immediately available
funds, which payment shall be subject to credit, conversion or repayment as set
forth in Section 4 below.
(c) Extension of the Option Period
SB will have the right to extend the [***] Option Period for
[***] by (i) providing written notice to Corixa of SB's intention to extend the
initial [***] Option Period prior to the expiration of the initial [***] Option
Period, and (ii) making the payment set forth in Section 3(d) below.
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(d) Option Extension Fee
If SB elects to extend the [***] Option Period pursuant to
Section 3(c) above, on or before the expiration of the initial [***] Option
Period, SB shall pay to Corixa a lump sum payment of [***] by wire transfer of
immediately available funds, which payment shall be subject to credit,
conversion or repayment as set forth in Section 4 below.
4. OPTION PAYMENTS. All payments made by SB to Corixa pursuant to
Sections 2 and 3 above shall be subject to the following terms and conditions:
(a) [***] Option Payments. If SB exercises the [***] Option,
then all payments made by SB to Corixa pursuant to Section 2 shall be, at the
election of SB, either (i) credited against future milestones in the [***]
Collaboration Agreement in accordance with Section 4(c) below or (ii) if
Corixa's Common Stock is listed on a National Exchange and Corixa has a market
capitalization of not less than [***] (assuming exercise or conversion of all
outstanding options, warrants and other securities exercisable for or
convertible into Corixa's Common Stock), converted into Corixa's Common Stock in
accordance with Section 4(d) below. If SB does not exercise the [***] Option,
then all payments made by SB to Corixa pursuant to Section 2 shall be repaid by
Corixa in accordance with Section 4(e) below.
(b) [***] Option Payments. If SB exercises the [***] Option,
then all payments made by SB to Corixa pursuant to Section 3 shall be, at the
election of SB, either (i) credited against future milestones in the [***]
Collaboration Agreement in accordance with Section 4(c) below or (ii) if
Corixa's Common Stock is listed on a National Exchange and Corixa has a market
capitalization of not less than [***] (assuming exercise or conversion of all
outstanding options, warrants and other securities exercisable for or
convertible into Corixa's Common Stock), converted into shares of Corixa's
Common Stock in accordance with Section 4(d) below. If SB does not exercise the
[***] Option, then all payments made by SB to Corixa pursuant to Section 3 shall
be repaid by Corixa in accordance with Section 4(e) below.
(c) Credit Against Milestones. From and after receipt of written
notice from SB to Corixa (the "Credit Notice") of SB's intent to credit payments
made by it pursuant to Section 2 and/or Section 3 of this Agreement, as
applicable (the "Credit Amount"), which Credit Notice shall be made within
fifteen (15) days of the exercise of the [***] Option and/or the [***] Option,
as applicable, Corixa shall repay the Credit Amount by applying such Credit
Amount against future milestones that become payable by SB to Corixa in
accordance with the terms of the [***] Collaboration Agreement and/or the [***]
Collaboration Agreement, as applicable, during the period beginning the date of
the Credit Notice(s) and ending on [***] of the Credit Notice(s). On [***] of
the Credit Notice, Corixa shall pay to SB the balance, if any, of the Credit
Amount not credited against such milestones pursuant to this Section 4(c).
However, the entire Credit Amount or any portion thereof may be prepaid by
Corixa at any time in its sole discretion.
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(d) Conversion to Common Stock. Within thirty (30) days (the
"Conversion Date") following the Corixa's receipt of a written notice from SB
(the "Conversion Notice Date") of SB's intent to convert payments made by it
pursuant to Section 2 and/or Section 3 of this Agreement as applicable into
shares of Corixa's Common Stock, (the "Conversion Amount"), Corixa shall issue
to SB the number of shares of Corixa's Common Stock equal to the Conversion
Amount divided by the "Common Stock Price." For purposes of this Section 4(d),
the "Common Stock Price" shall equal [***] of the average closing price for
Corixa's Common Stock during the period beginning six (6) trading days prior to
the Conversion Notice Date and ending on the trading day prior to the date of
the Conversion Notice Date, as reported on the National Exchange.
(e) Repayment. Within thirty (30) days following expiration of
the [***] Option Period, or the [***] Option Period, as the case may be (the
"Note Issuance Date"), to the extent SB has not exercised the [***] Option, or
the [***] Option, as applicable, Corixa shall issue to SB an interest-free
promissory note in principal amount equal to the payments made by SB pursuant to
Section 2 in the case of the [***] Option and Section 3 in the case of the
[***] Option, which will not bear interest, payable in three (3) equal annual
payments on the third, fourth and fifth anniversaries of the date of this
Agreement
5. MISCELLANEOUS
(a) Development Efforts. Upon exercise of the [***] Option
and/or [***] Option, the parties will collaborate in the discovery and
development of Antigens for use in Vaccine(s) for the prevention and/or
treatment of [***] cancer and/or [***] cancer, as applicable, by using
commercially reasonable efforts to conduct the activities set forth in a
research program plan to be prepared in good faith jointly by the parties as
soon as practicable after the exercise of the [***] Option and/or [***]
Option.
(b) Entire Agreement. This Agreement, entered into as of the
date written above, constitutes the entire agreement between the parties
relating to the subject matter hereof and supersedes all previous writings and
understandings, except that the Non Disclosure Agreements dated 17 February 1995
and 10 August 1995, the Tuberculosis Collaboration and License Agreement dated
October 6, 1995 between Corixa Corporation and SmithKline Xxxxxxx Biologicals
S.A., the Prostate Cancer Collaboration and License Agreement of even date
herewith and the Breast Cancer Collaboration and License Agreement of even date
herewith remain in full force and effect. No terms or provisions of this
Agreement shall be varied or modified by any prior or subsequent statement,
conduct or act of either of the parties, except that the parties may mutually
amend this Agreement by written instruments specifically referring to and
executed in the same manner as this Agreement.
(c) Notices. Any notice required or permitted under this
Agreement shall be deemed given if delivered (i) personally, (ii) by facsimile
transmission (receipt verified), (iii) by registered or certified mail (return
receipt requested), postage prepaid, or
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arbitration in accordance with the arbitration rules of the American Arbitration
Association ("AAA"), then in force, by one or more arbitrators appointed in
accordance with said rules; provided that the appointed arbitrators shall have
appropriate experience in the bio-pharmaceutical industry; provided further,
however, that arbitration proceedings may not be instituted until the party
alleging breach of this Agreement by the other party has given the other party
not less than sixty (60) days notice to remedy any alleged breach and the other
party has failed to do so. The place of arbitration shall be Seattle,
Washington, USA if arbitration is initiated by SB and New York, New York if
initiated by Corixa. The award rendered shall be final and binding upon both
parties. The judgment rendered by the arbitrator shall include costs of
arbitration, reasonable attorneys' fees and reasonable costs for any expert and
other witnesses. The arbitration in such proceeding may expressly consider the
amounts paid pursuant to Sections 2 and 3 hereof in considering any claim of
damages. Nothing in this Agreement shall be deemed as preventing either party
from seeking injunctive relief (or any other provisional remedy) from any court
having jurisdiction over the parties and the subject matter of the dispute as
necessary to protect either party's name, proprietary information, trade
secrets, know-how or any other proprietary rights. Judgment upon the award may
be entered in any court having jurisdiction, or application may be made to such
court for judicial acceptance of the award and/or an order of enforcement as the
case may be.
(f) Severability; Waiver If any provision of this Agreement is
finally held to be invalid, illegal or unenforceable by a court of competent
jurisdiction, the validity, legality and enforceability of the remaining
provisions shall not be affected or impaired in any way. Any delay in enforcing
a party's rights under this Agreement or any waiver as to a particular default
or other matter shall not constitute a waiver of a party's right to the future
enforcement of its rights under this Agreement.
(g) [Intentionally omitted.]
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IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement
to be executed by its duly authorized officer as of the date first written
above.
Agreed to and accepted by: Agreed to and accepted by:
CORIXA CORPORATION SMITHKLINE XXXXXXX BIOLOGICALS
MANUFACTURING S.A.
/s/ Xxxxxx Xxxxxx /s/ Jean Stephenne
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Xxxxxx Xxxxxx Jean Stephenne
President and CEO Senior Vice President and General Manager
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