Common use of Phase 1 Option Clause in Contracts

Phase 1 Option. On a Program-by-Program basis, during the applicable Phase 1 Option Term, Celgene shall have the right, but not the obligation, to exercise the Phase 1 Option for such Program in its sole discretion by delivering written notice of such exercise to Prothena prior to the end of the Phase 1 Option Term (the “Phase 1 Option Exercise Notice”). Within [***] ([***]) days following each Phase 1 Option Exercise Notice delivery, and subject to Section 3.2, Celgene [***] and Prothena shall enter into a Global License Agreement with respect to such Program (including completing the exhibits and schedules thereto). On a Program-by-Program basis, if Celgene fails to provide its Phase 1 Option Exercise Notice before the expiration of the applicable Phase 1 Option Term, then Celgene’s Phase 1 Option shall expire with respect to such Program. For the avoidance of doubt, subject to the rights and licenses granted to Celgene hereunder (and under any U.S. License Agreement and Global License Agreement), Prothena shall have the right to pursue, outside of this Agreement, Development and Commercialization of Antibodies or other compounds that Target the Collaboration Target in respect of which Celgene has not exercised its Phase 1 Option prior to the expiry of the applicable Phase 1 Option Term (but excluding, in all cases, the Development or Commercialization of any Antibodies that Target any remaining Collaboration Target); provided that if a U.S. License Agreement relating to such Collaboration Target is in force, all clinical Development and Commercialization activities must occur outside of the United States; and for clarity, the foregoing is not intended to be a grant to Prothena of any rights or licenses to any intellectual property of Celgene (or its Affiliates) or otherwise.