TECHNOLOGY LICENSE AGREEMENT*
CONFIDENTIAL
TREATMENT REQUESTED
Exhibit
10.6
This
license agreement (“Agreement”) is by and between:
MAYO
FOUNDATION FOR MEDICAL EDUCATION AND RESEARCH, a Minnesota charitable
corporation, located at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
(“MAYO”); and
NILE
PHARMACEUTICALS, INC., a Delaware corporation, incorporated by Two River Group
Holding, LLC, located at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
(“NILE”), each a “Party,” and collectively, “Parties.”
WHEREAS,
MAYO desires to make its patent rights and know-how available for the
development and commercialization of products for public use and benefit;
and
WHEREAS,
MAYO is willing to grant and NILE is willing to accept an exclusive license
under certain patent rights for the purpose of developing and commercializing
such products, as set forth below; and
WHEREAS,
NILE will be responsible for designing, developing, marketing, sublicensing
and
selling any products in accordance with the grant of rights
hereunder.
NOW
THEREFORE, in consideration of the foregoing and their mutual covenants set
forth below, the Parties agree as follows:
Article
1 - Definitions
For
purposes of this Agreement, each term defined in this Article will have the
meaning specified for it below and will be applicable both to the singular
and
plural forms:
1.01 “Affiliate”
means:
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(a)
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with
respect to MAYO means any corporation or other entity within the
same
“controlled group of corporations” as MAYO or its parent Mayo Foundation.
For purposes of this definition, the term “controlled group of
corporations” shall have the same definition as Section 1563 of the
Internal Revenue Code as of November 10, 1998, but shall include
corporations or other entities that, if not a stock corporation,
more than
50% of the board of directors or other governing body of such corporation
or other entity is controlled by a corporation within the controlled
group
of corporations of MAYO or Mayo Foundation. MAYO's Affiliates include,
but
are not limited to: Mayo Foundation; Mayo Collaborative Services;
Inc.,
Rochester Methodist Hospital; Saint Mary's Hospital; Mayo Clinic
Rochester; Mayo Clinic Jacksonville, Florida; St. Luke's Hospital,
Jacksonville, Florida; Mayo Clinic Arizona; Mayo Clinic Hospital,
Arizona;
Mayo Regional Practices, P.C., Decorah, Iowa; and Mayo Health System
West
Central Wisconsin and controlled or wholly-owned subsidiary corporations
of all of the above.
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* Confidential
treatment has been requested for certain portions of this Exhibit. The
confidential portions of this Exhibit have been omitted and filed separately
with the Securities and Exchange Commission. Such portions have been marked
with
“***” at the exact place where material has been omitted.
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(b)
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with
respect to NILE means any corporation or other person controlling,
controlled by or under common control with
NILE.
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(c)
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The
term “control” means the possession, directly or indirectly, of the power
to direct the management and policies of a corporation or person,
whether
through the ownership of voting securities, by contract or otherwise.
Control shall be deemed to exist in the case of the ownership, directly
or
indirectly, of 50% or more of the equity interests in any such
corporation.
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1.02
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“Change
of Control”
shall mean a merger, consolidation, acquisition or the transfer of
all, or
substantially all, of the business interests of NILE to which this
Agreement relates to which NILE is a party where the shareholders
of NILE
immediately prior to effective date of such merger or consolidation
beneficially own, immediately following the effective date of such
merger,
consolidation, acquisition or other transaction, securities representing
less than 50% of the combined voting power of the surviving corporation's
then outstanding voting securities.
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1.03
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“Commercialization”
means all steps that must be taken to put a Product on the market
in the
Territory after all necessary regulatory approvals have been obtained,
including, without limitation, the manufacturing, marketing, distribution
and/or sublicensing of such
Product.
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1.04
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“Development”
means the process of creating and assembling the data and files necessary
to obtain regulatory approval for a Product including, without limitation,
all preclinical and clinical research and trials on such
Product.
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1.05
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“Effective
Date”
means 20 January 2006.
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1.06
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“FDA”
means
the Food and Drug Administration within the Department of Health
and Human
Services of the United States.
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1.07
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“Field”
means all therapeutic indications.
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1.08
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“Government
Rights”
means rights, if any, of the United States Government to the Patents
under
Public Law 96-517 and Public Law 98-620, as amended or augmented
by other
similar laws.
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1.09
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“Improvements”
means any and all new developments relating solely to Products made
by or
arising out of the laboratories of Drs. ▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇▇▇▇
during the three (3) year period following the Effective Date of
this
Agreement, including improved methods of manufacture and production
techniques, and shall include, but not be limited to, new or additional
analogs of the Product, therapeutic indications and developments
intended
to enhance the safety and efficacy of the
Product.
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1.10 “Know-How”
means
all technical information and data, whether or not patented, presently known
or
learned, invented, or developed by the Drs. ▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇▇▇▇ that
is
useful in the Development and Commercialization of a Product and is disclosed
to
NILE, to the extent that such technical information and data are helpful for
the
use or practice of the Patents or Know-How as permitted herein.
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1.11
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“License
Quarter” begins
on the Effective Date, and thereafter begins on the first day of
each
January, April, July, and October during the
Term.
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1.12
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“License
Year”
begins on the Effective Date, and thereafter begins on the first
day of
each January during the Term.
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1.13
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“Net
Sales”
means the amount invoiced by NILE, its Affiliates or Sublicensee
for sale
of a Product in the Territory to a third party, less the
following:
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(a)
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sales,
tariff duties, excise or use taxes directly imposed and with reference
to
particular sales;
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(b)
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credits
for defective or returned Products;
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(c)
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regular
trade and discount allowances; and
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(d)
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bad
debt deductions actually written off during the accounting
period;
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Leasing,
lending, consigning or any other activity by means of which a third party
acquires the right to possession or use of a Product will be considered a sale
for the purpose of determining Net Sales.
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1.14
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“NDA”
shall mean a New Drug Application filed in the United States with
the
FDA.
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1.15
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“Patent
or Patents”
means the issued United States and foreign patents and the pending
applications set forth in Exhibit A, together with any and all
substitutions, extensions, divisionals, continuations,
continuations-in-part (to the extent that the subject matter is disclosed
and enabled in the parents), or foreign counterparts of such patent
applications and patents which issue thereon any where in the world,
including reexamined and reissued
patents.
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1.16
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“Phase
II”
means a human clinical trial, the principal purpose of which is to
evaluate the effectiveness of the Product for a particular indication
in
patients with the disease and to determine the common short-term
side
effects and risks associated with the Product as required in 21 C.F.R.
§312. A Phase II study shall be deemed to have been initiated when
the
first patient has been dosed with the drug
substance.
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1.17
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“Phase
III”
means expanded controlled and uncontrolled human clinical trials
performed
after Phase II evidence suggesting effectiveness of the Product has
been
obtained, and is intended to gather the additional information about
effectiveness and safety that is needed to evaluate the overall
benefit-risk relationship of the Product and to provide an adequate
basis
for physician labeling, as required in 21 C.F.R. §312. A Phase III study
shall also include any other human clinical trial intended to provide
the
substantial evidence of efficacy necessary to support the filing
of an
approvable NDA (such as a combined Phase II/Phase III study, or any
Phase III study in lieu of a Phase II study) (a “Pivotal Study”), whether
or not such study is a traditional Phase III study. A Phase III study
shall be deemed to have been initiated when the first patient has
been
dosed with the drug substance.
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1.18
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“Product”
means any method, service or product within the Field, the manufacture,
use, offer for sale or sale of which would infringe the Patent
rights.
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1.19
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“Reasonable
Commercial Efforts”
means efforts consistent with those used by comparable biotechnology
companies in the United States in research and development projects
for
therapeutic methods or compositions deemed to have commercial value
comparable to the Product.
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1.20
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“Reports”
means written summaries for each Product generally describing NILE's
efforts with respect to Development and Commercialization of the
Product,
including:
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(a)
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tests
and research completed;
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(b)
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any
filings made with any regulatory
authorities;
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(c)
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any
regulatory approvals received;
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(d)
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a
response to any comments that MAYO have made to any earlier Report,
including NILE's rationale for rejecting any suggestion contained
in such
comments;
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(e)
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reports
or minutes of any formal meetings with regulatory authorities, whether
convened in person or otherwise;
and
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(f)
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any
other major regulatory event, including but not limited to, placement
of a
“clinical hold” on a trial.
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1.21 “Sublicensee”
means an
entity to 'whom NILE sublicenses the right to offer for sale or sell the
Products in the Territory for the Field.
1.22 “Successful
Completion”
of a
Phase III clinical trial shall mean a clinical trial that yields data that
is
sufficiently statistically significant to permit NILE to file a
NDA.
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1.23 “Valid
Claim”
means an
issued claim of any unexpired patent or claim of any pending patent application
included among the Patents, which has not been held unenforceable, unpatentable
or invalid by a decision of a court or governmental body of competent
jurisdiction, unappealable or unappealed within the time allowed for appeal,
which has not been rendered unenforceable through disclaimer or otherwise,
and
which has not been lost through an interference proceeding or
abandoned.
1.24 “Territory”
means world-wide.
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Article
2 - Development and Commercialization
2.01 Agreements
of Nile.
NILE
agrees to use its commercially reasonable efforts to implement a program of
Development and Commercialization of the Product as soon as practically
possible. To achieve this goal, NILE agrees to:
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(a)
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conduct
a reasonable research and commercial development program to develop
a
Product;
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(b)
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expend
reasonable amounts towards the research and development of such
Products;
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(c)
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diligently
pursue worldwide regulatory approval of a
Product;
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(d)
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commence
marketing of a Product within [***] following regulatory approval
in the
United States.
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(e)
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comply
with all applicable laws in performing its obligations under this
Agreement, including in connection with obtaining the regulatory
approvals; and
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(f)
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perform
in good faith all of its obligations under this
Agreement.
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2.02 Management.
NILE
and its Affiliates shall assemble a management team, which shall
include:
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(a)
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a
management team with relevant drug development experience;
and
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(b)
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a
Board of Directors initially consisting initially of up to five
members.
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2.03 Scientific
Advisory Board.
NILE
will assemble a Scientific Advisory Board (“SAB”) consisting of experienced
thought leaders in the area of Congestive Heart Failure. Dr. ▇▇▇▇ ▇▇▇▇▇▇▇ shall
serve as the Chairman of the SAB, subject to restrictions, if any, of MAYO's
Conflict of Interest Committee, and subject to his reasonable availability.
NILE
shall compensate MAYO for ▇▇. ▇▇▇▇▇▇▇'▇ Know-How in this role at a rate of
Fifty
Thousand Dollars ($50,000.00) per annum, in addition to reimbursement of
reasonable travel expenses. This amount shall be paid quarterly {i.e. by March
31st, June 30th, September 30th and December 31st of each year) in equal
installments of Twelve Thousand Five Hundred Dollars ($12,500). It is understood
and agreed that ▇▇. ▇▇▇▇▇▇▇ will not be required to expend more than a maximum
of twenty-four (24) days per year in his capacity as Chairman of the
SAB,
2.04 Development
Plans and Reports.
NILE
agrees to provide MAYO with the Reports semi-annually, within 30 days of June
30th and December 31st, starting in the second License Year. Such Reports shall
be in sufficient detail for MAYO to among other things:
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(a)
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determine
whether NILE is using Reasonable Commercial Efforts to pursue the
regulatory approvals;
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(b)
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determine
whether NILE is using Reasonable Commercial Efforts to develop a
Development plan; and
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(c)
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determine
whether a Development plan, once developed and implemented, establishes
that NILE is using its Reasonable Commercial Efforts for Commercialization
of a Product.
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2.05 Notification.
NILE
agrees to notify MAYO within thirty (30) days if NILE determines that all
Development efforts have been terminated for all Products in which case MAYO
may
terminate this Agreement and the licenses granted hereunder without cause upon
thirty (30) days prior written notice.
2.06 Consultation
Regarding Reports.
MAYO
shall review the Reports and promptly inform NILE if MAYO reasonably believes
that the Development or Commercialization plans presented in the Reports are
not
adequate for a Product. NILE and MAYO will mutually confer, provided, however,
notwithstanding anything to the contrary herein, NILE has the final
decision-making authority.
2.07 Receipt
of Regulatory Approval.
NILE
shall notify MAYO within five (5) business days of receiving official notice
of
any regulatory approval for any Product.
Article
3 - Grant of Rights
3.01 Grant
of Rights.
MAYO
grants to NILE an exclusive, world-wide, royalty-bearing license, with the
right
to sublicense pursuant to Section 3.06, under the Patents and Improvements,
and
a nonexclusive right under the Know-How to develop, make, have made, use, sell,
import, offer to sell and commercialize Products within the Territory and within
the Field.
3.02 Reservation
of Rights.
The
grant of rights in Section 3.01 is subject to the Government Rights of the
United States government, if any, in the Patents and Know-How, and subject
to
MAYO' reservation of rights to make, have made and use the Patents and Products
on a royalty-free basis for MAYO' and its Affiliates internal non-commercial
clinical, research and education programs.
3.03 All
Other Rights Reserved.
Except
as granted in Section 3.01, or as otherwise expressly granted herein, no other
license is granted by MAYO under any intellectual property rights owned or
controlled by MAYO, including any patents, know-how, copyrights, proprietary
information, and trademarks. All such rights are expressly reserved by MAYO.
Except as provided herein, NILE acknowledges that in no event will this
Agreement be construed as an assignment by MAYO to NILE of any intellectual
property rights.
3.04 Confidentiality.
During
the Term, and for a period of three years thereafter, each Party hereto agrees
to keep confidential by not disclosing to any third party any information (i)
relating to this Agreement, including the terms and conditions thereof, or
(ii)
disclosed by one Party (the “Disclosing Party”) to the other (the “Receiving
Party”). The Parties may use this information solely as necessary for complying
with the terms and conditions of this Agreement. The obligations of
non¬disclosure and non-use will not apply when and to the extent such
information:
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(a)
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becomes
part of the public domain through no action or fault of the Receiving
Party; or
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(b)
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was
in the Receiving Party's possession before disclosure by the Disclosing
Party, as demonstrated by written records, and was not acquired,
directly
or indirectly, from the Disclosing Party;
or
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(c)
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was
received by the Receiving Party from a third party having a legal
right to
transmit such information.
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At
MAYO's
request, NILE will cooperate fully with MAYO, except financially, in any legal
actions taken by MAYO to protect its rights in the Patents and Know-how
disclosed hereunder.
For
avoidance of doubt, any violation of the obligations stated in this Section
3.04
constitutes a material breach of this Agreement.
3.05 Availability
of Product to MAYO.
Once a
Product becomes commercially available, to the extent permitted by law, NILE
will provide Products to MAYO and their Affiliates solely for it and their
use
for internal clinical, research and education programs in the Field at most
favored nation pricing, i.e. no more than the lowest price available to NILE's
commercial customers for the Products for use in the Field.
3.06 Sublicensee
Actions.
Nile
may enter into sublicensing agreements under the Patents. Nile shall not
receive, or agree to receive, anything of value in lieu of cash or equity as
consideration from a third party under a sublicense agreement (excluding (a)
any
amounts paid to NILE specifically designated for clinical research and
development of the Product, or (b) purchases of debt or equity securities of
NILE), without the prior written approval of MAYO. Nile agrees that any
sublicense agreement shall (i) contain provisions at least as favorable to
MAYO
for the protection of MAYO's rights and the limitation of MAYO's liability
exposure as the terms of this Agreement, including without limitation with
respect to name use, limitation of liability and indemnification, and
development and commercialization obligations commensurate in scope as those
set
forth for Nile in this Agreement, (ii) to the fullest extent applicable, contain
all rights and obligations due to MAYO contained in this Agreement, (iii) name
MAYO as a third party beneficiary and (iv) not permit the sublicensee to grant
further sublicenses. Nile shall (i) be and remain responsible for the
performance by such sublicensee with the terms of this Agreement, and any action
by a sublicensee that would, if conducted by Nile, be a breach of this
Agreement, shall be deemed a breach of this Agreement by Nile, and (ii)
ascertain, calculate, audit and collect all royalties that become payable by
such sublicensee hereunder and take appropriate enforcement action against
such
Sublicensee for any failure to pay or to properly calculate payments. Any
purported sublicense in violation of this Section 3.06 shall be
void.
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Nile
shall furnish to MAYO a true and complete copy of each sublicense agreement
and
each amendment thereto, within thirty (30) days after the sublicense or
amendment has been executed, which copy shall be the Confidential Information
of
Nile.
Article
4 - Consideration and Royalties
4.01 Initial
Consideration.
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(a)
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Upon
execution of this Agreement, NILE will pay MAYO an up-front payment
of
FIVE HUNDRED THOUSAND DOLLARS (US $500,000) as consideration for
entering
into the Agreement. This initial payment is nonrefundable and is
not an
advance or creditable against any royalties otherwise due under this
Agreement.
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(b)
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MAYO
shall be granted FIVE HUNDRED THOUSAND (500,000) shares of common
stock,
par value $0,001 per share (the “Common Stock”) representing ten percent
(10%) of the fully diluted stock of NILE as of the date of execution
of
this Agreement.
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4.02 Milestone
Payments.
NILE or
its Sublicensee shall make one-time milestone payments to MAYO as
follows:
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MILESTONE
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MILESTONE
PAYMENT
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Initiation
of the first company sponsored Phase II clinical trial of a
Product
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[***]
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Initiation
of the first U.S. company sponsored Phase III clinical trial of a
Product
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[***]
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Successful
completion of a U.S. company sponsored Phase III clinical trial of
a
Product
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[***]
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Acceptance
by the FDA of the first New Drug Application (“NDA”) for a
Product
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[***]
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Approval
by the FDA of the first NDA for a Product
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[***]
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Approval
by the FDA of an NDA for the first Product in each additional therapeutic
indication
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[***]
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Approval
by the FDA of an NDA for each additional Product
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[***]
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For
the
avoidance of doubt, “successful completion” of a Phase III clinical trial shall
mean one that yields data that is sufficiently statistically significant to
permit NILE to file an NDA.
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4.03 Milestones
Related to Funding from Mayo's Discovery-Translation
Program.
Within
sixty (60) days of the Effective Date, MAYO and NILE shall negotiate milestones
for the use of money awarded to ▇▇. ▇▇▇▇▇▇▇'▇ program by MAYO's
Discovery-Translation Program. If the parties agree to such milestones, the
parties will set forth a budget and the proposed milestones in Exhibit B. NILE
acknowledges that there is no requirement for MAYO to achieve the milestones.
MAYO will not be required to fund any activities except for the amounts agreed
upon in Exhibit B. In any event, such amount shall not exceed the award to
▇▇.
▇▇▇▇▇▇▇'▇ program of $[***]. For any money over $[***], up to, but not exceeding
$[***] (the “Additional Award”), which is spent from the Discovery-Translation
award for the Development of a Product, MAYO shall be granted the equivalent
dollar value in common stock of NILE, immediately upon the completion of the
first equity financing following the use of such Additional Award. The number
of
shares to be issued to MAYO pursuant to this Section 4.03 shall be determined
by
dividing the Additional Award by the per share price of the securities sold
in
such equity financing.
4.04 Earned
Royalties.
NILE or
its Sublicensee will pay MAYO [***] of the Net Sales of Products in the
Territory for use in the Field covered by at least one Valid Claim. The Earned
Royalties are payable as described in Section 5.01.
4.05 License
Maintenance Royalties.
In
order for NILE to maintain its exclusive license, NILE will pay MAYO a License
Maintenance Royalty of [***] in License Year 1 and 2 and a License Maintenance
Royalty of [***] in each License Year thereafter. Such License Maintenance
Royalties are fully creditable against the Milestone Payments described in
Section 4.02 hereto. For the avoidance of doubt the License Milestone Royalty
for License Year 1 shall be due on or before 20 January 2007. Failure to make
License Maintenance Payments shall be considered a material breach of this
Agreement.
4.06 Interest.
Any
payment that is not made on or before the date when due under this Agreement
shall accrue interest thereon from and including such date and until but
excluding the date of payment at the rate of one-half percent (0.5%) per month,
or, if such rate is in excess of the rate then permitted by applicable laws,
at
the highest rate so permitted.
4.07 Taxes.
NILE is
responsible for all applicable taxes (other than net income taxes), duties,
import deposits, assessments, and other governmental charges, however
designated, that are now or hereafter will be imposed by any authority in or
for
the Territory, based on or relating to:
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(a)
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the
Product or use of the Patents by NILE and/or NILE's Sublicensees;
or
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(b)
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the
import of the Product into the Territory by NILE and/or NILE's
Sublicensees.
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Notwithstanding
the foregoing, NILE shall not be responsible for any taxes arising from
transactions to which MAYO or any of their Affiliates may be parties exclusive
of transactions with NILE.
4.08 No
Deductions for Taxes.
Except
as otherwise stated herein, or unless otherwise agreed to in writing by MAYO
and
NILE, all payments to be made by NILE to MAYO under this Agreement represent
net
amounts MAYO is entitled to receive, and shall not be subject to any deductions
or offsets by NILE for any reason whatsoever. NILE, however, is not responsible
for any payments, including income tax, required to be paid by MAYO on funds
received from or on behalf of NILE.
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4.09 U.S.
Currency. All payments to MAYO under this Agreement will be made by draft drawn
on a United States bank, and payable in United States dollars.
4.10 Material
Breach. It shall be a material breach of this Agreement if NILE shall fail
to
make any payment pursuant to Article 4 of this Agreement when such payment
is
due or by the end of any applicable cure period.
Article
5 - Accounting and Reports
5.01 Royalty
Reports and Payments.
NILE
will, after Commercialization of at least one Product, deliver to MAYO on or
before 1 June, 1 September, 1 December and 1 March a written report for the
previous License Quarter stating, for each Product and for each country in
the
Territory in “which there are Net Sales:
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(a)
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the
number of Products sold during the period covered by the written
report;
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(b)
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a
description of all deductions from gross receipts applied to determine
Net
Sales;
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(c)
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amount
of royalty due thereupon for the period covered by the written report;
and
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(d)
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exchange
rates used to calculate the royalties
due.
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Each
such
report shall be accompanied by the royalty payment due for such License Quarter,
in accordance with this Article 5.
5.02 Audit
Rights.
NILE
agrees to maintain the Records and to require any permitted Sublicensees to
maintain the Records. “Records” mean complete and accurate records showing
clearly all transactions that are relevant to any sales, costs, expenses and
payments under this Agreement, to be kept in a manner consistent with generally
accepted accounting principles and standard operating procedures. MAYO shall
have the right, at its expense, through a certified public accountant or like
person reasonably acceptable to NILE, to examine the records of NILE and its
Sublicensees during regular business hours before the Termination or expiration
of this Agreement and for three (3) years thereafter, provided that such
examination shall not take place more often than once a year and shall be
limited to a report on the accuracy of royalty statements and payments. If
the
audit report for any License Year discloses an underpayment discrepancy in
royalties owed by NILE and royalties paid by NILE to MAYO that exceeds [***]
of
total Net Sales or Sublicense Revenue made until the date of completion of
the
audit, NILE shall pay the reasonable expense of the audit and pay to MAYO the
entire amount of the discrepancy plus interest within thirty (30) days from
the
date upon which MAYO notified NILE of the discrepancy. Interest shall be
computed at the rate which is the prime rate of Citibank N.A. (N.Y.) in effect
at 9:00 a.m. on the day that MAYO notifies NILE of the discrepancy.
Discrepancies in royalty payments for a License Year identified by the audit
report amounting to less than five percent (5%) shall be paid by the end of
the
License Quarter in which the audit was made.
11
Article
6 - Representations, Warranties and Indemnification
6.01 Representations
and Warranties.
MAYO
hereby represents and warrants to the best of its counsel's knowledge the
following:
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(a)
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MAYO
has the full right and power to perform the obligations and grant
the
License set forth in this
Agreement;
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(b)
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There
are no outstanding agreements, assignments or encumbrances in existence
inconsistent with the provisions of this
Agreement.
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(c)
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Subject
to Section 3.02, MAYO owns or possesses all right, title and interest
in
and to the Patents free and clear of all liens, charges, encumbrances
or
other restrictions or limitations of any kind
whatsoever.
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(d)
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Subject
to Section 3.02, there are no licenses, options, restriction, liens,
rights of third parties, disputes, royalty obligations, proceedings
or
claims relating to, affecting, or limiting its rights or the rights
of
NILE under this Agreement, which imposes obligations upon MAYO or
gives
any rights to MAYO which, in either case, would adversely affect
the
rights of NILE or the obligations of MAYO under this
Agreement.
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(e)
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There
is no claim, pending or threatened, of infringement, interference
or
invalidity regarding, any part or all of the Patents and their use
as
contemplated in the underlying patent applications as presently drafted
or
as contemplated under this
Agreement.
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(f)
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MAYO
has provided a copy of all pending patens and applications for which
▇▇.
▇▇▇▇▇▇▇ or ▇▇. ▇▇▇▇ is an inventor.
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6.02 No
Warranties.
Notwithstanding the foregoing, nothing in this Agreement will be construed
as:
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(a)
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a
warranty or representation by MAYO as to the validity or scope of
any of
the Patents; or
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(b)
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an
obligation to bring or to prosecute actions against third parties
for
infringement of the Patents; or
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(c)
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a
warranty or representation that the manufacture, use, sale, offer
for sale
or importation of any Product or the use or practice of any of the
Patents
are free from infringement or misappropriation of a third party's
intellectual property rights.
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12
6.03 Disclaimer.
MAYO HAS
NOT MADE AND PRESENTLY MAKES NO PROMISES, GUARANTEES, REPRESENTATIONS OR
WARRANTIES OF ANY NATURE, DIRECTLY OR INDIRECTLY, EXPRESS OR IMPLIED, REGARDING
THE MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR NON-INFRINGEMENT
FOR
THE PRODUCTS OR PATENTS. THE KNOW-HOW AND PATENTS PROVIDED OR LICENSED UNDER
THIS AGREEMENT ARE PROVIDED “AS IS,” “WITH ALL FAULTS,” AND “WITH ALL
DEFECTS”.
NILE
is
solely responsible for determining whether the Patents and Know-How provided
or
licensed hereunder have applicability or utility in NILE's manufacturing and
design activities. NILE assumes all risk and liability in connection with such
determination.
6.04 Indemnification
by NILE.
NILE
will defend, indemnify, and hold harmless MAYO and MAYO's Affiliates from any
and all claims, actions, demands, judgments, losses, costs, expenses, damages
and liabilities (including but not limited to reasonable attorneys fees and
other out-of- pocket expenses incurred in litigation) (collectively, “Claims”),
regardless of the legal theory asserted, arising out of or connected with:
(a)
use by NILE of Patents or Know-How furnished or licensed under this Agreement;
(b) development, design, manufacture, distribution, use, sale, or other
disposition of products, including Products, by NILE or its transferees or
Mayo
and/or it Affiliates; and (c) any clinical trial funded or conducted by NILE,
unless such Claims are judicially determined to have arisen out of the gross
negligence or willful misconduct of MAYO or its Affiliates. As used herein,
MAYO
and its Affiliates include the trustees, officers, agents, and employees of
MAYO
and its Affiliates. NILE will, during the Term, carry occurrence-based liability
insurance, including products liability and contractual liability, in an amount
and for a time period sufficient to cover the liability assumed by NILE
hereunder, such amount being at least [***], provided that a lesser amount
shall
be acceptable to MAYO until such time as the Product enters into human clinical
trials. In addition, such policy will name MAYO as an additional-named insured
party.
6.05 Additional
Waivers.
IN NO
EVENT WILL MAYO'S LIABILITY OF ANY KIND INCLUDE ANY SPECIAL, INDIRECT,
INCIDENTAL, OR FUTURE DAMAGES, EVEN IF MAYO HAS BEEN ADVISED OF THE POSSIBILITY
OF SUCH DAMAGES. IN NO CASE WILL MAYO'S LIABILITY OF ANY KIND EXCEED THE TOTAL
AMOUNTS WHICH HAVE ACTUALLY BEEN PAID TO MAYO BY NILE AS OF THE DATE OF FILING
OF THE ACTION AGAINST MAYO WHICH RESULTS IN THE SETTLEMENT OR AWARD OF
DAMAGES.
Article
7 - Term and Termination
7.01 Term.
Unless
sooner terminated, this Agreement shall continue in full force and effect until
the later of (a) the expiration of the last to expire valid claim contained
in
the Patents and (b) the 20th anniversary of this Agreement.
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7.02 Material
Breach.
MAYO
shall be entitled to terminate this Agreement at any time based upon material
breach if NILE has failed to cure such material breach within ninety (90) days
of receipt of notice by NILE from MAYO that NILE is in breach.
7.03 Termination
for Other than Material Breach.
NILE may
terminate the Agreement without cause upon ninety (90) days prior written
notice.
7.04 Termination
for Challenge.
MAYO may
terminate this Agreement by transmitting a notice of termination to NILE in
the
event NILE challenges the validity or enforceability of any of the Patent Rights
in any manner.
7.05 Insolvency
of Company.
MAYO may
terminate this Agreement by transmitting a notice of termination to NILE in
the
event NILE ceases conducting business in the normal course, becomes insolvent
or
bankrupt, makes a general assignment for the benefit of creditors, admits in
writing its inability to pay its debts as they are due, permits the appointment
of a receiver for its business or assets, or avails itself of or becomes subject
to any proceeding under any statute of any governing authority relating to
insolvency or the protection of rights of creditors.
7.06 Effect
of Termination.
Upon
termination of this Agreement, all rights granted therein will immediately
revert to MAYO with no further notice or action required on the MAYO's behalf.
NILE shall negotiate in good faith for an agreement, which shall be on
commercially reasonable terms, under which NILE would provide to MAYO and grant
the rights to use full and complete copies of all toxicity, efficacy, and other
data generated solely by NILE (including by contractors or agents on their
behalf, specifically excluding MAYO) in the course of NILE's efforts to develop
Products or obtain governmental approval for the sale of Products, for use
in
connection with the development and commercialization of Products.
7.07 Survival.
The
following obligations survive the expiration or termination of this
Agreement:
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(a)
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NILE's
obligation to supply reports covering the time period up to the date
of
termination or expiration;
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(b)
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MAYO'
right to receive payments, fees, and royalties accrued or accruable
from
payment at the time of any termination or expiration;
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(c)
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NILE's
obligation to maintain records, and MAYO' right to have those records
inspected;
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(d)
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any
cause of action or claim of MAYO, accrued or to accrue, because of
any
action or omission by NILE;
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(e)
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NILE's
obligations stated in Section 2.06 for data developed prior to termination
or expiration, Sections 3.04 and 3.06; the applicable sections of
Article
6; Sections 7.06, 7.08 and 7.09; and Article 10;
and
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14
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(f)
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MAYO'
obligations stated in Section 3.04 and 10.01, and the applicable
sections
of Articles 6 and 10.
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7.08 Inventory.
NILE
shall notify MAYO within thirty (30) days of the effective date of termination
of this Agreement the amounts, if any, of Product that NILE, its Sublicensees
and distributors then have in inventory in each country or Territory. At MAYO'
election, NILE, its Sublicensees and distributors may sell the Product in that
country or Territory if NILE pays royalties thereon in accordance with Sections
4.03 and 5.01. In the event that MAYO does not permit the sale of the inventory,
MAYO will direct NILE to return the inventory to MAYO or to destroy the
inventory, at the cost of MAYO. Return of Confidential Information. Within
thirty (30) days of the effective date of termination of this Agreement, each
of
the Parties shall return all of the other Party's Confidential Information,
including all copies thereof; provided, however, that each Party shall be
entitled to retain one copy of all such Confidential Information in its legal
department so that any continuing obligations of confidentiality may be
determined.
Article
8 - Patent Filing, Prosecution and Maintenance
8.01 Patent
Filing, Prosecution and Maintenance.
Following execution of this Agreement, NILE shall be responsible for the
prosecution and maintenance of all Patents and Patent applications, at NILE's
expense, using counsel reasonably acceptable to MAYO, and shall keep MAYO
informed of prosecution
8.02 Patent
Term Extension.
MAYO
will have the sole right to decide on which Patent(s) to obtain a patent term
extension; provided that MAYO will consider NILE's input on the matter. NILE
agrees to do all things which MAYO determines are necessary to ensure the timely
and complete filing and prosecution of any application for a patent term
extension with the United States Patent and Trademark Office for any Licensed
Product. NILE's duties shall include, but not be limited to, providing MAYO
with
any information and notifications reasonably necessary for obtaining a patent
term extension.
Article
9 - Patent Rights Enforcement
9.01 Third
Party Litigation.
In the
event a third party institutes a suit against NILE for patent infringement
involving a Product, NILE will promptly inform MAYO and keep MAYO regularly
informed of the proceedings. In the event the third party sues or joins MAYO,
MAYO will have the right to control the defense of the suit. Each Party will
bear its own costs of the suit and any recovery will be shared equally by the
Parties.
9.02 Infringement
by Third Party.
NILE and
MAYO will promptly inform the other Party in writing of any alleged infringement
of any Patent and provide the other Party with available evidence of such
infringement, and MAYO and NILE will have the right to institute an action
for
infringement of the Patents consistent with the following:
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(a)
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If
MAYO and NILE agree to institute suit jointly, then the suit will
be
brought in the names of both parties. NILE will exercise control
over such
action, provided, however, that MAYO may, if it so desires, be represented
by counsel of its own selection, and at its own
expense.
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(b)
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In
the absence of an agreement to institute a suit jointly, MAYO may
institute suit and, at its option, join NILE as a plaintiff. MAYO
will
bear the entire cost of such litigation, including attorneys' fees.
NILE
will cooperate reasonably with MAYO, except financially, in such
litigation. MAYO will not settle or enter into a voluntary disposition
of
the action without NILE's prior written
consent.
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(c)
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In
the absence of an agreement to institute a suit jointly, and if MAYO
determines not to institute a suit, as provided in paragraph (b)
of this
Section 9.02, then NILE may institute suit and, at its option, join
MAYO
if MAYO is a necessary party to the litigation. NILE will bear the
entire
cost of such litigation, including attorneys' fees. MAYO will cooperate
reasonably with NILE, except financially, in such litigation NILE
will not
settle or enter into a voluntary disposition of the action without
MAYO's
prior written consent.
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(d)
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Absent
an agreement to the contrary, any costs under (a) above will be borne
equally by the Parties and any recoveries will be shared in proportion
to
the economic damages suffered by each Party. Otherwise, each Party
will
bear its own expenses and any recovery will be applied as
follows:
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(i)
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first,
to reimburse the Party bringing the
action;
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(ii)
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second,
to reimburse the expenses of the other Party in connection with such
action; and
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(iii)
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third,
[***] percent ([***]%) to MAYO and [***] percent ([***]%) to
NILE.
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(e)
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If
either Party institutes a suit under this Section 9.02 and then decides
to
abandon the suit, it will first provide timely written notice to
the other
Party of its intention to abandon the suit, and the other Party,
if it
wishes, may continue prosecution of such suit, provided, however,
that the
sharing of expenses and of any recovery in such suit will be agreed-upon
separately by the Parties.
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9.03 Patent
Marking.
To the
extent commercially feasible and customary in the trade, NILE will ▇▇▇▇ all
Products that are manufactured or sold under this Agreement with the number
of
each issued patent within the Patents that cover such Product(s). Any such
marking will be in conformance with the patent laws and other laws of the
country of manufacture or sale.
Article
10 - General Provisions
10.01 Name
Use.
This
Agreement does not convey any right to use any of the other Party's names or
logos other than where required by law, rule or regulation. Neither Party may
use publicly for publicity, promotion, or otherwise, any logo, name, trade
name,
service ▇▇▇▇ or trademark of the other Party or its Affiliates, or any
simulation, abbreviation or adaptation of the same, or the name of any of the
other Party's employee or agent without such other Party's prior, written,
express consent other than where required by law, rule or regulation. MAYO's
marks include, but are not limited to, the terms “MAYO®” and “MAYO CLINIC®.” Any
violation of this Section 10.01 constitutes a material breach of this
Agreement.
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10.02 Assignment.
Nile
may assign its rights and obligations under this Agreement to a third party
in
conjunction with a Change of Control without Mayo's prior written consent;
provided that Nile shall remain responsible for the performance of its assignee,
the assignee agrees to assume and be bound by the provisions of this Agreement
in writing and Nile promptly notifies Mayo of such assignment. Mayo's written
consent, which shall not be unreasonably withheld, shall be required prior
to
any other assignment of Nile's rights or obligations hereunder. Any other
purported assignment is void.
10.03 Waiver.
The
failure of a Party to complain of any default by another Party or to enforce
any
of such Party's rights, no matter how long such failure may continue, will
not
constitute a waiver of the Party's rights under this Agreement. The waiver
by a
Party of any breach of any provision of this Agreement shall not be construed
as
a waiver of any subsequent breach of the same or any other provision. No part
of
this Agreement may be waived except by the further written agreement of the
Parties.
10.04 Governing
Law and Jurisdiction.
This
Agreement is made and performed in Minnesota. It is governed by Minnesota law,
but specifically not including Article 2 of the Uniform Commercial Code as
enacted in Minnesota. This is not an Agreement for the sale of goods. In
addition, no Minnesota conflicts-of-law or choice-of-laws provisions apply
to
this Agreement. To the extent the substantive and procedural law of the United
States would apply to this Agreement, it supersedes the application of Minnesota
law. The exclusive for a for actions between the Parties in connection with
this
Agreement are the State District Court sitting in Olmsted County, Minnesota,
or
the United States Court for the District of Minnesota. NILE agrees
unconditionally that it is personally subject to the jurisdiction of such
court.
10.05 Headings.
The
headings of articles and sections used in this document are for convenience
of
reference only, and shall not affect the meaning or interpretation of this
Agreement.
10.06 Notices.
All
notices and other business communications between the Parties related to this
Agreement shall be in writing, sent by certified mail, addressed as
follows:
If
to
MAYO:
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▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇
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||
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▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
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||
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Attn:
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▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇, Ph.D.
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COPY
TO
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Office
of Technology Commercialization
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Mayo
Legal
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Mayo
Medical Ventures
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Attn:
General Counsel
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Telephone
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:▇▇▇-▇▇▇-▇▇▇▇
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Telephone:
▇▇▇-▇▇▇-▇▇▇▇
|
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Facsimile:
|
▇▇▇-▇▇▇-▇▇▇▇
|
Facsimile:
▇▇▇-▇▇▇-▇▇▇▇
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Email:
|
▇▇▇▇▇▇▇▇▇@▇▇▇▇.▇▇▇
|
|
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Nile
Pharmaceuticals, Inc.
▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇
▇▇▇▇ ▇▇▇ ▇▇▇▇
Attn:
▇▇▇▇▇ ▇▇▇▇▇
Telephone:
▇▇▇-▇▇▇-▇▇▇▇
Facsimile:
▇▇▇-▇▇▇-▇▇▇▇
Email:
▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇
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17
Notices
sent by certified mail shall be deemed delivered on the third day following
the
date of mailing. A Party may change its address or facsimile number by giving
written notice in compliance with this section.
10.07 Limitation
of Rights Created.
This
Agreement is intended only to benefit the Parties hereto and is not intended
to
confer upon any other person any rights or remedies hereunder.
10.08 Independent
Contractors.
It is
mutually understood and agreed that the relationship between the Parties is
that
of independent contractors. No Party is the agent, employee, or servant of
the
other. Except as specifically set forth herein, no Party shall have or exercise
any control or direction over the methods by which the other Party performs
work
or obligations under this Agreement. Further, nothing in this Agreement is
intended to create any partnership, joint venture, or lease, expressly or by
implication, between the Parties.
10.09 Entire
Agreement.
This
Agreement constitutes the final, complete and exclusive agreement between the
Parties with respect to its subject matter and supersedes all past and
contemporaneous agreements, promises, and understandings, whether oral or
written, between the Parties.
10.10 Binding
Effect.
This
Agreement shall be binding upon and inure to the benefit of the Parties, their
heirs, legal representatives, successors and assigns.
10.11 Severability.
In the
event any provision of this Agreement is held to be invalid or unenforceable,
the remainder of this Agreement shall remain in full force and effect as if
the
invalid or unenforceable provision had never been a part of the
Agreement.
10.12 Amendments.
This
Agreement may not be amended or modified except by a writing signed by the
Parties and identified as an amendment to this Agreement.
10.13 Construction.
The
Parties agree to all of the terms of this Agreement. The Parties execute this
Agreement only after reviewing it thoroughly. That one Party or another may
have
drafted all or a part of this Agreement will not cause this Agreement to be
read
more strictly against the drafting Party. This Agreement, and any changes to
it,
will be interpreted on the basis that the Parties contributed equally to the
drafting of all of its parts.
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10.14 Nondisclosure.
Except
as permitted herein, neither Party will disclose any of the terms of this
Agreement without the express, prior, written consent of the other Party, or
unless required by law or a regulatory authority.
10.15 Counterparts.
This
Agreement shall become binding as of the Effective Date when any one or more
counterparts hereof, individually or taken together, shall bear the signatures
of each of the Parties hereto. This Agreement may be executed in any number
of
counterparts, each of which shall be an original as against any Party whose
signature appears thereon but all of which together shall constitute but one
and
the same instrument.
IN
WITNESS WHEREOF,
MAYO and
NILE have caused this Agreement to be signed as of the Effective Date by their
respective representatives.
MAYO
FOUNDATION FOR MEDICAL EDUCATION AND RESEARCH:
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/s/
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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1/18/06
|
|
NAME:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
TITLE:
ASSISTANT TREASURER
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DATE
|
|
READ,
UNDERSTOOD AND AGREED:
/s/
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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1/18/06
|
|
▇▇▇▇
▇. ▇▇▇▇▇▇▇, M.D.
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DATE
|
| /s/ ▇▇▇▇▇▇ ▇▇▇▇ | 1/18/06 |
|
▇▇▇▇▇▇
▇▇▇▇, M.D., PH.D.
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DATE
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|
NILE
PHARMACEUTICALS, INC:
|
|
| /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ | 1/18/06 |
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NAME: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
TITLE:
President
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DATE
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19
EXHIBIT
A
PATENTS
US
Patent
granted June 2002, #6,407,211;
US
Patent
granted November 2004, #6,818,619;
US
Application Serial Number 10/947,730;
European
Application Number 00988092.3;
Canadian
Application Number 2,395,585; and
Japanese
Application Number 2001-544773.
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