Exhibit
10.4
AMENDED AND RESTATED LICENSE
AGREEMENT
THIS AMENDED AND RESTATED LICENSE
AGREEMENT (the “
Agreement ”), dated as of February 1, 2005, is between
ALLEGHENY-SINGER RESEARCH INSTITUTE, a Pennsylvania nonprofit
corporation with an address at 320 East North Avenue, Pittsburgh,
Pennsylvania 15212 (" ASRI ") and Omnimmune Corp., a Texas
corporation located at 4600 Post Oak Place, Suite 152, Houston,
Texas 77027 (the " Company ").
WHEREAS, the parties hereto (each, a “ Party
,” and together, the “ Parties ”) entered
into a License Agreement, dated as of February 3, 1999 (the “
Original Agreement ”), and desire to amend and restate
the Original Agreement in its entirety as set forth
below;
NOW,
THEREFORE , in
consideration of the mutual promises contained herein and other
valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, and with the intent to be legally bound
hereby, the parties hereto amend and restate the Original Agreement
in its entirety as follows:
a.
"
Affiliate " shall mean any corporation or other business
entity that directly or indirectly controls, is controlled by, or
is under common control with the Company. Control means ownership
or other beneficial interest in 50% or more of the voting stock or
other voting interest of a corporation or other business
entity.
b. “
Claim ” shall mean a claim (a) of any issued,
unexpired patent that has not been revoked or held unenforceable or
invalid by a decision of a court or governmental agency of
competent jurisdiction from which no appeal can be taken, or with
respect to which an appeal is not taken within the time allowed for
appeal, or (b) of any patent application that has not been
cancelled, withdrawn or permanently abandoned nor been pending for
more than (i) seven (7) years, if such patent application is
pending in any country other than Japan or (ii) ten (10) years, if
such patent application is pending in Japan.
c. “
Confidential Information ” shall mean all confidential
or proprietary materials or information designated as such in
writing by the party disclosing such information (the “
Disclosing Party ”), whether by letter or by the use
of an appropriate proprietary stamp or legend, prior to or at the
time any confidential or proprietary materials or information is
disclosed by the Disclosing Party to the receiving party (the
“ Recipient ”). Notwithstanding the
foregoing, information or materials which are orally or visually
disclosed to the Recipient by the Disclosing Party, or are
disclosed in writing or other tangible form without an appropriate
letter, proprietary stamp or legend, shall constitute Confidential
Information if the Disclosing Party, within thirty (30) days after
such disclosure, delivers to the Recipient a written document or
documents describing such information or materials and referencing
the place and date of such oral, visual or written or other
tangible disclosure, and the names of the employees or officers of
the Recipient to whom such disclosure was made.
d. “
Cost of Goods Sold ” shall mean, with respect to a
Licensed Product, the Company’s or any of its
Affiliates’ actual cost to acquire the Licensed Product from
a non-Affiliate third party or the Company’s or such
Affiliates’ direct variable costs for materials and labor to
make the Licensed Product, excluding all allocations of indirect
costs and all overhead, including without limitation rent, real
estate depreciation, utilities, insurance, equipment lease
payments, equipment depreciation, and selling, general and
administrative or similar expenses.
e.
“ Effective Date ” shall mean February 1,
2005.
f.
"
Fair Market Value " shall mean the cash consideration which
the Company, its Affiliate or Sublicensee would realize from an
unaffiliated, unrelated buyer in an arms' length sale of an
identical item sold in the same quantity and at the same time and
place of the transaction.
g. “
FDA ” shall mean the United States Food and Drug
Administration, or any successor agency thereof or foreign
counterpart thereof.
h.
"
Field " shall mean i) Cancer diagnosis and therapy (active
and passive immunotherapy) in animals and humans, and ii) fertility
control in animals and humans.
i.
“ First Sale ” shall mean, with respect to a
Licensed Product in a country, the first commercial sale of such
Licensed Product by Licensee, its Affiliates or Sublicensees in
such country. Sales for test marketing, clinical trial
purposes or compassionate or similar use shall not be considered to
constitute a First Sale.
j. “
Know-How ” shall mean any information, inventions,
discoveries, copyrights, trade secrets, data or materials, whether
proprietary or not, including without limitation data generated in
pre-clinical and clinical studies.
k. "
Licensed Information " shall mean research and development
information, records and data, unpatented inventions, and Know-How,
relating to Licensed Products in the Field, which were (i)
developed by ASRI through or under the direction of Drs. Hernan
Acevedo or Gavreel Kalantarov and others under their direction at
ASRI prior to the Effective Date of the Original
Agreement and (ii) provided by ASRI to Company or provided by a
third party to Company at ASRI's authorization.
l.
" Licensed Material " shall mean the
tangible physical material listed in Attachment A hereto and any
Company developed progeny or derivatives thereof including those
antibodies listed in Attachment A, and any monoclonal antibody
(MAb) and/or cell lines that Company, its Affiliates or
Sublicensees acquire that are derived from amino acid or DNA
sequences of the antibodies listed in Attachment
A. MAb's shall also be deemed to include the use of cell
lines used to produce MAb's.
m. "
Licensed Patents " shall mean:
(i) the United
States and foreign patents and patent applications listed in
Attachment A hereto, and any patents issuing therefrom that are
owned or controlled, in whole or in part, by ASRI as of the date of
the Original Agreement, including. provisional patent applications
and Patent Cooperation Treaty (PCT) patent applications, all
divisions and continuations of these applications, all patents
issuing from such applications, divisions, and continuations, and
any reissues, reexaminations, and extensions of all such
patents;
(ii) to
the extent that the following contain one or more claims directed
to that described in subsection (i) immediately above: a)
continuations-in-part of (i) above; b) all divisions and
continuations of these continuations-in-part; c) all patents
issuing from such continuations-in-part, divisions, and
continuations; and d) any reissues, reexaminations, and extensions
of all such patents;
(iii) to
the extent that the following contain one or more claims directed
to that described in subsection (i) immediately above: all
counterpart foreign applications and patents related to that
described in subsections (i) and (ii) above, including those listed
in Appendix A.
n.
" Licensed Product " or " Licensed Products " shall
mean any product or service, the development, manufacture,
use,sale, rental or lease of which (i) is covered by a claim of a
Licensed Patent or (ii) involves the use of Licensed Material
and/or Licensed Information.
o .
"
Milestones " shall mean those objectives set forth in
Section 6.a below.
p.
" Milestone Payments " shall mean those payments due to ASRI
under Section 6.a below.
q.
"
Net Sales " shall mean the total of all cash consideration
or, if none, the Fair Market Value attributable to the Sale of
Licensed Products by the Company and its Affiliates less returns
and customary trade discounts actually taken, outbound freight,
transportation insurance, value added, sales or use taxes,and
custom duties and reasonable reserve for bad debts accrued in
accordance with the Company’s standard accounting practices
applied consistently across the Company’s and its
Affiliates’ business. In the case of transfers of Licensed
Products to an Affiliate by the Company for sale, rental, or lease
of such Products to third parties by such Affiliate, Net Sales
shall be based upon the greater of the total fees and other
consideration charged by the Affiliate to third parties or the
total fees and consideration charged by the Company to the
Affiliate. Net Sales for Licensed Products sold by
Company or its Affiliate(s) as a unit in conjunction with other
services or products will be determined pro rata in accordance with
the respective stand-alone price or value of such products and/or
services.
r. “
Patent Rights ” shall mean all patents and patent
applications (including any continuations of any such patent
applications, claims in continuations-in-part to the extent such
claims are entirely supported by the specifications of any such
patent applications, and any divisionals, provisionals or
substitute applications with respect to any such patent
applications), any patent issued with respect to any such patent
applications,any reissue,reexamination, renewal or
extension (including any supplemental patent certificate)
of any such patent, and any confirmation patent or
registration patent or patent of addition based on any such patent,
and all counterparts of any of the foregoing.
s. "
Sale " shall mean any bona fide transaction for which
consideration is received or expected for the sale, use, lease,
transfer or other disposition of Licensed Product(s). A
Sale of Licensed Product(s) shall be deemed to be completed at the
time Company or any of its Affiliates invoices for, ships, or
receives payment for such Licensed Product(s),whichever occurs
first.
t. "
Sublicense Agreement " shall mean a sublicense agreement
executed by the Company and a Sublicenseee pursuant to this
Agreement.
u. "
Sublicensee " shall mean any third party to whom the Company
has granted a sublicense pursuant to this Agreement.
v. “
Sublicense Revenue ” shall mean all
amounts actually received by the Company and/or its Affiliates
from third parties in connection with or related to the licensing
or sublicensing to such third parties of rights with respect to
Licensed Products, including without limitation (a) all sublicense
fees, royalties paid to Company by Sublicensees and Milestone
Payments, (b) transfer pricing (as defined below) amounts paid
in respect of Licensed Products supplied to such third parties, (c)
investments in securities and (d) research and development funding
received by the Company, excluding from Sublicense Revenue,
however, that described in subsections (i), (ii) and (iii) below
and subject to subsections (iv) and (v) below:
(i)
transfer pricing amounts equal to the
Company's and/or its Affiliates' Cost of Goods Sold in respect of
Licensed Products supplied to such third parties (where
“ transfer pricing ” is the price that is
assumed to have been charged by one part of the Company for
products and services it provides to another part of the Company,
in order to calculate each division's profit and loss
separately);
(ii)
amounts received by the Company and/or its
Affiliates from such third parties as the purchase price for the
Company’s and/or its Affiliates' debt or equity securities at
prices not in excess of the then-current market price of such
securities or, if such securities are not publicly traded, the
then-current fair market value of such securities; and
(iii) amounts
received by the Company and/or its Affiliates for (including
as reimbursement) research and development activities undertaken
after the execution date of the relevant third party license or
sublicense agreement, for, or in collaboration with, such third
parties at rates not to exceed the fair market value of such
services.
(iv) At
the Company’s sole discretion and on prior written notice to
ASRI, Sublicense Revenue shall not include any amounts constituting
(1) bona fide research and development funding directly relating to
potential Licensed Products, as reflected in the Company’s
books and records in accordance with generally accepted accounting
principles, to the extent that such funding is actually used for
such purpose within the Company, and (2) amounts reimbursed by a
third party for Company payments to any third party for bona fide
research and development activities directly relating to potential
Licensed Products, as reflected in the Company’s books and
records in accordance with generally accepted accounting
principles. The parties acknowledge and agree that (x)
the two exceptions to Sublicense Revenue described above in this
subsection (iv) shall apply only to direct expenses actually paid
by the Company for bona fide research and development activities,
including salaries of full and part-time employees, consultants and
advisors, and shall only apply to research and development
activities undertaken after the Effective Date of this Agreement
and, with respect to such Sublicense Revenue, after
execution by the Company and a Sublicensee of the relevant
Sublicense Agreement related thereto; and (y) the Company may
not include in amounts excluded from Sublicense Revenue its own
internal costs other than those reasonably allocated to the
research and development project related to ASRI’s Licensed
Products.
(v) If
and to the extent that a Sublicensee makes a bona fide equity
investment in capital stock of Company, or a security convertible
into or exchangeable for capital stock of the Company (a “
Convertible Security ”), then only such portion, if
any, of the consideration paid for such capital stock or
Convertible Security that is in excess of the aggregate Fair Market
Value (as defined below) of the shares of such capital stock
issued or issuable by Company to Sublicensee shall be deemed to be
Sublicense Revenue.
As used herein, the “ Fair Market
Value ” per share of capital stock shall mean (A) if such
class of capital stock is then traded on a national securities
exchange or the Nasdaq National Market (or a similar national
quotation system), an amount equal to the average of the closing
prices per share of shares of such class of capital stock on such
exchange or system for the twenty (20) trading-day period ending
three (3) days prior to the date of issuance of such capital stock
or Convertible Security to Sublicensee; (B) if such class of
capital stock is then traded over-the-counter, an amount equal to
the average of the closing bid prices per share of shares of such
class of capital stock over the twenty (20) trading day period
ending three (3) days prior to the date of issuance of such capital
stock to Sublicensee; and (C) if such class of capital stock is not
then traded on a national securities exchange, any such national
quotation system or over-the-counter, an amount per share equal to
the lowest amount of consideration per share paid in consideration
for the bona fide issuance of any shares of such class of capital
stock (other than to Sublicensee or to employees, consultants,
directors or advisors (collectively “ Optionees
”) pursuant to the Company’s employee stock option
plan) during the period beginning twelve (12) months prior to the
date of issuance of such shares of capital stock to Sublicensee;
provided that such amount shall be reduced from time to time to an
amount equal to the lowest amount of consideration per share paid
in consideration for the bona fide issuance of any shares of such
class of capital stock (other than to Sublicensee (or Optionees)
during the period ending twelve (12) months after the date of such
issuance to Sublicensee, if the amount of any such consideration is
less than the lowest amount of such consideration paid during the
period beginning twelve (12) months prior to the date of such
issuance to Sublicensee; provided, further, that if there has not
been any bona fide issuance of shares of such class of capital
stock (other than to Sublicensee or Optionees) during the twelve
(12) months prior to the date of any such issuance to Sublicensee
or if the consideration for such shares of capital stock issued by
Company to Sublicense or to any other person or entity in an
issuance within the twelve (12) months prior to or following the
date of any such issuance to Sublicense consists of any
consideration other than cash, then the Board of Directors of
Company shall, within thirty (30) days following the date of such
issuance to Sublicense (or the date of any issuance within 12
months following the date of issuance to Sublicense) make a good
faith determination as to the Fair Market Value of the shares
issued to Sublicense and furnish to ASRI a written report setting
forth in reasonable detail the basis for such determination, and
shall promptly furnish to ASRI all such additional information as
ASRI may request in connection with its review of such
determination. If ASRI and Company fail to agree on such
determination within (30) days following the date ASRI receives
such report, then the Fair Market Value of such shares shall be
determined by an independent accounting firm, investment bank or
valuation firm which has not had any relationship with ASRI or the
Company, an Affiliate or Sublicensee for a period of three years
prior to such determination (the “ Appraiser ”);
the parties, acting reasonably and in good faith, shall mutually
agree upon the Appraiser. Company shall promptly furnish
to the Appraiser all such information as the Appraiser may request
in connection with such determination. The fees
and expenses of the Appraiser shall be shared equally by the
Company and ASRI; provided that if the Fair Market Value determined
by the Appraiser is less than ninety-five (95%) of the Fair Market
Value as determined by Company’s Board of Directors, then all
such fees and expenses shall be borne by Company.
If non-monetary consideration is received from
third parties by the Company and/or its Affiliates, then a
commercially reasonable monetary value will be assigned for
purposes of calculating Sublicense Revenue.
2. License
Grant.
a. ASRI grants to the
Company, upon and subject to all the terms and conditions of this
Agreement:
(i) with respect to
any right, title or interest ASRI may have in the Licensed Patents,
and/or Licensed Material, an exclusive worldwide license to use the
Licensed Patents and Licensed Material, as specified in Attachment
A, to develop, manufacture, use, sell, have sold, rent, or lease
Licensed Products in the Field; and
(ii) with respect to
any right title or interest ASRI may have in the Licensed
Information, a nonexclusive, worldwide license to use the Licensed
Information to develop, manufacture, use, sell, have sold, rent or
lease Licensed Products in the Field. The Company will
treat as confidential any and all Licensed Information furnished
hereunder, and will not disclose the same to any third party
without ASRI's written permission.
b. ASRI represents
and warrants that except as for the Licensed Information and as set
forth on Attachment A attached hereto (i) it has not transferred by
license or otherwise any rights in the Licensed Patents or Licensed
Materials to any person or party, and (ii) it has not knowingly
taken any action or omitted to take any action that would result in
the invalidity, reduction in scope, or abandonment of any of the
Licensed Patents. ASRI further covenants that it will not knowingly
and intentionally take or omit to take any of the actions described
in the immediately preceding sentence, and will require any other
licensee of the Licensed Patents or Licensed Material directly
under contract with ASRI not to take or omit to take any of the
actions described in the immediately preceding sentence, unless the
prior written consent of the Company is obtained.
c. ASRI grants to the
Company the right to grant non-exclusive sublicenses of the
Licensed Patents, the Licensed Materials and the Licensed
Information to third parties in the Field, provided that (i) the
Sublicensee agrees to abide by all the terms and provisions of this
Agreement; (ii) the Company remains fully liable for the
performance of its and its Sublicensees’ obligations
hereunder; (iii) the Company notifies ASRI of any grant of any such
sublicense and provides to ASRI upon ASRI's request a copy of any
sublicense agreement; and (iv) no such sublicense shall relieve the
Company of its obligations under Section 6 hereof.
d. Except as
expressly provided in this Section 2, ASRI is not granting the
Company any rights or license to any patents, patent applications,
copyrights, trade secrets, Know How, trademarks or any other
intellectual property right.
e. All rights granted
by ASRI to the Company under this Agreement are subject to the
requirements of 35 U.S.C. §§ 200 et seq. as amended, and
implementing regulations and policies with regard
thereto.
f. Except as
expressly set forth in this agreement, and notwithstanding anything
to the contrary in this agreement, the original agreement, or any
other agreement between the parties hereto, the company
acknowledges and agrees that ASRI makes no warranties,
representations or guarantees of any kind, express or implied,
regarding any right, title or interest ASRI may have in and to the
subject of any license granted under this section and this
agreement, including without limitation, licensed patents, licensed
information and licensed materials, and any technology or other
information embodied therein.
3.
Royalties and
Payments.
a. In consideration
of the license granted under Section 2a of this Agreement, the
Company shall pay to ASRI:
(i) Patent Prosecution
Expenses - Company shall reimburse ASRI $25,000 after Sales of
Licensed Products by Company, its Affiliates, or Company's
successors or any combination thereof, an amount aggregating at
least one million dollars ($1,000,000);
(ii) a royalty of 1% of
Net Sales of all Licensed Products that involve use of Licensed
Material or Licensed Information but are not covered by a Claim of
a Licensed Patent, for a period of ten (10) years from the date of
the First Sale of each such Licensed Product;
(iii) a royalty of 1% of
Net Sales of all Licensed Products that involve use of Licensed
Material or Licensed Information but are covered by a Claim of a
Licensed Patent pursuant to a non-exclusive license hereunder, for
a term of ten (10) years from the date of the First Sale of each
such Licensed Product; and
(iv) a royalty of 2% of
Net Sales of all Licensed Products covered by a Claim of a Licensed
Patent exclusively licensed to the Company hereunder , for a
period of ten (10) years from the date of (i) the First Sale of
each such Licensed Product or (ii) the last to expire Licensed
Patent, whichever is longer.
If more than
one Licensed Patent covers a Licensed Product, no additional
royalties will be paid by Company than if such Licensed Product
were covered by only one Licensed Patent.
If, after review at any stage of
prosecution, all Claims in pending patent applications covering a
Licensed Product covered by a Claim of a Licensed Patent are deemed
unpatentable by Company's and ASRI's patent counsel, then the
royalty to ASRI under Section 2a(vi) hereof shall be reduced to one
percent (1%) of Net Sales on such Licensed
Product. Notwithstanding the foregoing, if a patent
subsequently issues from such applications, then the royalty due to
ASRI shall return to the original two percent (2%) of Net Sales on
such Licensed Product, beginning on the date of such
issue.
b. In consideration
of the right to sublicense to third parties granted under Section
2b, the Company shall pay to ASRI in lieu of royalties or Milestone
Payments as set forth herein, a percentage of Sublicense Revenue
received by the Company and/or its Affiliates from its Sublicensees
based upon the following schedule:
From therapeutic royalty included
in Sublicense Revenue:
20% with respect to a Sublicense entered into
before first animal efficacy study of the Licensed
Products;
15% with respect to a Sublicense entered into
after first animal efficacy study of the Licensed Products but
before the commencement of the first human clinical trial of the
Licensed Products; and
10% with respect to a Sublicense entered into
after the commencement of the first human clinical trial of the
Licensed Products.
From all other therapeutic Sublicense Revenue
other than royalty income included in Sublicense
Revenue:
10% with respect to a Sublicense entered
into before first animal efficacy study of the Licensed
Products;
7.5% with respect to a Sublicense entered
into after first animal efficacy study of the Licensed Products but
before the commencement of the first human clinical trial of the
Licensed Products; and
5% with respect to a Sublicense entered
into after the commencement of the first human clinical trial of
the Licensed Products.
From diagnostic royalty included
in Sublicense Revenue:
15% with respect to a Sublicense entered into
before the commencement of the first human diagnostic clinical
trial of the Licensed Pr
