Exhibit 10.2
THE CBR INSTITUTE FOR BIOMEDICAL RESEARCH, INC.
EXCLUSIVE LICENSE AGREEMENT
CBRI ID: CYT-EX-112806
Effective Date: January 1, 2007
In consideration of the mutual promises and covenants set forth
below, the
parties hereto agree as follows:
ARTICLE I
DEFINITIONS
As used in this Agreement, the following terms shall have the
following
meanings:
1.1 AFFILIATE: Any company, corporation, or business in which
LICENSEE owns or
controls at least fifty percent (50%) of the voting stock or other
ownership.
Unless otherwise specified, the term LICENSEE includes
AFFILIATES.
1.2 BIOLOGICAL MATERIALS: The materials supplied by CBRI
(identified in Appendix
A) together with any progeny, mutants, or derivatives thereof,
together with any
materials produced through use of the original materials or
purified from a
source material included in the original materials, either supplied
by CBRI or
created by LICENSEE.
1.3 FIELD: Field of use shall be limited to HIV disease
applications, explicitly
excluding targeted delivery of other drugs.
1.4 CBRI: The CBR Institute for Biomedical Research, Inc., a
nonprofit
Massachusetts corporation, having offices at the 800 Huntington
Avenue, Boston,
Massachusetts 02115.
1.5 LICENSE YEAR: The period from the Effective Date until the
first anniversary
thereof, together with any successive one-year period.
1.6 LICENSED PROCESSES: The processes utilizing BIOLOGICAL
MATERIALS or some
portion thereof.
1.7 LICENSED PRODUCTS: Products made or services provided in
accordance with or
by means of LICENSED PROCESSES or products made or services
provided utilizing
BIOLOGICAL MATERIALS or incorporating some portion of BIOLOGICAL
MATERIALS.
1.8 LICENSEE: Advanced Genetic Technologies, Inc., a corporation
organized under
the laws of Florida having its principal offices at 2109 E. Palm
Avenue, Tampa,
Florida 33605.
1.9 NET SALES: The amount billed, invoiced, or received (whichever
occurs first)
by LICENSEE or its sublicensees for sales, leases, or other
transfers of
LICENSED PRODUCTS, less:
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(a) customary trade, quantity or cash discounts and non-affiliated
brokers' or
agents' commissions actually allowed and taken:
(b) amounts repaid or credited by reason of rejection or
return:
(c) to the extent separately stated on purchase orders, invoices,
or other
documents of sale, taxes levied on and/or other governmental
charges made as to
production, sale, transpo11ation, delivery or use and paid by or on
behalf of
LICENSEE or sublicensees; and
(d) reasonable charges for delivery or transportation provided by
third parties,
if separately stated. NET SALES also includes the fair market value
of any
non-cash consideration received by LICENSEE or sublicensees for the
sale, lease,
or transfer of LICENSED PRODUCTS.
1.10 NON-COMMERCIAL RESEARCH PURPOSES: Use of BIOLOGICAL MATERIALS
for academic
research or other not-for-profit scholarly purposes which arc
undertaken at a
nonprofit or governmental institution that does not use the
BIOLOGICAL MATERIALS
in the production or manufacture of products for sale or the
performance of
services fix a fee.
1.11 NON-ROYALTY SUBLICENSE INCOME: Sublicense issue fees,
sublicense
maintenance fees, sublicense milestone payments, co-development or
co-marketing
arrangements, and similar non-royalty payments made by sublicensees
to LICENSEE
on account of sublicenses pursuant to this Agreement.
1.12 TERRITORY: Worldwide.
1.13 TERM: The period from the Effective Date of this agreement
until the later
of 20 years thereafter or the date of the last patent to expire
that is owned or
controlled by LICENSEE and whose claims cover, in whole or in part,
LICENSED
PROCESSES or LICENSED PRODUCTS. 1.14 The terms "Public Law 96-51T"
and "Public
Law 98-620" include all amendments to those statutes. 1.15 The
terms "sold" and
"sell" include, without limitation, leases, licenses, other
transfers and
similar transactions.
ARTICLE II
REPRESENTATIONS
2.1 CBRI has the authority to issue licenses fix BIOLOGICAL
MATERIALS.
2.2 CBRI is committed to the policy that ideas or creative works
produced at
CBRI should be used for the greatest possible public benefit and
believes that
every reasonable incentive should be provided for the prompt
introduction of
such ideas into public use, all in a manner consistent with the
public interest.
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2.3 LICENSEE is prepared and intends to diligently develop the
BIOLOGICAL
MATERIALS and to bring LICENSED PRODUCTS to market which are
subject to this
Agreement.
2.4 LICENSEE is desirous of obtaining the exclusive and
nonexclusive licenses
set forth below in the TERRITORY, and to manufacture, use and sell
in the
commercial market LICENSED PRODUCTS, and CBRI is desirous of
granting such
licenses to LICENSEE in accordance with the terms of this
Agreement. 2.5
LICENSEE anticipates that all of its issued and outstanding capital
stock will
be acquired by CytoDyn, Inc., a Colorado corporation (CYTODYN),
within thirty
(30) days of the Effective Date, whereupon CYTODYN, by virtue of
its status as
an AFFILIATE will become the LICENSEE.
ARTICLE III
GRANT OF RIGHTS
3.1 CBRI hereby grants to LICENSEE and LICENSEE accepts. subject to
the terms
and conditions hereof[ in the TERRITORY and in the FIELD:
(a) A nonexclusive commercial license to use BIOLOGICAL MATERIALS
Plasmid 8630
(encodes CD11a); and
(b) An exclusive commercial license to use BIOLOGICAL MATERIALS
monoclonal
antibodies TS1-18 and TS1-22 to make and have made, to use and have
used, to
sell and have sold LICENSED PRODUCTS, and to practice LICENSED
PROCESSES, for
the TERM of the Agreement. Such licenses shall include the right to
grant
sublicenses related to the Cytolin development program, subject to
CBRI's
approval, which approval shall not be unreasonably withheld.
3.2 The granting and exercise of this license is subject to the
following:
(a) CBRI's "Research and Technology Development Policy," dated
October 24.2004
and any amendments thereto; Public Law 96-517, Public Law 98-620;
and CBRI's
obligations under agreements with other sponsors of research
relating to the
BIOLOGICAL MATERIALS. Any right granted in this Agreement greater
than or
inconsistent with those permitted under Public Law 96-517, or
Public Law 98-620,
shall be deemed modified as shall be required to conform to the
provisions of
those statutes.
(b) CBRI reserves the right to make and use, and provide the
BIOLOGICAL
MATERIALS to others on a non-exclusive basis, and grant others
non-exclusive
licenses to make and use the BIOLOGICAL MATERIALS, all for
NON-COMMERCIAL
RESEARCH PURPOSES: and
(c) LICENSEE shall further provide in any sublicenses that such
sublicenses are
subject and subordinate to the terms and conditions of this
Agreement, except:
(i) the sublicensee may not further sublicense; and (ii) the rate
of royalty on
3
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NET SALES paid by the sublicensee to the LICENSEE. Copies of all
sublicense
agreements shall be provided promptly to CBRI.
(d) During the period of exclusivity of any portion of this license
in the
United States, LICENSEE shall cause any LICENSED PRODUCT produced
for sale in
the United States to be manufactured substantially in the United
States.
3.3 All rights reserved to the United States Government and others
under Public
Law 96-517, and Public Law 98-620, shall remain and shall in no way
be affected
by this Agreement.
ARTICLE IV
ROYALTIES
4.1 LICENSEE shall pay to CBRI a non-refundable, non-creditable
license fee in
the sum of fifteen thousand dollars ($15,000) upon execution of
this Agreement.
4.2 Royalties:
(a) LICENSEE shall pay to CBRI during the TERM of this Agreement a
royalty of
two percent (2%) of NET SALES by LICENSEE and sublicensees on
aggregate NET
SALES of up to $200 million per LICENSE YEAR, and a royalty of
three percent
(3%) of aggregate NET SALES by LICENSEE and sublicensees in excess
of$200
million per LICENSE YEAR.
(b) In the case of sublicenses. LICENSEE shall also pay to CBRI an
amount equal
to twenty-five percent (25%) of NON -ROYALTY SUBLICENSE INCOME.
(c) On sales between LICENSEE and its AFFILIATES or sublicensees
for resale, the
royalty shall be paid on the NET SALES of the AFFILIATE or
sublicensee, as the
case may be.
(d) Charitable Donation Exemption: Subject to CBRI"s written
approval, not to be
unreasonably withheld. both parties will agree to an exemption of
the payment of
royalties subject to this Licensing Agreement, when licensed
product is provided
as a charitable donation, to not-for profit organizations for use
within the
Continent of Africa. Organizations receiving donated LICENSED
PRODUCT will not
be required to pay tax for the product, nor will CBRI or LICENSEE
receive
royalties or other payments for licensed products provided.
4.3 No later than on the first anniversary of the Effective Date of
this
Agreement and on each anniversary thereafter of the Effective Date
of this
Agreement, until the first commercial sale of LICENSED PRODUCT.
LICENSEE shall
pay to CBRI the following non-refundable license maintenance
fees:
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Anniversary
Payment
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1st Anniversary
$2,500.00
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2nd Anniversary
$5,000.00
------------------------------------------- -------------
3rd Anniversary
$5,000.00
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4th Anniversary
$10,000.00
------------------------------------------- -------------
5th Anniversary
$10,000.00
------------------------------------------- -------------
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Each subsequent Anniversary
$10,000.00
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The foregoing license maintenance fees shall be non-creditable
against future
royalties, but license maintenance fees paid with respect to a
particular
LICENSE YEAR shall be creditable against any milestone payment set
forth below
which becomes due within that same LICENSE YEAR. LICENSEE has
elected to prepay,
as of the Effective Date, the license maintenance fees associated
with the 1st
through 7th Anniversary dates, and additional payments will
commence as
specified above on the 8th Anniversary until first commercial sale
of a LICENSED
PRODUCT.
4.4 LICENSEE shall pay to CBRI non-refundable and non-creditable
milestone fees
fix the first LICENSED PRODUCT. The milestone payments shall be as
follows:
------------------------------------------- -------------
Milestone
Payment
------------------------------------------- -------------
Initiation of Phase I clinical trial
$50,000
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Initiation of Phase II clinical trial
$100,000
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Initiation of Phase III clinical trial
$250,000
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U.S. FDA marketing approval
$750,000
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4.5 LICENSEE shall pay to CBRI the non-refundable minimum royalty
set forth
below upon the first Anniversary of first commercial sale of any
LICENSED
PRODUCT by LICENSEE, its AFFILIATES or sublicensees, and thereafter
annual
minimum royalty payments shall be paid in the amounts listed below
for each
LICENSED PRODUCT, but each such minimum royalty shall be fully
creditable
against actual royalties paid or payable in the same LICENSE
YEAR:
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Year
Payment
------------------------------------------- -------------
1st & 2nd Anniversary
$50,000.00
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3rd & 4th Anniversary
$60,000.00
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5th Anniversary
$70,000.00
------------------------------------------- -------------
6th and
each subsequent Anniversary
$200,000.00
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ARTICLE V
REPORTING
5.1 Prior to first commercial sale of the first LICENSED PRODUCT,
LICENSEE shall
provide to CBRL not later than sixty (60) days the expiration of
each LICENSE
YEAR, a written annual progress rep0l1 describing in reasonable
detail the
progress of LICENSEE or its sublicensees on research and
development, regulatory
approvals, manufacturing, sublicensing, marketing and sales during
the most
recent LICENSE YEAR, as well as its plans for the forthcoming
LICENSE YEAR,
5.2 LICENSEE shall report to CBRI the date of first commercial sale
of each
LICENSED PRODUCT in each country within thirty (30) days of
occurrence.
5.3 (a) Subsequent to first commercial sale of each LICENSED
PRODUCT, LICENSEE
shall provide CBRI a
