<PAGE>
Exhibit 10.1
Confidential Materials omitted and filed separately with the
Securities and Exchange Commission. Asterisks denote omissions.
LICENSE AGREEMENT
BY AND BETWEEN
BOSTON LIFE SCIENCES, INC.
AND
BIOAXONE THERAPEUTIC INC.
<PAGE>
TABLE OF CONTENTS
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Article I
Definitions..............................................................
1
Section 1.1
"AAA"...................................................
1
Section 1.2
"Affiliate".............................................
1
Section 1.3
"Agreement".............................................
1
Section 1.4
"BA"....................................................
1
Section 1.5
"BA
Indemnitee"......................................... 1
Section 1.6
"Bankruptcy
Code"....................................... 1
Section 1.7
"BLA"...................................................
2
Section 1.8
"BLSI"..................................................
2
Section 1.9
"BLSI
Indemnitee"....................................... 2
Section 1.10
"Calendar
Year"......................................... 2
Section 1.11
"Claim".................................................
2
Section 1.12
"Clinical
Product"...................................... 2
Section 1.13
"Combination
Product"................................... 2
Section 1.14
"Commercialization" or
"Commercialize".................. 2
Section 1.15
"Commercially
Reasonable Efforts"....................... 2
Section 1.16
"Compound"..............................................
2
Section 1.17
"Confidential
Information".............................. 2
Section 1.18
"Control" or
"Controlled" or "Controls"................. 3
Section 1.19
"Cover" or "Covering"
or "Covered"...................... 3
Section 1.20
"Develop" or
"Development".............................. 3
Section 1.21
"Development
Plan"...................................... 3
Section 1.22
"Diligence
Milestones".................................. 3
Section 1.23
"Effective
Date"........................................ 3
Section 1.24
"Field".................................................
3
Section 1.25
"GAAP"..................................................
3
Section 1.26
"IND"...................................................
3
Section 1.27
"Indemnified
Party"..................................... 3
Section 1.28
"Indemnifying
Party".................................... 3
Section 1.29
"Key European
Countries"................................ 3
Section 1.30
"Know-How"..............................................
3
Section 1.31
"Launch"................................................
4
Section 1.32
"Licensed Intellectual
Property"........................ 4
Section 1.33
"Licensed
Know-How"..................................... 4
Section 1.34
"Licensed Patent
Rights"................................ 4
Section 1.35
"Licensed
Product"...................................... 4
Section 1.36
"Licensed
Trademarks"................................... 4
Section 1.37
"Marketing
Approval".................................... 4
Section 1.38
"Master Cell
Bank"...................................... 4
Section 1.39
"Net
Sales"............................................. 4
Section 1.40
"Party".................................................
6
Section 1.41
"Patent
Rights"......................................... 6
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Section 1.42
"Person"................................................
6
Section 1.43
"Phase II Clinical
Trial"............................... 6
Section 1.44
"Phase III Clinical
Trial".............................. 6
Section 1.45
"Phase IV Clinical
Trial"............................... 6
Section 1.46
"Regulatory
Approval"................................... 6
Section 1.47
"Regulatory
Authority".................................. 7
Section 1.48
"Regulatory
Materials".................................. 7
Section 1.49 "Royalty Expiration
Date"............................... 7
Section 1.50
"Severed
Clause"........................................ 7
Section 1.51
"Territory".............................................
7
Section 1.52
"Third
Party"........................................... 7
Section 1.53
"University Restated
License Agreement"................. 7
Section 1.54
"Valid
Claim"........................................... 7
Article II
Grant of
License.........................................................
8
Section 2.1
License Grants;
Sublicensing............................ 8
Section 2.2
Retained
Rights......................................... 8
Section 2.3
Section 365(n)
of the Bankruptcy Code................... 8
Section 2.4
Fully Paid-Up
License................................... 8
Section 2.5
Trademark...............................................
9
Section 2.6
Limitation..............................................
9
Section 2.7
Waiver..................................................
9
Article III
Reports and
Diligence....................................................
9
Section 3.1
Responsibility
for Development and Commercialization.... 9
Section 3.2
Diligence...............................................
11
Section 3.3
Records.................................................
11
Section 3.4
Development
Reports..................................... 11
Section 3.5
Technology
Transfer..................................... 11
Section 3.6
Transfer of
Regulatory Materials........................ 12
Section 3.7
Transfer of
Clinical Product............................ 12
Section 3.8
Master Cell
Bank........................................ 12
Article IV
Financial
Provisions.....................................................
12
Section 4.1
License
Payment......................................... 12
Section 4.2
Milestone
Payments...................................... 13
Section 4.3
Royalties...............................................
13
Section 4.4
Duration of
Payments.................................... 13
Section 4.5
Minimum
Royalties....................................... 13
Section 4.6
Reports and
Accounting.................................. 14
Section 4.7
Currency and
Method of Payments......................... 14
Section 4.8
Late
Payments........................................... 15
</TABLE>
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TABLE OF CONTENTS (CONTINUED)
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Section 4.9
Payments to BA
Licensors................................ 15
Article V
Intellectual Property Protection and Related
Matters..................... 15
Section 5.1
Prosecution and
Maintenance of Licensed Patent Rights... 15
Section 5.2
Infringement by
a Third Party........................... 16
Section 5.3
Infringement of
Third Party's Rights.................... 17
Section 5.4
Maintenance of
Trademarks............................... 17
Article VI
Confidentiality..........................................................
17
Section 6.1
Confidential
Information................................ 17
Section 6.2
Employee,
Consultant and Advisor Obligations............ 18
Section 6.3
Term....................................................
18
Article VII
Representations and
Warranties........................................... 19
Section 7.1
Representations
of Authority............................ 19
Section 7.2
Consents................................................
19
Section 7.3
No
Conflict............................................. 19
Section 7.4
Employee,
Consultant and Advisor Obligations............ 19
Section 7.5
Intellectual
Property................................... 19
Section 7.6
No
Warranties........................................... 19
Article VIII
Term and
Termination.....................................................
19
Section 8.1
Term....................................................
19
Section 8.2
Breach of
Material Obligation by BLSI................... 20
Section 8.3
Default by
BA........................................... 20
Section 8.4
Insolvency..............................................
21
Section 8.5
Termination for
Failure to Launch....................... 21
Section 8.6
Post
Termination........................................ 22
Section 8.7
Survival................................................
23
Article IX
Dispute
Resolution.......................................................
23
Section 9.1
Alternative
Dispute Resolution.......................... 23
Section 9.2
No
Limitation........................................... 24
Article X
Miscellaneous
Provisions.................................................
24
Section 10.1
Indemnification and
Insurance........................... 24
Section 10.2
Governing
Law........................................... 25
Section 10.3
Assignment..............................................
26
Section 10.4
Entire Agreement;
Amendments............................ 26
Section 10.5
Notices.................................................
26
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Section 10.6
Force
Majeure........................................... 27
Section 10.7
Public
Announcements.................................... 27
Section 10.8
Independent
Contractors................................. 27
Section 10.9
Headings................................................
27
Section 10.10 No
Implied Waivers; Rights Cumulative................... 27
Section 10.11
Severability............................................
27
Section 10.12
Execution in Counterparts...............................
27
Section 10.13 No
Third Party Beneficiaries............................ 28
Section 10.14 No
Consequential Damages................................ 28
</TABLE>
Schedule 3.7 Clinical
Product
Exhibit A
Compounds
Exhibit B
Licensed Patent Rights
Exhibit C
Trademarks
Exhibit D
University Restated License Agreement
Exhibit E
Development Plan
Exhibit F
Annual Sales Forecast and Minimum Royalties
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<PAGE>
LICENSE AGREEMENT
This
license agreement (the "AGREEMENT"), dated as of this 28th day
of
December, 2006 (the "EFFECTIVE DATE"), is by and between Boston
Life Sciences,
Inc., a Delaware corporation ("BLSI"), and BioAxone Therapeutic
Inc., a Canadian
corporation ("BA").
INTRODUCTION
1.
BLSI is in the business of developing and marketing
pharmaceutical
products.
2.
BA owns or controls patents and know-how relating to the fusion
proteins, including without limitation the protein referred to as
BA-210 or
Cethrin(R).
3.
BLSI desires to obtain, and BA desires to grant to BLSI, an
exclusive
license to use such patents and know-how to Develop (as defined
below) the
Compounds (as defined below) and the Licensed Products (as defined
below) and an
exclusive license to Commercialize (as defined below) such Licensed
Products
under the Licensed Trademarks (as defined below) in the Territory
(as defined
below).
NOW,
THEREFORE, BLSI and BA agree as follows:
Article I
Definitions
When
used in this Agreement, each of the following terms shall have
the
meanings set forth in this Article I:
Section 1.1 "AAA" has the meaning set forth in Section 9.1.
Section 1.2 "Affiliate" means, with respect to a Party, any Person
that
controls, is controlled by, or is under common control with such
Party. For
purposes of this Section 1.2, "control" shall refer to (a) in the
case of a
Person that is a corporate entity, direct or indirect ownership of
more than
fifty percent (50%) of the stock or shares having the right to vote
for the
election of directors of such Person; and (b) in the case of a
Person that is
not a corporate entity, the possession, directly or indirectly, of
the power to
direct, or cause the direction of, the management or policies of
such Person,
whether through the ownership of voting securities, by contract or
otherwise.
Section 1.3 "Agreement" has the meaning set forth in the
preamble.
Section 1.4 "BA" has the meaning set forth in the preamble.
Section 1.5 "BA Indemnitee" has the meaning set forth in Section
10.1(a).
Section 1.6 "Bankruptcy Code" means 11 U.S.C. Sections 101-1330,
as
amended.
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Section 1.7 "BLA" means a biologics license application filed with
the FDA
and/or any other application required for the purpose of marketing
or selling or
using a therapeutic or prophylactic product to be filed with a
governmental
agency in a non-U.S. country or group of countries, including,
without
limitation, a product license application or marketing
authorization application
in the European Union.
Section 1.8 "BLSI" has the meaning set forth in the preamble.
Section 1.9 "BLSI Indemnitee" has the meaning set forth in Section
10.1(b).
Section 1.10."Calendar Year" means a period of twelve (12) months
in the
Gregorian calendar beginning on January 1 and ending on December
31.
Section 1.11. "Claim" has the meaning set forth in Section
10.1(a).
Section 1.12. "Clinical Product" means BA-210 formulated in a
buffer
solution and combined with an active or inactive ingredient or
excepient,
resulting in a dosage form that can be applied onto the dura mater
of the spinal
cord using a suitable device.
Section 1.13. "Combination Product" has the meaning set forth in
Section
1.39.
Section 1.14. "Commercialization" or "Commercialize" means any
activities
directed to producing, manufacturing, marketing, promoting,
pricing/reimbursement, distributing, importing or selling a
product.
Section 1.15. "Commercially Reasonable Efforts" means the
commitment of
resources and efforts in accordance with reasonable business,
legal, medical,
and scientific judgment that are consistent with the efforts,
resources and
judgment that a development stage biotechnology company of similar
size and
position of BLSI in the marketplace would use in Developing and
Commercializing
its other pharmaceutical products and compounds which are of
similar market
potential and at a similar stage in their life cycle, taking into
account
product labeling or anticipated labeling, market potential, past
performance (if
any), economic return potential, medical and clinical
considerations, the
regulatory environment, and competitive market conditions in the
therapeutic
area, including the global impact of regional marketing, launch and
pricing
decisions, all as measured by the facts and circumstances at the
time such
efforts are due; provided, however, that BLSI shall not be entitled
pursuant to
the foregoing to take into account the fact that it is or may be in
the future
Developing or Commercializing a product that competes with the
Licensed
Products.
Section 1.16. "Compound" means any fusion protein the composition
of matter
for which is owned or Controlled by BA or its Affiliates as of the
Effective
Date, including without limitation those proteins listed on Exhibit
A, and any
derivatives, metabolites, prodrugs, isomers or polymorphs
thereof.
Section 1.17. "Confidential Information" means any and all verbal,
written,
pictorially or electronically transmitted and/or machine reproduced
confidential
or proprietary information, including the Master Cell Bank,
supplied, provided
or disclosed or which will be supplied, provided or disclosed by
one Party to
the other prior to the Effective Date or under this
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<PAGE>
Agreement and such Confidential Information that may be generated
by BLSI during
the Development and the Commercialization.
Section 1.18. "Control" or "Controlled" or "Controls" means the
possession
by the applicable Party of the ability to grant a license or
sublicense, in each
case as provided for in this Agreement, without violating the terms
of any
agreement or other arrangement with any Third Party.
Section 1.19. "Cover" or "Covering" or "Covered" means, with
respect to a
product, that, but for a license granted to a Party under a Valid
Claim, the
Development or Commercialization of such product would infringe
such Valid
Claim.
Section 1.20. "Develop" or "Development" means research, discovery
and
preclinical and clinical drug development activities, including
without
limitation test method development and stability testing,
toxicology,
formulation, manufacturing process or method, quality
assurance/quality control
development, statistical analysis, clinical studies, regulatory
affairs, product
approval and registration or any other activity that may be
required by a
Regulatory Authority for the obtaining of the Regulatory Approval
of a Licensed
Product.
Section 1.21. "Development Plan" has the meaning set forth in
Section
3.1(b).
Section 1.22. "Diligence Milestones" has the meaning set forth in
Section
3.2.
Section 1.23. "Effective Date" has the meaning set forth in the
preamble.
Section 1.24. "Field" means the treatment of disease in humans.
Section 1.25. "GAAP" means United States generally accepted
accounting
principles.
Section 1.26. "IND" means an investigational new drug application
and/or
any other similar application to be filed with the US FDA a or
foreign
Regulatory Authority in a country or group of countries of the
Territory.
Section 1.27. "Indemnified Party" has the meaning set forth in
Section
10.1(c).
Section 1.28. "Indemnifying Party" has the meaning set forth in
Section
10.1(c).
Section 1.29. "Key European Countries" means German, France, Italy,
Spain
and the United Kingdom.
Section 1.30. "Know-How" means any technical, scientific and
business
information, including all biological, chemical, pharmacological,
toxicological,
clinical, and assay information, data, analyses, discoveries,
inventions,
methods, techniques, improvements, concepts, designs, processes,
formulae,
specifications and trade secrets, data, whether or not patentable,
including
documents (which shall include paper, notebooks, books, files,
ledgers, records,
tapes, discs, diskettes, CD-ROM and any other media on which the
foregoing
information can be stored) containing any of the foregoing
information.
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Section 1.31. "Launch" means, for each Licensed Product in each
country,
the first arm's-length sale to a Third Party for use or consumption
by the
public of such Licensed Product in such country after Regulatory
Approval of
such Licensed Product in such country. A Launch shall not include
any Licensed
Product sold for use in clinical trials (including Phase IV
Clinical Trials),
for research or for other non-commercial uses, or that is supplied
as part of a
compassionate use or similar program.
Section 1.32. "Licensed Intellectual Property" means the Licensed
Know-How,
the Master Cell Bank, the Licensed Trademarks and the Licensed
Patent Rights.
Section 1.33. "Licensed Know-How" means any Know-How that is owned
or
Controlled by BA or any Affiliate of BA and disclosed or required
to be
disclosed by BA or any Affiliate of BA to BLSI that is necessary,
used or useful
for the Development or Commercialization of any Compound or
Licensed Product.
Section 1.34. "Licensed Patent Rights" means all Patent Rights
owned or
Controlled by BA and its Affiliates as of the Effective Date and
during the term
of this Agreement that, but for this Agreement, would be infringed
by the
Development or Commercialization of a Compound or Licensed Product,
including
without limitation those Patent Rights listed on Exhibit B.
Section 1.35. "Licensed Product" means a pharmaceutical product
(whether
prescription or over-the-counter) for use in the Field containing a
Compound,
including without limitation a Combination Product.
Section 1.36. "Licensed Trademarks" means the trademarks listed in
Exhibit
C.
Section 1.37. "Marketing Approval" means Regulatory Approval
together with
any applicable governmental price and reimbursement approvals of
Regulatory
Authorities necessary for the Commercialization of a product in a
country or
territory.
Section 1.38. "Master Cell Bank" means the master cell bank
provided by BA
to BLSI that expresses the Compound.
Section 1.39. "Net Sales" means, with respect to a Licensed
Product, the
gross amounts billed by BLSI, its Affiliates and sublicensees in
respect of
sales of such Licensed Product by BLSI, its Affiliates and
sublicensees to Third
Parties, in each case less the following deductions:
(a) the total of ordinary and customary trade discounts earned
and
actually taken or granted;
(b) any statutory or contractual rebates paid to any governmental
or
any other public authority, agency or entity or to other health
maintenance
organizations;
(c) cash and quantity discounts actually allowed;
(d) allowances and adjustments actually credited or paid to
customers
for recalled, rejected, spoiled, damaged, outdated and/or returned
Licensed
Products;
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<PAGE>
(e) chargebacks and other amounts due from BLSI, its Affiliate or
its
sublicensee, as applicable, on sale to customers, or on sale by
customers to
Third Parties (including without limitation end users), or on
dispensing of the
Licensed Product;
(f) freight, insurance, transportation costs and handling
charges
identified by BLSI, its Affiliate or its sublicensee, as
applicable, in its
invoices to independent Third Parties;
(g) excise, sales and value added taxes included by BLSI, its
Affiliate or its sublicensee, as applicable, in its invoices to
independent
Third Parties;
(h) customs duties, tariffs, and other compulsory payments made
by
BLSI, its Affiliate or its sublicensee, as applicable, to national
provincial
and local government authorities; and
(i) amounts written off as uncollectible in accordance with the
accounting policies of BLSI, its Affiliate or its sublicensee, as
applicable.
Such amounts shall be determined from the books and records of BLSI
and its
Affiliates, maintained in accordance with generally accepted
accounting
principles, consistently applied.
In the event the Licensed Product is sold as part of a Combination
Product (as
defined below), the Net Sales from the Combination Product, for the
purposes of
determining royalty payments, shall be determined by multiplying
the Net Sales
(as determined above) of the Combination Product, during the
applicable royalty
reporting period, by the fraction, A/A+B, where A is the average
sale price of
the Licensed Product when sold separately in finished form and B is
the average
sale price of the other active ingredient(s) included in the
Combination Product
when sold separately in finished form, in each case during the
applicable
royalty reporting period or, if sales of both the Licensed Product
and the other
active ingredient(s) did not occur in such period, then in the most
recent
royalty reporting period in which sales of both occurred. In the
event that such
average sale price cannot be determined for both the Licensed
Product and all
other active ingredient(s) included in such Combination Product,
Net Sales for
the purposes of determining royalty payments shall be calculated by
multiplying
the Net Sales of the Combination Product by the fraction of C/C+D
where C is the
fair market value of the Licensed Product and D is the fair market
value of all
other active ingredient(s) included in the Combination Product. In
such event,
BLSI shall in good faith make a determination of the respective
fair market
values of the Licensed Product and all other active ingredient(s)
included in
the Combination Product, and shall notify BA of such determination
and provide
BA with data to support such determination. BA shall have the right
to review
such determination of fair market values and, if BA disagrees with
such
determination, to notify BLSI of such disagreement within sixty
(60) days after
BLSI notifies BA of such determination. If BA notifies BLSI that BA
disagrees
with such determination within such sixty (60) day period and if
thereafter the
Parties are unable to agree in good faith as to such respective
fair market
values, then such matter shall be resolved as provided in Article
IX. If BA does
not notify BLSI that BA disagrees with such determination within
such sixty (60)
day period, such determination shall be conclusive and binding on
the Parties.
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As used above, the term "Combination Product" means any
pharmaceutical product
that includes both (x) a Licensed Product and (y) other active
ingredient(s).
Section 1.40. "Party" means BLSI or BA; "Parties" means BLSI and
BA.
Section 1.41. "Patent Rights" means all patents and patent
applications
(including provisional patent applications and 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, registration patent, patent of addition, or inventor's
certificate based
on or directed to the same invention as any such patent, and all
patents and
patent applications anywhere in the world that at any time,
directly or
indirectly, claim priority from, support a claim of priority of or
contain
substantially identical disclosure as any of the foregoing.
Section 1.42. "Person" means any natural person or any
corporation,
company, partnership, joint venture, pool, syndicate, governmental
authority,
firm or other entity not listed herein.
Section 1.43. "Phase II Clinical Trial" means a controlled human
clinical
trial conducted in accordance with GCP, anywhere in the world, of a
product that
utilizes the pharmacokinetic and pharmacodynamic information
obtained from one
or more previous Phase I Clinical Trial(s) to assess clinical
efficacy of the
therapy; as well as to continue Phase I assessments in a larger
group of
volunteers and subjects to establish the optimal manner of use of
the product
(dose and dose regimen) prior to initiation of a Phase III Clinical
Trial.
Section 1.44. "Phase III Clinical Trial" means a controlled human
clinical
trial conducted in accordance with GCP, anywhere in the world, on
large subjects
group that is designed to establish that the product is safe and
efficacious in
a statistically significant form and optimum dosage, for its
intended use, and
to define warnings, precautions, and adverse reactions that are
associated with
such product in the dosage range to be prescribed, and to support
Regulatory
Approval of such product or label expansion of such product.
Section 1.45. "Phase IV Clinical Trial" means a controlled human
clinical
trial of a product conducted in accordance with GCP, or other test
or study of
the product, commenced after receipt of initial Regulatory Approval
for an
indication in a country that is conducted within the parameters of
the labeling
approved for the product. Phase IV Clinical Trials may include
clinical trials,
or other tests and studies, conducted in support of
pricing/reimbursement for an
initial Regulatory Approval, epidemiological studies, modeling
and
pharmacoeconomic studies, post-marketing surveillance studies,
health economics
studies, and investigator-sponsored clinical trials.
Section 1.46. "Regulatory Approval" means the approvals (excluding
any
applicable governmental price and reimbursement approvals),
licenses,
registrations or authorizations of
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Regulatory Authorities necessary for the Commercialization of a
product in a
country or territory.
Section 1.47. "Regulatory Authority" means a federal, national,
multinational, state, provincial or local regulatory authority,
court,
commission, administrative or other agency, department, bureau or
governmental
entity which regulates the Development or Commercialization of a
product in a
country.
Section 1.48. "Regulatory Materials" means the technical, medical
and
scientific registrations, authorizations and approvals (including,
without
limitation, approvals of BLAs or foreign equivalents, supplements
and
amendments, pre- and post- approvals, pricing and Third Party
reimbursement
approvals, and labeling approvals) of any Regulatory Authority
necessary for the
Development or Commercialization of a Licensed Product in a
regulatory
jurisdiction, together with all related correspondence to or from
any Regulatory
Authority and all documents referenced in the complete regulatory
chronology for
each BLA or foreign equivalent, including the Drug Master File (if
any), IND and
BLA, or foreign equivalents.
Section 1.49. "Royalty Expiration Date" has the meaning set forth
in
Section 2.4.
Section 1.50. "Severed Clause" has the meaning set forth in Section
10.11.
Section 1.51. "Territory"
means all countries of the world.
Section 1.52. "Third Party" means any Person or entity other than a
Party
or any of its Affiliates.
Section 1.53. "University Restated License Agreement" means the
Restated
Patent License Agreement and I.P Agreement agreed upon between
Universite de
Montreal ("UNIVERSITY") and BA on August 2nd, 2006 which agreement
is attached
hereto as Exhibit D.
Section 1.54. "Valid Claim" means any claim of (i) an issued
and
non-expired Patent Right within the Licensed Patent Rights or (ii)
an issued and
non-expired Patent Right of BLSI or any of its Affiliates that
Covers in whole
or in part a Licensed Product and is based on or arising from
exposure to the
Licensed Intellectual Property ("BLSI Improvement Patent"), in each
case which
has not been revoked, held unenforceable, non-patentable, or
invalid by a court
or governmental agency of competent jurisdiction, unappealed or
unappealable
within the time allowed for appeal, or has not been specifically
admitted by the
holder of the patent to be unenforceable, non-patentable, or
invalid through
reissue, disclaimer, or otherwise in writing. Notwithstanding the
foregoing, in
the event that payment by BLSI of a royalty on the Net Sales of
Licensed
Products Covered by a BLSI Improvement Patent and not also Covered
by a Licensed
Patent Right is held by a court or governmental agency of competent
jurisdiction
to be patent misuse or otherwise a violation of applicable law in a
proceeding
initiated by a Third Party, unappealed or unappealable within the
time allowed
for appeal, the claims of such BLSI Improvement Patents shall not
constitute
Valid Claims.
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Article II
Grant of License
Section 2.1 License Grants; Sublicensing.
(a) Licenses Granted to BLSI.
(i) Research and Development. Subject to the terms of this
Agreement, BA hereby grants BLSI an exclusive, royalty-free license
(with the
right to grant sublicenses in accordance with Section 2.1(b), under
Licensed
Intellectual Property to Develop the Compounds and Licensed
Products in the
Field in the Territory.
(ii) Commercialization. Subject to the terms of this Agreement,
BA hereby grants BLSI an exclusive, royalty-bearing license (with
the right to
grant sublicenses in accordance with Section 2.1(b)) under Licensed
Intellectual
Property to Commercialize Licensed Products in the Field in the
Territory.
(b) Sublicenses. BLSI may grant and authorize sublicenses under
the
license granted pursuant to Section 2.1(a) of this Agreement under
terms and
conditions that are not less stringent than those set forth herein.
Within
thirty (30) days of entering into any such sublicense, BLSI shall
provide BA
with a copy of the sublicense agreement, which copy may be redacted
to exclude
confidential financial information (except to the extent such
information
relates to the calculation of Net Sales, in which case such
information shall be
made available to BA). BLSI shall require BLSI's sublicensees to
comply with the
provisions of this Agreement as such provisions are applicable to
the exercise
by sublicensees of rights licensed to BLSI hereunder. BLSI hereby
guarantees,
and shall remain primarily liable for, the performance of its
permitted
sublicensees under this Agreement. Any such sublicenses by BLSI
shall include an
obligation for the sublicensee to account for and report its Net
Sales, and BLSI
shall pay to BA (or arrange for the sublicensee to pay to BA, with
BLSI
remaining responsible for any failure of the sublicensee to pay
amounts when due
under this Agreement) royalties on such Net Sales as if such Net
Sales of the
sublicensee were Net Sales of BLSI.
Section 2.2 Retained Rights. BA hereby reserves the right to
Develop the
Compounds and Licensed Products for the sole purpose of conducting
Development
activities in accordance with Section 3.1(d).
Section 2.3 Section 365(n) of the Bankruptcy Code. All rights and
licenses
granted under or pursuant to this Agreement are, and shall
otherwise be, deemed
to be, for purposes of Section 365(n) of the Bankruptcy Code,
licenses of rights
to "intellectual property" as defined under Section 101(35A) of the
Bankruptcy
Code. The Parties shall retain and may fully exercise all of their
respective
rights and elections under the Bankruptcy Code.
Section 2.4 Fully Paid-Up License. On a country-by-country and
Licensed
Product-by-Licensed Product basis, from and after the date of (1)
with respect
to those countries where there is a Valid Claim Covering a Licensed
Product, the
later of the expiration of the last-to-expire Valid Claim Covering
such Licensed
Product in such country or the date that is ten (10) years after
the Launch of
such Licensed Product in such country; or (2) with respect to those
countries
where there is no Valid Claim Covering a Licensed Product, the date
that is ten
(10)
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years after the Launch of such Licensed Product in such country (in
each case
such date referred to as the "ROYALTY EXPIRATION DATE" for such
Licensed Product
in such country), BLSI shall have a nonexclusive, fully paid,
irrevocable,
perpetual license in such country, with the right to grant
sublicenses, under
the Licensed Intellectual Property.
Section 2.5 Trademark. BLSI agrees to Commercialize any Licensed
Products
related to the BA-210 protein for the treatment of acute spinal
cord injury
solely under the trademark Cethrin(R). BLSI shall ensure that each
reference to
and use of the Cethrin(R) trademark by BLSI in any marketing
material related to
the BA-210 related Licensed Products is made in accordance with
applicable law
and is accompanied by an acknowledgement that the Cethrin(R)
trademark is a
trademark or registered trademark owned by BA and used by BLSI
under license.
Section 2.6 Limitation. BLSI hereby acknowledges and agrees that
all rights
granted to BLSI under this Agreement are subject to the terms,
conditions,
limitations and obligations of BA set forth in the University
Restated License
Agreement. Furthermore, the Parties agree that should there be any
inconsistency
between this Agreement and the University Restated License
Agreement, the terms
and conditions of the University Restated License Agreement shall
prevail.
Section 2.7 Waiver. BLSI hereby acknowledges and agrees that
shortly after
the Effective Date, BA will terminate all of its employees.
Accordingly, BLSI
acknowledges that notwithstanding any provisions contained herein,
BA shall have
no obligation to support or provide assistance to BLSI in the
Development or
Commercialization of a Compound or Licensed Product, provided that
BA or its
designee or successor shall fulfill its obligations under Section
3.1(d),
Section 3.1(f), Section 3.5, Section 3.6 and Section 3.7 regardless
of BA's
then-current staffing or operational capacity.
Article III
Reports and Diligence
Section 3.1 Responsibility for Development and
Commercialization.
(a) Generally. During the term of this Agreement, except as
provided
in Section 3.1(d) below, BLSI (or its Affiliates or sublicensees)
shall have
sole authority to conduct Development and Commercialization
activities,
including all regulatory activities, with respect to any Compounds
and/or
Licensed Products throughout the Territory in accordance with the
Development
Plan. All regulatory submissions made after the Effective Date with
respect to
the Licensed Products in the Territory shall be owned by BLSI
and/or its
Affiliates or sublicensee(s), as applicable. Upon BLSI's reasonable
written
request and subject to Section 2.7, (i) BA shall use commercially
reasonable
efforts pursuant to Section 3.5 to provide BLSI with any Licensed
Know-How that
is reasonably useful for BLSI to conduct the activities set forth
in this
Section 3.1(a); and (ii) BA, at BLSI cost and expense, shall make
reasonable
efforts to cooperate with BLSI in connection with regulatory
submissions related
to any Licensed Product.
(b) Development Plan. All Development activities performed under
this
Agreement shall be in accordance with the Development Plan set
forth on Exhibit
E (the "DEVELOPMENT PLAN"). Any amendment to the Development Plan
shall be by
written approval of both Parties.
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<PAGE>
(c) Joint Management Committee. Within thirty (30) days of the
Effective Date, the Parties shall establish a Joint Management
Committee to
oversee Development activities hereunder. The Joint Management
Committee will be
comprised of at least two (2) senior representatives from each of
BLSI and BA
and shall be chaired by one of the representatives from BLSI.
Either Party may
substitute in its sole discretion its designated members of the
Joint Management
Committee from time to time. The Joint Management Committee shall
operate by
consensus and in accordance with the Development Plan. Meetings of
the Joint
Management Committee shall be held monthly and shall alternate
between the
offices of BLSI and BA unless BLSI and BA otherwise agree. Meetings
may not
necessarily be face-to-face meetings, but upon the agreement of the
Parties may
be via other methods of communication such as teleconferences
and/or
videoconferences. Each Party shall bear its own costs associated
with its
participation on the Joint Management Committee, including all
travel and living
expenses. Upon BLSI's payment to BA of the license fee set forth in
Section
4.1(b), the Joint Management Committee shall dissolve and
thereafter BLSI shall
be solely responsible for Development activities, subject to the
Development
Plan.
(d) BA Transitional Development Activities. During the period from
the
Effective Date through the date on which BLSI pays to BA the
license fee as set
forth in Section 4.1(b) (the "TRANSITION PERIOD"), BA shall manage
Development
of Compounds and/or Licensed Products in accordance with the
Development Plan
and under the guidance of the Joint Management Committee.
(e) Development Costs. During the term of this Agreement,
including
the Transition Period, BLSI shall be responsible for all costs
related to the
Development of Compounds and/or Licensed Products. Accordingly,
BLSI hereby
agrees to promptly reimburse BA for all costs and expenses incurred
by BA
related to the Development of Compounds and/or Licensed Products
during the
Transition Period.
(f) Regulatory Matters During Transition Period. During the
Transition
Period, and subject to the provisions of this Section 3.1(f), BA
will be solely
responsible for maintaining, at BLSI's cost and expense, the
Regulatory
Materials for BA-210 or Cethrin(R) and Compounds and Licensed
Products
containing BA-210 or Cethrin(R), including but not limited to the
IND therfor
and any foreign equivalents. Upon request by BA, BLSI shall assist
BA in
maintaining the IND. Prior to the transfer set forth in Section
3.6, BA will be
the sole owner of the IND. During the Transition Period, BA shall
be responsible
for all communications with the FDA and other Regulatory
Authorities related to
Compounds and/or Licensed Products in the Territory.
Notwithstanding the
forgoing, BA will not (i) file any document with the FDA or any
other Regulatory
Authority relating to Compounds or Licensed Products without the
prior consent
of BLSI or (ii) attend any meetings with a Regulatory Authority
related to
Compounds or Licensed Products at which a representative of BLSI
will not be
present, unless otherwise agreed by BLSI. If contacted by the FDA
or any other
Regulatory Authority regarding any matter related to a Compound or
Licensed
Product, BA shall inform BLSI of such contact as soon as
practicable, and shall
use commercially reasonable efforts to postpone any discussions
with such
Regulatory Authority regarding such matters until such time as BLSI
is available
to participate.
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<PAGE>
Section 3.2 Diligence. BLSI shall use Commercially Reasonable
Efforts to
Develop and Commercialize at least one Licensed Product in the
Territory during
the term of this Agreement in accordance with the Development Plan;
provided
that BLSI may satisfy such obligation, subject to the terms of this
Agreement,
by sublicensing the Development and Commercialization of a Compound
or Licensed
Product to a sublicensee that shall be obligated to adhere to the
Commercially
Reasonable Efforts obligations in this Agreement. BLSI shall be
deemed to have
satisfied its diligence obligations under this Section 3.2 with
respect to a
Compound or Licensed Product so long as BLSI has met the milestones
for
Development and Commercialization set forth in Section II of the
Development
Plan ("DILIGENCE MILESTONES") on or before the Outside Completion
Date. BLSI
shall be deemed to have failed its diligence obligations under this
Section 3.2
should BLSI fail to meet any Diligence Milestone on or before the
Outside
Completion Date, except to the extent such failure is caused by (i)
demonstrated
toxicity or drug safety issues with the Compounds and/or Licensed
Products
determined in accordance with industry standards or (ii) a failure
to
demonstrate statistically significant efficacy of the Compounds
and/or Licensed
Products in a well-designed, well-controlled clinical trial as
measured by
appropriate industry standards.
Section 3.3 Records. BLSI shall maintain complete and accurate
records of
all Regulatory Materials and material related to Development
and
Commercialization conducted by it or on its behalf related to each
Compound and
Licensed Product, and all material information generated by it or
on its behalf
in connection with Development and Commercialization under this
Agreement with
respect to each Compound and Licensed Product. BLSI shall, unless
otherwise
required by any applicable law or regulation, maintain such records
at least
until the later of: (a) [**] years after such records are created,
or (b) [**]
years after either the Launch of the Licensed Product to which such
records
pertain or the abandonment of Development of the Compound or
Licensed Product to
which such records pertain.
Section 3.4 Development Reports. Within [**] days after June 30
and
December 31 of each Calendar Year ending prior to the first Launch
of a Licensed
Product by BLSI, a BLSI Affiliate or a BLSI sublicensee, BLSI shall
provide to
BA a written report (a) summarizing the activities undertaken by
BLSI, its
Affiliates and sublicensees during the immediately preceding
Calendar Year in
connection with the Development of Compounds and Licensed Products,
including
progress toward the development activities outlined in Section I of
the
Development Plan; (b) identifying any Development Plan activities
BLSI, its
Affiliates and sublicensees anticipate will not be met by within at
least [**]
months of the Target Completion Date set forth in the Development
Plan; (c)
identifying the Compounds and Licensed Products being Developed by
BLSI, its
Affiliates and sublicensees, including Compounds that are being
clinically
developed or that BLSI, its Affiliates and sublicensees have
identified as lead
compounds for which future clinical development is reasonably
likely; and (d)
describing the Development activities planned to be undertaken by
BLSI, its
Affiliates and sublicensees during the then current Calendar Year.
Furthermore,
BLSI shall promptly provide written notice of any significant
positive or
negative event related to the Development of Compounds and Licensed
Products.
Section 3.5 Technology Transfer. During the Transition Period, BA
shall
provide BLSI with full access to the Licensed Know-How including
Regulatory
Materials as necessary to carry out Development activities under
the Development
Plan, including access (by
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teleconference or in person at BA's facilities or the facilities of
any Third
Party manufacturer involved in the manufacture of Compounds or
Licensed
Products) to BA personnel directly involved in the manufacture of
Compounds or
Licensed Products for reasonable consultation on the Licensed
Know-How and the
manufacturing processes for any Compounds or Licensed Products.
Promptly after
the completion of the Transition Period, BA shall use commercially
reasonable
efforts to transfer to BLSI the Licensed Know-How, including
without limitation
the Master Cell Bank, which Master Cell Bank BLSI shall maintain
during the term
of this Agreement in accordance with generally accepted industry
standards for
the same kind of proprietary material. Thereafter during the term
of this
Agreement, BA or its designee or successor shall provide BLSI with
any
additional Licensed Know-How that BA comes to own or Control after
the Effective
Date upon the request of BLSI.
Section 3.6 Transfer of Regulatory Materials. Subject to and upon
BLSI's
payment to BA of the license fee set forth in Section 4.1(b), BA
hereby agrees
to assign to BLSI BA's rights in any Regulatory Materials for
BA-210 or
Cethrin(R) and Compounds and Licensed Products containing BA-210 or
Cethrin(R),
including but not limited to the IND therefore and any foreign
equivalents.
Thereafter, BLSI or its sublicensees shall hold title to such IND
(and foreign
equivalents), and shall assume full responsibility for such IND
(and foreign
equivalents). In addition, BA promptly shall execute any and all
other
instruments, forms of assignment or other documents and take such
further
actions as BLSI may reasonably request in order to give effect to
or evidence
the foregoing assignment.
Section 3.7 Transfer of Clinical Product. Subject to and upon
BLSI's
payment to BA of the license fee set forth in Section 4.1(b), BA
shall transfer
its existing stock of Clinical Product, as more fully described in
Schedule 3.7
hereto and including all related assays and cell lines, to BLSI at
no cost. BLSI
shall be responsible at its costs and expenses to import and
receive any such
Clinical Product.
Section 3.8 Master Cell Bank. BLSI hereby acknowledges the
proprietary and
highly confidential nature of the Master Cell Bank. At all times
during the term
of this Agreement BLSI shall ensure that the Master Cell Bank (i)
is maintained
in accordance with applicable laws and generally prevailing
industry standards
and (ii) is not transferred or provided to any Third Party,
provided that BLSI
may (x) transfer the Master Cell Bank to a Third Party to store and
maintain the
Master Cell Bank on BLSI's behalf in accordance with this Section
3.8 and (y)
provide access to the Master Cell Bank to a Third Party
manufacturer solely for
the purpose of manufacturing the Licensed Product, and provided
further that
each such Third Party be under strict confidentiality
obligations.
Article IV
Financial Provisions
Section 4.1 License Payment. BLSI shall make a non-refundable
license
payment to BA of Ten Million Dollars ($10,000,000), payable as
follows:
(a) Two and a Half Million Dollars ($2,500,000) shall be paid
concurrently with the execution of this Agreement; and
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<PAGE>
(b) Seven and a Half Million Dollars ($7,500,000) shall be payable
on
or before March 31, 2007.
Section 4.2 Milestone Payments. BLSI shall make the following
non-refundable milestone payments to BA within [**] days after each
of the
following events:
<TABLE>
<CAPTION>
MILESTONE EVENTS
PAYMENT
----------------
-------
<S>
<C>
Completion of the first Phase III Clinical Trial of any Licensed
Product
$[**]
First Regulatory Approval of a Licensed Product in the United
States
$[**]
First Regulatory Approval of a Licensed Product in the European
Union
$[**]
First Regulatory Approval of a Licensed Product in Japan
$[**]
[**] days after the calendar month during which cumulative Net
Sales of
Licensed
Products reach [**]
$[**]
[**] days after the calendar month during which cumulative Net
Sales of
Licensed
Products reach [**]
$[**]
</TABLE>
The milestone payments payable pursuant to this Section 4.2 shall
each only be
payable one time, irrespective of how many Licensed Products BLSI,
its
Affiliates and sublicensees Develop or Commercialize.
Section 4.3 Royalties. BLSI shall pay BA royalties on Calendar Year
Net
Sales in the Territory at the royalty rates stated below.
(a) [**] percent ([**]%) of such Net Sales in any Calendar Year
that
are less than or equal to [**] Dollars ($[**]); and
(b) [**] percent ([**]%) of such Net Sales in any Calendar Year
that
are greater than [**] Dollars ($[**]).
Notwithstanding the foregoing, with respect to Net Sales in any
country where
there is no Valid Claim Covering the Licensed Product sold, BLSI
shall pay BA
royalties of [**] percent ([**]%) of such Net Sales in lieu of the
royalty rates
set forth above. The obligation to pay royalties is imposed only
once with
respect to Net Sales of the same unit of a Licensed Product.
Section 4.4 Duration of Payments. The amounts payable under Section
4.3
shall be paid on a Licensed Product-by-Licensed Product and
country-by-country
basis until the Royalty Expiration Date applicable to each Licensed
Product in
each country.
Section 4.5 Minimum Royalties. Exhibit F attached hereto and
incorporated
herein by reference sets out, for the first [**] years after
Marketing Approval
of the Licensed Product in the United States and one of the Key
European
Countries, the minimum royalties to be paid to BA during such [**]
years
("MINIMUM ROYALTIES"). For [**] years thereafter (or until the
expiration of the
last-to-expire Valid Claim of a Patent Right owned or Controlled by
BA Covering
the Licensed Product, if earlier, in which case the Minimum Royalty
shall be pro
rated for the Calendar Year in which such expiration occurs),
Minimum Royalties
shall be [**] Dollars ($[**]) annually on a world-wide basis. In
the event that
royalty payments under Section 4.3 for a Calendar Year for which
Minimum
Royalties are owed fall below the Minimum Royalty
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<PAGE>
amounts for territories in which a Licensed Product has obtained
Marketing
Approval, BLSI shall remit to BA the amount of the shortfall within
[**] days of
the end of such Calendar Year. If Marketing Approval of the first
Licensed
Product in a territory occurs during the first six (6) months of a
Calendar
Year, then the payable Minimum Royalty for such territory for the
first Calendar
Year shall be pro-rated in accordance with the number of days
remaining in such
Calendar Year. If Marketing Approval of the first Licensed Product
in a
territory occurs during the last six (6) months of a Calendar Year,
then the
Minimum Royalty for such territory for the first Calendar Year
shall be shifted
one year forward and no Minimum Royalty shall be due for that first
Calendar
Year. Minimum Royalties for the United States and the Key European
Countries
shall be due for only the first ten (10) Calendar Years after the
first
Marketing Approval of the first Licensed Product in either the
United States or
one of the Key European Countries (or until the expiration of the
last-to-expire
Valid Claim of a Patent Right owned or Controlled by BA Covering
the Licensed
Product, if earlier), but shall be due irrespective of whether or
when a Launch
of the Licensed Product occurs in the described territories.
Section 4.6 Reports and Accounting.
(a) Reports; Payments. BLSI shall deliver to BA, within [**]
days
after the end of each calendar quarter, reasonably detailed written
accountings
of Net Sales of the Licensed Product that are subject to payment
obligations to
BA for such calendar quarter. Such quarterly reports shall indicate
(i) gross
sales and Net Sales on a Licensed Product-by-Licensed Product
and
country-by-country basis; (ii) details relating to the calculation
of deductions
made pursuant to Section 1.39; and (ii) details relating to the
calculation of
payment amounts owed to BA from such gross sales and Net Sales.
When BLSI
delivers such accounting to BA, BLSI shall also deliver all amounts
due under
Section 4.3 to BA for the calendar quarter.
(b) Audits by BA. BLSI shall keep, and shall require its
Affiliates
and sublicensees to keep, in accordance with GAAP consistently
applied, records
of the latest five (5) years relating to gross sales and Net Sales.
For the sole
purpose of verifying amounts payable to BA, BA shall have the right
no more than
once each Calendar Year, at BA's expense, to review, together with
BA's
accountants, such records in the location(s) where such records are
maintained
by BLSI and its Affiliates and sublicensees upon reasonable notice
and during
regular business hours. Results of such review shall be made
available to BLSI.
If the review reflects an underpayment to BA, such underpayment
shall be
promptly remitted to BA, together with interest calculated in the
manner
provided in Section 4.8. If the underpayment is equal to or greater
than five
percent (5%) of the amount that was otherwise due, BA shall be
entitled to have
BLSI pay all of the costs of such review.
Section 4.7 Currency and Method of Payments. All payments under
this
Agreement shall be made in United States Dollars by wire transfer
to such bank
account as BA may designate in writing from time to time. Any
royalties due
hereunder with respect to amounts in currencies other than United
States dollars
shall be payable in their United States dollar equivalents,
calculated using the
average applicable interbank transfer rate determined by reference
to the
currency trading rates published by The Wall Street Journal
(Eastern U.S.
edition) over all business days of the calendar quarter to which
the report
under Section 4.6(a) relates.
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Section 4.8 Late Payments. BLSI shall pay interest to BA on the
aggregate
amount of any payment that is not paid on or before the date such
payment is due
under this Agreement at a rate per annum equal to the prime rate of
interest of
Citibank, NA as announced on the date such payment is due plus two
percent (2%),
or at the maximum rate permitted by applicable law, whichever is
lower, for the
period during which such payment remains overdue.
Section 4.9 Payments to BA Licensors. BA shall remain solely
responsible
and liable for any and all fees and payments owing to any Third
Party from whom
BA licenses Licensed Intellectual Property, including without
limitation the
University, arising as a result of this Agreement.
Article V
Intellectual Property Protection and Related Matters
Section 5.1 Prosecution and Maintenance of Licensed Patent
Rights.
(a) Right to Prosecute and Maintain. Subject to and upon BLSI's
payment to BA of the license fee set forth in Section 4.1(b), and
subject to the
rights of University under the University Restated License
Agreement, BLSI shall
have the first right and option to file and prosecute any patent
applications
and to maintain any patents included in the Licensed Patent Rights.
If BLSI
declines the option or fails to file and/or prosecute any such
patent
applications or maintain any such patents it shall give BA and the
University
reasonable notice to this effect, sufficiently in advance to permit
BA or the
University to undertake, BA or the University having the right but
not the
obligation, to pay all reasonable costs in order for such filing,
prosecution
and/or maintenance in order to maintain the said Licensed Patent
Rights. In the
event BA, or the University pursuant to the University Restated
License
Agreement, pays such costs for maintenance of the Licensed Patent
Rights, BLSI
agrees to reimburse BA, or the University on behalf of BA, as
applicable, for
same within ninety (90) days of receiving notice from BA or the
University
stating the maintenance fees related to the Licensed Patents have
been paid,
such reimbursements to be made in U.S. Dollars.
(b) Costs and Expenses. Beginning on the Effective Date of this
Agreement, BLSI shall (i) be responsible for the payment of all
maintenance and
other fees relating to the filing, prosecution, and maintenance of
the Licensed
Patents Rights; and (ii) on behalf of BA, provide the University
with copies of
correspondences evidencing such payments. BLSI shall be entitled to
deduct from
its payment obligations under Section 4.2 and Section 4.3 any such
costs and
expenses incurred by BLSI pursuant to Section 5.1(a) in preparing,
filing,
prosecuting and maintaining Licensed Patent Rights.
(c) Cooperation. Each Party agrees to cooperate with the other
with
respect to the filing, prosecution and maintenance of patents and
patent
applications pursuant to this Section 5.1. In furtherance of the
foregoing, BA
shall use commercially reasonable efforts under the circumstances
(which efforts
may include without limitation the exercise of all contractual
rights and
remedies available to BA under the University Restated License
Agreement) to
cause the University (subject to any limitations set forth in the
University
Restated License Agreement) to cooperate with BLSI as follows:
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<PAGE>
(i) the execution of all such documents and instruments and the
performance of such acts as may be reasonably necessary in order to
permit the
other Party to file, prosecute or maintain patents and patent
applications as
provided for in Section 5.1(a);
(ii) making its employees, agents and consultants reasonably
available to the other Party (or to the other Party's authorized
attorneys,
agents or representatives), to the extent reasonably necessary to
enable the
prosecuting Party to file, prosecute or maintain patents and patent
applications
as provided for in Section 5.1(a); and
(iii) to provide the other Party with copies of all material
correspondence with the United States Patent and Trademark Office
or its foreign
counterparts pertaining to the filing, prosecution or maintenance
of patents and
patent applications as provided for in Section 5.1(a).
Section 5.2 Infringement by a Third Party.
(a) Should either Party become aware of any infringement or
potential
infringement of the Licensed Patents Rights, they shall give the
other written
notice detailing the facts concerning such infringement or
potential
infringement.
(b) In the event of infringement or potential infringement of
the
Licensed Patent Rights, BLSI shall have the first right, within six
(6) months
of receiving notice, to either: (i) take the appropriate steps to
stop the
infringement; (ii) file suit against the infringer; or (iii)
provide BA (or the
University on behalf of BA) with reasonable evidence showing that
the infringer
intends to enter into a settlement agreement in which future
infringement will
be halted and any damages, profits or awards which might be
obtained shall be
recovered by BLSI for its own and sole benefit, subject to Section
5.2(d).
Should BLSI decide not to enforce the Licensed Patent Rights
against such
infringement, it shall so advise BA (or the University on behalf of
BA) in
writing, the said writing stating why BLSI has made, in its sole
discretion,
such a decision, and BA (or the University if the University elects
to exercise
its rights under the University Restricted License Agreement) shall
have the
right, at its own expense, to bring any action it deems necessary
to stop the
infringement and recover any damages, profits, and awards which
might be
obtained, subject to Section 5.2(d).
(c) During the term of this Agreement, BLSI at its own expense,
shall
be deemed to have the right, as authorized pursuant to the
appropriate statutes:
(i) to bring suit in its own name or, if required by law, BA and/or
the
University in which case BA grants and shall use commercially
reasonable efforts
under the circumstances (which efforts may include without
limitation the
exercise of all contractual rights and remedies available to BA
under the
University Restated License Agreement) to cause the University to
grant, if
necessary, a full power of attorney to BLSI, at BLSI's expense and
on its own
behalf for infringement of the Licensed Patents Rights; (ii) in any
such suit,
to enjoin infringement, and for infringing the Licensed Patents
Rights, to
collect damages, profits, and awards of whatever nature recoverable
for such
infringement for its own and sole benefit; and (iii) to settle any
claim or suit
for infringement of the Licensed Patents Rights by granting the
infringing Party
a sub-license as authorized by this Agreement.
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<PAGE>
(d) In the event either Party takes action under this Section 5.2,
the
other Party shall cooperate (and in the case of an action taken by
BLSI, BA
shall use commercially reasonable efforts under the circumstances
(which efforts
may include without limitation the exercise of all contractual
rights and
remedies available to BA under the University Restated License
Agreement) to
cause the University to cooperate) with the Party so acting to the
extent
reasonably possible, including joining the suit if necessary or
desirable. Any
recovery obtained by any Party as a result of any proceeding
described in this
Section 5.2, by settlement or otherwise, shall be applied first to
reimburse
each Party for all litigation costs in connection with such
proceeding paid by
that Party and not otherwise recovered (on a pro rata basis based
on each
Party's respective litigation costs, to the extent the recovery was
less than
all such litigation costs).
Section 5.3 Infringement of Third Party's Rights. Without prejudice
to any
other right they may have, should a claim that the Licensed
Products (as it
relates to the Licensed Patents Rights) or any material part
thereof, infringe a
Third Party's intellectual property rights be threatened or made
against BA,
BLSI, or any party receiving rights to the Licensed Patents Rights
through BLSI,
each of BA and BLSI agree that it shall give the other Party prompt
written
notice detailing as many facts as possible concerning such claim
and shall
cooperate fully with the other in the defense of such claim. The
reasonable
expenses incurred by BLSI, in the defense of such claim, shall be
first deducted
from any royalty owing and then any balance shall be held in trust
by BLSI until
such time that the potential infringement case is terminated or
settled and BA
shall only have a right to such royalties held in trust if the
Third Party
claiming is unsuccessful in obtaining a judgment against BLSI or
any of its
sublicensees. If the Third Party claiming the infringement is
successful in
obtaining a judgment against BLSI or any of its Sublicensees or if
the Parties
agree (BLSI acting reasonably) to amicably settle the matter, any
amount held in
trust and any future royalty shall first serve to pay the Third
Party 's
indemnity or damages awarded pursuant to a judgment of a court of
competent
jurisdiction or pursuant to any settlement, including any Third
Party license
fees occurring as a result of a judgment or settlement requiring
that BLSI or
any of its sublicensees obtain a license from the Third Party, and
the balance,
if any, shall be payable to BA pursuant to the provisions of
Article IV.
Section 5.4 Maintenance of Trademarks. Subject to and upon BLSI's
payment
to BA of the license fee set forth in Section 4.1(b), and subject
to the
provisions of Section 2.5, BLSI shall have the first right and
option to file
and maintain any trademarks included in the Licensed Trademarks. If
BLSI
declines the option or fails to file and/or maintain any such
trademark it shall
give BA reasonable notice to this effect, sufficiently in advance
to permit BA
to undertake, BA having the right but not the obligation, to pay
all reasonable
costs in order for such filing and/or maintenance in order to
maintain the said
Licensed Trademark. Beginning on the Effective Date of this
Agreement, BLSI
shall reimburse BA for all maintenance and other fees BA incurs
with respect to
the Licensed Trademarks within ninety (90) days of receiving
evidence from BA
that such fees have been paid by BA.
Article VI
Confidentiality
Section 6.1 Confidential Information. Each Party shall keep in
confidence
Confidential Information of the other Party. The Party receiving
such
information agrees not to
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reproduce or disclose same to any Third Party or to use it for any
purpose not
authorized in writing by the disclosing Party (except to the extent
reasonably
necessary for Regulatory Approval of Licensed Products, for the
filing,
prosecution and maintenance of Patent Rights or to Develop and
Commercialize
Licensed Products in accordance with this Agreement). The receiving
Party agrees
to hold the disclosing Party's information in confidence and to
protect it with
the same degree of care used in protecting its own information of
same
importance and in any case with not less than reasonable care and
shall not
otherwise be disclosed by the receiving Party to any other Person
(except
consultants, advisors and Affiliates in accordance with Section
6.2), without
the prior written consent of the disclosing Party, except to the
extent that the
Confidential Information:
(a) was known or used by the receiving Party prior to its date
of
disclosure to the receiving Party; or
(b) either before or after the date of the disclosure to the
receiving
Party is lawfully disclosed to the receiving Party by sources other
than the
disclosing Party rightfully in possession of the Confidential
Information; or
(c) either before or after the date of the disclosure to the
receiving
Party becomes published or generally known to the public through no
fault or
omission on the part of the receiving Party; or
(d) as evidenced by written records, is independently developed by
or
for the receiving Party without reference to or reliance upon the
Confidential
Information.
Notwithstanding the foregoing, the receiving Party shall be
entitled to
disclose the Confidential Information that is, in the receiving
Party's
reasonable judgment after consultation with counsel (which
