LICENSE
AGREEMENT (this “License”)
August 21, 2008 (the “Effective Date”)
Hamilton
Atlantic , a company
incorporated under the laws of the Cayman Islands, (Registration
No. 209852) and having its registered office at c/o The Harbour
Trust Co. Ltd., One Capital Place, PO Box 897, George Town, Grand
Cayman, KY1-1103, Cayman Islands, British West Indies (“
Hamilton ”);
Sunburst
Acquisitions III, Inc., a
Colorado corporation having its principal place of business at
10990 Wilshire Blvd., Suite 1410, Los Angeles, California, 90024,
United States of America (“ Sunburst
”)
(Hamilton and
Sunburst hereinafter to be collectively referred to as the
“Parties” and singularly as a
“Party”)
|
|
Hamilton is the
owner of the Hamilton IP (as defined below);
|
|
|
Sunburst is
willing to become the licensee of the Hamilton IP, on the terms and
conditions set out in this License.
|
|
|
On the
following terms and conditions, Hamilton has agreed to grant to
Sunburst an exclusive worldwide license to undertake further
research and development, and to market and sell products using the
Hamilton IP.
|
For and in
consideration of the foregoing premises and the mutual covenants
set forth herein and other valuable consideration;
|
|
THE PARTIES
AGREE as
follows:
|
|
1 .
|
DEFINITIONS
AND INTERPRETATION
|
|
1.1
|
In this License
(including the Recitals), unless the context otherwise
requires:
|
Act means the Federal Food, Drug and Cosmetic Act,
21 U.S.C. §§ 301 et seq., as such may be amended from
time to time.
Affiliate means any corporation or other business entity,
which controls, is controlled by or is under common control with a
Party. For purposes of this definition, “control”
means, as of or subsequent to the Effective Date, direct or
indirect ownership of more than fifty percent (50%) of the
voting interest or income interest in a corporation or business
entity;
FDA means the United States Food and Drug
Administration;
|
|
Hamilton
IP means the Know-How and
Materials, and any and all worldwide intellectual property rights
including but not limited to, patents and patent applications set
out in Schedule A and Schedule B hereto which are held, as at the
Effective Date, in the name of Hamilton, VSL or Viragen, or in the
joint names of VSL and Viragen, together with any related pending
patent applications, issued patents, reissue patents, extensions,
substitutions, continuations, divisional applications, divisions,
continuation-in-part applications and supplementary protection
certificates in any part of the world which are based on the
Know-How and Materials, patents or patent applications set out in
Schedule A or Schedule B hereto;
|
|
|
Know-How and
Materials means the
laboratory note books, clinical trials and other research results,
cell lines, and other data, all as are set out in Schedule
B;
|
|
|
Licensed
Product means any item,
thing, method or process developed by Sunburst that falls within
the scope of a Hamilton IP or which contains or was developed using
Hamilton IP;
|
NDA means a New Drug Application (as described in 21
C.F.R. § 314.50 et. seq.) filed with the FDA for marketing
approval for a drug pursuant to the Act and the regulations
promulgated thereunder, including any amendments or supplements
thereto.
Net
Sales means the invoiced
amount actually received for sales of Licensed Products to a Third
Party trade purchaser (the “Customer”) by Sunburst or
its Affiliates, or, to the extent permitted in this License,
through Sublicenses, less the following items to the extent they
are paid or incurred or allowed and included in the invoice price:
(i) quantity, trade, and/or cash discounts or rebates actually
granted or accrued; (ii) amounts repaid or credited and allowances
including cash, credit or free goods allowances given by reason of
billing errors and rebates actually allowed or paid or accrued;
(iii) amounts refunded or credited for Licensed Products which were
rejected or damaged or recalled; and (iv) taxes, tariffs, customs
duties and surcharges and other governmental charges incurred in
connection with the sale, exportation or importation of Licensed
Products;
Party or Parties has the meaning set forth in
the Preamble above.
|
|
Product
Registration means, with
respect to a Licensed Product, a NDA approved by the FDA in the
United States or any other government approval required by a
government or regulatory authority of a country in the Territory
necessary to permit the marketing, import, use and sale of a
Licensed Product in such country. Product Registration shall
include governmental approval of pricing and/or reimbursement in
jurisdictions where such approval is required (either legally or
commercially) for commercial sale of a Licensed Product.
|
|
|
Sub-license means any agreement with a Third Party (the
“Sub-licensee”) in which Sunburst has granted
(i) the right to make or sell a Licensed Product in the
Territory, with respect to Licensed Products made and sold by such
Third Party or (ii) the right to distribute a Licensed Product
made by or for Sunburst in the Territory, provided that such Third
Party is responsible for the marketing and promotion of such
Licensed Product in the applicable territory and has the right to
record sales of such Licensed Product for its account.
|
|
|
Sub-license Fees means all gross consideration
(including upfront and milestone payments) other than royalty
payments that accrue to Sunburst under any Sub-license.
|
|
|
Territory means, with respect to each Licensed Product,
all countries of the world and their respective territories and
possessions.
|
|
|
Third
Party means any person or
entity other than Hamilton, Sunburst, or any of their
Affiliates.
|
|
1.2
|
Words denoting
the singular include the plural and vice versa, words denoting a
gender include all genders, and words denoting persons include
corporations and all other legal entities.
|
|
1.3
|
Unless the
context otherwise requires, references in this License to any
Clause will be deemed to be a reference to the relevant clause of
this License.
|
|
1.4
|
The headings
are inserted for ease of reference only and will not affect the
interpretation or construction of this License.
|
|
2.1
|
Hamilton hereby
grants Sunburst an exclusive right and license under all of its
rights in the Hamilton IP in the Territory to research, develop,
use, keep, make, have made, market, distribute, sell, offer to
sell, advertise or otherwise dispose of Licensed
Products.
|
|
2.2
|
The license
granted in Clause 2.1 shall, in relation to a particular country in
the Territory, terminate on the expiry of the relevant Hamilton IP
in the relevant country.
|
|
2.3
|
Sunburst shall
have the independent right to grant Sub-licenses of any or all of
the rights granted to it pursuant to Clause 2.1 to Third Parties or
Affiliates if, in respect of each Sub-license, Sunburst ensures
that Hamilton’s rights under this License are maintained and
that Sunburst meets the material terms and conditions of the
License. Sunburst shall also have the independent right
to enter into sub-contract manufacturing, co-marketing or
distribution agreements with Third Parties under which Sunburst
appoints such Third Party as its agent to manufacture, promote or
sell Licensed Products. Within thirty (30) business days
of the grant of any Sub-license to a Third Party, Sunburst shall
provide Hamilton with a true copy of the Sub-license signed by
Sunburst and such Third Party. Any Sub-license that is
granted in breach of this Clause 2.3 shall be void but shall not
otherwise affect this License.
|
|
3
|
COMMERCIAL
DEVELOPMENT AND PATENT RIGHTS
|
|
3.1
|
Sunburst shall,
and shall cause its Affiliates and Sub-licensees to, at its own
cost and expense, use their commercially reasonable efforts to: (i)
obtain all necessary and desirable Product Registrations, and (ii)
commercialize the Licensed Products in the Territory to the maximum
extent practicable and desirable.
|
|
3.2
|
Sunburst shall
independently undertake or procure the filing, prosecution, and
maintenance of the Hamilton IP, in the name of the patent holder,
and be responsible for any enforcement proceedings relating to them
(including any interference or opposition proceedings); provided,
however, that the Parties agree that Sunburst’s obligations
hereunder shall extend only as such undertakings relate to the
Licensed Products and Clause 3.1. Sunburst shall use
their independent judgment to determine which actions are desirable
for satisfaction of Clauses of 3.1 and 3.2 and is not required to
consult with or obtain consent from Hamilton with respect to these
actions.
|
|
3.3
|
Each Party
shall give the other immediate notice of any actual or suspected
infringement of the Hamilton IP or any actual or suspected misuse
or misapplication of the Hamilton IP by a Third Party which comes
to that Party’s attention during the term of this
License.
|
|
3.4
|
If either Party
receives any notice, claim, or proceedings from any Third Party
alleging infringement of that Third Party’s intellectual
property by reason of either Party’s activities in relation
to this License or the use and exploitation of the Hamilton IP, the
Party receiving that notice shall notify the other Party of the
notice, claim, or proceeding within three (3) business
days.
|
|
4.1
|
Sunburst shall
pay to Hamilton:
|
|
4.1.1
|
Royalties of
one percent of Net Sales of Licensed Products (“Direct
Royalties”).
|
|
4.1.2
|
Two percent of
all payments received by Sunburst through Sub-license Fees
(“Indirect Royalties”).
|
|
4.2
|
The Direct
Royalties and Indirect Royalties shall be paid quarterly in arrears
within thirty (30) business days at the end of the calendar quarter
in which relevant sales of Licensed Products
occur. Within thirty (30) business days of the end of
each calendar quarter, Sunburst shall provide to Hamilton a written
report detailing the sales of Licensed Products on a
country-by-country basis, if any, made by Sunburst and the
calculation of Net Sales and the royalty payable to Hamilton in
respect of such Net Sales together with any Sub-license
Fees.
|
|
4.3
|
Where Hamilton
does not receive payment of any sums due to it within thirty (30)
business days of the relevant date set out in Clause 4.2 (the
“Due Date”), interest shall accrue on the sum due and
owing to Hamilton at the rate equivalent to an annual rate of six
percent (6%), without prejudice to Hamilton’s right to
receive payment on the Due Date.
|
|
4.4
|
Sunburst shall
keep true and accurate records and books of account, and shall
require in its contracts with Sub-licensees that its Sub-licensees
shall keep true and accurate records and books of account,
containing all data necessary for the calculation of the amounts
payable by Sunburst to Hamilton pursuant to Clause
4.1. Such records and books of account shall be kept for
six (6) years following the end of the calendar year to which they
relate and Sunburst’s records and books of account shall,
upon reasonable notice having been given by Hamilton, be open at
reasonable times on business days for inspection by an independent
firm of accountants appointed by agreement between the
Parties.
|
|
5.1
|
Sunburst
represents and warrants that it has legal power, authority and
right to enter into this License and to perform its obligations
hereunder and this License is valid, binding and enforceable
against Sunburst in accordance with its terms.
|
|
5.2
|
Hamilton
represents and warrants that:
|
|
|
5.2.1 It is the sole owner of the
Hamilton IP existing as of the Effective Date and has all right,
title, claims, interest, and privilege arising from such ownership,
free and clear of any liens, security interests, encumbrances,
rights, or restrictions;
|
|
|
5.2.2 The Hamilton IP existing as of
the Effective Date and the subject matter of the Hamilton IP
existing as of the Effective Date (a) are not the product or
subject of any joint development activity or agreement
|
|
