1
EXHIBIT 10.19
CONFIDENTIAL TREATMENT REQUESTED UNDER 17 C.F.R. SECTIONS 200.80(b)(4), 200.83
AND 230.406 * INDICATES OMITTED MATERIAL THAT IS THE SUBJECT OF A CONFIDENTIAL
TREATMENT REQUEST THAT IS FILED SEPARATELY WITH THE COMMISSION
EXCLUSIVE LICENSE AGREEMENT
THIS EXCLUSIVE LICENSE AGREEMENT (the "AGREEMENT") is made and entered
into this 17th day of June, 1996 (the "EFFECTIVE DATE"), by and between
ALANEX CORPORATION, a California corporation having its principal place of
business at ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇ ("ALANEX"), and
the MOUNT SINAI SCHOOL OF MEDICINE OF THE CITY UNIVERSITY OF NEW YORK, a New
York corporation having its principal place of business at ▇▇▇ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ ("LICENSOR").
RECITALS:
WHEREAS, Alanex and Licensor have entered into a Research Agreement of
even date herewith (the "RESEARCH AGREEMENT"), under which Licensor shall
perform research directed toward the human GnRH receptor (the "RESEARCH
PROGRAM"); and
WHEREAS, Alanex and Licensor have also entered into a Nonexclusive
License Agreement of even date herewith, under which Alanex has obtained
nonexclusive rights to certain inventions and technologies relating to the human
GnRH receptor that Licensor owned as of the Effective Date; and
WHEREAS, Alanex desires to obtain an exclusive license under inventions
and technologies developed by Licensor in the course of Research Program; and
WHEREAS, Licensor is willing to grant such a license to Alanex in
accordance with the terms and conditions contained herein;
NOW, THEREFORE, Licensor and Alanex hereby agree as follows:
ARTICLE 1
DEFINITIONS
1.1 "AFFILIATE" means any entity that directly or indirectly owns, is
owned by or is under common ownership, with Alanex, where "owns" or "ownership"
means direct or indirect possession of at least 50% of the outstanding voting
securities of Alanex.
1.2 "LICENSED KNOW-HOW" means all know-how, technology, data,
processes, protocols, procedures, methods, formulas, compositions of matter,
materials (including biological materials, such as cell lines, vectors, reagents
or assays), information and other subject matter which is developed in the
course of the Research Program. Licensed Know-how shall include without
limitation the reporter system, transfected cell lines and mutant cell lines
described on Exhibit A to the Research Agreement, when provided to Alanex by
Licensor.
1.
2
1.3 "LICENSED PATENTS" means (i) all domestic patents and patent
applications (including provisional applications) covering inventions made in
the course of the Research Program, (ii) all patents issuing from such patent
applications, (iii) all divisionals, substitute applications, continuations and
continuations-in-part derived from such patent applications, (iv) all reissues,
renewals, re-examinations and inventors' certificates derived from such patents
and (v) all foreign counterparts of the foregoing.
1.4 "LICENSED PRODUCT" means any product discovered, developed or
manufactured by Alanex, its Affiliates or sublicensees using any Licensed
Know-how or any invention covered by a Licensed Patent.
1.5 "LICENSED TECHNOLOGIES" means the Licensed Patents and Licensed
Know-how.
1.6 "NET SALES" means the gross receipts received by Alanex, its
Affiliates or sublicensees, as appropriate, for the commercial sale of Licensed
Products to independent third parties, less the following: transportation
charges, discounts actually allowed (including distributor discounts), credits
allowed for defective or returned goods, and other allowances (actually paid or
allowed, including but not limited to, prompt payment and volume discounts,
charge backs from wholesalers and other allowances granted to the end commercial
customer of the Licensed Product, whether in cash or trade), costs of insurance
and sales and other taxes based on sales prices when included in gross sales,
but not including taxes assessed on income derived from such sales.
ARTICLE 2
TECHNOLOGY RIGHTS AND TRANSFER
2.1 LICENSE GRANT. Licensor hereby grants to Alanex an exclusive (even
as to Licensor), worldwide license under the Licensed Technologies to discover,
develop, manufacture, use, offer for sale, sell and import Licensed Products.
Licensor retains the right to practice the Licensed Technologies for
noncommercial academic and educational purposes. Alanex may grant sublicenses
under such rights, provided that Licensor approves the identity of any
sublicensee that is not a "Fortune 500" pharmaceutical company or on Fortune
Magazine's comparable international list. Licensor shall not unreasonably
withhold or delay any such approval.
Alanex acknowledges that the United States Government may retain
certain rights under 35 U.S.C. 200-212 with respect to the Licensed
Technologies. The license granted to Alanex hereunder is subject to such rights.
Alanex agrees to use its reasonable best efforts to cause Licensed Products to
be manufactured in the United States.
2.2 UPDATES OF LICENSED TECHNOLOGIES. As reasonably requested by
Alanex, the Principal Investigation and Licensor shall update Alanex as to
Licensed Patents and Licensed Know-how developed in the course of the Research
Program. Exhibit A shall be periodically updated by the parties to include all
such Licensed Patents and Licensed Know-how. Such list
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3
*CONFIDENTIAL TREATMENT REQUESTED
shall be maintained for convenience only. The definitions set forth in Sections
1.2 and 1.3 shall define the Licensed Know-how and Licensed Patents covered by
this Agreement at all times.
2.3 LICENSED PATENTS. Licensor shall notify Alanex of each new
patentable invention subject to this Agreement at least thirty (30) days in
advance of filing any patent application on such invention. If Alanex notifies
Licensor within such thirty (30) day period that Alanex will not be responsible
for reimbursement of patent costs related to such invention, then such patents
shall not be included within the Licensed Patents and shall not be subject to
the terms of this Agreement.
2.4 DISCLOSURE OF LICENSED KNOW-HOW. During the term of this Agreement,
Licensor shall use reasonable efforts to provide Alanex with all tangible and
intangible components of the Licensed Know-how.
ARTICLE 3
CONSIDERATION
3.1 PATENT COSTS. Alanex agrees to reimburse Licensor in accordance
with Section 4.1 for all documented costs incurred by Licensor in connection
with the filing, prosecution and maintenance of the Licensed Patents. Alanex
will reimburse Licensor within thirty (30) days of receipt of such
documentation.
3.2 MILESTONE PAYMENTS. Alanex agrees to pay to Mount Sinai an amount
equal to **************** of any milestone payments which Alanex may receive
from third party sublicensees upon the achievement of human clinical or
regulatory milestones with Licensed Products. License fees, equity investments,
bona fide loans, payments for research and development by Alanex and payments
other than the milestones described above shall not be subject to this Section
3.2. If Alanex receives consideration in a form other than cash, Alanex may pay
Licensor pursuant to this Section 3.2 either in kind or in cash based upon the
fair market value of such consideration.
3.3 ROYALTIES. Alanex agrees to pay Licensor during the term of this
Agreement a royalty equal to ************************** of Net Sales of
Licensed Products.
3.4 PAYMENTS; REPORTS. Payments made pursuant to Sections 3.2 and 3.3
above shall be payable in U.S. dollars. Payments made under Section 3.2 above
shall be made within thirty (30) days of Alanex' receipt of milestone payments
from its third party sublicensees. The first royalty payment under Section 3.3
shall cover all royalties due on Net Sales of Licensed Products during the
calendar quarter when such sales commence and shall be made forty-five (45) days
after the end of such quarter. Thereafter royalty payments shall be due
forty-five (45) days after each succeeding calendar quarter and shall cover the
royalties earned during such calendar quarter. Alanex agrees to provide written
reports to Licensor with such royalty payments setting forth the total number of
Licensed Products sold during the applicable period. In the event that Alanex is
required to withhold taxes imposed on such payments in any country, Alanex will
remit such taxes to the proper authorities, reduce payment to Licensor
accordingly
3.
4
and supply Licensor with all relevant documentation in Alanex's possession so
that Licensor may recover such taxes to the extent permissible.
3.5 RECORDS RETENTION. Alanex will keep, and will cause its Affiliates
and sublicensees to keep, complete and accurate records pertaining to the sale
of Licensed Products in sufficient detail to permit Licensor to confirm the
accuracy of calculations of all payments due hereunder. Such records will be
maintained for a three (3) year period following the year in which any such
payments were made hereunder.
3.6 AUDIT REQUEST. No more frequently than once a year, Licensor will
have the right to engage, at its own expense, an independent certified public
accountant reasonably acceptable to Alanex to examine Alanex's records to
determine, with respect to any calendar year, the correctness of any report or
payment made under this Agreement. Any such audit will be conducted under
reasonable confidentiality restrictions. In the event that any such examination
reveals that payments made to Licensor hereunder are incorrect by more than
seven percent (7%) in any audited period, Alanex shall reimburse Licensor for
the costs of such audit in addition to promptly remitting the amount of any
underpayment with interest at the prime rate reported in the Wall Street Journal
on the last day of the month prior to the date of such remittance.
ARTICLE 4
PATENTS AND INFRINGEMENT
4.1 PATENT PROSECUTION AND MAINTENANCE. Licensor shall have the right,
but not the obligation, to file, prosecute and maintain all patent applications
and patents included in the Licensed Patents using counsel reasonably acceptable
to Alanex. Licensor and Alanex shall cooperate to determine appropriate
prosecution strategy with respect to each Licensed Patent, including the
countries in which such patent will be pursued. Licensor will provide Alanex
with copies of all correspondence with patent authorities promptly after receipt
or delivery. Licensor will provide Alanex with a reasonable opportunity to
review and comment on all patent filings in advance of filing. Alanex shall
reimburse Licensor for all documented costs, fees and expenses incurred by
Licensor in connection with the filing, prosecution and maintenance of the
Licensed Patents. In the event Licensor declines to file, prosecute or maintain
any application or patent within the Licensed Patents in any country, Licensor
shall give Alanex notice of such decision reasonably in advance of any filing
deadline applicable to such application or patent. Thereafter, Alanex may, at
its own expense, continue to prosecute or maintain such application or patent.
4.2 PATENT ENFORCEMENT. Alanex shall have the first right, but not the
obligation, to enforce the Licensed Patents in infringement, interference or
other proceedings and to file suit in its own name or in the name of Licensor.
All costs, fees and/or expenses incurred in connection with such enforcement of
the Licensed Patents shall be borne by Alanex. To the extent that damages are
awarded to Alanex in any suit for infringement, such damages shall be applied
first to reimburse Alanex for its enforcement expenses and the remainder will be
treated as Net Sales of Alanex subject to royalties under Section 3.3. In the
event that Alanex declines
4.
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to prosecute infringement of any Licensed Patents pursuant to this Section 4.2,
Licensor shall have the right to prosecute such infringement at its own expense
and to retain any recovery obtained in such action.
4.3 ASSISTANCE. Licensor shall provide any assistance reasonably
requested by Alanex in exercising its rights under this Article 4, subject to
reimbursement of Licensor's out-of-pocket costs in providing such assistance.
Without limitation, to the extent possible Licensor will execute any documents
necessary for Alanex to bring suit to enforce the Licensed Patents and will make
employees and other personnel associated with Licensor reasonably available to
assist with patent prosecution or to give testimony relating to the Licensed
Patents.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES
5.1 DUE AUTHORIZATION. Each party represents and warrants that it is
duly authorized to execute and deliver this Agreement and to perform its
obligations hereunder.
5.2 BINDING AGREEMENT. Each party represents and warrants that this
Agreement is a legal and valid obligation binding upon it and enforceable in
accordance with its terms. The execution, delivery and performance of this
Agreement by such party does not conflict with any agreement, instrument or
understanding, oral or written, to which it is a party or by which it may be
bound, nor violate any law or regulation of any court, governmental body or
administrative or other agency having jurisdiction over it.
ARTICLE 6
TERM; TERMINATION
6.1 TERM. This Agreement will commence as of the Effective Date and,
unless sooner terminated as provided in this Article 6, will expire upon the
later of (a) ten (10) years from first commercial sale of any Licensed Product
or (b) the date of expiration of the last-to-expire patent included in the
Licensed Patents.
6.2 TERMINATION BY ALANEX. Alanex will have the right to terminate this
Agreement for any reason upon sixty (60) days prior written notice to Licensor.
In the event of material breach by Licensor, Alanex may elect to terminate this
Agreement upon sixty (60) days prior written notice or continue this Agreement
while pursuing its legal remedies, including the receipt of damages related to
such breach. Any damages finally awarded may, at Alanex's option, be deducted
from any payments owed to Licensor pursuant to Article 3 hereof.
6.3 TERMINATION BY LICENSOR. Licensor will have the right to terminate
this Agreement, in addition to pursuing any remedies available under law or in
equity, upon sixty (60) days written notice to Alanex if Alanex is in material
breach of this Agreement, unless
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6
within such sixty (60) day period Alanex initiates good faith efforts reasonably
calculated to cure such breach.
6.4 EFFECT OF TERMINATION; SURVIVAL. Upon any termination of this
Agreement, Alanex will pay Licensor all accrued payments due Licensor through
the expiration or termination date and all licenses shall revert to Licensor.
Sections 3.5 and 3.6 and Articles 7 and 8 shall survive for three (3) years
following termination.
ARTICLE 7
CONFIDENTIALITY
7.1 CONFIDENTIALITY.
(a) For purposes of this Agreement, "Confidential Information"
means any information or material disclosed or provided by Alanex to Licensor
pursuant to Article 3 or 4 of this Agreement, except:
(1) information that is known to or independently developed
by Licensor prior to the time of disclosure, as evidenced by Licensor's records;
(2) information disclosed to Licensor by a third party that
has a right to make such disclosure;
(3) information that becomes patented, published or
otherwise part of the public domain other than through breach of this Agreement;
or
(4) information that is required to be disclosed by law.
(b) Licensor shall, for the term of this Agreement, maintain
Confidential Information in confidence and shall not disclose Confidential
Information to any third party or use Confidential Information for any purpose
not contemplated under this Agreement, except with the written consent of
Alanex.
ARTICLE 8
INDEMNIFICATION AND INSURANCE
Alanex agrees to indemnify, hold harmless and defend Licensor, its
trustees, officers, medical and professional staff, employees, students and
agents, and their respective successors and assigns (the "Indemnitees"), against
any liability, damage, loss or expense (including reasonable attorneys fees and
expenses of litigation) incurred or imposed upon Indemnitees in connection with
any claims, suits, actions, demands or judgments resulting or arising out of the
development, distribution, possession, manufacture, use, sale or administration
of Licensed Products by Alanex, its affiliates or sublicensees, or by any third
party. Alanex or its
6.
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sublicensees agree to carry and keep in force general commercial liability
insurance of not less than $1 million per occurrence and $2 million in aggregate
to cover liability for damages on account of bodily or personal injury or death
to any person or damage to property of any person. In addition, Alanex or its
sublicensees shall keep in force product liability insurance of not less than $2
million per occurrence and $4 million in aggregate prior to any commercial
distribution of Licensed Products; provided, however, such limits shall be
increased if Licensor can demonstrate that higher amounts are customary for
businesses the size of Alanex or engaged in the business in which Alanex is
engaged. Licensor will be named as an additional insured on any such insurance
and such insurance shall not be canceled without at least thirty (30) days
notice to Licensor. Alanex shall provide a certificate of insurance evidencing
that all required coverage is in effect stating the limits of such coverage.
Such insurance shall be written to include coverage for any claims incurred in
connection with the matters which are the subject of this Agreement regardless
of when such claims are brought. Licensor shall promptly notify Alanex of any
claim for which Licensor may seek indemnification under this Article 8. Alanex
shall have the right to control the defense of such claim and may enter into any
settlement that does not adversely affect the rights of Licensor. Licensor shall
fully cooperate with Alanex in the defense of such claim, with out-of-pocket
costs reimbursed by Alanex as part of the indemnification.
ARTICLE 9
GENERAL
9.1 GOVERNING LAW. This Agreement shall be governed and construed in
accordance with the laws of the State of California, as applied to contracts
executed and performed entirely within the State of California, without regard
to conflicts of laws rules.
9.2 USE OF NAME. Alanex agrees that it will not use the name, trademark
or any other identifier of Licensor in any advertising or promotion without the
prior approval of Licensor, except to disclose the existence of this Agreement
and as otherwise required by law.
9.3 NOTICES. All notices or communications to either party by the other
party shall be delivered personally or sent by first-class or express mail,
postage prepaid, addressed to such party at the following addresses for each and
shall be deemed given on the date so delivered.
If to Licensor,
Mount Sinai School of Medicine of
the City University of New York
▇▇▇ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: Director, Office of Science
and Technology Development
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If to Alanex,
Alanex Corporation
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Chief Executive Officer
9.4 ASSIGNMENT. Neither party to this Agreement may assign or transfer
any rights or obligations arising from this Agreement without the prior written
consent of the other party, not to be unreasonably withheld; provided, however,
that Alanex may assign all of its rights and obligations under this Agreement in
connection with a merger, sale of assets or other transaction involving a change
of control of Alanex's business.
9.5 AMENDMENT. No amendment, modification or supplement of any
provision of the Agreement will be valid or effective unless made in writing and
signed by an authorized representative of each party.
9.6 WAIVER. No waiver of any provision of this Agreement in a
particular instance shall be deemed to be a waiver of any provision of this
Agreement in a later instance.
9.7 SEVERABILITY. Whenever possible, each provision of this Agreement
will be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of the Agreement is held to be prohibited by or
invalid under applicable law, such provision will be ineffective only to the
extent of such prohibition or invalidity, without invalidating the remainder of
the Agreement.
9.8 ENTIRE AGREEMENT OF THE PARTIES. This Agreement will constitute and
contain the complete, final and exclusive understanding and agreement of the
parties and cancels and supersedes any and all prior negotiations,
correspondence, understandings and agreements, whether oral or written, between
the parties respecting the subject matter hereof.
9.9 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, all of which together shall constitute one instrument.
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the Effective Date.
ALANEX CORPORATION MOUNT SINAI SCHOOL OF MEDICINE
OF THE CITY UNIVERSITY OF NEW YORK
By:/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ By:/s/ ▇▇▇▇▇▇ ▇▇▇▇
--------------------------- -------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ Name: ▇▇▇▇▇▇ ▇▇▇▇, M.D.
------------------------- -----------------------------
Title: President & CEO Title: ▇▇▇▇
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9.
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EXHIBIT A
LICENSED TECHNOLOGY
I. LICENSED PATENTS
EXHIBIT A
LICENSED PATENTS
Title: GnRH RECEPTOR
Serial No.: 07/938,189
Filed: August 28, 1992
Status: Abandoned In Favor Of CIP
Title: CLONING AND EXPRESSION OF GONADOTROPIN-RELEASING
HORMONE RECEPTOR
▇▇▇. Type: CIP
Serial No.: 08/080,386
Filed: June 21, 1993
Status: Pending
Title: CLONING AND EXPRESSION OF GONADOTROPIN-RELEASING
HORMONE RECEPTOR
▇▇▇. Type: CIP
Serial No.: 08/390,000
Filed: February 17, 1995
Status: Pending
Titled: CLONING AND EXPRESSION OF GONADOTROPIN-RELEASING
HORMONE RECEPTOR
Appln. No.: PCT/US93/05965
Filed: June 23, 1992
Status: Published on January 6, 1994
Publ. No.: W094/00590
Title: CLONING AND EXPRESSION OF GONADOTROPIN-RELEASING
HORMONE RECEPTOR
Country: Canada
Appln. No.: 2,138,999
Filed: June 22, 1993
Status: Request For Examination Due: June 22, 2000
Title: CLONING AND EXPRESSION OF GONADOTROPIN-RELEASING
HORMONE RECEPTOR
Country: Japan
Appln. No.: 6-502535
Filed: June 22, 1993
Status: Request For Examination Due: June 22, 2000
Title: CLONING AND EXPRESSION OF GONADOTROPIN-RELEASING
HORMONE RECEPTOR
Country: EPC (designating Austria, Belgium, France, Germany, Italy,
Luxembourg, Netherlands, Sweden, Switzerland, United
Kingdom, Greece, Spain, Liechtenstein, Denmark, Ireland,
Monaco, and Portugal)
Appln. No.: 9315447.2
Filed: June 22, 1993
Status: Request For Examination Filed
II. LICENSED KNOW-HOW
NONE
i.