Exhibit 10.21
[CERTAIN MATERIAL (INDICATED BY A [*CON*]) HAS BEEN OMITTED FROM THIS
DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED
MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]
LICENSE AND OPTION AGREEMENT
BY AND BETWEEN
APOLLO BIOPHARMACEUTICS, INC.
AND
AMERICAN HOME PRODUCTS CORPORATION
ACTING THROUGH ITS WYETH-AYERST LABORATORIES DIVISION
FEBRUARY 8, 1999
TABLE OF CONTENTS
1. DEFINITIONS.....................................................................................1
1.1 "AFFILIATE(S)".........................................................................1
1.2 "APOLLO NCE"...........................................................................1
1.3 "APOLLO PATENT RIGHTS".................................................................2
1.4 "COMMERCIALLY REASONABLE EFFORTS"......................................................2
1.5 "CONTROL" OR "CONTROLLED"..............................................................2
1.6 "EFFECTIVE DATE".......................................................................2
1.7 [ * CON * ]............................................................................2
1.8 [ * CON * ]............................................................................3
1.9 "FIELD"................................................................................3
1.10 "FIRST COMMERCIAL SALE"................................................................3
1.11 [ * CON * ]............................................................................3
1.12 "HSR ACT"..............................................................................3
1.13 "INTERIM CLINICAL EVALUATION POINT" OR "ICE"...........................................3
1.14 "IND FILING"...........................................................................3
1.15 "IND TRACK"............................................................................3
1.16 "KNOW-HOW".............................................................................3
1.17 "LICENSED PRODUCT(S)"..................................................................3
1.18 "MAJOR COUNTRY"........................................................................4
1.19 "NET SALES"............................................................................4
1.20 [ * CON * ]............................................................................5
1.21 [ * CON * ]............................................................................5
1.22 "OPTION TERM"..........................................................................5
1.23 "PRODUCT"..............................................................................5
1.24 "PRODUCT TYPE".........................................................................5
1.25 "REGULATORY APPROVAL"..................................................................5
1.26 "REGULATORY AUTHORITY".................................................................5
1.27 "SCIENTIFIC REVIEW COMMITTEE"..........................................................6
1.28 "START PHASE III"......................................................................6
1.29 "TERRITORY"............................................................................6
1.30 "THIRD PARTY(IES)".....................................................................6
1.31 "TYPE A PRODUCT".......................................................................6
1.32 "TYPE B PRODUCT".......................................................................6
1.33 "TYPE C PRODUCT".......................................................................6
1.34 "TYPE D PRODUCT".......................................................................6
1.35 "TYPE E PRODUCT".......................................................................6
1.36 [ * CON * ]............................................................................6
1.37 "VALID CLAIM"..........................................................................6
2. RIGHTS GRANTED..................................................................................7
2.1 EXCLUSIVE LICENSE......................................................................7
2.2 SUBLICENSES............................................................................7
2.3 GRANT OF OPTIONS.......................................................................7
2.3.1 TYPE C PRODUCTS...............................................................8
2.3.2 TYPE D PRODUCTS...............................................................8
2.3.3 TYPE E PRODUCTS...............................................................8
2.4 EXERCISE OF OPTIONS....................................................................8
2.5 [ * CON * ]............................................................................9
2.6 HSR FILING AND APPROVALS...............................................................9
2.6.1 HSR FILING....................................................................9
2.6.2 APOLLO'S AND AHPC'S OBLIGATIONS..............................................10
2.6.3 ADDITIONAL APPROVALS.........................................................10
i
2.6.4 FAILURE TO CLOSE.............................................................10
2.7 U.S. MANUFACTURE......................................................................11
3. CONSIDERATION..................................................................................11
3.1 LICENSE FEE...........................................................................11
3.2 ADDITIONAL FEES - TYPE A PRODUCT......................................................11
3.3 ADDITIONAL FEES - TYPE B PRODUCTS.....................................................12
3.4 OPTION TERM EXTENSION FEES............................................................12
3.5 OPTION EXERCISE FEE...................................................................12
3.5.1 TYPE C PRODUCTS..............................................................12
3.5.2 TYPE D PRODUCTS..............................................................12
3.5.3 TYPE E PRODUCTS..............................................................13
3.6 ADDITIONAL FEES - TYPE C PRODUCTS.....................................................13
3.7 ADDITIONAL FEES - TYPE D PRODUCTS.....................................................13
3.8 ADDITIONAL FEES - TYPE E PRODUCTS.....................................................14
3.9 ROYALTIES.............................................................................14
3.9.1 ROYALTY RATES -- TYPE A PRODUCTS.............................................14
3.9.2 ROYALTY RATES -- TYPE B PRODUCTS.............................................15
3.9.3 ROYALTY RATES -- TYPE C PRODUCTS.............................................15
3.9.4 ROYALTY RATES -- TYPE D PRODUCTS.............................................15
3.9.5 ROYALTY RATES -- TYPE E PRODUCTS.............................................16
3.9.6 TERM AND SCOPE OF ROYALTY OBLIGATIONS........................................16
3.9.7 THIRD PARTY LICENSES.........................................................16
3.10 REPORTS AND PAYMENT OF ROYALTY........................................................17
3.10.1 ROYALTIES PAID QUARTERLY.....................................................17
3.10.2 METHOD OF PAYMENT............................................................17
3.11 MAINTENANCE OF RECORDS; AUDITS........................................................17
3.11.1 RECORD KEEPING BY AHPC.......................................................17
3.11.2 AUDIT BY APOLLO..............................................................18
3.11.3 UNDERPAYMENTS/OVERPAYMENTS...................................................18
3.11.4 RECORD KEEPING BY SUBLICENSEE................................................19
3.11.5 CONFIDENTIALITY..............................................................19
3.12 TAXES AND WITHHOLDING.................................................................19
3.13 FOREIGN EXCHANGE......................................................................19
3.14 INTEREST..............................................................................19
4. PRODUCT DEVELOPMENT AND COMMERCIALIZATION......................................................19
4.1 DEVELOPMENT AND REGISTRATION OF LICENSED PRODUCTS.....................................19
4.1.1 DILIGENCE OBLIGATION.........................................................19
4.1.2 TYPE D PRODUCTS..............................................................20
4.1.3 TYPE E PRODUCTS..............................................................20
4.2 EXTENSION OF TIME.....................................................................20
4.3 COMMERCIALIZATION OF LICENSED PRODUCTS................................................20
4.4 STATUS REPORTS........................................................................20
4.5 APOLLO DEVELOPMENT AND REPORTING OBLIGATIONS..........................................21
4.5.1 DEVELOPMENT..................................................................21
4.5.2 SCIENTIFIC REVIEW COMMITTEE; REPORTS.........................................21
5. REGULATORY MATTERS.............................................................................22
5.1 REGULATORY FILINGS....................................................................22
5.2 ADVERSE EVENT REPORTING...............................................................22
ii
6. INTELLECTUAL PROPERTY..........................................................................22
6.1 FILING, PROSECUTION AND MAINTENANCE OF APOLLO PATENT RIGHTS...........................22
6.2 OPTION OF AHPC TO PROSECUTE AND MAINTAIN APOLLO PATENT RIGHTS.........................23
6.3 ENFORCEMENT OF APOLLO PATENT RIGHTS...................................................23
6.3.1 NOTICE AND DISCONTINUANCE OF INFRINGEMENT....................................23
6.3.2 CONTINUANCE OF INFRINGEMENT..................................................24
6.4 INFRINGEMENT OF THIRD PARTY PATENTS; THIRD PARTY LICENSES.............................25
6.4.1 COURSE OF ACTION.............................................................25
6.4.2 AHPC OPTION TO NEGOTIATE.....................................................25
6.4.3 APOLLO OPTION TO NEGOTIATE...................................................25
6.4.4 THIRD PARTY INFRINGEMENT SUIT................................................25
6.5 CERTIFICATION UNDER DRUG PRICE COMPETITION AND PATENT RESTORATION ACT.................27
6.6 ABANDONMENT...........................................................................27
6.7 PATENT TERM RESTORATION...............................................................27
6.8 NOTICES REGARDING PATENTS.............................................................28
7. REPRESENTATIONS AND WARRANTIES.................................................................29
7.1 REPRESENTATIONS AND WARRANTIES OF BOTH PARTIES........................................29
7.2 REPRESENTATIONS AND WARRANTIES OF APOLLO..............................................29
7.3 REPRESENTATION BY LEGAL COUNSEL.......................................................31
7.4 PRIOR AGREEMENTS......................................................................31
7.5 APOLLO DISCLAIMER.....................................................................32
8. TERM AND TERMINATION...........................................................................32
8.1 TERM AND EXPIRATION...................................................................32
8.2 TERMINATION BY AHPC...................................................................32
8.3 TERMINATION BY APOLLO FOR LACK OF DILIGENCE...........................................32
8.3.1 FAILURE TO USE COMMERCIALLY REASONABLE EFFORTS...............................33
8.3.2 FAILURE TO FILE IND..........................................................33
8.4 TERMINATION FOR CAUSE.................................................................33
8.5 EFFECT OF TERMINATION.................................................................34
8.5.1 TERMINATION BY AHPC..........................................................34
8.5.2 TERMINATION BY APOLLO........................................................34
8.5.3 EFFECT OF BANKRUPTCY.........................................................35
8.6 SURVIVAL OF OBLIGATIONS...............................................................35
9. INDEMNIFICATION AND INSURANCE..................................................................35
9.1 INDEMNIFICATION BY AHPC...............................................................35
9.2 INDEMNIFICATION BY APOLLO.............................................................36
9.3 CONDITIONS TO INDEMNIFICATION.........................................................36
9.4 SETTLEMENTS...........................................................................37
9.5 LIMITATION OF LIABILITY...............................................................37
9.6 INSURANCE.............................................................................37
10. CONFIDENTIALITY................................................................................38
10.1 NONDISCLOSURE OBLIGATION..............................................................38
10.2 PERMITTED DISCLOSURES.................................................................39
10.3 RETURN OF INFORMATION.................................................................39
10.4 DISCLOSURE OF AGREEMENT...............................................................39
10.5 PUBLICITY.............................................................................39
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11. MISCELLANEOUS..................................................................................40
11.1 FORCE MAJEURE.........................................................................40
11.2 ASSIGNMENT............................................................................40
11.2.1 ASSIGNMENT BY APOLLO.........................................................40
11.2.2 ASSIGNMENT BY AHPC...........................................................40
11.2.3 BINDING NATURE OF ASSIGNMENT.................................................41
11.3 NO WAIVER.............................................................................41
11.4 SEVERABILITY..........................................................................41
11.5 RELATIONSHIP BETWEEN THE PARTIES......................................................41
11.6 CORRESPONDENCE AND NOTICES............................................................41
11.6.1 ORDINARY NOTICES.............................................................41
11.6.2 EXTRAORDINARY NOTICES........................................................41
11.6.3 ADDRESSES....................................................................42
11.7 CHOICE OF LAW; DISPUTE RESOLUTION.....................................................42
11.8 PROVISIONS FOR INSOLVENCY.............................................................44
11.8.1 EFFECT ON LICENSES...........................................................44
11.8.2 RIGHTS TO INTELLECTUAL PROPERTY..............................................45
11.8.3 AHPC'S RIGHTS................................................................45
11.9 EXPORT CONTROLS.......................................................................46
11.10 NON-USE OF NAMES......................................................................46
11.11 ENTIRE AGREEMENT; AMENDMENT...........................................................46
11.12 HEADINGS..............................................................................46
11.13 COUNTERPARTS..........................................................................47
11.14 FURTHER ACTIONS.......................................................................47
Exhibit A - Apollo Patent Rights
Exhibit B - Definition of Estrogen Excerpted from U.S. Patent 5,554,601
Exhibit C - Adverse Drug Experience Reporting Procedures
iv
LICENSE AND OPTION AGREEMENT
THIS
LICENSE AND OPTION AGREEMENT (the "Agreement") is entered into as
of this 8th day of February, 1999, by and between APOLLO BIOPHARMACEUTICS, INC.,
a corporation organized and existing under the laws of the state of Delaware and
having a place of business at ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ("Apollo"), and AMERICAN HOME PRODUCTS CORPORATION, acting through its
WYETH-AYERST LABORATORIES DIVISION, a corporation organized and existing under
the laws of the State of Delaware and having a place of business at ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ("AHPC"). Both Apollo and
AHPC are referred to herein individually as a "Party" and collectively as the
"Parties".
WHEREAS, Apollo has rights to certain patents and/or patent
applications and know-how pertaining to the use of certain estrogen compounds
for the treatment or prevention of neurodegenerative diseases, some of which
rights were obtained pursuant to and are governed by a license granted to Apollo
by [ * CON * ]; and
WHEREAS, AHPC desires to obtain an exclusive license under such
patents, patent applications and know-how and Apollo desires to grant such a
license to AHPC.
NOW THEREFORE, in consideration of the foregoing premises and the
mutual promises, covenants and conditions set forth below, the Parties,
intending to be legally bound, hereby agree as follows:
1. DEFINITIONS.
1.1 "AFFILIATE(S)" shall mean any corporation, company,
partnership, joint venture and/or firm which controls, is
controlled by or is under common control with a Party. For
purposes of this Section 1.1, "control" shall mean (a) in the
case of corporate entities, direct or indirect ownership of at
least fifty percent (50%) of the stock or shares having the
right to vote for the election of directors, and (b) in the
case of non-corporate entities, direct or indirect ownership
of at least fifty percent (50%) of the equity interest with
the power to direct the management and policies of such
non-corporate entities, PROVIDED, HOWEVER, that, for purposes
of this Agreement, the term "Affiliate" shall not include any
entity with respect to which there is a contractual
restriction on the right to elect a majority of the directors
or to otherwise direct the management and policies of such
entity, until such time as such restrictions are no longer in
effect.
1.2 "APOLLO NCE" shall mean a compound, consisting of an [ * CON *
] and useful or potentially useful as an active ingredient in
a pharmaceutical product, the making, using or selling of
which would, but for the licenses granted hereunder, infringe
a Valid Claim included within the Apollo
Patent Rights which Valid Claim reads on the composition of
matter of such Compound.
1.3 "APOLLO PATENT RIGHTS" shall mean all patents or patent
applications and all divisionals, continuations,
continuations-in-part, reissues, renewals, substitutions,
extensions, supplementary protection certificates and foreign
counterparts thereof, existing as of the Effective Date or
filed or issuing during the term of this Agreement which (i)
are Controlled by Apollo or its Affiliates and (ii) contain at
least one claim which reads on either the composition of
matter of any Product or a method of using any Product in the
Field. For the sake of clarity, a "method of using any
Product" shall not be deemed to include any drug delivery
system which may otherwise be encompassed by the Apollo Patent
Rights, except to the extent that, with respect to Type D
Products and/or Type E Products, on a Product by Product
basis, such drug delivery system is the only mechanism or
method for delivering such Product to a patient in order to
achieve both the desired safety profile and the desired
therapeutic or prophylactic effect in the Field. The Apollo
Patent Rights existing as of the Effective Date are listed in
Exhibit A attached hereto.
1.4 "COMMERCIALLY REASONABLE EFFORTS" shall mean efforts and
resources normally used by a Party for a product owned by it
or to which it has rights, which is of similar market
potential at a similar stage in its development or product
life, taking into account issues of safety and efficacy,
product profile, the competitiveness of the marketplace, the
proprietary position of the compound or product, the
regulatory structure involved, the profitability of the
applicable products, and other relevant factors.
1.5 "CONTROL" OR "CONTROLLED" shall mean with respect to any (i)
item of information, including, without limitation, Know-How,
or (ii) intellectual property right, the possession (whether
by ownership or license) by a Party of the ability to grant to
the other Party access and/or a license as provided herein
under such item or right without violating the terms of any
agreement or other arrangements with any Third Party.
1.6 "EFFECTIVE DATE" shall mean the next business day following
the last to occur of: (i) the delivery to each Party of fully
executed counterparts of this Agreement, (ii) a determination
made by AHPC's finance committee that a notification of this
Agreement is not required to be made under the HSR Act, and
(iii) if notification of this Agreement is required to be made
under the HSR Act, the expiration or earlier termination of
any notice and waiting period under the HSR Act.
1.7 [ * CON * ]
2
1.8 [ * CON * ]
1.9 "FIELD" shall mean [ * CON * ].
1.10 "FIRST COMMERCIAL SALE" shall mean, with respect to any
Licensed Product, the first sale of such Licensed Product, for
use in the Field, by AHPC, its Affiliates or sublicensees, to
a Third Party in any country of the Territory, after such
Licensed Product has been granted Regulatory Approval for use
in the Field by the competent Regulatory Authorities in such
country.
1.11 [ * CON * ] shall mean that certain Patent License Agreement
With Research Component entered into [ * CON * ].
1.12 "HSR ACT" shall mean the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust
Improvements Act of 1976, as amended, and the rules and
regulations promulgated thereunder.
1.13 "INTERIM CLINICAL EVALUATION POINT" or "ICE" shall mean, with
respect to any Licensed Product, [ * CON * ].
1.14 "IND FILING" shall mean the submission by AHPC (with respect
to Type A, Type B or Type C Products) or by either Party (with
respect to Type D or Type E Products) of an application to the
United States Food and Drug Administration ("FDA") to conduct
clinical trials with a Product and the allowance by the FDA to
commence such studies.
1.15 "IND TRACK" shall mean the nomination by AHPC, its Affiliates
or sublicensees of a Licensed Product for development to IND
Filing, according to AHPC's standard internal criteria, an
example of which has been provided by AHPC to Apollo on or
before the date this Agreement was signed by the Parties.
1.16 "KNOW-HOW" shall mean all know-how, processes, materials,
information, data and analyses including any copyright
relating thereto Controlled by Apollo as of the Effective Date
or coming into the Control of Apollo during the term of this
Agreement relating to estrogen compounds with respect to the
Field.
1.17 "LICENSED PRODUCT(S)" shall mean any Type A Product or Type B
Product, and upon AHPC's exercise of the option(s) granted
under Section 2.3 hereof and the payment of the applicable
option exercise fee, any Type C Product, Type D Product and/or
Type E Product, as applicable. For purposes of this Agreement,
if two or more Licensed Products contain the same active
ingredients they shall be considered to be the same Licensed
3
Product. Additionally, if one or more of the following
products become Licensed Products under this Agreement they
shall be considered to be the same Licensed Product for all
purposes under this Agreement: [ * CON * ].
1.18 "MAJOR COUNTRY" shall mean the USA, Canada, France, Germany,
U.K., Italy, Japan.
1.19 "NET SALES" shall mean with respect to a Licensed Product, the
gross amount invoiced by AHPC, its Affiliates and/or its
sublicensees, on sales or other dispositions of such Licensed
Product to unrelated Third Parties, less the following items,
provided that such items are actually included in the price
charged and do not exceed reasonable and customary amounts in
the country in which such sale occurred:
(a) Trade, cash and quantity discounts actually
allowed and taken directly with respect to
such sales;
(b) Excises, sales taxes or other taxes imposed
upon and paid directly with respect to such
sales (excluding national, state or local
taxes based on income);
(c) Amounts repaid or credited by reason of
rejections, defects, recalls or returns or
because of rebates or retroactive price
reduction; and
(d) freight, transportation and insurance.
Such amounts shall be determined from the books and records of
AHPC, its Affiliates and/or its sublicensees, maintained in
accordance with generally accepted accounting principles,
consistently applied.
If such Licensed Product is sold in bulk (as distinguished
from packaged pharmaceutical form) for resale in packaged or
finished form, Net Sales shall be calculated by determining
the quantity of such Licensed Product in packaged
pharmaceutical form that would reasonably be produced from the
bulk quantity of such Licensed Product so sold, and by
multiplying such quantity by the average price for such
Licensed Product in packaged pharmaceutical form during the
applicable royalty reporting period. If such Licensed Product
is sold, or otherwise commercially disposed of for value
(including, without limitation, disposition in connection with
the delivery of other products or services), in a transaction
that is not a sale for cash to an independent Third Party,
then the gross amount invoiced in such transaction shall be
deemed to be the gross amount that would have been paid had
there been such a sale at the average sale price of such
Licensed Product during the applicable royalty reporting
period; provided, however, that sale of such
4
Licensed Product in bulk to a Third Party end user who
repackages but does not resell such Licensed Product shall be
calculated at the actual transaction price.
Net Sales shall not include any consideration received by
AHPC, its Affiliates or its licensees or sublicensees in
respect of the sale, use or other disposition of such Licensed
Product in a country as part of a clinical trial prior to the
receipt of all Regulatory Approvals required to commence full
commercial sales of such Licensed Product in such country,
except sales under "treatment INDS," "named patient sales,"
"compassionate use sales," or their equivalents pursuant to
which AHPC, its Affiliates or licenses and sublicensees is/are
entitled, under applicable laws, regulations and regulatory
policies, to recover costs incurred in providing such Licensed
Products to the patients.
1.20 [ * CON * ]
1.21 [ * CON * ]
1.22 "OPTION TERM" shall mean the [ * CON * ] ([ * CON * ]) year
period commencing on the Effective Date and any extensions of
such [ * CON * ] ([ * CON * ]) year period made in accordance
with Section 2.4 hereof or as may otherwise be agreed to by
the Parties in writing.
1.23 "PRODUCT" shall mean any pharmaceutical product containing, as
an active ingredient, [ * CON * ] or an Apollo NCE.
1.24 "PRODUCT TYPE" shall mean either all Type A Products, all Type
B Products, all Type C Products, all Type D Products or all
Type E Products.
1.25 "REGULATORY APPROVAL" shall mean the technical, medical and
scientific licenses, registrations, authorizations and
approvals (including, without limitation, approvals of New
Drug Applications, supplements and amendments, pre- and post-
approvals, pricing and third party reimbursement approvals,
and labeling approvals) of any national, supra-national,
regional, state or local regulatory agency, department,
bureau, commission, council or other governmental entity,
necessary for the development, manufacture, distribution,
marketing, promotion, offer for sale, use, import, export or
sale of Licensed Product(s) in a regulatory jurisdiction.
1.26 "REGULATORY AUTHORITY" shall mean any mean any national (e.g.,
the United States Food and Drug Administration),
supra-national (e.g., the European Commission, the Council of
the European Union, or the
5
European Agency for the Evaluation of Medicinal Products),
regional, state or local regulatory agency, department,
bureau, commission, council or other governmental entity in
each country of the Territory involved in the granting of
Regulatory Approval for the Licensed Product.
1.27 "SCIENTIFIC REVIEW COMMITTEE" shall have the meaning set forth
in Section 4.5.2 hereof.
1.28 "START PHASE III" shall mean the first dosing of a patient in
a pivotal, registration clinical trial post-Phase II, under a
protocol approved by a governmental regulatory agency, to the
extent necessary (e.g., the U.S. FDA), in a Major Country.
1.29 "TERRITORY" shall mean all countries of the world.
1.30 "THIRD PARTY(IES)" shall mean any person(s) or entity(ies)
other than AHPC, Apollo or their respective Affiliates.
1.31 "TYPE A PRODUCT" shall mean a Product, [ * CON * ], and (iii)
the manufacture, use or sale of which, but for the licenses
granted hereunder, would infringe a Valid Claim included
within the Apollo Patent Rights.
1.32 "TYPE B PRODUCT" shall mean a Product, [ * CON * ] the
manufacture, use or sale of which, but for the licenses
granted hereunder, would infringe a Valid Claim included
within the Apollo Patent Rights.
1.33 "TYPE C PRODUCT" shall mean a Product, [ * CON * ]
manufacture, use or sale of which, but for the licenses
granted hereunder, would infringe a Valid Claim included
within the Apollo Patent Rights.
1.34 "TYPE D PRODUCT" shall mean a Product, [ * CON * ] the
manufacture, use or sale of which, but for the licenses
granted hereunder, would infringe a Valid Claim included
within the Apollo Patent Rights.
1.35 "TYPE E PRODUCT" shall mean a Product [ * CON * ].
1.36 [ * CON * ]
1.37 "VALID CLAIM" shall mean an unexpired claim of an issued and
unexpired patent or a claim of a pending patent application,
each forming part of the Apollo Patent Rights, which claim has
not been (i) declared invalid or unenforceable by a government
agency or an order of a court or other tribunal of competent
jurisdiction from which no appeal has been or can be taken, or
(ii) admitted to be invalid or unenforceable through
reexamination, disclaimer or otherwise. Notwithstanding the
foregoing, if
6
a claim of a pending patent application has not issued as a
claim of an issued patent within the Apollo Patent Rights,
(a) in the case of United States patent
applications, within [ * CON * ] ([ * CON *
]) years after the filing date from which
such claim takes priority or
(b) in the case of patent applications filed in
countries other than the United States, [ *
CON * ] ([ * CON * ]) years after the later
of (x) the filing date from which such claim
takes priority or (y) if such national
patent application takes priority from a
patent application filed under the Patent
Cooperation Treaty ("PCT"), the filing date
of such PCT patent application, PROVIDED,
HOWEVER, that with respect to Japanese
patent applications, such [ * CON * ] ([ *
CON * ]) year period shall begin on the date
that the first national patent application
containing such claim is filed in Japan,
such pending claim shall cease to be a Valid Claim for
purposes of this Agreement unless and until such claim becomes
an issued claim of an issued patent within the Apollo Patent
Rights.
2. RIGHTS GRANTED.
2.1 EXCLUSIVE LICENSE. Apollo hereby grants to AHPC an exclusive
(exclusive, even as to Apollo and Apollo's Affiliates) license
under the Apollo Patent Rights and to use the Know-How to
develop, make, have made, use, market, promote, import, offer
for sale, and sell, in the Territory, Licensed Products for
use in the Field. With respect to any Apollo Patent Rights
which Apollo Controls by virtue of the license granted to
Apollo by [ * CON * ], the license granted to AHPC under this
Section 2.1 shall be subject only to (i) the non-exclusive
license granted to the United States Government, which license
is described in Section 2.1 of the [ * CON * ], and (ii) [ *
CON * ] reservation of rights, on behalf of the [ * CON * ],
to practice under such Apollo Patent Rights for [ * CON * ]
own non-commercial research purposes.
2.2 SUBLICENSES. AHPC shall have the right to grant one or more
sublicenses of the license granted to it under Section 2.1
hereof to any of its Affiliates or to any Third Party,
provided, however, that after granting any such sublicense,
AHPC shall provide Apollo with written notice that such
sublicense has been granted.
2.3 GRANT OF OPTIONS.
7
2.3.1 TYPE C PRODUCTS. Apollo hereby grants to AHPC an
exclusive option to obtain an exclusive (exclusive,
even as to Apollo and its Affiliates) license under
the Apollo Patent Rights and to use the Know-How to
develop, make, have made, use, market, promote,
import, offer for sale, and sell, in the Territory,
Type C Products for use in the Field. In the event
that AHPC, in accordance with Section 2.4 hereof,
exercises the option provided under this Section
2.3.1, Type C Products shall be considered to be
Licensed Products for purposes of this Agreement as
of the date the applicable option exercise fee is
paid in accordance with Section 3.5 hereof.
2.3.2 TYPE D PRODUCTS. Apollo hereby grants to AHPC an
exclusive option to obtain an exclusive (exclusive,
even as to Apollo and its Affiliates) license under
the Apollo Patent Rights and to use the Know-How How
to develop, make, have made, use, market, promote,
import, offer for sale, and sell, in the Territory,
Type D Products for use in the Field. In the event
that AHPC, in accordance with Section 2.4 hereof,
exercises the option provided under this Section
2.3.1, Type D Products shall be considered to be
Licensed Products for purposes of this Agreement as
of the date the applicable option exercise fee is
paid in accordance with Section 3.5 hereof.
2.3.3 TYPE E PRODUCTS. Apollo hereby grants to AHPC an
exclusive option to obtain an exclusive (exclusive,
even as to Apollo and its Affiliates) license under
the Apollo Patent Rights and to use the Know-How to
develop, make, have made, use, market, promote,
import, offer for sale, and sell, in the Territory,
Type E Products for use in the Field, on a Type E
Product by Type E Product basis. In the event that
AHPC, in accordance with Section 2.4 hereof,
exercises the option provided under this Section
2.3.1, with respect to a Type E Product, such Type E
Product shall be considered to be a Licensed Product
for purposes of this Agreement as of the date the
applicable option exercise fee is paid in accordance
with Section 3.5 hereof.
2.4 EXERCISE OF OPTIONS. AHPC may exercise any or all of the
options granted to it under Section 2.3.1 hereof by providing
to Apollo written notice of AHPC's election to do so prior to
the end of the Option Term. AHPC may exercise any or all of
the options granted to it under Section 2.3.2 or 2.3.3 hereof
by providing to Apollo written notice of AHPC's election to do
so no later than forty-five (45) days after AHPC receives the
final report at the final meeting of the Scientific Review
Committee. After exercising its option with respect to one or
more Product Types as set forth
8
above, AHPC shall pay the applicable option exercise fee(s) as
and when required under Section 3.5 hereof, at which time the
applicable Product Type(s) shall become Licensed Products
under this Agreement. Notwithstanding the foregoing, with
respect to Type C Products and Type E Products, AHPC may
extend the Option Term by up to [ * CON * ] ([ * CON * ])
additional [ * CON * ] ([ * CON * ]) year periods, by (i)
providing written notice to Apollo of its intent to so extend
the Option Term at least ninety (90) days prior to the
expiration of the then current Option Term (as such Option
Term may have been extended in accordance with this Section
2.4) and (ii) the payment of the appropriate option term
extension fee as set forth in Section 3.4 hereof.
2.5 [ * CON * ]. AHPC acknowledges that a portion of the Apollo
Patent Rights and Know-How licensed to AHPC hereunder or
pertaining to the options granted to AHPC hereunder are owned
by [ * CON * ] and are Controlled by Apollo pursuant to the [
* CON * ]. Apollo represents and warrants to AHPC and AHPC
acknowledges and agrees that, in the event the [ * CON * ] is
terminated for any reason and, at such time, AHPC is not in
default of its material obligations under this Agreement such
that Apollo would have the right to terminate this Agreement
as provided in Article 8 hereof, pursuant to the provisions of
the [ * CON * ], any licenses granted or to be granted by
Apollo to AHPC hereunder with respect to any Apollo Patent
Rights or Know-How which are subject to the [ * CON * ] (i.e.,
which are sublicensed, under the [ * CON * ], by Apollo to
AHPC) shall become direct licenses between [ * CON * ] and
AHPC and, as of such time and thereafter, AHPC shall make all
payments due hereunder with respect to such Apollo Patent
Rights and Know-How directly to [ * CON * ], which payments,
if overdue, shall bear interest until payment is made at the
monthly rate of [ * CON * ] percent ([ * CON * ]%) in
accordance with Section 5.4 of the [ * CON * ]. Any payments
so made to [ * CON * ] shall be deducted from any payments due
and payable to Apollo hereunder. Apollo agrees that it will
not modify or amend the [ * CON * ] without AHPC's prior
written consent, which consent shall not be unreasonably
withheld.
2.6 HSR FILING AND APPROVALS.
2.6.1 HSR FILING. To the extent necessary, each of Apollo
and AHPC shall file, as soon as practicable after the
date this Agreement was signed by each of the
Parties, with the Federal Trade Commission (the
"FTC") and the Antitrust Division of the United
States Department of Justice (the "Antitrust
Division") the notification and report form (the
"Report") required under the HSR Act with respect to
the transactions as contemplated hereby and shall
9
reasonably cooperate with the other Party to the
extent necessary to assist the other Party in the
preparation of its Report and to proceed to obtain
necessary approvals under the HSR Act, including but
not limited to the expiration or earlier termination
of any and all applicable waiting periods required by
the HSR Act. AHPC shall be responsible for paying any
fees required to be paid to any governmental agency
in connection with making such filings and each party
shall bear its own expenses, including, without
limitation, legal fees, incurred in connection with
preparing such filings.
2.6.2 APOLLO'S AND AHPC'S OBLIGATIONS Each of Apollo and
AHPC shall use its good faith efforts to eliminate
any concern on the part of any court or government
authority regarding the legality of the proposed
transaction, including, if required by federal or
state antitrust authorities, promptly taking all
steps to secure government antitrust clearance,
including, without limitation, cooperating in good
faith with any government investigation including the
prompt production of documents and information
demanded by a second request for documents and of
witnesses if requested.
2.6.3 ADDITIONAL APPROVALS. Apollo and AHPC will cooperate
and use respectively all reasonable efforts to make
all other registrations, filings and applications, to
give all notices and to obtain as soon as practicable
all governmental or other consents, transfers,
approvals, orders, qualifications authorizations,
permits and waivers, if any, and to do all other
things necessary or desirable for the consummation of
the transactions as contemplated hereby. Neither
Party shall be required, however, to divest products
or assets or materially change its business if doing
so is a condition of obtaining approval under the HSR
Act or other governmental approvals of the
transactions contemplated by this Agreement.
2.6.4 FAILURE TO CLOSE. In the event that on or before [ *
CON * ], [ * CON * ], (i) AHPC has not paid to Apollo
the initial [ * CON * ] dollar ($[ * CON * ]) license
fee as required under Section 3.1 hereof and (ii)
AHPC's finance committee fails to make a
determination as to whether or not a notification is
required to be filed under the HSR Act or, in the
event that AHPC's finance committee has determined
that a notification must be filed under the HSR Act,
AHPC has not filed such notification, then Apollo,
prior to the Effective Date, shall have the right to
terminate this Agreement by providing AHPC with
written notice to such effect. Upon AHPC's receipt of
such written notice, this Agreement shall
10
be null, void and of no effect and neither Party
shall have any further rights or obligations
hereunder. Notwithstanding the foregoing, the
provision of such notice shall have no effect on any
other agreements that may exist between the Parties,
including, without limitation, that certain
confidential disclosure agreement entered into by the
Parties on or about [ * CON * ], [ * CON * ].
2.7 U.S. MANUFACTURE. To the extent that any Licensed Product
which (a) is sold in the United States and (b) embodies an
invention or is made through the use of an invention which
invention is (i) claimed in one or more of the Apollo Patent
Rights that Apollo Controls by virtue of the license granted
to it by [ * CON * ] under the [ * CON * ] and (ii) a subject
invention (as such term is defined in 37 CFR Section 401.2) of
a funding agreement between an agency of the United States
Government and [ * CON * ], AHPC agrees that it shall
substantially manufacture such Licensed Product in the United
States, its territories or possessions unless such requirement
is waived by the funding agency. Apollo, upon AHPC's request,
shall cooperate with AHPC and [ * CON * ] in seeking a waiver
of such requirement.
3. CONSIDERATION.
3.1 LICENSE FEE. In partial consideration for the rights and
licenses granted to AHPC hereunder, AHPC, on the Effective
Date, shall pay to Apollo a license fee in the amount of [ *
CON * ] dollars ($[ * CON * ]). Additionally, within thirty
(30) days after Apollo has provided AHPC with written evidence
that a European Patent encompassed within the Apollo Patent
Rights and corresponding to United States Patent [ * CON * ]
has been granted and published, AHPC shall pay to Apollo the
sum of [ * CON * ] dollars ($[ * CON * ]), provided, however,
that such amount shall be payable one time only and shall
become due and payable only if, in AHPC's reasonable judgment,
the claim structure of such European Patent is materially no
less comprehensive than the claim structure in United States
Patent [ * CON * ].
3.2 ADDITIONAL FEES - TYPE A PRODUCT. In further consideration for
the rights and licenses granted to AHPC hereunder with respect
to Type A Product, AHPC shall pay to Apollo additional license
fees as follows for each Type A Product developed by AHPC, its
Affiliates or sublicensees hereunder for use in the Field,
each such payment being due and payable (i) within thirty (30)
days after the occurrence of the event triggering such payment
hereunder and (ii) only one time with respect to any Type A
Product:
[ * CON * ]
11
3.3 ADDITIONAL FEES - TYPE B PRODUCTS. In further consideration
for the rights and licenses granted to AHPC hereunder with
respect to Type B Products, AHPC shall pay to Apollo
additional license fees as follows for each Type B Product
developed by AHPC, its Affiliates or sublicensees hereunder
for use in the Field, each such payment being due and payable
(i) within thirty (30) days after the occurrence of the event
triggering such payment hereunder and (ii) only one time with
respect to any Type B Product:
[ * CON * ]
3.4 OPTION TERM EXTENSION FEES. In the event that AHPC, pursuant
to Section 2.4 hereof, elects to extend the Option Term for [
* CON * ] ([ * CON * ]) additional [ * CON * ] ([ * CON * ])
year period, AHPC shall pay to Apollo an option extension fee
in the amount of [ * CON * ] dollars ($[ * CON * ]) which fee
shall be due and payable on the [ * CON * ] anniversary of the
Effective Date and in the event that AHPC, pursuant to Section
2.4 hereof, elects to extend the Option Term for a [ * CON * ]
additional [ * CON * ] ([ * CON * ]) year period, AHPC shall
also pay to Apollo an additional option extension fee in the
amount of [ * CON * ] ($[ * CON * ]), which fee shall be due
and payable on the [ * CON * ] anniversary of the Effective
Date.
3.5 OPTION EXERCISE FEE.
3.5.1 TYPE C PRODUCTS. In the event that AHPC exercises the
option granted to it under Section 2.3.1 hereof, AHPC
shall pay to Apollo an option exercise fee in the
amount of [ * CON * ] dollars ($[ * CON * ]) which
option exercise fee shall be due and payable within
ten (10) business days after the later of (i)
Apollo's receipt of AHPC's written notice exercising
its option under Section 2.3.1 or (ii) if a
notification is required to be filed under the HSR
Act with respect to AHPC's exercise of the option
under Section 2.3.1 hereof, the expiration or early
termination of any applicable notice and waiting
period under the HSR Act.
3.5.2 TYPE D PRODUCTS. In the event that AHPC exercises the
option granted to it under Section 2.3.2 hereof, AHPC
shall pay to Apollo an option exercise fee in the
amount of [ * CON * ] dollars ($[ * CON * ]) which
option exercise fee shall be due and payable within
ten (10) business days after the later of (i)
Apollo's receipt of AHPC's written notice exercising
its option under Section 2.3.2 or (ii) if a
notification is required to be filed under the HSR
Act with respect to AHPC's exercise of the option
under Section 2.3.2
12
hereof, the expiration or early termination of any
applicable notice and waiting period under the HSR
Act.
3.5.3 TYPE E PRODUCTS. In the event that AHPC exercises the
option granted to it under Section 2.3.3 hereof, AHPC
shall pay to Apollo an option exercise fee in the
amount of [ * CON * ] dollars ($[ * CON * ]) which
option exercise fee shall be due and payable within
ten (10) business days after the later of (i)
Apollo's receipt of AHPC's written notice exercising
its option under Section 2.3.3 or (ii) if a
notification is required to be filed under the HSR
Act with respect to AHPC's exercise of the option
under Section 2.3.3 hereof, the expiration or early
termination of any applicable notice and waiting
period under the HSR Act.
3.6 ADDITIONAL FEES - TYPE C PRODUCTS. In the event that AHPC
exercises its option under Section 2.3.1 hereof, then in
further consideration for the rights and licenses granted to
AHPC hereunder with respect to Type C Products, AHPC shall pay
to Apollo additional license fees as follows for each Type C
Product developed by AHPC, its Affiliates or sublicensees
hereunder for use in the Field, each such payment being due
and payable (i) within thirty (30) days after the occurrence
of the event triggering such payment hereunder and (ii) only
one time with respect to any Type C Product:
[ * CON * ]
3.7 ADDITIONAL FEES - TYPE D PRODUCTS. In the event that AHPC
exercises its option under Section 2.3.2 hereof, then in
further consideration for the rights and licenses granted to
AHPC hereunder with respect to Type D Products, AHPC shall pay
to Apollo additional license fees as follows for each Type D
Product developed by AHPC, its Affiliates or sublicensees
hereunder for use in the Field, each such payment being due
and payable (i) within thirty (30) days after the occurrence
of the event triggering such payment hereunder and (ii) only
one time with respect to any Type D Product:
[ * CON * ]
Notwithstanding the foregoing, the amounts payable by AHPC
under parts (k), (l), (m), (n), (o), and (p) of this Section
3.7 shall be payable only for the [ * CON * ] label indication
per Type D Product to trigger each such payment, with [ * CON
* ] percent ([ * CON * ]%) of the amount specified being
payable for the [ * CON * ] such Type D Product label
indication to trigger such payment and [ * CON * ] percent ([
* CON *
13
]%) of the amount specified being payable for the [ * CON * ]
such Type D Product label indication to trigger such payment.
3.8 ADDITIONAL FEES - TYPE E PRODUCTS. In the event that AHPC
exercises its option under Section 2.3.3 hereof, then in
further consideration for the rights and licenses granted to
AHPC hereunder with respect to Type E Products, AHPC shall pay
to Apollo additional license fees as follows for each Type E
Product developed by AHPC, its Affiliates or sublicensees
hereunder for use in the Field, each such payment being due
and payable (i) within thirty (30) days after the occurrence
of the event triggering such payment hereunder and (ii) only
one time with respect to any Type E Product:
[ * CON * ]
Notwithstanding the foregoing, the amounts payable by AHPC
under parts (k), (l), (m), (n), (o), and (p) of this Section
3.8 shall be payable only for the [ * CON * ] label
indications per Type E Product to trigger each such payment,
with [ * CON * ] percent ([ * CON * ]%) of the amount
specified being payable for the [ * CON * ] such Type E
Product label indication to trigger such payment and [ * CON *
] percent ([ * CON * ]%) of the amount specified being payable
for the [ * CON * ] such Type E Product label indication to
trigger such payment.
3.9 ROYALTIES.
3.9.1 ROYALTY RATES -- TYPE A PRODUCTS. In further
consideration for the licenses and other rights
granted to AHPC hereunder with respect to Type A
Products, AHPC shall pay to Apollo royalties, with
respect to each Type A Product sold by AHPC, its
Affiliates or sublicensees, as follows:
[ * CON * ]
Each such quarterly payment shall be made at the time
set forth in Section 3.10.1 hereof, with the first
such quarterly payment being due and payable after
the end of the Calendar Quarter in which such First
Commercial Sale was made. Notwithstanding the
foregoing, in the event that, during any Calendar
Quarter, AHPC, its Affiliates, or sublicensees sell a
Type A Product in one or more countries of the
Territory where there is not a Valid Claim covering
the use of such Type A product in the Field, the
royalty payable with respect to such Calendar Quarter
under this Section 3.9.1 shall be adjusted by
multiplying the amount set forth in Section 3.9.1(a),
3.9.1(b) or 3.9.1(c), as applicable, by a factor
equal to [ * CON * ],
14
where [ * CON * ] is the sum of AHPC's, its
Affiliates' and its sublicensees' Net Sales of Type A
Products in such countries during such Calendar
Quarter and [ * CON * ] is the sum of AHPC's, its
Affiliates' and its sublicensees' worldwide Net Sales
of Type A Products during such Calendar Quarter.
3.9.2 ROYALTY RATES -- TYPE B PRODUCTS. In further
consideration for the licenses and other rights
granted to AHPC hereunder with respect to Type B
Products, AHPC shall pay to Apollo royalties in the
amount of [ * CON * ] ([ * CON * ]%) of the Net Sales
of Type B Products sold for use in the Field. In the
event that AHPC, its Affiliates or sublicensees has
been granted Regulatory Approval in any country of
the Territory to market a Type B Product for use both
in the Field and in at least one additional
therapeutic or prophylactic indication, [ * CON * ],
AHPC and Apollo shall meet to discuss the methods
proposed to be used by AHPC to determine what
proportion of such Type B Product sold in such
country(ies) was sold for use in the Field for
purposes of calculating the royalty payable
hereunder.
3.9.3 ROYALTY RATES -- TYPE C PRODUCTS. If AHPC exercises
the option granted to it under Section 2.3.1 hereof,
then in further consideration for the licenses and
other rights granted to AHPC hereunder with respect
to Type C Products, AHPC shall pay to Apollo
royalties in the amount of [ * CON * ] ([ * CON * ]%)
of the Net Sales of Type C Products sold for use in
the Field. In the event that AHPC, its Affiliates or
sublicensees has been granted Regulatory Approval in
any country of the Territory to market a Type C
Product for use both in the Field and in at least one
additional therapeutic or prophylactic indication [ *
CON * ] AHPC and Apollo shall meet to discuss the
methods proposed to be used by AHPC to determine what
proportion of such Type C Product sold in such
country(ies) was sold for use in the Field for
purposes of calculating the royalty payable
hereunder.
3.9.4 ROYALTY RATES -- TYPE D PRODUCTS. If AHPC exercises
the option granted to it under Section 2.3.2 hereof,
then in further consideration for the licenses and
other rights granted to AHPC hereunder with respect
to Type D Products, AHPC shall pay to Apollo
royalties in the amount of [ * CON * ] ([ * CON * ]%)
of the Net Sales of Type D Products sold for use in
the Field. In the event that AHPC, its Affiliates or
sublicensees has been granted Regulatory Approval in
a Major Country to market a Type D Product for use
both in the Field and in at least one additional
therapeutic or prophylactic indication [ * CON * ]
AHPC and
15
Apollo shall meet to discuss the methods proposed to
be used by AHPC to determine what proportion of such
Type D Product sold in such country(ies) was sold for
use in the Field for purposes of calculating the
royalty payable hereunder.
3.9.5 ROYALTY RATES -- TYPE E PRODUCTS. If AHPC exercises
the option granted to it under Section 2.3.3 hereof,
then in further consideration for the licenses and
other rights granted to AHPC hereunder with respect
to such Type E Products, AHPC shall pay to Apollo
royalties in the amount of [ * CON * ].
3.9.6 TERM AND SCOPE OF ROYALTY OBLIGATIONS. Royalties on
each Licensed Product sold by or on behalf of AHPC,
its Affiliates or their respective sublicensees, at
the rates set forth in this Section 3.9 shall
continue on a Licensed Product by Licensed Product
and a country-by-country basis until the expiration
of the Term of this Agreement in such country with
respect to such Licensed Product as provided in
Section 8.1 hereof. No royalties shall be due upon
the sale or other transfer among AHPC, its Affiliates
or sublicensees, but in such cases the royalty shall
be due and calculated upon AHPC's or its Affiliates'
or its sublicensees' Net Sales to the first
independent Third Party.
3.9.7 THIRD PARTY LICENSES. In the event that AHPC
determines, based on the advice of outside patent
counsel selected by AHPC and reasonably acceptable to
Apollo, that patent licenses from Third Parties
(hereinafter "Third Party Patent Licenses"), are
required by AHPC, its Affiliates and sublicensees in
order to develop, make, have made, import, export,
use, distribute, promote, market, offer for sale or
sell any Licensed Product in the Field, PROVIDED,
HOWEVER, that in the case of Type A Products, Type B
Products, Type C Products or Type D Products, such
Third Party Patents claim the use of such Licensed
Products in the Field then the royalty rates set
forth in this Section 3.9 shall be adjusted such that
the royalty which AHPC is obligated to pay Apollo
hereunder for such Licensed Product shall be reduced
by [ * CON * ] cents ($[ * CON * ]) for each [ * CON
* ] in royalties which AHPC is obligated to pay Third
Parties under Third Party Patent Licenses PROVIDED,
HOWEVER, that the royalty payable by AHPC hereunder
shall not be reduced, pursuant to this Section 3.9.7,
to less than [ * CON * ] percent ([ * CON * ]%) of
the royalty that would have otherwise been due to
Apollo hereunder in any Calendar Quarter. For
purposes of this Section 3.9.7, patent claims reading
on (i) [ * CON * ] shall not be considered to be a
claim on the use of such Licensed Products in the
Field. To the extent that AHPC is able to
16
do so without foregoing any attorney-client privilege
that AHPC may have with respect to the advice
provided by such outside patent counsel, AHPC, upon
Apollo's request, shall communicate or shall
authorize such outside patent counsel to communicate
the substance of such advice to Apollo or Apollo's
outside patent counsel, PROVIDED, HOWEVER, that AHPC
shall have no obligation whatsoever to provide Apollo
with a copy of any written opinion of such outside
patent counsel or other written communication between
AHPC and such outside patent counsel.
3.10 REPORTS AND PAYMENT OF ROYALTY.
3.10.1 ROYALTIES PAID QUARTERLY. Within sixty (60) calendar
days following the close of each Calendar Quarter,
following the First Commercial Sale of a Licensed
Product, AHPC shall furnish to Apollo a written
report for the Calendar Quarter showing, on a Product
Type by Product Type basis and, only to the extent
necessary to calculate any reductions in royalties
made pursuant to Sections 3.9.1 or 6.4.4 hereof, on a
country-by-country basis, (i) the Net Sales of Type B
Products and, if the applicable options under Section
2.3 have been exercised, Type C Products, Type D
Products and Type E Products sold by AHPC, its
Affiliates and its sublicensees in the Territory
during such Calendar Quarter, and (ii) the royalties
payable under this Agreement for such Calendar
Quarter. Simultaneously with the submission of the
written report, AHPC shall pay to Apollo, for the
account of AHPC or the applicable Affiliate or
sublicensee, as the case may be, a sum equal to the
aggregate royalty due for such Calendar Quarter
calculated in accordance with this Agreement
(reconciled for any previous overpayments,
underpayments or credits).
3.10.2 METHOD OF PAYMENT. Payments to be made by AHPC to
Apollo under this Agreement shall be paid at AHPC's
option, either by bank wire transfer in immediately
available funds to such bank account as is designated
in writing by Apollo from time to time or by check in
immediately available funds. Royalty payments shall
be made in United States dollars.
3.11 MAINTENANCE OF RECORDS; AUDITS.
3.11.1 RECORD KEEPING BY AHPC. AHPC shall keep and shall
cause its Affiliates and sublicensees to keep
accurate books and accounts of record in connection
with the sale of the Licensed Products in sufficient
detail to permit accurate determination of all
figures necessary for verification of payments
required to be paid
17
hereunder. AHPC and its Affiliates and sublicensees
shall maintain such records for a period of at least
three (3) years after the end of the year in which
they were generated.
3.11.2 AUDIT BY APOLLO. Upon forty-five (45) days prior
written notice from Apollo, AHPC shall permit an
independent certified public accounting firm of
nationally recognized standing selected by Apollo and
reasonably acceptable to AHPC, to examine, at
Apollo's sole expense, the relevant books and records
of AHPC and its Affiliates as may be reasonably
necessary to verify the accuracy of the royalty
reports and royalties paid hereunder. The examination
shall be limited to pertinent books and records for
any year ending not more than thirty-six (36) months
prior to the date of such request. An examination
under this Section 3.11.2 shall not occur more than
once in any calendar year. Such examination shall be
conducted after reasonable prior written notice to
AHPC and during ordinary business hours. The
accounting firm shall provide both Apollo and AHPC a
written report disclosing only whether the royalty
reports are correct or incorrect and the specific
details concerning any discrepancies. No other
information shall be provided to Apollo. All such
accounting firms shall sign a confidentiality
agreement (in form and substance reasonably
acceptable to AHPC) as to any of AHPC's or its
Affiliate's confidential information which they are
provided, or to which they have access, while
conducting any audit pursuant to this Section 3.11.2.
Upon the expiration of sixty (60) months following
the end of any year, the calculation of royalties
payable with respect to such year shall be binding
and conclusive upon Apollo and AHPC and its
Affiliates and sublicensees shall be released from
any liability or accountability with respect to
royalties for such year.
3.11.3 UNDERPAYMENTS/OVERPAYMENTS. If such independent
accountant correctly concludes that additional
royalties were owed during such period, AHPC shall
pay the additional royalties, together with any
interest that may be due thereon as provided in
Section 3.14, within thirty (30) days of the date
AHPC receives such accountant's written report so
concluding. If such underpayment exceeds [ * CON * ]
percent ([ * CON * ]%) of the royalty correctly due
Apollo then the reasonable fees charged by such
accountant for the work associated with the
underpayment audit shall be paid by AHPC. Any
overpayments by AHPC will be promptly refunded by
Apollo to AHPC together with interest thereon at the
rate provided in Section 3.14.
18
3.11.4 RECORD KEEPING BY SUBLICENSEE. AHPC shall include in
each sublicense granted by it pursuant to this
Agreement a provision requiring the sublicensee to
make reports to AHPC, to keep and maintain records of
sales made pursuant to such sublicense and to grant
access to such records by Apollo's independent
certified public accounting to the same extend
required of AHPC under this Agreement.
3.11.5 CONFIDENTIALITY. Apollo shall treat all financial
information subject to review under this Section
3.11, or under any sublicense agreement, in
accordance with the provisions of Article 10 hereof,
except when it is necessary to reveal such
information in order to enforce its rights under this
Agreement.
3.12 TAXES AND WITHHOLDING. All taxes, assessments and fees of any
nature levied or incurred on account of any payments from AHPC
to Apollo accruing under this Agreement, by national, state or
local governments, will be assumed and paid by AHPC, except
taxes levied thereon as income to Apollo and if such taxes are
required to be withheld by AHPC they will be deducted from
payments due to Apollo and will be timely paid by AHPC to the
proper taxing authority for the account of Apollo, a receipt
or other proof of payment therefor secured and sent to Apollo
as soon as practicable.
3.13 FOREIGN EXCHANGE. For the purpose of computing Net Sales for
Licensed Products sold in a currency other than United States
Dollars, such currency shall be converted into United States
Dollars in accordance with AHPC's customary and usual
translation procedures, consistently applied.
3.14 INTEREST. Any payment that is more than [ * CON * ] ([ * CON *
]) days past due shall thereafter be subject to interest at an
annual percentage rate of [ * CON * ] ([ * CON * ]) [ * CON *
] on the date that such interest begins to accrue.
4. PRODUCT DEVELOPMENT AND COMMERCIALIZATION.
4.1 DEVELOPMENT AND REGISTRATION OF LICENSED PRODUCTS.
4.1.1 DILIGENCE OBLIGATION. AHPC shall use its Commercially
Reasonable Efforts to develop and apply for
Regulatory Approval for at least one Licensed Product
in the Field in each of the Major Countries,
PROVIDED, HOWEVER, that the decision of whether or
not to initiate or continue the development of any
particular Product or Product Type for use in the
Field shall be in AHPC's sole discretion.
19
4.1.2 TYPE D PRODUCTS. If AHPC exercises its option under
Section 2.3.2 hereof, AHPC, notwithstanding its
obligations as set forth in Section 4.1.1 hereof,
which obligations may be met by using its
Commercially Reasonable Efforts to develop and apply
for Regulatory Approval for at least one Type D
Product in the Field in each of the Major Countries,
also shall use its Commercially Reasonable Efforts to
file an IND with respect to at least one Type D
Product prior to the later to occur of (i) the [ *
CON * ] anniversary of the Effective Date or (ii) [ *
CON * ] ([ * CON * ]) year after the payment of the
option exercise fee required under Section 3.5.2
hereof.
4.1.3 TYPE E PRODUCTS. If AHPC exercises its option under
Section 2.3.3 hereof for one or more Type E Products,
AHPC, notwithstanding its obligations as set forth in
Section 4.1.1 hereof, which obligations may be met by
using its Commercially Reasonable Efforts to develop
and apply for Regulatory Approval for at least one
Type E Product in the Field in each of the Major
Countries, also shall use its Commercially Reasonable
Efforts to file an IND with respect to at least one
Type E Product prior to the later to occur of (i) the
[ * CON * ] anniversary of the Effective Date or (ii)
[ * CON * ] ([ * CON * ]) year after the payment of
the option exercise fee required under Section 3.5.3
hereof.
4.2 EXTENSION OF TIME. Upon AHPC's request and subject to Apollo's
consent, such consent not to be unreasonably withheld or
delayed, the time periods specified in Sections 4.1.3, 4.1.4
and 4.1.5 for filing an IND for the applicable Licensed
Product shall be extended by the period of time specified in
AHPC's request, provided that AHPC is able to reasonably
demonstrate that the reason the filing of the applicable IND
was not accomplished within the time period specified in
Section 4.1.3, 4.1.4 or 4.1.5, as applicable, was not due to a
lack of Commercially Reasonable Efforts on AHPC's part and
that, due to circumstances beyond AHPC's reasonable control,
such additional time period is necessary.
4.3 COMMERCIALIZATION OF LICENSED PRODUCTS. After obtaining
Regulatory Approval for a Licensed Product, other than a Type
B Product, in a Major Country, AHPC shall use its Commercially
Reasonable Efforts to market and sell such Licensed Product in
such Major Country.
4.4 STATUS REPORTS. Within sixty (60) days after each December 31
and June 30 during the term of this Agreement AHPC shall
provide Apollo with a report summarizing the development
decisions made with respect to Licensed Products during the
period covered by the report and the then
20
current status of its Licensed Product development activities.
Such summary shall include estimated time lines for planned
future development activities for Licensed Products then under
development. Apollo acknowledges that such reports are being
provided at Apollo's request for informational purposes only
and any information or statements made therein shall not be
construed as imposing upon AHPC any specific obligations with
respect to the development of any particular Licensed Product
Apollo shall treat all such reports as Information in
accordance with Article 10 hereof. Notwithstanding the
foregoing, the first such report shall be due within sixty
(60) days after June 30, 1999.
4.5 APOLLO DEVELOPMENT AND REPORTING OBLIGATIONS.
4.5.1 DEVELOPMENT. As a fundamental condition of, and in
consideration of the payments to Apollo contemplated
by this Agreement, Apollo agrees, throughout the
Option Term, to use its Commercially Reasonable
Efforts and to apply such of its technical and
financial resources as are reasonably necessary to
establish and maintain one or more programs for the
discovery and/or development of Type E Products. Such
resources shall include, without limitation, internal
and/or external programs with scientific experts in
steroid chemistry and related analytical methods as
well as programs for specific structure/function
analysis specific to applications in the Field.
4.5.2 SCIENTIFIC REVIEW COMMITTEE; REPORTS. Promptly after
the Effective Date, the Parties will establish a
Scientific Review Committee (the "Committee")
consisting of two (2) representatives from AHPC and
two (2) representatives from Apollo. The chairperson
of such Committee shall be one of the AHPC
representatives. Either Party may replace any of its
representatives at any time upon written notice to
the other Party. The Committee shall meet in person
to review new Know-How Controlled by Apollo or its
Affiliates which relates to Type D Products and/or
Type E Products or the active ingredients thereof.
Such meetings shall occur at least two (2) times per
year (or more or less frequently as the Parties may
mutually agree in writing) during the Option Term and
a final meeting shall be held no later than thirty
(30) days after the end of the Option Term. During
such final meeting Apollo shall present and submit to
the Committee and AHPC a final written report
describing the Know-How and Apollo Patent Rights
Controlled by Apollo or its Affiliates which relates
to Type D Products and/or Type E Products or the
active ingredients thereof. The time and date of each
such meeting shall be set by mutual agreement of the
Committee members and the
21
location of such meetings shall alternate between the
facilities of Apollo and AHPC with the first such
meeting being held at one of AHPC's facilities. Each
party shall be responsible for the expenses incurred
by its representatives in attending such Committee
meetings.
5. REGULATORY MATTERS.
5.1 REGULATORY FILINGS. Subject to the obligations set forth in
Section 4.1 hereof, AHPC shall, in its own name and at its own
expense, prepare and file all INDs and all applications for
Regulatory Approval of Licensed Products for use in the Field
in those countries of the Territory where AHPC, in its sole
discretion, deems it commercially reasonable to do so. AHPC
agrees to provide Apollo with copies of correspondence with
the applicable Regulatory Authorities which correspondence
concerns the INDs permitting the study, in humans, of Type E
Products and applications for Regulatory Approval of Type E
Products. AHPC shall have no obligation to disclose to Apollo
any INDs, applications for Regulatory Approval or related
correspondence that pertains to any other Product Type.
5.2 ADVERSE EVENT REPORTING. AHPC shall be responsible for
reporting all adverse events associated with each Licensed
Product to the appropriate Regulatory Authorities in
accordance with applicable laws, rules and regulations.
Additionally, in the event Apollo receives information
regarding adverse drug experiences related to the use of any
Licensed Product, Apollo shall promptly provide AHPC with such
information in accordance with the Adverse Drug Experience
Reporting Procedures (as may be amended from time to time upon
mutual agreement) set forth in Exhibit C. Further, AHPC shall
provide Apollo with copies of any adverse drug experience
reports concerning Type E Products which reports have been
submitted by AHPC to the applicable Regulatory Authorities.
6. INTELLECTUAL PROPERTY.
6.1 FILING, PROSECUTION AND MAINTENANCE OF APOLLO PATENT RIGHTS.
Apollo agrees to use its Commercially Reasonable Efforts to
file, prosecute and maintain in the Territory, upon
appropriate consultation with AHPC, the Apollo Patent Rights
Controlled in whole or in part by Apollo and licensed to AHPC
under this Agreement. Apollo shall give AHPC an opportunity to
review the text of the applications for such Apollo Patent
Rights before filing, shall consult with AHPC with respect
thereto, and shall supply AHPC with a copy of the applications
as filed, together with notice of its filing date and serial
number. Apollo shall keep AHPC advised of the status of the
actual and prospective patent filings (including,
22
without limitation, the grant of any such Apollo Patent
Rights), and shall provide advance copies of any substantive
papers related to the filing, prosecution and maintenance of
such patent filings. AHPC acknowledges that, pursuant to the
Florida License, all final decisions with respect to the
prosecution of any of the Apollo Patent Rights which are owned
by [ * CON * ] and Controlled by Apollo by virtue of the
license granted to Apollo by [ * CON * ] under the [ * CON * ]
shall be reserved to [ * CON * ]. Notwithstanding the
foregoing, Apollo shall not be required to disclose to AHPC
any such application which claims the composition or use of a
Type E Product but does not claim or describe the composition
or use of any other Product Type, until after the first patent
application (including, without limitation, a provisional
patent application) claiming the composition or use of such
Type E Product has been filed. AHPC shall reimburse Apollo for
the reasonable out-of-pocket expenses incurred by Apollo after
the Effective Date in filing, prosecuting and maintaining the
Apollo Patent Rights owned in whole or in part by Apollo and
licensed to AHPC under this Agreement, PROVIDED, HOWEVER, that
AHPC, in its sole discretion, may elect not to pay for the
defense of an interference or other legal action relating to
such Patent Rights in the Territory. Within thirty (30) days
after the end of each calendar quarter Apollo shall invoice
AHPC for any reimbursable expenses paid by Apollo during such
calendar quarter. AHPC shall reimburse Apollo for such
expenses within thirty (30) days of AHPC's receipt of such
invoice.
6.2 OPTION OF AHPC TO PROSECUTE AND MAINTAIN APOLLO PATENT RIGHTS.
Apollo shall give one hundred and eighty (180) days written
notice to AHPC of any desire to cease prosecution and/or
maintenance of a particular Apollo Patent Right and, in such
case, shall permit AHPC, at AHPC's sole discretion, to
continue prosecution or maintenance of such Apollo Patent
Right at AHPC's own expense. If AHPC elects to continue
prosecution or maintenance of such Apollo Patent Right, Apollo
shall execute such documents and perform such acts, at
Apollo's expense, as may be reasonably necessary to effect an
assignment to AHPC of such Apollo Patent Rights which are
owned by Apollo. Any such assignment shall be completed in a
timely manner so as to allow AHPC to continue such prosecution
or maintenance. Any patents or patent applications so assigned
shall thereafter not be considered Apollo Patent Rights for
any purpose under this Agreement.
6.3 ENFORCEMENT OF APOLLO PATENT RIGHTS.
6.3.1 NOTICE AND DISCONTINUANCE OF INFRINGEMENT. In the
event that either Apollo or AHPC becomes aware of any
infringement within the Territory of any Valid Claim
within the Apollo Patent Rights, it
23
will notify the other Party in writing to that
effect. Any such notice shall include evidence to
support an allegation of infringement by such Third
Party. Apollo shall have the right, but not the
obligation to take any such action which it
reasonably deems necessary to obtain a discontinuance
of such infringement or to bring suit against the
Third Party infringer. AHPC shall have the right,
prior to commencement of the trial, suit or action
brought by Apollo, to join any such suit or action,
in which event the expenses of any such suit shall be
shared equally by Apollo and AHPC. In no event shall
Apollo enter into any settlement, consent judgment or
other voluntary final disposition of such suit which
would adversely affect AHPC's rights under this
Agreement in any way without first obtaining AHPC's
written consent to do so, which consent shall not be
unreasonably withheld. Additionally, in the event
that AHPC has joined in the action and shared in the
costs thereof as set forth above, no settlement,
consent judgment or other voluntary final disposition
of the suit may be entered into without the consent
of AHPC. In the event that AHPC has not joined the
suit or action, AHPC will reasonably cooperate with
Apollo in any such suit or action and shall have the
right to consult with Apollo and be represented by
its own counsel at its own expense. [ * CON * ] It is
understood that Apollo may share its portion of
expenses and any recovery with [ * CON * ] pursuant
to the [ * CON * ].
6.3.2 CONTINUANCE OF INFRINGEMENT. If the alleged
infringement of the Apollo Patent Rights is occurring
within the Field and, within six (6) months after
AHPC has provided Apollo with the notice specified in
the first sentence of Section 6.2.1, Apollo has not
overcome the allegation of infringement, obtained a
discontinuance of such infringement or filed suit
against such Third Party infringer, then AHPC shall
have the right, but not the obligation, to bring suit
against such Third Party infringer under the Apollo
Patent Rights and join Apollo as a party plaintiff.
Apollo will cooperate with AHPC in any suit for
infringement of an Apollo Patent Right brought by
AHPC against a Third Party, and shall have the right
to consult with AHPC and to participate in and be
represented by independent counsel in such litigation
at its own expense. If the Apollo Patent Rights that
are allegedly being infringed are Controlled by
Apollo by virtue of the license granted to Apollo by
[ * CON * ] under the [ * CON * ], AHPC shall
not enter into any settlement, consent judgment or
other voluntary final disposition of such suit
without first obtaining [ * CON * ] written consent
to do so, which consent, pursuant to the [
24
* CON * ], shall not be unreasonably withheld. Apollo
shall cooperate with AHPC in obtaining such consent.
[ * CON * ]
6.4 INFRINGEMENT OF THIRD PARTY PATENTS; THIRD PARTY LICENSES.
6.4.1 COURSE OF ACTION. In the event that AHPC's, its
Affiliates' or its sublicensees' making, having made,
importing, exporting, using, distributing, marketing,
promoting, offering for sale or selling Licensed
Products in the Field infringes, will infringe or is
alleged by a Third Party to infringe a Third Party's
patent (PROVIDED, HOWEVER, that in the case of Type A
Products, Type B Products, Type C Products and Type D
Products, such Third Party patent claims the use of
such Licensed Product in the Field) the Party
becoming aware of same shall promptly notify the
other.
6.4.2 AHPC OPTION TO NEGOTIATE. AHPC shall in the first
instance have the right to negotiate with said Third
Party for a suitable license or assignment PROVIDED,
HOWEVER, that AHPC shall enter into no such agreement
unless it has first obtained Apollo's approval (which
approval shall not be unreasonably withheld or
delayed) of any royalties or payments which are to be
deducted from payments to be made to Apollo
hereunder. In the event that such negotiation results
in a consummated agreement, then any lump sum payment
made thereunder shall be paid by AHPC and [ * CON * ]
percent ([ * CON * ]%) of such payment shall offset
any royalties due Apollo hereunder, but only to the
extent of reducing royalties due Apollo with respect
to the Product Type(s) and country(ies) affected by [
* CON * ] percent ([ * CON * ]%) in any Calendar
Quarter. Any unused amounts not so offset can be
carried over to subsequent quarters.
6.4.3 APOLLO OPTION TO NEGOTIATE. Should AHPC fail to
consummate an agreement with said Third Party within
one (1) year of initiating negotiations, then Apollo
shall have the right to negotiate with said Third
Party for a suitable license or assignment. In the
event that such negotiation results in a consummated
agreement, then any lump sum payments made thereafter
shall be paid by Apollo. Should such agreement
require the payment of royalties, AHPC shall continue
to pay the royalties due Apollo hereunder and Apollo
shall pay any royalties due said Third Party on
AHPC's behalf.
6.4.4 THIRD PARTY INFRINGEMENT SUIT. In the event that a
Third Party sues AHPC alleging that AHPC's, its
Affiliates' or its sublicensees' making, having made,
importing, exporting, using,
25
distributing, marketing, promoting, offering for sale
or selling any Licensed Product in the Field
infringes or will infringe said Third Party's patent
(PROVIDED, HOWEVER, that in the case of Type A
Products, Type B Products, Type C Products and/or
Type D Products, such Third Party patent claims the
use of such Licensed Products in the Field), then
AHPC may, in its sole discretion, elect to defend
such suit and, during the period in which such suit
is pending, AHPC shall have the right to apply [ *
CON * ] the royalties due Apollo, which royalties are
based on the allegedly infringing sales of Licensed
Product(s) against its litigation expenses, including
settlement costs and royalties paid in settlement of
any such suit, PROVIDED, HOWEVER, that in the event
that a Type A Product is the subject of such an
infringement suit, the portion of the royalties
payable under Section 3.9.1 hereof which shall be
attributable to the allegedly infringing sales of
such Licensed Product for purposes of calculating the
amount of royalties payable in any Calendar Quarter
that may be attributed to litigation expenses under
this Section 6.4.4. shall be calculated by
multiplying the royalty amount set forth in Section
3.9.1(a), 3.9.1(b) or 3.9.1(c), as applicable, by a
factor equal to [ * CON * ], where [ * CON * ] is the
sum of AHPC's, its Affiliates' and its sublicensees'
Net Sales made during such Calendar Quarter of Type A
Products in the country(ies) where the infringement
is alleged to be taking place and [ * CON * ] is the
sum of AHPC's, its Affiliates' and its sublicensees'
worldwide Net Sales of Type A Products during such
Calendar Quarter. Upon AHPC's request and in
connection with AHPC's defense of any such Third
Party infringement suit, Apollo shall provide
reasonable assistance to AHPC for such defense. For
purposes of this Section 6.4.4, patent claims reading
on (i) the composition of Type A Products, Type B
Products, Type C Products and/or Type D Products,
(ii) processes for manufacturing such Licensed
Products and/or drug delivery systems used by AHPC in
connection with such Licensed Products shall not be
considered not be considered to be a claim on the use
of such Licensed Products in the Field. Should AHPC
recovery any damages, by way of settlement or
otherwise, in connection with any counterclaim made
by it in any such Third Party infringement suit, such
recovery shall be used first to reimburse AHPC for
the costs and expenses it incurred in defending such
Third Party infringement suit (including, without
limitation, the costs and expenses incurred in
pursuing any counterclaims in such suit) and second
to reimburse Apollo for any royalties withheld
pursuant to this Section 6.4.4. Any remaining amounts
from such recovery shall be shared pro rata by the
Parties, based on the
26
portion of the expenses paid by each Party in
defending such suit and prosecuting such
counterclaims.
6.5 CERTIFICATION UNDER DRUG PRICE COMPETITION AND PATENT
RESTORATION ACT. Apollo and AHPC each shall immediately give
written notice to the other of any certification of which they
become aware filed pursuant to 21 U.S.C. Section 355(b)(2)(A)
(or any amendment or successor statute thereto) claiming that
Apollo Patent Rights covering any Licensed Product or the use
of any Licensed Product in the Field are invalid or that
infringement will not arise from the manufacture, use or sale
of Licensed Product(s) by a Third Party. Notwithstanding any
provision to the contrary, in the event that Apollo has failed
to bring an infringement action against such Third Party at
least fourteen (14) days prior to expiration of the forty five
(45) day period set forth in 21 U.S.C. Section 355(c)(3)(C)
(or any amendment or successor statute thereto), AHPC shall
have the right to bring such an infringement action, in its
sole discretion and at its own expense, in its own name and/or
in the name of Apollo. At AHPC's request, Apollo shall provide
AHPC reasonable assistance to conduct such infringement
action, including, without limitation, causing the execution
of such legal documents as AHPC may deem necessary for the
prosecution of such action. AHPC shall periodically reimburse
Apollo for its out-of-pocket costs (excluding any of Apollo's
costs of retaining independent counsel) incurred in assisting
AHPC. AHPC shall incur no liability to Apollo as a consequence
of such litigation or any unfavorable decision resulting
therefrom, including any decision holding any of the Apollo
Patent Rights invalid or unenforceable. In the event that AHPC
recovers any sums in such litigation by way of damages or in
settlement thereof, AHPC shall have the right to retain all
such sums to offset its costs, losses and expenses.
6.6 ABANDONMENT. Subject to AHPC's rights pursuant to Section 6.2,
Apollo shall at the earliest known date give notice to AHPC of
the grant, lapse, revocation, surrender, invalidation of
abandonment of any Apollo Patent Rights licensed to AHPC for
which Apollo is responsible for the filing, prosecution and
maintenance under this Agreement.
6.7 PATENT TERM RESTORATION. Apollo shall have the right, in the
first instance, to determine whether to seek patent term
restoration (or its equivalent) with respect to any Apollo
Patent Right and shall notify AHPC, in writing, as to whether
or not Apollo has elected to seek such patent term restoration
(or its equivalent), provided, however, that in the event
Apollo has elected not to seek such patent term restoration
(or its equivalent), such written notice must be delivered to
AHPC no later than ninety (90) days prior to the date that any
action must be taken in order to
27
preserve the ability to obtain such a patent term restoration
(or its equivalent). In the event that Apollo elects not to
seek patent term restoration (or its equivalent) with respect
to any Apollo Patent Right, AHPC shall have the right, but not
the obligation, to seek patent term restoration (or its
equivalent) for such Apollo Patent Right at its own expense,
PROVIDED, HOWEVER, that if AHPC does elect to seek such patent
term restoration (or its equivalent) with respect to such
Apollo Patent Right as permitted by this sentence, then, as of
the date such Apollo Patent Right would have otherwise expired
but for AHPC seeking such patent term restoration (or its
equivalent) such Apollo Patent Right shall no longer be
included within the definition of the Apollo Patent Rights
hereunder solely for the purpose of calculating royalties
payable under Section 3.9 hereof, but not for any other
purpose. In the event that either Party elects to seek patent
term restoration (or its equivalent) for any Apollo Patent
Right as provided in this Section 6.7, the Parties shall
cooperate with each other in obtaining such patent term
restoration (or its equivalent) which cooperation shall
include, without limitation, executing those documents that
may be necessary for either Party to seek and obtain such
patent term restoration (or its equivalent).
6.8 NOTICES REGARDING PATENTS. All notices, inquiries and
communications in connection with this Article IV shall be
sent in the manner set forth in Section 13.7 to the Parties at
the addresses and facsimile numbers indicated below.
If to Apollo: Apollo BioPharmaceutics, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn.: President
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to: ▇▇▇▇▇▇ & Dodge
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn.: [ * CON * ]
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to AHPC: American Home Products Corporation
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attn.: Senior Vice President
Patent and Trademark Department
28
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
7. REPRESENTATIONS AND WARRANTIES.
7.1 REPRESENTATIONS AND WARRANTIES OF BOTH PARTIES. As of the
Effective Date, each of Apollo and AHPC hereby represents,
warrants and covenants to the other Party hereto as follows:
(a) it is a corporation or entity duly organized and
validly existing under the laws of the state or other
jurisdiction of incorporation or formation;
(b) the execution, delivery and performance of this
Agreement by such Party has been duly authorized by
all requisite corporate action and do not require any
shareholder action or approval;
(c) it has the power and authority to execute and deliver
this Agreement and to perform its obligations
hereunder;
(d) the execution, delivery and performance by such Party
of this Agreement and its compliance with the terms
and provisions hereof does not and will not conflict
with or result in a breach of any of the terms and
provisions of or constitute a default under (i) a
loan agreement, guaranty, financing agreement,
agreement affecting a product or other agreement or
instrument binding or affecting it or its property;
(ii) the provisions of its charter or operative
documents or bylaws; or (iii) any order, writ,
injunction or decree of any court or governmental
authority entered against it or by which any of its
property is bound; and
(e) it shall at all times comply with all applicable
material laws and regulations relating to its
activities under this Agreement, including, without
limitation, for all patent applications and patents
claiming inventions that are subject inventions (as
such term is defined in 37 CFR Section 401) of a
funding agreement between an agency of the united
States Government and [ * CON * ] or the [ * CON * ],
all rights and limitations of U.S. Code Title 35,
Chapter 38, and the implementing regulations thereof.
7.2 REPRESENTATIONS AND WARRANTIES OF APOLLO. In addition to the
representations and warranties made by Apollo under Section
7.1 hereof, Apollo hereby represents and warrants to AHPC
that:
29
(a) it has the full right, power and authority to grant
the licenses and options granted to AHPC under
Article 2 hereof;
(b) all inventors (who are known as of the Effective
Date) of any inventions included within the Apollo
Patent Rights and the Know-How have assigned their
entire right, title and interest in and to such
inventions and the Apollo Patent Rights either to
Apollo or to the Third Party from whom Apollo has
obtained a license whereby Apollo Controls such
inventions or Apollo Patent Rights and, to the best
of Apollo's knowledge, such knowledge being
developed, at least in part, by due investigation by
Apollo, no person, other than those persons named as
inventors on any patent or patent application
included within the Apollo Patent Rights, is an
inventor of the invention(s) claimed in such patent
or patent application;
(c) to the best of Apollo's knowledge, such knowledge
being developed, at least in part, by due
investigation by Apollo, the [ * CON * ] has (i)
complied with all of its obligations under applicable
United States Government laws and regulations with
respect to any inventions included within the Apollo
Patent Rights or the Know-How which inventions are
subject inventions of a funding agreement with the
United States Government or any agency thereof and
(ii) elected to retain title to any such invention as
provided in 37 CFR Part 401.
(d) all Apollo Patent Rights that are existing as of the
Effective Date are listed on Exhibit A attached
hereto and to the best of Apollo's knowledge all such
Apollo Patent Rights are not invalid or
unenforceable, in whole or in part;
(e) except as described in Section 7.4 hereof, it has
not, prior to the Effective Date, previously
assigned, transferred, conveyed or otherwise
encumbered its right, title and interest in any of
the Apollo Patent Rights or the Know-How;
(f) as of the Effective Date, there are no claims,
judgments or settlements against or owed by Apollo
or, to the best of its knowledge, pending or
threatened claims or litigation relating to the
Apollo Patent Rights or the Know-How and during the
term of this Agreement Apollo shall promptly notify
AHPC, in writing, upon learning of any such actual or
threatened claim, judgment or settlement;
(g) during the Term of this Agreement it will use
diligent efforts not to diminish the rights under the
Apollo Patent Rights or the Know-
30
How including, without limitation, by not committing
or permitting any actions or omissions which would
cause the breach of any agreements between itself and
Third Parties which provide for intellectual property
rights applicable to the development, manufacture,
use or sale of Licensed Products in the Field, and
that it will provide AHPC promptly with notice of any
such alleged breach, and that, as of the Effective
Date, it is in compliance in all material respects
with any agreements with Third Parties relating to
the Apollo Patent Rights and the Know-How;
(h) as of the Effective Date, there are no collaborative,
licensing, material transfer, supply, distributorship
or marketing agreements or arrangements or other
similar agreements to which it or any of its
Affiliates is a party relating to the Apollo Patent
Rights, the Know-How or any Product, which agreements
are inconsistent with AHPC's rights hereunder;
(i) it has not granted any rights to any Third Party with
respect to the Apollo Patent Rights, the Know-How or
any Product, which grant of rights would be
inconsistent with the rights granted to AHPC
hereunder; and
(j) it has no knowledge of any material information,
other than information provided to AHPC in writing
prior to the signing of this Agreement, which would
negatively affect the ability of AHPC to obtain
Regulatory Approval for the use of any Licensed
Product in the Field or which would negatively affect
the timing for obtaining such Regulatory Approval.
7.3 REPRESENTATION BY LEGAL COUNSEL. Each Party hereto represents
that it has been represented by legal counsel in connection
with this Agreement and acknowledges that it has participated
in the drafting hereof. In interpreting and applying the terms
and provisions of this Agreement, the Parties agree that no
presumption shall exist or be implied against the Party which
drafted such terms and provisions.
7.4 PRIOR AGREEMENTS. Apollo had previously entered into
agreements with [ * CON * ] relating to all or part of the
Apollo Patent Rights and/or the Know-How. Additionally, Apollo
had previously entered into an agreement with [ * CON * ]
pursuant to which Apollo agreed, INTER ALIA, to pay to [ * CON
* ] a royalty based, in part, on payments Apollo receives from
licensing or otherwise transferring to other parties all or
part of the Apollo Patent Rights and/or Know-How. Apollo
represents and warrants to AHPC that the agreement with [ *
CON * ] including, without limitation, [ * CON * ], each have
no further right, title, interest or claim
31
in or to any Apollo Patent Right, the Know-How or any Licensed
Product. Apollo also represents and warrants to AHPC that the
agreement with [ * CON * ] other than Apollo, each have no
further right, title, interest or claim in or to any Apollo
Patent Right, the Know-How or any Licensed Product. Apollo
further represents and warrants to AHPC that, except for the
specific right to receive payments from Apollo in connection
with the Apollo Patent Rights, the Know-How and the Licensed
Products, [ * CON * ] has no other right, title, interest or
claim in or to any Apollo Patent Right, the Know-How or any
Licensed Product.
7.5 APOLLO DISCLAIMER. APOLLO MAKES NO REPRESENTATION OR WARRANTY,
EITHER EXPRESS OR IMPLIED, THAT ANY MEHODS DESCRIBED IN THE
APOLLO PATENT RIGHTS OR KNOW-HOW WILL BE EFFECTIVE OR THAT ANY
OF THE LICENSED PRODUCTS WILL BE MERCHANTIBLE OR FIT FOR A
PARTICULAR PURPOSE.
8. TERM AND TERMINATION.
8.1 TERM AND EXPIRATION. This Agreement shall be effective as of
the Effective Date and unless terminated earlier by mutual
written agreement of the Parties or pursuant to Sections 8.2
or 8.3 below, the Term of this Agreement shall continue, on a
country-by-country and Licensed Product-by-Licensed Product
basis, in effect until expiration of the last to expire Patent
Right in such country incorporating a Valid Claim which
encompasses the composition or use of such Licensed Product in
the Field. Upon expiration of this Agreement AHPC's license to
use the Know-How pursuant to Section 2.1 hereof shall become a
fully paid-up, perpetual, irrevocable license.
8.2 TERMINATION BY AHPC. AHPC may terminate this Agreement on a
Licensed Product by Licensed Product and on a country by
country basis at any time upon ninety (90) days prior written
notice to Apollo, provided, however that if AHPC elects to
terminate its rights and obligations under this Agreement with
respect to a Licensed Product in a Major Country, which
Licensed Product is then being marketed by AHPC, its
Affiliates or sublicensees in such Major Country, the notice
period set forth above in this Section 8.2 shall be extended
to three hundred sixty (360) days. Notwithstanding the
foregoing, in the event that AHPC learns of a lack of
efficacy, safety concerns or adverse regulatory actions
associated with such Licensed Product, AHPC may terminate this
Agreement with respect to such Licensed Product on a country
by country basis upon immediate written notice to Apollo.
8.3 TERMINATION BY APOLLO FOR LACK OF DILIGENCE.
32
8.3.1 FAILURE TO USE COMMERCIALLY REASONABLE EFFORTS. If,
after the [ * CON * ] anniversary of the Effective
Date, AHPC commits a material breach of its
obligations under Section 4.1.1 hereof, and, after
the Parties have attempted to resolve any dispute
relating to such alleged breach, in good faith, in
accordance with the dispute resolution process set
forth in Section 11.7 hereof, AHPC, within ninety
(90) days after the date such dispute resolution
process is to be complete as provided in Section 11.7
hereof, fails to commence using Commercially
Reasonable Efforts to develop and apply for
Regulatory Approval for [ * CON * ] as required in
Section 4.1.1 hereof, , Apollo, as its sole and
exclusive remedy, may, upon thirty (30) days prior
written notice to AHPC, terminate this Agreement in
its entirety.
8.3.2 FAILURE TO FILE IND. In the event that AHPC has
exercised one or more of its options under Section
2.3 hereof and has failed to use its Commercially
Reasonable Efforts to file an IND for [ * CON * ]
within the time periods specified in either Section
4.1.2 or 4.1.3 , as applicable and as may be extended
pursuant to Section 4.2 hereof, Apollo may, as its
sole and exclusive remedy, terminate AHPC's license
under this Agreement with respect to such Product
Type by providing to AHPC, within sixty (60) days
after the expiration of the applicable time period
and any extensions thereof, written notice of such
termination.
8.4 TERMINATION FOR CAUSE. Either Party may terminate this
Agreement with respect to a particular Product Type upon
written notice provided to the other Party at any time during
the Term :
(a) if the other Party commits a material breach
of its obligations, other than AHPC's
obligations under Section 4.1.1 hereof,
relating to such Product Type under this
Agreement, and, after the Parties have
attempted to resolve any dispute relating to
such alleged breach, in good faith, in
accordance with the dispute resolution
process set forth in Section 11.7 hereof,
such breach remains uncured for ninety (90)
days measured from the date such dispute
resolution process is to be complete as
provided in Section 11.7 hereof, PROVIDED,
HOWEVER, that if such breach is not
susceptible of cure within such ninety (90)
day period and the breaching Party uses
diligent good faith efforts to cure such
breach, such ninety (90) day period shall be
extended to one hundred eighty (180) days;
or
33
(b) upon the filing or institution of
bankruptcy, reorganization, liquidation or
receivership proceedings, or upon an
assignment of a substantial portion of the
assets for the benefit of creditors by the
other Party, or in the event a receiver or
custodian is appointed for such Party's
business, or if a substantial portion of
such Party's business is subject to
attachment or similar process; PROVIDED,
HOWEVER, that in the case of any involuntary
bankruptcy proceeding such right to
terminate shall only become effective if the
proceeding is not dismissed within sixty
(60) days after the filing thereof.
8.5 EFFECT OF TERMINATION.
8.5.1 TERMINATION BY AHPC. In the event AHPC terminates
this Agreement under Section 8.4(a), AHPC's licenses
pursuant to Sections 2.1 and 2.2 with respect to the
Product Type as to which the breach relates shall
become fully paid-up, perpetual, irrevocable
licenses, PROVIDED, HOWEVER, with respect to any of
the said licenses granted to AHPC herein pursuant to
any Apollo Patent Right that is Controlled by Apollo
by virtue of the license granted by [ * CON * ] AHPC
shall, upon conversion of this license to a direct
license with [ * CON * ] pursuant to Section 2.5
hereof, become obligated to pay to [ * CON * ] the
portion of the license fees and royalties that Apollo
would have received from AHPC and would have been
obligated to pay, but had not yet paid, to [ * CON *
] pursuant to [ * CON * ] had this Agreement not been
so terminated.
8.5.2 TERMINATION BY APOLLO.
(a) In the event that Apollo terminates this
Agreement with respect to one or more
Product Type(s) under either Section 8.3.1
or 8.4(a) hereof, then the rights and
licenses granted to AHPC under Section 2.1
of this Agreement with respect to such
Product Type(s) shall terminate and all
rights to the Apollo Patent Rights and
Apollo Know-How with respect to Licensed
Products included within such Product
Type(s) shall revert to Apollo.
(b) In the event that Apollo terminates this
Agreement with respect to one or more
Product Type(s) under Section 8.3.2 hereof,
then the rights and licenses granted to AHPC
under Section 2.1 of this Agreement with
respect to such Product
34
Type(s) shall terminate and all rights to
the Apollo Patent Rights and Apollo Know-How
with respect to Licensed Products included
within such Product Type(s) shall revert to
Apollo. Additionally, in the event Apollo
has terminated this Agreement under either
Section 8.3.2 or Section 8.4(a) hereof with
respect to Type D Products or Type E
Products, AHPC shall provide Apollo with and
Apollo shall have the right to use any
preclinical or clinical test data that AHPC
has generated with respect to such Licensed
Products and AHPC will assign to Apollo all
Regulatory Approvals and applications for
Regulatory Approval for such Licensed
Products, PROVIDED, HOWEVER, that AHPC SHALL
PROVIDE NO REPRESENTATION OR WARRANTY OF ANY
KIND, EXPRESS OR IMPLIED, INCLUDING, WITHOUT
LIMITATION WARRANTIES OF MERCHANTABILITY AND
FITNESS FOR A PARTICULAR PURPOSE, WITH
RESPECT TO SUCH TEST DATA, REGULATORY
APPROVALS OR APPLICATIONS FOR REGULATORY
APPROVAL AND APOLLO'S USE OF ANY SUCH TEST
DATA, REGULATORY APPROVALS, AND APPLICATIONS
FOR REGULATORY APPROVAL SHALL BE AT APOLLO'S
SOLE RISK.
8.5.3 EFFECT OF BANKRUPTCY. In the event AHPC terminates
this Agreement under Section 8.4(b) or this Agreement
is otherwise terminated under Section 8.4(b), the
Parties agree that AHPC, as a licensee of rights to
intellectual property under this Agreement, shall
retain and may fully exercise all of its rights and
elections under Title 11, including as set forth in
Section 11.8 hereof.
8.6 SURVIVAL OF OBLIGATIONS. Expiration or termination of the
Agreement shall not relieve the Parties of any obligation
accruing prior to such expiration or termination, and the
provisions of Articles 9 and 10 and Sections 3.11, 5.2 and
11.6 shall survive the expiration or any termination of the
Agreement. Except as otherwise expressly provided herein, any
expiration or early termination of this Agreement shall be
without prejudice to the rights of either Party against the
other accrued or accruing under this Agreement prior to
termination, including the obligation to pay royalties for
Licensed Product(s) sold prior to such termination.
9. INDEMNIFICATION AND INSURANCE.
9.1 INDEMNIFICATION BY AHPC. AHPC shall indemnify, defend and hold
harmless (i) Apollo and its Affiliates, and each of its and
their respective
35
employees, officers, directors and agents and (ii) [ * CON *
], and those inventors of any Apollo Patent Right which is
Controlled by Apollo by virtue of the license granted to it by
[ * CON * ] which inventors were employees of [ * CON * ] at
the time the inventions claimed in such Apollo Patent Rights
were made and have assigned their entire right, title and
interest in and to such Apollo Patent Rights to [ * CON * ]
(each of (i) and (ii), an "Apollo Indemnified Party") from and
against any and all liability, loss, damage, cost, and expense
(including reasonable attorneys' fees) to any Third Party
(collectively, a "Liability") which the Apollo Indemnified
Party may incur, suffer or be required to pay resulting from
or arising in connection with (i) the breach by AHPC of any
representation or warranty contained in Article 7 of this
Agreement; (ii) the manufacture, use or sale of Licensed
Products by AHPC; or (iii) the successful enforcement by an
Apollo Indemnified Party of its rights under this Section 9.1.
Notwithstanding the foregoing, AHPC shall have no obligation
under this Agreement to indemnify, defend or hold harmless any
Apollo Indemnified Party with respect to claims, demands,
costs or judgments which result from willful misconduct or
negligent acts or omissions of any Apollo Indemnified Party.
9.2 INDEMNIFICATION BY APOLLO. Apollo shall indemnify, defend and
hold harmless AHPC and its Affiliates, and each of its and
their respective employees, officers, directors and agents
(each, an "AHPC Indemnified Party") from and against any
Liability which the AHPC Indemnified Party may incur, suffer
or be required to pay resulting from or arising in connection
with (i) the breach by Apollo of any representation or
warranty contained in Article 7 of this Agreement; (ii) any
negligent act or omission or intentional misconduct by Apollo
or any of its Affiliates in performing any of its obligations
hereunder; or (iii) the successful enforcement by an AHPC
Indemnified Party of its rights under this Section 9.2.
Notwithstanding the foregoing, Apollo shall have no obligation
under this Agreement to indemnify, defend, or hold harmless
any AHPC Indemnified Party with respect to claims, demands,
costs or judgments which result from willful misconduct or
negligent acts or omissions of AHPC, its Affiliates, or any of
their respective employees, officers, directors or agents.
9.3 CONDITIONS TO INDEMNIFICATION. The obligations of the
indemnifying Party under Sections 9.1 and 9.2 are conditioned
upon the delivery of written notice to the indemnifying Party
of any potential Liability promptly after the indemnified
Party becomes aware of such potential Liability. The
indemnifying Party shall have the right to assume the defense
of any suit or claim related to the Liability if it has
assumed responsibility for the suit or claim in writing;
however, if in the reasonable judgment of the
36
indemnified Party, such suit or claim involves an issue or
matter which could have a materially adverse effect on the
business operations or assets of the indemnified Party, the
indemnified Party may waive its rights to indemnity under this
Agreement and control the defense or settlement thereof, but
in no event shall any such waiver be construed as a waiver of
any indemnification rights such Party may have at law or in
equity. If the indemnifying Party defends the suit or claim,
the indemnified Party may participate in (but not control) the
defense thereof at its sole cost and expense.
9.4 SETTLEMENTS. Neither Party may settle a claim or action
related to a Liability without the consent of the other Party,
if such settlement would impose any monetary obligation on the
other Party or require the other Party to submit to an
injunction or otherwise limit the other Party's rights under
this Agreement. Any payment made by a Party to settle any such
claim or action shall be at its own cost and expense.
9.5 LIMITATION OF LIABILITY. With respect to any claim by one
Party against the other arising out of the performance or
failure of performance of the other Party under this
Agreement, the Parties expressly agree that the liability of
such Party to the other Party for such breach shall be limited
under this Agreement or otherwise at law or equity to direct
damages only and in no event shall a Party be liable for,
punitive, exemplary or consequential damages. The limitations
set forth in this Section 8.5 shall not apply with respect to
the obligations of either Party to indemnify the other under
Sections 8.2 or 8.3 hereof in connection with a Liability to a
Third Party.
9.6 INSURANCE. Apollo shall obtain and maintain at all times
during the term of this Agreement, Commercial General
Liability Insurance, including contractual liability coverage,
with reputable and financially secure insurance carriers, with
limits of not less than [ * CON * ] dollars ($[ * CON * ]) per
occurrence and in the aggregate. Additionally, if AHPC
exercises its option(s) under either Section 2.3.2 (with
respect to Type D Products) or 2.3.3 hereof (with respect to
Type E Products), at the earlier of (i) such time as human
clinical trials are initiated by or on behalf of AHPC for any
Type D Product or Type E Product, as applicable, or (ii) the
first Regulatory Approval is obtained for such a Type D
Product or Type E Product, as applicable, Apollo also shall
obtain and thereafter maintain Product Liability Insurance,
with reputable and financially secure insurance carriers, such
that the limits of Apollo's Commercial General Liability
Insurance, including Products Liability Insurance, are not
less than [ * CON * ] dollars ($[ * CON * ]) per occurrence
and in the aggregate. Apollo agrees that each such insurance
policy shall name
37
AHPC as an additional insured and shall contain a provision
requiring ten (10) day advance notification to AHPC in the
event of its cancellation or termination. Within thirty (30)
days after obtaining each such insurance policy as required
under this Section 9.6, Apollo shall provide to AHPC a
certificate of insurance or other evidence (reasonably
acceptable to AHPC) of such insurance.
10. CONFIDENTIALITY.
10.1 NONDISCLOSURE OBLIGATION. Each of Apollo and AHPC shall use
only in accordance with this Agreement and shall not disclose
to any Third Party any information including, without
limitation, Know-How, received by it from the other Party (the
"Information"), without the prior written consent of the other
Party. The foregoing obligations shall survive the expiration
or earlier termination of this Agreement for a period of [ *
CON * ] ([ * CON * ]) years. These obligations shall not apply
to Information that:
(i) is known by the receiving Party at the time
of its receipt, and not through a prior
disclosure by the disclosing Party, as
documented by business records;
(ii) is at the time of disclosure or thereafter
becomes published or otherwise part of the
public domain without breach of this
Agreement by the receiving Party;
(iii) is subsequently disclosed to the receiving
Party by a Third Party who has the right to
make such disclosure;
(iv) is developed by the receiving Party
independently of the Information received
from the disclosing Party and such
independent development can be documented by
the receiving Party; or
(v) is required by law, regulation, rule, act or
order of any governmental authority or
agency to be disclosed by a Party, PROVIDED
that notice is promptly delivered to the
other Party in order to provide an
opportunity to seek a protective order or
other similar order with respect to such
Information and thereafter the disclosing
Party discloses to the requesting entity
only the minimum Information required to be
disclosed in order to comply with the
request, whether or not a protective order
or other similar order is obtained by the
other Party.
38
10.2 PERMITTED DISCLOSURES. Information may be disclosed to
employees or consultants of the receiving Party and, in the
case of AHPC, AHPC's Affiliates, but, in each case, only to
the extent required to accomplish the purposes of this
Agreement and only if the receiving Party obtains prior
agreement from such employees and consultants to hold in
confidence and not make use of such Information for any
purpose other than those permitted by this Agreement. Each
Party will use at least the same standard of care as it uses
to protect proprietary or confidential information of its own
to ensure that such employees, agents, consultants,
sublicensees or suppliers do not disclose or make any
unauthorized use of the Information.
10.3 RETURN OF INFORMATION. If this Agreement is terminated for any
reason, then each Party, upon the request of the other Party,
shall return to such other Party all copies of Information
received from such other Party hereunder, provided, however,
that each Party's legal counsel may retain one copy of such
Information in a secure location solely for purposes of
determining such Party's continuing obligations hereunder.
10.4 DISCLOSURE OF AGREEMENT. Neither Apollo nor AHPC shall release
to any Third Party or publish in any way any non-public
information with respect to the terms of this Agreement or
concerning their cooperation without the prior written consent
of the other, which consent will not be unreasonably withheld
or delayed, provided, however, that either Party may disclose
the terms of this Agreement to the extent required to comply
with applicable laws, including without limitation the rules
and regulations promulgated by the United States Securities
and Exchange Commission and the Party intending to disclose
the terms of this Agreement shall provide the nondisclosing
Party an opportunity to review and comment on the intended
disclosure which is reasonable under the circumstances.
Notwithstanding the foregoing, Apollo, to the extent required
by [ * CON * ], may provide, to [ * CON * ] copies of the
royalty reports submitted by AHPC to Apollo under Section
3.10.1 hereof, provided, however, that in so disclosing such
reports to [ * CON * ] Apollo takes all reasonable actions
that are necessary to ensure that [ * CON * ] maintains the
confidentiality of such reports and all information contained
therein and does not disclose such reports or any information
contained therein to any Third Party or use such reports or
any information contained therein for any purpose other than
verifying the amount of royalties or other fees that are due
from Apollo to [ * CON * ] pursuant to the [ * CON * ].
10.5 PUBLICITY. Subject to Section 10.4, all publicity, press
releases and other announcements relating to this Agreement or
the transactions contemplated hereby shall be reviewed in
advance by, and shall be subject
39
to the approval of, both Parties, which approval shall not be
unreasonably withheld or delayed.
11. MISCELLANEOUS.
11.1 FORCE MAJEURE. Neither Party shall be liable to the other for
delay or failure in the performance of the obligations on its
part contained in this Agreement if and to the extent that
such failure or delay is due to circumstances beyond its
control. It shall notify the other Party promptly should such
circumstances arise, giving an indication of the likely extent
and duration thereof, and shall use all Commercially
Reasonable Efforts to resume performance of its obligations as
soon as practicable.
11.2 ASSIGNMENT.
11.2.1 ASSIGNMENT BY APOLLO. Apollo shall not assign this
Agreement or any of its rights or obligations
hereunder to any Third Party without the prior
written consent of AHPC, which consent may be
provided or withheld in AHPC's sole discretion.
Notwithstanding, the foregoing, subject to the prior
written consent of AHPC, which consent shall not be
unreasonably withheld, Apollo may assign this
Agreement or any of its rights or obligations
hereunder to any of its Affiliates, for so long as
they remain Affiliates; provided, however, that such
assignment shall not relieve Apollo of its
responsibilities for performance of its obligations
under this Agreement. Additionally, AHPC's consent
shall not be required in the event that Apollo
assigns this Agreement to a Third Party as a part of
a merger of Apollo, with or the sale of all of
Apollo's assets to such Third Party, provided,
however, that (i) within ten (10) days of signing an
agreement for such merger or sale, Apollo shall
provide AHPC with written notice thereof, specifying
to whom this Agreement is to be assigned and when
such assignment is to become effective and (ii) on
the effective date of such assignment, such Third
Party delivers to AHPC a signed agreement assuming
all of Apollo' obligations under this Agreement.
11.2.2 ASSIGNMENT BY AHPC. AHPC may assign this Agreement
and/or any of its rights or obligations hereunder to
any of its Affiliates or to any Third Party;
provided, that in the event of such an assignment, no
intellectual property rights of the assignee shall be
included in the technology to be licensed to Apollo
upon Apollo's exercise of its option hereunder. AHPC
shall promptly provide Apollo with written notice of
any such assignment.
40
11.2.3 BINDING NATURE OF ASSIGNMENT. This Agreement shall be
binding upon and inure to the benefit of the
successors and permitted assigns of the Parties. Any
assignment not in accordance with this Section 11.2
shall be void.
11.3 NO WAIVER. The failure of either Party to require performance
by the other Party of any of that other Party's obligations
hereunder shall in no manner affect the right of such Party to
enforce the same at a later time. No waiver by any Party
hereto of any condition, or of the breach of any provision,
term, representation or warranty contained in this Agreement,
whether by conduct or otherwise, in any one or more instances,
shall be deemed to be or construed as a further or continuing
waiver of any such condition or breach, or of any other
condition or of the breach of any other provision, term,
representation or warranty hereof.
11.4 SEVERABILITY. If a court or other tribunal of competent
jurisdiction should hold any term or provision of this
Agreement to be excessive, or invalid, void or unenforceable,
the offending term or provision shall be deleted or revised to
the extent necessary to be enforceable, and, if possible,
replaced by a term or provision which, so far as practicable
achieves the legitimate aims of the Parties.
11.5 RELATIONSHIP BETWEEN THE PARTIES. Both Parties are independent
contractors under this Agreement. Nothing herein contained
shall be deemed to create an employment, agency, joint venture
or partnership relationship between the Parties hereto or any
of their agents or employees, or any other legal arrangement
that would impose liability upon one Party for the act or
failure to act of the other Party. Neither Party shall have
any express or implied power to enter into any contracts or
commitments or to incur any liabilities in the name of, or on
behalf of, the other Party, or to bind the other Party in any
respect whatsoever.
11.6 CORRESPONDENCE AND NOTICES.
11.6.1 ORDINARY NOTICES. Correspondence, reports,
documentation, and any other communication in writing
between the Parties in the course of ordinary
implementation of this Agreement shall be delivered
by hand, sent by facsimile, or by airmail to the
employee or representative of the other Party who is
designated by such other Party to receive such
written communication.
11.6.2 EXTRAORDINARY NOTICES. Extraordinary notices and
communications (including, without limitation,
Apollo' exercise of its option, notices of
termination, force majeure, material breach, change
of address) shall be in writing and delivered by hand
or sent
41
by nationally recognized overnight delivery service,
prepaid registered or certified air mail, or by
facsimile confirmed by prepaid first class,
registered or certified mail letter, and shall be
deemed to have been properly served to the addressee
upon receipt of such written communication.
11.6.3 ADDRESSES. In the case of Apollo, the proper address
for communications shall be:
Apollo BioPharmaceutics, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: President
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to: ▇▇▇▇▇▇ & Dodge
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: [ * CON * ]
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
and it the case of AHPC, the proper address for
communications and for all payments shall be:
Wyeth-Ayerst Laboratories
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Senior Vice President,
Global Business Development
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
American Home Products Corporation
▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Senior Vice President and
General Counsel
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
11.7 CHOICE OF LAW; DISPUTE RESOLUTION. This Agreement is subject
to and governed by the laws of the State of Delaware,
excluding its conflict of laws provisions. The Parties
recognize that a bona fide dispute as to certain matters may
from time to time arise during the term of this Agreement. In
the event of the occurrence of such a dispute either Party
42
may, by written notice to the other Party (which notice shall
specify, without limitation, the particulars of the dispute
and the relevant provisions of this Agreement relating to such
dispute), have such dispute referred to their respective
officers (designated below) or their successors for attempted
resolution by good faith negotiations within thirty (30)
calendar days after such notice is received. Said designated
officers are as follows:
For AHPC: Senior Vice President
Global Business Development
Wyeth-Ayerst Laboratories
For Apollo: Vice President, Business Development
Apollo BioPharmaceutics, Inc.
In the event the designated officers are not able to
resolve such dispute through good faith negotiations within
such thirty (30) calendar day period, the dispute shall then
be referred to their respective officers (designated below) or
their successors for attempted resolution by good faith
negotiations within thirty (30) calendar days after the end of
the thirty (30) day period described above. Said designated
officers are as follows:
If the dispute relates to a scientific or development
matter:
For AHPC: President
Wyeth-Ayerst Research
For Apollo: President
Apollo BioPharmaceutics, Inc.
If the dispute relates to a commercial or business
matter:
For AHPC: Executive Vice President
American Home Products Corporation
For Apollo: President
Apollo BioPharmaceutics, Inc.
In the event the designated officers are not able to resolve
such dispute through good faith negotiations within such
thirty (30) calendar day period, either Party may pursue any
legal or equitable remedies available to it by filing a claim
in the state or federal courts of the state of Delaware and
each Party hereby consents to the jurisdiction of such court
and each Party hereby irrevocably waives its right to a jury
trial before such court. Notwithstanding the foregoing,
nothing in this Section 11.7 shall prohibit a Party from
seeking temporary or injunctive relief from a state or federal
43
court in Delaware pending the resolution of a dispute in
accordance with the provisions of this Section 11.7.
Notwithstanding the foregoing, none of the provisions of this
Section 11.7 shall apply if and to the extent that this
Agreement becomes a direct license between [ * CON * ] and
AHPC as provided in Section 2.5 hereof, PROVIDED, HOWEVER,
that [ * CON * ] and AHPC will use good faith efforts to have
any disputes between them resolved by their respective senior
management prior to seeking any remedies that may be available
through the courts.
11.8 PROVISIONS FOR INSOLVENCY.
11.8.1 EFFECT ON LICENSES. All rights and licenses granted
under or pursuant to this Agreement by Apollo to AHPC
are, for all purposes of Section 365(n) of Title 11
of the United States Code ("Title 11"), licenses of
rights to "intellectual property" as defined in Title
11. Apollo agrees that AHPC, as licensee of such
rights under this Agreement shall retain and may
fully exercise all of its rights and elections under
Title 11. Apollo agrees during the Term of this
Agreement to create and maintain current copies or,
if not amenable to copying, detailed descriptions or
other appropriate embodiments, to the extent
feasible, of all such intellectual property. If a
case is commenced by or against Apollo under Title
11, Apollo (in any capacity, including
debtor-in-possession) and its successors and assigns
(including, without limitation, a Title 11 Trustee)
shall,
(i) as AHPC may elect in a written
request, immediately upon such
request:
(A) perform all of the
obligations provided in
this Agreement to be
performed by Apollo
including, where applicable
and without limitation,
providing to AHPC portions
of such intellectual
property (including
embodiments thereof) held
by Apollo and such
successors and assigns or
otherwise available to
them; or
(B) provide to AHPC all such
intellectual property
(including all embodiments
thereof) held by Apollo and
such successors and assigns
or otherwise available to
them; and
(ii) not interfere with the rights of
AHPC under this Agreement, or any
agreement supplemental hereto,
44
to such intellectual property
(including such embodiments),
including any right to obtain such
intellectual property (or such
embodiments) from another entity.
11.8.2 RIGHTS TO INTELLECTUAL PROPERTY. If a Title 11 case
is commenced by or against Apollo, and this Agreement
is rejected as provided in Title 11, and AHPC elects
to retain its rights hereunder as provided in Title
11, then Apollo (in any capacity, including
debtor-in-possession) and its successors and assigns
(including, without limitation, a Title 11 Trustee)
shall provide to AHPC all such intellectual property
(including all embodiments thereof) held by Apollo
and such successors and assigns, or otherwise
available to them, immediately upon AHPC's written
request. Whenever Apollo or any of its successors or
assigns provides to AHPC any of the intellectual
property licensed hereunder (or any embodiment
thereof) pursuant to this Section 14.8, AHPC shall
have the right to perform the obligations of Apollo
hereunder with respect to such intellectual property,
but neither such provision nor such performance by
AHPC shall release Apollo from any such obligation or
liability for failing to perform it.
11.8.3 AHPC'S RIGHTS. All rights, powers and remedies of
AHPC provided herein are in addition to and not in
substitution for any and all other rights, powers and
remedies now or hereafter existing at law or in
equity (including, without limitation, Title 11) in
the event of the commencement of a Title 11 case by
or against Apollo. AHPC, in addition to the rights,
power and remedies expressly provided herein, shall
be entitled to exercise all other such rights and
powers and resort to all other such remedies as may
now or hereafter exist at law or in equity
(including, without limitation, Title 11) in such
event. The Parties agree that they intend the
foregoing AHPC rights to extend to the maximum extent
permitted by law, including, without limitation, for
purposes of Title 11:
(i) the right of access to any
intellectual property (including
all embodiments thereof) of Apollo,
or any Third Party with whom Apollo
contracts to perform an obligation
of Apollo under this Agreement,
and, in the case of the Third
Party, which is necessary for the
development, registration,
manufacture and marketing of
Licensed Compounds and/or Licensed
Products; and
45
(ii) the right to contract directly with
any Third Party described in (i) to
complete the contracted work.
11.9 EXPORT CONTROLS. AHPC hereby agrees that it shall not sell,
transfer, export or re-export any Licensed Product or related
information in any form, or any direct products of such
information, except in compliance with all applicable laws,
including the export laws of the United States Government and
any federal regulations implementing such laws. AHPC shall be
solely responsible for obtaining all licenses, permits or
authorizations required from the United States Government or
the government of any other nation for any such export or
re-export. Apollo agrees to provide AHPC with such assistance
as AHPC may reasonably request in obtaining such license,
permits or authorizations.
11.10 NON-USE OF NAMES. AHPC shall not use Apollo's, [ * CON * ]
name or the names of either of such institution's employees or
any adaptation thereof, in any advertising, promotional or
sales literature without the prior written consent obtained
from Apollo, [ * CON * ], as applicable. Apollo shall not use
AHPC's name, the names of any of AHPC's Affiliates or the
names of any of their respective employees, or any adaptation
thereof, in any advertising, promotional or sales literature
without AHPC's prior written consent. Notwithstanding the
foregoing, to the extent permitted under Section 10.4 hereof,
AHPC and Apollo may each state that the [ * CON * ] and that
this Agreement are in effect.
11.11 ENTIRE AGREEMENT; AMENDMENT. This Agreement and all the
covenants, promises, agreements, warranties, representations,
conditions and understandings contained herein sets forth the
complete, final and exclusive agreement between the Parties
and supersedes and terminates all prior and contemporaneous
agreements and understandings between the Parties, whether
oral or in writing. There are no covenants, promises,
agreements, warranties, representations, conditions or
understandings, either oral or written, between the Parties
other than as are set forth in this Agreement. No subsequent
alteration, amendment, change, waiver or addition to this
Agreement shall be binding upon the Parties unless reduced to
writing and signed by an authorized officer of each Party. No
understanding, agreement, representation or promise, not
explicitly set forth herein, has been relied on by either
Party in deciding to execute this Agreement.
11.12 HEADINGS. The headings and captions used in this Agreement are
solely for the convenience of reference and shall not affect
its interpretation.
46
11.13 COUNTERPARTS. This Agreement may be executed in one or more
counterparts each of which shall be an original and all of
which shall constitute together the same document.
11.14 FURTHER ACTIONS. Each Party agrees to execute, acknowledge and
deliver such further instruments, and to do all other acts, as
may be necessary or appropriate in order to carry out the
purposes and intent of this Agreement including, without
limitation, any filings with any antitrust agency which may be
required.
IN WITNESS WHEREOF, this Agreement has been executed by the duly
authorized representatives of the Parties as of the date set forth below.
AMERICAN HOME PRODUCTS CORPORATION APOLLO BIOPHARMACEUTICS, INC.
-------------------------------------- ----------------------------------
Name: Name:
Title: Title:
47
[CERTAIN MATERIAL (INDICATED BY A [*CON*]) HAS BEEN OMITTED FROM THIS
DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED
MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]
EXHIBIT A
APOLLO PATENT RIGHTS
[ * CON * ]
A-1
EXHIBIT B
DEFINITION OF "ESTROGEN" EXCERPTED FROM U.S PATENT [ * CON * ]
[ * CON * ]
B-1
EXHIBIT C
ADVERSE DRUG EXPERIENCE REPORTING PROCEDURES
[ * CON * ]
C-1