Exhibit 10.1

CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY [* * *],
HAS BEEN EXCLUDED FROM THE EXHIBIT BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II)
WOULD LIKELY CAUSE COMPETITIVE HARM TO VERASTEM, INC. IF PUBLICLY DISCLOSED.

 

LICENSE AGREEMENT FOR CKI27

 

This License Agreement for CKI27 (“Agreement”) is made and entered into as of
January 7th, 2020 (the “Effective Date”) by and between

 

Verastem, Inc., a Delaware corporation with its principal place of business at
117 Kendrick St., Suite 500, Needham, MA 02494, the United States of America
(“VERASTEM”),

 

And

 

CHUGAI PHARMACEUTICAL CO., LTD, a corporation duly established under the laws of
Japan, having its principal place of business at 2-1-1, Nihonbashi-Muromachi,
Chuo-ku, Tokyo 108-8324, Japan (“CHUGAI”).

 

WITNESSETH:

 

WHEREAS, VERASTEM is a pharmaceutical company that possesses expertise in the
research, regulatory, development, manufacturing and commercialization of
pharmaceutical products on a worldwide basis;

 

WHEREAS, CHUGAI is a pharmaceutical company that possesses expertise in the
research, regulatory, development, manufacturing and commercialization of
pharmaceutical products on a worldwide basis; and,

 

WHEREAS, VERASTEM wishes to license from CHUGAI the intellectual property rights
in and to the compound designated by CHUGAI as “CKI27(2)” or “CH5126766
(RO5126766)” so as to develop and commercialize pharmaceutical products
containing such compound, and CHUGAI wishes to license to VERASTEM such
intellectual property rights. 

 

1

 

Exhibit 10.1

NOW, THEREFORE, in consideration of the premises and of the mutual covenants and
agreements hereinafter set forth, VERASTEM and CHUGAI enter into this Agreement
as follows:

 

1.DEFINITIONS AND INTERPRETATION

 

1.1

Definitions

 

Unless the context otherwise requires, the terms in this Agreement, when used
with initial capital letters, shall have the meanings set forth below or at
their first use in this Agreement:

 

“Affiliate” means, with respect to a Party or other entity, any corporation or
other legal entity Controlled by, Controlling, or under common Control with such
Party or entity. For the purpose of this definition, the term “Control” means
owning, directly or indirectly, more than fifty percent (50%) of the issued
voting stock of a corporation or other legal entity, or having otherwise the
power to govern the management.

 

“Applicable Laws” means any and all of the applicable laws, rules and
regulations, including any rules, regulations, guidelines, administrative
guidance, or other requirements of any Governmental Authorities that may be in
effect from time to time in any country or jurisdiction of the Territory.

 

“Business Day” means any day other than Saturdays, Sundays or other days on
which commercial banks located in Boston, the United States of America, or
Tokyo, Japan, are authorized or required by law to remain closed.

 

“Chugai Compound” means (a) the dual Raf/MEK inhibitor referred to by Chugai as
“CKI27(2)” or “CH5126766 (RO5126766),” (b) its acids, bases, salts, metabolites,
esters, isomers, enantiomers, pro-drug forms, hydrates, solvates, polymorphs and
degradants thereof, in each case that has substantially the same pharmacological
effect, in crystal, powder or other form, and (c) any other compounds that are
claimed by [***] as of patent filing date [***].

 

“CMC” means any technology concerning the section of “Chemistry, Manufacturing
and Controls” in the application form to a Government Authority regarding
composition,

2

 

Exhibit 10.1

manufacture and control of a pharmaceutical product, as such term is customarily
used in the pharmaceutical industry.

 

“Commercially Reasonable Efforts” means, with respect to the efforts to be
expended by a Party with respect to any objective hereunder, those reasonable,
diligent, good faith efforts to accomplish such objective as such Party would
normally use to accomplish a similar objective under similar
circumstances.  With respect to VERASTEM’s obligations relating to Development
and Commercialization, “Commercially Reasonable Efforts” means [***].

 

“Confidential Information” shall have the meaning set forth in Article 10.1.

 

“Control” or “Controlled” means, with respect to information or intellectual
property rights, that the Party named as having Control owns such information or
intellectual property rights, or otherwise possesses the ability to grant a
license, sublicense or other rights under or with respect to such information or
intellectual property rights, without violating the terms of any agreement to
which such Party is a party.

 

“Data” means any and all research data, technical data, test and development
data, pre-clinical and clinical data, formulations, processes, manufacturing
information, protocols, regulatory files and the like which are developed by
either Party prior to the Effective Date or during the Term and which relate
directly to the Chugai Compound and/or the Product.

 

“Development and Commercialization” shall have the meaning set forth in Article
3.1.

 

“Disclosing Party” shall have the meaning set forth in Article 10.1.

 

“European Union” or “EU” means (a) all countries or territories that are part of
the European Union; and (b) whether or not it is part of the EU, the United
Kingdom.

 

“EU Opt-Back Right” shall have the meaning set forth in Article 5.1.1.

 

[***].

 

“Field” means all uses, including the diagnosis, prevention and treatment of
diseases and other conditions in all indications.

 

3

 

Exhibit 10.1

“First Commercial Sale” means, with respect to a given Product in the Territory,
the first sale of such Product by VERASTEM or its Affiliates or sublicensees to
a third party (excluding sublicensees) in the Territory after the receipt of
Marketing Authorization for such Product in the Territory. [***]    

 

“Fully-Burdened Manufacturing Cost” means the fully-burdened cost and expense
incurred in the manufacture of a product, determined using VERASTEM’s customary
practices and procedures for its other products, and which includes, without
limitation, the following: [***].

 

“Governmental Authority” means any national (e.g., the FDA), supra-national
(e.g., the EMEA), regional, state or local regulatory agency, department,
bureau, commission, council or other governmental entity in each country of the
world.

 

[***]

 

“Improvements” means data, inventions, discoveries and know-how, whether
patentable or not, and any intellectual property rights thereof, which are
necessary or useful to exploit the Chugai Compound and/or the Product and which
are acquired or developed by the relevant Party or its Affiliates on or after
the Effective Date during the course of its/their activities under this
Agreement or, with respect to CHUGAI, during the course of (a) an On-going
Agreement, the [***] or the MTA Study Agreement, and/or (b) activities under the
license agreement to be entered into between CHUGAI and VERASTEM upon exercise
by CHUGAI of any Opt-Back Right.

 

“IND” means an investigational new drug application as defined in the United
States Federal Food, Drug, and Cosmetic Act and the United States Code of
Federal Regulations, Title 21, Part 312 (“Investigational New Drug
Application”), as amended and applicable regulations promulgated thereunder by
the FDA, or an equivalent application submitted to an equivalent Governmental
Authority in any other country or jurisdiction, the filing of which is necessary
to initiate or conduct clinical testing of a pharmaceutical product in humans in
such country or jurisdiction, including a clinical trial application.

 

“Japan Opt-Back Right” shall have the meaning set forth in Article 5.1.2.

 

[***].

4

 

Exhibit 10.1

 

“Licensed Know-How” means non-public and proprietary data and information that
is necessary or useful to exploit the Chugai Compound and/or the Product, each
existing as of the Effective Date.

 

“Licensed Patents” means any and all Patents that are necessary or useful to
make, have made, develop, sell, offer for sale, have sold, import or export the
Chugai Compound and/or any Product, in each case to the extent Controlled by
CHUGAI as of the Effective Date, including those patents listed in APPENDIX
I(A).  To the extent a Licensed Patent is jointly owned by CHUGAI and VERASTEM,
then the term “Licensed Patent” shall refer to all of CHUGAI’s rights in such
jointly owned Patent.

 

“Marketing Authorization” means, in respect of any country, the marketing
authorization granted by the applicable Governmental Authority, which is
required (in compliance with Applicable Laws) to place any pharmaceutical
product on the market in such country for sale (excluding any pricing or
reimbursement approval).

 

[***].    

 

“MTA Study Agreement” shall have the meaning set forth in Article 2.3.  CHUGAI
shall not amend the MTA Study Agreement without the prior written consent of
VERASTEM, which consent shall not be unreasonably withheld. 

 

“NDA” means a new drug application, as specified in Section 505(b) of the United
States Federal Food, Drug, and Cosmetic Act and in the United States Code of
Federal Regulations, Title 21, Part 314, filed with the FDA or the equivalent
application filed with any other Governmental Authority to obtain a Marketing
Authorization for a Product in a country.

 

“Net Sales” means [***] by VERASTEM, its sublicensees or their respective
Affiliates for the sale of the Product to a non-affiliated third party, less
[***].  For the purpose of clarification, sales between and among any two of
VERASTEM, its sublicensees and their respective Affiliates shall not be subject
to royalty, but in such cases royalties shall accrue and be calculated on any
subsequent sale of the Product to a non-affiliated third party as described
above.

 

5

 

Exhibit 10.1

Notwithstanding the foregoing, in the event a Product is sold in a country as a
“Combination Product,” defined as a product which contains the Chugai Compound
and any therapeutically active pharmaceutical ingredient other than the Chugai
Compound (the “Other Active Ingredient”) in a calendar quarter, Net Sales of
such Combination Product will be calculated as follows:

 

[***].

[***].

[***].

[***].

[***].

 

“Notice” shall have the meaning set forth in Article 15.1.

 

“On-going Agreements” shall have the meaning set forth in Article 2.3.  CHUGAI
shall not amend any On-going Agreement without the prior written consent of
VERASTEM, which consent shall not be unreasonably withheld. 

 

"On-going Agreement 2” shall have the meaning set forth in Appendix II.

 

“On-going Research Data Transfer” shall have the meaning set forth in Article
3.5.

 

“Opt-Back Rights” shall have the meaning set forth in Article 5.1.2.

 

“Party” or “Parties” means either VERASTEM or CHUGAI, as the context requires,
and when used in the plural shall mean VERASTEM and CHUGAI.

 

“Patents” means any and all issued patents and all applications, provisional
applications, substitutions, continuations, continuations-in-part, divisions,
renewals, all letters patent granted thereon, and all reissues, re-examinations
and extensions and supplementary protection certificates and the like thereof,
and all foreign counterparts of any of the foregoing.

 

[***]

 

“Product” means a product which contains the Chugai Compound as the sole active
pharmaceutical ingredient (“API”).

6

 

Exhibit 10.1

 

“Product Trademark(s)” shall have the meaning set forth in Article 8.1.

 

“Receiving Party” shall have the meaning set forth in Article 10.1.

 

“Relevant Data and Information” shall have the meaning set forth in Article 3.3.

 

“Royalty Term” means, with respect to a particular Product in a country in the
Territory, the period of the time beginning upon First Commercial Sale of such
Product in such country and ending upon the later of: (i) the date on which all
Licensed Patents containing a Valid Claim [***] have expired, and (ii) the
twelfth (12th) anniversary of the First Commercial Sale of such Product in such
country.

 

“Territory” means all countries in the world.

 

“Technical Transfer” shall have the meaning set forth in Article 3.4.

 

“Trademarks” means collectively, all registered and unregistered marks, trade
names, trade dress rights, logos, taglines, slogans, and other indicia of
origin, together with the goodwill associated with any of the foregoing, and all
applications, registrations, extensions and renewals thereof, selected for use
on a product.

 

“Valid Claim” means [***]

 

“Verastem Compound” means the FAK inhibitor, defactinib (code name: VA-6063).

 

[***]

 

[***]

 

[***] 

 

1.2Interpretation

For purposes of this Agreement, (i) words in the singular shall be held to
include the plural and vice versa as the context requires, (ii) the words
“including” and “include” shall mean “including, without limitation”, unless
otherwise specified; (iii) the terms “hereof”,

7

 

Exhibit 10.1

“herein”, “herewith”, and “hereunder”, and words of similar import shall, unless
otherwise stated, be construed to refer to this Agreement as a whole and not to
any particular provision of this Agreement; and (iv) all references to Articles,
Sections, Appendices, Schedules and subdivisions thereof shall, unless otherwise
specified, are intended to refer to Articles of, Schedules of, Appendices and
Schedules to this Agreement and subdivisions thereof, respectively.

 

1.3Headings

The headings in this Agreement are for convenience of reference only and shall
not limit or otherwise affect the interpretation of any of the terms or
provisions of this Agreement.

 

2. GRANT OF LICENSE AND IMPROVEMENTS

 

2.1License Grant. 

2.1.1Rights Granted

Subject to the terms and conditions herein contained, CHUGAI hereby grants
VERASTEM an exclusive (including with regard to CHUGAI and its Affiliates)
license, with the right to grant sublicenses as provided in Article 2.2, under
the Licensed Patents and Licensed Know-How, to develop, have developed,
register, have registered, make, have made, manufacture, have manufactured, use,
have used, distribute, have distributed, market and have marketed (including the
right to detail and promote), offer to sell, have offered to sell, sell, have
sold, import and have imported the Chugai Compound and/or the Product in the
Field in the Territory.

 

2.1.2Relationship with On-going Agreements

With respect to [***] as Licensed Patents, which were acquired or developed
during the course of an On-going Agreement, the license granted from CHUGAI to
VERASTEM hereunder is subject to the rights and obligations under the applicable
On-going Agreement.

 

2.2The Right to Sublicense

The license granted under Article 2.1 to VERASTEM shall include the right to
grant sublicenses under the Licensed Patents and Licensed Know-How and shall
also include the right to grant to a sublicensee the right to grant further
sublicenses.

If VERASTEM or any of its Affiliates enters into a sublicense agreement or any
agreement with a third party service provider or manufacturer, VERASTEM shall
ensure that the applicable terms and conditions of this Agreement shall apply to
the applicable

8

 

Exhibit 10.1

sublicensee, service provider or manufacturer to the same extent as they apply
to VERASTEM with respect to, and to the extent of the Licensed Patents and
Licensed Know-How. VERASTEM shall assume full responsibility for the performance
of all its obligations under this Agreement.

 

2.3Exclusivity as to CHUGAI

Except for (i) the Technical Transfer, (ii) the development or commercialization
activities for the Product conducted by CHUGAI pursuant to this Agreement, (iii)
[***] (iv) CHUGAI’s support of the non-clinical research activities for the
Chugai Compound or the Product conducted by [***] pursuant to that certain
Material Transfer Agreement, entered into between [***] and CHUGAI, dated as of
[***] (the “MTA Study Agreement”), (v) CHUGAI’s support of the clinical trial
for the Chugai Compound or the Product pursuant to that certain [***] with
CHUGAI entered into between [***], and CHUGAI, [***] (the “[***]”), or (vi) any
activities conducted by CHUGAI pursuant to the license agreement to be entered
into between CHUGAI and VERASTEM upon exercise by CHUGAI of any Opt-Back Right,
CHUGAI shall not conduct any activities for the Chugai Compound or the Product
in the Territory without prior approval of VERASTEM.

Notwithstanding anything to the contrary herein, CHUGAI may continue to support
the investigator initiated studies for which CHUGAI is providing support as of
the Effective Date pursuant to the agreements listed in Appendix II (the
“On-going Agreements”),   the [***] and the MTA Study Agreement. CHUGAI may
provide any financial, technical or other support and the Product or Chugai
Compound to such investigator initiated studies as required pursuant to the
terms and conditions of the On-going Agreements or [***].

 

2.4Improvements

2.4.1VERASTEM Improvements

Any and all Improvements solely acquired or developed by VERASTEM, and/or by any
third parties on behalf of VERASTEM, shall be solely owned by VERASTEM
(hereinafter “VERASTEM Improvements”). VERASTEM’s rights thereto and interests
therein shall become subject to CHUGAI’s Opt-Back Rights under Article 5.

 

2.4.2CHUGAI Improvements

(a)Any and all Improvements solely acquired or developed by CHUGAI, and/or by
any third parties on behalf of CHUGAI, or otherwise Controlled by CHUGAI,
including through the terms of any On-going Agreement, the [***] and the MTA
Study Agreement, shall be solely owned or Controlled by CHUGAI (hereinafter
“CHUGAI Improvements”). Subject to the

9

 

Exhibit 10.1

terms and conditions herein contained, CHUGAI hereby grants to VERASTEM (i) with
respect to CHUGAI Improvements arising from the Ongoing Agreements, an exclusive
(including with regard to CHUGAI and its respective Affiliates) license, with
the right to grant sublicense as provided in Article 2.2, to use such CHUGAI
Improvements to develop, have developed, register, have registered, make, have
made, manufacture, have manufactured, use, have used, distribute, have
distributed, market and have marketed (including the right to detail and
promote), offer to sell, have offered to sell, sell, have sold, import and have
imported the Chugai Compound and/or the Product in the Field in the Territory
and (ii) with respect to CHUGAI Improvements arising from the [***]or Patents
covering CHUGAI Improvements arising from the MTA Study Agreement, a
non-exclusive, fully-paid up and royalty-free license, with the right to grant
sublicense as provided in Article 2.2, to use such CHUGAI Improvements to
develop, have developed, register, have registered, make, have made,
manufacture, have manufactured, use, have used, distribute, have distributed,
market and have marketed (including the right to detail and promote), offer to
sell, have offered to sell, sell, have sold, import and have imported the Chugai
Compound and/or the Product in the Field in the Territory.  The foregoing
licenses are subject to the rights and obligations under the Ongoing Agreements,
the [***] and the MTA Study Agreement, respectively and CHUGAI grants such
licenses only to the extent CHUGAI is granted or entitled under the applicable
On-going Agreement, [***] or MTA Study Agreement. 

 

(b)If CHUGAI [***], then the Study IPR (as defined in On-going Agreement 2),
 for use with the Chugai Compound or the Product, shall be included as a CHUGAI
Improvement.

 

(c)If any CHUGAI Improvements arising out of an On-going Agreement are covered
by a Patent, then such Patents shall be considered Licensed Patents
hereunder.  If any CHUGAI Improvements arising out of the [***] and the MTA
Study Agreement are covered by a Patent, then such Patents shall not be
considered Licensed Patents hereunder.

 

(d)  CHUGAI hereby agrees that with respect to CHUGAI Improvements arising from
the [***] or MTA Study Agreement, it may not grant to any third party any
license to use such CHUGAI Improvements to develop, have developed, register,
have registered, make, have made, manufacture, have manufactured, use, have
used, distribute, have distributed, market and have marketed (including the
right to detail and promote), offer to sell, have offered to sell, sell, have
sold, import and have imported the Chugai Compound and/or the Product in the
Field in the Territory.

 

10

 

Exhibit 10.1

2.4.3Joint Improvements

Any and all Improvements acquired or developed jointly by VERASTEM and CHUGAI
shall be jointly owned by the Parties (hereinafter “Joint Improvements”).
Subject to the terms and conditions herein contained, CHUGAI hereby grants to
VERASTEM an exclusive (including with regard to CHUGAI and its respective
Affiliates) right, with the right to grant sublicense as provided in Article
2.2, under CHUGAI’s rights in Joint Improvements to develop, have developed,
register, have registered, make, have made, manufacture, have manufactured, use,
have used, distribute, have distributed, market and have marketed (including the
right to detail and promote), offer to sell, have offered to sell, sell, have
sold, import and have imported the Chugai Compound and/or the Product in the
Field in the Territory.  VERASTEM’s rights in Joint Improvements shall become
subject to CHUGAI’s Opt-Back Rights under Article 5.

 

3.DEVELOPMENT, COMMERCIALIZATION AND REGULATORY ACTIVITIES

3.1Responsibility of VERASTEM

VERASTEM shall have the sole responsibility for, as well as full freedom to
decide and implement, at its sole expense, all development and commercialization
activities for the Product in the Field in the Territory, including, but not
limited to, regulatory filings and communications with Governmental Authorities
for Marketing Authorizations, manufacturing of the Chugai Compound and/or the
Product, marketing, promotion, decisions on package design and Trademark used
for the Product sold in the Field in the Territory and decision on timing and
strategy of launch of the Product in the Field in the Territory (collectively
“Development and Commercialization”).

Any and all regulatory filings relating to the Development and
Commercialization, including, but not limited to, a filing for IND and NDA,
shall be made under the name of VERASTEM or its designee/assignee.

For regulatory or pharmacovigilance purposes, VERASTEM, or its designee and/or
assignee, shall be the sponsor of any clinical development of the Product in the
Field in the Territory.

 

3.2Commercially Reasonable Efforts

VERASTEM shall use Commercially Reasonable Efforts in the Territory to develop
or have developed and obtain or have obtained Marketing Authorizations and any
other approvals of Governmental Authorities necessary or advisable to sell the
Product and thereafter to market and sell the Product.

 

11

 

Exhibit 10.1

3.3Provision of Relevant Data and Information

Promptly after the Effective Date, CHUGAI shall disclose or provide to VERASTEM
all existing Data and technology and regulatory filings/approvals in its
possession for the Chugai Compound or Product in the Field in the Territory
(“Relevant Data and Information”).  This includes, without limitation, providing
VERASTEM with full access (and not just view access) to all of the information
CHUGAI has placed in the virtual data room prior to the Effective Date. The
Relevant Data and Information so disclosed or provided to VERASTEM shall remain
in the sole ownership of CHUGAI at all times and VERASTEM shall have an
exclusive (including with regard to CHUGAI and its respective Affiliates)
license, with the right to grant sublicenses as provided in Article 2.2, to use
and exploit such Relevant Data and Information for the development and
commercialization of the Chugai Compound or the Product in the Field in the
Territory under this Agreement; provided that CHUGAI may use and exploit such
Relevant Data and Information for any activities permitted to CHUGAI under
Article 2.3. The consideration set out in Article 6 below shall be deemed to
include any fee, compensation and/or royalties whatsoever for the exclusive
license of the Relevant Data and Information.

 

3.4Technical Transfer

Upon VERASTEM’s request, CHUGAI shall conduct activities to transfer to VERASTEM
technical information and know-how relating to the production or manufacture of
the Chugai Compound and/or Product, including any Relevant Data and Information
and Licensed Know-How, for the purpose of enabling VERASTEM to conduct
activities relating to CMC and resulting production or manufacture of the
Product (such activities of CHUGAI, “Technical Transfer”). For the avoidance of
doubt, the Technical Transfer shall not require CHUGAI to conduct new CMC
experimental research not currently ongoing or otherwise completed as of the
Effective Date.　

All materials and information provided by CHUGAI to VERASTEM in connection with
the Technical Transfer shall be provided on an “AS IS” basis, provided that
CHUGAI shall provide all such materials and information in the English language.

The detailed activities, the process of, and the required time period for the
Technical Transfer shall be described in APPENDIX III.  For the sake of clarity,
the required time periods for the Technical Transfer described in Appendix III
shall begin upon VERASTEM’s request to begin the Technical Transfer activities. 
Additionally, CHUGAI shall reasonably cooperate with VERASTEM by providing, upon
VERASTEM’s request,  (i) any additional data and information relating to the
production or manufacture of the Chugai Compound and/or Product and Controlled
by CHUGAI that has not been provided under the initial Technical

12

 

Exhibit 10.1

Transfer and (ii) reasonable assistance in responding to queries from Government
Authorities in the Territory relating to the Chugai Compound and/or the Product
to the extent that CHUGAI can assist without performing any work to produce new
data or information.

 

3.5Ongoing Research Data Transfer

3.5.1CHUGAI shall conduct activities to transfer to VERASTEM the data of the
on-going research relating to the Chugai Compound or the Product conducted in
accordance with (a) the On-going Agreements, except for the On-going Agreement 2
(as defined in Appendix II), and (b) the [***], subject to the rights and
obligations under the applicable On-going Agreement or the [***] (such
activities of CHUGAI, the “On-going Research Data Transfer”). All materials and
information provided by CHUGAI to VERASTEM in connection with the On-going
Research Data Transfer shall be provided on an “AS IS” basis, provided that
CHUGAI shall provide all such materials and information in the English language.
   

3.5.2CHUGAI shall not provide the data of the on-going research relating to the
Chugai Compound or the Product conducted in accordance with the On-going
Agreements and the [***] to any third party without the prior written consent of
VERASTEM, which consent shall not be unreasonably withheld.

 

3.6Manufacturing and Supply

3.6.1Subject to CHUGAI’s performance of its obligations under Articles 3.3  and
3.4,  as between the Parties, VERASTEM shall have the sole responsibility, at
its sole expense, for CMC development and supply of the Chugai Compound and
Product, including clinical and commercial supply (subject to the provisions
detailed in Appendix IV if CHUGAI exercises its Opt-Back Right). 

 

3.6.2Notwithstanding Article 3.6.1, CHUGAI, directly or through its designee,
shall supply VERASTEM with, and VERASTEM shall make a one-time purchase from
CHUGAI of, the materials listed on Appendix VI (“Inventory”) within the
timelines set forth on Appendix VI.  CHUGAI shall deliver the Inventory to
VERASTEM at EXW CHUGAI’s facilities in Japan (INCOTERMS 2010).  VERASTEM shall
pay to CHUGAI [***] for the Inventory within [***]days after CHUGAI delivers the
Inventory to VERASTEM.

 

3.6.3As described in Appendix VI, as of the Effective Date, CHUGAI has in its
possession [***]  For the period of time between the Effective Date and [***]
CHUGAI hereby grants to VERASTEM an option to purchase [***] for a price to be
negotiated in good faith by the parties if and when VERASTEM exercises this
option.  During the [***], CHUGAI shall maintain

13

 

Exhibit 10.1

and/or effectively preserve, and shall not dispose of, [***].

   

3.7Development Reports

No less frequently than [***], VERASTEM shall provide CHUGAI with written
reports summarizing its, its Affiliates’, and its sublicensees’ development of
Product, including a summary of the data, timelines and results of such
development, and an overview of future development activities reasonably
contemplated by VERASTEM, which reports shall be provided in English. Such
reports shall be the Confidential Information of VERASTEM pursuant to Article
10. VERASTEM shall respond to CHUGAI’s reasonable requests for additional
information regarding significant development activities, as CHUGAI may request
from time to time.

 

3.8Sales Forecast

During the Royalty Term for any particular Product and for planning purposes
only, VERASTEM shall provide to CHUGAI the following information by no later
than [***] of each [***]:  a non-binding sales forecast of such Product covering
[***] and the following [***], which forecast shall be on a [***] basis for
[***] and on an [***] basis for [***].

 

4. Joint Committee

4.1Establishment of the Joint Committee 

Within a reasonable period of time after the Effective Date, the Parties shall
establish a Joint Committee (“JC”) of four (4) committee members, consisting of
two (2) representatives designated by each Party.

 

4.2Duration, Scope of Authority and Responsibilities of the Joint Committee 

The JC shall continue in existence until the earlier of (a) First Commercial
Sale or (b) the Parties mutually agree in writing to disband. The JC shall (i)
review and comment on the development plan, provided that in the event of any
disagreement between the Parties, VERASTEM shall have the final decision-making
authority, (ii) address and coordinate resolution of issues that may arise
relating to the Technical Transfer, and (iii) address other issues and matters
as the Parties may agree from time to time.

 

4.3Meetings of the Joint Committee 

The JC shall be organized [***] as agreed by the Parties and at such other times
as deemed appropriate by the JC.    A quorum of the JC shall exist whenever
there is present at a meeting at least one representative appointed by each
Party. The meetings of the JC shall

14

 

Exhibit 10.1

take place alternately in Needham, Massachusetts, Tokyo, Japan, or any other
places, or the JC may be organized by means of telephone or video conferencing,
as are mutually agreed.  For the avoidance of doubt, the meetings of the JC
shall be conducted in English, and any materials provided to the JC in
connection with such discussions shall be provided in English.

 

5.Opt-Back Right [***]

5.1　Opt-Back Rights

5.1.1Subject to the terms and conditions of this Agreement, CHUGAI shall have an
opt-back right to develop and commercialize the Chugai Compound and/or Product
in the Field in the European Union (the “EU Opt-Back Right”) at any time from
the Effective Date through the date VERASTEM submits an NDA to the FDA in the
United States for the Product (the “EU Opt-Back Trigger Date”).

5.1.2Subject to the terms and conditions of this Agreement, CHUGAI shall have an
opt-back right to develop and commercialize the Chugai Compound and/or Product
in the Field in Japan and Taiwan (the “Japan Opt-Back Right” and together with
the EU Opt-Back Right, the “Opt-Back Rights”) at any time from the Effective
Date through the date VERASTEM receives Marketing Authorization from the FDA in
the United States for the Product (the “Japan Opt-Back Trigger Date”).

5.1.3No later than [***] days after the EU Opt-Back Trigger Date, CHUGAI may, by
written notice to VERASTEM, in its sole discretion, elect to exercise the EU
Opt-Back Right.  If CHUGAI exercises the EU Opt-Back Right, the parties shall
have [***] days to negotiate in good faith and enter into a written agreement
outlining the terms and conditions that govern the EU Opt-Back Right, which
agreement shall include all of the terms identified in Appendix IV.

5.1.4No later than [***] days after the Japan Opt-Back Trigger Date, CHUGAI may,
by written notice to VERASTEM, in its sole discretion, elect to exercise the
Japan Opt-Back Right.  If CHUGAI exercises the Japan Opt-Back Right, the parties
shall have [***] days to negotiate in good faith and enter into a written
agreement outlining the terms and conditions that govern the Japan Opt-Back
Right, which agreement shall include all of the terms identified in Appendix IV.

5.1.5For the avoidance of doubt, the EU Opt-Back Right and the Japan Opt-Back
Right may be exercised independently by CHUGAI.

5.1.6To enable CHUGAI to make a determination regarding its Opt-Back Rights,
upon CHUGAI’s request, VERASTEM shall provide CHUGAI with all information and
data related to the Chugai Compound and/or Product that are Controlled by
VERASTEM, including data (including raw data) and results generated under any
pivotal study of Product and data and

15

 

Exhibit 10.1

results related to the concomitant drug used in combination with the Product in
such pivotal study.

 

5.2 [***]

 

6. CONSIDERATION

6.1Consideration.  

As consideration for the exclusive license to the Licensed Patents and Licensed
Know-How set forth in Article 2.1, VERASTEM shall pay to CHUGAI the amounts set
forth in this Article 6.

 

6.2Up-front Fee 

VERASTEM shall pay a one-time, non-refundable and non-creditable up-front fee of
Three Million (3,000,000) USD (the “Up-front Fee”). Upon execution of this
Agreement, CHUGAI shall provide an original invoice for the Up-front Fee to
VERASTEM, and VERASTEM shall pay the Up-front Fee within forty-five (45) days
from the Effective Date.

 

6.3Royalty Payment

6.3.1Royalties

VERASTEM shall, on a Product-by-Product basis during the applicable Royalty
Term, pay to CHUGAI royalties of [***] of Net Sales of each Product sold in the
Territory; provided, however, that (a) if there are no Valid Claims in a country
of sale in the Territory or (b) a pharmaceutical product containing the same
active pharmaceutical ingredient as the Product (i.e., a generic product) is
being sold by a third party in a country of sale in the Territory, said royalty
for such country shall be thereafter reduced to [***] of Net Sales of the
relevant Product sold in such country.

 

6.3.2Cumulative Royalties. 

The obligation to pay royalties under this Agreement shall be imposed only once
with respect to a single unit of a Product regardless of how many Valid Claims
included within the Licensed Patents would, but for this Agreement, be infringed
by the manufacture or commercialization of such Product.

 

6.3.3Third Party Payments.  If VERASTEM is required to make payments to any
third party in consideration for a license under, assignment of, or obligation
not to assert a Patent Controlled by such third party that, in the reasonable
opinion of VERASTEM’s patent counsel,

16

 

Exhibit 10.1

is necessary to make, have made, use, develop, sell, offer for sale or import
the Chugai Compound or Product without infringing the Patent of such third party
(such payments, “Third Party Payments”), VERASTEM may credit against any royalty
payments due to CHUGAI under Article 6.3.1 up to [***] of such Third Party
Payments; provided that, in no event will royalties payable to CHUGAI be reduced
by more than [***] as a result of such credit.  VERASTEM agrees to first consult
with CHUGAI prior to obtaining a license under, assignment of, or obligation not
to assert such a third party Patent.

 

6.3.4Payment of Royalties

Royalties shall be paid by VERASTEM to CHUGAI [***], within [***] days after the
receipt of an invoice issued by CHUGAI with regards to [***], which shall be
issued within [***] days after its receipt of an actual sales report from
VERASTEM in accordance with Article 6.3.5.

 

6.3.5Sales Report & Currency Conversion

Within [***] days after the end of each [***], commencing with the [***] during
which the First Commercial Sale of the first Product is made anywhere in the
Territory, VERASTEM shall send to CHUGAI a [***] sales report which shall
include the royalty amount, the Net Sales amount and the quantity and unit price
of the Product sold in the just ended [***] in each country in the Territory.

Royalties shall be first calculated in the currency of sale and, if Net Sales
are not first made in USD, they shall be converted into USD, by applying the
cross interbank exchange rate between the two currencies as published on [***]
for which the sales are made for the purpose of determining the amount of
royalties.

 

6.4Payment Account

Payments shall be made to the bank account indicated by CHUGAI. The Up-front Fee
and all royalties shall be paid in USD. All costs associated with payments to
CHUGAI, including the costs of wire transfers, shall be deducted from the
payments to CHUGAI.

 

6.5Late Payments 

VERASTEM shall pay CHUGAI interest on any payment under this Agreement that is
not paid on or before the due date at the rate of [***] calculated from the due
date to the date paid in full.

 

6.6Withholding Tax

17

 

Exhibit 10.1

If provision is made in law or regulation of any country for withholding taxes
with respect to any amounts payable under this Agreement to CHUGAI, then
VERASTEM shall promptly pay such withholding taxes on behalf of CHUGAI to the
proper Governmental Authority, and shall promptly furnish CHUGAI with evidence
of payment. VERASTEM shall be entitled to deduct any such withholding taxes from
such payments due to CHUGAI or be promptly reimbursed by CHUGAI if such payments
due to CHUGAI have been made without such deduction. Each Party agrees to assist
the other Party in claiming exemption from such deductions or withholdings under
double taxation or similar agreement or treaty from time to time in force and in
minimizing the amount required to be so withheld or deducted.

 

6.7Audit

VERASTEM shall maintain, and shall cause its Affiliates and sublicensees to
maintain, full, complete and accurate books and records containing all
particulars that may be necessary for the purpose of calculating all royalties
due under this Agreement. Such books and records shall be kept at their
principal place of business.

VERASTEM and its Affiliates shall permit CHUGAI, by independent qualified public
accountants selected by CHUGAI and reasonably acceptable to VERASTEM, to examine
VERASTEM’s books and records at any reasonable time during business hours, but
not later than [***] following the rendering of any corresponding reports,
accountings and payments pursuant to this Agreement. The foregoing right of
examination may be exercised [***]. Such accountants may be required by VERASTEM
and its Affiliates to enter into reasonably acceptable confidentiality
agreements, and in no event shall such accountants disclose to CHUGAI any
information other than such as relates to the accuracy of reports and payments
made or due hereunder. The opinion of said independent accountants regarding
such reports, accountings and payments shall be binding on the Parties.

VERASTEM shall request its sublicensees to allow VERASTEM to examine their books
and records under similar conditions as in this Agreement and shall make the
results of such audits available to CHUGAI to the extent reasonably necessary to
allow CHUGAI to confirm the accuracy of VERASTEM’s payments to CHUGAI.

CHUGAI shall bear the cost of any such examination; provided that if the audit
shows an underpayment of royalties due to CHUGAI of more than [***] of the
amount due for the applicable accounting period, then [***].  

VERASTEM or CHUGAI, as the case may be, shall promptly pay to the other Party
the amount of the underpayment or overpayment revealed by an audit.

 

7PATENTS　 

18

 

Exhibit 10.1

7.1PATENT PROSECUTION

7.1.1Prosecution and Maintenance of Licensed Patents and Patents Covering CHUGAI
Improvements

CHUGAI shall control [***] the filing, prosecution and maintenance of the
Licensed Patents and Patents covering CHUGAI Improvements in the Territory,
including, but not limited to, filing applications for, and obtaining, patent
term extensions, supplemental protection certificates and the like in each
country where it is appropriate to do so in CHUGAI’s reasonable judgment. If
VERASTEM and/or CHUGAI wish to apply for extension of the term of any Licensed
Patents and Patents covering CHUGAI Improvements available under any Applicable
Law of any country in the Territory, the Parties shall cooperate in such
application (e.g., by providing the other Party with all information and
documents in each Party’s possession which may be necessary or desirable for
such application).

 

7.1.2Prosecution and Maintenance of Patents Covering VERASTEM Improvements

VERASTEM shall control [***] the filing, prosecution and maintenance of any
Patents covering VERASTEM Improvements in the Territory, including, but not
limited to, filing applications for, and obtaining, patent term extensions,
supplemental protection certificates and the like in each country where it is
appropriate to do so in VERASTEM’s reasonable judgment. If VERASTEM and/or
CHUGAI wish to apply for extension of the term of any Patents covering VERASTEM
Improvements available under any Applicable Law of any country in the Territory,
the Parties shall cooperate in such application (e.g., by providing the other
Party with all information and documents in each Party’s possession which may be
necessary or desirable for such application).

 

7.1.3Prosecution and Maintenance of Patents Covering Joint Improvements

With respect to any Patents covering Joint Improvements, the Party from whom the
majority of the data underlying such patent application arises (hereinafter the
“Controlling Party”) shall control [***] the filing, prosecution and maintenance
of any Patents covering Joint Improvements in the Territory, including, but not
limited to, filing applications for, and obtaining, patent term extensions,
supplemental protection certificates and the like in each country where it is
appropriate to do so in the Controlling Party’s reasonable judgment; provided,
however, the Controlling Party shall make any material decision (e.g., decision
resulting in a limitation of the scope of the claims, abandonment of one or more
such patent or patent application in any country in the Territory, and the like)
to be made in connection with the filing, prosecution and maintenance of such
patent or patent application after consultation with the other Party. If
VERASTEM and/or CHUGAI wish to apply for extension

19

 

Exhibit 10.1

of the term of any Patents covering Joint Improvements available under any
Applicable Law of any country in the Territory, the Parties shall cooperate in
such application (e.g. by providing the other Party with all information and
documents in each Party’s possession which may be necessary or desirable for
such application).

 

7.2PATENT INFRINGEMENT

7.2.1Notice of Patent Infringement

Each Party shall promptly notify the other Party in writing if it reasonably
believes that any Licensed Patent or any Patent covering an Improvement is
being, or has been, infringed or misappropriated by a third party in any
country.

 

7.2.2Prosecution of Patent Infringement

If such infringement or misappropriation relates to the Product, VERASTEM shall
have the first right, but not the obligation, to initiate or pursue legal action
in the Territory. In the case VERASTEM engages in such action, VERASTEM [***]
with respect to any such action and may first retain all related recoveries,
subject to the below. VERASTEM shall notify CHUGAI of such action and keep
CHUGAI informed with respect to the disposition of any action taken in
connection therewith and shall reasonably consider CHUGAI’s comments on any such
action. Any damages or monetary recovery from such action, including any
settlement, shall be allocated first to the reimbursement of any costs and
expenses incurred by VERASTEM.  Any remaining recoveries shall be retained by
VERASTEM, and shall be [***]. In the event VERASTEM does not bring action in the
Territory within [***] days after notification above, then CHUGAI shall have the
right to initiate an action against any third party engaged in such infringement
or misappropriation in the Territory. In such case, CHUGAI [***] with respect to
any such prosecution and shall retain all related recoveries. Each Party shall
provide the other Party with reasonable cooperation and assistance.

 

8TRADEMARKS

8.1VERASTEM shall identify and select one or more Trademarks to be used for the
Products in the Territory. In this Agreement, the Trademark(s) that VERASTEM has
decided to associate to the relevant Product shall be referred to as “Product
Trademarks”. VERASTEM shall own all of the Product Trademarks, and shall be, at
its cost, responsible for procurement, registration, maintenance and enforcement
of any of the Product Trademarks.

 

8.2Infringement

20

 

Exhibit 10.1

VERASTEM shall have the sole right, but not the obligation, to initiate
proceedings against, or defend claims made by, any person in connection with any
of the Product Trademarks. The commencement, strategies, termination, settlement
or defense of any action relating to the validity of the Product Trademarks
shall be decided by VERASTEM. Any such proceedings shall be at the expense of
VERASTEM. Any damages or costs recovered by VERASTEM as a result of any such
proceedings or claims shall be at the sole benefit and account of VERASTEM.

 

9TERM AND TERMINATION

9.1Term

This Agreement shall enter in force as of the Effective Date and remain in
effect on a Product-by-Product and country-by-country basis in the Territory
until expiry of the Royalty Term in such country, unless earlier terminated in
accordance with this Article 9 or as otherwise agreed in writing by the Parties.

 

9.2Consequences of the Expiration of the Royalty Term

Upon expiration of the Royalty Term in each country, VERASTEM shall have a
perpetual, non-exclusive, fully paid-up, royalty-free license under the Licensed
Patents and Licensed Know-How to develop, have developed, use, have used sell,
have sold, offer for sale, have offered for sale, import and have imported such
Product in the Field in such country.

 

9.3Early Termination

9.3.1Termination by CHUGAI for Challenge against Licensed Patents

[***] CHUGAI may terminate this Agreement in its entirety at any time upon
written notice to VERASTEM, if VERASTEM, its Affiliates or any sublicensee,
individually or in association with a third party, commences a legal action
challenging the validity of any of the Licensed Patents (including the Patents
covering a Chugai Improvement, if any).  [***]  

 

9.3.2Termination by VERASTEM

VERASTEM shall have the right to terminate this Agreement in its entirety at any
time and for any reason and with no further payments to CHUGAI (aside from any
payment obligations which have accrued by the termination date), by giving
CHUGAI one hundred eighty (180) days prior written notice.

 

9.3.3Termination by Either Party

9.3.3.1For Material Breach

21

 

Exhibit 10.1

Upon a material breach of this Agreement by the other Party, the non-breaching
Party may, at its option, terminate this Agreement in its entirety by giving
written notice to the breaching Party if such breach remains substantially
uncorrected for a period of one hundred and twenty (120) days after such breach
is brought to the breaching Party’s attention in reasonable detail in writing.

 

9.3.3.2For Bankruptcy

[***], either Party may terminate this Agreement in its entirety at any time
upon notice to the other Party if the other Party:

(a)files an application for declaration of bankruptcy, commencement of
procedures for bankruptcy, civil rehabilitation, corporate reorganization or
corporate arrangement, or similar application or filing or resolves its
dissolution (other than as due to merger) at its board of directors meeting or
any counterpart under Applicable Law; or

(b)is subject to a declaration of bankruptcy, a decision for the commencement of
bankruptcy, civil rehabilitation or corporate reorganization or an order for the
commencement of corporate arrangement or special liquidation or any counterpart
under Applicable Law, provided that any involuntary petition against the other
Party has not been stayed or dismissed within [***] days of its filing.

 

9.4Consequences of Early Termination

9.4.1Cessation of Activities Upon Any Early Termination

In the event this Agreement is terminated early for any reason in its entirety,

(i) all of VERASTEM’s rights to the Licensed Patents, Licensed Know-How, and
CHUGAI Improvements shall cease in the Territory, and

(ii) VERASTEM shall cease all the activities licensed under this Agreement in
the Territory.

 

9.4.2Early Termination by CHUGAI or by VERASTEM for Convenience

In the event this Agreement is terminated in its entirety (a) by CHUGAI pursuant
to Article 9.3.1 (Termination by CHUGAI for Challenge against Licensed Patents),
Article 9.3.3.1 (For Material Breach) or 9.3.3.2 (For Bankruptcy) or (b) by
VERASTEM pursuant to Article 9.3.2 (Termination by VERASTEM), in addition to
9.4.1 above, VERASTEM shall,

(i) [***], transfer to CHUGAI all data and know-how necessary or useful to
exploit the Chugai Compound or the Product, including without limitation, data
obtained through clinical trials and information contained in regulatory
submissions;

(ii) grant CHUGAI a perpetual, royalty-free license, with the right to
sublicense, to use

22

 

Exhibit 10.1

or practice the VERASTEM Improvements in the Field in the Territory;

(iii) [***], transfer and assign to CHUGAI any Product Trademarks in the
Territory;

(iv) [***], assign to CHUGAI or a third party designated by CHUGAI all INDs,
NDAs, and Marketing Authorizations for the Product in the Territory;

(v) in response to a request from CHUGAI [***], transfer to CHUGAI or a third
party designated by CHUGAI all inventory of Chugai Compound and/or the Product
(including all final product, bulk drug substance, intermediates,
works-in-process, formulation materials, reference standards, drug product
clinical reserve samples, packaged retention samples, and the like) then in
possession or control of VERASTEM or its Affiliates; and

(vi) in response to a request from CHUGAI, transfer to a third party designated
by CHUGAI written materials, technical information and know-how relating to the
production or manufacture of the Chugai Compound and/or the Product for the
purpose of enabling such third party to produce or manufacture the Chugai
Compound and/or the Product for Development and Commercialization by CHUGAI,
within a reasonable period [***]. 

 

9.4.3Early Termination for CHUGAI’s Material Breach or Bankruptcy

In the event this Agreement is terminated in its entirety by VERASTEM pursuant
to Article 9.3.3.1 (For Material Breach), in addition to 9.4.1 above, VERASTEM
shall,

(i) grant CHUGAI a perpetual license, with the right to sublicense, all data and
know-how necessary or useful to exploit the Chugai Compound or the Product,
including without limitation, data obtained through clinical trials and
information contained in regulatory submissions;

(ii) grant CHUGAI a license, with the right to sublicense, to use or practice
the VERASTEM Improvements in the Field in the Territory;

(iii) grant CHUGAI a perpetual license, with the right to sublicense, any
Product Trademarks in the Territory;

(iv) [***], assign to CHUGAI or a third party designated by CHUGAI all INDs,
NDAs, and Marketing Authorizations for the Product in the Territory;

(v) at VERASTEM’s option, [***] transfer to CHUGAI or a third party designated
by CHUGAI all inventory of Chugai Compound and/or the Product (including all
final product, bulk drug substance, intermediates, works-in-process, formulation
materials, reference standards, drug product clinical reserve samples, packaged
retention samples, and the like) then in possession or control of VERASTEM or
its Affiliates; and

(vi) in response to a request from CHUGAI, transfer to a third party designated
by CHUGAI written materials, technical information and know-how relating to the
production or manufacture of the Chugai Compound and/or the Product for the
purpose of enabling such

23

 

Exhibit 10.1

third party to produce or manufacture the Chugai Compound and/or the Product for
Development and Commercialization by CHUGAI, within a reasonable period [***]. 

The consideration of the licenses under (i) to (iii) above in this Article 9.4.3
shall be reasonable and separately discussed and agreed between the Parties.

 

9.5Survival

The foregoing notwithstanding, any provisions which by their specific language
or context are intended to or can be fairly read to survive termination of this
Agreement, shall survive any termination of this Agreement for any reason or the
expiration of the term set forth in Article 9.1.

Without prejudice to the generality of the foregoing, the Parties acknowledge
that Articles 6.7 (Audit), 9.4 (Consequences of Early Termination), 10
(Confidentiality), 13 (Indemnification), 14 (Limitation of Liability), 16
(Governing Law and Dispute Resolution) and 17 (Miscellaneous) shall survive the
termination of this Agreement and the expiration of the term set forth in
Article 9.1.

 

10CONFIDENTIALITY

10.1In this Agreement, “Confidential Information” means, subject to Article
10.2, (a) any data, know-how and other information, whether technical or
non-technical, disclosed by one Party (hereinafter the “Disclosing Party”), or
otherwise became known, to the other Party (hereinafter the “Receiving Party”)
hereunder relating to the subject matter of this Agreement, regardless of form
or manner of disclosure, i.e., whether disclosed in writing, in electric file or
format or in other tangible manner, or orally, visually or in other intangible
manner and (b) any information that was disclosed by or on behalf of a Party or
any of its Affiliates to the other Party or any of its Affiliates prior to the
Effective Date pursuant to the confidentiality agreement between VERASTEM and
CHUGAI [***]. The existence and terms of this Agreement shall be deemed to be
the Confidential Information of both Parties.

 

10.2Notwithstanding the foregoing, Confidential Information shall not include
the information, which:

(a) was at the time of disclosure by the Disclosing Party hereunder publicly
known or available;

(b) after disclosure by the Disclosing Party hereunder, became publicly known or
available by publication or otherwise, other than by an unauthorized act or
omission by the Receiving Party;

(c)was in the possession of the Receiving Party without confidentiality
restriction at the

24

 

Exhibit 10.1

time of the disclosure by the Disclosing Party hereunder, as documented by the
Receiving Party’s business records;

(d) was lawfully received from any third party having the lawful right to make
such disclosure, without obligation of confidentiality; or

(e) was independently developed by the Receiving Party’s directors, officers or
employees without use of or reference to the Confidential Information, as
demonstrated by records contemporaneous with such development.

 

10.3The Receiving Party recognizes the proprietary and confidential nature of
the Disclosing Party’s Confidential Information and agrees that no right, title,
ownership, license, or interest of any character in the Disclosing Party’s
Confidential Information other than as specifically granted herein, is conveyed
or transferred to the Receiving Party. The Receiving Party further agrees to
maintain the Disclosing Party’s Confidential Information in strict confidence
and not to disclose or divulge the Disclosing Party’s Confidential Information,
in whole or in part, to any third party, and not use the Disclosing Party’s
Confidential Information for any purpose other than pursuing this Agreement. The
Receiving Party shall limit disclosure of the Disclosing Party’s Confidential
Information to its employees, directors, agents, contractors, consultants and
advisors who have a need to know the Disclosing Party’s Confidential Information
for the purpose of this Agreement, provided that, the Receiving Party shall
undertake procedures to ensure that each of its employees, directors, agents,
contractors, consultants and advisors to whom the Disclosing Party’s
Confidential Information is disclosed understands (i) the confidential nature of
the Disclosing Party’s Confidential Information and (ii) that he or she is under
an obligation to hold the Disclosing Party’s Confidential Information disclosed
strictly confidential.

 

10.4Notwithstanding the foregoing, VERASTEM may disclose CHUGAI’s Confidential
Information to its Affiliates, and then existing or prospective sublicensees and
subcontractors, including contract manufacturers, and CHUGAI may disclose
VERASTEM’s Confidential Information to its Affiliates, any co-owners of Licensed
Patents and third parties who are parties to any of the On-going Agreements,
 [***], and the MTA Study Agreement, and then existing or prospective
sublicensees and subcontractors in the event [***]; provided that the Party
disclosing the other Party’s Confidential Information shall assume full
responsibility for any failure by such third parties to treat such Confidential
Information as required under this Article 10.  Notwithstanding the foregoing,
CHUGAI may only disclose VERASTEM’s Confidential Information to third parties
who are parties to any of the On-going Agreements, the [***] and the MTA Study
Agreement (i) while such agreements are in full force and effect

25

 

Exhibit 10.1

(and not otherwise expired or terminated) and (ii) CHUGAI remains responsible
for supporting the studies pursuant to the such agreements (i.e., the obligation
to support the studies and/or applicable agreement has not been transferred from
CHUGAI to VERASTEM). In addition, VERASTEM may disclose CHUGAI’s Confidential
Information (including this Agreement and the terms herein) to the extent such
disclosure is reasonably necessary to actual or bona fide potential investors,
acquirors, lenders and other financial or commercial partners solely for the
purpose of evaluating or carrying out an actual or potential investment,
acquisition, debt transaction or collaboration; provided that in each such case
on the condition that such persons are bound by written, binding obligations of
confidentiality and non-use consistent with this Agreement

 

10.5In the event that the Disclosing Party’s Confidential Information is legally
required to be disclosed to any Governmental Authorities or courts or stock
exchanges having the legal authority to require such disclosure pursuant to
Applicable Law, the Receiving Party shall provide the Disclosing Party with
prompt notice so that the Disclosing Party may seek a protective order or other
appropriate remedy and/or waive compliance with the provisions of this
Agreement, and the Receiving Party shall cooperate with the Disclosing Party in
any effort the Disclosing Party may undertake. In the event that such protective
order or remedy is not obtained, or that the Disclosing Party waives compliance
with the provisions of this Agreement, the Receiving Party shall furnish only
that portion of the Disclosing Party’s Confidential Information which is legally
required and shall exercise its Commercially Reasonable Efforts to obtain
reliable assurance that confidential treatment will be accorded and disclosure
is limited to the extent possible.

 

11PUBLICATIONS

11.1Publication by CHUGAI

As of the Effective Date and thereafter and except as required by Applicable
Laws, CHUGAI shall not publish any Data or results relating to the Chugai
Compound or the Product without VERASTEM’s prior written approval. Prior to
submission of such Data or results for publication or presentation, CHUGAI shall
provide at least [***] days or, in exceptional circumstances, [***] days prior
to the intended submission, a copy of such proposed publication or presentation
to VERASTEM, who shall have [***] days to inform CHUGAI whether it approves or
does not approve the publication or presentation and to provide its comments,
which approval shall not be unreasonably withheld. If such publication or
presentation contains patentable matter which requires protection, the Parties
agree to delay such publication or presentation for an additional [***] days so
that the appropriate Party may

26

 

Exhibit 10.1

file for patent protection or to delete such patentable matter from such
proposed publication or presentation.

 

11.2Publication by VERASTEM

As of the Effective Date and thereafter, VERASTEM shall have the right to
publish any Data or results relating to the development of the Chugai Compound
or the Product including, but not limited to, any Data or results from
preclinical studies undertaken by academic institutions at the request of
VERASTEM or Data or results from clinical trials, including pursuant to On-going
Agreement 2. Furthermore, independent investigators, hospitals and academic
institutions that are entrusted by VERASTEM with the conduct of preclinical
studies or clinical trials of the Chugai Compound or the Product are understood
to operate in an academic environment and shall be allowed to release Data and
information regarding such preclinical or clinical trials in a manner consistent
with academic standards. Upon each publication pursuant to this Article 11.2,
VERASTEM shall use reasonable efforts to promptly notify CHUGAI of such
publication with the contents thereof.

 

11.3Publication by the Investigator

Prior to submission of the Data or results relating to the Chugai Compound or
the Product for publication or presentation by the investigator who initiated
study(ies) under and parties to any of the On-going Agreements, the MTA  Study
Agreement, or the [***], CHUGAI shall provide at least [***] days prior to the
intended submission, a copy of such proposed publication or presentation to
VERASTEM, who shall have [***] days to inform CHUGAI whether it contains
patentable matter which requires protection. If such publication or presentation
contains such patentable matter, CHUGAI will have the investigator delay such
publication or presentation for an additional [***] days so that the appropriate
Party may file for patent protection or to delete such patentable matter from
such proposed publication or presentation.  The Parties agree that the terms and
conditions of On-going Agreement 2 shall govern any  publications or
presentations relating to the research being conducted pursuant On-going
Agreement 2. 

 

11.4Press Release

Each Party shall issue a press release with mutually agreed content at an agreed
date or dates promptly following the execution of this Agreement. Subject to
Article 11.5, the Parties shall jointly discuss and agree in writing on any
statement to the public regarding this Agreement or any of its terms and when
either Party elects to make any such statement, it shall give the other Party at
least [***] Business Days to review and comment on such

27

 

Exhibit 10.1

statement.

 

11.5Required Disclosures

Each Party acknowledges that the other Party may be legally required to make
public disclosures (including in filings with Governmental Authorities) of
certain terms of or material developments or material information generated
under this Agreement and agrees

that each Party may make such disclosures as required by Applicable Laws,
provided that the Party seeking such disclosure (i) receives advice from counsel
that it is legally required to make such public disclosure and (ii) if
practicable and permitted by Applicable Laws, first provides the other Party a
copy of the proposed disclosure, and reasonably considers any comments thereto
provided by the other Party within [***] Business Days after the receipt of such
proposed disclosure.

A Party may disclose this Agreement in securities filings with the Securities
and Exchange Commission or equivalent foreign agency to the extent required by
Applicable Laws.  In such event, the Party seeking such disclosure shall prepare
a draft confidential treatment request and proposed redacted version of this
Agreement to request confidential treatment for this Agreement, and the other
Party agrees to promptly (and in any event, no more than [***] Business Days
after receipt of such confidential treatment request and proposed redactions)
give its input in a reasonable manner in order to allow the Party seeking
disclosure to file its request within the time lines prescribed by Applicable
Laws.  The Party seeking such disclosure shall reasonably consider any comments
thereto provided by the other Party within such [***] Business Day period.

 

12REPRESENTATIONS,  WARRANTIES AND COVENANTS

12.1Mutual Representations and Warranties 

Each Party hereby represents and warrants with respect to itself as follows:

(a)As of the Effective Date, it is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction in which it is
incorporated, and has full corporate power and authority and the legal right to
own and operate its property and assets and to carry on its business as it is
now being conducted and as contemplated in this Agreement.

(b)As of the Effective Date, (i) it has the full right and authority to enter
into this Agreement and perform its obligations hereunder, (ii) it is not aware
of any impediment that would prevent it from entering into this Agreement or
that would inhibit its ability to perform its obligations under this Agreement,
(iii) it has taken all necessary corporate actions on its part required to
authorize the execution and delivery of this Agreement and the performance of
its obligations hereunder, and (iv) this Agreement has been duly executed and
delivered

28

 

Exhibit 10.1

on behalf of such Party, and constitutes a legal, valid and binding obligation
of such Party that is enforceable against it in accordance with its terms.

(c)As of the Effective Date, (i) it has not entered into any agreement with any
third party that is in conflict with the rights granted to the other Party under
this Agreement, and has not taken any action that would in any way prevent it
from granting the rights granted to the other Party under this Agreement, or
that would otherwise materially conflict with or materially adversely affect the
rights granted to the other Party under this Agreement, and (ii) the performance
and execution of this Agreement will not result in a breach of any other
contract to which it is a party.

(d) As of the Effective Date, it is not aware of any action, suit, inquiry or
investigation instituted by any third party that questions or threatens the
validity of this Agreement.

(e)Such Party has, as of the Effective Date, the necessary qualified personnel,
equipment, know-how and other means to perform its duties under this Agreement
in a timely manner in accordance with the terms hereof.

(f)As of the Effective Date, all necessary consents, approvals and
authorizations of all Governmental Authorities and other persons required to be
obtained by such Party in connection with the execution and delivery of this
Agreement have been obtained.

 

12.2CHUGAI Representations and Warranties

CHUGAI hereby represents and warrants as follows:

(a)As of the Effective Date, CHUGAI owns or otherwise Controls the Licensed
Patents and Licensed Know-How, has the right to grant the license under Article
2.1 to VERASTEM, and it has not granted any license or other right under the
Licensed Patents and Licensed Know-How that is inconsistent with such license.

(b)As of the Effective Date, to the extent CHUGAI is required to pay a third
party financial consideration for the right to Control any Licensed Patent or
Licensed Know-How, VERASTEM shall not have any liability to pay or any other
responsibility with respect to such financial consideration.

(c)To the best of its knowledge as of the Effective Date, Relevant Data and
Information provided by CHUGAI or made available to VERASTEM in the virtual data
room are true and accurate.

(d)To the best of its knowledge as of the Effective Date, Relevant Data and
Information were generated from either (i) studies conducted following Good
Laboratory Practice regulations and guidelines (e.g. 21 CFR Part 58.1. Good
Laboratory Practice for nonclinical Laboratory Studies), if such studies are
required to follow such Good Laboratory Practice regulations and guidelines or
(ii) studies conducted following CHUGAI’s internal R&D

29

 

Exhibit 10.1

standards, if such studies are not required to follow Good Laboratory Practice
regulations and guidelines.

(e)As of the Effective Date of this Agreement, CHUGAI is not aware of or has not
received any claim or threat from any third party regarding infringement or
misappropriation of rights of any third party by exploiting (i) the Licensed
Patents or Licensed Know-How to be licensed under Article 2.1 or (ii) the Chugai
Compound or the Product.

(f)As of the Effective Date of this Agreement, there is no litigation pending or
threatened (in writing) against CHUGAI with respect to (i) all or any portion of
the Licensed Patents or Licensed Know-How to be licensed under Article 2.1 or
(ii) the Chugai Compound or the Product.

(g)To the best of its knowledge as of the Effective Date, CHUGAI has taken
reasonable measures to protect the confidentiality of any Confidential
Information in the Licensed Know-How.

(h)(i) Appendix I(A) attached hereto sets forth a true and correct list of all
Licensed Patents existing as of the Effective Date that cover the Chugai
Compound or Product in the Territory;  (ii) to the actual knowledge of CHUGAI as
of the Effective Date, such Licensed Patents that are issued as of the Effective
Date are valid and enforceable, and are being diligently prosecuted in good
faith in the respective patent offices in accordance with Applicable Laws; (iii)
to the actual knowledge of CHUGAI as of the Effective Date, except for (x)
 [***] and any and all patents and patent applications issuing therefrom or
claiming priority thereto worldwide; and (y)  [***] and any and all patents and
patent applications issuing therefrom or claiming priority thereto worldwide, no
material prior art or other facts are likely to render any claims in the
Licensed Patents  unpatentable or unenforceable; and (iv) all renewal and
maintenance fees due as of the Effective Date with respect to the prosecution
and maintenance of the Licensed Patents have been paid.

(i)As of the Effective Date, each person who has or has had any rights in or to
any Licensed Patents has assigned and executed an agreement assigning its entire
right, title and interest in and to such Licensed Patents to CHUGAI, provided
that no such assignment is required with respect to (x)  [***] and any and all
patents and patent applications issuing therefrom or claiming priority thereto
worldwide with respect to the ownership interest of [***], and (y)  [***], and
any and all patents and patent applications issuing therefrom or claiming
priority thereto worldwide with respect to the ownership interest of [***].

(j)To the best of its knowledge as of the Effective Date, [***] has not used any
proprietary process or technology patented by [***] to manufacture the CHUGAI
Compound or Product, as applicable.

 

30

 

Exhibit 10.1

12.3VERASTEM Representations and Warranties

VERASTEM hereby represents and warrants as follows:

(a)The license to VERASTEM under this Agreement is not reportable under the Hart
Scott Rodino Antitrust Improvements Act.

(b)[***]

 

12.4No Other Representations and Warranties

Except as expressly provided in this Agreement, the foregoing representations
and warranties are in lieu of, and EACH Party expressly disclaims, any and all
representations and warranties of any kind, express or implied, including
without limitation, WARRANTIES OF NON-INFRINGEMENT, VALIDITY OF PATENTS, DESIGN,
merchantability and fitness for a particular purpose.

 

12.5Compliance with Anti-Corruption Laws 

 

(a)Notwithstanding anything to the contrary in this Agreement, VERASTEM agrees
that:

(i)  it shall not, in the performance of this Agreement, perform any actions, or
permit its directors, officers, employees, agents, consignees, Affiliates,
sublicensees or subcontractors to perform any actions, that are prohibited by
local and other anti-corruption laws (including the provisions of the United
States Foreign Corrupt Practices Act, collectively “Anti-Corruption Laws”) that
may be applicable to one or both Parties; and

(ii)it shall not, in the performance of this Agreement, directly or indirectly,
make any payment, or offer or transfer anything of value, or agree or promise to
make any payment or offer or transfer anything of value, to a government
official or government employee, to any political party or any candidate for
political office or to any other third party with the purpose of influencing
decisions related to either Party or its business in a manner that would violate
Anti-Corruption Laws.

 

(b)If VERASTEM discovers any fact that VERASTEM is in breach of this Article
12.5, VERASTEM shall promptly notify CHUGAI thereof in writing.  If VERASTEM has
breached this Article 12.5 or CHUGAI reasonably believes that VERASTEM has
breached this Article 12.5,  then it shall be a material breach of this
Agreement pursuant to which CHUGAI may terminate, subject to the terms of
Article 9.3.3.1.  If CHUGAI terminates pursuant to Article 9.3.3.1, then, for
the avoidance of doubt, CHUGAI shall not be prevented from seeking damages or
any other remedies for the damages or losses arising out of or in connection

31

 

Exhibit 10.1

with VERASTEM’s breach of this Article 12.5.

 

13INDEMNIFICATION

13.1Indemnification by VERASTEM 

VERASTEM shall indemnify, hold harmless and defend CHUGAI and its Affiliates and
their respective directors, officers, employees and agents (collectively the
“CHUGAI Indemnitees”) from and against any and all claims, demands, law suits
and/or causes of action (whether criminal or civil, in contract, tort or
otherwise)  brought by a third party (“Claims”) for losses, damages, expenses,
costs of defense (including without limitation reasonable attorneys’ fees, court
costs, witness fees, damages, judgments, fines and amounts paid in settlement)
and any other amounts (collectively “Losses”) arising from (i) a breach by
VERASTEM of its obligations under this Agreement; or (ii) the negligence or
willful misconduct of VERASTEM, or its Affiliates, or any of their respective
officers, employees or agents.  Notwithstanding the foregoing, VERASTEM shall
not be required to indemnify the CHUGAI Indemnitees for any Losses pursuant to
this Article 13.1 to the extent that (i) such Losses arise from a breach by
CHUGAI Indemnitees of any of CHUGAI’s obligations under this Agreement, or (ii)
such Losses arise or result from the negligence or willful misconduct of any
CHUGAI Indemnitee.

 

13.2Indemnification by CHUGAI 

CHUGAI shall indemnify, hold harmless and defend VERASTEM and its Affiliates and
their respective directors, officers, employees and agents (collectively the
“VERASTEM Indemnitees”) from and against any and all Claims resulting in Losses
arising from (i) a breach by CHUGAI of its obligations under this Agreement; or
(ii) the negligence or willful misconduct of any CHUGAI Indemnitee. 
Notwithstanding the foregoing, CHUGAI shall not be required to indemnify the
VERASTEM Indemnitees for any Losses pursuant to this Article 13.2 to the extent
that (i) such Losses arise from a breach by VERASTEM Indemnitees of any of
VERASTEM’s obligations under this Agreement, or (ii) such Losses arise or result
from the negligence or willful misconduct of any VERASTEM Indemnitee.

 

13.3Claims 

In the event of a Claim against either Party or any person entitled to
indemnifications under this Agreement (“Indemnified Party”), the Indemnified
Party shall promptly notify the other Party having the indemnification
obligation under this Agreement with respect to such Claim (such Party, the
“Indemnifying Party”) in writing of the Claim with detailed information. The
Indemnifying Party shall have the right to assume the defense of any such Claim
for which it

32

 

Exhibit 10.1

is obligated to indemnify the Indemnified Party under this Article 13. The
Indemnified Party shall cooperate with the Indemnifying Party (and its insurer)
as the Indemnifying Party may reasonably request, and at the Indemnifying
Party’s sole cost and expense. The Indemnified Party shall have the right to
participate, at its own expense and with counsel of its choice, in the defense
of any Claim that has been assumed by the Indemnifying Party. The Indemnifying
Party shall have no obligation to indemnify an Indemnified Party in connection
with any settlement made without the Indemnifying Party’s prior written consent.
If the Parties cannot agree as to the application of this Article 13 to any
Claim, the Parties may conduct separate defenses of such Claim, with each Party
retaining the right to claim indemnification from the other in accordance with
this Article 13 upon resolution of the underlying Claim.

 

13.4Insurance

Each Party shall use reasonable endeavors to be self-insured, or to procure and
maintain adequate insurance coverage, at its own cost, by reputable insurance
companies, covering its respective liabilities under this Agreement.

 

14LIMITATION OF LIABILITY

NOTWITHSTANDING ANYTHING EXPRESS OR IMPLIED IN THIS AGREEMENT TO THE CONTRARY,
IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR LOSS OF PROFITS,
SPECIAL, INDIRECT, INCIDENTAL, PUNITIVE OR CONSEQUENTIAL DAMAGES ARISING OUT OF
THIS AGREEMENT.  NOTWITHSTANDING THE FOREGOING, NOTHING IN THIS ARTICLE 14 IS
INTENDED TO OR SHALL LIMIT OR RESTRICT THE INDEMNIFICATION RIGHTS OR OBLIGATIONS
OF ANY PARTY UNDER ARTICLE 13,  OR DAMAGES AVAILABLE FOR A PARTY’S BREACH OF ITS
OBLIGATIONS HEREUNDER RELATING TO CONFIDENTIALITY.

 

15NOTICES

15.1Save as otherwise provided in this Agreement, any notice, demand or other
communication (“Notice”) to be given by either Party under, or in connection
with, this Agreement shall be in writing and signed by, on behalf of, the Party
giving it. Any Notice shall be served by delivering it by hand, mailing by
certified or registered airmail (postage prepaid, return receipt required) or
delivering by internationally recognized overseas courier to the address set out
in Article 15.2 hereof and in each case marked for the attention of the relevant
Party set out in Article 15.2 hereof (or as otherwise notified from time to time
in accordance with the provisions of Article 15.1 hereof). Any Notice so served
shall be deemed to have been duly given or made as follows:

33

 

Exhibit 10.1

 

(a)in the case of delivery by hand, when delivered;

(b)in the case of delivery by certified or registered airmail, seven (7) days
after posting date; and

(c)in the case of delivery by internationally recognized overseas courier, on
the first Business Day after dispatch,

 

15.2The addressees and facsimile numbers of the Parties for the purpose of
Article 15.1 hereof are as follows:

 

(a)VERASTEM

 

Address:Verastem, Inc.

117 Kendrick Street, Suite 500

Needham, Massachusetts 02494

United States

To the attention of:  [***]

With a copy to: [***]

(b)CHUGAI

 

Address:Chugai Pharmaceutical Co., Ltd.
2-1-1 Nihonbashi-Muromachi
Chuo-ku, Tokyo 103-8324
Japan

 

To the attention of:    [***]

 

16GOVERNING LAW AND DISPUTE RESOLUTION

16.1Governing Law

This Agreement, and all claims or causes of action (whether in contract, tort or
statute) that may be based upon, arise out of or relate to this Agreement, or
the negotiation, execution or performance of this Agreement or the breach
thereof, shall be governed by, and enforced in accordance with, the laws of the
State of New York, United States without regard to principles of conflicts of
laws.

34

 

Exhibit 10.1

 

16.2Dispute Resolution

16.2.1The Parties shall negotiate in good faith and use Commercially Reasonable
Efforts to settle any and all disputes, controversies or differences arising out
of, in relation to or in connection with this Agreement (a “Dispute”).  Any
Dispute shall be referred to senior management of each Party for attempted
resolution.  In the event senior management are unable to resolve such Dispute
within [***] days of such Dispute being referred to then, then upon the written
request of either Party to the other Party, the Dispute shall be subject to
arbitration in accordance with Article 16.2.2.

 

16.2.2In the event of a Dispute that cannot be resolved between the Parties or
senior management as set forth in Article 16.2.1, such Dispute shall be referred
to and finally and exclusively settled by arbitration in accordance with the
Rules of Arbitration of the International Chamber of Commerce. The tribunal of
arbitration shall consist of three (3) arbitrators. Each Party shall select one
(1) arbitrator, and the two (2) arbitrators so selected shall choose a third
arbitrator who will act as the chairman of the tribunal. Such arbitration shall
be held in London, England. The arbitration shall be conducted in English. Each
Party shall bear its own costs and expenses relating to the arbitration unless
the arbitrators determine that a Party has incurred unreasonable expenses due to
vexatious or bad faith positions taken by the other Party, in which event the
arbitrators may make an award of all or any portion of such expenses (including
legal fees and expenses) so incurred.  The award rendered by arbitration shall
be final and binding upon both Parties and judgment upon the award may be
entered into in any court having jurisdiction for enforcement thereof. The
Parties shall treat all matters relating to the arbitration, including, but not
limited to, the existence of the arbitration, all documents produced by one
Party in the arbitration, or the award rendered by the arbitration as
confidential. Notwithstanding the foregoing, (i) either Party may seek
preliminary injunctive relief for a breach or a threatened breach of any term by
the other Party in any court of competent jurisdiction and (ii) any dispute,
controversy or claim relating to the scope, validity, enforceability or
infringement of any Patent or Trademark right shall be submitted to a court of
competent jurisdiction in the country in which such Patent or Trademark rights
were granted or arose.

 

17MISCELLANEOUS

17.1Independent Contractor

Neither Party shall be deemed an agent nor representative of the other Party for
any purpose, and this Agreement shall not create or establish an agency. Except
as may be

35

 

Exhibit 10.1

specifically provided herein, neither Party shall have any right, power, or
authority, nor shall they represent themselves as having authority to assume,
create or incur any expense, liability or obligation, express or implied, on
behalf of the other Party, or otherwise act as an agent for the other Party for
any purpose. The Parties agree that the relationship of VERASTEM and CHUGAI
established by this Agreement is that of an independent licensee and licensor.
This Agreement does not, is not intended to, and shall not be construed, to
establish a partnership or joint venture.

 

17.2Third Parties

This Agreement is neither expressly nor impliedly made for the benefit of any
entity other than the Parties, and neither any third party nor any Affiliate
shall have any claim against either Party on the basis of this Agreement.

 

17.3Further Actions

From time to time during the Term, either Party shall at the reasonable request
of the other Party (i) deliver to the other Party records, data or other
documents consistent with the provisions of this Agreement, (ii) execute and
deliver, or cause to be delivered, all such assignments, consents, documents or
further instruments of transfer or license, and (iii) take or cause to be taken
all such other actions, as the other Party may reasonably deem necessary or
desirable in order for such Party to obtain the full benefits of this Agreement
and the transactions contemplated thereby, including without limitation
registration of the license granted under this Agreement and amendment of claims
of Licensed Patents, if necessary.

 

17.4Entire Agreement

This Agreement, including all the Appendices, sets forth the entire
understanding of the Parties with respect to the subject matter hereof and
cancels and supersedes all previous communications, representations or
understandings, and agreements, whether oral or written, between the Parties
relating to the subject matter hereof.

 

17.5Amendment

No modification or amendment of any provision of this Agreement shall be valid
or effective unless made in writing and signed by a duly authorized
representative of each Party.

 

17.6Assignment

Neither Party may assign, transfer, charge or otherwise encumber this Agreement

36

 

Exhibit 10.1

or any right, benefit or interest under it, without the prior written consent of
the other Party, which consent shall not be unreasonably
withheld.  Notwithstanding the foregoing, either Party may assign this Agreement
without the consent of the other Party to any Affiliate or to any successor in
interest by way of merger, stock purchase, consolidation, acquisition or sale of
all or substantially all of its assets to which this Agreement relates, provided
that such successor agrees in writing to be bound by the terms of this Agreement
as if it were the assigning Party. This Agreement shall be binding upon the
successors and permitted assigns of the Parties.

 

17.7Performance by Affiliates

Each Party acknowledges that obligations under this Agreement may be performed
by Affiliates of VERASTEM and CHUGAI. Each Party guarantees and warrants any
performance of this Agreement by its Affiliates. Wherever in this Agreement, the
Parties delegate responsibility to their Affiliates, the Parties agree that such
Affiliates may not make decisions inconsistent with this Agreement, amend the
terms and conditions of this Agreement or act contrary to the terms and
conditions of this Agreement in any way.

 

17.8Force Majeure

Any prevention, delay or interruption of non-monetary performance (collectively
“Delay”) by either Party under this Agreement shall not be a breach of this
Agreement if and to the extent caused by occurrences beyond the reasonable
control of the Party affected by the force majeure event, including but not
limited to acts of God, embargoes, governmental restrictions, terrorism, general
strike, fire, flood, earthquake, explosion, riots, wars or war like operations
(declared or undeclared), civil disorder, rebellion or sabotage. The affected
Party shall endeavor to notify the other Party to the extent possible upon the
occurrence and end of the Delay. During the Delay, any time for performance
hereunder by either Party shall be extended by the actual time of Delay.

 

17.9Severability

If any of the provisions of this Agreement are held to be void or unenforceable
by a court of competent jurisdiction, then such void or unenforceable provisions
shall be replaced by valid and enforceable provisions which will achieve as far
as possible the economic and business intentions of the Parties. However, the
remainder of this Agreement shall remain in full force and effect, provided that
the material interests of the Parties are not affected i.e., the Parties would
presumably have concluded this Agreement without the unenforceable provisions.

37

 

Exhibit 10.1

 

17.10Waiver

A waiver of any default, breach or non-compliance under this Agreement shall not
be effective unless signed by the Party to be bound by the waiver. No waiver
shall be inferred from or implied by any failure to act or delay in acting by a
Party in respect of any default, breach, non-observance or by anything done or
omitted to be done by the other Party. The waiver by a Party of any default,
breach or non-compliance under this Agreement shall not operate as a waiver of
that Party’s rights under this Agreement in respect of any continuing or
subsequent default, breach or non-compliance.

 

17.11No Right to Use Names

Except as otherwise provided herein, this Agreement provides no grant of right
to a Party, express or implied, to use in any manner the corporate or business
names or Trademarks of the other Party or its Affiliates.

 

17.12Legal Compliance

Either Party shall observe any and all Applicable Laws in the conduct of its
activities under this Agreement, and undertakes to make and fulfil any and all
formalities in connection with all such activities which may be required under
Applicable Laws. The Parties further agree to comply with the current applicable
Good Laboratory Practices, Good Clinical Practices and Good Manufacturing
Practices, and apply a high standard of ethics in the conduct of its activities
under this Agreement.

 

17.13Language

This Agreement has been drafted in the English language, and the English
language shall control its interpretation. Any translation shall be for
convenience purposes only and shall not be legally binding.

 

17.14Interpretation

The Parties agree that the terms and conditions of this Agreement are the result
of negotiations between the Parties and that this Agreement shall not be
construed in favor of or against either Party by reason of the extent to which
such a Party participated in the drafting of this Agreement.  The captions to
the Articles hereof are not a part of this Agreement, but are merely for
convenience to assist in locating and reading the Articles of this Agreement.

 

38

 

Exhibit 10.1

17.15Fees and Expenses

VERASTEM and CHUGAI shall each pay their respective legal and other fees and
expenses associated with all aspects of the transaction contemplated hereunder,
including the negotiation of this Agreement.

 

17.16Counterparts

The Parties shall execute this Agreement in two (2) counterparts, each of which
shall be deemed an original, but which together shall constitute one and the
same instrument.

 

 

39

 

Exhibit 10.1

IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by
their duly authorized representatives as of the Effective Date.

 

 

VERASTEM, INC.:CHUGAI PHARMACEUTICAL CO., LTD.:

 

 

 

 

By:  /s/ Brian StuglikBy:  /s/ Tatsuro Kosaka

Name:Brian Stuglik, R.Ph.Name: Tatsuro Kosaka

Title:  CEOTitle: President and CEO

Date: January 7, 2020Date: January 7, 2020

 

 

 

 

 

 

 

40

 

Exhibit 10.1

APPENDIX:

 

APPENDIX I(A):    Licensed Patents

APPENDIX I(B):  [***]

APPENDIX II:On-going Agreements

APPENDIX III:Technical Transfer

APPENDIX IV:Opt-back Rights

APPENDIX V:[***]

APPENDIX VI:Inventory

APPENDIX VII:  [***]

 

 

41

 

Exhibit 10.1

APPENDIX I(A)

Licensed Patents

[***]

 

 

42

 

Exhibit 10.1

APPENDIX I(B)

[***]

[***]

[***]

[***]

[***]

[***]

[***]

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[***]

 

 

[***]

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[***]

 

 

[***]

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[***]

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[***]

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[***]

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[***]

[***]

[***]

[***]

 

 

 

 

 

43

 

Exhibit 10.1

APPENDIX II

On-going Agreements

 

[***]

 

 

 

44

 

Exhibit 10.1

APPENDIX III

Technical Transfer

 

[***]

 

[***]

[***]

[***]

[***]

[***]

[***]

[***]

 

 

 

[***]

[***]

[***]

[***]

[***]

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[***]

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[***]

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[***]

 

[***]

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45

 

Exhibit 10.1

 

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46

 

Exhibit 10.1

APPENDIX IV

Opt-Back Rights

 

Any agreement governing an Opt-Back Right shall, among others, include the
following terms and conditions:

 

1.

License to CHUGAI

VERASTEM shall grant to CHUGAI an exclusive (including with regard to VERASTEM
and its Affiliates) license under the Licensed Patents, Licensed Know-How,
VERASTEM Improvements and VERASTEM’s rights in Joint Improvements, to develop,
have developed, register, have registered, make, have made, manufacture, have
manufactured, use, have used, distribute, have distributed, market and have
marketed (including the right to detail and promote), offer to sell, have
offered to sell, sell, have sold, import and have imported the Chugai Compound
and/or the Product in the Field in the EU (with respect to an exercise of the EU
Opt-Back Right) and/or Japan and Taiwan (with respect to an exercise of the
Japan Opt-Back Right).

VERASTEM shall transfer and CHUGAI may use all of the Data generated by VERASTEM
during the Development and Commercialization of the Chugai Compound to fulfil
the requirements of Applicable Laws or regulations or the request of a
 Governmental Authority in the territory applicable to the Opt-Back Right being
exercised. 

 

2.Consideration for License

As consideration for the license and transfer of Data referenced above in
Section 1 of this Appendix IV,  CHUGAI shall pay a % of [***] costs [***]
VERASTEM has spent up to and including the effective date of the agreement
governing the Opt-Back Right to generate the Data in the pre-clinical and
clinical study of the Chugai Compound and/or Product, [***] 

If VERASTEM generates additional Data after the effective date of the agreement
governing the Opt-Back Right, including without limitation through a
multi-national clinical trial that may or may not include the EU, Japan and
Taiwan, and CHUGAI desires to reference that Data in its own territories, then
CHUGAI shall pay a %  of [***] costs [***] VERASTEM has spent to generate such
Data in the pre-clinical and clinical study of the Chugai Compound and/or
Product, [***]    

CHUGAI shall not be obliged to pay any consideration (milestone or royalty) for
the development or commercialization of the Chugai Compound and/or the Product
in the territories where CHUGAI exercised the Opt-Back Right other than
explicitly set forth in this APPENDIX IV.

47

 

Exhibit 10.1

Upon exercise of CHUGAI’s Opt-back Right, VERASTEM’s obligation for the royalty
payment in accordance with Article 6.3 shall be based on the Net Sales of the
Product in the Territory excluding the countries where CHUGAI exercised the
Opt-Back Right.

 

3.  Manufacturing and Supply

VERASTEM shall supply to CHUGAI and CHUGAI agrees to purchase from VERASTEM, any
and all requirements of the Product for development and commercialization in the
countries where CHUGAI exercised the Opt-Back Right.  [***]    

The supply price for the Product shall be VERASTEM’s Fully-Burdened
Manufacturing Cost plus [***].  The parties shall negotiate and enter into a
separate Supply Agreement and Quality Agreement with respect to the supply of
the Product.

 

4.  Trademark

(i) CHUGAI has the right to choose, with respect to any Product to be
commercialized by CHUGAI in countries where CHUGAI exercises the Opt-Back Right,
whether to use a Product Trademark owned by VERASTEM or to use a different
Trademark selected by CHUGAI.

(ii) In the event CHUGAI elects to use any Product Trademark owned by VERASTEM,
VERASTEM shall grant  a perpetual, royalty-free license, with the right to
sublicense, to use or practice such Product Trademark in the countries where
CHUGAI exercises the Opt-Back Right. 

 

5  Governance

The Parties shall establish a Joint Committee to oversee and control the
implementation of the agreement between the Parties with respect to the global
Development and Commercialization of the Product. VERASTEM shall have the final
decision-making authority in the Territory except with respect to the EU and
Japan and Taiwan, as applicable.  CHUGAI shall have the final decision-making
authority in the EU and Japan and Taiwan, as applicable, unless the decision
could adversely impact the Product outside the EU and Japan and Taiwan, in which
case VERASTEM shall have the final decision-making authority.

48

 

Exhibit 10.1

 

APPENDIX V

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49

 

Exhibit 10.1

APPENDIX VI

 

Inventory

 

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50

 

Exhibit 10.1

APPENDIX VII

 

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51