Exhibit 10.6
Text Marked By [* * *] Has Been Omitted Pursuant To A Request For Confidential
Treatment And
Was Filed Separately With The Securities And Exchange Commission.
AMENDMENT NO. 5 TO THE
PATENT AND TECHNOLOGY LICENSE AGREEMENT
     This AMENDMENT NO. 5 to the PATENT AND TECHNOLOGY LICENSE AGREEMENT between
the PARTIES dated September 11, 2006, as amended on December 21, 2007,
September 3, 2008, July 8, 2009, and February 11, 2010 (the “LICENSE
AGREEMENT”), effective the 10th day of January, 2011 (“AMENDMENT NO. 5 EFFECTIVE
DATE”, which is the date this AMENDMENT NO. 5 has been fully executed by all
PARTIES), is made by and between: (1) THE BOARD OF REGENTS (“BOARD”) of THE
UNIVERSITY OF TEXAS SYSTEM (“SYSTEM”), an agency of the State of Texas, whose
address is 201 West 7th Street, Austin, Texas 78701, on behalf of THE UNIVERSITY
OF TEXAS M. D. ANDERSON CANCER CENTER (“UTMDACC”), a member institution of
SYSTEM; (2) THE HENRY M. JACKSON FOUNDATION FOR THE ADVANCEMENT OF MILITARY
MEDICINE, INC. (“HJF”), a Maryland tax-exempt corporation, whose address is 1401
Rockville Pike, Suite 600, Rockville, Maryland 20852, on its own behalf and on
behalf of THE UNIFORMED SERVICES UNIVERSITY OF THE HEALTH SCIENCES (“USU”), an
institution of higher learning within the Department of Defense, an agency of
the United States Government, located at 4301 Jones Bridge Road, Bethesda,
Maryland 20814-4779; and (3) APTHERA, INC. (formerly known as ADVANCED PEPTIDE
THERAPEUTICS, INC.; hereafter referred to as “LICENSEE”). BOARD, HJF and
LICENSEE may be referred to herein collectively as the “PARTIES.”
RECITALS

A.   The LICENSE AGREEMENT requires LICENSEE to achieve certain performance
milestones and funding requirements within a specified period of time and to pay
annual maintenance fees and/or running royalties on a certain schedule.   B.  
LICENSEE seeks additional time in which to complete certain required milestones
and obtain funding as referenced herein and also seeks to alter the annual
maintenance fee schedule and annual minimum royalty schedule. BOARD and HJF wish
to allow LICENSEE additional time to complete such milestones and obtain such
funding. BOARD and HJF are also willing to alter the annual maintenance fee
schedule and royalty schedule. BOARD and HJF accordingly agree to modify the
LICENSE AGREEMENT as set forth herein rather than terminate the LICENSE
AGREEMENT or assert a breach of the

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    LICENSE AGREEMENT based upon LICENSEE’s past noncompliance with the
milestones, funding obligations, or payment schedules referenced herein.

C.   Accordingly, BOARD, HJF and LICENSEE desire to amend the LICENSE AGREEMENT
pursuant to the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the mutual covenants contained herein, the
sufficiency of which is hereby acknowledged, the PARTIES hereby agree to the
following:
AMENDMENT

1.   A new Section 2.17 is hereby added to the LICENSE AGREEMENT as follows:

  2.17   FINANCING means either (a) a financing in connection with a reverse
merger into an existing public company immediately after which LICENSEE’s
shareholders own a majority of the outstanding shares and LICENSEE’s management
is the surviving management of the merged company; or (b) other financing or
financings when in combination with or in lieu of the reverse merger, including,
but not limited to, debt, convertible debt, private equity, and grants; provided
that such financing(s) in the case of either (a) or (b) will net LICENSEE a
minimum aggregate funding of $2.0 million.

2.   A new section 2.18 is hereby added to the LICENSE AGREEMENT as follows:

  2.18   EXCLUSIVE MARKETING RIGHTS means exclusive rights granted by the U.S.
government to market (a) a drug for a rare disease or condition (“Orphan Drug”)
pursuant to the U.S. FDA Code of Federal Regulations, Title 21, Chapter I,
Subchapter D, Part 316 (entitled “Orphan Drugs”), enacted pursuant to 21 U.S.C.
Part B (entitled “Drugs for Rare Diseases or Conditions”), as may be amended or
modified, and/or (b) a biological drug pursuant to the Biologics Price
Competition and Innovation Act of 2009, 42 U.S.C. § 262(k)(7)(A).

3.   A new section 2.19 is hereby added to the LICENSE AGREEMENT as follows:

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  2.19   CLINICAL DEADLINE means the date that is fifteen (15) months from the
date of the completion of the FINANCING.

4.   A new section 2.20 is hereby added to the LICENSE AGREEMENT as follows:

  2.20   REGISTRATION CLINICAL TRIAL means a late-stage clinical trial such as a
PHASE III CLINICAL TRIAL or PHASE II/III CLINICAL TRIAL intended for the purpose
of supporting an NDA.

5.   Section 4.1(d)(iii) of the LICENSE AGREEMENT shall be deleted in its
entirety and replaced with the following:

      4.1(d)(iii) (A) [***] due within ten (10) calendar days after the
AMENDMENT NO. 5 EFFECTIVE DATE, and (B) [***] due in quarterly payments of [***]
beginning on the date that is sixty (60) calendar days following completion of
the FINANCING and every ninety (90) calendar days thereafter. In the event that
LICENSEE raises a net $6 million or more in the FINANCING, the quarterly
payments due under Section 4.1(d)(iii)(B) shall become due and payable within
ten (10) calendar days of raising such funds;

6.   Section 4.1(d)(iv) of the LICENSE AGREEMENT shall be deleted in its
entirety and replaced with the following:

      4.1(d)(iv) [***] due on or before August 1, 2011; and

7.   Section 4.1(d)(v) of the LICENSE AGREEMENT shall be deleted in its entirety
and replaced with the following:

      4.1(d)(v) [***] due on or before August 1, 2012; and

8.   Section 4.1(e) of the LICENSE AGREEMENT shall be deleted in its entirety
and replaced with the following:

      4.1(e) Beginning on September 30, 2012, LICENSEE shall pay UTMDACC, on a
quarterly basis (with a quarterly payment due on September 30, 2012), the
greater of: (i)

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      an annual minimum royalty of [***] (payable in four equal quarterly
installments of [***] each); or (ii) a running royalty (payable quarterly as set
forth in Section 4.3, below) which shall be equal to the combined total of all
of the following running royalties:     (i)   as to NET SALES of LICENSED
PRODUCTS in a given jurisdiction covered by at least one VALID CLAIM existing in
such jurisdiction at the time of the relevant SALE: (1) [***]% of the first
[***] of such NET SALES; (2) [***]% of the second [***] of such NET SALES; and
(3) [***]% of all such NET SALES in excess of [***]; and     (ii)   as to NET
SALES of any LICENSED PRODUCT in a given jurisdiction not covered by any VALID
CLAIM existing in such jurisdiction at the time of the relevant SALE: (1) [***]%
of the first [***] of such NET SALES; (2) [***]% of the second [***] of such NET
SALES, and (3) [***]% of all such NET SALES in excess of [***]; and

9.   Section 4.1(f) shall be deleted in its entirety and replaced with the
following:

      4.1(f) The following one-time milestone payments:

      Milestone   Milestone Payment
(i) Commencement of PHASE III CLINICAL TRIAL for a LICENSED PRODUCT
  [***]
 
   
(ii) Filing of an NDA for a LICENSED PRODUCT
  [***]
 
   
(iii) MARKETING APPROVAL of a LICENSED PRODUCT
  [***]
 
   
(iv) First SALE of a LICENSED PRODUCT
  [***]
 
   
(v) Completion of FINANCING
  [***]

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      For purposes hereof, “Commencement” means administration of the first dose
to a human. The milestone payment set forth in subsection 4.1(f)(v) shall be
paid by LICENSEE within ten (10) calendar days of the completion of FINANCING
regardless of whether any or all other milestones have been met; all other of
the foregoing milestone payments in Sections 4.1(f)(i)—(iv) shall be made by
LICENSEE to UTMDACC within thirty (30) calendar days of achieving the milestone
event. The milestone payments in this Section 4.1(f) shall [***] reduce the
amount of any other payment provided for in this ARTICLE IV; and

10.   A new section 4.10 is hereby added to the LICENSE AGREEMENT as follows:

  4.10   The parties shall have no obligations under Section 4.8 and Section 4.9
hereof after the completion of the FINANCING.

11.   Section 13.1 shall be deleted in its entirety and replaced with the
following:

  13.1   Subject to Sections 13.2, 13.3, and 13.4 hereinbelow, the term of this
AGREEMENT is from the EFFECTIVE DATE to the longer of (a) five (5) years from
the date upon which all PATENT RIGHTS have expired, or all claims in the PATENT
RIGHTS have been declared invalid or unenforceable by a court or tribunal in a
final decision not subject to further appeal, or have been abandoned, or (b) the
date upon which EXCLUSIVE MARKETING RIGHTS for a LICENSED PRODUCT have expired;
provided, however, that if EXCLUSIVE MARKETING RIGHTS for a LICENSED PRODUCT are
not in existence on the date set forth in (a) above, then the term shall expire
on the date set forth in (a) above.

12.   Section 13.3(c) is deleted in its entirety and is replaced with the
following:

  13.3 (c)   Upon forty-five (45) calendar days written notice from UTMDACC, if
LICENSEE fails to initiate a REGISTRATION CLINICAL TRIAL in the intended patient
population of node positive, HER2 1+ and/or 2+ breast cancer in the United
States, the European Union, Eastern Europe, Japan, India, China, or other

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      country(ies) as may be mutually agreed by all of the parties hereto on or
before the CLINICAL DEADLINE, unless before the end of such forty-five
(45) calendar day period, LICENSEE provides evidence satisfactory to UTMDACC
that it has initiated the REGISTRATION CLINICAL TRIAL. For the avoidance of
doubt, LICENSEE must initiate a REGISTRATION CLINICAL TRIAL on or before the
CLINICAL DEADLINE unless specifically requested or demanded otherwise by a
strategic collaborative partner (identified by LICENSEE in writing to UTMDACC)
or the U.S. FDA or equivalent foreign regulatory agency, and LICENSEE’s failure
to so initiate a REGISTRATION CLINICAL TRIAL in the absence of such request or
demand shall be a basis for termination of this AGREEMENT. LICENSEE may extend
the CLINICAL DEADLINE as follows:

  i.   At the election of the LICENSEE, prior to the CLINICAL DEADLINE LICENSEE
may pay to UTMDACC a [***] extension fee (the “Option 1 Fee”) and receive a six
(6) month extension of the CLINICAL DEADLINE (as extended, the “Option 1
Clinical Trial Date”);     ii.   Upon LICENSEE’s timely payment of the Option 1
Fee and upon the mutual agreement of the parties, prior to the Option 1 Clinical
Trial Date LICENSEE may pay to UTMDACC a [***] extension fee (the “Option 2
Fee”) and receive a second six (6) month extension of the Option 1 Clinical
Trial Date (as extended, the “Option 2 Clinical Trial Date”);     iii.   Upon
LICENSEE’s timely payments of the Option 1 Fee and the Option 2 Fee and upon the
mutual agreement of the parties, prior to the Option 2 Clinical Trial Date
LICENSEE may pay to UTMDACC a [***] extension fee (the “Option 3 Fee”) and
receive a third six (6) month extension of the Option 2 Clinical Trial Date (as
extended, the “Option 3 Clinical Trial Date”); or

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13.   Section 13.3(d) of the LICENSE AGREEMENT shall be deleted in its entirety
and replaced with the following:

          13.3 (d):   upon thirty (30) calendar days written notice from UTMDACC
if LICENSEE fails to complete a FINANCING and provide evidence of the same to
UTMDACC within six (6) months of the AMENDMENT NO. 5 EFFECTIVE DATE; or

14.   A new section 13.5 is hereby added to the LICENSE AGREEMENT as follows:

  13.5   In the event the AGREEMENT is terminated prior to commencement of
marketing of any LICENSED PRODUCT due to LICENSEE’s default, the parties agree
that all assets related to an investigational new drug, NDA, efforts to obtain
MARKETING APPROVAL, or any clinical trial program (i.e., scientific data,
clinical trial study documents and results, workbooks and laboratory reports and
results, etc.) shall become the property of UTMDACC and HJF. In the event
UTMDACC and HJF wish to acquire bulk active, work in process or finished good
inventory from LICENSEE related to one or more LICENSED PRODUCTS, LICENSEE
agrees to negotiate in good faith for a fair market price to sell such
inventory.

15.   LICENSEE shall pay UTMDACC an amendment fee (in consideration for UTMDACC
and HJF allowing this amendment) of [***] within fifteen (15) calendar days
after the AMENDMENT NO. 5 EFFECTIVE DATE.

16.   Immediately prior to the close of the FINANCING, (a) LICENSEE shall
purchase one hundred percent (100%) of UTMDACC’s common shares of LICENSEE [***]
for [***] paid to UTMDACC; and (b) LICENSEE shall purchase one hundred percent
(100%) of HJF’s common shares of LICENSEE [***] for [***] paid to HJF. UTMDACC
and HJF agree that the payments for shares received from LICENSEE under this
Section 16 of AMENDMENT NO. 5 shall not be subject to distribution as LICENSE
REVENUE under Section 6.2 of the Inter-Institutional Sharing Agreement dated
February 9, 2006 between UTMDACC and HJF.

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17.   LICENSEE shall pay UTMDACC all outstanding patent expenses incurred by
UTMDACC as of the AMENDMENT NO. 5 EFFECTIVE DATE (in the amount of [***]) within
ten (10) calendar days after the AMENDMENT NO. 5 EFFECTIVE DATE. LICENSEE’s
obligations with respect to the payment of patent expenses set forth in the
LICENSE AGREEMENT (including, for example, obligations in Sections 4.1(a) and
6.1) shall remain in effect and are not otherwise amended hereby.   18.   The
PARTIES acknowledge and agree that, except as set forth in this AMENDMENT NO. 5,
the terms and conditions of the LICENSE AGREEMENT shall remain unchanged and in
full force and effect; provided, however, that nothing contained in the LICENSE
AGREEMENT shall have the effect of preventing or limiting, in any way, the terms
of this AMENDMENT NO. 5. If any conflict arises between the terms of this
AMENDMENT NO. 5 and the terms of the LICENSE AGREEMENT, this AMENDMENT NO. 5
shall govern as to the conflicting terms.   19.   This AMENDMENT NO. 5 shall be
binding upon and inure to the benefit of the PARTIES hereto and their respective
heirs, administrators, executors, successors, and assigns.

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     IN WITNESS WHEREOF, the PARTIES hereto have caused their duly authorized
representatives to execute this AMENDMENT NO 5.

                      BOARD OF REGENTS OF THE       APTHERA, INC.     UNIVERSITY
OF TEXAS SYSTEM                
 
                   
By
  /s/ John Mendelsohn, M.D.       By   /s/ Robert E. Kennedy    
 
 
 
         
 
   
 
  John Mendelsohn, M.D.           Name: Robert E. Kennedy    
 
  President           Title: President and CFO    
 
  The University of Texas                
 
  M. D. Anderson Cancer Center                   Date: 1/10/11       Date:
12/18/10    
 
                    THE UNIVERSITY OF TEXAS                 M. D. ANDERSON
CANCER CENTER       THE HENRY M. JACKSON FOUNDATION    

By
 
/s/ Leon Leach       FOR THE ADVANCEMENT OF
MILITARY MEDICINE, INC.    
 
                   
 
  Leon Leach
Executive Vice President      
By  
/s/ John W. Lowe    
 
                   
 
  The University of Texas           John W. Lowe    
 
  M. D. Anderson Cancer Center           President    
 
                    Date: 1/5/11       Date: 12/20/10    
 
                    Approved as to Content:                
 
                   
By
  /s/ Christopher C. Capelli
 
Christopher C. Capelli                
 
  Vice President, Technology Transfer                
 
  M. D. Anderson Cancer Center                
 
                    Date: 12/21/10                

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