Exhibit 10.36

EXECUTION COPY

EXCLUSIVE LICENSE AGREEMENT

THIS EXCLUSIVE LICENSE AGREEMENT (“Agreement”) is entered into this 24th day of
November 2008 (“Effective Date”) by and between THE UNIVERSITY OF WESTERN
AUSTRALIA, a body corporate established pursuant to the provisions of The
University of Western Australia Act 1911, with offices at 35 Stirling Highway,
Crawley, Western Australia 6009 (“UWA”), and AVI BIOPHARMA, INC., an Oregon
corporation, with offices at 4575 S.W. Research Way, Suite 200, Corvallis,
Oregon 97333 USA (“Licensee”).

RECITALS

A. UWA owns and is entitled to grant license rights with respect to certain
Patent Rights and Technical Information (as defined below) invented or developed
in the course of certain research conducted under the direction of Stephen D.
Wilson, Sue Fletcher and Graham McClorey (hereinafter collectively referred to
as the “Inventors”).

B. Certain of the Patent Rights and Technical Information had been previously
assigned by UWA to SmithKline Beecham Corporation doing business as
GlaxoSmithKline (“GSK”), as evidenced by the agreement effectuating the
assignment attached hereto as APPENDIX A, but have, as of the Effective Date,
been reassigned by GSK to UWA, as evidenced by the agreement effectuating the
reassignment to he attached hereto as APPENDIX B.

C. Licensee is in the process of developing various products for the treatment
of Duchenne Muscular Dystrophy by inducing the skipping of certain exons for
which the Patent Rights and Technical Information may be useful.

D. UWA desires to have the Patent Rights and the Technical Information
developed, used and commercialized in the Field of Use (as defined below) by
Licensee, and Licensee desires to obtain an exclusive, worldwide license to
conduct research in the Field of Use, and to develop, manufacture, use and sell
Products (as defined below) in the Field of Use, using the Patent Rights and
Technical Information in accordance with the terms of this Agreement, Other than
the rights expressly granted by UWA hereunder within the Field of Use, Licensee
acknowledges that UWA shall retain all other rights with respect to the Patent
Rights and the Technical Information.

NOW, THEREFORE, in consideration of the mutual covenants and premises herein
contained, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:

 

1. DEFINITIONS

1.1 “Affiliate” or “Affiliates” shall mean any corporation, person or entity,
which controls, is controlled by, or is under common control with, a party to
this Agreement without regard to stock or other equity ownership. For purposes
hereof, the terms “control” and “controls” mean the possession, direct or
indirect, of the power to direct or cause the direction of the management and
policies of a corporation, person or entity, whether through the ownership of

 

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voting securities, by contract or otherwise.

1.2 “Confidential Information” shall mean any confidential or proprietary
information furnished by one party (the “Disclosing Party”) to the other party
(the “Receiving Party”) in connection with this Agreement, including, without
limitation, all specifications, know-how, trade secrets, technical information,
drawings, software, models, business information and patent applications
pertaining to the Patent Rights and Technical Information, and as further
provided in Section 10 hereof.

1.3 “Exons of Interest” means dystrophin exons 51, 45, 44, 53, 46, 50, 8 and/or
52.

1.4 “FDA” shall mean the United States Food and Drug Administration, or any
successor agency thereof.

1.5 “Field of Use” shall mean the treatment of Duchenne Muscular Dystrophy by
inducing the skipping of the Exons of Interest and/or by skipping blocks of
exons that include any or all of the Exons of Interest through the use of those
antisense sequences listed in the Patent Rights.

1.6 “Future Patent Rights” shall mean any patents and/or patent applications
claiming Inventions invented after the Effective Date the Valid Claims of which,
absent a license by UWA, would be infringed by Licensee, its Affiliates or its
sublicensees by the sale of Products in the Field of Use.

1.7 “Future Technical Information” shall mean the following information in the
Field of Use developed after the Effective Date and described in Future Patent
Rights: know-how, trade secrets, unpublished patent applications, software,
bioinformatics, unpatented technology, technical information, statistical
information and analyses, biological materials, chemical reagents, preclinical
and clinical information, and any and all confidential and proprietary
information described in the Future Patent Rights.

1.8 “Invention” shall mean all unpatented, patentable and patented inventions,
discoveries, designs, apparatuses, systems, machines, methods, processes, uses,
devices, models, composition of matter, technical information, trade secrets,
know-how, codes, programs or configurations of any kind which are in the Field
of Use.

1.9 “Net Sales” shall mean the total invoiced sales price and/or value of other
consideration received for Products and sold by Licensee or an Affiliate
thereof, less (a) sales taxes or other taxes, (b) actual shipping and insurance
costs, (c) actual rebates, credits, or refunds for returned or defective
Products, (d) trade discounts and quantity discounts or retroactive price
reductions, (e) rebates, credits, and chargeback payments (or the equivalent
thereof) actually granted to managed health care organizations, wholesalers, or
to federal, state/provincial, local and other governments, including their
agencies, purchasers, and/or reimbursers, or to trade customers, and (f) any
import or export duties, tariffs, or similar charges incurred with respect to
the import or export of Products into or out of any country in the Territory.
Products will be

 

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considered “sold” when put into use, sold, leased or otherwise transferred and a
“sale” shall be deemed to have occurred upon first use, shipment, invoicing or
receipt of payment, whichever shall first occur. Notwithstanding the foregoing,
Net Sales shall not include, and shall be deemed zero with respect to, (i) the
actual distribution of reasonable quantities of promotional samples of Products,
and (ii) Products provided for clinical trials or research purposes at cost or
at no charge. Notwithstanding the foregoing, in the event that a Product is sold
by Licensee as part of a combination product or bundled product (“Combination
Product”), the Net Sales of such Product, for the purposes of determining
royalty payments due under this Agreement, shall be determined by multiplying
the Net Sales (as originally defined above) of the combination product by the
fraction A/(A+B), where A is the average sale price of the Product when sold
separately in finished form in any country in which the Combination Product is
sold and B is the average sale price of the other product(s) included in the
Combination Product when sold separately in finished form, so that A+B is the
average sale price of the Combination Product(s) together, in the country in
which the Combination Product is sold, in each case during the applicable
royalty reporting period in which sales of both occurred, or, if sales of both
the Product and the other product(s) did not occur in such period, then in the
most recent royalty reporting period in which sales of both occurred. In the
event that such average sale price cannot be determined for both the Product and
such other product(s) in the Combination Product, Net Sales for the purposes of
determining royalty payments with respect to such Combination Product shall be
mutually agreed by the parties based on the relative value contributed by each
component, such agreement not to be unreasonably withheld.

1.10 “Patent Rights” shall mean International PCT Patent Application No.
PCT/AU2005/000943, filed on June 28, 2005 and published as PCI’ Publication No.
WO 2006/000057, and all patents and/or patent applications (including
provisional patent applications) existing as of the Effective Date in any other
country corresponding to any of the foregoing, and all national phases,
divisions, continuations, continuations-in-part, reissues, reexaminations,
supplementary protection certificates and extensions thereof, whether domestic
or foreign, and any patent that issues thereon. The Patent Rights are all owned
by UWA.

1.11 “Phase II Trial” shall mean a controlled clinical study conducted to
evaluate the effectiveness of a Product for the treatment of Duchenne Muscular
Dystrophy, for example by testing muscle function or endurance, in patients
having Duchenne Muscular Dystrophy and to determine the common short-term side
effects and risks.

1.12 “Phase III Trial” shall mean, relative to a Phase II Trial, expanded
controlled and uncontrolled trials after preliminary evidence suggesting
effectiveness of the Product for treatment of Duchenne Muscular Dystrophy has
been obtained, and intended to gather additional information to evaluate the
overall benefit-risk relationship of the Product and to provide an adequate
basis for applying for regulatory approval for commercial sales of the Product.

1.13 “Product” or “Products” shall mean any human therapeutics, diagnostics
(including algorithms or any components thereof, bioinformatics and any other
human health care products and/or services in the Field of Use utilizing or
derived in any manner whatsoever

 

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from any of the Patent Rights or Technical Information, which Product(s), except
for the license granted hereunder, would infringe a Valid Claim of the Patent
Rights.

1.14 “Technical Information” shall mean, as of the Effective Date, the following
information in the Field of Use which is described in the Patent Rights:
know-how, trade secrets, unpublished patent applications, software,
bioinformatics, unpatented technology, technical information, statistical
information and analyses, biological materials, chemical reagents, preclinical
and clinical information, in each case which has been conceived or reduced to
practice prior to the Effective Date, in the conduct by UWA of the research
associated with the Patent Rights. Technical Information is all owned by UWA.

1.15 “Territory” shall moan the entire world.

1.16 “Valid Claim” shall mean a claim of an issued patent included within the
Patent Rights, which claim has not (a) lapsed, been canceled or become
abandoned, (b) been declared invalid or unenforceable by a non-appealable
decision or judgment of a court or other appropriate body or authority of
competent jurisdiction (other than with respect to any petition or writ of
certiorari to the Supreme Court of the United States), or (c) been admitted to
be invalid or unenforceable through reissue, disclaimer or otherwise.

 

2. LICENSE

2.1 Grant of Exclusive Rights. Subject to the terms of this Agreement, UWA
hereby grants to Licensee, and Licensee hereby accepts from UWA, the exclusive,
worldwide license, with the right to grant sublicenses (subject to the terms of
Section 2.4 hereof), during the term of this Agreement (as provided in Section 6
hereof) to conduct research in the Field of Use using the Patent Rights and the
Technical Information and to develop, use, make, have made, practice, import,
carry out, manufacture, have manufactured, offer for sale, sell and/or have sold
Products in the Field of Use in the Territory using the Patent Rights and the
Technical Information. Notwithstanding any other provision hereof to the
contrary, all rights to the Patent Rights and the Technical Information outside
of the Field of use are retained by UWA (for purposes of clarity, the parties
agree that UWA retains the right to research and commercialize sequences for
exons outside the Field of Use).

2.2 Diligence. Licensee shall use commercially reasonable efforts in pursuing
the development, commercialization and marketing of Products. Licensee shall be
deemed to have exercised commercially reasonable efforts, and the diligence
requirements of this Section 2.2 shall be deemed to have been met, if Licensee,
together with its Affiliates and sublicensees, meets the respective requirements
set forth on Schedule 1, with each such requirement being deemed a separate and
independent condition (each, a “Milestone”). If Licensee, together with its
Affiliates and sublicensees, fails to meet any Milestone designated in
Schedule 1 hereto, UWA may, at its option and as its sole remedy for Licensee’s
breach of this Section 2.2, upon written notice to Licensee as provided under
Section 6.2(a) (“Milestone Breach Notice”) and if Licensee fails to cure such
breach within sixty (60) days of such Milestone Breach Notice (rather than
thirty (30) days as described in Section 6.2(a)) or if UWA does not agree to a
modification to the relevant Milestone(s) to obviate such breach, terminates the
Agreement; provided, however;

 

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that before issuing a Milestone Breach Notice the Parties shall first meet to
discuss the status of Licensee’s development efforts and UWA shall consider in
good faith whether such efforts amount to commercially reasonable efforts under
the circumstances, and if UWA determines that such efforts do not constitute
commercially reasonable efforts under the circumstances, then UWA have the
option to issue a Milestone Breach Notice.

2.3 Conditions to Effectiveness. The following shall be a condition precedent to
the effectiveness of this Agreement: the agreement effectuating the reassignment
of patent rights (attached hereto as APPENDIX B) shall have been fully executed
and delivered by UWA and GSK.

2.4 Right to Sublicense or Assign Rights. Licensee shall have the right to grant
sublicenses consistent with this Agreement. Licensee shall keep UWA reasonably
informed with respect to the progress of any relations entered into with any
sublicensees, As an express condition of any such sublicense, any such
sublicensee shall be required to agree in writing to be bound by commercially
reasonable royalty reporting and recordkeeping, indemnification and inspection
provisions, and the applicable provisions of this Agreement, including, without
limitation, those pertaining to the use of UWA’s name and marks, indemnification
of UWA and the use of UWA’s Confidential Information. Licensee will be
responsible for enforcing each sublicensee’s obligations under its sublicense.
Licensee understands and agrees that none of its sublicenses hereunder shall
reduce in any manner any of its obligations set forth in this Agreement.

2.5 Certain Future Rights. UWA shall promptly notify Licensee of any Future
Patent Rights and Future ‘technical Information and such Future Patent Rights
and Future Technical Information shall be automatically included in the license
granted hereunder as Patent Rights and Technical Information, respectively,
under Section 2.1.

 

3. REPRESENTATIONS AND WARRANTIES

3.1 UWA. UWA represents and warrants to Licensee that:

(a) UWA (i) is a body corporate established pursuant to the provisions of The
University of Western Australia Act 1911, duly organized, validly existing and
in good standing under the laws of Australia, (ii) has the corporate power and
authority to enter into this Agreement and to perform its obligations hereunder,
and (Hi) has taken sufficient steps such that the execution and delivery of this
Agreement by UWA and the performance by UWA of its obligations hereunder have
been duly authorized by all necessary corporate action;

(b) to the best of UWA’s knowledge, at the Effective Date, there are no claims,
judgments or settlements to be paid by UWA with respect to the Patent Rights or
Technical Information or pending claims or litigation relating to the Patent
Rights or Technical Information;

(c) with respect to the Patent Rights, UWA has been assigned all right title and
interest from the Inventors and GSK, as the case may be, and UWA is either
(i) listed as the sole owner of record in the records of the United States
Patent and Trademark Office and any

 

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foreign patent offices with respect to Patent Rights that consist of
applications or registrations with such offices, or (ii) employing diligent and
commercially reasonable efforts to become listed as the sole owner of record in
the records of the United States Patent and Trademark Office and any foreign
patent offices with respect to Patent Rights that consist of applications or
registrations with such offices for those Patent Rights that have been
reassigned to UWA from GSK;

(d) UWA has the right to grant the rights granted to Licensee hereunder and to
perform UWA’s obligations hereunder, in each case without the consent or
approval of any third party;

(e) UWA has not granted, and will not grant, licenses to the Patent Rights,
Technical Information, Future Patent Rights or Future Technical Information to
any third party that would conflict with or otherwise compromise the rights
granted to Licensee hereunder;

(f) the Patent Rights have been duly prepared, filed, prosecuted, obtained, and
maintained in accordance with all applicable laws, rules, and regulations;

(g) to the best of UWA’s knowledge, no third party’s intellectual property
rights would be infringed or misappropriated by the practice of the Patent
Rights in general and no third party is infringing or misappropriating the
Patent Rights;

(h) UWA does not own or control any patents or patent applications other than
the Patent Rights that currently, or when issued, would be infringed by the
making, using, offering for sale, selling, or importing of any product or
process covered by a claim within the Patent Rights;

(i) this Agreement constitutes the legal, valid and binding obligation of UWA,
enforceable against UWA in accordance with its terms, subject only to
(i) applicable bankruptcy, insolvency, reorganization, moratorium or similar
laws affecting the enforceability of creditors’ rights generally, (ii) the
limitation that the remedy of specific performance or injunctive relief is
subject to the discretion of the court or arbitrator before which any proceeding
therefor may be brought, and (iii) general legal and equitable principles of
good faith, fair dealing and equity; and

(j) to the best of UWA’s knowledge, neither the execution or delivery of this
Agreement by UWA, nor the performance by UWA of its obligations hereunder,
(i) requires the consent or approval of any third party; (ii) shall constitute a
default under any material contract by which UWA or any of its material assets
is bound (or any event which, with notice or lapse of time, or both, would
constitute such a default); or (iii) shall constitute a violation of any
judgment, order or decree of any court, arbitrator, governmental agency or
authority binding upon UWA.

For the avoidance of doubt:

 

  •  

UWA does not warrant or represent that the Patent Rights or Technical
Information or any part thereof are or will be valid under this agreement.

 

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  •  

UWA makes no warranties or representations, including as to the accuracy or
completeness of any scientific information provided in respect of this
agreement.

 

  •  

UWA does not warrant the applicability, utility or usability of the Patent
Rights or the Technical Information in respect of the Products and disclaims any
and all liability in respect of the application of the Patent Rights or the
Technical Information.

3.2 Licensee. Licensee represents and warrants to UWA that:

(a) Licensee is a corporation duly organized, validly existing and in good
standing under the laws of the State of Oregon and has the corporate power and
authority to enter into this Agreement and to perform its obligations hereunder;

(b) the execution and delivery of this Agreement by Licensee and the performance
by Licensee of its obligations hereunder have been duly authorized by all
necessary corporate action;

(c) this Agreement constitutes the legal, valid and binding obligation of
Licensee, enforceable against Licensee in accordance with its terms, subject
only to (i) applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting the enforceability of creditors’ rights generally,
(ii) the limitation that the remedy of specific performance or injunctive relief
is subject to the discretion of the court or arbitrator before which any
proceeding therefor may be brought, and (iii) general legal and equitable
principles of good faith, fair dealing and equity; and

(d) neither the execution or delivery of this Agreement by Licensee, nor the
performance by Licensee of its obligations hereunder, (i) requires the consent
or approval of any third party; (ii) shall constitute a default under any
material contract by which Licensee or any of its material assets is bound (or
any event which, with notice or lapse of time, or both, would constitute such a
default); or (iii) shall constitute a violation of any judgment, order or decree
of any court, arbitrator, governmental agency or authority binding upon Licensee

 

4. CONSIDERATION

In consideration of the execution and delivery by UWA of this Agreement,
Licensee agrees as follows:

4.1 License Fee. Within three (3) days of the Effective Date, Licensee shall:

(a) pay to UWA an upfront license fee in an amount equivalent to Twelve Thousand
Five Hundred U.S. Dollars (USD 12,500) exclusive of any applicable taxes; and

(b) reimburse UWA for any payment actually made by UWA to GSK, as evidenced by
UWA’s written records, for the sole purpose of securing the reassignment of the
Patent Rights from GSK to UWA; provided, however; that such reimbursement shall
be no more than Twenty-Five Thousand U.S. Dollars (USD 25,000).

 

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4.2 Payment of Royalties.

(a) Licensee shall pay, or cause to be paid, to UWA aggregate royally fees
(each, a “Royalty” and collectively, the “Royalties”) equal to the following
received by Licensee, its Affiliates or its sublicensees:

(i) 0.75% of Net Sales of Product in the United States; provided, however, that
if the Valid Claims in the United States cover the specific base sequence of the
Product for which such Royalty is due but do not provide a meaningful ability
for Licensee to exclude from the market other products with different base
sequences that cause skipping of the same dystrophin exon as the Product, then
the royalty rate shall be reduced to 0.50% of Net Sales for such Product; and

(ii) 1.25% of Net Sales of Product outside the United Stales; provided, however,
that, on a country-by-country basis, if the Valid Claims cover the specific base
sequence of the Product for which such Royalty is due but do not provide a
meaningful ability for Licensee to exclude from the market other products with
different base sequences that cause skipping of the same dystrophin exon as the
Product, then the royalty rate in any such country shall be reduced to 0.75% of
Net Sales for such Product

(b) Royalties shall accrue and be payable by Licensee on a quarterly basis
within forty-five (45) days following the end of each calendar quarter in which
any Products generating Net Sales were sold. Each payment of Royalties shall be
accompanied by a statement setting forth in reasonable detail the number and
each type of Product sold and the Net Sales applicable thereto. The Products
shall be considered as being sold for the purpose of the calculation of
Royalties under this Agreement when the payments for such Products have been
received by Licensee. Except as otherwise provided in Section 4.5, all Royalties
shall be paid in United States Dollars and shall be made without set off and
free and clear of (and without any deduction or withholding for) any taxes,
duties, levies, imposts or similar fees or charges.

(c) Licensee shall create and maintain complete and accurate records and
documentation concerning all Net Sales of Products by Licensee, its Affiliates
and sublicensees in sufficient detail to enable the Royalties payable hereunder
to he determined. Licensee shall retain such records and documentation for not
less than three (3) years from the date of their creation. During the term of
this Agreement and for a period of one (I) year thereafter, UWA and its
representatives shall have the right to audit such records and documentation as
shall pertain to the determination and payment of Royalties no more than once in
any calendar year. Such examiners shall have reasonable access during regular
business hours to Licensee’s offices and the relevant records, files and books
of account, and shall have the right to examine any other records reasonably
necessary to determine the accuracy of the Royalty calculations provided by
Licensee. The costs of any such audit shall be borne by UWA, unless as a result
of such inspection it is determined that the amounts payable by Licensee for any
period are in error by greater than five percent (5%), in which case the costs
of such audit shall be borne by Licensee. UWA shall report the results of any
such audit to Licensee within forty-five (45) days of completion. Thereafter,
Licensee shall promptly pay to UWA the amount of any underpayment discovered in
such audit, or UWA shall credit to Licensee against future Royalty payments the

 

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amount of any overpayment discovered in such audit, as the case may be. In
addition, Licensee shall pay interest on any underpayment at the rate that is
the lower of (i) two percent (2%) over the rate of interest announced by Bank of
America in Portland, Oregon (or any successor in interest thereto or any
commercially equivalent financial institution if no such successor exists) to be
its “prime rate,” or (ii) the highest rate permitted by applicable law, from the
date such amount was underpaid to the date payment is actually received.

4.3 Milestone Fees.

(a) Licensee shall pay to UWA certain fees (each, a “Milestone Fee”), which
shall be determined and paid within thirty (30) days after the occurrence of
each of the following corresponding events (each, a “Milestone Event”) and which
shall apply only to the first two Products that reach the first of such
Milestone Events under Section 4.3(a)(i);

(i) Ten Thousand U.S. Dollars (USD 10,000) upon initiation of a Phase II Trial
of a Product (for purposes of clarity, the parties understand and agree that the
clinical trial of AVI-4658 scheduled to begin in Q4 2008 is a Phase Ib trial and
not a Phase II Trial);

(ii) Fifteen Thousand U.S. Dollars (USD 15,000) upon initiation of a Phase III
Trial of a Product;

(iii) Twenty Thousand U.S. Dollars (USD 20,000) upon submission of a new drug
application (“NDA”) to the FDA or equivalent in the European Union for market
approval of a Product; and

(iv) Thirty Thousand Dollars (USD 30,000) upon approval of a NDA or equivalent
in the European Union allowing commercialization of the Product described in
Section 4.3(e).

(b) If a Valid Claim specifically covering a Product has not issued in the
United States or European Union at the time a Milestone Event for such Product
occurs, Licensee shall be entitled to defer payment of 50% of the corresponding
Milestone Fee until such time, if any, that such Valid Claim is granted.

4.4 Infringement. In the event that Licensee is legally prevented from
commercializing one or more Products as a result of patent infringement issues,
all of Licensee’s obligations with respect to such Products, including, without
limitation, Royalty, Milestone Fees and other payment obligations related to
that particular Product hi that jurisdiction shall be suspended unless and until
such patent infringement issues are resolved. In the event that any such issues
are not resolved during the term of the Agreement, or in the event that such
issues are resolved in a manner that would continue to prevent Licensee from
commercializing such Products, then Licensee shall have no further obligations
hereunder with respect to such Products.

4.5 Currency Transfer Restrictions. If any restrictions on the transfer of
currency exist in any country or other jurisdiction so as to prevent Licensee
from making payments to

 

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UWA, Licensee shall take all commercially reasonable steps to obtain a waiver of
such restrictions or to otherwise enable Licensee to make such payments. If
Licensee is unable to do so, Licensee shall make such payments to UWA in a bank
account or other depository designated by UWA in such country or jurisdiction,
which payments shall be in the local currency of such country or jurisdiction,
unless payment in United States Dollars is permitted. Any payment by Licensee to
UWA in currencies other than United States Dollars shall be calculated using the
appropriate foreign exchange rate for such currency quoted in the Wall Street
Journal for the close of business of the last banking day prior to the date on
which such payment is being made.

4.6 Fair Market Value. UWA acknowledges and agrees that the Royalties, Milestone
Fees and other obligations of Licensee under this Agreement constitute fair
market value for the rights granted to Licensee under this Agreement based on
arms’-length negotiations with Licensee.

 

5. PATENT RIGHTS

5.1 Prosecution. Commencing on the Effective Date, Licensee shall assume full
responsibility for the application, maintenance, reexamination, reissue,
opposition and prosecution of any kind (collectively “Prosecution”) relating to
the Patent Rights in the Territory, including, but not limited to, payment of
all costs, fees and expenses related thereto. Licensee shall provide UWA with
copies of any and all material or communications with the United States Patent
and Trademark Office or any foreign patent office. Licensee shall consult with
UWA as to whether and how to proceed with respect to any event in connection
with Prosecution. In the event that Licensee elects to abandon the Prosecution
or maintenance of any patent or patent application included in the Patent
Rights, Licensee shall notify UWA of such election at least thirty (30) days
before a final due date which would result in abandonment or bar of
patentability of the patent or patent application and, in such event, UWA may,
at its sole option and expense, continue Prosecution or maintenance of the
Patent Rights. In the event that Licensee elects not to pursue subject matter in
the course of Prosecution that is outside the Field of Use, then the parties
will consult with one another in a good faith effort to determine how to
proceed.

5.2 Future Patent Rights. Section 5.1 shall not apply to any Future Patent
Rights that are included in this Agreement after the Effective Date. UWA shall
provide Licensee with copies of any and all material or communications with the
United States Patent and Trademark Office or any foreign patent office in
connection with Prosecution of the Future Patent Rights, and Licensee shall be
afforded the opportunity of prior review and comment on such action or paper. In
the event that UWA elects to abandon the Prosecution or maintenance of any
patent or patent application included in the Future Patent Rights, UWA shall
notify Licensee of such election at least thirty (30) days before a final due
date which would result in abandonment or bar of patentability of the patent or
patent application and, in such event, Licensee may, at its sole option and
expense, continue Prosecution or maintenance of the patent application or
patent.

5.3 Expenses. Licensee shall pay all expenses resulting from its obligations in
Section 5.1 hereof. UWA shall exercise reasonable efforts to cause the Inventors
to cooperate

 

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fully with Licensee with respect to the Prosecution, maintenance and protection
of the Patent Rights and Future Patent Rights.

 

6. TERM AND TERMINATION

6.1 Term. Unless earlier terminated as provided in Section 6.2 hereof, the term
of this Agreement shall commence on the Effective Date and shall expire, on a
country-by-country basis, on the date upon which the last to expire of the
patents covering the Patent Rights or a Valid Claim shall expire.

6.2 Termination. Except as provided by Section 6.3 hereof, this Agreement shall
terminate upon the earliest to occur of the following:

(a) Upon sixty (60) days’ written notice from UWA if, within such sixty (60) day
period, Licensee shall fail to cure fully any breach or default of any material
obligation under this Agreement as described in such written notice detailing
the facts of such breach with reasonable specificity; provided, however, that
Licensee may avoid such termination if, before the end of such sixty (60) day
period, such breach or default has been cured by Licensee to the reasonable
satisfaction of UWA;

(b) Upon sixty (60) days’ written notice from Licensee if, within such sixty
(60) day period, UWA shall fail to cure fully any breach or default of any
material obligation under this Agreement as described in such written notice
detailing the facts of such breach with reasonable specificity; provided,
however, that UWA may avoid such termination if, before the end of such sixty
(60) day period, such breach or default has been cured by UWA to the reasonable
satisfaction of Licensee;

(c) Upon the mutual written agreement of the parties hereto (such termination to
be effective as of the date mutually agreed upon in such written agreement);

(d) Immediately upon Licensee passing a resolution for winding-up (otherwise
than for the purposes of a solvent amalgamation or reconstruction where the
resulting entity is at least as credit-worthy as the Licensee and assumes all of
the obligations of the Licensee under this Agreement) or a court shall make an
order to that effect; or if a liquidator, receiver, administrator,
administrative receiver, manager, trustee, or similar officer is appointed over
any of the assets of the Licensee; or

(e) Immediately upon notice by Licensee that it is no longer desirous of
commercializing Products.

6.3 Obligations Upon Termination. Upon any termination of this Agreement
pursuant to Section 6.2 hereof, nothing herein shall be construed to release any
party from any liability for any obligation incurred through the effective date
of termination or for any breach of this Agreement prior to the effective date
of such termination. Licensee may, for a period of one (1) year after the
effective date of such termination, sell all tangible Products customarily

 

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classified as “inventory” that it has on hand at the date of termination,
subject to payment by Licensee to UWA of the applicable Royalty under Section 4
hereof.

6.4 Effect of Termination. In the event of any termination of this Agreement
pursuant to Section 6.2 hereof, where such termination has not been caused by
any action or inaction on the part of any sublicensee of Licensee or by any
breach by such sublicensee of its obligations under its sublicense from
Licensee, such termination of this Agreement shall be without prejudice to the
rights of each non-breaching sublicensee of Licensee and each non-breaching
sublicensee shall be deemed to be a licensee of UWA thereunder, and UWA shall be
entitled to all rights, but shall not be subject to any obligations (other than
the grant of license and appurtenant obligations under this Agreement to the
extent provided for in such sublicense) of Licensee thereunder.

6.5 Right to Institute Legal Actions. Notwithstanding the provisions of
Section 6.2 hereof, UWA, on the one hand, and Licensee, on the other hand, may
institute any other legal action or pursue any other remedy against the other
party permitted by applicable law if the other party does not substantially cure
any breach or default of any material obligation as provided herein.

6.6 Reversion of Rights. Notwithstanding anything to the contrary set forth
herein (including, but not limited to, Section 5 hereof), full responsibility
for Prosecution of the Patent Rights shall, at the option of UWA and at its sole
expense from the date of reversion, revert to UWA upon any termination of this
Agreement.

 

7. INFRINGEMENT AND PROSECUTION BY THIRD PARTIES

7.1 Enforcement. Licensee shall have the first right and the obligation to
enforce, at its sole expense, any Patent Rights to the extent licensed hereunder
against infringement by third parties and shall notify UWA in writing in advance
of all such enforcement efforts. Upon Licensee’s undertaking to pay all
expenditures reasonably incurred by UWA, UWA shall reasonably cooperate in any
such enforcement and, as necessary, join as a party therein. Licensee shall
reimburse UWA for all expenses, including reasonable attorneys’ fees, incurred
in connection with any such enforcement. In the event that Licensee does not
file suit against or commence and conclude settlement negotiations with a
substantial infringer of Patent Rights within ninety (90) days of receipt of a
written demand from UWA that Licensee bring suit, then the parties will consult
with one another in an effort to determine whether a reasonably prudent licensee
would institute litigation to enforce the patent in question in light of all
relevant business and economic factors (including, but not limited to, the
projected cost of such litigation, the likelihood of success on the merits, the
probable amount of any damage award, the prospects for satisfaction of any
judgment against the alleged infringer, the possibility of counterclaims against
the parties hereto, the impact of any possible adverse outcome on Licensee and
the effect any publicity might have on the parties’ respective reputations and
goodwill). If, after such process, it is determined that a suit should be filed
and Licensee does not file suit or commence settlement negotiations forthwith
against the infringer, then UWA shall have the right, at its own expense, to
enforce any Patent Rights licensed hereunder on behalf of itself and Licensee.
Any amount

 

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recovered in any such action or suit, whether by judgment or settlement, shall
be paid to or retained entirely by whichever party brought the action, or where
both parties participate in such action or suit, all such amounts shall be
allocated to each party in the ratio of expenses incurred, after first paying
each party’s out-of-pocket expenses, including reasonable attorneys’ fees.

7.2 Defense of Patent Rights. In the event that any Patent Rights are the
subject of a legal action seeking declaratory relief or of any reexamination or
opposition proceeding instituted by a third party, then Licensee shall hear the
expenses, including attorneys’ fees, associated with such defense and in any
recoupment of expenses, and UWA shall assist and cooperate with Licensee in such
proceedings and shall exercise reasonable efforts to cause the Inventors to
assist and cooperate fully.

7.3 Third Party Patent Rights. If Licensee reasonably determines that any
Product infringes upon the rights of a third party because of the use of the
Patent Rights, Future Patent Rights, Technical Information or Future Technical
Information in the manufacture, use or sale of such Product, and, as a result,
Licensee elects to oppose, seek reexamination of, pursue declaratory relief with
respect to and/or undertake other legal action with respect to such third
party’s patent(s) or patent application(s) before a patent office and/or the
courts of any jurisdiction in the Territory (collectively “Opposition”), then
UWA shall assist and cooperate with Licensee in any such Opposition. UWA shall
exercise reasonable efforts to cause the Inventors to cooperate fully with
Licensee at Licensee’s expense with respect to any Opposition.

 

8. INDEMNIFICATION

8.1 Indemnification by Licensee. UWA shall not be liable for any loss or damage
sustained by Licensee or any other person directly or indirectly from or in
connection with Licensee’s use, license or commercialization of any part of the
Products, Patent Rights, Future Patent Rights, Technical Information or Future
Technical Information, except to the extent that such loss or damages results
from the negligence or willful acts or omissions of UWA. Subject to Section 8.3
hereof, Licensee hereby releases and indemnifies UWA, its officers, employees
and agents (each, a “UWA Indemnified Party”, and collectively, the “UWA
Indemnified Parties”) from and against all actions, claims, proceedings and
demands whatsoever, including through contract and tort which may be made or
brought by any person, body or authority against it or them or any of them in
respect of any loss, injury or damage including death and consequential loss
arising out of Licensees’ use of the Products, Patent Rights, Future Patent
Rights, Technical Information or Future Technical Information, except to the
extent that such Losses result from the negligence, or willful acts or omissions
of UWA.

8.2 Indemnification by UWA. Subject to Section 8.3 hereof, UWA shall hold
harmless, defend and indemnify’ Licensee and each of its officers, directors,
employees and agents from and against any and all claims, damages, losses,
liabilities, costs and expenses (including reasonable attorneys’ fees and
expenses and costs of investigation, whether or not suit is filed) suffered or
incurred in connection with any negligence, willful acts or omissions or breach
on the part of UWA directly resulting from the assignment (attached hereto as
APPENDIX A) or reassignment (attached hereto as APPENDIX B) of the Patent Rights
between UWA and GSK.

 

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8.3 Notice of Claim. The parties shall promptly notify one another in writing of
any claim, action or material threat thereof brought against any party in
respect of which indemnification may be sought hereunder, and, to the extent
allowed by law, shall reasonably cooperate with the indemnifying party in
defending or settling any such claim or action. No settlement of any claim,
action or threat thereof received by a party and for which that party intends to
seek indemnification (for itself or on behalf of any other party) shall be made
without the prior joint written approval of UWA and Licensee.

 

9. USE OF NAMES

Neither party shall, unless as required by any law or governmental regulation,
use the name of the other party and/or any of its trademarks, service marks,
trade names or fictitious business names without express prior written consent
of the other party.

 

10. CONFIDENTIALITY

10.1 Non-Disclosure. The parties hereto shall keep the terms of this Agreement
and all business and scientific discussions relating to the business of the
parties strictly confidential. It may, from time to time, be necessary for the
parties, in connection with performance under this Agreement, to disclose
Confidential Information (including know-how) to each other. The Receiving Party
(as defined in Section 1.2 hereof) shall keep in strictest confidence the
Confidential Information of the Disclosing Party (as defined in Section 12
hereof), using the standard of care it normally uses for information of like
character, and shall not disclose the Confidential Information to any third
party or use it except as expressly authorized by the prior written consent of
the Disclosing Party or as otherwise permitted by this Agreement; provided,
however, that Licensee may disclose the Confidential Information received from
UWA to its Affiliates and sublicensees as shall be reasonably necessary to carry
out the intent of this Agreement or any sublicense granted by Licensee as
contemplated by this Agreement if, but only if, such Affiliates and/or
sublicensees each execute a confidentiality agreement containing confidentiality
provisions no less restrictive than those confidentiality provisions contained
in this Section 10. The Receiving Party’s obligation hereunder shall not apply
to Confidential Information that the Receiving Party can show:

(a) Is or later becomes part of the public domain through no fault or neglect of
the Receiving Party;

(b) Is received in good faith from a third party having no obligations of
confidentiality to the Disclosing Party, provided, however, that the Receiving
Party complies with any restrictions imposed by the third party;

(c) Is independently developed by the Receiving Party without use of the
Disclosing Party’s Confidential Information; or

(d) Is required by law or regulation to be disclosed (including, without
limitation, in connection with FDA filings or filings with another government
agency), provided,

 

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however, that the Receiving Party uses reasonable efforts to restrict disclosure
and to obtain confidential treatment.

10.2 Limits on Permitted Disclosures. Each party agrees that any disclosure or
distribution of the other party’s Confidential Information within its own
organization shall be made only as is reasonably necessary to carry out the
intent of this Agreement. The parties further agree that all of their respective
officers, employees, agents, representatives or sublicensees to whom any
Confidential Information is disclosed or distributed shall have agreed to
maintain its confidentiality.

10.3 Legally Required Disclosures. If a subpoena or other legal process
concerning Confidential Information is served upon any party hereto pertaining
to the subject matter hereof, the party served shall notify the other party
immediately, the other party shall cooperate with the party served, at the other
party’s expense, in any effort to contest the validity of such subpoena or other
legal process. This Section 10.3 shall not be construed in any way to limit any
party’s ability to satisfy any disclosure of its relationship with the other
party required by any governmental authority.

10.4 Return of Confidential Information. In the event of any termination of this
Agreement, the Receiving Party shall, upon the Disclosing Party’s request,
promptly return all Confidential Information and any copies made thereof
previously made available to the Receiving Party by the Disclosing Party.

10.5 Remedies. Both parties acknowledge and agree that it would be difficult to
measure damages for breach by either party of the covenants set forth in this
Section 10, and that injury from any such breach would be incalculable, and that
money damages would therefore be an inadequate remedy for any such breach.
Accordingly, either party shall be entitled, in addition to all other remedies
available hereunder or under law or equity, to injunctive or such other
equitable relief as a court may deem appropriate to restrain or remedy any
breach of such covenants.

 

11. MISCELLANEOUS

11.1 Notices. Any notice, request, instruction or other document required by
this Agreement shall be in writing and shall be deemed to have been given (a) if
mailed with the United States Postal Service by prepaid, first class, certified
mail, return receipt requested, at the time of receipt by the intended
recipient, (b) if sent by Federal Express®, Airborne®, or other overnight
carrier, signature of delivery required, at the time of receipt by the intended
recipient, or (c) if sent by facsimile transmission, when so sent and when
receipt has been acknowledged by appropriate telephone or facsimile receipt,
addressed as follows:

 

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In the case of UWA to:

The University of Western Australia

35 Stirling Highway

Crawley, WA 6009

Attention: Director, Office of Industry and Innovation

Fax: +61 8 6488 2333

or in the case of Licensee to:

AVI BioPharma, Inc.

4575 SW Research Way, Suite 200

Corvallis, Oregon 97333 USA

Attention: Leslie Hudson, Ph.D., Chief Executive Officer

Fax: 541-754-3545

with a copy to:

Michael Phillips, Esq.

Davis Wright Tremaine LLP

1300 SW Fifth Avenue, Suite 2300

Portland, Oregon 97201 USA

or to such other address or to such other person(s) as may he given from time to
time under the terms of this Section 11 .1.

11.2 Governing Law. This Agreement shall be construed and enforced in accordance
with the laws of: (a) the United States of America and of the State of Oregon in
any action brought by UWA against Licensee, and (b) Perth, Western Australia in
any action brought by Licensee against UWA, irrespective of choice of laws
provisions. The parties agree that: (a) Portland, Oregon shall be the situs of
any legal proceeding arising out of or relating to this Agreement if initiated
by UWA against Licensee, and (b) Perth, Western Australia shall be the situs of
any legal proceeding arising out of or relating to this Agreement if initiated
by Licensee against UWA.

11.3 Waiver. Failure of any party to enforce a right under this Agreement shall
not act as a waiver of that right or the ability to assert that right relative
to the particular situation involved.

11.4 Enforceability. If any provision of this Agreement shall be found by a
court of competent jurisdiction to be void, invalid or unenforceable, the same
shall be reformed to comply with applicable law or stricken if not so
conformable, so as not to affect the validity or enforceability of the remainder
of this Agreement.

 

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11.5 Modification. No change, modification, or addition or amendment to this
Agreement, or waiver of any term or condition of this Agreement, is valid or
enforceable unless in writing and signed and dated by the authorized officers of
the parties to this Agreement.

11.6 Entire Agreement. This Agreement constitutes the entire agreement between
the parties with respect to the subject matter hereto and replaces and
supersedes as of the Effective Date any and all prior agreements and
understandings, whether oral or written, between the parties with respect to the
subject matter of such agreements; provided however, that this Agreement shall
have no effect on the Mutual Confidentiality Agreement dated October 1, 2008
between the parties.

11.7 Successors. Except as otherwise expressly provided in this Agreement, this
Agreement shall be binding upon, inures to the benefit of, and is enforceable
by, the parties and their respective heirs, legal representatives, successors
and permitted assigns.

11.8 Construction. This Agreement has been prepared, examined, negotiated and
revised by each party and their respective attorneys, and no implication shall
be drawn and no provision shall be construed against any party to this Agreement
by virtue of the purported identity of the drafter of this Agreement or any
portion thereof.

11.9 Counterparts. This Agreement may be executed simultaneously in one or more
counterparts, each of which shall constitute one and the same instrument. This
Agreement may be executed by facsimile.

11.10 Attorneys’ Fees. In the event of any action at law or in equity between
the parties hereto to enforce any of the provisions hereof, the unsuccessful
party to such litigation shall pay to the successful party all reasonable costs
and expenses, including reasonable attorneys’ fees, incurred therein by such
successful party; and if such successful party shall recover a judgment in any
such action or proceeding, such reasonable costs, expenses and attorneys’ fees
may be included in and as part of such judgment.

11.11 Assignment. This Agreement may not be assigned by either party without the
prior written consent of the other party, and any such attempted assignment
shall be void and of no effect, except that either party may assign this
Agreement to any successor in connection with the merger, consolidation or sale
of all or substantially all of its assets or that portion of its business to
which this Agreement relates.

11.12 Further Assurances. At any time and from time to time after the Effective
Date, each party shall do, execute, acknowledge and deliver, and cause to be
done, executed, acknowledged or delivered, all such further acts, transfers,
conveyances, assignments or assurances as may be reasonably required to
consummate the transactions contemplated by this Agreement.

11.13 Survival. The terms and conditions of the following provisions will
survive termination or expiration of this Agreement for as long as necessary to
permit their full

 

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discharge: Section 1 (“Definitions”), Section 6 (“Term and Termination”),
Section 8 (“Indemnification”), Section 9 (“Use of Names”) and Section 10
(“Confidentiality”). The provisions set forth in Section 4 (“Consideration”)
also shall survive any expiration or earlier termination of this Agreement, to
the extent set forth therein.

[Signature page follows.]

 

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IN WITNESS WHEREOF, the parties have caused their duly authorized
representatives to execute this Agreement as of the date first above written.

 

“UWA”: THE UNIVERSITY OF WESTERN AUSTRALIA,
A BODY CORPORATE ESTABLISHED PURSUANT TO THE PROVISIONS OF THE UNIVERSITY OF
WESTERN AUSTRALIA ACT 1911 By:   /s/ Doug McEachern Name:   Professor Doug
McEachern Its:   Deputy Vice-ChanceIlor (Research & Innovation) The University
of Western Australia Date:   24th November, 2008 “LICENSEE”: AVI BIOPHARMA,
INC., AN OREGON CORPORATION By:   /s/ Dr. L. Hudson Name:   Dr. L. Hudson Its:  
President & CEO Date:   January 7, 2008

 

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SCHEDULE 1

Diligence Milestones

 

1. Within two (2) years following announcement of the success of a Phase Ib
trial of AVI- 4658, Licensee (and/or its Affiliates or sublicensees) shall have
initiated a Phase II Trial of AVI-4658.

 

2. Within two (2) years following completion of a successful Phase II Trial of
AVI-4658, Licensee (and/or its Affiliates or sublicensees) shall have initiated
a Phase III Trial of AVI-4658.

 

3. Within two (2) years following completion of a successful Phase III Trial of
AVI-4658, Licensee (and/or its Affiliates or sublicensees) shall have submitted
a new drug application to the FDA or equivalent in the European Union for market
approval of AVI-4658.

 

4. If any of the aforementioned Milestones are unsuccessful, and provided the
provisions of Section 2.2 are observed by UWA, UWA may terminate the Agreement
in accordance with Section 2.2 unless Licensee has initiated a Phase I Trial of
a different Product within two (2) years of a Milestone for AVI-4658 being
unsuccessful. Any such Product(s) shall likewise be commercialized in accordance
with Section 2.2.

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APPENDIX A

Patent Assignment Agreement between UWA and GSK

See attached.

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PATENT ASSIGNMENT AGREEMENT

THIS PATENT ASSIGNMENT AGREEMENT (hereinafter, the “Assignment”) is made and
entered into this 10th day of March, 2006 by and between:

(1) SMITHKLINE BEECHAM CORPORATION, DOING BUSINESS AS GLAXOSMITHKLINE, a company
incorporated in the Commonwealth of Pennsylvania, with its principal office at
One Franklin Plaza, 200 N. 16th Street, Philadelphia, Pennsylvania 19101 USA
(“Assignee”); and

(2) THE UNIVERSITY OF WESTERN AUSTRALIA, a body corporate established pursuant
to the provisions of The University of Western Australia Act 1911 (Western
Australia), of 35 Stirling Highway, Crawley, Western Australia 6009
(“Assignor”).

RECITALS

(A) Whereas, the Assignor owns and has applied for certain patent applications
(the “Patent Applications”) defined below in respect of the inventions disclosed
in the Patent Applications (the “Inventions”);

(B) Whereas, Assignor has agreed to assign to Assignee the Patent Applications
and the Inventions disclosed therein as hereinafter set forth; and

(C) Whereas, Assignee desires to obtain all of Assignor’s right, title, and
interest in and to the Patent Applications and Inventions.

NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, in consideration of the promises and mutual
covenants contained herein, and intending to be legally bound hereby, the
parties hereto agrees as follows:

 

1. Definitions.

 

  a. “Inventions” has the meaning given to it in Recital (A) above.

 

  b. “Net Sales” shall mean the gross receipts worldwide from sales of the
Product by Assignee to third parties, less all customary deductions using
generally accepted accounting standards for:

 

  i) trade, cash and quantity credits, discounts, refunds or rebates;

 

  ii) allowances or credits to customers actually granted on account of
rejection, damage, or return of Product;

 

  iii) sales commissions;

 

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  iv) sales and excise taxes (including value added tax) and any other
governmental charges imposed upon the production, importation, use or sale of
Product;

 

  v) transportation charges, including insurance, for transporting Product to
the extent specifically invoiced to the customer; and

 

  vi) product rebates, discounts and charge backs including, without limitation,
those granted to managed-care entities and government agencies.

Product sales between GSK, its Affiliates and its and their sublicensees, shall
be excluded from the computation of Net Sales and no royalties shall be payable
on such sales.

 

  c.

“Patent Applications” means the international patent application
PCT/AU2005/000943, filed on 28 June 2005 and published as WO 2006/000057 on 5TH
January 2006, together with any further national application, divisional
application, continuation in part and the like deriving from said international
or national patent application(s) in any country in the world.

 

  d. “Product” means any product or part thereof, the manufacture, use, or sale
of which would infringe one or more Valid Claims included within the Patent
Applications.

 

  e. “Valid Claim’ shall mean a claim of an issued patent included in the Patent
Applications which has not been abandoned, lapsed, expired or been declared
invalid or unenforceable in a final, unappealable decision (or a decision from
which no appeal was taken) of a court of competent jurisdiction.

 

2. Assignment of Patent Applications and Inventions. Assignor hereby assigns to
Assignee all right, title, and interest in and to the Inventions and the Patent
Applications, and any patents granted thereon, and all rights associated
therewith, including but not limited to the right to apply for and obtain
patents and similar forms of protection in respect of the Inventions and the
Patent Applications throughout the world; the right to make any new application
or applications in respect of any part or parts of the subject matter of any
application or specification filed in connection with the Inventions and the
Patent Applications; the right to claim priority from the Patent Applications;
the right to bring proceedings for any previous infringement of the rights
assigned by this Assignment; and the right to claim priority of the Patent
Applications under the Paris Convention (as amended) in all countries and
territories and to hold the same unto the Assignee.

 

3. License Grant. Assignee hereby grants to Assignor a fully paid up,
irrevocable non-exclusive license to the Patent Applications and Inventions for
internal research purposes only.

 

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4. Payment. Assignor acknowledges that certain consideration for obtaining the
right title and interest in and to the Patent Applications and Inventions has
already been given, namely, that Assignee paid all fees associated with the
filing of the Patent Applications. In addition, Assignee shall continue to
assume all patent filing and prosecution costs associated with the Invention and
the Patent Applications.

 

5. Royalty. In further consideration for the license granted to Assignee
hereunder, Assignee shall pay a royalty to Assignor of 0.5 percent (0.5%) on the
Net Sales of Assignee on Products. Royalties shall be calculated on an annual,
calendar year basis and paid to Assignor within sixty (60) days of the end of
each calendar year.

 

  5.1 Record Retention. Assignee shall keep complete and accurate records in
sufficient detail to permit Assignor to confirm the accuracy of calculations of
all royalties due hereunder. Such records shall be retained by Assignee for a
three (3) year period following the year in which any such royalty payments were
due hereunder.

 

  5.2 The obligation to pay royalties hereunder shall terminate on expiration,
invalidation, lapse or abandonment of the last Valid Claim of the Patent
Applications except that the royalties accrued but not paid prior to such
expiration shall be payable with the next payment cycle under the provisions of
this Article 5. A patent shall be deemed to expire at midnight of the day of
expiration.

 

6. Cooperation. Assignor shall reasonably cooperate with Assignee, at Assignee’s
sole discretion and expense, to assist Assignee with filing patent applications
or other documents related to the Inventions and the Patent Applications,
including but not limited to, assisting in preparing and prosecuting the patent
applications, and consulting with Assignee and Assignee’s legal counsel
regarding the Inventions and patent applications. Assignor further agrees to
cooperate in executing all documents, instruments, and other papers and taking
actions as necessary for Assignee to secure patent rights and as necessary to
effect the transfer of all right, title and interest in and to the Patent
Applications and the Inventions to Assignee, and to record and perfect title
therein in the sole name of Assignee.

 

7.

Publication Rights. Assignor shall not publish or present any part of the
Inventions or any information included therein until a patent application
directed thereto has been filed. Assignee shall notify Assignor immediately in
writing upon the filing of any such patent application. Upon receipt of said
notification from Assignee, Assignor shall have the right to publish any
information related to or included within the Patent Applications, provided that
Assignor requests permission to publish or present from Assignee, and Assignee,
in its sole discretion, reviews and approves the information to be published or
presented. If Assignee does not, within ninety (90) days of receipt of a request
for permission to publish from Assignor, indicate either approval or rejection
of the publication or presentation, then Assignee will be deemed to have
approved the proposed publication or presentation. Any publication

 

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or presentation by the Assignee shall acknowledge the Assignor and appropriate
employees of the Assignor as co-authors on the publication or presentation.

 

8. No Publicity. Neither party hereto shall identify the other party in any
promotional advertising, press releases or other promotional materials to be
disseminated to the public or any portion thereof without the express prior
written consent of the other party. Assignor shall not use the name of Assignee
or the name of any Assignee’s directors, officers, employees, or agents, as
applicable, or any trademark, service mark, trade name, or symbol of Assignee,
without Assignee’s express prior written consent. Any promotional advertising,
press releases or other promotional materials prepared by Assignee and
concerning the Invention shall acknowledge Assignor’s participation in the
development of the Invention.

 

9. Warranties; Disclaimer of Warranties.

9.1 Assignor hereby represents and warrants that the subject matter of the
Patent Applications and the Inventions was developed by its employees, that such
employees have assigned their ownership rights in the Inventions and Patent
Applications to Assignor, and that Assignor has the full right and legal
authority to perform its obligations and grant the rights granted to Assignee
herein.

9.2 Assignor hereby represents and warrants that to Assignor’s knowledge the
manufacture, use or sale of any product or process under the Patent Applications
and the Inventions do not infringe any patent, copyright, trademark, or other
intellectual property rights of any third party. Assignor also hereby represents
and warrants that, to Assignor’s knowledge, no third party is infringing the
intellectual property rights contained in the Patent Applications and
Inventions.

9.3 Except as expressly stated in Section 9.1 and 9.2, ASSIGNOR MAKES NO
WARRANTIES OR REPRESENTATIONS OF ANY KIND, EITHER EXPRESS OR IMPLIED UNDER THIS
AGREEMENT, INCLUDING, BUT NOT LIMITED TO, WARRANTIES OF MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE OR REPRESENTATIONS AS TO THE PURITY, ACTIVITY,
SAFETY, OR USEFULNESS OF THE INVENTION ASSIGNED TO ASSIGNEE UNDER THIS
AGREEMENT.

 

10.

Assignment of Agreement. Neither party may assign this Agreement or its rights
and obligations hereunder, in whole or in part, to any third party without
obtaining the prior written consent of the other party; provided, however, that
ASSIGNEE may assign this Agreement, or its rights and obligations hereunder, in
whole or in part, to any of its Affiliates (as defined below) or to any entity
with which it may merge or consolidate or to which it may transfer all or
substantially all of its assets relating to the Inventions. Assignor may assign
this Agreement to an Affiliate only after obtaining the prior written consent of
Assignee. “Affiliate” means any entity that,

 

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directly or indirectly, is controlled by, controls or is under common control
with a party hereto. “Control” means having the power to direct, or cause the
direction of, the management and policies of any entity, whether through
ownership of voting securities, by contract or otherwise.

 

11. Notices. Any notices, payments or statements to be made under this Agreement
shall be made as follows:

If to Assignor:

Name: Simon Handford

Title: Project Manager Commercialisation,

University of Western Australia, 35 Stirling Highway, Nedlands WA 6009

Fax: +61 8 6488 2333

if to Assignee:

GlaxoSmithKline

Name: Dr. P. Anthony Akkari

Title: Human Genetics Manager

Mail Stop: MAI 1217

Five Moore Drive

Research Triangle Park, NC 27709

USA

Fax: 919-483-0659

with a copy to:

GlaxoSmithKline

R&D Legal Ops

VP and Senior Counsel

Mail Stop RN0220

2301 Renaissance Blvd.

King of Prussia, PA 19406

USA

Fax: 610-787-7084

or at such other address later designated in writing by either Party for such
purposes. Such notices shall be effective upon receipt

 

12. Choice of Law. This Agreement shall be interpreted and governed in
accordance with the laws of the Commonwealth of Pennsylvania, United States of
America, without giving effect to conflict of law provision of any jurisdiction.

 

13. Survival. The provisions of Sections 1, 2, 4, 6, 7, 8, 9, 10, 11, 12, and
13, hereof shall survive any expiration or termination of this Agreement.

 

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14. Entire Agreement. This Agreement constitutes the entire understanding of the
parties with respect to the terms of the subject matter hereof and shall not be
modified except by subsequent mutual written agreement.

IN WITNESS WHEREOF the parties hereto have executed this Assignment by their
duly authorised officers as of the date and year first above written.

 

SmithKline Beecham Corporation doing business as GlaxoSmithKline By:   /s/ Allen
D. Roses   Name:   Allen D. Roses   Title:   Sr. VP, Genetics Research
University of Western Australia By:   /s/ Doug McEachern   Name:   Professor
Doug McEachern   Title:   Pro Vice-Chancellor (Research & Innovation)

 

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EXECUTION COPY

APPENDIX B

Patent Assignment Agreement between UWA and GSK

See attached.

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PATENT ASSIGNMENT AGREEMENT

THIS PATENT ASSIGNMENT AGREEMENT (hereinafter the “Assignment”) is made and
entered into this 19th day of November 2008 (the “Effective Date”) by and
between:

 

  (1)

SMITNKLINE BEECHAM CORPORATION, DOING BUSINESS AS GLAXOSMITNICLINE, a company
incorporated in the Commonwealth of Pennsylvania, with its principal office at
One Franklin Plaza, 200 N. l6th Street, Philadelphia, Pennsylvania 19101 USA
(“Assignor”); and

 

  (2) THE UNIVERSITY OF WESTERN AUSTRALIA, a body corporate established pursuant
to the provisions of The University of Western Australia Act 1911 (Western
Australia), of 35 Stirling Highway, Crawley, Western Australia 6009
(“Assignee”).

RECITALS

 

  (A) Whereas the Assignor owns and has applied for certain patent applications
(the “Patent Applications”) defined below in respect of the inventions disclosed
in the Patent Applications (the “Inventions”).

 

  (B) Whereas Assignor has agreed to assign to Assignee the Patent Applications
and the Inventions disclosed therein as hereinafter set forth; and

 

  (C) Whereas Assignee desires to obtain all of Assignor’s right, title, and
interest in and to the Patent Applications and Inventions.

NOW THEREFORE, in consideration of the promises and mutual covenants contained
herein, and intending to be legally bound hereby, the parties hereto agree as
follows:

 

1. Definitions

 

  a. “Inventions” has the meaning given to it in Recital (A) above.

 

  b.

“Patent Applications” means the international patent application
PCT/AU2005/000943 filed on 28 June 2005 and published as WO 2006/000057 on
5th January 2006, the United States patent application Serial No. 11/570,691,
and the European patent application No. 05754344, together with any further
national applications, divisional applications, continuations-in-part and the
like deriving from said international, regional or national patent
application(s) in any country in the world.

 

2. Assignment of Patent Applications and Inventions. Assignor hereby assigns to
Assignee all right, title, and interest in and to the Inventions and the Patent
Applications, and any patents granted thereon, and all rights associated
therewith, including but not limited to the right to apply for and obtain
patents and similar forms of protections in respect of the Inventions and the
Patent Applications throughout the world; the right to make any new application
or applications in respect of any part or parts of the subject matter of any
application or specification filed in connection with the Inventions and the
Patent Applications; the right to

 

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claim priority form the Patent Applications; the right to bring proceedings for
any previous infringement of the rights assigned by these Assignment; and the
right to claim priority of the Patent Applications under the Paris Convention
(as amended) in all countries and territories and to hold the same unto the
Assignee.

 

3. License Grant. Assignee hereby grants to Assignor a filly paid up,
irrevocable non-exclusive, royalty-free license to the Patent Applications and
Inventions for internal research purposes only, including research conducted by
any of Assignor’s Affiliates (as defined below) or any entity with which it may
merge or consolidate or to which it may transfer all or substantially all of its
assets relating to the Inventions. “Affiliate” means any entity that, directly
or indirectly, is controlled by, controls or is under common control with a
party hereto. As used in the definition of Affiliate, the term “Control” means
having the power to direct, or cause the direction of, the management and
policies of any entity, whether through ownership of voting securities, by
contract, or otherwise.

 

4. Payment. In consideration for obtaining the right, title, and interest in and
to the Patent Applications and Inventions, Assignee agrees to pay Assignor the
sum of twenty-two thousand US dollars (US $22,000) within thirty days after
execution of this Agreement. This amount is non-refundable.

 

5. Cooperation. Assignor shall reasonably cooperate with Assignee, at Assignee’s
sole discretion and expense, in executing all documents, instruments, and other
papers and taking actions as necessary for Assignee to secure patent rights and
as necessary to effect the transfer of all right, title and interest in and to
the Patent Applications and the Inventions to Assignee, and to record and
perfect title therein in the sole name of Assignee.

 

6. No Publicity. Neither party hereto shall identify the other party in any
promotional advertising, press releases or other promotional materials to be
disseminated to the public or any portion thereof without the express prior
written consent of the other party. Assignee shall not use the name of Assignor
or the name of any Assignor’s directors, officers, employees, or agents, as
applicable, or any trademark, service mark, trade name, or symbol of Assignor,
without Assignor’s express prior written consent.

 

7. Disclaimer of Warranties. THE PATENT APPLICATIONS ARE PROVIDED “AS IS” AND
ASSIGNOR MAKES NO WARRANTIES OR REPRESENTATIONS OF ANY KIND, EITHER EXPRESS OR
IMPLIED UNDER THIS AGREEMENT, INCLUDING BUT NOT LIMITED TO WARRANTIES OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR REPRESENTATIONS AS TO THE
PURITY, ACTIVITY, SAFETY, OR USEFULNESS OF THE INVENTION ASSIGNED TO ASSIGNEE
UNDER THIS AGREEMENT OR FREEDOM FROM INFRINGEMENT OF THE INTELLECTUAL PROPERTY
RIGHTS OF A THIRD PARTY. ASSIGNOR SHALL NOT BE LIABLE HEREUNDER UNDER ANY
CONTRACT, NEGLIGENCE, STRICT LIABILITY OR OTHER LEGAL OR EQUITABLE REMEDIES FOR
ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES OR LOST PROFIT.

 

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8. No Liability. In no event shall Assignor have any liability of any kind in
connection with any use of the Invention or any product or service which is
based upon, derived from or incorporates the Invention by Assignee, its
licensees or assigns.

 

9. Notices. Any notices, payments or statements to be made under this Agreement
shall be made as follows:

If to Assignor:

GlaxoSmithKline

Name: Ashley H. Bates

Head Of Research & Development Alliances, Australia

{address}

with a copy to:

GlaxoSmithKline

R&D Legal Ops

VP and Senior Counsel

Mail Stop RN0220

2301 Renaissance Blvd.

King of Prussia, PA 19406

USA

Fax: 610-787-7084

If to Assignee:

Name: Simon Handford

Title: Project Manager Commercialization

University of Western Australia,

35 Stirling Highway , Nedlands, WA 6009

Fax: +61 8 6488 2333

Or at such other address later designated in writing by either Party for such
purposes. Such notices shall be effective upon receipt.

 

10. Choice of Law. This Agreement shall be interpreted and governed in
accordance with the laws of the Commonwealth of Pennsylvania, United States of
America, without giving effect to conflict of law provision of any jurisdiction.

 

11. Survival. The provisions of Sections 1, 2, 3, 4, 5, 6, 7, 8, 9, 10 and 11
hereof shall survive any expiration or termination of this Agreement.

 

12. Entire Agreement. This Agreement constitutes the entire understanding of the
parties with respect to the terms of the subject matter hereof and shall not be
modified except by subsequent mutual written agreement.

 

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IN WITNESS WHEREOF the parties hereto have executed this Assignment by their
duly authorized officers as of the date and year first above written.

 

SmithKlineBeecham Corporation
doing business as GlaxoSmithKline By:   /s/ Lon R. Cardon Name:   Lon R. Cardon
Title:   Senior Vice President, Genetics University of Western Australia By:  
/s/ Doug McEachern Name:   Professor Doug McEachern Title:  

Deputy Vice-Chancellor (Research & Innovation)

The University of Western Australia

AE McGrory

VG Campen

 

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