Exhibit 10.7

 

Execution Copy

 

Pursuant to Item 601(B)(10) of Regulation S-K, certain portions of this exhibit
have been redacted and, where applicable, have been marked “[***],” such
redactions are immaterial and would be competitively harmful if publicly
disclosed.

 

EXCLUSIVE PATENT LICENSE AGREEMENT

 

This License Agreement (“Agreement”) is made as of the 15th of December, 2017
(“Effective Date”), by and among BiomX Ltd., a Israeli corporation, having its
principal place of business at 2 Ilan Ramon St. Ness Tziona, Israel (the
“Company”), Keio University, a university duly organized and existing under the
laws of Japan, having its principal address at 2-15-45 Mita, Minato-ku, Tokyo
108-8345, Japan (the “University”), and JSR Corporation, a company duly
organized and existing under the laws of Japan, having its principal place of
business at 1-9-2, Higashi-Shimbashi, Minato-ku, Tokyo, 105-8640, Japan (“JSR”),
each referred to herein individually as a “Party” and collectively as the
“Parties.”

 

RECITALS

 

WHEREAS, the University, by virtue of its role as an educational institution,
carries out scientific research through its faculty, staff and students, and is
committed to bringing the results of that research into widespread use;

 

WHEREAS, the University is the owner, by assignment from inventors, of valuable
invention(s) entitled [***] (the “Technology”);

 

WHEREAS, JSR has been granted by the University the exclusive license, with the
right to sublicense, to use of the Technology;

 

WHEREAS, University, Yeda Research and Development Company Ltd. (the technology
commercialization subsidiary of the Weizmann Institute of Science, “Yeda”) and
Company are joint owners of an invention entitled [***] developed using the
Technology, and have filed a patent application with respect to such invention;

 

WHEREAS, the Company has represented to the University and JSR, to induce the
University and JSR to enter into this Agreement, that the Company is dedicated
to using commercially reasonable efforts (alone and/or through sublicensees) to
develop, produce, manufacture, market, and sell Products (as later defined
herein) and that it shall commit itself to a diligent program of exploiting the
Patent Rights (as later defined herein) with respect to Products so that public
utilization shall result therefrom; and

 

WHEREAS, the Company desires to be granted a license under the corresponding
Patent Rights and an exclusive license under University’s interest in the Joint
Patent Rights (as defined below) within the License Field (as later defined
herein).

 

 

 

 

NOW THEREFORE, in consideration of the premises and the mutual promises and
covenants set forth below, the parties hereto agree as follows:

 

1. CERTAIN DEFINITIONS

 

As used in this Agreement, the following terms shall have the following
meanings, unless the context requires otherwise.

 

1.1 “Affiliate” shall mean any legal entity (such as a corporation, partnership,
or limited liability company) that is controlled by a Party. For the purposes of
this definition, the term “control” means (a) beneficial ownership of at least
fifty percent (50%) of the voting securities of a corporation or other business
organization with voting securities or (b) a fifty percent (50%) or greater
interest in the net assets or profits of a partnership or other business
organization without voting securities.

 

1.2 “Commercially Reasonable Efforts” shall mean the efforts and resources
comparable to those undertaken by a biopharmaceutical or biotechnology company
of comparable size and resources as the Company relating to the development or
commercialization of a similar product owned by such company, or to which such
company has exclusive rights, with comparable market potential and at a similar
stage in its lifecycle. All relevant factors, as measured by the facts and
circumstances at the time such efforts are due, shall be taken into account,
including, as applicable and without limitation, stage of development, efficacy
and safety relative to competitive products in the marketplace, actual or
anticipated Regulatory Approval labeling, the nature and extent of market
exclusivity (including patent coverage, proprietary position and regulatory
exclusivity), and the cost and time required for and likelihood of obtaining
Regulatory Approval, but excluding from such consideration the obligation of the
Company to make payments requirement to be made by the Company to JSR under this
Agreement.

 

1.3 “Commencement” shall mean, with respect to a clinical trial, the first
dosing of a patient with a Product in such clinical trial.

 

1.4 “Confidential Information” shall have the meaning set forth in Appendix A.

 

1.5 “Cover,” “Covering” or “Covered” means, with respect to a product,
technology, process or method, that, but for a license granted to a person under
a Valid Claim of any patent under which such license is granted, the
development, manufacture, commercialization and/or other use of such product or
the practice of such technology, process or method, by such person would
infringe such Valid Claim.

 

1.6 “Covered Molecule” means any Phage-Based Molecule that (a) cannot be
manufactured, used, leased, or sold, in whole or in part, without infringing at
least one then current Valid Claim of the Patent Rights and/or Joint Patent
Rights and/or (b) is developed through the use of Materials transferred to
Company by University or JSR, provided that such Materials are not available
from other sources at the time of such transfer.

 

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1.7 “Distributor” shall mean any third-party entity to whom the Company, an
Affiliate of Company or a Sublicensee has granted, express or implied, the right
to distribute any Product pursuant to Section 2.1(c)(ii).

 

1.8 “First Commercial Sale” shall mean the initial Sale anywhere in the
applicable License Territory of a Product other than Excluded Transfers as
defined in Section 1.16(d).

 

1.9 “Joint Invention” shall mean any patentable invention (i) for which (a) at
least one inventor is an employee or a researcher of University and/or JSR and
(b) at least one inventor is an employee of the Company or (ii) obtained from
the use of the Materials delivered or transferred by the University or JSR to
the Company, provided that such Materials are not available from other sources
at the time of such use. The Parties should take reasonable methods and/or
actions to prevent any person, other than a Personnel of a Party (“Third
Person”) from being as an inventor of Joint Invention. For the avoidance of
doubt, JSR and University understand that Professors Rotem Sorek and Eran Elinav
of the Weizmann Institute of Science who are founders of the Company (the “WIS
Founders”) consult the Company and may be inventors on Joint Inventions. In such
case, the inventorship interests of the WIS Founders would be owned by Yeda and
licensed to the Company in accordance with the Company’s agreement with Yeda. In
case any Third Person, including the WIS Founders, is an inventor of the Joint
Invention either because of the consulting of the WIS Founders or under some
unavoidable situation, the Party who initiated the communication with a third
party to which a Third Person belongs (“Responsible Party”) should cause such
third party to accept all obligations with respect to the Joint Invention and/or
Joint Patent Rights the Responsible Party owes hereunder as if such third party
is the Responsible Party or in case of WIS Founders to have Yeda sign a letter
agreement in a form substantially similar to the one attached hereto as Appendix
B (if a Third Person does not belong to any entity, this sentence shall be read
to replace “such third party” with “Third Person”). In addition if other Parties
than the Responsible Party request the document to demonstrate such third
party’s acceptance of the obligations hereunder, the Responsible Party shall
submit such document satisfactory to other Parties without delay. “Personnel” of
a Party means an employee, other researcher, consultant or contractor of a Party
who is required to assign all of his/her/its rights in the Joint Invention to
such Party.

 

1.10 “Joint Patent Rights” shall mean: (i) [***] (including any PCT and/or U.S.
utility application claiming priority to such application) and the resulting
patents; (ii) any foreign counterparts of the foregoing; (iii) any divisionals,
continuations, continuation-in-part applications, continued prosecution
applications, or any other application claiming priority to one or more of the
patents applications and the resulting patents described in this Section 1.10
(i) or (ii); (iv) any patent or patent application claiming a Joint Invention;
(v) any patents resulting from reissues, reexaminations, extensions, or
restorations (and their relevant international equivalents) of any of the patent
applications or patents described in this Section 1.10 (i), (ii), (iii) or (iv)
.

 

1.11 “License Field” shall mean any therapeutic, wellness, nutritional and/or
preventive use for humans and/or animals. For the avoidance of doubt, the field
of diagnostic methods to identify the strains or to identify target indications
is not included in the License Field.

 

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1.12 “License Territory” shall mean anywhere in the world.

 

1.13 “Material Breach” shall mean a breach of this Agreement that is so dominant
or pervasive so as to frustrate the purpose of the undertaking of this
Agreement, which shall be evaluated based on: (a) the extent to which the
non-breaching party will be deprived of the benefit which it reasonably expected
from this Agreement; (b) the extent to which the non-breaching party can be
adequately compensated for the part of the benefit of which it will be deprived
due to such breach; (c) the extent to which the breaching party will suffer
forfeiture; (d) the likelihood that the breaching party will cure its failure,
taking account of all the circumstances including any reasonable assurances; and
(e) the extent to which the behavior of the breaching party comports with
standards of good faith and fair dealing.

 

1.14 “Materials” shall mean [***], which are owned by University and were
provided by University to Company under the MTA prior to the Effective Date and
are listed in Schedule A of Appendix C. In addition, during the [***] following
the Effective Date, upon request from the Company, University will provide
information of [***]. Such information shall include [***]. If Company informs
University in writing that it wishes to include any such strain as Materials
under this Agreement, such strain shall be added to Appendix C and shall be
deemed added to this definition and University or JSR shall provide such strain
to Company under the same terms of the MTA.

 

1.15 “MTA” means the material transfer agreement between Keio and the Company
made and entered as of October 1st, 2016.

 

1.16 “Net Sales” shall be calculated as set forth in this Section 1.16.

 

(a)Subject to the conditions set forth below, “Net Sales” shall mean:

 

(i)the gross amount invoiced, or if no invoice is issued, the amount received,
for any Sale of any Product by the Company or any Affiliates (a “Selling
Person”), to a non-Affiliate of the Selling Person,

 

(ii)less the following deductions, in each case to the extent specifically
related to the Product and taken by or granted by the Selling Person or
otherwise paid by the Selling Person:

 

A.trade, cash, promotional and quantity discounts;

 

B.taxes on gross sales (such as excise, sales or use taxes or value added taxes)
to the extent imposed upon and paid directly with respect to the sales price;

 

C.freight, transit insurance and other transportation that are invoiced in a
manner that clearly specifies the charges applicable to the applicable
Product(s);

 

D.amounts repaid or credits taken by reason of damaged goods, rejections,
defects, expired dating, recalls, returns or because of retroactive price
reductions;

 

4

 

 

E.charge back payments and rebates granted to (a) managed healthcare
organizations, (b) federal, state and/or provincial and/or local governments or
other agencies, (c) purchasers and reimbursers, or (d) trade customers,
including wholesalers and chain and pharmacy buying groups; and

 

F.customs duties actually paid by the Selling Person,

 

(iii)and only when i) the Product contains an API (active pharmaceutical
ingredient) other than Covered Molecule(s) and ii) the procurement cost of such
single API exceeds 30 (thirty) percent of cost of goods for the Product, also
less the deduction of such API’s procurement cost.

 

(b)Specifically excluded from the definition of “Net Sales” are amounts
attributable to any Sale of any Product between or among the Company and any
Affiliate of Company.

 

(c)No deductions shall be made for any commissions paid to any individuals or
for any costs or expenses of collections.

 

(d)The Company may accept any non-cash consideration for any Product only if (a)
such transaction is with a non-Affiliate and (b) Net Sales relating to such
transaction are calculated based on the cash amount charged to an independent
third party for the Product during the same Reporting Period or, in the absence
of such transaction, on the fair market value of the Product. Products provided
by the Company and Affiliates free of charge or at cost, solely for research
purposes, or solely for administration to patients enrolled in clinical trials,
or distributed through a not-for-profit foundation at no charge to patients, or
as free samples to promote additional Net Sales or for test marketing purposes,
in amounts consistent with normal business practices of Company or its
Affiliate, shall not be included in Net Sales (such provision of Products
collectively referred to as “Excluded Transfers”).

 

(e)Notwithstanding Section 1.16 (b) above, if any Product manufactured by the
Company is used by the Company or any Affiliate as an end-user, such Product
shall be deemed sold by the Company or the Affiliate and Net Sales of such
Product shall be calculated based on the cash amount charged to an independent
third party for the Product during the same Reporting Period or, in the absence
of such transaction, on the fair market value of the Product.

 

(f)If a product is sold in any country in the form of a combination product
containing (a) a product containing one or more Covered Molecule(s) and which
may include other API(s), which product is or has been sold as a separate
product (“Product A”) on the one hand and (b) a product containing one or more
other API(s) (i.e. API(s) not contained in Product A), which product is or has
been sold as a separate product (“Product B”) on the other hand, such product
which is composed of Product A and Product B shall be referred to as a
“Combination Product” under this Agreement. JSR and the Company agree to treat
Combination Products as follows:

 

[***] If, in a specific country, the Product A or the Product B is not sold, an
average market price for the Product A or the Product B, as the case may be, in
such country shall be determined by good faith negotiation. In such a case,
firstly Company will provide JSR with a written explanation for its proposal
based upon the market price of Product A or Product B in other countries with
respect to an average market price for the Product A or the Product B. If JSR
disagrees with the market price attributed by Company, JSR will be entitled to
notify Company in writing of such disagreement within [***] of receipt of such
explanation. If JSR provides such written notice within such [***] period, the
parties will resolve such disagreement in accordance with the procedure set
forth in Appendix D.

 

5

 

 

1.17 “Patent Rights” shall mean:

 

(a)the patent applications listed on Appendix E and the resulting patents;

 

(b)any foreign counterparts

 

(c)any divisionals, continuations, continuation-in-part applications, continued
prosecution applications, or any other application claiming priority to one or
more of the patent applications listed in Section 1.17(a) or 1.17(b), and the
resulting patents; and

 

(d)any other patent or patent application owned or controlled by University that
claims Materials.

 

(e)any patents resulting from reissues, reexaminations, extensions, or
restorations (and their relevant international equivalents) of the patents
described in this Section 1.17(a), (b), (c) or (d) above.

 

1.18 “Phage-Based Molecule” shall mean any active ingredient that is
bacterial-phage/s, bacterial-phage derived molecule/s or other molecule that has
a motif or fragment of a bacteriophage or any protein that is encoded by a
bacteriophage such as endolysin.

 

1.19 “Product” shall mean any product for use in the License Field that contains
a Covered Molecule as an active ingredient.

 

1.20 “Reporting Period” shall mean each three-month period ending March 31, June
30, September 30 and December 31.

 

1.21 “Regulatory Approval” means, collectively with respect to a particular
jurisdiction, all governmental approvals (including all pricing and
reimbursement approvals practically required to launch in the country), product
and/or establishment licenses, registrations or authorizations necessary for the
manufacture, use, storage, import, export, transport, marketing and sale of a
pharmaceutical product as a pharmaceutical in such jurisdiction. For the
avoidance of doubt, if Regulatory Approval for a particular jurisdiction
consists of multiple components (for example, approval of both the manufacturing
process used to produce the drug in the facility where it is used and in
addition approval of the safety and efficacy of the drug itself and permission
to market it), the Regulatory Approval for such jurisdiction for purposes of
this Agreement is not deemed to occur until the last component is approved.

 

6

 

 

1.22 “Royalty Term” means, on a Product-by-Product basis, the period commencing
as of the date of First Commercial Sale of such Product in any country within
the License Territory and ending upon the later of: (a) the date on which such
Product ceases to be covered by any Valid Claim in the US, EU or Japan, or (b)
five (5) years following the First Commercial Sale of such Product in the first
country within the License Territory. For purposes of the Royalty Term, two
Products with the same Covered Molecule will be deemed the same Product.

 

1.23 “Sell” (and “Sale” and “Sold” as the case may be) shall mean to sell or
have sold, to lease or have leased, or otherwise to transfer or have transferred
a Product for valuable consideration (in the form of cash or otherwise).

 

1.24 “Sublicense” shall mean a sublicense or any other right, license, privilege
or immunity to any non-Affiliate third party, including any cross-licensing
agreements, non-suit covenants and the like, under the rights granted in Section
2.1(a) and (b) to make, have made, use, have used, Sell or have Sold Products in
accordance with Section 2.1(a)(iii). For clarity, any rights granted under
Section 2.1(c) and (d) shall not be deemed a Sublicense.

 

1.25 “Sublicense Income” shall mean royalty and non-royalty consideration in any
form received by the Company under Sublicense Agreements as consideration for
the grant of Sublicenses. Sublicense Income shall include without limitation any
license signing fee, license maintenance fee, distribution or joint marketing
fee, and milestone payments; provided that Sublicense Income shall not include
research and development funding, or reimbursement of patent-related expenses,
or any consideration received for an equity interest in, extension of credit to,
or other investment in the Company or its Affiliates.

 

1.26 “Sublicense Agreement” shall mean any agreement, covenant or contract in
which the Company grants a Sublicense.

 

1.27 “Sublicensee” shall mean any person or entity granted a Sublicense. For
purpose of this Agreement, a Distributor of a Product shall not be included in
the definition of Sublicensee unless such Distributor (a) is granted any right
to make, have made, use or have used Products in accordance with Section
2.1(a)(ii), or (b) has agreed to pay to the Company or Affiliate(s) royalties on
such Distributor’s sales of Products, in which case such Distributor shall be a
Sublicensee for all purposes of this Agreement.

 

1.28 “Valid Claim” shall mean (a) any issued and unexpired claim of any Patent
Right or Joint Patent Rights that has not been (i) permanently revoked, nor held
unenforceable or invalid by a decision of a court or other governmental agency
of competent jurisdiction that is unappealable or unappealed in the time allowed
for appeal, nor (ii) rendered unenforceable through disclaimer or otherwise, nor
(iii) abandoned or lost through interference or opposition proceeding without
any right of appeal or review(an “Issued Valid Claim”), or (b) any claim of a
pending patent application of any Patent Right or Joint Patent Right that (i)
has been asserted and continues to be prosecuted in good faith, and (ii) has not
been abandoned or finally rejected without the possibility of appeal or
re-filing, provided that such pending patent application, if issued, would be an
Issued Valid Claim.

 

7

 

 

2. SUBLICENSE/LICENSE

 

2.1 Grant of Sublicense.

 

(a)Subject to the terms of this Agreement, including the limitations set forth
in Section 2.3 below, JSR hereby grants to the Company:

 

(i)in the License Field in the License Territory, an exclusive, royalty-bearing,
perpetual (subject to termination in accordance with this Agreement), sublicense
under its rights in the Patent Rights, Joint Patent Rights, Joint Inventions and
related know-how to research, develop, make, have made, use, sell, have sold,
import and have imported Products;

 

(ii)a non-exclusive, world-wide, royalty-bearing, perpetual (subject to
termination in accordance with this Agreement) sublicense under its rights in
the Patent Rights to research, develop, make, have made, use, sell, have sold,
import and have imported diagnostic products intended for use in conjunction
with Products; and

 

(iii)the right to grant further sublicenses under the rights granted in Section
2.1(a)(i) and 2.1(a)(ii) to Sublicensees.

 

(b)The sublicenses granted to Company under Sections 2.1(a) and any licenses
that may be granted by University in accordance with Section 2.7 (if any)
include the right to have some or all of Company’s rights under Section 2.1(a)
or 2.7, as applicable, exercised or performed by one or more of Company’s and/or
any Sublicensees’ Affiliates and/or contractors on Company’s or Sublicensee’s
(as applicable) or its Affiliate’s behalf only for Company’s or Sublicensee’s
benefit without such right being deemed a Sublicense; provided, however, that:

 

(i)no such Affiliate or contractor shall be entitled to grant, directly or
indirectly, to any third party any right of whatever nature under the rights
granted in Section 2.1(a); and

 

(ii)any act or omission taken or made by an Affiliate or contractor of Company
under this Agreement will be deemed an act or omission by Company under this
Agreement.

 

8

 

 

(c)The sublicense granted in Section 2.1(a) above and any licenses that may be
granted by University in accordance with Section 2.7 (if any) include:

 

(i)the right to grant to the final purchaser, user or consumer of Products the
right to use such purchased Products within the License Field and License
Territory; and

 

(ii)the right to grant a Distributor the right to Sell (but not to make, have
made, use or have used) Products Sold to such Distributor by or on behalf of the
Company, Affiliates and Sublicensees in a manner consistent with this Agreement.

 

(d)The sublicenses granted in Section 2.1(a) above and any licenses that may be
granted by University in accordance with Section 2.7 (if any) include:

 

(i)the right to grant to the final purchaser, user or consumer of diagnostic
products intended for use in conjunction with Products the right to use such
diagnostic products; and

 

(ii)the right to grant a Distributor the right to Sell (but not to make, have
made, use or have used) diagnostic products intended for use in conjunction with
Products Sold to such Distributor by or on behalf of the Company, Affiliates and
Sublicensees in a manner consistent with this Agreement.

 

2.2 Further Sublicenses. The Company shall have the right to grant sublicenses
under the rights granted in Section 2.1 and Section 2.7 (if any) at its sole
discretion provided that it is not in material breach of its material
obligations set forth herein and it complies with the terms hereof. Each
sublicense granted hereunder shall be consistent with and comply with all terms
of this Agreement, and shall incorporate terms and conditions which Company
reasonably believes are sufficient to enable the Company to comply with this
Agreement. Any sublicense which is not in accordance with the forgoing
provisions shall be null and void. Prior to or shortly following the signing of
a Sublicense agreement, Company may request in writing that JSR confirm in
writing that the relevant Sublicensee is an appropriate potential direct
licensee (i.e. an entity that is capable of further developing and/or
commercializing a Product that is the subject to the Sublicense) for purposes of
Section 10.6.4. If Company provides such a request, JSR shall not unreasonably
withhold or delay providing such confirmation. Copies of all Sublicense
Agreements, including all amendments thereto, shall be provided to JSR within
[***] of execution thereof with confidential information that is not relevant to
JSR redacted. The Company may redact from such copies any information the
Company or its sublicensee deems confidential that does not affect the
obligations of the Company under this Agreement or JSR’s or University’s ability
to monitor the Company’s compliance with its payment obligations under this
Agreement. University and JSR shall maintain such copies of Sublicense
Agreements in strict confidence and use them solely for the purposes of
monitoring JSR’s and University’s rights under this Agreement. The Company shall
not sublicense the Patent Rights to a patent holding company or other similar
non-operating entity that would not reasonably be expected to enable Company to
fulfill the due diligence obligations set forth in Section 3.1.

 

9

 

 

2.3 Retained Rights; Requirements. The University and JSR retain the right to
practice under the Patent Rights in the License Field in the License Territory
solely for educational and non-commercial research purposes; provided that the
University and JSR shall be prohibited from transferring any materials that are
Covered by the Patent Rights to any third party, unless (a) as a condition to
such transfer, such third party undertakes not to use such materials and not to
allow others to use such materials in the License Field in the License
Territory, without the Company’s prior written consent or (b) such transfer is
to a not-for-profit research institute and such research institute undertakes to
use such materials solely for non-commercial, academic research purposes.
Furthermore, this Agreement shall not be construed to grant any license or
sublicense to the Company outside the License Field with respect to the Patent
Rights. The University and JSR retain the full right under the Patent Rights
outside the License Field or outside the License Territory. For the avoidance of
doubt, any researcher of University and the same researcher who will move to
non-commercial organization (i.e. another university or non-commercial research
organization) and collaborators of his or her laboratory in the future may use
Patent Rights and/or Joint Patent Rights only for educational and non-commercial
research purposes.

 

2.4 Delivery of Materials. The Company acknowledges that it already received
some Materials of the bacterial strains Covered by the Patent Rights from the
University prior to the Effective Date under the MTA. JSR and the Company shall
enter into a Material Transfer Agreement substantially in the form attached to
this Agreement as Appendix C upon the execution of this License Agreement and
whenever the Company receives new Material from JSR or University. For the
avoidance of doubt, the Company may use the Materials received before the
execution of this License Agreement for the purpose described in Appendix C
after the execution of this License Agreement.

 

2.5 Treatment of the Joint Patent Rights. The Joint Patent Rights shall be
jointly owned by a) the Company and b) the University and/or JSR, as the case
may be. The University and JSR hereby consent (a) to the Company grant of
sublicenses with respect to the Joint Inventions and Joint Patent Rights for use
outside the License Field, freely without any payment to the University or JSR
and (b) to Yeda’s grant of an exclusive license to Company under Yeda’s interest
in the Joint Patent Rights. The Company hereby consents to the University’s
grant of sublicenses with respect to the Joint Inventions and Joint Patent
Rights solely for use outside the License Field to JSR freely without any
payment to the Company. The University hereby licenses its right under the Joint
Patent Rights and to practice and use the Joint Inventions to JSR exclusively
with the right to sublicense within the License Field, including the sublicenses
granted to Company under this Agreement; and Company consents to University’s
license of its rights under the Joint Patent Rights and Joint Inventions as set
forth in this sentence. JSR and University shall not license the right under
such Joint Patent Right or the license to practice and use the Joint Inventions
within the License Field to any third party except JSR (in case of University)
and the Company (in case of JSR) and shall not practice the inventions claimed
in the Joint Patent Right within the License Field, except for research purposes
that do not involve administration to humans, during the term of this Agreement.

 

10

 

 

2.6 AMED Research Program; Requirements.　The Company shall acknowledge that i)
the University shall be responsible for the requirement of the Innovative
Advanced Research and Development Support Project Unit Type of Japan titled
“CREST” and “LEAP” under the Japanese version of Bayh-Dole provision and the
obligation to report inventions to AMED, ii) the University must report created
inventions, etc. obtained from AMED Research Program and the status of such
rights to the government or funding agencies without delay and iii) this is a
condition for patent rights to remain with the University. The Company agrees to
cooperate in any action necessary for the University to meet its requirements
stipulated in this Section 2.6 at the Company’s own cost and acknowledges that
this License Agreement will be affected by the application of the Japanese
version of Bayh-Dole provision.

 

2.7 License from the University.

 

If the license between JSR and the University with respect to the Patent Rights,
the Joint Patent Rights, Joint Inventions and/or Materials is terminated due to
any reason not attributable to the Company, then the University shall negotiate
with the Company with respect to direct licenses from the University to the
Company reasonably and in good faith and the University agrees to keep the same
financial conditions in accordance with Section 4 hereunder, license scope and
other rights in accordance with Section 2 hereunder and termination conditions
in accordance with Section 10 hereunder in such direct licenses. Company and
University shall make good faith diligent efforts to enter into such a direct
license agreement within [***] from such termination. During such a good faith
negotiation between the University and the Company up to [***] period from the
termination of the license between JSR and the University, the Company shall
have an exclusive license from University in the same license scope in
accordance with Section 2 hereunder with the same financial terms in accordance
with Section 4 hereunder and the Company owes the same obligations under Section
3 and 5 of this Agreement, provided, however, that the Company shall reimburse
the University directly for all documented, out-of-pocket fees and costs,
including attorney’s fees, incurred by the University relating to the filing,
prosecution and maintenance of the Patent Rights, which have not been reimbursed
by JSR or a third party, in each case within [***] from the University’s
request. If the Company and the University does not reach the agreement within
such [***] period, the Company shall have non-exclusive license in the same
license scope in accordance with Section 2 hereunder, except for the
exclusivity, with the same financial terms in accordance with Section 4
hereunder for additional [***] after initial [***] period of negotiation and the
Company owes the same obligations under Section 3 and 5 of this Agreement,
provided, however, that the Company shall reimburse the University directly for
all documented, out-of-pocket fees and costs, including attorney’s fees,
incurred by the University relating to the filing, prosecution and maintenance
of the Patent Rights, which have not been reimbursed by JSR or a third party, in
each case within [***] from the University’s request. For the avoidance of
doubt, except as otherwise agreed between the University and the Company, the
University will not succeed JSR’s legal status as a licensor under this
Agreement, including, but not limited to, the terms in Section 7 and Section 9.

 

11

 

 

3. DUE DILIGENCE OBLIGATIONS

 

3.1 Diligence Requirements. The Company hereby represents that it accepts the
license granted hereunder with a view towards developing Products and making
Products available to the public. The Company, alone and/or through its
Affiliates and/or Sublicensees, as applicable, shall use, Commercially
Reasonable Efforts to develop and make available to the public Products in the
License Territory in the License Field. If JSR believes that the Company has
failed to fulfill its obligations under this Section 3.1, then JSR may notify
Company of such failure in writing, which notification will include an
explanation for JSR’s belief. If Company does not respond to such notification
within [***], JSR may treat such failure as a default and may terminate this
Agreement and/or any license granted hereunder in accordance with Section 10.4.
If Company reasonably believes that it has not failed to fulfill its obligations
under this Section 3.1, it may provide JSR with a written explanation of the
basis for its belief.

 

If Company provides a bona fide written explanation within [***] of the receipt
of JSR’s notice, JSR will not be entitled to terminate this Agreement nor any
license granted hereunder in accordance with Section 10.4 without first
undergoing the following process:

 

(a) If JSR does not accept the Company’s explanation, JSR may request that the
matter be escalated to the chief executive officers of JSR and the Company to
discuss the matter and find a solution within [***] of JSR’s request;

 

(b) If the chief executive officers of JSR and the Company cannot reach
agreement within such [***] period, either party may initiate mediation upon
written notice to the other party, in which case both parties shall be obligated
to engage in a mediation proceeding. The mediation shall commence within [***]
of such notice. The mediation shall be conducted by a single mediator in San
Francisco, California and will be conducted in the English language. The party
requesting mediation shall designate two (2) or more nominees for mediator in
its notice. The other party may accept one of the nominees or may designate its
own nominees by notice addressed to the Internal Chamber of Commerce in San
Francisco, CA and copied to the requesting party. If within, [***] following the
request for mediation, the parties have not selected a mutually acceptable
mediator, a mediator shall be appointed by the International Chamber of Commerce
according to its rules. The mediator shall attempt to facilitate a negotiated
settlement of the dispute, but shall have no authority to impose any settlement
terms on the parties. The expenses of the mediation shall be borne by Company,
but each party shall be responsible for its own counsel fees and expenses. If
JSR and Company are unable to reach a resolution of the matter, the dispute
shall be resolved in accordance with Section 12.8.

 

3.2 Progress Reports. The Company shall, upon request of JSR received within
[***], provide JSR with a report on the status of its commercial development
efforts with respect to Products and its commercial efforts to make Products
available to the public within [***] during the Term.

 

4. PAYMENTS AND ROYALTIES

 

4.1 License Issue Fee. Within [***] after the Effective Date, the Company shall
pay to JSR ten thousand US dollars ($10,000).

 

4.2 Annual License Fee. Within [***] after the [***] anniversaries of the
Effective Date, the Company shall pay to JSR fifteen thousand dollars ($15,000)
and within [***] after each subsequent anniversary of the Effective Date during
the Term, the Company shall pay to JSR twenty-five thousand US dollars
($25,000).

 

12

 

 

4.3 Milestone Payments. In addition to the payments set forth in Sections 4.1
and 4.2 above, the Company shall pay to JSR milestone payments, as follows:

 

Milestones  Amount Paid to JSR [***]  [***] [***]  [***]

 

 

The Parties acknowledge that for the purposes of milestone payments, two
products that contain same Covered Molecule (e.g. they have different
formulations) will be deemed the same Product. For the avoidance of doubt, the
Parties acknowledge that all such milestones are to be paid only once regardless
of whether achieved multiple times, by multiple entities. Milestone payments
shall be paid to JSR within [***] following achievement of the applicable
milestone.

 

4.4 Royalties.

 

(a)Royalties on Net Sales.

 

(i)Beginning with the First Commercial Sale in any country in the License
Territory, the Company shall pay to JSR royalties based on the total annual Net
Sales in the License Territory by the Company and its Affiliates on a
Product-by-Product basis during the Royalty Term for such Product, in the
amounts as follows:

 

Annual Net Sales in the Territory  Royalty Rate [***]*  [***] [***]*  [***]
[***]*  [***]

 

*[***].

 

(ii)The royalty rates set forth in Section 4.4(a)(i) are incremental or tiered
rates, which apply only for the respective increment of annual Net Sales of a
given Product described in the annual Net Sales column. Thus, once a total
annual Net Sales figure with respect to such Product is achieved for a given
year, the royalties owed on any lower tier portion of annual Net Sales are not
adjusted up to the higher tier rate for such year. Furthermore, the obligation
to pay royalties pursuant to Section 4.4(a)(i) is imposed only once with respect
to the same unit of a Product, regardless of how many patents may Cover the
Product.

 

13

 

 

(iii)All payments due to JSR under this Section 4.4(a) shall be due and payable
by the Company within [***] for the relevant royalty on Net Sales, and shall be
accompanied by a report as set forth in Section 5.2.. For the avoidance of
doubt, if the manufacture, use, lease, or sale of any Product is Covered by more
than one of the Patent Rights and/or Joint Patent Rights, multiple royalties
shall not be due.

 

(b)Royalties on Sublicense Income.

 

(i)The Company shall pay to JSR a percentage of all Sublicense Income received
by the Company or its Affiliates in accordance with the below schedule based on
the amount spent by the Company on the development of the Product(s) that are
covered by the applicable Sublicense Agreement before the execution of such
Sublicense Agreement:

 

Amount Spent  Percentage of Sublicense Income Paid to JSR [***]  [***] [***] 
[***] [***]  [***]

 

(ii)All payments due to JSR under this Section 4.4(b) shall be due and payable
by the Company within [***] in which the relevant Sublicense Income was
received, and shall be accompanied by a report as set forth in Section 5.3. For
the avoidance of doubt, if the manufacture, use, lease, or sale of any Product
is Covered by more than one of the Patent Rights and/or Joint Patent Rights,
multiple royalties shall not be due.

 

(c) If the Company enters into a license agreement with an unaffiliated third
party for the license of intellectual property rights that are not specific to
API(s) contained in Product B included in the Combination Product and that the
Company believes, in its good faith judgment, are needed for the making, using
or selling of the relevant Product with respect to which royalties are due on
Net Sales or that may be subject to a sublicense agreement with respect to which
royalties are due on Sublicense Income, the Company will be entitled to deduct
up to [***] of any amounts paid under such license agreement with respect to
such Products or Sublicense Income against amounts due for Net Sales or
Sublicense Income described above, as applicable; provided that in no event
shall any payments to JSR in any quarter be reduced by more than [***] of the
amount otherwise due [***].

 

14

 

 

4.5 Form of Payment. All payments due under this Agreement shall be payable in
United States dollars. Each payment shall reference this Agreement and identify
the obligation under this Agreement that the payment satisfies. Conversion of
foreign currency to U.S. dollars shall be made at the conversion rate existing
in the United States, as reported in The Wall Street Journal, on the last
working day of the applicable Reporting Period. Such payments shall be without
deduction of exchange, collection or other charges. If Company is required to
withhold any amounts payable hereunder to JSR due to the applicable laws of any
country, such amount will be deducted from the payment to be made by Company and
remitted to the appropriate taxing authority for the benefit of JSR. Company
will withhold only such amounts as are required to be withheld by applicable law
in the country from which payment is being made. Company shall submit to JSR
originals of the remittance voucher and the official receipt evidencing the
payment of the corresponding taxes with the applicable royalty report. Company
will cooperate with JSR to provide such information and records as JSR may
require in connection with any application by JSR to the tax authorities in any
country, including attempt to obtain an exemption or a credit for any
withholding tax paid in any country. All payments due under this Agreement shall
be payable by wire transfer to a bank account to be designated by JSR. Bank fees
shall be paid by the Company and shall not be deducted from any amount payable
to JSR.

 

4.6 Payment to the University. The payment under this Section 4 represents all
consideration that will be due for the rights granted to the Company (including
under any rights owned or licensed by JSR) under this Agreement. JSR will be
responsible for paying the University any amounts the University may be due on
account of the rights granted to the Company through JSR, out of the amounts
paid to JSR. When Section 2.7 shall apply, JSR and University shall promptly
notify Company of such. Following Company’s receipt of such notification, (a)
all references in this Agreement to payments to JSR shall be changed to
University, (b) Company shall make such payments to University instead of JSR
and (c) JSR shall have no further right to receive such payments from Company.

 

5. REPORTS AND RECORDS

 

5.1 Diligence Reports. Within [***] following JSR’s written request therefor,
the Company shall report in writing to JSR on progress made toward the
objectives set forth in Section 3.1 during such preceding [***] period,
including, without limitation, progress on research and development, status of
applications for Regulatory Approvals, manufacturing, marketing, and the number
of sublicenses entered into; provided that JSR shall make such request not more
frequently than [***] per calendar year.

 

15

 

 

5.2 Sales Reports. The Company shall deliver reports to JSR within [***] after
the end of each Reporting Period, commencing with first Reporting Period in
which there are Net Sales. Each report under this Section 5.2 shall contain at
least the following information as may be pertinent to a royalty accounting
hereunder for that Reporting Period:

 

(a)the number of Products Sold by the Company and/or its Affiliates in each
country;

 

(b)the amounts, invoiced and received by the Company and/or its Affiliates for
each Product, in each country, and total amount invoiced by the Company and/or
its Affiliates or payments made (in cases where no invoice was issued) to the
Company and/or its Affiliates for all Products;

 

(c)calculation of Net Sales for the applicable Reporting Period in each country,
including an itemized listing of permitted offsets and deductions; and

 

(d)total royalties payable on Net Sales in U.S. dollars, together with any
exchange rates used for conversion.

 

5.3 Sublicense Income Reports. The Company shall, along with delivering payment
as set forth in Section 4.4(b), report to JSR within [***] of receipt the amount
of all Sublicense Income received by the Company, and the Company’s calculation
of the amount due and paid to JSR from such income, including an itemized
listing of the source of income comprising such consideration, and the name and
address of each entity making such payments.

 

5.4 Deduction Report. If the Company enters into a license agreement pursuant to
Subsection 4.4(c) and deducts the applicable amount from the payment due to JSR
hereunder, the Company shall submit a report to JSR describing the calculation
of such deduction in detail with the evidence of such payment for the applicable
Reporting Period.

 

5.5 Audit Rights. The Company shall maintain, and shall cause each Affiliate and
Sublicensee to maintain, complete and accurate records relating to the rights
and obligations under this Agreement and any amounts payable to JSR in relation
to this Agreement, which records shall contain sufficient information to permit
JSR and its representatives to confirm the accuracy of any payments and reports
delivered to JSR and compliance in all other respects with this Agreement. The
Company shall retain and make available, and shall cause each Affiliate to
retain and make available, such records for at least [***] following the end of
the calendar year to which they pertain. During such period, JSR shall be
entitled to have an independent certified public accounting firm that is
acceptable to Company, such acceptance not to be unreasonably withheld or
delayed, and upon at least [***] advance written notice, inspect during normal
business hours, such records in order to verify any reports and payments made
and/or compliance in other respects under this Agreement. Such accountants shall
sign a customary confidentiality and non-use agreement and shall not be entitled
to disclose to JSR or University any information obtained or generated in such
audit other than other than information relating to the accuracy of reports and
payments delivered under this Agreement. The parties shall reconcile any
underpayment or overpayment within [***] after the accountant delivers the
results of the audit. If any such examination conducted pursuant to the
provisions of this Section 5.4 show an underreporting or underpayment of [***]
in any payment due to JSR hereunder, the Company shall bear the full cost of
such audit and shall remit any amounts due to JSR within [***] of receiving
notice thereof from JSR. The Company shall include similar audit rights
provisions in Sublicense Agreements, requiring Sublicensees to maintain records
with respect to Products covered by such Sublicense and permitting Company to
audit such Sublicensee’s records. In addition, at JSR’s request and expense,
Company shall exercise its rights to audit any such Sublicensee. If any such
audit requested by JSR reveals an underpayment of [***] in any payment due by
such Sublicensee, the Company shall bear the cost of such audit.

 

16

 

 

6. PATENT PROSECUTION AND MAINTENANCE

 

6.1 Responsibility for Patent Prosecution. The Company and other joint owner(s)
will prepare, file, prosecute, and maintain all of the Joint Patent Rights. The
joint owner(s) and JSR (if JSR is not the joint owner), shall have reasonable
opportunities to advise the Company and shall cooperate with the Company in
filing, prosecution and maintenance of the Joint Patent Rights. The Company
shall consult with the joint owner(s) and JSR (if JSR is not the joint owner)
before taking any action that would have a material adverse impact on the scope
of claims within the Joint Patent Rights. The Company shall furnish or instruct
attorneys to furnish to the University and JSR copies of documents relevant to
any such filing, prosecution or maintenance at least [***] prior to any
anticipated actions and shall consider in good faith any revisions reasonably
requested by the University and/or JSR with respect to such filings, provided
that Company will retain final decision making authority. Payment of all out of
pocket fees and costs, including attorney’s fees, incurred by joint owner(s)
relating to the filing, prosecution and maintenance of Joint Patent Rights shall
be borne by the Company.

 

6.2 Patent Rights Prosecution. JSR shall furnish to the Company copies of
documents relevant to any filing, prosecution or maintenance of Patent Rights
licensed to the Company hereunder at least [***] prior to any anticipated
actions. The Company may advise JSR and/or the University in selecting patent
attorneys, suggesting countries where patent filings are made and whether
pending claims are to be pursued.

 

7. INFRINGEMENT.

 

7.1 Notification of Infringement. Each Party agrees to provide written notice to
the other Party promptly after becoming aware of any infringement of the Patent
Rights and/or the Joint Patent Rights in the License Field.

 

17

 

 

7.2 Right to Prosecute Infringements.

 

(a)During the term of this Agreement, the Company may commence and prosecute at
its own expense and in its name alone all actions for past and future
infringements of the Patent Rights and/or the Joint Patent Right in the License
Field (“Infringement Actions by the Company”), provided that the Company obtains
JSR’s prior written consent on each Infringement Action by the Company with
respect to Patent Rights. JSR shall not withhold its consent on any Infringement
Action by the Company without reasonable ground. For example, if participation
of the University in an Infringement Action by the Company is required by the
laws of the jurisdiction where such action is commenced, or requested by the
Company, it shall be reasonable ground for JSR to withhold its consent on the
Infringement Action by the Company. For clarity, Company will not be required to
obtain JSR’s or University’s consent with respect to an Infringement Action by
the Company relating to the Joint Patent Rights and shall have the sole right to
commence such an Infringement Action by the Company. The total cost of any
Infringement Action by the Company shall be borne by the Company and the Company
shall keep any recovery or damages for past or future infringement obtained.

 

(b)If required by the laws of the jurisdiction where an Infringement Action by
the Company is commenced, and to the extent reasonably available under such
laws, i) JSR and the University shall cooperate the Company in giving the
Company the legal status to commence the Infringement Action by the Company or
ii) JSR shall cooperate with the Company in participating in an Infringement
Action by the Company as a licensor at the Company’s sole expense. The Company
shall reimburse JSR and the University for all documented, out-of-pocket costs
incurred by JSR and/or the University due to such cooperation. JSR or the
University shall not have any obligation of cooperation in, or action relating
to, any Infringement Action by the Company except as provided for in this
Section 7.2(b) or in Section 7(a).

 

7.3 Declaratory Judgment Actions. In the event that a declaratory judgment
action is brought against JSR, the University or the Company by a third party
alleging invalidity, unenforceability, or non-infringement of the Patent Rights,
JSR, at its option, shall have the right within [***] after commencement of such
action to take over or cause the University to take over the sole defense of the
action at JSR’s expense. If JSR does not exercise this right, the Company may
take over the sole defense of the action at the Company’s sole expense. For
clarity, no rights are granted under this Section 7.3 to JSR or University with
respect to Joint Patent Rights.

 

7.4 Recovery. Any recovery obtained in an action brought by the Company under
Sections 7.2 or 7.3 shall be distributed as follows: (a) each Party shall be
reimbursed pari passu for any expenses incurred in the action from the proceeds
of such action or settlement, (b) as to ordinary damages, such amount shall be
treated as Net Sales, and the Company shall pay to JSR based upon such amount a
reasonable approximation of the royalties and other amounts that the Company
would have paid to JSR if the Company had sold the infringing products,
processes and services rather than the infringer and (c) as to special or
punitive damages, JSR shall receive [***] of such damages and the remaining
[***] shall be retained by Company.

 

7.5 Cooperation. Subject to Section 7.2(b), each Party agrees to cooperate in
any action under this Article which is controlled by the other Party, provided
that the controlling Party reimburses the cooperating Party promptly for any
costs and expenses incurred by the cooperating Party in connection with
providing such assistance.

 

18

 

 

7.6 Right to Sublicense. So long as the Company remains the exclusive licensee
of the Patent Rights and/or Joint Patent Rights in the License Field in the
License Territory, the Company shall have the sole right to sublicense any
alleged infringer in the License Field in the License Territory for use of the
Patent Rights and/or Joint Patent Rights, as applicable, in accordance with the
terms and conditions of this Agreement relating to Sublicense Agreements.

 

7.7 Confidentiality of Prosecution and Maintenance Information. The Company
agrees to treat all information related to prosecution and maintenance of Patent
Rights as Confidential Information in accordance with the provisions of Appendix
A. JSR and University agree to treat all information related to prosecution and
maintenance of Joint Patent Rights as Confidential Information of Company in
accordance with the provisions of Appendix A.

 

8. INDEMNIFICATION

 

8.1 The Company shall indemnify, defend and hold harmless the University and JSR
and their respective trustees, directors, officers, medical and professional
staff, employees, and agents and their respective successors, heirs and assigns
(the “Indemnitees”), against any liability, damage, loss or expense (including
reasonable attorney’s fees and expenses of litigation) (a “Loss”) incurred by or
imposed upon the Indemnitees or any one of them as a result of any third party
claims, suits, actions, demands or judgments arising out of any theory of
product liability (including, but not limited to, actions in the form of
contract, tort, warranty, or strict liability) concerning any product, process
or service made, used, or sold or performed pursuant to any right or license
granted to Company pursuant to Sections 2.1 and 2.2 (including pursuant to any
sublicenses granted by Company) under this Agreement (“Claim”); provided that
the Company shall not have any liability for any Loss arising out of the willful
misconduct or gross negligence of any Indemnitee.

 

8.2 If any Indemnitee receives notice of any Claim, such Indemnitee shall, as
promptly as is reasonably possible, give Company notice of such Claim; provided,
however, that failure to give such notice promptly shall only relieve Company of
any indemnification obligation it may have hereunder to the extent such failure
diminishes the ability of Company to respond to or to defend the Indemnitee
against such Claim. The Company agrees, at its own expense, to provide attorneys
reasonably acceptable to JSR and/or the University, as the case may be, to
defend against any actions brought or filed against any Indemnitee with respect
to the subject of indemnity contained herein, whether or not such actions are
rightfully brought; provided, however, that any Indemnitee shall have the right
to retain its own counsel, at the expense of the Company, if representation of
such Indemnitee by counsel retained by the Company would be inappropriate
because of conflict of interests of such Indemnitee and any other party
represented by such counsel. The Company agrees to keep JSR and/or the
University, as the case may be, informed of the progress in the defense and
disposition of such claim and to consult with JSR and/or the University, as the
case may be, prior to any proposed settlement.

 

8.3 This Section 8 shall survive expiration or termination of this Agreement.

 

19

 

 

9. REPRESENTATIONS

 

9.1. JSR hereby represents and warrants to the Company that:

 

(a)JSR has the full right, power, and authority to grant the rights and licenses
granted herein;

 

(b)the Patent Rights licensed to the Company under this Agreement are, to JSR’s
knowledge at the time of execution of this Agreement, neither invalid nor
unenforceable, in whole or in part, nor subject to a proceeding seeking to hold
such Patent Rights invalid or unenforceable, in whole or in part;

 

(c)to JSR’s knowledge at the time of execution of this Agreement, the practice
of the Patent Rights licensed to the Company under this Agreement will not
infringe any existing issued patent owned or possessed by any third party;

 

(d)there are no judgments or settlements against or owed by JSR, nor are there
any pending or threatened claims or litigation, in each case relating to the
Patent Rights licensed to the Company under this Agreement at the time of
execution of this Agreement;

 

(e)to JSR’s knowledge at the time of execution of this Agreement, no third party
has infringed, misappropriated or violated, or is infringing, misappropriating
or violating, the Patent Rights; and

 

(f)JSR is the sole licensee of the University under the Patent Rights and Joint
Patent Rights in the License Field and is authorized to grant sublicenses to
Company under its licenses to the Patent Rights and Joint Patent Rights in the
License Field.

 

9.3 Nothing in this Agreement will be construed as:

 

(a)A representation or warranty by JSR or the University as to the
patentability, validity, scope, or usefulness of the Patent Rights and/or the
Joint Patent Rights;

 

(b)A representation or warranty by JSR or the University that anything made,
used, sold, or otherwise disposed of under any license granted in this Agreement
is or will be free from infringement of third-party patents or other proprietary
rights, or other patents or other proprietary rights not included in the Patent
Rights;

 

(c)An obligation to bring or prosecute actions or suits against third parties
for patent infringement; or

 

(d)An obligation to furnish any know-how not provided in Patent Rights.

 

JSR AND THE UNVERSITY EXPRESSLY DISCLAIM ANY AND ALL WARRANTIES, WHETHER EXPRESS
OR IMPLIED, PERTAINING TO THE MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE OF THE PATENT RIGHTS, THE PRODUCTS, OR ANYTHING ELSE LICENSED,
DISCLOSED, OR OTHERWISE PROVIDED TO THE COMPANY AND SUBLICENSEES UNDER THIS
AGREEMENT. TOTAL LIABILITY OF THE UNIVERSITY UNDER THIS AGREEMENT IS LIMITED TO
THE COSTS AND FEES PAID TO JSR UNDER THIS AGREEMENT AND EXCEPT FOR DAMAGES
RESULTING FROM A BREACH OF ANY OF THE REPRESENTATIONS OR WARRANTIES IN THIS
SECTION 9 OR A BREACH OF CONFIDENTIALITY OBLIGATIONS UNDER 12.13, TOTAL
LIABILITY OF JSR UNDER THIS AGREEMENT IS LIMITED TO THE COSTS AND FEES PAID TO
JSR UNDER THIS AGREEMENT.

 

20

 

 

10. TERM AND TERMINATION

 

10.1 Term. The term of this Agreement (“Term”) shall commence on the Effective
Date and, unless this Agreement is terminated earlier in accordance with any of
the other provisions of Section 10, shall remain in effect until the later of
(a) the date on which all issued patents and filed patent applications within
the Patent Rights and/or the Joint Patent Rights have expired, or been
abandoned, withdrawn, rejected, revoked or invalidated, and (b) the expiration
of the Royalty Term. Following the expiration of this Agreement pursuant to this
Section 10.1 (and provided the Agreement has not been earlier terminated
pursuant to any of the provisions of Sections 10.2 through 10.5), the licenses
granted to Company under Section 2 shall remain in effect and shall become
fully-paid up, royalty-free, perpetual and irrevocable.

 

10.2 Termination for Failure to Pay. If the Company fails to make any undisputed
payment due hereunder, JSR shall have the right to terminate this Agreement upon
[***] written notice, unless the Company makes such payments within said [***]
notice period. If such payments are not made within such [***] period, JSR may
immediately terminate this Agreement at the end of said [***] period.

 

10.3 Termination for Bankruptcy Related Events.

 

10.3.1 JSR shall have the right to terminate this Agreement immediately upon
written notice to the Company with no further notice obligation or opportunity
to cure if the Company: (a) shall make an general assignment for the benefit of
creditors or (b) or shall have a bona fide petition in bankruptcy filed for or
against it which petition is not dismissed within [***]. Notwithstanding the
foregoing, in the event Company has entered into a settlement with its creditors
or a bona fide petition in bankruptcy filed for or against it, and Company is
otherwise meeting its obligations pursuant to this Agreement, JSR shall not be
entitled to terminate this Agreement as contemplated under Section 10.3.1 during
such period. 

 

10.3.2 In case of termination due to bankruptcy related event of the Company,
the Company agrees to offer to sell or license any interest in Joint Patent
Rights of the Company to JSR prior to offering to any third party, provided that
such Joint Patent Rights are not subject to a license or sublicense to a third
party. The Company shall negotiate in good faith with JSR for a period of at
least [***] prior to offering such sale or license of any interest in Joint
Patent Rights of the Company to any third party. If the Company and JSR cannot
agree on the terms for entering into purchase or license agreement after
negotiation in good faith for a period of up to [***] (“Negotiation Period”),
then the Company may offer to sell or license any interest in Joint Patent
Rights of the Company to third parties; provided however, that for a period of
[***] after the Negotiation Period, Company shall not sell or license such
interest in the Joint Patent Rights of the Company to a third party on terms and
conditions, when taken as a whole (including, without limitation, financial
terms and the likelihood of that products will be developed under such rights in
a timely manner), are less favorable to Company than those offered to JSR,
without first offering such terms and conditions to JSR and providing JSR with
[***] to accept such terms and conditions.　

 

21

 

 

10.4 Termination for Non-Financial Default. If the Company breaches its
obligations under this Agreement not otherwise covered by the provisions of
Sections 10.2 and 10.3, and if such breach has not been cured within [***] after
notice by JSR in writing of such breach, JSR may immediately terminate this
Agreement, and/or any license granted hereunder in whole or in part, at the end
of said [***] period. Notwithstanding the foregoing, JSR shall be entitled to
terminate this Agreement in accordance with this Section 10.4 only if a breach
by the Company is a Material Breach. For the avoidance of doubt, Company shall
use reasonable efforts to cure any undisputed breach which could be cured within
such [***] and JSR may claim its damages incurred by any breach by the Company
even in case JSR shall not terminate this Agreement.

 

10.5 Termination by the Company. The Company shall have the right to terminate
this Agreement by giving [***] advance written notice to JSR and upon such
termination shall immediately cease all use and Sales of Products, subject to
Section 10.7.

 

10.6 Effects of Termination of Agreement.

 

10.6.1 Upon termination of this Agreement or any of the licenses hereunder for
any reason, final reports in accordance with Section 5 shall be submitted to JSR
and all royalties and other payments accrued or due to JSR as of the termination
date shall become immediately payable. In the case of termination in accordance
with Section 10.2., 10.3. or 10.4, the Company shall cease, and shall cause
Affiliates and Sublicensees to cease under any sublicense granted by the
Company, all Sales and uses of Products covered by any Valid Claims, subject to
Section 10.7.

 

10.6.2. The termination or expiration of this Agreement or any license granted
hereunder shall not relieve the Company, Affiliates or Sublicensees of
obligations arising before such termination or expiration. Upon termination of
this Agreement, each of Company and University shall have the full right to
practice and to grant licenses to third parties under its interest in Joint
Patent Rights without any obligation to seek the consent of the other or to
account for any profits made as a result of any such license.

10.6.3. If at the time of the termination of this Agreement more than one direct
Sublicensee exists, upon notice by each Sublicensee to JSR or the University (as
applicable) within [***] of the termination of this Agreement, so far as such
Sublicensee of the Company continues to pay JSR i) the annual license fee, ii)
the royalties (such royalties should be a) royalties on Net Sales by Sublicensee
and its Affiliates as stipulated in sub-Section 4.4 (a) and b) royalties on
Sublicense Income (as defined in Section 1.25, but with reference to amounts
received by the Sublicensee and its Affiliates and not to Company and its
Affiliates) received by such Sublicensee and its Affiliate in the percentages
stipulated in sub-Section 4.4 (b) (based on the amount spent by such Sublicensee
on the development of the Product(s) that are covered by the applicable further
sublicense agreement before the execution of such sublicense agreement), in case
of a further sublicense by such Sublicensee) under the same terms of this
Agreement as if such Sublicensee were Company and iii) the milestone payments
under the same terms of this Agreement [***] (i.e. if the Sublicensee were to
meet a milestone described in Section 4.3, it would have to pay [***] set forth
in Section 4.3 for such milestone), such Sublicensee may retain the same license
scope it enjoys under this Agreement for the period up to [***], provided,
however, that such Sublicensee owes the same obligations under Section 3 and
Section 5 of this Agreement. Company and JSR shall make good faith diligent
efforts to enter into such a direct license agreement within [***] from such
termination. For the avoidance of doubt, the royalty in accordance with this
sub-Section 10.6.3 should be calculated based upon global Sales of the same
Product by all Sublicensees. During such [***] period, JSR and such Sublicensee
shall have a good-faith, diligent and reasonable negotiation with respect to the
terms of a direct license between JSR and such Sublicensee, including but not
limited to, the financial conditions. The financial conditions of a new license
agreement between JSR and such Sublicensee should be at least the same as the
one under this Agreement however should not exceed financial conditions under
the agreement between the Company and such Sublicensee.

 

22

 

 

10.6.4. If at the time of the termination of this Agreement only a single direct
Sublicensee exists and such Sublicensee was confirmed by JSR as an appropriate
potential direct licensee in accordance with Section 2.2 prior to or shortly
following the time of execution of Sublicense Agreement between such Sublicensee
and the Company, then JSR agrees to keep the same financial terms on [***]. JSR
shall not unreasonably withhold or delay its confirmation, provided, however,
that JSR shall have a commercially reasonable access to information which is
necessary for JSR to make such confirmation. During a good faith negotiation for
direct license between JSR and such Sublicensee up to [***] period from the
termination of this Agreement, such Sublicensee shall have an exclusive license
in the same license scope in accordance with Section 2 hereunder with the same
financial terms in accordance with Section 4 as described above in this Section
10.6.4. If JSR and such Sublicensee do not reach the agreement within such [***]
period, such Sublicensee shall have non-exclusive license in the same license
scope in accordance with Section 2 hereunder, except for the exclusivity, with
the same financial terms in accordance with Section 4 hereunder (as described
above in this Section 10.6.4) so far as the Sublicensee continues to negotiate
in good faith after the [***] period of negotiation. For the avoidance of doubt,
except for the direct licenses described above during the negotiations period or
as otherwise agreed between JSR and such Sublicensee, such Sublicensee will not
automatically succeed the Company’s legal status as a licensee under this
Agreement.

 

10.7 Inventory. Upon early termination of this Agreement, the Company,
Affiliates and Sublicensees may complete and Sell any work-in-progress and
inventory of Products that exist as of the effective date of termination
provided that (a) the Company pays to JSR the applicable running royalty or
other amounts due on such Net Sales in accordance with the terms and conditions
of this Agreement, and (b) the Company, Affiliates and Sublicensees shall use
reasonable efforts to complete and Sell all work-in-progress and inventory of
Products within [***] after the effective date of termination.

 

10.8 Results.

 

(a) If this Agreement is terminated by JSR pursuant to Section 10.2, 10.3 or
10.4 , or by the Company pursuant to Section 10.5, in each case prior to the
grant of the first Sublicense to a pharmaceutical or biotechnology company for
continued clinical development under this Agreement, upon the written request of
JSR, to be provided within [***] of termination, the Company shall grant to JSR
of a non-exclusive license to data and other results obtained by the Company in
the clinical development and other activities under the rights granted in this
Agreement as well as documents prepared for Regulatory Approvals (collectively,
“Results”) on commercially reasonable terms. If JSR provides such written
request within such [***] period, the parties will enter into good faith,
diligent efforts to agree on such terms. If the parties are unable to reach
agreement on such terms within [***] of JSR’s written request, the terms will be
determined in accordance with procedure set forth in Appendix D.

 

23

 

 

(b) Provided that if JSR has reasonably determined that it is necessary for JSR
or any Affiliate of JSR to have a license of any technology of a non-Affiliate
third party in order to make, use or Sell the relevant Product, JSR shall
thereafter be entitled to deduct [***] of the amount of the royalties paid to
such third party by JSR or any Affiliate of JSR on Sales of such Products made
using such technology from the payments due to Company under Section 10.8(b),
provided that in no event shall the total of such deductions reduce the amounts
payable to Company by more than [***] in any Reporting Period. For the purpose
of this Section 10.8 only, the term “the Company” appearing in Section 1.16 (the
definition of “Net Sales”) is replaced by the term “JSR”, and the term “JSR”
appearing in Section 1.16 is replaced by the term “the Company”.

 

11. COMPLIANCE WITH LAW

 

The Company shall have the sole obligation for compliance with, and shall ensure
that any Affiliates comply with, all government statutes and regulations that
relate to Products developed under this Agreement. The Company agrees that it
shall be solely responsible towards JSR and University that any necessary
licenses to export, re-export, or import Products developed under this Agreement
are obtained. The Company shall indemnify and hold harmless the University and
JSR, in accordance with Section 8, for any damages caused by any breach of the
Company’s obligations under this Section 11.

 

12. MISCELLANEOUS

 

12.1 Force Majeure. Neither Party will be responsible for delays resulting from
causes beyond its reasonable control, including, without limitation, fire,
explosion, flood, war, strike or riot; provided that the non-performing Party
uses commercially reasonable efforts to avoid or remove such causes of
non-performance and continues performance under this Agreement with reasonable
dispatch whenever such causes are removed.

 

12.2 Press Release. The parties will issue a joint press release in form and
substance to be agreed upon by the parties in good faith.

 

12.3 Entire Agreement. This Agreement constitutes the entire understanding
between the Parties with respect to the subject matter hereof.

 

24

 

 

12.4 Notices. Any notices, reports, waivers, correspondences or other
communications required under or pertaining to this Agreement shall be in
writing and shall be delivered by hand, or sent by a reputable overnight mail
service (e.g., Federal Express), to the other party. Notices will be deemed
effective (a) three (3) working days if sent by overnight mail, or (b) the same
day if delivered by hand. Unless changed in writing in accordance with this
Section 12.4, the notice address for JSR, the University and the Company shall
be as follows:

 

  If to JSR: JSR Corporation     1-9-2, Higashi-Shimbashi     Minato-ku, Tokyo,
105-8640, Japan     Attention: Director, Intellectual Property Department    
[***]         If to the University Keio University     2-15-45, Mita, Minato-ku,
Tokyo     Japan     Attention: Office of Research Development and Sponsored
Projects         If to the Company: BiomX Ltd.     Attention: CEO     7 Sapir
St.     P.O.Box 4044     Ness Ziona 7403630 Israel

 

Notwithstanding anything to the contrary, any notice related to termination of
this Agreement shall be delivered by a reputable overnight mail service (e.g.,
Federal Express) or by first class mail (certified or registered).

 

12.5 Amendment; Waiver. This Agreement may be amended and any of its terms or
conditions may be waived only by a written instrument executed by an authorized
signatory of the Parties or, in the case of a waiver, by the Party waiving
compliance. The failure of either Party at any time or times to require
performance of any provision hereof shall in no manner affect its rights at a
later time to enforce the same. No waiver by either Party of any condition or
term shall be deemed as a further or continuing waiver of such condition or term
or of any other condition or term.

 

12.6 Binding Effect. This Agreement shall be binding upon and inure to the
benefit of and be enforceable by the Parties hereto and their respective
permitted successors and assigns.

 

12.7 Assignment. This Agreement may not be assigned by any of the Parties
without the consent of the other Parties, which consent shall not be
unreasonably withheld, except that each Party may, without such consent, assign
this Agreement and the rights, obligations and interests of such Party to any of
its Affiliates, to any purchaser of all or substantially all of its assets or
research to which the subject matter of this Agreement relates, or to any
successor corporation resulting from any merger or consolidation of such Party
with or into such corporation; provided, in each case, that the assignee agrees
in writing to be bound by the terms of this Agreement.

 

25

 

 

12.8 Governing Law and Arbitration. This Agreement shall be governed by and
construed and interpreted in accordance with the laws of the State of
California, United States, excluding with respect to conflict of laws, except
that questions affecting the construction and effect of any patent shall be
determined by the law of the country in which the patent shall have been
granted. Except with respect to actions seeking relief other than monetary
compensation, any disputes, controversies or differences which may arise between
the Parties out of or in relation to or in connection with this Agreement shall
be finally settled by arbitration in Tokyo, Japan, in accordance with the Rules
of the Arbitration of the International Chamber of Commerce. Any arbitration
award granted shall be final and binding on the parties and shall not be subject
to appeal and shall be enforceable in any court of competent jurisdiction. The
language for the arbitration procedure shall be English and there shall be three
arbitrators. Each Party shall nominate an arbitrator. The two party-appointed
arbitrators shall then nominate the third and presiding arbitrator in
consultation with the Parties.

 

12.9 Severability. If any provision(s) of this Agreement are or become invalid,
are ruled illegal by any court of competent jurisdiction or are deemed
unenforceable under then current applicable law from time to time in effect
during the term hereof, it is the intention of the parties that the remainder of
this Agreement shall not be affected thereby. It is further the intention of the
parties that in lieu of each such provision which is invalid, illegal or
unenforceable, there be substituted or added as part of this Agreement a
provision which shall be as similar as possible in economic and business
objectives as intended by the parties to such invalid, illegal or enforceable
provision, but shall be valid, legal and enforceable.

 

12.10 Survival. In addition to any specific survival references in this
Agreement, Sections 1, 8, 10, 12 and Appendix D shall survive termination or
expiration of this Agreement. Any other rights, responsibilities, obligations,
covenants and warranties which by their nature should survive this Agreement
shall similarly survive and remain in effect.

 

12.11 Interpretation. The parties hereto are sophisticated, have had the
opportunity to consult legal counsel with respect to this transaction and hereby
waive any presumptions of any statutory or common law rule relating to the
interpretation of contracts against the drafter.

 

12.12 Headings. All headings are for convenience only and shall not affect the
meaning of any provision of this Agreement.

 

12.13 Confidentiality.

 

12.13.1 Beginning on the Effective Date of this Agreement and continuing
throughout the term of this Agreement and thereafter for a period of [***], the
Parties shall comply with confidentiality obligation in accordance with the
provisions of Appendix A with respect to information disclosed by the parties in
connection with this Agreement. Notwithstanding the forgoing JSR shall keep all
information with respect to Sublicense Agreement and/or the reports submitted to
JSR in accordance with Section 5 in confidence throughout the term of this
Agreement and after the termination of this Agreement until such information
falls within a public domain.

 

26

 

 

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

 

 

BIOMX Ltd.   Keio University                   BY: /s/ [***]   BY: /s/ [***]
Name: [***]   Name: [***]       TITLE:  Chief Executive Officer   TITLE: 
President       DATE: 24/12/17   DATE: 12/1/2018       JSR Corporation          
BY: /s/ [***]     Name: [***]         TITLE: Representative Director and
President           DATE: 2019/12/28    

  

27

 

 

Appendix A

 

CONFIDENTIALITY TERMS AND CONDITIONS

 

1. Definition of Confidential Information. “Confidential Information” shall mean
any information, including but not limited to data, techniques, protocols or
results, or business, financial, commercial or technical information, disclosed
by one Party (“Discloser” as applicable) to the other Party (“Recipient” as
applicable) in connection with the Exclusive Patent License Agreement dated 15th
of December, 2017 (the “License Agreement”) and identified as confidential at
the time of disclosure. JSR’s Confidential Information shall also include all
information disclosed by the University to the Company in connection with the
License Agreement. Capitalized terms used in this Appendix that are not
otherwise defined herein have the meanings ascribed in the License Agreement to
which this Appendix is attached and made a part thereof.

 

2. Exclusions. “Confidential Information” under the License Agreement shall not
include any information that (a) is or becomes publicly available through no
wrongful act of Recipient or the Receiving Individuals (as defined below);
(b) was known by Recipient prior to disclosure by Discloser without
confidentiality obligation, as evidenced by tangible records; (c) becomes known
to Recipient without restriction on disclosure from a third party having an
apparent bona fide right to disclose it; (d) is independently developed or
discovered by Recipient without use of Discloser’s Confidential Information, as
evidenced by tangible records. The obligations of confidentiality and non-use
set forth in this Appendix A shall not apply with respect to any information
that Recipient is required to disclose or produce pursuant to applicable law,
court order or other valid legal process provided that Recipient promptly
notifies Discloser prior to such required disclosure, discloses such information
only to the extent so required and cooperates reasonably with Discloser’s
efforts to contest or limit the scope of such disclosure.

 

3. Permitted Purpose. Recipient shall have the right to, and agrees that it
will, use Discloser’s Confidential Information solely for exercising its rights
and performing its obligations under the License Agreement (the “Purpose”),
except as may be otherwise specified in a separate definitive written agreement
negotiated and executed between the parties.

 

4. Restrictions. For the term of the License Agreement and a period of [***]
thereafter, Recipient agrees that: (a) it will not use such Confidential
Information for any purpose other than the Purpose; (b) it will not disclose
such Confidential Information to any other person or entity except as expressly
permitted hereunder; and (c) it will use reasonable efforts (but no less than
the efforts used to protect its own confidential and/or proprietary information
of a similar nature) (i) not to use such Confidential Information for any
purpose other than the Purpose, and (ii) not to disclose such Confidential
Information to any other person or entity except as expressly permitted
hereunder. Recipient may, however, disclose Discloser’s Confidential Information
only on a need-to-know basis to its, its Affiliates’, its contractors’ and
Sublicensees’ employees, staff members, consultants and agents (“Receiving
Individuals”) who are directly participating in the Purpose and who are informed
of and obligated to maintain the confidential nature of such information,
provided Recipient shall be responsible for compliance by Receiving Individuals
with the terms of the License Agreement and any breach thereof. This Section 4
shall survive termination or expiration of the License Agreement.

 

28

 

 

5. Right to Disclose. Discloser represents that to the best of its knowledge it
has the right to disclose to Recipient all of Discloser’s Confidential
Information that will be disclosed hereunder.

 

6. Ownership. All Confidential Information disclosed pursuant to the License
Agreement, including without limitation all written and tangible forms thereof,
shall be and remain the property of Discloser. Upon termination of the License
Agreement, if requested by Discloser, Recipient shall destroy all of Discloser’s
Confidential Information, provided that Recipient shall be entitled to keep one
copy of such Confidential Information in a secure location solely for the
purpose of determining Recipient’s legal obligations hereunder.

 

7. No License. Nothing in this Appendix A or the License Agreement shall be
construed as granting or conferring, expressly or impliedly, any rights by
license or otherwise, under any patent, copyright, or other intellectual
property rights owned or controlled by Discloser relating to Confidential
Information, except as specifically set forth in the License Agreement or other
written agreement.

 

8. Remedies. Each party acknowledges that any breach of this License Agreement
by it may cause irreparable harm to the other party and that each party is
entitled to seek injunctive relief and any other remedy available at law or in
equity.

 

9. General. This Appendix A, along with the License Agreement, contain the
entire understanding of the parties with respect to the subject matter hereof,
and supersede any prior oral or written understandings between the parties
relating to confidential treatment of information. Sections 1, 2, 4, 6, 7, 8 and
9 of this Appendix A shall survive any expiration or termination of the License
Agreement.

 

29

 

 

Appendix B

 

[***]

 

30

 

 

Appendix C

 

MATERIAL TRANSFER AGREEMENT

 

THIS MATERIAL TRANSFER AGREEMENT (this “Agreement”) is made and entered into
effective as of 15th of December, 2017 by and between JSR Corporation, a
Japanese corporation, having its principal place of business at 1-9-2,
Higashi-Shimbashi, Minato-ku, Tokyo, 105-8640, Japan (“JSR”) and BiomX Ltd., a
Israeli corporation, having its principal place of business at 2 Ilan Ramon St.
Ness Tziona, Israel (“Recipient”). Each of JSR and Recipient may be referred to
herein individually as a “Party” or collectively as the “Parties”.

 

In consideration of the mutual covenants and promises herein contained, JSR and
Recipient agree as follows:

 

Article 1 TRANSFER OF MATERIAL.

 

Recipient acknowledges that it received from Keio University (“University”) the
following materials owned by University (including its progeny, propagations or
derivatives if the material is DNA, cells, seeds or other propagative,
proliferous material; collectively, the “Material”) for the Purpose of Use (as
defined in Article 2 hereof) use by Recipient in a research project, subject to
the terms and conditions set forth in this Agreement.

 

[***]

 

Description of Material: Exhibited in Schedule A

 

[***]

 

[***]

 

Consideration: As provided for in the Exclusive Patent License Agreement dated
15th of December, 2017 between the Parties (“License Agreement”)

 

Article 2 PURPOSE AND TERMS OF USE.

 

2.1 Subject to Recipient’s continued compliance with the terms and conditions of
this Agreement, JSR hereby grants to Recipient a non-exclusive license to use
the Material during the term of this Agreement solely for the following purpose
(“Purpose of Use”) and under the following terms of use.

 

Purpose of Use: Research, development, manufacturing and commercialization of
live bacterial cocktails for therapeutic or prophylactic use; all related
activities (including, without limitation, determination of sequences of the
Material or any strain therein); and such other uses contemplated in this
Appendix B or the License Agreement or to support or exercise the rights granted
to Recipient under the License Agreement.

 

Terms of Use: As set forth in this Appendix C or the License Agreement

 

2.2 Recipient may not use the Material for any purpose other than the Purpose of
Use. Recipient may not disclose or transfer the Material to any third party
other than Recipient’s consultant, attorneys and/or agents who have agreed to
abide by the terms of this Agreement without the prior written consent of JSR.
Recipient shall be liable for any breach of such obligations by any such
Recipient’s consultant, attorneys and/or agents.

 

31

 

 

2.3 Recipient may not use any Material that constitutes DNA, cells or drugs, or
any derivatives thereof, for research or testing in humans or in animals
intended for human consumption.

 

2.4 Recipient shall use the Material in compliance with all Japanese and foreign
laws, governmental regulations, guidelines that may be applicable to the
transfer, use, handling, storage or disposition of the Material.

 

Article 3 RECIPIENT RESEARCHER; PLACE OF USE.

 

3.1 The Material shall be accessed and used only by the following person (the
“Recipient Researcher”) and laboratory personnel under Recipient Researcher’s
immediate and direct supervision and control, and only at the following place
(“Place of Use”). Recipient may change the Recipient Researcher and Place of Use
subject to the prior written consent of JSR.

 

Recipient Researcher:

 

Place of Use : BiomX facilities

 

3.2 JSR may, in its sole discretion, provide Recipient with information
regarding use, maintenance or control of the Material to the extent necessary to
facilitate the Purpose of Use.

 

Article 4 CONSIDERATION; COST.

 

4.1 In consideration of JSR’s transfer of the Material hereunder, Recipient
shall pay to JSR the consideration set forth in Article 1 plus any applicable
consumption tax thereon. Recipient shall pay such consideration and consumption
tax (if any) on or prior to the due date set forth in Article 1 via wire
transfer to the bank account as separately designated by JSR. Any and all costs
incurred in connection with the wire transfer shall be borne by Recipient.

 

4.2 Any and all costs and expenses incurred in connection with the delivery,
maintenance, repair, modification, return or any other use or disposal of the
Material shall be borne by Recipient.

 

4.3 Any late payment hereunder shall bear interest of [***] per annum from the
due date until JSR’s receipt of full payment.

 

4.4 JSR will not be required to return any payment made hereunder for any reason
whatsoever unless the Material is determined to be non-viable (i.e. is incapable
of growth under the conditions set forth by JSR) and JSR is unable to provide a
viable form of the Material.

 

Article 5 TITLE TO MATERIAL; NO TRANSFER OF RIGHTS.

 

Legal title and all other ownership interests in and to the Material shall at
all times remain with JSR or University. The transfer of the Material under this
Agreement shall not grant or be deemed to grant to Recipient any rights, title
or interest in or to the Material other than those specifically set forth in
this Agreement. Without limiting the generality of the foregoing, JSR does not,
expressly or impliedly, grant to Recipient any license to any rights under or
associated with (i) patents, utility models, designs, trademarks, copyrights or
applications therefor, or any similar, corresponding or equivalent rights to any
of the foregoing, anywhere in the world, or (ii) knowhow (collectively,
“Intellectual Property Rights”) in or to the Material as a result of the
transfer of the Material hereunder.

 

32

 

 

Article 6 MODIFICATION.

 

Except to exercise its rights in the Purpose of Use, Recipient may not, without
JSR’s prior written consent, (i) modify the Material, whether or not such
modification is necessary for the Purpose of Use, or (ii) reverse-engineer or
otherwise attempt to determine the chemical structure or sequence of the
Material.

 

Article 7 LOSS OR DAMAGE.

 

If Recipient loses or damages the Material, JSR may require Recipient to submit
a report regarding the loss of or damage to the Material and including any
information related thereto that JSR may request. In case such loss or damage is
caused by disaster, fire or theft, Recipient shall attach to the report a
certificate issued by a governmental authority or insurance company evidencing
the loss of or damage to the Material.

 

Article 8 RETURN AND DISPOSAL OF MATERIAL.

 

Upon expiration or termination of this Agreement, Recipient shall, in accordance
with JSR’s instructions, return, destroy or otherwise dispose of the unused
Material and used Material.

 

Article 9 RESEARCH RESULTS.

 

9.1 In consideration of the Material is transferred to Recipient under the
License Agreement, Recipient agrees that any invention, discovery, improvement,
development, or other technology developed, conceived or reduced to practice
solely by Recipient in connection with the use of the Material (collectively,
“Inventions”) shall be jointly owned by Recipient and University. Recipient
agrees that University shall include Inventions into the granted rights under
License Agreement and shall grant to licensees and sublicensees the same license
under Inventions in the License Agreement. For the avoidance of doubt, in the
event that Recipient becomes sublicensee of the License Agreement, granted right
to sublicensee shall include the same license under Inventions under the License
Agreement.

 

Article 10 PUBLICATIONS.

 

Any publication of research results using the Material shall be subject to JSR’s
prior written consent as to the content, timing and manner of such publication.
Recipient and Recipient Researcher shall, at the request of JSR, acknowledge JSR
and/or University as the source of the Material in any such publication.

 

Article 11 NO WARRANTY.

 

JSR MAKES NO WARRANTIES, EXPRESS OR IMPLIED, AS TO ANY MATTER WHATSOEVER,
INCLUDING, WITHOUT LIMITATION, THE OWNERSHIP, NONINFRINGEMENT OF ANY MATERIAL OR
ANY PATENT OR OTHER PROPRIETARY RIGHTS OF ANY PERSON, MERCHANTABILITY, OR
FITNESS FOR A PARTICULAR PURPOSE OF THE MATERIAL, OR THE ABSENCE OF LATENT OR
OTHER DEFECTS IN THE MATERIAL, WHETHER OR NOT DISCOVERABLE.

 

33

 

 

Article 12 INDEMNIFICATION; LIABILITY LIMITS.

 

Recipient shall, at all times during the term of this Agreement and thereafter,
indemnify, defend and hold JSR and University, its trustees, directors,
officers, employees, agents and students, harmless against all claims,
proceedings, demands and liabilities of any kind or nature whatsoever, including
reasonable attorneys’ fees and legal expenses, (i) arising out of the death of
or injury to any person or persons or out of any damage to property, or
resulting from the use, handling, storage or disposition of the Material, or
(ii) arising out of or in connection with the performance or breach by Recipient
of any obligation of Recipient or Recipient Researcher hereunder. In no event
shall JSR or University be liable for any use of the Material by Recipient, the
Recipient Researcher or its laboratory personnel, or for any loss, claim, damage
or liability of any kind or nature, that may arise from or in connection with
this Agreement or the use, handling, storage or disposition of the Material.

 

Article 13 CONFIDENTIALITY.

 

13.1 For the purposes of this Agreement, the term “Confidential Information”
means any and all technical information furnished by one Party (the “Disclosing
Party”) to the other Party (the “Receiving Party”) that (i) is in electronic,
written or other tangible form and clearly marked as “Confidential,” or (ii) is
disclosed orally or visually and designated as confidential at the time of the
oral or visual disclosure and, further, within thirty days after the oral or
visual disclosure, the summary of which is furnished to Receiving Party in
writing clearly marked as “Confidential” and/or materials, including, but not
limited to, the Material.

 

13.2 The term “Confidential Information” does not, however, include information
that (i) is or becomes within the public domain through no act of the Receiving
Party or its Representatives (as defined below) in breach of this Agreement;
(ii) is already in the Receiving Party’s possession without obligation of
confidentiality at the time of disclosure and the Receiving Party; (iii) has
been lawfully obtained by the Receiving Party from a third party having the
right to make the disclosure who places no obligation of confidence upon the
Receiving Party; or (iv) is independently developed by the Receiving Party
without access to or use of the Confidential Information of the Disclosing
Party.

 

13.3 The Receiving Party shall keep the Confidential Information confidential
and shall not, without the Disclosing Party’s prior written consent, disclose
any Confidential Information in any manner whatsoever, in whole or in part, to
any third party; provided, however, that the Receiving Party may disclose the
Confidential Information or portions thereof to its directors, officers,
employees, advisors and, in the case of JSR, University (collectively,
“Representatives”) (i) who need to know the Confidential Information for the
purposes of this Agreement and (ii) who have been advised of by the Receiving
Party and have agreed to maintain the confidential nature of the Confidential
Information. The Receiving Party agrees to be responsible for any and all
breaches of this Article 13 by its Representatives.

 

13.4 The Receiving Party shall use any Confidential Information of the
Disclosing Party solely for the purposes of this Agreement and shall not use,
directly or indirectly, any Confidential Information in whole or in part for any
other purpose whatsoever. The Receiving Party shall protect all Confidential
Information with at least the same degree of care with which the Receiving Party
would treat Confidential Information of its own.

 

13.5 In the event that the Receiving Party or any of its Representatives are
requested pursuant to, or required by, applicable law, regulation or legal
process to disclose any of the Confidential Information, the Receiving Party
shall (unless prohibited by applicable law) immediately notify the Disclosing
Party of the existence, terms and circumstances surrounding such request or
requirement, and consult with the Disclosing Party on the advisability of taking
legally available steps to resist or narrow the request. In the event that
disclosure of any Confidential Information is legally required, the Receiving
Party or its Representatives, as the case may be, shall furnish only that
portion of the Confidential Information which is legally required and exercise
all reasonable efforts to obtain reliable assurance that confidential treatment
shall be accorded to such Information.

 

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13.6 At any time upon the request of the Disclosing Party, the Receiving Party
shall, at its own expense, promptly deliver to the Disclosing Party, or at the
Disclosing Party’s request, destroy, all copies of the Confidential Information
(whether in written, electronic or other tangible format) in the Receiving
Party’s or its Representatives’ possession that was delivered to the Receiving
Party by the Disclosing Party. Notwithstanding the foregoing, the Receiving
Party and its Representatives shall be permitted to retain Confidential
Information that would be unreasonably burdensome to destroy (such as archived
computer records) or to the extent required to comply with applicable law, rules
and regulations, provided that any information so retained herein shall remain
subject to the terms of this Agreement.

 

13.7 This Article 13 will survive for five years after the termination of this
Agreement.

 

Article 14 EXPORT CONTROL.

 

Recipient covenants that it will not disclose to JSR any information that
contains information, technology or data of which use, export, release or
transfer is subject to any governmental restriction or prohibitions, including
the U.S. Export Administration Regulations, without JSR’s prior written consent.

 

Article 15 TERM AND TERMINATION.

 

15.1 The term of this Agreement commences on the Effective Date of the License
Agreement and continues in force and effect until a date of expiration or
termination of the License Agreement, unless earlier terminated in accordance
with this Agreement.

 

15.2 JSR may terminate this Agreement upon written notice to Recipient:

 

(i) if Recipient has breached any of its covenants or obligations contained in
this Agreement, and such breach has not been cured within a period of thirty
days after written notice of such breach from JSR;

 

(ii) in case of appointment of a trustee or receiver for all or any part of the
assets of Recipient, insolvency, liquidation or dissolution of Recipient, filing
of a petition in bankruptcy against or concerning Recipient, a general
assignment by Recipient for the benefit of creditor(s), or suspension of payment
or banking transactions by Recipient;

 

(iii) in case of any change in control of Recipient, consolidation or merger of
Recipient with or into a third party, the sale of all or substantially all of
Recipient’s assets to a third party, in each case that would render it
infeasible to continue this Agreement; or

 

(iv) in case of any other event that would render it infeasible to continue this
Agreement.

 

15.3 Termination of this Agreement does not affect any of the Parties’
respective rights accrued or obligations owed before termination, including the
rights and obligations as to indemnification under Article 12.

 

15.4 Article 5, Article 6, Articles 8 through 13, Article 15.4, Articles 16
through 18 shall survive expiration or termination of this Agreement unless
otherwise provided in this Agreement.

 

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Article 16 GOVERNING LAW.

 

This Agreement shall be governed in accordance with the laws of Japan, excluding
with respect to conflict of laws, except that questions affecting the
construction and effect of any patent shall be determined by the law of the
country in which the patent shall have been granted.

 

Article 17 DISPUTE RESOLUTION.

 

Except with respect to actions seeking relief other than monetary compensation,
any disputes, controversies or differences which may arise between the Parties
out of or in relation to or in connection with this Agreement shall be finally
settled by arbitration in Tokyo, Japan, in accordance with the Rules of the
Arbitration of the International Chamber of Commerce. Any arbitration award
granted shall be final and binding on the parties and shall not be subject to
appeal and shall be enforceable in any court of competent jurisdiction. The
language for the arbitration procedure shall be English and there shall be three
arbitrators. Each Party shall nominate an arbitrator. The two party-appointed
arbitrators shall then nominate the third and presiding arbitrator in
consultation with the Parties.

 

Article 18 GENERAL.

 

18.1 Any notice or communication required or permitted to be given hereunder
shall be given in writing and either by personal delivery, by facsimile, by
registered or certified mail (with all postage and other charges prepaid) or by
e-mail to the address shown below. Any notice delivered by personal delivery,
facsimile or e-mail shall be deemed given and effective at the time of delivery.
Any notice delivered by registered or certified mail shall be deemed given at
the end of the tenth business day after it is posted.

 

[***]   [***] 

 

18.2 No provision of this Agreement may be waived, amended or modified, in whole
or in part, nor any consent given, unless approved in writing by a duly
authorized officer of the Parties hereto.

 

18.3 Neither Party may assign, transfer or grant a security interest in, in
whole or in part, either this Agreement or any of its rights or interests
hereunder, or delegate, in whole or in part, any of its obligations hereunder,
without the prior written approval of the other Party.

 

18.4 This Agreement contains the entire agreement between the Parties concerning
the subject matter hereof and supersedes any, written or oral, understandings,
proposals, or representations by and between the Parties.

 

18.5 In the event that any provision of this Agreement is deemed invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions of this Agreement shall not in any way be affected or
impaired thereby.

 

18.6 The headings contained in this Agreement are inserted for convenience only
and do not affect in any way the meaning or interpretation of this Agreement.

 

18.7 This Agreement may be executed and delivered in separate counterparts,
including by facsimile or other electronic transmission, each of which, when so
executed and delivered, shall be deemed to be an original, but such counterparts
shall together constitute one and the same instrument.

 

36

 

 

IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed in
duplicate by their duly authorized representatives as of the date first above
written.

 

JSR:   Recipient:       JSR Corporation   BiomX Ltd.             Name: [***]  
Name: [***] Title: Representative Director and President   Title: Chief
Executive Officer

 

37

 

 

[***]

 

38

 

 

Appendix D

Determination of Attributed Value or License Terms

 

[***]

 

39

 

 

Appendix E

 

[***]

 

 

40